[Senate Report 105-380]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 713
105th Congress                                                   Report
                                 SENATE

 2d Session                                                     105-380
_______________________________________________________________________


 
       TO PROVIDE FEDERAL HOUSING ASSISTANCE TO NATIVE HAWAIIANS

                                _______
                                

  October 8 (legislative day, October 2), 1998.--Ordered to be printed

_______________________________________________________________________


   Mr. Campbell, from the Committee on Indian Affairs, submitted the 
                               following

                              R E P O R T

                         [To accompany S. 109]

    The Committee on Indian Affairs, to which was referred the 
bill (S. 109) to provide Federal housing assistance to Native 
Hawaiians having considered the same, reports favorably thereon 
with an amendment in the nature of a substitute and recommends 
that the bill (as amended) do pass.

                                Purpose

    The purpose of S. 109 is to implement the recommendations 
of the National Commission on American Indian, Alaska Native, 
and Native Hawaiian Housing by amending the Native American 
Housing Assistance and Self-Determination Act to address the 
housing needs of Native Hawaiians who are eligible to reside on 
lands set aside under the Hawaiian Homes Commission Act of 
1920.
    The primary objective of S. 109 is to enable Native 
Hawaiians who are eligible to reside on the Hawaiian Home Lands 
to have access to federal housing assistance that is currently 
provided to other eligible low-income American families based 
upon documented need.

                          Background and Need

    In 1920, with the enactment of Hawaiian Homes Commission 
Act, the United States set aside approximately 200,000 acres of 
public land that had been ceded to the United States in what 
was then the Territory of Hawaii to establish a permanent 
homeland for the native people of Hawaii, based upon findings 
of the Congress that Native Hawaiians were a landless people 
and a ``dying'' people. The Secretary of the Interior, Franklin 
Lane, likened the relationship between the United States and 
Native Hawaiians to the guardian-ward relationship that then 
existed between the United States and American Indians.
    As a condition of its admission into the Union of States in 
1959, the United States transferred title to the 200,000 acres 
of land to the State of Hawaii with the requirement that the 
lands be held ``in public trust'' for ``the betterment of the 
conditions of Native Hawaiians, as defined in the Hawaiian 
Homes Commission Act of 1920''. The Hawaii Admissions Act also 
required that the Hawaii State Constitution provide for the 
assumption by the new State of a trust responsibility for the 
lands. The lands are now adminstered by a State agency, the 
Department of Hawaiian Home Lands.
    However, similar to the responsibility with which the 
Secretary of the Interior is charged in the administration of 
Indian lands, the United States retained and continues to 
retain the exclusive authority to enforce the trust and to 
institute legal action against the State of Hawaii for any 
breach of the trust, as well as the executive right to consent 
to any actions affecting the lands which comprise the corpus of 
the trust and any amendments to the Hawaiian Homes Commission 
Act enacted by the legislature of the State of Hawaii affecting 
the rights of the beneficiaries under the Act.
    Within the last several years, three recent studies have 
documented the housing conditions that confront Native 
Hawaiians who either reside on the Hawaiian home lands or who 
are eligible to reside on the home lands.
    In 1992, the National Commission on American Indian, Alaska 
Native, and Native Hawaiian Housing issued its final report to 
the Congress, ``Building the Future: A Blueprint for Change''. 
The Commission's study compared housing data for Native 
Hawaiians with housing information for other citizens in the 
State of Hawaii. The Commission found that Native Hawaiians, 
like American Indians and Alaska Natives, lacked access to 
conventional financing because of the trust status of the 
Hawaiian home lands, and that Native Hawaiians had the worst 
housing conditions in the State of Hawaii and the highest 
percentage of homelessness, representing over 30 percent of the 
State's homeless population.
    The Commission concluded that the unique circumstances of 
Native Hawaiians require the enactment of new legislation to 
alleviate and address the severe housing needs of Native 
Hawaiians, and recommended that the Congress extend to Native 
Hawaiians the same federal housing assistance programs that are 
provided to American Indians and Alaska Natives under the Low-
Income Rental, Mutual Help, Loan Guarantee Program and 
Community Development Block Grant programs. Subsequently, the 
Community Development Block Grant program authority was amended 
to address the housing needs of Native Hawaiians.
    In 1995, the U.S. Department of Housing and Urban 
Development (HUD) issued a report entitled, ``Housing Problems 
and Needs of Native Hawaiians''. The HUD report was 
particularly helpful because it compared the data on Native 
Hawaiian housing conditions with housing conditions nationally 
and with the housing conditions of American Indians and Alaska 
Natives.
    The most alarming finding of the HUD report was that Native 
Hawaiians experience the highest percentage of housing problems 
in the nation--49 percent--higher than even that of American 
Indians and Alaska Natives residing on reservations (44 
percent) and substantially higher than that of all U.S. 
households (27 percent). Additionally, the HUD study found that 
the percentage of overcrowding in the Native Hawaiian 
population is 36 percent as compared to 3 percent for all other 
households in the United States.
    Applying the HUD guidelines, 70.8 percent of Native 
Hawaiians who either reside or who are eligible to reside on 
the Hawaiian home lands have incomes which fall below the 
median family income in the United States, and 50 percent of 
those Native Hawaiians have incomes below 30 percent of the 
median family income in the United States.
    Also in 1995, the Hawaii State Department of Hawaiian Home 
Lands published a Beneficiary Needs Study as a result of 
research conducted by an independent research group. This study 
found that among the Native Hawaiian population, the needs of 
Native Hawaiians eligible to reside on the Hawaiian home lands 
are the most severe--with 95 percent of home lands applicants 
(16,000) in need of housing, and with one-half of those 
applicant households facing overcrowding and one-third paying 
more than 30 percent of their income for shelter.
    Eligibility for an assignment of Hawaiian home lands for 
purposes of housing, agricultural development or pasture lands 
is a function of federal law--the Hawaiian Homes Commission Act 
of 1920--which has defined eligibility in terms of blood 
quantum. There are approximately 60,000 Native Hawaiians who 
would be eligible to reside on the home lands, but applying for 
an assignment of a parcel of home lands is voluntary. Because 
of the lack of resources to develop infrastructure (roads, 
access to water and sewer and electricity) on the home lands as 
required by State and county laws before housing can be 
constructed, hundreds of Native Hawaiians on the waiting list 
have died before receiving an assignment of home lands.
    Once an eligible Native Hawaiian reaches the top of the 
waiting list, he or she must be able to qualify for a private 
home loan mortgage, because the limited Federal and State funds 
available to the Department of Hawaiian Home Lands have been 
used to develop infrastructure rather than the construction of 
housing. An assignment of home lands property is in the form of 
a 99-year lease. Unless the heirs of the eligible Native 
Hawaiian qualify in their own right for an assignment of home 
lands under the provisions of the Hawaiian Homes Commission 
Act, upon the death of the eligible Native Hawaiian, the heirs 
must move off the land.
    Currently, Native Hawaiians who are eligible to reside on 
the home lands but who do not qualify for private mortgage 
loans do not have access to federal housing assistance programs 
that provide assistance to low-income families. This is due to 
the fact that for many years, the federal government took the 
legal position that because the government that represented the 
Native Hawaiian people had been overthrown in 1893 and thus 
there was no government-to-government relationship with the 
United States, extending federal housing program assistance to 
lands set aside exclusively for Native Hawaiians would be 
discriminating on the basis of race or ethnicity.
    The Hawaiian Homes Commission Act not only provides 
authority for the assignment of home lands property to Native 
Hawaiians. The Act also authorizes general leases to non-
Hawaiians. At the time the Act was passed by the Congress, it 
was anticipated that revenues derived from general leases would 
be sufficient to develop the necessary infrastructure and 
housing on the home lands. However, general lease revenue has 
not proven sufficient to address infrastructure and housing 
needs.
    In recent years, as a result of litigation involving third-
party leases of Hawaiian home lands, the United States 
revisited its legal position and found that the authority 
contained in the Hawaiian Homes Commission Act for general 
leases to non-Hawaiians meant that the land was not set aside 
exclusively for Native Hawaiians. The non-exclusive nature of 
the land set aside was thus found not to violate Constitutional 
prohibitions on racial discrimination.
    The change in the United States' legal position may be 
further informed by the ruling of the Ninth Circuit Court of 
Appeals in Rice v. Cayetano, No. 97-16095, 146 F.3d 1075 (9th 
Cir. 1998) in which the Appeals Court compared the special 
treatment of Native Hawaiians to the special treatment of 
Indians that the Supreme Court approved in Morton v. Mancari, 
417 U.S. 535 (1974) and cited its reference to Mancari in 
Alaska Chapter, Associated Gen. Contractors v. Pierce, 694 F.2d 
1162 (9th Cir. 1981), in which the Circuit Court expressed its 
finding that preferential treatment that is grounded in the 
government's unique obligation toward Indians is a political 
rather than a racial classification, even though racial 
criteria may be used in defining eligibility.
    However, the result of the United States' earlier legal 
position was that Native Hawaiians who were eligible to reside 
on the Hawaiian Home Lands and would have otherwise been 
eligible by virtue of their low-income status to apply for 
Federal housing assistance were foreclosed from participating 
in Federal housing assistance programs that were available to 
all other eligible families in the United States.

          An Amendment in the Nature of a Substitute to S. 109

    The purpose of the amendment in the nature of a substitute 
to S. 109 is to address these well-documented housing needs of 
Native Hawaiians by extending the same federal housing 
assistance available to American Indians and Alaska Natives to 
those Native Hawaiians most in need of housing--those who have 
consistently been denied access to federally-assisted housing 
programs--Native Hawaiians who reside or are eligible to reside 
on the Hawaiian Home Lands. The substitute amendment 
incorporates the recommendations of the U.S. Department of 
Justice and the U.S. Department of Housing and Urban 
Development.\1\
---------------------------------------------------------------------------
    \1\ Following the U.S. Supreme Court's 1995 ruling in Adarand 
Constructors, Inc., v. Pena, the U.S. Department of Justice was charged 
with the responsibility of conducting a legal review of all federal 
programs which may provide benefits to groups defined by race or 
ethnicity. Over the course of the last year, Committee staff has 
engaged in extensive discussions with Department of Justice officials 
with regard to S. 109 to assure that the bill's provisions meet the 
standards established in Adarand.
---------------------------------------------------------------------------
    The earlier version of S. 109, as reported by the Committee 
on October 23, 1997, approached the amendment of the Native 
American Housing Assistance and Self-Determination Act 
(NAHASDA) by substituting the term ``Native Hawaiian'' for the 
term ``Indian'' each place the latter term appeared, and 
incorporating Titles I through IV of NAHASDA by reference. The 
amendment in the nature of a substitute to S. 109 removes any 
reference to the term ``Indian'' and instead of incorporating 
provisions of NAHASDA by reference, replicates those relevant 
provisions of NAHASDA, adapted for application to the Hawaiian 
home lands.
    Appropriations for programs authorized by the Native 
American Housing Assistance and Self-Determination Act 
(NAHASDA) to address the housing needs in Indian country are 
determined by formula. If enacted, S. 109 authorizes 
appropriations for programs to address the housing needs of 
Native Hawaiians which would be allocated to the Department of 
Hawaiian Home Lands through a block grant. An appropriation for 
federal housing assistance for Native Hawaiians would be 
separate from an appropriation for federal housing assistance 
to address the housing needs in Indian country under NAHASDA, 
and unless a separate allocation of funding for Native Hawaiian 
housing assistance is secured, there would be no funding for 
Native Hawaiian housing assistance under the NAHASDA authority. 
It is the intent of the sponsor that in no instance, will 
funding for Indian programs under NAHASDA be reduced as a 
function of the authority provided in S. 109.
    At its June, 1998 mid-year meeting, the National Congress 
of American Indians adopted a resolution in support of passage 
of the amendment in the nature of a substitute to S. 109. The 
National American Indian Housing Council also approved a 
resolution in support of passage of the amendment in the nature 
of a substitute to S. 109 at the Council's June, 1998 meeting.

                          Legislative History

    S. 109 was introduced on January 21, 1997, by Senator 
Inouye, for himself and Senator Akaka, and was referred to the 
Committee on Indian Affairs. A hearing on S. 109 was held on 
April 3, 1997, in Honolulu, Hawaii. The Committee reported S. 
109 to the full Senate on October 23, 1997, with the agreement 
that concerns raised by the Chairman's staff would be addressed 
prior to seeking action on the measure by the Senate. In an 
effort to accommodate those concerns, S. 109 was redrafted, and 
an amendment in the nature of a substitute to S. 109 was 
adopted and ordered reported to the full Senate on July 15, 
1998.

            Committee Recommendation and Tabulation of Vote

    The Committee on Indian Affairs, in an open business 
session on July 15, 1998, adopted an amendment in the nature of 
a substitute to S. 109 by voice vote and ordered the bill, as 
amended, reported favorably to the Senate.

                      Section-by-Section Analysis

    Section 1.--Section 1 sets forth the short title of the 
Act, indicating that the Act may be cited as the ``Native 
American Housing Assistance and Self-Determination Amendments 
of 1998''.
    Section 2.--Section 2 sets forth the findings of the 
Congress.
    Paragraph 1 of section 2 sets forth the finding of the 
Congress that the United States has undertaken a responsibility 
to promote the general welfare of the United States by 
employing Federal resources to remedy the unsafe and unsanitary 
housing conditions and the acute shortage of decent, safe, and 
sanitary dwellings for families of lower income, including 
Native Hawaiian families of lower income, and by developing 
effective partnerships with governmental and private entities 
to accomplish these objectives.
    Paragraph 2 of section 2 sets forth the finding of the 
Congress that pursuant to the provisions of the Hawaiian Homes 
Commission Act, 1920, (42 Stat. 108 et seq.), the United States 
set aside 200,000 acres of land in the Federal territory that 
later became the State of Hawaii in 1959, in order to establish 
a homeland for the native people of Hawaii, also known as 
Native Hawaiians. The lands which were set aside under the Act 
were referred to in section 201(a)(5) of the Act as Hawaiian 
Home Lands.
    Paragraph 3 of section 2 sets forth the finding of the 
Congress that despite the intent of the Congress in 1920 to 
address the housing needs of Native Hawaiians through the 
enactment of the Hawaiian Homes Commission Act, 1920, in the 
years which have followed, there have been agencies of the 
United States which have taken the legal position that 
subsequently-enacted Federal housing laws designed to address 
the housing needs of all eligible families in the United States 
could not be extended to address the needs for housing and 
infrastructure development on the Hawaiian Home Lands on the 
grounds that the lands were set aside exclusively for a group 
of people who could be identified by their race and/or 
ethnicity.
    The legal theory was that the extension of Federal housing 
assistance programs to such lands would constitute 
discrimination on the basis of race in violation of the 
Fourteenth Amendment to the U.S. Constitution. The United 
States has subsequently revised its legal position based upon 
its finding that the lands set aside under the Hawaiian Homes 
Commission Act were not exclusively set aside for Native 
Hawaiians because the 1920 Act also set aside lands for general 
leasing to non-Hawaiians. In addition, the change in the United 
States' legal position may be further informed by the ruling of 
the Ninth Circuit Court of Appeals in Rice v. Cayetano, No. 97-
16095, 146 F.3d 1075 (9th Cir. 1998) in which the Appeals Court 
compared the special treatment of Native Hawaiians to the 
special treatment of Indians that the Supreme Court approved in 
Morton v. Mancari, 417 U.S. 535 (1974) and cited its reference 
to Mancari in Alaska Chapter, Associated Gen. Contractors v. 
Pierce, 694 F.2d 1162 (9th Cir. 1981), in which the Circuit 
Court expressed its finding that preferential treatment that is 
grounded in the government's unique obligation toward Indians 
is a political rather than a racial classification, even though 
racial criteria may be used in defining eligibility.
    However, the result of the United States' earlier legal 
position was that Native Hawaiians who were eligible to reside 
on the Hawaiian Home Lands and would have otherwise been 
eligible by virtue of their low-income status to apply for 
Federal housing assistance were foreclosed from participating 
in Federal housing assistance programs that were available to 
all other eligible families in the United States.
    Paragraph 4 of section 2 sets forth the finding of the 
Congress that although Federal housing assistance programs have 
been administered on a racially-neutral basis in the State of 
Hawaii, Native Hawaiians continue to have the greatest unmet 
need for housing and the highest rates of overcrowding, not 
only in the State of Hawaii, but the greatest unmet need for 
housing and the highest rates of overcrowding in the United 
States. Three studies conducted in the last several years have 
documented the findings of the Congress set forth in paragraphs 
5, 6, 7 and 8 of section 2.
    Paragraph 5 of section 2 sets forth the finding of the 
Congress that among the population of native people in the 
United States, Native Hawaiians experience the highest 
percentage of housing problems in the United States--
specifically, forty-nine percent of the Native Hawaiian 
population experience housing problems as compared to forty-
four percent of the American Indian and Alaska Native 
population, and as compared to twenty-seven percent for all 
other households in the United States. Paragraph 5 of section 2 
also sets forth the finding of the Congress that overcrowding 
in Native Hawaiian households is thirty-six percent as compared 
to three percent for all other households in the United States.
    Pagraph 6 of section 2 sets forth the findings of the 
Congress that the needs of the population of Native Hawaiians 
who are eligible to reside on the Hawaiian Home Lands are the 
most severe, as evidenced by the finding that the percentage of 
overcrowding in Native Hawaiian households on the Hawaiian Home 
Lands is thirty-six percent and that ninety-five percent of 
Native Hawaiians who are eligible to reside on the Hawaiian 
Home Lands, or approximately thirteen thousand Native 
Hawaiians, are in need of housing.
    Paragraph 7 of section 2 sets forth the finding of the 
Congress that under the guidelines of the Department of Housing 
and Urban Development, 70.8 percent of Native Hawaiians who 
either reside on the Hawaiian Home Lands or who are eligible to 
do so have incomes that fall below the median family income, 
and fifty percent of Native Hawaiians who either reside on the 
Hawaiian Home Lands or who are eligible to do so have incomes 
below thirty percent of the median family income.
    Paragraph 8 of section 2 sets forth the finding of the 
Congress that one-third of those Native Hawaiians who are 
eligible to reside on the Hawaiian Home Lands pay more than 
thirty percent of their income for shelter, and one-half of 
those Native Hawaiians who are eligible to reside on the 
Hawaiian Home Lands face overcrowding in their households.
    Paragraph 9 of section 2 sets forth the finding of the 
Congress that the extraordinarily severe housing needs of 
Native Hawaiians demonstrate that Native Hawaiians who either 
reside on the Hawaiian Home Lands or who are eligible to reside 
on the Hawaiian Home Lands have been denied equal access to 
Federal low-income housing assistance programs available to 
other eligible American families, and that a more effective 
means of addressing the housing needs of Native Hawaiians must 
be authorized.
    Paragraph 10 of section 2 sets forth the finding of the 
Congress that in order to address the continuing prevalence of 
extraordinarily severe housing needs among Native Hawaiians who 
either reside on the Hawaiian Home Lands or who are eligible to 
reside on the Hawaiian Home Lands, it is necessary to extend 
the Federal low-income housing assistance available to American 
Indians and Alaska Natives under the Native American Housing 
Assistance and Self-Determination Act of 1996 to those Native 
Hawaiians, consistent with the recommendations of the National 
Commission on American Indian, Alaska Native, and Native 
Hawaiian Housing.
    Paragraph 11 of section 2 sets forth the finding of the 
Congress that under the treaty-making power of the United 
States, the Congress had the authority to confirm a treaty 
between the United States and the government that represented 
the Hawaiian people, and pursuant to Article 1, section 8, 
clause 3 of the United States Constitution, the authority which 
is vested in the Congress to address matters affecting the 
indigenous peoples of the United States, includes the authority 
to address matters affecting Native Hawaiians.
    Paragraph 12 of section 2 sets forth the finding of the 
Congress that through treaties, Federal statutes, and Federal 
court rulings, the United States has recognized and reaffirmed 
that the political status of Native Hawaiians is comparable to 
that of American Indians and Alaska Natives; and that the 
aboriginal, indigenous people of the United States have a 
continuing right to autonomy in their internal affairs and an 
ongoing right of self-determination and self-governance that 
has never been extinguished
    Paragraph 13 of section 2 sets forth the finding of the 
Congress that the political relationship between the United 
States and the Native Hawaiian people has been recognized and 
reaffirmed by the United States through the enactment of 
Federal laws which include Native Hawaiians in the Native 
American Programs Act of 1974, the American Indian Religious 
Freedom Act, the National Museum of the American Indian Act, 
the Native American Graves Protection and Repatriation Act, the 
National Historic Preservation Act, the Native American 
Languages Act of 1992, the American Indian, Alaska Native and 
Native Hawaiian Culture and Arts Development Act, the Job 
Training Partnership Act, and the Older Americans Act of 1965.
    Paragraph 14 of section 2 sets forth the finding of the 
Congress that in the area of housing, the United States has 
recognized and reaffirmed its political relationship with the 
Native Hawaiian people through: (1) the enactment of the 
Hawaiian Homes Commission Act, 1920, which set aside 
approximately 200,000 acres of public lands in the Territory of 
Hawaii that had been ceded to the United States for 
homesteading by Native Hawaiians inorder to rehabilitate a 
landless and dying people; (2) the enactment of the Act entitled ``An 
Act to provide for the admission of the State of Hawaii into the 
Union'', approved March 18, 1958 (73 Stat. 4) by ceding title to the 
public lands formerly held by the United States to the State of Hawaii 
and mandating that those lands be held in public trust, for the 
betterment of the conditions of Native Hawaiians, and by transferring 
to the State of Hawaii what the United States deemed to be a trust 
responsibility for the administration of the Hawaiian Home Lands but 
retaining the exclusive authority to enforce the trust, and the 
exclusive right of the United States to consent to any actions 
affecting the land which comprise the corpus of the trust as well as 
the exclusive right to consent to any amendment to the Hawaiian Homes 
Commission Act, 1920, affecting the rights of beneficiaries under the 
Act, enacted by the legislature of the State of Hawaii; (3) the 
authorization of mortgage loans insured by the Federal Housing 
Administration for the purchase, construction, or refinancing of homes 
on Hawaiian Home Lands under the National Housing Act; (4) authorizing 
Native Hawaiian representation on the National Commission on American 
Indian, Alaska Native, and Native Hawaiian Housing under Public Law 
101-235; (5) the inclusion of Native Hawaiians in the definition under 
section 3672 of title 38, United States Code, applicable to subchapter 
V of chapter 37 of title 38, United States Code, relating to a housing 
loan program for Native American veterans; and (5) the enactment of the 
Hawaiian Home Lands Recovery Act which establishes a process for the 
conveyance of Federal lands to the Department of Hawaiian Home Lands 
that are equivalent in value to lands acquired by the United States 
from the Hawaiian Home Lands inventory.
    Section 3.--Section 3 amends the Native American Housing 
Assistance and Self-Determination Act of 1996 by adding a new 
Title VIII at the end of that Act, to provide authority for the 
provision of housing assistance to low-income Native Hawaiian 
families.

