View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

106 STAT. 3672

PUBLIC LAW 102-550—OCT. 28, 1992

Public Law 102-550
102d Congress

An Act
Oct. 28, 1992
[H.R. 5334]
Housing and
Community
Development
Act of 1992.
42 u s e 5301
note.

To amend and extend certain laws relating to housing and community development,
and for other purposes.

Be it enacted by the Senate and House of Representatives of
the United States ofAmerica in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) SHORT TITLE.—^This Act may be cited as the

Community Development Act of 1992".
Sec.
Sec.

"Housing and

(b) TABLE OF CONTENTS.—
Short title and table of contents.
Effective date.

Sec. 101.
Sec. 102.
Sec. 103.
Sec. 104.
Sec. 105.
Sec. 106.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

111.
112.
113.
114.
115.
116.
117.
118.
119.
120.
121.
122.
123.
124.
125.
126.
127.
128.

Sec.
Sec.
Sec.
Sec.

129.
130.
131.
132.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

141.
142.
143.
144.
145.
146.
147.
148.

TITLE I—HOUSING ASSISTANCE
Subtitle A—General Provisions
Low-income housing authorization.
Extension of ceiling rents.
Definitions of income and a4justed income and applicability to Indian
housing programs.
Public ana section 8 housing tenant preference rules.
Income eligibility for assist^ housing.
Family self-sufficiency program.
Subtitle B—^Public and Indian Housing
Major reconstruction of obsolete projects.
Public housing tenant preferences.
Reform of public housing management.
Public housing operating subsidies.
Public housing vacancy reduction.
Public housing demolition and disposition.
Public housing resident management.
Public housing homeownership.
Public housing family investment centers.
Revitalization of severely distressed public housing.
Choice in public housing management.
Assisted housing for Indians and Alaska Natives.
Public housing early childhood development services.
Indian housing childhood development services.
Public housing one-stop perinatal services demonstration.
Public housing youth sports programs.
National Commission on Distressed Public Housing.
National Commission on American Indian, Alaska Native, and Native Hawaiian Housing.
Rental assistance fraud recoveries.
Project-based accounting.
Sede of certain scattered-site housing.
Homeownership demonstration program in Omaha, Nebraska.
Subtitle C—Section 8 Assistance
Eligibility of low-income families to receive rental assistance.
Contract adjustments for expiration of property tax exemption.
Termination of contracts.
Preferences for veterans with disabilities that prevent use of home.
Termination of tenancy for criminal activity.
Definitions of "project-based assistance" and "tenant-based assistance".
Portability.
Family unification assistance.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3673

Sec. 149. Implementation of amendments to project-based certificate program.
Sec. 150. Effectiveness of section 8 assistance for FHA-owned units.
Sec. 151. Implementation of income eligibility provisions for section 8 new construction units.
Sec. 152. Moving to opportimity for fair housing.
Sec. 153. Directive to further fair housing objectives under certificate and voucher
programs.
Sec. 154. Housing assistance in Jefferson County, Texas.
Sec. 155. Compliance of certain activities with limitations on project-based assistance.
Sec.
Sec.
Sec.
Sec.
Sec.

161.
162.
163.
164.
165.

Subtitle D—Other Programs
Public and assisted housing drug elimination.
Housing counseling.
Use of funds recapturedfix>mrefinancing State and local finance projects.
HOPE for youth.
Extension for commencement of certain construction.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

181.
182.
183.
184.
185.
186.

Subtitle E—Homeownership Programs
HOPE programs.
National Homeownership Trust demonstration.
Nehemiah housing opportunity grants.
Loan guarantees for Indian housing.
Assistance under section 8 for homeownership.
Enterprise zone homeownership opportunity grants.
Subtitle F—Implementation

Sec. 191. Implementation.
Sec.
Sec.
Sec.
Sec.

201.
202.
203.
204.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

205.
206.
207.
208.
209.
210.
211.
212.
213.
214.
215.

Sec. 216.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

217.
218.
219.
220.
221.
222.
223.

TITLE II—HOME INVESTMENT PARTNERSHIPS
Authorization of appropriations.
Home program thresholds.
Elimination of restrictions on new construction.
Policies and preference rules; use of tenant-based rental assistance
amounts for security deposits.
Use of home funds for homeless assistance.
Per unit cost limits.
Administrative costs as eligible use of investment.
Affordable housing.
Homeownership resale restrictions.
Matching requirements.
Assistance for insular areas.
Community housing production set-aside.
Housing education and organizational support for community land trusts.
Land bank redevelopment.
Research in providing affordable housing through innovative building
techniques and technology.
Use of innovative building technologies to provide cost-saving housing opportunities.
Definition of community housing development organization.
Inclusion of echo housing in definition of housing.
Eligibility of manufactured homeowners as first-time homebuyers.
Eligibility for assistance and contents of strategies.
Location of activities.
Regulations.
Retroactive application of home amendments.
TITLE III—PRESERVATION OF LOW-INCOME HOUSING

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

Subtitle A—^Prepajrment of Mortgages Insured Under National Housing Act
301. Authorization of appropriations.
302. Guidelines for appraisals of preservation value.
303. Second notice of intent.
304. Plan of action.
305. Approval of plan of action.
306. Receipt of incentives to extend low-income use.
307. Transfer to qualified purchasers.
308. Criteria for plan of action involving incentives.
309. Resident homeownership program.
310. Definition of eligible low-income housing.
311. Preemption of State and local laws.

106 STAT. 3674
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

PUBLIC LAW 102-550—OCT. 28, 1992
312.
313.
314.
315.
316.
317.
318.

Technical assistance and capcuaty btiilding.
Transition provisions.
Conditions of assistance.
Delegated responsibility to State agencies.
Insurance for second mortgage financing.
Technical amendments.
Study of proj^rts assisted imder flexible subsidy program.

Subtitle B—Other Preservation Provisions
Sec. 331. Eligibility of public mortgagors for section 236 mortgage insurance.
Sec. 332. Regulations.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

TITLE IV—MULTIFAMILY HOUSING PLANNING AND INVESTMENT
STRATEGIES
401. Definitions.
402. Required submission.
403. Contents.
404. Submission and review.
405. Troubled multifamily housing.
406. Flexible subsidy program.
407. Capacity study.
408. Flexible subsidy program.

TITLE V—MORTGAGE INSURANCE AND SECONDARY MORTGAGE MARKET
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

501.
502.
503.
504.
505.
506.
507.
508.
509.
510.
511.

Sec. 512.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

513.
514.
515.
516.
517.
518.
519.
520.

Subtitle A—^FHA Mortgage Insurance Programs
Limitation on insurance authority.
Federal Housing Administration Advisory Board.
Maximum mortgage amount.
FHA annual report.
Maximiun principal obligation of mortgages for veterans.
Prepurchase counseling requirement.
Authority to decrease insurance premium charges.
Statute of limitations on payment of distributive shares.
Mortgage limits for multifamily projects.
Insurance of loans for operating losses of multifamily projects.
Eligibility of assisted living facilities for mortgage insurance under section 232.
Expediting insurance for acquisition of Resolution Trust Corporation
property.
Energy enicient mortgages pilot program.
Study regarding home warranty plans.
Expenditures to correct defects.
Payment of mortgage insurance claims.
Coverage of the Miutifamily Mortgage Foreclosure Act.
Mortgagee Review Board.
Definition of mortgagee.
Exemption from section 137(b) of the Truth in Lending Act.

Subtitle B—Secondary Mortgage Market Programs
Sec. 531. Limitation on GNMA guarantees of mortgage-backed securities.
Sec. 532. Authority for GNMA to make hardship interest pajrments.
Sec.
Sec.
Sec.
Sec.

541.
542.
543.
544.

Subtitle C—Improvement of Financing for Multifamily Housing
Short title.
Multifamily mortgage credit demonstrations.
National interagency task force on multifamily housing.
Definitions.

TITLE VI—HOUSING FOR ELDERLY PERSONS AND PERSONS WITH
DISABILITIES
Subtitle A—Supportive Housing Programs
Sec. 601. Funding for supportive housing for the elderly and for {>ersons with disabilities.
Sec. 602. Supportive housing for the elderl]^.
Sec. 603. Supportive housing for persons with disabilities.
Sec. 604. Revised congregate housing services program.
Sec. 605. HOPE for elderly independence.
Sec. 606. Housing opportunities for persons with AIDS.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3675

Subtitle B—Authority for Public Housing Agencies to Provide Designated Public
Housing and Assistance for Disabled Families
Sec. 621. Definitions.
Sec. 622. Authority.
Sec. 623. Tenant-based assistance for persons with disabilities.
Sec. 624. Development and reconstruction of housing for disabled families.
Sec. 625. Conforming amendments.
Sec. 626. Inapplicability to Indian public housing.
Subtitle C—Standards and Obligations of Residency in Federally Assisted Housing
Sec. 641. Compliance by owners as condition of Federal assistance.
Sec. 642. Compliance with criteria for occupancy as requirement for tenancy.
Sec. 643. Establishment of criteria for occupancy.
Sec. 644. Assisted applications.
Subtitle D—^Authority to Provide Preferences for Elderly Residents and Units for
Disabled Residents in Certain Section 8 Assisted Housing
Sec. 651. Authority.
Sec. 652. Reservation of units for disabled families.
Sec. 653. Secondary preferences.
Sec. 654. General availability of units.
Sec. 655. Preference within groups.
Sec. 656. Prohibition of evictions.
Sec. 657. Treatment of covered section 8 housing not subject to elderly preference.
Sec. 658. Treatment of other federally assisted housing.
Sec. 659. Covered section 8 housing.
Sec. 660. Section 8 preference.
Sec. 661. Study.
Subtitle E—Service Coordinators for Elderly and Disabled Residents of Federally
Assisted Housing
Sec.
Sec.
Sec.
Sec.
Sec.

671.
672673.
674.
675.

Requirement to provide service coordinators.
Required training of service coordinators.
Costs of providing service coordinators in public housing.
Costs of providing service coordinators in project-based section 8 housing.
Costs of providing service coordinators for families receiving Federal tenant-based assistance.
Sec. 676. Grants for costs of providing service coordinators in multifamily housing
assisted under National Housing Act.
Sec. 677. Expanded responsibilities of service coordinators in section 202 housing.
Sec.
Sec.
Sec.
Sec.
Sec.

681.
682.
683.
684.
685.

Subtitle F—General Provisions
Comprehensive housing affordability strategies.
Conforming amendments.
Definitions.
Applicability.
Regulations.

TITLE VII—RURAL HOUSING
Sec. 701. Program authorizations.
Sec. 702. Eligibility of homes on leased land owned by community land trusts for
section 502 loans.
Sec. 703. Maximum income of borrowers under guaranteed loans.
Sec. 704. Remote rural areas.
Sec. 705. Designation of underserved areas and reservation of assistance.
Sec. 706. Rural Housing Voucher program.
Sec. 707. Rental housing loans.
Sec. 708. Nonprofit set-aside.
Sec. 709. Consideration of certain areas as rural areas.
Sec. 710. Permanent authority for section 523.
Sec. 711. Housing preservation grants for replacement of housing.
Sec. 712. Preservation.
Sec. 713. Disaster assistance.
Sec. 714. Prohibition on transfer of rural housing programs.
Sec. 715. Site acquisition and development.
Sec. 716. Reciprocity in approval of housing subdivisions among Federal agencies.

106 STAT. 3676

PUBLIC LAW 102-550—OCT. 28, 1992
TITLE VIII—COMMUNITY DEVELOPMENT
Subtitle A—Community Development Block Grants
Community development authorizations.
Units of general local government.
Urban counties.
Retention of program income.
Economic development.
Evaluation, selection, and review of economic development projects.
Eligible activities.
Reference to Fair Housing Act.
Eligibility of enterprise zones.
Assistance for colonias.
'
State set-aside for technical assistance.
Community development plans and reports.
Delay use of 1990 census housing data to examine effect on targeting for
CDBG formula.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

801.
802.
803.
804.
805.
806.
807.
808.
809.
810.
811.
812.
813.

Sec.
Sec;
Sec.
Sec.

831.
832.
833.
834.

Subtitle B—Other Community Development Programs
Neighborhood Reinvestment Corporation.
Neighborhood development program.
Study regarding housing technology research.
Designation of enterprise zones.

Sec.
Sec.
Sec.
Sec.

851.
852.
853.
854.

Subtitle C—Miscellaneous Programs
Community Outreach Act.
Computerized database of commtinity development needs.
Community Investment Corporation demonstration.
Emergency assistance for Los Angeles.

TITLE DC—REGULATORY AND MISCELLANEOUS PROGRAMS
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

901.
902.
903.
904.
905.
906.
907.
908.
909.
910.
911.
912.
913.

Sec. 914.
Sec. 915.
Sec. 916.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

917.
918.
919.
920.
921.
922.
923.
924.
925.
926.
927.
928.
929.
930.
931.
932.
933.

Subtitle A—Miscellaneous
HUD research and development.
Administration of Department of Housing and Urban Development.
Participant's consent to release of information.
National Institute of Building Sciences.
Fair housing initiatives program.
National Commission on Manufactured Housing.
Manufactured housing.
Real Estate Settlement Procedures Act of 1974.
Community Reinvestment Act of 1977.
Report on community development lending.
Subsidy layering review.
Solar assistance financing entity.
Technical and Conforming Amendments relating to labor wage rates
under housing programs.
Energy efficient mortgages.
Economic opportunities for low- and very low-income persons.
Study of the effectiveness of section 3 of the Housing and Urban Development Act of 1968.
Indian housing authorities.
Study regarding foreclosure alternatives.
Regulations clarifying the term "housing for older persons".
Use of domestic products.
Improved coordination of urban policy.
Prohibition of lump-sum payments.
'"
Economic independence.
Administrative provision.
Performance goals.
Regulation of consultants.
Clarification on utility allowances.
Flood control restoration zone.
Salaries and expenses.
The National Cities in Schools Community Development program.
Bank Enterprise Act of 1991 and related provisions.
Disclosures under the Home Mortgage Disclosure Act of 1975.
Prohibition on use of "rule of 78's" in connection with mortgage
refinancings and other consumer loans.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3677

Subtitle B—Bank Regulatory Clarification Provisions
Sec. 951. Amendment relating to estimates of real estate settlement costs.
Sec. 952. A4justable rate mortgage caps.
Sec. 953. Modifying separate capitalization rule for savings associations' subsidiaries engaged in activities not permissible for national banks.
Sec. 954. Real estate appraisal amendment.
Sec. 955. Insider lending.
Sec. 956. Clarification of compensation standards.
Sec. 957. Truth in Savings Act amendments.
TITLE X—RESIDENTIAL LEAD-BASED PAINT HAZARD REDUCTION ACT OF
1992
Sec. 1001. Short title.
Sec. 1002. Findings.
Sec. 1003. Purposes.
Sec. 1004. Definitions.
Subtitle A—Lead-Based Paint Hazard Reduction
Sec. 1011. Grants for lead-based paint hazard reduction in target housing.
Sec. 1012. Evaluation and reduction of lead-based paint hazards in federally assisted housing.
Sec. 1013. Disposition of federally owned housing.
Sec. 1014. Comprehensive housing afifordability strategy.
Sec. 1015. Task force on lead-based paint hazard reduction and financing.
Sec. 1016. National consultation on lead-based paint hazard reduction.
Sec. 1017. Guidelines for lead-based paint hazard evaluation and reduction activities.
Sec. 1018. Disclosure of information concerning lead upon transfer of residential
property.
Subtitle B—Lead Exposure Reduction
Sec. 1021. Contractor training and certification.
Subtitle C—^Worker Protection
Sec. 1031. Worker protection.
Sec. 1032. Coordination between Environmental Protection Agency and Department of Labor.
Sec. 1033. NIOSH responsibilities.
Subtitle D—Research and Development
PART 1—HUD RESEARCH

Sec. 1051. Research on lead exposurefit)mother sources.
Sec. 1052. Testing technologies.
Sec. 1063. Authorization.
PART 2—GAO REPORT

Sec. 1056. Federal implementation and insurance study.
Subtitle E—Reports
Sec. 1061. Reports of the Secretary of Hoiising and Urban Development.
TITLE XI—NEW TOWNS DEMONSTRATION PROGRAM FOR EMERGENCY
REUEF OF LOS ANGELES
Sec. 1101. Authority.
Sec. 1102. New town plan.
Sec. 1103. New town development demonstration program requirements.
Sec. 1104. Federal mortgage insurance.
Sec. 1105. Secondary soft mortgagefinancingfor housing.
Sec. 1106. Community development assistance.
Sec. 1107. Governing boards.
Sec. 1108. Reports.
Sec. 1109. Definitions.
TITLE XII—REMOVAL OF REGULATORY BARRIERS TO AFFORDABLE
HOUSING
Sec. 1201. Short title.
Sec. 1202. Purposes.

106 STAT. 3678

PUBLIC LAW 102-550—OCT. 28, 1992

Sec.
Sec.
Sec.
Sec.

1203.
1204.
1205.
1206.

Definition of regulatory barriers to affordable housing.
Grants for regulatory barrier removal strategies and implementation.
Regulatory barriers clearinghouse.
Substantially equivalent Federal and State barrier assessment removal
requirements.
Sec. 1207. Reports by Secretary.
Sec.
Sec.
Sec.
Sec.

1301.
1302.
1303.
1304.

TITLE XIII—GOVERNMENT SPONSORED ENTERPRISES
Short title.
Congressional findings.
Definitions.
Protection of taxpayers against liability.
Subtitle A—Supervision and Regulation of Enterprises
PART 1—FINANCIAL SAFETY AND SOUNDNESS REGULATOR

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1311. Establishment of Office of Federal Housing Enterprise Oversight.
1312. Director.
1313. Duty and authority of director.
1314. Authority to require reports by enterprises.
1315. Personnel.
1316. Funding.
1317. Examinations.
1318. Prohibition of excessive compensation.
1319. Authority to provide for review of enterprises by rating organization.
1319A. Equal opportunity in solicitation of contracts.
1319B. Annual reports by director.
1319C. Public disclosure of final orders and agreements.
1319D. Limitation on subsequent employment.
1319E. Audits by GAO.
1319F. Information, records, and meetings.
1319G. Regulations and orders.
PART 2—AUTHORITY OF SECRETARY
SUBPART A—GENERAL AUTHORITY

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1321. Regulatory authority.
1322. Prior approval authority for new programs.
1323. Public access to mortgage information.
1324. Annual housing report.
1325. Fair housing.
1326. Prohibition of public disclosure of proprietary information.
1327. Authority to require reports by enterprises.
1328. Reports by Secretary.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1331.
1332.
1333.
1334.
1335.
1336.
1337.
1338.

Establishment.
,Low- and moderate-income housing goal.
Special affordable housing goal.
Central cities, rural areas, and other underserved areas housing goal.
Other requirements.
Monitoring and enforcing compliance with housing goals.
Reports during transition.
Effective date of transition goals.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1341.
1342.
1343.
1344.
1345.
1346.
1347.
1348.
1349.

Cease-and-desist proceedings.
Hearings.
Judicial review.
Enforcement and jurisdiction.
.. ,.
Civil money penalties.
Public disclosure of final orders and agreements.
Notice of service.
Subpoena authority.
Regulations.

Sec.
Sec.
Sec.
Sec.

1351. Amendments to title 5, United States Code.
1352. Prohibition of merger of office.
1353. Protection of confidential information.
1354. Review of underwriting guidelines.

SUBPART B—HOUSING GOALS

SUBPART C—ENFORCEMENT OF HOUSING GOALS

PART 3—MISCELLANEOUS PROVISIONS

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3679

Sec. 1355. Studies ofeffectsofprivatization of FNMA and FHLMC.
Sec. 1356. Transition.
Subtitle B—Required Capital Levels for Enterprises and Special Enforcement
Powers
Sec. 1361. Risk-based capital levels.
Sec. 1362. Minimum capital levels.
Sec. 1363. Critical capital levels.
Sec. 1364. Capital classifications.
Sec. 1365. Supervisory actions applicable to undercapitalized enterprises.
Sec. 1366. Supervisory actions applicable to significantly undercapitalized enterprises.
Sec. 1367. Appointment of conservators for critically undercapitalized enterprises.
Sec. 1368. Notice of classification and enforcement action.
Sec. 1369. Appointment of conservators.
Sec. 1369A. Powers of conservators.
Sec. 1369B. Liability protection for conservators.
Sec. 1369C. Capital restoration plans.
Sec. 1369D. Judicial review of director action.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

Subtitle C—Enforcement Provisions
1371. Cease-suid-desist proceedings.
1372. Temporary cease-and-desist orders.
1373. Hearings.
1374. Judicial review.
1375. Enforcement and jurisdiction.
1376. Civil money penalties.
1377. Notice after separation from service.
1378. Private rights of action.
1379. Public disclosure of final orders and agreements.
1379A. Notice of service.
1379B. Subpoena authority.

Subtitle D—^Amendments to Charter Acts of Enterprises
Sec. 1381. Amendments to Federal National Mortgage Association Charter Act.
Sec. 1382. Amendments to Federal Home Loan Mortage Corporation Act.
Sec. 1383. Implementation.
Subtitle E—Regulation of Federal Home Loan Bank System
Sec. 1391. Primacy of financial safety and soundness for Federal Housing Finance
Board.
Sec. 1392. Advances under Federal Home Loan Bank Act.
Sec. 1393. Studies regarding Federal Home Loan Bank system.
Sec. 1394. Report of Federal Home Loan Bank members.
Sec. 1395. Reports regarding consolidation of Federal Home Loan Bank system.
TITLE XIV—HOUSING PROGRAMS UNDER STEWART B. MCKINNEY
HOMELESS ASSISTANCE ACT
Subtitle A—^Housing Assistance
Short title.
Emergency Shelter Grants program.
Supportive Housing program.
Safe Havens for Homeless Individuals Demonstration program.
Section 8 assistance for single room occupancy dwellings.
Shelter Plus Care program.
FHA single family property disposition.
Rural Homelessness Grant program.
Evaluation of prc^prams.
Extension of original McKinney Act Housing programs.
Consultation and report regarding use of National Guard facilities as
overnight shelters for homeless individuals.
Sec. 1412. Strategy to eliminate unfit transient facilities.
Sec. 1413. Amendments to table of contents.
Sec. 1414. Use of FMHA inventory for transitional housing for homeless persons
and for turnkey housing.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1401.
1402.
1403.
1404.
1405.
1406.
1407.
1408.
1409.
1410.
1411.

Subtitle B—^Interagency Council on the Homeless
Sec. 1421. Authorization of appropriations.
Sec. 1422. Extension.

!()(> STAT. 3680

PUBLIC LAW 102-550—OCT. 28, 1992

Subtitle C—^Federal Emergency Management Food and Shelter Program
Sec. 1431. Authorization of appropriations.
Sec. 1432. Employment and participation of homeless individuals in local programs.
TITLE XV—ANNUNZIO-WYLIE ANTI-MONEY LAUNDERING ACT
Sec. 1500. Short title.
Subtitle A—^Termination of Charters, Insurance, and Offices
Sec. 1501. Authority to appoint conservator for depository institutions convicted of
money laundering.
Sec. 1502. Revoking charter of Federal depository institutions convicted of money
laundering or cash transaction reporting offenses.
Sec. 1503. Terminating insurance of State depository institutions convicted of
money laundering or cash transaction reporting offenses.
Sec. 1504. Removing parties involved in currency reporting violations.
Sec. 1505. Unauthorized participation.
Sec. 1506. Access by State financial institution supervisors to currency transactions
reports.
Sec. 1507. Restricting State branches and agencies of foreign banks convicted of
money laundering offenses.

Sec.
Sec.

Subtitle B—Nonbank Financial Institutions and General Provisions
1511. Identification of financial institutions.
1512. Prohibition of illegal money transmitting businesses.
1513. Compliance procedures.
1514. Nondisclosure of orders.
1515. Provisions relating to recordkeeping with respect to certain funds transfers.
1516. Use of certain records.
1517. Suspicious transactions and financial institution anti-money laundering
programs.
1518. Anti-money laundering training team.
1519. International money laundering reports.

Sec.
Sec.
Sec.
Sec.

1521.
1522.
1523.
1524.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

1525.
1526.
1527.
1528.
1529.
1530.
1531.
1532.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

Sec. 1533.
Sec. 1534.
Sec. 1535.
Sec. 1536.

Subtitle C—^Money Laundering Enforcement Improvements
Jurisdiction in civil forfeiture cases.
Civil forfeiture of fungible property.
t
Procedure for subpoenaing bank records.
Deletion of redundant and inadvertently limiting provision in 18
U.S.C. 1956.
Structuring transactions to evade CMIR requirement.
Clarification of definition of financial institution.
Definition of financial transaction.
Obstructing a money laundering investigation.
Awards in money laundering cases.
Penalty for money laundering conspiracies.
Technical and conforming amendments to money laundering provision.
Preclusion of notice to possible suspects of existence of a grand jury subpoena for bank records in money laundering and controlled substance
investigations.
Elimination of restriction on disposal of forfeited property by the Department of the Treasury and the Postal Service.
New money laundering predicate offenses.
Amendments to the Banx Secrecy Act.
Expansion of money laundering law to cover proceeds of certain foreign
crimes.

Subtitle D—Reports and Miscellaneous
Sec. 1541. Study and report on reimbursing financial institutions and others for
providing financial records.
Sec. 1542. Reports of information regarding safety and soundness of depository
institutions.
Sec. 1543. Immunity.
Sec. 1544. Interagency information sharing.
Sec.
Sec.
Sec.
Sec.

1551.
1552.
1553.
1554.

Subtitle E—Counterfeit Deterrence
Short title.
Increase in penalties.
Deterrents to counterfeiting.
Reproductions of currency.

.

t

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3681

Subtitle F—^Miscellaneous Provisions
Sec. 1561. Civil monev penalties.
Sec. 1562. Authority to order depository institutions to obtain copies of CTRS from
customers which are unregulated businesses.
Sec. 1563. Whistleblower protection for employees of financial institutions other
than depository institutions.
Sec. 1564. Advisory eroup on reporting requirements.
Sec. 1565. GAO feasibility study of the financial crimes enforcement network.
TITLE XVI—TECHNICAL CORRECTIONS OF BANKING LAWS
Subtitle A—^Federal Deposit Insurance Corporation Improvement Act
Sec. 1601. Table of contents.
Sec. 1602. Transfer and redesignation of sections with duplicate section nimibers.
Sec. 1603. Technical corrections relating to title I of the Federal Deposit Insurance
Corporation Improvement Act of 1991.
Sec. 1604. Technical corrections relating to title II of the Federal Deposit Insurance
Corporation Improvement Act of 1991.
Sec. 1605. Technical corrections relating to tiUe III of the Federal Deposit Insurance Corporation Improvement Act of 1991.
Sec. 1606. Technical corrections relating to title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991.
Sec. 1607. Technical corrections relating to title V of the Federal Deposit Insurance
Corporation Improvement Act of 1991.
Sec. 1608. Federal Housing Finance Board practice required to conform to congressional intent and existing law.
Sec. 1609. Effective date.
Subtitle B—^Resolution Trust Corporation
Sec. 1611. Technical corrections relating to title I of the Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991.
Sec. 1612. Technical corrections relating to title II or the Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991.
Sec. 1613. Technical corrections relating to title III of the Resolution Trust
Corporation Refinancing, Restructuring, and Imwovement Act of 1991.
Sec. 1614. Techiucal corrections relating to title IV of the Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991.
Sec. 1615. Technical corrections relating to title V of the Resolution iSiist Corporation Refinancing, Restructuring, and Improvement Act of 1991.
Sec. 1616. Technical corrections relating to title VT of the Resolution Trust Corporation Refinancii^, Restmcturing, and Improvement Act of 1991.
Sec. 1617. R^eal of title consisting of amendments aupUcated in the Federal
Deposit Insurance Corporation Improvement Act of 1991.
Sec. 1618. Effective date.
SEC. 2. EFFECTIVE DATE.
42 USC 5301

The provisions of this Act and the amendments made by this
Act shall take effect and shall apply upon the date of the enactment
of this Act, unless such provisions or amendments specifically provide for effectiveness or applicabiUty upon another date certain.

TITLE I—HOUSING ASSISTANCE
Subtitle A—General Provisions
SEC. 101. LOW-INCOME HOUSING AUTHORIZATION.
(a) AGGREGATE BUDGET AUTHORITY.—Section

5(cX6) of the
United States Housing Act of 1937 (42 U.S.C. 1437c(cX6)) is
amended by adding at the end the following new sentence: 'The
ag^egate amount of budget authority that may be obligated for
assistance referred to in paragraph (7) is increased (to tiie extent
approved in appropriation Acts) by $14,710,990,520 on October
1,1992, and by $15,328,852,122 on October 1993.".
(b) UTILIZATION OF BUDGET AuTHORiry.—Section 5(cX7) of the
United States Housing Act of 1937 (42 U.S.C. 1437c(cX7)) is

106 STAT. 3682

PUBLIC LAW 102-550—OCT. 28, 1992

amended by striking the paragraph designation and all that follows
through the end of subparagraph (B) and inserting the following:
"(TXA) Using the additioncQ budget authority provided under
paragraph (6) and the balances of budget authority that become
available during fiscal year 1993, the Secretarv shall, to the extent
approved in appropriation Acts, reserve authority to enter into
obligations aggregating—
"(i) for public housing grants under subsection (aX2), not
more than $830,900,800, of which amount not more than
$257,320,000 shall be available for Indian housing;
"(ii) for assistance under section 8, not more than
$1,977,662,720, of which $20,000,000 shall be available for 15year contracts for project-based assistance to be used for a
multicultural tenant empowerment and homeownership project
located in the District of Columbia, except that assistance provided for such project shall not be considered for purposes
of the percentage limitations under section 8(iX2); except that
not more than 49 percent of any amounts appropriated under
this clause may be used for vouchers under section 8(o);
"(iii) for comprehensive improvement assistance grants
imder section 14(k), not more than $3,100,000,000;
"(iv) for assistance imder section 8 for property disposition,
not more than $93,032,000;
"(v) for assistance imder section 8 for loan management,
not more than $202,000,000;
''(vi) for extensions of contracts expiring under section 8,
not more than $6,746,135,000, which shall be for 5-year contracts for assistance under section 8 and for loan management
assistance under such section;
"(vii) for amendments to contracts under section 8, not
more than $1,350,000,000;
"(viii) for public housing lease adjustments and amendments, not more than $83,055,000;
"(ix) for conversions firom leased hoiising contracts under
section 23 of this Act (as in effect immecQately before the
enactment of the Housing and Community Development Act
of 1974) to assistance under section 8, not more than
$12,767,000; and
"(x) for grants under section 24 for revitalization of severely
distressed public housing, not more than $300,000,000.
"(B) Using the additional budget authority provided under paragraph (6) and the balances of budget authority that become available during fiscal year 1994, the Secretary shall, to the extent
approved in appropriation Acts, reserve authority to enter into
obligations aggregating—
"(i) for public housing grants under subsection (aX2), not
more than $865,798,634, of which amount not more than
$268,127,440 shall be available for Indian housing;
"(ii) for assistance imder section 8, not more than
$2,060,724,554, of which $20,000,000 shall be available for 15year contracts for project-based assistance to be used for a
multicultural tenant empowerment and homeownership project
located in the District or Columbia, except that assistance provided for such project shall not be considered for purposes
of the percentage limitations under section 8(iX2); except that
not more than 49 percent of any amounts appropriated under
tliis clause may be used for vouchers under section 8(6);

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3683

"(iii) for comprehensive improvement assistance grants
imder section 14(k), not more than $3,230,200,000;
''(iv) for assistance under section 8 for property disposition,
not more than $96,939,344;
"(v) for assistance imder section 8 for loan management,
not more than $210,484,000;
"(vi) for extensions of contracts expiring imder section 8,
not more than $7,029,472,670, which snail he for 5-year contracts for assistance wider section 8 and for loan management
assistance under such Election;
"(vii) for amendments to contracts imder section 8, not
more than $1,406,700,000;
"(viii) for public housing lease a4justments and amendments, not more than $86,543,310;
"(ix) for conversions from leased housing contracts under
section 23 of this Act (as in effect immediately before the
enactment of the Housing and Community Development Act
of 1974) to assistance under section 8, not more than
$13,303,214; and
"(x) for grants under section 24 for revitalization of severely
distressed public housing, not more than $312,600,000.".
SEC. 102. EXTENSION OF CEILING RENTS.
(a) REMOVAL OF 5-YEAR LIMIT.—Section 3(aX2XA) of the United

States Housing Act of 1937 (42 U.S.C. 1437a(aX2XA)) is amended
by striking "for not more than a 5-year period".
(b) EXTENSION OF PREVIOUS CEILING RENTS.—Section 3(aX2XB)
of the United States Housing Act of 1937 (42 U.S.C. 1437a(aX2XB))
is amended—
(1) by striking the first sentence; and
(2) in the last sentence, by striking "for the 5-year period
beginning on such date of enactment" and inserting "without
time limitation".
SEC. 103. DEFINITIONS OF INCOME AND ADJUSTED INCOME AND
APPUCABIUTYIX) INDIAN HOUSING PROGRAMS.
(a) IN GENERAL.—

(1) INCOME.—Section 3(bX4) of the United States Housing
Act of 1937 (42 U.S.C. 1437a(bX4)) is amended bv inserting
after "familv" the following: "and any amounts which would
be eligible for exclusion under section 1613(aX7) of the Social
Security Act (42 U.S.C. 1382b(aX7))".
(2) ADJUSTED INCOME.—Section 3(bX5) of the United States
Housing Act of 1937 (42 U.S.C. 1437a(bX5)) is amended—
(A) by striking subparagraph (D) and inserting the
following new subparagraph:
"(D) child care expenses to the extent necessary to
enable another member of the family to be employed or
to further his or he r education;";
(B) by striking "and" at the end of subparagraph (E);
(C) by striking the period at the end of^ subparagraph
(F) and inserting "; and"; and
(D) by inserting after subparagraph (F) the following
new subparagraph:
"(G) excessive travel expenses, not to exceed $25 per
family per week, for empro3rment- or education-related
travel, except that this subparagraph shall apply only to
families assisted by Indian housing authorities. .

106 STAT. 3684
42 u s e 1437a
note.

42 u s e 1437aa
note.

Regulations.
42 u s e 1437d
note.

PUBLIC LAW 102-550—OCT. 28, 1992
(3) BUDGET COMPLIANCE.—TO the extent that the amendments made by paragraphs (1) and (2) result in additional
costs under this title, sucn amendments shall be effective only
to the extent that amoimts to cover such additional costs are
provided in advance in appropriation Acts,
(b) APPUCABILITY OF DEFINITIONS TO INDIAN HOUSING.—

(1) IN GENERAL.—In accordance with section 201(bX2) of
the United States Housing Act of 1937 (42 U.S.C. 1437aa(bX2)),
the provisions of sections 572, 573, and 574 of the CranstonGonzalez National Affordable Housing Act shall apply to public
housing developed or oi)erated pursuant to a contract between
the S ^ e t a r y of Housing and Urban Development and an
Indi£Ui Housing Authority.
(2) EFFECTIVE DATE.—^Paragraph (1) shall take effect as
if such provision were enacted upon the date of the enactment
of the Cranston-Gonzalez National Affordable Housing Act.
SEC. 104. PUBUC AND SECTION 8 HOUSING TENANT PREFERENCE
RULES.

Not later than the expiration of the 180-day period beginning
on the date of the enactment of this Act, the Secretary of Housing
and Urban Development shall issue regulations implementing the
amendments made by sections 501 and 545 of the Cranston-Gonzalez National Affordable Housing Act. The regulations shall be
issued after notice and opportunity for public comment pursuant
to the provisions of section 553 of title 5, United States Code
(notwithstanding subsections (aX2), (bXB), and (dX3) of such section) and shall t£^e effect upon issuance.
SEC. 105. INCOME E U G I B I L I T Y FOR ASSISTED HOUSING.
(a) EXEMPTION FROM WAITING LIST REQUIREMENTS.—Section

16(c) of the United States Housing Act of 1937 (42 U.S.C. 1437n(c))
is amended—
(1) in the first sentence, by striking the second comma
and inserting "and";
(2) in the first sentence, by striking ", and shall" and
inserting ". In developing such admission procedures, the Secretary shall"; and
(3) by inserting before the period at the end of the penultimate sentence the following: ; except that such prohibition
shall not apply with respect to families selected for occupancy
in public housing imder the system of preferences established
by the agency pursuant to section 6(cX4XAXii)"(b)

EXEMPTION

FROM

EUGIBIUTY

RESTRICTIONS.—Section

16(dX2) of the United States Housing Act of 1937 (42 U.S.C.
1437n(dX2)) is amended by inserting before the period ", to scattered
site public housing dwelling units sold or intended to be sold to
public housing tenants under section 5(h) of this title.".
SEC. 106. FAMILY SELF-SUFFICIENCY PROGRAM.
(a) RESERVATION OF OPERATING SUBSIDIES.—The

last sentence
of section 23(hX2) of the United States Housing Act of 1937 (42
U.S.C. 1437u(hX2)) is amended to read as follows: ''Of any amounts
appropriated luider section 9(c) for fiscal year 1993, $25,000,000
is authorized to be used for costs under this paragraph, and of
any amounts appropriated under such section for fiscal year 1994,
$25,900,000 is authorized to be used for costs under this paragraph.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3685

(b) EXCEPTION TO REQUIRED ESTABLISHMENT OF PROGRAM.—

Section 23(bX2) of the United States Housing Act of 1937 (42
U.S.C. 1437u(bX2)) is amended by striking subparagraphs (A)
through (D) and inserting the following:
"(A) lack of supportive services accessible to eligible
families, which shall include insufficient availability of
resources for programs imder the Job Training Partnerships Act or the Job Opportunities and Basic Slalls Training Program under part F of title IV of the Social Security
Act;
"(B) lack of funding for reasonable administrative costs;
"(C) lack of cooperation by other units of State or
local government; or
"(D) any other circumstances that the Secretary may
consider appropriate.
In allocating assistance available for reservation under this
Act, the Secretary may not refuse to provide assistance or
decrease the amount of assistance that would otherwise be
provided to any public housing agency because the agency
has provided a certification under this paragraph or because,
pursuant to a certification, the agency has railed to carry out
a self-sufficiency progi-am.".
(c) NONPARTICIPATION.—Section 23(b) of the United States
Housing Act of 1937 (42 U.S.C. 1437u(b)) is amended by adding
at the end the following new paragraph:
"(4) NONPARTICIPATION.—^Assistance under the certificate
or voucher programs under section 8 for a family that elects
not to participate in a local program shall not be delayed
by reason of such election.".
(d) CONTRACT OF PARTICIPATION.—Section 23(cXl) of the United
States Housing Act of 1937 (42 U.S.C. 1437u(cXl)) is amended—
(1) in the second sentence, by inserting after "program"
the following: ", shall establish specific interim and final goals
by which compliance with and performance of the contract
may be measured,"; and
(2) by striking the last sentence and inserting the following
new sentences: ^ h e contract shall provide that the public
housing agency may terminate or withhold assistance under
section 8 and services under paragraph (2) of this subsection
if the public housing agency determines, through an administrative grievance procedure in accordance with the requirements
of section 6(k), that the family has failed to comply with the
requirements of the contract without good cause (which may
include a loss or reduction in access to supportive services,
or a change in circumstances that makes the family or individual unsuitable for participation).".
(e) SUPPORTIVE SERVICES.—^The first sentence of section 23(cX2)
of the United States Housing Act of 1937 (42 U.S.C. 1437u(cX2))
is amended by striking "to each participating family" the second
place it appears.
(f) ESCROW SAVINGS ACCOUNTS.—Section 23(dX2) of the United
States Housing Act of 1937 (42 U.S.C. 1437u(dX2)) is amended
in the last sentence by striking "only after" and all that follows
through the end of the sentence and inserting the following: "after
the family ceases to receive income assistance under Federal or
State welfare programs, upon successful performance of the obligations of the family imder the contract of participation entered

106 STAT. 3686

PUBLIC LAW 102-550—OCT. 28, 1992

into by the family under subsection (c), as determined according
to the specific goals and terms included in the contract, and under
other circumstances in which the Secretary determines an exception
for good cause is warranted. A public housing agency establishing
such escrow accounts may make certain amounts in the accounts
available to the participating families before full performance of
the contract obligations based on compliance with, and completion
of, specific interim goals included in the contract; except that any
such amounts shall be used by the participating famihes for purposes consistent with the contracts of participation, as determined
by the public housing agency.".
(g) INCENTIVES FOR PARTICIPATION.—Section 23(d) of the United
States Housing Act of 1937 (42 U.S.C. 1437u(d)) is amended—
(1) by striking the subsection designation and heading and
inserting the following:
"(d) INCENTIVES FOR PARTICIPATION.—"; and

(2) by adding at the end the following new paragraph:
"(3) PLAN.—Each public housing agency carrying out a
local program under this section shall establish a plan to offer
incentives to families to encourage families to participate in
the program. The plan shall require the establishment of escrow
savings accounts under paragraph (2) and may include any
other incentives designed by the public housing agency.",
(h) ACTION PLAN.—Section 23(gX3) of the United States Housing Act of 1937 (42 U.S.C. 1437u(gX3)) is amended—
(1) in subparagraph (F), by striking "and" at the end;
(2) in subparagraph (G), by striking the period at the
end and inserting "; and";
(3) by redesignating subparagraphs (D) through (G) (as
so amended) as subparagraphs (E) through (H), respectively;
(4) by inserting after subparagraph (C) the following new
subparagraph:
"(D) a description of the incentives pursuant to subsection (d) offered by the public housing agency to families
to encourage participation in the program;"; and
(5) by adding at the end the following new paragraph:
"(I) assurances satisfactory to the Secretary that
nonparticipating families will retain their rights to public
housing or section 8 assistance notwithstanding the provisions of this section.",
(i) DEFINITIONS.—Section 23(n) of the United States Housing
Act of 1937 (42 U.S.C. 1437u(n)) is amended—
(1) by redesignating paragraphs (3) and (4) as paragraphs
(4) and (5), respectively;
(2) by inserting after paragraph (2) the following new paragraph:
"(3) The term 'eligible family* means a family whose head
of household is not elderly, disabled, pregnant, a primary
caregiver for children under the age of 3, or for whom the
family self-sufRciency program would otherwise be unsuitable.
Notwithstanding the preceding sentence, a public housing
agency may enroll such families if they choose to participate
in the program."; and
(3) by adding at the end the following new paragraph:
"(6) The term Vacant unit' means a dwelling unit that
has been vacant for not less than 9 consecutive months.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3687

(j) I^fDIAN HOUSING.—Section 23(oX2) of the United States
Housing Act of 1937 (42 U.S.C. 1437u(oX2)) is amended to read
as follows:
"(2)

APPLICABILITY TO INDIAN PUBLIC HOUSING AUTHORI-

TIES.—Notwithstanding any other provision of law, the provisions of this section shall be optional for Indian housing
authorities.".

Subtitle B—Public and Indian Housing
SEC. 111. MAJOR RECONSTRUCTION OF OBSOLETE PROJECTS.
(a) I N GENERAL.—Section 5(jX2) of the United States Housing
Act of 1937 (42 U.S.C. 1437c(jX2)) is amended to read as follows:
"(2)(A) Notwithstanding any other provision of law, the Secretary may reserve not more than 20 percent of any amounts
appropriated for development of public housing in each fiscal year
for the substantial redesign, reconstruction, or redevelopment of
existing obsolete public housing projects or buildings and for the
costs of improving the management and operation of projects undergoing redesign, reconstruction, or redevelopment under this paragraph (to the extent that such improvement is necessary to maintain
the physical improvements resulting from such redesign, reconstruction, or redevelopment).
"(B) For purposes of this paragraph, the term 'obsolete public
housing project or building' means a public housing project or
building (i) having design or marketability problems resulting in
vacancy in more than 25 percent of the units, or (iiXD for which
the costs for redesign, reconstruction, or redevelopment (including
any costs for lead-based paint abatement activities) exceed 70 percent of the total development cost limits for new construction of
similar units in the area, and (II) which has an occupancy density
or a building height that is significantly in excess of that which
prevails in the neighborhood in which the project is located, a
bedroom configuration that could be altered to better serve the
needs of families seeking occupancy to dwellings of the public housing agency, significant security problems in and around the project,
or significant physical deterioration or inefficient energy and utility
systems.
"(C) The Secretary shall allocate amounts reserved under this
section to public housing agencies on the basis of a competition
among public housing agencies applying for such amounts. The
competition shall be based on—
"(i) the management capability of the public housing agency
to carry out the redesign, reconstruction, or redevelopment;
"(ii) the expected term of the useful life of the project
or building after redesign, reconstruction or redevelopment;
and
"(iii) the likelihood of achieving full occupancy within the
projects or buildings of the agency that are to be assisted
under this paragraph.
"(D) The Secretary shall establish limitations on the total costs
of any project or building receiving amounts under this paragraph
for redesign, reconstruction, and redevelopment. The cost limitations shall not be related to the total development cost system
for new development or to the cost limits for modernization and
shall recognize the higher direct costs of such work.

106 STAT. 3688

Reports.

PUBLIC LAW 102-550—OCT. 28, 1992

"(E) Assistance may not be provided under this paragraph
for any project or building assisted under section 14.
"(FXi) For each fiscal year for which amounts are reserved
or appropriated for the purposes of this paragraph, the Secretary
shall establish performance goals to evaluate the effectiveness of
the use of such amounts. The goals shall—
''(I) be designed to maximize the effectiveness of the
expenditures in a quantifiable manner; and
"(II) describe the number of imits to be redesigned, redeveloped, and reconstructed with such amounts and improvements
in the management of projects so assisted to be accomplished
with such amounts.
"(ii) Not later than 60 days after the end of each such fiscal
year, the Secretary shall submit a report to the Congress, which
shall describe the performance goals established for the fiscal year,
the activities carried out with such amounts, and a statement
of whether the performance goals were met. If the performance
goals were not met, the report shall contain—
"(I) an explanation of why the goals were not met and
a description of any managerial deficiencies or legal problems
that contributed to not meeting such goals;
"(II) plans and a schedule for achieving the level of performance under such performance goals;
"(III) recommendations for legislative or regulatory changes
necessary to achieve the performsmce goals or improve performance; and
"(IV) a statement of whether the performance goals established for the fiscal year were impractical or infeasible, and,
if so, the factors that contributed and resulted in establishing
such impractical or infeasible goals and recommendations of
actions to meet such goals, which may include changing the
goals or altering or eliminating the program under this paragraph for major reconstruction of projects.",
(b) MODERNIZATION AND DISPOSITION REQUIREMENTS.—

42 use 1437/.

(1) MODERNIZATION.—Section 14(c) of the United States
Housmg Act of 1937 (42 U.S.C. 14371(c)) is amended—
(A) in the matter preceding paragraph (1)—
(i) by inserting "buildings of after "for"; and
(ii) by striking "which";
(B) in each of paragraphs (1), (2), (3), and (4), by
inserting "which projects" after the paragraph designation;
(C) in paragraph (3), by striking "and" at the end;
(D) by redesignating paragraph (4) as paragraph (5);
and
(E) by inserting after paragraph (3) the following new
paragraph:
"(4) which buildings are not assisted under section 5(jX2);
and".
(2) DEMOLITION AND DISPOSITION.—Section 18(a)

42 use I437p.

of

the

United States Housing Act of 1937 (42 U.S.C. 1437q(a)) is
amended—
(A) in paragraph (1), by striking "or" at the end;
(B) in paragraph (2), by striking the period at the
end and inserting "; or"; and
(C) by adding at the end the following new paragraph:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3689

"(3) in the case of an application proposing demolition
or disposition of any portion of a public housing project, assisted
at any time under section 5(jX2)—
"(A) such assistance has not been provided for the
portion of the proiect to be demolished or disposed within
the 10-year perioa ending upon submission of the application; or
''(B) the property's retention is not in the best interest
of the tenant£i or the public housing agency because of
extraordinary changes in the area surrounding the project
or other extraordinanr circiunstances of the project.".
(c) REGULATIONS.—^The Secretary shall issue regulations necessary to carry out the amendments made by this section as provided under section 191 of this Act.
SEC. 112. PUBUC HOUSING TENANT PREFERENCES.

Section 6(cX4XAXi) of the United States Housing Act of 1937
(42 U.S.C. 1437d(cX4XAXi)) is amended by striking "70 percent"
and inserting "50 percent".
SEC. 113. REFORM OF PUBUC HOUSING MANAGEMENT.
(a) INDEPENDENT :MANAGEMENT ASSESSMENT.—Section 6(iX2)

of the United States Housing Act of 1937 (42 U.S.C. 1437d(jX2))
is amended—
(1) by redesignating subparagraph (B) as subparagraph
(C);
(2) by inserting after subparagraph (A) the following new
subparagraph:
"(BXi) Upon designating a public housing agency as troubled
pursuant to subparagraph (A) and determining that an assessment
under this subparagraph will not duplicate any review conducted
under section 14(p), tne Secretary shall provide for an on-site,
independent assessment of the management of the agency.
"(ii) To the extent the Secretary deems appropriate (taking
into accoimt an agenc^s performance under the mdicators specified
under paragraph (1)), the assessment team shall also consider issues
relating to the agenc3r's resident population and physical inventory,
including the extent to which (I) the agency's comprehensive plan
prepared pursuant to section 14 adequately and appropriately
addresses the rehabilitation needs of the agencjr's inventory, (II)
residents of the agency are involved in and informed of significant
management decisions, and (III) any projects in the agency s inventory are severely distressed and eligible for assistance pursuant
to section 24.
"(iii) An independent assessment under this subparagraph shall
be carried out by a team of knowledgeable individuals selected
by the Secretary (referred to in this section as the 'assessment
team') with expertise in public housing and real estate management.
In conducting an assessment, the assessment team shall consult
with the residents and with public and private entities in the
jurisdiction in which the public housing is located. The assessment Repots.
team shall provide to the Secretary and the public housing agency
a written report, which shall contain, at a minimum, recommendations for such management improvements as are necessary to eliminate or substantially remedy existing deficiencies."; and
(3) in subparagraph (C), as so redesignated by paragraph
(1)-

106 STAT. 3690

PUBLIC LAW 102-550—OCT. 28, 1992

(A) by striking "agency setting forth" and inserting
the following: "agency, after reviewing the report submitted
pursuant to subparagraph (B) and consulting with the
agency's assessment team. Such agreement shall set forth";
and
(B) bv inserting before the second sentence the following new flush sentence:
"To the extent the Secretary deems appropriate (taking into account
an agency's performance under the indicators specified under paragraph (1)), such agreement shall also set forth a plan for enhancing
resident involvement in the management of the public housing
agency.".
(b) ADDITIONAL STATUTORY REMEDIES.—Section 6(jX3XA) of the
United States Housing Act of 1937 (42 U.S.C. 1437d(jX3XA)) is
amended—
(1) in clause (i), by inserting after "agents" the first place
it appears the following: "(which may be selected by existing
tenants through administrative procedures established by the
Secretary)";
(2) at the end of clause (ii), by striking "and";
(3) by redesignating clause (iii) as clause (iv);
(4) by inserting after clause (ii) the following new clause:
"(iii) solicit competitive proposals from other public housing
agencies and private entities with experience in construction
management in the eventuality that such agencies or firms
may be needed to oversee implementation of assistance made
available under section 14 for the housing; and"; and
(5) by adding at the end the following new flush sentence:
"Residents of a public housing agency designated as troubled pursuant to paragraph (2XA) may petition the Secretary in writing to
take 1 or more of the actions referred to in this subparagraph.
The Secretary shall respond to such petitions in a timely manner
with a written description of the actions, if any, the Secretary
plans to take and, where applicable, the reasons why such actions
differ from the course proposed by the residents.".
(c) RESOURCES.—Section 6(jX3) of the United States Housing
Act of 1937 (42 U.S.C. 1437d(jX3)) is amended—
(1) by redesignating subparagraphs (B) and (C) as subparagraphs (C) and (D), respectively; and
(2) by inserting auer subparagraph (A) the following new
subparagraph:
"(B) The Secretary may make available to receivers and other
entities selected or appointed pursuant to this paragraph such
assistance as is necessary to remedy the substantial deterioration
of living conditions in individual public housing developments or
other related emergencies that endanger the health, safety and
welfare of the residents.".
(d) ANNUAL REPORTS.—Section 6(jX5XE) of the United States
Housing Act of 1937 (42 U.S.C. 1437d(jX4XE)), as so redesignated
by subsection (dXD, is amended by inserting before the semicolon
the following: ", including an accounting of the authorized funds
that have been expended to support such actions".
(e) APPLICABILITY.—
(1) ASSESSMENT OF RESIDENT MANAGEMENT CORPORA-

TIONS.—Section 6(jXl) of the United States Housing Act of
1937 (42 U.S.C. 1437d(jXl)) is amended—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3691

(A) in the first sentence, by inserting "and resident
man^ement corporations" before the period;
(B) in the third sentence, by inserting "and resident
management corporations" after "agencies"; and
(C) in the fourth sentence, by striking "indicators."
and inserting "indicators for pubhc housing agencies, to
the extent practicable:".
(2) PROCEDURES.—Section 6(jX2) of the United States Housing Act of 1937, as amended by subsection (a) of this section,
is further amended by adding at the end the following new
subparagraph:
"(D) The Secretary shall apply the provisions of this
paragraph to resident management corporations as well
as public housing agencies.".
SEC. 114. PUBUC HOUSING OPERATING SUBSIDIES.
(a) AUTHORIZATION OF APPROPRIATIONS.—Section 9(c) of

the

United States Housing Act of 1937 (42 U.S.C. 1437g(c)) is amended
to read as follows:
"(cXD There are authorized to be appropriated for purposes
of providing annual contributions under this section $2,282,436,000
for fiscal year 1993 and $2,378,298,312 for fiscal year 1994.
"(2) There are also authorized to be appropriated to provide
annual contributions under this section, in addition to amounts
under paragraph (1), such stuns as may be necessary for each
of fiscal years 1993 and 1994, to provide each public housing agency
with the difference between (A) the amount provided to the agency
from amounts appropriated pursuant to paragraph (1), and (B)
all funds for which the agency is eligible under the performance
funding system without ac^ustments for estimated or unrealized
savings.
"(3) In addition to amounts under paragraphs (1) and (2),
there are authorized to be appropriated for annual contributions
under this section to provide for the costs of the adjustments to
income and adjusted income under the amendments made by sections 573(b) and (c) of the Cranston-Gonzalez National Affordable
Housing Act such sums as may be necessary for fiscal years 1993
and 1994.".
(b) ADJUSTMENT OF PERFORMANCE FUNDING SYSTEM.—Section

9(aX3XA) of the United States Housing Act of 1937 (42 U.S.C.
1437g(aX3XA)) is amended by inserting after the period at the
end the following new sentence: "Notwithstanding sections 583(a)
and 585(a) of title 5, United States Code (as added by section
3(a) of the Negotiated Rulemaking Act of 1990), any proposed
regulation providing for amendment, alteration, ac^ustment, or
other change to the performance funding system relating to vacant
public housing units shall be issued pursuant to a negotiated rulemaking procedure under subchapter IV of chapter 5 of such title
(as added by section 3(a) of the Negotiated Rulemaking Act of
1990), and tne Secretary shall establish a negotiated rulemaking
committee for development of any such proposed regulations.".
(c) ENERGY SAVINGS.—Section 9(aX3XBXi) of the United States
Housing Act of 1937 is amended by inserting before the semicolon
at the end the following: ", and in subsequent years, if the energy
savings are cost-effective, the Secretary may continue the sharing
arrangement with the public housing agency for a period not to
exceed 6 years".

106 STAT. 3692

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 116. PUBUC HOUSING VACANCY SEDUCTION.

42 use 1437/.

(a) FUNDING.—Section 14(pX5) of the United States Housing
Act of 1937 (42 U.S.C. 14371(pX5)) is amended to read as foUows:
"(SXA) Of any amounts available under this section in each
of fiscal years 1993 and 1994 (after amounts are reserved pursuant
to subsection (kXl)), an amount equal to 4 percent of such remaining
fiinds shall be available in each such fiscal year for the purposes
under subparagraph (B).
"(B) Of such amounts available under subparagraph (A) in
each suchfiscalyear—
"(i) 20 percent shall be available only for canying out
activities under section 6Q); and
"(ii) 80 percent shall be available for carrying out this
subsection.".
(b) SCOPE OF PROGRAM.—Section 14(pXl) of the United States
Housing Act of 1937 (42 U.S.C. 14371(pXl)) is amended—
(1) by striking "or that" and inserting ", that"; and
(2) by inserting afi«r "6(j)," the following: "or for which
a receiver has been appointed pursuant to section 6(jX3),".
(c) VACANCY REDUCTION ASSISTANCE.—Section 14(pX4) of the
United States Housing Act of 1937 (42 U.S.C. 14371(pX4)) is
amended—
(1) in subparagraph (B), by inserting before the semicolon
the following: ", except that the Secretary may provide assistance to a public housing agency designated as a troubled agency
for the purposes under this subparagraph only if the Secretary
determines that the agency is making substantial progress
in remedying management deficiencies, if any, or that the
agency has provided reasonable assurances that such progress
will be made"; and
(2) in subparagraph (C), by inserting before the semicolon
the following: ", except that the Secretary may provide assistance to a public housing agency designated as a troubled agency
for the purposes under this subparagraph only if the Secretary
determines that the agency is mcJdng substantial progress
in remedying management deficiencies, if any, or that the
agency has provided reasonable assiurances that such progress
will be made".
(d) AVAILABILITY OF ASSISTANCE.—Section 14(pX4) of the United
States Housing Act of 1937 (42 U.S.C. 14371(pX4)) is amended
by striking the first comma and all that follows through the second
comma and inserting ", subject to the availability of amoimts imder
paragraph (6),".
(e) USE OF AMOUNTS FOR ASSESSMENT TEAMS.—Section 14(pX3)
of the United States Housing Act of 1937 (42 U.S.C. 14371(pX3))
is amended by adding at the end the following new subparagraph:
"(D) The Secretary may use amoimts made available under
paragraph (6) for any travel and administrative expenses of assessment teams under this paragraph.".
(f) ASSESSMENT TEAM.—^The second sentence of section
14(pX3XA) of the United States Housing Act of 1937 (42 U.S.C.
14371(pX3XA)) is amended—
(1) by striking "and" afi;er "Development" and inserting
a comma; and
(2) by striking "who" and inserting "and officials of the
public housing agency, all of whom".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3693

(g) RESERVATION OF ANNUAL CONTRTOUTIONS FOR AcTivmES
UNDER PLAN.—Section 14(p) of the United States Housing Act
of 1937 (42 U.S.C. 14371(p)) is amended—
(1) by redesignating paragraphs (3), (4), and (5) (as
amended by the preceding provisions of this section) as paragraphs (4), (5), and (6), respectively; and
(2) l3y inserting after paragraph (2) the following new paragraph:
"(3XA) Upon the expiration of the 24-month period beginning
upon the receipt of assistance under paragraph (5) by a public
housing agency, the Secretaiv shall, after reviewing the progress
made in complying with the plan, reserve from the annual contribution attributable to each unit vacant for the 24-month period an
amount determined by the Secretary but not exceeding 80 percent
of such contribution. The Secretary may not reserve any amounts
under this subparagraph for any vacant dwelling unit that is vacant
because of modernization, reconstruction, or leaa-based paint reduction activities.
"(B) The Secretary shall deposit any amounts reserved under
subparagraph (A) in a separate account established on behalf of
the public Housing agency, and such amounts shall be available
to the agency only for the purpose of carrying out activities in
compliance with the vacancy reduction plan of the agency.
"(C) If, after the expiration of the 24-month period beginning
upon the reservation under subparagraph (A) oi amounts for a
public housing agency, the Secretary determines that the agency
nas not made significant progress to comply with the provisions
of the vacancy reduction plan of the agency, the amount remaining
in the account for the agency established under subparagraph (B)
shall be recaptured by the Secretary.".
(h) TECHNICAL CORRECTIONS.—Section 14(pX2) of the United

States Housing Act of 1937 (42 U.S.C. 14371(pX2)) is amended—
(1) in clause (D), by striking "modernization, reconstruction" and inserting "comprehensive modernization, msgor
reconstruction"; and
(2) in clause (E), by striking "the modernization" and inserting "the comprehensive modernization".
SEC. 116. PUBUC HOUSING DEMOLITION AND DISPOSITION.
(a) COORDINATION WITH TENANTS.—Section 18(bXl) of the

United States Housing Act of 1937 (42 U.S.C. 1437p(bXl)) is amended by inserting "of uie project or portion of the project covered
by the application" after "tenant cooperative".
(b) REPLACEMENT PLAN.—Section 18(bX3) of the United States

Housing Act of 1937 (42 U.S.C. 1437p(bX3)) is amended—
(1) in subparagraph (A)—
(A) in clause (ii), by inserting before the semicolon
at the end the following: "to the extent available; or if
such assistence is not available, in the case of an application proposing demolition or (tisposition of 200 or more
units, the use of available project-based assistance under
section 8 having a term of not less than 5 years";
(B) in clause (iii), by inserting before the semicolon
at the end the following: "to the extent available; or if
such assistence is not available, in the case of an application proposing demolition or (Usposition of 200 or more
imite, the use of available project-based assistance under

106 STAT. 3694

PUBLIC LAW 102-550—OCT. 28, 1992
other Federal programs having a term of not less than
5 years"; and
(C) in clause (v), by inserting before the semicolon
the following: "to the extent available; or if such assistance
is not avEiilable, in the case of an application proposing
demolition or disposition of 200 or more units, the use
of tenant-based assistance under section 8 (excluding
vouchers under section 8(o)) having a term of not less
than 5 years";
(2) in subparagraph (G), by striking the period at the
end and inserting a semicolon;
(3) by redesignating subparagraphs (B) through (G) as subparagraphs (C) through (H), respectively;
(4) by inserting after subparagraph (A) the following new
subparagraph:
"(B) in the case of an application proposing demolition
or disposition of 200 or more units, shall provide that
(notwithstanding the limitation imder section 8(dX2XA) on
the amount of project-based assistance provided by an
agency)—
"(i) not less than 50 percent of such additional
dwelling units shall be provided through the acquisition or development of additional public housing dwelling units or through project-based assistance; and
"(ii) not more than 50 percent of such additional
dwelling units shall be provided through tenant-based
assistance under section 8 (excluding vouchers under
section 8(o)) having a term of not less than 5 years;";
and
(5) by adding at the end the following new flush matter:
"except that, in any 5-year period, a public housing agency
may demolish not more than the lesser of 5 dwelling units
or 5 percent of the total dwelling units owned and operated
by the public housing agency, without providing an additional
dwelling unit for each such public housing dwelling luiit to
be demolished, but only if the space occupied by the demolished
unit is used for meeting the service or other needs of public
housing residents.".
(c) SET-ASIDES FOR REPLACEMENT HOUSING.—Section 18 of the

United States Housing Act of 1937 (42 U.S.C. 1437p) is amended—
(1) by redesignating subsection (e) as subsection (f); and
(2) by inserting after subsection (d) the following new subsection:
"(eXD In each of fiscal years 1993 and 1994, the Secretary
may reserve from any budget authority appropriated for such year
for assistance under section 8 that is available for families not
currently receiving such assistance not more than 10 percent of
such budget authority for providing replacement housing under
subsection (bX3XA) for units demolished or disposed of pursuant
to this section.
"(2) In each of fiscal years 1993 and 1994, the Secretary may
reserve from any budget authority appropriated for such year for
development of public housing under section 5(aX2) not more than
the lesser of 30 percent of such budget authorization or
$150,000,000, for providing replacement housing under subsection
(bX3)(A) for units demolished or disposed of pursuant to this
section.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3695

(d) YOLO COUNTY HOUSING AUTHORITY.—The Secretary of

Housing and Urban Development shall approve the application
for disposition by the Yolo County Housing Authority (CA30-PO003 and CA30-PO44-099), provided that the application states
that the tenant councils, resident management corporation, and
tenant cooperative, if any, shall be given appropriate opportunities
to purchase the new replacement imits, which shall be available
and ready for occupancy before the disposition of the existing subject
units. The new units shall be considered public housing for the
purposes of the United States Housing Act of 1937 for which the
Secretary shall provide annual contributions for operation using
any amounts made available under section 9(c).
SEC. 117. PUBLIC HOUSING RESIDENT MANAGEMENT.

Section 20(f)(3) of the United States Housing Act of 1937 (42
U.S.C. 1437r(fK3)) is amended to read as follows:
"(3)

AUTHORIZATION

O F APPROPRIATIONS.—There

are

authorized to be appropriated to carry out this subsection
$4,750,000 for fiscal year 1993 and $4,949,500 for fiscal year
1994.".
SEC. 118. PUBUC HOUSING HOMEOWNERSHIP.
(a) HOMEOWNERSHIP ASSISTANCE,—Section 21(a)(2)(C) of the
United States Housing Act of 1937 (42 U.S.C. 1437s(a)(2XC)) is
amended—
(1) in the first sentence, by striking "the effective date
of the regulations implementing title III of this Act" and inserting "February 4, 1991"; and
(2) in the second sentence—
(A) by striking "effective"; and
(B) by striking "such Act" and inserting "the CranstonGonzalez National Affordable Housing Act".
(b) CONDITIONS

O F PURCHASE.—Section

21(aX3XC) of

the

United States Housing Act of 1937 (42 U.S.C. 1437s(aX3XC)) is
amended—
(1) in the first sentence, by striking "the effective date
of the regulations implementing title III of this Act" and inserting "February 4,1991"; and
(2) in the second sentence—
(A) by striking "effective"; and
(B) by striking "such title" and inserting "the CranstonGonzalez National Affordable Housing Act".
SEC. 119. PUBLIC HOUSING FAMILY INVESTMENT CENTERS.

Section 22(k) of the United States Housing Act of 1937 (42
U.S.C. 1437t(k)) is amended to read as follows:
"(k) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to carry out this section $25,000,000 for fiscal
year 1993 and $26,050,000 for fiscal year 1994.".
SEC. 120. REVITALIZATION OF SEVERELY DISTRESSED PUBUC HOUSING.

Title I of the United States Housing Act of 1937 (42 U.S.C.
1437 et seq.) is amended by adding a t the end the following new
section:

106 STAT. 3696
42 u s e 1437v.

PUBLIC LAW 102-550—OCT. 28, 1992

«<SEC. 24. REVTTALIZATION OF SEVERELY DISTRESSED PUBLIC HOUSING.

"(a) PROGRAM AUTHORITY.—The Secretary may make—
"(1) planning grants under subsection (c) to enable
applicants to develop revitalization programs for severely distressed public housmg in accordance with this section; and
"(2) implementation grants under subsection (d) to carry
out revitalization programs for severely distressed public housing in accordance with this section.
"(b) DESIGNATION OF ELIGIBLE PROJECTS.—

"(1) IDENTIFICATION.—Not later than 90 days after the
date of enactment of the Housing and Community Development
Act of 1992, public housing agencies shall identify, in such
form and manner as the S^retary may prescribe, any public
housing projects that they consider to be severely distressed
public housing for purposes of receiving assistance imder this
section.
"(2) REVIEW BY SECRETARY.—The Secretary shall review
the projects identified pursuant to paragraph (1) to ascertain
whether the projects are severely distressed housing (as such
item is defined in subsection (n)). Not later than 180 days
after the date of enactment of this section, the Secretary shall
publish a list of those projects that the Secretary determines
are severely distressed public housing.
"(3) APPEAL OF SECRETARY'S DETERMINATION.—^The Secretary shall establish procedures for public housing agencies
to appeal the Secretar}r's determination that a project identified
by a public housing agency is not severely distressed.
"(c) PLANNING GRANTS.—

"(1) I N GENERAL.—The Secretary may make plginning
grants under this subsection to applicants for the purpose of
developing revitalization programs for severely distressed public housing under this section.
"(2) AMOUNT.—The amount of a planning grant under this
subsection may not exceed $200,000 per project, except that
the Secretary may for good cause approve a grant in a higher
amount.
"(3) EuGiBLE ACTIVITIES.—A planning grant may be used
for activities to develop revitalization progrEims for severely
distressed public housing, including—
"(A) studies of the different options for revitalization,
including the feasibility, costs and neighborhood impact
of such options;
"(B) providing technical or organizational support to
ensure resident involvement in all phases of the planning
and implementation processes;
"(C) improvements to stabilize the development, including security investments;
"(D) conducting workshops to ascertain the attitudes
and concerns of the neighboring community;
"(E) preliminary architectural and engineering work;
"(F) planning for economic development, job training
and self-sufficiency activities that promote the economic
self-sufficiency of residents under the revitalization
program;
"(G) designing a suitable replacement housing plan,
in situations where partial or total demolition is considered;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3697

"(H) planning for necessary management improvements; and
"(I) preparation of an application for an implementation
grant imder this section.
''(4) APPLICATIONS.—^An application for a planning grant
shall be submitted in such form and in accordance with such
procedures as the Secretary shall establish. The Secretary shall
require that an application contain at a minimum—
''(A) a request for a planning grant, specifying the
activities proposed, the schedule for completing the activities, the personnel necessary to complete the activities
and the amount of the grant requested;
''(B) a description of the applicant and a statement
of its qualifications;
"(C) identification and description of the project
involved, and a description of the composition of the tenants, including family size and income;
"(D) a certification by the public official responsible
for submitting the comprehensive housing affordability
strategy under section 105 of the Cranston-Gronzalez
National Affordable Housing Act that the proposed activities are consistent with the approved housing strategy of
the State or unit of general local government within which
the project is located; and
"(E) a certification that the applicant will comply with
the requirements of the Fair Housing Act, title \ ^ of the
Civil Rights Act of 1964, section 504 of the Rehabilitation
Act of 1973, and the Age Discrimination Act of 1975, and
will affirmatively further fair housing.
"(5) SELECTION CRITERIA.—The Secretary shall, by regula- Regulations.
tion, establish selection criteria for a national competition for
assistance under this subsection, which shall include—
"(A) the qualities or potential capabilities of the
applicant;
"(B) the extent of resident interest and involvement
in the development of a revitalization program for the
project;
"(C) the extent of involvement of local public and private entities in the development of a revitalization program
for the project and in the provision of supportive services
to project residents;
"(D) the potential of the applicant for developing a
successful and affordable revitalization program and the
suitability of the project for such a program;
"(E) national geographic diversity among housing for
which applicants are selected to receive assistance;
"(F) the extent of the need for and potential impact
of the revitalization program; and
"(G) such other factors that the Secretary determines
are appropriate for purposes of carrying out the program
established by this section in an effective and efficient
manner.
"(6) NOTIFICATION.—The Secretary shall notify each
applicant, not later than 6 months after the date of the submission of the application, whether the application is approved
or disapproved.
"(d) IMPLEMENTATION GRANTS.—

106 STAT. 3698

PUBLIC LAW 102-550—OCT. 28, 1992
"(1) IN GENERAL.—^The Secretary may make implementation grants iinder this subsection to applicants for the piirpose
of canying out revitalization programs for severely distressed
public housing imder this section.
"(2) ELIGIBLE ACTIVITIES.—Implementation grants may be

Regulations.

used for activities to carry out revitalization programs for
severely distressed public housing, including—
"(A) architectural and engineering work;
"(B) the redesign, reconstruction, or redevelopment of
the severely distressed public housing development, including the site on which the development is located;
"(C) covering the administrative costs of the applicant,
which may not exceed such portion of the assistance provided under this subsection as the Secretary may prescribe;
"(D) any necessary temporary relocation of tenants during the activity specified under subparagraph (B);
"(E) pajrment of legal fees;
"(F) economic development activities that promote the
economic self-sufficiency of residents under the revitalization program;
"(G) necessary management improvements;
"(H) transitional security activities; and
"(I) any necessary support services, except that not
more than 15 percent of any grant under this subsection
may be used for such purpose.
"(3) APPLICATION.—^/oi application for a implementation
grant shall be submitted by an applicant in such form and
in accordance with such procedures as the Secretary shall establish. The Secretary shall require that an application contain
at a minimum—
"(A) a request for an implementation grant, specifying
the amount of the grant requested and its proposed uses;
"(B) a description of the applicant and a statement
of its qualifications;
"(C) identification and description of the project
involved, and a description of the composition of the tenants, including family size and income;
"(D) a certification by the public official responsible
for submitting the comprehensive housing affordability
strategy under section 105 of the Cranston-Conzalez
National Affordable Housing Act that the proposed activities are consistent with the approved housing strategy of
the State or unit of general local government within which
the project is located; and
"(E) a certification that the applicant will comply vdth
the requirements of the Fair Housing Act, title VI of the
Civil Rights Act of 1964, section 504 of the Rehabilitation
Act of 1973, and the Age Discrimination Act of 1975, and
will affirmatively further fair housing.
"(4) SELECTION CRITERIA.—^The Secretary shall, by regulation, establish selection criteria for a national competition for
assistance under this subsection, which shall include—
"(A) the qualities or potential capabilities of the
applicant;
"(B) the extent of resident involvement in the development of a revitalization program for the project;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3699

"(C) the extent of involvement of local public and private entities in the development of a revitalization program
for the project and in the provision of supportive services
to project residents;
"(D) the potential of the applicant for developing a
successful ana affordable revitalization program and the
suitability of the project for such a program;
"(E) national geographic diversity among housing for
which applicants are selected to receive assistance;
"(F) the extent of the need for and potential impact
of the revitalization program; and
"(G) such other factors that the Secretary determines
are appropriate for purposes of carrying out the program
established by this subtitle in an effective and efficient
manner.
"(5) NOTIFICATION.—The Secretary shall notify each
applicant, not later than 6 months after the date of the submission of the application, whether the application is approved
or disapproved.
"(e) EXCEPTIONS TO GENERAL PROGRAM REQUIREMENTS.—
"(1) LONG-TERM VIABILITY.—The Secretary may waive or

revise rules established under this title governing rents, income
eligibility, and other areas of public housing management, to
permit a public housing agency to undertake measures that
enhance the long-term viability of a severely distressed public
housing project revitalized under this section.
"(2) SELECTION OF TENANTS.—For projects revitalized under
this section, a public housing agency may select tenants pursuant to a local system of preferences, in lieu of selecting tenants
pursuant to the preferences specified imder section 6(cX4XAXi).
Such local system shall be established in writing and shall
respond to local housing needs and priorities as determined
by the public housing agency. The public housing agency shall
hold 1 or more public hearings to obtain the views of lowincome tenants and other interested parties on the housing
needs and priorities of the agency's jurisdiction.
"(f) OTHER PROGRAM REQUIREMENTS.—
"(1) COST LIMITATIONS.—Subject to the provisions of this

section, the Secretary—
"(A) shall establish cost limitations on eligible activities
under this section sufficient to provide for effective revitalization programs; and
"(B) may establish other cost limitations on eligible
activities under this section.
"(2) ECONOMIC DEVELOPMENT.—Not more than an aggregate of $250,000 from amounts made available under subsections (c) and (d) may be used for economic development
activities under subsections (c) smd (d) for any project, except
that the Secretary may for good cause waive the applicability
of this paragraph for a project.
"(g) ADMINISTRATION.—For the purpose of canying out the
revitalization of severely distressed public housing in accordance
with this section, the Secretary shall establish within the Department of Housing and Urban Development an Office of Severely
Distressed Public Housing Revitalization.
"(h) DEFINITIONS.—For the purposes of this section:
"(1) APPLICANT,—^The term 'applicant' means—

106 STAT. 3700

PUBLIC LAW 102-550—OCT. 28, 1992
"(A) any public housing agency that is not designated
as troubled pursuant to section 6(jX2);
"(B) any public housing agency or private housing
management agent selected, or receiver appointed pursuant, to section 6(j)(3);
"(C) any public housing agency that is designated as
troubled pursuant to section 6(j)(2), if such agency acts
in concert with a private nonprofit organization, another
public housing agency that is not designated as a troubled
agency, resident management corporation or other entity
approved by the Secretary; and
"(D) any public housing agency that is designated as
troubled pursuant to section 6(jX2) that—
"(i) is so designated principally for reasons that
will not affect the capacity of the agency to carry
out a revitalization program;
"(ii) is making substantial progress toward
eliminating the deficiencies of the agency; or
"(iii) is otherwise determined by the Secretary to
be capable of carrying out a revitalization program.
"(2) PRIVATE NONPROFIT coRPORATiON.^The term 'private
nonprofit organization' means any private nonprofit organization (including a State or locally chartered nonprofit organization) that—
"(A) is incorporated under State or local law;
"(B) has no part of its net earnings inuring to the
benefit of any member, founder, contributor, or individual;
"(C) complies with standards of financial accountability
acceptable to the Secretary; and
"(D) has among its purposes significant activities
related to the provision of decent housing that is affordable
to very low-income families.
"(3) PUBLIC HOUSING AGENCY.—The term 'public housing
a g e n c / h a s the meaning given the term in section 3(b), except
that it does not include any Indian housing authority.
"(4) RESIDENT MANAGEMENT CORPORATION.—The term 'resident management corporation' means a resident management
corporation established in accordance with the requirements
of the Secretary under section 20.
"(5) SEVERELY DISTRESSED PUBLIC HOUSING.—The term
'severely distressed public housing* means a public housing
project—
"(A)thalr"(i) requires major redesign, reconstruction or
redevelopment, or partial or total demolition, to correct
serious deficiencies in the original design (including
appropriately high population density), deferred
maintenance, physical deterioration or obsolescence of
major systems and other deficiencies in the physical
plant of the project;
"(ii) is occupied predominantly by families with
children who are in a severe state of distress,
characterized by such factors as high rates of
unemployment, teenage pregnancy, single-parent
households, long-term dependency on public assistance
and minimal educational achievement;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3701

"(iii) is in a location for recurrent vandalism and
criminal activity (including drug-related criminal activity); and
"(iv) cannot remedy the elements of distress specified in clauses (i) through (iii) through assistance under
other programs, such as the programs under section
9 or 14, or through other amninistrative means; or
"(B) that—
"(i) is owned by a public housing agency designated
as troubled pursuant to section 6(jX2);
**(ii) has a vacancy rate, as determined by the
Secretary, of 50 percent or more, unless the project
or building is vacant because it is awaiting rehabilitation under a modernization program under section 14
that^
"(1) has been approved and funded; and
"(II) as determined by the Secretary, is on
schedule and is expected to result in full occupancy
of the project or building upon completion of the
program; and
(iii) in the case of individual buildings, the building is, in the Secretary's determination, sufficiently
separable from the remainder of the project to make
use of the building feasible for purposes of this subtitle,
"(i) ANNUAL REPORT.—The Secretary shall submit to the Congress an annual report setting forth—
"(1) the number, type, and cost of public housing units
revitalized pursuant to this section;
"(2) the stetus of projects identified as severely distressed
public housing pursuant to subsection (b);
"(3) the amount and type of financial assistance provided
under and in conjunction with this section; and
"(4) the recommendations of the Secretory for statutory
and regulatory improvemento to the program estoblished by
this section.".
SEC. 121. CHOICE IN PUBUC HOUSING MANAGEMENT.

(a) PURPOSE.—^The purpose of this section is to encourage choice 42 u s e 1437w
in management of distressed public housing projects by residents note.
and increased resident management of public housing projecto, as
a means of improving living conditions in public housing projects,
by providing for resident councils and resident management corporations to transfer the management of distressed projects to
alternative managers.
(b) AMENDMENT TO 1937 ACT.—Title I of the United Stetes
Housing Act of 1937 (42 U.S.C. 1437 et seq.) is amended by adding
after section 24 (as added by section 120 of this Act) the following
new section:
•«EC. 25. CHOICE IN PUBUC HOUSING MANAGEMENT.
"(a) SHORT TITLE.—^This section may be cited

in Public Housing Management Act of 1992'.

Choice in Public
Housing

as the 'Choice Management

"(b) FUNDING.—
"(1) REHABILITATION AND REDEVELOPMENT GRANTS.—From

amounts reserved under section 14(kX2) for each of fiscal years
1993 and 1994, Uie Secretary may reserve not more than
$50,000,000 in each such fiscal year for activities under this
section (which may include funding operating reserves for

Act of 1992.
42 u s e 1437w.

106 STAT. 3702

PUBLIC LAW 102-550—OCT. 28, 1992
eligible housing transferred under this section). The Secretary
may make grants to managers and ownership entities to
rehabilitate eligible housing in accordance with this section,
as appropriate.
"(2) TECHNICAL ASSISTANCE.—The Secretary may use up

to 5 percent of the total amount reserved under paragraph
(1) for any fiscal year to provide, by contract, technical assistance to residents of public housing and resident councils to
help such residents and councils make informed choices about
options for alternative management under this section.
"(c) PROGRAM AUTHORITY.—
"(1) TRANSFER OF MANAGEMENT.—

"(A) I N GENERAL.—The Secretary may approve not
more than 25 applications submitted for fiscal years 1993
and 1994 by resident councils for the transfer of the
management of distressed public housing projects, or one
or more buildings within projects, that are owned or operated by troubled public housing agencies, from public housing agencies to alternative managers.
"(B) REQUIRED VOTES.—^An application for such transfer may be submitted and approved only if a majority
of the members of the board of the resident council has
voted in favor of the proposed transfer of management
responsibilities, and a majority of the residents has also
voted in favor of the transfer in an election supervised
by a disinterested third party.
"(C)

ASSISTANCE OF MANAGEMENT

SPECIALIST.—-Any

resident council seeking to transfer management of distressed public housing under this section shall, in cooperation with the public housing agency for such housing, select
a qualified public housing management specialist to assist
in identifying and acquiring a capable manager for the
housing.
"(2)

REHABILITATION AND CAPITAL IMPROVEMENTS.—The

Secretary may make rehabilitation grants and provide capital
improvement funding under subsection (e) in connection with
the transfer of eligible housing to a manager under this section.
"(d) OPERATING SUBSIDIES.—
"(1) AUTHORITY TO PROVIDE.—^The Secretary may make

operating subsidies under section 9 available to managers under
this section.
"(2) AMOUNT OF SUBSIDY.—The Secretary shall establish
the amount of the operating subsidies made available to a
manager based on the share for the housing under section
9 as determined by the Secretary.
"(3) EFFECT ON PHA GRANT.—Operating subsidies for any

public housing agency transferring management under this
section shall be reduced in accordance with the requirements
of section 9.
"(e) REHABILITATION GRANTS AND CAPITAL IMPROVEMENT FUNDING.—
"(1) REHABILITATION GRANTS.—An application under sub-

section (D may request approval of amounts set aside under
subsection (b) for the rehabilitation of eligible housing. The
manager and the Secretary shall enter into a contract governing
the use of any such assistance provided.
"(2) A N N U A L CAPITAL IMPROVEMENT FUNDING.—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3703

"(A) AuTHORnrY TO PROVIDE.—The Secretary may make
funding for capital improvements available annually from
amoimts under section 14 to managers of eligible housing.
In accordance with the contract entered into pursuant to
subsection (h), each manager receiving such funding shall
establish a capital improvements reserve account and
deposit in the account each year an amount not less than
the annual amount of comprehensive grant funds it
receives. Amounts in the reserve account may be used
only for capital improvements and replacements.
"(B) AMOUNT OF SUBSIDY.—The Secretary shall establish the amount made available to a manager under paragraph (1) for capital improvements based on the share
for the housing under the comprehensive grant formula
and, to the extent practicable, the public housing agencjr's
comprehensive grant plan, in accordance with section 14,
as determined by the Secretary.
"(C) LIMITATION IN THE CASE OF RECENT REHABILITA-

TION.—^Where eligible housing has received rehabilitation
funding under paragraph (1) or has otherwise been comprehensively modernized within 3 years before the effective
date of the contract between the Secretary and the manager
for management of the eligible housing, only the accrual
portion of the comprehensive grant formula amount shall
be available for payment to the manager.
"(D) EFFECT ON PHA GRANT.—The formula amoimt of

a comprehensive grant for a public housing agency transferring the housing imder this section shall be reduced in
accordance with the requirements of section 14.
"(3) RELATIONSHIP TO SECTION 14.—The provisions of section
14 shall apply with respect to rehabilitetion grants under paragraph (1) or capitel improvement funding under paragraph
(2); except that the Secretory may waive the applicability of
any of the provisions of such section where such provisions
are not appropriate tx) the assistonce under this subsection.
"(f) APPLICATION.—
"(1) FORM AND PROCEDURES.—

"(A) I N GENERAL.—^To be eligible for approval for transfer of management from a public housing agency to a
manager and for a grant under subsection (e), a resident
council shall submit an application to the Secretory in
such form and in accordance with such procedures as the
Secretory shall estoblish.
"(B) PHA COMMENT ON APPLICATION.—A resident council submitting an application shall provide the public housing agency that owns or operates the housing involved
a reasonable opportunity to comment on the application,
as the Secretory shall prescribe.
"(C) PHA PROPOSAL.—^The public housing agency may
present to the resident coimcil a proposal for the continued
management of the housing by the agency, and the resident
coimcil shall give reasonable consideration to any such
proposal.
"(2) MINIMUM REQUIREMENTS.—The Secretory shall require
that an application contoin—
"(A) a description of the resident council and documentation of its authority;

59-194 O—93

3:QL3(Pt. 5)

106 STAT. 3704

PUBLIC LAW 102-550—OCT. 28, 1992
"(B) documentation of the votes required under subsection (cXl)(B);
"(C) a description of the proposed manager selected
by the appUcant (in accordance with procedures estabhshed
or approved by the Secretary) and documentation of its
capacity to manage the eUgible housing;
"(D) a plan for carrying out the manager's responsibilities for managing the eligible housing;
"(E) documentation that the project (or building or
buildings) for which management transfer is proposed is
eligible housing;
"(F) documentation that each of the requirements
under paragraph (IXB) have been fulfilled;
"((jrXi) if the application includes a request for a
rehabilitation grant under subsection (e) (which shall be
included in any application involving eligible housing that
is 50 percent or more vacant), the basis for the estimate
of the amount requested, including—
"(I) the estimate of the eligible housing's need
imder the public housing agenc/s comprehensive plan
(under section 14(e)(1)); and
"(II) an explanation, where appropriate, if an
amount higher than the amount planned by the agency
is being requested; or
"(ii) if the application does not include a request for
a rehabilitation grant under subsection (e), a demonstration
that needs for capital improvements and replacement for
the housing can reasonably be expected to be funded from
funding for capital improvements under subsection (e);
"(H) if the manager proposes to administer a program
to enable residents to achieve economic independence and
self-sufficiency, a description of the program and evidence
of commitment of resources to the program;
"(I) an analysis showing that the planned rehabilitation
will result in the long-term viability of the housing at
a reasonable cost;
"(J) a certification that the manager will comply with
the requirements of the Fair Housing Act, title VI of the
Civil Rights Act of 1964, section 504 of the Rehabilitation
Act of 1973, and the Age Discrimination Act of 1975, and
will affirmatively further fair housing; and
"(K) such other information that the Secretary considers appropriate.
"(g) REVIEW AND APPROVAL BY THE SECRETARY.—
"(1) APPLICATIONS NOT REQUESTING REHABILITATION ASSIST-

ANCE.—In the case of applications for the transfer of management of public housing that do not include a request for
rehabilitation assistance under subsection (e), the Secretary
may approve an application that meets the requirements of
subsection (fK2) and this section.
"(2) APPLICATIONS REQUESTING REHABILITATION GRANTS.—

R^ulations.

In the case of applications that include a request for rehabilitation assistance under subsection (e), the Secretary shall select
applicants for approval based on a national competition. The
Secretary shall, by regulation, establish selection criteria for
the competition which provide for separate rating of applicants
under this paragraph and of applicants under this section.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3705

and for selections from a single list of all applicants. The
criteria shall include—
"(A) the quality of the plan for rehabilitating the
eligible housing;
"(B) the exUmt of the capacity or potential capacity
of the proposed manager to manage the housing and to
carry out the rehabilitation program;
"(C) the extent to which a program is proposed to
enable residents to achieve economic independence and
self-sufficiency;
"(D) the extent to which the planned rehabilitation
will result in the long-term viabihty of the housing at
a reasonable cost; and
"(E) such other criteria as the Secretary may require.
**(h) CONTRACT BETWEEN SECRETARY AND MANAGER.—

"(1) TERMS.—^After the Secretary approves an application,
the Secretary shall enter into a contract with the manager
for transfer of management of the eligible housing. In addition
to other contract provisions required under this section, the
contract shall—
"(A) give the manager the right to receive operating
subsidies under subsection (d) and capital improvement
funding under subsection (e);
"(B) require the manager to carry out all management
responsibilities for the eligible housing, as provided in or
required by the contract;
"(C) require the manager to carry out, for the eligible
housing, all management responsibilities applicable to public housing agencies owning or operating public housing
projects, including (i) msdntaining the imits in decent, safe,
and sanitary condition in accordance with any standards
for public housing established or adopted by the Secretary,
(ii) determining eligibility of applicants for occupancy of
units subject to the requirements of this Act, (iii) terminating tenancy in accordance with the procedures applicable
to the section 8 new construction program, and (iv) determining the amoxmt of rent paid for units in accordance
with this Act; and
"(D) permit, but not require, the manager to select
applicants from the public housing waiting list maintained
by the public housing agency.
"(2) EXTENSION, IJXPIRATION, AND TERMINATION.—

"(A) IN GENERAL.—^The Secretary shall provide for a
resident council that has entered into a contract under
this subsection to—
"(i) approve the renewal of the contract between
the Secretar]^ and the manager; or
"(ii) disapprove renewal and submit an application
to the Secretary, in accordance with subsection (f),
proposing another manager, which may be the public
housing agency.
"(B) DEFAULT.—If the Secretary determines that a
manager is in default of its responsibilities under the contract, the Secretory may require the resident council to
submit another application proposing a different laanager,
which may be thcs public housing agency,
"(i) OTHER PROGRAM REQUIREMENTS.—

106 STAT. 3706

PUBLIC LAW 102-550—OCT. 28, 1992
"(1) COST UMITATIONS.—The Secretary may establish cost
limitations on activities under this section. The amount of
rehabilitation funds under subsection (eXl) that may be
approved may not exceed the per unit cost limit applicable
to the comprehensive grant program under section 14.
"(2) DEMOLITION AND DISPOSITION NOT PERMITTED.—A manager may not demolish or dispose of eligible housing under
tms section.
"(3)

CAPABIUTY

OF RESIDENT MANAGEMENT CORPORA-

TIONS.—^To be eligible to become a manager under this section,
a resident management corporation—
"(A) shall demonstrate to the Secretary its ability to
manage public housing effectively and efEiciently, as determined by the Secretary, which shall include evidence of
its most recent financial audit; or
"(B) shall arrange for operation of the housing by a
qualified management entity.
"(4) LIMITATIONS ON PHA LIABILITY.—A public housing
Regulations.

agency shall not be liable for any act or failure to act by
the manager or resident council.
"(5) BONDING AND INSURANCE.—Before assuming any
management responsibility for eligible housing, a manager shall
obtain fidelity bonding and insurance, or eqmvalent protection,
in accordance with regulations and requirements established
bv the Secretary. Such bonding and insurance, or its equivalent,
shall be adequate to protect the Secretary and the public hovising agency against loss, theft, embezzlement, or fraudulent
acts on the part of the manager or its employees.
"(6) RESTRICTION ON DISPLACEMENT BEFORE TRANSFER.—

A public housing agency may not involuntarily displace, as
determined by the Secretary, any resident of eligible housing
during the period beginning on the date that an application
under subsection (0 is submitted by a resident council, and
ending upon transfer of management of the housing or, if
the application is disapproved, the date of the disapproval,
"(j) PERFORMANCE REVIEW AND COMPLIANCE.—

"(1) MONITORING.—The Secretary shall monitor the
performance of managers under this section and shall assess
their management performance using the performance indicators established under section 6(jXl).
"(2) RECORDS, REPORTS, AND AUDITS OF MANAGERS.—
"(A) KEEPING OF RECORDS.—Each manager and

resident council under this subtitle shall keep such records
as may be reasonably necessary to disclose the amoiuit
and the disposition by the manager of the proceeds of
assistance received under this section and to ensure compliance with the requirements of this section.
"(B) ACCESS TO DOCUMENTS.—

"(i) SECRETARY.—^The Secretary shall have access
for the purpose of audit and examination to any books,
documents, papers, and records of a manager, resident
council, and public housing agency that are pertinent
to assistance received under, and to the requirements
of, this section.
"(ii) GAO.—The Comptroller General of the United
States, and any duly authorized representatives of the
Comptroller General, shall have access for the purpose

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3707

of audit and examination to any books, documents,
papers, and records of a manager and resident council
that are pertinent to assistance received imder, and
to the requirements of, this section.
"(C) REPORTING REQUIREMENTS.—^Each manager shall
submit to the Secretary such reports as the Secretary determines appropriattj to carry out the Secretary's responsibilities under this section, including an annual financial audit.
"(D) ANNUAL REPORT.—^The Secretary shall submit an
annual report to the Congress evaluating management
transfers under this section compared to other methods
of dealing with severely distressed public housing,
"(k) NONDISCRIMINATION.—No person in the United States
shall, on the grounds of race, color, national origin, religion, or
sex, be excluded from participation in, be denied the benefits of,
or be subjected to discrimination under, any program or activity
funded in whole or in part with funds made available under this
section. Any prohibition against discrimination on the basis of age
under the Age Discrimination Act of 1975 or with respect to an
otherwise qualified handicapped individual as provided in section
504 of the Rehabilitation Act of 1973 shall also apply to any such
program or activity.
"(1) RELATIONSHIP TO OTHER PROGRAMS.—

"(1) HOMEOWNERSHIP.—^After a transfer of management in
accordance with this section, the eligible housing shall remain
eligible for assistance under title III and for sale under section
5(h). Participation in a homeownership program shall be
consistent with a contract between the Secretary and a
manager.
"(2) SELF-SUFFICIENCY.—^Where an application under subsection (f) proposes a program to enable residents to achieve
economic independence and self-sufficiency, consistent with the
objectives of the program under section 23, and demonstrates
that the manager has the capacity to carry out a self-sufficiency
program, the Secretary may approve such a program. Where
such a program is approved, the Secretary shall authorize
the manager to adopt policies consistent with section 23(d)
(relating to maximum rents and escrow savings accounts) and
section 23(e) (relating to effect of increases in family income),
"(m) DEFINITIONS.—For purposes of this section:
"(1) The term 'eligible housing* means a public housing
project, or one or more buildings within a project, that—
"(A) is owned or operated by a troubled public housing
agency; and
"(B) has been identified as severely distressed under
section 24 of this Act.
In the case of an individual building, the building shall, in
the determination of the Secretary, be sufficiently separable
from the remainder of the project to make use of the building
feasible for purposes of this section.
"(2) The term 'manager' means one of the following entities
that has entered into a contract with the Secretary for the
management of eligible housing under this section:
"(A) A public or private nonprofit organization (including, as determined by the Secretary, such an organization
sponsored by the public housing agency).

106 STAT. 3708

PUBLIC LAW 102-550—OCT. 28, 1992
"(B) A for-profit entity, if it has (i) demonstrated experience in providing low-income housing, and (ii) is participating in joint venture with an organization descrioed in
paragraph (3).
"(C) A State or local government, including an agency
or instrumentality thereof
"(D) A public housing agency (other than the public
housing agency that owns the project).
The term does not include a resident council.
"(3) The term 'private nonprofit organization' means any
private nonprofit organization (including a State or locally chartered nonprofit organization) that—
"(A) is incorporated under State or local law;
"(B) has no part of its net earnings inuring to the
benefit of any member, founder, contributor, or individual;
"(C) complies with standards of financial accountability
acceptable to the Secretary; and
"(D) has among its purposes significant activities
related to the provision of decent housing that is affordable
to low-income families.
The term includes resident management corporations.
"(4) The term 'public housing a g e n c / has the meaning
given such term in section 3(b), except that it does not include
Indian housing authorities.
"(5) The term 'public nonprofit organization' means any
public nonprofit entity, except the public housing agency that
owns the eligible housing.
"(6) The term 'resident council* means any nonprofit
organization or association that—
"(A) is representative of the residents of the eligible
housing;
"(B) adopts written procedures providing for the election of officers on a regular basis; and
"(C) has a democratically elected governing board,
elected by the residents of the eligible housing.
"(7) The term 'resident management corporation* means
a resident management corporation established in accordance
with the requirements of the Secretary under section 20.
"(8) The term 'troubled public housing agency* means a
public housing agency with 250 or more units that—
"(A) has been designated as a troubled public housing
agency for the current Federal fiscal year, and for the
2 preceding Federal fiscal years—
"(i) under section 6(j)(2XAXi); or
"(ii) before the implementation of such authority,
under any other procedure for designating troubled
public housing agencies that was used by the Secretary
and is determined by the Secretary to be appropriate
for purposes of this section; and
"(B) has not met targets for improved performance
under section 6(jX2XC).*'.

SEC. 122. ASSISTED HOUSING FOR INDIANS AND ALASKA NATIVES.
(a) EXEMPTION FROM N E W CONSTRUCTION LIMITATION.—Section

201(c) of the United States Housing Act of 1937 (42 U.S.C.
1437aa(c)) is amended by inserting before the period at the end
the following: "or section 6(h) of the United States Housing Act

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3709

of 1937 (relating to a limitation on contracts involving new
construction)".
(b) MODERNIZATION.—-Section 202(bX2) of the United States
Housing Act of 1937 (42 U.S.C. 1437bb(bX2)) is amended by striking
"single" in the second sentence.
(c) PAYMENTS TO MUNICIPALITIES.—Section 203(b) of the United

States Housing Act of 1937 (42 U.S.C. 1437cc(b)) is amended by
adding at the end the following new sentence: 'Notwithstanding
any other provision of this Act, the Secretary shall make annusQ
payments from funds appropriated under section 9(c) to municipalities providing such roads, facilities, and systems in a amount equal
to—
"(1) 10 percent of the applicable shelter rent, minus the
utility allowance; or
"(2) $150,
whichever is greater, for each rental housing unit covered by this
subsection.".
SEC. 123. PUBUC HOUSING EARLY CHILDHOOD DEVELOPMENT SERVICES.

Section 222(g) of the Housing and Urban-Rural Recovery Act
of 1983 (12 U.S.C. 1701z-€ note) is amended to read as follows:
"(g) AUTHORIZATION OF APPROPRIATIONS.—TO the extent provided in appropriation Acts, of any amounts appropriated for fiscal
year 1993 under section 103 of the Housing and Community Development Act of 1974, $5,000,000 shall be available to carry out
tfds section. To the extent approved in appropriation Acts, of any
amounts appropriated for fiscal year 1994 imder section 5(c) of
the United States Housing Act of 1937 for grants for the development of public housing, $5,210,000 shall be available to carry out
this section. Any such amoimts shall remain available until
expended.".
SEC. 124. INDIAN HOUSING CHILDHOOD DEVELOPMENT SERVICES.

(a) FUNDING.—Section 518(a) of the Cranston-Gonzalez
National Affordable Housing Act (12 U.S.C. 1701z-6 note) is
amended by striking the subsection designation and all that follows
through the end of the first sentence and inserting the following:
"(a) FUNDING.—^To the extent provided in appropriation Acts,
of any amoimts appropriated under section 5(c) of the United States
Housing Act of 1937 for fiscal year 1993 for public housing grants
for Indian housing, $5,200,000 may be used to carry out the demonstration program under this section. To the extent provided in
appropriation Acts, of any amoimts appropriated under section 5(c)
of the United States Housing Act of 1937 for fiscal year 1994
for public housing grants for Indian housing, $5,418,400 may be
used to carry out the demonstration progrcun under this section.".
(b) ELIGIBLE RECIPIENTS.—The second sentence of section 518(a)
of the Cranston-Gonzalez National Affordable Hoiising Act (12
U.S.C. 1701Z-6 note) is amended—
(1) by inserting ", Indian housing authorities, and Indian
tribes" after "nonprofit organizations"; and
(2) by inserting ", housing authorities, and tribes" after
"such organizations".

106 STAT. 3710

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 125. PUBLIC HOUSING ONE-STOP PERINATAL SERVICES DEMONSTRATION.

Section 521(g) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 1437t note) is amended to read as follows:
"(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated for carrying out the demonstration program
under this section $200,000 for fiscal year 1993 and $208,400 for
fiscal year 1994.".
SEC. 126. PUBLIC HOUSING YOUTH SPORTS PROGRAMS.
(a) FUNDING FROM PUBLIC AND ASSISTED HOUSING DRUG ELIMINATION FUNDS.—Section 5130 of the Anti-Drug Abuse Act of 1988

(42 U.S.C. 11909) is amended by adding at the end the following
new subsection:
"(c) SET-ASIDE FOR YOUTH SPORTS PROGRAMS.—Of any amount
made available in any fiscal year to carry out this chapter, 5
percent of such amount shall be available for public housing youth
sports program grants under section 520 of the Cranston-Gonzalez
National Affordable Housing Act for such fiscal year.".
(b) ELIGIBILITY OF INSTITUTIONS OF HIGHER LEARNING.—

(1) I N GENERAL.—Section 520(b) of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 11903a(b)) is
amended—
(A) in paragraph (6), by striking "and" at the end;
(B) in paragraph (7), by striking the period at the
end and inserting "; and"; and
(C) by adding at the end the following new paragraph:
"(8) institutions of higher learning that have never participated in a youth sports program assisted under this section.".
(2) TRANSPORTATION COSTS AS ELIGIBLE EXPENSE.—Section

Florida.

520(d) of the Cranston-Gonzalez National Affordable Housing
Act (42 U.S.C. 11903a(d)) is amended by adding at the end
the following new paragraph:
"(4) In the case only of an eligible entity described in
subsection (b)(8), any transportation costs in connection with
the program.".
(c) DEMONSTRATION PROGRAM.—Of any amounts made available
in fiscal year 1993 for carrying out section 520 of the CranstonGronzalez National Affordable Housing Act, the Secretary of Housing
and Urban Development shall provide not more than $500,000
for the program known as the "Success Through Academic and
Recreational Support" program, administered by the City of Fort
Myers, Florida, to demonstrate the effectiveness of programs that
use trained counselors to run sports and academic activities for
at-risk children, including children of low-income families residing
in public housing. The grantee shall comply with all applicable
program requirements under subsections (c), (d), (e), and (h) of
such section. The Secretary shall evaluate the advantages of the
program assisted under this subsection and determine how the
program may provide a model for other cities conducting, or
interested in conducting, similar activities.
SEC. 127. NATIONAL COMMISSION ON DISTRESSED PUBLIC HOUSING.

(a) TERMINATION.—Section 507 of the Department of Housing
and Urban Development Reform Act of 1989 (12 U.S.C. 1715zl a note) is amended by striking "upon the expiration of 18 months

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3711

following the appointment of all the members imder section 503(a)''
and inserting "at the end of September 30,1992".
(b) AUDIT.—Not later than December 30, 1992, the Comptroller Reports.
General of the United States shall conduct an audit of the financial
transactions of the National Commission on Distressed Public Housing to determine the use of any amounts received by the Commission
from the Federal Government before October 1, 1992, and shall
submit a report to the Congress regarding the results of the audit.
TTie Comptroller General and anv duly authorized representatives
of the Comptroller General shall have access to, and the right
to examine and copy, all records and other recorded information
in any form, and to examine any property, within the possession
and control of the Commission that the Comptroller Greneral considers relevant to the audit.
SEC. 128. NATIONAL COMMISSION ON AMERICAN INDIAN, ALASKA
NATIVE, AND NATIVE HAWAIIAN HOUSING.
(a) AUTHORIZATION OF APPROPRIATIONS.—The first sentence of

section 605 of the Department of Housing and Urban Development
Reform Act of 1989 (42 U.S.C. 1437aa note) is amended to read
as follows: There is authorized to be appropriated to carry out
this title $500,000 for fiscal year 1993.".
(b) EXTENSION OF TERMINATION DATE.—Section 602(g) of the
Department of Housing and Urban Development Reform Act of
1989 (12 U.S.C. 1437aa note) is amended by striking "ui)on the 42 u s e 1437aa
expiration of 18 months ififter all members of the Commission are note.
appointed under paragraph (1)" and inserting "on October 1, 1993".
SEC. 129. RENTAL ASSISTANCE FRAUD RECOVERIES.

(a) IN GENERAL.—Section 326(d) of the Housing and Community
Development Amendments of 1981 (42 U.S.C. 1437f note) is
amended to read as follows:
"(d) RENTAL ASSISTANCE FRAUD RECOVERIES.—
"(1) AUTHORITY TO RETAIN RECOVERED AMOUNTS.—The Sec-

retary of Housing and Urban Development shall permit public
housing agencies administering the housing assistence paymente program under section 8 of the United States Housing
Act of 1937 to retein, out of amounte obtained by the agencies
from tenants that are due as a result of fraud and abuse,
an amount (determined in accordance with regulations issued
by the Secretary) equal to the greater of—
"(A) 50 percent of the amount actually collected, or
"(B) the actual, reasonable, and necessary expenses
related to the collection, including costs of investigation,
legal fees, and collection agency fees.
"(2) USE.—^Amomits reteined by an agency shall be made
available for use in support of the affected program or project,
in accordance with regulations issued by the Secretary. Where
the Secretary is the principal party initiating or sustaining
an action to recover amounts from families or owners, the
provisions of this section shall not apply.
"(3) RECOVERY.—Amounts may be recovered under this
paragraph—
"(A) bv an agency throiu^h a lawsuit (including settlement of the lawsuit) broiight by the agency or through
court-ordered restitution pursuant to a criminal proceeding
resulting from an agency s investigation where the agency

106 STAT. 3712

42 use I437f
note.

PUBLIC LAW 102-550—OCT. 28, 1992

seeks prosecution of a family or where an agency seeks
prosecution of an owner; or
"(B) through administrative repayment agreements
with a family or owner entered into as a result of an
administrative grievance procedure conducted by an impartial decisionmaker in accordance with section 6(k) of the
United States Housing Act of 1937.".
(b) EFFECJTIVE DATE.—SuDsection (a) shall apply with respect
to actions by pubUc housing agencies initiated on or after the
date of the enactment of this Act.
SEC. 130. PROJECT-BASED ACCOUNTING.
Section 502(cX2) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 1437d note) is amended by inserting before
the period the following: "for public housing agencies with 500
or more units and not later than January 1, 1994 for public housing
agencies with less than 500 units.
SEC. 131. SALE OF CERTAIN SCATTERED-SITE HOUSING.
The Secretary of Housing and Urban Development shall authorize the Delaware State Housing Authority in the State of Delaware
to sell scattered-site public housing of the Authority under the
provisions of section 5(h) of the United States Housing Act of
1937. Any proceeds from the disposition of such housing shall
be used to purchase replacement scattered-site dwellings, which
shall be considered public housing for the purposes of such Act
and for which the Secretary shall provide annual contributions
for operation, using amounts made available under section 9(c)
of such Act.
SEC. 132. HOMEOWNERSmP DEMONSTRATION PROGRAM IN OMAHA.
NEBRASKA.
(a) ESTABLISHMENT.—^The Secretary shall carry out a program
to facilitate self-sufKciency and homeownership of single-family
homes administered by the Housing Authority of the city of Omaha,
in the State of Nebraska (in this section referred to as the "Housing
Authority^), to demonstrate the effectiveness of promoting
homeownership and providing support services.
(b) PARTICIPATING PUBLIC HOUSING UNITS.—For purposes of
the demonstration program, the Secretary shall authorize tne Housing Authority to designate single-family housing units for eventual
homeownership. Over the term of the demonstration, the demonstration program may be applied to not more than 20 percent
of the total number of public housing units administered by the
Housing Authority. In conducting the demonstration, the Housing
Authority shall affirmatively further fair housing objectives.
(c) NONDISPLACEMENT.—No person who is a tenant of public
housing may be involuntarily relocated or displaced as a result
of the demonstration program.
(d) ECONOMIC SELF-SUFFICIENCY.—

(1) ESTABUSHMENT OF PARTICIPATION CRITERIA.—The Housing Authority shall establish criteria for the participation of
families in the demonstration program. Such criteria shall be
based on factors that may reasonably be expected to predict
a family's ability to succeed in the homeownership program
estabUshed by tms section.
(2) CONTENTS OF PARTICIPATION CRITERIA.—The criteria
referred to in paragraph (1) shall include evidence of interest

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3713

by the family in homeownership, the employment status and
history of employment of family members, and maintenance
by the family of the family's previous dwelling.
(e) PROVISION OF SUPPORTIVE SERVICES.—The Housing Authority shall ensure the availability of supportive services to each family
participating in the demonstration program through its own
resources and through coordination with Federal, State, and local
agencies and private entities. Supportive services available under
the demonstration program may include counseling, remedial education, education for completion of high school, job training and
preparation, financial counseling emphasizing planning for
homeownership, and any other appropriate services.
(f) REPORTS TO CONGRESS.—
(1) BIENNIAL REPORT.—^Upon

the expiration of the 2-year
period beginning on the date of enactment of this Act, and
each 2-year period thereafter, the Secretary of Housing and
Urban Development shall submit to the Congress a report
evaluating the efTectiveness of the demonstration program
established under this section.
(2) FINAL REPORT.—^Not later than 60 days after termination of the demonstration program piu'suant to subsection
(h), the Secretary shall submit to the Congress a final report
evaluating the effectiveness of the demonstration program.
(g) REGULATIONS.—Not later than the expiration of the 90day period beginning on the date of the enactment of this Act,
the Secretary shall issue interim regulations to carry out this section, which shall take effect upon issuance. The Secretary shall
issue final regulations to carry out this subtitle after notice and
opportunity for public comment regarding the interim regulations,
pursuant to the provisions of section 553 of title 5, United States
Code (notwithstanding subsections (aX2), (bXB), and (dX3) of such
section). The duration of the period for public comment shall not
be less than 60 days, and the final regulations shall be issued
not later than the expiration of the 60-day period beginning upon
the conclusion of the comment period and shall take effect upon
issuance.
(h) TERMINATION.—^The demonstration program established
under this section shall terminate 10 years after the date of the
enactment of this Act.