          Title VIII--Housing Assistance for Native Hawaiians

    Section 801.--Section 801 sets forth the definitions for 
purposes of Title VIII.
    Section 801(1).--Paragraph 1 of section 801 sets forth the 
definition of the term ``Department of Hawaiian Home Lands''. 
The term ``Department of Hawaiian Home Lands'' or 
``Department'', as used in Title VIII, means the agency or 
department of the government of the State of Hawaii that is 
responsible for the administration of the Hawaiian Homes 
Commission Act, 1920.
    Section 801(2).--Paragraph 2 of section 801 sets forth the 
definition of the term ``Director''. The term ``Director'', as 
used in Title VIII, means the Director of the Department of 
Hawaiian Home Lands.
    Section 801(3).--Paragraph 3 of section 801 sets forth the 
definition of the term ``elderly family'' and ``near-elderly 
family''. Subparagraph (A) of paragraph 3 provides that the 
term ``elderly family'' or ``near-elderly family'', as used in 
Title VIII, means a family whose head, or his or her spouse, or 
whose sole member is for an elderly family, an elderly person 
or for a near-elderly family, a near-elderly person. 
Subparagraph (B) of paragraph 3 provides that the term 
``elderly family'' or ``near-elderly family'' includes two or 
more elderly persons or near-elderly persons, as the case may 
be, living together; and one or more persons elderly or near-
elderly persons living with one or more persons determined 
under the housing plan to be essential to their care or well-
being.
    Section 801(4).--Paragraph 4 of section 801 sets forth the 
definition of ``Hawaiian Home Lands''. The term ``Hawaiian Home 
Lands'', as used in Title VIII, means lands that have the 
status as Hawaiian Home Lands under section 204 of the Hawaiian 
Homes Commission Act or lands acquired pursuant to the Hawaiian 
Homes Commission Act.
    Section 801(5).--Paragraph 5 of section 801 sets forth the 
definition of the term ``Housing Area''. The term ``housing 
area'', as used in Title VIII, means an area of the Hawaiian 
Home Lands with respect to which the Department of Hawaiian 
Home Lands is authorized to provide assistance for affordable 
housing under this Act.
    Section 801(6).--Paragraph 6 of section 801 sets forth the 
definition of the term ``Housing Entity''. The term ``housing 
entity'', as used in Title VIII, means the Department of 
Hawaiian Home Lands.
    Section 801(7).--Paragraph 7 of section 801 sets forth the 
definition of the term ``Housing Plan''. The term ``housing 
plan'', as used in Title VIII, means a plan developed by the 
Department of Hawaiian Home Lands.
    Section 801(8).--Paragraph 8 of section 801 sets forth the 
definition of the term ``Median Income''. The term ``median 
income'', as used in Title VIII, means, with respect to an area 
that is a Hawaiian housing area, the greater of the median 
income for the Hawaiian housing area, which is to be determined 
by the Secretary of Housing and Urban Development, or the 
median income for the State of Hawaii.
    Section 801(9).--Paragraph 9 of section 801 sets forth the 
definition of the term ``Native Hawaiian''. The term ``Native 
Hawaiian'', as used in Title VIII, has the meaning given the 
term ``Native Hawaiian'' in section 201 of the Hawaiian Homes 
Commission Act, 1920.
    Section 802.--Section 802 provides authority for the 
provision of block grants for affordable housing activities.
    Section 802(a).--Section 802(a) provides that for each 
fiscal year, the Secretary of Housing and Urban Development 
shall, to the extent amounts are made available to carry out 
Title VIII, make a grant under Title VIII to the Department of 
Hawaiian Home Lands to carry out affordable housing activities 
for Native Hawaiian families residing on or near the Hawaiian 
Home Lands.
    Section 802(b).--Section 802(b) provides that the Secretary 
of Housing and Urban Development may make a grant under Title 
VIII to the Department of Hawaiian Home Lands for a fiscal year 
but only if the Director has submitted a housing plan for the 
fiscal year to the Secretary and the Secretary has made a 
determination under section 804 that the housing plan complies 
with the requirements of section 803. The Secretary may waive 
the applicability of these requirements, in part, if the 
Secretary finds that the Department of Hawaiian Home Lands has 
not complied or cannot comply with the requirements due to 
circumstances beyond the control of the Department of Hawaiian 
Home Lands.
    Section 802(c).--Section 802(c) provides that except as 
provided in section 802(e), the amounts provided under a grant 
under section 802 may be used only for affordable housing 
activities under Title VIII that are consistent with a housing 
plan approved under section 804.
    Section 802(d).--Section 802(d) provides that the Secretary 
of Housing and Urban Development shall by regulation authorize 
the Department of Hawaiian Home Lands to use a percentage of 
any grant amounts received under Title VIII for any reasonable 
administrative and planning expenses of the Department relating 
to carrying out Title VIII and activities assisted with those 
amounts. The administrative and planning expenses include costs 
for the salaries of individuals engaged in administering and 
managing affordable housing activities assisted with grant 
amounts provided under Title VIII, and expenses incurred in 
preparing a housing plan under section 803.
    Section 802(e).--Section 802(e) provides that the Director 
shall make all reasonable efforts, consistent with the purposes 
of Title VIII, to maximize participation by the private sector, 
including nonprofit organizations and for-profit entities, in 
implementing a housing plan that has been approved by the 
Secretary of Housing and Urban Development under section 803.
    Section 802(f).--Section 802(f) provides that the Secretary 
of Housing and Urban Development shall be guided by the 
relevant program requirements of titles I, II and IV of the 
Native American Housing Assistance and Self-Determination Act 
in the implementation of housing assistance programs for Native 
Hawaiians under Title VIII. The Secretary may make exceptions 
to, or modifications of, program requirements for Native 
American housing assistance set forth in titles I, II and IV as 
necessary and appropriate to meet the unique situation and 
housing needs of Native Hawaiians.
    Section 803.--Section 803 sets forth the requirements 
associated with housing plans.
    Section 803(a).--Section 803(a) provides that the Secretary 
shall require the Director to submit a housing plan under 
section 803 for each fiscal year and provide for the review of 
each plan submitted under section 803.
    Section 803(b).--Section 803(b) provides that each housing 
plan under section 803 shall be in a form prescribed by the 
Secretary and contain, with respect to the five-year period 
beginning with the fiscal year for which the plan is submitted: 
(1) a general statement of the mission of the Department of 
Hawaiian Home Lands to serve the needs of the low-income 
families to be served by the Department; (2) a statement of the 
goals and objectives of the Department of Hawaiian Home Lands 
to enable the Department to serve the needs identified during 
the period; and (3) an overview of the activities planned 
during the period including an analysis of the manner in which 
the activities will enable the Department to meet its mission, 
goals, and objectives.
    Section 803(c).--Section 803(c) provides that a housing 
plan under section 803 shall be in a form prescribed by the 
Secretary of Housing and Urban Development and contain 
information relating to the fiscal year for which the 
assistance under Title VIII is to be made available, 
including--
          A statement of the goals and objectives to be 
        accomplished during the period covered by the plan;
          A statement of the housing needs of the low-income 
        families served by the Department and the means by 
        which those needs will be addressed during the period 
        covered by the plan, including a description of the 
        estimated housing needs and the need for assistance for 
        the low-income families to be served by the Department, 
        including a description of the manner in which the 
        geographical distribution of assistance is consistent 
        with the geographical needs of those families and needs 
        for various categories of housing assistance, and a 
        description of the estimated housing needs for all 
        families to be served by the Department;
          An operating budget for the Department in a form 
        prescribed by the Secretary that includes an 
        identification and a description of the financial 
        resources reasonably available to the Department to 
        carry out the purposes of Title VIII, including an 
        explanation of the manner in which amounts made 
        available will be used to leverage additional resources 
        and the uses to which the resources will be committed, 
        including eligible and required affordable housing 
        activities and administrative expenses;
          A statement of the affordable housing resources 
        currently available at the time of the submittal of the 
        plan and to be made available during the period covered 
        by the plan, including--
                  A description of the significant 
                characteristics of the housing market in the 
                State of Hawaii, including the availability of 
                housing from other public sources, private 
                market housing and the manner in which the 
                characteristics influence the decision of the 
                Department to use grant amounts to be provided 
                under Title VIII for rental assistance, the 
                production of new units, the acquisition of 
                existing units, or the rehabilitation of units;
                  A description of the structure, coordination, 
                and means of cooperation between the Department 
                and any other governmental entities in the 
                development, submission, or implementation of 
                housing plans, including a description of the 
                involvement of private, public, and nonprofit 
                organizations and institutions, the use of loan 
                guarantees under section 184A of the Housing 
                and Community Development Act of 1992, and 
                other housing assistance provided by the United 
                States, including loans, grants, and mortgage 
                assistance,
                  A description of the manner in which the plan 
                will address the needs identified;
                  A description of any existing or anticipated 
                home ownership programs and rental programs to 
                be carried out during the period covered by the 
                plan and the requirements and assistance 
                available under those programs;
                  A description of any existing or anticipated 
                housing rehabilitation programs necessary to 
                ensure the long-term viability of the housing 
                to be carried out during the period covered by 
                the plan, and the requirements and assistance 
                available under those programs;
                  A description of all other existing or 
                anticipated housing assistance provided by the 
                Department during the period covered by the 
                plan including transitional housing, homeless 
                housing, college housing, and supportive 
                services housing, and the requirements and 
                assistance available under such programs;
                  A description of any housing to be demolished 
                or disposed of, a timetable for that demolition 
                or disposition, and any other information 
                required by the Secretary with respect to that 
                demolition or disposition;
                  A description of the manner in which the 
                Department will coordinate with welfare 
                agencies in the State of Hawaii to ensure that 
                residents of affordable housing will be 
                provided with access to resources to assist in 
                obtaining employment and achieving self-
                sufficiency;
                  A description of the requirements established 
                by the Department to promote the safety of 
                residents of affordable housing, facilitate the 
                undertaking of crime prevention measures, allow 
                resident input and involvement, including the 
                establishment of resident organizations, and 
                allow for the coordination of crime prevention 
                activities between the Department and local law 
                enforcement officials; and
                  A description of the entities that will carry 
                out the activities under the plan, including 
                the organizational capacity and key personnel 
                of the entities;
                  Evidence of compliance that shall include, as 
                appropriate--
                          A certification that the Department 
                        will comply with title VI of the Civil 
                        Rights Act of 1964 or with title VIII 
                        of the Civil Rights Act of 1968 in 
                        carrying out Title VIII, to the extent 
                        that such title is applicable, and 
                        other applicable Federal statutes;
                          A certification that the Department 
                        will require adequate insurance 
                        coverage for housing units that are 
                        owned and operated or assisted with 
                        grant amounts provided under this 
                        title, in compliance with such 
                        requirements as may be established by 
                        the Secretary;
                          A certificate that policies are in 
                        effect and are available for review by 
                        the Secretary and the public governing 
                        the eligibility, admission, and 
                        occupancy of families for housing 
                        assisted with grant amounts provided 
                        under Title VIII;
                          A certificate that policies are in 
                        effect and are available for review by 
                        the Secretary and the public governing 
                        rents charged, including the methods by 
                        which such rents or home buyer payments 
                        are determined, for housing assisted 
                        with grant amounts provided under Title 
                        VIII; and
                          A certificate that policies are in 
                        effect and are available for review by 
                        the Secretary and the public governing 
                        the management and maintenance of 
                        housing assisted with grant amounts 
                        provided under Title VIII.
    Section 803(d).--Section 803(d) addresses the applicability 
of civil rights statutes.
    Section 803(d)(1).--Section 803(d)(1) provides that to the 
extent that the requirements of title VI of the Civil Rights 
Act of 1964 or of title VIII of the Civil Rights Act of 1968 
apply to assistance provided under title VIII of this Act, 
nothing in the requirements concerning discrimination on the 
basis of race shall be construed to prevent the provision of 
assistance under title VIII of this Act to the Department of 
Hawaiian Home Lands on the basis that the Department served 
Native Hawaiians; or to an eligible family on the basis that 
the family is a Native Hawaiian family.
    Section 803(d)(2).--Section 803(d)(2) provides that program 
eligibility under title VIII of this Act may be restricted to 
Native Hawaiians. Subject to the proviso, no person may be 
discriminated against on the basis of race, color, national 
origin, religion, sex, familial status, or disability.
    Section 803(e).--Section 803(e) provides that as condition 
of receiving grant amounts under title VIII of this Act, the 
Department of Hawaiian Home Lands shall, to the extend 
practicable, work with or subcontract with private nonprofit 
organizations experienced in the planning and development of 
affordable housing for Native Hawaiians to carry out affordable 
housing activities with those grants.
    Section 804.--Section 804 addresses the Secretary's review 
of the housing plans to be submitted under section 803.
    Section 804(a)(1).--Section 804(a)(1) provides that the 
Secretary is to conduct a review of a housing plan submitted to 
him pursuant to section 803 to ensure that the plan complies 
with the requirements of section 803, and the Secretary shall 
have the discretion to review the plan only to the extent that 
the Secretary considers the review necessary.
    Section 804(2).--Section 804(a)(2) provides that no later 
than sixty days after receiving a plan which is required to be 
submitted pursuant to section 803, the Secretary is to notify 
the Director of the Department of Hawaiian Home Lands as to 
whether the plan complies with the requirements of section 803, 
and if the Secretary does not notify the Director as required 
under section 804(a)(2) and section 804(b) upon the expiration 
of the sixty day period, the plan shall be considered to have 
been determined to comply with the requirements under section 
803 and the Director shall be considered to have been notified 
of compliance.
    Section 804(b).--Section 804(b) provides that if the 
Secretary determines that a plan submitted under section 803 
does not comply with the requirements of section 803, the 
Secretary shall specify in the notice under section 804(a) the 
reasons for noncompliance and any modifications that are 
necessary for the plan to meet the requirements of section 803.
    Section 804(c).--Section 804(c) provides that after the 
Director of the Department of Hawaiian Home Lands submits a 
housing plan under section 803, or any amendment or 
modification to the plan, to the Secretary, to the extent that 
the Secretary considers such an action to be necessary to make 
a determination under section 804(c), the Secretary shall 
review the plan, including any amendments or modifications 
thereto, to determine whether the contents of the plan set 
forth the information required by section 803 to be contained 
in the housing plan, whether the contents of the plan are 
consistent with information and data available to the 
Secretary, and whether the contents of the plan are not 
prohibited by or inconsistent with any provision of this Act or 
any other applicable law. If the Secretary makes a 
determination under section 804(c) that any of the appropriate 
certifications under section 803(c)(2)(E) are not included in 
the plan, the plan shall be considered to be incomplete.
    Section 804(d).--Section 804(d) provides that after a 
section 803 plan has been submitted for a fiscal year, the 
Director of the Department of Hawaiian Home Lands may comply 
with the provisions of section 803 for any succeeding fiscal 
year (with respect to information included for the five-year 
period under section 803(b) or for the one-year period under 
section 803(c)) by submitting only such information regarding 
such changes as may be necessary to update the plan previously 
submitted. However, the Director must submit a complete plan 
under section 803 not later than four years after submitting an 
initial plan under section 803, and not less frequently than 
every four years.
    Section 804(e).--Section 804(e) provides that section 804 
and section 803 are to take effect on the date provided by the 
Secretary pursuant to section 807(a) to provide for timely 
submission and review of the housing plan as necessary for the 
provision of assistance under title VIII of this Act for fiscal 
year 2000.
    Section 805.--Section 805 addresses the treatment of 
program income and labor standards.
    Section 805(a).--Section 805(a) provides that the 
Department of Hawaiian Home Lands may retain any program income 
that is realized from any grant amounts received by the 
Department under title VIII of this Act if that income was 
realized after the initial disbursement of grant amounts 
received by the Department and the Director agrees to use the 
program income for affordable housing activities in accordance 
with the provisions of title VIII of this Act. Section 805(a) 
further provides that the Secretary may not reduce the grant 
amount for the Department of Hawaiian Home Lands based solely 
on whether the Department retains program income under this 
section or the amount of any such program income retained. 
Section 805(a) provides that the Secretary may be regulation, 
exclude from consideration as program income any amounts 
determined to be so small that compliance with the requirements 
of section 805(a) would create an unreasonable administrative 
burden on the Department.
    Section 805(b)(1).--Section 805(b)(1) provides that any 
contract or agreement for assistance, sale, or lease pursuant 
to title VIII of this Act shall contain a provision requiring 
that an amount not less than the wages prevailing in the 
locality, as determined or adopted (subsequent to a 
determination under applicable state or local law) by the 
Secretary, shall be paid to all architects, technical 
engineers, draftsmen, technicians employed in the development 
and all maintenance, and laborers and mechanics employed in the 
operation of the affordable housing project involved, and a 
provision that an amount not less than wages prevailing in the 
locality, as predetermined by the Secretary of Labor pursuant 
to the Act commonly known as the Davis-Bacon Act shall be paid 
to all laborers and mechanics employed in the development of 
the affordable housing involved.
    Section 805(b)(2).--Section 805(b)(2) provides that the 
requirements of section 805(b)(1) and the provisions relating 
to wages required under section 805(b)(1) in any contract or 
agreement for assistance, sale, or lease under title VIII of 
this Act, shall not apply to any individual who performs the 
services for which the individual volunteered and who is not 
otherwise employed at any time in the construction work and 
received no compensation or is paid expenses, reasonable 
benefits, or a nominal fee for those services.
    Section 806.--Section 806 addresses environmental review, 
decision making and action under the National Environmental 
Policy Act.
    Section 806(a)(1)(A).--Section 806(a)(1)(A) provides that 
the Secretary may carry out the alternative environmental 
protection procedures described in section 806(a)(1)(B) in 
order to ensure that the policies of the National Environmental 
Policy Act of 1969 and other provisions of law that further the 
purposes of the Act, as specified in regulations issued by the 
Secretary, are most effectively implemented in connection with 
the expenditure of grant amounts provided under title VIII of 
this Act and to ensure to the public undiminished protection of 
the environment.
    Section 806(a)(1)(B).--Section 806(a)(1)(B) provides that 
in lieu of applying environmental protection procedures 
otherwise applicable, the Secretary may by regulation provide 
for the release of funds for specific projects to the 
Department of Hawaiian Home Lands if the Director of the 
Department assumes all of the responsibilities for 
environmental review, decision-making, and action under the 
National Environmental Policy Act of 1969, and such other 
provisions of law as the regulations of the Secretary specify, 
that would apply to the Secretary were the Secretary to 
undertake those projects as Federal projects.
    Section 806(a)(2).--Section 806(a)(2) provides that the 
Secretary is to issue regulations to carry out section 
806(a)(2) only after consultation with the Council on 
Environmental Quality. Section 806(a)(2) further provides that 
the regulations issued under this paragraph are to provide for 
the monitoring of the environmental reviews performed under 
section 806(a)(2), facilitate training for the performance of 
such reviews if the Secretary in his discretion determines that 
such training is necessary or desirable, and provide for the 
suspension or termination of the assumption of responsibilities 
under section 806(a)(2).
    Section 806(a)(3).--Section 803(a)(3) provides that the 
duty of the Secretary under section 806(a)(2)(B) is not to be 
construed to limit or reduce any responsibility assumed by the 
Department of Hawaiian Home Lands for grant amounts will 
respect to any specific release of funds.
    Section 806(b).--Section 806(b) provides that the Secretary 
is to authorize the release of funds subject to the procedures 