Subtitle C—Section 8 Assistance
SEC. 141. E U G M N J T Y OI^ LOW-INCOME
RENTAL ASSISTANCE.

FAMILIES

TO

RECEIVE

(a) CERTIFICATES.—^The first sentence of section 8(cX4) of the
United States Housing Act of 1937 (42 U.S.C. 1437f(cX4)) is
amended by inserting before the first comma the following: "or
by a family that qualifies to receive assistance under subsection
(b) pursuant to section 223 or 226 of the Low-Income Housing
Preservation and Resident Homeownership Act of 1990".
(b) VOUCHERS.—Section 8(o)(3XA) of the United States Housing
Act of 1937 (42 U.S.C. 1437f(oX3XA)) is amended—
(1) by striking "or" at the end of clause (iii); and
(2) by inserting before the period the following: ", or (v)
a family that qualifies to receive a voucher under section 223

106 STAT. 3714

PUBLIC LAW 102-550—OCT. 28, 1992
or 226 of the Low-Income Housing Preservation and Resident
Homeownership Act of 1990".

SEC. 142. CONTRACT ADJUSTMENTS FOR EXPIRATION OF PROPERTY
TAX EXEMPTION.

Section 8(cX2XB) of the United States Housmg Act of 1937
(42 U.S.C. 1437£(cX2XB)) is amended by inserting after the first
sentence the following new sentence: 'The Secretary shall make
additional adjustments in the maximum monthly rent for units
under contract (subject to the availability of appropriations for
contract amendments) to the extent the Secretary determines such
adjustments are necessary to reflect increases in the actual and
necessary expenses of owning and maintaining the units that have
resulted from the expiration of a real property tax exemption.".
SEC. 143. TERMINATION OF CONTRACTS.

The last sentence of section 8(cX9) of the United States Housing
Act of 1937 (42 U.S.C. 1437£(cX9)) is amended by inserting before
the period at the end the following: ", and such term shall include
termination of the contract for business reasons".
SEC. 144. PREFERENCES FOR VETERANS WITH DISABIUTIES THAT
PREVENT USE OF HOME.

(a) CERTIFICATES.—Section 8(dXlXAXii) of the United States
Housing Act of 1937 (42 U.S.C. 1437f(dXlXAXii)) is amended—
(1) by striking "(V)" and inserting "(VI)"; and
(2) by inserting after "adoption is not available;" the following: "(V) assisting veterans who are eligible and have applied
for assistance, will use the assistance for a dwelling unit
designed for the handicapped, and, upon discharge or eligibility
for discharge from a hospital or nursing home, have physical
disability which, because of the configuration of their homes,
prevents them from access to or use of their homes;".
(b) VOUCHERS.—The third sentence of section 8(oX3XB) of the
United States Housing Act of 1937 (42 U.S.C. 1437f(oX3XB)) is
amended—
(1) by striking "(v)" and inserting "(vi)"; and
(2) by inserting after "adoption is not available;" the following: "(v) assisting veterans who are eligible and have applied
for assistance, will use the assistance for a dwelling unit
designed for the handicapped, and, upon discharge or eligibility
for chscharge from a hospital or nursing home, have physical
disability which, because of the configuration of their homes,
prevents them from access to or use of their homes;".
SEC. 145. TERMINATION OF TENANCY FOR CRIMINAL ACTIVITY.

Section 8(dXlXBXiii) of the United States Housing Act of 1937
(42 U.S.C. 1437f(dXlXBXiii)) is amended—
(1) by inserting ", any criminal activity that threatens
the health, safety, or right to peaceful ei\joyment of their residences by persons residing in the inunediate vicinity of the
premises," before "or any drug-related"; and
(2) by striking "public housing tenant" and inserting "tenant of any unit".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3715

SEC. 146. DEFINITIONS OF "PROJECT-BASED ASSISTANCE" AND TENANT-BASED ASSISTANCE".

Section 8(f) of the United States Housing Act of 1937 (42
U.S.C. 1437f(f)) is amended—
(1) in paragraph (4), by striking "and" at the end;
(2) in paragraph (5), by striking the period at the end
and inserting a semicolon; and
(3) by adding at the end the following new paragraphs:
"(6) the term 'project-based assistance' means rental assistance under subsection (b) that is attached to the structure
pursuant to subsection (d)(2); and
"(7) the term 'tenant-based assistance' means rental assistance under subsection (b) or (o) that is not project-based
assistance.".
SEC. 147. PORTABIUTY.

Section 8(r)(l) of the United States Housing Act of 1937 (42
U.S.C. 1437f(r)) is amended by inserting before the period at the
end the following: "; except that any family not living within the
jurisdiction of a public housing agency at the time that such family
applies for assistance from such agency shall, during the 12-month
period beginning upon the receipt of any tenant-based rental assistance made available on behalf of the family, use such assistance
to rent an eligible dwelling unit located within the jurisdiction
served by such public housing agency".
SEC. 148. FAMILY UNIFICATION ASSISTANCE.

Section 8(x)(l) of the United States Housing Act of 1937 (12 42USCi437f.
U.S.C. 1437fi:x)(l)) is amended to read as follows:
"(1) INCREASE IN BUDGET AUTHORITY.—The budget authority available under section 5(c) for assistance under section
8(b) is authorized to be increased by $100,000,000 on or after
October 1, 1992, and by $104,200,000 on or after October 1,
1993.".
SEC. 149. IMPLEMENTATION OF AMENDMENTS TO PROJECT-BASED Regulations.
42 u s e 1437f
CERTIFICATE PROGRAM.
note.

The Secretary of Housing and Urban Development shall issue
any final regulations necessary to carry out the amendments made
by section 547 of the Cranston-Gonzalez National Affordable Housing Act not later than the expiration of the 180-day period beginning
on the date of the enactment of this Act. The regulations shall
be issued after notice and opportunity for public comment pursuant
to the provisions of section 553 of title 5, United States Code
(notwithstanding subsections (a)(2), (b)(B), and (d)(3) of such section) and shall take effect upon the expiration of the 30-day period
beginning upon issuance.

SEC. 150. EFFECTIVENESS OF SECTION 8 ASSISTANCE FOR PHA- 42 u s e 1437f
note.
OWNED UNITS.

The amendments made by section 548 of the Cranston-Gonzalez
National Affordable Housing Act shall be effective notwithstanding
the absence of any regulations issued by the Secretary of Housing
and Urban Development.

106 STAT. 3716
Regulations.
42 u s e 1437f
note.

42 u s e 1437f
note.

eontracts.

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 151. IMPLEMENTATION OF INCOME EUGIBILITY PROVISIONS
FOR SECTION 8 NEW CONSTRUCTION UNITS.

The Secretary of Housing and Urban Development shall issue
any final regulations necessary to carry out the provisions of section
555 of the Cranston-Gonzalez National AiTordable Housing Act (42
U.S.C. 1437f note) not later than the expiration of the 180-day
period beginning on the date of the enactment of this Act. The
regulations shall be issued after notice and opportunity for public
comment pursuant to the provisions of section 553 of title 5, United
States Code (notwithstanding subsections (aX2), (b)(B), and (dX3)
of such section) and shall take effect upon the expiration of the
30-day period beginning upon issuance.
SEC. 152. MOVING TO OPPORTUNITY FOR FAIR HOUSING.
(a) AUTHORITY.—^Using any amounts available under subsection
(e), the Secretary of Housing and Urban Development shall carry
out a demonstration program to provide tenant-based assistance
under section 8 of the United States Housing Act of 1937 to assist
very low-income families with children who reside in public housing
or housing receiving project-based assistance under section 8 of
the United States Housing Act of 1937 to move out of areas with
high concentrations of persons living in poverty to areas with low
concentrations of such persons. The demonstration program carried
out under this section shall compare and contrast the costs associated with implementing such a program (including the costs of
counseling, supportive services, housing assistance payments and
other relevant program elements) with the costs associated with
the routine implementation of the section 8 tenant-based rental
assistance programs. The Secretary shall enter into annual contributions contracts with public housing agencies to administer
housing assistance pa3anents contracts under the demonstration.
(b) ELIGIBLE CITIES.—

eontracts.

(1) IN GENERAL.—^The Secretary shall carry out the demonstration only in cities with populations exceeding 350,000
that are located in consolidated metropolitan statistical areas
(as designated by the Director of the Office of Management
and Budget) having populations exceeding 1,500,000.
(2) 1993.—Notwithstanding paragraph (1), in fiscal year
1993, only the 5 cities selected for the demonstration under
the item relating to "HOUSING PROGRAMS—ANNUAL CONTRIBUTIONS FOR ASSISTED HOUSING (INCLUDING RESCISSION OF FUNDS)"
of title II of the Departments of Veterans Affairs and Housing
and Urban Development, and Independent Agencies Appropriations Act, 1992 (105 Stat. 745), and the City of Los Angeles,
California, shall be eligible for the demonstration under this
section.
(c) SERVICES.—The Secretary shall enter into contracts with
nonprofit organizations to provide counseling and services in connection with the demonstration.
(d) REPORTS.—

(1) BIENNIAL.—Not later than the expiration of the 2-year
period beginning on the date of the enactment of this Act
(and biennially thereafter), the Secretary shall submit interim
reports to the Congress evaluating the effectiveness of the
demonstration program under this section. The interim reports
shall include a statement of the number of persons served,
the level of counseling and the types of services provided.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3717

the cost of providing such counseling and services, updates
on the employment record of families assisted under the program, £ind any other information the Secretary considers appropriate in evaluating the demonstration.
(2) FINAL.—Not later than September 30, 2004, the Secretary shall submit a final report to the Congress describing
the long-term housing, employment, and educational achievements of the families assisted under the demonstration program. Such report shall also contain an assessment of such
achievements for a comparable population of section 8 recipients
who have not received assistance under the demonstration
program.
(e) FUNDING.—^The budget authority available under section
5(c) of the United States Housing Act of 1937 for tenant-based
assistance under section 8 of such Act is authorized to be increased
by $50,000,000, on or after October 1, 1992, and by $52,100,000,
on or aft«r October 1, 1993, to carry out the demonstration under
this section. Any amounts made available under this paragraph
shall be used in connection with the demonstration under this
section.
(f) IMPLEMENTATION.—^The Secretary may, by notice published Federal
Register,
in the Federal Register, establish any requirements necessary to publication.
carry out the demonstration under this section and the amendment
made by this section. The Secretary shall publish such notice not
later than the expiration of the 90-day period beginning on the
date of the enactment of this Act and shall submit a copy of
such notice to the Congress not less than 15 days before publication.
SEC. 153. DIRECTIVE TO FURTHER FAIR HOUSING OBJECTIVES 42 USC 1437f
UNDER CERTIFICATE AND VOUCHER PROGRAMS.
note.

Not later than 2 years after the date of the enactment of
this Act, the Secretary of Housing and Urban Development, in
consultation with individuals representing fair housing organizations, low-income tenants, public housing agencies, and other
interested parties, shall—
(1) review and comment upon the study prepared by the
Comptroller General of the United States pursuant to section
558(3) of the Cranston-Gonzalez National Affordable Housing
Act;
(2) evaluate the implementation and effects of existing
demonstration and judicially mandated programs that help
minority families receiving section 8 certificates and vouchers
move out of areas with high concentrations of minority persons
living in poverty to areas with low concentrations, including
how such programs differ from the routine implementation
of the section 8 certificate and voucher programs;
(3) independently assess factors (including the adequacy
of section 8 fair market rentals, the level of counseling provided
by public housing agencies, the existence of racial and ethnic
discrimination by landlords) that may impede the geographic
dispersion of families receiving section 8 certificates and
vouchers;
(4) identify and implement any administrative revisions
that would enhance geographic dispersion and tenant choice
and incorporate the positive elements of various demonstration
and judicially mandated mobility programs; and

106 STAT. 3718
Sports-

PUBLIC LAW 102-550—OCT. 28, 1992
(5) submit to the Congress a report describing its findings
under paragraphs (1), (2), and (3), the actions taken under
paragraph (4), and any recommendations for additional demonstration, research, or legislative action.

SEC. 154. HOUSING ASSISTANCE IN JEFFERSON COUNTY, TEXAS.

Section 213(e) of the Housing and Community Development
Act of 1974 (42 U.S.C. 1439(e)) is amended by striking "the Park
Central New Community Project or in adjacent areas that are
recognized by the unit of general local government in which such
Project is located as being included within the Park Central New
Town in Town Project." and inserting "Jefferson County, Texas.".
SEC. 155. COMPLIANCE OF CERTAIN ACTIVITIES WITH LIMITATIONS
ON PROJECT-BASED ASSISTANCE.

Rehabilitation activities undertaken by the Committee for Dignity and Fairness for the Homeless Housing Development, Inc.
in connection with 46 dwelling units that were renovated for permanent housing for the homeless and that are located in Philadelphia,
Pennsylvania, are hereby deemed to have been conducted pursuant
to an agreement with the Secretary of Housing and Urban Development under clause (ii) of the third sentence of section 8(d)(2)(A)
of the United States Housing Act of 1937 (42 U.S.C. 1437fld)(2XA)).

Subtitle D—Other Programs
SEC. 161. PUBLIC AND ASSISTED HOUSING DRUG ELIMINATION.

(a) AUTHORIZATION OF APPROPRIATIONS.—The first sentence of
section 5130(a) of the Anti-Drug Abuse Act of 1988 (42 U.S.C.
11909(a)) is amended to read as follows: 'There are authorized
to be appropriated to carry out this chapter $175,000,000 for fiscal
year 1993 and $182,350,000 for fiscal year 1994.".
(b) FISCAL YEAR 1993 SET-ASIDES.—Section 5130(b) of the AntiDrug Abuse Act of 1988 (42 U.S.C. 11909(b)) is amended—
(1) by striking "SET-ASIDE FOR ASSISTED HOUSING" and
inserting "SET-ASIDES"; and

(2) by inserting after the period at the end the following
new sentence: "Notwithstanding any other provision of law,
of any amounts appropriated for drug elimination grants under
this chapter for fiscal years 1993 and 1994, not more than
6.25 percent shall be available for grants for federally assisted
low-income housing and 5.0 percent shall be available for public
housing youth sports program grants under section 520 of
the Cranston-Gonzalez National Affordable Housing Act.".
(c) DRUG-RELATED ACTIYITY IN OTHER P H A - O W N E D HOUSING.—

Section 5124 of the Anti-Drug Abuse Act of 1988 (42 U.S.C. 11903)
is amended—
(1) by inserting "(a) PUBLIC AND ASSISTED HOUSING.—"

before "Grants"; and
(2) by adding at the end the following new subsection:
"(b) OTHER P H A - O W N E D HOUSING.—Notwithstanding any other
provision of this chapter, grants under this chapter may be used
to eliminate drug-related crime in housing owned by public housing
agencies that is not public housing assisted under the United States
Housing Act of 1937 and is not otherwise federally assisted, for
the activities described in paragraphs (1) through (7) of subsection
(a), but only if—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3719

"(1) the housing is located in a high intensity drug trafficking area designated pursuant to section 1005 of this Act; and
"(2) the pubUc housing agency owning the housing demonstrates, to the satisfaction of the Secretary, that drug-related
activity at the housing has a detrimental effect on or about
the real property comprising any public or other federally
assisted low-income housing.".
(d) ELIGIBILITY OF PUBLIC HOUSING RESIDENT MANAGEMENT

CORPORATIONS.—Chapter 2 of subtitle C of title 5 of the AntiDrug Abuse Act of 1988 (42 U.S.C. 11901 et seq.) is amended—
(1) in section 5123, by inserting after "(including Indian
Housing Authorities)" the following: ", public housing resident
management corporations that are principally managing, as
determined by the Secretary, public housing projects owned
by public housing agencies,";
(2) in paragraph (7) of section 5124(a) (as so designated
by subsection (c) of this section), by inserting after "(7)" the
following: "where a public housing agency receives a grant,";
and
(3) in the first sentence of section 5125(a), by inserting
after "public housing agency" the following: ", a public housing
resident management corporation,".
(e) PUBLICATION OF REGULATIONS.—^Not later than 30 days
after the date of the enactment of this Act, the Secretary shall
publish such final regulations as may be necessary to implement
section 5130(b) of the Public and Assisted Housing Drug Elimination
Act of 1990 (42 U.S.C. 11909(a)).
SEC. 162. HOUSING COUNSELING.

(a) COUNSELING SERVICES.—The first sentence of section
106(aX3) of the Housing and Urban Development Act of 1968 (12
U.S.C. 1701x(a)(3)) is amended by striking "except that" and all
that follows through the period and inserting "except that for such
purposes there are authorized to be appropriated $6,025,000 for
fiscal year 1993 and $6,278,050 for fiscal year 1994. Of the amounts
appropriated for each of fiscal years 1993 and 1994, up to $500,000
shall be available for use for counseling and other activities in
connection with the demonstration program under section 152 of
the Housing and Community Development Act of 1992.".
(b) EMERGENCY HOMEOWNERSHIP COUNSELING.—
(1) AUTHORIZATION OF APPROPRIATIONS.—^The

first sentence
of section 106(c)(8) of the Housing and Urban Development
Act of 1968 (12 U.S.C. 1701x(cX8)) is amended to read as
follows: 'There are authorized to be appropriated to carry out
this section $7,000,000 for fiscal year 1993 and $7,294,000
for fiscal year 1994, of which amounts $1,000,000 shall be
available in each such fiscal year to carry out paragraph
(5XD).".
(2) EXTENSION OF PROGRAM.—Section 106(cX9) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(cX9))
is amended by striking "September 30, 1992" and inserting
"September 30,1994".
(3) AVAILABILITT.—Section 106(cX3XA) of the Housing and
Urban Development Act of 1968 (12 U.S.C. 1701x(cX3XA)) is
amended—
(A) in clause (i), by striking "and" at the end; and
(B) by adding at the end the following new clause:

42 u s e 11902.

42 u s e 11903.

42 u s e 11904.
42 u s e 11909
note.

106 STAT. 3720

PUBLIC LAW 102-550—OCT. 28, 1992
"(iii) have a high incidence of mortgages involving
principal obligations (including such initial service
charges, appraisal, inspection, and other fees as the
Secretary shall approve) in excess of 97 percent of
the appraised value of the properties that are insured
pursuant to section 203 of the National Housing Act;
and".
(4) ELIGIBILITY.—Section 106(cX4) of the Housing and
Urban Development Act of 1968 (12 U.S.C. 1701x(cX4)) is
amended by adding at the end the following new flush sentence:
"An applicant for a mortgage shall be eligible for homeownership counseling under this subsection if the applicant is a
first-time homebuyer who meets the requirements of section
303(b)(1) of the Cranston-Gonzalez National Affordable Housing
Act and the mortgage involves a principal obligation (including
such initial service charges, appraisal, inspection, and other
fees as the Secretary shall approve) in excess of 97 percent
of the appraised value of the property and is to be insured
pursuant to section 203 of the National Housing Act.".
(5) NOTIFICATION OF AVAILABILITY.—Section 106(cX5XA) of
the Housing and Urban Development Act of 1968 (12 U.S.C.
1701x(c)(5)(A)) is amended by striking subparagraph (A) and
inserting the following new subparagraph:
"(A) NOTIFICATION OF AVAILABILITY OF HOMEOWNERSHIP
COUNSELING.—

"(i) REQUIREMENT.—Except as provided in
subparagraph (C), the creditor of a loan (or proposed
creditor) shall provide notice under clause (ii) to (I)
any eligible homeowner who fails to pay any amoiuit
by the date the amount is due under a home loan,
and (II) any applicant for a mortgage described in
paragraph (4).
"(ii) CONTENT.—^Notification under this subparagraph shall—
"(I) notify the homeowner or mortgage
applicant of the availability of any homeownership
counseling offered by the creditor (or proposed
creditor);
"(II) if provided to an eligible mortgage
applicant, state that completion of a counseling
program is required for insurance pursuant to section 203 of the National Housing Act; and
"(III) notify the homeowner or mortgage
applicant of the availability of homeownership
counseling provided by nonprofit organizations
approved by the Secretary and experienced in the
provision of homeownership coimseling, or provide
the toll-free telephone number described in
subparagraph (D)(i).".
(6) ANNUAL UPDATE OF LIST OF COUNSELING ORGANIZATIONS
FOR TOLL-FREE NUMBER.—The matter preceding subclause (I)

in section 106(c)(5)(D)(i) of the Housing and Urban Development
Act of 1968 (12 U.S.C. 1701x(cX5XD)(i)) is amended by inserting
", which shall be updated annually," after "organizations".
(c) PREPURCHASE AND FORECLOSURE-PREVENTION COUNSELING

DEMONSTRATION.—Section 106(dX12) of the Housing and Urban

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3721

Development Act of 1968 (12 U.S.C. 1701x(dX12)) is amended to
read as follows:
"(12) AuTHORiz.\TiON OF APPROPRIATIONS.—There are
authorized to be appropriated to carry out this subsection
$365,000 for fiscal year 1993 and $380,330 for fiscal year 1994.".
(d) ELIGIBILITY FOR COUNSELING ASSISTANCE UNDER HOUSING
AND URBAN DEVELOPMENT ACT OF 1968 AND CERTIFICATION AND
TRAINING PROGRAM.—Section 106 of the Housing and Urban Devel-

opment Act of 1968 (12 U.S.C. ITOlx) is amended by adding at
the end the following new subsections:
"(e) CERTIFICATION.—
"(1) REQUIREMENT FOR ASSISTANCE.—An organization may

not receive assistance for counseling activities under subsection
(a)(l)(iii), (a)(2), (c), or (d), unless the organization provides
such counseling, to the extent practicable, by individuals who
have been certified by the Secretary under this subsection
as competent to provide such counseling.
"(2) STANDARDS AND EXAMINATION.—The Secretary shall, Regulations.
by regulation, establish standards and procedures for testing
and certifying counselors. Such standards and procedures shall
require for certification that the individual shall demonstrate,
by written examination (as provided under subsection (fX4)),
competence to provide counseling in each of the following areas:
"(A) Financial management.
"(B) Property maintenance.
"(C) Responsibilities of homeownership and tenancy.
"(D) Fair housing laws and requirements.
"(E) Housing affordability.
"(F) Avoidance of, and responses to, rental and mortgage delinquency and avoidance of eviction and mortgage
default.
"(3) ENCOURAGEMENT.—The Secretary shall encourage
organizations engaged in providing homeownership and rental
counseling that do not receive assistance under this section
to employ individuals to provide such counseling who are certified under this subsection or meet the certification standards
established under this subsection.
"(0 HOMEOWNERSHIP AND RENTAL COUNSELOR TRAINING AND
CERTIFICATION PROGRAMS.—

"(1) ESTABLISHMENT.—^To the extent amounts are provided
in appropriations Acts under paragraph (7), the Secretary shall
contract with an appropriate entity (which may be a nonprofit
organization) to carry out a program under this subsection
to train individuals to provide homeownership and rental counseling and to administer the examination under subsection
(e)(2) and certify individuals under such subsection.
"(2) ELIGIBILITY .AND SELECTION.—

"(A) ELIGIBILITY.—To be eligible to provide the training
and certification program under this subsection, an entity
shall have demonstrated experience in training homeownership and rental counselors.
"(B) SELECTION.—The Secretary shall provide for entities meeting the requirements of subparagraph (A) to
submit applications to provide the training and certification
program under this subsection. The Secretary shall select
an application based on the ability of the entity to—

106 STAT. 3722

PUBLIC LAW 102-550—OCT. 28, 1992
"(i) establish the program as soon as possible on
a national basis, but not later than the date under
paragraph (6);
^ii) minimize the costs involved in establishing
the pro-am; and
"(iii) effectively and efficiently carry out the program.
"(3) TRAINING.—^The Secretary shall require that training
of coimselors imder the program imder this subsection be
designed and coordinated to prepare individuals for successfid
completion of the examination for certification under subsection
(eX2). The Secretary, in consultation with the entity selected
imder paragraph (2)(B), shall establish the curriculum and
standards for training counselors iinder the program.
"(4) CERTIFICATION.—^The entity selected imder paragraph
(2XB) shall administer the examination under subsection (eX2)
and, on behalf of the Secretanr, certify individuals successfiillv
completing the examination. Tne Secretory, in consultotion with
such entity, shall estoblish the content and format of the
examination.
"(5) FEES.—Subiect to the approval of the Secretory, the
entity selected under paragrapn (2XB) may estoblish and
impose reasonable fees for participation in the training provided
under the program and for examination and certification under
subsection (eX2), in an amount sufficient to cover any costo
of such activities not covered with amounte provided under
paragraph (7).
^(6) TIMING.—The entity selectod under paragraph (2XB)
to carry out the training and certification program shall estoblish the program as soon as possible after such selection, and
shall make training and certification available under the program on a national basis not later than the expiration of
the 1-year period beginning upon such selection.
"(7)

42 use I70ix
"°*®-

AUTHORIZATION

OF

APPROPRIATIONS.—^There

are

authorized to be appropriatod to carry out this subsection
$2,000,000 for fiscalyear 1993 and $2,084,000 for 1994.".
(e) REGULATIONS.—The Secretory of Housing and Urban Development shall issue any regulations necessary to carry out the
amendmente made by subsection (d), not lator than the expiration
of the 6-month period beginning on the dato of the enactment
of this Act.
SEC. 163. USE OF FUNDS RECAPTURED FROM REFINANCING STATE
A N D LOCAL F I N A N C E PROJECTS.

IN GENERAL.—Section 1012 of the Stowart B. McKinney Homeless Assistance Amendmente Act of 1988 (42 U.S.C. 1437f noto)
is amended to read as follows:
"SEC. 1012. USE OF FUNDS RECAPTURED FROM REFINANCING STATE
AND LOCAL FINANCE PROJECTS.

"(a) DEFINITION OF QUAUFIED PROJECT.—For purposes of this
section, the torm'qualified project'means any Stoto financed project
or local government or local housing agency financed project, that—
"(1) was—
"(A) provided a financial adjustment factor under section 8 of the United Stotes Housing Act of 1937; or
"(B) constructed or substontially rehabilitoted pursuant to assistonce provided under a contract under section

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3723

8(bX2) of the United States Housing Act of 1937 (as in
effect on September 30, 1983) entered into during any
of calendar years 1979 through 1984; and
"(2) is being refinanced.
"(b) AVAILABILITY OF FUNDS.—The Secretary shall make available to the State housing finance agency in me State in which
a qualified project is located, or the local government or local
housing agency initiating the refinancing of uie qualified project,
as applicable, an amount equal to 50 percent of the amounts recapturedfiromthe project (aii determined oy the Secretary on a projectby-project basis). Notwithstanding any other provision of law, such
amounts shall be used only for provimng decent, safe, and sanitary
housing affordable for very low-income families and persons.
"(c) APPUCABILTTY AND BUDGET COMPLIANCE.—

"(1) RETROACTIVITY.—^This section shall apply to
refinancings of projects for which settlement occurred or occurs
before, on, or alter the date of the enactment of the Housing
and Community Development Act of 1992, subject to the provisions of paragraph (2).
"(2) BUDGET COMPLIANCE.—This section shall apply only
to the extent or in such amounts as are provided in appropriation Acts.".
SEC. 164. HOPE FOR YOUTH.

Title IV of the Cranston-Gonzalez National Affordable Housing
Act (42 U.S.C. 1437aaa note et seq.) is amended by adding at
the end the following new subtitle:

"Subtitle D—HOPE for Youth: Youthbuild Ds d a t gd
ia v na e
'^EC. 451. STATEMENT OF PURPOSE.

42 USC 12899.

I t is the purpose of this subtitle—
"(1) to expand the supply of permanent affordable housing
for homeless individuals and members of low- and very lowincome families by utilizing the energies and talents of economically disadvantaged young adults;
"(2) to provide economically disadvantaged young adults
with opportunities for meaningful work and service to their
communities in helping to meet t^e housing needs of homeless
individuals and members of low- and very low-income families;
"(3) to enable economically disadvantaged young adults
to obtain the education and employment skills necessary to
achieve economic self-sufficiency; and
"(4) to foster the development of leadership skills and
commitment to community development among young adults
in low-income communities.
'9EC. 452. PROGRAM AUTHORITY.

42 USC 12899a.

*The Secretary may make—
''(I) planning grants to enable applicants to develop
Youthbuild programs; and
'%2) implementation grants to enable applicants to carry
out Youthbuild programs.
"SEC. 453. PLANNING GRANTS.

''(a) GRANTS.—^The Secretary is authorized to make planning
grants to applicants for the purpose of developing Youthbuild pro-

42 USC 12899b.

106 STAT. 3724

PUBLIC LAW 102-550—OCT. 28, 1992

grams under this subtitle. The amount of a planning grant under
this section may not exceed $150,000, except that the Secret£uy
may for good cause approve a grant in a higher amoimt.
"(b) ELIGIBLE ACTIVITIES.—Planning grants may be used for
activities to develop Youthbuild programs including—
"(1) studies of the feasibility of a Youthbuild program;
"(2) establishment of consortia between youth training and
education programs and housing owners or developers, including any organizations specified in section 457(2), which will
participate in the Youthbuild program;
"(3) identification and selection of a site for the Youthbuild
program;
"(4) preliminary architectural and engineering work for
the Youthbuild program;
"(5) identification and training of staff for the Youthbuild
program;
"(6) planning for education, job training, and other services
that will be provided as part of the Youthbuild program;
"(7) other planning, training, or technical assistance necessary in advance of commencing the Youthbuild program; and
"(8) preparation of an application for an implementation
grant under this subtitle.
"(c) APPLICATION.—
"(1) FORM AND PROCEDURES.—^An application for a planning

grant shall be submitted by an applicant in such form and
in accordance with such procedures as the Secretary shall
establish.
"(2) MINIMUM REQUIREMENTS.—The Secretary shall require
that an application contain at a minimimi—
"(A) a request for a planning grant, specifying the
activities proposed to be carried out, the schedule for
completing the activities, the personnel necessary to complete the activities, and the amount of the grant requested;
"(B) a description of the applicant £md a statement
of its qualifications, including a description of the
applicant's past experience with housing rehabilitation or
construction and with youth and youth education and
employment training programs, and its relationship with
local imions and apprenticeship programs, and other
community groups;
"(C) identification and description of potential sites
for the program and the construction or rehabilitation
activities that would be undertaken at such sites; potential
methods for identifying and recruiting youth participants;
potential educational and job training activities, work
opportunities and other services for participants; and potenti£U coordination with other Federal, State, and local housing and youth education and employment training activities
including activities conducted by Indian tribes;
"(D) a certification by the public official responsible
for submitting the comprehensive housing affordability
strategy under section 105 of the Cranston-Gonzalez
National Affordable Housing Act that the proposed activities are consistent with the approved housing strategy of
the State or unit of general local government within which
the project is located; and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3725

"(E) a certification that the applicant will comply with
the requirements of the Fair Housing Act, title VI of the
Civil Rights Act of 1964, section 504 of the Rehabilitation
Act of 1973, and the Age Discrimination Act of 1975, and
will affirmatively further fair housing.
"(d) SELECTION CRITERIA.—^The Secretan^ shall, by regulation,

Regulations.

establish selection criteria for a national competition for assistance
under this section, which shall include—
"(1) the qualifications or potential capabilities of the
applicant;
"(2) the potential of the appUcant for developing a successful and affordable Youthbuild program;
"(3) the need for the prospective program, as determined
by the degree of economic distress—
"(A) of the community from which participants would
be recruited (such as poverty, youth unemplojrment, and
number of individuals who have dropped out of high school);
and
"(B) of the community in which the housing proposed
to be constructed or rehabilitated would be located (such
as incidence of homelessness, shortage of affordable housing, and poverty); and
"(4) such other factors that the Secretary shall require
that (in the determination of the Secretary) are appropriate
for purposes of carr^dng out the program established by this
subtitle in an effective and efilcient manner.
'^EC. 4S4. mPLEMENTATION GRANTS.

"(a) GRANTS.—^The Secretary is authorized to make implementation grants to applicants for the purpose of carrying out Youthbuild
programs approved under this subtitle.
"(b) ELIGIBLE ACTIVITIES.—Implementation grants may be used
to carry out Youthbuild programs, including the following activities:
"(1) Architectural and engineering work.
"(2) Acquisition, rehabilitation, acquisition and rehabilitation, or construction of housing and related facilities to be
used for the piuposes of providing homeownership iinder subtitle B and subtitle C of this title, residential housing for
homeless individuals, and low- and very low-income families,
or transitional housing for persons who are homeless, have
disabilities, are ill, are deinstitutionaUzed, or have other special
needs.
"(3) Administrative costs of the applicant, which may not
exceed 15 percent of the amount of assistance provided under
this section, or such higher percentage as the l^cretary determines is necessary to support capacity development by a private
nonprofit organization.
"(4) Education and job training services and activities
including—
"(A) work experience and skills training, coordinated,
to the maximum extent feasible, with preapprenticeship
and apprenticeship programs, in the construction and
rehabilitation activities described in subsection (bX2);
"(B) services and activities designed to meet the educational needs of participants, including—
"(i) basic skills instruction andf remedial education;

42 u s e 12899c.

106 STAT. 3726

PUBLIC LAW 102-550—OCT. 28, 1992
"(ii) bilingual education for individuals with limited-English proficiency;
''(iii) secondary education services and activities
designed to lead to the attainment of a high school
diploma or its equivalent; and
"(iv) coimseling and assistance in attaining postsecondary education and required financial aid;
"(C) counseling services and related activities;
"(D) activities designed to develop employment and
leadership skills, including support for youth councils; and
"(E) support services and need-based stipends necessary to enable individuals to participate in the program
and, for a period not to exceed 12 months after completion
of training, to assist participants through support services
in retaining emplo3anent.
"(5) Wage stipends and benefits provided to participants.
"(6) Funding of operating expenses and replacement
reserves of the property covered by the Youthbuild program.
"(7) Legal fees.
"(8) Defrajdng costs for the ongoing training and technical
assistance needs of the recipient that are related to developing
and carrying out the Youthbuild program.
"(c) APPLICATION.—
"(1)
FORM AND

PROCEDURE.—An

appKcation

for

an

implementation grant shall be submitted by an applicant in
such form and in accordance with such procediu*es as the Secretary shall establish.
"(2) MINIMUM REQUIREMENTS.—The Secretary shall require
that an application contain at a minimum—
(A) a request for an implementation grant, specifying
the amount of the ^ a n t requested and its proposed uses;
"(B) a description of the applicant and a statement
of its qualifications, including a description of the
applicant s past experience with housing rehabilitation or
construction and with youth and youth education and
employment training programs, and its relationship with
local unions and apprenticeship programs, and other
community groups;
"(C) a description of the proposed site for the program;
"(D) a description of the educational and job training
activities, work opportunities, and other services that will
be provided to participants;
"(E) a description of the proposed construction or
rehabilitation activities to be imdertaken and the anticipated schedule for carrying out such activities;
"(F) a description of the manner in which eligible
youths will be recruited and selected, including a description of arrangements which will be made with commimitybased organizations, State and local educational agencies,
including agencies of Indian tribes, public assistance agencies, the courts of jurisdiction for status £uid youth offenders, shelters for homeless individuals and other agencies
that serve homeless youth, foster care agencies, and other
appropriate public and private agencies;
"(G) a description of the special outreach efforts that
will be undertaken to recruit eligible young women (including young women with dependent children);

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3727

"(H) a description of how the proposed program will
be coordinated ^vith other Federal, State, and local activities and activities conducted by Indian tribes, including
vocational, adult and bilingual education programs, job
training provided with funds available under the Job Training Partnership Act and the Family Support Act of 1988,
and housing and community development programs, including programs that receive assistance luider section 106
of the Housing and Community Development Act of 1974;
"(I) assurances that there will be a sufficient number
of adequately trained supervisory personnel in the program
who have attained the level of journeyman or its equivalent;
"(J) a description of the applicant's relationship with
local building trade unions regarding their involvement
in training, and the relationship of the Youthbuild program
with established apprenticeship programs;
"(K) a description of activities that will be undertaken
to develop the leadership skills of participants;
"(L) a detailed budget and a description of the system
of fiscal controls and auditing and accoimtability procedures that will be used to ensure fiscal soundness;
"(M) a description of the commitments for any additional resources to be made available to the program from
the applicant, from recipients of other Federal, State or
local housing and community development assistance who
will sponsor any part of the construction, rehabilitation,
operation and maintenance, or other housing and community development activities undertaken as part of the program, or from other Federal, State or local activities and
activities conducted by Indian tribes, including, but not
limited to, vocational, adult and bilingual education programs, and job training provided with funds available
under the Job Training Partnership Act and the Family
Support Act of 1988;
"(N) identification and description of the financing proposed for any—
"(i) rehabilitation;
"(ii) acquisition of the property; or
"(iii) construction;
"(O) identification and description of the entity that
will operate and manage the property;
"(P) a certification by the public official responsible
for submitting the comprehensive housing affordability
strategy under section 105 of the Cranston-Gronzalez
National Affordable Housing Act that the proposed activities are consistent with the approved housing strategy of
the State or unit of general local government within which
the project is located; and
"(Q) a certification that the applicant will comply with
the requirements of the Fair Housing Act, title Vl of the
Civil Rights Act of 1964, section 504 of the Rehabilitation
Act of 1973, and the Age Discrimination Act of 1975, and
will affirmatively further fair housing.
"(d) SELECTION CRITERIA.—The Secretary shall establish selection criteria for assistance under this section, which shall include—
"(1) the qualifications or potential capabilities of the
applicant;

106 STAT. 3728

PUBLIC LAW 102-550—OCT. 28, 1992
''(2) the feasibility of the Youthbuild program;
''(3) the potential for developing a successful Youthbuild
program;
''(4) the need for the prospective project, as determined
by the degree of economic distress of the community from
which participants would be recruited (such as poverty, youth
imemployment, number of individuals who have dropped out
of high school) and of the community in which the housing
proposed to be constructed or rehabilitated would be located
(such as incidence of homelessness, shortage of affordable housing, poverty);
"(5) the apparent commitment of the applicant to leadership
development, education, and training of participants;
"(6) the inclusion of previously homeless tenants in the
housing provided;
"(7) the commitment of other resources to the program
by the applicant and by recipients of other Federal, State
or local housing and community development assistance who
will sponsor any part of the construction, rehabilitation, operation and maintenance, or other housing and commimity development activities imdertaken as part of the program, or by
other Federal, State or local activities and activities conducted
by Indian tribes, including, but not limited to, vocational, adult
and bilingual education programs, and job training provided
with funds available under the Job Training Partnership Act
and the Family Support Act of 1988; and
"(8) such other factors as the Secretary determines to be
appropriate for purposes of canying out the program established by this subtitle in an effective and efficient manner.

"(e) PRIORITY FOR APPLICANTS W H O OBTAIN HOUSING MONEY
FROM OTHER SOURCES.—^The Secretary shall give priority in the

award of grants under this section to applicants to the extent
that they propose to finance activities described in paragraphs
(1), (2), and (6) of subsection (b) from funds provided from Federal,
State, local, or private sources other than assistance imder this
subtitle.
"(f) APPROVAL.—^The Secretary shall notify each applicant, not
later than 4 months after the date of the submission of the application, whether the application is approved or not approved.
"(g)
COMBINED PLANNING AND IMPLEMENTATION GRANT
APPLICATION PROCEDURE.—^The Secretary shall develop a procedure

under which an applicant may apply at the same time and in
a single application for a planning grant and an implementation
grant, with receipt of the implementation grant conditioned on
successful completion of the activities funded by the planning grant.
42 u s e 12899d.

«SEC. 455. YOUTHBUILD PROGRAM REQUIREMENTS.

"(a) RESIDENTIAL RENTAL HOUSING.—Each residential rental
housing project receiving assistance imder this subtitle shall meet
the following requirements:
"(1) OCCUPANCY BY LOW- AND VERY LOW-INCOME FAMIUES.—

In the project—
"(A) at least 90 percent of the units shall be occupied,
or available for occupancy, by individuals and families with
incomes less than 60 percent of the area median income,
adjusted for family size; and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3729

"(B) the remaining units shall be occupied, or available
for occupancy, by low-income families.
"(2) TENANT PROTECTIONS.—

"(A) LEASE.—The lease between a tenant and an owner
of residential rental housing assisted imder this subtitle
shall be for not less than 1 year, unless otherwise mutually
agreed to by the tenant and the owner, and shall contain
such terms and amditions as the Secretary shall determine
to be appropriate.
"(B) TERMINATION OF TENANCY.—An owner shall not
terminate the tenancy or refuse to renew the lease of
a tenant of residential rental housing assisted under this
title except for serious or repeated violation of the terms
and conditions of the lease, for violation of applicable Federal, State, or local law, or for other good cause. Any
termination or refusal to renew must be preceded by not
less than 30 days by the owner's service upon the tenant
of a written notice specifying the grounds for the action.
"(C) MAINTENANCE AND REPLACEMENT.—^The owner of
residential rental housing assisted under this subtitle shall
maintain the premises in compliance with all applicable
housing quality standards and local code requirements.
"(D) TENANT SELECTION.—^The owner of residential
rental housing assisted under this subtitle shall adopt written tenant selection policies and criteria that—
"(i) are consistent with the purpose of providing
housing for very low-income and low-income families
and individuals;
"(ii) are reasonably related to program eligibility
and the applicant's ability to perform the obligations
of the lease;
"(iii) give reasonable consideration to the housing
needs of families that would qualify for a preference
under section 6(cX4XA) of the United States Housing
Act of 1937; and
"(iv) provide for (I) the selection of tenants from
a written waiting list in the chronological order of
their application, to the extent practicable, and (II)
for the prompt notification in writing of any rejected
applicant of the grounds for any rejection.
"(3) LIMITATION ON RENTAL PAYMENTS.—Tenants in each
project shall not be required to pay rent in excess of the
amount provided under section 3(a) of the United States Housing Act of 1937.
"(4) TENANT PARTICIPATION PLAN.—For each project owned
by a nonprofit organization, the organization shall provide a
plan for and follow a program of tenant participation in
management decisions.
"(5) PROHIBITION AGAINST DISCRIMINATION.—A unit in a
)roject assisted under this subtitle may not be refused for
{easing to a family holding tenant-based assistance imder section 8 of the United States Housing Act of 1937 because
of the status of the prospective tenant as a holder of such
assistance.
"(b) TRANSITIONAL HOUSING.—Each transitional housing project

receiving assistance under this subtitle shall adhere to the requirements regarding service delivery, housing standards, and rent

106 STAT. 3730

PUBLIC LAW 102-550—OCT. 28, 1992

limitations applicable to comparable housing receiving assistance
under title IV of the Stewart B. McKinney Homeless Assistance
Act.
"(c) LIMITATIONS ON PROFITS FOR RENTAL AND TRANSITIONAL
HOUSING.—
"(1) MONTHLY RENTAL LIMITATION.—The aggregate monthly

rental for each eligible project may not exceed the operating
costs of the project (including debt service, management, adequate reserves, and other operating costs) plus a 6 percent
return on any equity investment of the project owner.
"(2)

PROFIT

LIMITATIONS

ON P A R T N E R S . ^ A

nonprofit

organization that receives assistance under this subtitle for
a project shall agree to use any profit received from the operation, sale, or other disposition of the project for the purpose
of providing housing for low- and moderate-income families.
Profit-motivated partners in a nonprofit partnership may
receive—
"(A) not more than a 6 percent return on their equity
investment from project operations; and
"(B) upon disposition of the project, not more than
an amount equal to their initial equity investment plus
a return on that investment equal to the increase in the
Consumer Price Index for the geographic location of the
project since the time of the initial investment of such
partner in the project.
"(d) HOMEOWNERSHIP.—Each homeownership project that
receives assistance under this subtitle shall comply with the requirements of subtitle B or subtitle C of this title.
"(e) RESTRICTIONS ON CONVEYANCE.—^The ownership interest

in a project that receives assistance imder this subtitle may not
be conveyed imless the instrument of conveyance requires a subsequent owner to comply with the same restrictions imposed upon
the original owner.
"(f) CONVERSION OF TRANSITIONAL HOUSING.—The Secretary

42USC12899e.

may waive the requirements of subsection (b) to permit the conversion of a transitional housing project to a permanent housing project
only if such housing would meet the requirements for residential
rental housing specified in this section.
"(g) PERIOD OF RESTRICTIONS.—^A project that receives assistance under this subtitle shall comply with the requirements of
this section for the remaining useful life of the property.
"SEC. 456. ADDITIONAL PROGRAM REQUIREMENTS.
"(a) ELIGIBLE PARTICIPANTS.—

"(1) I N GENERAL.—Except as provided in paragraph (2),
an individual may participate in a Youthbuild program receiving assistance under this subtitle only if such individual is—
"(A) 16 to 24 years of age, inclusive;
"(B) a very low-income individual or a member of a
very low-income family; and
"(C) an individual who has dropped out of high school.
"(2) EXCEPTION FOR INDIVIDUALS NOT MEETING INCOME OR

EDUCATIONAL NEED REQUIREMENTS.—^Not more than 25 percent
of the participants in such program may be individuals who
do not meet the requirements of either paragraphs (IXB) or
((J), but who have educational needs despite attainment of
a high school diploma or its equivalent.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3731

"(3) PARTICIPATION LIMITATION.—Any eligible individual
selected for full-time participation in a Youtiibuild program
may be offered full-time participation for a period of not less
than 6 months and not more than 24 months.
**(b) MINIMUM TIME DEVOTED TO EDUCATIONAL SERVICES AND

AcnvrriES.—A Youthbuild program receiving assistance under this
subtitle shall be structured so that 50 percent of the time spent
by participants in the program is devoted to educational services
and activities, such as those specified in subparagraphs (B) through
(F) of section 454(bX4).
"(c) AUTHORITY RESTRICTION.—"So provision of this subtitle may
be construed to authorize any agency, ofi&cer, or employee of the
United States to exercise any direction, supervision, or control
over the curriculum, program of instruction, administration, or
personnel of any educational institution, school, or school system,
or over the selection of library resources, textbooks, or other printed
or published instructional materials by any educational institution
or school system.
"(d) STATE AND LOCAL STANDARDS.—All educational programs
and activities supported with funds provided under this subtitle
shall be consistent with applicable State and local educational
standards. Standards and procedures with respect to the awarding
of academic credit and certifying educational attainment in such
programs shall be consistent with applicable State and local educational standards.
"(e) WAGES, LABOR STANDARDS, AND NONDISCRIMINATION.^TO

the extent consistent with the provisions of this subtitle, sections
142, 143 and 167 of the Job Training Partnership Act, relating
to wages and benefits, labor standards, and nondiscrimination, shall
apply to the programs conducted under this subtitle as if such
programs were conducted under the Job Training Partnership Act.
This section may not be construed to prevent a recipient of a
grant under this subtitle from using funds from non-Federal sources
to increase wages and benefits under such programs, if appropriate.
"SEC. 457. DEFINrnONS.

"For purposes of this subtitle:
"(1) ADJUSTED INCOME.—^The term 'acyusted income' has
the meaning given the term in section 3(b) of the United
States Housing Act of 1937.
"(2) APPLICANT.—^The term 'applicant' means a public or
private nonprofit agency, including—
"(A) a community-based organization;
"(B) an administrative entity designated under section
103(bXlXB) of the Job Training Partnership Act;
"(C) a community action agency;
"(D) a State and local housing development agency;
"(E) a community development corporation;
"(F) a State and local youth service and conservation
corps; and
"(G) any other entity eligible to provide education and
employment training under other Federal employment
training programs.
"(3) COMMUNITY-BASED ORGANIZATION.—The term 'community-based organization' means a private nonprofit organization
thatr-

42 USC 12899f.

106 STAT. 3732

PUBLIC LAW 102-550—OCT. 28, 1992
"(A) maintains, through significant representation on
the organization's governing board or otherwise, accountability to low-income community residents and, to the
extent practicable, low-income beneficiaries of programs
receiving assistance imder this subtitle; and
"(B) has a history of serving the local community or
communities where a program receiving assistance under
this subtitle is located.
"(4) HOMELESS INDIVIDUAL.—The term ^homeless individual*
has the meaning given the term in section 103 of the Stewart
B. McKinney Homeless Assistance Act.
"(5) HOUSING DEVELOPMENT AGENCY.—The term *housing
development agency* means any agency of a State or local
government, or any private nonprofit organization that is
engaged in providing housing for homeless or low-income
families.
"(6) INCOME.—^The term 'income* has the meaning given
the term in section 3(b) of the United States Housing Act
of 1937.
"(7) INDIAN TRIBE.—The term 'Indian tribe* has the same
meaning given such term in section 102(aX17) of the Housing
and Community Development Act of 1974 (42 U.S.C.
5302(aX17)).
"(8) INDIVIDUAL WHO HAS DROPPED OUT OF HIGH SCHOOL.—

The term 'individual who has dropped out of high school* means
an individual who is neither attending any school nor subject
to a compulsory attendance law and who has not received
a secondary school diploma or a certificate of equivalency for
such diploma.
"(9) INSTITUTION OF HIGHER EDUCATION.—The term 'institution of higher education' has the meaning given the term in
section 1201(a) of the Higher Education Act of 1965.
"(10) LIMITED-ENGLISH PROFICIENCY.—The term 'limitedEnglish proficiency has the meaning given the term in section
7003 of the Bihngual Education Act.
"(11) LOW-INCOME FAMILY.—The term low-income famil/
has the meaning given the term in section 3(b) of the United
States Housing Act of 1937.
"(12) OFFENDER.—^The term 'offender* means any adult or
juvenile with a record of arrest or conviction for a criminal
offense.
"(13) QUALIFIED NONPROFIT AGENCY.—The term 'qualified
public or private nonprofit agency* means any nonprofit agency
that has significant prior experience in the operation of projects
similar to the Youthbuild program authorized under this subtitle and that has the capacity to provide effective technical
assistance.
"(14) RELATED FACILITIES.—^The term 'related facilities'
includes cafeterias or dining halls, community rooms or buildings, appropriate recreation facilities, and other essential service facilities.
"(15) SECRETARY.—^The term 'Secretary* means the Secretary of Housing and Urban Development.
"(16) STATE.—^The term 'State' means any of the several
States, the District of Columbia, the Commonwealth of Puerto
Rico, the Commonwealth of the Northern Mariana Islands,
the Virgin Islsuids, Guam, American Samoa, the Trust Terri-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3733

tories of the Pacific Islands, or any other territory or possession
of the United States.
"(17) TRANSITIONAL HOUSING.—The term 'transitional housing* means a project that has as its purpose facilitating the
movement of homeless individuals and families to independent
living within a reasonable amount of time. Transitional housing
includes housing primarily designed to serve deinstitutionalized
homeless individuals and other nomeless individuals with mental or physical disabilities and homeless families with children.
"(18) VERY LOW-INCOME FAMILY.—^The term Very lowincome family* has the meaning given the term in section
3(b) of the United States Housing Act of 1937.
"(19) YOUTHBUILI) PROGRAM.—The term Touthbuild program' means any program that receives assistance under this
subtitle and provides disadvantaged youth with opportunities
for employment, education, leadership development, and training in the construction or rehabilitation of housing for homeless
individuals and members of low- and very low-income families.
'^EC. 4S8. MANAGEMENT AND TECHNICAL ASSISTANCE.
42 USC 12899g.
"(a) SECRETARY ASSISTANCE.—The Secretary may enter into
contracts with a qualified public or private nonprofit agency to
provide assistance to the Secretary in the management, supervision,
and coordination of Youthbuild programs receiving assistance under
this subtitle.
"(b) SPONSOR ASSISTANCE.—The Secretary shall enter into con- Contracts.
tracts with a qualified public or private nonprofit agency to provide
appropriate training, information, and technical assistance to sponsors of programs assisted under this subtitle.
"(c) APPLICATION PREPARATION.—Technical assistance may also
be provided in the development of program proposals and the
preparation of applications for assistance under this subtitle to
eligible entities which intend or desire to submit such applications.
Community-based organizations shall be given first priority in the
provision of such assistance.
"(d) RESERVATION OF 1<\JNDS.—In each fiscal year, the Secretary
shall reserve 5 percent of the amounts available for activities luider
this subtitle pursuant to section 402 to carry out subsections (b)
and (c) of this section.
•«EC. 459. CONTRACTS.

42 USC 12899h.

"Each Youthbuild program shall carry out the services and
activities under this subtitle directly or through arrangements or
imder contracts with administrative entities designated under section 103(bXlXB) of the Job Training Partnership Act, with State
and local educational agencies, institutions of higher education.
State and local housing development agencies, or with other public
agencies, including agencies of Indian tribes, and private
organizations.
"SEC 460. REGULATIONS.

"The Secretary shall issue any regulations necessary to carry
out this subtitle.".
SEC 165. EXTENSION FOR COMMENCEMENT OF CERTAIN CONSTRUCTION.
Notwithstending section 17(dX4XG) of the United States Housing Act of 1937, the Secretary of Housing and Urban Development

42 USC 128991.

106 STAT. 3734

PUBLIC LAW 102-550—OCT. 28, 1992

shall extend the deadline for commencement of construction until
September 30, 1993, for the application for assistance under such
section 17 for HDG project number IL004HG702, and upon
commencement of construction shall execute the grant agreement
for such project as currently approved or amended.

Subtitle E—^Homeownership Programs
SEC. 181. HOPE PROGRAMS.
(a) AUTHORIZATION OF
ASSISTANCE.—

APPROPRIATIONS

AND TECHNICAL

(1) IN GENERAL.—Title IV of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12871 et seq.)
is amended by inserting after section 401 the following new
section:
42 u s e 12870.

"SEC. 402. AUTHORIZATION OF APPROPRIATIONS.

"(a) FISCAL YEAR 1993.—There are authorized to be appropriated for grants under this title $855,000,000 for fiscal year
1993, of which—
"(1) $285,000,000 shall be available for activities authorized
under title III of the United States Housing Act of 1937, of
which up to $4,500,000 of any amounts appropriated may be
made available for technical assistance to potential applicants,
applicants and recipients of assistance under this title;
"(2) $285,000,000 shall be available for activities authorized
under subtitle B, of which up to $3,250,000 of any amounts
appropriated may be made available for technical assistance
to potential applicants, applicants and recipients of assistance
under this subtitle; and
"(3) $285,000,000 shall be available for activities under
subtitle C, of which up to $2,250,000 of any amounts appropriated may be made available for technical assistance to potential appUcants, applicants and recipients of assistance under
this subtitle.
Of the amounts appropriated pursuant to this subsection, up to
$40,000,000, but not less than 5 percent, shall be available for
activities authorized under subtitle D. Any amount appropriated
pursucuit to this subsection shall remain available until expended.
"(b) FISCAL YEAR 1994.—There are authorized to be appropriated for grants under this title $883,641,000 for fiscal year
1994, of which—
"(1) $294,547,000 shall be available for activities authorized
under title III of the United States Housing Act of 1937, up
to $4,500,000 of which may be made available for technic^d
assistance to potential applicants, applicants and recipients
of assistance under this title;
"(2) $294,547,000 shall be available for activities authorized
under subtitle B, up to $3,250,000 of which may be made
available for technical assistance to potential applicants,
applicants and recipients of assistance under this subtitle; and
"(3) $294,547,000 shall be available for activities imder
subtitle C, up to $2,250,000 of which may be made available
for technical assistance to potential applicants, applicants and
recipients of assistance under this subtitle.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3735

Of the amounts appropriated pursuant to this subsection, up to
$41,680,000, but not less than 5 percent, shall be available for
activities authorized uiider subtitle D. Any amount appropriated
pursuant to this subsection shall remain available until expended.
"(c) TECHNICAL ASSISTANCE.—^Technical assistance made available under title III of the United States Housing Act of 1937
or subtitle B or subtitle C of this title may include, but shall
not be limited to, training, clearinghouse services, the collection,
processing and dissemimation of program information useful for
local and national program management, and provision of seed
money. Such technical assistance may be made available directly,
or indirectly under contracts and grants, as appropriate. In any
fiscal year, no single applicant, potential applicant, or recipient
under title III of the United States Housing Act of 1937, or subtitle
B or subtitle C of this title may receive technical assistance in
an amount exceeding 20 percent of the total amount made available
for technicsd assistimce! under such title or subtitle for the fiscal
year.**.
(2) CONFORMING AMENDMENTS.—

(A) HOPE I,.—Section 301 of the United States Housing
Act of 1937 (42 U.S.C. 1437aaa(c)) is amended by striking
subsection (c).
(B) HOPE n AND HOPE IIL—Title IV of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12871
et seq.) is amended—
(i) by striking subsection (c) of section 421; and 42 u s e 12871.
(ii) in section 441—
42 u s e 12891.
(I) by striking "(a) IN GENERAL.—**; and
(II) by striking subsection (b).
(3) GAO AUDrr OF TECHNICAL ASSISTANCE CONTRACTS.—

42 u s e 12870

The Comptroller General of the United States shall conduct note.
an audit of all of the technical assistance contracts awarded
for fiscal years 1993 and 1994 pursiiant to section 402 of
the Cranston-Cjonzalez National Affordable Housing Act. The Reports.
Comptroller (general shall submit a report to the Congress
describing the results of such audit not later than September
30,1994.
(b) HOPE I MATCHING FUNDING.—Section 303(c) of the United
States Housing Act of 1937 (42 U.S.C. 1437aaa-2(c)(l)) is
amended—
(1) in paragraph (1), by inserting £ift«r "expenses** the following: "and replacement housing"; and
(2) by inserting at the end the following new paragraph:
"(3) REDUCTION OF REQUIREMENT.—The Secretary shall

reduce the matching requirement for homeownership programs
carried out imder this section in accordance with the formida
established under section 22(Xd) of the Cranston-Gonzalez
National Affordable Housing Act.**.
(c) GRANT SELECTION CRITERIA FOR HOPE I.—Section 303(eX8)
of the United States Housing Act of 1937 (42 U.S.C. 1437aaa2(e)(8)) is amended—
(1) by striking "of the tjT)e assisted under this title**; and
(2) by striking "appreciabijr**.
(d) EUGIBILITY OF MUTUAL HOUSING ASSOCIATIONS FOR HOPE
II GRANTS.—Section 426(1) of the Cranston-Gonzalez National
Affordable Housing Act (42 U.S.C. 12876(1)) is amended by adding
at the end the following new subparagraph:

59-194 0 - 9 3

4 : QL 3 (Pt. 5)

106 STAT. 3736

PUBLIC LAW 102-550—OCT. 28, 1992

"(G) A mutual housing association.".
(e) EuGiBLE PROPERTY UNDER HOPE IL—Section 426(3XD)
of the Cranston-Gonzalez National Affordable Housing ^^t (42
U.S.C. 12876(3XD)) is amended by inserting before the period at
the end the following "or an agency or instrumentality thereof^.
(f) PREFERENCE FOR ACQUISITION OF VACANT UNITS UNDER

HOPE III.—Section 444 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12894) is amended by adding at the
end the following new subsection:
"(f) PREFERENCE FOR ACQUISITION OF VACANT UNITS.—Each

homeownership program under this subtitle shall provide that,
in making vacant units in eUgible properties available for acquisition by ehgible families, preference shall be given to eligible families
who reside in public or Indian housing.".
(g) TRANSFER OF SCATTERED SITE P U B U C AND INDIAN HOUSING

To HOPE PROGRAMS.—
(1) HOPE L —

42 use
l437aaa-2.

(A) I N GENERAL.—Sections 303(bX2) and 304(d) of the
United States Housing Act of 1937 (42 U.S.C. 1437aaa2(bX2) and 42 U.S.C. 1437aaa-3(d)) are each amended
by striking "(not including scattered site single family housing of a public housing agency)".
(B) OPERATING SUBSIDIES.—Section 303(bX9) of the
Cranston-Cjronzalez National Affordable Housinjg Act (42
U.S.C. 1437aaa-2(bX9)) is amended Inr inserting before
the period at the end the following: , and except that
implementation grants may not be used under this paragraph to fund operating expenses for scattered site public
Housing acquirea under a homeownership program".
(2) HOPE HI.—Section 446(4) of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12896(4)) is
amended by striking "(including scattered site single family
properties, and" and inserting "(excluding public or Indian
nousing under the United States Housing Act of 1937 and
including".
(h) EUGIBILITY OF OTHER FEDERAL PROPERTY FOR HOPE PROGRAMS.—-Sections 426(3XD) and 446(4) of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12876(3XD) and 42
U.S.C. 12896(4)) are each amended by inserting after "Corporation,"
the following: '%he Federal Deposit Insurance Corporation, the Secretary of Defense, the Secretary of Transportation, the General
Services Administration, any other Federal agency,".
SEC. 182. NATIONAL HOMEOWNERSHIP TRUST DEMONSTRATION.
(a) EXTENSION OF TRUST.—Section 310 of the Cranston-Gronzalez National Affordable Housing Act (42 U.S.C. 12859) is amended
by striking "on September 30, 1993" and inserting "September
30,1994".
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 308

of

the

Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
12857) is amended to read as follows:
••SEC. 308. AUTHORIZATION OF APPROPRIATIONS.
"There are authorized to be appropriated for assistance payments under this subtitle $520,665,600 for fiscal year 1993 and
$542,533,555 for fiscal year 1994, of which such sums as may
be necessary shall be available in each such fiscal year for use
under section 303(e). Any amount appropriated under this section

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3737

shall be deposited in the Fund and shall remain available until
expended, subject to the provisions of section 311.".
(c) U S E OF TRUST AMOUNTS IN CONNECTION WITH MORTGAGE
REVENUE BONDS.—

(1) IN GENERAL.—Section 303 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12852) is amended
by adding at the end the following new subsection:
"(e) ASSISTANCE IN CONNECTION WITH HOUSING FINANCED WITH
MORTGAGE REVENUE BONDS.—

"(1) AUTHORTTf.—^The Trust shall provide assistance for
first-time homebuyers in the form of interest rate buydowns
and downpayment assistance under this subsection. Such
assistance shall be: available only with respect to mortgages
for the purchase of residences (A) financed with the proceeds
of a qualified mortg;age bond (as such term is defined in section
143 of the Internal Revenue Code of 1986), or (B) for which
a credit is allowable under section 25 of such Code.
"(2) ELIGIBILITY.—^To be eligible for assistance imder this
subsection, homebuyers and mortgages shall also meet the
requirements under subsection (b) of this section, except that—
"(A) the certification under subsection (bX3) shall not
be required for assistance under this subsection;
"(B) the provisions of subsection (bX2) shall not apply
to assistance under this section; and
"(C) the aggregate income of the homebuyer and the
members of the family of the homebuyer residing with
the homebuyer, for the 12-month period preceding the date
of the application of the homebuyer for assistance under
this subsection, shall not exceed 80 percent of the median
income for a family of 4 persons (as adjusted for family
size) in the applicable metropolitan statistical area.
"(3) LIMITATION OF ASSISTANCE.—Notwithstanding subsection (a), assistance payments for first-time homebuyers
under this subsection shall be provided in the following
manners:
"(A) INTEREST RATE BUYDOWNS.—^Assistance payments
to decrease the rate of interest payable on the mortgages
by the homebuyers, in an amount not exceeding—
"(i) in the first year of the mortgage, 2.0 percent
of the total principal obligation of the mortgage;
"(ii) in the second year of the mortgage, 1.5 percent
of the total principal obligation of the mortgage;
"(iii) in the third year of the mortgage, 1.0 percent
of the total principal obligation of the mortgage; and
"(iv) in the fourth year of the mortgage, 0.5 percent
of the total principal obligation of the mortgage.
"(B) DOWNPAYMENT ASSISTANCE.—Assistance payments
to provide amounts for downpayments on mortgages by
the homebuyers, in an amount not exceeding 2.5 percent
of the principal obligation of the mortgage.
"(3) AVAILABILITY.—^The Trust may make assistance payments under subparagraphs (A) and (B) of paragraph (3) with
respect to a single mortgage of a homebuyer. .
(2) CONFORMING AMENDMENT.—Section 303(a) of the Cran-

ston-(jk)nzalez National Affordable Housing Act (42 U.S.C.
12852(a)) is amended by adding at the end the following new
paragraph:

106 STAT. 3738

PUBLIC LAW 102-550—OCT. 28, 1992
"(3) ASSISTANCE IN CONNECTION WITH MORTGAGE REVENUE

BONDS FINANCING.—Interest rate buydowns and downpayment
assistance in the manner provided in subsection (e).".
(d) EuGiBiUTY OF MANUFACTURED HOME OWNERS.—Section
303(bXl) of the Cranston-Gronzalez National Affordable Housing
Act (42 U.S.C. 12852(bXl)) is amended—
(1) in subparagraph (B), by striking "or" at the end;
(2) in subparagraph (C), by striking the period at the
end and inserting "; or"; and
(3) by adding at the end the following new subparagraph:
"(D) meets the requirements of subparagraph (A), (B),
or (C), except for owning, as a principal residence, a dwelling unit whose structure is—
"(i) not permanently siffixed to a permanent
foundation in accordance with local or other applicable
regulations; or
"(ii) not in compliance with State, local, or model
building codes, or other applicable codes, and cannot
be brought into compliance with such codes for less
than the cost of constructing a permanent structure.".
(e) SECOND MORTGAGE ASSISTANCE.—Section 303(a) of the

Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
12852(a)) is amended by adding after paragraph (3) (as added
by subsection (cX3) of tins section) the following new paragraphs:
"(4) SECOND MORTGAGE ASSISTANCE.—^Assistance payments
to provide loans (secured by second mortgages) with deferred
payment of interest and principal; and
"(5) CAPITALIZATION OF REVOLVING LOAN FUNDS.—Grants

to public organizations or agencies to establish revolving loan
funds to provide homeownership assistance to eligible firsttime homebuyers consistent with the requirements of this subtitle. Such grants shall be matched by an equal amount of
local investment in such revolving loan fimds. Any proceeds
or repajnnents from loans made under this paragraph shall
be returned to the revolving loan fund established under this
paragraph to be used for purposes related to this section.".
SEC. 183. NEHEMIAH HOUSING OPPORTUNITY GRANTS.
(a) HOMEOWNER INCENTIVE.—Section 604 of the Housing and

12 use 1715/
"ote.

Community Development Act of 1987 (12 U.S.C. 17151 note) is
amended—
(1) in subsection (b)(4), by inserting before the period the
following: ", subject to the provisions of subsection (c)"; and
(2) by adding at the end the following new subsection:
"(c) HOMEOWNER INCENTIVE.—^The nonprofit organization may

provide that, upon the sale or transfer of a property purchased
with a loan made under this section, an^ proceeds remaining after
repaying the first mortgage shall be distributed in the following
order:
"(1) DOWNPAYMENT.—The amount of the downpayment
made by the seller or transferor upon the purchase of the
property shall be paid to the seller or transferor.
"(2) LOAN AND PROFIT.—Any amounts remaining after distribution under paragraph (1) shall be shared equally between
the Secretary and the seller or transferor, but only to the
extent that the Secretary recovers an amount equal to the
amount of the loan made under this section. If such remaining

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3739

amounts are insufficient for the Secretary to recover the full
amount of the loan made under this section, the second mortgage held by the Secretary under subsection (bXD shaU be
cancelled.
"(3) PROFIT.—Any amounts remaining after distribution
under paragraphs (1) and (2) shall be paid to the seller or
transferor.".
(b) CONFORMING AMENDMENTS.—Section 606(eX5) of the Housing and Community Development Act of 1987 (12 U.S.C. 17151
note) is amended—
(1) by inserting "subject to the provisions of section 604(c),**
after the comma; and
(2) by striking "(in which case** and all that follows through
"repaid)**.
(c) APPLICABILITY.—The amendments made by this section shall
apply to any loan made imder section 604 of the Housing and
Community Development Act of 1987 after July 1,1990.
SEC. 184. LOAN GUARANTEES FOR INDIAN HOUSING.

(a) AUTHORITY.—^To provide access to sources of private financing to Indian families and Indian housing authorities who otherwise
could not acquire housing financing because of the luiique legal
status of Indian trust land, the Secretary may guarantee not to
exceed 100 percent of the unpaid principal and interest due on
any loan eligible under subsection (b) made to an Indian family
or Indian housing authoirity.
(b) ELIGIBLE LOANS.—Loans guaranteed pursuant to this section shall meet the following requirements:
(1) ELIGIBLE BORROWERS.—^The loans shall be made only
to borrowers who are Indian families or Indian housing
authorities.
(2) ELIGIBLE HOUSING.—The loan shall be used to construct,
acquire, or rehabilitate 1- to 4-family dwellings that are standard housing and are located on trust land or land located
in an Indian or Alaska Native area.
(3) SECURITY.—The loan may be secured by any collateral
authorized imder existing Federal law or applicable State or
tribal law.
(4) LENDERS.—^^The loan shall be made only by a lender
approved by and meeting qualifications established by the Secretary, except that loans otherwise insured or guaranteed by
an agency of the Federal Government or made by an organization of Indians from amounts borrowed from the United States
shall not be eligible for guarantee under this section. The
following lenders are deemed to be approved under this
paragraph:
(A) Any mortgagee approved by the Secretary of Housing and Urban Development for participation in the single
family mortgage insurance program imder title II of the
National Housing Act.
(B) Any lender whose housing loans imder chapter
37 of title 38, United States Code are automatically guaranteed pursuant to section 1802(d) of such title.
(C) Any lender approved by the Secretary of Agriculture to make guaranteed loans for single family housing
imder the Housing Act of 1949.

12 USC 1715/
^°^-

12 use 1715/
"°*®12 USC

106 STAT. 3740

PUBLIC LAW 102-550—OCT. 28, 1992
(D) 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
section 404 and service charges, if any) a t a rate agreed
upon by the borrower and the lender and determined by
the Secretarv to be reasonable, which may not 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
(jovemment;
(C) involve a principal obligation not exceeding—
(i) an amoimt equal to the sum of (I) 97 percent
of $25,000 of the appraised value of the property, as
of the date the loan is accepted for guarantee, and
(II) 95 percent of such value in excess of $25,000;
and
(ii) the amount approved by the Secretory imder
this section; and
(D) involve a payment on accoimt of the property (i)
in cash or ite equivalent, or (ii) through the value of any
improvements to the property made through the skilled
or imskilled labor of the borrower, as the Secretory shall
provide.
(c) CERTIFICATE OF GUARANTEE.—
(1) APPROVAL PROCESS.—Before the Secretory approves any

loan for guarantee under this section, the lender shall submit
the application for the loan to the Secretory for examination.
If the Secretory approves the loan for guarantee, the Secretory
shall issue a certiiicato imder this paragraph as evidence of
the guarantee.
(2) STANDARD FOR APPROVAL.—The Secretory may approve
a loan for guarantee under this section and issue a certificate
under this paragraph only if the Secretory determines there
is a reasonable prospect of repajmient of the loan.
(3) EFFECT.—^A certificate of guarantee issued under this
paragraph by the Secretory shall be conclusive evidence of
the eligibility of the loan for guarantee under the provisions
of this section and the amount of such guarantee. Such evidence
shall be incontestable in the hands of the bearer and the
full faith and credit of the United Stotes is pledged to the
payment of all amounto agreed to be paid by the Secretary
as security for such obligations.
(4) FRAUD AND MISREPRESENTATION.—This subsection may

not be construed to preclude the Secretary from estoblishing
defenses against the original lender based on fraud or material
misrepresentotion or to bar the Secretory from estoblishing
by regulations in effect on the date of issuance or disbursement,
whichever is earlier, partial defenses to the amount payable
on the guarantee.
(d) GUARANTEE FEE.—^The Secretory shall fix and collect a
guarantee fee for the guarantee of loans under this section, which
may not exceed the amount equal to 1 percent of the principal
obligation of the loan. The fee shall be paid by the lender at
time of issuance of the guarantee and shall be adequate, in the

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3741

determination of the Secretary, to cover expenses and probable
losses. The Secretary shall deposit any fees collected under this
subsection in the Indian Housing Loan Guarantee Fund established
under subsection (i).
(e) 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 impaid obligation under the provisions of the loan
agreement.
(0 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.
(g) DISQUALIFICATION
PENALTIES.—

OF

LENDERS

AND

CIVIL

MONEY

(1) I N GENERAL.—^If the Secretary determines that any
lender or holder of a guarantee certificate under subsection
(c) has failed to maintain adequate accounting records, to adequately service loans guaranteed under this section, 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—
(A) refuse, either temporarily or permanently, to
guarantee any further loans made by such lender or holder;
(B) bar such lender or holder from acquiring additional
loans guaranteed under this section; and
(C) reqmre 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.—

If the Secretary determines that any lender or holder of a
guarantee certificate iinder subsection (c) has intentionally
failed to maintain adequate accounting records, to adequately
service loans guaranteed under this section, or to exercise
proper credit or underwriting judgment, the Secretary may
impose a civil money penalty on such lender or holder in
the manner and amount provided under section 536 of the
National Housing Act with respect to mortgagees and lenders
under such Act.
(3) PAYMENT ON LOANS MADE IN GOOD FAITH.—Notwith-

standing paragraphs (1) and (2), the Secretary may not refuse
to pay pursuant to a valid guarantee on loans of a lender
or holder barred under this subsection if the loans were previously made in good faith.
(h) PAYMENT UNDER GUARANTEE.—
(1) LENDER OPTIONS.—

(A) I N GENERAL.—^In the event of default by the borrower on a loan guaranteed under this section, the holder
of the guarantee certificate shall provide written notice
of the default to the Secretary. Upon providing such notice,
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 pajnment in
one of the following manners:

106 STAT. 3742

PUBLIC LAW 102-550—OCT. 28, 1992
(i) FORECLOSURE.—The holder of the certificate
may initiate foreclosure proceedings in a court of competent jurisdiction (after providing written notice of
such action to the Secretary) and 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 (e))
plus reasonable fees and expenses as approved by the
Secretary. The Secretary shall be subrogated to the
rights of the holder of the guarantee and the lender
holder shall assign the obligation and security to the
Secretary.
(ii) No FORECLOSURE.—^Without seeking a judicial
foreclosure (or in any case in which a foreclosure
proceeding initiated under clause (i) continues for a
period in excess of 1 year), the holder of the guarantee
may submit to the Secretary a claim for pa3anent under
the guarantee and the Secretary shall only pay to
such holder for a loss on any single loan an amount
equal to 90 percent of the pro rata portion of the
amount guaranteed (as determined under subsection
(e)). The Secretary shall be subrogated to the rights
of the holder of the guarantee and 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 pa3nnent, 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. The Secretary shall then take such action to collect
as the Secretary determines appropriate.
(2) ASSIGNMENT BY SECRETARY.—Notwithstanding paragraph (1), upon receiving notice of default on a loan guaranteed
luider this section from the holder of the guarantee, the Secretary may accept assignment of the loan if the Secretary
determines that the assignment is in the best interests 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 subsection (e)). The
Secretary shall be subrogated to the rights of the holder of
the guarantee and the holder shall assign the obligation and
security to the Secretary.
(3) LIMITATIONS ON LIQUIDATION.—In the event of a default
by the borrower on a loan guaranteed under this section involving a security interest in tribal allotted or trust land, the
Secretary shall only pursue liquidation after offering to transfer
the account to an eligible tribal member, the tribe, or the
Indian housing authority serving the tribe or tribes. If the
Secretary subsequently proceeds to liquidate the account, the
Secretary shall not sell, transfer, or otherwise dispose of or
alienate the property except to one of the entities described
in the preceding sentence.
(i) INDIAN HOUSING LOAN GUARANTEE FUND.—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3743

(1) ESTABLISHMENT.—There is established in the Treasury
of the United States the Indian Housing Loan Guarantee Fund
for the purpose of providing loan guarantees luider this section.
(2) CREDITS.—^The Guarantee Fund shall be credited with—
(A) any amounts, claims, notes, mortgages, contracts,
and property acquired by the Secretary under this section,
and any collections and proceeds therefrom;
(B) any amounts appropriated under paragraph (7);
(C) any guarantee fees collected under subsection (d);
and
(D) any intcirest or earnings on amoimts invested under
paragraph (4).
(3) USE.—^Amounts in the Guarantee Fund shall be available, to the extent provided in appropriation Acts, for—
(A) fulfilling any obligations of the Secretary with
respect to loans guaranteed under this section, including
the costs (as such term is defined in section 502 of the
Congressional Eludget Act of 1974) 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) pa3dng administrative expenses in connection with
this section; and
(E) reasonable and necessary costs of rehabilitation
and repair to properties that the Secretary holds or owns
pursuant to this section.
(4) iNVESTMENir.—^Any amoiints in the Guarantee Fund
determined by the Secretary to be in excess of amounts currently required to carry out 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 efTective for any fiscal
year only to the extent or in such amounts as are or
have been provided in appropriations Acts for such fiscal
year.
(B)

LIMITATIONS

ON

COSTS

OF

GUARANTEES.—The

authority of the Secretary to enter into commitments to
guarantee loans under this section shall be efTective for
any fiscal year only to the extent that amounts in the
Guarantee Fund are or have been made available in appropriation Acts to cover the costs (as such term is defined
in section 502 of the Congressional Budget Act of 1974)
of such loan guarantees for such fiscal year.
(C) LIMITATION ON OUTSTANDING AGGREGATE PRINCIPAL

AMOUNT.—Subject to the limitetions in subparagraphs (A)
and (B), the Secretory may enter into commitments to
guarantee loans imder this section in each of fiscal years
1993 and 1994 with an aggregate outstending principal

106 STAT. 3744

PUBLIC LAW 102-550—OCT. 28, 1992
amount not exceeding such amount as may be provided
in appropriation Acts for each such year.
(6) LIABILITIES.—All liabilities and obligations of the assets
credited to the Guarantee Fund under para^aph (2XA) shall
be liabilities and obligations of the Guarantee Fund.
(7) AUTHORIZATION OF APPROPRIATIONS.—There are author-

Regulations.

ized to be appropriated to the Guarantee Fund to carry out
this section such sums as may be necessary for fiscal year
1993 and $50,000,000 for fiscal year 1994.
(j) REQUIREMENTS FOR STANDARD HOUSING.—The Secretary
shall, by regulation, establish housing safety and quality standards
for use under this section. Such standards shall provide sufficient
flexibility to permit the use of various designs and materials in
housing acquired with loans guaranteed imder this section. The
standards shall require each dwelling unit in any housing so
acquired t o ^
(1) be decent, safe, sanitary, and modest in size and design;
(2) conform with applicable general construction standards
for the region;
(3) contain a heating system that—
(A) has the capacity to maintain a minimum temperature in the dwelling of 65 degrees Fahrenheit during the
coldest weather in the area;
(B) is safe to operate and maintain;
(C) delivers a imiform distribution of heat; and
(D) conforms to any applicable tribal heating code or,
if there is no applicable tribal code, an appropriate county.
State, or National code;
(4) contain a plumbing system that—
(A) uses a properly installed system of piping;
(B) includes a kitchen sink and a partitional bathroom
with lavatory, toilet, and bath or shower; and
(C) uses water supply, plumbing, and sewage disposal
systems that conform to any applicable tribal code or, if
there is no applicable tribal code, the minimum standards
established by the applicable county or State;
(5) 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
applic£U>le tribal code or, if there is no applicable tribal code,
an appropriate county. State, or National code;
(6) be not less than—
(AXi) 570 square feet in size, if designed for a family
of not more than 4 persons;
(ii) 850 square feet in size, if designed for a family
of not less than 5 and not more than 7 persons; and
(iii) 1020 square feet in size, if designed for a family
of not less than 8 persons, or
(B) the size provided under the applicable locally
adopted standards for size of dwelling units;
except that the Secretary, upon the request of a tribe or Indian
housing authority, may waive the size requirements under this
paragraph; and
(7) conform with the e n e r ^ performance requirements for
new construction established oy the Secretary under section
526(a) of the National Housing ^ t .
(k) DEFINITIONS.—For purposes of this section:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3745

(1) The term "family^ means 1 or more persons maintaining
a household, £18 the Secretary shall hy regulation provide.
(2) The term "Guarantee Fund" means the Indian Housing
Loan Guarantee Fimd established imder subsection (i).
(3) The term "Indian" means person recognized as being
Indian or Alaska Native by an Indian tribe, the Federal Government, or any State.
(4) The term "Indian area" means the area within which
an Indian housing authority is authorized to provide housing.
(5) The term Indian housing authority^ means any entity
that—
(A) is authorized to engage in or assist in the development or operation of low-income housing for Indians; and
(B) is established—
(i) by exercise of the power of self-government
of an Indian tribe independent of State law; or
(ii) by operation of State law providing specifically
for housing authorities for Indians, including regional
housing authorities in the State of Alaska.
(6) The term "Secretary" means the Secretary of Housing
and Urban Development.
(7) The term "standard housing" means a dwelling unit
or housing that complies with the requirements established
imder subsection (j).
(8) The term "tribe" means any tribe, band, pueblo, group,
community, or nation of Indians or Alaska Natives.
(9) The term "trust land" means land title to which is
held by the United States for the benefit of an Indian or
Indian tribe or title to which is held by an Indian tribe subject
to a restriction agsdnst alienation imposed by the United States.
SEC. 185. ASSISTANCE UNDER SECTION 8 FOR HOMEOWNERSHIP.

(a) AUTHORITY.—Section 8 of the United States Housing Act
of 1937 (42 U.S.C. 1437f), is amended by adding at the end the
following new subsection:
"(y) HOMEOWNERSHIP OPTION.—
"(1) U S E OF ASSISTANCE FOR HOMEOWNERSHIP.—A family

receiving tenant-based assistance imder this section may
receive assistance for occupancy of a dwelling owned by one
or more members of the family if the family—
"(A) is a first-time homeowner;
"(BXi) participates in the family self-sufficiency program under section 23 of the public housing agency providing the assist^mce; or
"(ii) demonstrates that the family has income from
employment or other sources (other than public assistance),
as determined in accordance with requirements of the Secretary, that is not less than twice the payment standard
established by the public housing agency (or such other
amount as may be established by the Secretary);
"(C) except as provided by the Secretary, demonstrates
at the time the family initially receives tenant-based assistance imder this subsection that one or more adult members
of the family have achieved employment for the period
as the Secretary shall require;
"(D) participates in a homeownership and housing
counseling program provided by the agency; and

106 STAT. 3746

PUBLIC LAW 102-550—OCT. 28, 1992
**(£) meets any other initial or continuing requirements
established by the public housing agency in accordance
with requirements established by tne l^cretary.
"(2) MONTHLY ASSISTANCE PAYMENT.—

"(A) I N GENERAL.—^Notwithstcmding any other provisions of this section governing determination of the amount
of assistance payments under this section on behalf of
a family, the monthly assistance payment for any family
assisted under this subsection shall be the amount by
which the fair market rental for the area established under
subsection (cXD exceeds 30 percent of the family's monthly
adjusted income; except that the monthly assistance payment shall not exceed the amoimt by which the monthlv
homeownership expenses, as determined in accordance witn
requirements estabUshed by the Secretary, exceeds 10 percent of the famil/s monthly income.
"(B) EXCLUSION OF EQUITY FROM INCOME.—For purposes of determining the monthly assistance payment for
a family, the Secretaiy shall not include in family income
an amount imputed from the equity of the family in a
dwelling occupied by the family with assistance under this
subsection.
"(3) RECAPTURE OF CERTAIN AMOUNTS.—Upon sale of the
dwelling by the family, the Secretary shall recapture from
any net proceeds the amount of additional assistance (as determined in accordance with requirements established by the Secretary) paid to or on behalf of the eligible family as a result
of paragraph (2XB).
"(4) DOWNPAYMENT REQUIREMENT.—Each public housing

agency providing assistance under this subsection shall ensure
that each family assisted shall provide from its own resources
not less than 80 percent of any downpayment in connection
with a loan made for the purchase of a dwelling. Such resoiurces
may include amounts from any escrow account for the family
estabUshed under section 23(d). Not more than 20 percent
of the downpajonent may be provided from other sources, such
as from nonprofit entities and programs of States and units
of general local government.
"(5) INELIGIBIUTY UNDER OTHER PROGRAMS.—A family m a y

not receive assistance under this subsection during any period
when assistance is being provided for the family under other
Federal homeownership assistance programs, as determined
by the Secretary, inclumng assistance under the HOME Investment Partnerships Act, the Homeownership and Opportunity
Through HOPE Act, title II of the Housii^ and Community
Development Act of 1987, and section 502 of the Housing Act
of 1949.
"(6) INAPPUCABIUTY OF CERTAIN PROVISIONS.—Assistance
under this subsection shall not be subject to the requirements
of the following provisions:
"(A) Subsection (cX3XB) of this section.
"(B) Subsection (dXlXBXi) of this section.
"(C) Any other provisions of this section governing
maximum amounts payable to owners and amounts payable
by assisted families.
"(D) Any other provisions of this section concerning
contracts between public housing agencies and owners.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3747

"(E) Any other provisions of this Act that are inconsistent with the provisions of this subsection.
"(7) REVERSION TO RENTAL STATUS.—

"(A) FHA-INSURED MORTGAGES.—If a family receiving

assistance under this subsection for occupancy of a dwelling
defaults under a mortgage for the dwelling insured by
the Secretary under the National Housing Act, the family
may not continue to receive rental assistance under this
section unless the family (i) transfers to the Secretary
marketable title to the dwelling, (ii) moves from the dwelling within the period established or approved by the Secretary, and (iii) agrees that any amoimts the family is
required to pay to reimburse the escrow account under
section 23(d)(3) may be deducted by the public housing
agency from the assistance payment otherwise payable on
behalf of the family.
"(B) OTHER MORTGAGES.—If a family receiving assistance under this subsection defaults under a mortgage not
insured imder the National Housing Act, the family may
not continue to receive rental assistance under this section
unless it complies with requirements established by the
Secretary.
"(C) ALL MORTGAGES.—^A family receiving assistance
under this subsection that defaults under a mortgage may
not receive assistance under this subsection for occupancy
of another dwelling owned by one or more members of
the family.
"(8) DEFINITION OF FIRST-TIME HOMEOWNER.—For purposes

of this subsection, the term 'first-time homeowner* means—
"(A) a family, no member of which has had a present
ownership interest in a principal residence during the 3
years preceding the date on which the family initially
receives assistance for homeownership under this subsection; and
"(B) any other family, as the Secretary may prescribe.".
(b) FAMILY SELF-SUFFICIENCY PROGRAM.—Section 23(d) of the

United States Housing Act of 1937 (42 U.S.C. 1437u) is amended
by adding at the end the following new paragraph:
(3) U S E OF ESCROW SAVINGS ACCOUNTS FOR SECTION S

HOMEOWNERSHIP.—Notwithstanding paragraph (3), a family
that uses assistance under section 8(y) to purchase a dwelling
may use up to 50 percent of the amount in its escrow account
established under paragraph (3) for a downpajrment on the
dwelling. In addition, after the family purchases the dwelling,
the family may use any amounts remaining in the escrow
account to cover the costs of major repair and replacement
needs of the dwelling. If a family defaults in connection with
the loan to purchase a dwelling and the mortgage is foreclosed,
the remaining amounts in the escrow accoiuit shall be recaptured by the Secretary.".
(c) U S E OF F H A INSURANCE W I T H SECTION 8 HOMEOWNERSHIP.—

(1) I N GENERAI..—Section 203 of the National Housing Act
(12 U.S.C. 1709) is amended—
(A) in the matter preceding subparagraph (A) in subsection (c)(2), by inserting "or of the General Insurance
Fund pursuant to subsection (v)" after "Fund"; and

~^

106 STAT. 3748

PUBLIC LAW 102-550—OCT. 28, 1992

^

(B) by adding at the end the following new subsection:
**(v) Notwithstanding section 202 of this title, the insurance
of a mortgage under this section in connection with the assistance
provided under section 8(y) of the United States Housing Act of
1937 shall be the obligation of the General Insurance Fund created
pursuant to section 519 of this title. The provisions of subsections
(a) through (h), (j), and (k) of section 204 shall apply to such
mortgages, except that (1) all references in section 204 to the
Mutual Mortgage Insurance Fund or the Fund shall be construed
to refer to the General Insurance Fund, and (2) any excess amounts
described in section 204(f)(1) shall be retained by the Secretary
and credited to the General Insurance Fund.".
(2) GENERAL INSURANCE FUND.—Section 519(e) of the
National Housing Act (12 U.S.C. 1735c(e)) is amended by inserting after "203(b)" the following: "(except as provided in section
203(v))".
(3)

MORTGAGE INSURANCE TRANSITION

PREMIUMS.—The

matter preceding paragraph (1) in section 2103(b) of the Omnibus Budget Reconcihation Act of 1990 (12 U.S.C. 1709 note)
is amended by inserting "or of the General Insurance Fund
pursuant to section 203(v) of the National Housing Act" aftier
"Fund".
(4) CONFORMING AMENDMENT.—The third sentence of section 3(a)(1) of the United States Housing Act of 1937 (42
U.S.C. 1437a(a)(l)) is amended by inserting "or (y) or paying
rent under section 8(c)(3)(B)" after "section 8(o)".
Disadvantaged.
42 u s e 12898a.

SEC. 186. ENTERPRISE
GRANTS.

ZONE

HOMEOWNERSHIP

OPPORTUNITY

(a) STATEMENT OF PURPOSE.—It is the purpose of this section—
(1) to encourage homeownership by families in the United
States who are not otherwise able to aftbrd homeownership;
(2) to encourage the redevelopment of economically
depressed areas; and
(3) to provide better housing opportunities in federally
approved and equivalent State-approved enterprise zones.
(b) DEFINITIONS.—For purposes of this section the following
definitions shall apply:
(1) HOME.—^The term "home" means any 1- to 4-family
dwelling. Such term includes any dwelling unit in a condominium project or cooperative project consisting of not more than
4 dwelling units, any town house, and any manufactured home.
(2) METROPOLITAN STATISTICAL AREA.—^The term "metropolitan statistical area" means a metropolitan statistical area
as established by the Oftlce of Management and Budget.
(3) NONPROFIT ORGANIZATION.—The term "nonprofit
organization" means a private nonprofit corporation, or other
private nonprofit legal entity, that is approved by the Secretary
as to financial responsibility.
(4) SECRETARY.—^The term "Secretary" means the Secretary
of Housing and Urban Development.
(5) STATE.—^The term "State" means each of the several
States, the District of Columbia, the Commonwealth of Puerto
Rico, the Virgin Islands, Guam, American Samoa, the Northern
Mariana Islands, the Trust Territory of the Pacific Islands,
. and any other territory or possession of the United Stetes.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3749

(6) U N I T OF GENERAL LOCAL GOVERNMENT.—The term "unit
of general local government" means any borough, city, county,
parish, town, township, village, or other general purpose political subdivision of a State.
(c) ASSISTANCE TO NONPROFIT ORGANIZATIONS.—

(1) I N GENERAL.—^The Secretary may provide assistance
to nonprofit organizations to carry out enterprise zone
homeownership opportunity programs to promote homeownership in federally approved and equivalent State-approved enterprise zones in accordance with the provisions of this section.
Such assistance shall be made in the form of grants.
(2) APPLICATIONS.—^Applications for assistance under this
section shall be made in such form, and in accordance with
such procedures, as the Secretary may prescribe.
(d) ELIGIBLE U S E S OF ASSISTANCE.—

(1) I N GENERAL.—^Any nonprofit organization receiving
assistance under this section shall use such assistance to provide loans to families purchasing homes constructed or rehabilitated in accordance with an enterprise zone homeownership
opportunity program approved under this section.
(2) SPECIFIC RE;QUIREMENTS.—Each loan made to a family
under this subsection shall—
(A) be secured by a second mortgage held by the Secretary on the property involved;
(B) be in an amount not exceeding $15,000;
(C) bear no interest; and
(D) be repayable to the Secretary upon the sales, lease,
or other transfer of such property.
(e) PROGRAM REQUIIEIEMENTS.-

(1) IN GENERAL.—^Assistance provided under this section
may be used onl}^ in connection with an enterprise zone
homeownership opportunity program of construction or
rehabilitation of homes.
(2) FAMILY NEED.—Each family purchasing a home under
this section shall—
(A) have a family income on the date of such purchase
that is not more than the median income for a family
of 4 persons (adjusted for family size) in the metropolitan
statistical area in which a federally approved or equivalent
State-approved enterprise zone is located; and
(B) not have owned a home during the 3-year period
preceding such purchase.
(3) DOWNPAYMENT.—Each family purchasing a home imder
this section shall make a downpajrment of not less than 5
percent of the sale price of such home.
(4) LEASING PROHIBITION.—No family purchasing a home
under this section may lease such home.
(f) TERMS AND CONDITIONS OF ASSISTANCE.—
(1) LOCAL CONSULTATION.—No proposed enterprise zone

homeownership opportunity program may be approved by the
Secretary imder this section vmless the applicant involved demonstrates to the satisfaction of the Secretary that—
(A) it has consulted with and received the support
of residents of the neighborhood in which such program
is to be located; and
(B) it has the approval of each unit of general local
government in which such program is to be located.

106 STAT. 3750

PUBLIC LAW 102-550—OCT. 28, 1992
(2) PROGRAM SCHEDULE,—Each applicant for assistance
under this section shall submit to the Secretary an estimated
schedule for completion of its proposed enterprise zone
homeownership opportunity program, which schedule shall
have been agreed to by each unit of general local government
in which such program is to be located.
(3) LOCATION.—^All homes constructed or rehabilitated
under such program will be located in federally approved or
equivalent State-approved enterprise zones.
(4) SALES CONTRACTS.—Sales contracts entered into xmder
such program will contain provisions requiring repayment of
any loan made under this section upon the sale or otner transfer
of the home involved, unless the Secretary approves a transfer
of such home without repayment (in which case the second
mortgage held by the Secretary on such home shall remain
in force until such loan is fully repaid).
(g) PROGRAM SELECTION CRITERIA.—

Appropriation
authorization.

(1) I N GENERAL.—In selecting enterprise zone homeownership opportunity programs for assistance under this section
from among eligible programs, the Secretary shall make such
selection on the basis of the extent to which—
(A) non-Federal public or private entities will contribute land necessary to make each program feasible;
(B) non-Federal public and private financial or other
contributions (including tax abatements, waivers of fees
related to development, waivers of construction, development, or zoning requirements, and direct financial contributions) will reduce the cost of home constructed or
rehabilitated under each program;
(C) each program will produce the greatest number
of units for the least amount of assistance provided under
this section, taking into consideration the cost differences
among different market areas; and
(D) each program provides for the involvement of local
residents in the planning, and construction or rehabilitation, of homes.
(2) EXCEPTION.—To the extent that non-Federal public entities are prohibited by the law of any State from making any
form of contribution described in subparagraph (A) or (B) of
paragraph (1), the Secretary shall not consider such form of
contribution in evaluating such program.
(h) REGULATIONS.—Not later than 180 days aft;er the date of
enactment of this section, the Secretary shall issue final regulations
to carry out the provisions of this title. Any such regulations shall
be issued in accordance with section 553 of title 5, United States
Code, notwithstanding the provisions of subsection (a)(2) of such
section.
(i) FUNDING.—^There are authorized to be appropriated to carry
out this section $30,000,000 in each of fiscal years 1993 and 1994.

Subtitle F—Implementation
Regulations.
42 u s e 1437a
note.

SEC. 191. IMPLEMENTATION.

The Secretary of Housing and Urban Development shall issue
any final regulations necessary to implement the provisions of this
title and the amendments made by this title not later than the

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3751

expiration of the 180-day period beginning on the date of the enactment of this Act, except as expressly provided otherwise in this
title and the amendments made by this title. Such regulations
shall be issued after notice and opportunity for public comment
pursuant to the provisions of section 553 of title 5, United States
Code (notwithstanding subsections (a)(2), (b)(B), and (d)(3) of such
section).

TITLE II—HOME INVESTMENT
PARTNERSHIPS
SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

Section 205 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12724) is amended to read as follows:
-SEC. 205. AUTHORIZATION.

'There are authorized to be appropriated to carry out this
title $2,086,000,000 for fiscal year 1993, and $2,173,612,000 for
fiscal year 1994, of which—
"(1) not more than $14,000,000 for fiscal year 1993, and
$14,000,000 for fiscal year 1994, shall be for community housing
partnership activities authorized under section 233; and
"(2) not more than $11,000,000 for fiscal year 1993, and
$11,000,000 for fiscal year 1994, shall be for activities in support of State and local housing strategies authorized imder
subtitle C".
SEC. 202. HOME PROGRAM THRESHOLDS.
(a) PARTICIPATING JURISDICTIONS.—Section 216 of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12746) is
amended—
(1) in paragraph (3), by striking "A jurisdiction" and inserting "Except as provided in paragraph (10), a jurisdiction";
(2) in paragraph (9)(B), by inserting ", except as provided
in paragraph (10)" after "in any 1 year"; and
(3) by adding at the end the following:
"(10) THRESHOLD REDUCTION.—If the amount appropriated
pursuant to section 205 for any fiscal year is less than
$1,500,000,000, then this section shall be applied during that
year—
"(A) by substituting '$500,000' for '$750,000' both places
it appears in paragraph (3); and
"(B) by substituting '$500,000', '$410,000', and
'$335,000' for '$750,000', '$625,000', and '$500,000', respectively, where they appear in paragraph (9).".
(b) SUPPLEMENTAL ALLOCATION.—Section 217(b) of the Cranston-Gonzalez National Afi^ordable Housing Act (42 U.S.C. 12747(b))
is amended—
(1) in paragraph (3), by inserting ", except as provided
in paragraph (4)" before the period at the end of the second
sentence; and
(2) by adding at the end the following:
"(4) THRESHOLD REDUCTION.—If the amount appropriated
pursuant to section 205 for any fiscal year is less than
$1,500,000,000, then this section shall be applied during that

106 STAT. 3752
42 use 12746
"°**

PUBLIC LAW 102-550—OCT. 28, 1992

year by substituting '$335,000' for '$500,000' where it appears
in paragraph (3).".
(c) APPLICABILITY.—^Notwithstanding any other provision of law,
the grant thresholds provided for in section 216, as amended by
this section, and the grant thresholds provided for in section 217(b)
of the Cranston-Gonzalez National Affordable Housing Act, as
amended by this section, shall apply.
SEC. 203. ELIMINATION OF RESTRICTIONS ON NEW CONSTRUCTION.
(a) ELIGIBLE U S E S OF INVESTMENT.—Section 212(a) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12742(a))
is amended—
(1) in the last sentence of paragraph (2), by striking "under
paragraph (3) of this subsection or";
(2) by striking paragraph (3); and
(3) by redesignating paragraph (4) as paragraph (3).
(b) FORMULA ALLOCATION.—Section 217(D)(1) of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12747(b)(1))
is amended—
(1) by striking subparagraph (A);
(2) in subparagraph (D), by striking "Except as provided
in subparagraph (A), the basic formula established under
subparagraph (B)" and inserting 'The basic formula established
under subparagraph (A)";
(3) in subparagraph (E), by striking "formulas in subparagraph (B)" and inserting "formiila in subparagraph (A)";
(4) in subparagraph (F)—
(A) in the first sentence, by striking "subparagraph
(B)" and inserting "subparagraph (A)"; and
(B) by striking the second sentence;
(5) in subparagraph (G), by striking "formulas in subparagraphs (A) and (B)" and inserting "formula in subparagraph
(A)'*; and
(6) by redesignating subparagraphs (B) through (G) (as
amended by this paragraph) as subparagraphs (A) through
(F), respectively.
(c) CONFORMING AMENDMENT.—Section 218(g) of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12748(g))
is amended by striking "Except as provided in section
217(bXl)(A)(ii), if' and inserting "If.
SEC. 204. POUCIES AND PREFERENCE RULES; USE OF TENANT-BASED
RENTAL ASSISTANCE AMOUNTS FOR SECURITY DEPOSITS.
(a) POLICIES AND PREFERENCE RULES.—Section 212(a)(3) of the

Cranston-Gronzalez National Affordable Housing Act (42 U.S.C.
12742(aX3)), as so redesignated by section 203(aX3) of this Act,
is amended by adding at the end the following:
^(E) SECURITY DEPOSIT ASSISTANCE.—A jurisdiction
using funds provided under this subtitle for tenant-based
rental assistance may use such funds to provide loans
or grants to very low- and low-income families for security
deposits for rental of dwelling units. Assistance under this
subparagraph does not preclude assistance under any other
provision of this paragraph.".
(b) SECURITY DEPOSITS.—Section 212(aX3)(A) of the CranstonGronzalez National Affordable
Housing Act (42 U.S.C.
12742(aX4XA)), as so redesignated by section 203(aX3) of this Act,
is amended by striking clause (ii) and inserting the following:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3753

''(ii) the tenant-based rental assistance is provided
in accordance with written tenant selection policies
and criteria that are consistent with the purposes of
providing housing to very low- and low-income families
and are reasonably related to preference rules established under section 6(cX4XA) of the Housing Act of
1937.".
SEC. 206. USE OF HOME FUNDS FOR HOMELESS ASSISTANCE.

Section 212(a)(1) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12742(aXl)) is amended by adding at the
end the following: "For the purpose of this subtitle, the term 'affordable housing* includes permanent housing for disabled homeless
persons, transitional housing, and single room occupancy housing.".
SEC. 206. PER UNIT COST LIMITS.

Section 212(dXl) of the Cranston-Gonzalez National Affordable Regulations.
Housing Act (42 U.S.C. 12742(dXl)) is amended by inserting after
the first sentence the following: "For multifamily housing, such
limits shall not be less than the per unit dollar amount limitations
set forth in section 221(dX3)(ii) of the National Housing Act, as
such limitations may be adjusted in accordance therewith, except
that for purposes of this subsection the Secretary shall, by regulation, increase the per unit dollar amount limitations in any geographical area by an amount, not to exceed 140 percent, that
equals the amount by which the costs of multifamily housing
construction in the area exceed the national average of such costs. .
SEC. 207. ADMINISTRATIVE COSTS AS ELIGIBLE USE OF INVESTMENT.
(a) HOUSING USES.—Section 212(aXl) of the Cranston-Gonzalez

National Affordable Housing Act (42 U.S.C. 12742(aXl)) is amended
by inserting after "organizations," the following: "to provide for
the pa3nnent of reasonable administrative and planning costs, to
provide for the payment of operating expenses of community housing development organizations,".
(b) ELIGIBLE USE.—Section 212 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12742) is amended—
(1) in subsection (c)(1), by inserting "that exceed the
amount specified under subsection (c)" before the comma at
the end;
(2) by redesignating subsections (c), (d) (as amended by
the preceding provisions of this Act), and (e) as subsections
(d), (e), and (^, respectively; and
(3) by inserting after subsection (b) the following:
"(c) ADMINISTRATIVE COSTS.—In each fiscal year, each participating jurisdiction may use not more than 10 percent of the funds
made available under this subtitle to the jurisdiction for such year
for any administrative and planning costs of the jurisdiction in
carrying out this subtitle, including the costs of the salaries of
persons engaged in administering and managing activities assisted
with fluids made available under this subtitle.".
(c) RECOGNITION OF MATCH.—Section 220 of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12750) is
amended—
(1) in subsection (b)(2), by striking "shall" and all that
follows and inserting "may not be recognized for purposes of
subsection (a)."; and
(2) in subsection (c)—

106 STAT. 3754

PUBLIC LAW 102-550—OCT. 28, 1992
(A) by striking paragraph (2); and
(B) by redesignating paragraphs (3), (4), and (5) as
paragraphs (2), (3), and (4), respectively.
(d) LIMITATION ON ADMINISTRATIVE COSTS.—Section 212 of the

Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
12742) is amended by adding at the end the following:
"(g) LIMITATION ON OPERATING ASSISTANCE.—A participating
jurisdiction may not use more than 5 percent of its allocation
imder this subtitle for the pajnnent of operating expenses for
community housing development organizations.".
SEC. 208. AFFORDABLE HOUSING.
(a) RENT CALCULATIONS.—Section 215(a) of the

Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12745(a))
is amended—
(1) in paragraph (IXA) by striking "smaller and larger
families" and inserting "number of bedrooms in the unit";
(2) in paragraph (3), by adding at the end the following:
"The preceding sentence shall not apply with respect to funds
made available under this Act for units that have been allocated
a low-income housing tax credit by a housing credit agency
pursuant to section 42 of the Internal Revenue Code 1986.";
and
(3) in the second sentence of paragraph (3), by striking
"not less than" and inserting "the lesser of the amount payable
by the tenant under State or local law or".
(b) EXCEPTION TO TERMINATION RULE.—Section 215(aXl)(E) of
the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
12745(a)(1)(E)) is amended by inserting after "Act" the following:
", except upon a foreclosure by a lender (or upon other transfer
in lieu of foreclosure) if such action (i) recognizes any contractual
or legal rights of public agencies, nonprofit sponsors, or others
to take actions that would avoid termination of low-income affordability in the case of foreclosure or transfer in lieu of foreclosure,
and (ii) is not for the purpose of avoiding low income affordability
restrictions, as determined by the Secretary".
SEC. 209. H O M E O W N E R S H I P RESALE RESTRICTIONS.

Section 215(b) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12745(b)) is amended by striking paragraph
(4) and inserting the following:
"(4) is subject to resale restrictions that are established
by the participating jurisdiction and determined by the Secretary to be appropriate to—
"(A) allow for subsequent purchase of the property
only by persons who meet the qualifications specified under
paragraph (2), at a price which will—
"(i) provide the owner with a fair return on investment, including any improvements, and
"(ii) ensure that the housing will remain affordable
to a reasonable range of low-income homebuyers; or
"(B) recapture the investment provided under this title
in order to assist other persons in accordance with the
requirements of this subsection, except where there are
no net proceeds or where the net proceeds are insufficient
to repay the full amount of the assistance; and".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3755

SEC. 210. MATCHING REQUIREMENTS.