under section 806 only if, not less than fifteen days before 
the Secretary's approval and before any commitment of funds to 
such projects, the Director of the Department of Hawaiian Home 
Lands submits to the Secretary a request for such a release 
accompanied by a certification that meets the requirements of 
section 806(c). Section 806(b) further provides that the 
Secretary's approval of a certification is to be deemed to 
satisfy the Secretary's responsibilities under the National 
Environmental Policy Act of 1969 and such other provisions of 
law as the Secretary's regulations specify to the extent that 
those responsibilities relate to the release of funds for 
projects that are covered by the Secretary's certification.
    Section 806(c).--Section 806(c) provides that a 
certification under the procedures authorized in section 806 
are to be in a form acceptable to the Secretary, be executed by 
the Director of the Department of Hawaiian Home Lands, specify 
that the Department of Hawaiian Home Lands has fully carried 
out it responsibilities as set forth in section 806(a), and 
specify that the Director consents to assume the status of a 
responsible Federal official under the National environmental 
Policy Act of 1969 and each provision of law specified in 
regulations issued by the Secretary to the extent that those 
laws apply be reason of section 806(a). Section 806(c) further 
provides that a certification under this procedures of section 
806(c) shall specify that the Director is authorized and 
consents on behalf of the Department of Hawaiian Home Lands and 
that the Director accepts the jurisdiction of the Federal 
courts for the purpose of enforcement of the responsibilities 
of the Director of the Department of Hawaiian Home lands as 
such an official.
    Section 807.--Section 807 provides that the Secretary shall 
issue final regulations necessary to carry out the provisions 
of title VIII of this Act no later than June 1, 1999.
    Section 808.--Section 808 provides that except as otherwise 
expressly provided in title VII of this Act, title VIII of this 
Act shall take effect on June 1, 1999.
    Section 809.--Section 809 addresses affordable housing 
activities.
    Section 809(a)(1).--Section 809(a)(1) provides that the 
national objectives of title VIII of this Act are to assist and 
promote affordable housing activities to develop, maintain, and 
operate affordable housing in safe and healthy environments for 
occupancy by low-income Native Hawaiian families; to ensure 
better access to private mortgage markets and to promote the 
self-sufficiency of low-income Native Hawaiian families; to 
coordinate activities to promote the self-sufficiency of low-
income Native Hawaiian families; to coordinate activities to 
provide housing for low-income Native Hawaiian families with 
Federal, state and local activities to further economic and 
community development; to plan for and integrate infrastructure 
resources on the Hawaiian Home Lands with housing development; 
and to promote the development of private capital markets, and 
allow the markets to operate and grow, thereby benefitting 
Native Hawaiian communities.
    Section 809(a)(2).--Section 809(a)(2) provides that 
assistance for eligible housing activities under title VII of 
this Act shall be limited to low-income Native Hawaiian 
families except that the Director may provide assistance for 
home ownership activities under section 810(b), model 
activities under section 810(f), or loan guarantee activities 
under section 184A of the Housing and Community Development Act 
of 1992 to Native Hawaiian families who are not low-income 
families, to the extent that the Secretary approves the 
activities under section 184A to address a need for housing for 
those families that cannot be reasonably met without such 
assistance. The Secretary is to establish limitations on the 
amount of assistance that may be provided under the title VIII 
of this Act for activities for families that are not low-income 
families. However, section 809(a)(2) further provides that the 
Director may provide housing or housing assistance provided 
through affordable housing activities assisted with grant 
amounts under this title to a family that is not composed of 
Native Hawaiians if the Department determines that the presence 
of the family in the housing involved is essential to the well-
being of Native Hawaiian families and the need for housing for 
the family cannot be reasonably met without such assistance.
    Section 809(a)(2) provides that a housing plan submitted 
under section 803 may authorize a preference, to the extent 
practicable, for housing or housing assistance provided through 
affordable housing activities assisted with grant amounts 
provided under title VIII of this Act to be provided to 
families that are eligible to reside on the Hawaiian Home 
Lands. In any instance in which a housing plan provides for 
such a preference, the Director is to ensure that housing 
activities which are assisted with grant amounts under title 
VIII of this Act are subject to that preference. Section 
809(a)(2) further provides that as a condition of receiving 
grant amounts under title VIII of this Act, and to the extent 
practicable, the Department of Hawaiian Home Lands is to work 
with or subcontract with private nonprofit organizations 
experienced in the planning and development of affordable 
housing for Native Hawaiians to carry out affordable housing 
activities with those grant amounts.
    Section 810(a).--Section 810(a) provides that affordable 
housing activities under section 810 are activities conducted 
in accordance with the requirement of section 811 to develop or 
to support affordable housing for rental or home ownership or 
provide housing services with respect to affordable housing, 
through the activities described in section 810(b).
    Section 810(b)(1).--Section 810(b)(1) provides that the 
activities described in section 810(b) are the acquisition, new 
construction, reconstruction, or moderate or substantial 
rehabilitation of affordable housing, which may include real 
property acquisition, site improvement, the development of 
utilities and utility services, conversion, demolition, 
financing, administration and planning, and other related 
activities.
    Section 810(b)(2).--Section 810(b)(2) describes the housing 
services which are authorized under title VII of this Act, and 
establishes that the provision of housing-related services for 
affordable housing includes counseling in connection with 
rental or home ownership assistance, the establishment and 
support of resident organizations and resident management 
corporations, energy auditing, activities related to the 
provision of self-sufficiency and other services, and other 
services related to assisting owners, tenants, contractors, and 
other entities participating or seeking to participate in other 
housing activities assisted pursuant to section 810.
    Section 810(b)(3).--Section 810(b)(3) describes the housing 
management services that are authorized under title VIII of 
this Act, and establishes that the provision of management 
services for affordable housing includes the preparation of 
work specifications, loan processing, inspections, tenant 
selection, management of tenant-based rental assistance, and 
management of affordable housing projects.
    Section 810(b)(4).--Section 810(b)(4) establishes that the 
activities authorized under title VIII of this Act include the 
provision of safety, security, and law enforcement measures and 
activities appropriate to protect residents of affordable 
housing from crime.
    Section 810(b)(5).--Section 810(b)(5) establishes that the 
activities authorized under title VIII of this Act include 
housing activities under model programs that are designed to 
carry out the purposes of title VIII and specifically approved 
by the Secretary as appropriate for the purposes of title VIII.
    Section 811(a).--Section 811(a) provides that as a 
condition of receiving grant amounts under title VIII, the 
Director is to develop written policies governing rents and 
home buyer payments charged for dwelling units assisted under 
title VIII, including methods by which such rents and home 
buyer payments are determined. However, in the case of any low-
income family residing in a dwelling unit assisted with grant 
amounts under title VIII, the monthly rent or home buyer 
payment, as applicable, for that dwelling unit may not exceed 
thirty percent of the monthly adjusted income of that family.
    Section 811(b).--Section 811(b) provides that using amounts 
of any grants received under title VIII, the Director is to 
reserve and use for operating under section 810 such amounts as 
may be necessary to provide for the continued maintenance and 
efficient operation of such housing. Section 811(b) further 
provides that section 811(b) may not be construed to prevent 
the Director, or any entity funded by the Department, from 
demolishing or disposing of housing, pursuant to regulations 
established by the Secretary.
    Section 811(c).--Section 811(c) provides that as a 
condition of receiving grant amounts under title VIII, the 
Director is to require adequate insurance coverage for housing 
units that are owned or operated or assisted with grant amounts 
provided under title VIII.
    Section 811(d).--Section 811(d) provides that as a 
condition of receiving grant amounts under title VIII, the 
Director is to develop written policies governing the 
eligibility, admission, and occupancy of families for housing 
assisted with grant amounts provided under title VIII.
    Section 811(e).--Section 811(e) provides that as a 
condition to receiving grant amounts under title VIII, the 
Director is to develop policies governing the management and 
maintenance of housing assisted with grant amounts under title 
VIII.
    Section 812(a).--Section 812(a) provides that subject to 
section 811 and an applicable housing plan approved under 
section 803, the Director is to have the discretion to use 
grant amounts for affordable housing activities through the use 
of equity investments, interest-bearing loans or advances, 
noninterest-bearing loans or advances, interest subsidies, the 
leveraging of private investments, or any other form of 
assistance that the Secretary determines to be consistent with 
the purposes of title VIII, and the right to establish the 
terms of assistance provided with funds referred to in section 
812(a).
    Section 812(b).--Section 812(b) provides authority for the 
Director of the Department of Hawaiian Home Lands to invest 
grant amounts in investment securities and other obligations, 
as approved by the Secretary, for the purposes of carrying out 
affordable housing activities.
    Section 813.--Section 813 addresses low-income requirements 
and income targeting.
    Section 813(a).--Section 813 provides that housing is to 
qualify for affordable housing for purposes of title VIII of 
this Act if the conditions set forth in section 813(a)(1) and 
813(a)(2) are met.
    Section 813(a)(1).--Section 813(a)(1) provides that each 
dwelling unit in the housing will qualify for affordable 
housing if, in the case of rental housing, the housing is made 
available for occupancy only by a family that is a low-income 
family at the time of the initial occupancy by the family of 
that unit, and in the case of housing for homeownership, the 
housing is made available for purchase only by a family that is 
a low-income family at the time of the purchase.
    Section 813(a)(2).--Section 813(a)(2) provides that each 
dwelling unit in the housing will remain affordable housing, in 
accordance with binding commitments satisfactory to the 
Secretary for the remaining useful life of the property, as 
determined by the Secretary, without regard to the term of the 
mortgage or to transfer of ownership, or such other period as 
the Secretary determines is the longest feasible period of time 
consistent with sound economics and the purposes of title VIII 
of this Act, except upon a foreclosure by a lender, or upon 
other transfer in lieu of foreclosure, if that foreclosure or 
transfer action recognizes any contractual or legal rights of a 
public agency, nonprofit sponsor, or other person or entity to 
take an action that would avoid termination of low-income 
affordability, in the case of foreclosure or transfer ownership 
in lieu of foreclosure, and is not for the purpose of avoiding 
low-income affordability restrictions, as determined by the 
Secretary.
    Section 813(b).--Section 813(b) provides that 
notwithstanding the provisions of section 813(a), housing 
assisted pursuant to section 809(a)(2)(B) is to be considered 
affordable housing for purposes of title VIII of this Act.
    Section 814.--Section 814 sets forth the requirements for 
leases and criteria for tenant and homebuyer selection.
    Section 814(a).--Section 814(a) provides that except to the 
extent otherwise provided by or inconsistent with the laws of 
the State of Hawaii, in renting dwelling units in affordable 
housing assisted with grant amounts provided under title VIII 
of this Act, the Director, owner, or manager shall use--
          Leases that do not contain unreasonable terms and 
        conditions; leases that require the Director, owner or 
        manager to maintain the housing in compliance with 
        applicable housing codes and quality standards;
          Leases that require the Director, owner, or manager 
        to give adequate written notice of termination of the 
        lease, which shall be the period of time required under 
        applicable state or local law;
          Leases which specify that, with respect to any notice 
        of eviction or termination, notwithstanding any state 
        or local law, a resident shall be informed of the 
        opportunity, before any hearing or trial, to examine 
        any relevant documents, record, or regulations directly 
        related to the eviction or termination;
          Leases that require the Director, owner, or manager 
        may not terminate the tenancy, during the term of the 
        lease, except for serious or repeated violation of the 
        terms and conditions of the lease, violation of 
        applicable Federal, state, or local law, or for other 
        good cause; and
          Leases that provide that the Director, owner, and 
        manager may terminate the tenancy of a resident for any 
        activity, engaged in by the resident, any member of the 
        household of the resident, or any guest or other person 
        under the control of the resident, that threatens the 
        health or safety of, or right to peaceful enjoyment of 
        the premises by other residents or employees of the 
        Department, owner, or manager; threatens the health or 
        safety of, or right to peaceful enjoyment of their 
        premises by, persons residing in the immediate vicinity 
        of the premises; or is criminal activity, including 
        drug-related criminal activity, on or off the premises.
    Section 814(b).--Section 814(b) provides that as a 
condition of receiving grant amounts under title VIII of this 
Act, the Director shall adopt and use written tenant and 
homebuyer selection policies and criteria that are consistent 
with the purpose of providing housing for low-income families; 
are reasonably related to program eligibility and the ability 
of the applicant to perform the obligations of the lease; and 
provide for the selection of tenants and homebuyers from a 
written waiting list in accordance with the policies and goals 
set forth in an applicable housing plan approved under section 
803; and the prompt notification in writing to any rejected 
applicant of the grounds for that rejection.
    Section 815.--Section 815 provides that if the Department 
of Hawaiian Home Lands uses grant amounts to provide affordable 
housing under activities authorized by title VIII of this Act, 
and at any time during the useful life of the housing, the 
housing does not comply with the requirement under section 
813(a)(2), the Secretary shall reduce future grant payments on 
behalf of the Department by an amount equal to the grant 
amounts used for that housing, under the authority of section 
818(a)(1)(b), or require repayment to the Secretary of any 
amount equal to those grant amounts.
    Section 816.--Section 816 provides that for each fiscal 
year, the Secretary shall allocate any amounts made available 
for assistance under this title for the fiscal year, in 
accordance with the formula established pursuant to section 
817, to the Department of Hawaiian Home Lands if the Department 
complies with the requirements under title VIII of this Act for 
a grant under title VIII of this Act.
    Section 817.--Section 817 addresses the establishment of an 
allocation formula for the allocation of amounts made available 
for block grants and the factors for the determination of need.
    Section 817(a).--Section 817(a) provides that the Secretary 
shall, by regulation issued not later than the expiration of 
the six-month period beginning on the date of enactment of the 
Native American Housing Assistance and Self-Determination 
Amendments of 1998, in the manner provided under section 807, 
establish a formula to provide for the allocation of amounts 
available for a fiscal year for block grants under title VIII 
of this Act in accordance with the requirements of section 817.
    Section 817(b).--Section 817(b) provides that the formula 
established under the authority of section 817(a) is to be 
based on factors that reflect the needs for assistance for 
affordable housing activities, including the number of low-
income dwelling units owned or operated at the time pursuant to 
a contract between the Director and the Secretary; the extent 
of poverty and economic distress and the number of Native 
Hawaiian families eligible to reside on the Hawaiian Home 
Lands; and any other objectively measurable conditions that the 
Secretary and the Director may specify.
    Section 817(c).--Section 817(c) provides that in 
establishing the formula under the authority of section 817(a), 
the Secretary is to consider the relative administrative 
capacities of the Department of Hawaiian Home Lands and other 
challenges faced by the Department, including geographic 
distribution within Hawaiian Home Lands, and technical 
capacity.
    Section 817(d).--Section 817(d) provides that section 817 
is to take effect on the date of enactment of the Native 
American Housing Assistance and Self-Determination Amendments 
of 1998.
    Section 818.--Section 818 addresses the remedies available 
to the Secretary for failure to comply with the requirements of 
title VIII of this Act.
    Section 818(a).--Section 818(a) provides that except as 
provided in section 818(b), if the Secretary finds after 
reasonable notice and opportunity for a hearing that the 
Department of Hawaiian Home Lands has failed to comply 
substantially with any provision of title VIII of this Act, the 
Secretary shall terminate payments to the Department under 
title VIII of this Act; reduce payments to the Department under 
title VIII of this Act by an amount equal to the amount of such 
payments that were not expended in accordance with title VIII 
of this Act; or limit the availability of payments under title 
VIII of this Act to programs, projects, or activities not 
affected by the failure to comply. If the Secretary takes any 
of the actions authorized under section 818(a), the Secretary 
is to continue that action until the Secretary determines that 
the failure by the Department to comply with the provision has 
been remedied by the Department and the Department is in 
compliance with that provision.
    Section 818(b).--Section 818(b) provides that the Secretary 
may provide technical assistance for the Department, either 
directly or indirectly, that is designed to increase the 
capability and capacity of the Director of the Department to 
administer assistance provided under title VIII of this Act in 
compliance with the requirements under title VIII of this Act, 
if the Secretary makes a finding under section 818(a) but 
determines that the failure of the Department to comply 
substantially with the provisions of title VIII of this Act is 
not a pattern or practice of activities constituting willful 
noncompliance and is a result of the limited capability or 
capacity of the Department of Hawaiian Home Lands.
    Section 818(c).--Section 818(c) provides that in lieu of, 
or in addition to any action that the Secretary may take under 
section 818(a), if the Secretary has reason to believe that the 
Department of Hawaiian Home Lands has failed to comply 
substantially with any provision of title VIII of this Act, the 
Secretary may refer the matter to the Attorney General of the 
United States with a recommendation than an appropriate civil 
action be instituted. Upon receiving the Secretary's referral, 
the Attorney General may bring a civil action in any United 
States district court of appropriate jurisdiction for such 
relief as may be appropriate, including an action to recover 
the amount of the assistance furnished under title VIII of this 
Act that was not expended in accordance with title VIII of this 
Act or for mandatory or injunctive relief.
    Section 818(d)(1).--Section 818(d)(1) provides that if the 
Director receives notice under section 818(a) of the 
termination, reduction, or limitation of payments under this 
Act, the Director may, not later than sixty days after 
receiving such notice, file with the United States Court of 
Appeals for the Ninth Circuit, or in the United States Court of 
Appeals for the District of Columbia, a petition for review of 
the action of the Secretary, and upon the filing of any 
petition, the Director is to transmit copies of the petition to 
the Secretary and the Attorney General of the United States, 
who shall represent the Secretary in the litigation.
    Section 818(d)(2).--Section 818(d)(2) provides that the 
Secretary shall file in a court a record of the proceeding on 
which the Secretary based the action as provided in section 
2112 of title 28, United States Code. No objection to the 
action of the Secretary is to be considered by the court unless 
the Department has registered objection before the Secretary.
    Section 818(d)(3).--Section 818(d)(3) provides that the 
court shall have jurisdiction to affirm or modify the action of 
the Secretary or to set the action aside in whole or in part. 
If supported by substantial evidence on the record considered 
as a whole, the findings of fact by the Secretary shall be 
conclusive. The court may order evidence, in addition to the 
evidence submitted for review under section 818(d)(3), to be 
taken by the Secretary, and to be made part of the record. By 
reason of additional evidence and evidence filed with the 
court, the Secretary may modify his findings of fact or make 
new findings, and shall file such modified or new findings and 
his recommendation, if any, for the modification or setting 
aside of the original action of the Secretary. With respect to 
a question of fact, the findings shall be considered to be 
conclusive if those findings are supported by substantial 
evidence on the record, and considered as a whole.
    Section 818(d)(4).--Section 818(d)(4) provides that except 
for review by the U.S. Supreme Court, upon the filing of the 
record under section 818(d)(4) with the court, the jurisdiction 
of the court shall be exclusive and the judgment of the court 
shall be final. A judgment from the court under section 
818(d)(4) shall be subject to review by the U.S. Supreme Court 
upon writ of certiorari or certification as provided in section 
1254 of title 28, United States Code.
    Section 819.--Section 819 addresses the monitoring of 
compliance by the Director of the Department of Hawaiian Home 
Lands.
    Section 819(a).--Section 819(a) provides that the Director, 
through binding contractual agreements with owners or other 
authorized entities shall ensure long-term compliance with the 
provisions of title VIII of this Act. The binding contractual 
agreements with owners or other authorized entities shall 
provide for the enforcement of the provisions of title VIII of 
this Act by the Department and the Secretary to the extent 
allowable by Federal and state law, and remedies for breach of 
the provisions of the binding contractual agreements.
    Section 819(b).--Section 819(b) provides that not less 
frequently than annually, the Director shall review the 
activities conducted and housing assisted under title VIII of 
this Act, to assess compliance with requirements of title VIII 
of this Act. Each review is to include onsite inspection of 
housing to determine compliance with applicable requirements. 
The results of each review shall be included in a performance 
report of the Director submitted to the Secretary under section 
820 and made available to the public.
    Section 819(c).--Section 819(c) provides that the Secretary 
is to establish such performance measures as may be necessary 
to assess compliance with the requirements of title VIII of 
this Act.
    Section 820.--Section 820 addresses the requirements for 
performance reports.
    Section 820(a).--Section 820(a) provides that for each 
fiscal year, the Director is to review the progress the 
Department has made during that fiscal year in carrying out the 
housing plan submitted by the Department under section 803, and 
submit a report to the Secretary, in a form acceptable to the 
Secretary, describing the conclusions of the review.
    Section 820(b).--Section 820(b) provides that each 
performance report submitted for a fiscal year is to describe 
the use of grant amounts provided to the Department of Hawaiian 
Home Lands for that fiscal year, and assess the relationship of 
the use of grant amounts to the goals identified in the housing 
plan submitted under section 803 as a result of its 
experiences.
    Section 820(c).--Section 820(c) provides that the Secretary 
is to establish a date for the submission of each performance 
report, review each performance report, and with respect to 
each performance report, make such recommendations as the 
Secretary considers appropriate to carry out the purposes of 
title VIII of this Act.
    Section 820(d).--Section 820(d) provides that in preparing 
a performance report, the Director shall make the report 
publicly available to the beneficiaries of the Hawaiian Homes 
Commission Act, 1920, and give a sufficient amount of time to 
permit those beneficiaries to comment on that report before it 
is submitted to the Secretary, in such manner and at such time 
as the Director may determine. The report is to include a 
summary of any comments received by the Director from 
beneficiaries regarding the program to carry out the housing 
plan.
    Section 821.--Section 821 provides authority for annual 
performance reviews and audits by the Secretary.
    Section 821(a).--Section 821(a) provides that the Secretary 
shall not less frequently than on an annual basis, make such 
reviews and audits as may be necessary or appropriate to 
determine whether the Director has carried out eligible 
activities under title VIII of this Act in a timely manner, has 
carried out and made certifications in accordance with the 
requirements and the primary objectives of title VIII of this 
Act and with other applicable laws; and has a continuing 
capacity to carry out the eligible activities in a timely 
manner; whether the Director has complied with the housing plan 
submitted by the Director under section 803, and whether the 
performance reports of the Department under section 821 are 
accurate. Each review conducted under section 821 shall, to the 
extent practicable, include onsite visits by employees of the 
Department of Housing and Urban Development.
    Section 821(b).--Section 821(b) provides that the Secretary 
is to give the Department of Hawaiian Home Lands not less than 
thirty days to review and comment on a report under section 
821(b). After taking into consideration the comments of the 
Department, the Secretary is authorized to revise the report 
and to make the comments of the Department and the report, with 
any revisions, readily available to the public not later than 
thirty days after receipt of the Department's comments.
    Section 821(c).--Section 821(c) provides that the Secretary 
may make appropriate adjustments in the amount of annual grants 
under title VIII of this Act in accordance with the findings of 
the Secretary pursuant to reviews and audits under section 821. 
The Secretary may adjust, reduce, or withdraw grant amounts, or 
take other action as appropriate in accordance with the reviews 
and audits of the Secretary under section 821, except that 
grant amounts already expended on affordable housing activities 
may not be recaptured or deducted from future assistance 
provided to the Department of Hawaiian Home Lands.
    Section 822.--Section 822 provides that to the extent the 
financial transactions of the Department of Hawaiian Home Lands 
involving grant amounts under title VIII of this Act relate to 
amounts provided under title VIII, those transactions may be 
audited by the Comptroller General of the United States under 
such regulations as may be prescribed by the Comptroller 
General. The Comptroller General of the United States shall 
have access to all books, accounts, records, reports, files, 
and other papers, things, or property belonging to or in use by 
the Department of Hawaiian Home Lands pertaining to such 
financial transactions and necessary to facilitate the audit.
    Section 823.--Section 823 provides that no later than 
ninety days after the conclusion of each fiscal year in which 
assistance under title VIII of this Act is made available, the 
Secretary shall submit a report to the Congress that contains a 
description of the progress made in accomplishing the 
objectives of title VIII of this Act, a summary of the use of 
funds available under title VIII of this Act during the 
preceding fiscal year, and a description of the aggregate 
outstanding loan guarantees under section 184A of the Housing 
and Community Development Act of 1992. The Secretary may 
require the Director to submit such reports and other 
information as may be necessary in order for the Secretary to 
prepare the report required under section 823(a).
    Section 824.--Section 824 provides authority for the 
appropriation of funds for the Department of Housing and Urban 
Development for grants under title VIII of this Act of such 
sums as may be necessary for each of fiscal year 1999, 2000, 
2001, 2002 and 2003.
    Section 4.--Section 4 amends subtitle E of title I of the 
Housing and Community Development Act of 1992 by inserting 
after section 184, the following provisions--
    Section 184A.--Section 184A provides for loan guarantees 
for Native Hawaiian Housing.
    Section 184A(a)--Section 184A(a) establishes the 
definitions for purposes of the amendment to subtitle E of 
title I of the Housing and Community Development Act of 1992.
    Section 184A(a)(1).--Section 184A(a)(1) provides that for 
purposes of section 184A, the term ``Department of Hawaiian 
Home Lands'' means the agency or department of the government 
of the State of Hawaii that is responsible for the 
administration of the Hawaiian Homes Commission Act, 1920.
    Section 184A(a)(2).--Section 184A(a)(2) provides that for 
purposes of section 184A, the term ``eligible entity'' means a 
Native Hawaiian family, the Department of Hawaiian Home Lands, 
the Office of Hawaiian Affairs, or private nonprofit or for 
profit organizations experienced in the planning and 
development of affordable housing for Native Hawaiian.
    Section 184A(a)(3).--Section 184A(a)(3) provides that for 
purposes of section 184A, the term ``family'' means one or more 
persons maintaining a household, as the Secretary shall by 
regulation provide.
    Section 184A(a)(4).--Section 184A(a)(4) provides that for 
purposes of section 184A, the term ``guarantee fund'' means the 
Native Hawaiian Housing Loan Guarantee Fund established under 
section 184A(i).
    Section 184A(a)(5).--Section 184A(a)(5) provides that for 
purposes of section 184A, the term ``Hawaiian Home Lands'' 
means lands that have the status of Hawaiian Home Lands under 
section 204 of the Hawaiian Homes Commission Act, 1920, or 
lands that are acquired pursuant to that Act.
    Section 184A(a)(6).--Section 184A(a)(6) provides that for 
purposes of section 184A, the term ``Native Hawaiian'' has the 
meaning given the term ``Native Hawaiian'' in section 201 of 
the Hawaiian Homes Commission Act, 1920, as amended.
    Section 184A(a)(7).--Section 184A(a)(7) provides that for 
purposes of section 184A, the term ``Office of Hawaiian 
Affairs'' means the entity of that name established under the 
constitution of the State of Hawaii, as amended.
    Section 184A(b).--Section 184A(b) provides that in order to 
provide access to sources of private financing to Native 
Hawaiian families who otherwise could not acquire housing 
financing because of the unique legal status of the Hawaiian 
Home Lands or as a result of a lack of access to private 
financial markets, the Secretary may guarantee an amount not to 
exceed one hundred percent of the unpaid principal and interest 
that is due on an eligible loan under section 184A(b).
    Section 184A(c).--Section 184A(c) establishes the 
requirements for an eligible loan.
    Section 184A(c)(1).--Section 184A(c)(1) provides that a 
loan is an eligible loan if that loan is made only to a 
borrower who is a Native Hawaiian family, the Department of 
Hawaiian Home Lands, the Office of Hawaiian Affairs, or a 
private nonprofit organization experience in the planning and 
development of affordable housing for Native Hawaiians.
    Section 184A(c)(2).--Section 184A(c)(2) provides that a 
loan is an eligible loan if the loan will be used to construct, 
acquire, or rehabilitate not more than four-family dwellings 
that are standard housing and are located on Hawaiian Home 
Lands for which a housing plan submitted under section 803 of 
the Native American Housing Assistance and Self-Determination 
Amendments of 1998 applies. The housing plan must be approved 
by the secretary and must provide for the use of loan 
guarantees under section 184A to provide affordable housing on 
Hawaiian Home Lands.
    Section 184A(c)(3).--Section 184A(c)(3) provides that the 
loan may be secured by any collateral authorized under 
applicable Federal or state law.
    Section 184A(c)(4)(A).--Section 184A(c)(4)(A) provides that 
the loan shall be made only by a lender approved by, and 
meeting qualifications established by the Secretary including 
any lender described in section 184A(c)(4)(B), except that a 
loan otherwise insured or guaranteed by an agency of the 
Federal government or made by the Department of Hawaiian Home 
Lands from amounts borrowed from the United States shall not be 
eligible for a guarantee under section 184A.
    Section 184A(c)(4)(B).--Section 184A(c)(4)(B) provides that 
the following lenders shall be considered to be lenders that 
have been approved by the Secretary--
          Any mortgagee approved by the Secretary for 
        participation in the single family mortgage insurance 
        program under title II of the National Housing Act.
          Any lender that makes housing loans under chapter 37 
        of title 38, Untied States Code, that are automatically 
        guaranteed under section 3702(d) of title 38, United 
        States Code.
          Any lender approved by the Secretary of Agriculture 
        to make guaranteed loans for single family housing 
        under the Housing Act of 1949.
          Any other lender that is supervised, approved, 
        regulated, or insured by any agency of the Federal 
        government.
    Section 184A(c)(5).--Section 184A(c)(5) provides that the 
loan shall be made for a term not exceeding thirty years, and 
bear interest, exclusive of the guarantee fee under section 
184A(d) and service charges, if any, at a rate agreed upon by 
the borrower and the lender and determined by the Secretary to 
be reasonable, but not to exceed the rate generally charged in 
the area, as determined by the Secretary, for home mortgage 
loans not guaranteed or insured by any agency or 
instrumentality of the Federal government. The section further 
provides that the loan must involve a principal obligation not 
exceeding 97.75 percent of the appraised value of the property 
as of the date of the loan is accepted for guarantee, or 98.75 
percent if the value of the property is $50,000 or less, or the 
amount approved by the Secretary under section 184A(c) and 
involve a payment on account of the property in cash or its 
equivalent or through the value of any improvements to the 
property made through the skilled or unskilled labor of the 
borrower, as the Secretary shall provide.
    Section 184A(d).--Section 184A(d) provides that before the 
Secretary approves any loan for guarantee under section 
184A(d), the lender shall submit the application for the loan 
to the Secretary for examination and if the Secretary approves 
the application, the Secretary shall issue a certificate under 
section 184A(d) as evidence of the loan guarantee approved. The 
Secretary may approve a loan for guarantee under section 
184A(d) only if he determines that there is a reasonable 
prospect of repayment of the loan. A certificate of guarantee 
issued under section 184A(d) by the Secretary is to serve as 
conclusive evidence of the eligibility of the loan for 
guarantee under section 184A(d) and the amount of that 
guarantee, and shall be incontestable in the hands of the 
bearer. The full faith and credit of the United States is 
pledged to the payment of all amounts agreed to be paid by the 
Secretary as security for the obligations made by the Secretary 
under section 184A(d). Section 184A(d) may not be construed to 
preclude the Secretary from establishing defenses against the 
original lender based on fraud or material misrepresentation or 
to bar the Secretary from establishing by regulations that are 
on the date of issuance or disbursement, whichever is earlier, 
partial defenses to the amount payable on the guarantee.
    Section 184A(e) provides that the Secretary shall fix and 
collect a guarantee fee for the guarantee of a loan under 
section 184A(e) which may not exceed the amount equal to one 
percent of the principal obligation of the loan. The fee under 
section 184A(e) is to be paid by the lender at time of issuance 
of the guarantee and be adequate to cover expenses and probable 
losses. The Secretary is to deposit any fees collected under 
section 184A(e) in the Native Hawaiian Housing Loan Guarantee 
Fund established under section 184A(j).
    Section 184A(f).--Section 184A(f) provides that the 
liability under a guarantee provided under section 184A shall 
decrease or increase on a pro rata basis according to any 
decrease or increase in the amount of the unpaid obligation 
under the provisions of the loan agreement involved.
    Section 184A(g).--Section 184A(g) provides that 
notwithstanding any other provision of law, any loan guaranteed 
under section 184A, including the security given for the loan, 
may be sold or assigned by the lender to any financial 
institution subject to examination and supervision by an agency 
of the Federal government or of any state or the District of 
Columbia.
    Section 184A(h).--Section 184A(h) provides that if the 
Secretary determines that any lender or holder of a guarantee 
certificate under section 184A(c) has failed to maintain 
adequate accounting records, or to adequately service loans 
guaranteed under section 184A, or to exercise proper credit or 
underwriting judgment, or has engaged in practices otherwise 
detrimental to the interest of a borrower or the United States, 
the Secretary may take such actions as are authorized in 
section 184A(h). Upon a determination by the Secretary that a 
holder of a guarantee certificate under section 184A(c) has 
failed to carry out an activity outlined in section 184A(h) or 
has engaged in practices described in section 184A(h), the 
Secretary is authorized to refuse, either temporarily or 
permanently, to guarantee any further loans made by such lender 
or holder, bar such lender or holder from acquiring additional 
loans guaranteed under section 184A, and require that such 
lender or holder assume not less than ten percent of any loss 
on further loans made or held by the lender or holder that are 
guaranteed under section 184A. In addition, the Secretary may 
impose a civil monetary penalty on a lender or holder of a 
guarantee certificate under the section 184A(d) if the 
Secretary determines that the holder or lender has 
intentionally failed to maintain adequate accounting records, 
to adequately service loans guaranteed under section 184A, or 
to exercise proper credit or underwriting judgment. A civil 
monetary penalty imposed under section 184A(h) is to be imposed 
in the manner and be in an amount provided under section 536 of 
the National Housing Act with respect to mortgages and lenders 
under that Act. However, notwithstanding the preceding 
provisions of section 184A(h), if a loan was made in good 
faith, the Secretary may not refuse to pay a lender or holder a 
valid guarantee on that loan, without regard to whether the 
lender or holder is barred under section 184A(h).
    Section 184A(i).--Section 184A(i) provides that if a 
borrower on a loan guaranteed under section 184A defaults on 
the loan, the holder of the guarantee certificate is to provide 
written notice of the default to the Secretary. Upon providing 
the notice to the Secretary, the holder of the guarantee 
certificate shall be entitled to payment under the guarantee, 
subject to the provisions of section 184A, and may proceed to 
obtain payment in one of the following manners--
          The holder may initiate foreclosure proceedings, 
        after providing written notice of that action to the 
        Secretary.
          Upon a final order by the court authorizing 
        foreclosure and submission to the Secretary of a claim 
        for payment under the guarantee, the Secretary shall 
        pay to the holder of the certificate the pro rata 
        portion of the amount guaranteed, as determined 
        pursuant to section 184A(f), plus reasonable fees and 
        expenses as approved by the Secretary.
          The rights of the Secretary shall be subrogated to 
        the rights of the holder of the guarantee. The holder 
        shall assign the obligation and security to the 
        Secretary.
          Without seeking foreclosure, or in any case in which 
        a foreclosure proceeding which has been initiated 
        continues for a period in excess of one year, the 
        holder of the guarantee may submit to the Secretary a 
        request to assign the obligation and security interest 
        to the Secretary in return for payment of the claim 
        under the guarantee. The Secretary may accept 
        assignment of the loan if the Secretary determines that 
        the assignment is in the best interest of the United 
        States.
          Upon assignment, the Secretary shall pay to the 
        holder of the guarantee the pro rata portion of the 
        amount guaranteed, as determined under section 184A(f).
          The rights of the Secretary shall be subrogated to 
        the rights of the holder of the guarantee. The holder 
        shall assign the obligation and security to the 
        Secretary.
    Section 184A(i) further provides that before any payment 
under a guarantee is made, the holder of the guarantee shall 
exhaust all reasonable possibilities of collection. Upon 
payment, in whole or in part, to the holder, the note or 
judgment evidencing the debt shall be assigned to the United 
States and the holder shall have no further claim against the 
borrower or the United States.
    Section 184A(i) also authorizes the Secretary to take such 
action to collect payment from the borrower as the Secretary 
determines to be appropriate. If a borrower defaults on a loan 
guaranteed under section 184A that involves a security interest 
in restricted Hawaiian Home Land property, the mortgagee or the 
Secretary shall only pursue liquidation after offering to 
transfer the account to another eligible Hawaiian family or to 
the Department of Hawaiian Home Lands. Thereafter, if the 
mortgagee or the Secretary subsequently proceeds to liquidate 
the account, the mortgagee or the Secretary shall not sell, 
transfer, or otherwise dispose of or alienate the property 
except to another eligible Hawaiian family or to the Department 
of Hawaiian Home Lands.
    Section 184A(j)(1).--Section 184A(j)(1) provides 
authorization for the establishment in the United States 
Treasury a fund to be known as the Hawaiian Housing Loan 
Guarantee Fund for the purpose of providing loan guarantees 
under section 184A.
    Section 184A(j)(2).--Section 184A(j)(2) provides that the 
Guarantee Fund is to be credited with: any amount, claims, 
notes, mortgages, contracts, and property acquired by the 
Secretary under section 184A and any collections and proceeds 
therefrom; any amounts appropriated pursuant to section 
184A(j)(7); any guarantee fees collected under section 184A(d) 
and any interest or earnings on amounts invested under section 
184A(j)(4).
    Section 184A(j)(3).--Section 184A(j)(3) provides that the 
amounts in the Guarantee Fund shall be available, to the extent 
provided in appropriations Act, for--
          Fulfillng any obligations of the Secretary with 
        respect to loans guaranteed under section 184A, 
        including the costs, as that term is defined in section 
        502 of the Federal Credit Reform Act of 1990, of such 
        loans;
          Paying taxes, insurance, prior liens, expenses 
        necessary to make fiscal adjustment in connection with 
        the application and transmittal of collections, and 
        other expenses and advances to protect the Secretary 
        for loans which are guaranteed under section 184A or 
        held by the Secretary;
          Acquiring such security property at foreclosure sales 
        or otherwise;
          Paying administrative expenses in connection with 
        section 184A; and
          Reasonable and necessary costs of rehabilitation and 
        repair to properties that the Secretary holds or owns 
        pursuant to section 184A.
    Section 184A(j)(4).--Section 184A(j)(4) provides that any 
amounts in the Guarantee Fund determined by the Secretary to be 
in excess of amounts currently required at the time of the 
determination to carry out section 184A may be invested in 
obligations of the United States.
    Section 184A(j)(5).--Section 184A(j)(5) provides that the 
authority of the Secretary to enter into commitments to 
guarantee loans under section 184A shall be effective for any 
fiscal year to the extend, or in such amounts as, are or have 
been provided in appropriations Acts, without regard to the 
fiscal year for which such amounts were appropriated. Section 
184A(j)(5) further provides that the authority of the Secretary 
to enter into commitments to guarantee loans under section 184A 
shall be effective for any fiscal year only to the extent that 
amounts in the Guarantee Fund are or have been made available 
in appropriations Acts to cover the costs, as that term is 
defined in section 502 of the Federal Credit Reform Act of 
1990, of such loan guarantees for such fiscal year. Any amounts 
appropriated pursuant to section 184A(j)(5) shall remain 
available until expended. Subject to these limitations, the 
Secretary may enter into commitments to guarantee loans under 
section 184A for each of fiscal years 1999, 2000, 2001, 2002, 
and 2003 with an aggregate outstanding principal amount not 
exceeding $100,000,000 for each fiscal year.
    Section 184A(j)(6).--Section 184A(j)(6) provides that all 
liabilities and obligations of the assets credited to the 
Guarantee Fund under section 184A(j)(2) shall be liabilities 
and obligations of the Guarantee Fund.
    Section 184A(j)(7).--Section 184(j)(7) provides 
authorization for appropriations to the Guarantee Fund to carry 
out section 184A such sums as necessary be necessary for each 
of fiscal years 1999, 2000, 2001, 2002, and 2003.
    Section 184A(k)(1).--Section 184A(k)(l) provides that the 
Secretary shall, by regulation, establish housing safety and 
quality standards to be applied for use under section 184A.
    Section 184A(k)(2).--Section 184A(k)(2) provides that the 
standards are to provide sufficient flexibility to permit the 
use of various designs and materials in housing acquired with 
loans guaranteed under section 184A and require each dwelling 
unit in any housing to be decent, safe, sanitary, and modest in 
size and design; conform with applicable general construction 
standards for the region in which the housing is located; 
contain a plumbing system that uses a properly installed system 
of piping, includes a kitchen sink and a partitional bathroom 
with lavatory, toilet, and bath or shower, and uses water 
supply, plumbing, and sewage disposal systems that conform to 
any minimum standards established by the applicable country or 
state; contain an electrical system using wiring and equipment 
properly installed to safely supply electrical energy for 
adequate lighting and for operation of appliances that conforms 
to any appropriate country, state or national code; be not less 
than the size provided under the applicable locally-adopted 
standards for size of dwelling units, except that the 
Secretary, upon request of the Department of Hawaiian Home 
Lands, may waive the size requirements under section 
184A(k)(2); and conform with the energy performance 
requirements for new construction established by the Secretary 
under section 526(a) of the National Housing Act, unless the 
Secretary determines that the requirements are not applicable.
    Section 184A(l).--Section 184A(l) provides that to the 
extent that the requirements of title VI of the Civil Rights 
Act of 1964 or of title VIII of the Civil Rights Act of 1968 
apply to a guarantee provided under section 184A(l), nothing in 
the requirements concerning discrimination on the basis of race 
shall be construed to prevent the provision of the guarantee to 
an eligible entity on the basis that the entity serves Native 
Hawaiian families or is a Native Hawaiian family.