(a) TIERED CONTRIBUTION.—Section 220(a) of the CranstonGonzalez National Affordable Housing Act (42 U.S.C. 12750(a))
is amended—
(1) in paragraph (1)—
(A) by striking "and" and inserting a comma;
(B) by inserting "and substantial rehabilitation" after
"rehabilitation"; and
(C) by inserting "and" after the semicolon;
(2) in paragraph (2)—
(A) by striking "33" and inserting "30"; and
(B) by striking "substantial rehabilitation; and" and
inserting new construction.";
(3) by striking paragraph (3); and
(4) in the matter preceding para^aph (1), by striking
"affordable housing assisted under this title" and inserting
"housing that qualifies as affordable housing imder this title .
(b) FORM.—Section 220(c) of the Cranston-Gonzalez National
Affordable Housing Act (42 U.S.C. 12750(c)) is amended—
(1) by striking "and" at the end of paragraph (4);
(2) by striking the period at tne end of paragraph (5)
and inserting a semicolon; and
(3) by adding at the end the following:
"(6) up to—
"(A) 50 percent of proceeds from bond financing validly
issued by a State or local government, agency or instrumentality thereof, or political subdivision thereof, and repavable
with revenues derived from a multifamily affordable housing project financed, and
"(B) 25 percent of proceeds from bond financing validly
issued by a State or local government, agency or instrumentality thereof, or political subdivision thereof, and repayable
with revenues derived from a single-family project financed,
but not more than 25 percent of the contribution required
under subsection (a) may oe derived from these sources;
"(7) the reasonable value of any site-preparation and
construction materials and any donated or voluntary labor in
connection with the site-preparation for, or construction or
rehabilitation of, affordable housing; and
"(8) such other contributions to affordable housing as the
Secretary considers appropriate.".
(c) REDUCTION OF REQUIREMENT.—Section 220 of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12750) is
amended by striking subsection (d) and inserting:
"(d) REDUCTION OF REQUIREMENT.—

"(1) IN GENERAL.—^The Secretary shall reduce the matching
requirement under subsection (a) with respect to any fimds
drawn from a jurisdiction's HOME Investment Trust Fund
Account during a fiscal year by—
"(A) 50 percent for a jurisdiction that certifies that
it is in fiscal distress; and
"(B) 100 percent for a jurisdiction that certifies that
it is in severe fiscal distress.
"(2) DEFINITIONS.—For purposes of this section—
"(A) 'fiscal distress' means a jurisdiction other than
a State that satisfies 1 of the distress criteria set forth
in paragraph (3); and

106 STAT. 3756

PUBLIC LAW 102-550—OCT. 28, 1992
"(B) 'severe fiscal distress' means a jurisdiction other
than a State that satisfies both of the distress criteria
set forth in paragraph (3).
**(3) DISTRESS CRITERIA.—^For purposes of a jurisdiction
other than a State certifying that it is distressed, the following
criteria shall apply:
"(A) POVERTY RATE.—^The average poverty rate in the
jurisdiction for the calendar year immediately preceding
the year in which its fiscal year begins was equal to or
greater than 125 percent of the average national poverty
rate during such calendar year (as determined according
to information of the Bureau of the Census).
"(B) PER CAPITA INCOME.—The average per capita

income in the jurisdiction for the calendar year immediately
)receding the year in which its fiscal year begins was
ess than 75 percent of the average national per capita
income during such calendar year (as determined according
to information of the Bureau of the Census).
"(4) STATES.—In determining the degree to which a jurisdiction that is a State is distressed, the Secretary shall take
into consideration the State's fiscal capacity and expenditure
needs as determined by a national organization which compiles
the relevant data.
"(5) WAIVER IN DISASTER AREAS.—If a participating jurisdiction is located in an area in which a declaration of a disaster
pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act is in effect for any part of a fiscal year,
the Secretary may reduce the matching requirement for that
fiscal year imder subsection (a) with respect to any funds
drawn from a jurisdiction's HOME Investment Trust Fund
Account during that fiscal year by up to 100 percent.".
(d) APPLICABILITY.—The amendments made by this section shall
apply with respect to fiscal year 1993 and each fiscal year
thereafter.

{

42 use 12750
""**•

SEC. 211. ASSISTANCE FOR INSULAR AREAS.
(a) REPEAL OF AMENDMENTS MADE BY PUBLIC LAW 102-230.—
(1) DEFINITIONS.—Section 104 of the Cranston-Gonzalez

National Affordable Housing Act (42 U.S.C. 12704) is amended
to read as if the amendments made by section 2 of Public
Law 102-230 (105 Stat. 1720) had not been enacted.
(2) ALLOCATION OF RESOURCES.—Section 217(a) of the Cran-

ston-(jionzalez National Affordable Hoiising Act (42 U.S.C.
12747(a)) is amended—
(A) by striking the first sentence of paragraph (1) and
inserting the following: "After reserving amounts under
paragraph (2) for Indian tribes and after reserving amounts
under paragraph (3) for the insular areas, the Secretary
shall allocate funds approved in an appropriation Act to
carry out this title by formula as provided in subsection
(b).";
(B) by striking paragraph (3) (as added by Public Law
102-229; 105 Stat. 1709);
(C) by striking paragraph (3) (as added by Public Law
102-230; 105 Stat. 1720); and
(D) by adding after paragraph (2) the following:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3757

"(3) INSULAR AREAS.—^For each fiscal year, of any amounts
approved in appropriation Acts to carry out this title, the Secretary shall reserve for grants to the insular areas the greater
of (A) $750,000, or (B) 0.2 percent of the amounts appropriated
under such Acts. The Secretary shall provide for the distribution of amounts reserved under this paragraph among the
insular areas pursu£uit to specific criteria for such distribution, which shall be contained in a regulation issued by the
Secretary.".
(3) EXPEDITED ISSUANCE OF REGULATION.—The regulation
referred to in the amendment made by paragraph (2XD) shall
take effect not later than the expiration of the 90-day period
beginning on the date of the enactment of this Act. The regulation shall not be subject to the requirements of subsections
(b) and (c) of section 553 of title 5, United States Code, or
section 7(o) of the Department of Housing and Urban Development Act.
(b) EFFECTIVE DATE.—The amendments made by subsection
(a) shall apply with respect to fiscal year 1993 and thereafter.
SEC. 212. COMMUNITY HOUSING PRODUCTION SET-ASIDE.
(a) EXTENSION OF PBJRIOD.—Section 231 of the

CranstonGonzalez National Affordable Housing Act (42 U.S.C. 12771) is
amended by striking "18 months" each place it appears in subsections (a) and (b) and inserting "24 months".
(b) ALLOCATION FOR USE BY NONPROFIT ORGANIZATION.—Sec-

tion 231(a) of the Cranston-Cjronzalez National Affordable Housing
Act (42 U.S.C. 12771(a)) is amended by inserting after the second
sentence the following: "If during the first 24 months of its participation under this title, a participating jurisdiction is unable to identify
a sufficient number of capable commimity housing development
organizations, then up to 20 percent of the funds allocated to
that jurisdiction imder this section, but not to exceed $150,000,
may be made available to carry out activities that develop the
capacity of community housing development organizations in that
jurisdiction.".
(c) OTHER REQUIREMENTS.—Section 234(b) of the CranstonGonzalez National Affordable Housing Act (42 U.S.C. 12774(b))
is amended—
(1) by striking ", together with other Federal assistance,";
and
(2) by inserting before the period the following: "or $50,000
annually, whichever is greater".
SEC. 213. H O U S I N G EDUCATION AND ORGANIZATIONAL SUPPORT FOR
COMMUNITY LAND TRUSTS.
(a) COMMUNITY LAND TRUSTS.—Section 233 of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12773) is
amended—
(1) in subsection (aX2), by inserting ", including community
land trusts," after "organizations";
(2) in subsection (b), by adding at the end the following:
"(6) COMMUNITY LAND TRUSTS.—Organizational support,
technical assistance, education, training, and continuing sup>ort under this subsection may be made available to community
and trusts (as such term is defined in subsection (f)) and
to community groups for the establishment of community land
trusts."; and

I

Regulations.

Effective date.
42 u s e 12747
note.

42 u s e 12704
note.

106 STAT. 3758

PUBLIC LAW 102-550—OCT. 28, 1992
(3) by adding at the end the following:

"(f) DEFINITION OF COMMUNITY LAND TRUST.—For purposes
of this section, the term 'community land trust' means a community
housing development organization (except that the requirements
under subparagraphs (C) and (D) of section 104(6) shall not apply
for purposes of this subsection>—
"(1) that is not sponsored by a for-profit organization;
"(2) that is established to carry out the activities luider
paragraph (3);
"(3) that>"(A) acquires parcels of land, held in perpetuity, primarily for conveyance under long-term ground leases;
"(B) transfers ownership of any structural improvements located on such leased parcels to the lessees; and
"(C) retains a preemptive option to purchase any such
structural improvement at a price determined by formula
that is designed to ensure that the improvement remains
affordable to low- and moderate-income families in
perpetuity;
"(4) whose corporate membership that is open to any adult
resident of a particular geographic area specified in the bylaws
of the organization; and
"(5) whose board of directors—
"(A) includes a majority of members who are elected
by the corporate membership; and
"(B) is composed of equal numbers of (i) lessees pursuant to paragraph (3)(B), (ii) corporate members who are
not lessees, and (iii) any other category of persons described
in the bylaws of the organization.",
(b) WOMEN IN HOMEBUILDING.—Section 233 of the

Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 12773), as
amended by subsection (a) of this section, is further amended—
(1) in subsection (a)—
(A) in paragraph (1), by striking "and" at the end;
(B) in paragraph (2), by striking the period at the
end and inserting "; and"; and
(C) by adding at the end the following:
"(3) to achieve the purposes under paragraphs (1) and
(2) by helping women who reside in low- and moderate-income
neighborhoods rehabilitate and construct housing in the
neighborhoods.".
(2) in subsection (b), by adding after paragraph (6) (as
added by subsection (a)(2) of this section) the following:
"(7) FACILITATING WOMEN IN HOMEBUILDING PROFESSIONS.—

Technical assistance may be made available to businesses,
unions, and organizations involved in construction and
rehabilitation of housing in low- and moderate-income areas
to assist women residing in the area to obtain jobs involving
such activities, which may include facilitating access by such
women to, and providing, apprenticeship and other training
programs regarding nontraditional skills, recruiting women to
participate in such programs, providing continuing support for
women at job sites, counseling and educating businesses regarding suitable work environments for women, providing information to such women regarding opportunities for establishing
small housing construction and rehabilitation businesses, and
providing materials and tools for training such women (in an

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3759

amount not exceeding 10 percent of any assistance provided
under this paragraph). The Secretary shall give priority under
this paragraph to providing technical assistance for organizations rehabilitating single family or multifamily housing owned
or controlled by the Secretary pursuant to title II of the
National Housing Act and which have women members in
occupations in which women constitute 25 percent or less of
the total number of workers in the occupation (in this section
referred to as 'nontraditional occupations').";
(3) in subsection (c)(1)—
(A) in subparagraph (C), by striking "and" at the end;
(B) in subparagraph (D), by striking "or" at the end
and inserting "and"; and
(C) by adding at the end the following:
"(E) in the case of activities under subsection (bX7),
is a community-based organization (as such term is defined
in section 4 of the Job Training Partnership Act) or public
housing agency, which has demonstrated experience in
preparing women for apprenticeship training in construction or administering programs for training women for
construction or other nontraditional occupations (and such
organizations may use assistance for activities under such
subsection to employ women in housing construction and
rehabilitation activities to the extent that the organization
has the capacity to conduct such activities); or"; and
(4) by adding at the end of subsection (e) the following:
"The Secretary shall provide assistance under this section, to
the extent applications are submitted and approved, to contractors in each of the geographic regions having a regional ofEice
of the Department of Housing and Urban Development.".
SEC. 214. LAND BANK REDEVELOPMENT.
(a) PRIORITIES FOR CAPACITY DEVELOPMENT.—Section 242 of

the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
12782) is amended—
(1) in paragraph (4), by striking "and" at the end;
(2) in paragraph (5), by striking the period at the end
and inserting "; and"; and
(3) by adding at the end the following:
"(6) facilitate the establishment and efficient operation of
land bank programs, under which title to vacant and abandoned
parcels of real estate located in or causing blighted neighborhoods is cleared for use consistent with the purposes of this
title.".
SEC. 215. RESEARCH
IN PROVIDING
AFFORDABLE
HOUSING
THROUGH INNOVATIVE BUILDING TECHNIQUES AND
TECHNOLOGY.

The second sentence of section 244 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12784) is amended
by inserting before the period at the end the following: ", through
the use of cost-saving innovative building technology and construction techniques".

106 STAT. 3760

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 216. USE OF INNOVATIVE BUILDING TECHNOLOGIES TO PROVIDE COST-SAVING HOUSING OPPORTUNITIES.

Subtitle D of title II of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12801 et seq.) is amended by adding
at the end the following:
42 u s e 12810.

"SEC. 260. COST-SAVING BUILDING TECHNOLOGIES AND CONSTRUCTION TECHNIQUES.

"(a) I N GENERAL.—The Secretary shall make available a model
program to utilize cost-saving building technologies and construction
techniques for purposes of providing homeownership and rental
opportunities imder this title.
"(b) SELECTION CRITERIA.—The Secretary shall establish criteria for participating jurisdictions to select projects for assistance
luider the model program which may include—
"(1) the extent to which innovative, cost-saving building
and construction technologies are utilized;
"(2) the extent to which innovative, cost-saving construction
techniques are utilized;
"(3) the extent to which units will be made available to
low-income families and individuals;
"(4) the extent to which non-Federal public or private
assistance is utilized; and
"(5) any other factor, determined by the Secretary to be
appropriate.
"(c) (JUIDELINES.—^The Secretary shall publish guidelines for
the model program under this section not later than 180 days
after the date of the enactment of the Housing and Community
Development Act of 1992.
"(d) REPORT.—^The Secretary shall submit a biennial report
to the Congress on the utilization of the model program under
this section. .
SEC. 217. DEFINITION OF COMMUNITY
ORGANIZATION.

42 use 12704
"'***•

HOUSING

DEVELOPMENT

(a) I N GENERAL.—Section 104(6) of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12704(6)) is amended
by adding at the end the following new flush material:
"In the case of an organization serving more than one county,
the Secretary may not require that such organization, to be
considered a community housing development organization for
purposes of this Act, include as members on the organization's
governing board low-income persons residing in each county
served.".
(b) TRANSITION RuLE.—For the purposes of determining compliance with the requirements of section 104(6) of the Cranston-Gonzalez National Affordable Housing Act, the Secretary of Housing
and Urban Development may provide an exception for organizations
that meet the definition of community housing development
organization, except for significant representation of low-income
community residents on the board, if such organization fulfills
such requirement within 6 months of receiving funds under title
II of such Act or September 30,1993, whichever is sooner.
SEC. 218. INCLUSION OF ECHO HOUSING IN DEFINITION OF HOUSING.

Section 104(8) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12704(8)) is amended by inserting before
the period at the end the following: "and elder cottage housing

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3761

opportunity units that are small, free-standing, barrier-free, energyemcient, removable, and designed to be installed adjacent to existing 1- to 4-family dwellings".
SEC. 219. EUGIBIUTY OF MANUFACTURED HOME OWNERS AS FIRSTTIME HOMEBUYERS.
Section 104(14) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12704(14)) is amended—
(1) in subparagraph (A), by striking "and" at the end;
(2) in subparagraph (B), by striking the period at the
end and inserting "; and"; and
(3) by adding at the end the following new subparagraph:
"(C) an individual shall not be excluded from consideration as a first-time homebuyer under this paragraph on
the basis that the individual owns or owned, as a principal
residence during such 3-year period, a dwelling unit whose
structure is—
"(i) not permanently affixed to a permanent
foundation in accordance with local or other applicable
regulations, or
"(ii) not in compliance with State, local, or model
building codes, or other applicable codes, and cannot
be brought into compliance with such codes for less
than the cost of constructing a permanent structure.".
SEC. 220. ELIGIBILITY FOR ASSISTANCE AND CONTENTS OF
STRATEGIES.
(a) HOMELESSNESS INFORMATION.—Section 105(b)(2) of the
Cranston-Cjronzalez National Affordable Housing Act (42 U.S.C.
12705(b)(2)) is amended—
(1) by inserting ", including rural homelessness," after
"homelessness" the first place it appears; and
(2) by inserting "including tabular representation of such
information," after with homelessness,".
(b) ANTIDISPLACEMENT PLAN AND ANTIPOVERTY STRATEGY.—

Section 105(b) of the Cranston-Cjronzalez National Affordable Housing Act (42 U.S.C. 12705(b)) is amended—
(1) by striking paragraph (14) and inserting the following:
"(14) include a certification that the jurisdiction has in
effect and is following a residential antidisplacement and relocation assistance plan that, in any case of any such displacement
in connection with any activity assisted with amounts provided
under title II, requires the same actions and provides the
same rights as required and provided under a residential
antidisplacement and relocation assistance plan under section
104(d) of the Housing and Community Development Act of
1974 in the event of displacement in connection with a development project assisted under section 106 or 119 of such Act;".
(2) in paragraph (15), by striking the period at the end
and inserting "; and" and
(3) by adding at the end the following:
"(16) for any housing strategy submitted for fiscal year
1994 or any fiscal year thereafter and taking into consideration
factors over which the jurisdiction has control, describe the
jurisdiction's goals, programs, and policies for reducing the
number of households with incomes below the poverty line
(as defined by the Office of Management and Budget and
revised annually), and, in consultation with other appropriate

106 STAT. 3762

PUBLIC LAW 102-550—OCT. 28, 1992
public and private agencies, state how the jurisdiction's goals,
programs, and policies for producing and preserving affordable
housing set forth in the housing strategy will be coordinated
with other programs and services for which the jurisdiction
is responsible and the extent to which thev will reduce (or
assist in reducing) the number of households with incomes
below the poverty line; and".

(c) LINKAGE BETWEEN HOUSING N E E D AND ALLOCATION OF
HOUSING RESOURCES.—Section 105(b) of the Cranston-Gonzalez

National Affordable Housing Act (42 U.S.C. 12705(b)) is amended—
(1) by redesignating paragraphs (8) through (16) as paragraphs (9) through (17), respectively; and
(2) by inserting after paragraph (7) the following:
"(8) describe how the jurisdiction's plan will address the
housing needs identified pursuant to subparagraphs (1) and
(2), describe the reasons for allocation priorities, and identify
any obstacles to addressing underserved needs;".
SEC. 221. LOCATION OF ACTIVITIES.
42 u s e 12748.

42 u s e 12704
note.

42 u s e 12704
note.

Section 218(a) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12748a) is amended by inserting after
**boundaries" the following: "or within the boimdaries of contiguous
jurisdictions in joint projects which serve residents from both
jurisdictions".
SEC. 222. REGULATIONS.

The Secretary of Housing and Urban Development shall issue
anv final regulations necessary to implement the provisions of this
title and the amendments made by this title not later than the
expiration of the 180-day period beginning on the date of the enactment of this Act, except as expressly provided otherwise in this
title and the amendments made by this title. Such regulations
shall be issued after notice and opportunity for public comment
pursuant to the provisions of section 553 of title 5, United States
Code (notwithstanding subsections (aX2), (bXB), and (d)(3) of such
section).
SEC. 223. RETROACTIVE A P P U C A T I O N OF HOME AMENDMENTS.

The amendments made by this title shall apply to imexpended
funds allocated under title II of the Cranston-Gonzalez National
Affordable Housing Act in fiscal year 1992, except as otherwise
specifically provided.

TITLE III—PRESERVATION OF LOWINCOME HOUSING
Subtitle A—Prepayment of Mortgages
Insured Under National Housing Act
12 u s e 4124.

SEC. 301. AUTHORIZATION OF APPROPRIATIONS.

Section 234 of the Housing and Community Development Act
of 1987 (12 U.S.C. 4124) is amended to read as follows:
•^EC. 234. AUTHORIZATION OF APPROPRIATIONS.

"(a) I N GENERAL.—^There are authorized to be appropriated
for assistance and incentives authorized under this subtitle

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3763

$638,252,784 for fiscal year 1993 and $665,059,401 for fiscal year
1994.
"(b) GRANTS.—Subject to approval in appropriation Acts, not
more than $50,000,000 of the amounts made available under subsection (a) for fiscal year 1993, and not more than $50,000,000
of the amounts made available under subsection (a) for fiscal year
1994, shall be available for grants under section 221(dX2).''.
SEC. 302. GUIDELINES FOR APPRAISALS OF PRESERVATION VALUE.

The first sentence of section 213(c) of the Housing and Community Development Act of 1987 (12 U.S.C. 4103(c)) is amended by
inserting before "and costs" the following: "simultaneous termination of any Federal rental assistance,".
SEC. 303. SECOND NOTICE OF INTENT.

Section 216(d) of the Housing and Commimity Development
Act of 1987 (12 U.S.C. 4106(d)) is amended by adding at the end
the following new paragraph:
"(3) FILING WITH THE STATE OR LOCAL GOVERNMENT, TENANTS, AND MORTGAGEE.—^Upon filing a second notice of intent

under this subsection, the owner shall simultaneously file such
notice of the intent with the chief executive officer of the
appropriate State or local government for the jurisdiction within
which the housing is located and with the mortgagee, and
shall inform the tenants of the housing of the filing.".

SEC. 304. PLAN OF ACTION.
(a)
SUPPORTING DOCUMENTATION

REGARDING

PLAN

OF

ACTION.—Section 217(aX2) of the Housing and Community Development Act of 1987 (12 U.S.C. 4107(aX2)) is amended by inserting
after the second sentence the following new sentence: "Each owner
and the Secretary shall also, upon request, make available to the
tenants of the housing and to the office of the chief executive
officer of the appropriate State or local government for the jurisdiction within which the housing is located all docimientation supporting the plan of action, but not including any information that
the Secretary determines is proprietary information.".
(b) SUPPORTING DOCUMENTATION REGARDING REVISIONS.—Sec-

tion 217(c) of the Housing and Community Development Act of
1987 (12 U.S.C. 4107(c)) is amended in the second sentence by
inserting before the period the following: "and make available to
the Secretary and tenants all documentation supporting any revision, but not including any information that the Secretary determines is proprietary information".
SEC. 305. APPROVAL OF PLAN OF ACTION.

Section 218 of the Housing and Community Development Act
of 1987 (12 U.S.C. 4108) is amended—
(1) by redesignating subsection (b) as subsection (c); and
(2) by inserting after subsection (a) the following new subsection:
"(b) STANDARDS AND PROCEDURE FOR WRITTEN FINDINGS.—

"(1) STANDARDS.—A written finding under subsection (a)
shall be based on an analysis of the evidence considered by
the Secretanr in reaching such finding and shall contain documentation of such evidence.
"(2) PROCEDURE AND CRITERIA.—The Secretary shall, by RegiUations.
regulation, develop (A) a procedure for determining whether

106 STAT. 3764

PUBLIC LAW 102-550—OCT. 28, 1992
the conditions under paragraphs (1) and (2) of subsection (a)
exist, (B) requirements for evidence on which such determinations are based, and (C) criteria on which such determinations
are based.".

SEC. 306. RECEIPT OF INCENTIVES TO EXTEND LOW-INCOME USE.

Section 219(a) of the Housing and Community Development
Act of 1987 (12 U.S.C. 4109(a)) is amended—
(1) in the first sentence, by inserting after "receive" the
following: "(for each year after the approval of the plan of
action)"; and
(2) by adding at the end the following new sentence: "The
Secretary shall take such actions as are necessary to ensure
that owners receive the annual authorized return for the housing determined under section 214(a) during the period in which
rent increases are phased in as provided in section 222(aX2XE),
including (in order of preference) (1) allowing the owner access
to residual receipt accounts (pursuant to subsection (bXD of
this section), (2) deferring remittance of excess rent payments,
and (3) providing an increase in rents permitted under an
existing contract under section 8 of the United States Housing
Act of 1937 (pursuant to subsection (b)(2) of this section). .
SEC. 307. TRANSFER TO QUALIFIED PURCHASERS.
(a) EUGIBILITY FOR ASSISTANCE.—The matter preceding
subparagraph (A) in section 220(d)(2) of the Housing and Community Development Act of 1987 (12 U.S.C. 4110(dX2)) is amended
by inserting after "purchasers" the following: "(including all priority
piirchasers other than resident councils acquiring under the
homeownership program authorized by section 226)".
(b) PROJECT OVERSIGHT.—Section 220(dX2XD) of the Housing
and Commimity Development Act of 1987 (12 U.S.C. 4110(dX2)(D))
is amended by inserting before the semicolon the following: ", and
in the case of a priority purchaser, meet project oversight costs".
(c) RETURN.—Section 220(dX2XE) of the Housing and Community Development Act of 1987 (12 U.S.C. 4110(dX2XE)) is amended
to read as follows:
"(E) receive a distribution equal to an 8 percent annual
return on any actual cash investment (from sources other
than assistance provided under this title) made to acquire
or rehabilitate the project;".
(d) REIMBURSEMENT.—Section 220(dX2XF) of the Housing and
Community Development Act of 1987 (12 U.S.C. 4110(dX2XF)) is
amended to read as follows:
"(F) in the case of a priority purchaser, receive a
/
reimbursement of all reasonable transaction expenses associated with the acquisition, loan closing, and implementation of an approved plan of action; and".
(e) INCENTIVES.—Section 220(dX3XA) of the Housing and
Community Development Act of 1987 (12 U.S.C. 4110(dX3XA)) is
amended by striking "any residual receipts" and all that follows
through "(b) or (c) and".
SEC. 308. CRITERIA FOR PLAN OF ACTION INVOLVING INCENTIVES.
(a) ELIMINATION OF WINDFALL PROFITS TEST.—Section 222 of

the Housing and Commimity Development Act of 1987 (12 U.S.C.
4112) is amended by striking subsection (e).

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3765

(b) RENT ADJUSTMENTS.—Section 222(aX2XGXi) of the Housing

and Community Development Act of 1987 (12 U.S.C.
4112(aX2XGXi)) is amended by striking '1[>y making changes in
the annual authorized return under section 214" and inserting
the following: ", where the owner is a priority purchaser, to the
portion of rent attributable to project oversight costs".
SEC. 309. RESIDENT HOMEOWNERSHIP PROGRAM.
Section 226(b) of the Housing and Community Development
Act of 1987 (12 U.S.C. 4116(b)) is amended—
(1) in paragraph (2)—
(A) by inserting "AND LIMITATION ON CONDITIONS OF
APPROVAL before the period at the end of the paragraph
heading; and
(B) by inserting after the period at the end the following new sentence: "The Secretary may not require the
prepayment of the mortgage on eligible low-income housing
for the approval of a plan of action involving a homeownership program for the housing.";
(2) in paragraph (3)—
(A) in subparagraph (C), by striking "and" at the end;
(B) in subparagraph (D), by striMng the period at
the end and inserting "; and"; and
(C) by adding at the end the following new subparagraph:
"(E) the low-income affordability restrictions shall continue to apply to any rental units in the housing for any
period during which such units remain rental units.";
(3) in paragraph (8), by striking "Resident" and inserting
"Except in the case of limited equity cooperatives, resident ,
and
(4) in paragraph (10)—
(A) by striking ", as determined by the Secretary,";
(B) by striking "section 222(d)" and inserting "section
222(c)"; and
(C) by striking the last sentence.
SEC. 310. DEFINITION OF EUGIBLE LOW-INCOME HOUSING.
Section 229(lXA)(i) of the Housing and Community Development Act of 1987 (12 U.S.C. 4119(lXAXi)) is amended by striking
"assisted under section 101 of the Housing and Urban Development
Act of 1965 or section 8 of the United States Housing Act of
1937" and inserting "receiving loan management assistance under
section 8 of the United States Housing Act of 1937 due to a conversion from section 101 of the Housing and Urban Development
Act of 1965".
SEC. 311. PREEMPTION OF STATE AND LOCAL LAWS.
The first sentence of section 232(b) of the Housing and Community Development Act of 1987 (12 U.S.C. 4122(b)) is amended by
stnking "and" the first place it appears and inserting ", such as
any law or regulation".
SEC. 312. TECHNICAL ASSISTANCE AND CAPACITY BUILDING.
Title n of the Housing and Community Development Act of
1987 (42 U.S.C. 4101 et seq.) is amended by adding at the end
the following new subtitle:

106 STAT. 3766

PUBLIC LAW 102-550—OCT. 28, 1992

"Subtitle C—^Technical Assistance and
Capacity Building
12 u s e 4141.

"SEC. 251. AUTHORITY.
**The Secretary of Housing and Urban Development may provide
technical assistance and capacity building to further the preservation program established under this title.

12 use 4142.

"SEC. 262. PURPOSES.
"The purposes of this subtitle are—
"(1) to promote the ability of residents of eligible lowincome housing to meaningfully participate in the preservation
process established by this title and affect decisions about the
future of their housing;
"(2) to promote the ability of community-based nonprofit
housing developers and resident councils to acquire, rehabilitate, and competently own and manage eligible housing as
rental or cooperative housing for low- and moderate-income
people; and
"(3) to assist the Secretary in discharging the obligation
under section 220 to notify potential qualified purchasers of
the availability of properties for sale and to otherwise facilitate
the coordination and oversight of the preservation program
established under this title.

12 use 4143.

"SEC. 253. GRANTS FOR BUILDING RESIDENT CAPACITY AND FUNDING PREDEVELOPMENT COSTS.
"(a) IN GENERAL.—^Assistance made available under this section
shall be used for direct assistance grants to resident organizations
and community-based nonprofit housing developers and resident
councils to assist the acquisition of specific projects (including the
pajmaent of reasonable administrative expenses to participating
intermediaries).
"(b) ALLOeATiON.—30 percent of the assistance made available
under this section shall be used for resident capacity grants in
accordance with subsection (d). The remainder shall be used for
predevelopment grants in connection with specific projects in accordance with subsection (e).
"(c) LIMITATION ON GRANT AMOUNTS.—A resident capacity grant
under subsection (d) may not exceed $30,000 per project and a
rant imder subsection (e) for predevelopment costs may not exceed
200,000 per project, exclusive of any fees paid to a participating
intermediary by the Secretary for administering the program.

f

"(d) RESIDENT CAPACITY GRANTS.—

"(1) USE.—^Resident capacity grants under this subsection
shall be available to eligible applicants to cover expenses for
resident outreach, incorporation of a resident organization or
council, conducting democratic elections, training, leadership
development, legal and other technical assistance to the board
of directors, staff and members of the resident organization
or council.
"(2) ELIGIBLE HOUSING.—Grants under this subsection may
be provided with respect to eligible low-income housing for
which the owner has filed a notice of intent under subtitle
B of this title or title II of the Emergency Low Income Housing

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3767

Preservation Act of 1987 (pursuant to section 604 of the Cranston-Gronzalez National Afjfordable Housing Act).
"(e) PREDEVELOPMENT GRANTS.—

"(1) USE.—Predevelopment grants under this subsection
shall be made available to community-based nonprofit housing
developers and resident councils to cover the cost of organizing
a purchasing entity and pursuing an acquisition, including
third party costs for training, development consulting, legal,
appraisal, accounting, environmental, architectural and
engineering, application fees, and sponsor's staff and overhead
costs.
"(2) ELIGIBLE HOUSING.—Such grants may onljr be made
available with respect to any eligible low-income housing project
for which the owner has filea an initial notice of intent to
transfer the housing to a qualified purchaser in accordance
with section 220 of this title, or has filed a notice of intent
and entered into a binding agreement to sell the housing to
a resident organization or nonprofit organization.
"(3) PHASE-IN OF GRANT PAYMENTS.—Grant payments imder
this subsection shall, be made in phases, based on performance
benchmarks established by the Secretary in consultation with
intermediaries selected under section 255(b).
"(f) GRANT APPLICATIONS.—Grant applications for assistance

under subsections (d) and (e) shall be received monthly on a rolling
basis and approved or rejected on at least a quarterly basis by
intermediaries selected under section 255(b).
"(g) APPEAL.—If an application for assistance under subsections
(d) or (e) is denied, the applicant shall have the right to appeal
the denial to the Secretary and receive a binding determination
within 30 days of the appeal.
•«EC. 254. GRANTS FOR OTHER PURPOSES.

12 USC 4144.

'The Secretary may provide grants under this subtitle—
"(1) to resident-controlled or community-based nonprofit
organizations with experience in resident education and
organizing for the purpose of conducting community, city or
county wide outreach and training programs to identify and
organize residents of eligible low-income housing; and
"(2) to State and local government agencies and nonprofit
intermediaries for the purpose of carrying out such activities
as the Secretary deems appropriate to further the preservation
program established under this title.
"SEC. 255. DELIVERY OF ASSISTANCE THROUGH INTERMEDIARIES.

"(a) I N GENERAL.—The Secretary shall approve and disburse
assistance under section 253 through eligible intermediaries
selected by the Secretary under subsection (D). If the Secretary
does not receive an acceptable proposal from an intermediary offering to administer assistance under this section in a given State,
the Secretary shall administer the program in such State directly.
"(b) SELECTION OF ELIGIBLE INTERMEDIARIES.—

"(1) I N GENERAL.—^The Secretary shall develop criteria to
select eligible intermediaries, through a competitive process,
to administer assistance under this subtitle. The process shall
include provision for a reasonable administrative fee.
"(2) PRIORITY.—^With respect to all forms of grants available
under section 253, such criteria shall give priority to applications from eligible intermediaries with demonstrated expertise

59-194 O—93

5 : QL 3 (Pt. 5)

12 USC 4145.

106 STAT. 3768

PUBLIC LAW 102-550—OCT. 28, 1992
or experience with the program established under this title
or under the Emergency Low Income Housing Preservation
Act of 1987.
"(3) CRITERIA.—^The criteria developed under this subsection shall—
"(A) not assign any preference or priority to applications from eligible intermediaries based on their previous
participation in administering or receiving Federal grants
or loans (but may exclude applicants who have failed to
perform under prior contracts of a similar nature);
"(B) require an applicant to prepare a proposal that
demonstrates adequate staffing, qualifications, prior experience, and a plan for participation; and
"(C) permit an applicant to serve as the administrator
of assistance made available under section 253(d) or (e),
based on the applicant's suitability and interest.
"(4) GEOGRAPHIC COVERAGE.—The Secretary may select

more than 1 State or regional intermediary for a single State
or region. The number of intermediaries chosen for each State
or region may be based on the number of eligible low-income
housing projects in the State or region, provided there is no
duplication of geographic coverage by intermediaries in the
administration of the direct assistance grant program.
"(5) NATIONAL NONPROFIT INTERMEDIARIES.—National nonprofit intermediaries shall be selected to administer the assistance made available under section 253 only with respect to
States or regions for which no other eligible intermediary,
acceptable to the Secretary, has submitted a proposal to
participate.
"(6) PREFERENCE.—^With respect to assistance made available under section 254, preference shall be given to eligible
regional. State, and local intermediaries, over national nonprofit
organizations.
"(c) CONFLICTS OF INTEREST.—Eligible intermediaries selected
xmder subsection (b) to disburse assistance under section 253 shall
certify that they will serve only as delegated program administrators, charged with the responsibility for reviewing and approving
grant applications on behalf of the Secretary. Selected
intermediaries shall—
"(1) establish appropriate procedures for grant administration and fiscal management, pursuant to standards established
by the Secretary; and
"(2) receive a reasonable administrative fee, except that
they may not provide other services to grant recipients with
respect to projects that are the subject of the grant application
and may not receive pajrment, directly or indirectly, from the
proceeds of grants they have approved.
"(d) DEFINITION OF ELIGIBLE INTERMEDIARIES.—For purposes

of this section, the term 'eligible intermediary' means a State,
regional, or national organization (including a quasi-public organization) or a State or local housing agency that—
"(1) has as a central purpose the preservation of existing
affordable housing and the prevention of displacement;
"(2) does not receive direct Federal appropriations for
operating support;
"(3) in the case of a national nonprofit organization, has
been in existence for at least 5 years prior to the date of

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3769

application and has been classified by the Internal Revenue
Service as an exempt organization under section 501(cX3) of
the Internal Revenue Code of 1986;
"(4) in the case of a regional or State nonprofit organization,
has been in existence for at least 3 years prior to the date
of ai}plication and has been classified by the Internal Revenue
Service as an exempt organization under section 501(cX3) of
the Internal Revenue Code of 1986 or is otherwise a taxexempt entity;
"(5) has a record of service to low-income individuals or
community-based nonprofit housing developers in multiple
communities and, with respect to intermediaries administering
assistance under section 253, has experience with the allocation
or administration of grant or loan funds; and
"(6) meets standards of fiscal responsibility established by
the Secretary.
"SEC. 256. DEFINITIONS.

12 USC 4146.

"For purposes of this subtitle—
**(1) the term 'community-based nonprofit housing developer* means a nonprofit community development corporation
that—
"(A) has been classified by the Internal Revenue Service as an exempt organization imder section 501(c)(3) of
the Internal Revenue Code of 1986;
"(B) has been in existence for at least 2 years prior
to the date of the grant application;
"(C) has a record of service to low- and moderateincome people in the community in which the project is
located;
"(D) is organized at the neighborhood, city, county
or multi-coimty level; and
"(E) in the case of a corporation acquiring eligible
housing under subtitle B of tnis title, agrees to form a
purchaser entity that conforms to the definition of a
community-based nonprofit organization under such subtitle and agrees to use its best efforts to secure majoritv
tenant consent to the acquisition of the project for whicn
grant assistance is requested; and
"(2) the terms 'eligible low-income housing*, 'nonprofit
organization', 'owner*, and 'resident council* have uie meanings
given such terms in section 229.
"SEC. 257. FUNDING.

"The Secretary shall use not more than $25,000,000 of the
amoimts made available under section 234(a) for fiscal year 1993,
and not more than $25,000,000 of the amounts made available
under section 234(a) for fiscal year 1994, to carry out this subtitle.
Of any amounts made available to carry out this subtitle in any
appropriation Act, 90 percent shall be set aside for use in accordance
with section 253 and 10 percent shall be set aside for use in
accordance with subsection 254.**.
SEC. 313. TRANSITION PROVISIONS.

(a) EFFECT OF ELEcnoN.—Section 604(a) of the Cranston-Gonzalez National Affordable Housing Act (12 U.S.C. 4101 note) is
amended by adding at the end the following sentence: "An owner
that electe to be subject to the provisions of the Emergency Low

12 USC 4147.

106 STAT. 3770

12USC4101
^°^'

PUBLIC LAW 102-550—OCT. 28, 1992

Income Housing Preservation Act of 1987 shall comply with section
212(b), section 217(a)(2), and section 217(c) of the Low-Income Housing Preservation and Resident Homeownership Act of 1990.**.
(b) CHANGES TO PROVISIONS O F 1987 ACT.—Section 604(c) of
the Cranston-Cjonzalez National Affordable Housing Act (12 U.S.C.
4101 note) is amended by adding at the end the following new
sentence: ' ^ i t h respect to housing for which such an election is
made—
''(1) in making incentives under section 224 of such Act
available to such housing, the Secretary—
"(A) shall, for approvable plans of action, provide assistance sufficient to enable a nonprofit organization that has
purchased or will purchase an eligible low income housing
project to meet project oversight costs; and
"(B) may not refuse to offer incentives referred to in
such section to any owner who filed a notice of intent
under section 222 of such Act before October 15, 1991,
based solely on the date of filing of the plan of action
for the housing; and
"(2) the provisions of section 233(lXAXi) of such Act shall
not apply, and the term 'eligible low income housing* shall,
for purposes of such Act, shall include housing financed by
a loan or mortgage that is insured or held by the Secretary
or a State or State agency under section 221(dX3) of the
National Housing Act and receiving loan management assistance under section 8 of the United States Housing Act of
1937 due to a conversion from section 101 of the Housing
and Urban Development Act of 1965.**.
SEC. 314. CONDITIONS OF ASSISTANCE.
j
(a) EUHPA OF 1987.—The Secretary may not require, as a
condition of eligibility for or receipt of technical assistance made
available under the Departments of Veterans Affairs and Housing
and Urban Development, and Independent Agencies Appropriations
Act, 1992 (Public Law 102-139) (including any phase of a grant),
that an applicant participate in a training program sponsored or
conducted by the Department of Housing and Urban Development
for acquisition of eligible low income housing under the provisions
of the Emergency Low Income Housing Preservation Act of 1987,
and may not provide any preference or priority for such assistance
for any applicant based on participation in such a program.
(b) LiHPRHA OF 1990.—^The Secretarv may require, as a condition of eligibility for or receipt of technical assistance made available
under the Departments of Veterans Affairs and Housing and Urban
Development, and Independent Agencies Appropriations Act, 1992
(Public Law 102-139) (including any phase of^ a grant), that an
applicant participate in a training program sponsored or conducted
by the Department of Housing and Urban Development for acquisition of eligible low-income housing under this title, and may provide
preference or priority for such assistence for applicante based on
participation in such a program, but only if the program is made
available on a nationwide basis not later than March 1, 1993.

Regulations.
12 u s e 4117

SEC. 315. DELEGATED RESPONSIBIUTY TO STATE AGENCIES.

note.

The Secretary of Housing and Urban Development shall issue
interim regulations implementing section 227 of the Housing and
Community Development Act of 1987 (as amended by section 601(a)
of the Cranston-Gonzalez National Affordable Housing Act) not

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3771

later than the expiration of the 30-day period beginning on the
date of the enactment of this Act, wMch shcJl iusa effect upon
issuance. The Secretary shall issue final regulations implementing
such section 227 after notice and opportunity for public comment
regarding the interim regulations, pursuant to the provisions of
section 553 of title 5, United States Code (notwithstanding subsections (aX2), (bXB), and (dX3) of such section). The duration
of the period for public comment shall not be less than 60 days,
and the final regulations shall be issued not later than the expiration of the 60-aay period beginning upon the conclusion of the
conunent period and shall take effect upon issuance.
SEC. 316. INSURANCE FOR SECOND MORTGAGE FINANCING.

(a) TERMS.—Section 241(f) of the National Housing Act (12
U.S.C. 1715z-6(f)) is amended—
(1) in paragraph (2XBXi), by inserting after "equal to"
the following: 'rhe amount of rehabilitation costs required by
the plan of action eind related charges and";
(2) in paragraph (3XB), by inserting after "1990" the following: "and the amount of rehabilitation costs required by the
plan of action and related charges and";
(3) in paragraph (5)—
(A) by redesignating subparagraph (B) as subparagraph (C); and
(B) by striking subparagraph (A) and inserting the
following new subparagraphs:
"(AXi) in the case of equity loans, have a term not to exceed
40 years and amortization provisions which will, to the extent
practicable, support the loan amount authorized under paragraph
(2XB); and
"(ii) in the case of acquisition loans, have a term of not less
than 40 years; and
"(B) bear interest at such rate as may be agreed upon by
the mortgagor and mortgagee and be secured in such manner
as the Secretary may reciuire; and";
(4) by striking paragraph (6); and
(5) by redesignating paragraphs (7) through (9) as paragraphs (6) through (8), respectively.
(b) RENEGOTIATION.—Section 241(f) of the National Housing
Act (12 U.S.C. 17z-6(f)) is amended by adding at the end the 12 u s e 1715Z-6.
following new paragraph:
"(10) The Secretar}^ shall renegotiate and modify the terms
of an equity loan insuired under this subsection, at the request
of the owner of the project for which the loan is made, if—
"(1) the loan was made during the period beginning 30
days before the date of the enactment of the Housing and
Community Development Act of 1992 and ending 90 days after
such date of enactment under this subsection; ana
"(2) the lo£in wsis made pursuant to a plan of action under
the provisions of the Emergency Low Income Housing Preservation Act of 1987 and accepted by the Secretary for processing
in December 1991.".
(c) REGULATIONS.—^Not later than the expiration of the 45- 12 u s e 1715Z-6
day period beginning on the date of the enactment of this Act, note.
the Secretary shall issue regulations implementing section 241(fXl)
of the National Housing Act. The regulations shall not be subject

106 STAT. 3772

PUBLIC LAW 102-550—OCT. 28, 1992

to the requirements of subsections (b) and (c) of section 553 of
title 5, United States Code.
SEC. 317. TECHNICAL AMENDMENTS.
(a)

12 use 4105.
12 use 4106.
12 use 4111.
12 use 4112.

12 use 4119.
12 use 4121.

LOW-INCOME

HOUSING

PRESERVATION

AND

RESIDENT

HOMEOWNERSHIP ACT OF 1990.—The Housing and Community
Development Act of 1987 (12 U.S.C. 4101 et seq.) is amended—
(1) in section 215(aX2), by inserting "Housing" after **United
States";
(2) in section 216(bX4), by striking "exceeds" and inserting
"exceed";
(3) in the second sentence of section 221(c), by striking
"that" and inserting "than";
(4) in section 222—
(A) in subsection (aX2XA), by striking "low income"
and inserting "low-income";
^
(B) in subsection (cX2), by striking "an hearing" and
inserting "a hearing";
(C) in subsection (dX2XB), by inserting "the" after
"that"; and
(D) in subsection (dX2XCXii), by inserting "in" before
"default";
(5) in section 229(11XA), by striking "resident" and inserting "residents"; and
(6) in section 231(b), by striking "section 222(d)" and inserting "section 222(c)".
(b)

CRANSTON-GONZALEZ NATIONAL AFFORDABLE

HOUSING

ACT.^-Section 613(bX2) of the Cranston-Gonzalez National Affordable Housing Act (12 U.S.C. 4125(bX2)) is amended by striking
"section 224(e)" and inserting "section 222(d)".
(c) NATIONAL HOUSING ACT.—Section 241(f) of the National
Housing Act (12 U.S.C. 1715z-6(f)) is amended—
(1) in paragraph (2XBXii), by striking "and" at the end;
and
(2) in paragraph (7), by striking "acquisiton loan" and
inserting "acquisition loan".
12 u s e 4109
*»ote.

S E C . 318. STUDY OF PROJECTS ASSISTED UNDER FLEXIBLE SUBSIDY
PROGRAM.

(a) STUDY.—^The Secretary shall conduct a study of housing
projects that (1) are assisted under section 236 of the National
Housing Act or the proviso of section 221(dX5) of such Act, and
(2) have received or are receiving assistance under section 201
of the Housing and Commimity Development Amendments of 1978,
to determine the cost of providing such projects with incentives
under the Low-Income Housing Preservation and Resident
Homeownership Act of 1990. The study shall examine any projects
portions of which assisted under such section 236 that are assisted
primarily by State agencies.
(b) REPORT.—^The Secretary shall submit a report to the Congress regarding any findings and conclusions of the study under
subsection (a) not later than the expiration of the 1-year period
beginning on the date of the enactment of this Act.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3773

Subtitle B—Other Preservation Provisions
SEC. 331. EUGIBILnY OF PUBUC MORTGAGORS FOR SECTION 236
MORTGAGE INSURANCE.

Section 236qX4XA) of the National Housing Act (12 U.S.C.
1715z-l(jX4XA)) is amended by striking "private".
SEC. 332. REGULATIONS.

12 USC 4101

Except as otherwise provided in this title, the Secretary of "° '
Housing and Urban Development shall issue interim regulations
implementing this title ana the amendments made by this title
not later than the expiration of the 90-day period beginning on
the date of the enactment of this Act, which shall take effect
upon issuance. The Secretary shall issue final regulations
implementing this title and the amendments made by this title
after notice and opportunity for public comment regarding the
interim regulations, pursuant to the provisions of section 553 of
title 5, United States Code (notwithstanding subsections (aX2),
(bXB), and (dX3) of such section). The duration of the period for
public comment shall not be less than 60 days, and the final
regulations shall be issued not later than the expiration of the
60-day period beginning upon the conclusion of the comment period
and snail take effect upon issuance.

TITLE
IV—MULTIFAMILY
HOUSING
PLANNING AND INVESTMENT STRATEGIES
SEC. 401. DEFINITIONS.

For purposes of this title:
(1) COVERED MULTIFAMILY HOUSING PROPERTY.—The term
"covered multifamily housing property" means any housing—
(A) that is—
(i) reserved for occupancy by very low-income
elderly persons pursuant to section 202(dXl) of the
Housing Act of 1959;
(ii) assisted under the provisions of section 202
of the Housing Act of 1959 (as such section existed
before the effectiveness of the amendment made by
section 801(a) of the Cranston-Cjonzalez National
Affordable Housing Act);
(iii) fincmced by a loan or mortgage insured,
assisted, or held by the Secretary or a State or State
agency under section 236 of the National Housing Act;
or
(iv) financed by a loan or mortgage insured or
held by the Secretary pursuant to section 221(dX3)
of the National Housing Act; and
(B) that is not eligible for assistance under—
(i) the Low-Income Housing {^reservation and Resident Homeownership Act of 1990;
(ii) the provisions of the Emergency Low Income
Housing Preservation Act of 1987 (as in effect imme-

12 USC 1715z-la

106 STAT. 3774

PUBLIC LAW 102-550—OCT. 28, 1992
diately before the date of the enactment of the Cranston-Gonzalez National Affordable Housing Act); or
(iii) the HOME Investment Partnerships Act.
(2) COVERED MULTIFAMILY HOUSING PROPERTY FOR THE

ELDERLY.—^Hie term "covered multifamily housing property for
the elderly^ means any multifamily housing project that was
designed or designated to serve, or is serving, elderly persons
or families and is assisted imder a program administered by
the Secretary.
(3) SECRETARY.^The term "Secretary" means the Secretary
of Housing and Urban Development.
12 u s e 1715z-la

SEC. 402. REQUIRED SUBMISSION.

"° •

(a) I N GENERAL.—^The owner of each covered multifamily housing property, and the owner of each covered multifamily housing
propertv for the elderly, shall submit to the Secretary of Housing
and Urban Development a comprehensive needs assessment of the
property under this title.
(b) TIMING.—^The Secretary shall reauire the owners of approximately one-third of the aggregate number of covered multifamily
housing properties, and the owners of approximately one-third of
the aggregate number of covered multiiamily housing properties
for the elderly, to submit the comprehensive needs assessments
under this section for the properties in each of fiscal years 1993,
1994, and 1995, in a manner designed to ensure that upon the
conclusion of fiscal year 1995 the assessments for all such properties
have been submitted.

12 u s e 1715z-la

SEC. 403. CONTENTS.

(a) I N GENERAL.—^Each comprehensive needs assessment
submitted under this title for a covered multifamily housing property or a covered multifamily housing property for the elderly
shall contain the following information witn respect to the property:
(1) A description of any financial or other assistance currently needed for the property to ensure that the property
is maintained in a livable condition and to ensure the financial
viability of the project.
(2) A description of any financial or other assistance for
the property that, at the time of the assessment, is reasonably
foreseeable as necessary to ensure that the property is maintained in a livable condition and to ensure the financial viability
of the project, during the remaining useful life of the property.
(3) A description of anv resources available for meeting
the current and future needs of the property described under
paragraphs (1) and (2) and the likelihood of obtaining such
resources.
(4) A description of any assistance needed for the property
under programs administered by the Secretary.
(b) PROJECTS FOR THE ELDERLY.—^Each comprehensive needs
assessment for a covered multifamily housing property for the
elderly shall include, in addition to the information required under
subsection (a), the following information with respect to the
property:
(1) A description of the supportive service needs of such
residents and any supportive services provided to elderly residents of the property.
(2) A description of any modernization needs and activities
for the property.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3775

(3) A description of any personnel needs for the property.
SEC. 404. SUBMISSION AND REVIEW.

(a) FORM.—^The Secretaiv shall establish the form and manner
of submission of the comprehensive needs assessments under tiiis
title.
(b) RESIDENT REVIEW.—^The Secretary shall require each owner
of a covered multifamily housing property and each owner of a
covered multifamily housing property for the elderly to make available to the residents of the property the comprehensive needs
assessment that is to be submittea to the Secretai^. The Secretaipr
shall require each owner to provide for such residents to submit
comments and opinions regarding the assessment to the owner
before the submission of the assessment.
(c) STATE HOUSING FINANCE AGENCY REVIEW.—TO the extent
that a covered multifamily housing proi>erty or a covered multifamily housing property for the elderly is nnanced or assisted by
a State housing finance agency (as such term is defined in section
802 of the Housing and Community Development Act of 1974),
the Secretary shall require the owner of the property to submit
the comprehensive neeofs assessment for the property to tiie State
housing finance agency upon submitting the assessment to the
Secretary.
(d) REVIEW.—^The Secretary shall review each comprehensive
needs assessment and shall approve the assessment before the
expiration of the 90-day period beginning upon the receipt of the
assessment, unless the Secretary determmes that the assessment
has not been provided in a substantially complete manner.
(e) COST OF PREPARATION OF STRATEGY.—The Secretary shall
consider any costs relating to preparing a comprehensive needs
assessment under this title for a covered multifamily housing property that do not exceed $5,000 for the property as an ehgible
project expense for the property. The Secretary shall provide that
an owner may not increase the rental charge for any unit in
a covered multlfainily housing property to provide for the cost
of preparing a comprehensive neeos assessment.
(f) NOTICE.—^llie Secretary shall immediately notify each owner
submitting a comprehensive needs assessment (and any State housing finance agency to which the owner has submitted an assessment
imder subsection (d)) of the approval or disapproval of the assessment upon making such determination. Within 30 days after disapproving any assessment, the Secretary shall inform the owner
in writing of tne reasons for disapproval. The Secretary shall require
any owner whose assessment is disapproved to resubmit an
amended assessment not later than 30 days after the owner receives
the notice of disapproval.
(g) ANNUAL REVIEW AND REPORT OF FUNDING AND TARGETING
F R COVERED MULTIFAMILY PROPERTIES FOR THE ELDERLY.—
O

(1) REVIEW.—^The Secretary shall annually conduct a comprehensive review of—
(A) the funding levels required to fully address the
needs of covered multifamily housing properties for the
elderly identified in the comprehensive needs assessments
under section 403(b), specifically identifying any expenses
necessary to make substantial repairs and add features
(such as congregate dining facilities and commercial kitchens) resulting fimm development of a property in compliance

12 USC 1715z-la

106 STAT. 3776

PUBLIC LAW 102-550—OCT. 28, 1992
with cost-containment requirements established by the
Secretary;
(B) the adequacy of the geographic targeting of
resources provided unaer programs of the Department with
respect to covered multifamuy housing properties for the
elderly, based on information acquired pursuant to section
403(b); and
(C) local housing markets throughout the United
States, with respect to the need, availability, and cost
of housing for elderly persons and families, which shall
include review of any information and plans relating to
housing for elderly persons and families included in comprehensive housing affordability strategies submitted by
jurisdictions pursuant to section 105 of the Cranston-Gonzalez National Affordable Housing Act.
(2) REPORT.—^The Secretary of Housing and Urban Development shall submit a report to the Congress annually describing
the results of the annual comprehensive needs assessments
under section 402 for covered multifamily housing properties
for the elderly and the annual review conducted under paragraph (1) of this subsection, which shall contain a description
of the methods used by project owners and by the Secretary
to acquire the information described in section 402(b) and any
findings and recommendations of the Secretary pursuant to
the review.

SEC. 405. TROUBLED MULTIFAMILY HOUSING.
(a) MANDATORY ELEMENTS.—Section 201(d) of the Housing and

Community Development Amendments of 1978 (12 U.S.C. 1715zla(d)) is amended—
(1) in paragraph (5), by striking "and";
(2) in paragraph (6), by striking the period and inserting
a semicolon; and
(3) by adding at the end the following new paragraphs:
"(7) all reasonable attempts have been made to take all
appropriate actions and provide suitable housing for project
residents;
"(8) the project has a feasible plan to involve the residents
in project decisions;
"(9) the affirmative fair housing marketing plan meets
applicable requirements; and
"(10) the owner certifies that it will comply with various
equal opportunity statutes.".
(b) SELECTION CRITERIA.—
(1) REPEAL OF SECTION 20i(kX4).—Section 201(k)(4) of the

Housing and Community Development Amendments of 1978
(12 U.S.C. 1715z-la(kX4)) is repealed.
(2) N E W CRITERIA.—Section 201 of the Housing and
Community Development Amendments of 1978 is amended by
adding at the end the following new subsection:
"(n)(l) The Secretary shall award assistance under this section
to eligible projects on the basis of the following selection criteria:
"(A) The extent to which the project presents an imminent
threat to the life, health, and safety of project residents.
"(B) The extent to which the project is financially troubled.
"(C) The extent of physical improvements needed by the
project as evidenced by the comprehensive needs assessment

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3777

submitted in accordance with title IV of the Housing and
Community Development Act of 1992.
"(D) The extent to which there is evidence that there will
be significant opportimities for residents (including a resident
council or resident management corporation, as appropriate)
to be involved in management of the project (except that this
paragraph shall have no appUcation to projects that are owned
as cooperatives).
"(£) The extent to which there is evidence that the project
owner has provided competent management and complied with
all regulatory and administrative instructions (including such
instructions with respect to the comprehensive servicmg of
multifamily projects as the Secretary may issue).
"(F) Such other criteria as the Secretary may specify by
regulation or in a Federal Register notice of fund availability.
"(2) Eligible projects that have federally insured mortgages
in force are to be selected for award of assistance under this
section before any other eligible project.".
(c)

LOW-INCOME

AFFORDABIUTY

RESTRICTIONS.—Section

201(1X2XD) of the Housing and Commimity Development Amendments of 1978 (12 U.S.C. 1715z-la(lX2XD)) is amended by adding
at the end the following: "The Secretary mav require owners receiving assistance for capital improvements under this section to retain
the housing as housing affordable for very low-income families
or persons, low-income families or persons and moderate-income
families or persons for the remaining useful life of the housing.
For purposes of this section, the term 'remaining useful life' means,
with respect to housing assisted imder this section, the period
diuring which the physical characteristics of the housing remain
in a condition suitable for occupancy, assuming normal maintenance
and repairs are made and major systems and capital components
are replaced as becomes necessary.".
(d) EXCLUSIVITY OF ASSISTANCE.—Section 201 of the Housing
and Community Development Amendments of 1978, as amended
by this section, is furtner amended by adding at the end the
following new subsection:
"(o) Projects receiving assistance imder this section are not
eligible for prepayment incentives under the Emergency LowIncome Housing Preservation Act of 1987 or the Low-Income Housing Preservation and Resident Homeownership Act of 1990. Projects
receiving financial assistance under such Acts are not eligible for
assistance under this section.".
(e) OWNER CONTRIBUTIONS.—Section 201(kX2) of the Housing
and Commimity Development Amendments of 1978 is amended—
(1) in subparagraph (B), bv striking "and";
(2) in subparagraph (C), by striking the period and inserting "; and"; ana
(3) by adding at the end the foUovdng new subparagraph:
"(D) the Secretary shall give owners credit for advances
made to the project during a 3-year period prior to the
application for assistance.".
(f) COORDINATION OF ASSISTANCE.—Section 201 of the Housing
and Commimity Development Amendments of 1978, as amended
by this section, is further amended by adding at the end the
following new subsection:
"(p) The Secretary shall coordinate the allocation of assistance
imder this section with assistance made available imder section

106 STAT. 3778

PUBLIC LAW 102-550—OCT. 28, 1992

8(v) of the United States Housing Act of 1937 and section 203
of this Act to enhance the cost effectiveness of the Federal response
to troubled multifamily housing.".
SEC. 406. FLEXIBLE SUBSIDY PROGRABl

Section 201(dX6) of the Housing and Community Development
Amendments of 1978 (12 U.S.C. 1715z-la(dX6)) is amended by
inserting before the period at the end the following: "; and except
that the Secretary snail review and approve or disapprove each
plan not later than the expiration of tne 30-day perioa beginning
upon the date of submission of the plan to the Secretary by the
owner, but if the Secretary fails to inform the owner of approval
or disapproval of the plan within such period the plan shall be
considered to have been approved".
SEC. 407. CAPACITY STUDY.

Section 110(a) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12710(a)) is amended—
(1) by striking ", and"; and
(2) by striking the period at the end and inserting the
following: ", and the ability to respond to areas identified as
'material weaknesses' by the Office of the Inspector General
in financial audits or other reports.".
SEC. 408. FLEXIBLE SUBSIDY PROGRAM.
(a) AUTHORIZATION OF APPROPRIATIONS.—Section

201(jX5) of
the Housing and Community Development Amendments of 1978
(12 U.S.C. 1715z-la(iX5)) is amended to read as follows:
"(5) There is authorized to be appropriated for assistance imder
the flexible subsidy fund not to exceed $52,200,000 for fiscal year
1993 and $54,392,400 for fiscal year 1994.".
(b) USE OF SECTION 236 RENTAL ASSISTANCE FUND AMOUNTS

FOR FLEXIBLE SUBSIDY PAYMENTS.—Section 236(0(3) of the National
12USC1715Z-1. Housing Act (12 U.S.C. 1715z-la(0(3)) is amended by striking
"September 30,1992" and inserting "September 30,1994".

TITLE V—MORTGAGE INSURANCE AND
SECONDARY MORTGAGE MARKET
Subtitle A—^FHA Mortgage Insurance
Programs
SEC. 50L L I M I T A T I O N ON I N S U R A N C E AUTHORITY.

Section 531(b) of the National Housing Act (12 U.S.C. 1735f9(b)) is amended to read as follows:
"(b) Notwithstanding any other provision of law and subject
only to the absence of qualified requests for insurance, to the
authority provided in this Act, and to the limitation in subsection
(a), the Secretary shall enter into commitments to insure mortgages
imder this Act with an aggregate principal amount of
$65,905,824,960 during fiscal year 1993 and $68,673,868,600 during
fiscal year 1994.".
SEC. 502. FEDERAL HOUSING ADMINISTRATION ADVISORY BOARD.

Section 202(b) of the National Housing Act (12 U.S.C. 1708(b))
is amended by adding at the end the following new paragraph:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3779

"(11) The Board shall terminate on January 1, 1995.".
SEC. SOS. MAXIMUM MORTGAGE AMOUNT.

(a) IN GENERAL.—The first sentence of section 203(bX2) of
the National Housing Act (12 U.S.C. 1709(bX2)) is amended to
read as follows: "Involve a principal obligation (including such initial
service charges, appraisal, inspection, and other fees as the Secretary shall approve) in an amount—
"(A) not to exceed the lesser of—
"(i) in the case of a 1-family residence, 95 percent
of the median 1-family house price in the area, as determined by the Secretary; in the case of a 2-family residence,
107 percent of such median price; in the case of a 3family residence, 130 percent of such median price; or
in the case of a 4-family residence, 150 percent of such
median price; or
"(ii) 75 percent of the dollar amoimt limitation determined under section 305(aX2) of the Federal Home Loan
Mortgage Corporation Act (as in efTect on September 30,
1992) for a residence of the applicable size;
except that the applicable dollar amount limitation in effect
for any area imder this subparagraph (A) may not be less
than tne dollar amount limitation in effect imder this section
for the area on May 12,1992; and
"(B) except as otherwise provided in this paragraph (2),
not to exceed an amount equal to the sum of—
"(i) 97 percent of $25,000 of the appraised value of
the property, as of the date the mortgage is accepted for
insurance;
"(ii) 95 percent of such value in excess of $25,000
but not in excess of $125,000; and
"(iii) 90 percent of such value in excess of $125,000.".
(b) ApPLiCABiLiry.—The amendment made by subsection (a) 12 use 1709
shall apply only to mortgages executed on or £ifter January 1, note.
1993.
(c) CONFORMING AMENDMENTS.—
(1) TITLE I—LOANS.—Notwithstending any other provision

of law, section 2(bXl) of the National Housing Act (12 U.S.C.
1703(bXl)) is amended by striking subparagraphs (C), (D), and
(E) and inserting the following new subparagraphs:
"(C) $48,600 if made for the purpose of financing the
purchase of a manufactured home;
"(D) $64,800 if made for the purpose of financing the
)urcha8e of a manufactured home and a suitebly developed
ot on which to place the home; and
"(E) $16,200 if made for the purpose of financing the
purchase, by an owner of a manufactured home which
is the principal residence of that owner, of a suitebly developed lot on which to place that manufactured home, and
if the owner certifies that he or she will place the manufactured home on the lot acquired with such loan within
6 months afi^er the date of such loan.".

{

(2) HOME EQUITY CONVERSION MORTGAGES FOR ELDERLY

HOMEOWNERS.—Section 255(g) of the National Housing Act (12
U.S.C. 1715z-2(Kg)) is amended by striking "for a 1-family
residence" and inserting "for l-feunily residences in the area

106 STAT. 3780

PUBLIC LAW 102-550—OCT. 28, 1992
in which the dwelling subject to the mortgage under this section
is located".
(3) RTC AFFORDABLE HOUSING PROGRAM.—Subparagraphs
(DXii) and (GXH) of section 21A(cX9) of the Federal Home
Loan Bank Act (12 U.S.C. 1441a(cX9)) are each amended by
striking "the applicable dollar amoimt" and all that follows
through "areas)" and inserting the following: "$67,500 in the
case of a 1-family residence, $76,000 in the case of a 2-family
residence, $92,000 in the case of a 3-family residence, and
$107,000 in the case of a 4-family residence".
(4) FDIC AFFORDABLE HOUSING PROGRAM.—Paragraphs
(4XB) and (7XB) of section 40(p) of the Federal Deposit Insurance Act (12 U.S.C. 1831q(p)) are each amended to read as
follows:
"(B) that has an appraised value that does not exceed
the amount provided in section 203(bX2XA) of the National
Housing Act except that such amount shall not exceed
$101,250 in the case of a 1-family residence, $114,000
in the case of a 2-family residence, $138,000 in the case
of a 3-family residence, and $160,000 in the case of a
4-family residence."

(d) GAO STUDY ON F H A LOAN LIMITS AND G S E CONFORMING
LOAN LIMITS.—

Reports.

(1) IN GENERAL.—^The Comptroller General of the United
States shall submit to the Congress, on or before September
1, 1993, a report which evaluates the methodology used to
establish the annual conforming loan limits for the secondary
market, pursuant to section 305(aX2) of the Federal Home
Loan Mortgage Corporation Act, as well as the loan limits
adjustments utilized under the single family mortgage insurance program under section 203 of the National Housing Act.
(2) CONTENTS.—^The report shall—
(A) evaluate the methodology used to determine the
annual adjustment to the conforming loan limit, including
the accuracy of using the Mortgage Interest Rate Survey
(MIRS) in determining the median home sales price each
year;
(B) recommend any legislative or administrative
changes to ensure that the conforming loan limits
accurately reflect market dynamics;
(C) assess the long-term consequences of indexing the
mortgage limits utilized under the FHA section 203(b) single lamily mortgage insurance program to the annual
a(^ustments to the conforming loan limits for the secondary
market;
(D) assess the impact of such annual adjustments on
the ability of the FHA single family insurance program
to serve low and moderate income borrowers; and
(E) recommend alternative measures that could be
employed to ensure that FHA can meet the needs of low
and moderate income families in low and high cost areas
of the country.
SEC. 504. FHA ANNUAL REPORT.

Section 203 of the National Housing Act (12 U.S.C. 1709)
is amended by adding at the end the following:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3781

**(v) ANNUAL REPORT.—The Secretary of Housing and Urban
Development shall submit to the Congress an annuied report on
the single family mortgage insurance program under this section.
Each report shall set forth—
''(1) an analysis of the income groups served by the single
family insurance program, including—
"(A) the percentage of borrowers whose incomes do
not exceed 100 percent of the median income for the area;
"(B) the percentage of borrowers whose incomes do
not exceed 80 percent of the median income for the area;
and
"(C) the percentage of borrowers whose incomes do
not exceed 60 percent of the median income for the area;
"(2) an analysis of the percentage of minority borrowers
annually assisted by the program; the percentage of central
city borrowers assisted and the percentage of rural borrowers
assisted by the program;
"(3) the extent to which the Secretary in canying out
the program has employed methods to ensure that needs of
low and moderate income families, imderserved areas, and
historically disadvantaged groups are served by the program;
and
"(4) the current impediments to having the program serve
low and moderate income borrowers; borrowers from central
city areas; borrowers from rural areas; and minority borrowers.
SEC. 505. MAXIMUM PRINCIPAL OBUGATION OF MORTGAGES FOR
VETERANS.

(a) IN GENERAL.—^The first sentence of the last imdesignated
paragraph of section 203(bX2) of the National Housing Act (12
U.S.C. 1709(bX2)) is amended by striking "Notwithstanding anv
other provision of this paragraph," and inserting "Except with
respect to mortgages executed by mortgagors who are veterans,".
(b) TECHNICAL AMENDMENT.—Section 203(bX9) of the National
Housing Act (12 U.S.C. 1709(bX9)) is amended by striking "(except
in a case to which the next to the last sentence of paragraph
(2) applies)" and inserting "(except with respect to a mortgage
executed by a mortgagor who is a veteran)".
SEC. 506. PREPURCHASE COUNSELING REQUIREMENT.

(a) IN GENERAL.—Section 203(bX2) of the National Housing
Act (12 U.S.C. 1709(bX2)) is amended by inserting at the end
the following new undesignated paragraph:
"Notwithstending any other provision of this paragraph,
the Secretary may not insure, or enter into a commitment
to insure, a mortgage under this section that is executed by
a first-time homebuyer and that involves a principal obligation
(including such initial service charges, appraisal, inspection,
and other fees as the Secretary shall approve) in excess of
97 percent of the appraised value of the property unless the
mortgagor has completed a program of counseling with respect
to the responsibilities and financial management involved in
homeownership that is approved by the Secretory; except that
the Secretory may, in the discretion of the Secretary, waive
the applicability of this requirement.".
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 12 use 1709
shall apply to mortgages for which commitmento for insurance "^^-

106 STAT. 3782

PUBLIC LAW 102-550—OCT. 28, 1992

are issued after the expiration of the 12-month period beginning
on the date of the enactment of this Act.
SEC. 507. AUTHORITY TO DECREASE INSURANCE PREMIUM CHARGES.
(a) PERMANENT PROVISIONS.—Section 203(cX2) of the National

Housing Act (12 U.S.C. 1709(cX2)) is amended—
(1) in subparagraph (A), by striking "equal to" and inserting
"not exceeding"; and
(2) in subparagraph (B)—
(A) in the matter preceding clause (i), by striking "equal
to" and inserting "not exceeding"; and
(B) in clause (ii), by strij^ng "equal to 0.55 percent"
and inserting "not exceeding 0.55 percent".
(b) TRANSITION PROVISIONS.—Section 2103(b) of the Omnibus
Budget Reconciliation Act of 1990 (12 U.S.C. 1709 note) is
amended—
(1) in paragraph (1)—
(A) in subpara^aph (A), by striking "equal to" and
inserting "not exceeding"; and
(B) in subparagraph (B), in the matter preceding clause
(i), by striking "equal to" and inserting "not exceeding";
and
(2) in paragraph (2)—
(A) in subparagraph (A), by striking "equal to" and
inserting "not exceeding"; and
(B) in subparagraph (B), in the matter preceding clause
(i), by striking "equal to" and inserting "not exceeding".
SEC. 508. STATUTE OF LIMITATIONS ON PAYMENT OF DISTRIBUTIVE
SHARES.
(a) DISTRIBUTION OF SHARES.—Section 205(c) of the National

12 use 1711
"°*®-

Housing Act (12 U.S.C. 1711(c)) is amended by adding at the
end the following two new sentences: "The Secretary shall not
distribute any share to an eligible mortgagor imder this subsection
beginning on the date which is 6 years after the date the Secretary
first transmitted written notification of eligibility to the last known
address of the mortgagor, unless the mortgagor has applied in
accordance with procedures prescribed by the Secretary for payment
of the share within the 6-year period. The Secretary shall transfer
any amounts no longer eligible for distribution under the previous
sentence from the Participating Reserve Accoimt to the (jreneral
Surplus Account.".
(b) EXCEPTION.—Notwithstanding the 6-year limitation on distribution of shares of the Participating Reserve Accoimt under
section 205(c) of the National Housing Act, the Secretary shall
distribute a share to an otherwise eligible mortgagor in accordance
with section 205(c), if the mortgagor applies for pa}anent of the
share within 1 year after the date of enactment of this Act in
accordance with procedures in effect on such date.
SEC. 509. MORTGAGE LIMITS FOR MULTIFAMILY PROJECTS.
(a) SECTION 207 LIMITS.—Section 207(cX3) of the

National
Housing Act (12 U.S.C. 1713(cX3)) is amended—
(1) by striking "$25,350", "$28,080", "$33,540", "$41,340",
and "$46,800" and inserting "$30,420", "$33,696", "$40,248",
"$49,608", and "$59,160", respectively; and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3783

(2) by striking "$29,250", "$32,760", "$40,170", "$50,310",
and "$56,885" and inserting "$35,100", "$39,312", "$48,204",
"$60,372", and "$68,262", respectively.
(b) SECTION 213 LIMITS.—Section 213(bX2) of the National

Housing Act (12 U.S.C. 1715e(bX2)) is amended—
(1) by striking "$25,350", "$28,080", "$33,540",
and "$46,800" and inserting "$30,420", "$33,696",
"$49,608", and "$59,160", respectively; and
(2) by striking "$29,250*, "$32,760", "$40,170",
and "$56,885" and inserting "$35,100", "$39,312",
"$60,372", and "$68,262", respectively.
(c)

SECTION

220

LIMITS.—Section

"$41,340",
"$40,248",
"$50,310",
"$48,204",

220(dX3XBXiii)

of

the

National Housing Act (12 U.S.C. 1715k(dX3XBXiii)) is amended—
(1) by striking "$25,350", "$28,080", "$33,540", "$41,340",
and "$46,800" and inserting "$30,420", "$33,696", "$40,248",
"$49,608", and "$59,160", respectively; and
(2) by striking "$29,250*, "$32,760", "$40,170", "$50,310",
and "$56,885" and inserting "$35,100", "$39,312", "$48,204",
"$60,372", and "$68,262", respectively.
(d) SECTION 221(dX3) LIMITS.—Section 221(dX3Xii) of the
National Housing Act (12 U.S.C. 17151(dX3Xii)) is amended by 12USC1715/.
striking "$28,032", "$32,321", "$38,979", "$49,893", "$55,583^
"$29,500", "$33,816", "$41,120", "$53,195", and "$58,392" and inserting "$33,638", "$38,785", "$46,775", "$59,872", "$66,700", "$35,400",
"$40,579", "$49,344", "$63,834", and "$70,070", respectively.
(e) SECTION 221(dX4) LIMITS.—Section 221(dX4Xii) of the
National Housing Act (12 U.S.C. 17151(dX4Xii)) is amended by
striking "$25,228", "$28,636", "$34,613", "$43,446", "$49,231*
"$27,251", "$31,239", "$37,986", "$49,140", and "$53,942" and inserting "$30,274", "$34,363", "$41,536", "$52,135", "$59,077", "$32,701",
"$37,487", "$45,583", "$58,968", and "$64,730", respectively.
(f) SECTION 231 LIMITS.—Section 231(cX2) of the National Housing Act (12 U.S.C. 1715v(cX2)) is amended—
(1) by striking "$23,985", "$26,813", "$32,019", "$38,532",
and "$45,300" and inserting "$28,782", "$32,176", "$38,423",
"$46,238", and "$54,360", respectively; and
(2) by striking "$27,251*, "$31,239", "$37,986", "$49,140",
and "$53,942" and inserting "$32,701", "$37,487", "$45,583",
"$58,968", and "$64,730", respectively.
(g) SECTION 234 LIMITS.—Section 234(eX3) of the National

Housing Act (12 U.S.C. 1715y(eX3)) is amended—
(1) by striking "$25,350", "$28,080", "$33,540", "$41,340",
and "$46,800" and inserting "$30,420", "$33,696", "$40,248",
"$49,608", and "$59,160", respectively; and
(2) by striking "$29,250*, "$32,760", "$40,170", "$50,310",
and "$56,885" and inserting "$35,100", "$39,312", "$48,204",
"$60,372", and "$68,262", respectively.
(h) REGULATIONS.—The Secretary of Housing and Urban Devel- 12 use 1713
opment shall issue regulations necessary to carry out the amend- ^°^ments made by subsections (a) through (g), which shall take effect
not later than the expiration of the 1-year period beginning on
the date of the enactment of this Act.
(i) CONFORMING AMENDMENTS.—Clauses (iXH) and (iiXH) of

section 21A(cX9XE) of the Federal Home Loan Bank Act (12 U.S.C.
1441a(cX9XE)) are each amended by striking "the applicable dollar
amount" and all that follows through "areas)" and inserting the
following: ", for such part of the property as may be attributable

106 STAT. 3784

PUBLIC LAW 102-550—OCT. 28, 1992

to dwelling use (excluding exterior land improvements), $29,500
per family unit without a bedroom, $33,816 per family unit with
1 bedroom, $41,120 per family unit with 2 bedrooms, $53,195 per
family unit with 3 bedrooms, and $58,392 per family vmit with
4 or more bedrooms".
SEC. 510. INSURANCE OF LOANS FOR OPERATING LOSSES OF MULTIFAMILY PROJECTS.

Section 223(d) of the National Housing Act (12 U.S.C. 1715n(d))
is amended by adding at the end the following new paragraph:
"(6) In determining the amount of an operating loss loan to
be insured pursuant to this subsection, the Secretary shall not
reduce such amount solely to reflect any amoimts placed in escrow
(at the time the existing project mortgage was insured) for initial
operating deficits. If an operating loss loan was insured by the
Secretary pursuant to this subsection before the date of the enactment of the Housing and Community Development Act of 1992
and was reduced solely to reflect the amount placed in escrow
for initial operating deficits, the Secretary shall insure, to the
extent of the availability of insurance authority provided in appropriation Acts, an increase in the existing loan or a separate loan,
in an amoimt equal to the lesser of (A) the maximum amount
permitted imder this subsection and the applicable underwriting
requirements esteblished by the Secretory and in effect at the
time the loan is to be made, or (B) the amount of the escrow
for initial operating deficits.".
SEC. 611. EUCraiUTY OF ASSISTED LIVING FACIUTIES FOR MORTGAGE INSURANCE UNDER SECTION 232.

(a) PURPOSE.—Section 232(a) of the National Housing Act (12
U.S.C. 1715w(a)) is amended—
(1) in the matter preceding paragraph (1), by striking
"either" and inserting "anjr"; and
(2) by adding at the end the following new paragraph:
"(3) The development of assisted living facilities for the
care of frail elderly persons.".
(b) DEFINITIONS.—Section 232(b) of the National Housing Act
(12 U.S.C. 1715w(b)) is amended—
(1) in paragraph (4), by striking "and" at the end;
(2) in paragraph (5), by striking the period at the end
and inserting a semicolon; and
(3) by adding at the end the following new paragraphs:
"(6) the term'assisted living facility means a public facility,
proprietory facility, or facility of a private nonprofit corporation
that^
"(A) is licensed and regulated by the Stote (or if there
is no State law providing for such licensing and regulation
by the Stote, by the municipality or other political subdivision in which the facility is located);
"(B) makes available to residente supportive services
to assist the residente in carrying out activities of daily
living, such as bathing, dressing, eating, getting in and
out of bed or chairs, walking, going outdoors, using the
toilet, laimdry, home management, preparing meals, shopping for personal items, obtoining and taking medication,
managing money, using the telephone, or performing light
or heavy housework, and which may make available to

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3785

residents home health care services, such as nursing and
therapy; and
"(C) provides separate dwelling units for residents,
each of which may contain a full kitchen and bathroom,
and which includes common rooms and other facilities
appropriate for the provision of supportive services to the
residents of the facility; and
"(7) the term 'frail elderly person' has the meaning given
the term in section 802(k) of the Cranston-Gonzalez National
Affordable Housing Act.".
(c) MORTGAGE REQUIRISMENTS.—Section 232(d) of the National
Housing Act (12 U.S.C. 1715w(d)) is amended—
(1) in the matter preceding paragraph (1)—
(A) by inserting ", assisted living facility," before **or
intermediate care facility";
(B) by striking "combined niu>sing home and intermediate care facilitjr" and inserting "any combination of nursing
home, assisted living facility, and intermediate care facility"; and
(C) by inserting after "intermediate care facility^ the
first place it appears the following: ", including a new
addition to an existing nursing home, assisted living facility, or intermediate care facility and regardless of whether
the existing home or facility is being rehabilitated,";
(2) in paragraph (2), in the matter preceding subparagraph
(A), by inserting "or 95 percent of the estimated value of the
property or project in the case of a mortgagor that is a private
nonprofit corporation or association (imder the meaning given
such term for purposes of section 221(dX3) of this Act)," before
"including";
(3) in paragraph (3), by adding at the end the following:
"The Secretary shall not promulgate regtdations or establish
terms or conditions that interfere with the ability of the mortgagor and mortgagee to determine the interest rate; and
(4) in paragraph (4), by adding at the end the following
new subparagraph:
"(C) With respect to assisted living facilities or any such
facility combined with any other home or facility, the Secretary
shall not insure any mortgage under this section unless—
"(i) the Secretary determines that the level of financing
acquired by the mortgagor and any other resources available for the facility will be sufficient to ensure that the
facility contains dwelling units and facilities for the provision of supportive services in accordance with subsection
(bX6);
"(ii) the mortgagor provides assurances satisfactory to
the Secretary that each dwelling unit in the facility will
not be occupied by more than 1 person without the consent
of all such occupante; and
"(iii) the appropriate State licensing agency for the
State, municipality, or other political subdivision in which
the facility is or is to be located provides such assurances
as the Secretary considers necessary that the faciUty will
comply with any applicable stcmdards and requirements
for such facilities.".

106 STAT. 3786

Reports.

PUBLIC LAW 102-550—OCT. 28, 1992

(d) FIRE SAFETY EQUIPMENT.—Section 232(iXl) of the National
Housing Act (12 U.S.C. 1715w(iXl)) is amended by inserting
", assisted living facilities," after "nursing homes".
(e) ADMINISTRATION.—Section 232 of the National Housing Act
(12 U.S.C. 1715w) is amended by adding at the end the following
new subsection:
"(j) The Secretary shall estabUsh schedules and deadlines for
the processing and approval (or provision of notice of disapproval)
of applications for mortgage insurance imder this section. The Secretary shall submit a report to the Congress annually describing
such schedules and deadlines and the extent of compliance by
the Department with the schedules and deadlines during the year.".
(f) AUTHORITY TO INSURE REFINANCING.—Section 223(f) of the

National Housing Act (12 U.S.C. 1715n(f)) is amended by inserting
"existing assisted Uving facility," after "existing nursing home,"
each place it appears.
SEC. S12. EXPEDITING INSURANCE FOR ACQUISITION OF RESOLUTION TRUST CORPORATION PROPERTY.
(a) IN GENERAL.—Section 534 of the National Housing Act
(12 U.S.C. 1735f-12) is amended—
(1) by inserting "(a) STATE OFFICES.—" after "534."; and
(2) by adding at the end the following new subsection:
"(b) EXPEDITED PROCEDURE FOR R T C PROPERTIES.—TO assist

Regulations.
12 use
1735f-12.

42 use 12712
note.

the Resolution Trust Corporation in disposing of the property to
which it acquires title and to ensure the timely processing of
applications for insurance of loans and mortgages under this Act
that will be used to purchase multifamily residential property from
the Resolution Trust Corporation, the Secretary shall establish
an expedited procedure for considering such applications.".
(b) IMPLEMENTATION.—^The procedure referred to in the amendment made by subsection (a) shall be established through interim
and final regulations issued by the Secretary. The Secretary shall
issue interim regulations implementing the procedure not later
than the expiration of the 90-day period beginning on the date
of the enactment of this Act, which shall be effective upon issuance.
The Secretary shall issue final regulations after notice and opportunity for public comment pursuant to the provisions of section
553 of title 5, United States Code (notwithstanding subsections
(aX2), (bXB), and (dX3) of such section).
SEC. 513. ENERGY EFFICIENT MORTGAGES PILOT PROGRAM.
(a) ESTABUSHMENT OF PILOT PROGRAM.—
(1) IN GENERAL.—Not later than 6 months after the date
of enactment of this Act, the Secretary of Housing and Urban
Development (hereeifter referred to as the "Secretary^) shall
establish an energy efficient mortgage pilot program in 5 States,
to promote the purchase of existing energy efficient residential
buildings and the installation of cost-effective improvements
in existing residential buildings.
(2) PILOT PROGRAM.—^The pilot program established under
this subsection shall include the following criteria, where
' applicable:
(A) ORIGINATION.—^The lender shall originate a housing
loan that is insured under title II of the National Housing
Act in accordance with the applicable requirements.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3787

(B) APPROVAL.—^The mortgagor's base loan application
shall be approved if the mortgagor's income and credit
record is found to he satisfactory.
(C) COST OF DVIPROVEMENTS.—The cost of cost-effective

energy efficiency improvements shall not exceed the greater
of—
(i) 5 percent of the property value (not to exceed
$8,000); or
(ii) $4,000.
(3) AUTHORITY FOR MORTGAGEES.—In granting mortgages
under the pilot program established pursuant to this subsection,
the Secretary shall grant mortgagees the authority—
(A) to permit the final loan amount to exceed the
loan limits established under title II of the National Housing Act by an amount not to exceed 100 percent of the
cost of the cost-effective energy efficiency improvements,
if the mortgagor's request to add the cost of such improvements is received by the mortgagee prior to funding of
the base loan;
(B) to hold in escrow all funds provided to the mortgagor to undertake the energy efficiencv improvements until
the efficiency improvements are actually installed; and
(C) to transfer or sell the energy efficient mortgage
to the appropriate secondary market agency, £iff;er the mortgage is issued, but before the energy efficiency improvements are actually installed.
(4) PROMOTION OF PILOT PROGRAM.—The Secretary shall
encourage participation in the energy efficient mortgage pilot
program by—
(A) making available information to lending agencies
and other appropriate authorities regarding the availability
and benefits of energy efficient mortgages;
(B) requiring mortgagees and designated lending
authorities to provide written notice of the availability
and benefits of the pilot program to mortgagors appljdng
for financing in those States designated by the Secretary
as participating under the pilot program; and
(C) requiring each applicant for a mortgage insured
under title II of the National Housing Act in those States
participating under the pilot program to sign a statement
that such applicant has been informed of the program
requirements and understands the benefits of energy efficient mortgages.
(5) TRAINING PROGRAM.—Not later than 9 months after Establishment.
the date of enactment of this Act, the Secretary, in consultation
with the Secretary of Energy, shall establish and implement
a program for training personnel at relevant lending agencies,
real estate companies, and other appropriate organizations
regarding the benefits of energy efficient mortgages and the
operation of the pilot program under this subsection.
(6) REPORT.—^Not later than 18 months £ift«r the date of
enactment of this Act, the Secretary shall prepare and submit
a report to the Congress describing the effectiveness and
implementation of the energy efficient mortgage pilot program
as described under this subsection, and assessing the potential
for expanding the pilot program nationwide.

106 STAT. 3788
Reports.

PUBLIC LAW 102-550—OCT. 28, 1992

(b) EXPANSION OF PROGRAM.—Not later than the expiration
of the 2-year period beginning on the date of the implementation
of the energy efficient mortgage pilot program under this section,
the Secretary of Housing and Urban Development shall expand
the pilot program on a nationwide basis and shall expand the
program to include new residential housing, unless the Secretary
determines that either such expansion would not be practicable
in which case the Secretary shaU submit to the Congress, before
the expiration of such period, a report explaining why either expansion would not be practicable.
(c) DEFINITIONS.—^For purposes of this section:
(1) The term 'Ibase loan" means any mortgage loan for
a residential building eligible for insurance under title II of
the National Housing Act or title 38, United States Code,
that does not include the cost of cost-effective energy
improvements.
(2) The term "cost-effective" means, with respect to energy
efSicienQT improvements to a residential building, improvements
that result in the total present value cost of the improvements
(including any maintenance and repair expenses) being less
than the total present value of the energy saved over the
useful life of the improvement, when 100 percent of the cost
of improvements is added to the base loan. For purposes of
this paragraph, savings and cost-effectiveness shall be determined pursuant to a home energy rating report sufficient for
purposes of the Federal National Mortgage Association and
the Federal Home Loan Mortgage Corporation, or by other
technically accurate methods.
(3) The term "energy efficient mortgage" means a mortgage
on a residential building that recognizes the energy savings
of a home that has cost-effective energy saving construction
or improvements (including solar water heaters, solar-assisted
air conditioners and ventilators, super-insulation, and insulating glass and film) and that has the effect of not disqualifying
a borrower who, but for the expenditures on energy saving
construction or improvements, would otherwise have qualified
for a base loan.
(4) The term "residential building" means any attached
or unattached single family residence.
(d) RULE OF CONSTRUCTION.—^This section may not be construed
to affect any other programs of the Secretary of Housing and
Urban Development for energy-efficient mortgages. The pilot program carried out imder this section shall not replace or result
in the termination of such other programs.
(e) REGULATIONS.—^The Secretary shall issue any regulations
necessary to carry out this section not later than the expiration
of the 180-day period beginning on the date of the enactment
of this Act. The regulations shall be issued after notice and opportunity for public comment pursuant to the provisions of section
553 of title 5, United States Code (notwithstanding subsections
(aX2), (bXB), and (dX3) of such section).
(f) AUTHORIZATION OF APPROPRIATIONS.—^There are authorized
to be appropriated such sums as may be necessary to carry out
this section.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3789

SEC. 514. STUDY REGARDING HOME WARRANTY PLANS.

(a) I N GENERAL.—^The Secretary of Housing and Urban Development (hereafter in this section referred to as the "Secretary") shall
conduct a study of home and builder's warranties and protection
plans regarding the construction of, and materials used in, 1- to
4-family dwellings subject to mortgages insured under title II of
the National Housing Act.
(b) SCOPE OF STUDY.—The study shall analyze—

(1) the extent to which home sellers and builders use
such warranties and plans,
(2) how such warranties and plans aftect the single family
mortgage insurance program imder the National Housing Act
and the solvency of the Mutual Mortgage Insurance Fund,
(3) any effects on homeowners of reliance upon such
warranties and plans,
(4) the cost of inspections of mortgaged homes not covered
by such warranties or plans,
(5) how quickly the issuers of such warranties and plans
pay claims to homeowners under the warranties and plans,
(6) how well such warranties and plans provide for the
prevention of structural damage before damage occurs,
(7) how responsive the issuers are to homeowner
complaints,
(8) the extent to which homeowners are adequately
informed of the extent of insurance coverage, the complaint
procedures, and the arbitration procedures available to them
under such warranties and plans,
(9) the extent to which the arbitration process used to
settle claims under such warranties and plans provides fair
and reasonable relief for homeowners,
(10) how well homeowners are informed of their right to
appeal the decision of such arbitrators to the Secretary,
(11) whether the reporting and inspection requirements
to which such warranties and plans are subject provide the
Secretary with sufficient information to verify that such
warranties and plans are acceptable,
(12) whether dwellings covered by such warranties and
plans satisfy all requirements which would have been applicable
if such dwellings had been approved for mortgage insurance
by the Secretary before the beginning of construction, and
(13) any other issues relating to such warranties and plans
that the Secretary considers appropriate.
(c) REPORT.—^The Secretary shall submit a report to the Congress regarding the findings of the study and any recommendations
of the Secretary resulting from the study, not later than the expiration of the 12-month period beginning on the date of the enactment
of this Act.
SEC. 515. EXPENDITURES TO CORRECT DEFECTS.

Section 518(a) of the National Housing Act (12 U.S.C. 1735b(a))
is amended—
(1) by redesignating paragraphs (1) through (3) as subparagraphs (A) through (C), respectively; and
(2) by striking out 'The Secretary" and all that follows
through "make expenditures for" and inserting in lieu thereof
the following:

12 USC 1701J-1

106 STAT. 3790

PUBLIC LAW 102-550—OCT. 28, 1992
''(1) The Secretary is authorized to make expenditures
imder this subsection with respect to any property that—
"(A) is a condominium imit (including common areas)
or is improved by a one-to-four family dwelling;
"(B) was approved, before the beginning of construction,
for mortgage insurance imder this Act or for guaranty,
insurance, or direct loan under chapter 37 of title 38,
United States Code, or was less than a year old at the
time of insurance of the mortgage and was covered by
a consumer protection or warranty plan acceptable to the
Secretary; and
"(C) the Secretary finds to have structural defects.
"(2) Expenditures under this subsection may be made for^.

SEC. 516. PAYMENT OF MORTGAGE INSURANCE CLAIMS.
(a) PAYMENT OP INSURANCE.—Section 204 of the National Hous-

ing Act (12 U.S.C. 1710) is amended—
(1) in the fifth sentence of subsection (a), by striking
", subject to the cash adjustment hereinafi^r provided, issue
to the mortgagee debentures having a total face value" and
insert in lieu thereof the following: "issue to the mortgagee
debentures having a par value";
(2) by striking subsection (c) and inserting the following:
"(c) Debentures issued under this section—
"(1) shall be in such form and amoimts;
"(2) shall be subject to such terms and conditions;
"(3) shall include such provisions for redemption, if any,
as may be prescribed by the Secretary of Housing and Urban
Development, with the approval of the Secretary of the Treasury; and
"(4) may be in book entrv or certificated registered form,
or such other form as the ^cretary of Housing and Urban
Development may prescribe in regulations.";
(3) in the first sentence of subsection (d)—
(A) by striking "executed" and inserting "issued"; and
(B) by striking ", shall be simed by the Secretary
by either his written or engraved signature, and shall
be negotiable" and inserting the following: "and shall be
negotiable, and, if in book entry form, transferable, in
the manner described by the Secretary in regulations";
and
(4) by striking in the fifth sentence of subsection (d) "and
such guarantjr" and inserting the following: "and, in the case
of debentures issued in certificated registered form, such
guaranty".
(b) RENTAL HOUSING INSURANCE.—Section 207 of the National
Housing Act (12 U.S.C. 1713) is amended—
(1) by striking in the second sentence of subsection (g)
", subject to the cash adjustment provided for in subsection
(j)> issue to the mortgagee a certificate of claim as provided
in subsection (h), and debentures having a total face value"
and inserting the following: "issue to the mortgagee a certificate
of claim as provided in subsection (h), and debentures having
a par value";
(2) by striking in the first sentence of subsection (i) "shall
be signed by the Secretary, by either his written or engraved
signature, shall be negotiable" and inserting the following:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3791

''shall be negotiable, and, if in book entry form, transferable,
in the manner described by the Secretary in regulations";
(3) by striking in the fourth sentence of subsection (i)
"and such guaranty^ £Uid inserting the following: "and, in the
case of debentures issued in certificated registered form, such
guaranty"; and
(4) by striking subsection (j) and inserting the following:
"(j) Debentures issued under this section—
"(1) shall be in such form and amounts;
"(2) shall be subject to such terms and conditions;
"(3) shall include such provisions for redemption, if any,
as may be prescribed by the Secretary of Housing and Urban
Development, with the approval oi the Secretary of the
Treasury; and
"(4) may be in book entry or certificated registered form,
or such other form as the Secretary of Housing and Urban
Development may prescribe in regulations.".
(c) REHABILITATION AND NEIGHBORHOOD CONSERVATION HOUS-

ING INSURANCE.—Section 220(h) of the National Housing Act (12
U.S.C. 1715k) is amended—
(1) by striking in the first sentence of paragraph (7), "shall
be signed by the Secretary, by either his written or engraved
signature, shall be negotiable" and inserting the following:
"shall be negotiable, and, if in book entry form, transferable,
in the manner described by the Secretary in regulations";
(2) by striking in the fourth sentence of paragraph (hX7)
"and the guaranty" and inserting the following: "and, in the
case of debentures issued in certificated registered form, the
guaranty';
(3) by striking the sixth sentence of paragraph (7), and
inserting the following: "Debentures issued imder this subsection shall be in such form and amounts; shall be subject
to such terms and conditions; and shall include such provisions
for redemption, if any, as may be prescribed by the Secretary
of Housing and Urban Development, with the approval of the
Secretary of the Treasury; and may be in book entry or certificated registered form, or such other form as the Secretary
of Housing and Urban Development may prescribe in regulations."; and
(4) by striking the last sentence of paragraph (7).
(d) HOUSING FOR MODERATE INCOME AND DISPLACED FAMI-

LIES.—^The second sentence of section 221(gX4XA) of the National
Housing Act (12 U.S.C. 17151(gX4XA)) is amended by striking 12USC1715/.
", subject to the cash a4justment provided herein, issue to the
mortgagee debentures having total face value" and inserting the
following: "issue to the mortgagee debentures having a par value".
SEC. 517. COVERAGE OF
CLOSUREACT.

THE

MULTIFAMILY

MORTGAGE

FORE-

(a) PURPOSES.—Section 362 of the Multifamily Mortgage Foreclosure Act of 1981 (12 U.S.C. 3701) is amended—
(1) in subsection (aXD, by striking "real estate" and all
that follows through "properties" and inserting: "multifamily
mortgages"; and
(2) in subsection (b), by striking "multiimit" and all that
follows through "1964" and inserting "miiltifamily mortgages".

106 STAT. 3792

V

PUBLIC LAW 102-550—OCT. 28, 1992

(b) DEFINITION.—Section 363(2) of the Multifamily Mortgage
Foreclosure Act of 1981 (12 U.S.C. 3702(2)) is amended to read
as follows:
"(2) 'multifamily mortgage' means a mortgage held by the
Secretary pursuant to—
"(A) section 608 or 801, or title II or X, of the National
Housing Act;
"(B) section 312 of the Housing Act of 1964, as it
existed immediately before its repeal bv section 289 of
the Cranston-Cjronzalez National Affordable Housing Act;
"(C) section 202 of the Housing Act of 1959, as it
existed immediately before its amendment by section 801
of the Cranston-Gonzalez National Affordable Housing Act;
"(D) section 202 of the Housing Act of 1959, as amended
by section 801 of the Cranston-Cxonzalez National Affordable Housing Act; and
"(E) section 811 of the Cranston-Cronzalez National
Affordable Housing Act.".
(c) PREREQUISITES TO FORECLOSURE.—-The last sentence of section 366 of the Multifamily Mortgage Foreclosure Act of 1981 (12
U.S.C. 3705) is amended by striking "status" and all that follows
through "rents" and inserting the following: "status, relief under
an assignment of rents, or transfer to a nonprofit entity pursuant
to section 202 of the Housing Act of 1959 (as amended by section
801 of the Cranston-Gonzalez National Affordable Housing Act)
or section 811 of the Cranston-Gronzalez National Affordable Housing Act".
(d) NOTICE.—Section 367(b)(1) of the Multifamily Mortgage
Foreclosure Act of 1981 (12 U.S.C. 3706(b)(1)) is amended to read
as follows:
"(b)(1) Except as provided in paragraph (2XA), the Secretary
may require, as a condition and term of sale, that the purchaser
at a foreclosure sale under this part agree to continue to operate
the security property in accordance with the terms of the program
under which the mortgage insurance or assistance was provided,
or any applicable regulatory or other agreement in effect with
respect to such property immediately prior to the time of foreclosure
sale.".
SEC. 518. MORTGAGEE REVIEW BOARD.

Section 202(c)(3XC) of the National Housing Act (12 U.S.C.
1708(c)(3)(C)) is amended—
(1) by inserting "temporariljr" £ifter "order";
(2) by inserting "(i)" after "Administration if";
(3) by inserting "(ii)" after "violations and"; and
(4) by striking the period after "6 months" and inserting
the following: ", and for not longer than 1 year. The Board
may extend the suspension for an additional 6 months if it
determines the extension is in the public interest. If the Board
and the mortgagee agree, these time limits may be extended.".
SEC. 519. DEFINITION O F MORTGAGEE.

Section 202(c) of the National Housing Act (12 U.S.C. 1708(c))
is amended—
(1) by striking paragraph (6)(D); and
(2) by redesignating paragraph (7) as paragraph (8), and
inserting the following after paragraph (6):

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3793

"(7) DEFINITION OF'MORTGAGEE'.—For purposes of this subsection, the term 'mortgagee' means—
"(A) a mortgag(}e approved under this Act;
"(B) a lender or a loan correspondent approved under
title I of this Act;
"(C) a branch office or subsidiary of the mortgagee,
lender, or loan correspondent; or
"(D) a director, officer, employee, agent, or other person
participating in the conduct of the affairs of the mortgagee,
lender, or loan correspondent.".
SEC. 520. EXEMPTION FROM SECTION 137(b) OF THE TRUTH IN LENDINGACT.
Section 255(j) of the National Housing Act (12 U.S.C. 1715z20(j)) is amended by adding at the end the following: "Section
137(b) of the Truth in Lending Act (15 U.S.C. 1647(b)) and any
implementing regulations issued by the Board of Governors of the
Federal Reserve System shall not apply to a mortgage insured
under this section.".

Subtitle B—Secondary Mortgage Market
Programs
SEC. 531. LIMITATION ON GNMA GUARANTEES
BACKED SECURITIES.

OF MORTGAGE-

Section 306(gX2) of the Federal National Mortgage Association
Charter Act (12 U.S.C. 1721(gX2)) is amended to read as follows:
"(2) Notwithstanding any other provision of law and subject
only to the absence of qualified requests for guarantees, to the
authority provided in this subsection, and to the extent of or in
such amounts as any funding limitation approved in appropriation
Acts, the Association shall enter into commitments to issue guarantees under this subsection in an aggregate amount of
$88,000,000,000 during fiscal year 1993 and $91,696,000,000 during
fiscal year 1994. There is authorized to be appropriated such sums Appropriation
as may be necessary to cover the costs (as such term is defined authorization.
in section 502 of the Congressional Budget Act of 1974) of guarantees issued under this Act by the Association.".
SEC. 532. AUTHORITY FOR GNMA TO MAKE HARDSHIP INTEREST PAYMENTS.

Section 306(gXl) of the Federal National Mortgage Association
Charter Act (12 U.S.C. 1721(gXl)) is amended by inserting after
the period at the end of the third sentence the following new
sentence: "In any case in which (I) Federal law requires the reduction of the interest rate on any mortgage backing a security guaranteed under this subsection, (II) the mortgagor under the mortgage
is a person in the military service, and (III) the issuer of such
security fails to receive from the mortgagor the full amount of
interest pajnnent due, the Association may make pa3rments of
interest on the security in amounts not exceeding the difference
between the amount payable under the interest rate on the mortgage and the amount of interest actually paid by the mortgagor.".

106 STAT. 3794
Multifamily
Housing Finance
Improvement
Act
12 u s e 1707.

PUBLIC LAW 102-550—OCT. 28, 1992

Subtitle C—^Improvement of Financing for
Multifamily Housing
SEC. 541. SHORT TITLE.

This subtitle may be cited as the 'Multifamily Housing Finance
Improvement Act".
SEC. 542. MULTIFAMILY MORTGAGE CREDIT DEMONSTRATIONS.

(a) IN GENERAL.—^The Secretary of Housing and Urban Development (hereinafter referred to as the "Secretaiy) shall carry out
programs through the Federal Housing Administration to demonstrate the efTectiveness of providing new forms of Federal credit
enhctncement for multifamilv loans, m carrying out demonstration
programs, the Secretary shall include an evaluation of the effectiveness of entering into partnerships or other contractual arrangements including reinsurance and risk-sharing agreements with
State or local housing finance agencies, the Federal Housing
Finance Board, the Federal National Mortgage Association, the
Federal Home Loan Mortgage Corporation, qualified financial
institutions, and other State or local mortgage insurance companies
or bank lending consortia.
(b) RISK-SHARING PILOT PROGRAM.—

i

(1) IN GENERAL.—^The Secretaiy shall carry out a pilot
program through the Federal Housing Administration to provide for risk sharing related to mortgages on multifamily
housing.
(2) AUTHORITY FOR REINSURANCE AGREEMENTS.—The Secretary may enter into reinsurance agreements (as such term
is defined in section 544) with the Federal National Mortgage
Association, the Federal Home Loan Mortgage Corporation,
qualified financial institutions, qualified housing finance agencies, and the Federal Housing Finance Board. The agreements
may provide for risk-sharing and other forms of credit enhancement with respect to mortgage lending on multifamily housing,
including reinsurance with respect to pools of loans on multifamily housing properties, that the Secretary determines to
be appropriate to carry out the purposes of this subsection.
The agreements shall be in a form and have such terms and
conditions as the Secretary determines to be appropriate to
carry out the piuposes of this subsection.
(3) DEVELOPMENT OF ALTERNATIVES.—The Secretary shall
develop and assess a variety of risk-sharing alternatives, including arrangements under which the Secretary assumes an appropriate share of the risk related to long-term mortgage loans
on newly constructed or acquired multifamily rent^ housing,
mortgage refinancings, bridge financing for construction, and
other forms of multifamily housing mortgage lending that the
Secretary deems appropriate to carry out the purposes of this
subsection. Such alternatives shall be designed—
(A) to ensure that other parties bear a share of the
risk, in percentage amoimt and in position of exposure,
that is sufficient to create strong, market-oriented incentives for other participating parties to maintain sound
underwriting and loan management practices;
(B) to develop credit mechanisms, including sound
underwriting criteria, processing methods, and credit

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3795

enhancements, through which resources of the Federal
Housing Administration can assist in increasing multifamily housing lending as needed to meet the expected need
in the United States;
(C) to provide a more adequate supply of mortgage
credit for sound multifamily rental housing projects m
underserved urban and rural markets;
(D) to encourage m£gor financial institutions to expand
their participation in mortgage lending for sound multifamily housing, through means such as mitigating uncertainties regarding actions of the Federal Government (including
the possible failure to renew short-term subsidy contracts);
(E) to increase the efficiency, and lower the costs to
the Federal Government, of processing and servicing multifamily housing mortgage loans insured by the Federal
Housing Administration; and
(F) to improve the qualify and expertise of Federal
Housing Administration staff and other resources, as
required for sound management of reinsureuice and other
market-oriented forms of credit enhancement.
(4) ELIGIBILITY STANDARDS.—The Secretary shall establish
and enforce st€indards for financial institutions and entities
to be eligible to enter into reinsurance agreements under this
subsection, as the Secretary determines to he appropriate.
(5) FUNDING.—^Using any authority provided in appropriation Acts to insure loans imder the National Housing Act,
the Secretary may enter into commitments under this subsection for risk sharing with respect to mortgages on not more
than 15,000 units over fiscal years 1993 and 1994. The demonstration authorized under this subsection shall not be
expanded until the reports required under subsection (d) are
submitted to Congress.
(6) FEES.—^The Secretary shall establish and collect premimns and fees under this subsection as the Secretary determines appropriate to (A) achieve the purpose of this subsection,
and (B) compensate the Federal Housing Administration for
the risks assumed and related administrative costs.
(7) NON-FEDERAL PARTICIPATION.—The Secretary shall
carry out this subsection, to the maximum extent practicable,
with the participation of well-established residential mortgage
originators, financial institutions that invest in multifamily
housing mortgages, multifamily housing sponsors, and such
other private sector experts in multifamily housing finance
as the Secretary determines to be appropriate.
(8) TIMING.—^The Slecretary shall take any administrative
actions necessary to initiate the pilot program under this subsection not later than the expiration of the 8-month period
beginning on the date of the enactment of this Act.
(c) HOUSING FINANCE AGENCY PILOT PROGRAM.—

(1) IN GENERAL.—^l^'he Secretary shall carry out a specific
pilot program in conjimction with qualified housing finance
agencies to test the effectiveness of Federcd credit enhancement
for loans for affordable multifamily housing through a system
of risk-sharing agreements with such agencies.
(2) PILOT P O R M REQUIREMENTS.—
R G A

(A) IN GENERAL.—In carrying out the pilot program
authorized under this subsection, the Secretary shall enter

106 STAT. 3796

PUBLIC LAW 102-550—OCT. 28, 1992
into risk-sharing agreements with qualified housing finance
agencies.
(B) MORTGAGE INSURANCE.—^Agreements under
subparagraph (A) shall provide for full mortgage insurance
through the Federal Housing Administration of the loans
for affordable multifamily housing originated by or through
qualified housing finance agencies and for reimbursement
to the Secretary oy such agencies for either all or a portion
of the losses incurred on the loans insured.
(C) RISK APPORTIONMENT.—Agreements entered into
under this subsection between the Secretary and a qualified
housing finance agency shall specify the percentage of loss
that each of the parties to the agreement will assume
in the event of default of the insured multifamily mortgage.
Such agreements shall specify that the qualified housing
finance agenqr and the Secretary shall share equally the
full amount of any loss on the insured mortgage.
(D) REIMBURSEMENT CAPACITY.—Agreements entered
into under this subsection between the Secretly and a
qualified housing finance agency shall provide evidence
of the capacity of such agency to fulfill any reimbursement
obligations made pursuant to this subsection. Evidence of
such capacity may include—
(i) a pledge of the full faith and credit of a qualified
State or local agency to fulfill any obligations entered
into by the qualified housing finance agency;
(ii) reserves pledged or otherwise restricted by the
qualified housing finance agency in an amoimt equal
to an agreed upon percentage of the loss assumed
by the housing finance agency under subparagraph
(C);
(iii) fimds pledged through a Stete or local guarantee fond; or
(iv) any other form of evidence mutually agreed
upon by the Secretory and the quaUfied housing
finance agency.
(E) UNDERWRITING STANDARDS.—The Secretai^r shall
allow any qualified housing finance agency to use ite own
imderwnting stondards and loan terms and conditions for
purposes of underwriting loans to be insiu'ed imder this
subsection without further review by the Secretory, except
that the Secretory may impose additional underwriting
critoria and loan torms and conditions for contractu£U
agreemento where the Secretory retoins more than 50 percent of the risk of loss.
(3) MORTGAGE INSURANCE PREMIUMS.—The Secretory shall
estoblish a schedule of insurance premium paymento for mortgages insured under this subsection based on the percentoge
of loss the Secretary may assume. Such schedule shall reflect
lower or nominal premiums for qualified housing finance agencies that assimie a greater share of the risk apportioned according to paragraph (2XC).
(4)

LIMITATION ON INSURANCE AUTHORITY.—Using any

authority provided Inr appropriations Acto to insure mortgages
under the National Housing Act, the Secretory may enter into
commitmente under this subsection with respect to mortgages
on not to exceed 30,000 units over fiscal years 1993, 1994,

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3797

and 1995. The demonstration authorized under this subsection
shall not be expanded until the reports required under subsection (d) are submitted to the Congress.
(5) IDENTITY OF INTEREST.—Notwithstanding any other
provision of law, the Secretary shall not apply identity of.
interest provisions to agreements entered into with qualified
State housing finance agencies under this subsection.
(6) PROHIBITION

ON GINNIE

MAE SECURITIZATION.—^The

Government National Mortgage Association shall not securitize
any multifamily loans insured under this subsection.
(7) QUALIFICATION AS AFFORDABLE HOUSING.—Multifamily

housing securing loans insured under this subsection shall qualify as affordable only if the housing is occupied by very lowincome families and bears rents not greater than the gross
rent for rent-restricted residential units as determined under
section 42(g)(2) of the Internal Revenue Code of 1986.
(8) REGULATIONS.—Not later than 90 days afler the date
of enactment of this Act, the Secretary shall issue such regulations as may be necessary to carry out this subsection.
(d) INDEPENDENT STUDIES AND REPORTS.—
(1) FEDERAL NATIONAL MORTGAGE ASSOCL^TION.—The Fed-

eral National Mortgage Association, in consultation with representatives of its seller-servicers and State housing finance
agencies, shall carry out an independent assessment of alternative methods for achieving the purposes of this section and
shall submit a report containing any findings and recommendations, including any recommendations for legislative or administrative action, simultaneously to the Secretary and the Congress
not later than 12 months after the date of the enactment
of this Act.
(2) FEDERAL HOME LOAN MORTGAGE CORPORATION.—The

Federal Home Loan Mortgage Corporation, in consultation with
representatives of its seller-servicers and State housing finance
agencies, shall carry out an independent assessment of alternative methods for achieving the purposes of this section and
shall submit a report containing any findings and recommendations, including any recommendations for legislative or administrative action, simultaneously to the Secretary and the Congress
not later than 12 months after the date of the enactment
of this Act.
(3) SECRETARY.—The Secretary shall submit to the Congress, and publish, reports under this paragraph assessing
the activities carried out under each of the pilot programs.
The Secretary shall submit and publish a preliminary report
under this paragraph not later than 9 months after the date
of the implementation of each of the pilot programs, and a
final report not later than 24 months after the date of
implementation on which the pilot program is initiated, which
shall include any recommendations by the Secretary for legislative changes to achieve the purposes of this section.
(4) COMPTROLLER GENERAL.—The Comptroller General of

the United States shall carry out an evaluation of each of
the pilot programs under this section and shall submit to the
Congress, not later than 30 months afler the date of
implementation for each of the pilot programs, a report regarding the evaluation, together with any recommendations for
legislative changes to achieve the purposes of this section.

106 STAT. 3798

PUBLIC LAW 102-550—OCT. 28, 1992
The Comptroller Greneral shall also submit to the Congress
a report containing a preliminary assessment of the pilot program not later than 18 months after the date of enactment
of this Act.
(5) FEDERAL HOUSING FINANCE BOARD.—The Federal Housing Finance Board shall monitor and assess the activities carried out under the pilot programs under this section. The
Federal Housing Finance Board shall submit a preliminary
report containing any findings regarding such activities not
later than 9 months after the date of the enactment of this
Act, and a final report containing such findings not later than
24 months after the date on which the pilot program is initiated,
which shall include any recommendations by the Board for
legislative changes to achieve the purposes of this section.

SEC. 543. NATIONAL INTERAGENCY TASK FORCE ON MULTIFAMILY
HOUSING.

(a) PURPOSE.—^The purpose of this section is to establish a
National Interagency Task Force on Multifamily Housing to develop
recommendations for establishing a national database on multifamily housing loans.
(b) ESTABLISHMENT OF TASK FORCE.—There is established a
Task Force known as the National Interagency Task Force on
Multifamily Housing (hereafter in this section referred to as the
"Task Force").
(c) MEMBERSHIP OF TASK FORCE.—
(1) FEDERAL OFFICLVLS.—The Task

of—

Force shall be composed

(A) the Secretary of Housing and Urban Development;
(B) the Chairperson of the Federal Housing Finance
Board;
(C) the Comptroller of the Currency;
(D) the Chairman of the Board of Governors of the
Federal Reserve System;
(E) the Director of the Office of Thrift Supervision;
(F) the Chairperson of the Federal Deposit Insurance
Corporation;
(G) the Chairperson of the Federal National Mortgage
Association; and
(H) the Chairperson of the Federal Home Loan Mortgage Corporation,
or their designees, and the persons appointed under paragraphs
(2) and (3).
(2) APPOINTMENTS BY THE SECRETARY.—The Secretary shall
appoint as members of the Task Force—
(A) 1 individual who is a representative of a State
housing finance agency;
(B) 1 individual who is a representative of a local
housing finance agency;
(C) 1 individual who is a representative of the building
industry with experience in multifamily housing; and
(D) 1 individual who is a representative of the life
insurance industry with experience in multifamily loan
performance data.
(3) APPOINTMENTS BY THE CHAIRPERSON OF THE FHFB.—

The Chairman of the Federal Housing Finance Board shall
appoint as members of the Task Force—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3799

(A) 1 individual who is a representative from the financial services industry with experience in miiltifamily housing underwriting;
(B) 1 individual who is a representative from the nonprofit housing development sector with experience in subsidized multifamily housing development; and
(C) 1 individual who is a representative from a nationally recognized rating agency.
(d) ADMINISTRATION.—

(1) CHAIRPERSONS.—The Task Force shall be chaired jointly
by the Secretary and the Chairman of the Federal Housing
Finance Board.
(2) MEETINGS.—^The Task Force shall meet no less than
4 times, at the call of the Chairpersons of the Task Force.
(3) QUORUM.—^A majority of the members of the Task Force
shall constitute a quorum for the transaction of business.
(4) VOTING.—Each member of the Task Force shall be
entitled to 1 vote, which shall be equal to the vote of every
other member of the Task Force.
(5) VACANCIES.—^Anv vacancy on the Task Force shall not
affect its powers, but shall be nlled in the manner in which
the original appointment was made.
(6) PROHIBITION ON ADDITIONAL PAY.—Members of the Task
Force shall serve without compensation, but shall be
reimbursed for travel, subsistence, and other necessary
expenses incurred in the performance of their duties as members of the Task Force.
(e) FUNCTIONS OF THE TASK FORCE.—

(1) IN GENERAL.—The Task Force shall conduct a multifamily housing financial data project in order to improve the availability and efficiency of financing for multifamily rental
housing. The project shall—
(A) analyze available data regarding the performance
of multifamily housing mortgage loans in all regions of
the coimtry;
(B) prepare a comprehensive national database on the
operation and financing of multifamily housing that will
provide reliable information appropriate to meet the projected needs of lenders, investors, sponsors, property managers, and public officials;
(C) identify important factors that affect the long-term
financial and operational soundness of multifamily housing
properties, including factors relating to project credit risk,
project underwriting, interest rate risk, real estate market
conditions, public subsidies, tax policies, borrower
characteristics, program management standards, and
government policies;
(D) develop common definitions, standards, and procedures that will improve multifamilv housing underwriting
and accelerate the development of a strong, competitive,
and efficient secondary market for multifamily housing
loans; and
(E) make available appropriate information to various
organizations in forms that will assist in improving multifamily housing loan underwriting and servicing.
(2) FINAL REPORT.—Not later than 1 year following the
enactment of this Act, the Task Force shall submit to the

59-194 O—93

6 : QL 3 (Pt. 5)

106 STAT. 3800

PUBLIC LAW 102-550—OCT. 28, 1992
Congress a final report which shall contain the information,
evaluations, and recommendations specified in paragraph (1).
(f) AUTHORITY OF TASK FORCE.—
(1) RULES AND REGULATIONS.—The

Task Force may adopt
such rules and regulations as may be necessary to establish
its procedures and to govern the manner of its operations,
organization and personnel.
(2) ACCESS TO DATA.—The members of the Task Force
representing the Comptroller of the Currency, the Office of
Thrift Supervision, the Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance Corporation,
the Secretary of Housing and Urban Development, the Federal
Housing Finance Board, the Federal National Mortgage
Association, and the Federal Home Loan Mortgage Corporation
shall make available to the Task Force a representative sample
of multifamily housing mortgage loans in order for the Task
Force to make its findings and recommendations, except that—
(A) all information obtained shall be used only for
the purposes authorized in this section;
(B) the Task Force shall maintain the confidentiality
of all such information obtained in the manner established
for the material by the submitting entity, and such data
shall not be subject to release under section 552 of title
5, United States Code;
(C) only aggregate data shall be publicly released by
the Task Force imless it receives the explicit permission
of the mortgage originator or government-sponsored enterprise from which the information is obtained; and
(D) any officer or employee of the Secretary, the Office
of Thrift Supervision, the Board of Grovemors of the Federal
Reserve, the Office of the Comptroller of the Currency,
the Federal Deposit Insurance Corporation, or the Federal
Housing Finance Board shall be subject to the penalties
imder section 1906 of title 18, United States Code, if—
(i) by virtue of employment or official position,
the officer or employee has possession of or access
to any book, record, or information made available
under this subsection and established as confidential
under subparagraph (C); and
(ii) the officer or employee discloses the material
in any manner other than to an officer or employee
of the same Federal agency emplo3dng the officer or
employee, or other than pursuant to the exemptions
under section 1906.
(3) SAMPLE DATA.—In order to ensure a representative
sample of multifamily housing data, the Department of Housing
and Urban Development, the Office of Thrift Supervision, the
Board of Governors of the Federal Reserve System, the Office
of the Comptroller of the Currency, and the Federal Deposit
Insurance Corporation are authorized to request loan data from
a representative sample of mortgage originators or the government-sponsored enterprises regulated by these agencies, and
mortgages originated by housing finance agencies and life insurance companies, except that—
(A) all information obtained shall be used only for
the purposes authorized in this section;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3801

(B) the Task Force shall maintain the confidentiality
of all such information obtained in the manner established
for the material by the submitting entity, and such data
shall not be subject to release under section 552 of title
5, United States Code;
(C) only aggregate data shall be publicly released by
the Task Force unless it receives the explicit permission
of the mortgage originator or government-sponsored enterprise from which the information is obtained; and
(D) any officer or employee of the Secretary, the Office
of Thrift Supervision, the Board of Governors of the Federal
Reserve, the Office of the Comptroller of the Currency,
the Federal Deposit Insurance Corporation, or the Federal
Housing Finance Board shall be subject to the penalties
imder section 1906 of title 18, United States Code, if—
(i) by virtue of employment or official position,
the officer or employee has possession of or access
to any book, record, or information made available
under this subsection and established as confidential
under subparagraph (C); and
(ii) the officer or employee discloses the material
in any manner other than to an officer or employee
of the same Federal agency employing the officer or
employee, or other than pursuant to the exemptions
imaer section 1906.
(4) AGENCY RESOURCES.—The Task Force may, with the
consent of any Federal agency or department represented on
the Task Force, utilize the information, services, staff and
facilities of such agency or department on a reimbursable basis,
to assist the Task Force in carrying out its duties under this
section.
(5) MAILS.—The Task Force may use the United States
mails in the same manner and under the same conditions
as other Federal agencies.
(6) CONfTRACTiNG.-The Task Force may, to such extent
and in such amounts as are provided in appropriations Acts,
enter into contracts with private firms, institutions, and individuals for the purpose of discharging its duties under this section.
(7) STAFF.—The Task Force may appoint and fix the compensation of such personnel as it deems advisable, in accordance
with the provisions of title 5, United States Code, governing
appointments to the competitive service, and the provisions
of chapter 51 and subchapter III of chapter 53 of such title,
relating to classification of General Schediile pay rates.
(g) INDEPENDENT EVALUATION.—The Comptroller General of
the United States shall be authorized to conduct an independent
analysis of the findings and recommendations submitted by the
Task Force to the Congress imder this section.
(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to carry out this section not to exceed $6,000,000
for fiscal year 1993 and $6,252,000 for fiscal year 1994. Funds
appropriated under this subsection shall remain available until
expended.
SEC. 544. DEFINITIONS.

For purposes of this subtitle:

106 STAT. 3802

PUBLIC LAW 102-550—OCT. 28, 1992
(1) The term "multifamily housing" means a property
consisting of more than 4 dwelling units.
(2) l i i e term ''qualified housing finance agency^ means
any State or local housing finance agency that—
(A) carries the designation of top tier" or its equivalent, as evaluated by Standard and Poors or any other
nationally recognized rating agency;
(B) receives a rating of A" for its general obligation
bonds from a nationally recognized rating agency; or
(C) otherwise demonstrates its capacity as a sound
and experienced agency based on, but not limited to, its
experience in financing multifamily housing, fimd balances,
administrative capabilities, investment policy, internal controls and financial management, portfolio quality, and State
or local support.
(3) The term "reinsurance agreement" means a contractual
obligation under which the Secretary, in exchange for appropriate compensation, agrees to assimie a specified portion of
the risk of loss that a lender or other party has previously
assumed with respect to a mortgage on a multifamily housing
property.
(4) The term "Secretary*' means the Secretary of Housing
and Urban Development.

TITLE VI—HOUSING FOR ELDERLY PERSONS AND PERSONS WITH DISABILITIES
Subtitle A—Supportive Housing Programs
Appropriation
authonzation.

SEC. 601. FUNDING FOR SUPPORTIVE HOUSING FOR THE ELDERLY
AND FOR PERSONS WITH DISABIUTIES.
(a) AGGREGATE FUNDING.—There are authorized to be appropriated for the purpose of providing assistance in accordance with
section 202 of the Housing Act of 1959 and section 811 of the
Cranston-Gronzalez National Affordable Housing Act, $1,309,853,000
for fiscal year 1993 and $1,364,866,826 for fiscalyear 1994.
(b) ALLOCATION.—Of any amounts made available for assistance
under the sections referred to in subsection (a), 70 percent of
such amount shall be used for assistance in accordance with section
202 of the Housing Act of 1959 and 30 percent of such amount
shall be used for assistance in accordance with section 811 of
the Cranston-Gonzalez National Affordable Housing Act.
(c) SUPPORTIVE HOUSING FOR THE ELDERLY.—Section 202(1) of
the Housing Act of 1959 (12 U.S.C. 1701q(l)) is amended—
(1) by striking "AUTHORIZATIONS.—" and inserting "ALLOCATION OF FUNDS.—";

(2) in paragraph (1)—
(A) by striking the first sentence and inserting the
following new sentence: "Of any amounts made available
for assistance under this section, such sums as may be
necessaiy shall be available for funding capital advances
in accordance with subsection (cXD-"; and
(B) in the second sentence, by striking "Amounts so
appropriated" and inserting "Such amounts";

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3803

(3) by striking paragraph (2) and inserting the following
new paragraph:
"(2) PROJECT RENTAL ASSISTANCE.—Of any amounts made
available for assistance under this section, such sums as may
be necessary shall be available for funding project rental assistance in accordance with subsection (c)(2).''; and
(4) in paragraph (3), by striking "under this subtitle" and
inserting "for assistance under this section".
(d) SUPPORTIVE HOUSING FOR PERSONS WITH DISABILITIES.—

Section 811(1) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013(1)) is amended—
(1) by striking "AUTHORIZATIONS.—" and inserting "ALLOCATION OF FUNDS.—";

(2) in paragraph (1)—
(A) by striking the first sentence and inserting the
following new sentence: "Of any amounts made available
for assistance under subsection (b), such sums as may
be necessary shall be available for funding capital advances
in accordance with subsection (cXl)."; and
(B) in the second sentence, by striking "Amounts so
appropriated" and inserting "Such amounts";
(3) by striking paragraph (2) and inserting the following
new paragraph:
"(2) PROJECT RENTAL ASSISTANCE.—Of any amounts made
available for assistance under subsection (b), such sums as
may be necessary shall be available for funding project rental
assistance in accordance with subsection (c)(2).";
(4) by redesignating paragraphs (1) and (2) (as so amended)
as paragraphs (2) and (3), respectively; and
(5) by inserting before paragraph (2) (as so redesignated)
the following new paragraph:
"(1) ALLOCATION.—Of any amount made available for
assistance under this section in any fiscal year, an amount
shall be used for assistance under subsection (b) that is not
less than the amount made available in appropriation Acts
for such assistance in the preceding year, and the remainder
shall be available for tenant-based assistance under subsection (n).".
SEC. 602. SUPPORTIVE HOUSING FOR THE ELDERLY.

(a) TECHNICAL CORRECTIONS.—Section 202 of the Housing Act
of 1959 (12 U.S.C. 1701q), as amended by section 801(a) of the
Cranston-(jronzalez National Affordable Housing Act, is amended—
(1) in subsection (g)(1), by striking "and persons with
disabilities"; and
(2) in subsection (i)(l)(A), by striking "persons with disabilities" and inserting "elderly persons".
(b) REPEAL OF REQUIREMENT FOR STATE AND LOCAL CERTIFICATION OF SERVICES.—Section 202(e) of the Housing Act of 1959

(12 U.S.C. 1701q(e)), as amended by section 801(a) of the CranstonGronzalez National Affordable Housing Act, is amended—
(1) by striking paragraph (5); and
(2) by redesignating paragraphs (6) and (7) as paragraphs
(5) and (6), respectively.
(c) SELECTION CRITERL^.—Section 202(f)(2) of the Housing Act
of 1959 (12 U.S.C. 1701q(0(2)) is amended by adding at the end

.

106 STAT. 3804

PUBLIC LAW 102-550—OCT. 28, 1992

", taking into consideration the availability of public housing for
the elderly and vacancy rates in such facilities".
(d) ELDER COTTAGE HOUSING.—

(1) IMPLEMENTATION.—Section 806(b) of the Cranston-Gonzalez National Affordable Housing Act (12 U.S.C. 170 Iq note)
is amended to read as follows:
*'(b) DEMONSTRATION PROGRAM.—

Regulations.

"(1) I N GENERAL.—^The Secretary of Housing and Urban
Development shall carry out a program to determine the feasibility of including, as an eligible development cost under
section 202 of the Housing Act of 1959, the cost of purchasing
and installing elder cottage housing opportunity units that
are small, freestanding, barrier-free, energy efficient, removable, and designed to be installed adjacent to existing 1- to
4-family dwellings. In conducting the demonstration, the Secretary shall determine whether the durability of such units
is appropriate for making such units generally eligible for
assistance under the programs under such sections.
"(2) ALLOCATION.—Notwithstanding any other law, the Secretary shall reserve from any amounts available for capital
advances and project rental assistance under section 202 of
the Housing Act of 1959, amounts sufficient in each of ffscal
years 1993 and 1994 to provide not less than 100 units under
the demonstration under this subsection in connection with
each such section. Any amounts reserved under this paragraph
shall be available only for carrying out the demonstration under
this subsection and, for purposes of the demonstration, the
cost of purchasing and installing an elder cottage housing
opportunity unit shall be considered an eligible development
cost imder sections 202 of the Housing Act of 1959.
"(3) REPORT.—Not later than January 1, 1994, the Secretary shall submit a report to the Congress on the results
of the demonstration under this subsection, which shall be
based on actual experience in implementing this subsection.
«(4) IMPLEMENTATION.—The Secretary shall issue regulations to carry out the demonstration under this subsection
not later than the expiration of the 6-month period beginning
on the date of the enactment of the Housing and Community
Development Act of 1992.".
(e) ACCESS TO RESIDUAL RECEIPTS.—Section 202(j) of the Housing Act of 1959 (12 U.S.C. 1701qO*)) is amended by adding at
the end the following new paragraph:
"(6) ACCESS TO RESIDUAL RECEIPTS.—^The Secretary shall
authorize the owner of a project assisted imder this section
to use any residual receipts held for the project in excess
of $500 per unit (or in excess of such other amount prescribed
by the Secretary based on the needs of the project) for activities
to retrofit and renovate the project described under section
802(d)(3) of the Cranston-Gonzalez National Affordable Housing
Act, to provide a service coordinator for the project as described
in section 802(d)(4) of such Act, or to provide supportive services
(as such term is defined in section 802(k) of such Act) to
residents of the project. Any owner that uses residual receipts
under this paragraph shall submit to the Secretary a report,
not less than annually, describing the uses of the residual
receipts. In determining the amount of project rental assistance
to be provided to a project under subsection (c)(2) of this section.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3805

the Secretary may take into consideration the residual receipts
held for the project only if, and to the extent that, excess
residual receipts are not used under this paragraph.".
(f) WAIVER OF OWNIER DEPOSIT.—Section 202(jX3)(B) of the
Housing Act of 1959 (12 U.S.C. 1701q(jX3)(B)) is amended bv adding
at the end the following new sentence: "The Secretary shall reduce
or waive the requirement of the owner deposit under paragraph
(1) in the case of a nonprofit applicant that is not affiliated with
a national sponsor, as determined by the Secretary.".
(g) NONMETROPOLITAN ALLOCATION.—Section 202(1)(4) of the
Housing Act of 1959 (12 U.S.C. 1701a(l)(3)) is amended by striking
"20 percent" and inserting "15 percent .
SEC. 603. SUPPORTIVE HOUSING FOR PERSONS WITH DISABILITIES.

Section 811(kX6) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 8013(kX6)) is amended—
(1) by striking "incorporated private";
(2) by redesignating subparagraphs (A), (B), and (C), as
subparagraphs (B), (C), and (D), respectively; and
(3) by inserting after "foundation— the following new
subparagraph:
"(A) that has received, or has temporary clearance
to receive, tax-exempt status under section 501(cX3) of
the Internal Revenue Code of 1986;".
SEC. 604. REVISED CONGREGATE HOUSING SERVICES PROGRAM.
(a) AUTHORIZATION OF APPROPRIATIONS.—Section 802(nXl)

of

the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
8011(n)(l)) is amended by striking the matter preceding subparagraph (A) and inserting the following:
"(1) AUTHORIZATION AND USE.—^There are authorized to Appropriation
be appropriated to carry out this section $21,000,000 for fiscal authorization.
year 1993, and $21,882,000 for fiscal year 1994, of which not
more than—".
(b) SUPPLEMENTAL CONTRIBUTIONS.—Section 802(iXlXBXi) of
the Cranston-Gronzalez National Affordable Housing Act (42 U.S.C.
8011(iXlXBXi)) is amended by striking "3-year each place it
appears and inserting "6-vear".
(c) REGULATIONS.—
(1) INTERIM REGULATIONS.—Not

42 u s e son

later than the expiration "°^^
of the 30-day period beginning on the date of the enactment
of this Act, the Secretary of Housing and Urban Development
and the Secretary of Agriculture shall submit to the Congress
a copy of proposed interim regulations implementing section
802 of the Cranston-Gronzalez National Affordable Housing Act
with respect to eligible federally assisted housing (as such
term is defined in section 802(k) of such Act) administered
by each such Secretary. Not later than the expiration of the
45-day period beginning on the date of the enactment of this
Act, but not before the expiration of the 15-day period beginning
upon the submission of the proposed interim regulations to
the Congress, each such Secretary shall publish interim regulations implementing such section 802, which shall take effect
upon publication.
(2) FINAL REGULATIONS.—Not later than the expiration of
the 90-day period beginning upon the publication of interim
regulations under paragraph (1), each such Secretary shall
issue final regulations implementing section 802 of the Cran-

106 STAT. 3806

Appropriation
authonzation.

PUBLIC LAW 102-550—OCT. 28, 1992

ston-Gonzalez National Affordable Housing Act after notice and
opportunity for public comment regarding the interim regulations, pursuant to the provisions of section 553 of title 5,
United States Code (notwithstanding subsections (a)(2), (bXB),
and (d)(3) of such section). The duration of the period for
public comment under such section 553 shall be not less than
60 days, and the final regulations shall take effect upon
issuance.
(3) FAILURE UNDER 1990 ACT.—This subsection may not
be construed to authorize any failure to comply with the
requirements of section 802(m) of the Cranston-Gonzalez
National Affordable Housing Act.
SEC. 606. HOPE FOR ELDERLY INDEPENDENCE.
(a) SECTION 8 ASSISTANCE.—Section 803(j) of the CranstonGonzalez National Affordable Housing Act (42 U.S.C. 8012(j)) is
amended to read as follows:
"(j) SECTION 8 FUNDING.—The budget authority available imder
section 5(c) of the United States Housing Act of 1937 for assistance
under sections 8(b) and 8(o) of such Act is authorized to be increased
by $38,288,000 on or after October 1, 1992, and by $39,896,096
on or after October 1, 1993. The amounts made available under
this subsection shall be used only in connection with the demonstration under this section.
(b) SUPPORTIVE SERVICES AUTHORIZATION.—Section 803(k) of
the Cranston-CJonzalez National Affordable Housing Act (42 U.S.C.
8012(k)) is amended to read as follows:
"(k) FUNDING FOR SERVICES.—There are authorized to be appropnated for the Secretary to carry out the responsibilities for
supportive services under the demonstrations under this section
$10,000,000 to become available in fiscal year 1993, and $10,420,000
to become available in fiscal year 1994. Any such amounts appropriated under this subsection shall remain available until
expended.".
(c) DEMONSTRATION PERIOD.—Section 803 of the Cranston-Gon-

zalez National Affordable Housing Act (42 U.S.C. 8012) is
amended—
(1) in subsection (a), by striking "beginning on the date
of the enactment of this Act" and inserting "determined by
the Secretary"; and
(2) by striking paragraph (1) of subsection (g) and inserting
the following new paragraph:
"(1) The term 'demonstration period' means the 5-year
period referred to in subsection (a).".
SEC. 606. HOUSING O P P O R T U N I T I E S FOR PERSONS WITH ATOS.
(a) AMENDMENT OF CRANSTON-GONZALEZ NATIONAL HOUSING

ACT.—^Whenever in this section an amendment is expressed in
terms of an amendment to a section or other provision, the reference
shall be considered to be made to a section or other provision
of the Cranston-Gronzalez National Affordable Housing Act.
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 863 (42 U.S.C.
12912) is amended to read as follows:
"SEC 863. AUTHORIZATION OF APPROPRIATIONS.

"There are authorized to be appropriated to carry out this
subtitle $150,000,000 for fiscal year 1993 and $156,300,000 for
fiscal year 1994.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3807

(c) DEFINITIONS.—Section 853 (42 U.S.C. 12902) is amended—
(1) in paragraph (2), by striking "sponsor receiving assistance from a grantee" and inserting "organization eligible to
receive assistance imder this subtitle";
(2) in paragraph (5), by striking "metropolitan area" and
inserting "metropolitan statistical area"; and
(3) by adding at the end the following new paragraphs:
"(11) The term 'city* has the meaning given the term in
section 102(a) of the Housing and Community Development
Act of 1974.
"(12) The term 'eligible person' means a person with
acquired immunodeficiency syndrome or a related disease and
the family of such person.
"(13) The term 'nonprofit organization' means any nonprofit
organization (including a State or locally chartered, nonprofit
organization) that—
"(A) is organized under State or local laws;
"(B) has no part of its net earnings inuring to the
benefit of any member, founder, contributor, or individual;
"(C) complies with standards of financial accountability
acceptable to the Secretary; and
"(D) has among its purposes significant activities
related to providing services or housing to persons with
acquired immunodeficiency syndrome or related diseases.
"(14) The term 'project sponsor* means a nonprofit organization or a housing agency of a State or unit of general local
government that contracts with a grantee to receive assistance
under this subtitle.".
(d) GRANT ELIGIBILITY AND ALLOCATION.—Section 854 (42

U.S.C. 12903) is amended—
(1) in subsection (a), by striking "and imits of general
local government" and inserting ", units of general local government, and nonprofit organizations";
(2) by striking subsection (b) and inserting the following
new subsection:
"(b) IMPLEMENTATION OF ELIGIBLE ACTIVITIES.—A grantee shall

carry out eligible activities under section 855 through project sponsors. Any grantee that is a State that enters into a contract with
a nonprofit organization to carry out eligible activities in a locality
shall obtain the approval of the unit of general local government
for the locality before entering into the contract.";
(3) by striking paragraph (1) of subsection (c) and inserting
the following new paragraph:
"(1) FORMULA ALLOCATION.—The Secretary shall allocate
90 percent of the amoimts approved in appropriation Acts luider
section 863 among States and cities whose most recent comprehensive housing affordability strategy (or abbreviated strategy) has been approved by the Secretary under section 105
of this Act. Such amounts shall be allocated as follows:
"(A) 75 percent among—
"(i) cities that are the most populous unit of general local government in a metropolitan statistical area
having a population greater than 500,000 and more
than 1,500 cases of acquired immunodeficiency syndrome; and

106 STAT. 3808

PUBLIC LAW 102-550—OCT. 28, 1992
"(ii) States with more than 1,500 cases of acquired
immunodeficiency syndrome outside of metropolitan
statistical areas described in clause (i); and
"(B) 25 percent among cities that (i) are the most
populous unit of general local government in a metropolitan
statistical area having a population greater than 500,000
and more than 1,500 cases of acquired immunodeficiency
syndrome, and (ii) have a higher than average per capita
incidence of acquired immunodeficiency syndrome.
A single city may receive assistance allocated under subparagraph (A) and subparagraph (B), For purposes of allocating
amounts under this paragraph for any fiscal year, the number
of cases of acquired immunodeficiency syndrome shall be the
number of such cases reported to and confirmed by the Director
of the Centers for Disease Control of the Public Health Service
as of March 31 of the fiscal year immediately preceding the
fiscal year for which the amounts are appropriated and to
be allocated,";
(4) in subsection (c)(3)—
(A) by striking the paragraph heading and inserting
"NONFORMULA ALLOCATION.—"; and

(B) by striking subparagraph (A) and inserting the
following new subparagraph:
"(A) IN GENERAL.—The Secretary shall allocate 10 percent of the amounts appropriated under section 863
among—
"(i) States and units of general local government
that do not qualify for allocation of amounts under
paragraph (1); and
"(ii) States, units of general local government, and
nonprofit organizations, to fund special projects of
national significance.";
(5) in the first sentence of subsection (d), by striking
"approvable applications submitted by eligible applicants" and
inserting "applications submitted by applicants and approved
by the Secretary";
(6) in subsection (e), by striking "requirements of subsection
(b)" and inserting "other requirements of this section"; and
(7) by adding at the end the following new subsection:
"(f) ADDITIONAL REQUIREMENT FOR CITY FORMULA GRANTEES.—

In addition to the other requirements of this section, to be eligible
for a grant pursuant to subsection (c)(1), a city shall provide such
assurances as the Secretary may require that any grant amounts
received will be allocated among eligible activities in a manner
that addresses the needs within the metropolitan statistical area
in which the city is located, including areas not within the jurisdiction of the city. Any such city shall coordinate with other units
of general local government located within the metropolitan statistical area to provide such assurances and comply with the
assurances.".
(e) LIMITATION ON SPENDING FOR OTHER ACTIVITIES.—Section

855(6) (42 U.S.C. 12904(6)) is amended by inserting before the
period at the end the following: ", except that activities developed
under this paragraph may be assisted only with amounts provided
under section 854(c)(3)".

PUBLIC LAW 102-550—OCT. 28, 1992
(0

106 STAT. 3809

FEES AND LIMITATION ON U S E OF GRANT AMOUNTS FOR

ADMINISTRATIVE EXPENSES.—Section 856 (42 U.S.C. 12905) is

amended—
(1) by striking subsection (d) and inserting the following
new subsection:
"(d) PROHIBITION OF FEES.—The recipient shall agree that no
fee will be charged to any eligible person for any housing or services
provided with amounts from a grant under this subtitle."; and
(2) by adding at the end the following new subsection:
"(g) ADMINISTRATIVE EXPENSES.—

"(1) GRANTEES.—^Notwithstanding any other provision of
this subtitle, each grantee may use not more than 3 percent
of the grant amount for administrative costs relating to administering grant amounts and allocating such amounts to project
sponsors.
"(2) PROJECT SPONSORS.—^Notwithstanding any other provision of this subtitle, each project sponsor receiving amounts
from grants made under this title may use not more than
7 percent of the amounts received for administrative costs
relating to carrying out eligible activities under section 855,
including the costs of staff necessary to carry out eligible
activities.".
(g) SHORT-TERM SUPPORTED HOUSING AND SERVICES.—Section

858 (42 U.S.C. 12907) is amended—
(1) in subsection (a)—
(A) in paragraph (3), by inserting before the period
at the end the following: "(except that health services under
this paragraph may only be provided to individuals with
acquired immunodeficiency syndrome or related diseases),
and providing technical assistance to eligible persons to
provide assistance in gaining access to benefits and services
for homeless individuals provided by the Federal Government and State and local governments";
(B) by striking paragraphs (4) and (5); and
(C) by adding at the end the following new paragraphs:
"(4) OPERATION.—Providing for the operation of short-term
supported housing provided imder this section, including the
costs of security, operation insurance, utilities, furnishings,
equipment, supplies, and other incidental costs.
"(5) ADMINISTRATION.—Providing staff to carry out the program under this section (subject to the provisions of section
856(g))."; and
(2) in subsection (b)—
(A) in paragraph (2)—
(i) by striking subparagraph (B);
(ii) in subparagraph (C), by striking "limitations
under subparagraphs (A) and (B)" and inserting
"limitation under subparagraph (A)"; and
(iii) by redesignating subparagraph (C) (as so
amended) as subparagraph (B); and
(B) in paragraph (3), by adding at the end the following
new subparagraph:
"(C) WAIVER.—Notwithstanding subparagraphs (A) and
(B), the Secretary may waive the applicability of the
requirements imder such subparagraphs with respect to
any individual for which the project sponsor has made

106 STAT. 3810

PUBLIC LAW 102-550—OCT. 28, 1992
a good faith effort to acquire permanent housing (in accordance with paragraph (4)) and has been unable to do so.",
(h) RENTAL ASSISTANCE.—

(1) I N GENERAL.—Section 859 (42 U.S.C. 12908) is
amended—
(A) by striking the section heading and inserting the
following new section heading:
"SEC. 869. RENTAL ASSISTANCE.";

(B) in the first sentence of subsection (aXD, by striking
"short-term"; and
(C) by adding at the end the following new subsection:
"(c) ADMINISTRATIVE COSTS.—^A project sponsor providing rental
assistance under this section may use amounts from any grant
received under this section for administrative expenses involved
in providing such assistance, subject to the provisions of 856(g)(2).".
(2) CONFORMING AMENDMENT.—Section 855(3) (42 U.S.C.

12904(3)) is amended by striking "short-term".
(i) COMMUNITY RESIDENCES AND SERVICES.—Section 861(c) (42
U.S.C. 12910(c)) is amended—
(1) in paragraph (IXC), by inserting before the period at
the end the following: ", and expenses relating to community
outreach and educational activities regarding acquired
immunodeficiency s3rndrome and related diseases provided for
individuals residing in proximity of eligible persons assisted
under this subtitle"; and
(2) by striking paragraph (3) and inserting the following
new paragraph:
"(3)

ADMINISTRATIVE

EXPENSES,—For

administrative

expenses related to the planning and carrying out activities
under this section (subject to the provisions of section 856(g)).".
(j) ELIGIBILITY OF FAMILIES.—

(1) Section 852 (42 U.S.C. 12901) is amended by inserting
"and families of such persons" before the period at the end.
(2) Section 854(cX3) (42 U.S.C. 12903(cX3)) is amended
by striking "persons with acquired immunodeficiency syndrome"
and inserting "eligible persons" each place it appears.
(3) Section 855 (42 U.S.C. 12904) is amended—
(A) in the matter preceding paragraph (1), by striking
"such persons with acquired immunodeficiency syndrome"
and inserting "eligible persons"; and
(B) in paragraph (5), by striking "with acquired
immunodeficiency syndrome".
(4) Section 856(c) (42 U.S.C. 12905(c)) is amended by striking "such individuals" and inserting "such eligible persons".
(5) Section 858(aX3) (42 U.S.C. 12907(aX3)) is amended
by striking "individuals" and inserting "eligible persons".
(6) Section 859(bXl) (42 U.S.C. 12908(bXl)) is amended
by striking "individuals" and inserting "eligible persons".
(7) Sections 859(bX2) and 860(bX2) (42 U.S.C. 12908(b),
12909(bX2)) are amended by inserting "with acquired
immunodeficiency syndrome or related diseases" after "any
individual" each place it appears.
(8) Section 861(a) (42 U.S.C. 12910(a)) is amended by striking "persons with acquired immunodeficiency syndrome or
related diseases" and inserting "eligible persons .

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3811

(9) Section 861(bXlXAXiv) (42 U.S.C. 12910(bXlXAXiv))
is amended by striking "such individiials" and inserting "such
eligible persons".
(10) Section 861(dXl) (42 U.S.C. 12910(dXl)) is amended—
(A) in subparagraph (A), by striking "individuals" and
inserting "eligible persons"; and
(B) in subparagraph (D), by inserting "with acquired
immunodeficiency syndrome or related diseases" after "any
individual".
(11) Subtitle D of title VIII of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12901 et seq.)
is amended by striking "individuals with acquired
immunodeficiency sjmdrome or related diseases" each place
it appears in the following provisions and inserting "eligible
persons":
(A) Section 856(c).
(B) Section 857.
(C) Section 858—
(i) in subsection (a), in the matter preceding paragraph (1); and
(ii) in subsection (bXl)(A);
(D) Section 859(aXl).
(E) Section 861—
(i) in subsection (b); and
(ii) in subsection (d).
(k) REGULATIONS.—
(1) INTERIM REGULATIONS.—Not later than the expiration

of the 30-day period beginning on the date of the enactment
of this Act, the Secretary of Housing and Urban Development
shall submit to the Congress a copy of proposed interim regulations implementing subtitle D of title ^ 1 1 of the Cranston(jionzalez National Affordable Housing Act (as amended by
this section). Not later than the expiration of the 45-day period
beginning on the date of the enactment of this Act, but not
before the expiration of the 15-day period beginning upon the
submission of the proposed interim regulations to the Congress,
the Secretary shall publish interim regulations implementing
such subtitle (as amended), which shall take effect upon
publication.
(2) FINAL REGULATIONS.—Not later than the expiration of
the 90-day period beginning upon the publication of interim
regulations under paragraph (1), the Secretary shall issue final
regulations implementing subtitle D of title VIII of the Cranston-Gonzalez National Affordable Housing Act (as amended
by this section) after notice and opportunity for public comment
regarding the interim regulations, pursuant to the provisions
of section 553 of title 5, United States Code (notvdthstanding
subsections (aX2), (bXB), and (dX3) of such section). The duration of the period for public comment under such section 553
shall be not less than 60 days, and the final regulations shall
take effect upon issuance.

42 u s e 12905.
42 u s e 12906.
42 u s e 12907.

42 u s e 12908.
42 u s e 12910.

42 u s e 12901
note.

106 STAT. 3812

PUBLIC LAW 102-550—OCT. 28, 1992

Subtitle B—Authority for Public Housing
Agencies To Provide Designated Public
Housing and Assistance for Disabled
Families
SEC. 621. DEFINITIONS.

Paragraph 3 of section 3(b) of the United States Housing Act
of 1937 (42 U.S.C. 1437a(bX3)) is amended to read as follows:
"(3) PERSONS AND FAMILIES.—
"(A) SINGLE PERSONS.—The term 'families' includes families

consisting of a single person in the case of (i) an elderly person,
(ii) a disabled person, (iii) a displaced person, (iv) the remaining
member of a tenant family, and (v) any other single persons.
In no event may any single person imder clause (v) of the
first sentence be provided a housing unit assisted under this
Act of 2 or more bedrooms. In determining priority for admission to housing under this Act, the Secretary shall give preference to single persons who are elderly, disabled, or displaced
persons before single persons who are eligible under clause
(v) of the first sentence.
"(B) FAMILIES.—^The term 'families' means families with
children, in the cases of elderly families, near-elderly families,
and disabled families, means families whose heads (or their
spouses), or whose sole members, are elderly, near-elderly, or
persons with disabilities, respectively. The term includes, in
the cases of elderly families, near-elderly families, and disabled
families, 2 or more elderly persons, near-elderly persons, or
persons with disabilities living together, and 1 or more such
persons living with 1 or more persons determined under the
regulations of the Secretary to be essential to their care or
well-being.
"(C) ABSENCE O F CHILDREN.—The temporary absence of

a child from the home due to placement in foster care shall
not be considered in determining family composition and family
size.
"(D) ELDERLY PERSON.—The term 'elderly person* means
a person who is at least 62 years of age.
"(E) PERSON WITH DISABILITIES.—^The term 'person with
disabilities' means a person who—
"(i) has a disability as defined in section 223 of the
Social Security Act,
"(ii) is determined, pursuant to regulations issued by
the Secretary, to have a physical, mental, or emotional
impairment which (I) is expected to be of long-continued
and indefinite duration, (II) substantially impedes his or
her ability to live independently, and (III) is of such a
nature that such ability could be improved by more suitable
housing conditions, or
"(iii) has a developmental disability as defined in section 102 of the Developmental Disabilities Assistance and
Bill of Rights Act.
Such term shall not exclude persons who have the disease
of acquired immunodeficiency syndrome or any conditions aris-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3813

ing from the etiologic agent for acquired immunodeficiency
sjnidrome.
"(F) DISPLACED PERSON.—The term 'displaced person'
means a person displaced by governmental action, or a person
whose dwelling has been extensively damaged or destroyed
as a result of a disaster declared or otherwise formally recognized pursuant to Federal disaster relief laws.
"(G) NEAR-ELDERLY PERSON.—The term *near-elderly person' means a person who is at least 50 years of age but below
the age of 62.".
SEC. 622. AUTHORITY.

(a) I N GENERAL.—Section 7 of the United States Housing Act
of 1937 (42 U.S.C. 1437e) is amended to read as follows:
"DESIGNATED HOUSING
"SEC. 7. (a) AUTHORITY T O PROVIDE DESIGNATED HOUSING.—

"(1) I N GENERAL.—Notwithstanding any other provision of
law, a public housing agency whose allocation plan under subsection (f) (and any biannual update) has been approved by
the Secretary may, to the extent provided in the allocation
plan, provide public housing projects (or portions of projects)
designated for occupancy by (A) only elderly families, (B) only
disabled families (subject to the provisions of subsection (e)),
or (C) elderly and disabled families.
"(2) PRIORITY FOR OCCUPANCY.—In determining priority for
admission to public housing projects (or portions of projects)
that are designated for occupancy as provided in paragraph
(1), the public housing agency may make units in such projects
(or portions) available only to the types of families for whom
the project is designated. Among such types of families, preference for occupancy in such projects (or portions) shall be
given according to the preferences for occupancy under section
6(c)(4)(A).
"(3) ELIGIBILITY OF NEAR-ELDERLY FAMILIES.—If a public

housing agency determines (in accordance with regulations
established by the Secretary) that there are insufficient numbers of elderly families to fill all the units in a project (or
portion of a project) designated under paragraph (1) for occupancy by only elderly families, the agency may (pursuant to
the approved allocation plan under subsection (f) for the agency)
provide that near-elderly families who qualify for preferences
for occupancy under section 6(c)(4)(A) may occupy dwelling
units in the project (or portion).
"(4) VACANCY.—Notwithstanding the authority under paragraphs (1) and (2) to designate public housing projects (or
portions of projects) for occupancy by only certain types of
families, a public housing agency shall make any dwelling
unit that is ready for occupancy in such a project (or portion
of a project) that has been vacant for more than 60 consecutive
days generally available for occupancy (subject to the requirements of this title) without regard to such designation.
"(b) AVAILABILITY OF HOUSING.—

"(1) TENANT CHOICE.—^The decision of any disabled family
not to occupy or accept occupancy in an appropriate type of
project or assistance made available to the family under this
title shall not adversely affect the family with respect to a

106 STAT. 3814

PUBLIC LAW 102-550—OCT. 28, 1992

public housing agency making available occupancy in other
appropriate projects in public housing or assistance under this
title.
"(2) DISCRIMINATORY SELECTION.—Paragraph (1) shall not
apply to any family who decides not to occupy or accept an
appropriate dwelling unit in public housing or to accept assistance iinder this Act on the basis of the race, color, religion,
sex, disability, familial status, or national origin of occupants
of housing or the surrounding area.
"(3) APPROPRIATENESS OF DWELLING UNITS.—This section
may not be construed to require a public housing agency to
offer occupancy in any dwelling unit assisted under this Act
to any family who is not of appropriate family size for the
dwelling unit.
"(c) PROHIBITION OF EviCTiONS.^Any tenant who is lawfully
residing in a dwelling unit in the project may not be evicted or
otherwise required to vacate such imit because of the designation
of the project (or portion of a project) or because of any action
taken by the Secretary of Housing and Urban Development or
any public housing agency pursuant to this section.
^'(d) ACCOMMODATION OF HOUSING AND SERVICE NEEDS.—In

designing, developing, otherwise acquiring and operating, designating, and providing housing and assistance under this title, each
public housing agency shall meet, to the extent practicable, the
housing and service needs of eligible families applying for assistance
under this title, as provided in any allocation plan of the agency
approved under subsection (f). To meet such needs, public housing
agencies may, wherever practicable and in accordance with any
allocation plan of the agency—
"(1) provide housing in which supportive services are provided, facilitated, or coordinated, mixed housing, shared housing, family housing, group homes, congregate housing, and
other housing as the public housing agency considers
appropriate;
"(2) carry out major reconstruction of obsolete public housing projects and reconfiguration of public housing dwelling
units; and
"(3) provide tenant-based assistance under section
811(b)(1).
"(e) APPLICATION FOR DESIGNATED HOUSING FOR DISABLED
FAMILIES.—

"(1) REQUIREMENT.—^A project (or portion of a project) may
be designated under subsection (a)(1) for occupancy by only
disabled families only if the public housing agency administering the project complies with the other requirements of this
section and the Secretary approves an application under this
subsection for such designation. The Secretary shall establish
the form and procedures for submission and approval of applications under this subsection.
"(2) CONTENTS.—^An application under this subsection shall
contain—
"(i) a description of the projects (or portions of
projects) to be designated (which may include group
homes, independent living facilities, units in multifamily housing developments, condominium housing,
cooperative housing, and scattered site housing);
"(ii) a supportive service plan—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3815

"(I) describing the needs of persons with
disabilities that the housing is expected to serve;
"(11) providing for delivery of supportive services appropriate to meet the individual needs of
persons with disabilities occupying the housing;
"(III) describing the experience of the applicant
(or service providers) in providing such services;
"(IV) describing the manner in which such
services will be provided to such persons; and
"(V) identifying any State, local, other Federal,
or other funds available for providing such
services; and
"(iii) any other information or certification that
the Secretary considers appropriate.
"(3) APPROVAL.—^The Secretary may approve an application
under this subsection only if the Secretary determines that—
"(i) the persons with disabilities occupying t h e .
housing will receive supportive services based on their
individual needs;
"(ii) the applicant (or service providers) have sufficient experience in providing supportive services;
"(iii) residential supervision will be provided in
the housing sufficient to facilitate the provision of
supportive services; and
"(iv) the supportive services are adequately
designed to meet the special needs of the tenants.
"(4) SUPPORTIVE SERVICES.—For purposes of this subsection, the term 'supportive services' means services designed
to meet the special needs of tenants, and may include meal
services, healtn-related services, mental health services, services for nonmedical counseling, meals, transportation, personal
care, bathing, toileting, housekeeping, chore assistance, safety,
group and socialization activities, assistance with medications
(in accordance with any applicable State laws), case management, personal emergency response, and other appropriate
services.
"(f) ALLOCATION PLANS.—

"(1) REQUIREMENT.—^A public housing agency may not designate a project (or portion of a project) for occupancy under
subsection (a)(1) unless the agency submits an allocation plan
under this subsection and the plan is approved under paragraph
(4) of this subsection.
"(2) CONTENTS.—^An allocation plan submitted under this
subsection by a public housing agency shall include—
"(A) a description of the projects (or portions of projects)
to be designated and the types of tenants occupying such
projects (or portions);
"(B) a aescription of the estimated pool of applicants
for such housing, based on the waiting lists for such housing, and any information collected in the comprehensive
housing affordability strategy under section 105 of the
Cranston-Gonzalez National Affordable Housing Act for the
jurisdiction within which the area served by the public
housing agency is located;
"((j) a statement identifying the projects or portions
of projects (including the buildings or floors) to be designated for occupancy under subsection (a)(1) for only cer-

^

106 STAT. 3816

PUBLIC LAW 102-550—OCT. 28, 1992
tain types of families, the types of families who will be
eligible for occupancy in such projects (or portions), and
the reasons for the designation;
"(D) documentation of the number of units in the
projects (or portions) identified under subparagraph (C)
which became vacant and available for occupancy during
the preceding year;
"(E) an estimate of the number of units in the projects
(or portions) identified under subparagraph (C) that will
become vacant and available for occupancy during the ensuing 2-year period;
"(F) a description of the occupancy policies and procedures, including procedures for maintaining waiting lists
for eligible applicants who are elderly families or disabled
families for occupancy in units in projects administered
by the agency sufficient to document the number and duration of instances in which housing assistance for eligible
applicants will be denied or delayed by the agency because
of a lack of appropriately designated units;
"(G) a plan for securing sufficient additional resources
that the agency owns, controls, or has received preliminary
notification that it will obtain, or for which the agency
plans to apply, that will be sufficient to provide assistance
to not less than the number of nonelderly disabled families
that would have been housed if occupancy in such units
were not restricted pursuant to this section; and
"(H) any comments of agencies, organizations, or persons with whom the public housing agency consults under
paragraph (3).
"(3) DEVELOPMENT.—In preparing the initial allocation
plan, or updates of a plan under paragraph (5), for submission
under this subsection, a public housing agency shall consult
with the State or unit of general local government in whose
jurisdiction the area served by the public housing agency is
located, public and private service providers, advocates for the
interest of eligible elderly families, disabled families, and families with children, and other interested parties.
"(4) APPROVAL.—

"(A) CRITERIA.—^The Secretary shall approve an allocation plan, or an updated plan, submitted under this subsection if the Secretary determines that, based on the plan
and comments submitted pursuant to paragraph (2)(H)—
"(i) the information contained in the plan is complete and accurate and the projections are reasonable;
"(ii) implementation of the plan will not result
in excessive vacancy rates in projects (or portions of
projects) identified in paragraph (2)(C); and
"(iii) the plan under paragraph (2)(G) can reasonably be achieved.
"(B) NOTIFICATION.—

"(i) IN GENERAL.—^The Secretary shall notify each
public housing agency submitting an allocation plan
under this subsection in writing of approval or disapproval of the plan.
"(ii) TIMING.—^A plan shall be considered to be
approved if the Secretary does not notify the public
housing agency of approval or disapproval of the initial

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3817

or revised plan within (I) 90 days after the submission
of any plan that contains comments pursuant to paragraph (2)(H), or (II) 45 days for any otner plan.
"(iii) RESUBMISSION.—If the Secretary disapproves
the plan, the Secretary shall, for a period of not less
than 45 days following the date of disapproval, permit
amendments to, or resubmission of, the plan.
"(C) RULE O F CONSTRUCTION.—The approval of an

allocation plan or updated plan under this subsection may
not be construed to constitute approval of any request
for assistance for major reconstruction of obsolete projects,
assistance for development or acquisition of public housing,
or assistance under section 811(bXl) of the Cranston-Gonzalez National Affordable Housing Act, that are contained
in the plan pursuant to subparagraph (H).
"(5) BIANNUAL UPDATE.—

"(A) I N GENERAL.—Each public housing agency that
owns or operates a project (or portion of a project) that
is designated for occupancy under subsection (a)(1) shall
update the plan of the agency under this subsection not
less than once every 2 years, as the Secretary shall provide.
The Secretary shall notify each public housing agency
submitting an updated plan under this paragraph of
approval or disapproval of the updated plan as required
under paragraph (4XB), and the provisions of such paragraph shall apply to updated plans under this paragraph.
"(B) CONTENTS.—The updated plan shall include—
"(i) a review of the data and projections contained
in the allocation plan and the most recent update
submitted under this subsection;
"(ii) an assessment of the accuracy of the projections contained in such plan and update;
"(iii) a statement of the number of times a vacancy
was filled pursuant to subsection (aX4);
"(iv) a statement of the number of times an application for housing assistance by an eligible applicant
was denied or delayed because of a lack of appropriately designated units; and
"(v) a plan for adjusting the allocation, if necessary,
in accordance with the needs identified pursuant to
this subparagraph.
"(C) STANDARDS FOR APPROVAL.—The Secretary shall
establish standards for preparation, submission, and
approval of updated plans.
"(g) PROHIBITION OF COERCION.—^No elderly or disabled family

residing in any public housing project may be required to accept
services.".
(b) OCCUPANCY PREFERENCES.—The matter preceding clause
(i) in section 6(c)(4XA) of the United States Housing Act of 1937
(42 U.S.C. 1437d(cX4)(A)) is amended by striking "specifically designated for elderly families" and inserting "designated for occupancy
pursuant to section 7(a)".
(c) DEFINITIONS.—Section 3(c) of the United Stetes Housing
Act of 1937 (42 U.S.C. 1437a(c)) is amended by inserting after
"project." the following new paragraphs:
"(4) The term 'congregate housing* means low-rent housing
with which there is connected a central dining facility where whole-

106 STAT. 3818

PUBLIC LAW 102-550—OCT. 28, 1992

some and economical meals can be served to occupants. Expenditures incurred by a public housing agency in the operation of
a central dining facility in connection with congregate housing
(other than the cost of providing food and service) shall be considered a cost of operation of the project.
"(5) The terms 'group home' and 'independent living facility*
have the meanings given such terms in section 811(k) of the Cranston-Gronzalez National Affordable Housing Act.
SEC. 623. TENANT-BASED
DISABILITIES.

ASSISTANCE

FOR

PERSONS

WITH

(a) IN GENERAL.—Section 811 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 8013) is amended—
(1) by amending the section heading to read as follows:
'^SEC. 811. SUPPORTIVE HOUSING FOR PERSONS WITH DISABILmES.";

•.

(2) in subsection (b)—
(A) in the matter following paragraph (2)—
(i) by moving such matter 2 ems to the right;
and
(ii) by striking "Such assistance" and inserting
"assistance under this paragraph";
(B) by striking the subsection heading and all that
follows through the end of paragraph (2) and inserting
the following:
"(b) AUTHORITY To PROVIDE ASSISTANCE.—The Secretary is
authorized—
"(1) to provide tenant-based rental assistance to eligible
persons vdth disabilities, in accordance with subsection (dX4);
and
"(2) to provide assistance to private, nonprofit organizations
to expand the supply of supportive housing for persons with
disabilities, which shall be provided as—
"(A) capital advances in accordance with subsection
(dXD.and
"(B) contracts for project rental assistance in accordance with subsection (dX2);'';
(3) in subsection (d)—
(A) in paragraphs (1) and (3), by striking "this section"
and inserting "subsection (bX2)"; and
(B) by adding at the end the following new paragraph—
"(4)

TENANT-BASED

RENTAL ASSISTANCE.—Tenant-based

rental assistance provided under subsection (bXD may be provided only through a public housing agency that has submitted,
and had approved, an allocation plan under section 7(f) of
the United States Housing Act of 1937, and a public housing
agency shall be eli^ble to apply under this section only for
the purposes of providing such assistance. Such assistance shall
be made available to eligible persons with disabilities and
administered under the same rules that govern rental assistance made available under section 8 of the United Stetes Housing Act of 1937. In determining the amount of assistance
provided under subsection (bXD ibr a public housing agency,
the Secretary shall consider the needs of the agency as
described in the allocation plan.";
(4) in subsection (eXD, by striking "this section" and inserting "subsection (bX2)";

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3819

(5) in subsection (f), in the first and second sentences,
by striking "this section" and inserting "subsection (b)(2)"; and
(6) in subsection (g), by striking "this section" and inserting
"subsection (b)(2)".
(b) SECTION 8 ASSISTANCE.—Section 8 of the United States
Housing Act of 1937 (42 U.S.C. 14370, is amended by inserting
after subsection (h) the following new subsection:
"(i) The Secretary may not consider the receipt by a public
housing agency of assistance under section 811(bXl) of the Cranston-(jronzalez National Affordable Housing Act, or the amount
received, in approving assistance for the agency under this section
or determining the amount of such assistance to be provided.".
SEC. 624. DEVELOPMENT AND RECONSTRUCTION OF HOUSING FOR
DISABLED FAMIUES.
(a) SET-ASIDE O F MAJOR RECONSTRUCTION FUNDS FOR
RECONFIGURATION O F PROJECTS.—Section 5(jX2) of the United

States Housing Act of 1937 (42 U.S.C. 1437c(jX2)), as amended
by the preceding provisions of this Act, is further amended by
adding at the end the following new subparagraph:
"(G)(i) In fiscal years 1993 and 1994, the Secretanr shall commit
for use under clause (ii) not less than 5 percent of any amounts
reserved under subparagraph (A) for each such fiscal year.
"(ii) The amounts referred to in clause (i) shall be available
to public housing agencies only for use for projects (or portions
of projects) designated for occupancy under section 7(aXl) and (e)
by disabled families.
"(iii) In allocating amounts reserved under this subparagraph
among public housing agencies, the Secretary shall consider the
need for any such amounts as identified in the allocation plans
submitted by agencies under section 7(f).".
(b) SET-ASIDE O F N E W CONSTRUCTION FUNDS FOR HOUSING
DESIGNED FOR DISABLED FAMILIES AND SINGLE PERSONS.—Section

5(j) of the United States Housing Act of 1937 (42 U.S.C. 1437c(j))
is amended by adding at the end the following new paragraph:
"(3)(A) In fiscal years 1993 and 1994, the Secretary shall reserve
for use under subparagraph (B) not less than 5 percent of any
amounts approved in appropriation Acts for each such fiscal year
for public housing grants under subsection (aX2) that are not designated under such Acts for use under paragraph (2) of this
subsection for the substantial redesign, reconstruction, or redevelopment of existing public housing projects, buildings, or units.
"(B) Any amount reserved under subparagraph (A) shall be
available only to public housing agencies that have designated
projects (or portions of projects) for occupancy under section 7(aXl)
tor use only for the costs of development or acquisition of public
housing projects or buildings designated for occupancy under section
7(aXl) and (e) by disabled families. A building so assisted may
not contain more than 25 dwelling units, except that the Secretary
may (in the discretion of the Secretary) waive such limitation for
a building.
"(C) The Secretary shall carry out a competition for budget
authority reserved under subparagraph (A) among eligible public
housing agencies and shall allocate such budget authority to public
housing agencies pursuant to the competition, based on (i) the
need of the agency for such assistance (taking into consideration
the allocation plans submitted under section 7(f) by agencies), and

106 STAT. 3820

PUBLIC LAW 102-550—OCT. 28, 1992

(ii) the extent to which the public housing projects and buildings
to be developed or assisted meet the requirements of section 7(e).".
(c) REQUIREMENT FOR U S E OF N E W CONSTRUCTION FUNDS FOR
PROJECTS DESIGNATED FOR ELDERLY FAMILIES.—Section 5(jXl) of

the United States Housing Act of 1937 (42 U.S.C. 1437c(jXl)) is
amended—
(1) in subparagraph (D), by striking "and" at the end;
(2) by redesignating subparagraph (E) as subparagraph
(F); and
(3) by adding at the end the following new subparagraph:
"(E) in the case of an application for development of projects
(or portions of projects) designated under section 7(aXl) for
occupancy for elderly families, only if the agency certifies to
the Secretary that the use of such assistance will assist in
expanding the housing available for eligible persons with
disabilities identified in the allocation plan for the agency
submitted under section 7(f); and".
SEC. 625. CONFORMING AMENDMENTS.

42 u s e 1437a.
42 u s e 1437d.
42 u s e 1437/.

42 u s e 1437o.

42 u s e 1437a
note.

(a) UNITED STATES HOUSING ACT OF 1937.—^The United States
Housing Act of 1937 (42 U.S.C. 1437 et seq.) is amended—
(1) in section 3(bX5XB), by inserting "or disabled" after
"elderly";
(2) in the last sentence of section 6(a), by striking "the
elderly" and inserting "elderly or disabled families";
(3) in section 14(iXlXDXii), by striking "elderly families
and handicapped families" and inserting "elderly and disabled
families"; and
(4) in section 17(cX2XGXi), by striking "the elderly" and
inserting "elderly families".
(b) HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1974.—
The first sentence of section 209 of the Housing and Community
Development Act of 1974 (42 U.S.C. 1438) is amended by striking
"the elderly or the handicapped" and inserting "elderly or disabled
families".
SEC. 626. I N A P P U C A B I U T Y TO INDIAN PUBUC HOUSING.

The amendments made by this subtitle shall not apply with
respect to lower income housing developed or operated pursuant
to a contract between the Secretary of Housing and Urban Development and an Indian housing authority.

Subtitle C—Standards and Obligations of
Residency in Federally Assisted Housing
42 USE 13601.

S E C 641. COMPLIANCE BY OWNERS AS CONDITION OF FEDERAL
ASSISTANCE.

The Secretary of Housing and Urban Development shall require
owners of federally assisted housing (as such term is defined in
section 683(2)), as a condition of receiving housing assistance for
such housing, to comply with the procedures and requirements
established under this subtitle.

PUBLIC LAW 102-550—OCT. 28, 1992
SEC. 642. COMPLIANCE WITH CRITERIA
REQUIREMENT FOR TENANCY.

FOR

106 STAT. 3821

OCCUPANCY AS

42 USC13602.

In selecting tenants for occupancy of units in federally assisted
housing, an owner of such housing shall utilize the criteria for
occupancy in federally assisted housing established by the Secretary, by regulation, under section 643. If an owner determines
that an appucant for occupancy in the housing does not meet
such criteria, the owner may deny such applicant occupancy.
SEC. 643. ESTABUSHMENT OF CRITERIA FOR OCCUPANCY.
(a) TASK FORCE.—

(1) ESTABLISHMENT.—To assist the Secretary in establishing reasonable criteria for occupancy in federally assisted housing, the Secretary shall establish a task force to review all
rmes, policy statements, handbooks, technical assistance memoranda, and other relevant documents issued by the Department
of Housing and Urban Development on the standards and
obligations governing residency in federally assisted housing
and make recommendations to the Secretary for the establishment of such criteria for occupeincy.
(2) MEMBERS.—The Secretary shall appoint members to
the task force, which shall include individuals representing
the interests of owners, managers, and tenants of federally
assisted housing, public housing agencies, owner and tenant
advocacy organizations, persons with disabilities and disabled
families, organizations assisting homeless individuals, and
social service, mental health, and other nonprofit servicer
providers who serve federally assisted housing.
(3) COMPENSATION.—Members of the task force shall not
receive compensation for serving on the task force.
(4) DUTIES.—The task force shall—
(A) review all existing standards, regulations, and
guidelines governing occupancy and tenant selection policies in federally assisted housing;
(B) review all existing standards, regulations, and
guidelines governing lease provisions and other rules of
occupancy for federally assisted housing;
(C) determine whether the standards, regulations, and
guidelines reviewed under subparagraphs (A) and (B) provide sufficient guidance to owners and managers of federally assisted housing to—
(i) develop procedures for preselection inquiries
sufficient to determine the capacity of applicants to
comply with reasonable lease terms and conditions of
occupancy;
(ii) utilize leases that prohibit behavior which
endangers the health or saiety of other tenants or
violates the rights of other tenants to peaceful enjoyment of the premises;
(iii) assess the need to provide, and appropriate
measures for providing, reasonable accommodations
required under the Fair Housing Act and section 504
of the Rehabilitation Act of 1973 for persons with various types of disabilities; and
(iv) comply with civil rights laws and regulations;

42 USC 13603.

106 STAT. 3822

PUBLIC LAW 102-550—OCT. 28, 1992
(D) propose criteria for occupaiu^ in federally assisted
housing, standards for the reasonable performance and
behavior of tenants of federally assisted housing, compliance standards consistent with the reasonable accommodation of the requirements of the Fair Housing Act and
section 504 of the Rehabilitation Act of 1973, standards
for compliance with other civil rights laws, and procedures
for the eviction of tenants not complying with such standards consistent with sections 6 and 8 of the United States
Housing Act of 1937; and
(E) report to the Congress and the Secretary of Housing
and Urban Development pursuant to paragraph (7).
(5) PROCEDURE.—In carrying out its duties, the task force
shall hold public hearings and receive written comments for
a period of not less than 60 days.
(6) SUPPORT.—^The Secretary of Housing and Urban Development shsdl cooperate fiilly with the task force and shall
provide support stafT and office space to assist the task force
m carrying out its duties.
(7) REPORTS.—^Not later than 3 months after the date of
enactment of this Act, the task force shall submit to the Secretary and the Congress a preliminary report describing its
initial actions. Not later than 6 months after the date of enactment of this Act, the task force shall submit a report to the
Secretary and the Congress, which shall include—
(A) a description of its findings; and
(B) recommendations to revise such standards, regulations, and guidelines to provide accurate and complete guidance to owners and managers of federally assisted housing
as determined necessary tmder paragraph (4).
(b) RULEMAKING.—

Regulations.

Regulations.

(1) AUTHORITY.—^The Secretary shall, by regulation, establish criteria for selection of tenants for occupancy in federally
assisted housing and lease provisions for such housing.
(2) STANDARDS.—^The criteria shall provide sufficient guidance to owners and managers of federally assisted housing
to enable them to (A) select tenants capable of complying with
reasonable lease terms, (B) utilize leases prohibiting behavior
which endangers the health or safety of others or violates
the right of other tenants to peaceful enjoyment of the premises,
(C) comply with legal requirements to make reasonable accommodations for persons with disabilities, and (D) comply with
civil rights laws. The criteria shall be consistent vdth the
requirements under subsections (k) and (1) of section 6 and
section 8(dXl) of the United States Housing Act of 1937 and
any similar contract and lease requirements for federally
assisted housing. In establishing the criteria, the Secretary
shall take into consideration the report of the task force under
subsection (aX7).
(3) PROCEDURE.—^Not later than 90 days after the submission of the final report under subsection (aX7), the Secretary
shall issue a notice of proposed rulemaking of the regulations
under this subsection providing for notice and opportunity for
public comment regarding the regulations, pursuant to the
provisions of section 553 oftitle 5, United States Code (notwithstancUng subsections (aX2), (bXB), and (dX3) of such section).
The duration of the period for public comment under such

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3823

section 553 shall not be less than 60 days. The Secretary
shall issue final regulations under this subsection not later
than the expiration of the 60-day period beginning upon the
conclusion of the comment period, which shall take effect upon
issuance.
SEC. 644. ASSISTED APPLICATIONS.

Regulations.

42 u s e 13604.

(a) AUTHORITY.—^The Secretary shall provide that any individual or family applying for occupancy in federally assisted housing
may include in the application for the housing the name, address,
phone number, and other relevant information of a family member,
fiiend, or social, health, advocacy, or other organization, and that
the owner shall treat such information as confidential.
(b) MAINTENANCE OF INFORMATION.—The Secretary shall
require the owner of any federally assisted housing receiving an
application including such information to maintain such information
for any appliccmts who become tenants of the housing, for the
purposes of facilitating contact by the owner with such person
or organization to assist in providing any services or special care
for the tenant and assist in resolving any relevant tenancy issues
arising during the tenancy of such tenant.
(c) LIMITATIONS.—^An owner of federally assisted housing may
not require any individual or family appljdng for occupancy in
the housing to provide the information described in subsection
(a).

Subtitle D—Authority To Provide Preferences for Elderly Residents and Units
for Disabled Residents in Certain Section 8 Assisted Housing
SEC. 651. AUTHORITY.

42 u s e 13611.

Notwithstanding any other provision of law, an owner of a
covered section 8 housing project (as such term is defined in section
659) designed primarily for occupancy by elderly families may,
in selecting tenants for units in the project that become available
for occupancy, give preference to elderly families who have applied
for occupancy in the housing, subject to the requirements of this
subtitle.
SEC. 652. RESERVATION OF UNITS FOR DISABLED FAMILIES.

(a) REQUIREMENT.—^Notwithstanding any other provision of law,
for any project for which an owner gives preference in occupancy
to elderly families pursuant to section 651, such owner shall (subject
to sections 653, 654, and 655) reserve imits in the project for
occupancy only by disabled families who are not elderly or nearelderly families (and who have applied for occupancy in the housing)
in the number determined under subsection (b).
(b) NUMBER OF UNITS.—Each owner required to reserve imits
in a project for occupancy under subsection (a) shall reserve a
number of units in the project that is not less than the lesser
of—
(1) the number of units equivalent to the higher of—

42 u s e 13612.

106 STAT. 3824

PUBLIC LAW 102-550—OCT. 28, 1992
(A) the percentage of units in the project that were
occupied by such disabled families upon the date of the
enactment of this Act; or
(B) the percentage of units in the project that were
occupied by such families upon January 1,1992; or
(2) 10 percent of the number of units in the project.

42 u s e 13613.

SEC. 663. SECONDARY PREFERENCES.
(a) INSUFFICIENT ELDERLY FAMILIES.—If

an owner of a covered
section 8 housing project in which elderly families are given a
preference for occupancy pursuant to section 651 determines (in
accordance with regulations established by the Secretary) that there
are insufficient numbers of elderly families who have applied for
occupancy in the housing to fill all the units in the project not
reserved under section 652, the owner may give preference for
occupancy of such units to disabled families who are near-elderly
families and have applied for occupancy in the housing.
(b)

INSUFFICIENT NON-ELDERLY DISABLED FAMILIES.—If

an

owner of a covered section 8 housing project in which elderly families are given a preference for occupancy pursuant to section 651
determines (in accordance with regulations established by the Secretary) that there are insufiicient numbers of disabled families
who are not elderly or near-elderly families and have applied for
occupancy in the housing to fill all the units in the project reserved
under section 652, the owner may ^ve preference for occupancy
of units so reserved to disabled families wno are near-elderly families and have applied for occupancy in the housing.
42USC13614.

SEC. 654. GENERAL A V A I L A B I U T Y OF UNITS.

If an owner of a covered section 8 housing project in which
disabled families who are near-elderly families are given a preference for occupancy pursuant to subsection (a) or (b) of section
653 determines (in accordance with regulations established by the
Secretary) that there are an insufficient number of such families
to fill aJl the units in the project for which the preference is
applicable, the owner shall make such units generally available
for occupancy by families who have applied, and are eligible, for
occupancy in the housing, without regard to the preferences established pursuant to this subtitle.
42 u s e 13615.

SEC. 665. PREFERENCE WITHIN GROUPS.

Among disabled families qualifying for occupancy in units
reserved imder section 652, and among elderly families and nearelderly families qualifying for preference for occupancy pursuant
to section 651 or 653, preference for occupancy in units that are
assisted imder section 8 of the United States Housing Act of 1937
shall be given to disabled families according to the preferences
for occupancy referred to in section 8(dXlXAXi) of the United States
Housing Act of 1937 and the first sentence of section 8(oX3XB)
of such Act, to elderly families according to such preferences, and
to near-elderly families according to such preferences, respectively.
42 u s e 13616.

SEC. 666. PROmBITION OF EVICTIONS.

Any tenant who, except for reservation of a percentage of the
units of a project pursuant to section 652 or anv preference for
occupancy established pursuant to this subtitle, is lawfully residing
in a dwelling unit in a covered section 8 housing project, may
not be evicted or otherwise required to vacate such unit because

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3825

of the reservation or preferences or because of any action taken
by the Secretary of Housing and Urban Development or the owner
of the project pursuant to this subtitle.
SEC. 6S7. TREATMENT OF COVERED SECTION 8 HOUSING NOT SUB- 42 USC 13617.
JECT TO ELDERLY PREFERENCE.

If an owner of any covered section 8 housing project designed
primarily for occupancy by elderly families does not give preference
in occupancy to elderly families as authorized in this subtitle,
then elderly families (as such term was defined in section 3 of
the United States Housing Act of 1937 before the date of the
enactment of this Act) shall be eligible for occupancy in such housing
to the same extent that such families were eligible before the
date of the enactment of this Act.
SEC. 658. TREATMENT OF OTHER FEDERALLY ASSISTED HOUSING.
42 USC 13618.
(a) RESTRICTED OCCUPANCY.—An owner of any federally

assisted project (or portion of a project) as described in subparagraphs (D), (E), and (F) of section 683(2) that was designed for
occupancy by elderly families may continue to restrict occupancy
in such project (or portion) to elderly families in accordance with
the rules, standards, and agreements governing occupancy in such
housing in effect at the time of the development of the housing.
(b) PROHIBITION OF EVICTIONS.—Any tenant who is lawfully
residing in a dwelling tinit in a housing project described in subsection (a) may not be evicted or otherwise required to vacate
such imit because of £uiy reservation or preferences under this
subtitle or because of any action taken by the Secretary of Housing
£uid Urban Development or the owner of the project pursuant to
this subtitle.
SEC. 659. COVERED SECTION 8 HOUSING.

42 USC 13619.

For purposes of this subtitle, the term "covered section 8 housing" means housing described in section 683(2XG) that was originally designed for occupancy by elderly families.
SEC. 660. SECTION 8 PREFERENCE.

Section 8(d) of the United States Housing Act of 1937 (42
U.S.C. 1437fld)) is amended by adding at the end the following
new paragraph:
"(4) A public housing agency that serves more than one imit
of general local government may, at the discretion of the agency,
in allocating assistance under this section, give priority to disabled
families that are not elderly families.".
SEC. 661. STUDY.

Reports.

The Secretary of Housing £md Urban Development shall conduct 42 USC 13620.
a study to determine the extent to which Federal housing programs
serve elderly families, disabled families, and families with children,
in relation to the need of such families who are eligible for assistance under such programs. The Secretary shall submit a report
to the Congress describing the study and the findings of the study
not later than the expiration of the 1-year period beginning on
the date of the enactment of this Act.

106 STAT. 3826

PUBLIC LAW 102-550—OCT. 28, 1992

Subtitle E—Service Coordinators for Elderly and Disabled Residents of Federally Assisted Housing
42 u s e 13631.

SEC. 671. REQUIREMENT TO PROVIDE SERVICE COORDINATORS.

(a) IN GENERAL.—^To the extent that amounts are made available to carry out this subtitle pursuEint to the amendments made
by this subtitle, the Secretary shall require owners of covered
federally assisted housing projects (as such term is defined in
subsection (d)) receiving such amounts to provide for employing
or otherwise retaining the services of one or more individuals to
coordinate the provision of supportive services for elderly and disabled families residing in the projects (in this section referred
to as a "service coordinator"). No such elderly or disabled family
may be required to accept services.
(b) RESPONSIBILITIES.—Each service coordinator of a covered
federally assisted housing project provided pursuant to this subtitle
or the amendments made by this subtitle—
(1) shall consult with the owner of the housing, tenants,
any tenant organizations, any resident management organizations, service providers, and any other appropriate persons,
to identify the particular needs and characteristics oi elderly
and disabled families who reside in the project and any supportive services related to such needs and characteristics;
(2) shall manage and coordinate the provision of such services for residents of the project;
(3) may provide training to tenants of the project in the
obligations of tenancy or coordinate such training;
(4) shall meet the minimum qualifications and standards
required under section 802(dX4) of the Cranston-Gronzalez
National Affordable Housing Act; and
(5) may carry out other appropriate activities for residents
of the project.
(c) INCLUDED SERVICES.—Supportive services referred to under
subsection (bXD may include health-related services, mentel health
services, services for nonmedical counseling, meals, transportetion,
personal care, bathing, toileting, housekeeping, chore assistence,
safety, group and socialization activities, assistance with medications (in accordance with any applicable Stete laws), case management, personal emergency response, and other appropriate services.
The services may be provided through any agency of the Federal
Grovemment or any other public or private department, agency,
or organization.
(d) COVERED FEDERALLY ASSISTED HOUSING.—For purposes of
this subtitle, the term "covered federally assisted housing^^ means
housing that is federally assisted housing (as such term is defined
in section 683(2), except that such term does not include housing
described in subparagraphs (C) and (D) of such section.
SEC. 672. REQUIRED TRAINING OF SERVICE COORDINATORS.

Section 802(dX4) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 8011(dX4)) is amended by inserting after
the period at the end of the first sentence beginning after siibparagraph (E) the following new sentence: "Such qualifications and
stendards shall include requiring each service coordinator to be

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3827

trained in the aging process, elder services, disability services,
eligibility for and proceaures of Federal and applicable State entitlement propp*am8, legal liability issues relating to providing service
coordination, drug and alcohol use and abuse by the elderly, and
mental healtii issues.".
SEC. 673. COSTS OF PROVIDING SERVICE COORDINATORS IN PUBUC
HOUSING.

Section 9(aXlXB) of the United States Housing Act of 1937
(42 U.S.C. 1437g(aXlXB)) is amended—
(1) in the first sentence, by redesignating clauses (i) and
(ii) as subclauses (I) and (II), respectively;
(2) in the second sentence—
(A) by striking "subpara^aph" and inserting "clause";
(B) by inserting "or section 802 of the Cranston-Gonzalez National Affordable Housing Act" after "Congregate
Housing Services Act of 1978"; and
(C) by inserting a period after "section 811 of the
Cranston-Gonzalez National Affordable Housing Act";
(3) by inserting "(i)" after the subparagraph designation;
and
(4) by adding at the end the following new clause:
"(ii) Annual contributions under this section to any public housing agency for any project may be used, with respect to such
project, for (I) the cost of employing or otherwise retaining the
services of one or more service coordinators under section 661
of the Housing and Community Development Act of 1992 to coordinate the provision of any supportive services within the project
for residents of the project who are elderly families and disabled
families, and (II) expenses for the provision of such services for
such residents of the project. Not more than 15 percent of the
cost of the provision of^ such services may be provided under this
section. Services may not be provided under this clause for any
person receiving assistance under the Congregate Housing Services
Act of 1978 or section 802 of the Cranston-Gonzalez National Affordable Housing Act. The budget authority available imder section
5(c) for assistance under this section is authorized to be increased
by $30,000,000 on or after October 1, 1992, and by $30,000,000
on or after October 1, 1993. Amounts made available under this
clause shall be used to provide additional annual contributions
to public housing agencies only for the purpose of providing service
coordinators and services under this clause for public housing
projects.".
SEC. 674. COSTS OF PROVIDING SERVICE COORDINATORS
PROJECT-RASED SECTIONS HOUSING.

IN

Section 8(dX2) of the United States Housing Act of 1937 (42
U.S.C. 1437f(dX2)) is amended by adding at the end the following
new subparagraph:
"(FXi) In determining the amount of assistance provided under
an assistance contract for project-based assistance under this paragraph or a contract for assistance for housing constructed or
substantially rehabilitated pursuant to assistance provided under
section 8(bX2) of this Act (as such section existed immediately
before October 1, 1983), the Secretary may consider and annually
adjust, with respect to such project, for the cost of employing or
otherwise retaining the services of one or more service coordinators
under section 661 of the Housing and Community Development

106 STAT. 3828

PUBLIC LAW 102-550—OCT. 28, 1992

Act of 1992 to coordinate the provision of any services within
the project for residents of the project who are elderly or disabled
families.
"(ii) The budget authority available under section 5(c) for assistance under this section is authorized to be increased by $15,000,000
on or after October 1, 1992, and by $15,000,000 on or after October
1, 1993. Amounts made avsdlable under this subparagraph shall
be used to provide additional sunounts under annual contributions
contracts for assistance under this section which shall be made
available through assistance contracts ovly for the purpose of
providing service coordinators under clause (i) for projects receiving
project-based assistance under this paragraph ana to provide additional amounts imder contracts for assistance for projects constructed or substantiallv rehabilitated pursuant to assistance provided under section 8(bX2) of this Act (as such section existed
immediately before October 1,1983) only for such purpose.".
SEC. 67S. COSTS OF PROVIDING SERVICE COORDINATORS FOR FAMILIES RECEIVING FEDERAL TENANT-BASED ASSISTANCE.

Section 8(q) of the United States Housing Act of 1937 (42
U.S.C. 1437fi:q)) is amended—
(1) by redesi^ating paragraph (3) as paragraph (4); and
(2) bv insertmg after paragraph (2) the following new
paragrapn:
(3XA) Fees under this subsection may be used for the costs
of employing or otherwise retaining the services of one or more
service coormnators under section 661 of the Housing and Community Development Act of 1992 to coordinate the provision of supportive services for elderly families and disabled families on wnose
behalf tenant-based assistance is provided under this section or
section 811(bXl)- Such service coordinators shall have the same
responsibilities with respect to such families as service coordinators
of covered federally assisted housing projects have under section
661 of such Act with respect to residents of such projects.
"(B) To the extent amounts are provided in appropriation Acts
under subparagraph (C), the Secretary shall increase fees under
this subsection to provide for the costs of such service coordinators
for public housing agencies.
"(C) The budget authority available under section 5(c) for assistance under this section is authorized to be increased by $5,000,000
on or after October 1, 1992, and bv $5,000,000 on or after
October 1, 1993. Amounts made available under this subparagraph
shall be used to provide additional amounts imder annual contributions contracts for increased fees under this subsection, which shall
be used only for the purpose of providing service coordinators for
public housing agencies described m subparagraph (A).".
42 u s e 13632.

SEC. 676. GRANTS FOR COSTS OF PROVIDING SERVICE COORDINATORS IN MULTIFAMILY HOUSING ASSISTED UNDER
NATIONAL HOUSING ACT.

(a) AUTHORITY.—^The Secretary may make grants under this
section to owners of federally assisted housing projects described
in subparagraphs (E) and (F) of section 683(2). Any grant amounts
shall be used for the costs of employing or otherwise retaining
the services of one or more service coordinators under section 661
to coordinate the provision of any services within the project for
residents of the project who are elderly families and disabled families (as such terms are defined in section 683 of this Act).

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3829

(b) APPUCATION AND SELECTION.—The Secretary shall provide
for the form and manner of applications for grants under this
section and for selection of applicants to receive such grants.
(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated for fiscal years 1993 and 1994 such sums as
may be necessary for grants imder this section.
(d) EUGIBLE PROJECT EXPENSE.—For any federally assisted
housing project described in subparagraph (E) or (F) of section
683(2) that does not receive a grant under this section, the cost
of emplojdng or otherwise retaming the services of one or more
service coordinators under section 661 and not more than 15 percent
of the cost of providing services to the residents of the project
shall be considered an eligible project expense, but only to the
extent that amounts are available fi*om project rent and other
income for such costs.
SEC. 677. EXPANDED RESPONSIBILrnES OF SERVICE COORDINATORS
IN S E C T I O N 202 HOUSING.
(a) SUPPORTIVE HOUSING FOR THE ELDERLY.—Section 202(g)

of the Housing Act of 1959 (12 U.S.C. 1701q(g)), as amended by
section 801 of the Cranston-Gonzalez National AiTordable Housing
Act, is amended—
(A) in paragraph (2), by striking the last sentence; and
(B) by adding at the end the following new paragraph:
"(3) SERVICE COORDINATORS.—Any cost associated with
emplojring or otherwise retaining a service coordinator in housing assisted under this section shall be considered an eligible
cost under subsection (cX2). If a project is receiving congregate
housing services assistance under section 802 of the CranstonGonzalez National Affordable Housing Act, the amount of costs
provided under subsection (cX2) for the project service coordinator may not exceed the additional amount necessary to cover
the costs of providing for the coordination of services for residents of the project who are not eligible residents under such
section 802. To the extent that amoimts are available pursuant
to subsection (cX2) for the costs of carrying out this paragraph
within a project, an owner of housing assisted under this section
shall provide a service coordinator for the housing to coordinate
the provision of services under this subsection within the housing.".
(b) OLD SECTION 202 PROJECTS.—
12 use noiq
(1) AVAILABILITY OF SECTION S ASSISTANCE.—Subject to the

availabilitv of appropriations for contract amendments for the
purpose of this paragraph, in determining the amoimt of assistance under section 8 of the United States Housing Act of
1937 to be provided for a project assisted under section 202
of the Housing Act of 1959, as in efiPect before the effectiveness
of the amendments made by section 801 of the Cranston-Gonzalez National Affordable Housing Act, the Secretary shall consider (and annually adjust for) the costs of—
(A) employing or otherwise retaining the services of
one or more service coordinators under section 661 of this
Act to coordinate the provision of any services within the
project for residents or the project who are elderly families
ana disabled families; and
(B) expenses for the provision of such services.

"*
°®

106 STAT. 3830
A

PUBLIC LAW 102-550—OCT. 28, 1992
Not more than 15 percent of the cost of the provision of services
under subparagraph (B) may be considered under this paragraph for purposes of determining the amount of assistance
provided.
(2) INAPPUCABILITY OP HUD REFORM ACT PROVISIONS.—Notwithstanding section 102 of the Department of Housing and
Urban Development Reform Act of 1989, the provisions of paragraphs (1), (2), and (3) of subsection (a) of such section shall
not apply to amendments to contracts imder section 8 of the
United States Housing Act of 1937 made to carry out the
purposes of paragraph (1) of this subsection.
(3) LIMITATION.—If a project is receiving congregate housing services assistance under the Congregate Housing Services
Act of 1978 or section 802 of the Cranston-Gronzalez National
Affordable Housing Act, the amount of costs provided pursuant
to paragraph (1) for the project may not exceed the additional
amoimt necessary to cover the costs of providing for the
coordination of services for residents of the project who are
not eligible residents under such section 802 or eligible project
residents imder the Congregate Housing Services Act of 1978,
as applicable.

Subtitle F—General Provisions
SEC. 681. COMPREHENSIVE HOUSING AFFORDABHfTY STRATEGIES.
Section 105(b) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12705(b)) is amended—
(1) in paragraph (1) by inserting ''persons with disabilities,"
after "the elderly, ; and
(2) by adding aft«r paragraph (16), as added by the preceding provisions of this Act, the following new paragraph:
"(17) describe the jurisdictions activities to enhance
coordination between public and assisted housing providers
and private and governmental health, mental health, and service agencies.".
SEC. 682. CONFORMING AMENDMENTS.
(a) PUBLIC HOUSING.—Section 6(cX4) of the United States Housing Act of 1937 (42 U.S.C. 1437d(cX4)) is amended—
(1) by striking "and" at the end of subparagraph (D);
(2) by striking the period at the end of subparagraph (E)
and inserting "; and"; and
(3) by adding at the end the following new subparagraph:
"(F) reqmring the public housing agencv to ensure
and maintam compliance with subtitle C of title VI of
the Housing and Community Development Act of 1992
and any regulations issued under such subtitle.".
(b) PROJECT-BASED SECTION 8 HOUSING.—Section 8(dX2) of the
United States Housing Act of 1937 (42 U.S.C. 1437f(dX2)), as
amended by section 664 of this Act, is further amended by adding
at the end the following new subparagraphs:
"(G) An assistance contract for project-based assistance
under this paragraph shall provide that the OMnier shall ensure
and maintain compliance with subtitle C of title VI of the
Housing and Community Development Act of 1992 and any
regulations issued under such subtitle.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3831

"(H) Notwithstanding subsection (dXlXAXi)> an owner of
a covered section 8 housing project (as such term is defined
in section 659 of the Housing and Communily Development
Act of 1992) may give preference for occupancy of dwelling
units in the project, and reserve units for occupancy, in accordance with subtitle D of title VI of the Housing and Community
Development Act of 1992.".
(c) SUPPORTIVE HOUSING FOR THE ELDERLY.—Section 202

of

the Housing Act of 1959 (12 U.S.C. 1701q), as amended by section
801 of the Cranston-Gonzalez National Affordable Housing Act,
is amended—
(1) in subsection (iXD, by inserting after the first sentence
the following new sentence: "Such tenant selection procedures
shall comply with subtitle C of title VI of the Housing and
Community Development Act of 1992 and any regulations
issued under such subtitle."; and
(2) in subsection (j), by adding after paragraph (6) (as
addeid by section 601(d) of this Act) the following new paragraph:
"(7) COMPLIANCE WITH HOUSING AND COMMUNITY DEVELOP-

MENT ACT OF 1992.—^Each Owner shall operate housing assisted
under this section in compliance with subtitle C of title VI
of tiie Housing and Community Development Act of 1992 and
any regulations issued under such subtitle.".
SEC. 683. DEFINITIONa

For purposes of this title:
(1) ELDERLY, DISABLED, AND NEAR-ELDERLY FAMILIES.—The

terms "elderly family", "disabled family", and "near-elderly family" have the meamngs given the terms under section 3(bX3)
of the United States Housing Act of 1937.
(2) FEDERALLY ASSISTED HOUSING.—The terms "federally
assisted housing" and "project" mean—
(A) a public housing project (as such term is defined
in section 3(b) of the United States Housing Act of 1937);
(B) housing for which project-based assistance is provided under section 8 of the United States Housing Act
of 1937;
(C) housing that is assisted under section 202 of the
Housing Act of 1959 (as amended by section 801 of the
Cranston-Gonzalez National Affordable Housing Act);
(D) housing that is assisted under section 202 of the
Housing Act of 1959, as such section existed before the
enactment of the Cranston-Gonzalez National Affordable
Housing Act;
(E) housing financed by a loan or mortgage insured
under section 221(dX3) of tne National Housing Act that
bears interest at a rate determined imder the proviso of
section 22 l(dX5) of such Act;
(F) housing insured, assisted, or held by the Secretary
or a State or State agency under section 236 of the National
Housing Act; and
(G) housing constructed or substantially rehabilitated
pursuant to assistance provided under section 8(bX2) of
thte United States Housing Act of 1937, as in effect before
October 1,1983, that is assisted under a contract for assistance under such section.

59-194 O—93

7:QL3(Pt5)

42 USC13641.

106 STAT. 3832

PUBLIC LAW 102-550—OCT. 28, 1992
(3) HOUSING ASSISTANCE.—The term 'liousing assistance"
means, with respect to federally assisted housing, the grant,
contribution, capital advance, loan, mortgage insurance, or
other assistance provided for tiie housing under the provisions
of law referred to in parafipraph (2). The term also includes
any related assistance provided for the housing by the Secretary, including any rental assistance for low-income occupants.
(4) OWNER.—The term "owner** means, with respect to federally assisted housing, the entity or private person, including
a cooperative or pubuc housing agenpy, that has the legcQ
right to lease or sublease dwelling umts in such housing.
(5) SECRETARY.—^The term "Secretarjr** means the Secretary
of Housing and Urban Development.

42 u s e 13642.

SEC. 684. A P P U C A B H I T Y .

Except as otherwise provided in subtitles B through F of this
title and the amendments made by such subtitles, such subtitles
and the amendments made by such subtitles shall apply upon
the expiration of the 6-month period beginning on the date of
the enactment of this Act.
42 u s e 13643.

SEC. 685. REGULATIONa

The Secretary shall issue relations necessary to carry out
subtitles B through F of tiiis title and the amendments made
by such subtitles not later than the expiration of the 6-month
period beginning on the date of the enactment of this Act. The
regulations shall be issued after notice and opportunity for public
comment pursuant to the provisions of section 553 of title 5, United
States Code (notwithstanding subsections (aX2), (bXB), and (dX3)
of such section).

TITLE Vn—RURAL HOUSING
SEC. 701. PROGRAM AUTHORIZATIONS.
(a) INSURANCE AND GUARANTEE AUTHORITY.—Section 513(aXl)

of the Housing Act of 1949 (42 U.S.C. 1483(aXl)) is amended
to read as follows:
"(a) IN GENERAL.—(1) The Secretarv may, to the extent
approved in appropriation Acts, insure and guarantee loans under
this title during fiscal years 1993 and 1994, in aggregate amounts
not to exceed $2,446,855,600 and $2,549,623,535, respectively, as
follows:
"(A) For insured or guaranteed loans under section 502
on behalf of low-income borrowers receiving assistance under
section 521(aXl), $1,676,484,000 for fiscal year 1993 and
$1,746,896,328 forfiscalyear 1994.
"(B) For guaranteed loans under section 502(h) on behalf
of low- and moderate-income borrowers, such sums as may
be appropriated forfiscalyears 1993 and 1994.
"(C) For loans under section 504, $12,400,000 for fiscal
year 1993 and $12,920,800 forfiscalyear 1994.
"(D) For insured loans under section 514, $16,821,600 for
fiscal year 1993 and $17,528,107 forfiscalyear 1994.
"(E) For insured loans under section 515, $739,500,000
for fiscal year 1993 and $770,559,000 for fiscal year 1994.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3833

"(F) For loans under section 523(bXlXB), $800,000 for fiscal
year 1993 and $833,600 forfiscalyear 1994.
"(G) For site loans under section 524, $850,000 for fiscal
year 1993 and $885,700 forfiscalyear 1994.".
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 513(b) of the
Housing Act of 1949 (42 U.S.C. 1483(b)) is amended to read as
follows:
"(b) AUTHORIZATION OP APPROPRIATIONS.—There are authorized
to be appropriated for fiscal years 1993 and 1994, and to remain
available until expended, the following amounts:
"(1) For grants under section 502(fKl), $1,100,000 for fiscal
year 1993 and $1,146,200 forfiscalyear 1994.
"(2) For grants under section 504, $21,100,000 for fiscal
year 1993 and$21,986,200 forfiscalyear 1994.
"(3) For purposes of section 509(c), $600,000 for fiscal year
1993 and $625,200 forfiscalyear 1994.
"(4) For project preparation grants under section 509(fX6),
$5,300,000 in fiscal year 1993 and $5,522,600 in fiscal year
1994.
"(5) In fiscal years 1993 and 1994, such sums as may
be necessary to meet payments on notes or other obligations
issued by the Secretary under section 511 equal to—
"(A) tlie aggregate of the contributions made by the
Secretary in the form of credits on principal due on locuis
made pursuant to section 503; and
"(B) the interest due on a similar sum represented
bv notes or other obUgations issued by the Secretary.
"(6) For grants for service coordinators under section 515(y),
$1,000,000 in fiscal year 1993 and $1,042,000 in fiscal year
1994.
"(7) For financial assistance under section 516—
"(A) for low-rent housing and related facilities for
domestic farm labor under subsections (a) through (j) of
such section, $21,700,000 for fiscal year 1993 and
$22,611,400 forfiscalvear 1994; and
"(B) for housing for rural homeless and migrant farmworkers under subsection (k) of such section, $10,500,000
for fiscal year 1993 and $10,941,000 for fiscal year 1994.
"(8) For grants under section 523(f), $13,900,000 for fiscal
year 1993 and $14,483,800 forfiscalyear 1994.
"(9) For grants imder section 533, $30,800,000 for fiscal
year 1993 and $32,093,600 forfiscalyear 1994.".
(c)

RENTAL

ASSISTANCE

PAYMENT

CONTRACTS.—Section

513(cXl) of the Housing Act of 1949 (42 U.S.C. 1483(cXl)) is
amended to read as follows:
"(c) RENTAL ASSISTANCE.—<1) The Secretary, to the extent
approved in appropriations Acts for fiscal years 1993 and 1994,
may enter into rental assistance pa3rment contracts imder section
521(aX2XA) aggregating $414,100,000 for fiscal year 1993 and
$431,492,200 forfiscalyear 1994.".
(d) SUPPLEMENTAL RENTAL ASSISTANCE PAYMENT CONTRACTS.—

Section 513(d) of the Housing Act of 1949 (42 U.S.C. 1483(d))
is amended to read as follows:
"(d) SUPPLEMENTAL RENTAL ASSISTANCE CONTRACTS.—The Secretary, to the extent approved in appropriations Acts for fiscal
years 1993 and 1994, may enter into 5-year supplemental rental
assistance contracts under section 502(cX5XJD) aggregating

106 STAT. 3834

PUBLIC LAW 102-550—OCT. 28, 1992

$12,178,000 for fiscal year 1993 and $12,689,476 for fiscal year
1994.".
(e) RENTAL HOUSING LOAN AUTHORITY.—Section 515(bX4) of
the Housing Act of 1949 (42 U.S.C. 1485(bX4)) is amended by
striking "September 30, 1992" and inserting "September 30, 1994 .
(f) RURAL HOUSING VOUCHER PROGRAM.—Section 513(e) of the
Housing Act of 1949 (42 U.S.C. 1483(e)) is amended to read as
follows:
"(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated for rural housing vouchers under section 542,
$130,000,000 for fiscal year 1993 and $140,000,000 for fiscal year
1994.".
(g) DEFERRED MORTGAGE DEMONSTRATION.—Section 502(gX3)
of the Housing Act of 1949 (42 U.S.C. 1472(gX3)) is amended
by striking "1991 and 1992" and inserting "1993 and 1994".
SEC. 702. ELIOmiLnY OF HOMES ON LEASED LAND OWNED BY
COMMUNITY LAND TRUSTS FOR SECTION 602 LOANS.

(a) EUGIBILITY.—Section 502(a) of the Housing Act of 1949
(42 U.S.C. 1472(a)) is amended by adding at the end the following
new paragraph:
"(3XA) Notwithstanding any other provision of this title, a
loan may be made under this section for the purchase of a dwelling
located on land owned by a community land trust, if the borrower
and the loan otherwise meet the requirements applicable to loans
under this section.
"(B) For purposes of this paragraph, the term 'community land
trust' means a community housing development organization as
such term is defined in section 104 of the Cranston-Gronzalez
National Affordable Housing Act (except that the requirements
under section 104(6XC) and section 104(6XD) shall not apply for
purposes of this paragraph)—
"(i) that is not sponsored by a for-profit organization;
"(ii) that is established to carry out the activities under
clause (iii);
"(iii)that—
"(I) acquires parcels of land, held in perpetuity, primarily for conveyance under long-term ground leases;
"(II) transfers ownership of any structural improvements located on such leased parcels to the lessees; and
"(III) retains a preemptive option to purchase any such
structural improvement at a price determined by formula
that is designed to ensure that the improvement remains
affordable to low- and moderate-income families in perpetuity; and
"(iv) that has ite corporate membership open to any adult
resident of a particular geographic area specified in the bylaws
of tlie Organization.".
(b) RECAPTURE.—Section 521(aXlXD) of the Housing Act of
1949 (42 U.S.C. 1490a(aXlXD)) is amended—
(1) by inserting "(i)" afl^r "(D)"; and
(2) by adding at the end the following new clause:
"(ii) In determimng the amount recaptured under this subparagraph with respect to any loan made pursuant to section 502(aX3)
for the purchase of a dwelling located on land owned by a community land trust, the Secretory shall determine any appreciation
of the dwelling based on any agreement between the borrower

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3835

and the community land trust that limits the sale price or appreciation of the dwelling.".
SEC. 703. MAXIMUM INCOME OF BORROWERS UNDER GUARANTEED
LOANS.

Section 502(hX2) of the Housing Act of 1949 (42 U.S.C.
1472(hX2)) is amended by inserting **115 percent oP after "exceed".
SEC. 704. REMOTE RURAL AREAS.

Section 502(0 of the Housing Act of 1949 (42 U.S.C. 1472(f))
is amended—
(1) in paragraph (1), by inserting "or on tribal allotted
or Indian trust land" after "area"; and
(2) in paragraph (2), by inserting "or on tribal allotted
or Indian trust land" before the period.
SEC. 706. DESIGNATION OF UNDERSERVED AREAS AND RESERVATION
OF ASSISTANCE.
(a) REAUTHORIZATION OF DESIGNATION.—Section 509(0 of the

Housing Act of 1949 (42 U.S.C. 1479(0) is amended—
(1) in paragraph (1), by striking "in each of fiscal years
1991 and 1992" ana inserting "in each fiscal year";
(2) in paragraph (2), by inserting at the end the following
new flush sentence:
"In designating underserved areas under paragraph (1), in each
fiscal year the Secretary shall designate not less than 5 counties
or communities that contain tribal allotted or Indian trust
land."; and
(3) in paragraph (4), by striking "an amount equal to 3.5
percent in fiscal year 1991 and 5.0 percent in fiscal year 1992"
and inserting "an amoiuit equal to 5.0 percent in fiscal years
1993 and 1994".
(b) DEFINITION OF COLONIAS.—Section 509(0(8) of the Housing
Act of 1949 (42 U.S.C. 1479(0(8)) is amended—
(1) by strikin|r subparagraph (C);
(2) by redesignating subparagraph (D) as subparagraph
(C); and
(3) by striking subparagraph (E) and inserting the following
new subparagraph:
"(D) was in existence as a colonia before the date
of the enactment of the Cranston-Cjonzalez National Affordable Housing Act.".
(c) COLONIAS REFINEMENTS.—Section 509(fX4XBXii) of the
Housing Act of 1949 (42 U.S.C. 1479(0(4XBXii)) is amended by
inserting before "a colonia", the following ", or in close proximity
to, and serving the residents of,".
SEC. 706. RURAL HOUSING VOUCHER PROGRAM.

Title V of the Housing Act of 1949 (42 U.S.C. 501 et seq.)
is amended—
(1) in the last sentence of section 533(a) (42 U.S.C.
1490m(a)), by inserting after "1937" the following: "or section
542 ofthis title"; and
(2) by adding at the end the following new section:
•^EC. 542. RURAL HOUSING VOUCHER PROGRAM.

"(a) IN GENERAL.—^To such extent or in such amoimts as are
approved in appropriation Acts, the Secretary shall carry out a

42 USC 1490r.

106 STAT. 3836

PUBLIC LAW 102-550—OCT. 28, 1992

rural housing voucher program to assist very low-income families
and persons to reside m rental housing in rural areas. For such
purposes, the Secretary may provide assistance using a payment
standard based on the fair market rental rate established by the
Secretary for the area. The monthly assistance pajrment for any
family snail be the amount by which the payment standard for
the area exceeds 30 per centum of the familys monthly adjusted
income, except that such monthly assistance payment shall not
exceed the amount which the rent for the dwelling imit (including
the amount allowed for utilities in the case of a unit with separate
utility metering) exceeds 10 per centum of the familjr's monthly
gross income.
"(b) COORDINATION AND LIMITATION.—In carrying out the rural
housing voucher program imder this section, the Secretary shall—
"(1) coordinate activities under this section with activities
assisted under sections 515 and 533 of this title; and
"(2) enter into contracts for assistance for not more than
5000 units in any fiscal year.".
SEC. 707. RENTAL HOUSING LOANS.
(a) DEVELOPMENT COSTS.—Section 515(eX4) of the Housing Act

of 1949 (42 U.S.C. 1485(eX4)) is amended—
(1) by striking "and" before "initial";
(2) by inserting before the first period the following: ",
impact fees, local charges for installation, provision, or use
of infrastructure, and local assessments for public improvements and services imposed by State and local governments";
and
(3) by inserting after the period at the end the following
new sentence: "Notwithstanding the first sentence of this paragraph, the term 'development cost' shall not include any initial
operating expenses in the case of any nonprofit corporation
or consumer cooperative that is financing housing under this
section and has been allocated a low-income housing tax credit
by a housing credit agency pursuant to section 42 of the
Internal Revenue Code of 1986.".
(b)

COORDINATION OF LOANS AND RENTAL ASSISTANCE PAY-

MENTS.—Section 515 of the Housing Act of 1949 (42 U.S.C. 1485)
is amended—
(1) in subsection (1), by striking paragraph (1) and inserting
the following new paragraph:
"(1) in the case of any applicant who applies for rental
assistance payments under section 521 in connection with such
project, the Secretary shall consider the availability of such
rental assistance payments with respect to the project and
shall require such applicant to demonstrate that a market
exists for persons and families eligible for such rental assistance
payments; and"; and
(2) in subsection (p)—
(1) in paragraph (4), by striking ", except" in the first
sentence and all that follows through the end of the paragraph and inserting a period; and
(2) by inserting at the end the following new
paragraph:
"(5) The Secretary shall coordinate the processing of any
application for a loan under this section for a project and the
processing of any application for assistance under section 521(aX2)

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3837

with respect to housing units in the same project in an economical
and efficient manner. At the time the Secretary enters into a
commitment to make or insure a loan under tiiis section the Secretary shall obligate amoimts for assistance pajrments under section
521(aX2) for the project, to the extent that such amounts are
available and the Secretary determines such assistance is necessary
for the market feasibility of the prmect.".
(c) EQUITY CONTRIBUTION.—Section 515(rX2) of the Housing
Act of 1949 (42 U.S.C. 1485(rX2)) is amended bv inserting before
the period at the end the following: ", except that the Secretary
shall reauire a 5 percent contribution in the case of a project
that is allocated a low-income housing tax credit pursuant to section
42 of the Internal Revenue Code of 1986".
(d) UNIFORM PROJECT COSTS AND COORDINATION OF HOUSING
RESOURCES AND TAX BENEFITS.—Section 515 of the Housing Act

of 1949 (42 U.S.C. 1485) is amended by adding at the end the
following new subsection:
"(x) UNIFORM PROJECT COSTS; COORDINATION OF HOUSING
RESOURCES AND TAX BENEFITS.—^The Secretary shall—

"(1) establish standard guidelines for State offices that
describe allowable development costs which are required for
development of all projectis imder this section, without regard
to whether the project was allocated a low-income housing
tax credit;
"(2) require each State to establish a process for coordinating the selection of projects under this section with the housing
needs and priorities as established in a State comprehensive
housing affordability strategy under section 105 of the Cranston-Gonzalez National Affordable Housing Act and a lowincome housing tax credit allocation plan under section 42
of the Internal Revenue Code of 1986; and
"(3) develop, in consultation with housing credit agencies
(as that term is defined under section 42 of the Internal Revenue Code of 1986), uniform procedures for identifying and sharing information on project costs, builder profit, identity of
interests relationships, and other factors, as appropriate, with
the relevant housing credit agency for projects that are allocated
a low-income housing tax credit pursuant to section 42(h) of
the Internal Revenue Code of 1986 for the purpose of achieving
compliance with section 102(d) of the Department of Housing
and Urban Development Reform Act of 1989 (42 U.S.C.
3546(d)).''.
(e) GRANTS FOR COSTS OF PROVIDING SERVICE COORDINATORS.—

Section 515 of the Housing Act of 1949 (42 U.S.C. 1485), as amended
by this section, is further amended by adding at the end the
following new subsection:
"(y) SERVICE COORDINATORS.—

"(1) GRANTS.—^The Secretary may make grants imder this
subsection, with respect to any project that the Secretary determines has a suffiaent number of frail elderly residents, for
the cost of employing or otherwise retaining the services of
one or more individuals to coordinate services provided to frail
elderly residents of the project (in this subsection referred
to as a 'service coordinator'), who shall be responsible for—
"(A) assessing the supportive service needs of frail
elderly residents of the project, based on objective criteria
and interviews with such residents;

106 STAT. 3838

PUBLIC LAW 102-550—OCT. 28, 1992
"(B) working with service providers to design the provision of services to meet the needs of frail elderly residents
of the project, taking into consideration the needs and
desires of such residents and their ability and willingness
to pay for such services, as expressed Dy the residents;
"(C) mobilizing public and private resources to obtain
funding for such services for such residents;
"(D) monitoring and evaluating the impact and
effectiveness of any supportive services provided for such
residents;
"(E) consulting and coordinating with any appropriate
public and private agencies regarding the provision of
supportive services; and
"(F) performing such other duties that the Secretary
deems appropriate to enable frail elderly persons residing
in federally assisted housing to live with dignity and
independence.
"(2) QUALIFICATIONS.—Individuals employed as service
coordinators pursuant to this subsection shall meet the minimum qualifications and standards established under section
802(dX4) of the Cranston-Gonzalez National Affordable Housing
Act for service coordinators under a congregate housing services
program.
"(3) APPLICATION AND SELECTION.—The Secretary shall provide for the form and manner of applications for grants under
this subsection and for the selection of applicants to receive
the grants.
"(4) DEFINITION OF FRAIL ELDERLY.—For purposes of this
subsection, the term 'frail elderl/ has the meaning given the
term in section 802(k) of the Cranston-Gonzalez National
Affordable Housing Act.".

..

^

(f) PROHIBITIONS REGARDING CONSIDERATIONS IN MAKING
LOANS.—
(1) IN GENERAL.—Section 515 of the Housing Act of 1949

(42 U.S.C. 1485), as amended by this section, is further
amended by adding at the end the following new subsection:
"(z) PROHIBITIONS.—
"(1) REMOTE RURAL AREAS.—The

^

Secretary may not refuse
to make a loan that otherwise complies with the requirements
under this section solely because the housing and related facilities involved are located in an area that is excessively rural
in character or excessively remote.
"(2) ESSENTIAL SERVICES.—In making loans imder this section, the Secretary may not provide any preference for any
project based on the availability of any particular essential
service. For purposes of this paragraph, an essential service
shall include post offices (and postal services), grocery stores,
pharmacies, schools, and health service facilities (and health
services).
"(3) GEOGRAPHIC LOCATION.—In making loans imder this
section, the Secretary may not grant or deny approval based
on the geographic location of the proposed project if the project
is located in a rural area, as such term is defined in section
520, except that the Secretary shall give preference to any
application for a project that will serve the needs of a rural
community located 20 or more miles from an urban area.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3839

(2) REGULATIONS.—The Secretary of Agriculture shall issue 42 use 1485
any regulations necessary to carry out the amendment made note.
by paragraph (1) not later than me expiration of the 45-day
period l^ginning on the date of the enactment of this Act.
Not later than the expiration of the 30-day period beginning
on the date of the enactment of this Act, the Secreta^ shall
submit a copy of any regulations to be issued under this subsection to tne Congress. Tlie reauirements of section 534(d)
of the Housing Act of 1949 and subsections (b) and (c) of
section 553 of title 5, United States Code, shall apply to any
such regulations.
(g) INDEPENDENT COST CERTIFICATIONS.—Section 517(jX3) of
the Housine Act of 1949 (42 U.S.C. 1487(jX3)) is amended by
inserting after 'industry," the following: 'independent audits of
project expenses,".
SEC. 708. NONPROFIT SET-ASIDE.