                   Cost and Budgetary Considerations

    The cost estimate for S. 109, as amended, as provided by 
the Congressional Budget Office, is set forth below:

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 22, 1998.
Hon. Ben Nighthorse Campbell,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 109, Native American 
Housing Assistance and Self-Determination Amendments of 1998.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts for federal 
costs are Carla Pedone and Susanne Mehlman. The contact for 
state and local impact is Leo Lex.
            Sincerely,
                                         June E. O'Neill, Director.

               Congressional Budget Office Cost Estimate

S.109--Native American Housing Assistance and Self-Determination 
        Amendments of 1998

    Summary.--S.109 would expand housing assistance of Native 
Hawaiians by extending to them the same types of federal 
housing programs available to American Indians and Alaska 
Natives (AIANs). The bill would authorize block grants for 
affordable housing activities by amending the Native American 
Housing Assistance and Self-Determination Act of 1996 
(NAHASDA). In addition, it would provide loan guarantees for 
mortgages for owner- or renter-occupied housing by amending 
section 184 of the Housing and Community Development Act of 
1992.
    S. 109 would authorize appropriations totaling an estimated 
$215 million over the fiscal years 1999 through 2003, assuming 
adjustments for inflation. Without adjustments for inflation 
the total amount authorized would be an estimated $205 million. 
CBO estimates that enactment of the bill would not affect 
direct spending and would have a negligible effect on receipts. 
Nevertheless, pay-as-you go procedures would apply.
    This bill would impose no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
(UMRA).
    Estimated cost to the Federal Government.--The estimated 
budgetary impact of S. 109 is shown in Table 1. CBO estimates 
that the bill would authorize appropriations of $41 million in 
1999; authorizations would increase to $45 million in 2003 
assuming adjustments for inflation. Outlays from those 
appropriations would total $3 million in 1999, increasing to 
$39 million in 2003 with adjustments for inflation and to $37 
million without adjustments for inflation.

                                TABLE 1. ESTIMATED COST TO THE FEDERAL GOVERNMENT
----------------------------------------------------------------------------------------------------------------
                                                                      By fiscal year, in millions of dollars
                                                                 -----------------------------------------------
                                                                   1998    1999    2000    2001    2002    2003
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION
                                         With Adjustments for Inflation
Spending under current law:
    Estimated authorization level \1\...........................     605     646     661     676       0       0
    Estimated outlays...........................................      73     240     383     508     514     449
 Proposed changes:
    Estimated authorization level...............................       0      41      42      43      44      45
    Estimated outlays...........................................       0       3      16      26      33      39
Spending under S. 109:
    Estimated authorization level \1\...........................     605     687     703     719      44      45
    Estimated outlays...........................................      73     243     399     534     547     488
                                        Without Adjustments for Inflation
Spending under current law:
    Estimated authorization level \1\...........................     605     633     633     633       0       0
    Estimated outlays...........................................      73     239     379     496     497     431
Proposed changes:
    Estimated authorization level...............................       0      41      41      41      41      41
    Estimated outlays...........................................       0       3      16      25      32      37
Spending under S. 109
    Estimated authorization level \1\...........................     605     674     674     674      41      41
    Estimated outlays...........................................      73     242     395     521     529     468
----------------------------------------------------------------------------------------------------------------
\1\ The 1998 level is the amount appropriated for that year for NAHASDA and Indian Loan guarantees. The levels
  in subsequent years are estimated authorization amounts.

    The costs of this legislation fall within budget functions 
370 (commerce and housing credit) and 600 (income security).
    Basis of estimate.--The bill stipulates that the provisions 
would take effect on June 1, 1999. CBO assumes that the 
authorized amounts would be fully funded each fiscal year.
            Block grants for affordable housing activities
    Section 3 of S. 109 would add title VIII--Housing 
Assistance for Native Hawaiians--to NAHASDA. That title would 
make Native Hawaiians eligible for the types of block grants 
that are available under current law to American Indians and 
Alaska Natives. The block grants would be provided by the 
Department of Housing and Urban Development (HUD) to the 
Department of Hawaiian Home Lands, an agency of the government 
of the state of Hawaii. That agency would in turn distribute 
the grants by formula to the various areas of Hawaiian Home 
Lands eligible to receive funds. Activities eligible for 
funding would include the acquisition, development, and 
rehabilitation of affordable rental or owner-occupied housing, 
and the provision of housing services such as home ownership 
counseling, self-sufficiency counseling, housing management 
services, and crime prevention activities. The housing 
assistance would generally be limited to Native Hawaiian 
families who live on or near Hawaiian Home Lands and who have 
incomes not exceeding 80 percent of the area median income, 
adjusted for family size. Under the bill's definition, Native 
Hawaiians are people with at least 50 percent Hawaiian 
ancestry--an estimated 69,000 persons at present.
    S. 109 would authorize, for each of the fiscal years 1999 
through 2003, the appropriations necessary to carry out the 
block grant program for Native Hawaiians. CBO estimates that 
the authorization for fiscal year 1999 would be $33 million, 
increasing gradually with inflation to $37 million in 2003 (see 
Table 2).
    The estimated amounts are based on the assumption that 
appropriations for the Native Hawaiian block grants would be 
proportional to the amount that was appropriated for fiscal 
1998 under NAHASDA. The proportion was estimated so as to 
reflect the need for assistance to Native Hawaiians relative to 
the need for all tribes, with need defined by current 
regulations. Under current policy, a share of annual 
appropriations is first allocated to operate and maintain 
existing federally assisted Indian housing. Native Hawaiians 
would not qualify for this funding component because there is 
no federally assisted housing on the Hawaiian Home Lands. The 
remaining funds are distributed among Indian tribes according 
to a needs-based formula, which is based on seven factors, 
including the number of persons in the tribe, the number of 
households with various types of housing problems, and the 
number of households in various income categories. The 
percentage of funds each tribe receives is adjusted further for 
local housing development costs relative to the national 
average.

            TABLE 2. ESTIMATED AUTHORIZATIONS BY PROGRAM TYPE
------------------------------------------------------------------------
                                  By fiscal year, in millions of dollars
                                 ---------------------------------------
                                   1999    2000    2001    2002    2003
------------------------------------------------------------------------
                    SPENDING SUBJECT TO APPROPRIATION
                     With Adjustments for Inflation
Block grants:
    Estimated authorization
     level......................      33      34      35      36      37
    Estimated outlays...........       1       7      15      25      31
Loan guarantees:
    Estimated authorization
     level......................       8       8       8       8       8
    Estimated outlays...........       2       9      11       8       8
Total:
    Estimated authorization
     level......................      41      42      43      44      45
    Estimated outlays...........       3      16      26      33      39
                    Without Adjustments for Inflation
Block grants:
    Estimated authorization
     level......................      33      33      33      33      33
    Estimated outlays...........       1       6      14      24      29
Loan guarantees:
    Estimated authorization
     level......................       8       8       8       8       8
    Estimated outlays...........       2       9      11       8       8
Total:
    Estimated authorization
     level......................      41      41      41      41      41
    Estimated outlays...........       3      15      25      32      37
------------------------------------------------------------------------

    Based on data provided by HUD, the Department of Hawaiian 
Home Lands, and a recent study by the Urban Institute on 
housing problems of Native Hawaiians, CBO estimates that in 
1998 Native Hawaiians would have received roughly 8.6 percent 
of the needs-based component if they had been eligible for 
NAHASDA funding. In 1998, that component amounted to $347 
million of the $600 million appropriated under NAHASDA. In 
order not to diminish funding for AIANs, it would be necessary 
to increase the needs-based component by about 9.4 percent or 
$33 million.
            Loan guarantees
    Section 4 of S. 109 would establish a loan guarantee 
program for Native Hawaiian housing similar to the current 
Indian Housing Loan Guarantee program authorized under section 
184 of the Housing and Community Development Act of 1992. HUD 
would be authorized to guarantee up to $100 million of loans 
each fiscal year over the 1999-2003 period. CBO assumes that 
the 1999 subsidy rate for such loan guarantees would be similar 
to that under the existing program--about 8.13 percent. CBO 
estimates that such a program would require an appropriation of 
about $8 million in fiscal year 1999 and total appropriations 
of about $40 million over the next five years (see Table 2).
    Section 4 also would provide for civil penalties against 
lenders or holders of a guarantee certificate who have 
intentionally failed to meet certain requirements. Payments of 
such penalties would be recorded as miscellaneous receipts to 
the Treasury. CBO expects that any increase in penalty 
collections would be insignificant.
    Pay-as-you-go considerations.--The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. Because 
the civil penalties that would be imposed by section 4 of the 
bill would constitute receipts, pay-as-you-go procedures would 
apply. However, CBO estimates that those receipts would be 
insignificant.
    Intergovernmental and private-sector impact.--This bill 
would not impose any intergovernmental or private-sector 
mandates as defined in UMRA. The bill would provide funds to 
the state of Hawaii in the form of housing assistance grants, 
and any costs would be incurred as a condition of receiving 
those grants. The state would also be eligible to receive 
federal guarantees for low-income housing loans.
    Estimate prepared by.--Federal costs: Carla Pedone and 
Susanne Mehlman. Impact on State, local, and tribal 
governments: Leo Lex. Impact on the private sector: Lesley 
Frymier.
    Estimate approved by.--Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                        Executive Communications

    The position of the Administration on S. 109, as contained 
in a letter to the Committee on Indian Affairs from the U.S. 
Department of Justice, is set forth below:





                    Regulatory and Paperwork Impact

    Paragraph 11(b) of rule XXVI of the Standing Rules of the 
Senate requires each report accompanying a bill to evaluate the 
regulatory and paperwork impact that would be incurred in carry 
out the bill. The Committee finds that S. 109, as amended, will 
require the promulgation of regulations, but because the 
Secretary of the Department of Housing and Urban Development 
has already promulgated regulations through a negotiated 
rulemaking process for the Native American Housing Assistance 
and Self-Determination Act, the Regulatory and paperwork impact 
should be minimized.

                        Changes in Existing Law

    In compliance with subsection 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by a 
bill are required to be set forth in the accompanying Committee 
report. Changes in existing law are outlined below, with 
material to be deleted in brackets, and material to be added in 
italic signified by quotation marks:
    The Native American Housing Assistance and Self-
Determination Act of 1996 (25 U.S.C. 4101 et seq.) is amended 
by adding at the end the following:

         ``TITLE VIII--HOUSING ASSISTANCE FOR NATIVE HAWAIIANS

``SEC. 801. DEFINITIONS.

    ``In this title:
          ``(1) Department of hawaiian home lands; 
        department.--The term `Department of Hawaiian Home 
        Lands' or `Department' means the agency or department 
        of the government of the State of Hawaii that is 
        responsible for the administration of the Hawaiian 
        Homes Commission Act, 1920 (42 Stat. 108 et seq.).
          ``(2) Director.--The term `Director' means the 
        Director of the Department of Hawaiian Home Lands.
          ``(3) Elderly families; near-elderly families.--
                  ``(A) In general.--The term `elderly family' 
                or `near-elderly family' means a family whose 
                head (or his or her spouse), or whose member, 
                is--
                          ``(i) for an elderly family, an 
                        elderly person; or
                          ``(ii) for a near-elderly family, a 
                        near-elderly person.
                  ``(B) Certain families included.--The term 
                `elderly family' or `near-elderly family' 
                includes--
                          ``(i) 2 or more elderly persons or 
                        near-elderly persons, as the case may 
                        be, living together; and
                          ``(ii) 1 or more persons described in 
                        clause (i) living with 1 or more 
                        persons determined under the housing 
                        plan to be essential to their care or 
                        well-being.
          ``(4) Hawaiian home lands.--The term `Hawaiian Home 
        Lands' means lands that--
                  ``(A) have the status as Hawaiian home lands 
                under section 204 of the Hawaiian Homes 
                Commission Act (42 Stat. 110); or
                  ``(B) are acquired pursuant to that Act.
          ``(5) Housing area.--The term `housing area' means an 
        areas of Hawaiian Home Lands with respect to which the 
        Department of Hawaiian Home Lands is authorized to 
        provide assistance for affordable housing under this 
        Act.
          ``(6) Housing entity.--The term `housing entity' 
        means the Department of Hawaiian Home Lands.
          ``(7) Housing plan.--The term `housing plan' means a 
        plan developed by the Department of Hawaiian Home 
        Lands.
          ``(8) Median income.--The term `median income' means, 
        with respect to an area that is a Hawaiian housing 
        area, the greater of--
                  ``(A) the median income for the Hawaiian 
                housing area, which shall be determined by the 
                Secretary; or
                  ``(B) the median income for the State of 
                Hawaii.
          ``(9) Native hawaiian.--The term `Native Hawaiian' 
        has the meaning given the term `Native Hawaiian' in 
        section 201 of the Hawaiian Homes Commission Act, 1920 
        (42 Stat. 108 et seq.).

``SEC. 802. BLOCK GRANTS FOR AFFORDABLE HOUSING ACTIVITIES.

    ``(a) Grant Authority.--For each fiscal year, the Secretary 
shall (to the extent amounts are made available to carry out 
this title) make a grant under this title to the Department of 
Hawaiian Home Lands to carry out affordable housing activities 
for Native Hawaiian families on or near Hawaiian Home Lands.
    ``(b) Plan Requirement.--
          ``(1) In general.--The Secretary may make a grant 
        under this title to the Department of Hawaiian Home 
        Lands for a fiscal year only if--
                  ``(A) the Director has submitted to the 
                Secretary a housing plan for that fiscal year; 
                and
                  ``(B) the Secretary has determined under 
                section 804 that the housing plan complies with 
                the requirements of section 803.
          ``(2) Waiver.--The Secretary may waive the 
        applicability of the requirements under paragraph (1), 
        in part, if the Secretary finds that the Department of 
        Hawaiian Home Lands has not complied or cannot comply 
        with those requirements due to circumstances beyond the 
        control of the Department of Hawaiian Home Lands.
    ``(c) Use of Affordable Housing Activities Under Plan.--
Except as provided in subsection (e), amounts provided under a 
grant under this section may be used only for affordable 
housing activities under this title that are consistent with a 
housing plan approved under section 804.
    ``(d) Administrative Expenses.--
          ``(1) In general.--The Secretary shall, by 
        regulation, authorize the Department of Hawaiian Home 
        Lands to use a percentage of any grant amounts receive 
        under this title for an reasonable administrative and 
        planning expenses of the Department relating to 
        carrying out this title and activities assisted with 
        those amounts.
          ``(2) Administrative and planning expenses.--The 
        administrative and planning expenses referred to in 
        paragraph (1) include--
                  ``(A) cost for salaries of individuals 
                engaged in administering and managing 
                affordable housing activities assisted with 
                grant amounts provided under this title; and
                ``(B) expenses incurred in preparing a housing 
                plan under section 803.
    ``(e) Public-Private Partnerships.--The Director shall make 
all reasonable efforts, consistent with the purposes of this 
title, to maximize participation by the private sector, 
including nonprofit organizations and for-profit entitles, in 
implementing a housing plan that has been approved by the 
Secretary under section 803.
    ``(f) Applicability of Others Provisions.--
          ``(1) In general.--The Secretary shall be guided by 
        the relevant program requirements of titles, I, II, and 
        IV in the implementation of housing assistance programs 
        for Native Hawaiians under this title.
          ``(2) Exception.--The Secretary may make exceptions 
        to, or modifications of, program requirements for 
        Native American housing assistance set forth in titles 
        I, II, and IV as necessary and appropriate to meet the 
        unique situation and housing needs of Native Hawaiians.

``SEC. 803. HOUSING PLAN.