(a) IN GENERAL.—Section 515(w) of the Housing Act of 1949
(42 U.S.C. 1485(w)) is amended—
(1) in paragraph (1), by striking "not less than 7 percent
of the amounts available in fiscal year 1991 and not less than
9 percent of the amoimts available in fiscal year 1992" and
inserting "not less than 9 percent of the amounts available
in fiscal years 1993 and 1994*;
(2) in p£u:agraph (1), in the second sentence b^ striking
"or imder whole or partial control with a for-profit entity^
(3) in paragraph (1), by adding at the end the following
new sentence: '^A. partnership, that has as its general partner
a nonprofit entity or the nonprofit entitjr's for-profit subsidiary,
is eligible to receive fiinds set aside under this subsection
to sponsor a project which is receiving low-income housing
tax credits authorized imder section 42 of the Internal Revenue
Code of 1986. For the purposes of this subsection, a nonprofit
entity is an organization that—
"(A) will own an interest in a project to be financed
under this section and will materially participate in the
development and the operation of the project;
"(B) is a private organization that has nonprofit, tax
exempt status imder section 501(cX3) or section 501(cX4)
of the Internal Revenue Code of 1986;
"(C) has among its purposes the planning, development, or management of low-mcome housing or conmiunity
devel(MQment projects; and
"(D) is not affiliated with or controlled by a for-profit
organization.";
(4) in paragraph (2), by adding at the end the following:
"The Secretary may provide amounts available for re^dlocation
under this subsection in excess of $750,000 in a given State,
if such amounts are necessary to finance a project under this
section."; and
(5) by striking paragraph (3) and inserting the following:
"(3) UNUSED AMOUNTS.—
"(A) EQUITABLE DISTRIBUTION.—Any amounts

set aside
under this subsection firom the allocation for any State
that are not obligated by 9 months after the allocation,
shall first be pooled and made available to any other
eligible nonprofit entity in any State as defined in this

106 STAT. 3840

42 u s e 1485
note.

PUBLIC LAW 102-550—OCT. 28, 1992

subsection. The Secretary shall make reasonable efforts
to ensure that pooled funds are distributed under this
subparagraph in an equitable manner.
"(B) RETURN TO THE STATES.—After funds have been
pooled and obligated for 30 days, the Secretary shall return
any remaining funds to the States on a proportional basis
for use by any other eligible entity as defined in this
section.",
(b) EFFECTIVE DATE.—^The amendment made by subsection
(aX5) shall take effect on October 1, 1993, and shall apply to
fiscal year 1994 and each fiscal year thereafter.
SEC. 709. CONSIDERATION OF CERTAIN AREAS AS RURAL AREAS.

Section 520 of the Housing Act of 1949 (42 U.S.C. 1490) is
amended by adding at the end the following new sentence: 'Notwithstanding any other provision of this section, the city of Plainview,
Texas, shall be considered a rural area for purposes of this title.".
SEC. 710. PERMANENT AUTHORITY FOR SECTION 523.

Section 523 of the Housing Act of 1949 (42 U.S.C. 1490c)
is amended—

(2) by striking subsection (f).
SEC. 711. HOUSING PRESERVATION GRANTS FOR REPLACEMENT OF
HOUSING.

Section 533 of the Housing Act of 1949 (42 U.S.C. 1490m)
is amended—
(1) in subsection (a)—
(A) by inserting "or replace" after "rehabilitate" each
place it appears; and
(B) in the second sentence, by inserting "or replaced"
after "rehabilitated";
(2) in subsection (b)—
(A) by striking "Rehabilitation programs" and inserting
"Preservation programs";
(B) in para^aph (3), by inserting "or replacement"
after "rehabilitation each place it appears;
(C) in paragraph (4), by striking "repair and rehabilitation" and inserting repair, rehabilitation, and
replacement";
(D) by redesignating paragraphs (2) through (6) (as
amended by this paragraph) as paragraphs (3) through
(7), respectively; and
(E) by inserting after paragraph (1) the following new
paragraph:
(2) be used to provide loans or grants, not to exceed
$15,000 per unit, to owners of single family housing to replace
existing nousing if repair or rehabilitation of the housing is
determined bv the Secretaiy not to be practicable and the
owner of the nousing is imable to afford a loan under section
502 for replacement housing;";
(3) in the first sentence of subsection (cXl)> by striking
"rehabilitation grant funds" and inserting "grant funds under
this section"; and
(4) in subsection (d)—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3841

(A) in paragraph (1), by striking 'Rehabilitation program" and inserting "preservation program";
(B) in paragraphs (3XA), (3XB), and (3XD), by striking
"repair and rehabiutation" eadi place it appears and inserting "repair, rehabilitation, and replacement";
(C) in paragraph (4), b^ inserting ", or replacement,"
after "repair and renabilitation"; and
(D) by adding at the end the following new paragraph:
"(5) A grantee may use housing preservation grant funds under
this section for replacement housing only aft«r providing documentation to the Secretary that—
"(A) the existing housing is in such poor condition that
rehabilitation is not economically feasible;
"(B) the owner of the housing lacks the income or repayment ability necessary to qualify for a loan under section 502;
and
"(C) the grantee will extend assistance to the owner of
the housing under terms that the owner can afford.".
SEC. 712. PRESERVATION.

(a) APPUCABILITY.—Section 502(c) of the Housing Act of 1949
(42 U.S.C. 1472(c)) is amended—
(1) in subparagraph (2), by striking "before December 21,
1979," and inserting "prior to the date of enactment of the
Depa^ment of Housing and Urban Development Reform Act
of 1989";
(2) in subparagraph (4XA), by striking "before December
21, 1979" ana inserting "prior to the date of enactment of
the Department of Housing and Urban Development Reform
Act of 1989";
(3) in sulmaragraph (5XF), by striking "before December
21, 1979" and inserting "prior to the date of enactment of
the Department of Housing and Urban Development Reform
Act of 1989"; and
(4) in subparagraph (SXC), by striking "before December
21, 1979" and inserting "prior to the date of enactment of
the Department of Housing and Urban Development Reform
Act of 1989".
(b) INCENTIVES.—Section 502(cX4XB) of the Housing Act of
1949 (42 U.S.C. 1472(cX4XB)) is amended by adding the following
new clause:
"(vi) In the case of a project that has received
rental assistance imder section 8 of the United States
Housing Act of 1937, permitting the owner to receive
rent in excess of the amount determined necessaiy
by the Secretary to defray the cost of long-term repair
or maintenance of such a project.".
(c) OFFICE OF RURAL HOUSING PRESERVATION.—Title V of the

Housing Act of 1949 (42 U.S.C. 1471 et seq.) is amended by inserting
after section 536 the following:
'*8EC, 837. OFFICE OF RURAL HOUSING PRESERVATION.
"(a) ESTABUSHMENT.—^There is established within the Farmers
Home Administration an Office of Rental Housing Preservation
(hereafter in this section referred to as the 'Office'). The Office
shall be headed by a Director designated by the Secretary of
Agriculture.
"(b) PURPOSES.—The purposes of the Office are:

42 USC 1490p-l.

106 STAT. 3842

Termination
date.
42 u s e 1490o.
42 u s e 1490o
note.

PUBLIC LAW 102-550—OCT. 28, 1992

"(1) to review and process applications under section 502(c)
and section 515(t) related to the preservation of rural rental
housing;
"(2) to provide technical or financial assistance to any other
projects needing such assistance;
"(3) to coordinate and direct all other activities related
to the preservation of rural housing; and
"(4) to monitor compliance of projects prepcdd or receiving
incentives \mder the Housing Act of 1949.".
SEC. 713. DISASTER ASSISTANCE.
Section 541(aXl) of the Housing Act of 1949 (42 U.S.C.
1490q(aXl)) is amended in the first sentence by striking "amounts
available under this title" and inserting "amounts made available
to the Secretary by an appropriations Act for such purpose".
SEC. 714. PROHIBITION ON TRANSFER OF RURAL HOUSING PROGRAMS.
Section 501 of the Housing Act of 1949 (42 U.S.C. 1471) is
amended by adding at the end the following new subsection:
"(j) PROGRAM TRANSFERS.—^Notwithstanding any other provision of law, the Secretary shall not transfer any program authorized
by this title to the Rural Development Administration.".
SEC. 715. SITE ACQUISITION AND DEVELOPMENT.
Section 524(a) of the Housing Act of 1949 (42 U.S.C. 1490d(a))
is amended—
(1) by inserting "(1) IN GENERAL.—" before T h e Secretary"
in the first sentence; and
(2) by adding at the end the following:
"(2) REVOLVING FUNDS.—^The Secretary may make grants
to nonprofit housing agencies to establish revolving loan fiinds
for the acquisition and preparation of building sites for lowincome housing. Any proceeds and repayments m)m such loans
shall be returned to the revolving loan fiind to be used for
purposes related to this section. Loan fiinds and interest payments shall be used solely for the acquisition of land; the
preparation of land for building sites; the payment of reimbursable legal and technical costs; and technical assistance and
administrative costs, not to exceed 10 percent of the fimd.".
SEC. 716. RECIPROCnY IN APPROVAL OF HOUSING SUBDIVISIONS
AMONG FEDERAL AGENCIES.
(a) EXTENSION OF AUTHORITY.—Section 535(b) of the Housing
Act of 1949 (42 U.S.C. 1490o(b)) is amended by striking the last
sentence and inserting the following new sentence: T h i s subsection
shall not apply after June 15,1993. .
(b) RETROACTIVITY.—Any administrative approval of any housing subdivision made afi«r the expiration of the 18-month period
beginning on the date of the enactment of the Department of
Housing and Urban Development Reform Act of 1989 and before
the date of the enactment of this Act is approved and shall be
considered to have been lawfiilly made, but only if otherwise made
in accordance with the provisions of section 535(b) of "^the Housing
Act of 1949.
(c) APPROVAL BY LOCAL, COUNTY, OR STATE AGENCIES.—Section

535 of the Housing Act of 1949 (42 U.S.C. 1490o) is amended
by adding at the end the following new subsection:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3843

"(d) For loans made under this title, the Secretary may accept
subdivisions that have been approved by local, county, or State
agencies.".

TITLE Vni—COMMUNITY
DEVELOPMENT
Subtitle A—Community Development
Block Grants
SEC. 801. COMMUNITY DEVELOPMENT AUTHORIZATIONS.
(a) COMMUNITY DEVELOPMENT BLOCK GRANTS.—Section 103

Appropriation
of the Housing and Community Development Act of 1974 (42 U.S.C. authorization.
5303) is amended by striking the second and third sentences and
inserting the following: "For purposes of assistance under section
106, there are authorized to be appropriated $4,000,000,000 for
fiscal year 1993 and $4,168,000,000 for fiscal year 1994.
(b) LIMITATION ON LOAN GUARANTEES.—The fifth sentence of
section 108(a) of the Housing and Community Development Act
of 1974 (42 U.S.C. 5308(a)) is amended to read as follows: "Notwithstanding any other provision of law and subject only to the absence
of qualified applicants or proposed activities and to the authority
provided in this section, to the extent approved or provided in
appropriation Acts, the Secretary shall enter into commitments
to guarantee notes and obligations under this section with an aggreate principal amount of $2,000,000,000 for fiscal year 1993 and
2,000,000,000 for fiscal year 1994.".

f

(c) SPECIAL PURPOSE GRANTS.—

(1) SET-ASIDE.—Section 107 of the Housing and Community
Development Act of 1974 (42 U.S.C. 5307) is amended by striking "SEC. 107. (a)" and all that follows through the end of
subsection (a) and inserting the following:
"SEC. 107. (a) SET-ASIDE.—

"(1) IN GENERAL.—For each fiscal year (except as otherwise
provided in this paragraph), of the total amount provided in
appropriation Acts imder section 103 for the fiscal year,
$60,000,000 shall be set aside for grants under subsection (b)
for such year for the following purposes:
"(A) $7,000,000 shall be available for grants under
subsection (b)(1);
"(B) $6,500,000 shall be available for grants under
subsection (bX3);
"(C) $6,000,000 shall be available for grants under
subsection (bX5);
"(D) $6,000,000 shall be available in fiscal year 1993
for grants under subsection (bX7);
"(E) $3,000,000 shall be available for grants under
subsection (c);
"(F) such sums as may be necessary shall be available
for grants under paragraphs (2), (4), and (6) of subsection (b);
"(G) $2,000,000 shall be available in fiscal year 1993
for a grant to the City of Bridgeport, Connecticut, subject
to the approval of sufficient amounts in an appropriation
Act and to binding commitments made by the City of

106 STAT. 3844

42 use 5307
note.

PUBLIC LAW 102-550—OCT. 28, 1992
Bridgeport and the State of Connecticut that the city and
State, respectively, will supplement such amount with
$2,000,000 of additional funds;
"(H) $15,000,000 shall be available for grants under
the Removal of Regulatory Barriers to A£fordable Housing
Act of 1992; and
"(I) $7,500,000 shall be available to carry out the
Community Outreach Partnership Act of 1992.
"(2) TREATMENT OF GRANTS.—Any grants made imder this
section shall be in addition to any other ^ants that may
be made under this title to the same entities for the same
purposes.".
(2) OTHER PURPOSES.—Section 107(b) of the Housing and
Community Development Act of 1974 (42 U.S.C. 5307(b)) is
amended—
(A) in paragraph (3), by striking "and" at the end;
(B) in paragraph (4), by striking the period at the
end and inserting a semicolon; and
(C) by adding at the end the following:
"(5) to States and units of general local government and
* institutions of higher education having a demonstrated capacity
to carry out eligible activities under this title, except that
the Secretary ma^ make a grant under tiiis paragraph only
to a State or unit of general local government that jointly,
with an institution of higher education, has prepared and
submitted to the Secretanr an application for such grant, as
the Secretary shall by regulation require;
"(6) to units of general local government in nonentitlement
areas for planning commimity a4justment8 and economic diversification activities, which may include any eligible activities
under section 105, required—
"(A) by the proposed or actual establishment, realignment, or closure of a military installation,
"(B) by the cancellation or termination of a Department
of Defense contract or the failure to proceed with an
approved msoor weapon system program, or
"(C) by a publicly announced planned major reduction
in Department of Defense spending that would directly
and adversely affect a unit of general local government
and will result in the loss of 1,000 or more full-time Department of Defense and contractor employee positions over
a 5-year period in the imit of general local government
and the surrounding area, or
if the Secretary (in consultation with the Secretary of Defense)
determines that an action described in subparagraph (A), (B),
or (C), is likely to have a direct and significant adverse consequence on the unit of general local government; and
''(7) for the purposes of rebuilding and revitalizing distressed areas of the Los Angeles metropolitan area.".
(3) REGULATIONS.—Not later than the expiration of the
60-day period beginning on the date of the enactment of this
Act, the Secretary of Housing and Urban Development shall
issue proposed regulations to carry out section 107(bX6) of
the Housing and Community Development Act of 1974, as
added by subsection (cX2) of this section. The Secretary shall
issue final relations to carry out section 107(bX6) not later
than the expiration of the 120-day period beginning on the

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3845

date of the enactment of this Act and after notice and opportunity for public comment pursuant to the provisions of section
553 of title 5, United States Code (notwithstanding subsections
(aX2), (bXB), and (dX3) of such section). SuchfinsQregulations
shall take effect 30 days after issuance.
(4) CONFORMING AMENDMENT.—Section 107(c) of the Housing and Conununity Development Act of 1974 (42 U.S.C.
5307(c)) is amended by striking ' » the extent" and all tiiat
M
follows up to "grants to institutions" and inserting '^ake".
(d) GRANT ACTIVITIES.—^The special purpose grant of the City
of Dubuque, Iowa, under Public Law 102-139 may be used for
land acquisition, new construction, relocation assistance payments,
and rehabilitation for housing of low- and moderate-income mmilies.
SEC. 802. UNITS OF GENERAL LOCAL GOVERNMENT.

(a) DEFINITION.—Section 102(aXl) of the Housing and Community Development Act of 1974 (42 U.S.C. 5302(aXl)) is amended
by striking recognized by the Secretary and inserting the following: "that, except as provided in section 106(dX4), is recognized
by the Secretary*.
(b) GRANTS TO NONENTTTLEMENT AREAS.—Section 106(d) of the
Housing £ind Community Development Act of 1974 (42 U.S.C.
5306(d)) is amended by inserting after paragraph (3) the following
new paragraph:
(4) Any combination of units of general local governments
may not be required to obtain recognition by the Secretary pursuant
to section 102(aXl) to be treated as a single unit of general local
government for purposes of this subsection.".
SEC. 803. U R B A N COUNTIES.

Section 102(aX6XD) of the Housing and Commimity Development Act of 1974 (42 U.S.C. 5302(aX6XD)) is amended—
(1) in clause (iii), by striking "or" at the end;
(2) in clause (iv), by striking the period at the end and
inserting "; or"; and
(3) by adding at the end the following new clause:
(vXD has a population of 175,000 or more (including
the population of metropolitan cities therein), (II) before
January 1, 1975, was designated by the Secretary of
Defense pursuant to section 608 of the Military Construction Authorization Act, 1975 (Public Law 93-552; 88 Stat.
1763), as a Trident Defense Impact Area, and (III) has
located therein not less than 1 unit of general local government that was classified as a metropolitan city and (a)
for which coimty each such unit of general local government
therein has relinquished its classification as a metropolitan
city imder the 6th sentence of paragraph (4), or (b) that
has entered into cooperative agreements with each metropolitan city therein to undertake or to assist in the imdertaking of essential community development and housing
assistance activities.".
SEC. 804. R E T E N T I O N OF PROGRAM INCOME.

The first sentence of section 104(j) of the Housing and Community Development Act of 1974 (42 U.S.C. 5304(j)) is amended—
(1) oy striking "while the unit of general local government
is participating in a community development program under
this title"; and

106 STAT. 3846

•

PUBLIC LAW 102-550—OCT. 28, 1992

(2) by inserting before the period at the end the following:
"; except that the Secretary may, by regulation, exclude from
consideration as program income any amounts determined to
be so small that compliance with this subsection creates an
unreasonable administrative burden on the imit of general
local government".
SEC. 805. ECONOMIC DEVELOPMENT.
(b) Section 105 of the Housing and Community Development
Act of 1974 (42 U.S.C. 5305) is amended by adding at the end
the following new subsection:
"(d) TRAINING PROGRAM.—^The Secretary shall implement, using
funds recaptured pursuant to section 119(o), an on-going education
and training program for officers and employees of the Department,
especially of^cers and employees of area and other field offices
of the Department, who are responsible for monitoring and administering activities pursuant to paragraphs (14), (15), and (17) of
subsection (a) for the purpose of ensuring that (A) such personnel
possess a thorough understanding of such activities; and (B) regulations and guidelines are implemented in a consistent fashion.".
SEC. 806. EVALUATION, SELECTION, AND REVIEW OF ECONOMIC
DEVELOPMENT PROJECTS.
(a) GUIDELINES.—Section 105 of the Housing and Community
Development Act of 1974 (42 U.S.C. 5305), as amended by section
805, is amended by adding at the end the following new subsection:
"(e)

Regulations.

GUIDELINES FOR EVALUATING AND SELECTING ECONOMIC

DEVELOPMENT PROJECTS.—
"(1) ESTABLISHMENT.—The Secretary shall establish, by
regulation, guidelines to assist grant recipients under this title
to evaluate and select activities described in section 105(a)
(14), (15), and (17) for assistance with grant amounts. The
Secretary shall not base a determination of eligibility of the
use of funds under this title for such assistance solely on
the basis that the recipient fails to achieve one or more of
the guidelines' objectives as stated in paragraph (2).
"(2)

PROJECT COSTS AND FINANCIAL REQUIREMENTS.—The

guidelines established under this subsection shall include the
following objectives:
"(A) The project costs of such activities are reasonable.
"(B) To the extent practicable, reasonable financial support has been committed for such activities from non-Federal sources prior to disbursement of Federal funds.
"(C) To the extent practicable, any grant amoimts to
be provided for such activities do not substantially reduce
the amount of non-Federal financial support for the
activity.
"(D) Such activities are financially feasible.
"(E) To the extent practicable, such activities provide
not more than a reasonable return on investment to the
owner.
\
«^p^ rp^ ^YiQ extent practicable, grant amounts used
for the costs of such activities are disbursed on a pro
rata basis with amounts from other sources.
"(3) PUBLIC BENEFIT.—The guidelines established under
this subsection shall provide that the public benefit provided
by the activity is appropriate relative to the amount of assistance provided with grant amounts imder this title.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3847

(b) ASSISTANCE TO FOR-PROFIT ENTITIES.—Section 105 of the

Housing and Community Development Act of 1974 (42 U.S.C. 5305),
as amended by subsection (a), is amended by inserting at the
end the following new subsection:
"(f) ASSISTANCE TO FOR-PROFIT ENTITIES.—In any case in which
an activity described in paragraph (17) of subsection (a) is provided
assistance such assistance shall not be Umited to activities for
which no other forms of assistance are available or could not be
accomplished but for that assistance.".
(c) GAO STUDY.—The Comptroller General of the United States
shall conduct a study of the use of grant amounts under title
I of the Housing and Community Development Act of 1974 for
activities described in paragraphs (14), (15), and (17) of section
105(a) of such Act. The study snail evaluate whether the activities
for which such amoimts are being used under such paragraphs
further the goals and objectives of such program, as established
in section 101 of such Act. The Comptroller General shall submit
a report to the Congress regarding the findings of the study not
later than the expiration of the 18-month period beginning on
the date of the enactment of this Act. The report shall include
recommendations of—
(1) any administrative or legislative actions that may be
taken to ensure that such grant amounts are properly and
efficiently used for economic development activities; and
(2) criteria by which to evaluate the effectiveness of activities assisted under paragraphs (14), (15), and (17) of such
section 105(a).
(d) ENHANCING JOB QUALITY.—Not later than 1 year after
the date of enactment of this Act, the Comptroller Greneral shall
submit to the Congress a report on the types and quality of jobs
created or retained through assistance provided pursuant to title
I of the Housing and Community Development Act of 1974 and
the extent to which projects and activities assisted under that
title enhance the upward mobility and future earning capacitv
of low- and moderate-income persons who are benefited by sucn
projects and activities.
(e) REBUILDING DISTRESSED NEIGHBORHOODS.—Section 105(c)
of the Housing and Community Development Act of 1974 (42 U.S.C.
5305(c)) is amended by adding at the end the following new
paragraph:
(4) For the purposes of subsection (cXlXC)—
"(A) if an employee resides in, or the assisted activity
through which he or she is employed, is located in a census
tract that meets the Federal enterprise zone eligibility criteria,
the employee shall be presumed to be a person of low- or
moderate-income; or
"(B) if an employee resides in a census tract where not
less than 70 percent of the residents have incomes at or below
80 percent of the area median, the employee shall be presimied
to be a person of low or moderate income. .
SEC. 807. EUGIBLE ACTIYITIES.
(a) ADDITIONAL ELIGIBLE ACTIVITIES.—Section

105(a) of the
Housing and Commimity Development Act of 1974 (42 U.S.C.
5305(a)) is amended—
(1) in paragraph (8), by inserting before the semicolon
at the end the following: ", and except that of any amoimt

42 u s e 5305
note.

Reports

Reports.
42 u s e 5305
note.

106 STAT. 3848

~^
~

PUBLIC LAW 102-550—OCT. 28, 1992
of assistance under this title (including program income) in
each of fiscal years 1993 through 1997 to the City of Los
Angeles and County of Los Angeles, each such imit of general
government may use not more than 25 percent in each such
fiscal year for activities under this paragraph";
(2) in paragraph (19), by striking "and" at the end;
(3) by redesignating paragraph (20) as paragraph (25);
and
(4) by inserting after paragraph (19) the following new
paragraphs:
"(20) provision of technical assistance to public or nonprofit
entities to increase the capacity of such entities to carry out
eligible neighborhood revitalization or economic development
activities, which assistance shall not be considered a planning
cost as defined in paragraph (12) or administrative cost as
defined in paragraph (13);
"(21) housing services, such as housing counseling, energy
auditing, preparation of work specifications, loan processing,
inspections, tenant selection, management of tenant-based
rental assistance, and other services related to assisting owners,
tenants, contractors, and other entities, participating or seeking
to participate in housing activities authorized under this section, or under title II of the Cranston-Gonzalez National Affordable Housing Act, except that activities under this paragraph
shall be subject to any limitation on administrative expenses
imposed by any law;
"(22) provision of assistance by recipients under this title
to institutions of higher education having a demonstrated
capacity to carry out eligible activities under this subsection
for carrying out such activities;
"(23) provision of assistance to public and private organizations, agencies, and other entities (including nonprofit and forprofit entities) to enable such entities to facilitate economic
development by—
"(A) providing credit (including providing direct loans
and loan guarantees, establishing revolving loan funds,
and facilitating peer lending programs) for the establishment, stabilization, and expansion of microenterprises;
"(B) providing technical assistance, advice, and business support services (including assistance, advice, and
support relating to developing business plans, securing
funding, conducting marketing, and otherwise engaging in
microenterprise activities) to owners of microenterprises
and persons developing microenterprises; and
"(C) providing general support (such as peer support
programs and counseling) to owners of microenterprises
and persons developing microenterprises;
"(24) activities necessary to make essential repairs and
to pay operating expenses necessary to maintain the habitability of housing units acquired through tax foreclosure
proceedings in order to prevent abandonment and deterioration
of such housing in primarily low- and moderate-income
neighborhoods; and".
(b) DIRECT HOMEOWNERSHIP ASSISTANCE.—Section 907(bX2) of

the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
5305 note) is amended—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3849

(1) by striking "October 1, 1992" and inserting "October
1,1994";
(2) by striking "October 1, 1993" and inserting "October
1,1995"; and
(3) by striking "(ISr, "(19)", and '•(20r and inserting "(23)",
"(24)", and "(25)", respectively.
(C) MICROENTERPRISE AND SMALL BUSINESS DEVELOPMENT
INITIATIVE.—

(1) IN GENERAL.—Section 105 of the Housing and Community Development Act of 1974 (42 U.S.C. 5305), as amended
by section 806, is further amended by adding at the end the
following new subsection:
"(g)

MiCROENTERPRISE

AND

SMALL

BUSINESS

PROGRAM

REQUIREMENTS.—In developing program requirements and providing assistance pursuant to paragraph (17) of subsection (a) to a
microenterprise or small business, the Secretary shall—
"(1) take into account the special needs and Umitations
arising from the size of the entity; and
"(2) not consider training, technical assistance, or other
support services costs provided to small businesses or
microenterprises or to grantees and subgrantees to develop
the capacity to pro\ide such assistance, as a planning cost
pursuant to section 105(aX12) or £ui administrative cost pursuant to section 105(aX13).".
(2) DEFINITIONS.—Section 102(a) of the Housing and
Commimity Development Act of 1974 (42 U.S.C. 5302(a)) is
amended bv adding at the end the following new paragraphs:
"(22) Ine term 'microenterprise' means a commercial enterprise that has 5 or fewer employees, 1 or more of whom owns
the enterprise.
"(23) The term 'small business' means a business that
meets the criteria set forth in section 3(a) of the Small Business
Act.".
(3) SENSE OF THE CONGRESS.—It is the sense of the Congress that each grantee under title I of the Housing and
Community Development Act of 1974 should reserve 1 percent
of any grant amounU the grantee receives in each fiscal year
for the purpose of providing assistance under section 105(aX23)
of such Act to facilitate economic development through commerci&l ixiiciroGii^GirDrisGS
(4) REPORT.—Not later than 18 months after the date of 42 use 5305
enactment of this Act, the Secretary shall submit to the Con- "''^^gress a report on the effectiveness of assistance provided
through title I of the Housing and Community Development
Act of 1974 in promoting development of microenterprises,
including a review of any statutory or regulatory provision
that impedes the development of microenterprises.
(d) LOANS OF CDBG FUNDS.—Section 105(aX14) of the Housing
and Commimity Development Act of 1974 (42 U.S.C. 5305(aX14))
is amended by inserting before "activities" the following: "provision
of assistance including loans (both interim and long-term) and
grants for".
(e) CDBG CODE ENFORCEMENT.—Section 105(aX3) of the Housing and Community Development Act of 1974 is amended by striking "improvements and" and inserting "or private improvements

106 STAT. 3850

PUBLIC L A W 102-550—OCT. 28, 1992
(f) NEIGHBORHOOD-BASED NONPROFIT ORGANIZATIONS.—Section

105(aX15) of the Housing and Community Development Act of
1974 (42 U.S.C. 5305(aX15)) is amended by inserting after "corporations," the following: "nonprofit organizations serving the development needs of the commimities in nonentitlement areas,".
SEC. 808. REFERENCE TO FAIR HOUSING ACT.

Sections 104(bX2), 106(dX5XB), and 107(eXl) of the Housing
and Community Development Act of 1974 (42 U.S.C. 5304(bX2),
5306(dX5XB), and 5307(eXl)) are each amended by striking "Public
Law 88-352 and Public Law 90-284" and inserting "the Civil Rights
Act of 1964 and the Fair Housing Act".
SEC. 809. ELIGIBILITY OF ENTERPRISE ZONES.

Section 105(aX13) of the Housing and Community Development
Act of 1974 is amended by inserting immediately after "(13)" the
following: "payment of reasonable administrative costs related to
establishing and administering federally approved enterprise zones
and".
SEC. 810. ASSISTANCE FOR COLONIAS.

(a) ELIGIBLE ACTIVITIES.—Section 916 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 5306 note) is amended—
(1) by adding at uie end of subsection (b) the following
new paragraph:
"(3) OTHER IMPROVEMENTS.—Other activities eligible under

section 105 of the Housing and Community Development Act
of 1974 designed to meet the needs of residents of colonias.";
and
(2) in subsection (f), by striking "and 1993" and inserting
"1993, and 1994".
(b) DEFINITION OF COLONIA.—Section 916(eXl) of the Cranston-

Gonzalez National Affordable Housing Act (42 U.S.C. 5306 note)
is amended—
(1) by striking subparagraph (C);
(2) by redesignating subparagraph (D) as subparagraph
(C); and
(3) by striking subparagraph (E) and inserting the following
new subparagraph:
"(D) was in existence as a colonia before the date
of the enactment of the Cranston-Gonzalez National
Affordable Housing Act.".
SEC. 81L STATE SET-ASIDE FOR TECHNICAL ASSISTANCE.

'

Section 106(d) of the Housing and Community Development
Act of 1974 (42 U.S.C. 5306(d)) is amended by inserting after
paragraph (4), as added by section 802, the following:
"(5) From the amounts received under paragraph (1) for distribution in nonentitlement areas, the State may deduct an amount,
not to exceed 1 percent of the amount so received, to provide
technical assistance to local governments and nonprofit program
recipients.".
SEC. 812. COMMUNITY DEVELOPMENT PLANS AND REPORTS.

(a) I N GENERAL,—Subsection (1) of section 104 of the Housing
and Community Development Act of 1974, as added by section
922 of the Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 5304(1)), is amended to read as follows:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3851

"(m) COMMUNITY DEVBLOPMENT PLANS.—

"(1) IN GENERAL.—^Prior to the receipt in any fiscal year Regulations.
of a grantfi:t>mthe Secretary under subsection (b), (aXl)>
or (d)(2XB) of section 106, eacn recii>ient shall have prepared
and submitted in accordance with tms subsection ana in such
standardized form as the Secretary shall, by regulation, prescribe a description of its priority nonhousing community development needs eligible for assistance under this title.
"(2) LOCAL GOVERNMENTS.—^In the case of a recipient that
is a unit of general local government—
"(A) prior to the submission required by paragraph
(1), the recipient shall, to the extent practicable, notify
ac^acent units of general local government and soUcit the
views of citizens on priority nomiousing community development needs; and
"(B) the description required under paragraph (1) shall Regulations.
be submitted to the Secretary, the State, and any other
unit of general local government within wluch the recipient
is located, in such standardized form as the Secretary
shall, by regulation, prescribe.
"(3) STATES.—^In the case of a recipient that is a State,
the description required by paragraph (1)—
"(A) shall include only &e needs within the Stete that
affect more than one unit of general local government
and involve activiities typically funded by such Stetes under
this title; and
"(B) shall be submitted to the Secretary in such stand- Regulations.
ard form as the Secretary, by regulation, shall prescribe.
"(4) EFFECT OF SUBMISSION.—A siibmission under this subsection shall not be binding with respect to the use or distribution of amounts received under section 106.".
(b) CONFORMING AMENDMENTS.—Section 104(bX4) of the Housing and Community Development Act of 1974 (42 U.S.C. 5304(bX4))
is amended—
(1) by inserting "pursuant to subsection (m)" before the
first comma; and
(2) by striking "and housing".
SEC. 813. DELAY USE OF 1990 CENSUS HOUSING DATA TO EXAMINE
EFFECT ON TARGETING FOR CDBG FORMULA.

Notwithstanding any other provision of law, for fiscal year
1993, no date derived from the 1990 Decennial Census, except
those relating to population and poverty, shall be taken into account
for purposes of the allocation of amounte under section 106 of
the Housing and Community Development Act of 1974.

Subtitle B—Other Community
Development Programs
SEC. 831. NEIGHBORHOOD REINVESTMENT CORPORATION.
(a) AUTHORIZATION OF APPROPRIATIONS.—The first sentence

of
section 608(aXl) of Uie Neighborhood Reinvestment Corporation
Act (42 U.S.C. 8107(a)) is amended to read as follows: There
are authorized to be appropriated to the corporation to carry out
this title $29,476,000 forfiscalyear 1993 and $30,713,992 for fiscal
year 1994.".

106 STAT. 3852

PUBLIC LAW 102-550—OCT. 28, 1992

(b) EXPANDED PROGRAMS.—^The matter preceding subp£u*agraph
(A) of section 608(aX2) of the Neighborhood Reinvestment Corporation Act (42 U.S.C. 8107(aX2)) is amended by striking "each of
the fiscal years 1991 and 1992" and inserting "any fiscal year".
SEC. 832. NEIGHBORHOOD DEVELOPMENT PROGRAM.
42 u s e 5318a.

Appropriation
authorization.

42 u s e 5318a.

(a) AUTHORIZATION.—Section 123(g) of the Housing and UrbanRural Recovery Act of 1983 (42 U.S.C. 5318 note) is amended
to read as follows:
"(g) AUTHORIZATION.—Of the amounts made available for assistance imder section 103 of the Housing and Community Development
Act of 1974, $1,000,000 for fiscal year 1993 (in addition to other
amounts provided for such fiscal year) and $3,000,000 for fiscal
year 1994 shall be available to cany out this section.".
(b) PERMANENT PROGRAM.—^tion 123 of the Housing and
Urban-Rural Recovery Act of 1983 (42 U.S.C. 5318 note) is
amended—
(1) by striking the section heading and inserting the following new heading:
"JOHN HEINZ NEIGHBORHOOD DEVELOPMENT PROGRAM";

Reports.

John Heinz
Neighborhood
Development
Act.
42 u s e 5318a.

(2) by striking "demonstration program" each place it
appears and inserting "program";
(3) in subsection (bXD, by striking "determine the feasibility of supporting" and inserting "suppjort";
(4) in subsection (eX3), by inserting afl^r "year" the following: ", except that, if appropriations for this section exceed
$3,000,000, the Secretary may pay not more than $75,000 to
any participating neighborhood development organization";
(5) in subsection TeX6)—
(A) in subparagraph (C), by inserting "and" after the
semicolon at the end;
(B) by striking subparagraph (D);
(C) by redesignating subparagraph (E) as subpara*
graph (D); and
(D) in subparagraph (D), as so redesignated, by striking
"demonstration" and inserting "program";
(6) by striking subsection (i; and inserting the following
new subsection:
"(f) The Secretary shall submit a report to the Congress, not
later than 3 months after the end of each fiscal year in which
payments are made under this section, regarding the program under
this section. The report shall contain a summary of the activities
carried out under this section during such fiscal year and any
findings, conclusions, and recommendations for legislation regarding
the program."; and
(7) by adding at the end the following new subsection:
"(h) SHORT TITLE.—^This section may be cited as the 'John
Heinz Neighborhood Development Act'.".
(c) COMPLIANCE WITH CHAS AND COMMUNITY DEVELOPMENT

PLANS.—Section 123(eX5XA) of the Housing and Urban-Rural
Recovery Act of 1983 (42 U.S.C. 5318 note) is amended by striking
"housing and community development plans of such unit" and
inserting "comprehensive housing affordability strategy of such unit
approved under section 105 of the Cranston-Gronzalez National
Affordable Housing Act or the statement of community development
activities and community development plans of the unit submitted

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3853

under section 104(m) of the Housing and Community Development
Act of 1974".
(d) EuGiBLE NEIGHBORHOOD DEVELOPMENT ORGANIZATION.—
Section 123(aX2) of the Housing and Urban-Rural Recovery Act
of 1983 (42 U.S.C. 5318 note) is amended—
42 use 53i8a.
(1) in subparagraph (A), by inserting "(i)" after "(A)";
(2) in siibparagraph (E), by stri^ng the period at the
end and inserting "; or";
(3) by redesignating subparagraphs (B) through (E) as
clauses (ii) through (v), respectively; and
(4) l^ adding at the end the following new subparagraph:
(B) any facilitv that provides small entrepreneurial
business with afibroable shared support services and business development services and meets the requirements of
subparcigraph (A).".
(e) DEFlNmoNS.—Section 123(a) of the Housing and UrbanRural Recovery Act of 1983 (42 U.S.C. 5318 note) is amended— 42 use 53i8a.
(1) by striking subparagraph (2XAXiv) (as so redesignated
by subsection (d) of this section) and inserting the following
new clause:
"(iv) an organization that operates within an area
that^
"(I) meets the requirements for Federal assistance
under section 119 of the Housing and Community
Development Act of 1974;
"(II) is designated as an enterprise zone under
Federal law;
"(III) is designated as an enterprise zone under
State law and recognized by the Secretary for purposes
of this section as a State enterprise zone; or
"(IV) is a qualified distressed community within
the meaning of section 233(bXl) of the Bank Enterprise
Act of 1991; and";
(2) by redesignating paragraph (3) as paragraph (4); and
(3) by inserting before paragraph (4) (as so redesignated)
the following new paragraph:
"(3) The term 'neighborhood development funding organization' means—
"(A) a depository institution the accounts of which are
insured pursuant to the Federal Deposit Insurance Act
or the Federal Credit Union Act, ana any subsid^a!^:ia8 ^
^
^
such term is defined in section 3(w) of the Federal D^po^t
Insurance Act) thereof;
"(B) a depository institution holding company and any
subsidiarv thereof (as such term is defined in section 3(w)
of the Federal Deposit Insurance Act); or
"(C) a company at least 75 percent of the common
stock of which is owned by one or more insured depositonr
institutions or depository institution holding companies. .
(f) COORDINATION WITH COMMUNITY DEVELOPMENT FUNDING

ORGANIZATIONS.—Section 123 of the Housing and Urban-Rural
Recovery Act of 1983 (42 U.S.C. 5318 note) is amended—
42 use 53i8a.
(1) in subsection (bXD, by inserting ", and from neighborhood development fiinding organizations," after "neighborhoods";
(2) in subsection (bX3)—
(A) in subparagraph (B), by striking "and" at the end;

106 STAT. 3854

42 use 5318a.

PUBLIC LAW 102-550—OCT. 28, 1992

(B) in subpara^aph (C), by striking the period and
inserting the loUowing: ", especially in cooperation with
a neighborhood development ninding organization, except
that an eligible neighborhood devdopment organization
shall be deemed to have the full benefit of the cooperation
of a neighborhood development funding organization if the
eligible neighborhood development organization—
"(i) is located in an area described in subsection
(aX2XAXiv) that does not contain a neighborhood development funding organization; or
"(ii) demonstrates to the satisfaction of the Secretary
that it has been unable to obtain the cooperation of any
neighborhood development funding organization in sum
area despite having made a good faith effort to o b t ^
such cooperation; and"; and
(C) by adding at the end the following new subparagraph:
"(D) specify a strategy for increasing the capacity of the
orgtmization.";
(3) in subsection (cX3), by inserting before the semicolon
the foUowing: "and by the extent of participation in the proposed
activities by a neighborhood development funding organization
that has a branch or office in the neighborhood, except tibat
an eligible neighborhood development organization shall be
deemed to have the full benent of the participation of a
neighborhood development funding organization if^the eligible
neighborhood development organization—
"(A) is located in an neighborhood that does not contain
a branch or ofiKce of a nei^borhood development fimding
organization; or
"(B) demonstrates to the satisfaction of the Secretary
that it has been imable to obtain the participation of any
neighborhood development funding organization that has
a branch or office in the neighborhood despite having made
a good faith effort to obtain such participation"; and
(4) in subsection (eXD, by inserting ", and from neighborhood development funding organizations," after 'Neighborhood",
(g) ADMINISTRATIVE CHANGES.—Section 123 of the Housing and
Urban-Rural Recovery Act of 1983 (42 U.S.C. 5318 note) is
amended—
(1) in subsection (aX2XAXiii), as so redesignated by subsection (d) of this section, by striking'ihree years" and inserting
"one year"; and
(2) in subsection (bX2), by striking "Not more than 30
per centum" and inserting 'Tor fiscal year 1993 and thereafter,
not more than 50 percent.
SEC. 833. STUDY REGARDING HOUSING TECHNOLOGY RESEABiCH.

(a) STUDY.—The Secretary of Housingand Urban Development,
through the Assistant Secretary for Policy Development and
Research, shall conduct a study of—
(1) the extent of Federal, other public, and private basic
research in the United States in housing technologv, including
design and construction techniques and methoddiogy, smart
building technology, area and neighborhood planning, and other
areas relating to the preservation and production of affordable
housing andfivablecommunities;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3855

(2) the extent of competitiveness of the United States in
the field of basic housing technology research in comparison
with other countries that are substantially involved in trade
with the United States, taking into consideration the balance
of trade, the degree of government support of private research
activities, and the degree of fragmentation of research; and
(3) the types of research projects regarding basic housing
technology conducted by such other countries, the results of
such research, and the extent of success in applying and
marketing such results.
(b) REPORT.—^The Secretary of Housing and Urban Development
shall submit a report to the Congress describing the results of
the study conducted under this section not later than September
30,1993.
SEC. 834. DESIGNATION OF ENTERPRISE ZONES.

(a) IN GENERAL.—Section 701 of the Housing and Commimity
Development Act of 1987 (42 U.S.C. 11501) is amended—
(1) in subsection (aX4XB), by striking "the effective date
of the regulations described in subparagraph (A) occurs" and
inserting "the date of the enactment of the Housing and
Commimity Development Act of 1992 occurs"; and
(2) in subsection (cX3XB), by striking "this Act" and inserting "the Housing and Community Development Act of 1992".
(b) REPORT.—Section 702 of the Housing and Community Development Act of 1987 (42 U.S.C. 11502) is amended bv inserting
"pursuant to the amendments made by section 834 of the Housing
and Community Development Act of 1992" before the first comma.

Subtitle C—^Miscellaneous Programs
SEC. 851. COMMUNITY OUTREACH ACT.
(a) SHORT TITLE.—^This section may be cited as the "Community

Community

Partnership Act
Outreach Partnership Act of 1992".
of 1992.
(b) PURPOSE.—^The Secretary shall carry out, in accordance ^^^ ^^^'^
with this section, a 5-year demonstration program to determine note.
the feasibility of facilitating partnerships between institutions of
higher education and communities to solve urban problems through
research, outreach, and the exchange of information.
(c) GRANT PROGRAM.—-

(1) IN GENERAL.—^The Secretary is authorized to make
grants to public and private nonprofit institutions of higher
education to assist in establishing or canying out research
and outreach activities addressing uie problems of urban areas.
(2) USE OF GRAN:rs.—Grants imder this Act shall be used
to establish and operate Community Outreach Partnership Centers (hereafter in this section referred to as "Centers") which
shall—
(A) conduct competent and qualified research and
investigations on theoretical or practical problems in large
and small cities; and
(B) facilitate! partnerships and outreach activities
between institutions of higher education, local communities, and local governments to address urban problems.
(3) SPECIFIC PROBLEMS.—^Research and outreach activities
assisted under this Act shall focus on problems associated with

106 STAT. 3856

PUBLIC LAW 102-550—OCT. 28, 1992

housing, economic development, neighborhood revitalization,
infrastructure, health care, job training, education, crime
prevention, planning, commimity organizing, and other areas
deemed appropriate by the Secretary.
(d) APPLICATION.—^Any public or private nonprofit institution
of higher education may submit an application for a grant imder
this section in such form and containing such information as the
Secretary may require by regulation.
(e) SELECTION CRITERIA.—

(1) IN GENERAL.—The Secretary shall select recipients of
grants under this section on the basis of the following criteria:
(A) The demonstrated research and outreach resources
available to the applicant for carrying out the purposes
of this section.
(B) The capability of the applicant to provide leadership
in solving commimity problems and in making national
contributions to solving long-term and immediate urban
problems.
(C) The demonstrated commitment of the applicant
to supporting urban research and outreach programs by
providing matching contributions for any Federal assistance received.
(D) The demonstrated ability of the applicant to
disseminate results of research and successful strategies
developed through outreach activities to other Centers and
communities served through the demonstration program.
(E) The projects and activities that the applicant proposes to carry out under the grant.
(F) The effectiveness of the applicant's strategy to provide outreach activities to communities.
(G) The extent of need in the communities to be served
by the Centers.
(H) Other criteria deemed appropriate by the Secretary.
(2) RIEFERENCE.—^The Secretary shall give preference to
institutions of higher education that imdertake research and
outreach activities by bringing together knowledge and expertise in the various social science and technical disciplines that
relate to urban problems.
(f) FEDERAL SHARES.—The Federal share of a grant under this
section shall not be more than—
(1) 50 percent of the cost of establishing and operating
a Center's research activities; and
(2) 75 percent of the cost of establishing and operating
a Center's outreach activities.
(g) NON-FEDERAL SHARES.—The non-Federal share of a grant
may include cash, or the value of non-cash contributions, equipment,
or other in-kind contributions deemed appropriate by the Secretary.
(h) RESPONSIBILITIES.—^A Center established under this section
shall—
(1) employ the research and outreach resources of its
sponsoring institution of higher education to solve specific
urban problems identified by communities served by the Cfenter;
(2) establish outreach activities in areas identified in the
grant application as the communities to be served;
(3) establish a community advisory committee comprised
of representatives of local institutions and residents of the

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3857

communities to be served to assist in identifying local needs
and advise on the development and implementation of strategies to address those issues;
(4) coordinate outreadi activities in communities to be
served by the Center;
(5) facilitate public service projects in the communities
served by the Center;
(6) act as a clearinghouse for the dissemination of
information;
(7) develop instructional programs, convene conferences,
and provide training for local community leaders, when appropriate; and
(8) exchange information with other Centers,
(i) NATIONAL ADVISORY COUNCIL.—

(1) ESTABLISHMENT.-The Secretary shall establish a
national advisory council (hereafter in this section referred
to as the "coimcil ) to—
(A) disseminate the results of research and outreach
activities carried out under this section;
(B) act as a clearinghouse between grant recipients
and other institutions of higher education; and
(C) review and evaluate programs carried out by grant
recipients.
(2) MEMBERS.—^The council shall be composed of 12 members to be appointed by the Secretary as follows—
(A) 3 representatives of State and local governments;
(B) 3 representatives of institutions of higher education
that receive granto under this section;
(C) 3 individuals or representatives of organizations
that possess significant expertise in urban issues; and
(D) 3 representatives from community advisory
committees creaU^d piirsuant to this section.
(3) VACANCIES.—^A vacancy in the membership of the council shall be filled in the manner in which the original appointment was made.
(4) COMPENSATION.—^Members of the coimcil shall serve
without pay.
(5) CHAIRMAN.—^The coimcil shall elect a member to serve
as chairperson of the (X)uncil.
(6) MEETINGS.—^llie council shall meet at least biannually
and at such other times as the chairman may designate.
(j) NATIONAL CLEARINGHOUSE.—The Secretary shall estabhsh Establishment.
a national clearinghouse to disseminate information resulting from
the research and successful outreach activities developed through
the Centers to grant recipients and other interested institutions
of higher education.
(k) AUTHORIZATIONS.—^The sums set aside by section 107 of
the Housing and Community Development Act of 1974 for the
purpose of this section shall be available—
(1) to enable Centers to carry out research and outreach
activities;
(2) to establish and operate the national clearinghouse
to be established under subsection (j).
(1) REPORTING.—

(1) IN GENERAL.—^The Secretary of Housing and Urban
Development shall submit an annual report to the Committee
on Banking, Housing, and Urban Affairs of the Senate and

106 STAT. 3858

PUBLIC LAW 102-550—OCT. 28, 1992
the Committee on Banking, Finance and Urban Affairs of the
House of Representatives.
(2) CONTENTS.—^The report under paragraph (1) shall contain a siunmary of the activities carried out under this section
during the preceding fiscal year, and findings and conclusions
drawn from such activities.

42 u s e 5304
note.

SEC. 852. COMPUTERIZED DATABASE OF COMMUNTIY DEVELOPMENT
NEEDS.
(a) ESTABUSHMENT OF DEMONSTRATION PROGRAM.—Not later

than the expiration of the 1-year period beginning on the date
appropriations for the purposes of this section are made available,
the Secretary of Housing and Urban Development (hereafter in
this section referred to as the ''Secretarjr^) shall establish and
implement a demonstration program to determine the feasibility
of assisting States and imits of general local government to develop
methods, utilizing contemporary computer technology, to—
(1) monitor, inventory, and maintain current listings of
the commimity development needs of the States and units
of general local government; and
(2) coordinate strategies within States (especially among
various units of general local government) for meeting such
needs.
(b) INTEGRATED DATABASE SYSTEM AND COMPUTER MAPPING
TOOL.—
(1) DEVELOPMENT AND PURPOSES.—In carrying out the pro-

gram under this section, the Secretary shall provide for the
development of an integrated database system and computer
mapping tool designed to efficiently (A) collect, store, process,
and retrieve information relating to priority nonhousing
community development needs within States, and (B) coordinate strategies for meeting such needs. Tlie integrated database
system and computer mapping tool shall be designed in a
manner to coordinate and facilitate the preparation of community development plans imder section 104(mXl) of the Housing
and Community Development Act of 1974 and to process any
information necessary for such plans.
(2) AVAILABILITY TO STATES.—The Secretary shall make
the integrated database system and computer mapping tool
developed pursuant to this subsection available to States without chaise.
(3) COORDINATION WITH EXISTING TECHNOLOGY.—The Secretary shall, to the extent practicable, utilize existing technologies and coordinate such activities with existing data systems to prevent duplication.
(c) TECHNICAL ASSISTANCE.—Under the program imder this
section, the Secretary shall provide consultation and advice to States
£uid units of general local government regarding the capabilities
and advantages of the integrated database system and computer
mapping tool developed pursuant to subsection (b) and assistance
in installing and using the database system and mapping tool.
(d) GRANTS.—
(1) AUTHORITY AND PURPOSE.—The

Secretary shall, to the
extent amoimts are made available under appropriation Acts
pursuant to subsection (g), make grants to States for capital
costs relating to installation and use of the integrated database

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3859

system and computer mapping tool developed pursuant to subsection (b).
(2) LIMITATIONS.—^The Secretary may not make more than
one grant under this subsection to any single State. The Secretary may not make a grant under this subsection to any
single State in an amoimt exceeding $1,000,000.
(3) APPUCATION A]^D SELECTION.—The Secretary shall provide for the form and manner of applications for grants under
this subsection. The Secretary shall establish criteria for the
selection of States which have submitted applications to receive
grants under this section and shall select recipients according
to such criteria, which shall give priority to States havine,
on a long-term basis (as determined by the Secretary), levels
of unemployment above the national average level.
(e) STATE COORDINATION OF LOCAL NEEDS.—Each State that
receives a grant under subsection (d) shall annually submit to
the Secretary a report containing a summary of the priority
nonhousing community development needs within the State.
(D REPORTS BY SECRETARY.—The Secretary shall annually submit to the Committees on Banking, Finance and Urban Affairs
of the House of Representatives and Banking, Housing, and Urban
Affairs of the Senate, a report containing a summary of the information submitted for the year by States pursuant to subsection (e),
which shall describe the priority nonhousing community development needs within such States.
(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated for each of the fiscal years 1993 and 1994,
$10,000,000 to carry out the program estabUshed under this section.
SEC. 858. COMMUNTIY INVESTMENT CORPORATION DEMONSTRATION. Community
Investment
(a) SHORT TITLE.—^This section may be cited as the "Community Corporation
Demonstration
Investment Corporation Demonstration Act".
Act.
(b) COMMUNITY INVESTMENT CORPORATION DEMONSTRATION.— 42 u s e 5305
(1) FINDINGS.—The Congress finds that^
note.

(A) the Nation's urban and rural communities face
critical social and economic problems arising from lack
of growth; growing numbers of low-income persons and
persons living in poverty; lack of employment and other
opportunities to improve the quality of life of these residents; and lack of capital for business located in, or seeking
to locate in these communities;
(B) the future well-being of the United States and
its residents depends on the restoration and maintenance
of viable local economies, and will require increased public
and private investment in low-income housing, business
development, and economic and community development
activities, and technical assistance to local organizations
carrying out revitalization strategies;
(C) lack of expertise and technical capacitv can significantly limit the ability of residents and local institutions
to effectively carry out revitalization strategies;
(D) the Federal Government needs to develop new
models for facilitating local revitalization activities;
(E) indigenous community-based financial institutions
play a significant role in identifying and responding to
community needs; and

106 STAT. 3860

PUBLIC LAW 102-550—OCT. 28, 1992
(F) institutions, such as South Shore Bank (Chicago,
Illinois),
Southern
Development
Bancorporation
(Arkadelphia, Arkansas), Center for Community iSelf Help
(Durham, North Carolina), and Community Capital Bank
(Brooklyn, New York), with a primary mission of promoting
community development have proven their ability to
promote revitalization and are appropriate models for
restoring economic stability and growth in distressed
commimities and neighborhoods.
(2) PURPOSES.—^The demonstration program carried out
under this section shall—
(A) improve access to capital for initiatives which benefit residents and businesses in targeted geographic areas;
and
(B) test new models for bringing credit and investment
capital to targeted geographic areas and low-income persons in such areas through the provision of assistance
for capital, development services, and technical assistance
(3) DEFINITIONS.—As used in this section—
(A) the term "Federal financial supervisory agency'
means—
(i) the Comptroller of the Currency with respef t
to national banks;
(ii) the Board of (lovemors of the Federal Reser e
System with respect to State-chartered banks whi;h
are members of the Federal Reserve System and ba: ik
holding companies;
(iii) the Federal Deposit Insurance Corporat'on
with respect to State-chartered banks and savings
banks which are not members of the Federal Rese eve
System and the deposits of which are insured by th3
Federal Deposit Insurance Corporation;
(iv) the National Credit Union Administra don
Board with respect to insured credit union associations;
and
(v) the Office of Thrift Supervision with re pect
to insured savings associations and savings and loan
holding companies that are not bank hciding
companies;
(B) the term "commimity investment corpontion"
me£uis an eligible organization selected by the Secetary
to receive assistance pursuant to this section;
(C) the term "development services" means activities
that are consistent with the purposes of this sectir n and
which support and strengthen the lending and inveitment
activities undertaken by eligible organizations including—
(i) the development of real estate;
(ii) administrative activities associated with the
extension of credit or necessary to make an investment;
(iii) marketing and management assistance;
(iv) business planning and counseling services; and
(v) other capacity building activities whici enable
borrowers, prospective borrowers, or entities in which
eli^ble organizations have invested, or expect M invest,
to improve the likelihood of success of their activities;
(D) the term "eligible organization" means ail entity—
(i) that is organized as—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3861

/

(I) a depository institution holding company
as defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813); or
(II) a nonprofit organization—
(aa) that is organized under State law;
(bb) has no part of its net earnings inuring
to tiie benefit of any member, founder,
contributor, or other person;
(cc) complies with standards of financial
accountability acceptable to the Secretary; and
(dd) is affiliated with a nondepository
lending institution; or is affiliated with a regulated fmancial institution but is not a subsidiary tiiereof;
(ii) that has as its primary mission the revitalization of a targeted geographic area;
(iii) that maintams, through significant representation on its governing board and otherwise, accountabUity to community residents;
(iv) that has principals active in the implementation of its programs who possess significant experience
in lending and the development of affordable housing, small business development, or community revitalization;
(v) that directiy or through a subsidiary or affiUate
carries out development services; and
(vi) that will match any assistance received dollarfor-dollar with non-Federal sources of funds;
(E) the term "equity investment" means a capital contribution throi^h the purchase of nonvoting common stock
or through equity grants or contributions to capital reserves
or surplus, subject to terms and conditions satisfactory
to the Secretary;
(F) the term low-income person" means a person in
a family whose income does not exceed 80 percent of the
median income for the area, as determined by the Secretary
with adjustments for smaller and lar^r families;
(G) the term "regulated financial institution" means
an insured depository institution (as defined in section
3 of the Federal Deposit Insurance Act (12 U.S.C. 1813),
or an insured credit union as defined in section 101 of
the Federal Credit Union Act (12 U.S.C. 1752));
(H) the term "Secretary" means the Secretary of Housing and Urban Development;
(I) the term "targeted geographic area" means a geographically contiguous area of chronic economic distress,
as measured by unemployment, growth lag, poverty, lag
in growth of per capita income, extent of blight and disinvestment, fiscal distress, or other indicators deemed
appropriate by the Secretary, that has been identified by
an eligible organization as the area to be served by it;
and
(J) an entity is an "afiiliate" of another entity if the
first entity controls, is controlled by, or is under common
control with tiie other entiW.
(4) SELECTION CRITERIA.—The Secretary shall select eligible
organizations from among applications submitted to participate

j

106 STAT. 3862

PUBLIC LAW 102-550—OCT. 28, 1992
in the demonstration program, using selection criteria based
on—
(A) the capacity of the eligible organizations to carry
out the purposes of this section;
(B) the range and comprehensiveness of lending,
investment strategies, and development services to he
offered by the organizations directly or through subsidiaries
and affiliates thereof;
(C) the types of activities to be pursued, including
lending and development of small business, agriculture,
industrial, commercial, or residential projects;
(D) the extent of need in the targeted geographic area
to be served;
(E) the experience and background of the principals
at each eligible organization responsible for carrying out
the purposes of this section;
(F) the extent to which the eligible organizations
directly or through subsidiaries and afaliates luus successfully implemented otherrovitalizationactivities;
(G) an appropriate distribution of eligible organizations
amongregionsof the United States; and
(H) other criteria determined to be appropriate by the
Secretary and consistent with tiie purposes or this section.
(5) PROGRAM ASSISTANCE.—The Secretary shall—
(A) carry out, in accordance with this section, a program to improve access to capital and demonstrate the
feasibility of facilitating the revitalization of targeted
geographic areas by providing assistance to eligible
organizations;
(B) accept applicationsfiromeligible organizations; and
(C) select eligible organizations to receive assistance
pursuant to this section.
(6) AcnvmES REQUIRED.—All eligible organizations receiving assistance pursuant to this section are required to engage
in activities that provide access to capital for mitiatives which
benefit residents and businesses in targeted geographic areas.
(7) CAPITAL ASSISTANCE.—
(A) I N GENERAL.—

(i) IN GENERAL.—^The Secretary shall make grants
and loans to eligible organizations.
(ii) LOANS.—Assistance provided to a depository
institution holding company that is an eligible
organization as denned in paragraph (SXDXiXD shall
be in the form of a loan to be repaid to the Secretary.
The terms and conditions of each loan shall be determined by the Secretary based on the ability of such
entity to repay> except that interest shall accrue at
the current Treasury rate for obhgations of comparable
maturity.
(iii) GRANTS OR LOANS.—^Assistance provided to an
eligible organization that is a nonprofit organization,
as defined in paragraph (SXDXiXID, may be in the
form of a grant or a loan. If an eligible organization
that is a nonprofit organization uses assistance tiiat
it received under this section to provide assistance
to a for-profit entity, the assistance provided by the
nonprofit organization must be in the form of a loan

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3863

with interest to be repaid to the nonprofit organization
and the nonprofit organization must use the proceeds
of the loan tor activities consistent with this section.
(B) ELIGIBLE ACnvmES.—Capital assistance may only
be used to support the following activities that faolitate
revitalization oi tiurgeted geographic areas or that provide
economic opportunities for low-income persons—
(i) increasing the capital available for the purpose
of making loans;
(ii) providing fiinds for equity investments in
projects;
(iii) providing a portion of loan loss reserves of
regulatedfinancialinstitutions; and
(iv) providing credit enhancement.
(C) CAPITAL REQUIREMENTS.—^Any investment derived
firom assistance provided by the Seoretary and made by
an eligible organization to a regulated financial institution
shall not be included as an asset in calculating compliance
with applicable capital standards. Such standards shall
be satisfied from sources other than assistance provided
under this section.
(D) AUTHORIZATION.—^There are authorized to be appro- Appropriation
priated to carry out this paragraph $25,000,000 for fiscal authorization.
year 1993 and $26,000,000 for fiscal year 1994 to be used
to provide capital assistance to eligible organizations.
Funds appropriated pursuant to this subparagraph shall
remain available untu expended.
(8) DEVELOPMENT SERVICES AND TECHNICAL ASSISTANCE
GRANTS.—

(A) IN GENERAL.—The Secretary shall—
(i) provide grants or loans to eligible organizations
for the provision of development services that support
and contribute to the success of the mission of such
organizations; and
(ii) provide, or contract to provide, technical assistance to eligible organizations to assist in establishing
program activities that are consistent with the purposes of this section.
(B) AUTHORIZATION.—^There are authorized to be appro- Appropriation
priated to carry out this paragraph, $15,000,000 for fiscal authorization.
year 1993 and $15,600,000 for fiscal year 1994. Funds
appropriated pursuant to this subparagraph shall remain
availaole until expended.
(9) TRAINING PROGRAM.—

(A) IN GENERAL.—The Secretai^ shall establish, or con- Establishment.
tract to establish, an ongoing training program to assist
eligible organizations and their staffs m developing the
capacity to carry out the purposes of this section.
(B) AUTHORIZATION.—^There are authorized to be appro- Appropriation
priated to cany out this paragraph $2,000,000 for fiscal authorization.
year 1993 and $2,100,000 for fiscal year 1994. Funds appropriated pursuant to tiiis subparagraph shall remain available until expended.
(10) REPORTS.—^The Secretarv shall determine the appropriate reporting requirements witn which eligible organizations
receiving assistance under this section must comply.
(11) ADVISORY BOARD.—

59-194 O—93

8 : QL 3 (Pt. 5)

106 STAT. 3864

_

PUBLIC LAW 102-550—OCT. 28, 1992
(A) IN GENERAL.—^In establishing requirements to carry
out the provisions of this section, and in considering
applications under this section, the Secretary shall consult
with an advisory board comprised of the following members:
(i) the Administrator of the Small Business
,.
Administration;
(ii) two representatives from among the Federal
financial supervisory agencies who possess expertise
in matters related to extending credit to persons in
low-income communities;
(iii) two representatives of organizations that possess expertise m development of low-income housmg;
(iv) two representatives of organizations that possess expertise in economic development;
(v) two representatives of organizations that possess expertise in small business development;
(vi) two representatives from organizations that
possess expertise in the needs of low-income communities; and
(vii) two representatives from community investment corporations receiving assistance under tiiis
section.
(B) CHAIRPERSON.—The Board shall elect from among
its members a chairperson who shall serve for a term
of 2ye£irs.
(C) TERMS.—^The members shall serve for terms of
3 years which shall expire on a staggered basis.
(D) REIMBURSEMENT.—^The members shall serve without additional compensation but shall be reimbursed for
travel, per diem, and other necessary expenses incurred
in the performance of their duties as members of the
advisory board, in accordance with sections 5702 and 5703
of title 5, United States Code.
(E) DESIGNATED REPRESENTATIVES.—A member who is
necessarily absent from a meeting of the board, or of a
committee of the board, may participate in such meeting
through a duly designated representative who is serving
in the same agency or organization as the absent member.
(F) QUORUM.—^The presence of a msgority of members,
or their representatives, shall constitute a quorum.
(12) EVALUATION AND REPORT.—^The Secretary shall submit
to the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on Banking, Finance and
Urban Affairs of the House of Representatives an annual report
containing a summary of the activities carried out under this
section during the fiscal year and any preliminary findings
or conclusions drawn from the demonstration program.
(13) No BENEFIT RULE.—^To the extent that assistance is
provided to an eligible organization that is a depositonr institution holding company, the Secretary shall ensure, to the extent
practicable, that such assistance does not inure to the benefit
of directors, ofiicers, employees and stockholders.
(14) REGULATIONS.—(A) The Secretary shall issue such
regulations as may be necessary to carry out the provisions
of this subsection.
(B) The appropriate Federal financial supervisory agency,
by regulation or order—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3865

(i) may restrict any regulated financial institution's
receipt of an extension of credit firom, or investment by,
an eligible organization;
(ii) may restrict the making, by a regulated financial
institution or holding company, of an extension of credit
to, or investment in, an eligible organization; and
(iii) shall prohibit any transaction that poses an undue
risk to the affected deposit insurance fimd.
(C) To the extent practicable, the Secretary and the Federal
financial supervisory agencies shall coordinate the development
of regulations and other program guidelines.
(15) SAFETY AND SOUNDNESS OF INSURED DEPOSITORIES.—

Nothing in this section shall limit the applicability of other
law relating to the safe and sound operation and management
of a regulated financial institution (or a holding company) affiliated with an eligible organization or receiving assistance provided under this section.
(16) EFFECTIVE DATE.—^This section shall become effective
6 monthsfiromthe date of enactment of this Act.
SEC. 8S4. EMERGENCY ASSISTANCE FOR LOS ANGELES.

(a) IN GENERAL.—Of the fimds made available under 107(b)
of the Housing and Community Development Act of 1974 for purposes of this section, $3,000,000 shall be made available to each
of the following:
(1) A nonprofit community-based public benefit corporation
which was created in response to the civil disturbcmces of
April 29,1992, through May 6,1992, in Los Angeles, California,
with the support of the Speaker of the California State Assembly and commimity elected officials representing the affected
areas.
(2) A nonprofit public benefit corporation established by
the Mayor of Los Angeles and the Governor of California.
(b) USE OF FUNDS.—Such fimds shall be used to carry out
a community revitalization strategy in areas for which the President, pursuant to title IV or V of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act, declared that a mtgor disaster
or emergency existed for the purposes of such Act, as a result
of the civil disturbances involving acts of violence occurring on
or after April 29,1992, and before May 6,1992.
(c) STRATEGY.—Such strategy shedl—
(1) include efforts to create jobs in distressed neighborhoods, spur community-based economic development, improve
housing accessibility and affordability, and address other
community development needs; and
(2) be developed in consiiltation with low-income residents
and commiinity leaders in the distressed areas.
(d) ELIGIBLE ACTIVITIES.—Funds made available imder this
subsection may be used for eligible activities pursuant to section
105 of the Housing and Community Development Act of 1974 or
to provide seed capital to nonprofit community development corporations to carry out the strategy developed in subsection (cX2).
(e) MATCH REQUIRED.—^Funds provided under this section shall
be matched with private or public non-Federal funds in an amount
not less than 50 percent of the fimds provided under this section.

106 STAT. 3866

PUBLIC LAW 102-550—OCT. 28, 1992

TITLE IX—REGULATORY AND
MISCELLANEOUS PROGRAMS
Subtitle A—Miscellaneous
Appropriation
authorization.

SEC. 901. HUD RESEARCH AND DEVELOPMENT.
Section 501 of the Housing and Urban Development Act of
jg^g (12 u.S.C. 1701z-l) is amended by striking the second sentence and all that follows and inserting tne following new sentence:
There is authorized to be appropriated to carry out this title
$35,000,000 for fiscal year 1993 and $36,470,000 for fiscal year
1994.".
SEC. 902. ADMINISTRATION OF DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT.
(a) SPECIAL ASSISTANT FOR INDIAN AND ALASKA NATIVE PROGRAMS.—

42 use 3533
"°*®-

(1) RESPONSIBILITIES.—Section 4(eXl) of the Department
of Housing and Urban Development Act (42 U.S.C. 3533(eXl))
is amended—
(A) by inserting "(A)" after "(1)";
(B) in the first sentence, by striking "responsible" and
all that follows through "development" and inserting
"located in the Office of the Assistant Secretary for Public
and Indian Housing"; and
(C) by adding at the end the following new subparagraphs:
"(B) The Special Assistant for Indian and Alaska Native Programs shall be appointed based solely on merit and shall be covered
under the provisions of title 5, United States Code, governing
appointments in the competitive service.
"(C) The Special Assistant for Indian and Alaska Native Programs shall be responsible for—
"(i) administering, in coordination with the relevant office
in the Department, the provision of housing assistance to Indian
tribes or Indian housing authorities under each program of
the Department that provides for such assistance;
"(ii) administering the community development block grant
program for Indian tribes under title I of the Housing and
Community Development Act of 1974 and the provision of
assistance to Indian tribes under such Act;
"(iii) directing, coordinating, and assisting in managing
any regional offices of the Department that administer Indian
programs to the extent of such programs; and
"(iv) coordinating all i)rograms of the Department relating
to Indian and Alaska Native housing and commiinity development.
"(D) The Secretary shall include in the annual report under
section 8 a description of the extent of the housing needs for
Indian families and commimity development needs of Indian tribes
in the United States and the activities of the Department, and
extent of such activities, in meeting such needs.".
(2) TRANSFER OF FUNCTIONS.—^Not later than the expiration
of the 180-day period beginning on the date of the enactment
of this Act, the Secretary of Housing and Urban Development

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3867

shall transfer to the Special Assistant for Indian and Alaska
Native Programs any functions and duties described in section
4(eXlXB) of the Department of Housing and Urban Development Act (as added by paragraph (1) of this subsection).
(3) STAFF.—Not later than the expiration of the 1-year 42 use 3533
period beginning on the date of the enactment of this Act, ^°^the Secretary of Housing and Urban Development shall transfer
from offices within the Department of Housing and Urban
Development to the office of the Special Assistant for Indian
and Alaska Native Programs such staff, having experience and
capacity to administer Indian housing and community development programs, as may be necessary and appropriate to assist
the Special Assistant in carrying out the responsibilities under
section 4(eXlXB) of the Department of Housing and Urban
Development Act (as added by paragraph (1) of this subsection).
(b) AVOIDANCE OF FORECLOSURE ON MORTGAGES HELD BY SEC-

RETARY.—Section 7(i) of the Department of Housing and Urban
Development Act (42 U.S.C. 3535(i)) is amended—
(1) in paragraph (5), by inserting before the semicolon
the following: "; except that with respect to any mortgage
held by the Secretary, the Secretary shall, subject to the availability of amounts provided in appropriation Acts, implement
the authority under this paragraph to reduce the interest rate
on the mortgage to a rate not less than the rate for recently
issued marketable obligations of the Treasury having a comparable maturity if (and to the extent that) such a reduction,
when taken together with other actions authorized under the
National Housing Act, is necessary to avoid foreclosure on
the mortgage; and except that for any mortgage for which
the interest rate is reduced pursuant to an appropriation under
the preceding clause, if the Secretary determines that the
income or ability of the mortgagor to make interest payments
has increased, the Secretary may (not more than once for
each such mortgage) increase such interest rate to a rate not
exceeding the prevailing market rate, as determined by the
Secretary^; and
(2) in paragraph (6), by inserting before the period the
foUoMdng: ", including any provisions relating to the authority
or reqiiirements under paragraph (5)".
(c) PROGRAM MONITORING AND EVALUATION.—The first sentence Appropriation
of section 7(rX6) of the Department of Housing and Urban Develop- authorization.
ment Act (42 U.S.C. 3535(rX6)) is amended to read as follows:
There are authorized to be appropriated to carry out this subsection
such sums as may be necessary for fiscal year 1993 and fiscal
year 1994.".
SEC. 903. PARTICIPANT'S CONSENT TO RELEASE OF INFORMATION.

(a) IN GENERAL.—Section 904 of the Stewart B. McKinney
Homeless Assistance Amendments Act of 1988 (42 U.S.C. 3544)
is amended by adding at the end the following new subsection:
"(e) CONDITIONS OF RELEASE OF INFORMATION BY THIRD PAR-

TIES.—An applicant or participant imder any program of the Department of Housing and Urban Development may not be required
or requested to consent to the release of information by third
parties as a condition of initial or continuing eligibility for psurticipation in the program unless—

106 S T A T . 3868

42 u s e 3544
°°*®

P U B L I C L A W 102-550—OCT. 28, 1992

"(1) the request for consent is made, and the information
secured is maintained, in accordance with this section, section
552a of title 5, United States Code; and
"(2) the consent that is requested is appropriately limited,
with respect to time and information relevant and necessary
to meet the requirements of this section.".
(b) FORMS.—
(1) N E W FORM.—Not later than the expiration of the 180day period beginning on the date of the enactment (^ this
Act, the Secretary of Housing and Urban Development shall
develop a release form that meets the requirements of section
904 o f the Stewart B. McKinnev Homeless Assistance ^ n e n d ments Act of 1988, a s amended by this section. In developing
the form, the Secretary shall consult with interested parties,
which shall include not less than 2 representatives oi public
housing agencies, 1 representative of a national tenant
organization, 1 representative of a State tenant organization,
and 1 representative of a legal group representing tenants.
(2) E F F E C T O F OLD FORM.—^During the period oeginning
upon the date of the enactment of this Act and ending upon
implementation of the use of the form developed under paragraph (1), the benefits provided to an applicant or participant
under any program of the Department or Housing and Urban
Development, or eligibilitv for such benefits, m a y not be terminated, denied, suspendea, or reduced because of any failure
to sign any form authorizing the release of information firom
any third party (including Form HUD-9886), if the applicant
or participant otherwise discloses all financial information
relating to the application or recertification.
SEC. 904. NATIONAL INSTITUTE OF BUILDING SCIENCEg.
(a) TECHNICAL CORRECTION TO H O U S I N G A N D COMMUNITY
DEVELOPMENT A C T OF 1974.—Section 809 of the Housing and

Community Development Act of 1974 (12 U.S.C. 1701J-2) is
amended—
(1) by redesignating subsections (h) and (i) as subsections
(i) and (j), respectively; and
(2) b y inserting after subsection (g) the material inserted
bv the amendment made bv section 952(bX2) of the CranstonGonzalez National Afibrdaole Housing Act (Public Law 1 0 1 625; 104 Stat. 4418).
12 u s e i748h-i.
(b) TECHNICAL CORRECTION TO NATIONAL H O U S I N G ACT.—Section 809 of the National Housing Act is amended by striking subsection (h) (as added by section 952(b) of the Cranston-Gonzalez
National Affordable Housing Act).
Discrimination. SEC. 905. FAIR HOUSING INITIATIVES PROGRAM.
42 u s e 3616a
(a) FINDINGS.—The Congress finds that—
"°^(1) in the past half decade, there have been mi^'or legislative and administrative changes in Federal fair housing and
fair lending laws and substantial improvements in the Nation's
understanding of discrimination in the housing markets;
(2) in response to evidence of continuing housing discrimination, the Congress passed the Fair Housing Act Amendments
of 1988, to provide for more effective enforcement of fair h o u s i i ^
rights through iudicial and administrative avenues and to
expand the number of protected classes covered under Federal
fair housing laws;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3869

(3) in the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, the Congress expanded the disclosure
provisions under the Home Mortgage Disclosure Act to provide
increased information on the mortg£ige lending patterns of
financial institutions;
(4) in the Americans with Disabilities Act of 1990, the
Congress provided a clear and comprehensive national mandate
for me ehmination of discrimination against individuals with
disabilities;
(5) in 1991, data collected under the Home Mortgage Disclosure Act disclosed evidence of pervasive discrimination in the
Nation's mortgage lending markets;
(6) the Housing Discrimination Siirvey, released by the
Department of Housmg and Urban Development in 1991, found
that Hispanic and African-American homeefeekers experience
some form of discrimination in at least half of their encounters
with sales and rental agents;
(7) tiie Fair Housing Initiatives Program should be revised
and expanded to reflect the significant changes in the fair
housing and fair lending area that have taken place since
the Program's initial authorization in the Housing and Community Development Act of 1987;
(8) continuing educational efforts by the real estate industry are a useful way to increase understanding by the public
of their fair housing rights and responsibilities; and
(9) the proven emcacy of private nonprofit fair housing
enforcement organizations and community-based efforts makes
support for these organizations a necessary component of the
fair housing enforcement system.
(b) IN GENERAL.^-Section 561 of the Housing and Community
Development Act of 1987 (42 U.S.C. 3616 note) is amended—
42 use 36i6a.
(1) by redesignating subsections (b) through (e) as subsections (e) through (h), respectively;
(2) by inserting after subsection (a) the following new subsections:
"(b) PRIVATE ENFORCEMENT INITIATIVES.—

"(1) IN GENERAL.—^The Secretary shall use funds made
available under this subsection to conduct, through contracts
with private nonprofit fair housing enforcement organizations,
investigations of violations of the rights granted under title
VIII of the Civil Rights Act of 1968, and such enforcement
activities as appropriate to remedy such violations. The Secretary ma3^ enter into multiyear contracts and take such other
action as is appropriate to enhance the effectiveness of such
investigations and enforcement activities.
"(2) AcnvmES.—^The Secretary shall use funds made available under this subsection to conduct, through contracts with
private nonprofit fair housing enforcement organizations, a
range of investigative and enforcement activities designed to—
"(A) carry out testing and other investigative activities
in accordance with subsection (bXD, including building the
capacity for housing investigative activities in unserved
or underserved areas;
"(B) discover and remedy discrimination in the public
and private real estate markets and real estate-related
transactions, including, but not limited to, the making or
purchasing of loans or the provision of other financial

106 STAT. 3870

PUBLIC LAW 102-550—OCT. 28, 1992
assistance sales and rentals of housing and housing
advertising;
"(C) carry out special projects, including the development of prototypes to respond to new or sophisticated forms
of discrimination against persons protected under title VIII
of the Civil Rights Act of 1968;
"(D) provide technical assistance to local fair housing
organizations, and assist in the formation and development
of new fair housing organizations; and
"(E) provide mnds for the costs and expenses of litigation, including expert witness fees.

Contracts.

**(c) FUNDING OF FAIR HOUSING ORGANIZATIONS.—

**(1) IN GENERAL.—^The Secretary shall use funds made
available under this section to enter mto contracts or cooperative agreements with qualified fair housing enforcement
organizations, other private nonprofit fair housing enforcement
organizations, and nonprofit groups organizing to build their
capacity to provide fair housing enforcement, for the purpose
of supporting the continued development or implementation
of initiatives which enforce the rights granted under title VIII
of the Civil Rights Act of 1968, as amended. Contracts or
cooperative a^eements may not provide more than 50 percent
of the operatmg budget of the recipient organization for any
one year.
"(2) CAPACITY ENHANCEMENT.—The Secretary shall use
funds made available under this section to help establish, organize, and build the capacity of fair housing enforcement
organizations, particularly in those areas of the country which
are currently underserved by fair housing enforcement
organizations as well as those areas where large concentrations
of protected classes exist. For purposes of meeting the objectives
of this paragraph, the Secretary may enter into contracts or
cooperative agreements with qualified fair housing enforcement
organizations. The Secretary shall establish annual goals which
reflect the national need for private fair housing enforcement
organizations.
"(d) EDUCATION AND OUTREACH.—

Contracts.

"(1) IN GENERAL.—^The Secretary, through contracts with
one or more qualified fair housing enforcement organizations,
other fair housing enforcement organizations, and other nonprofit organizations representing groups of persons protected
imder title VIII of the Civil Rights Act of 1968, shall esteblish
a national education and outreach program. The national program shall be designed to provide a centralized, coordinated
efibrt for the development and dissemination of fair housing
media products, including—
"(A) public service announcements, both audio and
video;
"(B) television, radio and print advertisemente;
"(C) posters; and
"(D) pamphlets and brochures.
The Secretory shall designate a portion of the amoimte provided
in subsection (gX4) for a national program specifically for activities related to the annual national fair housing month. The
Secretory shall encourage cooperation with real estoto industry
organizations in the national education and outreach program.
The Secretory shall also encourage the dissemination of edu-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3871

cational information and tedinical assistance to support compliance with the housing adaptability and accessibility guidelines
contained in the Fair Housing Act Amendments of 1988.
"(2) REGIONAL AND LOCAL PROGRAMS.—The Secretary, Contracts.
through contracts with fair housing enforcement organizations,
other nonprofit organizations representii^ groups of persons
protected under title VIII of the Civil Rights Act of 1968,
State and local agencies certified by the Secretary under section
810(f) of the Fair Housing Act, or other pubUc or private entities
that are formulating or carrying out programs to prevent or
eliminate discriminatory housing practices, shall establish or
support education and outreach programs at the regional and
local levels.
••(3) COMMUNITY-BASED PROGRAMS.—The Secretary shall
provide fiinding to fair housing organizations and other nonprofit organizations representing groups of persons protected
under title VIII of the Civil lUghts Act of 1968, or other public
or private entities that are formulating or carrying out programs to prevent or eliminate discriminatory housing practices,
to support community-based education and outreach activities,
including school, church, and community presentations, conferences, and other educational activities.";
(3) in subsection (g), as redesignated by paragraph (1)
by striking all in the first sentence after "section, and inserting
the following: "$21,000,000 for fiscal year 1993 and $26,000,000
forfiscalyear 1994, of which—
"(1) not less than $3,820,000 for fiscal year 1993 and
$8,500,000 for fiscal year 1994 shall be for private enforcement
initiatives authorized under subsection (b), divided equally
between activities specified under subsection ObXD and those
specified under subsection (bX2);
"(2) not less than $2,230,000 for fiscal year 1993 and
$8,500,000 forfiscalyear 1994 shall be for qualified fair housing
enforcement organizations authorized under subsection (cXD;
"(3) not less than $2,010,000 for fiscal year 1993 and
$4,000,000 for fiscal year 1994 shall be for the creation of
new fair housing enforcement organizations authorized under
subsection (cX2); and
"(4) not less than $2,540,000 for fiscal year 1993 and
$5,000,000 for fiscal year 1994 shall be for education and outreach programs authorized under subsection (d), to be divided
equally between activities specified under subsection (dXD and
those specified under subsections (dX2) and (dX3).''; and
(4) by striking subsection (h), as redesignated by paragraph
(1), and inserting the following:
"(h) QUALIFIED FAIR HOUSING ENFORCEMENT ORGANIZATION.—

(1) The term 'qualified fair housing enforcement organization' means
any organization that—
"(A) is organized as a private, tax-exempt, nonprofit, chariteble organization;
"(B) has at least 2 years exjperience in complaint intake,
complahit investigation, testing for fair housing violations and
enforcement of meritorious claims; and
"(C) is engaged in all the activities hsted in paragraph
(IXB) at the time of appUcation for assistance under this
section.

106 STAT. 3872

'

104 Stat. 4413.

/
V

/

PUBLIC LAW 102-550—OCT. 28, 1992

An organization which is not solely engaged in fair housing enforcement activities ma^ qualify as a qualified fair housing enforcement
organization, provided that the organization is actively engaged
in each of the activities listed in subparagraph (B).
"(2) The term fair housing enforcement organization' means
any organization that—
"(A) meets the requirements specified in para^aph (IXA);
"(B) is currently engaged in the activities specifiea in paragraph (IXB);
"(C) upon the receipt of funds under this section will become
engaged in all of the activities specified in paragraph (IXB);
and
"(D) for purposes of fimding imder subsection (b), has at
least 1 year of experience in the activities specified in paragraph
(IXB).
'*(i) PROHffirnoN ON USE OF FUNDS.—None of the fimds authorized under this section may be used by the Secretary for purposes
of settling claims, satisfying judgments or fiilfilling court orders
in any litigation action involving either the Department or housing
providers mnded by the Department. None of the fimds authorized
under this section may be used by tJie Department for administrative costs.
"(j) REPORTING REQUIREMENTS.—Not later than 180 days afl^er
the close of each fiscal year in which assistance under this section
is fiimished, the Secretary shall prepare and submit to the Congress
a comprehensive report which shall contain—
"(1) a description of the progress made in accomplishing
the objectives of this section;
"(2) a summary of all the private enforcement activities
carried out under tnis section and the use of such fimds during
the precedingfiscalyear;
"(3) a list of all fair housing enforcement organizations
fimdeid under this section during the preceding fiscal year,
identified on a State-by-State basis;
"(4) a summary of all education and outreach activities
fimded under this section and the use of such fimds during
the precedingfiscalyear; and
"(5) any findings, conclusions, or recommendations of the
Secretary as a result of thefiindedactivities.".
SEC. 908. NATIONAL COMMISSION ON MANUFACTURED HOUSING.
(a) AUTHORIZATION OF APPROPRIATIONS.—Section 943(f) of

the
Cranston-Croiizalez National Affordable Housing Act is amended
to read as follows:
"(f) AUTHORIZATION.—Of the amount appropriated pursuant to
section 501 of the Housing and Urban Development Act of 1970
(12 U.S.C. ITOlz-l), there shall be set aside to carry out this
section $1,000,000 for fiscal year 1993. Any amounts provided
pursuant to this section shall remain available until expended.".
(b) FUNCTIONS OF THE COMMISSION.—Section 943(dXl) of the
Cranston-C^nzalez National Affordable Housing Act is amended—
(1) in subparagraph (G), by striking "and" at the end;
(2) by adding after subparagraph ((T) the following new
subparagraphs:
(H) evaluate the extent to which manufacturers in
compliance with Federal standards do and should comply
wiUi State implied or expressed warranty requirements;

('^^

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3873

"(I) examine the feasibility of expanding and establishing standeurds governing manufactured home sales including transportation and on-site set up; and"; and
(3) by redesignating subparagraph (H) as subparagraph
(J).
(c) EXTENSION OF TERMINATION DATE.—Section 943(g) of the
Cranston-Gonzalez National Affordable Housing Act is amended 104 Stat. 4413.
by striking 'Sipon the expiration of the 9 months following the
appointment of all the members under subsection (c)" and inserting
"on October 1,1993".
(d) STAFF.—Section 943(e) of the Cranston-Cionzalez National
Affordable Housing Act (Public Law 101-625; 104 Stat. 44134) 104 Stat. 4413.
is amended by adding at tiie end the following new paragraph:
"(7) STAFF.—
"(A) EXECUTIVE DIRECTOR.—The

Commission shall
appoint an executive director of the Conunission who shall
be compensated at a rate fixed by the Commission, but
which may not exceed the rate established for level V
of the Executive Schedule under title 5, United States
Code.
"(B) PERSONNEL.—^In addition to the executive director,
the (Commission may appoint and fix the compensation
of such personnel as the Commission deems advisable,
in accordance with the provisions of title 5, United States
Code, governing appointments to the competitive service,
and the provisions of chapter 51 and subchapter III of
chapter 53 of such title, relating to classification and Greneral Schedule pay rates.
"(C) LIMITATION.—This paragraph shall be effective
only to the extent amounts are made available in appropriation Acts.".
SEC. 907. MANUFACTURED HOUSING.

Section 604 of the Housing and Community Development Act
of 1974 (42 U.S.C. 5403) is amended by adding at the end the
foUowingnew subsection:
**(]) The Secretary shall develop a new standard for hardboard
panel siding on manufactured housing taking into account durability, longevity, consumer's costs for maintenance and any other
relevant information pursuant to subsection (0- The Secreta^ shall
consult with the National Manufactured Home Advisory Council
and the National Commission on Manufactured Housing in
establishing the new standard. The new performance standard
developed shall ensure the durability of hardboard sidings for at
least a normal life of a mortgage with minimum maintenance
required. Not later than 180 days from the date of enactment
of this subsection, the Secretary shall update the standards for
hardboard siding.".
SEC. 908. SEAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974.
(a) APPUCABIUTY TO MORTGAGE ORIGINATION.—Section 3(3)

of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C.
2602(3)) is amended by inserting after'ni>roker," the following:'Hhe
origination of a federally related mortgage loan (including, but
not limited to, the taking of loan applications, loan processing,
and the underwriting and funding of loans),".

106 STAT. 3874

PUBLIC LAW 102-550—OCT. 28, 1992
(b) APPUCABIUTY TO SECOND MORTGAGES AND REFINANCINGS.—

12 use 2602
^°^-

Section 3(1XA) of the Real Estate Settlement Procedures Act of
1974 (12 U.S.C. 2602(1XA)) is amended—
(1) by inserting "or subordinate" after ''first'*; and
(2) by inserting before the semicolon the following: ", including any such secured loan, the proceeds of which are used
to prepay or pay off an existing loan secured by the same
propertjr.
(c) REGULATIONS.—The Secretary of Housing and Urban Development shall issue regulations to implement the amendments made
by this section not later than the expiration of the 180-day period
beginning on the date of the enactment of this Act. The regulations
shall be issued after notice and opportunity for public comment
pursuant to the provisions of section 553 of title 5, United States
Code (notwithstanding subsections (aX2), (bXB), and (dX3) of such
S6ci«ioii.)

12 use 2602
"°^-

12 use 2903.

(d) EFFECTIVE DATE.—This section shall take effect on the
date of enactment of this Act and shall not apply retroactively.
SEC. 909. COMMUNITY REINVESTMENT ACT OF 1977.
The Community Reinvestment Act of 1977 (12 U.S.C. 2901
et seq.) is amended—
(1) in section 804—
(A) by inserting before the first sentence the following:
"(a) IN GENERAL.—*; and

12 use 2907.
12 use 2901

(B) by adding at the end the following new subsection:
"(b) MAJORITY-OWNED INSTITUTIONS.—In assessing and taking
into account, under subsection (a), the record of a nonminorityowned and nonwomen-owned financial institution, the appropriate
Federal financial supervisory agency may consider as a factor capital investment, loan participation, and other ventures undertaken
by the institution in cooperation with minority- and women-owned
financial institutions and low-income credit unions provided that
these activities help meet the credit needs of local communities
in which such institutions and credit unions are chartered."; and
(2) in section 808(a), by striking "shall be treated as" and
inserting "may be a factor in determining whether the depository institution is".
SEC. 910. REPORT ON COMMUNITY DEVELOPMENT LENDING.
(a) I N GENERAL.—^Not later than 12 months after the date
of enactment of this section, the Board of Governors of the Federal
Reserve System, in consultation with the Comptroller of the Currency, the Chairman of the Federal Deposit Insurance Corporation,
the Director of the Office of Thrift Supervision, and the Chairman
of the National Credit Union Administration, shall submit a report
to the Congress comparing residential, small business, and commercial lending by insured depository institutions in low-income,
minority, and distressed neighborhoods to such lending in other
neighborhoods.
(b) CONTENTS OF REPORT.—^The report required by subsection
(a) shall—
(1) compare the risks and returns of lending in low-income,
minority, and distressed neighborhoods with the risks and
returns of lending in other neighborhoods;
(2) analyze the reasons for any differences in risk and
return between low-income, minority, and distressed neighborhocMds and otiier neighborhoods; and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3875

(3) if the risks of lending in low-income, minority, and
distressed neighborhoods exceed the risks of lending in other
neighborhoods, recommend ways of mitigating those risks.
SEC. 911. SUBSroV LAYERING REVIEW.

42 USC 3545

(a) IN GENERAL.—^The Secretary shall establish guidelines for
housing credit agencies, as defined imder section 42 of the Internal
Revenue Code of 1986, to implement the requirements of section
102(d) of the Department of Housing and Urban Development
Reform Act of 1989 (42 U.S.C. 3545(d)) for projects receiving assistsince within the jurisdiction of the Department of Housing and
Urban Development and imder section 42 of the Internal Revenue
Code of 1986.
(b) IN PARTICULAR.—^The guidelines established pursuant to
subsection (a) shall—
(1) require that the amount of equity capital contributed
by investors to a project partnership is not less than the amount
generally contributed by investors in current market conditions,
as determined by the housing credit agency; and
(2) require that project costs, including developer fees, are
within a reasonable range, taking into account project size,
project characteristics, project location and project risk factors,
as determined by the housing credit agency.
(c) EFFECTIVE DATE.—^As of January 1, 1993, a housing credit
agency shall carry out the responsibilities of section 102(d) of the
Housing and Urban Development Reform Act for projects allocated
a low-income housing tax credit pursuant to section 42 of the
Internal Revenue Code of 1986 if such agency certifies to the
Secretary that it is properly implementing the guidelines established under subsection (a). The Secretary may revoke the responsibility delegated in the preceding sentence if the Secretary determines that a housing credit agency has failed to properly implement
such guidelines.
(d) APPLICABILITY.—Section 102(d) of the Department of Housing and Urban Development Reform Act of 1989 (42 U.S.C. 3545(d))
shall apply only to projects for which an application for assistance
or insurance was filed after the date of enactment of the Housing
and Urban Development Reform Act.
SEC. 912. SOLAR ASSISTANCE FINANCING ENTITY.

(a) ESTABLISHMENT.—The Secretary of Housing and Urban
Development shall establish within the Department of Housing
and Urban Development the Solar Assistance Financing Entity
(in this section referred to as the "Entity").
(b) PURPOSE.—^The purpose of the Entity shall be to assist
in financing solar and renewable energy capital investments and
projects for eligible buildings under subsection (c).
(c) ELIGIBLE BUILDINGS.—The Entity may provide assistance
under this section only for the following buildings:
(1) SINGLE FAMILY HOUSING.—Any building consisting of
1 to 4 dwelling imits that has a system for heating or cooling,
or both.
(2) MULTIFAMILY HOUSING.—Any building consisting of
more than 4 dwelling units that has a system for heating
or cooling, or both.
(3) COMMERCIAL BUILDINGS.—^Any building used primarily
to carry on a business (including any nonprofit business) that

42 USC 5511a.

106 STAT. 3876

PUBLIC LAW 102-550—OCT. 28, 1992
is not used primarily for the manufacture or production of
raw materials, products, or agricultural commodities.
(4) SCHOOLS, HOSPITALS, AND AGRICULTURAL BUILDINGS.—

Any school, any hospital, and any building used exclusively
in connection with the harvesting, storage, or diying of agricultural commodities.
(5) OTHER BUILDINGS.—Any other building of a type that
the Entity considers appropriate.
(d) FINANCING OPTIONS.—Assistance provided under this section by the Entity may be provided only for programs for financing
solar and renewable energy capital investments and projects, which
may include programs for making loans, making grants, reducing
the principal obligations of loans, prepajonent of interest on loans,
purchase and sale of loans and advances of credit, providing loan
guarantees, providing loan downpayment assistance, and providing
rebates and other incentives for the purchase and installation of
solar and renewable energy measures.
(e) AUTHORITY TO LEVERAGE OTHER FUNDS.—The Entity may
encourage or require programs receiving assistance under this section to supplement the assistance received under this section with
amounts from other public and private sources, and, in making
assistance under this section available, may give preference to
programs that leverage amoimts from such other sources.
(f) PROVISION OF ASSISTANCE.—^The Entity shall provide assistance under this section through State agencies responsible for developing State energy conservation plans pursuant to section 362
of the Energy Poficy and Conservation Act, or any other entity
or agency authorized to specifically carry out the purposes of this
section.
(g) REGULATIONS.—Not later than the expiration of the 12month period beginning on the date of the enactment of this Act,
the Secretary of Housing and Urban Development, in consultation
with the Secretary of Energy, shall issue any regulations necessary
to carry out this section, which shall ensure maximum flexibility
in utilizing amounts made available under this section.
(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to carry out this section $10,000,000 for fiscal
year 1993 and $10,420,000 for fiscal year 1994. Such sums are
to be available until expended.
(i) REPEALS.—
(1) SOLAR ENERGY AND ENERGY CONSERVATION BANK ACT.—

Subtitle A of title V of the Energy Security Act (12 U.S.C.
3601 et seq.) is repealed.
(2) FEDERAL NATIONAL MORTGAGE ASSOCLVTION CHARTER

ACT.—Sections 315 and 316 of the Federal National Mortgage
Association Charter Act (12 U.S.C. 1723g, 1723h) are repealed.
SEC. 913. TECHNICAL AND CONFORMING AMENDMENTS RELATING TO

LABOR WAGE RATES UNDER HOUSING PROGRAMS.
(a) SUPPORTIVE HOUSING FOR THE ELDERLY.—Section 2020X6)
of the Housing Act of 1959 (12 U.S.C. 1701q(j)(5)), as amended
by section 801 of the Cranston-Gonzalez National Affordable Housing Act, is amended to read as follows:
"(5) LABOR.—

"(A) IN GENERAL.—^The Secretary shall take such action
as may be necessary to ensure that all laborers and mechanics
employed by contractors and subcontractors in the construction

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3877

of housing with 12 or more units assisted under this section
shall he paid wages at rates not less than the rates prevailing
in the locality involved for the corresponding classes of laborers
and mechanics employed on construction of a similar character,
as determined by the Secretary of Labor in accordance with
the Act of March 3, 1931 (commonly known as the DavisBacon Act).
"(B) EXEMPTION.—Subparagraph (A) shall not apply to any
individual who—
**(i) performs services for which the individual volimteered;
"(iiXD does not receive compensation for such services;
or
"(11) is paid expenses, reasonable benefits, or a nominal
fee for such services; and
"(iii) is not otherwise employed at any time in the
construction work.",
(b) SUPPORTIVE HOUSING FOR PERSONS WITH DISABILITIES.—

Section 811()X6) of the Cranston-Cjonzalez National Affordable
Housing Act (42 U.S.C. 8013(jX6)) is amended—
(1) by striking "(6) LABOR STANDARDS.—The Secretary" and
inserting the following:
"(6) LABOR STANDARDS.—

"(A) IN GENERAL.—The Secretary";
(2) by striking "assisted under this section and designed
for dwelling uae by 12 or more persons with disabilities" and
inserting "with 12 or more units assisted under this section";
(3) by inserting "commonly known as" before "the DavisBacon Act";
(4) by striking "; but the Secretary" and all that follows
through "undertaking the construction"; and
(5) by adding at the end the following new subparagraph:
"(B) EXEMPTION.—Subparagraph (A) shall not apply
to any individual who—
"(i) performs services for which the individual volunteered;
"(iiXI) does not receive compensation for such services; or
"(II) is paid expenses, reasonable benefits, or a
nominal fee for such services; and
"(iii) is not otherwise employed at any time in
the construction work.".
SEC. 914. ENERGY EFFICIENT MORTGAGES.
(a) DEFINITION OF ENERGY EFFICIENT MORTGAGE.—Section 104

of the Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 12704), as amended bv section 210(aXl) of this Act, is
further amended by adding at the end the following new paragraph:
"(25) The term 'energy efficient mortgage' means a mortgage that provides financing incentives for the purchase of
energy efficient homes, or that provides financing incentives
to make energy efficiency improvements in existing homes by
incorporating the cost of such improvements in the mortgage. .
(b) UNIFORM MORTGAGE FINANCING PLAN FOR ENERGY EFFI-

CIENCY.—Section 946 of the Cranston-Gronzalez National Affordable
Housing Act (42 U.S.C. 12712 note) is amended—

106 STAT. 3878

PUBLIC LAW 102-550—OCT. 28, 1992

(1) in subsection (a), by striking "mortgage financing incentives for energy efficiency" and inserting "energy efficient mortgages (as sudn term is defined in section 104 of this Act)";
and
(2) in subsection (b)—
(A) in the second sentence, by inserting ", but not
be limited to," afler "include"; and
(B) by inserting after the period at the end of the
following new sentence: "The Task Force shall determine
whether notifying potential home purchasers of the availability of energy efficient mortgages would promote energy
efficiency in residential buildings, and if so, the Task Force
shall recommend ai)propriate notification guidelines, and
agencies and organizations referred to in the preceding
sentence are authorized to implement such guidelines. .
SEC. »16. ECONOMIC OPPORTUNITIES FOR LOW- AND VERY LOWINCOME PERSONS.
Section 3 of the Housing and Urban Development Act of 1968
(12 U.S.C. 1701u) is amended to read as follows:
•^EC. 3. ECONOMIC OPPORTUNITIES FOR LOW- AND VERY LOWINCOME PERSONS.
"(a) FINDINGS.—The Congress finds that^"(1) Federal housing and community development programs
provide State and local governments and other recipients of
Federal financial assistance with substantial funds for projects
and activities that produce significant employment and other
economic opportunities;
"(2) low- and very low-income persons, especially recipients
of government assistance for housing, often have restricted
access to employment and other economic opportunities;
"(3) the employment and other economic opportunities generated by projects and activities that receive Federal housing
and community development assistance offer an effective means
of empowering low- and very low-income persons, particularly
persons who are recipients of government assistance for housing; and
"(4) prior Federal efforts to direct employment and other
economic opportunities generated bv Federal housing and
community development programs to low- and very low-income
persons have not Seen full^ effective and should be intensified.
(b) POLICY.—It is the policy of the Congress and the purpose
of this section to ensure that the employment and other economic
opportimities generated by Federal financial assistance for housing
and community development programs shall, to the greatest extent
feasible, be directed toward low- and very low-income persons,
particularly those who are recipients of government assistance for
housing.
"(c) EMPLOYMENT.—

"(1) PUBUC AND INDIAN HOUSING PROGRAM.—
"(A) IN GENERAL.—The Secretary shall require that
public and Indian housing agencies, and their contractors
and subcontractors, make their best efforts, consistent with
existing Federal, State, and local laws and regulations,
to give to low- and very low-income persons the training
and employment opportunities generated by development
assistance provided pursuant to section 5 of the United

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3879

States Housing Act of 1937, operating assistance provided
pursuant to section 9 of that Act, and modernization grants
provided pursuant to section 14 of that Act.
"(B) PRIORITY.—^The efforts required under subparagraph (A) shall be directed in the following order of priority:
"(i) To residents of the housing developments for
which the assistance is expended.
"(ii) To residents of other developments managed
by the public or Indian housing agency that is expending the assistance.
"(iii) To participants in Youthbuild programs
receiving assistance imder subtitle D of title IV of
the Cranston-Gonzalez National Affordable Housing
Act.
**(iv) To other low- and very low-income persons
residing within the metropolitan area (or
nonmetropolitan county) in which the assistance is
expended.
**(2) OTHER PROGRAMS.—

"(A) IN GENERAL.—^In other programs that provide
housing and community development assistance, the Secretary shall ensure that, to the greatest extent feasible,
and consistent with existing Federal, State, and local laws
and regulations, opportunities for training and emplojrment
arising in connection with a housing rehabilitation (including reduction and abatement of lead-based paint hazards),
housing construction, or other public construction project
are given to low- and very low-income persons residing
within the metropolitan area (or nonmetropoUtan county)
in which the project is located.
**(B) PRIORITY.—^Where feasible, priority should be
given to low- suid very low-income persons residing within
the service area of the project or the neighboniood in
which the project is located and to pajrticipants in
Youthbuild programs receiving assistance under subtitle
D of title IV of the Cranston-Gonzalez National Affordable
Housing Act.
"(d) CONTRACTING.—
"(1) PUBLIC AND INDIAN HOUSING PROGRAM.—

"(A) IN GENERAL.—The Secretary shall require that
public and Indian housing agencies, and their contractors
and subcontractors, make their best efforts, consistent with
existing Federal, State, and local laws and regulations,
to award contracts for work to be performed in connection
with development assistance provided pursuant to section
5 of the United States Housing Act of 1937, operating
assistance provided pursuant to section 9 of that Act, and
modernization grantis provided pursuant to section 14 of
that Act, to business concerns that provide economic
opportimities for low- and very low-income persons.
**(B) PRIORITY.—^The efforts required under subparagraph (A) shall be directed in the following order of priority:
"(i) To business concerns that provide economic
opportunities for residents of the housing development
for which the assistance is provided.
"(ii) To business concerns that provide economic
opportunities for residents of other nousing develop-

106 STAT. 3880

PUBLIC LAW 102-550—OCT. 28, 1992

u

ments operated by the public and Indian housing
agency that is providing the assistance.
"(iii) To Youthbuild programs receiving assistance
under subtitle D of title IV of the Cranston-Gonzalez
National Affordable Housing Act.
''(iv) To business concerns that provide economic
opportimities for low- and very low-income persons
residing within the metropolitan area (or
nonmetropolitan county) in which the assistance is
provided.
"(2) OTHER PROGRAMS.—

"(A) IN GENERAL.—In providing housing and community development assistance pursuant to other programs,
the Secretary shall ensure that, to the greatest extent
feasible, and consistent with existing Federal, State, and
local laws and regulations, contracts awarded for work
to be performed in connection with a housing rehabilitation
(including reduction and abatement of lead-based paint
hazards), housing construction, or other public construction
project are given to business concerns that provide economic opportunities for low- and very low-income persons
residing within the metropolitan area (or nonmetropolitan
county) in which the assistance is expended.
"(B) PRIORITY.—^Where feasible, priority should be
given to business concerns which provide economic
opportunities for low- and very low-income persons residing
within the service area of the project or the neighborhood
in which the project is located and to Youthbuild programs
receiving assistance under subtitle D of title IV of the
Cranston-Gonzalez National Affordable Housing Act.
"(e) DEFINITIONS.—For the purposes of this section the following
definitions shall apply:
"(1) LOW- AND VERY LOW-INCOME PERSONS.—The terms 'lowincome persons' and Very low-income persons' have the same
meanings given the terms 'low-income families' and 'very lowincome families', respectively, in section 3(bX2) of the United
States Housing Act of 1937.
"(2)

BUSINESS

CONCERN

THAT

PROVIDES ECONOMIC

OPPORTUNITIES.—The term *a business concern that provides
economic op(>ortunities' means a business concern that—
"(A) provides economic opportunities for a class of persons that has a mtgority controlling interest in tiie
business;
"(B) employs a substantial number of such persons;
or
"(C) meets such other criteria as the Secretary may
establish,
"(f) COORDINATION WITH OTHER FEDERAL AGENCIES.—The Secretary shall consult with the Secretary of Labor, the Secretary
of Health and Human Services, the Secretary of Commerce, the
Administrator of the Small Business Administration, and such other
Federal agencies as the Secretary determines are necessary to
carry out this section.
"(g) REGULATIONS.—Not later than 180 days after the date
of enactment of Uie National Affordable Housing Act Amendments
of 1992, the Secretary shall promulgate regulations to implement
this section.".

PUBLIC LAW 102-550—OCT. 28,1992

106 STAT. 3881

SBC. 9M. STUDY OF THE EFFECTIVBNESS OF SECTION S OF THE HOUS- 12 USC 1701u
note.
ING AND UBBAN DEVELOPBIENT ACT (»'1968.
(a) IN GENERAL.—The Secretary of Housing and Urban Develop- Reports.
ment shall submit to the Congress, not later than 1 year after
tiie date of the enactment of this Act, a report describing—
(1) the Secretary's efforts to enforce section 3 of the Housing
and Urban Development Act of 1968;
(2) tiie barriers to full implementation of section 3 of the
Housing and Urban Development Act of 1968;
(3) the anticipated costs and benefits of fiill implementation
of section 3 of tiie Housing and Urban Development Act of
1968; and
(4) recommendations for legislative changes to enhance
the effectiveness of section 3 of the Housing and Urban Development Act of 1968.
(b) CONTENTS.—

(1) ENFORCEMENT.—^The description under subsection (aXD
of the Secretary's enforcement efforts shall include, at a
TfiiniinuTW—
(A) a discussion of how responsibility for implementing
section 3 of the Housing and Urban Development Act of
1968 is allocated within the Department of Housing and
Urban Development;
(B) a discussion of the status of existing regulations
implementing such section 3;
(C) a discussion of ongoing efforts to enforce current
regulations;
(D) a list of the programs under the responsibility
of the Secretary with respect to which the Secretary is
enforcing section 3; and
(E) a separate description of the activities carried out
under section 3 with respect to each of these programs.
(2) IMPEDIMENTS.—^The discussion under subsection (aX2)
of the external impediments to effective enforcement of section
3 of the Housing and Urban Development Act of 1968 shall
include, at a minimum, a discussion of—
(A) any lack of necessary training for targeted employees and tedinical assistance to target^ businesses;
(B) any barriers created by Federal, State, or local
procurement regulations or other laws;
(C) any difficulties in coordination with labor unions;
(D) any difficulties in coordination with other
implicated Federal agencies; and
(E) any lack of resources on the part of recipients
of assistance who are responsible for carrying out section
3 of the Housing and Urban Development Act of 1968.
(c) CONSULTATION.—^In preparing the report under this subsection, the Secretary shall consult with the Secretary of Labor,
the Secretary of Conmierce, the Secretary of Health and Human
Services, the Administrator of the Small Business Administration,
ot^er appropriate Federal officials, and recipients of Federal housing
and community development assistance who are responsible for
executing section 3 of the Housing and Urban Development Act
of 1968.