    ``(a) Plan Submission.--The Secretary shall--
          ``(1) require the Director to submit a housing plan 
        under this section for each fiscal year; and
          ``(2) provide for the review of each plan submitted 
        under paragraph (1).
    ``(b) 5-Year Plan.--Each housing plan under this section 
shall--
          ``(1) be in a form prescribed by the Secretary; and
          ``(2) contain, with respect to the 5-year period 
        beginning with the fiscal year for which the plan is 
        submitted, the following information:
                  ``(A) Mission statement.--A general statement 
                of the mission of the Department of Hawaiian 
                Home Lands to serve the needs of the low-income 
families to be served by the Department.
                  ``(B) Goal and objectives.--A statement of 
                the goals and objectives of the Department of 
                Hawaiian Home Lands to enable the Department to 
                serve the needs identified in subparagraph (A) 
                during the period.
                  ``(C) Activities plans.--An overview of the 
                activities planned during the period including 
                an analysis of the manner in which the 
                activities will enable the Department to meet 
                its mission, goals, and objectives.
    ``(c) 1-Year Plan.--A housing plan under this section 
shall--
          ``(1) be in a form prescribed by the Secretary; and
          ``(2) contain the following information relating to 
        the fiscal year for which the assistance under this 
        title is to be made available:
                  ``(A) Goals and objectives.--A statement of 
                the goals and objectives to be accomplished 
                during the period covered by the plan.
                  ``(B) Statement of needs.--A statement of the 
                housing needs of the low-income families served 
                by the Department and the means by which those 
                needs will be addressed during the period 
                covered by the plan, including--
                            ``(i) a description of the 
                        estimated housing needs and the need 
                        for assistance for the low-income 
                        families to be served by the 
                        Department, including a description of 
                        the manner in which the geographical 
                        distribution of assistance is 
                        consistent with--
                                  ``(I) the geographical needs 
                                of those families; and
                                  ``(II) needs for various 
                                categories of housing 
                                assistance; and
                          ``(ii) a description of the estimated 
                        housing needs for all families to be 
                        served by the Department.
                  ``(C) Financial resources.--An operating 
                budget for the Department of Hawaiian Home 
                Lands, in a form prescribed by the Secretary, 
                that includes--
                        ``(i) an identification and a 
                        description of the financial resources 
                        reasonably available to the Department 
                        to carry out the purposes of this 
                        title, including an explanation of the 
                        manner in which amounts made available 
                        will be used to leverage additional 
                        resources; and
                        ``(ii) the uses to which, the resources 
                        described in clause (i) will be 
                        committed, including--
                                  ``(I) eligible and required 
                                affordable housing activities; 
                                and
                                  ``(II) administrative 
                                expenses.
                  ``(D) Affordable housing resources.--A 
                statement of the affordable housing resources 
                currently available at the time of the 
                submittal of the plan and to be made available 
                during the period covered by the plan, 
                including--
                          ``(i) a description of the 
                        significant characteristics of the 
                        housing market in the State of Hawaii, 
                        including the availability of housing 
                        from other public sources, private 
                        market housing; and
                          ``(ii) the manner in which the 
                        characteristics referred to in clause 
                        (i) influence the decision of the 
                        Department of Hawaiian Home Lands to 
                        use grant amounts to be provided under 
                        this title for--
                                  ``(I) rental assistance;
                                  ``(II) the production of new 
                                units;
                                  ``(III) the acquisition of 
                                existing units; or
                                  ``(IV) the rehabilitation of 
                                units;
                          ``(iii) a description of the 
                        structure, coordination, and means of 
                        cooperation between the Department of 
                        Hawaiian Home Lands and any other 
                        governmental entities in the 
                        development, submission, or 
                        implementation of housing plans, 
                        including a description of--
                                  ``(I) the involvement of 
                                private, public, and nonprofit 
                                organizations and institutions;
                                  ``(II) the use of loan 
                                guarantees under section 184A 
                                of the Housing and Community 
                                Development Act of 1992; and
                                  ``(III) other housing 
                                assistance provided by the 
                                United States, including loans, 
                                grants, and mortgage insurance;
                          ``(iv) a description of the manner in 
                        which the plan will address the needs 
                        identified pursuant to subparagraph 
                        (C);
                          ``(v) a description of--
                                  ``(I) any existing or 
                                anticipated homeownership 
                                programs and rental programs to 
                                be carried out during the 
                                period covered by the plan; and
                                  ``(II) the requirements and 
                                assistance available under the 
                                programs referred to in 
                                subclause (I);
                          ``(vi) a description of--
                                  ``(I) any existing or 
                                anticipated housing 
                                rehabilitation programs 
                                necessary to ensure the long-
                                term viability of the housing 
                                to be carried out during the 
                                period covered by the plan; and
                                  ``(II) the requirements and 
                                assistance available under the 
                                programs referred to in 
                                subclause (I);
                          ``(vii) a description of--
                                  ``(I) all other existing or 
                                anticipated housing assistance 
                                provided by the Department of 
                                Hawaiian Home Lands during the 
                                period covered by the plan, 
                                including--
                                          ``(aa) transitional 
                                        housing;
                                          ``(bb) homeless 
                                        housing;
                                          ``(cc) college 
                                        housing; and
                                          ``(dd) supportive 
                                        services housing; and
                                  ``(II) the requirements and 
                                assistance available under such 
                                programs;
                          ``(viii)(I) a description of any 
                        housing to be demolished or disposed 
                        of;
                          ``(II) a timetable for that 
                        demolition or disposition; and
                          ``(III) any other information 
                        required by the Secretary with respect 
                        to that demolition or disposition;
                          ``(ix) a description of the manner in 
                        which the Department of Hawaiian Home 
                        Lands will coordinate with welfare 
                        agencies in the State of Hawaii to 
                        ensure that residents of the affordable 
                        housing will be provided with access to 
                        resources to assist in obtaining 
                        employment and achieving self-
                        sufficiency;
                          ``(x) a description of the 
                        requirements established by the 
                        Department of Hawaiian Home Lands to--
                                  ``(I) promote the safety of 
                                residents of the affordable 
                                housing;
                                  ``(II) facilitate the 
                                undertaking of crime prevention 
                                measures;
                                  ``(III) allow resident input 
                                and involvement, including the 
                                establishment of resident 
                                organizations; and
                                  ``(IV) allow for the 
                                coordination of crime 
                                prevention activities between 
                                the Department and local law 
                                enforcement officials; and
                          ``(xi) a description of the entities 
                        that will carry out the activities 
                        under the plan, including the 
                        organizational capacity and key 
                        personnel of the entities.
                  ``(E) Certification of compliance.--Evidence 
                of compliance that shall include, as 
                appropriate--
                          ``(i) a certification that the 
                        Department of Hawaiian Home Lands will 
                        comply with--
                                  ``(I) title VI of the Civil 
                                Rights Act of 1964 (42 U.S.C. 
                                2000d et seq). or with title 
                                VIII of the Civil Rights Act of 
                                1968 (42 U.S.C. 3601 et seq.) 
                                in carrying out this title, to 
                                the extent that such title is 
                                applicable; and
                                ``(II) other applicable Federal 
                                statutes;
                          ``(ii) a certification that the 
                        Department will require adequate 
                        insurance coverage for housing units 
                        that are owned and operated or assisted 
                        with grant amounts provided under this 
                        title, in compliance with such 
                        requirements as may be established by 
                        the Secretary;
                          ``(iii) a certification that policies 
                        are in effect and are available for 
                        review by the Secretary and the public 
                        governing the eligibility, admission, 
                        and occupancy of families for housing 
                        assisted with grant amounts provided 
                        under this title;
                          ``(iv) a certification that policies 
                        are in effect and are available for 
                        review by the Secretary and the public 
                        governing rents charged, including the 
                        methods by which such rents or 
                        homebuyer payments are determined, for 
                        housing assisted with grant amounts 
                        provided under this title; and
                          ``(v) a certification that policies 
                        are in effect and are available for 
                        review by the Secretary and the public 
                        governing the management and 
                        maintenance of housing assisted with 
                        grant amounts provided under this 
                        title.
    ``(d) Applicability of Civil Rights Statutes.--
          ``(1) In general.--To the extent that the 
        requirements of title VI of the Civil Rights Act of 
        1964 (42 U.S.C. 2000d et seq.) or of title VIII of the 
        Civil Rights Act of 1968 (42 U.S.C. 3601 et seq.) apply 
        to assistance provided under this title, nothing in the 
        requirements concerning discrimination on the basis of 
        race shall be construed to prevent the provision of 
        assistance under this title--
                  ``(A) to the Department of Hawaiian Home 
                Lands on the basis that the Department served 
                Native Hawaiians; or
                  ``(B) to an eligible family on the basis that 
                the family is a Native Hawaiian family.
          ``(2) Civil rights.--Program eligibility under this 
        title may be restricted to Native Hawaiians. Subject to 
        the preceding sentence, no person may be discriminated 
        against on the basis of race, color, national origin, 
        religion, sex, familial status, or disability.
    ``(e) Use of Nonprofit Organizations.--As a condition of 
receiving grant amounts under this title, the Department of 
Hawaiian Home Lands shall, to the extent practicable, provide 
for private nonprofit organizations experienced in the planning 
and development of affordable housing for Native Hawaiians to 
carry out affordable housing activities with those grant 
amounts.

``SEC. 804. REVIEW OF PLANS.

    ``(a) Review and Notice.--
          ``(1) Review.--
                  ``(A) In general.--The Secretary shall 
                conduct a review of a housing plan submitted to 
                the Secretary under section 803 to ensure that 
                the plan complies with the requirements of that 
                section.
                  ``(B) Limitation.--The Secretary shall have 
                the discretion to review a plan referred to in 
                subparagraph (A) only to the extent that the 
                Secretary considers that the review is 
                necessary.
          ``(2) Notice.--
                  ``(A) In general.--Not later than 60 days 
                after receiving a plan under section 803, the 
                Secretary shall notify the Director of the 
                Department of Hawaiian Home Lands whether the 
                plan complies with the requirements under that 
                section.
                  ``(B) Effect of failure of secretary to take 
                action.--For purposes of this title, if the 
                Secretary does not notify the Director, as 
                required under this subsection and subsection 
                (b), upon the expiration of the 60-day period 
                described in subparagraph (A)--
                          ``(i) the plan shall be considered to 
                        have been determined to comply with the 
                        requirements under section 803; and
                          ``(ii) the Director shall be 
                        considered to have been notified of 
                        compliance.
    ``(b) Notice of Reasons for Determination of 
Noncompliance.--If the Secretary determines that a plan 
submitted under section 803 does not comply with the 
requirements of that section, the Secretary shall specify in 
the notice under subsection (a)--
          ``(1) the reasons for noncompliance; and
          ``(2) any modifications necessary for the plan to 
        meet the requirements of section 803.
    ``(c) Review.--
          ``(1) In general.--After the Director of the 
        Department of Hawaiian Home Lands submits a housing 
        plan under section 803, or any amendment or 
        modification to the plan to the Secretary, to the 
        extent that the Secretary considers such action to be 
        necessary to make a determination under this 
        subsection, the Secretary shall review the plan 
        (including any amendments or modifications thereto) to 
        determine whether the contents of the plan--
                  ``(A) set forth the information required by 
                section 803 to be contained in the housing 
                plan;
                  ``(B) are consistent with information and 
                data available to the Secretary; and
                  ``(C) are not prohibited by or inconsistent 
                with any provision of this Act or any other 
                applicable law.
          ``(2) Incomplete plans.--If the Secretary determines 
        under this subsection that any of the appropriate 
        certifications required under section 803(c)(2)(E) are 
        not included in a plan, the plan shall be considered to 
        be incomplete.
    ``(d) Updates to Plan.--
          ``(1) In general.--Subject to paragraph (2), after a 
        plan under section 803 has been submitted for a fiscal 
        year, the Director of the Department of Hawaiian Home 
        Lands may comply with the provisions of that section 
        for any succeeding fiscal year (with respect to 
        information included for the 5-year period under 
        section 803(b) or for the 1-year period under section 
        803(c)) by submitting only such information regarding 
        such changes as may be necessary to update the plan 
        previously submitted.
          ``(2) Complete plans.--The Director shall submit a 
        complete plan under section 803 not later than 4 years 
        after submitting an initial plan under that section, 
        and not less frequently than every 4 years thereafter.
    ``(e) Effective Date.--This section and section 803 shall 
take effect on the date provided by the Secretary pursuant to 
section 807(a) to provide for timely submission and review of 
the housing plan as necessary for the provision of assistance 
under this title for fiscal year 2000.

``SEC. 805. TREATMENT OF PROGRAM INCOME AND LABOR STANDARDS.

    ``(a) Program Income.--
          ``(1) Authority to retain.--The Department of 
        Hawaiian Home Lands may retain any program income that 
        is realized from any grant amounts received by the 
        Department under this title if--
                  ``(A) that income was realized after the 
                initial disbursement of the grant amounts 
                received by the Department; and
                  ``(B) the Director agrees to use the program 
                income for affordable housing activities in 
                accordance with the provisions of this title.
          ``(2) Prohibition of reduction of grant.--The 
        Secretary may not reduce the grant amount for the 
        Department of Hawaiian Home Lands based solely on--
                  ``(A) whether the Department retains program 
                income under paragraph (1); or
                  ``(B) the amount of any such program income 
                retained.
          ``(3) Exclusion of amounts.--The Secretary may, by 
        regulation, exclude from consideration as program 
        income any amounts determined to be so small that 
        compliance with the requirements of this subsection 
        would create an unreasonable administrative burden on 
        the Department.
    ``(b) Labor Standards.--
          ``(1) In general.--Any contract or agreement for 
        assistance, sale, or lease pursuant to this title shall 
        contain--
                  ``(A) a provision requiring that an amount 
                not less than the wages prevailing in the 
                locality, as determined or adopted (subsequent 
                to a determination under applicable State or 
                local law) by the Secretary, shall be paid to 
                all architects, technical engineers, draftsmen, 
                technicians employed in the development and all 
                maintenance, and laborers and mechanics 
                employed in the operation, of the affordable 
                housing project involved; and
                  ``(B) a provision that an amount not less 
                than the wages prevailing in the locality, as 
                predetermined by the Secretary of Labor 
                pursuant to the Act commonly known as the 
                `Davis-Bacon Act' (46 Stat. 1494, chapter 411; 
                40 U.S.C. 276a et seq.) shall be paid to all 
                laborers and mechanics employed in the 
                development of the affordable housing involved.
          ``(2) Exceptions.--Paragraph (1) and provisions 
        relating to wages required under paragraph (1) in any 
        contract or agreement for assistance, sale, or lease 
        under this title, shall not apply to any individual who 
        performs the services for which the individual 
        volunteered and who is not otherwise employed at any 
        time in the construction work and received no 
        compensation or is paid expenses, reasonable benefits, 
        or a nominal fee for those services.

``SEC. 806. ENVIRONMENTAL REVIEW.

    ``(a) In General.--
          ``(1) Release of funds.--
                  ``(A) In general.--The Secretary may carry 
                out the alternative environmental protection 
                procedures described in subparagraph (B) in 
                order to ensure--
                          ``(i) that the policies of the 
                        National Environmental Policy Act of 
                        1969 (42 U.S.C. 4321 et seq.) and other 
                        provisions of law that further the 
                        purposes of such Act (as specified in 
                        regulations issued by the Secretary) 
                        are most effectively implemented in 
                        connectionwith the expenditure of grant 
amounts provided under this title; and
                          ``(ii) to the public undiminished 
                        protection of the environment.
                  ``(B) Alternative environmental protection 
                procedure.--In lieu of applying environmental 
                protection procedures otherwise applicable, the 
                Secretary may by regulation provide for the 
                release of funds for specific projects to the 
                Department of Hawaiian Home Lands if the 
                Director of the Department assumes all of the 
                responsibilities for environmental review, 
                decisionmaking, and action under the National 
                Environmental Policy Act of 1969 (42 U.S.C. 
                4321 et seq.), and such other provisions of law 
                as the regulations of the Secretary specify, 
                that would apply to the Secretary were the 
                Secretary to undertake those projects as 
                Federal projects.
          ``(2) Regulations.--
                  ``(A) In general.--The Secretary shall issue 
                regulations to carry out this section only 
                after consultation with the Council on 
                Environmental Quality.
                  ``(B) Contents.--The regulations issued under 
                this paragraph shall--
                          ``(i) provide for the monitoring of 
                        the environmental reviews performed 
                        under this section;
                          ``(ii) in the discretion of the 
                        Secretary, facilitate training for the 
                        performance of such reviews; and
                          ``(iii) provide for the suspension or 
                        termination of the assumption of 
                        responsibilities under this section.
          ``(3) Effect on assumed responsibility.--The duty of 
        the Secretary under paragraph (2)(B) shall not be 
        construed to limit or reduce any responsibility assumed 
        by the Department of Hawaiian Home Lands for grant 
        amounts with respect to any specific release of funds.
    ``(b) Procedure.--
          ``(1) In general.--The Secretary shall authorize the 
        release of funds subject to the procedures under this 
        section only if, not less than 15 days before that 
        approval and before any commitment of funds to such 
        projects, the Director of the Department of Hawaiian 
        Home Lands submits to the Secretary a request for such 
        release accompanied by a certification that meets the 
        requirements of subsection (c).
          ``(2) Effect of approval.--The approval of the 
        Secretary of a certification described in paragraph (1) 
        shall be deemed to satisfy the responsibilities of the 
        Secretary under the National Environmental Policy Act 
        of 1969 (42 U.S.C. 4321 et seq.) and such other 
        provisions of law as the regulations of the Secretary 
        specify to the extent that those responsibilities 
        relate to the release of funds for projects that are 
        covered by that certification.
    ``(c) Certification.--A certification under the procedures 
under this section shall--
          ``(1) be in a form acceptable to the Secretary;
          ``(2) be executed by the Director of the Department 
        of Hawaiian Home Lands;
          ``(3) specify that the Department of Hawaiian Home 
        Lands has fully carried out its responsibilities as 
        described under subsection (a); and
          ``(4) specify that the Director--
                  ``(A) consents to assume the status of a 
                responsible Federal official under the National 
                Environmental Policy Act of 1969 (42 U.S.C. 
                4321 et seq.) and each provision of law 
                specified in regulations issued by the 
                Secretary to the extent that those laws apply 
                by reason of subsection (a); and
                  ``(B) is authorized and consents on behalf of 
                the Department of Hawaiian Home Lands and the 
                Director accepts the jurisdiction of the 
                Federal courts for the purpose of enforcement 
                of the responsibilities of the Director of the 
                Department of Hawaiian Home Lands as such an 
                official.

``SEC. 807. REGULATIONS.

    ``The Secretary shall issue final regulations necessary to 
carry out this title not later than June 1, 1999.

``SEC. 808. EFFECTIVE DATE.

    ``Except as otherwise expressly provided in this title, 
this title shall take effect on June 1, 1999.

``SEC. 809. AFFORDABLE HOUSING ACTIVITIES.

    ``(a) National Objectives and Eligible Families--
          ``(1) Primary objective.--The national objectives of 
        this title are--
                  ``(A) to assist and promote affordable 
                housing activities to develop, maintain, and 
                operate affordable housing in safe and healthy 
                environments for occupancy by low-income Native 
                Hawaiian families;
                  ``(B) to ensure better access to private 
                mortgage markets and to promote self-
                sufficiency of low-income Native Hawaiian 
                families;
                  ``(C) to coordinate activities to provide 
                housing for low-income Native Hawaiian families 
                with Federal, State and local activities to 
                further economic and community development;
                  ``(D) to plan for and integrate 
                infrastructure resources on the Hawaiian Home 
                Lands with housing development; and
                  ``(E) to--
                          ``(i) promote the development of 
                        private capital markets; and
                          ``(ii) allow the markets referred to 
                        in clause (i) to operate and grow, 
                        thereby benefiting Native Hawaiian 
                        communities.
          ``(2) Eligible families.--
                  ``(A) In general.--Except as provided under 
                subparagraph (B), assistance for eligible 
                housing activities under this title shall be 
                limited to low-income Native Hawaiian families.
                  ``(B) Exception to low-income requirement.--
                          ``(i) In general.--The Director may 
                        provide assistance for homeownership 
                        activities under--
                                  ``(I) section 810(b);
                                  ``(II) model activities under 
                                section 810(f); or
                                  ``(III) loan guarantee 
                                activities under section 184A 
                                of the Housing and Community 
                                Development Act of 1992 to 
                                Native Hawaiian families who 
                                are not low-income families, to 
                                the extent that the Secretary 
                                approves the activities under 
                                that section to address a need 
                                for housing for those families 
                                that cannot be reasonably met 
                                without that assistance.
                          ``(ii) Limitations. The Secretary 
                        shall establish limitations on the 
                        amount of assistance that may be 
                        provided under this title for 
                        activities for families that are not 
                        low-income families.
                  ``(C) Other families.--Notwithstanding 
                paragraph (1), the Director may provide housing 
                or housing assistance provided through 
                affordable housing activities assisted with 
                grant amounts under this title to a family that 
                is not composed of Native Hawaiians if--
                          ``(i) the Department determines that 
                        the presence of the family in the 
                        housing involved is essential to the 
                        well-being of Native Hawaiian families; 
                        and
                          ``(ii) the need for housing for the 
                        family cannot be reasonably met without 
                        the assistance.
                  ``(D) Preference.--
                          ``(i) In general.--A housing plan 
                        submitted under section 803 may 
                        authorize a preference, for housing or 
                        housing assistance provided through 
                        affordable housing activities assisted 
                        with grant amounts provided under this 
                        title to be provided, to the extent 
                        practicable, to families that are 
                        eligible to reside on the Hawaiian Home 
                        Lands.
                          ``(ii) Application.--In any case in 
                        which a housing plan provides for 
                        preference described in clause (i), the 
                        Director shall ensure that housing 
                        activities that are assisted with grant 
                        amounts under this title are subject to 
                        that preference.
                  ``(E) Use of nonprofit organizations.--As a 
                condition of receiving grant amounts under this 
                title, the Department of Hawaiian Home Lands, 
                shall to the extent practicable, provide for 
                private nonprofit organizations experienced in 
                the planning and development of affordable 
                housing for Native Hawaiians to carry out 
                affordable housing activities with those grant 
                amounts.

``SEC. 180. ELIGIBLE AFFORDABLE HOUSING ACTIVITIES.

    ``(a) In General.--Affordable housing activities under this 
section are activities conducted in accordance with the 
requirements of section 811 to--
          ``(1) develop or to support affordable housing for 
        rental or homeownership; or
          ``(2) provide housing services with respect to 
        affordable housing, through the activities described in 
        subsection (b).
    ``(b) Activities.--The activities described in this 
subsection are the following:
          ``(1) Development.--The acquisition, new 
        construction, reconstruction, or moderate or 
        substantial rehabilitation of affordable housing, which 
        may include--
                  ``(A) real property acquisition;
                  ``(B) site improvement;
                  ``(C) the development of utilities and 
                utility services;
                  ``(D) conversion;
                  ``(E) demolition;
                  ``(F) financing;
                  ``(G) administration and planning; and
                  ``(H) other related activities.
          ``(2) Housing services.--The provision of housing-
        related services for affordable housing, including--
                  ``(A) housing counseling in connection with 
                rental or homeownership assistance;
                  ``(B) the establishment and support of 
                resident organizations and resident management 
                corporations;
                  ``(C) energy auditing;
                  ``(D) activities related to the provision of 
                self-sufficiency and other services; and
                  ``(E) other services related to assisting 
                owners, tenants, contractors, and other 
                entities participating or seeking to 
                participate in other housing activities 
                assisted pursuant to this section.
          ``(3) Housing management services.--The provision of 
        management services for affordable housing, including--
                  ``(A) the preparation of work specifications;
                  ``(B) loan processing;
                  ``(C) inspections;
                  ``(D) tenant selection;
                  ``(E) management of tenant-based rental 
                assistance; and
                  ``(F) management of affordable housing 
                projects.
          ``(4) Crime prevention and safety activities.--The 
        provision of safety, security, and law enforcement 
        measures and activities appropriate to protect 
        residents of affordable housing from crime.
          ``(5) Model activities.--Housing activities under 
        model programs that are--
                  ``(A) designed to carry out the purposes of 
                this title; and
                  ``(B) specifically approved by the Secretary 
                as appropriate for the purpose referred to in 
                subparagraph (A).

``SEC. 811. PROGRAM REQUIREMENTS.

    ``(a) Rents.--
          ``(1) Establishment.--Subject to paragraph (2), as a 
        condition to receiving grant amounts under this title, 
        the Director shall develop written policies governing 
        rents and homebuyer payments charged for dwelling units 
        assisted under this title, including methods by which 
        such rents and homebuyer payments are determined.
          ``(2) Maximum rent.--In the case of any low-income 
        family residing in a dwelling unit assisted with grant 
        amounts under this title, the monthly rent or homebuyer 
        payment (as applicable) for that dwelling unit may not 
        exceed 30 percent of the monthly adjusted income of 
        that family.
    ``(b) Maintenance and Efficient Operation.--
          ``(1) In general.--The Director shall, using amounts 
        of any grants received under this title, reserve and 
        use for operating under section 810 such amounts as may 
        be necessary to provide for the continued maintenance 
        and efficient operation of such housing.
          ``(2) Disposal of certain housing.--This subsection 
        may not be construed to prevent the Director, or any 
        entity funded by the Department, from demolishing or 
        disposing of housing, pursuant to regulations 
        established by the Secretary.
    ``(c) Insurance Coverage.--As a condition to receiving 
grant amounts under this title, the Director shall require 
adequate insurance coverage for housing units that are owned or 
operated or assisted with grant amounts provided under this 
title.
    ``(d) Eligibility for Admission.--As a condition to 
receiving grant amounts under this title, the Director shall 
develop written policies governing the eligibility, admission, 
and occupancy of families for housing assisted with grant 
amounts provided under this title.
    ``(e) Management and Maintenance.--As a condition to 
receiving grant amounts under this title, the Director shall 
develop policies governing the management and maintenance of 
housing assisted with grant amounts under this title.

``SEC. 812. TYPES OF INVESTMENTS.

    ``(a) In General.--Subject to section 811 and an applicable 
housing plan approved under section 803, the Director shall 
have--
          ``(1) the discretion to use grant amounts for 
        affordable housing activities through the use of--
                  ``(A) equity investments;
                  ``(B) interest-bearing loans or advances;
                  ``(C) noninterest-bearing loans or advances;
                  ``(D) interest subsidies;
                  ``(E) the leveraging of private investments; 
                or
                  ``(F) any other form of assistance that the 
                Secretary determines to be consistent with the 
                purposes of this title; and
          ``(2) the right to establish the terms of assistance 
        provided with funds referred to in paragraph (1).
    ``(b) Investments.--The Director of the Department of 
Hawaiian Home Lands may invest grant amounts for the purposes 
of carrying out affordable housing activities in investment 
securities and other obligations, as approved by the Secretary.

``SEC. 813. LOW-INCOME REQUIREMENT AND INCOME TARGETING.

    ``(a) In General.--Housing shall qualify for affordable 
housing for purposes of this title only if--
          ``(1) each dwelling unit in the housing--
                  ``(A) in the case of rental housing, is made 
                available for occupancy only by a family that 
                is a low-income family at the time of the 
                initial occupancy of that family of that unit; 
                and
                  ``(B) in the case of housing for 
                homeownership, is made available for purchase 
                only by a family that is a low-income family at 
                the time of purchase; and
          ``(2) each dwelling unit in the housing will remain 
        affordable, according to binding commitments 
        satisfactory to the Secretary, for--
                  ``(A) the remaining useful life of the 
                property (as determined by the Secretary) 
                without regard to the term of the mortgage or 
                to transfer of ownership; or
                  ``(B) such other period as the Secretary 
                determines is the longest feasible period of 
                time consistent with sound economics and the 
                purposes of this title, except upon a 
                foreclosure by a lender (or upon other transfer 
                in lieu of foreclosure) if that action--
                          ``(i) recognizes any contractual or 
                        legal rights of any public agency, 
                        nonprofit sponsor, or other person or 
                        entity to take an action that would--
                                  ``(I) avoid termination of 
                                low-income affordability, in 
                                the case of foreclosure; or
                                  ``(II) transfer ownership in 
                                lieu of foreclosure; and
                          ``(ii) is not for the purpose of 
                        avoiding low-income affordability 
                        restrictions, as determined by the 
                        Secretary.
    ``(b) Exception.--Notwithstanding subsection (a), housing 
assisted pursuant to section 809(a)(2)(B) shall be considered 
affordable housing for purposes of this title.

``SEC. 814. LEASE REQUIREMENTS AND TENANT SELECTION.

    ``(a) Leases.--Except to the extent otherwise provided by 
or inconsistent with the laws of the State of Hawaii, in 
renting dwelling units in affordable housing assisted with 
grant amounts provided under this title, the Director, owner, 
or manager shall use leases that--
          ``(1) do not contain unreasonable terms and 
        conditions;
          ``(2) require the Director, owner, or manager to 
        maintain the housing in compliance with applicable 
        housing codes and quality standards;
          ``(3) require the Director, owner, or manager to give 
        adequate written notice of termination of the lease, 
        which shall be the period of time required under 
        applicable State or local law;
          ``(4) specify that, with respect to any notice of 
        eviction or termination, notwithstanding any State or 
        local law, a resident shall be informed of the 
        opportunity, before any hearing or trial, to examine 
        any relevant documents, record, or regulations directly 
        related to the eviction or termination;
          ``(5) require that the Director, owner, or manager 
        may not terminate the tenancy, during the term of the 
        lease, except for serious or repeated violation of the 
        terms and conditions of the lease, violation of 
        applicable Federal, State, or local law, or for other 
        good cause; and
          ``(6) provide that the Director, owner, and manager 
        may terminate the tenancy of a resident for any 
        activity, engaged in by the resident, any member of the 
        household of the resident, or any guest or other person 
        under the control of the resident, that--
                  ``(A) threatens the health or safety of, or 
                right to peaceful enjoyment of the premises by, 
                other residents or employees of the Department, 
                owner, or manager;
                  ``(B) threatens the health or safety of, or 
                right to peaceful enjoyment of their premises 
                by, persons residing in the immediate vicinity 
                of the premises; or
                  ``(C) is criminal activity (including drug-
                related criminal activity) on or off the 
                premises.
    ``(b) Tenant or Homebuyer Selection.--As a condition to 
receiving grant amounts under this title, the Director shall 
adopt and use written tenant and homebuyer selection policies 
and criteria that--
          ``(1) are consistent with the purpose of providing 
        housing for low-income families;
          ``(2) are reasonably related to program eligibility 
        and the ability of the applicant to perform the 
        obligations of the lease; and
          ``(3) provide for--
                  ``(A) the selection of tenants and homebuyers 
                from a written waiting list in accordance with 
                the policies and goals set forth in an 
                applicable housing plan approved under section 
                803; and
                  ``(B) the prompt notification in writing to 
                any rejected applicant of the grounds for that 
                rejection.

``SEC. 815. REPAYMENT.

    ``If the Department of Hawaiian Home Lands uses grant 
amounts to provide affordable housing under activities under 
this title and, at any time during the useful life of the 
housing, the housing does not comply with the requirement under 
section 813(a)(2), the Secretary shall--
          ``(1) reduce future grant payments on behalf of the 
        Department by an amount equal to the grant amounts used 
        for that housing (under authority of section 
        818(a)(1)(B)); or
          ``(2) require repayment to the Secretary of any 
        amount equal to those grant amounts.

``SEC. 816. ANNUAL ALLOCATION.

    ``For each fiscal year, the Secretary shall allocate any 
amounts made available for assistance under this title for the 
fiscal year, in accordance with the formula established 
pursuant to section 817 to the Department of Hawaiian Home 
Lands if the Department complies with the requirements under 
this title for a grant under this title.

``SEC. 817. ALLOCATION FORMULA.

    ``(a) Establishment.--The Secretary shall, by regulation 
issued not later than the expiration of the 6-month period 
beginning on the date of enactment of the native American 
Housing Assistance and Self-Determination Amendments of 1998, 
in the manner provided under section 807, establish a formula 
to provide for the allocation of amounts available for a fiscal 
year for block grants under this title in accordance with the 
requirements of this section.
    ``(b) Factors for Determination of Need.--The formula under 
subsection (a) shall be based on factors that reflect the needs 
for assistance for affordable housing activities, including--
          ``(1) the number of low-income dwelling units owned 
        or operated at the time pursuant to a contract between 
        the Director and the Secretary;
          ``(2) the extent of poverty and economic distress and 
        the number of Native Hawaiian families eligible to 
        reside on the Hawaiian Home Lands; and
          ``(3) any other objectively measurable conditions 
        that the Secretary and the Director may specify.
    ``(c) Other Factors for Consideration.--In establishing the 
formula under subsection (a), the Secretary shall consider the 
relative administrative capacities of the Department of 
Hawaiian Home Lands and other challenges faced by the 
Department, including--
          ``(1) geographic distribution within Hawaiian Home 
        Lands; and
          ``(2) technical capacity.
    ``(d) Effective Date.--This section shall take effect on 
the date of enactment of the Native American Housing Assistance 
and Self-Determination Amendments of 1998.

``SEC. 818. REMEDIES FOR NONCOMPLIANCE.

    ``(a) Actions by Secretary Affecting Grant Amounts.--
          ``(1) In general.--Except as provided in subsection 
        (b), if the Secretary finds after reasonable notice and 
        opportunity for a hearing that the Department of 
        Hawaiian Home Lands has failed to comply substantially 
        with any provision of this title, the Secretary shall--
                  ``(A) terminate payments under this title to 
                the Department;
                  ``(B) reduce payments under this title to the 
                Department by an amount equal to the amount of 
                such payments that were not expended in 
                accordance with this title; or
                  ``(C) limit the availability of payments 
                under this title to programs, projects, or 
                activities not affected by such failure to 
                comply.
          ``(2) Actions.--If the Secretary takes an action 
        under subparagraph (A), (B), or (C) of paragraph (1), 
        the Secretary shall continue that action until the 
        Secretary determines that the failure by the Department 
        to comply with the provision has been remedied by the 
        Department and the Department is in compliance with 
        that provision.
    ``(b) Noncompliance Because of a Technical Incapacity.--The 
Secretary may provide technical assistance for the Department, 
either directly or indirectly, that is designed to increase the 
capability and capacity of the Director of the Department to 
administer assistance provided under this title in compliance 
with requirements under this title if the Secretary makes a 
finding under subsection (a), but determines that the failure 
of the Department to comply substantially with the provisions 
of this title--
          ``(1) is not a pattern or practice of activities 
        constituting willful noncompliance; and
          ``(2) is a result of the limited capability or 
        capacity of the Department of Hawaiian Home Lands.
    ``(c) Referral for Civil Action.--
          ``(1) Authority.--In lieu of, or in addition to, any 
        action that the Secretary may take under subsection 
        (a), if the Secretary has reason to believe that the 
        Department of Hawaiian Home Lands has failed to comply 
        substantially with any provision of this title, the 
        Secretary may refer the matter to the Attorney General 
        of the United States with a recommendation that any 
        appropriate civil action to instituted.
          ``(2) Civil Action.--Upon receiving a referral under 
        paragraph (1), the Attorney General may bring a civil 
        action in any United States district court of 
        appropriate jurisdiction for such relief as may be 
        appropriate, including an action--
                  ``(A) to recover the amount of the assistance 
                furnished under this title that was not 
                expended in accordance with this title; or
                  ``(B) for mandatory or injunctive relief.
    ``(d) Review.--
          ``(1) In general.--If the Director receives notice 
        under subsection (a) of the termination, reduction, or 
        limitation of payments under this Act, the Director--
                  ``(A) may, not later than 60 days after 
                receiving such notice, file with the United 
                States Court of Appeals for the Ninth Circuit, 
                or in the United States Court of Appeals for 
                the District of Columbia, a petition for review 
                of the action of the Secretary; and
                  ``(B) upon the filing of any petition under 
                subparagraph (A), shall forthwith transmit 
                copies of the petition to the Secretary and the 
                Attorney General of the United States, who 
                shall represent the Secretary in the 
                litigation.
          ``(2) Procedure.--
                  ``(A) In general.--The Secretary shall file 
                in the court a record of the proceeding on 
                which the Secretary based the action, as 
                provided in section 2112 of title 28, United 
                States Code.
                  ``(B) Objections.--No objection to the action 
                of the Secretary shall be considered by the 
                court unless the Department has registered the 
                objection before the Secretary.
          ``(3) Disposition.--
                  ``(A) Court Proceedings.--
                          ``(i) Jurisdiction of Court.--The 
                        court shall have jurisdiction to affirm 
                        or modify the action of the Secretary 
                        or to set the action aside in whole or 
                        in part.
                          ``(ii) Findings of Fact.--If 
                        supported by substantial evidence on 
                        the record considered as a whole, the 
                        findings of fact by the Secretary shall 
                        be conclusive.
                          ``(iii) Addition.--The court may 
                        order evidence, in addition to the 
                        evidence submitted for review under 
                        this subsection, to be taken by the 
                        Secretary, and to be made part of the 
                        record.
                  ``(B) Secretary.--
                          ``(i) In general.--The Secretary, by 
                        reason of the additional evidence 
                        referred to in subparagraph (A) and 
                        filed with the court--
                                  ``(I) may--
                                          ``(aa) modify the 
                                        findings of fact of the 
                                        Secretary; or
                                          ``(bb) make new 
                                        findings; and
                                  ``(II) shall file--
                                          ``(aa) such modified 
                                        or new findings; and
                                          ``(bb) the 
                                        recommendation of the 
                                        Secretary, if any, for 
                                        the modification or 
                                        setting aside of the 
                                        original action of the 
                                        Secretary.
                          ``(ii) Findings.--The findings 
                        referred to in clause (i)(II)(bb) 
                        shall, with respect to a question of 
                        fact, be considered to be conclusive if 
                        those findings are--
                                  ``(I) supported by 
                                substantial evidence on the 
                                record; and
                                  ``(II) considered as a whole.
          ``(4) Finality.--
                  ``(A) In general.--Except as provided in 
                subparagraph (B), upon the filing of the record 
                under this subsection with the court--
                          ``(i) the jurisdiction of the court 
                        shall be exclusive; and
                          ``(ii) the judgment of the court 
                        shall be final.
                  ``(B) Review by supreme court.--A judgment 
                under subparagraph (A) shall be subject to 
                review by the Supreme Court of the United 
                States upon writ of certiorari or 
                certification, as provided in section 1254 of 
                title 28, United States Code.

``SEC. 819. MONITORING OF COMPLIANCE.

    ``(a) Enforceable Agreements.--
          ``(1) In general.--The Director, through binding 
        contractual agreements with owners or other authorized 
        entities, shall ensure long-term compliance with the 
        provisions of this title.
          ``(2) Measures.--The measures referred to in 
        paragraph (1) shall provide for--
                  ``(A) to the extent allowable by Federal and 
                State law, the enforcement of the provisions of 
                this title by the Department and the Secretary; 
                and
                  ``(B) remedies for breach of the provisions 
                referred to in paragraph (1).
    ``(b) Periodic Monitoring.--
          ``(1) In general.--Not less frequently than annually, 
        the Director shall review the activities conducted and 
        housing assisted under this title to assess compliance 
        with the requirements of this title.
          ``(2) Review.--Each review under paragraph (1) shall 
        include onsite inspection of housing to determine 
        compliance with applicable requirements.
          ``(3) Results.--The results of each review under 
        paragraph (1) shall be--
                  ``(A) included in a performance report of the 
                Director submitted to the Secretary under 
                section 820; and
                  ``(B) made available to the public.
    ``(c) Performance Measures.--The Secretary shall establish 
such performance measures as may be necessary to assess 
compliance with the requirements of this title.

``SEC. 820. PERFORMANCE REPORTS.

    ``(a) Requirement.--For each fiscal year, the Director 
shall--
          ``(1) review the progress the Department has made 
        during that fiscal year in carrying out the housing 
        plan submitted by the Department under section 803; and
          ``(2) submit a report to the Secretary (in a form 
        acceptable to the Secretary) describing the conclusions 
        of the review.
    ``(b) Content.--Each report submitted under this section 
for a fiscal year shall--
          ``(1) describe the use of grant amounts provided to 
        the Department of Hawaiian Home Lands for that fiscal 
        year;
          ``(2) assess the relationship of the use referred to 
        in paragraph (1) to the goals identified in the housing 
        plan;
          ``(3) indicate the programmatic accomplishments of 
        the Department; and
          ``(4) describe the manner in which the Department 
        would change its housing plan submitted under section 
        803 as a result of its experiences.
    ``(c) Submissions.--The Secretary shall--
          ``(1) establish a date for submission of each report 
        under this section;
          ``(2) review each such report; and
          ``(3) with respect to each such report, make 
        recommendations as the Secretary considers appropriate 
        to carry out the purposes of this title.
    ``(d) Public Availability.--
          ``(1) Comments by beneficiaries.--In preparing a 
        report under this section, the Director shall make the 
        report publicly available to the beneficiaries of the 
        Hawaiian Homes Commission Act, 1920 (42 Stat. 108 et 
        seq.) and give a sufficient amount of time to permit 
        those beneficiaries to comment on that report before it 
        is submitted to the Secretary (in such manner and at 
        such time as the Director may determine).
          ``(2) Summary of comments.--The report shall include 
        a summary of any comments received by the Director from 
        beneficiaries under paragraph (1) regarding the program 
        to carry out the housing plan.

``SEC. 821. REVIEW AND AUDIT BY SECRETARY.

    ``(a) Annual Review.--
          ``(1) In general.--The Secretary shall, not less 
        frequently than on an annual basis, make such reviews 
        and audits as may be necessary or appropriate to 
        determine whether--
                  ``(A) the Director has--
                          ``(i) carried out eligible activities 
                        under this title in a timely manner;
                          ``(ii) carried out and made 
                        certifications in accordance with the 
                        requirements and the primary objectives 
                        of this title and with other applicable 
                        laws; and
                          ``(iii) a continuing capacity to 
                        carry out the eligible activities in a 
                        timely manner;
                  ``(B) The Director has complied with the 
                housing plan submitted by the Director under 
                section 803; and
                  ``(C) the performance reports of the 
                Department under section 821 are accurate.
          ``(2) Onsite visits.--Each review conducted under 
        this section shall, to the extent practicable, include 
        onsite visits by employees of the Department of Housing 
        and Urban Development.
    ``(b) Report by Secretary.--The Secretary shall give the 
Department of Hawaiian Home Lands not less than 30 days to 
review and comment on a report under this subsection. After 
taking into consideration the comments of the Department, the 
Secretary may revise the report and shall make the comments of 
the Department and the report with any revisions, readily 
available to the public not later than 30 days after receipt of 
the comments of the Department.
    ``(c) Effect of Reviews.--The Secretary may make 
appropriate adjustments in the amount of annual grants under 
this title in accordance with the findings of the Secretary 
pursuant to reviews and audits under this section. The 
Secretary may adjust, reduce, or withdraw grant amounts, or 
take other action as appropriate in accordance with the reviews 
and audits of the Secretary under this section, except that 
grant amounts already expended on affordable housing activities 
may not be recaptured or deducted from future assistance 
provided to the Department of Hawaiian Home Lands.

``SEC. 822. GENERAL ACCOUNTING OFFICE AUDITS.

    ``To the extent that the financial transactions of the 
Department of Hawaiian Home Lands involving grant amounts under 
this title relate to amounts provided under this title, those 
transactions may be audited by the Comptroller General of the 
United States under such regulations as may be prescribed by 
the Comptroller General. The Comptroller General of the United 
States shall have access to all books, accounts, records, 
reports, files, and other papers, things, or property belonging 
to or in use by the Department of Hawaiian Home Lands 
pertaining to such financial transactions and necessary to 
facilitate the audit.

``SEC. 823. REPORTS TO CONGRESS.

    ``(a) In General.--Not later than 90 days after the 
conclusion of each fiscal year in which assistance under this 
title is made available, the Secretary shall submit to the 
Congress a report that contains--
          ``(1) a description of the progress made in 
        accomplishing the objectives of this title;
          ``(2) a summary of the use of funds available under 
        this title during the preceding fiscal year; and
          ``(3) a description of the aggregate outstanding loan 
        guarantees under section 184A of the Housing and 
        Community Development Act of 1992.
    ``(b) Related Reports.--The Secretary may require the 
Director to submit to the Secretary such reports and other 
information as may be necessary in order for the Secretary to 
prepare the report required under subsection (a).

``SEC. 824. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to the Department 
of Housing and Urban Development for grants under this title 
such sums as may be necessary for each of fiscal years 1999, 
2000, 2001, 2002 and 2003.''.

           *       *       *       *       *       *       *

    Subtitle E of title I of the Housing and Community 
Development Act of 1992 is amended by inserting after section 
184 (12 U.S.C. 1715z-13a) the following:

``SEC. 184A. LOAN GUARANTEES FOR NATIVE HAWAIIAN HOUSING.