106 STAT. 3882

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 917. INDIAN HOUSING AUTHORITIEa

Appropriation
authorization.

There is authorized to be appropriated $500,000 for fiscal year
1993 ^^d $521,000 for fiscal year 1994 to a nonprofit organization
under section 501(cX3) of the Internal Revenue Code of 1986 tiiat
has been in existence since 1975 and that provides training, technical assistance, and information to Indiim housing authorities,
Indian tribal governments, and other groups. These sums shall
be used by such nonprofit organization to—
(1) provide technical assistance and training to Indian housing authorities;
(2) improve the administrative capacities of Indian housing
authorities; and
(3) provide for other activities designed to improve Indian
housing conditions.
SEC. 918. STUDY REGARDING FORECLOSURE ALTERNATIVES.
(a) IN GENERAL.—^The Secretary of Housing and Urban Development shall conduct a study to review and analyze alternatives
to foreclosure for homeowners whose principal residences are subject
to federally-related mortgages (in connection with federally related
mortgage loans, as such term is defined in section 3 of the Real
Estate Settlement Procedures Act of 1974) under which the homeowner is in default. In conducting the study, the Secretary—
(1) may consult with any appropriate Federal agencies
that make, insure, or guarantee morteage loans relating to
1- to 4-family dwellings and with the Federal National Nfortgage Association, the Federal Home Loan Mortgage Corporation, the Government National Mortgage Association, and the
Federal Agricultural Mortgage Corporation; and
(2) shall review and assess the adequacy, with respect
to providing alternatives to foreclosure, of—
(A) the temporary mortgage assistance payments program authorized under section 230 of the National Housing
Act;
(B) the authority of the Secretary to modify interest
rates and other terms of mortgages transferred to the Secretary under section 7(i) of the Department of Housing
and Urban Development Act; and
(C) any authority pursuant to Debt Collection Act of
.. > 1982 to reduce interest rates on outstanding debt to the
borrowing rate for the Treasury of the United States.
The Secretary shall evaluate alternatives to foreclosure based on
fairness of the procedures to the homeowner and reducing adverse
effects on the mortgage lending system.
(b) REPORT.—Not later than March 1, 1993, the Secretary shall
submit a report to the Congress regarding the results of the study
conducted under subsection (a). The report shall contain a detailed
description and assessment of each alternative to foreclosure analyzed imder the study and a statement by the Secretary regarding
the intent of the Secretary to use any authority available under
the provisions referred to in subsection (aX2) to avoid foreclosure
imder mortgages (and any reasons for not using such authority).
The report may also contain any recommendations of the Secretiuy
for administrative or legislative action to assist homeowners to
avoid foreclosure and any loss of equity in their mortgaged homes
that may resultfiromforeclosure.

PUBLIC LAW 102-550—OCT. 28, 1992

^ 6 6 STAT. 3883

SEC. 919. BEGUIATIONS CLARIFYING THE TERM < V O t ^ 4 G FOR
OLDER PERSONS".
^r=;=^S^

42 USC 3607
note.

The Secretary of Housing and Urban Development shall, not
later than 180 days after the date of the enactment of this Act,
make rules defining what are "significant facilities and services
especisdly designed to meet the physical or social needs of older
persons" required under section 807(bX2) of the Fair Housing Act
to meet the definition of the term "housing for older persons"
in such section.
SEC. 920. USE OF DOMESTnC PRODUCTS.
(a) PROHIBITION AGAINST FRAUDULENT U S E OF "MADE IN AMER-

42 USC 3546.

ICA" LABELS.—^A person shsdl not intentionally affix a label bearing
the inscription of "Made in America", or any inscription with that
meaning, to any product sold in or shipped to the United States,
if that product is not a domestic product.
(b) REPORT.—^The Secretary of Housing and Urban Development
and the Secretary of Agriculture shall each submit, before January 1, 1994, a report to the Congress on ps'ocurements of products
that are not domestic products.
(c) DEFINITIONS.—For the purposes of this section, the term
"domestic product" means a product—
(1) that is manufactured or produced in the United States;
and
(2) at least 50 percent of the cost of the articles, materials,
or supplies of which are mined, produced, or manufactured
in the United States.
SEC. 921. IMPROVED COORDINATION OF UREAN POUCY.

Title VII of the Housing and Urban Development Act of 1970
(42 U.S.C. 4501 et seq.) is amended—
(1) in section 702(d), by striking paragraph (8) and inserting ^2 use 4502.
the following:
"(8) increase coordination among Federal programs that
seek to promote job opportimities and skills, decent and affordable housing, public safety, access to healUi care, educational
opportunities, and fiscal soimdness for urban communities and
their residents.";
(2) in section 703(a)—
42 USC 4503.
(A) by striking "during February 1978, and during
February of every even-numbered year thereafter," and
inserting ", not later than June 1, 1993, and not later
than the first day of June of every odd-numbered year
thereafter,"; and
(B) in paragraph (8), by striking "such" and all that
follows through the end of the sentence and inserting "legislative or administrative proposals—
"(A) to promote coordination among Federal programs
^
^
to assist urban areas;
"(B) to enhance the fiscal capacity of fiscally distressed
urban areas;
"(C) to promote job opportunities in economically distressed urban areas and to enhance the job skills oi residents of such areas;
"(D) to generate decent and affordable housing;
"(E) to reduce racial^ tensions and to combat racial
and ethnic violence in urbipi areas;

ff'

106 STAT. 3884

42 use 4503.

PUBLIC LAW 102-550—OCT. 28, 1992

"(F) to combat urban drug abuse and drug-related
crime and violence;
"(G) to promote the delivery of health care to lowincome conmiunities in urban areas;
"(H) to expand educational opportunities in urban
areas; and
"(I) to achieve the goals of the national urban policy.";
and
(3) by adding at the end of section 703 the following new
subsection:
"(d) REFERRAL.—The National Urban Policy Report shall, when
transmitted to Congress, be referred in the Senate to the Committee
on Banking, Housing, and Urban Affairs, and in the House of
Representatives to the Committee on Banking, Finance and Urban
Affairs.".
SEC. 922. PROHmrnON OF LUMP-SUM PAYMENTS.

The Department of Housing and Urban Development Act (42
U.S.C. 3531 et seq.) is amended by adding at the end the following
new section:
"PROHIBITION OF LUMP-SUM PAYMENTS

42 use 3537c.

"SEC. 14. In providing relocation assistance in connection with
any program administered by the Department of Housing and
Urban Development, the Secretanr may not make lump-siun payments to any displaced residential tenant, except where necessary
to cover—
"(1) moving expenses;
"(2) a downpayment on the purchase of a replacement
residence, incluoing a condominium unit or membership in
a cooperative housing association; or
"(3) any incidental expenses related to paragraph (1) or

42 u s e 12714

SEC. 923. ECONOMIC INDEPENDENCE.

The Secretarv of Housing and Urban Development should
immediately implement section 957 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12714). Other Federal
agencies authorized to assist low-income families should take similar steps to encourage economic independence and the acciunulation
ofassets.
SEC. 924. ADMINISTRATIVE PROVISION.

Subject to the availability of appropriations for this purpose,
the Secretary of Housing and Urban Development shall cancel
the indebtedness of the town of McLain, Mississippi, relating to
the public facilities loan (Project No. MS 94-PFL39456). The town
of McLain, Mississippi, is relieved of all liabilitv to the Government
for the outstanding principal balance on such loan, for the amount
of accrued interest on such loan, and for any other fees and charges
payable in connection with such loan.
42 u s e 3536.

SEC. 925. PERFORMANCE GOALS.
(a) PERFORMANCE GOALS FOR THE DEPARTMENT OF HOUSING
AND URBAN DEVELOPMENT.—

(1) IN GENERAL.—^The Secretary of the Department of Housing and Urban Development (hereafter in this Act referred
to as the "Secretarjr") may establish performance goals for

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3885

the msgor programs of the Department of Housmg and Urban
Development in order to measure progress towards meetmg
the objectives of national housing policy.
(2) FORM OF GOALS.—^The performance goals referred to
in paragraph (1) shall be expressed in terms sufficient to measure progress.
(3) REPORT.—^The Secretary shall include in the Secretary's
annual report to the Congress a description of the progress
made in attsdning the performance goeds for each program,
citing the results achieved in each program for the previous
year.
(4) FAILURE TO MEET GOALS.—^If a performance standard
or goal has not been met, the description under paragraph
(3) shall include an explanation of why the goal was not met,
propose plans for achieving the performance goal, and recommend any legislative or regulatory changes necessary for
achievement of the goal.
(b) PERFORMANCE GOALS FOR THE FARMERS HOME ADMINISTRA- 42 use i47i
TION.—
"°^(1) IN GENERAL.—^The Secretary of Agriculture may establish performance goals for the mtgor housing programs of the
Farmers Home Administration in order to measure progress
towards meeting the objectives of national housing policy.
(2) FORM OF GOALS.—^The performance g0£ds referred to
in paragraph (1) shall be expressed in terms sufficient to measure progress.
(3) REPORT.—^The Secretarv of Agriculture shall prepare
a report to the Congress on tne progress made in attaining
the performance goals for each program, citing the actual
results achieved in such program for the previous year.
(4) FAILURE TO MEET GOALS.—^If a performance standcurd
or goal has not been met, the report under paragraph (3)
shall include an explanation of why the goal was not met,
propose plans for achieving the performance goal, and recommend any legislative or regulatory changes necessary for
achievement of the goal.
SEC. 928. REGULATION OF CONSULTANTS.
Section 13(fXl) of the Department of Housing and Urban Development Act (42 U.S.C. 3537b(f)(l)) is amended by striking "authority", "State", and "local government", and by a:ddlng immediately
before the period at the end the following: ", but does not include
a State or local government, or the officer or employee of a State
or local government or housing finance agency thereof who is
engaged in the official business of the State or local government".
SEC. 927. CLARIFICATION ON UnUTY ALLOWANCEa
42 USC 8624
(a) EUGIBIUTY.—Tenants who—

(1) are responsible for making out-of-pocket payments for
utility bills; and
(2) receive energy assist£Uice through utility allowances
that include energy costs under programs identified in subsection (c);
shall not have their eligibility or benefits under other programs
designed to assist low-income people wil^ increases in energy costs
since 1978 (including but not limited to the Low-Income Home
Energy Assistance Program) reduced or eliminated.

^°^'

106 STAT. 3886

PUBLIC LAW 102-550—OCT. 28, 1992
(b)

EQUAL TREATMENT IN BENEFIT PROGRAMS.—Tenants

described in subsection (a) shall be treated identically with otiier
households eligible for such assistance, includinyg^ in the determination of the home energy costs for which they are individuidly responsible and in the determination of their incomes.
(c) APPLICABILITY.—^This section applies to programs under the
United States Housing Act of 1937, the National Housing Act,
section 101 of the Housing and Urban Development Act of 1965,
section 202 of the Housing Act of 1959, and title V of the Housing
Act of 1949.
SEC. »28. FLOOD CONTROL RESTORATION ZONE.

42 use 4014.

Section 1307 of the National Flood Insurance Act of 1968 is
amended by adding at the end the following new subsection:
"(f) Notwithstanding any other provision of law, this subsection
shall only applv in a commimity which has been determined by
the Director of the Federal Emergency Management Agency^ to
be in the process of restoring flood protection afforded by a flood
protection system that had been previously accredited on a Flood
Insurance Rate Map as providing 100-year frequency flood protection but no longer does so. Except as provided in mis subsection,
in such a commimity, flood insurance shall be made available
to those properties impacted by the disaccreditation of the flood
protection system at premium rates that do not exceed those which
would be applicable to any property located in an area of special
flood hazard, the construction of which was started prior to the
effective date of the initial Flood Insurance Rate Map published
by the Director for the community in which such property is located.
A revised Flood Insurance Rate Map shall be prepared for the
commimity to delineate SLB Zone AR the areas of special flood
hazard that result from the disaccreditetion of the flood protection
system. A community will be considered to be in the process of
restoration if—
"(1) the flood protection system has been deemed restorable
by a Federal agency in consultetion with Uie local project
sponsor;
"(2) a minimum level of flood protection is still provided
to the community by the disaccredited system; and
''(3) restoration of the flood protection system is scheduled
to occur within a designated time period and in accordance
with a progress plan negotiated between the community and
the Federal Emergency Management Agency.
Communities that the Director of the Federal Emergency Management Agency determines to meet the criteria set forth in paragraphs
(1) and (2) as of January 1, 1992, shall not be subject to revised
Flood Insurance Rate Maps that contravene the intent of this
subsection. Such communities shall remain eligible for C zone rates
for properties located in zone AR for any policy written prior to
promulgation of final regulations for this section. Floodplain
management criteria for such communities shall not require the
elevation of improvements to existing structures and shall not
exceed 3 feet above existing grade for new construction, provided
the base flood elevation based on the disaccredited flooa control
system does not exceed five feet above existing ^ade, or the remaining new construction in such communities is limited to infill sites,
rehabilitetion of existing structures, or redevelopment of previously
developed areas.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3887

The Director of the Federal Emergency Management Agency shall Regulations.
develop and promulgate regulations to implement this subsection,
including minimum floodplain management criteria, within 24
months after the date of enactment of this subsection.".
SEC. 929. SALARIES AND EXPENSES.

Section 7 of the Department of Housing and Urban Development Act (42 U.S.C. 3535) is amended by inserting at the end
the following new subsection:
"(sXD Notwithstanding any other provision of law, there is Appropriation
authorized to be appropriated for salaries and expenses to carry authorization.
out the purposes of this section $988,000,000 for fiscal year 1993
and $1,029,496,000 for fiscal year 1994.
''(2) Of the amoimts authorized to be appropriated by this
section, $96,000,000 shall be avedlable for each of the fiscal years
1993 and 1994, which amounts shall be used to provide staff in
regional, field, or zone offices of the Department of Housing and
Urban Development to review, process, approve, and service applications for mortgage insurance under title II of the National Housing
Act for housing consisting of 5 or more dwelUng units.
''(3) Of the amounts authorized to be appropriated to carry
out this section, not less than $5,000,000 of such amount shall
be available for each fiscal year exclusively for the purposes of
provicting ongoing training and capacity building for Department
personnel.**.
SEC. 930. THE NATIONAL CITIES IN SCHOOLS COMMUNITY DEVELOPMENT PROGRAM.

(a) PURPOSE.—^The purposes of this section are—
(1) to empower the local community by investing in its
human capital through a private-public partnership to rebuild
urban emd rural communities through schools and other
community organizations, including public housing communities; and
(2) to ensure that by December 1997, the Cities in Schools
Program, through the National Center for Partnership Development, will have developed the capacity to reach 500,000 atrisk youth and their families through community-wide
programs that channel existing commimity resources to provide
personal, coordinated and accountable support.
(b) GRANTS TO STRENGTHEN THE NATIONAL CITIES IN SCHOOLS

PROGRAM.—^The Secretary of Housing and Urban Development shall
make grants to expand the National Cities in Schools Program
and operations of the National Center for Partnership Development
to—
(1) develop, estabUsh, and support projects to strengthen
local community dropout prevention programs in elementary
and secondary schools;
(2) train community leaders responsible for the
implementation of local community Cities in Schools dropout
prevention programs; and
(3) disseminate to, and support replication by, States and
communities of effective dropout prevention strategies.
(c) AUTHORIZATION.—^There are authorized to be appropriated Appropriation
to carry out this section $10,000,000 for fiscal year 1993 and authorization.
$10,420,000 for fiscal year 1994.

106 STAT. 3888

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 931. BANK ENTERPRISE ACT OF 1991 AND RELATED PROVISIONS.
(a) ASSESSMENT RATE FOR LIFELINE ACCOUNT DEPOSITS.—Sec-

tion 7(bX10) of the Federal Deposit Insurance Act (12 U.S.C.
1817(bX10)) (as added by section 232(b)(2) of the Bank Enterprise
Act of 1991) is amended by striking "at the assessment rate of
V2 the m£iximum rate." and inserting "at an assessment rate to
be determined by the Corporation by regulation. Such assessment
rate may not be less than V2 the maximum assessment rate.".
(b) ASSESSMENT PROCEDURE.—Section 7(bX2XAXiiiXI) of the
12 u s e 1817.

Federal Deposit Insurance Act (12 U.S.C. 1917(bX2XAXiiiXI)) (as
added by section 232(b)(3XC) of the Bank Enterprise Act of 1991)
is amended to read as follows:
"(I) the assessment rate determined by the
Corporation pursuant to paragraph (10) with
respect to such semiannual period; and".

12 u s e 1834a.

233(aX2) of the Bank Enterprise Act of 1991 (12 U.S.C. 1934a(aX2))
is amended to read as follows:
"(2) QUALIFYING ACTIVITIES.—An insured depository institution shall be eligible for any community enterprise assessment
credit for any semiannual period for—
"(A) the amount, during such period, of new originations of qualified loans and other financial assistance provided for low- and moderate-income persons in distressed
communities, or enterprises integrally involved with such
neighborhoods, which the Board determines are qualified
to be taken into account for purposes of this subsection;
and
"(B) the amount, during such period, of deposits
accepted from persons domiciled in the distressed community, at any office of the institution (including any branch)
located in any qualified distressed community, and new
originations of any loans and other financial assistance
made within that community, except that in no case shall
the credit for deposits at any institution or branch exceed
the credit for loans and other financial assistance by the
bank or branch in the distressed commimity.".

12 u s e 1834a.

Bank Enterprise Act of 1991 (12 U.S.C. 1934a(aX3)) is amended
to read as follows:

(c) QUALIFYING ACTIVITIES FOR ASSESSMENT CREDITS.—Section

(d) AMOUNT OF ASSESSMENT CREDIT.—Section 233(aX3) of the

"(3) AMOUNT OF ASSESSMENT CREDIT.—The amount of any

community enterprise assessment credit available under section
7(dX4) of the Federal Deposit Insurance Act for any insured
depository institution, or a qualified portion thereof, shall be
the amount which is equal to 5 percent, in the case of an
institution which does not meet the community development
organization requirements under section 234, and 15 percent,
in the case of an institution, or a qualified portion thereof,
which meets such requirements (or any percentage designated
under paragraph (5)) of—
"(A) for the first full semiannual period in which
commimity enterprise assessment credits are available, the
sum of—
"(i) the amounts of assets described in paragraph
(2)(A); and
"(ii) the amounts of deposits, loans, and other
financial assistance described in paragraph (2XB); and

PUBLIC LAW 102-550—OCT. 28, 1992
of—

106 STAT. 3889

"(B) for any subsequent semiannual period, the sum

"(i) anv increase during such period in the amount
of assets described in paragraph (2XA) that has been
deemed eligible for crecut by the Board; and
"(ii) any increase during such period in the
amounts of deoosits, loans, and other miancial assistance described in paragraph (2XB) that has been
deemed eligible for credit by the Board.",
(e) EuGmiLiTY REQUIREMENTS FOR QUALIFIED DISTRESSED
COMMUNITIES.—Section 233(bX4) of the Bank Enterprise Act of
1991 (12 U.S.C. 1934a(bX4)) is amended to read as foUows:
12 use I834a.
"(4) EUGIBILITY REQUIREMENTS.—For purposes of this subsection, an area meets the requirements ot this paragraph
if the following criteria are met:
"(A) At least 30 percent of the residents residing in
the area have incomes which are less than the national
poverty level.
''(B) The unemployment rate for the area is IVb times
greater than the national average (as determined by the
Bureau of Labor Statistics' most recent figures).
"(C) Such additional eUgibiUty requirements as the
Board may, in its discretion, deem necessary to carry out
the provisions of this subtitle.".
SEC. 9S2. DISCLOSURES UNDER THE HOME MORTGAGE DISCLOSURE
ACT OF 1975.

(a) IN GENERAL.—Section 304 of the Home Mortgage Disclosure
Act of 1975 (12 U.S.C. 2803) is amended by adding at the end
the following new subsections:
**(j) LOAN APPUCATION REGISTER INFORMATION.—

"(1) IN GENERAL.—^In addition to the information required Regulations.
to be disclosed under subsections (a) and (b), any depository
institution which is required to make disclosures under this
section shall make available to the public, upon request, loan
application register information (as defined oy the Board by
regulation) in the form required under regulations prescribed
by the Board.
"(2) FORMAT OF DISCLOSURE.—
"(A) UNEDITED FORMAT.—Subject

to subparagraph (B),
the loan application register information described in paragraph (1) may be disclosed by a depository institution without editing or compilation and m the format in which
such information is maintained by the institution.
"(B) PROTECTION OF APPUCANT'S PRIVACY INTEREST.—

The Board shall require, by regulation, such deletions as Regulations.
the Board may determine to be appropriate to protect—
"(i) any privacy interest of any applicant, mcluding
the deletion of the applicant's name and identification
number, the date or the application, and the date of
any determination by the institution with respect to
such application; and
"(ii) a depository institution from liability under
any Federal or State privacy law.
"(C) CENSUS TRACT FORMAT ENCOURAGED.—It is the

sense of the Congress that a depository institution should
provide loan register information under this section in a

106 STAT. 3890
r .

^

PUBLIC LAW 102-550—OCT. 28, 1992
format based on the census tract in which the property
is located.
"(3) CHANGE OF FORM NOT REQUIRED.—A depository institution meets the disclosure requirement of paragraph (1) if the
institution provides the information re<)uired under such paragraph in the form in which the institution maintains such
information.
"(4) REASONABLE CHARGE FOR INFORMATION.—Any depository institution which provides information under this subsection may impose a reasonable fee for any cost incurred
in reproducing such information.
^(5) TIME OF DISCLOSURE.—The disclosure of the loan
application register information described in paragraph (1) for
any year pursuant to a request imder paragraph (1) shall
be made—
"(A) in the case of a request made on or before March
1 of the succeeding year, before April 1 of the succeeding
year; and
"(B) in the case of a request made after March 1
of the succeeding year, before the end of the 30-day period
beginning on the date the request is made.
"(6) RETENTION OF INFORMATION.—Notwithstanding subsection (c), the loan application register information described
in paragraph (1) for any year shall be maintained and made
available, upon request, for 3 years after the close of the 1st
year during which such information is required to be maintained and made available.
"(7) MINIMIZING COMPLIANCE COSTS.—In prescribing regulations under this subsection, the Board shall make every effort
to minimize the costs incurred by a depository institution in
complying with this subsection and such regulations.

? "(k) DISCLOSURE OF STATEMENTS BY DEPOSITORY INSTITUTIONS.—

"(1) IN GENERAL.—In accordance with procedures established by the Board pursuant to this section, any depository
institution required to make disclosures under this section—
"(A) snail make a disclosure statement available, upon
request, to the public no later than 3 business days after
the institution receives the statement from the Federal
Financial Institutions Examination Council; and
"(B) may make such statement available on a floppy
disc which may be used with a personal computer or in
. ^ any other media which is not prohibited imder regulations
prescribed by the Board.
"(2) NOTICE THAT DATA IS SUBJECT TO CORRECTION AFTER

FINAL REVIEW.—Any disclosure statement provided pursuant
to paragraph (1) shall be accompanied by a clear and conspicuous notice that the statement is subject to final review and
revision, if necessary.
"(3) REASONABLE CHARGE FOR INFORMATION.—^Any depository institution which provides a disclosure statement pursuant
to paragraph (1) may impose a reasonable fee for any cost
. incurred in providing or reproducing such statement.
"(1) PROMPT DISCLOSURES.—

"(1) IN GENERAL.—^Any disclosure of information pursuant
to this section or section 310 shall be made as promptly as
possible.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3891

"(2) MAXIMUM DISCLOSURE PERIOD.—

"(A) 6- AND 9-MONTH M XM M PERIODS.—Except as
AI U
provided in subsections (jX5) and (kXD and regulations
prescribed by the Board and subject to subparagraph (B),
any information required to be disclosed for any year beginning after December 31,1992, under—
"(i) this section shall be made available to the
public before September 1 of the succeeding year; and
'^(ii) section 310 shall be made available to the
public before December 1 of the succeeding year.
"(B) SHORTER PERIODS ENCOURAGED AFTER 1994.—With
respect to disclosures of information under this section
or section 310 for any year beginning after December 31,
1993, every effort shall be made—
"(i) to make information disclosed under this section available to the public before July 1 of the succeeding year; and
"(u) to make information required to be disclosed
imder section 310 available to the public before
September 1 of the succeeding year.
"(3) IMPROVED PROCEDURE.—The Federal Financial Institutions Examination Council shall make such changes in the
system established pursuant to subsection (0 as may be necessary to carry out the requirements of this subsection.".
(b) TECHNICAL AND CONFORMING AMENDMENT.—Section 304(c)
of the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2803(c))
is amended by inserting ", other than loan application register
information under subsection (j)," after "under this section".
(c) EFFECTIVE DATE.—^The amendments made by subsections 12 use 2803
(a) and (b) shall apply with respect to information disclosed under "°^'
section 304 of the Home Mortgage Disclosure Act of 1975 for any
year which ends after the date oftiieenactment of this Act.
SEC. 933. PROHIBITION ON USE OF '*RULE OF IffiT IN CONNECTION 15 USC 1615.
WITH MORTGAGE REFINANCINGS AND OTHER CONSUMER
LOANS.
(a) PROMPT REFUND OF UNEARNED INTEREST REQUIRED.—

(1) IN GENERAL.—^If a consumer prepays inftdlthe financed
amount under any consumer credit transaction, the creditor
shall promptly refund any unearned portion of the interest
charge to the consumer.
(2) EXCEPTION FOR REFUND OF DE MINIMUS AMOUNT.—NO

refund shall be required under paragraph (1) with respect
to the prepayment of any consumer credit transaction if the
total amount of the refund would be less than $1.
(3) APPUCABILITY TO REFINANCED TRANSACTIONS AND
ACCELERATION BY THE CREDITOR.—This subsection shall apply

with respect to any prepa3rment of a consumer credit transaction described in paragraph (1) without regard to the manner
or the reason for the prepayment, including—
(A) any prepayment made in connection with the
refinancing, consoUdation, or restructuring of the transaction; and
(B) any prepayment made as a result of the acceleration of the obligation to repay the amount due with respect
to the transaction.

106 STAT. 3892

PUBLIC LAW 102-550—OCT. 28, 1992

(b) USE OF *TIULE OF 78'S" PROHIBITED.—For the purpose of
calculating any refund of interest required under subsection (a)
for any precomputed consumer credit transaction of a term exceeding 61 months which is consummated after September 30, 1993,
the creditor shall compute the refund based on a method which
is at least as favorable to the consumer as the actuarial method.
(c) STATEMENT OF PREPAYMENT AMOUNT.—

(1) IN GENERAL.—^Before the end of the 5-day period beginning on the date an oral or written request is received by
a creditor from a consumer for the disclosure of the amount
due on any precomputed consumer credit account, the creditor
or assignee shall provide the consumer with a statement of—
(A) the £unount necessary to prepay the account in
full; and
(B) if the amount disclosed pursuant to subparagraph
(A) includes an amount which is required to be refmided
under this section with respect to such prepayment, the
amount of such refund.
(2) WRITTEN STATEMENT REQUIRED IF REQUEST IS IN WRIT-

ING.—^If the customer's request is in writing, the statement
under paragraph (1) shall be in writing.
(3) 1 FREE ANNUAL STATEMENT.—A consumer shall be entitled to obtain 1 statement under paragraph (1) each year without charge.
(4)

ADDITIONAL STATEMENTS SUBJECT TO REASONABLE

FEES.—^Any creditor may impose a reasonable fee to cover the
cost of providing any statement under paragraph (1) to any
consumer in addition to the 1 free annual statement required
under paragraph (3) if the amount of the charge for such
additional statement is disclosed to the consumer before furnishing such statement.
(d) DEFiNrnONS.—^For the purpose of this section—
(1) ACTUARIAL METHOD.—The term "actuarial method"
means the method of allocating payments made on a debt
between the amount financed and uie finance charge pursuant
to which a pa3anent is applied first to the accumulated finance
charge and any remainder is subtractedfirom,or any deficient^
is added to, the unpaid balance of the amount financed.
(2) CONSUMER, CREDIT.—^The terms "consumer" and "creditor" have the meanings given to such terms in section 103
of the Consumer Credit Protection Act.
(3) CREDITOR.—The term "creditor"—
(A) has the meaning given to such term in section
103 of the Consumer Cremt Protection Act; and
(B) includes any assignee of any creditor with respect
to credit extended in connection witii any consumer ci^dit
transaction and any subsequent assignee with respect to
such credit.

Subtitle B—^Bank Regulatory Clarification
Provisions
SEC. 951. AMENDMENT RELATING TO ESTIMATES OF REAL ESTATE
S E T T L E M E N T COSTS.

Section 5(d) of the Real Estate Settlement Procedures Act of
1974 (12 U.S.C. 2604(d)) is amended by striking the last sentence

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3893

and inserting "Such booklet shall be provided by delivering it or
>lacing it in the mail not later than 3 business days after the
ender receives the appUcation, but no booklet need be provided
if the lender denies the application for credit before the end of
the 3-day period.".

1

SEC. 962. ADJUSTABLE RATE MORTGAGE CAPa
Section 1204(dX2) of the Competitive Ek)uality Banking Act
of 1987 (12 U.S.C. 3806(dX2)) is amended by striking "any loan"
and inserting "any consumer loan".
SEC. 968. MODIFYING SEPARATE CAPITALIZATION RULE FOR SAVINGS
ASSOCIATIONS' SUBSIDIARIES ENGAGED IN ACnVITIES
NOT PERMISSIBLE FOR NATIONAL BANKS.
(a) IN GENERAL.—Section 5(tX5XD) of the Home Owners' Loan
Act (12 U.S.C. 1464(tX5XD)) is amended by redesignating clause
(iii) as clause (ix) and by inserting after clause (ii) the following
new clauses:
"(iii) AGENCY DISCRETION TO PRESCRIBE GREATER
PERCENTAGE.—Subject to clauses (iv), (v), and (vi), the
Director may prescribe by order, with respect to a
particular qualified savings association, an applicable
percentage greater than that provided in clause (ii)
if the Director determines, in the Director's sole discretion, that the use of the greater percentage, imder
the circiunstances—
"(I) would not constitute an unsafe or unsound
practice;
"(II) would not incre£ise the risk to the affected
deposit insurance fund; and
"(III) would not be likely to result in the
association's being in an unsafe or unsound condition,
"(iv) SUBSTANTIAL COMPLIANCE WITH APPROVED
CAPITAL PLAN.—In the case of a savings association
which is subject to a plan submitted under paragraph
(7XD) of this subsection or an order issued under this
subsection, a directive issued or plan approved under
subsection (s), or a capital restoration plan approved
or order issued under section 38 or 39 of the Federal
Deposit Insurance Act, an order issued under clause
(iii) with respect to the association shall be effective
only so long as the association is in substantial compUance with such plan, directive, or order.
"(v) LIMITATION ON INVESTMENTS TAKEN INTO
ACCOUNT.—^In prescribing the amount by which an
applicable percentage under clause (iii) mav exceed
the applicable percentage under clause (ii) with respect
to a particular qualified savings association, the Director may take into account only the sum of—
"(I) the association's investments in, and
extensions of credit to, the subsidiary that were
made on or before April 12,1989; and
"(II) the association's investments in, and
extensions of credit to, the subsidiary that were
made after April 12, 1989, and were necessary
to complete projects initiated before April 12,1989.

106 STAT. 3894

PUBLIC LAW 102-550—OCT. 28, 1992
'X\i) LIMIT.—^The applicable percentage limit
allowed by the Director in an order under clause (iii)
shall not exceed the following limits:

T o r the followinf period:
Prior to July 1, 1994
July 1,1994 through June 30,1995
July 1, 1995 through June 30,1996
After June 30,1996
"(vii) CRITICALLY

The limit is:
75 percent
60 percent
40 percent
0 percent
UNDERCAPITALIZED msTiru-

TION.—^In the case of a savings associat oii that
becomes critically undercapitalized (as define! in section 38 of the Federal Deposit Insurance Act) VM determined imder this subparagraph without tipplying
clause (iii), clauses (iii) through (v) shall be applied
by substituting 'Corporation' for IDirector* eac'i place
such term appears.
"(viii) QUAUFIED SAVINGS ASSOCIATION DEFINED.—

/

/

For purposes of clause (iii), the term 'qualified savings
association' means an eligible savings associatian (as
defined in paragraph (3)tB)) which is subject to this
paragraph solely because of the real estate investments
or other real estate activities of the association's
subsidiary, and—
"(I) is adequately capitalized (as defined in
section 38 of the Federal Deposit Insurance Act);

°'
"(11) is in compliance with an approved capital
restoration plan meeting the requirements of section 38 of the Federid Deposit Insurance Act, and
is not critically undercapitalized (as defined in
such section).",
(b) TECHNICAL AND CONFORMING AMENDMENT.—Clause (ix) of

section 5(tX5XD) of the Home Owners' Loan Act (12 U.S.C.
1464(tX5XD)) (as so redesignated by subsection (a) of this section)
is amended by inserting "or prescribed under clause (iii)" after
"clause (ii)".
SEC. 964. REAL ESTATE A P P R A I S A L AMENDMENT.

Section 1112 of the Financial Institution Reform, Recovery,
and Enforcement Act of 1989 (12 U.S.C. 3341) is amended—
(1) by striking "Each Federid financial institutions" and
inserting "(a) IN GENERAL.—^Each Federal financial institutions"; and
(2) by adding at the end the following new subsections:
"(b) TilRESHOLD LEVEL.—^Each Federal financial institutions
regulatory agency and the Resolution Trust Corporation may establish a threshold level at or below which a certified or ucensed
appraiser is not required to perform appraisals in connection with
f^erally related transactions, if such agency determines in writing
that such threshold level does not represent a threat to the safety
and soundness offinancialinstitutions.
"(c) GAO STUDY OF APPRAISALS IN CONNECTION WITH REAL
ESTATE RELATED FINANCIAL TRANSACTIONS BELOW THE THRESHOLD
LEVEL.—
"(1) STUDY REQUIRED.—At the end of the 18-month period,

and the end of the 36-month period, beginning on the date
of the enactment of this subsection, the Comptroller General

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3895

of the United States shall conduct a study on the adequacy
and quality of appraisals or evaliiations conducted in connection
with real estate related financial transactions below the threshold level estabUshed under subsection (b), taking into account—
"(A) the cost to any financial institution involved in
any such transaction;
"(B) the possibility of losses to the Bank Insurance
Fund, the Savings Association Insurance Fund, or the
National Credit Union Share Insurance Fund;
"(C) the cost to any customer involved in any such
transaction; and
"(D) the effect on low-income housing.
"(2) REPORTS TO CONGRESS AND THE APPROPRIATE FEDERAL
FINANCIAL
INSTITUTIONS
REGULATORY AGENCIES.—UPON

completing each of the studies required under paragraph (1),
the Comptroller General shall submit a report on the Comptroller General's findings and conclusions with respect to such
study to the Federal financial institutions regulatory agencies,
the Committee on Banking, Finance and Urban Affairs of the
House of Representatives, and the Committee on Bcuiking,
Housing, and Urban Affairs of the Senate, together with such
reconmiendations for legislative or administrative action as the
Comptroller General determines to be appropriate.".
SEC. 955. INSIDER LENDING.
(a) AUTHORITY TO MAKE EXCEPTIONS TO DEFINITION OF EXTENSION OF CREDIT.—Section 22(hX9XD) of the Federal Reserve Act

(12 U.S.C. 375b(hX9XD)) is amended—
(1) bv striking "(D) EXTENSION OF CREDIT.—A member
bank" and inserting the following:
"(D) EXTENSION OF CREDIT.—
"(i) IN GENERAL.—A member bank";

and
(2) by adding at the end the following new clause:
"(ii) EXCEPTIONS.—The Board may, by regulation,

make exceptions to clause (i) for transactions that the
Board determines pose minimal risk.".
(b) PRINCIPAL SHAREHOLDER DEFINED.—Section 22(hX9XF) of
the Federal Reserve Act (12 U.S.C. 375b(hX9XF)) is amended—
(1) by striking "shareholder* means any person" and inserting "shareholder*—
"(i) means any person";
(2) by striking the period at the end of clause (i) (as
so redesignated by paragraph (1) of this subsection) and inserting "; ancT; and
(3) by adding at the end the following new clause:
"(ii) does not include a company of which a member
bank is a subsidiary.".
SEC. »5e. CLARIFICATION OF COMPENSATION STANDARDS.

Section 39 of the Federal Deposit Insurance Act (as added
by section 132(a) of Federal Deposit Insurance Corporation Improvement Act of 1991) (12 U.S.C. 1831s) is amended—
(1) by striking subsection (d) and inserting the following
new subsection:
"(d) STANDARDS TO BE PRESCRIBED BY REGULATION.—

"(1) IN GENERAL.—Standards under subsections (a), (b),
and (c) shall be prescribed by regulation. Such regulations
may not prescribe standards that set a specific level or range

59-194 O—93

9 : QL 3 (Pt. 5)

106 STAT. 3896

PUBLIC LAW 102-550—OCT. 28, 1992
of compensation for directors, officers, or employees of insured
depository institutions.
"(2) APPLICABILITY OF OTHER LAWS.—Paragraph (1) shall

not affect the authority of any appropriate Federal banking
agency to restrict the level of compensation, including golden
parachute pajnnents (as defined in section 18(kX4)), paid to
any director, officer, or employee of an insured depository
institution under any other provision of law.
"(3) SENIOR EXECUTIVE OFFICERS AT UNDERCAPITALIZED

INSTITUTIONS.—Paragraph (1) shall not affect the authority of
any appropriate Federal banking agency to restrict compensation paid to any senior executive officer of an undercapitalized
insured depository institution pursuant to section 38.
"(4) SAFETY AND SOUNDNESS OR ENFORCEMENT ACTIONS.—

Paragraph (1) shall not be construed as affecting the authority
of any appropriate Federal banking agency tinder any provision
of this Act other than this section, or imder any other provision
of law, to prescribe a specific level or range of compensation
for any director, officer, or employee of an insured oepository
institution—
"(A) to preserve the safety and soundness of the institution; or
"(B) in connection with any action under section 8
or any order issued by the agency, any agreement between
the agency and the institution, or any condition imposed
by the agency in connection with the agency's approval
of an application or other request by the institution, which
is enforceable under section 8."; and
(2) in subsection (eXlXA), by striking "(a), (b), or (c)" and
inserting "(a) or (b)".
SEC.ft57.TRUTH IN SAVINGS ACT AMENDMENTS.
(a) ON-PREMISES DISPLAYS.—Section 263 of the Truth in Sav-

ings Act (12 U.S.C. 4302) is amended—
(1) in subsection (a), by striking "subsection (b)" and inserting "subsections (b) and (c)";
(2) by redesignating subsections (c) and (d) as subsections
(d) and (e), respectively; and
(3) by inserting after subsection (b) the following new subsection:
"(c) DISCLOSURE REQUIRED FOR ON-PREMISES DISPLAYS.—

"(1) IN GENERAL.—^The disclosure requirements contained
in this section shall not apply to any sign (including a rate
board) disclosing a rate or rates of interest which is displayed
on the premises of the depository institution if such sign
contains—
"(A) the accompanying annual percentage yield; and
"(B) a statement that the consumer should request
further information from an employee of the depository
institution concerning the fees and terms applicable to
the advertised accoimt
"(2) DEFINITION.—For purposes of paragraph (1), a sign
shall only be considered to be displayed on the premises of
a depository institution if the sign is designed to be viewed
only from the interior of the premises of the depository institution.".

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3897

(b) EFFECTIVE DATE OF REGULATIONS.—Section 269(aX2) of the
Truth in Savings Act (12 U.S.C. 4308(aX2)) is amended by striking
"6 months" and inserting "9 months'*.

TITLE X—RESroENTIAL LEAD-BASED
PAINT HAZARD REDUCTION ACT OF
1992

Residential
Lead-Based
Paint Hazard
Reduction Act of
1992.

SEC. 1001. SHORT TITLE.

42 u s e 4851
note.

This title may be cited as the "Residential Lead-Based Paint
Hazard Reduction Act of 1992".
SEC. 1002. FINDINGS.

42 u s e 4851.

The Congress finds that—
(1) low-level lead poisoning is widespread among American
children, afflicting as many as 3,000,000 children under age
6, with minority and low-income communities disproportionately affected;
(2) at low levels, lead poisoning in children causes intelligence quotient deficiencies, reading and learning disabilities,
impaired hearing, reduced attention span, hyperactivity, and
benavior problems;
(3) pre-1980 American housing stock contains more than
3,000,000 tons of lead in the form of lead-based paint, with
the vast majority of homes built before 1950 containing substantial amounts of lead-based paint;
(4) the ingestion of household dust containing lead from
deteriorating or abraded lead-based paint is the most common
cause of lead poisoning in children;
(5) the health and development of children living in as
many as 3,800,000 American homes is endangered by chipping
or peeling lead paint, or excessive amounts of lead-contaminated dust in their homes;
(6) the danger posed by lead-based psdnt hazards can be
reduced by abating lead-based paint or by taking interim measures to prevent paint deterioration and limit children's exposure
to lead dust and chips;
(7) despite the enactment of laws in the early 1970's requiring the Federal Government to eliminate as far as practicable
lead-based paint hazards in federally owned, assisted, and
insured housing, the Federcd response to this national crisis
remains severelv limited; and
(8) the Federal Government must take a leadership role
in building the infrastructure—^including an informed public.
State and local delivery systems, certifi^ inspectors, contractors, and laboratories, trained workers, and available financing
and insurance—necessary to ensure that the national goal of
eliminating lead-based paint hazards in housing can be
achieved as expeditiously as possible.
SEC. 1003. PURPOSES.

The purposes of this Act are—
(1) to develop a national strategy to build the infrastructure
necessary to eliminate lead-based paint hazards in all housing
as expeditiously as possible;

42 u s e 4851a.

106 STAT. 3898

PUBLIC LAW 102-550—OCT. 28, 1992
(2) to reorient the national approach to the presence of
lead-based paint in housing to implement, on a priority basis,
a broad program to evaluate and reduce lead-based pamt hazards in the Nation's housing stock;
(3) to encourage effective action to prevent childhood lead
poisoning by establishing a workable framework for lead-based
paint hazard evaluation and reduction and by ending the current confusion over reasonable standards of care;
(4) to ensure that the existence of lead-based paint hazards
is taken into account in the development of Government housing policies and in the sale, rental, and renovation of homes
and apartments;
(5) to mobilize national resources expeditiously, through
a partnership among all levels of government and me private
sector, to develop the most promising, cost-effective methods
for evaluating and reducing lead-based paint hazards;
(6) to reduce the threat of chilonood lead poisoning in
housing owned, assisted, or transferred by the Federal Government; and
(7) to educate the public concerning the hazards and
sources of lead-based paint poisoning and steps to reduce and
eliminate such hazards.

42 u s e 4851b.

SEC. 1004. DEFINITIONS.

For the purposes of this Act, the following definitions shall
apply:
(1) ABATEMENT.—^The term "abatement" means any set of
measures designed to permanently eliminate lead-based paint
hazards in accordance with standards established by appropriate Federal agencies. Such term includes—
(A) the removal of lead-bsised paint and lead-contaminated dust, the permanent containment or encapsulation
of lead-based paint, the replacement of lead-painted surfaces or fixtures, and the removal or covering of lead
contaminated soil; and
(B) all preparation, cleanup, disposal, and
postabatement clearance testing activities associated with
such measures.
(2) ACCESSIBLE SURFACE.—The term "accessible surface"
means an interior or exterior surface painted with lead-based
paint that is accessible for a yoimg cnild to mouth or chew.
(3) CERTIFIED CONTRACTOR.—^The term "certified contractor" means—
(A) a contractor, inspector, or supervisor who has completed a training program certified by the appropriate Federal agency and has met any other requirements for certification or licensure established by such agency or who has
been certified by any State through a program which has
been foimd by such Federal agency to be at least as rigorous
as the Federal certification program; and
(B) workers or designers who have fully met training
requirements established by the appropriate Federsu
agency.
(4) CONTRACT FOR THE PURCHASE AND SALE OF RESIDENTIAL

REAL PROPERTY.—^The term "contract for the purchase and sale
of residential real property" means any contract or agreement
in. which one party agrees to purchase an interest in real

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3899

property on which there is situated 1 or more residential dwellings used or occupied, or intended to be used or occupied,
in whole or in part, as the home or residence of 1 or more
persons.
(5) DETERIORATED PAINT.—The term "deteriorated paint"
means any interior or exterior paint that is peeling, chipping,
chalking or cracking or any paint located on an interior or
exterior surface or fixture that is damaged or deteriorated.
(6) EVALUATION.—^The term "evaluation" means risk assessment, inspection, or risk assessment and inspection.
(7) FEDERALLY ASSISTED HOUSING.—Tjie term "federally
assisted housing" means residential dwellings receiving projectbased assistance under programs including—
(A) section 221(dX3) or 236 of the National Housing
Act;
(B) section 1 of the Housing and Urban Development
Act of 1965;
(C) section 8 of the United States Housing Act of
1937; or
(D) sections 502(a), 504, 514, 515, 516 and 533 of
the Housing Act of 1949.
(8) FEDERALLY OWNED HOUSING.—The term "federally
owned housing" means residential dwellings owned or managed
by a Federal agency, or for which a Federal agency is a trustee
or conservator. For the purpose of this paragraph, the term
"Federal agencjr" includes the Department of Housing and
Urban Development, the Farmers Home Administration, the
Resolution Trust Corporation, the Federal Deposit Insurance
Corporation, the General Services Administration, the Department of Defense, the Department of Veterans Affairs, the
Department of the Interior, the Department of Transportation,
and any other Federal agency.
(9) FEDERALLY SUPPORTED WORK.—The term "federally supported work" means any lead hazard evaluation or reduction
activities conducted in federally owned or assisted housing or
funded in whole or in part through any financial assistance
program of the Department of Housing and Urban Development, the Farmers Home Administration, or the Department
of Veterans Affairs.
(10) FRICTION SURFACE.—The term "friction surface" means
an interior or exterior surface that is subject to abrasion or
friction, including certain window, floor, and stair surfaces.
(11) IMPACT SURFACE.—^The term "impact surface" means
an interior or exterior surface that is subject to damage by
repeated impacts, for example, certain parts of door frames.
(12) INSPECTION.—^The term "inspection" means a surfaceby-surface investigation to determine the presence of lead-based
paint as provided in section 302(c) of tne Lead-Based Paint
Poisoning Prevention Act and the provision of a report explaining the results of the investigation.
(13) INTERIM CONTROLS.—The term "interim controls"
means a set of measures designed to reduce temporarily human
exposure or likely exposure to lead-based paint hazards, including specialized cleaning, repairs, maintenance, painting, temporary containment, ongoing monitoring of lead-based paint
hazards or potential hazards, and the establishment and operation of management and resident education programs.

106 STAT. 3900

PUBLIC LAW 102-550—OCT. 28, 1992
(14) LEAD-BASED PAINT.—The term lead-based paint"
means paint or other surface coatings that contain lead in
excess of limits established under section 302(c) of the LeadBased Paint Poisoning Prevention Act.
(15) LEAD-BASED PAINT HAZARD.—The term "lead-based
>aint hazard" means any condition that causes exposure to
ead from lead-contaminated dust, lead-contaminated soil, leadcontaminated paint that is deteriorated or present in accessible
surfaces, friction surfaces, or impact surfaces that would result
in adverse human health effects as established by the appropriate Federal agency.
(16) LEAD-CONTAMINATED DUST.—The term "lead-contaminated dust" means surface dust in residential dwellings that
contains an area or mass concentration of lead in excess of
levels determined by the appropriate Federal agency to pose
a threat of adverse health effects in pregnant women or young
children.
(17) LEAD-CONTAMINATED SOIL.—^The term "lead-contaminated soil" means bare soil on residential real property that
contains lead at or in excess of the levels determined to be
hazardous to himian health by the appropriate Federal agency.
(18) MORTGAGE LOAN.—^The term "mortgage loan" includes
any loan (other than temporary financing such as a construction
loan) that—
(A) is secured by a first lien on any interest in residential real property; and
(B) either—
(i) is insured, guaranteed, made, or assisted by
the Department of Housing and Urban Development,
the Department of Veterans Affairs, or the Farmers
Home Administration, or by any other agency of the
Federal (lovemment; or
(ii) is intended to be sold by each originating mortgage institution to any federally chartered secondary
mortgage market institution.
(19) ORIGINATING MORTGAGE INSTITUTION.—The term
"originating mortgage institution" means a lender that provides
mortgage loans.
(20) PRIORITY HOUSING.—The term "priority housing"
means target housing that qualifies as afTordable housing under
section 215 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12745), including housing that receives
assistance under subsection (b) or (o) of section 8 of the United
States Housing Act of 1937 (42 U.S.C. 1437fi:b) or (o)).
(21) PUBLIC HOUSING.—The term "public housing" has the
same meaning given the term in section 3(b) of the United
States Housing Act of 1937 (42 U.S.C. 1437a(bXl)).
(22) REDUCTION.—^The term "reduction" means measures
designed to reduce or eliminate human exposure to lead-based
paint hazards through methods including interim controls and
abatement.
(23) RESIDENTL\L DWELLING.—^The term "residential dwelling" means—
(A) a single-family dwelling, including attached structures such as porches and stoops; or
(B) a single-family dwelling imit in a structure that
contains more than 1 separate residential dwelling imit,

{

/

/
/
/

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3901

and in which each such unit is used or occupied, or intended
to be used or occupied, in whole or in pcurt, as the home
or residence of 1 or more persons.
(24) REsroENTiAL REAL PROPERTY.—The term "residential
real property^ means real property on which there is situated
1 or more residential dwellings used or occupied, or intended
to be used or occupied, in whole or in part, as the home
or residence of 1 or more persons.
(25) RISK ASSESSMENT.—^The term "risk assessment" means

an on-site investigation to determine and report the existence,
nature, severity and location of lead-based paint hazards in
residential dwellings, including—
(A) information gathering regarding the age and history of the housing and occupancy by children under age
6;
(B) visual inspection;
(C) limited wipe sampling or other environmental sampling techniques;
(D) other activity as may be appropriate; and
(E) provision of a report explaining the results of the
investigation.
(26) SECRETARY.—The term "Secretary" means the Secretary of Housing and Urban Development.
(27) TARGET HOUSING.—The term "target housing" means
any housing constructed prior to 1978, except housing for the
eloerly or persons with disabilities (unless any child who is
less than 6 years of age resides or is expected to reside in
such housing for the elderly or persons with disabilities) or
any 0-bedroom dwelling. In the case of jurisdictions which
banned the sale or use of lead-based paint prior to 1978, the
Secretary, at the Secretary's discretion, may designate an earlier date.

Subtitle A—Lead-Based Paint Hazard
Reduction
SEC. 1011. GRANTS FOR LEAD-BASED FADFT HAZARD REDUCTION IN 42 USC 4852.
TARGET HOUSING.

(a) GENERAL AUTHORITY.—^The Secretary is authorized to provide grants to eligible applicants to evaluate and reduce leadbased paint hazards in priority housing that is not federally assisted
housing, federally owned housing, or public housing, in accordance
with theprovisions of this section.
(b) ETLIGIBLE APPLICANTS.—^A State or unit of local government
that has an approved comprehensive housing affordability strategy
under section 105 of the Cranston-Cjonzalez National AfTordalMe
Housing Act (42 U.S.C. 12705) is eligible to apply for a grant
under this section.
(c) FORM OF APPLICATIONS.—^To receive a grant under this

section, a State or unit of local government shall submit an application in such form and in such manner as the Secretary shall
prescribe. An application shall contain—
(1) a copy of that portion of an applicant's comprehensive
housing affordability strategy required by section 105(bX16)
of the Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 12701 et seq.);

106 STAT. 3902

PUBLIC LAW 102-550—OCT. 28, 1992

(2) a description of the amount of assistance the applicant
seeks under this section;
(3) a description of the planned activities to be undertaken
with grants under this section, including an estimate of the
amount to be allocated to each activity;
(4) a description of the forms of financial assistance to
owners and occupants of priority housing tiiat will be provided
through grants under this section; and
(5) such assurances as the Secretary may require regarding
the applicant's capacity to carry out the activities.
(d) SELECTION CRITERIA.—The Secretary shall award grants
under this section on the basis of the merit of the activities proposed
to be carried out and on the basis of selection criteria, which
shall include—
(1) the extent to which the proposed activities will reduce
the risk of lead-based paint poisoning to children under the
age of 6 who reside in priority housing;
(2) the degree of severity and extent of lead-based paint
hazards in the jurisdiction to be served;
(3) the ability of the applicant to leverage State, local,
and private fimds to supplement the grant under this section;
(4) the ability of the applicant to carry out the proposed
activities; and
(5) such other factors as the Secretary determines appropriate to ensure that grants made available under this section
are used effectively and to promote the purposes of this Act.
(e) ELIGIBLE ACTIVITIES.—^A grant under this section may be
used to—
(1) perform risk assessments and inspections in priority
housing;
(2) provide for the interim control of lead-based paint hazards in priority housing;
(3) provide for the abatement of lead-based paint hazards
in priority housing;
(4) provide for the additional cost of reducing lead-based
paint hazards in units undergoing renovation funded by other
sources;
(5) ensure that risk assessments, inspections, and abatements are carried out by certified contractors in accordance
with section 402 of the Toxic Substances Control Act, as added
by section 1021 of this Act;
(6) monitor the blood-lead levels of workers involved in
lead hazard reduction activities fiinded imder this section;
(7) assist in the temporary relocation of families forced
to vacate priority housing while lead hazard reduction measures
are being conducted;
(8) educate the public on the nature and causes of lead
poisoning and measures to reduce exposure to lead, including
exposure due to residential lead-based paint hazards;
(9) test soil, interior surface dust, and the blood-lead levels
of children imder the age of 6 residing in priority housing
after lead-based paint hazard reduction activity has been conducted, to assure that such activity does not cause excessive
exposures to lead; and
(10) carry out such other activities that the Secretary determines appropriate to promote the purposes of this Act.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3903

(f) FORMS OF ASSISTANCE.—^The applicant may provide the services described in this section through a variety of programs, including grants, loans, equity investments, revolving loan funds, loan
funds, loan guarantees, interest write-downs, and other forms of
assistance approved by the Secretary.
(g) TECHNICAL ASSISTANCE AND CAPAcrry BUILDING.—
(1) IN GENERAL.—The Secretary shall develop the capacity
of eligible applicants to carry out the requirements of section
105(bX16) of the Cranston-Gonzalez National Affordable Housing Act and to carry out activities under this section. In fiscal
years 1993 and 1994, the Secretary may make grants of up
to $200,000 for the purpose of establishing State training, certification or accreditation programs that meet the requirements
of section 402 of the Toxic Substances Control Act, as added
by section 1021 of this Act.
(2) SET-ASIDE.—Of the total amount approved in appropriation Acts under subsection (o), there shall be set aside to
carry out Uiis subsection $3,000,000 for fiscal year 1993 and
$3,000,000 for fiscal year 1994.
(h) MATCHING REQUIREMENT.—^Each recipient of a grant under

this section shall make amtributions toward the cost of activities
that receive assistance wider this section in an amount not less
than 10 percent of the total grant amount under this section.
(i) PROHIBITION OF SUBSTITUTION OF FUNDS.—Grants under
this subtitle may not be used to replace other amounts made
available or designated by State or local governments for use for
the purposes under this subtitle.
(j) LIMITATION ON USE.—An applicant shall en8iu*e that not
more than 10 percent of the grant will be used for administrative
expenses associated with the activities funded.
(k) FINANCIAL RECORDS.—^An applicant shall maintain and
provide the Secretary with financial records sufficient, in the
determination of the Secretary, to ensure proper accounting and
disbursing of amoimts received firom a grant under this section.
(1) REPORT.—An appliccmt under this section shall submit to
the Secretary, for any fiscal year in which the applicant expends
grant funds under this section, a report that—
(1) describes the use of the amounts received;
(2) states the number of risk assessments and the number
of inspections conducted in residential dwellings;
(3) states the number of residential dwellings in which
lead-based psdnt hazards have been reduced through interim
controls;
(4) states the number of residential dwellings in which
lead-based paint hazards have been abated; and
(5) provides any other information that the Secretary determines to be appropriate.
(m) NOTICE OF FUNDING AVAILABILITY.—^The Secretary shall
publish a Notice of Funding Availability pursuant to this section
not later than 120 days after funds are appropriated for this section.
(n) RELATIONSHIP TO OTHER LAW.—Effective 2 years after the
date of promulgation of regulations under section 402 of the Toxic
Substances Control Act, no grants for lead-based paint hazard
evaluation or reduction may be awarded to a State under this
section unless such State has an authorized program under section
404 of the Toxic Substences Control Act.

106 STAT. 3904

PUBLIC LAW 102-550—OCT. 28, 1992

(o) AUTHORIZATION OF APPROPRIATIONS.—For the purposes of
carrying out this Act, there are authorized to be appropriated
$125,000,000 for fiscal year 1993 and $250,000,000 for fiscal year
1994.
SEC. 1012. EVALUATION AND REDUCTION OF LEAD-BASED PAINT HAZARDS IN FEDERALLY ASSISTED HOUSING.
(a) GENERAL REQUIREMENTS.—Section 302 of the Lead-Based

Paint Poisoning Prevention Act (42 U.S.C. 4822) is amended—
(1) by striking the title of the section and inserting:
"REQUIREMENTS FOR HOUSING RECEIVING FEDERAL ASSISTANCE";

(2) in the first sentence of subsection (a)—
(A) by striking "The Secretar}^** and inserting the following:
"(1) ELIMINATION OF HAZARDS.—The Secretary"; and

(B) by inserting before the period "or otherwise receives
more than $5,000 m project-based assistance under a Federal housing program ;
(3) by striking the second sentence of subsection (a) and
inserting: "Beginning on January 1, 1995, such procedures shall
apply to all such housing that constitutes target housing, as
denned in section 1004 of the Residential Lead-Based Paint
Hazard Reduction Act of 1992, and shall provide for appropriate
measures to conduct risk assessments, inspections, interim controls, and abatement of lead-based paint hazards. At a minimum, such procedures shall require—
"(A) the provision of lead hazard information pamhlets, developed pursuant to section 406 of the Toxic
ubstances Control Act, to purchasers and tenants;
"(B) periodic risk assessments and interim controls
in accordance with a schedule determined by the Secretary,
the initial risk assessment of each unit constructed prior
to 1960 to be conducted not later than January 1, 1996,
and, for units constructed between 1960 and 1978—
"(i) not less than 25 percent shall be performed
by January 1,1998;
"(ii) not less than 50 percent shall be performed
by January 1, 2000; and
"(iii) the remainder shall be performed by January
1, 2002;
"(C) inspection for the presence of lead-based paint
prior to federally-fimded renovation or rehabilitation that
is likely to disturb painted surfaces;
"(D) reduction of lead-based paint hazards in the course
of rehabilitation projects receiving less than $25,000 per
unit in Federal funds;
"(E) abatement of lead-based paint hazards in the
course of substantial rehabilitation projects receiving more
than $25,000 per unit in Federal fimds;
"(F) where risk assessment, inspection, or reduction
activities have been undertaken, the provision of notice
to occupants describing the nature and scope of such activities and the actual risk assessment or inspection reports
(including available information on the location of any
remaining lead-based paint on a surface-by-surface basis);
and

g

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3905

"(G) such other measures £is the Secretary deems
appropriate."; and
(4) in the third sentence, by striking T h e Secretary may"
and inserting the following:
"(2) ADDITIONAL iviEASURES.^The Secretary may".

(b) MEASUREMENT CRITERIA.—Section 302(b) of the Lead-Based
Paint Poisoning Prevention Act (42 U.S.C. 4822(b)) is amended
by striking "for the detection" and all that follows through the
end of paragraph (2) and inserting "for the risk assessment, interim
control, inspection, and abatement of lead-based paint hazards in
housing covered by this section shall be based upon guidelines
developed pursuant to section 1017 of the Residential Lead-Based
Paint Hazard Reduction Act of 1992.".
(c) INSPECTION.—Section 302(c) of the Lead-Based Paint Poisoning Prevention Act (42 U.S.C. 4822(c)) is amended—
(1) in the second sentence, by striking "qualified" and
inserting "certified"; and
(2) in the third and fourth sentences, by inserting "or
0.5 percent by weight" after "squared".
(d) PUBLIC HOUSING.—Section 302(dXl) of the Lead-Based
Paint Poisoning Prevention Act (42 U.S.C. 4822(dXl)) is amended—
(1) in the heading, by striking "CIAP" and inserting "MODERNIZATION"; and
(2) in the fourth sentence, by striking "to eliminate the
lead-based paint poisoning hazards" and inserting "of leadbased paint and lead-based paint hazards".
(e) HOME INVESTMENT PARTNERSHIPS.—Section 212(a) of the
Cranston-(jronzalez National Affordable Housing Act (42 U.S.C.
12742(a)) is amended by adding at the end the following new
paragraph:
"(5) LEAD-BASED PAINT HAZARDS.—^A participating jurisdic-

tion may use funds provided under this subtitle for the evaluation and reduction of lead-based paint hazards, as defined
in section 1004 of the Residential Lead-Based Paint Hazard
Reduction Act of 1992.".
(0 COMMUNITY DEVELOPMENT BLOCK GRANTS.—Section 105(a)
of the Housing and Community Development Act of 1974 (42 U.S.C.
5305(a)) is amended—
(1) in paragraph (19), by striking "and" at the end;
(2) in paragraph (20), by striking the period at the end
and inserting "; and"; and
(3) by adding at the end the following new paragraph:
"(21) lead-based paint hazard evaluation and reduction,
as defined in section 1004 of the Residential Lead-Based Paint
Hazard Reduction Act of 1992.".
(g) SECTION 8 RENTAL ASSISTANCE.—Section 8(cX2XB) of the

United States Housing Act of 1937 (42 U.S.C. 1437flcX2XB)) is
amended by adding at the end the following: "The Secretary may
(at the discretion of the Secretary and subject to the availability
of appropriations for contract amendments), on a project by project
basis for projects receiving project-based assistance, provide adjustments to the maximum monthly rents to cover the costs of evaluating and reducing lead-based paint hazards, as defined in section
1004 of the Residential Lead-Based Paint Hazard Reduction Act
of 1992.".

106 STAT. 3906

PUBLIC LAW 102-550—OCT. 28, 1992
(h) HOPE FOR PUBUC AND INDIAN HOUSING HOMEOWNER-

42 use
i437aaa-i.

42 use
I4d7aaa 2.

SHIP.—The United States Housing Act of 1937 (42 U.S.C. 1437
et seq.) is amended—
(1) in section 302(b)—
(^j Hy redesignating paragraphs (4) through (8) as
j
paragraphs (5) through (9), respectively; and
(B) by inserting after paragrai>h (3) the following:
"(4) inspection for lead-based paint hazards, as required
by section 302(a) of the Lead-Based Paint Poisoning Prevention
Act;"; and
(2) in section 303(b)—
(^j jjy redesignating paragraphs (4) through (13) as
paran'aphs (5) through (14), respectively; and
(B) by adding after paragraph (3) the following:
"(4) Abatement of lead-based paint hazards, as required
by section 302(a) of the Lead-Based Paint Poisoning Prevention
Act.".
(i) HOPE FOR HOMEOWNERSHIP OF MULTIFAMILY UNITS.—The

42 use 12872.

42 use 12873.

Cranston-Gronzalez National Affordable Housing Act (42 U.S.C.
12701 et seq.) is amended—
(1) In section 422(b)—
(A) by redesignating paragraphs (4) through (8) as
paragraphs (5) through (9), respectively; and
(B) by inserting aft«r paragraph (3) the following:
"(4) inspection for lead-based paint hazards, as required
by section 302(a) of the Lead-Based Paint Poisoning Prevention
Act;"; and
(2) in section 423(b)—
(A) by redesignating paragraphs (4) through (13) as
paragraphs (5) through (14), respectively; and
(B) by inserting aft«r paragraph (3) the foUovdng:
"(4) Abatement of lead-based paint hazards, as required
by section 302(a) of the Lead-Based Paint Poisoning Prevention
Act.".
(j) HOPE FOR HOMEOWNERSHIP OF SINGLE FAMILY HOMES.—

42 use 12892.

42 use 12893.

The Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
12701 et seq.) is amended—
(1) in section 442(b)—
(A) by redesignating paragraphs (4) through (8) as
paran'aphs (5) through (9), respectively; and
(B) by inserting after paragraph (3) the following:
"(4) inspection for lead-based paint hazards, as required
by section 302(a) of the Lead-Based Paint Poisoning Prevention
Act;"; and
(2) in section 443(b)—
(A) by redesignating paragraphs (4) through (10) as
paragraphs (5) through (11), respectively; and
(B) Dy inserting after paragraph (3) the following:
"(4) Abatement of lead-based paint hazards, as required
by section 302(a) of the Lead-Based Paint Poisoning Prevention
Act.",
(k) FHA INSURANCE FOR SINGLE FAMILY HOMES.—
(1) HOME IMPROVEMENT LOANS.—Section 2(a)

of

the

National Housing Act (12 U.S.C. 1703(a)) is amended in the
fifth paragraph—
(A) by inserting after the first sentence the following:
"Alterations, repairs, and improvements upon or in connec-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3907

tion with existing structures may also include the evaluation and reduction of lead-based paint hazards."; and
(B) by adding at the end the following:
"(4) the terms 'evaluation', 'reduction*, and lead-based paint
hazard' have the same meanings given those terms in section
1004 of the Residential Lead-Based Paint Hazard Reduction
Act of 1992.".
(2) REHABILITATION LOANS.—Section 203(kX2XB) of the
National Housing Act (12 U.S.C. 1709(kX2XB)) is amended
by adding at the end the following: 'The term 'rehabilitation'
may also include measures to evaluate and reduce lead-based
paint hazards, as such terms are defined in section 1004 of
the Residential Lead-Based Paint Hazard Reduction Act of
1992.".
(1) FHA

INSURANCE

FOR MULTIFAMILY

HOUSING.—Section

221(dX4Xiv) of the National Housing Act (12 U.S.C. 17151(dX4Xiv))
is amended by inserting after "rehabilitation" the first time it
appears the following: "(including the cost of evaluating and reducing lead-based paint hazards, as such terms are defined in section
1004 of the Residential Lead-Based Paint Hazard Reduction Act
of 1992)".
(m) RURAL HOUSING.—Section 501(a) of the Housing Act of

1949 (42 U.S.C. 1471) is amended by adding at the end the following:
"(5) DEFINITIONS.—For purposes of this title, the terms
'repair', 'repairs', 'rehabilitate', and 'rehabilitation' include
measures to evaluate and reduce lead-based paint hazards,
as such terms are defined in section 1004 of tne Residential
Lead-Based Paint Hazard Reduction Act of 1992.".
SEC. 1013. DISPOSITION OF FEDERALLY OWNED HOUSING.

Section 302(a) of the Lead-Based Paint Poisoning Prevention
Act (42 U.S.C. 4822(a)) (as amended by section 1012(a)) is amended
by striking the fourth sentence and adding at the end the following:
"(3) D I S P O S I T I O N OF FEDERALLY OWNED HOUSING.—
"(A) PRE-1960 TARGET HOUSING.—Beginning on January

1, 1995, procedures established under paragraphs (1) and
(2) shall reauire the inspection and abatement of leadbased paint hazards in all federally owned target housing
constructed prior to 1960.
"(B) TARGET HOUSING CONSTRUCTED BETWEEN i960 AND
1978.—Beginning on January 1, 1995, procedures established under paragraphs (1) and (2) shall require an inspection for lead-based paint and lead-based paint hazards
in all federally owned target housing constructed between
1960 and 1978. The results of such inspections shall be
made available to prospective purchasers, identifying the
presence of lead-based paint and lead-based paint hazards
on a surface-by-surface basis. The Secretary shall have
the discretion tt) waive the requirement of this subparagraph for housing in which a federally funded risk assessment, performed by a certified contractor, has determined
no lead-based paint hazards are present.
"(C) BUDGET AUTHORITY.—TO the extent that subparagraphs (A) and (B) increase the cost to the Cirovernment
of outstanding direct loan obligations or loan guarantee
commitments, such activities shall be treated as modifica-

106 STAT. 3908

PUBLIC LAW 102-550—OCT. 28, 1992
tions under section 504(e) of the Federal Credit Reform
Act of 1990 and shall be subject to the availability of
appropriations. To the extent that paragraphs (A) and (B)
impose additional costs to the Resolution Trust Corporation
and the Federal Deposit Insurance Corporation, its requirements shall be carried out only if appropriations are provided in advance in an appropriations Act. In the absence
of appropriations sufficient to cover the costs of subparagraphs (A) and (B), these requirements shall not apply
to the affected agency or agencies.
"(D) DEFINITIONS.—For the purposes of this subsection,
the terms 'inspection', 'abatement', lead-based paint hazard','federally owned housing*,'terget housing*,'nsk assessment', and 'certified contractor* have the same meaning
g'ven such terms in section 1004 of the Residential Leadased Paint Hazard Reduction Act of 1992.
"(4) DEFINITIONS.—For purposes of this subsection, the
terms 'risk assessment', 'inspection', 'interim control', 'abatement', 'reduction', and 'lead-based paint hazard' have the same
meaning given such terms in section 1004 of the Residential
Lead-Based Paint Hazard Reduction Act of 1992.

SEC. 1014. COMPREHENSIVE HOUSING AFFORDABILITY STRATEGY.

Section 105 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12705) is amended—
(1) in subsection (bX14), by striking "and" at the end;
(2) in subsection (bX15), by striking the period at the
end and inserting "; and";
(3) by inserting after paragraph (15) of subsection (b) the
following new paragraph:
"(16) estimate the number of housing unite within the
iurisdiction that are occupied by low-income families or very
low-income families and that contein lead-based paint hazards,
as defined in section 1004 of the Residential Lead-Based Paint
Hazard Reduction Act of 1992, outline the actions proposed
or being taken to evaluate and reduce lead-based paint nazards,
and describe how lead-based paint hazard reduction will be
integrated into housing policies and programs."; and
(4) in subsection (e>—
(A) by striking "When preparing" and inserting the
following:
"(1) IN GENERAL.—When preparing"; and
(B) by adding at the end the following new paragraph:
"(2) LEAD-BASED PAINT HAZARDS.—When preparing that
portion of a housing strategy required by subsection (DX16),
a jurisdiction shall consult with State or local health and child
welfare agencies and examine existing date related to leadbased paint hazards and poisonings, including health department date on the addresses of housing unite in which children
have been identified as lead poisoned.".
42 u s e 4852a.

SEC. 1015. TASK FORCE ON LEAD-BASED PAINT HAZARD REDUCTION
AND FINANCING.

(a) IN GENERAL.—^The Secretery, in consultetion with the
Administrator of the Environmentel Protection Agency, shall esteblish a tesk force to make recommendations on expanding resources
and efforte to evaluate and reduce lead-based paint nazards in
private housing.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3909

(b) MEMBERSHIP.—^The task force shall include individuals representing the Department of Housing and Urban Development,
the Farmers Home Administration, the Department of Veterans
Affairs, the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association, the Environmental Protection
Agency, employee organizations in the building and construction
trades industry, landlords, tenants, primary lending institutions,
private mortgage insurers, single-family and multifamil^ real estate
mterests, nonprofit housing developers, property liability insurers,
public housing agencies, low-income housing advocacy organizations, national. State and local lead-poisoning prevention advocates
and experts, and community-based organizations located in areas
with substantial rental housing.
(c) RESPONSIBILITIES.—^The task force shall make recommendations to the Secretary and the Administrator of the Environmental
Protection Agency concerning—
(1) incorporating the need to finance lead-based paint hazard reduction into underwriting standards;
(2) developing new loan products and procedures for financing lead-basea paint hazard evaluation and reduction activities;
(3) adjusting appraisal guidelines to address lead safety;
(4) incorporating risk assessments or inspections for leadbased paint as a routine procedure in the origination of new
residential mortgages;
(5) revising guidelines, regulations, and educational pamphlets issued by the Department of Housing and Urban Development and other Federal agencies relating to lead-based paint
poisoning prevention;
(6) reducing the current uncertainties of liability related
to lead-based paint in rental housing bv clarifying standards
of care for landlords and lenders, and by exploring the "s£ife
harbor" concept;
(7) increasing the availability of liability insurance for owners of rental housing and certified contractors and establishing
alternative systems to compensate victims of lead-based paint
poisoning; and
(8) evaluating the utility and appropriateness of requiring
risk assessments or inspections and notification to prospective
lessees of rental housing.
(d) COMPENSATION.—The members of the task force shall not
receive Federal compensation for their participation.
SEC. 1016. NATIONAL CONSULTATION ON LEAD-BASED PAINT HAZARD 42 USC 4852b.
REDUCTION.

In carrying out this Act, the Secretary shall consult on an
ongoing basis with the Administrator of the Environmental Protection Agency, the Director of the Centers for Disease Control, other
Federal agencies concerned with lead poisoning prevention, and
the task force established pursuant to section 1015.
SEC. 1017. GUIDELINES FOR LEAD-BASED PAINT HAZARD EVALUA- 42 USC 4852c.
TION AND REDUCTION ACTIYITIES.

Not later than 12 months after the date of enactment of this
Act, the Secretary, in consultation with the Administrator of the
Environmental Protection Agency, the Secretary of Labor, and the
Secretary of Health and Human Services (acting through the Director of the Centers for Disease Control), shall issue g^delines for
the conduct of federally supported work involving risk assessments.

106 STAT. 3910

PUBLIC LAW 102-550—OCT. 28, 1992

inspections, interim controls, and abatement of lead-based paint
hazards. Such guidelines shall be based upon criteria that measure
the condition of the housing (and the presence of children imder
age 6 for the purposes of risk assessments) and shall not be based
upon criteria that measure the health of the residents of the
housing.
42 u s e 4g52d.

Regulations.

SEC. 1018. DISCLOSURE OF INFORBfATION CONCERNING LEAD UPON
TRANSFER OF RESIDENTIAL PROPERTY.
(a) LEAD DISCLOSURE IN PURCHASE AND SALE OR LEASE OF
TARGET HOUSING.—
(1) LEAD-BASED PAINT HAZARDS.—Not later than 2 years

after the date of enactment of this Act, the Secretary and
the Administrator of the Environmental Protection Agency shall
promulgate regiilations imder this section for the disclosure
of lead-based paint hazards in target housing which is offered
for sale or lease. The r e l a t i o n s shall require that, before
the purchaser or lessee is obligated imder any contract to
purchase or lease the housing, the seller or lessor shall—
(A) provide the purchaser or lessee with a lead hazard
information pamphlet, as prescribed by the Administrator
of the Environmental Protection Agency under section 406
of the Toxic Substances Control Act;
(B) disclose to the purchaser or lessee the presence
of any known lead-based paint, or anjr known lead-based
paint hazards, in such housing and provide to the purchaser
or lessee any lead hazard evaluation report available to
the seller or lessor; and
(C) permit the purchaser a 10-day period (imless the
parties mutiially agree upon a different period of time)
to conduct a risk assessment or inspection for the presence
of lead-based paint hazards.
(2)

CONTRACT FOR PURCHASE AND SALE.—Regulations

promulgated under this section shall provide that every contract
for the purchase and sale of any interest in target housing
shall contain a Lead Warning Statement and a statement
signed by the purchaser that the purchaser has—
(A) read the Lead Warning Statement and understands
its contents;
(B) received a lead hazard information pamphlet; and
(C) had a 10-day opportunity (unless the parties mutually agreed upon a different period of time) before becoming
obligated under the contract to purchase the housing to
conduct a risk assessment or inspection for the presence
of lead-based paint hazcurds.
(3) CONTENTS OF LEAD WARNING STATEMENT.—The Lead
Warning Statement shall contain the following text printed
in large t}rpe on a separate sheet of paper attached to the
contract:
"Every purchaser of any interest in residential real property
on which a residential dwelling was built prior to 1978 is notified
that such property may present exposure to lead from lead-based
paint that may place young children at risk of developing lead
poisoning. Lead poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced
intelligence quotient, behavioral problems, and impaired memory.
Lead poisoning also poses a particular risk to pregnant women.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3911

The seller of any interest in residential real property is required
to provide the buyer with any information on lead-based paint
hazards from risk assessments or inspections in the seller's possession and notify the buyer of any known lead-based paint hazards.
A risk assessment or inspection for possible lead-based paint hazards is recommended prior to purchase.".
(4) COMPLIANCE ASSURANCE.—Whenever a seller or lessor
has entered into a contract with an agent for the piirpose
of selling or leeuiing a unit of target housing, the regulations
promulgated under this section shall require the agent, on
behalf of the seller or lessor, to ensure compliance with the
requirements of this section.
(5) PROMULGATION.—A suit may be brought against the
Secretary of Housing and Urbcui Development and the Administrator of the Environmental Protection Agency imder section
20 of the Toxic Substances Control Act to compel promulgation
of the regulations required under this section and the Federal
district court shall have jurisdiction to order such promulgation.
(b) PENALTIES FOR VIOLATIONS.—
(1) MONETARY PENALTY.—^Any person who knowingly vio-

lates any provision of this section shall be subject to civil
money penalties in accordance with the provisions of section
102 of the Department of Housing and Urban Development
Reform Act of 1989 (42 U.S.C. 3545).
(2) ACTION BY SECRETARY.—The Secretary is authorized
to take such lawful action as may be necessary to ei\join any
violation of this section.
(3) CIVIL LIABILITY.—^Any person who knovdngly violates
the provisions of this section shall be jointly and severally
liable to the purchaser or lessee in an amount equal to 3
times the amount of damages incurred by such individual.
(4) COSTS.—In any civil action brought tor damages pursuant to paragraph (3), the appropriate court may award court
costs to the party commencing such action, together with
reasonable attorney fees and any expert witness fees, if that
party prevails.
(5) PROHIBITED ACT.—^It shall be a prohibited act under
section 409 of the Toxic Substances Control Act for any person
to fail or refuse to comply with a provision of this section
or with any rule or order issued under this section. For purposes
of enforcing this section under the Toxic Substances Control
Act, the penalty for each violation applicable under section
16 of that Act shall not be more than $10,000.
(c) VALIDITY OF CONTRACTS AND LIENS.—Nothing in this section
shall affect the validity or enforceability of any sale or contract
for the purchase and sale or lease of any interest in residential
real property or any loan, loan agreement, mortgage, or lien made
or arising in connection with a mortgage loan, nor shall anything
in this section create a defect in title.
(d) EFFECTIVE DATE.—^The regulations under this section shall
take effect 3 years after the date of the enactment of this title.

106 STAT. 3912
Lead-B£ised
Paint Exposure
Reduction Act.

PUBLIC LAW 102-550—OCT. 28, 1992

Subtitle B—^Lead Exposure Reduction
SEC. 1021. CONTRACTOR TRAINING AND CERTIFICATION.
(a) AMENDMENT TO THE TOXIC SUBSTANCES CONTROL ACT.—

The Toxic Substances Control Act (15 U.S.C. 2601 et seq.) is
amended by adding after title III the following new title:

m X L E IV—LEAD EXPOSURE
REDUCTION
15 u s e 2681.

"SEC. 401. DEFINITIONS.

*Tor the purposes of this title:
"(1) ABATEMENT.—^The term 'abatement' means any set of
measures designed to permanently eliminate lead-based paint
h£izards in accordsince with standards established by the
Administrator under this title. Such term includes—
"(A) the removal of lead-based paint and lead-contaminated dust, the permanent containment or encapsulation
of lead-based paint, the replacement of lead-painted surfaces or fixtures, and the removal or covering of leadcontaminated soil; and
"(B) all preparation, cleanup, disposal, and
postabatement clearance testing activities associated with
such measures.
"(2) ACCESSIBLE SURFACE.—The term 'accessible surface'
means an interior or exterior surface painted with lead-based
paint that is accessible for a young child to mouth or chew.
"(3) DETERIORATED PAINT.—The term 'deteriorated paint'
means any interior or exterior paint that is peeling, chipping,
chalking or cracking or any paint located on an interior or
exterior surface or fixture that is damaged or deteriorated.
"(4) EVALUATION.—^The term 'evaluation' means risk assessment, inspection, or risk assessment and inspection.
"(5) FRICTION SURFACE.—^The term 'friction surface' means
an interior or exterior surface that is subject to abrasion or
friction, including certain window, floor, and stair surfaces.
"(6) IMPACT SURFACE.—^The term 'impact surface' means
an interior or exterior surface that is subject to damage by
repeated impacts, for example, certain parts of door frames.
"(7) INSPECTION.—^The term 'inspection' means (A) a surface-by-surface investigation to determine the presence of leadbased paint, as provided in section 302(c) of the Lead-Based
Paint Poisoning Prevention Act, and (B) the provision of a
report explaining the results of the investigation.
"(8) INTERIM CONTROLS.—^The term Interim controls' means
a set of measures designed to reduce temporarily human exposure or likelv exposure to lead-based paint hazards, including
specialized cleamng, repairs, maintenance, painting, temporary
conteinment, ongoing monitoring of lead-based paint hazards
or potential hazards, and the esteblishment and operation of
management and resident education programs.
"(9) LEAD-BASED PAINT.—^The term lead-based paint' means
paint or other surface coatings that contain lead in excess
of 1.0 milligrams per centimeter squared or 0.5 percent by
weight or (A) in the case of paint or other surface coatings

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3913

on target housing, such lower level as may be established
by the Secretary of Housing and Urban Development, as defined
in section 302(c) of the Lead-Based Paint Poisoning Prevention
Act, or (B) in the case of any other paint or surface coatings,
such other level as may be established bv the Administrator.
**(10) LEAD-BASED PAINT HAZARD.—The term lead-based
>aint hazard' means any condition that causes exposure to
eadfromlead-contaminated dust, lead-cont£uninated soil, leadcontaminated paint that is deteriorated or present in accessible
surfaces, friction surfaces, or impact surfaces that would result
in adverse human health effects as established by the Administrator imder this title.
"(11) LEAD-CONTAMINATED DUST.—^The term lead-contaminated dust' means surface dust in residential dwellings that
contains an area or mass concentration of lead in excess of
levels determined by the Administrator imder this title to pose
a threat of adverse health effects in pregnant women or young
children.
"(12) LEAD-CONTAMINATED SOIL.—The term lead-contaminated soil' means bare soil on residential real property that
contains lead at or in excess of the levels determined to be
hazeurdous to human health by the Administrator under this
title.
"(13) REDUCTION.—^The term 'reduction' means measures
designed to reduce or eliminate human exposure to lead-based
paint hazards through methods including mterim controls and
abatement.
"(14) RESIDENTIAL DWELLING.—The term 'residential dwelling* means—
"(A) a single-family dwelling, including attached structures such as porches and stoops; or
"(B) a single-family dwelling unit in a structure that
contains more than 1 separate residential dwelling imit,
and in which each such unit is used or occupied, or intended
to be used or occupied, in whole or in part, as the home
or residence of 1 or more persons.
"(15) RESIDENTIAL REAL PROPERTY.—The term 'residential
real property* means real property on which there is situated
1 or more residential dwellings used or occupied, or intended
to be used or occupied, in whole or in part, as the home
or residence of 1 or more persons.
"(16) RISK ASSESSMENT.—^The term 'risk assessment' means
an on-site investigation to determine and report the existence,
nature, severitv and location of lead-based paint hazards in
residential dwellings, including—
"(A) information gathering regarding the age and history of the housing and occupancy by children under age
6;
"(B) visual inspection;
"(C) Umited wipe sampling or other environmental
sampling techniques;
"(D) other activity as may be appropriate; and
"(E) provision of a report explaining the results of
the investigation.
"(17) TARGET HOUSING.—The term 'target housing* means
any housing constructed prior to 1978, except housing for the
elderly or persons with olisabilities (unless any child who is

1

i

106 STAT. 3914

PUBLIC LAW 102-550—OCT. 28, 1992
less than 6 years of age resides or is expected to reside in
such housing for the elderly or persons with disabilities) or
any 0-bedroom dwelling. In the case of jurisdictions which
banned the sale or use of lead-based paint prior to 1978, the
Secretary of Housing and Urban Development, at the Secretary's discretion, may designate an earlier date.

15 u s e 2682.

«<SEC. 402. LEAD-BASED PAINT ACTIVITIES TRAINING AND CERTIFI.
CATION.
"(a) REGULATIONS.—

"(1) IN GENERAL.—Not later than 18 months after the date
of the enactment of this section, the Administrator shall, in
consultation with the Secretary of Labor, the Secretary of Housing and Urban Development, and the Secretary of Health and
Human Services (acting through the Director of the National
Institute for Occupational Safety and Health), promulgate final
regulations governing lead-based paint activities to ensure that
individuals engaged in such activities are properly trained;
that training programs are accredited; and that contractors
engaged in such activities are certified. Such regulations shall
contain standards for performing lead-based paint activities,
taking into account reliability, effectiveness, and safety. Such
regulations shall require that all risk assessment, inspection,
and abatement activities performed in target housing shall
be performed by certified contractors, as such term is defined
in section 1004 of the Residential Lead-Based Paint Hazard
Reduction Act of 1992. The provisions of this section shall
supersede the provisions set forth under the heading 'Lead
Abatement Training and Certification' and under the heading
Training Grants' in title III of the Act entitled 'An Act making
appropriations for the Departments of Veterans Affairs and
Housing and Urban Development, and for sundry independent
agencies, commissions, corporations, and offices for the fiscal
year ending September 30, 1992, and for other piirposes'. Public
Law 102-139, and upon the enactment of this section the
provisions set forth in such public law under such headings
shall cease to have any force and effect.
"(2) ACCREDITATION OF TRAINING PROGRAMS.—Final regulations promulgated under paragraph (1) shall contain specific
requirements for the accreditation of lead-based paint activities
training programs for workers, supervisors, inspectors and planners, and other individuals involved in lead-based paint activities, including, but not limited to, each of the following:
"(A) Minimum requirements for the accreditation of
training providers.
"(B) Minimum training curriculum requirements.
"(C) Minimum training hour requirements.
"(D) Minimum hands-on training requirements.
"(E) Minimum trainee competency and proficiency
requirements.
"(F) Minimum requirements for training program quality control.
"(3)

ACCREDITATION

AND

CERTIFICATION

FEES.—The

Administrator (or the State in the case of an authorized State
program) shall impose a fee on—
"(A) persons operating training programs accredited
under this title; and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3915

"(B) lead-based paint activities contractors certified in
accordance with paragraph (1).
The fees shall be established at such level as is necessary
to cover the costs of administering and enforcing the standards
and regulations under this section which are applicable to
such programs and contractors. The fee shall not be imposed
on any State, local government, or nonprofit training program.
The Administrator (or the State in the case of an authorized
State program) may waive the fee for lead-based paint activities
contractors imder subparagraph (A) for the purpose of training
their own employees.
"(b) LEAD-BASED PAINT AcnvmES.—For purposes of this title,
the term lead-based paint activities' means—
"(1) in the case of target housing, risk assessment, inspection, and abatement; and
"(2) in the case of any public building constructed before
1978, commercial building, bridge, or other structure or superstructure, identification of lead-based paint and materials
containing lead-based paint, deleading, removal of lead firom
bridges, and demolition.
For purposes of paragraph (2), the term 'deleading* means activities
conducted bv a person who offers to eliminate lead-based paint
or lead-based paint hazards or to plan such activities,
"(c) RENOVATION AND REMODEUNG.—

"(1) GUIDELINES.—^In order to reduce the risk of exposure
to lead in connection with renovation and remodeling of target
housing, public buildings constructed before 1978, and commercial bmldings, the Administrator shall, within 18 months afi;er
the enactment of this section, promidgate guidelines for the
conduct of such renovation and remodeling activities which
may create a risk of exposure to dangerous levels of lead.
The Administrator shall disseminate such guidelines to persons
engaged in such renovation and remodeling through hardware
and paint stores, employee organizations, trade groups. State
and local agencies, and through other appropriate means.
"(2) STUDY OF CERTIFICATION.—The Administrator shall
conduct a study of the extent to which persons engaged in
various types of renovation and remodeling activities in target
housing, public buildings constructed before 1978, and commercial buildings are exposed to lead in the conduct of such activities or disturb lead and create a lead-based paint hazard on
a regular or occasional basis. The Administrator shall complete
such study and publish the results thereof vdthin 30 months
after the enactment of this section.
"(3) CERTIFICATION DETERMINATION.—Within 4 years after Regulations.
the enactment of this section, the Administrator snail revise
the regulations under subsection (a) to apply the regulations
to renovation or remodeling activities in target housing, public
buildings constructed before 1978, and commercial buildings
that create lead-based paint hazards. In determining which
contractors are engaged in such activities, the Administrator
shall utilize the results of the study under paragraph (2) and
consult with the representatives of labor organizations, leadbased paint activities contraciors, persons engaged in remodeling and renovation, experts in lead health eitects, and others.
If the Administrator determines that any category of contractors
engaged in renovation or remodeling does not require certifi-

106 STAT. 3916

PUBLIC LAW 102-550—OCT. 28, 1992
cation, the Administrator shall publish an explanation of the
basis for that determination.

15 u s e 2683.
Regulations.

15 u s e 2684.

'^EC. 403. IDENTIFICATION OF DANGEROUS LEVELS OF LEAD.

"Within 18 months after the enactment of this title, the
Administrator shall promulgate regulations which shall identify,
for purposes of this title and the Residential Lead-Based Paint
Hazard Reduction Act of 1992, lead-based paint hazards, leadcontaminated dust, and lead-contiaminated soil.
<«£€. 404. AUTHORIZED STATE PROGRAMS.

"(a) APPROVAL.—^Any State which seeks to administer and
enforce the standards, regulations, or other requirements established under section 402 or 406, or both, may, £ifter notice and
opportunity for public hearing, develop and submit to the Administrator an application, in such form as the Administrator shall
require, for authorization of such a State program. Any such State
may also certify to the Administrator at the time of submitting
sucn program that the State program meets the requirements of
paragrapns (1) and (2) of subsection (b). Upon submission of such
certification, the State program shall be deemed to be authorized
iinder this section, and shall apply in such State in lieu of the
corresponding Federal program imder section 402 or 406, or both,
as the case may be, until such time as the Administrator disapproves the program or withdraws the authorization.
"(b) APPROVAL OR DISAPPROVAL.—Within 180 days following
submission of an application under subsection (a), the Administrator
shall approve or disapprove the application. The Administrator
may approve the application only if, after notice and after opportunity for public hearing, the Administrator finds that—
"(1) the State program is at least as protective of human
health and the environment as the Federal program under
section 402 or 406, or both, as the case may be, and
"(2) such State program provides adequate enforcement.
Upon authorization of a State program under this section, it shall
be unlawful for any person to violate or fail or refuse to comply
with any requirement of such program.
"(c) WITHDRAWAL OF AUTHORIZATION.—If a State is not admin-

istering and enforcing a program authorized imder this section
in compliance with standards, regulations, and other requirements
of this title, the Administrator shall so notify the State and, if
corrective action is not completed within a reasonable time, not
to exceed 180 days, the Administrator shall withdraw authorization
of such program and establish a Federal program pursuant to
this title.
"(d) MODEL STATE PROGRAM.—Within 18 months after the

enactment of this title, the Administrator shall promulgate a model
State program which may be adopted by any State which seeks
to administer and enforce a State program under this title. Such
model program shall, to the extent practicable, encourage States
to utilize existing State and local certification and accreditation
programs and procedures. Such program shall encourage reciprocity
among the States vnth respect to the certification under section
402.
"(e) OTHER STATE REQUIREMENTS.—^Nothing in this title shall
be construed to prohibit any State or political subdivision thereof
from imposing any requirements which are more stringent theui
those imposed by tnis title.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3917

"(f) STATE AND LOCAL CERTIFICATION.—The regulations under
this title shall, to the extent appropriate, encourage States to seek
program authorization and to use existing State and local certification and accreditation procedures, except that a State or local
government shall not require more than 1 certification under this
section for any lead-based paint activities contractor to carry out
lead-based paint activities in the State or political subdivision
thereof.
"(g) GRANTS TO STATES.—^The Administrator is authorized to
make grants to States to develop and carry out authorized State
programs under this section. The grants shall be subject to such
terms and conditions as the Administrator may establish to further
the purposes of this title.
"(h) ENFORCEMENT BY ADMINISTRATOR.—If a State does not
have a State program authorized under this section and in efiTect
by the date which is 2 years after promulgation of the regulations
under section 402 or 406, the Administrator shall, by such date,
establish a Federal program for section 402 or 406 (as the case
may be) for such State and administer and enforce such program
in such State.
'^EC. 406. LEAD ABATEMENT AND MEASUREMENT.
15 USC 2685.
"(a) PROGRAM To PROMOTE LEAD EXPOSURE ABATEMENT.—The

Administrator, in cooperation with other appropriate Federal
departments and agencies, shall conduct a comprehensive program
to promote safe, effective, and affordable monitoring, detection,
and abatement of lead-based paint and other lead exposure hazards.
"(b)

STANDARDS FOR ENVIRONMENTAL SAMPUNG LABORA-

TORIES.—(1) The Administrator shall establish protocols, criteria,
and minimum performance standards for laboratory analysis of
lead in paint films, soil, and dust. Within 2 years after the enactment of this title, the Administrator, in consultation with the Secretary of Health and Human Services, shall establish a program
to certify laboratories as qualified to test substances for lead content
imless the Administrator determines, by the date specified in this
paragraph, that effective voluntary accreditation programs are in
place and operating on a nationwide basis at the time of such
determination. To be certified under such program, a laboratory
shall, at a minimum, demonstrate an ability to test substances
accurately for lead content.
"(2) Not later than 24 months after the date of the enactment Public
of this section, and annually thereafter, the Administrator shall ^formation
publish and make available to the public a list of certified or
accredited environmental sampling laboratories.
"(3) If the Administrator determines under paragraph (1) that
effective voluntary accreditation programs are in place for environmental sampling laboratories, the Administrator shall review the
performance and effectiveness of such programs within 3 years
after such determination. If, upon such review, the Administrator
determines that the voluntary accreditation programs are not effective in assuring the quality and consistency of laboratory analyses,
the Administrator shall, not more than 12 months thereafter, establish a certification program that meets the requirements of paragraph (1).
"(c) EXPOSURE STUDIES.—(1) The Secretary of Health and
Human Services (hereafter in this subsection referred to as the
'Secretary*), acting through the Director of the Centers for Disease

106 STAT. 3918

"Reports.

PUBLIC LAW 102-550—OCT. 28, 1992

Control, (CDC), and the Director of the National Institute of
Environmental Health Sciences, shall jointly conduct a study of
the soiu'ces of lead exposure in children who have elevated blood
lead levels (or other indicators of elevated lead body burden), as
defined by the Director of the Centers for Disease Control.
"(2) The Secretaiy, in consultation with the Director of the
National Institute for Occupational Safety and Health, shall conduct
a comprehensive study of means to reduce hazardous occupational
lead abatement exposures. This study shall include, at a minimum,
each of the following—
"(A) Surveillance and intervention capability in the States
to identify and prevent hazardous exposures to lead abatement
workers.
"(B) Demonstration of lead abatement control methods and
devices and work practices to identify and prevent hazardous
lead exposures in the workplace.
"(C) Evaluation, in consultation with the National Institute
of Environmental Health Sciences, of health effects of low and
high levels of occupational lead exposures on reproductive,
neurological, renal, and cardiovascular health.
"(D) Identification of high risk occupational settings to
which prevention activities and resources should be targeted.
"(E) A study assessing the potential exposures and risks
from lead to janitorial and custodial workers.
"(3) The studies described in paragraphs (1) and (2) shall,
as appropriate, examine the relative contributions to elevated lead
body burden from each of the following:
"(A) Drinking water.
''(B)Food.
"(C) Lead-based paint and dust from lead-based paint.
"(D) Exterior sources such as ambient air and lead in
soil.
"(E) Occupational exposures, and other exposures that the
Secretary determines to be appropriate.
"(4) ifoi later than 30 months after the date of the enactment
of this section, the Secretary shall submit a report to the Congress
concerning the studies described in paragraphs (1) and (2).
"(d) PUBLIC EDUCATION.—<1) The Administrator, in com'unction
with the Secretary of Health and Human Services, acting through
the Director of the Agency for Toxic Substances and Disease Registry, and in conjunction with the Secretary of Housing and Urban
Development, shall sponsor public education and outreach activities
to increase public awareness of—
"(A) the scope and severity of lead poisoning from household
sources;
"(B) potential exposure to sources of lead in schools and
childhood day care centers;
"(C) the implications of exposures for men and women,
particularly those of childbearing age;
"(D) the need for careful, quality, abatement and management actions;
"(E) the need for universal screening of children;
"(F) other components of a lead poisoning prevention program;
"(G) the health consequences of lead exposure resulting
from lead-based paint hazards;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3919

"(H) risk assessment and inspection methods for lead-based
p£dnt hazards; and
**(I) measures to reduce the risk of lead exposure from
lead-based paint.
"(2) The activities described in paragraph (1) shall be designed
to provide educational services and information to—
"(A) health professionals;
"(B) the general public, with emphasis on parents of young
children;
"(C) homeowners, landlords, and tenants;
"(D) consumers of home improvement products;
"(E) the residential real estate industry; and
"(F) the home renovation industry.
"(3) In implementing the activities described in paragraph (1),
the Administrator shall assure coordination with the President's
Commission on Environmental Quality's education and awareness
campaign on lead poisoning.
"(4) The Administrator, in consultation with the Chairman
of the Consumer Product Safety Commission, shall develop information to be distributed by retailers of home improvement products
to provide consumers with practical information related to the hazaros of renovation and remodeling where lead-based paint may
be present.
"(e) TECHNICAL ASSISTANCE.—

"(1) CLEAMNGHOUSE.—Not later than 6 months after the Establishment.
enactment of this subsection, the Administrator shall establish,
in consultation with the Secretary of Housing and Urban Development and the Director of the Centers for Disease Control,
a National Clearinghouse on Childhood Lead Poisoning (hereinafter in this section referred to as 'Clearinghouse'). The
Clearinghouse shall—
"(A) collect, evaluate, and disseminate current information on the assessment and reduction of lead-based paint
hazards, adverse health effects, sources of exposure, detection and risk assessment methods, environmental hazards
abatement, and clean-up standards;
"(B) maintain a rapid-alert system to inform certified
lead-based paint activities contractors of significant developments in research related to lead-based psdnt hazards;
and
"(C) perform any other duty that the Administrator
determines necessary to achieve the purposes of this Act.
"(2) HOTLINE.—Not later than 6 months after the enactment of this subsection, the Administrator, in cooperation with
other Federal agencies and with State and local governments,
shall establish a single lead-based paint hazard hotline to provide the public with answers to questions about lead poisoning
prevention and referrals to the Clearinghouse for technical
information.

"(D PRODUCTS

FOR LEAD-BASED PAINT ACTIVITIES.—Not

later President.

than 30 months after the date of enactment of this section, the Regulations.
President shall, after notice and opportunity for comment, establish
by rule appropriate criteria, testing protocols, and performance
characteristics as are necessary to ensure, to the greatest extent
possible and consistent with the purposes and policy of this title,
that lead-based paint hazard evaluation and reduction products
introduced into commerce after a period specified in the rule are

106 STAT. 3920

PUBLIC LAW 102-550—OCT. 28, 1992

effective for the intended use described by the manufacturer. The
rule shall identify the types or classes of products that are subject
to such rule. The President, in implementation of the rule, shall,
to the maximum extent possible, utilize independent testing labinratories, as appropriate, and consult with such entities and others
in developing the rules. The President may delegate the authorities
under this subsection to the Environmental Protection Agency or
the Secretary of Commerce or such other appropriate agency.
15 use 2686.

Regulations.

«SEC. 406. LEAD HAZARD INFORMATION PAMPHLET.
"(a) LEAD HAZARD INFORMATION PAMPHLET.—Not later than
2 years after the enactment of this section, after notice and opportunity for comment, the Administrator of the Environmental Protection Agenpy, in consultation with the Secretary of Housing and
Urban Development and with the Secretary of Health and Human
Services, shall publish, andfiromtime to time revise, a lead hazard
information pamphlet to be used in connection with this title and
section 1018 of the Residential Lead-Based Paint Hazard Reduction
Act of 1992. The pamphlet shall—
"(1) contain information regarding the health risks associated with exposure to lead;
"(2) provide information on the presence of lead-based paint
hazards in federally assisted, federally owned, and target housing;
"(3) describe the risks of lead exposure for children under
6 years of age, pregnant women, women of childbearing age,
persons involved in home renovation, and others residing in
a dwelling with lead-based paint hazards;
"(4) describe Uie risks of renovation in a dwelling with
lead-based paint hazards;
"(5) provide information on approved methods for evaluating and reducing lead-based pamt hazards and their,effectiveness in identifying, reducing, eliminating, or preventing
exposure to lead-based paint hazards;
"(6) advise persons how to obtain a list of contractors
certified pursuant to this title in lead-based paint hazard
evaluation and reduction in the area in which the pamphlet
is to be used;
"(7) state that a risk assessment or inspection for leadbased paint is recommended prior to the purchase, lease, or
renovation of target housing;
"(8) state that certain State and local laws impose additional requirements related to lead-based paint in housing and
grovide a listing of Federal, State, and local agencies in each
tate, including address and telephone number, that can provide information about applicable laws and available governmental and private assistance and financing; and
"(9) provide such other information about environmental
hazards associated with residential real property as the
Administrator deems appropriate.
«(b) RENOVATION OF TARGET HOUSING.—Within 2 years a&et
the enactment of this section, the Administrator shall promulgate
regulations under this subsection to require each person who performs for compensation a renovation of target housing to provide
a lead hazard information pamphlet to the owner and occupant
of such housing prior to commencing the renovation.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3921

*8EC. 407. BEGUIATIONS.

15 USC 2687.

T h e regulations of the Administrator under this title shall
include such recordkeeping and reporting requirements as may
be necessary to insure the effective implementation of this title.
The regulations may be amended from time to time as necessary.
•nSEC. 408. CONTROL OF LEAD-BASED PAINT HAZABD8 AT FEDERAL 15 USC 2688.
FACnJTIES.

"Each department, agency, and instrumentality of executive,
legislative, and judicial branches of the Federal Government (1)
having jurisdiction over any property or facility, or (2) engaged
in any activity resulting, or which may result, in a lead-based
paint hazard, and each officer, agent, or employee thereof, shall
be subject to, and comply with, all Federal, State, interstate, and
local requirements, both substantive and procedural (including any
requirement for certification, licensing, recordkeeping, or reporting
or any provisions for injunctive relief and such sanctions as may
be imposed by a court to enforce such relief) respecting lead-based
paint, lead-based paint activities, and lead-based paint hazards
in the same manner, and to the same extent as any nongovernmental entity is subject to such requirements, including the payment of reasonable service charges. The Federal, State, interstate,
and local substantive and procedural requirements referred to in
this subsection include, but are not limited to, all administrative
orders and all civil and administrative penalties and fines regardless of whether such penalties or fines are punitive or coercive
in nature, or whether imposed for isolated, intermittent or continuing violations. The United States hereby expressly waives any
immunity otherwise applicable to the United States with respect
to any such substantive or procedural requirement (including, but
not limited to, any ii\junctive relief, administrative order, or civil
or administrative penalty or fine referred to in the preceding sentence, or reasonable service charge). The reasonable service charges
referred to in this section include, but are not limited to, fees
or charges assessed for certification and licensing, as well as any
other nondiscriminatory charges that are assessed in connection
with a Federal, State, interstate, or local lead-based paint, leadbased paint activities, or lead-based paint hazard activities program.
No agent, employee, or officer of the United States shall be personally liable for any civil penalty under any Federal, State, interstate,
or local law relating to lead-based paint, lead-based paint activities,
or lead-based paint hazards with respect to any act or omission
within the scope of his official duties.
<^EC. 409. PROHIBITED ACTS.

15 USC 2689.

"It shall be imlawful for any person to fail or refuse to comply
with a provision of this title or with any rule or order issued
under this title.
'^EC. 410. RELATIONSHIP TO OTHER FEDERAL LAW.

"Nothing in this title shall affect the authority of other appropriate Federal agencies to establish or enforce any requirements
which are at least as stringent as those established pursuant to
this title.

15 USC 2690.

106 STAT. 3922
15 use 2691.

PUBLIC LAW 102-550—OCT. 28, 1992

<«EC. 411. GENERAL PROVISIONS RELATING TO ADMINISTRATIVE
PROCEEDINGS.
"(a) ApPLlCABiLiTy.—^This section applies to the promulgation
or revision of any regulation issued under this title.
"(b) RULEMAKING DOCKET.—Not later than the date of proposal
of any action to which this section applies, the Administrator shall
establish a rulemaking docket for such action (hereinafter in this
subsection referred to as a 'rule'). Whenever a rule applies only
within a particular State, a second (identical) docket shall be established in the appropriate regional office of the Environmental
Protection Agency.
"(c) INSPECTION AND COPYING.—(1)

The rulemaking docket

required under subsection (b) shall be open for inspection by the
public at reasonable times specified in the notice of proposed rulemaking. An^ person mav copy documents contained in the docket.
The Administrator shall provide copying facilities which may be
used at the expense of the person seeking copies, but the Administrator may waive or reduce such expenses in such instances as
the public interest requires. Any person may request copies by
mail if the person pays the expenses, including personnel costs
to do the copying.
"(2XA) Promptly upon receipt by the agency, all written comments and documentary information on the proposed rule received
from any person for inclusion in the docket during the comment
period shall be placed in the docket. The transcript of public hearuigs, if any, on the proposed rule shall also be included in the
docket promptly upon receipt from the person who transcribed
such hearings. All documents which become available after the
proposed hue has been published and which the Administrator
aetermines are of central relevance to the rulemaking shall be
placed in the docket as soon as possible after their availability.
"(B) The drafts of proposed rules submitted by the Administrator to the Office of Management and Budget for any interagency
review process prior to proposal of any such rule, all docimients
accompanying such drafts, and all written comments thereon by
other agencies and all written responses to such written comments
by the Administrator shall be placed in the docket no later than
the date of proposal of the rule. The drafts of the final rule submitted for such review process prior to promulgation and all such
written comments thereon, all documents accompanjdng such drafts,
and written responses thereto shall be placed in the docket no
later than the date of promulgation.
"(d) EXPLANATION.—(1) The promulgated rule shall be accompanied by an explanation of the reasons for any major changes
in the promulgated rule from the proposed rule.
"(2) The promulgated rule shall also be accompanied by a
response to each of the significant comments, criticisms, and new
data submitted in written or oral presentations during the comment
period.
"(3) The promulgated rule may not be based (in part or whole)
on any information or data which has not been placed in the
docket as of the date of such promulgation.
"(e) JUDICIAL REVIEW.—The material referred to in subsection
(cX2XB) shall not be included in the record for judicial review.
"(f) EFFECTIVE DATE.—^The requirements of this section shall
take effect with respect to any rule the proposal of which occurs
after 90 days after the date of the enactment of this section.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3923

«SEC. 4 U . AUTHOBIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to carry out the
purposes of this title such sums as may be necessary.".
(b) TECHNICAL AND CONFORMING AMENDMENTS.—The Toxic
Substances Control Act (16 U.S.C. 2610) is amended as follows:
(1) In paragraph (1) of section 7(a), strike "or 6" and insert
«6, or title l \ r and after -5" insert "or title IV".
(2) In the first sentence of subsection (a) of section 11:
(A) Strike "or mixtures" before "are manufactured" and
insert", nuxtures, or products subject to title IV".
(B) Insert "such products," before "or such articles".
(3) In paragraph (1) of subsection (b) of section 11, strike
"or mixtures" and insert ", mixtures, or products subject to
title IV".
(4) in paragraph (1) of section 13(a), strike "or 6" in each
place it appears and insert ", 6, or title IV" and strike "or
7" and insert", 7 or title IV".
(5) In section 16, insert "or 409" after "section 15" each
place it appears.
(6) In section 17, amend subsection (a) to read as follows:
"(a) SPECIFIC ENFORCEMENT.—(1) The district courts of the
United States shall have jurisdiction over civil actions to—
"(A) restrain any violation of section 15 or 409,
"(B) restrain any personfiromtaking any action prohibited
by section 5, 6, or title IV, or by a rule or order under section
5,6, or title IV,
"(C) compel the taking of any action required by or under
this Act, or
"(D) direct any manufacturer or processor of a chemical
substance, mixture, or product subject to title IV manufactured
or processed in violation of section 5, 6, or title IV, or a rule
or order under section 5, 6, or title TV, and distributed in
commerce, (i) to give notice of such fact to distributors in
commerce of such substance, mixture, or product and, to the
extent reasonably ascertainable, to other persons in possession
of such substance, mixture, or product or exposed to such
substance, mixture, or product, (ii) to give public notice of
such risk of iiyury, and (iii) to either replace or repurchase
such substance, nuxture, or product, whicnever the person to
which the requirement is directed elects.".
(7) In the first sentence of subsection (b) of section 17—
(A) strike "or mixture" afl»r "Any chemical substance"
and inserting ", mixture, or product subject to title IV";
and
(B) insert "product," before "or article" in each place
that it appears.
(8) In section 19—
(A) In the first sentence of subsection (a), after "title
i r insert "or IV".
(B) Before the semicolon at the end of subsection
(aX3XB) insert "and in the case of a rule under title IV,
thefindingrequired for the issuance of such a rule".
(9) In section 20(aXl) after "title II" msert "or IV" in
each place it appears.
(10) Add at the end of the table of contents in section
1 the following:

15 USC 2692.

15 use 2606.
is use 26io.