    ``(a) Definitions.--In this section:
          ``(1) Department of hawaiian home lands.--The term 
        Department of Hawaiian Home Lands' means the agency or 
        department of the government of the State of Hawaii 
        that is responsible for the administration of the 
        Hawaiian Homes Commission Act, 1920 (42 Stat. 108 et 
        seq.).
          ``(2) Eligible entity.--The term `eligible entity' 
        means a Native Hawaiian family, the Department of 
        Hawaiian Home Lands, the Office of Hawaiian Affairs, or 
        private nonprofit or for-profit organizations 
        experienced in the planning and development of 
        affordable housing for Native Hawaiians.
          ``(3) Family.--The term `family' means 1 or more 
        persons maintaining a household, as the Secretary shall 
        by regulation provide.
          ``(4) Guarantee fund.--The term `Guarantee Fund' 
        means the Native Hawaiian Housing Loan Guarantee Fund 
        established under subsection (i) of this section.
          ``(5) Hawaiian home lands.--The term `Hawaiian Home 
        Lands' means lands that--
                  ``(A) have the status of Hawaiian Home Lands 
                under section 204 of the Hawaiian Homes 
                Commission Act (42 Stat. 110); or
                  ``(B) are required pursuant to that Act.
          ``(6) Native hawaiian.--The term `Native Hawaiian' 
        has the meaning given the terms `native Hawaiian' in 
        section 201 of the Hawaiian Homes Commission Act, 1920 
        (42 Stat. 108 et seq.).
          ``(7) Office of hawaiian affairs.--The term `Office 
        of Hawaiian Affairs' means the entity of that name 
        established under the constitution of the State of 
        Hawaii.
    ``(b) Authority.--To provide access to sources of private 
financing to Native Hawaiian families who otherwise could not 
acquire housing financing because of the unique legal status of 
the Hawaiian Home Lands or as a result of a lack of access to 
private financial markets, the Secretary may guarantee an 
amount not to exceed 100 percent of the unpaid principal and 
interest that is due on an eligible loan under subsection (b).
    ``(c) Eligible Loans.--Under this section, a loan is an 
eligible loan if that loan meets the following requirements:
          ``(1) Eligible borrowers.--The loan is made only to a 
        borrower who--
                  ``(A) is a Native Hawaiian family;
                  ``(B) the Department of Hawaiian Home Lands;
                  ``(C) the Office of Hawaiian Affairs; or
                  ``(D) a private nonprofit organization 
                experienced in the planning and development of 
                affordable housing for Native Hawaiians.
          ``(2) Eligible housing.--
                  ``(a) In general.--The loan will be used to 
                construct, acquire, or rehabilitate not more 
                than 4-family dwellings that are standard 
                housing and are located on Hawaiian Home Lands 
                for which a housing plan described in sub-
                paragraph (B) applies.
                  ``(B) Housing plan.--A housing plan described 
                in this subparagraph is a housing plan that--
                          ``(i) has been submitted and approved 
                        by the Secretary under section 803 of 
                        the Native American Housing Assistance 
                        and Self-Determination Amendments of 
                        1998; and
                          ``(ii) provides for the use of loan 
                        guarantees under this section to 
                        provide affordable homeownership 
                        housing on Hawaiian Home Lands.
          ``(3) Security.--The loan may be secured by any 
        collateral authorized under applicable Federal law or 
        State law.
          ``(4) Lenders.--
                  ``(A) In general.--The loan shall be made 
                only by a lender approved by, and meeting 
                qualifications established by, the Secretary, 
                including any lender described in subparagraph 
                (B), except that a loan otherwise insured or 
                guaranteed by an agency of the Federal 
                Government or made by the Department of 
                Hawaiian Home Lands from amounts borrowed from 
                the United States shall not be eligible for a 
                guarantee under this section.
                  ``(B) Approval.--The following lenders shall 
                be considered to be lenders that have been 
                approved by the Secretary:
                          ``(i) Any mortgagee approved by the 
                        Secretary for participation in the 
                        single family mortgage insurance 
                        program under title II of the National 
                        Housing Act (12 U.S.C.A. 1707 et seq.).
                          ``(ii) Any lender that makes housing 
                        loans under chapter 37 of title 38, 
                        United States Code, that are 
                        automatically guaranteed under section 
                        3702(d) of title 38, United States 
                        Code.
                          ``(iii) Any lender approved by the 
                        Secretary of Agriculture to make 
                        guaranteed loans for single family 
                        housing under the Housing Act of 1949 
                        (42 U.S.C.A. 1441 et seq.).
                          ``(iv) Any other lender that is 
                        supervised, approved, regulated, or 
                        insured by any agency of the Federal 
                        Government.
          ``(5) Terms.--The loan shall--
                  ``(A) be made for a term not exceeding 30 
                years;
                  ``(B) bear interest (exclusive of the 
                guarantee fee under subsection (d) and service 
                charges, if any) at a rate agreed upon by the 
                borrower and the lender and determined by the 
                Secretary to be reasonable, but not to exceed 
                the rate generally charged in the area (as 
                determined by the Secretary) for home mortgage 
                loans not guaranteed or insured by any agency 
                or instrumentality of the Federal Government;
                  ``(C) involve a principal obligation not 
                exceeding--
                          ``(i) 97.75 percent of the appraised 
                        value of the property as of the date 
                        the loan is accepted for guarantee (or 
                        98.75 percent if the value of the 
                        property is $50,000 or less); or
                          ``(ii) the amount approved by the 
                        Secretary under this section; and
                  ``(D) involves a payment on account of the 
                property--
                          ``(i) in cash or its equivalent; or
                          ``(ii) through the value of any 
                        improvements to the property made 
                        through the skilled or unskilled labor 
                        of the borrower, as the Secretary shall 
                        provide.
    ``(d) Certificate of Guarantee.--
          ``(1) Approval process.--
                  ``(A) In general.--Before the Secretary 
                approves any loan for guarantee under this 
                section, the lender shall submit the 
                application for the loan to the Secretary for 
                examination.
                  ``(B) Approval.--If the Secretary approves 
                the application submitted under subparagraph 
                (A), the Secretary shall issue a certificate 
                under this subsection as evidence of the loan 
                guarantee approved.
          ``(2) Standard for approval.--The Secretary may 
        approve a loan for guarantee under this section and 
        issue a certificate under this subsection only if the 
        Secretary determines that there is a reasonable 
        prospect of repayment of the loan.
          ``(3) Effect.--
                  ``(A) In general.--A certificate of guarantee 
                issued under this subsection by the Secretary 
                shall be conclusive evidence of the eligibility 
                of the loan for guarantee under this section 
                and the amount of that guarantee.
                  ``(B) Evidence.--The evidence referred to in 
                subparagraph (A) shall be incontestable in the 
                hands of the bearer.
                  ``(C) Full faith and credit.--The full faith 
                and credit of the United States is pledged to 
                the payment of all amounts agreed to be paid by 
                the Secretary as security for the obligations 
                made by the Secretary under this section.
          ``(4) Fraud and misrepresentation.--This subsection 
        may not be construed--
                  ``(A) to preclude the Secretary from 
                establishing defenses against the original 
                lender based on fraud or material 
                misrepresentation; or
                  ``(B) to bar the Secretary from establishing 
                by regulations that are on the date of issuance 
                or disbursement, whichever is earlier, partial 
                defenses to the amount payable on the 
                guarantee.
    ``(e) Guarantee Fee.--
          ``(1) In general.--The Secretary shall fix and 
        collect a guarantee fee for the guarantee of a loan 
        under this section, which may not exceed the amount 
        equal to 1 percent of the principal obligation of the 
        loan.
          ``(2) Payment.--The fee under this subsection shall--
                  ``(A) be paid by the lender at time of 
                issuance of the guarantee; and
                  ``(B) be adequate, In the determination of 
                the Secretary, to cover expenses and probable 
                losses.
          ``(3) Deposit.--The Secretary shall deposit any fees 
        collected under this subsection in the Native Hawaiian 
        Housing Loan Guarantee Fund established under 
        subsection (j).
    ``(f) Liability Under Guarantee.--The liability under a 
guarantee provided under this section shall decrease or 
increase on a pro rata basis according to any decrease or 
increase in the amount of the unpaid obligation under the 
provisions of the loan agreement involved.
    ``(g) Transfer and Assumption.--Notwithstanding any other 
provision of law, any loan guaranteed under this section, 
including the security given for the loan, may be sold or 
assigned by the lender to any financial institution subject to 
examination and supervision by an agency of the Federal 
Government or of any State or the District of Columbia.
    ``(h) Disqualification of Lenders and Civil Money 
Penalties.--
          ``(1) In general.--
                  ``(A) Grounds for action.--If the Secretary 
                determines that any lender or holder of a 
                guarantee certificate under subsection (c)--
                          ``(i) has failed--
                                  ``(I) to maintain adequate 
                                accounting records;
                                  ``(II) to serve adequately 
                                loans guaranteed under this 
                                section; or
                                  ``(III) to exercise proper 
                                credit or underwriting 
                                judgment; or
                          ``(ii) has engaged in practices 
                        otherwise detrimental to the interest 
                        of a borrower or the United States, the 
                        Secretary may take action under 
                        subparagraph (B).
                  ``(B) Actions.--Upon a determination by the 
                Secretary that a holder of a guarantee 
                certificate under subsection (c) has failed to 
                carry out an activity described in subparagraph 
                (A)(i) or has engaged in practices described in 
                subparagraph (A)(ii), the Secretary may--
                          ``(i) refuse, either temporarily or 
                        permanently, to guarantee any further 
                        loans made by such lender or holder;
                          ``(ii) bar such lender or holder from 
                        acquiring additional loans guaranteed 
                        under this section; and
                          ``(iii) require that such lender or 
                        holder assume not less than 10 percent 
                        of any loss on further loans made or 
                        held by the lender or holder that are 
                        guaranteed under this section.
          ``(2) Civil money penalties for intentional 
        violations.--
                  ``(A) In general.--The Secretary may impose a 
                civil monetary penalty on a lender or holder of 
                a guarantee certificate under subsection (d) if 
                the Secretary determines that the holder or 
                lender has intentionally failed--
                          ``(i) to maintain adequate accounting 
                        records;
                          ``(ii) to adequately service loans 
                        guaranteed under this section; or
                          ``(iii) to exercise proper credit or 
                        underwriting judgment.
                  ``(B) Penalities.--A civil monetary penalty 
                imposed under this paragraph shall be imposed 
                in the manner and be in an amount provided 
                under section 536 of the National Housing Act 
                (12 U.S.C.A. 1735f-1) with respect to 
                mortgagees and lenders under that Act.
          ``(3) Payment on loans made in good faith.--
        Notwithstanding paragraphs (1) and (2), if a loan was 
        made in good faith, the Secretary may not refuse to pay 
        a lender or holder of a valid guarantee on that loan, 
        without regard to whether the lender or holder is 
        barred under this subsection.
    ``(i) Payment Under Guarantee.--
          ``(1) Lender options.--
                  ``(A) In general.--
                          ``(i) Notification.--If a borrower on 
                        a loan guaranteed under this section 
                        defaults on the loan, the holder of the 
                        guarantee certificate shall provide 
                        written notice of the default to the 
                        Secretary.
                          ``(ii) Payment.--Upon providing the 
                        notice required under clause (i), the 
                        holder of the guarantee certificate 
                        shall be entitled to payment under the 
                        guarantee (subject to the provisions of 
                        this section) and may proceed to obtain 
                        payment in 1 of the following manners:
                                  ``(I) Foreclosure.--
                                          ``(aa) In general.--
                                        The holder of the 
                                        certificate may 
                                        initiate foreclosure 
                                        proceedings (after 
                                        providing written 
                                        notice of that action 
                                        to the Secretary).
                                          ``(bb) Payment.--Upon 
                                        a final order by the 
                                        court authorizing 
                                        foreclosure and 
                                        submission to the 
                                        Secretary of a claim 
                                        for payment under the 
                                        guarantee, the 
                                        Secretary shall pay to 
                                        the holder of the 
                                        certificate the pro 
                                        rata portion of the 
                                        amount guaranteed (as 
                                        determined pursuant to 
                                        subsection (f) plus 
                                        reasonable fees and 
                                        expenses as approved by 
                                        the Secretary.
                                          ``(cc) Subrogation.--
                                        The rights of the 
                                        Secretary shall be 
                                        subrogated to the 
                                        rights of the holder of 
                                        the guarantee. the 
                                        holder shall assign the 
                                        obligation and security 
                                        to the Secretary.
                                  ``(II) No foreclosure.--
                                          ``(aa) In general.--
                                        Without seeking 
                                        foreclosure (or in any 
                                        case in which a 
                                        foreclosureproceeding 
initiated under clause (i) continues for a period in excess of 1 year), 
the holder of the guarantee may submit to the Secretary a request to 
assign the obligation and security interest to the Secretary in return 
for payment of the claim under the guarantee. The Secretary may accept 
assignment of the loan if the Secretary determines that the assignment 
is in the best interest of the United States.
                                          ``(bb) Payment.--Upon 
                                        assignment, the 
                                        Secretary shall pay to 
                                        the holder of the 
                                        guarantee the pro rata 
                                        portion of the amount 
                                        guaranteed (as 
                                        determined under 
                                        subsection (f)).
                                          ``(cc) Subrogation.--
                                        The right of the 
                                        Secretary shall be 
                                        subrogated to the 
                                        rights of the holder of 
                                        the guarantee. The 
                                        holder shall assign the 
                                        obligation and security 
                                        to the Secretary.
                  ``(B) Requirements.--Before any payment under 
                a guarantee is made under subparagraph (A), the 
                holder of the guarantee shall exhaust all 
                reasonable possibilities of collection. Upon 
                payment, in whole or in part, to the holder, 
                the note of judgment evidencing the debt shall 
                be assigned to the United States and the holder 
                shall have no further claim against the 
                borrower or the United States. The Secretary 
                shall then take such action to collect as the 
                Secretary determines to be appropriate.
          ``(2) Limitation on liquidation.--
                  ``(A) In general.--If a borrower defaults on 
                a loan guaranteed under this section that 
                involves a security interest in restricted 
                Hawaiian Home Land property, the mortgagee or 
                the Secretary shall only pursue liquidation 
                after offering to transfer the account to 
                another eligible Hawaiian family or to the 
                Department of Hawaiian Home Lands.
                  ``(B) Limitation.--If, after action is taken 
                under subparagraph (A), the mortgagee or the 
                Secretary subsequently proceeds to liquidate 
                the account, the mortgagee or the Secretary 
                shall not sell, transfer, or otherwise dispose 
                of or alienate the property described in 
                subparagraph (A) except to another eligible 
                Hawaiian family or to the Department of 
                Hawaiian Home Lands.
    ``(j) Hawaiian Housing Loan Guarantee Fund.--
          ``(1) Establishment.--There is established in the 
        Treasury of the United States the Hawaiian Housing Loan 
        Guarantee Fund for the purpose of providing loan 
        guarantees under this section.
          ``(2) Credits.--the Guarantee Fund shall be credited 
        with--
                  ``(A) any amount, claims, notes, mortgages, 
                contracts, and any collections and proceeds 
                therefrom:
                  ``(B) any amounts appropriated pursuant to 
                paragraph (7);
                  ``(C) any guarantee fees collected under 
                subsection (d); and
                  ``(D) any interest or earnings on amounts 
                invested under paragraph (4).
          ``(3) Use.--Amounts in the Guarantee Funds shall be a 
        available, to the extent provided in appropriations 
        Acts, for--
                  ``(A) fulfilling any obligations of the 
                Secretary with respect to loans guaranteed 
                under this section, including the costs (as 
                that term is defined in section 502 of the 
                Federal Credit Reform Act of 1990 (2 U.S.C. 
                661A)) of such loans;
                  ``(B) paying taxes, insurance, prior liens, 
                expenses necessary to make fiscal adjustment in 
                connection with the application and transmittal 
                of collections, and other expenses and advances 
                to protect the Secretary for loans which are 
                guaranteed under this section or held by the 
                Secretary;
                  ``(C) acquiring such security property at 
                foreclosure sales or otherwise;
                  ``(D) paying administrative expenses in 
                connection with those section; and
                  ``(E) reasonable and necessary costs of 
                rehabilitation and repair to properties that 
                the Secretary hold or owns pursuant to this 
                section.
          ``(4) Investment.--Any amounts in the Guarantee Fund 
        determined by the Secretary to be in excess of amounts 
        currently required at the time of the determination to 
        carry our this section may be invested in obligations 
        of the United States.
          ``(5) Limitation on commitments to guarantee loans 
        and mortgages.--
                  ``(A) Requirement of appropriations.--The 
                authority of the Secretary to enter into 
                commitments to guarantee loans under this 
                section shall be effective for any fiscal year 
                to the extent, or in such amounts as, are or 
                have been provided in appropriations Acts, 
                without regard to the fiscal year for which 
                such amounts were appropriated.
                  ``(B) Limitations on costs of guarantees.--
                The authority of the Secretary to enter into 
                commitments to guarantee loans under this 
                section shall be effective for any fiscal year 
                only to the extent that amounts in the 
                Guarantee Fund are or have been made available 
                in appropriations Acts to cover the costs (as 
                that term is defined in section 502 of the 
                Federal Credit Reform Act of 1990 (2 U.S.C. 
                661a)) of such loan guarantees for such fiscal 
                year. Any amounts appropriated pursuant to this 
                subparagraph shall remain available until 
                expended.
                  ``(C) Limitation of outstanding aggregate 
                principal amount.--Subject to the limitations 
                in subparagraphs (A) and (B), the Secretary may 
                enter into commitments to guarantee loans under 
                this section for each of fiscal years 1999, 
                2000, 2001, 2002, and 2003 with an aggregate 
                outstanding principal amount not exceeding 
                $100,000,000 for each such fiscal year.
          ``(6) Liabilities.--All liabilities and obligations 
        of the assets credited to the Guarantee Fund under 
        paragraph (2)(A) shall be liabilities and obligations 
        of the Guarantee Fund.
          ``(7) Authorization of appropriations.--There are 
        authorized to be appropriated to the Guarantee Fund to 
        carry out this section such sums as may be necessary 
        for each of fiscal years 1999, 2000, 2001, 2002, and 
        2003.
    ``(k) Requirements for Standard Housing.--
          ``(1) In general.--The Secretary shall, by 
        regulation, establish housing safety and quality 
        standards to be applied for use under this section.
          ``(2) Standards.--The standards referred to in 
        paragraph (1) shall--
                  ``(A) provide sufficient flexibility to 
                permit the use of various designs and materials 
                in housing acquired with loans guaranteed under 
                this section; and
                  ``(B) require each dwelling unit in any 
                housing acquired in the manner described in 
                subparagraph (A) to--
                          ``(i) be decent, safe, sanitary, and 
                        modest in size and design;
                          ``(ii) conform with applicable 
                        general construction standards for the 
                        region in which the housing is located;
                          ``(iii) contain a plumbing system 
                        that--
                                  ``(I) uses a properly 
                                installed system of piping;
                                  ``(II) includes a kitchen 
                                sink and a partitional bathroom 
                                with lavatory, toilet, and bath 
                                or shower; and
                                  ``(III) uses water supply, 
                                plumbing, and sewage disposal 
                                systems that conform to any 
                                minimum standards established 
                                by the applicable county or 
                                State;
                          ``(iv) contain an electrical system 
                        using wiring and equipment properly 
                        installed to safely supply electrical 
                        energy for adequate lighting and for 
                        operation of appliances that conforms 
                        to any appropriate county, State, or 
                        national code;
                          ``(v) be not less than the size 
                        provided under the applicable locally 
                        adopted standards for size of dwelling 
                        units, except that the Secretary, upon 
                        request of the Department of Hawaiian 
                        Home Lands may waive the size 
                        requirements under this paragraph; and
                          ``(vi) conform with the energy 
                        performance requirements for new 
                        construction established by the 
                        Secretary under section 526(a) of the 
                        National Housing Act (12 U.S.C.A. 
                        1735f-4), unless the Secretary 
                        determines that the requirements are 
                        not applicable.
    ``(l) Applicability of Civil Rights Statutes.--To the 
extent that the requirements of title VI of the Civil Rights 
Act of 1964 (42 U.S.C. 2000d et seq.) or of title VIII of the 
Civil Rights Act of 1968 (42 U.S.C. 3601 et seq.) apply to a 
guarantee provided under this subsection, nothing in the 
requirements concerning discrimination on the basis of race 
shall be construed to prevent the provision of the guarantee to 
an eligible entity on the basis that the entity serves Native 
Hawaiian families or is a Native Hawaiian family.''.
      

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                               APPENDIX A

                     Hawaiian Homes Commission Act

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                               APPENDIX B

                         Hawaiian Admission Act

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                               APPENDIX C

                Hawaiian State Constitution, as amended

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                               APPENDIX D

                   Department of Hawaiian Home Lands

                     Beneficiary Needs Study, 1995

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                               APPENDIX E

                           Executive Summary

             Housing Problems and Needs of Native Hawaiians

                         Study prepared for the

            U.S. Department of Housing and Urban Development

                                   by

       The Urban Institute, Center for Public Finance and Housing

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