15 use 2612.
15 use 2615.
15 use 2616.

fu^iic
"^"nation-

15 use 2618.

15 USC 2619.

106 STAT. 3924
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
"Sec.
15 u s e 2601
note.

PUBLIC LAW 102-550—OCT. 28, 1992
401.
402.
403.
404.
405.
406.
407.
408.
409.
410.
411.
412.

"TITLE IV—LEAD EXPOSURE REDUCTION
Definitions.
Lead-based paint activities training and certification.
Identification of dangeroiis levels of lead.
Authorized State programs.
Lead abatement and measiirement.
Lead hazard information pamphlet.
Regulations.
Control of lead-based paint hazards at Federal fiadlities.
Prohibited acts.
Relationship to other Federal law.
General provisions relating to administrative proceedings.
Authorization of appropriations.".

(c) SHORT TITLE.—This subtitle may be cited as the "LeadBased Paint Exposure Reduction Act".

Subtitle C—^Worker Protection
42 u s e 4853.

SEC. 1031. WORKER PROTECTION.

Regulations.

Not later than 180 days after the enactment of this Act, the
Secretary of Labor shall issue an interim final regulation regulating
occupational exposure to lead in the construction industiy. Such
interim final regulation shall provide employment and places of
emplo3mient to employees which are as safe and healthful as those
which would prevail under the Department of Housing and Urban
Development guidelines publishea at Federal Register 55, page
38973 (September 28, 1990) (Revised Chapter 8). Such interim
final regulations shall take effect upon issuance (except that such
regulations may include a reasonable delay in the effective date),
shall have the legal effect of an Occupational Safety and Health
Standard, and shall apply until a final standard becomes effective
under section 6 of the Occupational Safety and Health Act of
1970.

42 u s e 4853a.

SEC. 1032. COORDINATION BETWEEN ENVIRONMENTAL PROTECTION
AGENCY AND DEPARTMENT OF LABOR.

29 use 671.

The Secretary of Labor, in promulgating regulations imder
section 1031, shall consult and coordinate with the Administrator
of the Environmental Protection Agency for the purpose of achieving
the maximum enforcement of title IV of the Toxic Substances Control Act and the Occupational Safety and Health Act of 1970 while
imposing the least burdens of duplicative reqmrements on those
subject to such title and Act and for other purposes.
SEC. 1033. NIOSH RESPONSIBILITIES.
Section 22 of the Occupational Safety and Health Act of 1970
is amended by adding the following new subsection at the end
thereof:
"(g) LEAD-BASED PAINT ACTIVITIES.—

"(1)

TRAINING GRANT PROGRAM.—(A) The

Institute,

in

conjunction with the Administrator of the Environmental
Protection Agency, may make grants for the training and education of workers and supervisors who are or may be directly
engaged in lead-based paint activities.
"(B) Grants referred to in subparap-aph (A) shall be
awarded to nonprofit organizations (including colleges and
universities, joint labor-management trust funds. States, and
nonprofit government employee organizations)—
"(i) which are engaged in the training and education
of workers and supervisors who are or who may be directly

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3925

engaged in lead-based paint activities (as defined in title
IV of the Toxic Substances Control Act),
"(ii) which have demonstrated experience in
implementing and operating health and scuety training
ana education programs, and
"(iii) with a demonstrated ability to reach, and involve
in lead-based paint training programs, target populations
of individuals who are or will be engagedf in lead-based
paint activities.
Grants under this subsection shall be awarded onlv to those
organizations that fund at least 30 percent of their lead-based
paint activities training programs from non-Federal sources,
excluding in-kind contributions. Grants may^ also be made to
local governments to carry out such training and education
for their employees.
"(C) There are authorized to be appropriated, at a minimum, $10,000,000 to the Institute for each of the fiscal years
1994 through 1997 to make grants under this paragraph.
"(2) EVALUATION OF PROGRAMS.—The Institute shall conduct periodic and comprehensive assessments of the efficacy
of the worker and supervisor training pro-ams developed and
offered by those receiving grants under this section. The Director shall prepare reports on the results of these assessments
addressed to the Administrator of the Environmental Protection
Agency to include recommendations as may be appropriate
for the revision of these programs. The sum of $500,000 is
authorized to be appropriated to the Institute for each of the
fiscal years 1994 through 1997 to carry out this paragraph.".

Appropriation
authorization.

Appropriation
authorization.

Subtitle D—^Research and Development
PART 1—HUD RESEARCH
SEC. 1061. RESEARCH ON LEAD EXPOSURE FROM OTHER SOURCES.

42 USC 4854.

The Secretary, in cooperation with other Federal agencies, shall
conduct research on strategies to reduce the risk of lead exposure
from other sources, including exterior soil and interior lead dust
in carpets, furniture, and forced air ducts.
SEC. 1052. TESTING TECHNOLOGIES.

The Secretary, in cooperation with other Federal agencies, shall
conduct research to—
(1) develop improved methods for evaluating lead-based
paint hazards m housing;
(2) develop improved methods for reducing lead-based paint
hazards in housing;
(3) develop improved methods for measuring lead in paint
films, dust, and soil samples;
(4) establish performance standards for various detection
methods, including spot test kits;
(5) establish performance standards for lead-based paint
hazard reduction methods, including the use of encapsulants;
(6) establish appropriate cleanup standards;
(7) evaluate the efficacy of interim controls in various hazard situations;
(8) evaluate the relative performance of various abatement
techniques;

42 USC 4854a.

106 STAT. 3926

PUBLIC LAW 102-550—OCT. 28, 1992
(9) evaluate the long-term cost-effectiveness of interim control and abatement strategies; and
(10) assess the efife^iveness of hazard evaluation and
reduction activities funded by this Act.

42 u s e 4854b.

SEC. 10S3. AUTHORIZATION.

Of the total amoimt approved in appropriation Acts under
section 101 l(o), there shall oe set aside to cany out this ps^
$5,000,000 for fiscal year 1993, and $5,000,000 for fiscal year 1994.

PART 2--GAO REPORT
42 u s e 4855.

SEC. 10S6. FEDERAL IMPLEMENTATION AND INSURANCE STUDY.
(a) FEDERAL IMPLEMENTATION STUDY.—The Comptroller

General of the United Stetes shall assess the effectiveness of Federal
enforcement and compliance with lead safety laws and regulations,
including anv changes needed in annual inspection procedures to
identify lead-based paint hazards in units receiving assistance
under subsections (b) and (o) of section 8 of the United States
Housing Act of 1937.
(b) INSURANCE STUDY.—The Comptroller General of the United
Stetes shall assess the availability of liability insurance for owners
of residential housing that contains lead-based paint and persons
engaged in lead-based paint hazard evaluation and reduction activities. In carrying out the assessment, the Comptroller General
shall—
(1) analyze any precedente in the insurance industry for
the conteinment and abatement of environmentel hazards, such
as asbestos, in federally assisted housing;
(2) provide an assessment of the recent insurance experience in the public housing lead hazard identification and reduction program; and
(3) recommend measures for increasing the availability of
liability insurance to owners and contractors engaged in federally supported work.

Subtitle E—Reports
42 u s e 4856.

SEC. 1061. REPORTS OF THE SECRETARY OF HOUSING AND URBAN
DEVELOPMENT.
(a) ANNUAL REPORT.—^The Secretary shall transmit to the Con-

gress an annual report that—
(1) sete forth the Secretary's assessment of the progress
made in implementing the various programs authorized by
this title;
(2) summarizes the most current health and environmental
studies on childhood lead poisoning, including studies that analyze the relationship between interim control and abatement
activities and the incidence of lead poisoning in resident children;
(3) recommends legislative and administrative initiatives
that may improve the performance by the Department of Housing and Urban Development in combating lead hazards through
the expansion of lead hazard evaluation and reduction activities;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3927

(4) describes the results of research carried out in accordance with subtitle D; and
(5) estimates the amount of Federal assistance annually
expended on lead hazard evaluation and reduction activities.
(b) BIENNIAL REPORT.—

(1) IN GENERAL.—24 months after the date of enactment
of this Act, and at the end of every 24-month period thereafter,
the Secretary shall report to the Congress on the progress
of the Department of Housing and Lh*ban Development in
implementing expanded lead-based paint hazard evaluation and
reduction activities.
(2) CONTENTS.—The report shall—
(A) assess the effectiveness of section 1018 in making
the public aware of lead-based paint hazards;
(B) estimate the extent to which lead-based paint hazard evaluation and reduction activities are being conducted
in the various categories of housing;
(C) monitor and report expenditures for lead-based
paint hazard evaluation and reduction for programs within
the jurisdiction of the Department of Housing and Urban
Development;
(D) identify the infrastructure needed to eliminate
lead-based paint hazards in all housing as expeditiously
as possible, including cost-effective technology, standards
and regulations, trained and certified contractors, certified
laboratories, liability insurance, private financing techniques, and appropriate Government subsidies;
(E) assess the extent to which the infrastructure
described in subparagraph (D) exists, make recommendations to correct shortcomings, and provide estimates of
the costs of measures needed to build an adequate infrastructure; and
(F) include any additional information that the Secretary deems appropriate.

TITLE XI—NEW TOWNS DEMONSTRATION PROGRAM FOR EMERGENCY RELIEF OF LOS ANGELES
SEC. 1101. AUTHORITY.

To provide for the revitalization and renewal of inner city
neighborhoods in the areas of Los Angeles, California, that were
damaged by the civil disturbances during April and May of 1992,
and to demonstrate the effectiveness o t n e w town developments
in revitalizing and restoring depressed and underprivileged inner
city neighborhoods, the Secretary of Housing and Urban Development shall, to the extent or in such amounts as are provided
in appropriation Acts, make any assistance authorized under this
title available under this title to units of general local government,
governing boards, and eligible mortgagors in accordance with the
provisions of this title.
SEC. 1102. NEW TOWN PLAN.

(a) REQUIREMENT.—^The Secretary may make assistance available under this title only in connection with, and according to

59-194

O—93

10 : QL 3 (Pt. 5)

California.
42 u s e 5318
note.

106 STAT. 3928

PUBLIC LAW 102-550—OCT. 28, 1992

the provisions of a new town plan developed and established by
a governing board under section 1107 and approved iinder subsection (d) of this section. In developing such plans, the governing
board shall consult with representatives of tne units of general
local government within whose boundaries are located any portion
of the new town demonstration area for the demonstration program
to be carried out under such plan.
(b) ELIGIBLE NEW TOWN DEMONSTRATION AREAS.—A new town
plan under this section shall provide for carrying out a new town
development demonstration providing assistance available under
this title within a new town demonstration area, which shall be
a geographic area defined in the new town plan—
(1) that is one of pervasive poverty, unemployment, and
general distress;
(2) that has an imemployment rate of not less than 1.5
times the national unemployment rate for tlie 2 years preceding
approval of the new town plan;
(3) that has a poverty rate of not less than 20 percent
during such 2-year period;
(4) for wluch not less than 70 percent of the households
living in the area have incomes below 80 percent of the median
income of households of the unit of general local government
in which they are located;
(5) that has a shortage of adequate jobs for residents;
and
(6) that is located—
(A) in or near the City or County of Los Angeles,
in the State of California; and
(B) within an area for which the President, pursuant
to title IV or V of the Robert T. Stafford Disaster Relief
and Emergency Assistance Act, declared that a miyor disaster or emergency existed for purposes of such Act, as a
result of the civil disturbances involving acts of violence
occurring on or after April 29, 1992, and before May 6,
1992.
(c) CONTENTS.—^Each new town plan shall include the following
information:
(1) GOVERNING BOARD.—^A description of the members and
purposes of the governing board that developed the plan, the
manner in which members of the governing boiard were selected,
and the businesses, agencies, interests, and commimity ties
of each member of the governing board.
(2) NEW TOWN DEMONSTRATION AREA.—A definition and
description of the new town demonstration area for the new
town development demonstration to be assisted under this title.
(3) TARGET COMMUNITY.—A description of the economic,
social, racial, and ethnic characteristics of the population of
the neighborhood or area in which the new town demonstration
area is located.
(4) AGREEMENTS.—Agreements that the governing board
will cany out the new town demonstration program in accordance with tiie requirements of this title.
(5) HOUSING UNITS.—A description of the number, size,
location, cost, style, and characteristics of rental and
homeownership housing units to be developed under the new
town demonstration program, anyfinancingfor developing such

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3929

housing, and the amount of assistance necessary under section
1105 for developing the housing under the program.
(6) JOBS.—^A description of the number, types, and duration
of any new jobs that will be created in the new town demonstration area and surroimding areas as a result of the
demonstration program, and of any job training activities and
apprenticeship programs to be made available in connection
with the program.
(7) SOCIAL SERVICES.—^A description of the social and
supportive services to be made available under the demonstration program to residents of housing assisted under the demonstration program pursuant to section 1103(d) and to residents
of the new town demonstration area.
(8) SUPPLEMENT.\L RESOURCES.—A description of any funds,
assistance, in-kind contributions, and other resources to be
made available in connection with the demonstration program,
including the sources and amounts of any private capital
resources and non-Federal fluids required imder section
1103(h).
(9) CONTRACTORS AND DEVELOPERS.—A listing of the contractors and developers who potentially will carry out any
construction and rehabilitation work for development of housing
under the demonstration program and the expected costs
involved in hiring such contractors and developers.
(10) FINANCING FOR HOMEBUYERS.—A description of any

mortgage lenders who have indicated that they will make
financing available to families purchasing housing developed
imder the demonstration program through mortgages eligible
for insurance under section 1104 and proposed terms of such
mortgages.
(11) COMMITMENTS.—Evidence of any commitments entered
into for meiking any of the resources described in paragraphs
(6) through (8) available in connection with the demonstration
program.
(12) PRESALE REQUIREMENTS.—A description of commitments made to purchase not less than 50 percent of the housing
to be developed imder the demonstration program for purchase
by the occupant and to rent not less than 50 percent of the
rental dwelling units to be developed under the demonstration
program.
(13) COMMUNITY DEVELOPMENT ACTIVITIES.-A description

of the community development activities to be carried out with
assistance under section 1106, the amount of assistance necessary under such section for such activities, and of the projectea uses of such assistance.
(d) REVIEW AND APPROVAL.—

(1) SUBMISSION.—Not later than the expiration of the 6month period beginning on the date of the enactment of this
Act, a governing board shall submit a new town plan under
this section to the chief executive officers of each unit of genersd
local government within whose boundaries is located any portion of the new to^n demonstration area described under the
plan of the board.
(2) APPROVAL.—^For a plan to be eligible for assistance
available imder this title, the chief executive officer of all units
of general local government to whom the new town plan is
submitted shall approve the plan at a public meeting after

106 STAT. 3930

PUBLIC LAW 102-550—OCT. 28, 1992
the plan has been made publicly available for a period of
not less than 30 days. A governing board may resubmit for
approval any plan returned by any such chief executive officer
to the govemmg board, and such chief executive officer may,
upon returning the plan indicate any modifications necessary
for approval. A new town plan may not be approved unless
such cnief executive officers determine that the membership
of the governing board submitting the plan is constituted in
accordance with section 1107 and the governing board is
capable of carrying out the plan.
(3) AMENDMENT.—An approved new town plan for the demonstration program developed by the governing board may be
amended by the board by obtaining approval of the amendment
in the manner provided under tnis subsection for approval
of plans. If the chief executive officer of the unit of general
local government does not approve or return the amend^ plan
within 30 days of submission, the amended plan shall be considered to be approved for purposes of this subsection.

SEC. 1108. NEW TOWN DEVELOPMENT DEMONSTRATION PROGRAM
REQUIREMENTS.

(a) IN GENERAL.—^Each of the 2 new tovm development demonstration programs selected for assistance under this title under
section 1102 shall be carried out, by the governing board submitting
the new town plan for the demonstration program, in accordance
with such plan (and any approved amendments of such plans)
and shall be subject to the requirements under this section.
(b) LOCAL PARTICIPATION.—^With respect to any activities carried out under the demonstration program, the program shall give
preference in awarding contracts, purchasing materials, acquiring
services, and obtaining assistance or training, to contractors,
businesses, developers, professionals, and other establishments
located or having offices within the new town demonstration area.
(c) HOUSING.—
(1) NUMBER OF UNITS.—^The demonstration program shall

construct or renovate not less than 1,500 dwelling imits in
the new town demonstration area, of which not less than 60
percent shall be units available for purchase by the occupant.
(2) AFFORDABiLnY.—^Units of varying sizes and costs shall
be designed and developed under the demonstration program
so that the program provides housing affordable to families
of varying incomes not exceeding 115 percent of the median
income for the area in which the new town demonstration
area is located, including very low- and low-income families
(as such terms are defined in section 3(b) of the United States
Housing Act of 1937).
(3) HOMEOWNERSmP UNITS.—^Dwelling units developed
under the demonstration program for purchase by the occupant
shall initially be sold at prices affordable to families eligible
to purchase such units. Such units shall be available for purchfuse only^ by families having incomes not exceeding the amount
spedfied in paragraph (2). The demonstration snail develop
2-, 3-, and 4-bedroom units for purchase.
(4) RENTAL UNITS.—^Dwelling units developed under the
demonstration program that are to be available for rental shall
include family-type units and single bedroom and efficiencr^
units designed for elderly occupants. Such units shall be avail-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3931

able for occupancy only by families who (upon initial occupancy)
have incomes of (A) less than 60 percent of the median income
for the area, or (B) less than $20,000. Occupant families shall
pay not more than 30 percent of the family income for rent.
(d) SOCIAL SERVICES.—^The demonstration program shall provide for appropriate social and supportive services to be made
available to residents of housing assisted under the demonstration
program and to other residents of the new town demonstration
area, which may include rental and homeownership counseling,
child care, job placement, educational programs, recreational and
health care facilities and programs, and other appropriate services.
(e) JOB CREATION AND TRAINING.—^The demonstration program
shall provide, to the extent practicable, that activities in connection
with the demonstration program, including development of housing
under subsection (c) and community development activities assisted
under section 1106, shall employ and provide job training opportimities for residents of the housing assisted under the demonstration
program and other residents of the new town demonstration area.
(f) FINANCING.—^The demonstration program shall provide for
coordination with banks, credit unions, and other mortgage lenders
to make financing available to purchasers of units developed under
the demonstration program through mortgages eligible for insurance
under section 1104, and shall give preference to such mortgage
lenders who have offices located within or near the new town
demonstration area.
(g) SUPPORT FACILITIES.—The demonstration program shall
encourage, facilitate, and provide for development of appropriate
support facilities to serve residents in the housing developed under
the program, including infrastructure and commercial facilities.
(n) NON-FEDERAL FtJNDS.—^The governing board carrying out
the demonstration program shall ensure that not less than 25
percent of the total amounts used to carry out the demonstration
)rogram is provided from non-Federal sources, including State or
ocal government funds, any salary paid to staff to carry out the
demonstration program, the value of any time, services, and materials donated to carry out the program, the value of any donated
building, and the value of any lease on a building.

f

SEC. 1104. FEDERAL MORTGAGE INSURANCE.

(a) IN GENERAL.—^Pursuant to title II and section 251 of the
National Housing Act, the Secretary shall (to the extent authority
is available pursuant to subsection (d)) insure mortgages under
this section involving properties upon which are located dwelling
units described in section 1103(cX3) of this Act that are developed
under the new town demonstration programs carried out pursuant
to this title.
(b) MORTGAGE TERMS.—^Mortgages insured under this section
shall—
(1) provide for periodic adjustments in the effective rate
ofinterest charged, which—
(A) for the first 5 years of the mortgage, shall be
an annual rate of not more than 7 percent; and
(B) after the expiration of such 5-year period, may
increase on an annual basis, but—
(i) shall be limiteid, with respect to any single
interest rate increase, to not more than a 10-percent
increase in the annual percentage rate; and

106 STAT. 3932

PUBLIC LAW 102-550—OCT. 28, 1992

(ii) may not be increased at any time to a rate
greater than the rate necessary at such time to fully
amortize the outstanding loan balance over the term
of the mortgage; and
(2) have a maturity of 35 years firom the date of the
beginning of the amortization of the mortgage.
(c) BOARD APPROVAL.—^The Secretary may provide insurance
under this section for a mortgage only if the governing board
for the demonstration program for the new town demonstration
area in which the property subject to the mortgage is located
has indicated to the Secretary approval of the mortage in connection with the demonstration program.
(d) INSURANCE AUTHORITY.—To the extent provided in appropriation Acts, the Secretary shall use any authority provided pursuant to section 531(b) of the National Housing Act to enter into
commitments to insiire loans and mortgages under this section
in fiscal years 1993 and 1994 with an aggregate principcQ amount
not exceeding such sums as may be necessary to carry out the
demonstration imder this title. Mortgages insiu'ed under this section
shall not be considered for purposes of the aggregate limitation
on the number of mortgages insured imder section 251 of the
National Housing Act specified in subsection (c) of such section.
SEC. IIOS. SECONDARY SOFT MORTGAGE FINANCING FOR HOUSING.

(a) IN GENERAL.—^The Secretary shall, to the extent amounts
are provided in appropriation Acts imder subsection (e), provide
assistance imder this section through the governing boards carrying
out the new town demonstration programs under this section to
assist in the development of housing under the program.
(b) USE.—^Any assistance provided imder this section shall be
used only for costs in planning, developing, constructing, and
rehabilitating housing imder the demonstration program available
for rental or purchase by the occupant. The governing board shall
determine, according to the new town plan for the demonstration
program, the allocation of amounts of assistance provided under
this section.
(c) AMOUNT.—^The Secretary may not provide assistance under
this section for the development of housing under a demonstration
program in an amount exceeding $50,000 per dwelling unit assisted.
(d) SECOND MORTGAGE.—

(1) IN GENERAL.—^Assistance under this section shall be
repaid in accordance with this subsection. Repayment of the
amount of any assistance provided with respect t o ^
(A) any building containing rental units, or
(B) any dwelling unit available for purchase by the
occupant that is developed under a demonstration program,
shall be secured by a second mortgage held by the Secretary
on the property involved.
(2) TERMS.—During the period ending upon repayment of
the assistance as provided in this subsection, any building
containing rental units that is provided assistance under this
section shall be used as rental nousing subject to the requirements of section 1103(cX4). During the period ending upon
repa3anent of the assistance as provided in this subsection,
any dwelling unit made available for purchase by the occupant
that is provided assistance under tnis section may be sold

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3933

only to a fcLinily having an income not exceeding the amount
specified in section 1103(cX2).
(3) INTEREST.—Any assistance provided under this section
for a building or dwelling unit shall bear interest at a rate
equivalent to the rate for the most recently marketable obligations issued by the United States Treasury have terms of
10 years. The interest on such assistance shall be required
to be repaid only upon s£de of the building.
(4) DISCOUNTED REPAYMENT.—The assistance provided
under this section for any building containing rental units
or any dwelling unit available for purchase by the occupant
shall be considered to have been repaid for purposes of this
subsection if the original purchaser of the building or the dwelling unit pays to the Secretary an amount equal to 50 percent
of the amount of the assistance provided under this section.
(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated for fiscal years 1993 and 1994 such sums as
may be necessary for providing assistance under this section.
SEC. 1106. COMMUNITY DEVELOPMENT ASSISTANCE.

(a) IN GENERAL.—^Tlie Secretary shall provide assistance under
this section, to the extent amounts are provided in appropriation
Acts under subsection (h), to units of general local government
to address vital unmet needs and to promote the creation of jobs
and economic development in connection with the new town demonstration programs canied out under this title.
(b) EuGiBLE UNITS OF GENERAL LOCAL GOVERNMENT.—Assist-

ance may be provided imder this section only to units of general
local government—
(1) within whose boundaries are located any portion of
the new town demonstration areas described under the new
town demonstration plans for the demonstration programs carried out under this title;
(2) that make the certifications to the Secretary required
under subsection (c); and
(3) that will comply with a residential antidisplacement
and relocation assist;ance plan described in subsection (d).
(c) REQUIRED CERTIFICATIONS.—The certifications referred to
in subsection (bX2) shall be certifications that—
(1) the assistance will be conducted and administered in
conformity with the Civil Rights Act of 1964 and the Civil
Rights Act of 1968, and the unit of general local government
will affirmatively further fair housing;
(2) the project(id use of funds has been developed in a
manner that gives maximum feasible priority to activities which
are designed to meet commimity development needs that have
been delayed because of the lack of fiscal resources of the
unit of general local government or which are designed to
address conditions that pose a serious and immediate threat
to the health or welfare 01 the community;
(3) any projected use of funds for public services will benefit
primarily low- and moderate-income families;
(4) the unit of general local government will not attempt
to recover any capital costs of public improvements assisted
in whole or part under this section by assessing any amount
against properties owned and occupied by persons of low- and
moderate-income, including any fee charged or assessment

106 STAT. 3934

PUBLIC LAW 102-550—OCT. 28, 1992
made as a condition of obtaining access to such public improvements, unless—
(A) funds received under this section are used to pay
the proportion of such fee or assessment that relates to
the capital costs of such public improvements that are
financed from revenue sources other than under this section; or
(B) for purposes of assessing any amount against properties owned and occupied by persons of moderate income,
the grantee certifies to the Secretary that it lacks sufficient
fimds received under this section to comply with the
requirements of subparagraph (A); and
(5) the unit of general local government will comply with
the other provisions of this title and with other applicable
laws,
(d) A^^^DISPLACEME^^^ AND RELOCATION PLAN.—
(1) CONTENTS.—^The residential antidisplacement and
relocation assistence plan referred to in subsection (b)(3) shall,
in connection with activities assisted under this section—
(A) provide that, in the event of such displacement—
(i) govemmentel agencies or private developers
shall provide, within the same commimity, comparable
replacement dwellings for the same number of occupants as could have been housed in the occupied and
vacant occupiable low- and moderate-income dwelling
imits demolished or converted to a use other than
for housing for low- and moderate-income persons, and
provide that such replacement housing may include
existing housing assisted with project based assistance
provided under section 8 of the United Stetes Housing
Act of 1937;
(ii) such comparable replacement dwellings shall
be designed to remain affordable to persons of lowand moderate-income for 10 years from the time of
initial occupancy;
(iii) relocation benefits shall be provided for all
low- or moderate-income persons who occupied housing
demolished or converted to a use other than for lowor moderate-income housing, including reimbursement
for actual and reasonable moving expenses, security
deposits, credit checks, and other moving-related
expenses, including any interim living costs; and in
the case of displaced persons of low- and moderateincome, provide either—
(I) compensation sufficient to ensure that, for
a 5-year period, the displaced families shall not
bear, after relocation, a ratio of shelter coste to
income that exceeds 30 percent; or
(II) if elected by a family, a lump-sum payment
equal to the capitelized value of the benefits available under subclause (I) to permit the household
to secure participation in a housing cooperative
or mutual housing association; and
(iv) persons displaced shall be relocated into comparable replacement housing that is—
(I) decent, safe, and sanitery;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3935

(II) adequate in size to accommodate the occupants;
(III) functionally equivalent; and
(IV) in an area not subject to unreasonably
adverse environmental conditions; and
(B) provide tliat persons displaced shall have the right
to elect, as an alternative to the benefits under this subsection, to receive benefits imder the Uniform Relocation
Assistance and Real Property Acquisition Policies Act of
1970 if such persons determine m a t it is in their best
interest to do so; and
(C) provide that where a claim for assistance under
subparagraph (AXiv) is denied by the unit of general local
government, the claimant may appeal to the Secretary,
and that the decision of the Secretary shall be final unless
a court determines the decision was arbitrary and capricious.
(2) EXCEPTION.—Paragraphs (IXAXi) and (IXAXii) shall
not apply in any case in which the Secretary finds, on the
basis of objective data, that there is available in the area
an adequate supply of habitable affordable housing for lowand moderate-income persons. A determination under this paragraph shall be final and nonreviewable.
(e) ELIGIBLE ACTIVITIES.—^Activities assisted with amounts provided under this section may include only the following activities:
(1) ACQUISITION OF REAL PROPERTY.—The acquisition of

real property (including air rights, water rights, and other
interests therein) that is located within the new town demonstration area and is—
(A) blighted, deteriorated, imdeveloped, or inappropriately developed from the standpoint of sound community
development and growth;
(B) appropriate for rehabilitation activities;
(C) appropriate for the preservation or restoration of
historic sites, the beautification of urban land, the conservation of open spaces, natural resources, and scenic
areas, the provision of recreational opportunities, or the
guidance of urban development;
(D) to be used for the provision of public works, facilities, and improvements eligible for assistance imder this
section;
(E) to be used as a facility for coordinating and providing activities and services for high risk youth (as such
term is defined in section 509A of the Public Health Service
Act); or
(F) to be used for other public purposes.
(2) CONSTRUCTION OF PUBLIC WORKS AND FACILITIES.—The

acquisition, construction, rehabilitation, or installation of public
works or public facilities within the new town demonstration
area, including buildings for the general conduct of government
and facilities for coordinating ana providing activities and services for high risk youth (as such term is defined in section
509A of the Public Health Service Act).
(3) CLEARANCE AND REHABILITATION OF BUILDINGS.—The

clearance, removal, and rehabilitation of buildings and improvements located within the new town demonstration area, including interim assistance, assistance for facilities for coordinating

106 STAT. 3936

PUBLIC LAW 102-550—OCT. 28, 1992
and providing activities and services for high risk youth (as
such term is defined in section 509A of tine Public Health
Service Act), and assistance to privately owned buildings and
improvements.
(4) PROVISION OF PUBUC SERVICES AND HOUSING.—
(A) PUBLIC SERVICES.—^The provision of public

services
within the new town demonstration area that are concerned
with job training and retraining, health care and education,
crime prevention, drug abuse treatment and rehabilitation,
child care, education, and recreation, which may include
the provision of public health andpublic safety vehicles.
(B) HOUSING AcnvmES.—The acquisition and
rehabilitation of housing for low- and moderate-income
families within the new town demonstration area, except
that any grantee that uses amounts received under this
section for housing activities under this subparagraph shall
make not less than 15 percent of the amount used for
such housing activities available only for community housing development organizations and nonprofit organizations
(as such terms are defined in section 104 of the CranstonGonzalez National Affordable Housing Act) for such activities;
(C) LIMITATION.—^Not more than 25 percent of the
amount of any assistance provided under this section
(including program income) to any unit of general local
government may be used for activities under this paragraph.
(5) RELOCATION ASSISTANCE.—Relocation payments and
assistance for individuals, families, business, and organizations
that are displaced as a result of activities assisted under this
title.
(6) PAYMENT OF ADMINISTRATIVE EXPENSES.—Payment of

reasonable administrative costs associated with activities
assisted under this section and any expenses of developing
the new town plan under section 1102.
(0 ALLOCATION OF ASSISTANCE.—The Secretary mav not provide
more than 50 percent of any amounts appropriated imder this
section in connection with any one of the 2 new town demonstration
programs carried out under this title.
(g) OTHER REQUIREMENTS.—The provisions of subsections (f),
(g), and (h) of section 104, subsections (c) and (d) of section 105,
section 107, 108, 109, and 110 of the bill, H.R. 4073, 102d Congress
(as reported on March 14, 1992, l^ the Committee on Banking,
Finance and Urban Affairs of the House of Representatives), shsul
applytograntees receiving assistance imder this section.
(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated for fiscal years 1993 and 1994 such sums as
may be necessaiy for assistance under this section.
SEC. 1107. GOVERNING BOARDS.

(a) PURPOSE.—^For purposes of this title, a governing board
shall be a board organized for the purpose of developing a new
town plan under this title and carrying out a new town development
demonstration under this title.
(b) MEMBERSHIP.—^Each governing board shall consist of not
less tlian 10 members, who sh^l include—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3937

(1) residents of the area in which the new town demonstration area under the plan developed by the board is located;
(2) owners of business in such area;
(3) leaders or participants in community groups in such
area; and
(4) representatives of financial institutions located or having offices in such area.
(c) ORGANIZATION.—^A governing board may organize itself and
conduct business in the manner that the board determines is appropriate to carry out the new town development demonstration under
this title.
SEC. 1108. REPORTS.
Each governing board carrying out a new town development
demonstration imder this title shall submit to the Congress the
following information:
(1) NEW TOWN PLAN.—^Upon approval of the new town

plan of the governing board under section 1102(d), a copy
of the approved plan.
(2) ANNUAL REPORTS.—For the 5-year period beginning
upon the approval of the new town plan, annual reports for
each 12-month period during such 5-year period, which shall
be submitted within 3 months after the expiration of the 12month period. Each report shall include a description of any
activities during such period to carry out the demonstration
program of the governing board, the use during such period
of any assistance provided under this title, and any amendments under section 1102(dX4) to the new town plan approved
during such period.
SEC. 1109. DEFINrnONS.
For purposes of this title:
(1) DEMONSTRATION PROGRAM.—The terms "demonstration

program" and "program" mean a new town development demonstration program receiving assistance under this title, which
is carried out within a new town demonstration area by a
governing board.
(2) (^VERNING BOARD.—^The term "governing board" means
a board established under section 1107.
(3) NEW TOWN DEMONSTRATION AREA.—The term "new town
demonstration area" means the area defined in a new town
plan in which the new town development demonstration imder
the plan is to be carried out.
(4) NEW TOWN PLAN.—The terms "new town plan" and

"plan" mean a plan under section 1102 developed by a governing
board.
(5) UNIT OF GENERAL LOCAL GOVERNMENT.^The term "unit
of general local government" means any city, county, town,
township, parish, village, or other general piupose political
subdivision of the State of California.

106 STAT. 3938
Removal of
Regulatory
Barriers to
Affordable
Housing Act of
1992.
Intergovernmental
relations.
42 u s e 12705a
note.
42 u s e 12705a.

PUBLIC LAW 102-550—OCT. 28, 1992

TITLE XII—REMOVAL OF REGULATORY
BARRIERS TO AFFORDABLE HOUSING
SEC. 1201. SHORT TITLE.

This title may be cited as the liemoval of Regulatory Barriers
to Affordable Housing Act of 1992".
SEC. 1202. PURPOSES.

The purposes of this title are—
(1) to encourage State and local governments to further
identify and remove regulatory barriers to affordable hoiising
(including barriers that are excessive, unnecessary, duplicative,
or exclusionary) that significantly increase housing costs and
limit the supply of affordable housing; and
(2) to strengthen the connection between Federal housing
assistance and state and local efforts to identify and eliminate
regulatory barriers.
42 u s e 12705b.

SEC. 1203. DEFINITION OF REGULATORY BARRIERS TO AFFORDABLE
HOUSING.

For purposes of this title, the terms "regulatory barriers to
affordable housing" and "regulatory barriers" mean any public policies (including policies embodied in statutes, ordinances, regulations, or administrative procedures or processes) required to be
identified by a jurisdiction in connection with its comprehensive
housing affordability strategy under section 105(bX4) of the Cranston-Gronzalez National Affordable Housing Act. Such terms do not
include policies relating to rents imposed on a structure by a jurisdiction or policies that have servea to create or preserve, or can
be shown to create or preserve, housing for low- and very lowincome families, including displacement protections, demolition
controls, replacement housing requirements, relocation benefits,
housing trust funds, dedicated funding sources, waiver of local
property taxes and builder fees, inclusionary zoning, rental zoning
overlays, long-term use restrictions, and rights of first refusal.
42 u s e 12705c.

SEC. 1204. GRANTS FOR REGULATORY BARRIER REMOVAL STRATEGIES AND IMPLEMENTATION.

(a) IN GENERAL.—^The amounts set aside under section 107
of the Housing and Community Development Act of 1974 for the
purpose of this subsection shall be available for grants under subsection (b) and (c).
(b) STATE GRANTS.—^The Secretary ra&y make grants to States
for the costs of developing and implementmg strategies to remove
regulatory barriers to affordable housing, including the costs of—
(1) identifying, assessing, and monitoring State and local
regulatonr barriers;
(2) identifying State and local policies (including laws and
regulations) that permit or encourage regulatory barriers;
(3) developing legislation to provide a State program to
reduce State and local regulatory barriers and developing a
strategy for adoption of such legislation;
(4) developmg model State standards and ordinances to
reduce regulatory barriers and assisting in the adoption and
use of the standards and ordinances;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3939

(5) carrying out the simplification and consolidation of State
administrative procedures and processes constituting regulatory
barriers to affordable housing, including the issuance of permits; and
(6) providing technical assistance and information to units
of general local government for implementation of legislative
and administrative reform programs to remove regulatory barriers to affordable housing.
(c) LOCAL GRANTS.—The Secretary may make grants to units
of general local government for the costs of enveloping and
implementing strategies to remove regulatory barriers to affordable
housing, including the costs of—
(1) identifying, assessing, and monitoring local regulatory
barriers;
(2) identifying local policies (including laws and regulations) that permit or encourage regulatory barriers;
(3) developing legislation to provide a local program to
reduce local regulatory barriers and developing a strategy for
adoption of such legislation;
(4) developing model local standards and ordinances to
reduce regulatory barriers and assisting in the adoption and
use of the standards and ordinances; and
(5) carrying out the simplification and consolidation of local
administrative procedures and processes constituting regulatory
barriers to affordable housing, including the issuance of
permits.
(d) DEFINITION.—For purposes of this section, the terms "regulatory barriers to affordable housing" and "regulatory barriers"
have the meaning given such terms in section 1203.
(e) APPLICATION AND SELECTION.—The Secretary shall provide
for the form and manner of applications for grants imder this
section, which shall describe how grant amounts will assist the
State or unit of general local government in developing and
implementing strategies to remove regulatory barriers to affordable
housing. The Secretary shall establish criteria for approval of
applications imder this subsection and for the selection of imits
of general local government to receive grants under subsection
(fX2).
(0 ALLOCATION OF AMOUNTS.—
(1) STATE GRANTS.—

(A) IN GENERAL.—Of the total amount appropriated
for each fiscal year to carry out this subsection, the Secretary shall use two-thirdja of such amount to provide
grants vmder subsection (b) to each State submitting an
application that is approved by the Secretary. Such
amounts shall be allocated among the States based upon
the measure of need (for the whole State) of each State,
as determined imder section 217(bXlXA) (excluding adjustments under section 217(bXlXD)) of the Cranston-Gonzalez
National Affordable Housing Act, except that the minimimi
grant amount for each fiscal year grant shall be $100,000
(to the extent sufficient amounts are made available).
(B) PRO RATA DISTRIBUTION.—If insufficient amounts

are made available for grants in the amoimt under subparagraph (A) to each State submitting an approved application,
each such State shall receive a pro rata portion of such

106 STAT. 3940
•

I

42 u s e 12705d.

PUBLIC LAW 102-550—OCT. 28, 1992

amount based on the ratio of the population of such State
to the population of all States.
(2) LOCAL GRANTS.—Of the total amount appropriated for
each fiscal year to carry out tMs section, the Secretary shall
use one-third of such amount to provide grants on a competitive
basis to units of general local government based on the proposed
uses of such amounts, as provided in the application. Each
grant made with such amounts shall be in an amount not
less than $10,000.
(g) COORDINATION WITH CLEARINGHOUSE.—Each State and unit
of general local government receiving a grant under this section,
shall consult, coordinate, and exchange information with tiie
clearinghouse estabUshed under section 1205.
(h) REPORTS TO SECRETARY.—Each State and unit of general
local government receiving a grant under this section shall submit
a report to the Secretary, not less than 12 months after receiving
the grant, describing any activities carried out with the grant
amounts. The report shall contain an assessment of the impact
of any regulatory barriers identified by the grantee on the housing
patterns of minorities.
(i) CONFORMING AMENDMENTS.—The first sentence of section
106(dXl) of the Housing and Commimity Development Act of 1974
(42 U.S.C. 5306(dXl)) is amended by striking "for grants" and
all that follows through "(2))" and inserting 'rhat remains after
allocations pursuant to paragraphs (1) and (2) of subsection (a)".
SEC. 1206. REGULATORY BARRIERS CLEARINGHOUSE.

(a) ESTABUSHMENT.-The Secretary of Housing and Urban
Development shall establish a clearinghouse to receive, collect, process, and assemble information regarding—
(1) State and local laws, regulations, and policies affecting
the development, maintenance, improvement, availability, or
cost of affordable housing, including tax policies affecting land
and other property, land use controls, zomng ordinances, Duilding codes, fees and charges, growth limits, and policies that
affect the return on investment in residential property;
(2) State and local activities, strategies, ana plans to
remove or ameliorate the negative effects, if any, of such laws,
regulations, and policies; and
(3) State and local strategies, activities and plans that
promote affordable housing and housing dese^gation.
(b) FUNCTIONS.—^The clearinghouse estabhshed imder subsection (a) shall—
(1) respond to inquiries from State and local governments,
other organizations, and individuals requesting information
regarding State and local laws, regulations, policies, activities,
strategies, and plans described in subsection (a); and
(2) provide assistance in identifying, examining, and understanding such laws, regulations, policies, activities, strategies,
and plans.
SEC. 1206. SUBSTANTIALLY EQUIVALENT FEDERAL AND STATE BAR.
RIER ASSESSMENT REMOVAL REQUIREMENTS.

Section 105(bX4) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12705(bX4)) is amended by inserting before
the semicolon at the end the following: ", except that, if a State
requires a imit of general local government to submit a regulatory
barrier assessment that is substantially equivalent to the informa-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3941

tion required under this paragraph, as determined by the Secretary,
the unit of general local government may submit its assessment
submitted to the State to the Secretary and shall be considered
to have complied with this paragraph".
SEC. 1207. REPORTS BY SECRETARY.

Not later than 2 years after the date of enactment of this
Act, the Secretary of Housing and Urban Development shall submit
a report to the Congress. The report shall—
(1) describe any successful State and local strategies for
the removal of barriers to affordable housing;
(2) assess the impact of identified regulatory barriers on
the housing patterns of minorities; and
(3) describe anv strategies developed or implemented by
the Department of Mousing and Urban Development for reducing barriers to affordable housing imposed by the Federal
Grovemment.

TITLE XIII—GOVERNMENT SPONSORED
ENTERPRISES
SEC. 1301. SHORT TITLE.

This title may be cited as the ''Federal Housing Enterprises
Financial Safety and Soundness Act of 1992".
SEC. 1302. CONGRESSIONiikL FINDINGS.

The Congress finds that—
(1) the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation (referred to in this
section collectively as the "enterprises"), and the Federal Home
Loan Banks (referred to in this section as the "Banks"), have
important public missions that are reflected in the statutes
and charter Acts establishing the Banks and the enterprises;
(2) because the continued ability of the Federal National
Mortgage Association and the Federal Home Loan Mortgage
Corporation to accomj^lish their public missions is important
to proViding housing in the United States and the health of
the Nation^ economy, more effective Federal regulation is
needed to reduce the risk of failure of the enterprises;
(3) considering the current operating procedures of the
Federal National Mortgage Association, the Federal Home Loan
Mortgage Corporation, and the Federcd Home Loan Banks,
the enterprises and the Banks currently pose low financial
risk of insolvency;
(4) neither tne enterprises nor the Banks, nor any securities
or obligations issued by the enterprises or the Banks, are
backed by the full faith and credit of tne United Stetes;
(5) an entity regulating the Federal National Mortgage
Association and the Federal Home Loan Mortgage Corporation
should have sufficient autonomy from the enterprises and special interest groups;
(6) an entity regulating such enterprises should have the
authority to esteblish capital standards, require financial disclosure, prescribe adequate standards for books and records and
other mtemal controls, conduct examinations when necessary,

42 u s e 12705a
note.

Federal
Housing
Enterprises
Financial
Safety and
Soundness Act
of 1992.
12 u s e 4501
note.
12 u s e 4501.

106 STAT. 3942

PUBLIC LAW 102-550—OCT. 28, 1992
and enforce compliance with the standards and rules that it
establishes;
(7) the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation have an affirmative
obligation to facilitate the financing of affordable housing for
low- and moderate-income families in a manner consistent with
their overall public purposes, while maintaining a strong financial condition and a reasonable economic return; and
(8) the Federal Home Loan Bank Act should be amended
to emphasize that providing for financial safety and soundness
of the Federal Home Loan Banks is the primary mission of
the Federal Housing Finance Board.

12 u s e 4502.

SEC. 1303. DEFINITIONS.

For purposes of this title:
(1) AFFILIATE.—Except as provided by the Director, the
term "affiliate" means any entity that controls, is controlled
by, or is under common control with, an enterprise.
(2) CAPITAL DISTRIBUTION.—

(A) IN GENERAL.—The term "capital distribution"
means—
(i) any dividend or other distribution in cash or
in kind made with respect to any shares of, or other
ownership interest in, an enterprise, except a dividend
consisting only of shares of the enterprise;
(ii) any payment made by an enterprise to
repurchase, redeem, retire, or otherwise acquire any
of its shares, including any extension of credit made
to finance an acquisition by the enterprise of such
shares; and
(iii) any transaction that the Director determines
by regulation to be, in substance, the distribution of
capital.
(B) EXCEPTION.—Any payment made by an enterprise
to repurchase its shares for the purpose of fulfilling an
obligation of the enterprise under an employee stock ownership plan that is qualified under section 401 of the Internal
Revenue Code of 1986 or any substantially equivalent plan,
as determined by the Director, shall not be considered
a capital distribution.
(3) COMPENSATION.—^The term "compensation" means any
pa)rment of money or the provision of any other thing of current
or potential value in connection with employment.
(4) CORE CAPITAL.—^The term "core capital" means, with
respect to an enterprise, the sum of the following (as determined
in accordance with generally accepted accounting principles):
(A) The par or stated value of outstanding common
stock.
(B) The par or stated value of outstanding perpetual,
noncumulative preferred stock.
(C) Paid-in capital.
(D) Retained earnings.
The core capital of an enterprise shall not include any amounts
that the enterprise could be required to pay, at the option
of investors, to retire capital instruments.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3943

(5) DIRECTOR.—^The term "Director" means the Director
of the Office of Federal Housing Enterprise Oversight of the
Department of Housingand Urban Development.
(6) ENTERPRISE.—^Tlie term "enterprise" means—
(A) the Federal National Mortage Association and
any affiliate thereof; and
(B) the Federal Home Loan Mortgage Corporation and
any affiliate thereof.
(7) EXECUTIVE OFFICER.—The term "executive officer"
means, with respect to an enterprise, the chairman of the
board of directors, chief executive officer, chief financial officer,
president, vice chairman, any executive vice president, and
any senior vice president in charge of a principal business
unit, division, or function.
(8) LOW-INCOME.—The term "low-income" means—
(A) in the case of owner-occupied units, income not
in excess of 80 percent of area median income; and
(B) in the case of rental units, income not in excess
of 80 percent of area median income, with acyustments
for smaller and larger families, as determined by the
Secretary.
(9) MEDIAN INCOME.—The term "median income" means,
with respect to an area, the unadjusted median family income
for the area, as determined and published annually by the
Secretary.
(10) MODERATE-INCOME.—The term "moderate-income"
means—
(A) in the case of owner-occupied units, income not
in excess of area median income; and
(B) in the case of rental units, income not in excess
of £irea median income, with adjustments for smaller and
larger families, as determined by the Secretary.
(11) MORTGAGE PiJRCHASES.^The term "mortgage purchases" includes mortgages purchased for portfolio or
securitization.
(12) MULTIFAMILY HOUSING.—The term "multifamily housing" means a residence consisting of more than 4 dwelling
units.
(13) NEW PROGRAM.—^The term "new program" means any
program for the purchasing, servicing, selling, lending on the
security of, or otherwise dealing in, conventional mortgages
that—
(A) is significantly different from programs that have
been approved under this Act or that were approved or
engaged in by an enterprise before the date of the enactment of this Act; or
(B) represents an expansion, in terms of the dollar
voliune or number of mortgages or securities involved, of
programs above limits expressly contained in any prior
approval.
(14) OFFICE.—The term "Office" means the Office of Federal
Housing Enterprise Oversight of the Department of Housing
and Urban Development.
(15) SECRETARY.—The term "Secretary" means the Secretary of Housing and Urban Development.
(16) SINGLE FAMILY HOUSING.—The term "single family
housing" means a residence consisting of 1 to 4 dwelling units.

106 STAT. 3944

PUBLIC LAW 102-550—OCT. 28, 1992
(17) STATE.—The term "State" means the States of the
United States, the District of Columbia, the Commonwealth
of Puerto Rico, the Commonwealth of the Northern Mariana
Islands, Guam, the Virgin Islands, American Samoa, the Trust
Territory of the Pacific Islands, and any other territory or
possession of the United States.
(18) TOTAL CAPITAL.—The term "total capital" means, with
respect to an enterprise, the sum of the following:
(A) The core capital of the enterprise;
(B) A general allowance for foreclosure losses, which—
(i) shall include an allowance for portfolio mortgage
losses, an allowance for nonreimbursable foreclosure
costs on government claims, and an allowance for liabilities reflected on the balance sheet for the enterprise
for estimated foreclosure losses on mortgage-backed
securities; and
(ii) shall not include any reserves of the enterprise
made or held against specific assets.
(C) Any other amoimts from sources of funds available
to absorb losses incurred by the enterprise, that the Director by regulation determines are appropriate to include
in determining total capital.
(19) VERY

LOW-INCOME.—^The term

"very low-income"

means—
(A) in the case of owner-occupied units, income not
in excess of 60 percent of area median income; and
(B) in the case of rental imits, income not in excess
of 60 percent of area median income, with adjustments
for smaller and larger families, as determined by the
Secretary.
12 u s e 4503.

SEC. 1304. PROTECTION OF TAXPAYERS AGAINST LIABILITY.

This title and the amendments made by this title may not
be construed as obligating the Federal Government, either directly
or indirectly, to provide any funds to the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association,
or the Federal Home Loan Banks, or to honor, reimburse, or otherwise guarantee anv obligation or liability of the Federal Home
Loan Mortgage Corporation, the Federal National Mortgage
Association, or the Federal Home Loan Banks. This title and the
amendments made by this title may not be construed as implying
that any such enterprise or Bank, or any obligations or securities
of such an enterprise or Bank, are backed by the full faith and
credit of the United States.

Subtitle A—Supervision and Regulation of
Enterprises
PART 1—FINANCIAL SAFETY AND SOUNDNESS
REGULATOR
12 u s e 4511.

SEC. 1311. ESTABUSHMENT OF OFFICE OF FEDERAL HOUSING
ENTERPRISE OVERSIGHT.

There is hereby established an office within the Department
of Housing and Urban Development, which shall be known as
the Office of Federal Housing Enterprise Oversight.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3945

SEC. 1312. DIRECTOR.

12 USC 4512.

(a) APPOINTMENT.—^The Office shall be under the management President.
of a Director, who shall be appointed by the President, by and
with the advice and consent of tne Senate, from among individuals
who are citizens of the United States, have a demonstrated understanding of financial management or oversight, and have a demonstrated underst£uiding of mortgage seciirity markets and housing
finance. An individual may not be appointed as Director if the
individual has served as an executive officer or director of an
enterprise at any time during the 3-year period ending upon the
nomination of such individual for appointment as Director.
(b) TERM.—^The Director shall be appointed for a term of 5
years.
(c) VACANCY.—A vacancy in the pK)sition of Director shall be
filled in the manner in which the original appointment was made
under subsection (a).
(d) SERVICE AFTER END OF TERM.—^A Director may serve after
the expiration of the term for which the Director was appointed
imtil a successor Director has been appointed.
(e) DEPUTY DIRECTOR.—

\

(1) IN GENERAL.—The Office shall have a Deputy Director
who shall be appointed by the! Director from among individuals
who are citizens of the United States, have a demonstrated
understanding of financial management or oversight, and have
a demonstrated understanding of mortgage security markets
and housing finance. An individual may not be appointed as
Deputy Director if the individual has served as an executive
officer or director of an enterprise at any time during the
3-year period ending upon the appointment of such individual
as Deputy Director.
(2) FUNCTIONS.—^The Deputy Director shall have such functions, powers, and duties as the Director shall prescribe. In
the event of the death, resignation, sickness, or absence of
the Director, the Deputy Director shall serve as acting Director
until the return of the Director or the appointment of a successor pursuant to subsection (c).
SEC 1313. DUTY AND AUTHORITY OF DIRECTOR.

(a) DUTY.—^The duty of the Director shall be to ensure that
the enterprises are adequately capitalized and operating safely,
in accordance with this title.
(b) AUTHORITY EXCLUSIVE OF SECRETARY.—The Director is
authorized, without the review or approval of the Secretary, to
make such determinations, take such actions, and perform such
functions as the Director determines necessary regarding—
(1) the issuance of regulations to carry out this part, subtitle B, and subtitle C (including the establishment of capital
standards pursuant to subtitle B);
(2) examinations of the enterprises under section 1317;
(3) determining the capital levels of the enterprises and
classification of the enterprises within capital classifications
established under subtitle B;
(4) decisions to appoint conservators for the enterprises;
(5) administrative and enforcement actions under subtitle
B, actions taken under subtitle C with respect to enforcement
of subtitle B, and other matters relating to safety and
soundness;

12 USC 4513.

106 STAT. 3946

PUBLIC LAW 102-550—OCT. 28, 1992
(6) approval of payments of capital distributions by the
enterprises under section 303(cX2) of the Federal National
Mortgage Association Charter Act and section 303(bX2) of the
Federal Home Loan Mortgage Corporation Act;
(7) requiring the enterprises to submit reports under section 1314 of this title, section 309(k) of the Federal National
Mortgage Association Charter Act, and section 307(c) of the
Federal Home Loan Mortgage Corporation Act;
(8) prohibiting the payment of excessive compensation by
the enterprises to any executive officer of the enterprises under
section 1318;
(9) the management of the Office, including the establishment and implementation of annual budgets, the hiring of,
and compensation levels for, personnel of the Office, and annual
assessments for the costs of the Office;
(10) conducting research andfinancialanalysis; and
(11) the submission of reports required by the Director
under this title.
(c) AUTHORITY SUBJECT TO APPROVAL OF SECRETARY.—Any

determinations, actions, and fimctions of the Director not referred
to in subsection (b) shall be subject to the review and approval
of the Secretary.
(d) DELEGATION OF AUTHORITY.—The Director may delegate
to officers and employees of the Office any of the fimctions, powers,
and duties of the Director, as the Director considers appropriate.
(e) INDEPENDENCE IN PROVIDING INFORMATION TO CONGRESS.—

The Director shall not be required to obtain the prior approval,
comment, or review of any ofiicer or agency of the Unitea States
before submitting to the Congress, or any committee or subcommittee thereof, any reports, recommendations, testimony, or comments
if such submissions include a statement indicating that the views
expressed therein are those of the Director and do not necessarily
represent the views of the Secretary or the President.
12 u s e 4514.

SEC. 1314. AUTHORnY TO REQUIRE REPORTS BY ENTERPRISES.
(a) SPECIAL REPORTS AND REPORTS OF FINANCIAL CONDITION.—
(1) FINANCIAL CONDITION.—The Director may require an

enterprise to submit reports of financial condition and operations (in addition to the annual and quarterly reports required
under section 309(k) of the Federal National Mortgage Association Charter Act and section 307(c) of the Federal Home Loan
Mortgage Corporation Act).
(2) SPECIAL REPORTS.—^The Director may also require an
enterprise to submit special reports whenever, in the judgment
of the Director, such reports are necessary to carry out the
purposes of this title.
(3) LIMITATION.—^The Director may not require the inclusion, in any report pursuant to paragraph (1) or (2), of any
information that is not reasonably obtainable by the enterprise.
(4) NOTICE AND DECLARATION.—The Director shall notify
the enterprise, a reasonable period in advance of the date
for submission of any report under this subsection, of any
specific information to be contained in the report and the date
for the submission of the report. Each report under this subsection shall contain a declaration by the president, vice president, treasurer, or any other officer designated by the board
of directors of the enterprise to make such declaration, that

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3947

the report is true and correct to the best of such officer's
knowledge and belief.
(b) CAPITAL DISTRIBUTIONS.—The Director may require an
enterprise to submit a report to the Director after the declaration
of any capital distribution by the enterprise and before making
the capital distribution. The report shall be made in such form
and under such circumstances and shall contain such information
as the Director shall require.
SEC. 1316. PERSONNEL.
(a) OFFICE PERSONNEL.—^The

12 USC 4515.

Director may appoint and fix
the compensation of such officers and employees of the Office as
the Director considers necessary to carry out the functions of the
Director and the Office. Officers and employees may be paid without
regard to the provisions of chapter 51 and subchapter III of chapter
53 of title 5, United States Code, relating to classification and
General Schedule pay rates.
(b) COMPARABILITY OF COMPENSATION WITH FEDERAL BANKING

AGENCIES.—In fixing and directing compensation under subsection
(a), the Director shall consult with, and maintain comparability
with compensation of officers and employees of the Office of the
Comptroller of the Currenc}', the Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance Corporation, and
the Office of Thrift Supervision.
(c) PERSONNEL OF OTHER FEDERAL AGENCIES.—In carrying out
the duties of the Office, the Director may use information, services,
staff, and facilities of anv executive agency, independent agency,
or department on a reimbursable basis, with the consent of such
agency or department.
(d) REIMBURSEMENT OF HUD.—The Director shall reimburse
the Department of Housing and Urban Development for reasonable
costs incurred by the Department that are directly related to the
operations of the Office.
(e) OUTSIDE EXPERTS AND CONSULTANTS.—Notwithstanding any

provision of law limiting pay or compensation, the Director may
appoint and compensate such outside experts and consultants as
the Director determines necessary to assist the work of the Office.
(f) EQUAL OPPORTUNITY REPORT.—^Not later than the expiration
of the 180-day period beginning upon the appointment of the Director under section 1312, the Director shall submit to the Committee
on Banking, Finance and Urban Affairs of the House of Representatives and me Committee on Banking, Housing, and Urban Affairs
of the Senate a report containing—
(1) a complete description of the equal opportunity, affirmative action, and minority business enterprise utilization programs of the Office; and
(2) such recommendations for administrative and legislative
action as the Director determines appropriate to carry out
such programs.
SEC. 1316. FUNDING.
(a) ANNUAL ASSESSMENTS.—The

Director may, to the extent
provided in appropriation Acts, establish and collect from the enterprises annual assessments in an amount not exceeding the amount
sufficient to provide for reasonable costs and expenses of the Office,
including Uie expenses of any examinations under section 1317.
The initial annual assessment shall include any startup costs of

12 USC 4516.

106 STAT. 3948

PUBLIC LAW 102-550—OCT. 28, 1992

the Office and any anticipated costs and expenses of the Office
for the following fiscal year.
(b) ALLOCATION OF ANNUAL ASSESSMENT TO ENTERPRISES.—
(1) AMOUNT OF PAYMENT.—Each enterprise shall pay to

the Director a proportion of the annual assessment made pursuant to subsection (a) that bears the same ratio to the total
annual assessment that the total assets of each enterprise
bears to the total assets of both enterprises.
(2) TIMING OF PAYMENT.—The annual assessment shall be
payable semiannually on September 1 and March 1 of the
year for which the assessment is made.
(3) DEFINITION.—For the purpose of this section, the term
"total assets" means, with respect to an enterprise, the sum
of—
(A) on-balance-sheet assets of the enterprise, as determined in accordance with generally accepted accounting
principles;
(B) the unpaid principal balance of outstanding mortgage-backed securities issued or guaranteed by the enterprise that £ire not included in subparagraph (A); and
(C) other off-balance-sheet obligations as determined
by the Director.
(c) DEFICIENCIES DUE TO INCREASED COSTS OF REGULATION.—

The semiannual pajonents made pursuant to subsection (b) by
any enterprise that is not classified (for purposes of subtitle B)
as adequately capitalized may be increased, as necessary, in the
discretion of the Director to pay additional estimated costs of regulation of the enterprise.
(d) SURPLUS.—If any amoimt from any annual assessment collected fi*om an enterprise remains unobligated at the end of the
vear for which the assessment was collected, such amount shall
be credited to the assessment to be collected firom the enterprise
for the following year.
(e) INITIAL SPECIAL ASSESSMENT.—Not later than the expiration
of the 30-day period beginning on the date of the enactment of
this Act, the enterprises shall each pay into the Federal Housing
Enterprises Oversight Fimd established under subsection (f) an
initial assessment of $1,500,000 to cover the startup costs of the
Office, including space and modifications thereof, capital equipment,
suppUes, recruitment, and activities of the Office during the period
preceding the first annual assessment under subsection (a). Any
amounts collected firom an enterprise under this subsection shall
be credited against the first annual assessment collected pursuant
to subsection (a), and are hereby appropriated, and shall oe available and used, without fiscal year limitation, as provided in this
section.
(f) FUND.—^There is established in the Treasury of the United
States a fund to be known as the Federal Housing Enterprises
Oversight Fund. Any assessments collected pursuant to this section
shall he deposited in the Fund. Amounts in the Fund shall be
available, to the extent provided in appropriation Acts and subsection (e), for—
(1) carrying out the responsibiUties of the Director relating
to the enterprises; and
(2) necessary administrative and nonadministrative
expenses of the Office to carry out the purposes of this title.
(g) BUDGET AND FINANCIAL REPORTS.—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3949

(1) FINANCIAL OPERATING PLANS AND FORECASTS.—Before

the beginning of each fiscal year, the Director shall submit
a copy of the financial operating plans and forecasts for the
Office to the Secretary and the Director of the Office of Management and Budget.
(2) REPORTS OF OPERATIONS.—As soon as practicable after
the end of each fiscal year and each quarter thereof, the Director shall submit a copy of the report of the results of the
operations of the Office during such period to the Secretary
and the Director of the Office of Management and Budget.
(3) INCLUSION IN PRESIDENT'S BUDOET.^The annual plans,
forecasts, and reports required imder this subsection shall be
included (A) in the Budget of the United States in the appropriate form, and (B) in the congressional justifications of the
Department of Hoiising and Urban Development for each fiscal
year in a form determined by the Secretary.
SEC. 1317. E3CAMINATIONS.
(a) ANNUAL EXAMINATION.—The Director shall

12 USC 4517.

SEC. 1318. PROHIBITION OF EXCESSIVE COMPENSATION.

12 USC 4518.

anniially conduct
an on-site examination under this section of each enterprise to
determine the condition of the enterprise for the purpose of ensuring
itsfinancialsafety and soimdness.
(b) OTHER EXAMINATIONS.—In addition to annual examinations
under subsection (a), the Director may conduct an examination
under this section whenever the Director determines that an examination is necessary to determine the condition of an enterprise
for the purpose of ensuring its financial safety and soundness.
(c) EXAMINERS.—^The Director shall appoint examiners to conduct examinations under this section. The Director may contract Contracts.
with the Comptroller of the Currency, the Board of Grovemors
of the Federal Reserve System, the Federal Deposit Insurance Corporation, or the Director of the Office of Thrift Supervision for
the services of examiners. The Director shall reimburse such agencies for any costs of provi<iing examiners from amounts available
in the Federal Hoiising Enterprises Oversight Fund.
(d) LAW APPUCABLE TO EXAMINERS.—The Director and each
examiner shall have the same authority and each examiner shall
be subject to the same disclosures, prohibitions, obligations, and
penalties as are applicable to examiners employed by the Federal
Reserve banks.
(e) TECHNICAL EXPERT;;.—^The Director may obtain the services
of any technical experts the Director considers appropriate to provide temporary technical assistance relating to examinations to
the Director, officers, and employees of the Office. The Director
shall describe, in the record oi each examination, the nature and
extent of any such temporary technical assistance.
(f) OATHS, EVIDENCE, AND SUBPOENA POWERS.—In connection
with examinations under this section, the Director shall have the
authority provided under sciction 1379B.
(a) IN GENERAL.—The Director shall i>rohibit the enterprises
fi:t)m providing compensation to any executive officer of the enterprise tJiat is not reasonable and comparable with compensation
for employment in other similar businesses (including other publicly
held fmancial institutions or mcgor financial services companies)
involving similar duties and responsibiUties.

106 STAT. 3950

12 use 4519.

PUBLIC LAW 102-550—OCT. 28, 1992

(b) PROHmmoN OF SETTING COMPENSATION.—In carrying out
subsection (a), the Director may not prescribe or set a specific
level or range of compensation.
SEC. 1319. AUTHORTIY TO PROVIDE FOR REVIEW OF ENTERPRISES
BY RATING ORGANIZATION.
The Director may, on such terms and conditions as the Director
deems appropriate, contract with any entity effectively recognized
byr the Division of Market Regulation of the Securities and Exdiange
Commission as a nationally recognized statistical rating organization for tJie purposes of the capital rules for broker-dealers, to
conduct a review of the enterprises.

Minorities.

SEC. 1319A. EQUAL OPPORTUNITY IN SOUCITATION OF CONTRACTS.

I2°usc 4520

(*^ ^^ GENERAL.—Each enterprise shall establish a minority
outreach program to ensure the inclusion (to the maximum extent
possible) m contracts entered into by the enterprises of minorities
and women and businesses owned by minorities and women, including financial institutions, investment banking firms, underwriters,
accountants, brokers, and providers of le^al services.
(b) REPORT.—^Not later than the expiration of the 180-day period
beginning on the date of the enactment of this Act, each enterprise
shall submit to the Committee on Banking, Finance and lJrb£ui
Affairs of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate a report describing the actions taken by the enterprise pursuant to subsection
(a).

12 u s e 4521.

SEC. 1319B. ANNUAL REPORTS BY DIRECTOR.
(a) GENERAL REPORT.—The Director shall submit to the

Committee on Banking, Finance and Urban Affairs of the House
of Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate, not later than June 15 of each year,
a written report, which shall include—
(1) a description of the actions taken, and being undertaken, by the Director to carry out this title;
(2) a description of the financial safety and soundness
of each enterprise, including the results and conclusions of
the annual examinations of the enterprises conducted under
section 1317(a); and
(3) any recommendations for legislation to enhance the
financial safety and soundness of the enterprises.
(b) REPORT ON ENFORCEMENT ACTIONS.—Not later than March
15 of each year, the Director shall submit to the Committee on
Banking, Finance and Urbcui Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs
of the Senate a written report describing, for the preceding calendar
year, the requests by the Director to the Attorney General for
enforcement actions under subtitle C and describing the disposition
of each request, which shall include statements of—
(1) the total niunber of requests made by the Director;
(2) the number of requests that resulted in the commencement of Utigation by the Department of Justice;
(3) the number of requests that did not result in the
commencement of litigation by the Department of Justice;
(4) with respect to requests that resulted in the commencement of Utigation—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3951

(A) the number of days between the date of the request
and the commencement of the Utigation; and
(B) the number of days between the date of the
commencement and termination of the Utigation; and
(5) the nimiber of litigation requests pencdng at the beginning of the calendar year, the number of requeste made during
the calendar year, the number of requests for which action
was completed during the calendar year, and the number of
requests pending at the end of the c£dendar year.
SEC. 1319C. PUBUC DISCLOSURE OF FINAL ORDERS AND AGREE- 12 USC 4522.
MENTS.

(a) IN GENERAL.—^The Director shall make available to the
public—
(1) any written agi'eement or other written statement for
which a violation may be redressed by the Director or any
modification to or termination thereof unless the Director,
in the Director's discretion, determines that public disclosure
would be contrary to the public interest or determines imder
subsection (c) that public disclosure would seriously threaten
the financial health or seciuity of the enterprise;
(2) any order that is issued with respect to any administrative enforcement proceeding initiated by the Director under
subtitle C and that has become final; and
(3) any modification to or termination of any final order
made public pursuant to this subsection.
(b) HEARINGS.—^All hearings on the record with respect to any
action of the Director or notice of charges issued by the Director
shall be open to the public, imless the Director, in the Director's
discretion, determines that holding an open hearing would be contrary to the public interest.
(c) DELAY OF PUBLIC DISCLOSURE UNDER EXCEPTIONAL CIR-

CUMSTANCES.—If the Director makes a determination in writing
that the public disclosure of any final order pursuant to subsection
(a) woula seriously threaten the financial health or security of
the enterprise, the Director may delay the public disclosure of
such order for a reasonable time.
(d) DOCUMENTS FILED UNDER SEAL IN PUBLIC ENFORCEMENT

HEARINGS.—^The Director may file any document or part thereof
under seal in any hearing imder subtitle C if the Director determines in writing that disclosure thereof would be contrary to the
public interest.
(e) RETENTION OF DOCUMENTS.—The Director shall keep and Records.
maintain a record, for not less than 6 years, of all documents
described in subsection (a) and all enforcement agreements and
other supervisory actions and supporting documents issued with
respect to or in connection with any enforcement proceeding initiated by the Director under subtitle C.
(0 DISCLOSURES TO CONGRESS.—This section may not be construed to authorize the withholding of any information from, or
to prohibit the disclosure of any information to, the Congress or
any committee or subcommittee thereof.
SEC. 1319D. LIMITATION ON SUBSEQUENT EMPLOYMENT.

Neither the Director nor any former officer or employee of
the Office who, while employed by thie Office, was compensated
at a rate in excess of the lowest rate for a position classified
higher than GS-15 of the General Schedule under section 5107

12 USC 4523.

106 STAT. 3952

PUBLIC LAW 102-550—OCT. 28, 1992

of title 5, United States Code, may accept compensation from an
enterprise during the 2-year period beginning on the date of separation from emplojnnent by the Office.
12 u s e 4524.

SEC. 1319E. AUDITS BY GAO.

The Comptroller General shall audit the operations of the Office
in accordance with generally accepted Government auditing standards. All books, records, accounts, reports, files, and property
belonging to, or used by, the Office shall be made available to
the Comptroller General. Audits under this section shall be conducted annually for the first 2 fiscal years following the date of
the enactment of this Act and as appropriate thereafter.
12 u s e 4525.

SEC. 1S19F. INFORMATION, RECORDS, AND MEETINGS.

For purposes of subchapter II of chapter 5 of title 5, United
Stetes Code—
(1) the Office, and
(2) the Department of Housing and Urban Development,
with respect to activities under this title,
shall be considered agencies responsible for the regulation or supervision of financial institutions.
12 u s e 4526.

SEC. 1319G. REGULATIONS AND ORDERS.

(a) AUTHORITY.—^The Director shall issue any regulations and
orders necessary to carry out the duties of the Director and to
carry out this title before the expiration of the 18-month period
beginning on the appointment of the Director under section 1312.
Such regulations and orders shall be subject to the approved of
the Secretary only to the extent provided in subsections (b) and
(c) of section 1313.
(b) NOTICE AND COMMENT.—^Any regulations issued by the
Director under this section shall be issued after notice and opportunity for public comment pursuant to the provisions of section
553 of title 5, United Stetes Code.
(c) CONGRESSIONAL REVIEW.—The Director may not publish
any regulation for comment under subsection (b) unless, not less
than 15 days before it is published for comment, the Director
has submitted a copy of the regulation, in the form it is intended
to be proposed, to the Committee on Banking, Finance and Urban
Affairs of the House of Representetives and the Committee on
Banking, Housing, and Urban Affairs of the Senate.

PART 2—AUTHORITY OF SECRETARY
Subpart A—General Authority
12 u s e 4541.

SEC. 1321. REGULATORY AUTHORITY.

Except for the authority of the Director of the Office of Federal
Housing Enterprise Oversight described in section 1313(b) and all
other matters relating to the safety and soundness of the enterprises, the Secretory of Housing and Urban Development shall
nave general regulatory power over each enterprise ana shall make
such rules and regulations as shall be necessary and proper to
ensure that this part and the purposes of the Federal National
Mortgage Association Charter Act and the Federal Home Loan
Mortgage Corporation Act are accomplished.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3953

SEC. 1322. PRIOR APPROVAL AUTHORITY FOR NEW PROGRAMS.

(a) AUTHORITY.—^The Secretary shall require each enterprise
to obtain the approval of the Secretary for any new program of
the enterprise berore implementing the program.
(b) STANDARD FOR APPROVAL.—
(1) PERMANENT STANDARD.—Except

as provided in paragraph (2), the Secretartr shall approve any new program of
an enterprise for purposciS of subsection (a) unless—
(A) for a new program of the Federal National Mortgage Association, tne Secretary determines that the program is not authorized under paragraph (2), (3), (4), or
(5) of section 302(b) of the Federal National Mortgage
Association Charter Act, or under section 304 of such Act;
(B) for a new program of the Federal Home Loan
Mortgage Corporation, the Secretary determines that the
program is not authorized imder section 305(a) (1), (4),
or (5) of the Federal Home Loan Mortgage Corporation
Act; or
(C) the Secretary determines that the new program
is not in the public interest.
(2) TRANSITION STANDARD.—Before the date occurring 12
months after the date of the effectiveness of the r e l a t i o n s
under section 1361(e) establishing the risk-based capital test,
the Secretary shall approve any new program of an enterprise
for purposes of subsection (a) unless—
(A) The Secretary makes a determination as described
in paragraph (1) (A), (B), or (C); or
(B) the Director determines that the new program
would risk significant deterioration of the financial condition of the enterprise.
(c) PROCEDURE FOR APPROVAL.—
(1) SUBMISSION OF REQUEST.—TO

obtain the approval of
the Secretary for purposes of subsection (a), an enterprise shall
submit to the Secretary a written request for approval of the
new program that describes the program.
(2) RESPONSE.—The Secretary shall, not later than the
expiration of the 45-day period beginning upon the submission
of a request for approval, approve the request or submit to
the Committee on Bankiing, Finance and Urban Affairs of the
House of Representatives and the Committee on B£uiking, Housing, and Urban AfTairs of the Senate a report explaining tiie
reasons for not approving the request. The Secretary may
extend such period for a single additional 15-day period only
if the Secretary requests additional information fi:om the
enterprise.
(3) FAILURE TO RESPOND,—If the Secretary fails to approve
the request or fails to submit a report under paragraph (2)
during the period under such paragraph, the request shall
be considered to have been approved.
(4) REVIEW OF DISAPPROVAL.—
(A) UNAUTHORIZED NEW PROGRAMS.—If

the Secretary
submits a report under paragraph (2) of this subsection
disapproving a request for approval on the grounds under
subparagraph (A) or (B) of subsection (bXD, the Secretarv
shall proviae the enterprise submitting the request with
a timely opportimity to review and supplement the
administrative record.

12 USC 4542.

106 STAT. 3954

PUBLIC LAW 102-550—OCT. 28, 1992
(B) NEW PROGRAMS NOT IN PUBUC INTEREST.—If the

Secretary submits a report under paragraph (2) of this
subsection disapproving a request for approval on the
grounds under subsection (bXlXC) or (bX2XB), the Secretary shall provide the enterprise submitting the request
notice of, and opportimitv for, a hearing on the record
regarding such disapproval.
12 u s e 4543.

SEC. 1323. PUBUC ACCESS TO MORTGAGE INFORMATION.

(a) I N GENERAL.—^The Secretaiy shall make available to the
ublic, in forms useful to the public (including forms accessible
y computers), the data submitted bv the enterprises in the reports
required under section 309(m) of the Federal National Mortgage
Association Charter Act or section 307(e) of the Federal Home
Loan Mortgage Corporation Act.

E

(b) ACCESS.—
(1) PROPRIETARY DATA.—Except as provided in paragraph

(2), the Secretary may not make availaole to the public data
that the Secretary determines pursuant to section 1326 are
proprietary information.
(2) EXCEPTION.—^The Secretary shall not restrict access
to the data provided in accordance with section 309(mXlXA)
of the Federal National Mortgage Association Charter Act or
section 307(eXlXA) of the Federal Home Loan Mortgage Corporation Act.
(c) FEES.—^The Secretary may charge reasonable fees to cover
the cost of making data available under this section to the public.
12 u s e 4544.

SEC. 1324. ANNUAL HOUSING REPORT.

(a) IN GENERAL.—^After reviewing and analyzing the reports
submitted under section 309(n) of the Federal National Mortgage
Association Charter Act and section 307(f) of the Federal Home
Loan Morteage Corporation Act, the Secretary shall submit a report,
as part of the annual report under section 1328(a) of this title,
on the extent to which each enterprise is achieving the annual
housing goals established under subpart B of this part and the
purposes of the enterprise established by law.
(b) CONTENTS.—The report shall—
(1) aggregate and analyze census tract data to assess the
compliance of each enterprise with the central cities, rural
areas, and other underserved areas housing goal and to determine levels of business in central cities, rural areas, underserved areas, low- and moderate-income census tracts, minority
census tracts, and other geographical areas deemed appropriate
by the Secretary;
(2) aggregate and analyze data on income to assess the
compliance of each enterprise with the low- and moderateincome and special affordable housing goals;
(3) aggregate and analyze data on income, race, and gender
by census tract and compare such data with larger demographic, housing, and economic trends;
(4) examine actions that each enterprise has undertaken
or could imdertake to promote and expand^ |Ji(g,4Stnnual goals
established under sections 1332, 1333, and 1334, and the purposes of the enterprise established by law;
(5) examine the primary and secondary multifamily housing
mortgage markets and describe^
(A) the availability and liquidity of mortgage credit;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3955

(B) the status of efiforts to provide standard credit
terms and underwriting guidelines for multifamily hoiising
and to securitize such mortgage products; and
(C) any factors inhibiting such standardization and
securitization;
(6) examine actions each enterprise has undertaken and
could undertake to promote and expand opportunities for firsttime homebuyers; and
(7) describe any actions taken under section 1325(5) with
respect to originators found to violate fair lending procedures.
SEC. 1325. FAIR HOUSING.
_, _
,
,1,

12 USC 4545.
Regulations.

The Secretary shall—
(1) by regulation, piohibit each enterprise from discriminating in any manner in the purchase of any mortg£Lge because
of race, color, religion, sex, handicap, familial status, age, or
national origin, including any consideration of the age or location of the dwelling or the age of the neighborhood or census
tract where the dwelling is located in a manner that has
a discriminatory effect;
(2) by regulation, require each enterprise to submit data
to the Secretary to assist the Secretary in investigating whether
a mortgage lender with which the enterprise does business
has failed to comply with the Fair Housing Act;
(3) by regulation, require each enterprise to submit data
to the Secretary to assist in investigating whether a mortgage
lender with which the enterprise does business has failed to
comply with the Equal Oedit Opportunity Act, and shall submit
any such information rcK^ived to the appropriate Federal agencies, as provided in section 704 of the Equal Credit Opportimity
Act, for appropriate action;
(4) obtain information from other regulatory and enforcement agencies of the Federal Government and State and local
governments regarding violations by lenders of the Fair Housmg Act and the Equsu Credit Opportunity Act and make such
information available to the enterprises;
(5) direct the enterprises to undertake various remedial
actions, including suspension, probation, reprimand, or settlement, against lenders that have been found to have engaged
in discriminatory lending practices in violation of the Fair
Housing Act or the Equal Credit Opportunity Act, pursuant
to a final adjudication on the record, and after opportunity
for an administrative hearing, in accordance with subchapter
n of chapter 5 of title 5, United States Code; and
(6) periodicallv review and comment on the underwriting
and appraisal guidelines of each enterprise to ensure that such
guidelines are consistent with the Fair Housing Act and this
section.
SEC. 1328. PROHmrnON OF PUBUC DISCLOSURE OF PROPRIETARY
INFORMATION.

(a) IN GENERAL.—^The Secretarv may, by regulation or order,
provide that certain information shall be treated as proprietary
information and not subject to disclosure imder section 1323 of
tills title, section 309(nX3) of the Federal National Mortgage
Association Charter Act, or section 307(fX3) of the Federal Home
Loan Mortgage Corporation Act.

12 USC 4546.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3956

(b) PROTECTION OF INFORMATION ON HOUSING AcnvmES.—
The Secretary shall not provide public access to, or disclose to
the public, any information required to be submitted by an enterprise under section 309(n) of the Federal National Mortgage
Association Charter Act or section 307(0 of the Federal Home
Loan Mortgage Corporation Act that the Secretary determines is
proprietary.

(c)

NONDISCLOSURE PENDING CONSIDERATION.—This

section

may not be construed to authorize the disclosure of information
to, or examination of data by, the public or a representative of
any person or agency pending the issuance of a final decision
under this section.
12 u s e 4548.

SEC. 1327. AUTHORITY TO REQUIRE REPORTS BY ENTERPRISES.

The Secretary shall require each enterprise to submit reports
on its activities to the Secretary as the Secretary considers
appropriate.
12 u s e 4548.

SEC. 1328. REPORTS BY SECRETARY.
(a) ANNUAL REPORT.—^The Secretarv

shall, not later than June
30 of each vear, submit a report to tne Committee on Banking,
Finance and Urban Affairs of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of the
Senate on the activities of each enterprise.
(b) VIEWS ON BUDGET AND FINANCIAL PLANS OF ENTERPRISES.—

On an annual basis, the Secretary shall provide the Committees
referred to in subsection (a) with comments on the plans, forecasts,
and reports required imder section 1316(g).

Subpart B—^Housing Goals
12 u s e 4561.

SEC. 1331. ESTABUSHMENT.

Regulations.

(a) IN GENERAL.—The Secretary shall establish, by regulation,
housing goals under this subpart for each enterprise. The housing
goals sh£ul include a low- and moderate-income housing goal pursuant to section 1332, a special affordable housing goal pursuant
to section 1333, and a central cities, rural areas, and other underserved areas housing goal pursuant to section 1334. The Secretary
shall implement this subpart in a manner consistent with section
301(3) of the Federal National Mortgage Association Charter Act
and section 301(bX3) of the Federal Home Loan Mortgage Corporation Act.
(b) CONSIDERATION OF UNITS IN MULTIFAMILY HOUSING.—In

establishing an^ goal under this subpart, the Secretary may take
into consicferation the number of housing units financed by any
mortgage on multifamily housing purchased by an enteiprise.
(c) ADJUSTMENT OF HOUSING GOALS.—Except as otherwise provided in this title, from year to year the Secretary may, by regulation, adjust any housing goal established under this subpart.
12 u s e 4562.

SEC. 1332. LOW- AND MODERATE-INCOME HOUSING GOAL.

(a) IN GENERAL.—^The Secretary shall establish an annual goal
for the purchase by each enteiprise of mortgages on housing for
low- ana moderate-income families. The Secretary may establish
separate specific subgoals within the goal imder this section and
such subgoals shall not be enforceable under the provisions of
section 1336, any other provision of this title, or any provision

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3957

of the Federal National Mortgage Association Charter Act or the
Federal Home Loan Mortgage Corporation Act.
(b) FACTORS TO BE APPLIED.—In establishing the goal under
this section, the Secretary shall consider—
(1) national housing: needs;
(2) economic, housing, and demographic conditions;
(3) the performance and effort of the enterprises toward
achieving the low- and moderate-income housing goal in previous years;
(4) the size of the conventional mortgage market serving
low- and moderate-income families relative to the size of the
overall conventional mortgage market;
(5) the ability of the enterprises to lead the industry in
making mortgage credit available for low- and moderate-income
families; and
(6) the need to maintain the sound financial condition
of the enterprises.
(c) USE OF BORROWER AJW TENANT INCOME.—

(1) IN GENERAL.—^The Secretary shall monitor the performance of each enterprise; in carrying out this section and shall
evaluate such performance (for purposes of section 1336) based
on—
(A) in the case of an owner-occupied dwelling, the
mortgagor's income at the time of origination of the mortgage; or
(B) in the case of a rental dwelling—
(i) the income of the prospective or actual tenants
of the property, where such data are available; or
(ii) the rent levels affordable to low- and moderateincome families, where the data referred to in clause
(i) are not available.
(2) AFFORDABlLlTf.—^For the purpose of paragraph
(IXBXii), a rent level shall be considered affordable if it does
not exceed 30 percent of the maximiun income level of the
income categories referred to in tiiis section, with appropriate
a4justments for unit size as measured by the number of
bedrooms.
(d) TRANSITION.—
(1) INTERIM TARGEI\—^Notwithstanding

any other provision
of thds section, during the 2-year period l^ginning on January
1, 1993, the annual target imder this section for low- and
moderate-income mortgage purchases for each enterprise shall
be 30 percent of the total number of dwelling units financed
by mortgage purchases of the enterprise.
(2) INTERIM GOAL.—During such 2-vear period, the Secretary shall establish a separate anniuu goal for each enterprise, the achievement of which shall require—
(A) an enterprise that is not meeting the target under
paragraph (1) uiK)n January 1, 1993, to improve its
performance relative to such target annually and, to the
maximum extent feasible, to meet such target at the conclusion of such 2-year period; and
• •', (B) an enterprise that is meeting the target under
paragraph (1) upon January 1, 1993, to improve its
performance relative to the target.
(3) IMPLEMENTATION.—The Secretary shall estabUsh any
requirements necessary to implement Uie transition provisions

106 STAT. 3958

PUBLIC LAW 102-550—OCT. 28, 1992
under this subsection by notice, after providing the enterprises
with an opportunity to review and comment not less than
30 days before the issuance of such notice. Such notice shall
be issued not later than the expiration of the 90-day period
beginning upon the date of the enactment of this Act and
shall be effective upon issuance.

12 u s e 4563.

SEC. 1333. SPECIAL AFFORDABLE HOUSING GOAL.
(a) ESTABLISHMENT.—

(1) IN GENERAL.—^The Secretary shall establish a special
annual goal designed to adjust the purchase by each enterprise
of mortgages on rental and owner-occupied nousing to meet
the then-existing luiaddressed needs of, and affordable to, lowincome families in low-income areas and very low-income families. The special affordable housing goal established under this
section for an enterprise shall not be less than 1 percent of
the dollar amoimt of^the mortgage piu'chases by the enterprise
for the previous year.
(2) STANDARDS.—In establishing the special affordable
housing goal for an enterprise, the Secretai^ shall consider—
CA) data submitted to the Secretary m connection with
the special affordable housing goal for previous years;
(B) the performance and efforts of the enterprise
toward achieving the special affordable housing goal in
previous years;
(C) national housing needs within the categories set
forth in this section;
(D) the ability of the enterprise to lead the industry
in making mortgage credit available for low-income and
very low-income families; and
(E) the need to maintain the sound financial condition
of the enterprise.
(b) FULL CREDIT AcnvrriES.—
(1) IN GENERAL.—^The Secretary shall give full credit toward
achievement of the special affordable housing goal under this
section (for purposes of section 1336) to the following activities:

(A)

FEDERALLY RELATED MORTGAGES.—The

purchase

or securitization of federally insured or guaranteed mortgages, if—
(i) such mortgages cannot be readily securitized
through the Government National Mortgage Association or any other Federal agency;
(ii) participation of the enterprise substantially
enhances the affordability of the housing subject to
such mortgages; and
(iii) the mortgages involved are on housing that
otherwise qualifies imder such goal to be considered
for purposes of such goal.
(B) PORTFOLIOS.—^The piurchase or refinancing of existing, seasoned portfolios of loans, if—
(i) the seller is engaged in a specific program to
use the proceeds of such sales to originate additional
loans that meet such goal; and
(ii) such purchases or refinancings support additional lending for housing that otherwise qualifies
under such goal to be considered for purposes of such
goal.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3959

(C) RTC AND FDic LOANS.—The purchase of direct loans
made hy the Resolution Trust Corporation or the Federal
Deposit Insurance Corporation, if such loans—
(i) are not guaranteed by such agencies themselves
or other Federal agencies;
(ii) are made with recourse provisions similar to
those offered through private mortgage insurance or
other conventional sellers; and
(iii) are made for the purchase of housing that
otherwise qualifies under such goal to be considered
for purposes of such goal.
(2) EXCLUSION.—^No credit toward the achievement of the
special affordable housing goal may be given to the purchase
or securitization of mortgages associated with the refinancing
of the existing enterprise portfolios.
(c) USE OF BORROWER AND TENANT INCOME.—
(1) IN GENERAL.—^The Secretary shall monitor the performance of each enterprise in carrying out this section and shall
evaluate such performance (for purposes of section 1336) based
on—
(A) in the case of an owner-occupied dwelling, the
mortgagor's income at the time of origination of the mortgage; or
(B) in the c€ise of a rental dwelling—
(i) the income of the prospective or actual tenants
of the property, where such data are available; or
(ii) the rent levels affordable to low-income and
very low-income families, where the data referred to
in clause (i) are not available.
(2) AFFORDABILTTY.—^For the purpose of paragraph
(IXBXii), a rent level shall be considered affordable if it does
not exceed 30 percent of the maximum income level of the
income categories referred to in this section, with appropriate
adjustments for unit size as measured by the number of
bedrooms.
(d) TRANSITION.—

(1) FNMA M R G G PURCHASES.—Notwithstanding any
OTAE
other provision of this section, during the 2-year period beginning on January 1, 1993, the special affordable housing goal
for the Federal National Mortgage Association shall include
mortgage purchases of not less than $2,000,000,000 (for such
2-year period), with one-half of such purchases consisting of
mortgages on single family housing and one-half consisting
of mortgages on multifamily housing.
(2) FHLMC M R G G PURCHASES.—Notwithstanding any
OTAE
other provision of this section, during the 2-year period beginning on January 1, 1993, the special affordable nousing goal
for the Federal Home !Loan Mortgage Corporation shall include
mortgage purchases of not less than $1,500,000,000 (for such
2-year period), with one-half of such purchases consisting of
mortgages on single family housing and one-half consisting
of mortgages on multifamily housing.
(3) INCOME CHARACTERISTICS FOR MORTGAGE PURCHASES.—
(A) MULTIFAMILY MORTGAGES.—The special affordable

housing goals established under paragraphs (1) and (2)
shall provide that, of mortgages on multifamily housing

59-194 O—93

11 : QL 3 (Pt. 5)

106 STAT. 3960

PUBLIC LAW 102-550—OCT. 28, 1992
that are purchased and contribute to the achievement of
such goals—
(i) 45 percent shall be mortgages on multifamily
housing affordable to low-income families; and
(ii) 55 percent shall be mortgages on multifamily
housing in which—
(I) at least 20 percent of the units are affordable to families whose incomes do not exceed 50
percent of the median income for the area; or
(II) at least 40 percent of the units are affordable to very low-income families.
(B) SINGLE FAMILY MORTGAGES.—The special affordable
housing goals established imder paragraphs (1) and (2)
shall provide that, of mortgages on single fandly housing
that are purchased and contribute to the achievement of
such goals—
(i) 45 percent shall be mortgages of low-income
famiUes who live in census tracts in which the median
income does not exceed 80 percent of the area median
income; and
(ii) 55 percent shall be mortgages of very lowincome families.
(C) COMPLIANCE WITH SPECIAL AFFORDABLE HOUSING

GOALS.—Only the portion of mortgages on multifamily
housing purchased by an enterprise that are attributable
to units affordable to low-income families shall contribute
to the achievement of the special affordable housing goals
under subparagraph (AXii).
(4) IMPLEMENTATION.—The Secretary shall establish any
requirements necessary to implement the transition provisions
under this subsection by notice, after providing the enterprises
with an opportunity to review and comment not less than
30 days before the issuance of such notice. Such notice shall
be issued not later than the expiration of the 90-day period
beginning upon the date of the enactment of this Act and
shall be effective upon issuance.
12 u s e 4564.

SEC. 1334. CENTRAL CITIES, RURAL AREAS, AND OTHER UNDER*
SERVED AREAS HOUSING GOAL.

(a) IN GENERAL.—^The Secretary shall establish an annual goal
for the purchase by each enterprise of mortgages on housing located
in central cities, rural areas, and other underserved areas. The
Secretary may establish separate subgoals within the goal under
this section and such subgoals shall not be enforceable under the
provisions of section 1336, any other provision of this title, or
any provision of the Federal National Mortgage Association Charter
Act or the Federal Home Loan.Mortgage Corporation Act.
(b) FACTORS TO BE APPLIED.—In establishing the housing goal
under tiiis section, the Secretary shall consider—
(1) urban and rural housing needs and the housing needs
of underserved areas;
(2) economic, housing, and demographic conditions;
(3) the performance and efforts of the enterprises toward
achieving the central cities, rural areas, and other underserved
areas housing goal in previous years;

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3961

(4) the size of the conventional mortgage market for central
cities, rurcd areas, and other underserved areas relative to
the size of the overall conventional mortgage market;
(5) the abihty of the enterprises to lead the industry in
making mortgage credit available throughout the United States,
includmg central cities, rural areas, and other underserved
areas; and
(6) the need to maintain the sound financial condition
of the enterprises.
(c) LOCATION OF PROPERTIES.—The Secretary shall monitor the
performance of each enterprise in carrying out this section and
shall evaluate such performance (for purposes of section 1336) bcuied
on tiie location of the properties subject to mortgages purchased
by each enterprise.
(d) TRANSITION.—
(1) INTERIM TARGET.—^Notwithstanding any other provision

of tMs section, during the 2-year period beginning on January
1, 1993, the annual target under this section for purchases
by each enterprise of mortgages on housing located m central
cities shall be 30 percent of the total number of dwelling units
financed by mortgage purchases of the enterprise.
(2) INTERIM GOAL.—^During such 2-vear period, the Secretary shall esteblish a separate annual goal for each enterprise, the achievement of which shall require—
(A) an enterprise that is not meeting the target under
paragraph (1) upon January 1, 1993, to improve its
performance relative to such torget annually and, to the
maximum extent feasible, to meet such target at the conclusion of such 2-year period; and
(B) an enterprise that is meeting the target under
paragraph (1) upon January 1, 1993, to improve its
performance relative to the target.
(3) DEFINITION OF CENTRAL CITY.—For pui^rases of this
subsection, the term "central city" means any political subdivision designated as a central city by the Office of Management
and Budget.
(4) IMPLEMENTATION.—The Secretary shall esteblish any
requiremente necessaiy to implement the transition provisions
under this subsection by notice, afi«r providing the enterprises
with an opportunity to review and comment not less than
30 days before the issuance of such notice. Such notice shall
be issued not later than the expiration of the 90-day period
beginning upon the date of the enactment of this Act and
shall be effective upon issuance.
SEC. 1335. OTHER REQUIREMENTS.

To meet the low- and moderate-income housing goal under
section 1332, the special affordable housing goal under section
1333, and the central cities, rural areas, and other underserved
areas housing goal under section 1334, each enterprise shall—
(1) design programs and producte that fadlitete the use
of assist£uice provided by the Federal Government and Stete
and local govemmente;
(2) develop relationships with nonprofit and for-profit
organizations that develop and finance housing and with stete
and local govemmente, including housing finance agencies;
(3) take affirmative steps t o ^

12 USC 4565.

106 STAT. 3962

PUBLIC LAW 102-550—OCT. 28, 1992
(A) assist primary lenders to make housing credit available in areas with concentrations of low-income and minority families, and
(B) assist insured depository institutions to meet their
obligations under the Community Reinvestment Act of
1977,
which shall include developing appropriate and prudent underwriting standards, business practices, repurchase requirements,
pricing, fees, and procedures; and
(4) develop the institutional capacity to help finance lowand moderate-income housing, including housing for first-time
homebuyers.

12 u s e 4566.

SEC. 1336. MONITORING AND ENFORCING COMPLIANCE WITH HOUSING GOALS.
(a) IN GENERAL.—

(1) AUTHORITY.—^The Secretary shall monitor and enforce
compliance with the housing goals established under sections
1332,1333, and 1334, as provided in this section.
(2) GUIDELINES.—^The Secretary shall establish guidelines
to measure the extent of compliance with the housing goals,
which may assign full credit, partial credit, or no credit toward
achievement of the housing goals to different categories of
mortgage purchase activities of the enterprises, based on such
criteria as the Secretary deems appropriate.
(3) EXTENT OF COMPLIANCE.—In determining compliance
with the housing goals established under this subpart, the
Secretary—
(A) shall consider any single mortgage purchased by
an enterprise as contributing to the achievement of each
housing goal for which such mortgage purchase qualifies;
and
(B) may take into consideration the number of housing
units financed by any mortgage on housing purchased by
an enterprise.
(b) NOTICE AND DETERMINATION OF FAILURE TO MEET GOALS.—

(1) NOTICE.—If the Secretary determines that an enterprise
has failed, or that there is a substantial probability that an
enterprise will fsdl, to meet any housing goal establisned under
section 1332, 1333, or 1334, the Secretary shall provide written
notice to the enterprise of such a determination, the reasons
for such determination, the requirement to submit a housing
plan imder subsection (c) of this section, and the information
on which the Secretary based the determination or imposed
such requirement.
(2) RESPONSE PERIOD.—

(A) IN GENERAL.—^During the 30-day period beginning
on the date that an enterprise is provided notice under
paragraph (1), the enterprise may submit to the Secretary
any written information that the enterprise considers
appropriate for consideration by the Secretary in determining whether such failure has occurred or whether the
achievement of such goal was or is feasible.
(B) EXTENDED PERIOD.—^The Secretary may extend the
period under subparagraph (A) for good cause for not more
than 30 additional days.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3963

(C) SHORTENED PERIOD.—^The Secretary may shorten
the period under subparagraph (A) for good cause.
(D) FAILURE TO RESPOND.—^The failure of an enterprise
to provide information during the 30-day period under this
paragraph (as extended or shortened) shall waive an^ ri^ht
of the enterprise to comment on the proposed determination
or action of the Secretary.
(3) CONSIDERATION OF INFORMATION AND DETERMINATION.—

(A) I N GENERAI^.—^After the expiration of the response
period imder paragraph (2) or upon receipt of information
provided during such period by the enterprise, whichever
occurs earlier, the Secretary shall determine (i) whether
the enterprise has failed, or there is a substantial probability that the enterprise will fail, to meet the housing
goal, and (ii) whether (taking into consideration market
and economic conditions and the financial condition of the
enterprise) the achievement of the housing goal was or
is feasible.
(B) CONSIDERATIONS.—In making such determinations,
the Secretary shall take into consideration any relevant
information submitted by the enterprise during the
response period.
(C) NOTICE.—The Secretary shall provide written
notice to the enterprise, the Committee on Banking,
Finance and Urban Affairs of the House of Representatives,
and the Committee on Banking, Housing, and Urban
Affairs of the Senate, of—
(i) each determination that an enterprise has
failed, or that there is a substantial probability that
the enterprise will fail, to meet a housing goal;
(ii) each determination that the achievement of
a housing goal was or is feasible; and
(iii) the reasons for each such determination.
Such notice shall respond to any information submitted
during the respons<} period,
(c) HOUSING PLANS.—

(1) REQUIREMENT.—If the Secretary finds pursuant to subsection (b), that an enterprise has failed, or that there is a
substantial probability that an enterprise will fail, to meet
any housing goal established under section 1332, 1333, or 1334,
and that the achievement of the housing goal was or is feasible,
the Secretary shall require the enterprise to submit a housing
plan under this subsection for approval by the Secretary.
(2) CONTENTS.—Each housing plan shall be a feasible plan
describing the specific actions the enterprise will take—
(A) to achieve the goal for the next calendar year;
or
(B) if the Secretary determines that there is a substantial probability that the enterprise will fail to meet a goal
in the current year, to make such improvements as are
reasonable in the remainder of such year.
The plan shall be sufficiently specific to enable the Secretary
to monitor compliance i)eriodicalIy.
(3) DEADLINE FOR SUBMISSION.—The Secretary shall, by Regulations.
regulation, establish a deadline for an enterprise to submit
a housing plan to the Secretary, which may not be more than
45 days after the enterprise is provided notice under subsection

106 STAT. 3964

PUBLIC LAW 102-550—OCT. 28, 1992
(bX3) that a housing plan is required. The regulations shall
provide that the Secretary may extend the deadline to the
extent that the Secretary determines necessary. Any extension
of the deadline shall be in writing and for a time certain.
(4) APPROVAL.—^The Secretary shall review each housing
plan submitted under this subsection and, not later than 30
days after submission of the plan, approve or disapprove the
plan. The Secretary may extend the period for approval or
disapproval for a single additional 30-day period if the Secretary
determines it necessary. The Secretary shall approve any plan
that the Secretanr determines is likely to succeed, and conforms
with the Federal National Mortgage Association Charter Act
or the Federal Home Loan Mortage Corporation Act (as
applicable), this title, and any other applicable laws and regulations.
(5) NOTICE OF APPROVAL AND DISAPPROVAL.—The Secretary
shall provide written notice to any enterprise submitting a
housing plan of the approval or disapproval of the plan (which
shall include the reasons for any disapproval of the plan) and
of any extension of the period for approval or disapproval.
(6) RESUBMISSION.—If the initial housing plan suomitted
by an enterprise is disapproved, the enterprise shall submit
an amended plan acceptable to the Secretary within 30 days
or such longer period that the Secretary determines is in tne
public interest.

12 u s e 4567.

SEC. 1337. REPORTS DURING TRANSITION.

Each enterprise shall submit to the Secretary, the Committee
on Banking, Finance and Urban Affairs of the House of Representatives, and the Committee on Banking, Housing, and Urban Affairs
of the Senate, a report for each transitional housing goal for the
enterprise imder section 1332(d), 1333(d), or 1334(d), describing
the actions the enterprise plans to take to meet such goal. Each
such report shall be submitted within 45 days after the establishment of the goal for which the report is submitted.
12 u s e 4562

SEC. 1338. EFFECTIVE DATE OF TRANSITION GOALS.

"°^

The housing goals established under sections 1332(d), 1333(d),
and 1334(d) shall not become effective until January 1,1993.

Subpart C—^Enforcement of Housing Goals
12 u s e 4581.

SEC. 1341. CEASE-AND-DESIST PROCEEDINGS.
(a) GROUNDS FOR ISSUANCE.—The Secretary

may issue and
serve a notice of charges under this section upon an enterprise
if, in the determination of the Secretary—
(1) the enterprise has failed to submit a housing plan
that substantially complies with section 1336(c) within the
applicable period;
(2) the enterprise is engaging or has engaged, or the Secretary has reasonable cause to believe that the enteiprise is
about to engage, in an^ failure to make a good faith effort
to comply with a housing plan for the enterprise submitted
and approved tuider section 1336(c); or
(3) the enterprise has failed to submit the information
required under subsection (m) or (n) of section 309 of the
Federal National Mortgage Association Charter Act, subsection

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3965
• \
(e) or (f) of section 307 of the Federal Home Loan Mortgage
Corporation Act, or section 1337 of this title.
(b) PROCEDURE.—
(1) NOTICE OF CHARGES.—^Each notice of charges shall con-

tain a statement of the facts constituting the alleged conduct
and shall fix a time and place at which a hearing will be
held to determine on the record whether an order to cease
and desist from such conduct should issue.
(2) ISSUANCE OF ORDER.—If the Secretary finds on the
record made at such hearing that any conduct specified in
the notice of charges has been established (or the enterprise
consents pursuant to section 1342(aX4)), the Secretary may
issue and serve upon the enterprise an order requiring the
enterprise to (A) submit a housing plan in compliance with
section 1336(c), (B) comply with the housing plan, or (C) provide
the information required imder subsection (m) or (n) of section
309 of the Federal National Mortgage Association Charter Act,
subsection (e) or (f) of section 307 of the Federal Home Loan
Mortgage Corporation Act, or section 1337 of this title.
(c) EFFECTIVE DATE.—^An order imder this section shall become
effective upon the expiration of the 30-day period beginning on
the service of the order upon the enterprise (except in the case
of a n order issued upon consent, which shall become effective a t
the time specified therein), and shall remain effective and enforceable as provided in the order, except to the extent that the order
is stayed, modified, terminated, or set aside by action of the Secretary or otherwise, as provided in this subpart.
(d) TRANSITION PERIOD LIMITATION.—The Secretary may not

impose any cease-and-desist order imder this section for any failure
by an enterprise, during the 2-year period beginning on the January
1, 1993, to comply with an approved housing plan, imless the
Secretary determines that the enterprise has mtentionally failed
to make a good faith effort to comply with the approved plan.
SEC. 1342. HEARINGS.
(a) REQUIREMENTS.—
(1) VENUE AND RECORD.—Any hearing under section 1341

or 1345 shall be held on the record and in the District of
Columbia.
(2) TIMING.—^Any such hearing shall be fixed for a date
not earlier than 30 days nor later than 60 days after service
of the notice of charges imder section 1341(bXl) or determination to impose a penalty under section 1345(cXl), unless an
earlier or a later date is set by the hearing officer a t the
request of the enterprise served.
(3) PROCEDURE.—Any such hearing shall be conducted in
accordance with chapter 5 of title 5, United States Code.
(4) FAILURE TO APPEAR.—If the enterprise served fails to
appear at the hearing through a duly authorized representative,
such enterprise shall be deemed to have consented to the issuance of the cease-and-desist order or the imposition of the
penalty for which the hearing is held.
(b) ISSUANCE OF ORDER.—

(1) IN GENERAL.—^After any such hearing, and within 90
days after the enterprise has been notified that the case has
been submitted to the Secretary for final decision, the Secretary
shall render the decision (which shall include findings of fact

12 USC 4582.

106 STAT. 3966

PUBLIC LAW 102-550—OCT. 28, 1992
upon which the decision is predicated) and shall issue and
serve upon the enterprise an order or orders consistent with
the provisions of this subpart.
(2) MODIFICATION.—Judicial review of any such order shall
be exclusively as provided in section 1343. Unless such a petition for review is timely filed as provided in section 1343,
and thereafter until the record in the proceeding has been
filed as so provided, the Secretary may at any time, modify,
terminate, or set aside any such order, upon such notice and
in such manner as the Secretary considers proper. Upon such
filing of the record, the Secretary may modify, terminate, or
set aside any such order with permission of the court.

12 u s e 4583.

SEC. 1343. JUDICIAL REVIEW.

(a) COMMENCEMENT.—^An enterprise that is a party to a
proceeding imder section 1341 or 1345 may obtain review of any
final order issued under such section by filing in the United States
Court of Appeals for the District of Coliunbia Circuit, within 30
days after the date of service of such order, a written petition
praying that the order of the Secretary be modified, terminated,
or set aside. The clerk of the court shall transmit a copy of Uie
petition to the Secretary.
(b) FILING OF RECORD.—^Upon receiving a copy of a petition,
the Secretary shall file in the coiut the record in the proceeding,
as provided in section 2112 of title 28, United States Code.
(c) JURISDICTION.—Upon the filing of a petition, such court
shall have jurisdiction, which upon the filing of the record by
the Secretary shall (except as provided in the last sentence of
section 1342(bX2)) be exclusive, to affirm, modify, terminate, or
set aside, in whole or in part, the order of the Secretarv.
(d) REVIEW.—Review of such proceedings shall be governed
by chapter 7 of title 5, United States Code.
(e) ORDER To PAY PENALTY.—Such court shall have the authority in any such review to order payment of any penalty imposed
by the Secretary under this subpart.
(f) No AUTOMATIC STAY.—^The commencement of proceedings
for judicial review under this section shall not, unless specifically
ordered by the court, operate as a stay of any order issued by
the Secretary.
12 u s e 4584.

SEC. 1344. ENFORCEMENT AND JURISDICTION.

(a) ENFORCEMENT.—^The Secretary may request the Attorney
General of the United States to bring an action in the United
States District Court for the District of Columbia for the enforcement of any effective notice or order issued under section 1341
or 1345. Such court shall have jurisdiction and power to order
and require compliance herewith.
(b) LIMITATION ON JURISDICTION.—Except as otherwise provided
in this subpart, no court shall have jurisdiction to affect, by irgunction or otherwise, the issuance or enforcement of any notice or
order under section 1341 or 1345, or to review, modi^, suspend,
terminate, or set aside any such notice or order.
12 u s e 4585.

SEC. 134S. CIVIL MONEY PENALTIER

(a) AUTHORITY.—^The Secretary may impose a civil money penalty, in accordance with the provisions of this section, on any
enterprise that has failed—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3967

(1) to submit a housing plan that substantially complies
with section 1336(c) wiithin the applicable period;
(2) to make a good faith effort to comply with a housing
plan for the enterprise submitted and approved under section
1336(c); or
(3) to submit the information required under subsection
(m) or (n) of section 309 of the Federal National Mortgage
Association Charter Act, subsection (e) or (f) of section 307
of the Federal Home Ix>an Mortgage Corporation Act, or section
1337 of this title.
(b) AMOUNT OF PENALTY.—^The amount of the penalty, as determined by the Secretary, may not exceed—
(1) for any failiire described in subsection (aXD, $25,000
for each day that the failure occurs; and
(2) for any failure described in subsection (a) (2) or (3),
$10,0()0 for each day that the failure occurs.
(c) PROCEDURES.—

(1) ESTABLISHMENT.—^The Secretary shall establish standards and procedures governing the imposition of civil money
penalties under this section. Such standards and procedures—
(A) shall pro^ade for the Secretary to notify the enterprise in writing of the Secretary's determination to impose
the penalty, which shall be made on the record;
(B) shall provide for the imposition of a penalty only
after the enterprise has been given an opportunity for
a hearing on the record pursuant to section 1342; and
(C) may provide for review by the Director for any
determination or order, or interlocutory ruling, arising from
a hearing.
(2) FACTORS IN DETERMINING AMOUNT OF PENALTY.—In

determining the amount of a penalty under this section, the
Secretary shall give consideration to such factors as the gravity
of the offense, any Mstory of prior offenses, ability to pay
the penalty, ii\jury to the public, benefits received, deterrence
of future violations, and such other factors as the Secretary
may determine, by regulation, to be appropriate.
(d) ACTION TO COLLECT PENALTY.—If an enterprise fails to
comply with an order by the Secretary imposing a civil money
penalty under this section, after the order is no longer subject
to review as provided by sections 1342 and 1343, the Secretiary
may request the Attorney (jeneral of the United States to bring
an action in the United States District Court for the District of
Columbia to obtain a monetary judgment against the enterprise
and such other relief as may be available. The monetary judgment
may, in the court's discretion, include the attorneys fees and other
expenses incurred by the United States in connection with the
action. In an action under this subsection, the validity and appropriateness of the order imposing the penalty shall not be subject
to review.
(e) SETTLEMENT BY SECRETARY.—The Secretarv may compromise, modify, or remit any civil money penalty which may be,
or has been, imposed under this section.
(D TRANSITION PERIOD LIMITATION.—The Secretary may not
impose any civil money penalty under this section for any failure
by an enterprise, during the 2-year period beginning on January
1, 1993, to comply wim an approved housing plan, unless tiie

106 STAT. 3968

PUBLIC LAW 102-550—OCT. 28, 1992

Secretary determines that the enterprise has intentionally failed
to make a good faith effort to comply with an approved plan,
(g) DEPOSIT OF PENALTIES.—The Secretai;^ shall deposit any
civil money penalties collected imder this section into the general
fund of the Treasury.
12 u s e 4586.

SEC. 1346. PUBUC DISCLOSURE OF FINAL ORDERS AND AGREEMENTS.

(a) IN GENERAL.—^The Secretary shall make available to the
public—
(1) any written agreement or other written statement for
which a violation may be redressed by the Secretary or any
modification to or termination thereof unless the (Secretary,
in the Secretary's discretion, determines that public disclosure
would be contrary to the public interest or determines under
subsection (c) that public disclosure would seriously threaten
the financial health or security of the enterprise;
(2) any order that is issued with respect to any administrative enforcement proceeding initiated by the Secretary under
this subpart and that has become final in accordance with
sections 1342 and 1343; and
(3) an^ modification to or termination of any final order
made public pursuant to this subsection.
(b) HEARINGS.—^All hearings with respect to any notice of
charges issued by the Secretary shall be open to the public, unless
the Secretary, in the Secretary's discretion, determines that holding
an open hearing would be contrary to the public interest.
(c) DELAY OF P U B U C DISCLOSURE UNDER EXCEPTIONAL CIR-

CUMSTANCES.—If the Secretary makes a determination in writing
that the public disclosure of any final order pursuant to subsection
(a) would seriously threaten the financial soundness of the enterprise, the Secretary may delay the public disclosure of such order
for a reasonable time.
(d) DOCUMENTS FILED UNDER SEAL IN P U B U C ENFORCEMENT

Records.

12 u s e 4587.

HEARINGS.—^The Secretary may file any document or part thereof
under seal in an^ hearing under this subpart if the Secretary
determines in writing that disclosure thereof would be contrary
to the public interest.
(e) RETENTION OF DOCUMENTS.—The Secretary shall keep and
maintain a record, for not less than 6 years, of all documents
described in subsection (a) and all enforcement agreements and
other supervisory actions and supporting documents issued with
respect to or in connection with any enforcement proceeding initiated by the Secretary under this subpart.
(f) DISCLOSURES TO CONGRESS.—^This section mav not be construed to authorize the withholding, or to prohibit the disclosure,
of any information to the Congress or any committee or subcommittee thereof.
SEC. 1347. NOTICE OF SERVICE.

Any service required or authorized to be made by the Secretaiy
under this subpart may be made by registered mail or in such
other manner reasonably calculated to give actual notice, as the
Secretary may by regulation or otherwise provide.
12 u s e 4588.

SEC. 1348. SUBPOENA AUTHORITY.

(a) IN GENERAL.—^In the course of or in connection with anv
administrative proceeding under this subpart, the Secretary shaU
have the authority—
,.
^

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3969

(1) to administer oaths and affirmations;
(2) to take and preserve testimony under oath;
(3) to issue siibpoenas and subpoenas duces tecum; and
(4) to revoke, quash, or modify subpoenas and subpoenas
duces tecum issued by the Secretary.
(b) WITNESSES AND DOCUMENTS.—The attendance of witnesses
and the production of documents provided for in this section may
be required from any place in any State at any designated place
where such proceeding is being conducted.
(c) ENFORCEMENT.—^The Secretary may request the Attorney
General of the United States to brin^ an action in the United
States district court for the judicial district in which such proceeding
is being conducted, or where the witness resides or conducts business, or the United States District Court for the District of Columbia, for enforcement of any subpoena or subpoena duces teciun
issued pursuant to this section. Such courts shall have jurisdiction
and power to order and require compliance therewith.
(d) FEES AND EXPENSES.—^Witnesses subpoenaed under this
section shall be paid the same fees and mileage that are paid
witnesses in the district courts of the United States. Any court
having jurisdiction of any proceeding instituted under this section
by an enterprise may allow to any such party such reasonable
expenses ana attorneys fees as the court deems just and proper.
Such expenses and fees shall be paid by the enterprise or from
its assets.
SEC. 1348. REGULATIONS.

The Secretary shall issue any final regulations necessary to
implement the provisions of this part (not including the provisions
of sections 1332(d), 1333(d), and 1334(d), relating to transition
housing goals) not later than the expiration of the 18-month period
beginning on the date of the enactment of this Act. Such regulations
shall be issued after notice and opportunity for public comment
pursuant to the provisions of section 553 of title 5, United States
Code.

PART 3—MISCELLANEOUS PROVISIONS
SEC. 1361. AMENDMENTS TO TITLE S, UNITED STATES CODE.
(a) DIRECTOR AT LEVEL II OF EXECUTIVE SCHEDULE.—Section

5313 of title 5, United States Code, is amended by inserting at
the end the foUovdng new item:
"Director of the Office of Federal Housing Enterprise Oversight, Department of Housing and Urban Development.".
(b) EXCLUSION FROM SENIOR EXECUTIVE SERVICE.—Section

3132(aXlXD) of title 5, United States Code, is amended bv inserting
*^he OfHce of Federal Housing Enterprise Oversight of me Department of Housing and Urban Development," after "Farm Credit
Administration,".
SEC. 1362. P R O H I B I T I O N OF MERGER OF OFFICE.

Section 5 of the Department of Housing and Urban Development Act (42 U.S.C. 3534) is amended by adding at the end the
following new subsection:
**(d) Notwithstanding any other provision of this Act, the Secretary may not merge or consolidate the Office of Federal Housing
Enterprise Oversight of the Department, or any of the functions

12 USC 4589.

106 STAT. 3970

PUBLIC LAW 102-550—OCT. 28, 1992

or responsibilities of such Office, with any function or program
administered by the Secretary.".
SEC. I S n . PROTECTION OF CONFIDENTIAL INFORBIATION.

Section 1905 of title 18, United States Code, is amended by
inserting "any i>erson acting on behalf of the Office of Federal
Housing Enterprise Oversight," after "or agency thereof,".
12 u s e 4601.

SEC. 1364. REVIEW OF UNDERWRITING GUIDELINEa

(a) STUDY.—^Each of the enterprises shall conduct a study to
review the underwriting guidelines of the enterprise. The studies
shall examine—
(1) the extent to which the underwriting guidelines prevent
or inhibit the purchase or securitization of mortgages for housing located in mixed-use, urban center, and predominantly
mmority neighborhoods and for housing for low- and moderateincome famihes;
(2) the standards employed by private mortgage insurers
and the extent to which such standiards inhibit the purchase
and securitization by the enterprises of mortgages aescribed
in paragraph (1); and
(3) the implications of implementing underwriting standards that—
(A) establish a downpayment requirement for mortgagors of 5 percent or less;
(B) allow the use of cash on hand as a source for
downpayments; and
(U) approve borrowers who have a credit history of
delinquencies if the borrower can demonstrate a satisfactory credit history for at least the 12-month period ending
on the date of the application for the mortgage.
(b) REPORT.—^Not later than the expiration of the 1-year period
beginning on the date of the enactment of this Act, each enterprise
shall submit to the Secretary, the Committee on Banking, Finance
and Urban Affairs of the House of Representatives, and the Committee on Banking, Housing, and Urban Affairs of the Senate a report
regarding the study conducted by the enterprise under subsection
(a). Each report shall include any recommendations of the enterprise
for better meeting the housing needs of low- and moderate-income
families.
12 u s e 4602.

SEC. ISW. STUDIES OF EFFECTS OF PRIVATIZATION OF FNMA AND
FHLMC.

(a) IN GENERAL.—The Comptroller General of the United
States, the Secretary of Housing and Urban Development, the Secretary of the Treasury, and the Director of the Congressional Budget
Office shall each conduct and submit to the Committee on Banking,
Finance and Urban Affairs of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of the
Senate, not later than the expiration of the 2-year period beginning
on the date of the enactment of this Act, a study regardmg the
desirability and feasibility of repealing the Federal charters of
the Federal National Mortage Association and the Federal Home
Loan Mortgage Corporation, eliminating any Federal sponsorship
of the enterprises, and allowing the enterprises to continue to
operate as fully private entities.
(b) REQUIREMENTS.—^Each study shall particularly examine the
effects of such privatization on—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3971

(1) the requirements applicable to the Federal National
Mortgage Association and the Federal Home Loan Mortgage
Corporation under Federal law and the costs to the enterprises;
(2) the cost of capital to the enterprises;
(3) housing afTordability and availability and the cost of
homeownership;
(4) the level of secondary mortgage market competition
subsequently available in the private sector;
(5) whether increased amounts of capital would be necessary for the enterprises to continue operation;
(6) the secondary market for residential loans and the
liquidity of such loans; and
(7) any other factors that the Comptroller General, the
Secretary of Housing and Urban Development, the Secretary
of the Treasury, or the Director of the Congressional Budget
OfiEice deems appropriate to enable the Congress to evaluate
the desirability and feasibility of privatization of the
enterprises.
(c) INFORMATION.—^The Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation shall provide
full and prompt access to the Comptroller General, the Secretary
of Housing and Urban Development, the Secretary of the Treasury,
and the Director of the Congressional Budget Office to any books,
records, and other information requested for the purposes of
conducting the studies under this section.
(d) VIEWS OF THE FNMA AND FHLMC.-(1) CONSIDERATION IN STUDIES.—In conducting the studies

imder this section, the Comptroller General, the Secretary of
Housing and Urban Development, the Secretary of the Treasury, and the Director of the Congressional Budget OfRce shall
each consider the views of the Federal National Mortgage
Association and the Federal Home Loan Mortgage Corporation.
(2) DIRECT REPORT.—The Federal National Mortgage
Association and the Federal Home Loan Mortgage Corporation
may each report directly to the Committee on Banking, Finance
and Urban Affairs of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate on its own analysis of the desirability and feasibility
of repealing the Federal charters of the enterprises, eliminating
any Federal sponsorship, and allowing the enterprises to continue to operate as fully private entities.
SEC. 1366. TRANSITION.

12 USC 4603.

Before the expiration of the period ending 18 months after
the appointment of the Director imder section 1312, any rules
and regulations promulgated before the date of the enactment of
this Act by the Secretary pursuant to the Federal National Mortgage
Association Charter Act or the Federal Home Loan Mortgage Corporation Act shall remain in effect unless modified, terminated,
superseded, or revoked by operation of law or in accordance with
law. Such rules and regulations shall terminate, effective upon Termination
the expiration of such period.
*^®
** '

106 STAT. 3972

PUBLIC LAW 102-550—OCT. 28, 1992

Subtitle B—Required Capital Levels for
Enterprises and Special Enforcement
Powers
12 use 4611.
Regulations.

SEC. 1361. RISK-BASED CAPITAL LEVELS.
(a) RISK-BASED CAPITAL TEST.—The Director shall, by regulation, establish a risk-based capital test under this section for the
enterprises. When applied to an enterprise, the risk-based capital
test shall determine the amount of total capital for the enterprise
that is sufficient for the enterprise to maintain positive capital
during a 10-year period in which the following circumstances occur
(in this section referred to as the ''stress period ):
(1) CREDIT RISK.—^With respect to mortgages owned or
guaranteed by the enterprise and other obligations of the enterprise, -losses occur throughout the United States at a rate
of default and severity (based on any measurements of default
reasonably related to prevailing practice for that industry in
determining capital adequacy) reasonably related to the rate
and severity that occurred in contiguous areas of the United
States containing an aggregate of not less than 5 percent of
the total poptdation of the United States that, for a period
of not less than 2 years, experienced the highest rates of default
and severity of mortgage losses, in compsirison with such rates
of default and severity of mortgage losses in other such areas
for any period of such duration.
(2) INTEREST RATE RISK.—

(A) IN GENERAL.—^Interest rates decrease as described
in subparagraph (B) or increase as described in subparagraph (C), whichever would require more capital for the
enterprise.
(B) DECREASES.—^The 10-year constant maturity Treasury jrield decreases during the first year of the stress
period and will remain at uie new level for the remainder
of the stress period. The yield decreases to the lesser of—
(i) 600 basis points below the average yield during
the preceding 9 months, or
(ii) 60 percent of the average yield during the
preceding 3 years,
but in no case to a yield less than 50 percent of the
average jrield during the preceding 9 months.
(C) INCREASES.—^The 10-year constant maturity Treasury yield increases during the first year of the stress period
and will remain at the new level for the remainder of
the stress period. The jdeld increases to the greater of—
(i) 600 basis points above the average 3deld during
the preceding 9 months, or
(ii) 160 percent of the average yield during the
preceding 3 years,
but in no case to a yield greater than 175 percent of
the average yield during the preceding 9 months.
(D) DIFFERENT TERMS TO MATURITY.—^Yields of Treasury instruments with other terms to maturity will change
relative to the 10-year constant maturity Treasury yield
in patterns and for durations that are reasonably related

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3973

to historical experience and are judged reasonable by the
Director.
(E) LARGE INCREASES IN YIELDS.—If the 10-year constant maturity Treasury yield is assumed to increase by
more than 50 percent over the average yield during the
preceding 9 months, the Director shall adjust the losses
in paragraphs (1) and (3) to reflect a correspondingly higher
rate of general price inflation.
(3) NEW BUSINESS.—

(A) IN GENERAL.—^Any contractual commitments of the
enterprise to purchase mortgages or issue securities will
be fulfilled. The characteristics of resulting mortgage purchases, securities issued, and other financing will be
consistent with the contractual terms of such commitments,
recent experience, and the economic characteristics of the
stress period. No other purchases of mortgages shall be
assumed, except as provided in subparagraph (B).
(B) ADDITIONAL NEW BUSINESS.—The Director may,
after consideration of each of the studies required by
subparagraph (C), assume that the enterprise conducts
additional new biisiness during the stress period consistent
with the following—
(i) AMOUNfT AND PRODUCT TYPES.—The amount and
types of mortgages purchased and their financing will
be reasonably related to recent experience and the
economic characteristics of the stress period.
(ii) LOSSES.—Default and loss severity characteristics of mortgages purchased will be reasonably related
to historical experience.
(iii) PRICING.—^Prices charged by the enterprise in
purchasing new mortgages will be reasonably related
to recent experience and the economic characteristics
of the stress period. The Director may assume that
a reasonable period of time would lapse before the
enterprise would recognize and react to the characteristics of the stress period.
(iv) INTEREST RATE RISK.—Interest rate risk on
new mortgages purchased will occur to an extent
reasonably related to historical experience.
(v) RESERVES.—^The enterprise must maintain
reserves during and at the end of the stress period
on new business conducted during the first 5 years
of the stress period reasonably related to the expected
future losses on such business, consistent with generally accepted accounting principles and industry
accounting practice.
(C) STUDIES.—^Within 1 year after regulations are first
issued imder subsection (e), the Director of the Congressional Budget Office, and the Comptroller General of the
United States shall each submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Banking, Finance and Urban Affairs of the
House of Representatives a study of the advisability and
appropriate form of any new business assumptions luider
subparagraph (B).

106 STAT. 3974

PUBLIC LAW 102-550—OCT. 28, 1992
(D) EFFECTIVE DATE.—^The provisions of subparagraph
(B) shall become effective 4 years after regulations are
first issued under subsection (e).
(4) OTHER ACTIVITIES.—Losses or gains on other activities,
including interest rate and foreign exchange hed^ng activities,
shall be determined by the Director, on the basis of available
information, to be consistent with the stress period.
(b) CONSIDERATIONS.—

(1) IN GENERAL.—^In establishing the risk-based capital test
imder subsection (a), the Director shall take into account appropriate distinctions among types of mortgage products, differences in seasoning of mortgages, and any other factors the
Director considers appropriate.
(2) CONSISTENCY.—^Characteristics of the stress period
other than those specifically set forth in subsection (a), such
as prepayment experience and dividend policies, will be those
determined by the Director, on the basis of available information, to be most consistent with the stress period.
(c) RISK-BASED CAPITAL LEVEL.—For purposes of this subtitle,
the risk-based capital level for an enterprise shall be equal to
the sum of the following amounts:
(1) CREDIT AND INTEREST RATE RISK.—The amount of total
capital determined by applying the risk-based capital test under
subsection (a) to the enterprise.
(2) MANAGEMENT AND OPERATIONS RISK.—To provide for
management and operations risk, 30 percent of tne amount
of total capital determined by applying the risk-based capital
test under subsection (a) to the enterprise.
(d) DEFINITIONS.—For piuposes of this section:
(1) SEASONING.—^The term "seasoning" means the change
over time in the ratio of the unpaid principal balance of a
mortgage to the value of the property by whioi such mortgage
loan is secured, determined on an annual basis by region,
in accordance with the Constant Quality Home Price Index
published by the Secretary of Commerce (or any index of similar
quality, authority, and public availability that is regularly used
by the Federal Giovemment).
(2) TYPE OF MORTGAGE PRODUCT.—The term "type of mortgage product" means a classification of one or more mortgage
proiducts, as established by the Director, which have similar
characteristics from each set of characteristics under the following subparagraphs:
(A) The prii;t>erty securing the mortgage is—
(i) a residential property consisting of 1 to 4 dwelling units; or
(ii) a residential property consisting of more than
4 dwelling units.
(B) The interest rate on the mortgage is—
(i) fixed; or
(ii) adjustable.
(C) The priority of the lien securing the mortgage
18—

(i) first; or
. (ii) second or other.
(D) The term of the mortgage is—
(i) 1 to 15 years;
(ii) 16 to 30 years; or

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3975

(iii) more than 30 years.
(E) The owner of the property is—
(i) an owner-occupant; or
(ii) an investor.
(F) The unpaid principal balance of the mortgage—
(i) will amortize completely over the term of the
mortgage and will not increase significantly at any
time during the term of the mortgage;
(ii) will not amortize completely over the term
of the mortgage and will not increase significantly
at any time during the term of the mortgage; or
(lii) may increase significantly at some time during
the term of the mortgage.
(G) Any other characteristics of the mortgage, as the
Director may determine.
(e) REGULATIONS.—

(1) ISSUANCE.—The Director shall issue final regulations
establishing the risk-based capital test imder this section not
later than the expiration of the 18-month period beginning
on the date of the appointment of the Director. Such regulations
shall be issued after notice and opportunity for public comment
ursuant to the provisions of section 553 of title 5, United
tates Code, and shall take effect upon issuance.
(2) CONTENTS.—^The regulations under this subsection shall
contain specific requirements, definitions, methods, variables,
and parameters used under the risk-based capital test and
in implementing the test (such as loan loss severity, fioat
income, loan-to-value ratios, taxes, jrield curve slopes, default
experience, and prepayment rates). The regulations shall be
sufficiently specific to permit an individual other than the
Director to apply the test in the same manner as the Director.
(3) CONFIDENTIALITY OF INFORMATION.—Any person that
receives any book, record, or information from the Director
or an enterprise to enable the risk-based capit£d test to be
applied shall—
(A) maintain the confidentiality of the book, record,
or information in a manner that is generally consistent
with the level of confidentiality established for the material
by the Director or the enterprise; and
(B) be exempt from section 552 of title 5, United States
Code, with respect to the book, record, or information.
(f) AVAILABILITY OF MODEL.—The Director shall provide copies
of the statistical model or models used to implement the riskbased capital test under this section to the Secretary, the Board
of Governors of the Federal Reserve System, the Director of the
Office of Management and Budget, the Comptroller General of
the United States, and the Director of the Congressional Budget
OfiEice. The Director shall make copies of such model or models
available for public acquisition and may charge a reasonable fee
for such copies.

g

SEC. 1382. MINIMUM CAPITAL LEVELS.

(a) IN GENERAL.—^For purposes of this subtitle, the minimum
capital level for each entetrprise shall be the sum of—
(1) 2.50 percent of the aggregate on-balance sheet assets
of the enterprise, aei determined in accordance with generally
accepted accounting principles;

•
12 USC 4612.

106 STAT. 3976

PUBLIC LAW 102-550—OCT. 28, 1992

(2) 0.45 percent of the unpaid principal balance of outstanding mortgage-backed securities and substantiall}^ equivalent
instruments issued or guaranteed by the enterprise that are
not included in paragraph (1); and
(3) 0.45 percent of other off-balance sheet obligations of
the enterprise not included in paragraph (2) (excluding commitments in excess of 50 percent of the average dollar amoimt
of the commitments outstanding each quarter over the preceding 4 quarters), except that uie Director shall a4just such
percentage to reflect differences in the credit risk of such obligations in relation to the instruments included in paragraph
(2).
(b) TRANSITION.—^Notwithstanding subsection (a), during the
18-month period beginning upon the date of the enactment oi this
Act, the minimum capital level for each enterprise shall be the
sum o—
f
(1) 2.25 percent of the aggregate on-balance sheet assets
of the enterprise, as determined in accordance with generally
accepted accounting principles;
(2) 0.40 percent of the unpaid principal balance of outstanding mortgage-backed securities and substantially equivalent
instruments issued or guaranteed by the enterprise that are
not included in paragraph (1); and
(3) 0.40 percent of other off-balance sheet obligations of
the enterprise not included in paragraph (2) (excluding commitments in excess of 50 percent of the average dollar amount
of the commitments outstanding each quarter over the preceding 4 quarters), except that the Director shall adjust such
percentage to reflect differences in the credit risk of such obligations in relation to the instruments included in paragraph
(2).
12 u s e 4613.

SEC. 1363. CRITICAL CAPITAL LEVELS.

For purposes of this subtitle, the critical capital level for each
enterprise shall be the simi of—
(1) 1.25 percent of the aggregate on-balance sheet assets
of the enterprise, as determined m accordance with generally
accepted accoimting principles;
(2) 0.25 percent of the unpaid principal balance of outstanding mortgage-backed securities and substantially equivalent
instruments issued or guaranteed by the enterprise that are
not included in paragraph (1); and
(3) 0.25 percent of other off-balance sheet obligations of
the enterprise not included in paragraph (2) (excluding commitments in excess of 50 percent of the average dollar amount
of the commitments outstanding each quarter over the preceding 4 quarters), except that the Director shall adjust such
percentage to reflect differences in the credit risk of such obligations in relation to the instruments included in paragraph
(2).
12 u s e 4614.

SEC. 1364. CAPITAL CLASSIFICATIONS.

(a) IN GENERAL.—For purposes of this subtitle, the Director
shall classify the enterprises according to the following capital
classifications:
(1) ADEQUATELY CAPITALIZED.—An enterprise shall be
classified as adequately capitalized if the enterprise—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3977

(A) maintains an amount of total capital that is equal
to or exceeds the risk-based capital level established for
the enterprise under section 1361; and
(B) maintains an amount of core capital that is equal
to or exceeds the minimum capital level established for
the enterprise undcsr section 1362.
(2) UNDERCAPITAL]:ZED.—^An enterprise shall be classified
as undercapitalized if—(A) the enterprise—
(i) does not maintain an amoimt of total capital
that is equal to or exceeds the risk-based capital level
established for the enterprise; and
(ii) maintains an amount of core capital that is
equal to or exceeds the minimum capital level established for the enterprise; or
(B) the enterprise is otherwise classified as
undercapitalized unaer subsection (bXD of this section.
(3) SIGNIFICANTLY UNDERCAPITALIZED.—An enterprise shall
be classified as significantly imdercapitalized if—
(A) the enterprise—
(i) does not maintain an amount of total capital
that is equal to or exceeds the risk-based capital level
established for the enterprise;
(ii) does not maintain an amount of core capital
that is equal to or exceeds the minimiun capital level
established for the enterprise; and
(iii) maintains an amount of core capital that is
equal to or exceeds the critical capital level established
for the enterprise under section 1363; or
(B) the enterprise is otherwise classified as significantly undercapitalized under subsection (bX2) of this section or section 1365(b).
(4) CRITICALLY UNDERCAPITALIZED.—An enterprise shall be
classified as critically undercapitalized if—
(A) the enterprise—
(i) does not maintain an amount of total capital
that is equal to or exceeds the risk-based capital level
established for the enterprise; and
(ii) does not maintain an amount of core capital
that is equal to or exceeds the critical capital level
for the enterprise; or
(B) is otherwise classified as critically undercapitalized
under subsection (bX3) of this section or section 1366(bX5).
(b) DISCRETIONARY CLASSIFICATION.—If at any time the Director
determines in writing that an enterprise is engaging in conduct
not approved by the Director that could result in a rapid depletion
of core capital or that the value of the property subject to mortgages
held or securitized by the enterprise has decreased significantly,
the Director may classify the enterprise—
(1) as undercapitalized, if the enterprise is otherwise classified as adequately capitalized;
(2) as significantly imdercapitalized, if the enterprise is
otherwise classified as undercapitialized; and
(3) as critically undercapitalized, if the enterprise is otherwise classified as significantly undercapitalized.
(c) QUARTERLY DETERMINATION.—^The Director shall determine
the capital classification of the enterprises for purposes of this

106 STAT. 3978

PUBLIC LAW 102-550—OCT. 28, 1992

subtitle on not less than a quarterly basis (and as appropriate
under subsection (b)). The first such determination shall be made
during the 3-month period beginning on the appointment of the
Director.
(d) IMPLEMENTATION.—^Notwithstanding any other provision of
this section, during the period beginning on the date of the enactment of this Act and ending upon the effective date of section
1365 (as provided in section 1365(c)), an enterprise shall be classified as adequately capitalized if the enterprise maintains an amount
of core capital that is equal to or exceeds the minimum capital
level for the enterprise under section 1362.
12 u s e 4615.

SEC. 1366. SUPERVISORY ACTIONS APPUCABLE TO UNDERCAPITALIZED ENTERPRISES.
(a) MANDATORY ACTIONS.—
(1) CAPITAL RESTORATION PLAN.—An enterprise that is

classified as undercapitalized shall, within the time period provided in section 1369C (b) and (d), submit to the Director
a capital restoration plan that complies with section 1369C
and carry out the plan after approval.
(2) RESTRICTION ON CAPITAL DISTRIBUTIONS.—An enterprise
that is classified as undercapitalized may not make any capital
distribution that would result in the enterprise being reclassified as significantly undercapitalizea or critically
undercapitalized.

(b) DISCRETIONARY RECLASSIFICATION FROM UNDERCAPITALIZED
TO SIGNIFICANTLY UNDERCAPITALIZED.—The Director may reclassify

as significantly imdercapitalized an enterprise that is classified
as undercapitalized (and the enterprise snail be subject to the
provisions of section 1366) if—
(1) the enterprise does not submit a capital restoration
plan that is substantially in compliance with section 1369C
within the applicable period or the Director does not approve
the capital restoration plan submitted by the enterprise; or
(2) the Director determines that the enterprise has failed
to make, in good faith, reasonable efforts necessary to comply
with the capital restoration plan and fulfill the schedule for
the plan approved by the Director.
(c) EFFECTIVE DATE.—This section shall take effect upon the
expiration of the 1-year period beginning on the date of the effectiveness of the regulations issued under section 1361(e) establishing
the risk-based capital test.
12 u s e 4616.

SEC. 1366. SUPERVISORY ACTIONS APPUCABLE TO SIGNIFICANTLY
UNDERCAPITALIZED ENTERPRISES.
(a) MANDATORY SUPERVISORY ACTIONS.—
(1) CAPITAL RESTORATION PLAN.—An enterprise that is

classified as significantly undercapitalized shall, within the
time period under section 1369C (b) and (d), submit to the
Director a capital restoration plan that complies with section
1369C and carry out the plan after approval.
(2) RESTRICTIONS ON CAPITAL DISTRIBUTIONS.—
(A) PRIOR APPROVAL.—^An enterprise that

is classified
as si^ificantly undercapitalized may not make any capital
distribution that would result in the enterprise being
reclassified as critically imdercapitalized. An enterprise
that is classified as significantly imdercapitalized enter-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3979

prise may not make any other capital distribution unless
the Director approves the distribution.
(B) STANDARD FOR APPROVAL.—The Director may
approve a capital distribution by an enterprise classified
as significantly imdeircapitalized only if the Director determines that the distribution (i) wiU enhance the ability
of the enterprise to meet the risk-based capital level and
the minimum capital level for the enterprise promptly,
(ii) will contribute to the long-term financial safety and
soundness of the enterprise, or (iii) is otherwise in the
public interest.
(b) DISCRETIONARY SUPERVISORY ACTIONS.—In addition to any
other actions taken by the Director (including actions \mder subsection (a)), the Director may, at any time, take any of the following
actions with respect to an enterprise that is classified as significantly imdercapitalized:
(1) LIMITATION ON INCREASE IN OBUGATIONS.—Limit any

increase in, or order the reduction of, any obligations of the
enterprise, including off-balance sheet obligations.
(2) LIMITATION ON GROWTH.—Limit or prohibit the growth
of the assets of the enterprise or require contraction of the
assets of the enterprise.
(3) ACQUISITION OF NEW CAPITAL.—Require the enterprise
to acquire new capital in a form and amount determined by
the Director.
(4) RESTRICTION OF ACTIVITIES.—^Require the enterprise to
terminate, reduce, or modify any activity that the Director
determines creates excessive risk to the enterprise.
(5) RECLASSIFICATION FROM SIGNIFICANTLY TO CRITICALLY

UNDERCAPITALIZED.—^The Director may reclassify as critically
undercapitalized an enterprise that is classified as significantly
undercapitalized (and the enterprise shall be subject to the
provisions of section 1367) if—
(A) the enterprise does not submit a capital restoration
plan that is substantially in compliance with section 1369C
within the applicable period or the Director does not
approve the capital restoration plan submitted by the enterprise; or
(B) the Director determines that the enterprise has
failed to make, in good faith, reasonable efforts necessary
to comply with the capital restoration plan and fulfill the
schedule for the plan approved by the Director.
(6) CONSERVATORSHIP.—^Appoint a conservator for the
enterprise in accordance with the provisions of section 1369
(excluding subsection (a) (1) and (2)), but only if the Director
determines—
(A) that the amovmt of core capital of the enterprise
is less than the minimum capital level established for
the enterprise under section 1362; and
(B) that alternative remedies available to the Director
under this title are not satisfactory.
(c) EFFECTIVE DATE.—-This section shall take effect upon the
first classification of the enterprises within capital classifications
that occurs under section 1364.

106 STAT. 3980
12 u s e 4617.

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 1367. APPOINTMENT OF CONSERVATORS FOR CRITICALLY
UNDERCAPITAUZEO ENTERPRISEa
(a) APPOINTMENT.—

(1) IN GENERAL.—^Upon a determinatioii and notice under
section 1368(d) that an enterprise is critically undercapitalized
and not later than 30 days after providing notice under section
1369(aX3), the Director shall appoint a conservator for the
enterprise in accordance with the provisions of section 1369
(excluding subsections (a) (1) and (2)).
(2) EXCEPTION.—Notwithstanding paragraph (1), the Director may determine not to appoint a conservator for an enterprise classified as critically undercapitalized, but only pursuant
to a written finding by the Director, with the written concurrence of the Secretajry of the Treasury, that—
(A) the appointment of a conservator would have serious adverse enects on economic conditions of nationcd financial markets or on the financial stability of the housing
finance market; and
(B) the public interest would be better served by taking
some other enforcement action authorized under this title.
(b) AUTHORITY.—^The Director shall have the authority to take
any actions under sections 1365 and 1366 with respect to an enterprise under conservatorship.
(c) APPROVAL OP ACHVITIES.—

(1) CONSERVATOR.—^The conservator of any enterprise
classified as critically undercapitalized may undertake an activitv subject to the approval of the Secretary under section 1322
of this title only with the additional approval of the Director.
(2) No CONSERVATOR.—^If the Director determines under
subsection (aX2) not to appoint a conservator for an enterprise
classified as critically unaercapitalized, the provisions of section
1366 shall apply with respect to the enterprise.
(d) EFFECTIVE DATE.—^This section shall take effect imon the
first classification of the enterprises within capital classifications
that occurs under section 1364.
12 u s e 4618.

SEC. 1368. NOTICE OF CLASSIFICATION AND ENFORCEMENT ACTION.

(a) NOTICE.—^Before taking any action referred to in subsection
(b), the Director shall provide to the enterprise written notice of
tibe proposed action, which states ttie reasons for the proposed
action and the information on which the proposed action is based.
(b) APPLICABILITY.—^The requirements of subsection (a) shall
apply to the following actions:
(1) Classification or reclassification of an enterprise within
a particular capital classification under section 1364.
(2) Any discretionary supervisory action pursuant to section
1365.
(3) Any discretionary supervisory action pursuant to section
1366 except a decision to appoint a conservator under section
1366(bX6).
Notice of classification under paragraph (1) and notice of supervisory actions under paragraph (2) or (3) may be provided together
in a single notice under subsection (a).
(c) RESPONSE PERIOD.—

(1) IN GENERAL.—^During the 30-day period beginning on
the date that an enterprise is provided notice under subsection
(a) of a proposed action, the enterprise may submit to the

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3981

Director any information relevant to the action that the enterprise considers appropriate for consideration by the Director
in determining whether to take such action. The Director may,
at the discretion of the Director, hold an informal administrative hearing to receive and discuss such information and the
proposed determination.
(2) EXTENDED PERIOD.—^The Director may extend the period
under paragraph (1) for good cause for not more than 30 additional days.
(3) SHORTENED PERIOD.—The Director may shorten the
period under paragraph (1) if the Director determines that
the condition of the enterprise so requires or the enterprise
consents.
(4) FAILURE TO RESPOND.—The failure of an enterprise
to provide information during the response period under this
subsection (as extended or shortened) shall waive any right
of the enterprise to comment on the proposed action of the
Director.
(d) CONSIDERATION OP INFORMATION AND DETERMINATION.—

After the expiration of the response period under subsection (c)
or upon receipt of information provided during such period by
the enterprise, whichever occurs earlier, the Director shall determine whether to take the action proposed, taking into consideration
any relevant information submitted by the enterprise during the
response period. The Dire<;tor shall provide written notice of a
determination to take action and the reasons for such determination
to the enterprise, the Committee on Banking, Finance and Urban
AfTairs of the House of Representatives, and the Committee on
Bcmking, Housing, and Urban Affairs of the Senate. Such notice
shall respond to any information submitted during the response
period.
(e) EFFECJTIVE DATE OF ACTIONS.—An action referred to in
subsection (b) shall take effect upon receipt by the enterprise of
notice of the determination of the Director under subsection (d),
unless otherwise provided in such notice.
SEC. 1368. APPOINTMENT OF CONSERVATORS.
(a) APPOINTMENT.—
(1) DISCRETIONARY AUTHORITY.—The

Director may, after
providing notice under paragraph (3), appKDint a conservator
for an enterprise upon a determination in writing—
(A) that alternative remedies available to the Director
under this title are not satisfactory; and
(B) that—
(i) the enterprise is not likely to pay its obligations
in the normal course of business;
(ii) the enterprise has incurred or is reasonably
likely to incui* losses that would deplete substantially
all of its core capital and it is unlikely that the enterprise will replenish its core capital within a reasonable
period;
(iii) the enterprise has concealed or is concealing
books, papers, records, or assets of the enterprise that
are material to the discharge of the Directors responsibilities under this subtitle, or has refused or is
refusing to submit such books, papers, records, or

12 USC 4619.

106 STAT. 3982

PUBLIC LAW 102-550—OCT. 28, 1992
information regarding the affairs of the enterprise for
inspection to the Director upon request; or
(iv) the enterprise has willAilly violated, or is willfully violating, a final cease-ana-desist order under
section 1371.
(2) CONSENT OF ENTERPRISE.—^Notwithstanding paragraph
(1), the Director may appoint a conservator for an enterprise
if the enterprise, by an afiirmative vote of a m^'ority of the
members of its board of directors or by an afi&nnative vote
of a majority of its shareholders, consents to such appointment.
(3) NOTICE.—^Upon making a determination imder paragraph (1) of this subsection or under section 1366 or 1367
to appoint a conservator for an enterprise, or upon consent
of the enterprise under paragraph (2) to such an appointment,
the Director shall provide written notice to the enterprise,
the Committee on Banking, Finance and Urban Affairs of the
House of Representetives, and the Committee on Banking,
Housing, and Urban Affairs of the Senate—
(A) that a conservator will be appointed for the
enterprise;
(B) stating the reasons for the appointment of the
conservator; and
(C) identifying the person or governmental agency that
the Director intends to appoint as conservator.
(4) QUAUFICATIONS.—The conservator shall be—
(A) the Director or any other governmental agency;
or
(B) any person that—
(i) has no claim against, or financial interest in,
the enterprise or other basis for a conflict of interest;
and
(ii) has the financial and management expertise
necessaiy to direct the operations and affairs of the
enterprise,
(b) JUDICIAL REVIEW.—
(1) TIMING AND JURISDICTION.—Except as provided in para-

graph (2), an enterprise for which a conservator is appointed
(pursuant to this section or section 1366 or 1367) may bring
an action in the United Stotes District Court for the District
of Columbia for an order requiring the Director to terminate
the appointment of the conservator. The court, upon the merits,
shall dismiss such action or shall direct the Director to terminate the appointment of the conservator. Such an action may
be commenced only during the 20-day period beginning upon
the appointment of the conservator.
(2) CONSENSUAL APPOINTMENTS.—Appointment of a conservator pursuant to consent of the enterprise under subsection
(aX2) shall not be subject to judicial review under this subsection.
(3) STANDARD OF REVIEW.—A decision of the Director to
appoint a conservator may be set aside under this subsection
only if the court finds that the decision was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance
witii applicable laws.
(4) LIMITATION ON JURISDICTION.—Except as otherwise provided in this subsection, no court may take any action regarding

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3983

the removal of a conservator or otherwise restrain or affect
the exercise of powers orftuictionsof a conservator.
(c) REPLACEMENT.—^The Director may, without notice or hearing, replace a conservator with another conservator. Such replacement shall not affect the right of the enterprise under subsection
(b) to obtain judicial review of the decision of the Director to
appoint a conservator.
(d) EXAMINATIONS.—^The Director may examine and supervise
any enterprise in conservatorship during the period in which the
enterprise continues to operate as a going concern.
(e) TERMINATION.—

(1) DISCRETIONARY.—^At any time the Director determines
that termination of a conservatorship pursuant to an appointment under subsection (a) is in the pubUc interest and may
safely be accomplished, the Director may terminate the
conservatorship and permit the enterprise to resume the transaction of its business subject to such terms, conditions, and
limitations as the Director may prescribe.
(2) MANDATORY.—The Director shall terminate a
conservatorship initiated pursuant to section 1366 or 1367 upon
a determination by the Director that the enterprise has maintained an amount of core capital that is equal to or exceeds
the minimum capital level for the enterprise established imder
section 1362, and may by written order prescribe such terms,
conditions, and limitations on the enterprise as the Director
considers appropriate.
(3) TERMS.—Any terms, conditions, and Umitations imposed
by the Director upon termination of a conservatorship shall
be enforceable and reviewable under the provisions of sections
1374 and 1375, to the same extent as any cease-and-desist
order issued pursuant to subtitle C.
SEC. 1388A. POWERS OF CONSERVATORa
(a) GENERAL POWERS.—^A conservator shall have all the powers

of the shareholders, directors, and officers of the enterprise under
conservatorship and may operate the enterprise in the name of
the enterprise, imless the Director provides otherwise.
(b) AbDmONAL POWER.—^A conservator may avoid any security
interest taken by a creditor with the intent to hinder, delay, or
defraud the enterprise or the creditors of the enterprise.
(c) LIMITATIONS BY DIRECTOR.—^A conservator shall be subject
to any rules, regulations, and orders issued from time to time
by the Director and, except as otherwise specifically provided in
such rules, regulations, or orders or in section 1369B, shall have
the same rights and privileges and be subject to the same duties,
restrictions, penalties, conditions, and Imiitations applicable to
directors, officers, or employees of the enterprise.
(d) ENFORCEMENT OF CONTRACTS.—

(1) IN GENERAL.—^A conservator may enforce any contract
described in paragpraph (2), notwithstanding any provision of
the contract providing for the termination, default, acceleration,
or other exercise of rights upon, or solely by reason of, the
insolvency of the enterprise or the appointment of a conservator.
(2) ENFORCEABLE CONTRACTS.—Any contract that is within
a class of contracts shall be enforceable under paragraph (1)
if the Director—

12 USC 4620.

106 STAT. 3984

PUBLIC LAW 102-550—OCT. 28, 1992
(A) determines that the continued enforceability of such
class of contracts is necessary to achieve the purpose of
the conservatorship; and
(B) specifically provides for the enforceability of such
class of contracts in a regulation or order, issued for the
purpose of this subsection, which describes such class.
(3) APPLICABILITY.—^This subsection and any regulation or
order issued under this subsection shall apply only to contracts
entered into, modified, extended, or renewed after the effective
date of the regulation or order.
(e) STAYS.—

(1) IN GENERAL.—^Not later than 45 days after appointment
pursuant to section 1366, 1367, or 1369, or 45 days afi«r
receipt of actual notice of an action or proceeding that is pending at the time of appointment, a conservator may request
that any judicial action or proceeding to which the conservator
or the enterprise is or may become a party be stayed for
a period not exceeding 45 days after the request. Upon petition,
the court shall grant such stay as to all parties.
(2) FEDERAL AGENCY AS CONSERVATOR.—In any case in
which the conservator appointed for an enterprise is a Federal
agency or an officer or employee of the Federal Government,
the conservator may make a request for a stay under paragraph
(1) only with the prior consent of the Attorney General and
subject to the direction and control of the Attorney General.
(f) PAYMENT OF CREDITORS.—^The Director may require a conservator to set aside and make available for payment to creditors
any amounts that the Director determines may safely be used
for such purpose. All creditors who are similarly situated shall
be treated in a similar manner.
(g) COMPENSATION OF CONSERVATOR AND EMPLOYEES.—A conservator and professional employees (other than Federal employees)
appointed to represent or assist the conservator may be compensated for activities conducted as conservator. Compensation may
not be provided in amounts greater than the compensation paid
to employees of the Federal Government for similar services, except
that the Director may provide for compensation at higher rates
(but not in excess of rates prevailing in the private sector), if
the Director determines that compensation at higher rates is necessary in order to recruit and retain competent personnel.
(h) EXPENSES.—^All expenses of a conservatorship pursuant to
this section (including compensation pursuant to subsection (f))
shall be paid by the enterprise under conservatorship and shall
be secured by a lien on the enterprise, which shall have priority
over any other lien.
(i) CONFLICTS OF INTEREST AND FINANCIAL DISCLOSURE.—A

conservator shall be subject to any laws and regulations relating
to conflicts of interest and financial disclosure that apply to employ;ees of the Office.
12 u s e 4621.

SEC. 1369B. LIABILITY PROTECTION FOR CONSERVATORS.
(a) FEDERAL AGENCIES AND EMPLOYEES.—In any case

in which
a conservator appointed under this subtitle is a Federal agency
or an officer or employee of the Federal Government, the provisions
of chapters 161 and 171 of title 28, United States Code, shall
apply with respect to the liability of the conservator for acts or

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3985

omissions performed pursuant to and in the course of the duties
and responsibilities of the conservatorship.
(b) OTHER CONSERVATORS.—^In anv case where the conservator
is not a conservator described in subsection (a), the conservator
shall not be personally liable for damages in tort or otherwise
for acts or omissions performed pursuant to and in the course
of the duties and responsibilities of the conservatorship, unless
such acts or omissions constitute g^ross negligence or any form
of intentional tortious conduct or criminal conduct.
(c) INDEMNIFICATION.—The Director, with the approval of the
Attorney Greneral, may indemnify the conservator on such terms
as the Director considers appropriate.
SEC. 1368C. CAPITAL RESTORATION PLANS.

12 USC 4622.

(a) CONTENTS.—^Each capital restoration plan submitted under
this subtitle shall set forth a feasible plan tor restoring the core
capital of the enterprise subject to the plan to an amount not
less than the minimum capital level for the enterprise and for
restoring the total capital oi the enterprise to an amount not less
than the risk-based capital level for the enterprise. Each capital
restoration plan shall—
(1) specify the level of capital the enterprise will achieve
and maintain;
(2) describe the actions that the enterprise will take to
become classified as adequately capitalized;
(3) establish a schedule for completing the actions set forth
in the plan;
(4) specify the types and levels of activities (including existing and new programs) in which the enterprise will engage
during the term of the plan; and
(5) describe the actions that the enterprise will take to
comply with any mandatory and discretionary requirements
imposed under this subtitle.
(b) DEADLINES FOR SUBMISSION.—The Director shall, by regula- Regulations.
tion, establish a deadline for submission of a capital restoration
plan, which may not be more than 45 days after the enterprise
IS notified in writing that a plan is required. The regulations
shall provide that the Director may extend the deadline to the
extent that the Director determines it necessary. Any extension
of the deadline shall be in writing and for a time certain.
(c) APPROVAL.—^The Director shall review each capital restoration plan submitted under this section and, not later than 30
days after submission of the plan, approve or disapprove the plan.
The Director may extend the period for approval or disapproval
for any plan for a single additional 30-day period if the Director
determines it necessary. The Director shall provide written notice
to any enterprise submitting a plan of the approval or disapproval
of the plan (which shall include the reasons for any disapproval
of the plan) and of any extension of the period for approval or
disapproval.
(d) RESUBMISSION.—^If the Director disapproves the initial capital restoration plan submitted by the enterprise, the enterprise
shall submit an amended plan acceptable to the Director within
30 days or such longer period that the Director determines is
in the public interest.
SEC. 1369D. JUDICIAL REVIEW OF DIRECTOR ACTION.
(a) JURISDICTION.—
< ^-

12 USC 4623.
A--*^.^

106 STAT. 3986

PUBLIC LAW 102-550—OCT. 28, 1992

(1) FILING OF PETITION.—^An enteiprise that is not classified
as critically undercapitalized and is the subject of a classification under section 1364 or a discretionary supervisory action
taken under this subtitle by the Director (other than action
to appoint a conservator under section 1366 or 1367 or action
under section 1369) may obtain review of the classification
or action by filing, within 10 days after receiving written notice
of the Director's action, a written petition requesting that the
classification or action of the Director be modified, terminated,
or set aside.
(2) PLACE FOR FILING.—^A petition filed pursuant to this
subsection shall be filed in the United States Court of Appeals
for the District of Columbia Circuit.
(b) SCOPE OF REVIEW.—The Court may modify, terminate, or
set aside £ui action taken by the Director and reviewed by the
Court pursuant to this section only if the court finds, on the record
on which the Director acted, that the action of the Director was
arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with applicable laws.
(c) UNAVAILABILITY OF STAY.—The commencement of proceedings for judicial review pursuant to this section shall not operate
as a stay of any action taken by the Director. Pending judicial
review of the action, the court shall not have jurisdiction to stay,
enjoin, or otherwise delay any supervisory action taken by the
Director with respect to an enterprise that is classified as significantly or critically imdercapitalized or any action of the Director
that results in the classification of an enterprise as significantly
or critically undercapitalized.
(d) LIMITATION ON JURISDICTION.—Except as provided in this
section, no court shall have jurisdiction to affect, by ii\junction
or otherwise, the issuance or effectiveness of any classification
or action of the Director under this subtitle (other than appointment
of a conservator under section 1366 or 1367 or action under section
1369) or to review, modify, suspend, terminate, or set aside such
classification or action.

Subtitle C—^Enforcement Provisions
12 u s e 4631.

SEC. 1371. CEASE-AND-DESIST PROCEEDINGS.
(a) GROUNDS FOR ISSUANCE AGAINST ADEQUATELY CAPITAUZED

ENTERPRISES.—The Director may issue and serve a notice of charges
imder this section upon an enterprise that is classified (for purposes
of subtitle B) as adequately capitalized or upon any executive officer
or director of such an enterprise, if in the determination of the
Director, the enterprise, executive officer, or director is engaging
or has engaged, or the Director has reasonable cause to believe
that the enterprise, executive officer, or director is about to engage,
in—
(1) any conduct that threatens to cause a significant depletion of the core capital of the enterprise;
(2) any conduct or violation that may result in the issuance
of an order described in subsection (dXD; or
(3) anv conduct that violates—
(A) any provision of this title, the Federal National
Mortgage Association Charter Act, the Federal Home Loan
Mortgage Corporation Act, or any order, rule, or regulation

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3987

under any such title or Act, except that the Director may
not enforce compliance with any housing eoal established
under subpart B of part 2 of subtitle A of this title, with
section 1336 or 1337 of this title, or with subsection (m)
or (n) of section 309 of the Federal National Mortgage
Association Charter Act or subsection (e) or (f) of section
307 of the Federal Home Loan Mortgage Corporation Act;
or
(B) any written agreement entered into by the enterprise with the Director.
(b) GROUNDS FOR ISSUANCE AGAINST UNDERCAPITALIZED,
SIGNIFICANTLY
UNDERCAPITAUZED,
AND
CRITICALLY
UNDERCAPITALIZED ENTERPRISES.—The Director may issue and

serve a notice of charges under this section upon an enterprise
classified (for purposes of subtitle B) as undercapitalized, significantly undercapitalized, or critically undercapitalized, or any executive officer or director of any such enterprise, if in the determination
of the Director the enterprise, executive officer, or director is engaging or has engaged, or the Director has reasonable cause to believe
that the enterprise, executive officer, or director is about to engage,
in—
(1) any conduct likely to result in a material depletion
of the core capital of the enterprise, or
(2) any conduct or violation described in paragraph (2)
or (3) of subsection (a),
except that the Director may not enforce compliance with any
housing goal established under subpart B of part 2 of subtitle
A of this title, with section 1336 or 1337 of this title, or with
subsection (m) or (n) of section 309 of the Federal National Mortgage
Association Charter Act or subsection (e) or (D of section 307 of
the Federal Home Loan Mortgage Corporation Act.
(c) PROCEDURE.—
(1) NOTICE OF CHARGES.—^Each

notice of charges under
this section shall contain a statement of the facts constituting
the alleged conduct or violation and shall fix a time and place
at which a hearing will be held to determine on the record
whether an order to cease and desist from such conduct or
violation should issue.
(2) ISSUANCE OF ORDER.—If the Director finds on the record
made at such hearing that any conduct or violation specified
in the notice of charges has been established (or the enterprise
consents pursuant to section 1373(aX4)), the Director may issue
and serve upon the enterprise, executive officer, or curector
an order requiring such party to cease and desist from any
such conduct or violation and to take affirmative action to
correct or remedy the (X>ndition8 resulting from any such conduct or violation.
(d) AFFIRMATIVE ACTION TO CORRECT CONDITIONS RESULTING
FROM VIOLATIONS OR ACTIVITIES.—The authority under this section

and section 1372 to issue any order requiring an enterprise, executive officer, or director to take affirmative action to correct or
remedy any condition resulting from anv conduct or violation with
respect to which such order is issued includes the authority—
(1) to require an executive officer or a director to make
restitution to, or provide reimbursement, indemnification, or
guarantee against loss to the enterprise to the extent that
such person—

106 STAT. 3988

PUBLIC LAW 102-550—OCT. 28, 1992

(A) was unjustly enriched in connection with such conduct or violation; or
(B) engaged in conduct or a violation that would subject
such person to a civil penalty piu'suant to section
1376(bX3);
(2) to require an enterprise to seek restitution, or to obtain
reimbursement, indemnification, or guarantee against loss;
(3) to restrict the growth of the enterprise;
(4) to require the enterprise to dispose of any asset
involved;
(5) to require the enterprise to rescind agreements or
contracts;
(6) to require the enterprise to employ qualified officers
or employees (who may be subject to approval by the Director
at the direction of the Director); and
(7) to require the enterprise to take such other action
as the Director determines appropriate.
(e) AUTHORITY TO LIMIT ACTIVITIES.—The authority to issue
an order under this section or section 1372 includes the authority
to place limitations on the activities or functions of the enterprise
or any executive officer or director of the enterprise.
(f) EFFECTIVE DATE.—An order imder this section shall become
effective upon the expiration of the 30-day period beginning on
the service of the order upon the enterprise, executive officer, or
director concerned (except in the case of an order issued upon
consent, which shall become effective at the time specified therein),
and shall remain effective and enforceable as provided in the order,
except to the extent that the order is stayed, modified, terminated,
or set aside by action of the Director or otherwise, as provided
in this subtitle.
12 u s e 4632.

SEC. 1372. TEMPORARY CEASE-AND-DESIST ORDERS.
(a) GROUNDS FOR ISSUANCE AND SCOPE.—Whenever

the Director
determines that any conduct or violation, or threatened conduct
or violation, specified in the notice of charges served upon the
enterprise, executive officer, or director pursuant to section 1371
(a) or (b), or the continuation thereof, is likely—
(1) to cause insolvency,
(2) to cause a signincant depletion of the core capital of
the enterprise, or
(3) otherwise to cause irreparable harm to the enterprise,
prior to the completion of the proceedings conducted pursuant to
section 1371(c), the Director may issue a temporary order requiring
the enterprise, executive officer, or director to cease and desist
from any such conduct or violation and to teke affirmative action
to prevent or remedy such insolvency, depletion, or harm pending
completion of such proceedings. Such order may include any requirement authorized under section 1371(d).
(b) EFFECTIVE DATE.—An order issued pursu£int to subsection
(a) shall become effective upon service upon the enterprise, executive officer, or director and, unless set aside, limited, or suspended
by a court in proceedings pursuant to subsection (d), shall remain
in effect and enforceable pending the completion of the proceedings
pursuant to such notice and shall remain effective imtil the Director
dismisses the charges specified in the notice or imtil superseded
by a cease-and-desist order issued pursuant to section 1371.
(c) INCOMPLETE OR INACCURATE RECORDS.—

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3989

(1) TEMPORARY ORDER.—If a notice of charges served under
section 1371 (a) or (b) specifies on the basis of particular facts
and circumstances that the books and records of the enterprise
served are so incomplete or inaccurate that the Director is
unable, through the normal supervisory process, to determine
the financial condition of the enterprise or the details or the
purpose of any transaction or transactions that may have a
material effect on the financial condition of that enterprise,
the Director may issue a temporary order requiring—
(A) the cessation of any activity or practice which gave
rise, whether in whole or in part, to the incomplete or
inaccurate state of the books or records; or
(B) affirmative action to restore the books or records
to a complete and accurate state.
(2) EFFECTIVE PERIOD.—^Any temporary order issued under
paragraph (1)—
(A) shall become effective upon service; and
(B) unless set aside, limited, or suspended by a court
in proceedings pursuant to subsection (d), shall remain
in effect and enforceable until the earlier of—
(i) the completion of the proceeding initiated under
section 1371 in connection with the notice of charges;
or
(ii) the dat€! the Director determines, by examination or otherwise, that the books and records of the
enterprise are accurate and reflect the financial condition of the enterprise.
(d) JUDICIAL R E V I E W . — ^ ^ enterprise, executive officer, or director that has been served with a temporary order pursuant to this
section may apply to the United States District Court for the
District of Columbia within 10 days after such service for an injunction setting aside, limiting, or suspending the enforcement, operation, or effectiveness of the order pending the completion of the
administrative proceedings pursuant to the notice of cnarges served
upon the enterprise, executive officer, or director under section
1371 (a) or (b). Such court shall have jurisdiction to issue such
injunction.
(e) ENFORCEMENT BY ATTORNEY GENERAL.—In the case of violation or threatened violation of, or failure to obey, a temporary
order issued pursuant to this section, the Director may request
the Attorney General of the United States to bring an action in
the United States District Court for the District of Columbia for
an injunction to enforce such order or may, under the direction
and control of the Attorney General, bring such an action. If the
court finds any such violation, threatened violation, or failure to
obey, the court shall issue such injunction.
SEC. 1373. HEARINGS.
(a) REQUIREMENTS.—
(1) VENUE AND RECORD.—^Any hearing imder section 1371

or 1376(c) shall be held on the record and in the District
of Columbia.
(2) TIMING.—^Any such hearing shall be fixed for a date
not earlier than 30 days nor later than 60 days after service
of the notice of charges under section 1371 or determination
to impose a penalty imder section 1376, unless an earlier or

12 USC 4633.

106 STAT. 3990

PUBLIC LAW 102-550—OCT. 28, 1992
a later date is set by the hearing officer at the request of
the partyserved.
(3) FROCEDURE.—^Any such hearing shall be conducted in
accordance with chapter 5 of title 5, United States Code.
(4) FAILURE TO APPEAR.—If the piuiy served fails to appear
at the hearing through a duly authorized representative, such
party shall be deemed to have consented to the issuance of
the cease-and-desist order or the imposition of the penalty
for which the hearing is held.
(b) ISSUANCE OF ORDER.—

(1) IN GENERAL.—After any such hearing, and within 90
days after the parties have been notified that the case has
been submitted to the Director for final decision, the Director
shall render the decision (which shall include findings of fact
upon which the decision is predicated) and shall issue and
serve upon each party to the proceeding an order or orders
consistent with the provisions of this subtiue.
(2) MODIFICATION.—Judicial review of any such order shall
be exclusively as provided in section 1374. Imless such a petition for review is timely filed as provided in section 1374,
and thereafter until the record in the proceeding has been
filed as so provided, the Director may at any time, modify,
terminate, or set aside an^ such order, upon such notice and
in such manner as the Director considers proper. Upon such
filing of the record, the Director may modify, termmate, or
set aside any such order with permission of the court.
12 u s e 4634.

SEC. 1874. JUDICIAL REVIEW.

(a) COMMENCEMENT.—Any party to a proceeding under section
1371 or 1376 ma^ obtain review of any final order issued under
such section hv filing in the United Stetes Court of Appeals for
the District of Columbia Circuit, within 30 dajrs after the date
of service of such order, a written petition praying that the order
of the Director be mo<fified, terminated, or set aside. The clerk
of the court shall transmit a copy of the petition to the Director.
(b) FILING OF RECORD.—^Upon receiving a copy of a petition,
the Director shall file in the court the record in the proceeding,
as provided in section 2112 of title 28, United Stetes Code.
(c) JURISDICTION.—^Upon the filing of a petition, such court
shall have jurisdiction, which upon the filing of the record by
the Director shall (except as provided in the last sentence of section
1373(bX2)) be exclusive, to affirm, modify, terminate, or set aside,
in whole or in part, the order of the Director.
(d) REVIEW.—^Review of such proceedings shall be governed
by chapter 7 of title 5, United Stetes Code.
(e) ORDER TO PAY PENALTY.—Such court shall have the authority in any such review to order payment of any penalty imposed
by the Director under this subtitle.
(f) No AUTOMATIC STAY.—^The commencement of proceedings
for judicial review under this section shall not, unless specifically
ordered by the court, operate as a stoy of any order issued by
the Director.
12 u s e 4635.

SEC. 1375. ENFORCEMENT AND JURISDICTION.

(a) ENFORCEMENT.—^The Director may request the Attorney
General of the United Stetes to bring an action in the United
States District Court for the District of Columbia for the enforcement of any efiective notice or order issued under this subtitle

PUBLIC LAW 102-550—OCT. 28,1992

106 STAT. 3991

or subtitle B or may, under the direction and control of the Attorney
General, bring suoi an aiction. Such court Bhall have jurisdiction
and power to order and require compliance herewith.
(b) LIMITATION ON JURISDICTION.—Except as otherwise provided
in this subtitle and sections 1369 and 1369D, no court shall have
jurisdiction to affect, by injunction or otherwise, the issuance or
enforcement of aiw notice or order under section 1371, 1372, or
1376, or subtitle B, or to review, modify, suspend, terminate, or
set aside any such notice or order.
SEC. 187«. CIVIL MONEY PENALTIE&

(a) IN GENERAL.—^The Director may impose a civil money penalty in accordance with this section on anv enterprise, or any
executive officer or director of any enterprise, that—
(1) violates any provision of this title, the Federal National
Mortgage Association Chuler Act, the Federal Home Loan
Mortgage Corporation Act, or any order, rule, or regulation
under any such title or Act, except that the Director may
not enforce compliance with any housing goal established under
subpart B of part 2 of subtiue A of this title, with section
1336 or 1337 of tins title, or with subsection (m) or (n) of
section 309 of the Federal National Mortgage Association Charter Act or subsection (e) or (f) of section 307 of the Federal
Home Loan Mortgage Corporation Act;
(2) violates any final or temporary order issued pursuant
to section 1365,1366, 1371, or 1372;
(3) violates any written agreement between the enterprise
and the Director; or
(4) engages in any conduct that causes or is likely to
cause a loss to the enterprise.
(b) AMOUNT OF PENALTY.—
(1) FIRST TIER.—^The Director

ma^ impose a penalty on
an enterprise for any violation described in paragraphs (1)
through (3) of subsection (a). The amount of a penalty imder
this paragrai^h shall not exceed $5,000 for each day that a
violation continues.
(2) SECOND TIER.—^The Director may impose a penalty on
an executive officer or director in an amount not to exceed
$10,000, or on an enterprise in an amount not to exceed
$25,000, for each da^ that a violation or conduct described
in subsection (a) contmues, if the Director finds that the violation or conduct—
(A) is part of a pattern of misconduct; or
(B) involved recklessness and caused or would be likely
to cause a material loss to the enterprise.
(3) THIRD TIER.—^The Director may impose a penalty on
an executive officer or director in an amount not to exceed
$100,000, or on am enterprise in an amount not to exceed
$1,000,000, for each day that a violation or conduct described
in subsection (a) continues, if the Director finds that the violation or conduct was knowing and caused or would be likely
to cause a substantial loss to the enterprise.
(c) PROCEDURES.—

(1) ESTABLISHMENT.—The Director shall establish standards and procedures governing the imposition of dvil money
penalties under subsections (a) and (b). Such standards and
procedures—

59-194 O—93

12 : QL 3 (Pt. 5)

12 USC 4636.

106 STAT. 3992

PUBLIC LAW 102-550—OCT. 28, 1992

(A) shfdl provide for the Director to notify the enterprise in writing of the Director's determination to impose
the penalty, which shall be made on the record;
(B) shall provide for the imposition of a penalty only
after the enterprise, executive officer, or director has been
given an opportunity for a hearing on the record pursuant
to section 1373; and
(C) may provide for review by the Director of any
determination or order, or interlocutory ruling, arising from
a hearing.
(2) FAcrroRS IN DETERMINING AMOUNT OF PENALTY.—In
determining the amount of a penalty under this section, the
Director shall give consideration to such factors as the gravity
of the violation, any history of prior violations, the effect of
the penalty on the safety and soundness of the enterprise,
any ii^jury to the public, any benefits received, and deterrence
of future violations, and any other factors the Director may
determine by regulation to be appropriate.
(3) REVIEW OF IMPOSITION OF PENALTY.—The order of the
Director imposing a penalty under this section shall not be
subject to review, except as provided in section 1374.
(d) ACTION To COLLECT PENALTY.—If an enterprise, executive
officer, or director fails to comply with an order of the Director
imposing a civil money penalty under this section, after the order
is no longer subject to review as provided under subsection (cXl)
and section 1374, the Director may request the Attorney General
of the United States to bring an action in the United States District
Court for the District of Columbia to obtain a monetary judgment
against the enterprise, executive officer, or director and such other
relief as may be available, or may, under the direction and control
of the Attorney General, bring such an action. The monetary judgment may, in the discretion of the court, include any attorneys
fees and other expenses incurred by the United States in connection
with the action. In an action under this subsection, the validity
and appropriateness of the order of the Director imposing the penalty shall not be subject to review.
(e) SETTLEMENT BY DIRECTOR.—^The Director may compromise,
modify, or remit any civil money penalty which may be, or hcus
been, imposed under this section.
(0 AVAILABILITY OF OTHER REMEDIES.—Any civil money penalty
under this section shall be in addition to any other available civil
remedy and may be imposed whether or not the Director imposes
other administrative sanctions.
(g) PROHIBITION OF REIMBURSEMENT OR INDEMNIFICATION.—

An enterprise may not reimburse or indemnify any individual for
any penalty imposed under subsection (bX3).
(h) DEPOSIT OF PENALTIES.—The Director shall deposit any
civil money penalties collected under this section into the general
fund of the Treasury.
(i) APPLICABILITY.—^A ^nalty under this section may be
imposed only for conduct or violations under subsection (a) occurring
after the date of tiie enactment of this Act.
12 u s e 4637.

SEC. 1377. NOTICE AFTER SEPARATION FROM SERVICE.

The resignation, termination of employment or participation,
or separation of a director or executive officer of an enterprise
shall not affect the jurisdiction and authority of the Director to

PUBLIC LAW 102-550—OCT. 28,1992

106 STAT. 3993

issue any notice and proceed under this subtitle against any such
director or executive officer, if such notice is served before the
end of the 2-year periocl beginning on the date such director or
executive officer ceases to be associated with the enterprise.
SEC. 1378. PBIVATE RIGHTS OF ACTION.

12 USC 4638.

This title and the amendments made by this title shall not
create any private right of action on behalf of any person against
an enterprise, or any director or executive officer of an enterprise,
or impfidr any existing private right of action under other apphcable
law.
SEC. 1379. PUBUC DISCIX>SURE OF FINAL ORDERS AND AGREE- 12 USC 4639.
MENTS.

(a) IN GENERAL.—^The Director shall make available to the
public—
(1) any written agreement or other written statement for
which a violation may be redressed bv the Director or any
modification to or termination thereof, unless the Director,
in the Director's discretion, determines that public disclosure
would be contrary to the public interest;
(2) any order that is issued with respect to any administrative enforcement proceeding initiated by the Director under
this subtitle and that has become final in accordance with
sections 1373 and 1374; and
(3) any modification to or termination of any final order
made public pursuant to this subsection.
(b) HEARINGS.—^All hearings on the record with respect to any
notice of charges issued bv the Director shall be open to Uie public,
unless the Director, in the Director's discretion, determines that
holding an open hearing would be contrary to the public interest.
(c) DELAY OF PUBUC DISCLOSURE UNDER EXCEPTIONAL CIR-

CUMSTANCES.—If the Director makes a determination in writing
that the public disclosure of any final order pursuant to subsection
(a) would seriously threaten the financial health or security of
the enterprise, the Director may delay the public disclosure of
such order for a reasonable time.
(d) DOCUMENTS FILED UNDER SEAL IN PUBUC ENFORCEMENT

HEARINGS.—^The Director may file any document or part thereof
under seal in any hearing commenced by the Director if the Director
determines in writing mat disclosure thereof would be contrary
to the public interest.
(e) RETENTION OF DOCUMENTS.—The Director shall keep and Records.
maintain a record, for not less than 6 years, of all documents
described in subsection (a) and all enforcement agreements and
other supervisory actions and supporting documents issued with
respect to or in connection with any enforcement proceeding initiated by the Director under this subtitle or any other law.
(0 DISCLOSURES TO CONGRESS.—This section mav not be construed to authorize the withholding, or to prohibit the disclosure,
of any information to the Congress or any committee or subcommittee thereof.
SEC. 1379A. NOTICE OF SERVICE.

Any service required or authorized to be made by the Director
under this subtitle may be made by registered mail, or in such
other manner reasonably calculated to give actual notice as the
Director may by regulation or otherwise provide.

12 USC 4640.

106 STAT. 3994
12 u s e 4641.

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 1S79B. SUBPOENA AUTHORITY.

(a) IN GENERAL.—In the course of or in connection with anv
administrative proceeding under this subtitle, the Director shall
have the authority—
(1) to administer oaths and affirmations;
(2) to take and preserve testimony under oath;
(3) to issue subpoenas and subpoenas duces tecum; and
(4) to revoke, quash, or modify subpoenas and subpoenas
duces tecum issued by the Director.
(b) WITNESSES AND DOCUMENTS.—^The attendance of witnesses
and the production of documents provided for in this section may
be required from any place in any State at any designated place
where such proceeding is being conducted.
(c) ENFORCEMENT.—^The Director may request the Attorney
General of the United States to bring an action in the United
States district court for the judicial district in which such proceeding
is being conducted, or where the witness resides or conducts business, or the United States District Court for the District of Columbia, for enforcement of any subpoena or subpoena duces tecum
issued pursuant to this section or may, under the direction and
control of the Attorney General, bring such an action. Such courts
shall have jurisdiction and power to order and require compUance
therewith.
(d) FEES AND EXPENSES.—^Witnesses subpoenaed under this
section shall be paid the same fees and mileage that are paid
witnesses in the district courts of the United States. Any court
having jurisdiction of any proceeding instituted under this section
by an enterprise may allow to any such party such reasonable
expenses and attorneys fees as the court deems just and proper.
Such expenses and fees shall be paid by the enterprise or from
its assets.

Subtitle D—^Amendments to Charter Acts
of Enterprises
SEC. 1381. A M E N D M E N T S TO FEDERAL
ASSOCLiTION CHARTER ACT.

NATIONAL MORTGAGE

(a) PURPOSES.—Section 301 of the Federal National Mortgage
Association Charter Act (12 U.S.C. 1716) is amended—
(1) by striking 'iiome" each place it appears and inserting
'^sidential";
(2) in paragraph (3)—
(A) by striking the parentheses and all the matter
contained therein and inserting the following: ''(including
activities relating to mor^ages on housing for low- ana
moderate-income families involving a reasonable economic
return that may be less than the return earned on other
activities)"; and
(B) by striking "and" at the end;
(3) by redesignating paragraph (4) as paragraph (5);
(4) by insertmg after paragraph (3) the foflowing new paragraph:
"(4) promote access to mortgage credit throughout the
Nation (including central cities, rural areas, and underserved
areas) by increasmg the Uquidity of mortgage investments and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3995

improving the distribution of investment capital available for
residential mortgage financing; and".
(b) HIGH COST AMJAS.—The last sentence of section 302(bX2)
of the Federal National Mortgage Association Charter Act (12 U.S.C.
1717(bX2)) is amended by striking "and Hawaii" and inserting
"Hawaii, and the Virgin Islands".
(c) SECRETARY'S APPROVAL AUTHORITY.—Section 302(b) of the
Federal National Mortgage Association Charter Act (12 U.S.C.
1717(bX2)) is amended—
(1) in the first sentence of paragraph (2), by striking "and
with the approval of the Secretary of Housing and Urban Development,";
(2) in the first sentence of paragraph (3), Inr striking ",
with the approval of the Secretary of Housing and Urban Development,";
(3) in the first sentence of paragraph (4), bv striking ",
with the approval of the Secretary of Housing and Urban Development,"; and
(4) by adding at the end the following new paragraph:
"(6) The corporation may not implement any new program
(as such term is defined in section 1303 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992) before
obtaining the approval of the Secretary under section 1322 of such
Act.".
(d) CAPITALIZATION.—Section 303 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1718) is amended—
(1) in subsection (a), by inserting after the period at the
end the following new sentence: T h e corporation may issue
shares of common stock in return for appropriate payments
into capital or capital and surplus.";
(2) by striking subsections (b) and (c) and inserting the
following new subsections:
"(bXl) The corporation may impose charges or fees, which may
be regarded as elements of pricing, with the objective that all
costs and expenses of the operations of the corporation should
be within its income derived from such operations and that such
operations should be fully self-supporting.
"(2) All earnings from the operations of the corporation shall
annually be transferred to the general surplus account of the corporation. At any time, funds of the general surplus account may,
in the discretion of the board of directors, be transferred to reserves.
"(cXD Except as provided in paragraph (2), the corporation
may make such capital distributions (as such term is defined in
section 1303 of the Federal Housing Enterprises Financial Safety
and Soundness Act of 1992) as may be declared by the board
of directors. All capital distributions shall be charged against the
general surplus account of the corporation.
"(2) The corporation may not make any capital distribution
that would decrease the total capital of the corporation (as such
term is defined in section 1303 of the Federal Housing Enterprises
Financial Safety and Soundness Act of 1992) to an amount less
than the risk-based capital level for the corporation established
imder section 1361 of such Act or that would decrease the core
capital of the corporation (as such term is defined in section 1303
of such Act) to an amoiuit less than the minimum capital level
for the corporation established under section 1362 of such Act,
without prior written approval of the distribution by the Director

106 STAT. 3996

PUBLIC LAW 102-550—OCT. 28, 1992

of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development.";
(3) in subsection (0—
(A) 1^ striking 'i» make payments" and all that follows
through such capital contributions,"; and
(B) by striking "additional shares of such stodc," and
inserting "shares of common stock of the corporation"; and
(4) bv redesignating subsection (f) (as so amended) as subsection (d).
(e) RATIO OF OBUGATIONS.—Section 304 of the Federal National
Mortgage Association Charter Act (12 U.S.C. 1719) is amended—
(1) in subsection (b), by striking the semicolon in the first
sentence and all that follows through the end of the second
sentence and inserting a period; and
(2) in subsection (e), by striking the fourth sentence.
(f) STATEMENT IN SECURITIES.—Section 304(d) of the Federal
National Mortgage Association Charter Act (12 U.S.C. 1719(d))
is amended by inserting after the period at the end the following
new sentence: The corporation shall insert appropriate language
in all of the securities issued under this subsection clearly indicating
that such securities, together with the interest thereon, are not
guaranteed by the United States and do not constitute a debt
or obligation of the United States or any agency or instrumentality
thereof other than the corporation.".
(g) ASSESSMENTS FOR OFFICE OF FEDERAL HOUSING ENTERPRISE

OVERSIGHT.—The first sentence of section 304(f) of the Federal
National Mortgage Association Charter Act (12 U.S.C. 1719(f)) is
amended by inserting before the first comma the following: "of
this Act and assessments pursuant to section 1316 of the Federal
Housing Enterprises Financial Safety and Soundness Act of 1992".
(h) BOARD OF DIRECTORS.—

12USC1723
"°^-

(1) IN GENERAL.—The second sentence of section 308(b)
of the Federal National Mortgage Association Charter Act (12
U.S.C. 1723(b)) is amended—
(A) by striking "and" after the second comma; and
(B) by inserting before the period at the end the following: ", and at least one person from an organization that
hi^ represented consumer or community interests for not
less than 2 years or one person who nas demonstrated
a career commitment to the provision of housing for lowincome households".
(2) IMPLEMENTATION.—The amendments made by paranraph (1) shall apply to the first annual appointment by the
President of members to the board of directors of the Federal
National Mortgage Association that occurs aRer the date of
the enactment of this Act.
(i) REMOVAL AUTHORITY OF PRESIDENT.—The third sentence
of section 308(b) of the Federal National Mortgage Association
Charter Act (12 U.S.C. 1723(b)) is amended by inserting "appointed"
after "any such".
(j) COMPENSATION.—Section 309(d) of the Federal National
Mortgage Association Charter Act (12 U.S.C. 1723a(d)) is
amend^—
(1) in the first sentence of paragraph (2) by striking "as
it may determine" and inserting the foUowing: "as the board
of directors determines reasonable and comparable with compensation for employment in other similar businesses (including

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3997

other publicly held financial institutions or mcgor financial
services companies) involving similar duties and responsibilities, except that a signiificant portion of potential compensation
of all executive officers (as such term is defined in paragraph
(3XC)) of the corporation shall be based on the performance
of the corporation ; and
(2) by adding at the end the following new paragraph:
"(3XA) Not later than Jime 30, 1993, and annually thereafter. Reports.
the corporation shall submit a report to the Committee on Banking,
Finance and Urban Affairs of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of the
Senate on (i) the comparability of the compensation policies of
the corporation with the compensation policies of other similar
businesses, (ii) in the aggregate, the percentage of total cash compensation and payments under employee benefit plans (which shall
be defined in a manner consistent with the corporation's proxy
statement for the annual meeting of shareholders for the preceding
year) earned by executive officers of the corporation during the
preceding year that was based on the corporation's performance,
and (iii) the comparability of the corporation s financial performance
with the performance of other similar businesses. The report shall
include a copy of the corporation's proxy statement for the annual
meeting of shareholders for the preceding year.
''(B) Notwithstanding the first sentence of paragraph (2), after
the date of the enactment of the Federal Housing Enterprises
Financial Safety and Soimdness Act of 1992, the corporation may
not enter into any agreement or contract to provide any payment
of money or other thing of current or potential value in connection
with the termination of employment of any executive officer of
the corporation, unless such agreement or contract is approved
in advance by the Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development. The Director may not approve any such agreement or contract
imless the Director determines that the benefits provided imder
the agreement or contract are comparable to benefits under such
agreements for officers of other public and private entities involved
in financial services and housing interests who have comparable
duties and responsibilities,. For purposes of this subparagraph, any
renegotiation, amendment, or change after such date of enactment
to any such agreement or contract entered into on or before such
date of enactment shall be considered entering into an agreement
or contract.
"(C) For purposes of this paragraph, the term 'executive officer'
has the meaning given the term in section 1303 of the Federal
Housing Enterprises Financial Safety and Soundness Act of 1992.".
(k) GENERAL REGULATORY AUTHORITY.—Section 309 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a)
is amended by striking subsections (h) and (i).
(1) GAO AUDITS.—Section 309<j) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a(j)) is amended—
(1) by inserting "(1)" after "(j)";
(2) by striking the first sentence and inserting the following
new sentence: T h e programs, activities, receipts, expenditures,
and financial transactions of the corporation shall be subject
to audit by the Comptroller General or the United Stetes under
such rules and regulations as may be prescribed by the
Comptroller Greneral."; and

106 STAT. 3998

PUBLIC LAW 102-550—OCT. 28, 1992

(3) by adding at the end the following new paragraph:
"(2) To cany out this subsection, the representatives of the
General Accounting Office shall have access, upon request to the
corporation or any auditor for an audit of the corporation under
subsection (1), to any books, accounts, financial records, reports,
files, or other papers, things, or property belonging to or in use
by the coiporation and used in any such audit and to any papers,
records, files, and reports of the auditor used in such an audit.",
(m) FINANCIAL REPORTS TO DIRECTOR.—Section 309 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a)
is amended by adding at the end ihe following new subsection:
"(kXD The corporation shall submit to the Director of the
Office of Federal Housing Enterprise Oversight of the Department
of Housing and Urban Development annual and quarterly reports
of the financial condition and operations of the corporation which
shall be in such form, contain such information, and be submitted
on such dates as the Director shall require.
"(2) Each such annual report shall include—
"(A) financial statements prepared in accordance with generally accepted accounting principles;
"(B) any supplemental information or alternative presentation that Uie Director may require; and
"(C) an assessment (as of the end of the corporation's
most recent fiscal year), signed by the chief executive officer
and chief accounting or financial officer of the corporation,
of—
"(i) the effectiveness of the internal control structure
and procedures of the corporation; and
"(ii) the compliance of the corporation with designated
safety and soundness laws.
"(3) The corporation shall also submit to the Director any
other reports required by the Director pursuant to section 1314
of the Federal Housing Enterprises Financial Safety and Soundness
, Act of 1992.
"(4) Each report of financial condition shall contain a declaration by the president, vice president, treasurer, or any other officer
designated by the board of directors of the corporation to make
such declaration, that the report is true and correct to the best
of such officer's knowledge and belief.".
(n) AUDITS OF FINANCIAL STATEMENTS.—Section 309 of

\

the

Federal National Mortgage Association Charter Act (12 U.S.C.
1723a) is amended by adding after subsection (k) (as added by
subsection (m) of this section) the following new subsection:
"(1X1) The corporation shall have an annual independent audit
made of its financial statements by an independent public accountant in accordance with generally accepted auditing standards.
"(2) In conducting an audit under this subsection, the independent public accountant shall determine and report on whether the
financial statements of the corporation (A) are presented fairly
in accordance with generally accepted accounting principles, and
(B) to the extent determined necessapr by the Director, comply
with any disclosure requirements imposed under subsection
(kX2XB).*
(o) MORTGAGE DATA COLLECTION AND REPORTING REQUIRE-

MENTS.—Section 309 of the Federal National Mortgage Association
Charter Act (12 U.S.C. 1723a) is amended by adding after sub-

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 3999

section (1) (as added by subsection (n) of this section) the following
new subsection:
''(mXl) The corporation shall collect, maintain, and provide
to the Secretary, in a form determined by the Secretaiy, data
relating to its mortgages on housing consisting of 1 to 4 dwelling
imits. Such data shall mclude—
"(A) the income, census tract location, race, and gender
of mortgagors under such mortgages;
"(B) the loan-to-value ratios of pvirchased mortgages at
the time of origination;
"(C) whemer a particular mortgage purchased is newly
originated or seasoned;
"(D) the number of units in the housing subject to the
mortgage and whether the units are owner-occupied; and
"(E) any other characteristics that the Secretary considers
appropriate, to the extent practicable.
"(2) The corporation shall collect, maintain, and provide to
the Secretary, in a form determined by the Secretary, data relating
to its mortgages on housing consisting of more than 4 dwelling
units. Such data shall include—
"(A) census tract location of the housing;
"(B) income levels and characteristics of tenants of the
housing (to the extent practicable);
"(C) rent levels for units in the housing;
"(D) mortgage characteristics (such as the niunber of units
financed per mortgage and the amount of loans);
**(£) mortgagor characteristics (such as nonprofit, for-profit,
limited equity cooperatives);
"(F) vise of funds (such as new construction, rehabilitation,
refinancing);
"(G) type of originating institution; and
"(H) any other information that the Secretary considers
appropriate, to the extent practicable.
"(SKA) Except as pro>ddea in subparagraph (B), this subsection
shall apply only to mortgages purchased by the corporation after
December 31,1992.
"(B) This subsection shall apply to any mortgage purchased
bv the corporation after the date determined under subparagraph
(A) if the mortgage was originated before such date, but only to
the extent that the data referred in paragraph (1) or (2), as
applicable, is available to the corporation. .
(p) REPORT ON HOUSING ACTIVITIES.—Section 309 of the Federal

National Mortgage Association Charter Act (12 U.S.C. 1723a) is
amended by addmg after subsection (m) (as added by subsection
(o) of this section) the following new subsection:
"(nXD The corporation shall submit to the Committee on Banking, Finance and Urban Affairs of the House of Representatives,
the Committee on Banliing, Housing, and Urban Affairs of the
Senate, and the Secretaiy a report on its activities under subpart
B of part 2 of subtitle A of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992.
"(2) The report under this subsection shall—
"(A) include, in aggregate form and by appropriate category,
statements of the dollar volume and number of mortgages
on owner-occupied and rental properties purchased which relate
to each of the annual housing goals established under such
subpart;

106 STAT. 4000

Public
information.

PUBLIC LAW 102-550—OCT. 28, 1992

''(B) include, in aggregate form and by appropriate category,
statements of the nuniber of families served by the corporation,
the income class, race, and gender of homebuyers served, the
income class of tenants of rental housing (to the extent such
information is available), the characteristics of the census
tracts, and the geographic distribution of the housing financed;
"(C) include a statement of the extent to which the mortgages purchased by the corporation have been used in conjunction with public subsidy programs under Federal law;
"(D) include statements of the proportion of mortgages
on housing consisting of 1 to 4 dwelling units purchased by
the corporation that have been made to first-time homebuyers,
as soon as providing such data is practicable, and identifying
any special programs (or revisions to conventional practices)
facilitating homeownership opportimities for first-time homebuyers;
"(E) include, in aggregate form and by appropriate category,
the data provided to the Secretary under subsection (m)(l)(B);
"(F) compare the level of securitization versus portfolio
activity;
"(G) assess underwriting standards, business practices,
repurchase requirements, pricing, fees, and procedures, that
affect the purchase of mortgages for low- and moderate-income
families, or that may yield disparate results based on the
race of the borrower, including revisions thereto to promote
affordable housing or fair lending;
"(H) describe trends in both the primary and secondary
multifamily housing mortgage markets, including a description
of the progress made, and any factors impeding progress toward
standardization and securitization of mortgage products for
multifamily housing;
"(I) describe trends in the delinquency and default rates
of mortgages secured by housing for low- and moderate-income
families that have been purchased by the corporation, including
a comparison of such trends with delinquency and default
information for mortgage products serving households with
incomes above the median level that have been purchased
by the corporation, and evaluate the impact of such trends
on the standards and levels of risk of mortgage products serving
low- and moderate-income families;
"(J) describe in the aggregate the seller and servicer network of the corporation, including the volume of mortgages
purchased from minority-owned, women-owned, and community-oriented lenders, and any efforts to facilitate relationships
with such lenders;
"(K) describe the activities undertaken by the corporation
with nonprofit and for-profit organizations and with State and
local governments and housing finance agencies, including how
the corporation's activities support the objectives of comprehensive housing affordability strategies under section 105 of the
Cranston-Gonzalez National Affordable Housing Act; and
"(L) include any other information that the Secretary
considers appropriate.
"(3)(A) The corporation shall make each report under this subsection available to the public at the principal and regional offices
of the corporation.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 4001

"(B) Before making a report under this subsection available
to the public, the corporation may exclude from the report information that the Secretary has determined is proprietaiy information
under section 1326 of the Federal Housing Enterprises Financial
Safety and Soundness Act of 1992.".
(q) HOUSING ADVISORY COUNCIL.—Section 309 of the Federal

National Mortgage Association Charter Act (12 U.S.C. 1723a) is
amended by adcQng after subsection (n) (as added by subsection
(p) of this section) the following new subsection:
"(oXl) Not later than 4 months after the date of enactment
of the Federal Housing Enterprises Financial Safety and Soundness
Act of 1992, the corporation shall appoint an Affordable Housing
Advisory Council to advise the corporation regarding possible methods for promoting affordable hoiising for low- and moderate-income
families.
"(2) The Affordable Housing Advisory Council shall consist of
15 individuals, who shall include representatives of communitybased and other nonprofit and for-profit organizations and State
and local government agencies actively engaged in the promotion,
development, or financing of housing for low- and moderate-income
families.".
(r) STOCK ISSUANCES.—^The second sentence of section 311 of
the Federal National Mortgage Association Charter Act (12 U.S.C.
1723c) is amended by striking all that follows "Commission" and
inserting a period.
(s) TECHNICAL AMENDMENTS.—

(1) Section 302(c) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1717(c)) is amended—
(A) in paragraph (2)—
(i) in the first sentence following subparagraph
(F), by striking "him" and inserting "the trustor"; and
(ii) in the last sentence, by striking "his" each
place it appears and inserting "the trustor's"; and
(B) in paragraph (3), by striking l i e " each place it
appears and inserting "the trustor".
(2) Section 304(c) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1719(c)) is amended—
(A) by striking "his" each place it appears and inserting
"the Secretary's"; and
(B) in the fourth sentence—
(i) by striking "he" and inserting "the Secretary";
and
(ii) by striking "him" and inserting "the Secretarjr".
(3) Section 309 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a) is amended—
(A) in subsection (dX2)—
(i) in the third sentence, by striking "his employment" each place it appears and inserting "the employment of such officer or employee"; and
(ii) in the last sentence, by striking "his basic
pay" and inserting "the basic pay of such person";
and
(B) in subsection (e), by striking "he or it" and inserting
"the individual, association, partnership, or corporation".

106 STAT. 4002

PUBLIC LAW 102-550—OCT. 28, 1992

SEC. 1382. AMENDMENTS TO FEDERAL HOME LOAN MORTGAGE CORPORATION ACT.

(a) PURPOSES.—Section 301(b) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1451 note) is amended—
(1) by striking ''home" each place it appears in paragraphs
(1) and (3) and inserting "residential";
(2) by striking "anar at the end of paragraph (2);
(3) in paragraph (3)—
(A) by striking the parentheses and all the matter
contained therein and inserting the following: "(including
activities relating to mortgages on housing for low- and
moderate-income families involving a reasonable economic
return that may be less than the return earned on other
activities)**; and
(B) by striking the period at the end and inserting
"; and**; and
(4) by adding at the end the following new paragraph:
"(4) to promote access to mortgage credit throughout the
Nation (including central cities, rural areas, and underserved
areas) by increasing the liquidity of mortgage investments and
improving the distribution of investment capitol available for
residential mortgage financing.*'.
(b) DEFINITIONS.—The third sentence of section 302(h) of the
Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1451(h))
is amended b^ striking "made** and all that follows through
"305(a)(1)'* and inserting "purchased from any public utility canying
out activities in accordance with the requirements of title II of
the National Energy Conservation Policy Act if the residential mortgage to be purchased is a loan or advance of credit the original
proceeds of which are applied for in order to finance the purchase
and installation of residential energy conservation measures (as
defined in section 210(11) of the National Energy Conservation
Policy Act) in residential real estate**.
(c) BOARD OF DIRECTORS.—

12 use 1452
note,

(1) I N GENERAL.—^The second sentence of section
303(a)(2)(A) of the Federal Home Loan Mortgage Corporation
Act (12 U.S.C. 1452(a)(2XA)) is amended—
(A) by striking "and** after the second comma; and
(B) by inserting before the period at the end the following: ", and at least 1 person from an organization that
has represented consumer or commimity interests for not
less than 2 years or 1 person who has demonstrated a
career commitment to the provision of housing for lowincome households**.
(2) IMPLEMENTATION.—^The amendments made by paragraph (1) shall apply to the first annual appointment by the
President of members to the Board of Directors of the Federal
Home Lo£in Mortgage Corporation that occurs £ifter the date
of the enactment of this Act.
(d) REMOVAL AUTHORITY O F PRESIDENT.—Section 303(aX2XB)
of the Federal Home Loan Mortgage Corporation Act (12 U.S.C.
1452(aX2)(B)) is amended by inserting before the period at the
end the following: ", except that any appointed member may be
removed from office by the President for good cause".
(e) GENERAL REGULATORY AUTHORITY.—Section 303(b) of the
Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1452(b))
is amended to read as follows:

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 4003

"(b)(1) Except as provided in paragraph (2), the Corporation
may make such capital distributions (as such term is defined in
section 1303 of the Federal Housing Enterprises Financial Safety
and Soundness Act of 1992) as may be declared by the Board
of Directors.
"(2) The Corporation may not make any capital distribution
that would decrease the total capital of the Corporation (as such
term is defined in section 1303 oi the Federal Housing Enterprises
Financial Safety and Soundness Act of 1992) to an amount less
than the risk-based capital level for the Corporation established
imder section 1361 of such Act or that would decrease the core
capital of the Corporation (as such term is defined in section 1303
of such Act) to an amount less than the minimum capital level
for the Corporation established under section 1362 of such Act,
without prior written approval of the distribution by the Director
of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development.".
(f) COMPENSATION.—Section 303 of the Federal Home Loan
Mortgage Corporation Act (12 U.S.C. 1452) is amended—
(1) in clause (9) of the first sentence of subsection (c),
by inserting after "agents" the following: "as the Board of
Directors determines reasonable and comparable with compensation for employment in other similar businesses (including
publicly held financial institutions or other major financial
services companies) involving similar duties and responsibilities, except that a significant portion of potential compensation
of all executive officers (as such term is defined in subsection
(h)(3)) of the Corporation shall be based on the performance
of the Corporation ; and
(2) by adding at the end the following new subsection:
"(h)(1) Not later than June 30, 1993, and annually thereafter. Reports.
the Corporation shall submit a report to the Committee on Banking,
Finance and Urban Affairs of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of the
Senate on (A) the comparability of the compensation policies of
the Corporation with the compensation policies of other similar
businesses, (B) in the aggregate, the percentage of total cash compensation and payments under employee benefit plans (which shall
be defined in a manner consistent with the Corporation's proxy
statement for the annual meeting of shareholders for the preceding
year) earned by executive officers of the Corporation during the
preceding year that was based on the Corporation's performance,
and (C) the comparability of the Corporation's financial performance
with the performance of other similar businesses. The report shall
include a copy of the Corporation's proxy statement for the annual
meeting of shareholders for the preceding year.
"(2) Notwithstanding the first sentence of subsection (c), after
the date of the enactment of the Federal Housing Enterprises
Financial Safety and Soundness Act of 1992, the Corporation may
not enter into any agreement or contract to provide any payment
of money or other thing of current or potential value in connection
with the termination of employment of any executive officer of
the Corporation, imless such agreement or contract is approved
in advance by the Director of the OfiRce of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development. The Director may not approve any such agreement or contract
unless the Director determines that the benefits provided under

106 STAT. 4004

PUBLIC LAW 102-550—OCT. 28, 1992

the agreement or contract are comparable to benefits under such
agreements for officers of other public and private entities involved
in financial services and housing interests who have comparable
duties and responsibilities. For purposes of this paragraph, any
renegotiation, amendment, or chaJnge after sudi date of enactment
to any such agreement or contract entered into on or before such
date of enactment shall be considered entering into an agreement
or contract.
"(3) For purposes of this subsection, the term 'executive officer*
has the meaning given the term in section 1303 of the Federal
Housing Enterprises Financial Safety and Soundness Act of 1992.".
(g) POWERS OF CORPORATION.—Section 303(c) of the Federal
Home Loan Mortgage Corporation Act (12 U.S.C. 1452(c)) is
amended by striking the second sentence.
(h) REPEAL OF PROHIBITION ON PREJUDGMENT ATTACHMENT.—

Section 303(f) of the Federal Home Loan Mortgage Corporation
Act (12 U.S.C!. 1452(f)) is amended by striking the last sentence.
(i) CAPITAL STOCK.—Section 304 of the Federal Home Loan
Mortgage Corporation Act (12 U.S.C. 1453) is amended—
(1) by striking subsections (b), (c), and (d);
(2) in subsection (aXD, by striking "(1) The common stock"
and all that follows and inserting the following: T h e common
stock of the Corporation shall consist of voting common stock,
which shall be issued to such holders in the manner and
amount, and subject to any limitations on concentration of
ownership, as may be established by the Corporation."; and
(3) in subsection (aX2)—
(A) in the first sentence, by striking "nonvoting common stock and the";
(B) by striking the last sentence; and
(C) by striking the paragraph designation and inserting
"(b)".
(j) MORTGAGE SELLERS.—Section 305(aXl) of the Federal Home
Loan Mortgage Corporation Act (12 U.S.C. 1454(aXl)) is amended—
(1) in the first sentence, by striking "from any Federal
home loan bank" and all that follows through the end of the
sentence and inserting a period; and
(2) in the second sentence, by striking ", and the servicing"
and all that follows through the end of the sentence and inserting a period.
(k) HIGH COST AREAS.—The last sentence of section 305(aX2)
of the Federal Home Loan Mortgage Corporation Act (12 U.S.C.
1454(aX2)) is amended by striking "and Hawaii" and inserting
"Hawaii, and the Virgin Islands".
(1) REPEAL OF PROHIBITION ON MORTGAGE LIMITATIONS.—Sec-

tion 305 of the Federal Home Loan Mortgage Corporation Act
(12 U.S.C. 1454) is amended by striking subsection (c).
(m) PRIOR APPROVAL OF SECRETARY FOR NEW PROGRAMS.—

Section 305 of the Federal Home Loan Mortgage Corporation Act
(12 U.S.C. 1454) is amended by inserting after subsection (b) the
following new subsection:
"(c) The Corporation may not implement any new program
(as such term is defined in section 1303 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992) before
obtaining the approval of the Secretary imder section 1322 of such
Act.".

PUBLIC LAW 102-550—OCT. 28, 1992
(n)

OBLIGATIONS

AND

SECURITIES

AND

ASSESSMENTS

106 STAT. 4005
FOR

OFFICE.—Section 306 of the Federal Home Loan Mortgage Corporation (12 U.S.C.1455) is amended—
(1) in subsection (h)—
(A) by inserting " ( i r after "(h)"; and
(B) by adding at the end the following new paragraph:
"(2) The Corporation shall insert appropriate language in all
of the obligations and securities of the Corporation issued under
this section and section 305 clearly indicating that such obligations
and securities, together with the interest thereon, are not guaranteed by the United States and do not constitute a debt or obligation
of the United States or any agency or instrumentality thereof other
than the Corporation."; and
(2) in the first sentence of subsection (i), by striking "section
303(c) or 306(c)" and inserting the following: "sections 303(c)
and 1316(c) of this Act and assessments pursuant to section
106 of the Federal Housing Enterprises Financial Safety and
Soundness Act of 1992".
(o) GAO AUDITS.—Section 307(b) of the Federal Home Loan
Mortgage Corporation Act (12 U.S.C. 1456(b)) is amended—
(1) by inserting "(1)" after "(b)";
(2) by striking the first sentence and inserting the following
new sentence: "The programs, activities, receipts, expenditures,
and financial transactions of the Corporation shall be subject
to audit by the Comptroller General of the United States under
such rules and regulations as may be prescribed by the
Comptroller General."; and
(3) by adding at the end the following new paragraph:
"(2) To carry out this subsection, the representatives of the
General Accounting Office shall have access, upon request to the
Corporation or any auditor for an audit of the Corporation under
subsection (d), to any books, accounts, financial records, reports,
files, or other papers, things, or property belonging to or in use
by the Corporation and used in any such audit and to any papers,
records, files, and reports of the auditor used in such an audit.",
(p) FINANCIAL REPORTS TO DIRECTOR.—Section 307 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1456) is
amended by adding at the end the following new subsection:
"(c)(1) The Corporation shall submit to the Director of the
Office of Federal Housing Enterprise Oversight of the Department
of Housing and Urban Development annual and quarterly reports
of the financial condition and operations of the Corporation which
shall be in such form, contain such information, and be submitted
on such dates as the Director shall require.
"(2) Each such annual report shall include—
"(A) financial statements prepared in accordance with generally accepted accounting principles;
"(B) any supplemental information or alternative presentation that the Director may require; and
"(C) an assessment (as of the end of the Corporation's
most recent fiscal year), signed by the chief executive officer
and chief accounting or financial officer of the Corporation,
of—
"(i) the effectiveness of the internal control structure
and procedures of the Corporation; and
"(ii) the compliance of the Corporation with designated
safety and soundness laws.

106 STAT. 4006

PUBLIC LAW 102-550—OCT. 28, 1992

"(3) The Corporation shall also submit to the Director any
other reports required by the Director pursuant to section 1314
of the Federal Housing Enterprises Financial Safety and Soundness
Act of 1992.
"(4) Each report of financial condition shall contain a declaration by the president, vice president, treasurer, or any other officer
designated by the Board of Directors of the Corporation to make
such declaration, that the report is true and correct to the best
of such officer's knowledge and belief.".
(q) AUDITS OF FINANCIAL STATEMENTS.—Section 307 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1456) is
amended by adding after subsection (c) (as added by subsection
(p) of this section) the following new subsection:
"(dXD The Corporation shall have an annual independent audit
made of its financial statements by an independent public accoimtant in accordance with generally accepted auditing standards.
"(2) In conducting an audit under this subsection, the independent public accoiuitant shall determine and report on whether the
financial statements of the Corporation (A) are presented fairly
in accordance with generally accepted accounting principles, and
(B) to the extent determined necessary by the Director, comply
with any disclosure requirements imposed under subsection
(c)(2XB).<
(r)

MORTGAGE DATA COLLECTION AND REPORTING REQUIRE-

MENTS.—Section 307 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1456) is amended by adding after subsection
(d) (as added by subsection (q) of this section) the following new
subsection:
"(eXl) The Corporation shall collect, maintain, and provide
to the Secretary, in a form determined by the Secretary, data
relating to its mortgages on housing consisting of 1 to 4 dwelling
units. Such data shall include-—
"(A) the income, census tract location, race, and gender
of mortgagors under such mortgages;
"(B) the loan-to-value ratios of purchased mortgages at
the time of origination;
"(C) whether a particular mortgage purchased is newly
originated or seasoned;
"(D) the number of imits in the housing subject to the
mortgage and whether the units are owner-occupied; and
"(E) any other characteristics that the Secretary considers
appropriate, to the extent practicable.
"(2) The Corporation shall collect, maintain, and provide to
the Secretary, in a form determined by the Secretary, data relating
to its mortgages on housing consisting of more than 4 dwelling
units. Such data shall include—
"(A) census tract location of the housing;
"(B) income levels and characteristics of tenants of the
housing (to the extent practicable);
"((J) rent levels for units in the housing;
"(D) mortgage characteristics (such as the number of luiits
financed per mortgage and the amount of loans);
"(E) mortgagor characteristics (such as nonprofit, for-profit,
limited equity cooperatives);
"(F) use of funds (such as new construction, rehabilitation,
refinancing);
"(G) type of originating institution; and

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 4007

"(H) any other information that the Secretary considers
appropriate, to the extent practicable.
"(3)(A) Except as provided in subparagraph (B), this subsection
shall apply only to mortgages purchased by the Corporation after
December 31,1992.
"(B) This subsection shall apply to any mortgage purchased
by the Corporation after the date determined under subparagraph
(A) if the mortgage was originated before such date, but only to
the extent that the data referred in paragraph (1) or (2), as
applicable, is available to the Corporation. .
(s) REPORT ON HOUSING ACTIVITIES.—Section 307 of the Federal
Home Loan Mortgage Corporation Act (12 U.S.C. 1456) is amended
by adding after subsection (e) (as added by subsection (r) of this
section) the following new subsection:
"(f)(1) The Corporation shall submit to the Committee on Banking, Finance and Urban Affairs of the House of Representatives,
the Committee on Banking, Housing, and Urban Affairs of the
Senate, and the Secretary a report on its activities under subpart
B of part 2 of subtitle A of the Federal Housing Enterprises Financial Safe^ and Soundness Act of 1992.
"(2) The report under this subsection shall—
"(A) include, in aggregate form and by appropriate category,
statements of the dollar volume and nimiber of mortgages
on owner-occupied and rental properties purchased which relate
to each of the annual housing goals established under such
subpart;
"(B) include, in aggregate form and by appropriate category,
statements of the number of families served by the Corporation,
the income class, race, and gender of homebuyers served, the
income class of tenants of rental housing (to the extent such
information is available), the characteristics of the census
tracts, and the geographic distribution of the housing financed;
"(C) include a statement of the extent to which the mortgages purchased by the Corporation have been used in conjunction with public suDsidy programs under Federal law;
"(D) include statements of the proportion of mortgages
on housing consisting of 1 to 4 dwelling units purchased by
the Corporation that have been made to first-time homebuyers,
as soon as providing such data is practicable, and identifying
any special programs (or revisions to conventional practices)
facilitating homeownership opportunities for first-time homebuyers;
"(E) include, in aggregate form and by appropriate category,
the data provided to the Secretary under subsection (eXlXB);
"(F) compare the level of securitization versus portfolio
activity;
"(G) assess underwriting standards, business practices,
repurchase requirements, pricing, fees, and procedures, that
affect the purchase of mortgages for low- and moderate-income
families, or that may jrield disparate results based on the
race of the borrower, including revisions thereto to promote
affordable housing or fair lending;
"(H) describe trends in both the primary and secondary
multifamily housing mortgage markets, including a description
of the progress made, and any factors impeding progress,
toward standardization and securitization of mortgage products
for multifamily housing;

106 STAT. 4008

PUBLIC LAW 102-550—OCT. 28, 1992

^

Public
information.

Regulations.
12 u s e 1451
note.

"(I) describe trends in the delinquency and default rates
of mortgages secured by housing for low- and moderate-income
families that have been purchased by the Corporation, including
a comparison of such trends with delinquency and default
information for mortgage products serving households with
incomes above the median level that have been purchased
by the Corporation, and evaluate the impact of such trends
on the standards and levels of risk of mortgage products serving
low- and moderate-income families;
"(J) describe in the aggregate the seller and servicer network of the Corporation, including the volume of mortgages
purchased from minority-owned, women-owned, and community-oriented lenders, and any efforts to facilitate relationships
with such lenders;
**(K) describe the activities undertaken by the Corporation
with nonprofit and for-profit organizations and with State and
local governments and housing finance agencies, including how
the Corporation's activities support the objectives of comprehensive housing affordability strategies imder section 105 of the
Cranston-Gonzalez National Affordable Housing Act; and
"(L) include any other information that the Secretary
considers appropriate.
"(3)(A) The Corporation shall make each report imder this
subsection available to the public at the principal and regional
offices of the Corporation.
"(B) Before making a report under this subsection available
to the public, the Corporation may exclude from the report information that the Secretary has determined is proprietary information
under section 1326 of the Federal Housing Enterprises Financial
Safety and Soundness Act of 1992.".
(t) HOUSING ADVISORY COUNCIL.—Section 307 of the Federal
Home Loan Mortgage Corporation Act (12 U.S.C. 1456) is amended
by adding'after subsection (f) (as added by subsection (s) of this
section) the following new subsection:
"(gXD Not later than 4 months after the date of enactment
of the Federal Housing Enterprises Financial Safety and Soundness
Act of 1992, the Corporation shall appoint an Affordable Housing
Advisory Council to advise the Coiporation regarding possible methods for promoting affordable housing for low- and moderate-income
families.
"(2) The Affordable Housing Advisory Council shall consist of
15 individuals, who shall include representatives of commimitybased and other nonprofit and for-profit organizations and State
and local government agencies actively engaged in the promotion,
development, or financing of housing for low- and moderate-income
families.".
SEC. 1383. IMPLEMENTATION.

(a) I N GENERAL.—^The Secretary of Housing and Urban Development and the Director, as appropriate, shall issue any final regulations necessary to implement the amendments made by this subtitle
not later than the expiration of the 18-month period beginning
on the date of the enactment of this Act.
(b) NOTICE AND COMMENT.—^The regulations imder this section
shall be issued after notice and opportunity for public comment
pursuant to the provisions of section 553 of title 5, United States
Code.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 4009

Subtitle E—^Regulation of Federal Home
Loan Bank System
SEC. 1391. PRIMACY OF FINANCIAL SAFETY AND SOUNDNESS FOR
FEDERAL HOUSING FINANCE BOARD.

Section 2A(aX3) of the Federal Home Loan Bank Act (12 U.S.C.
1422a(aX3)) is amended to read as follows:
"(3) DUTIES.—
"(A) SAFETY AND SOUNDNESS.—The

primary duty of the
Bosurd shall be to ensure that the Federal Home Loan Banks
operate in afinancially^safe and soimd manner.
"(B) OTHER DUTIES.—^To the extent consistent with subparagraph (A), the duties of the Board shall also be—
"(i) to supervise the Federal Home Loan Banks;
"(ii) to ensure that the Federal Home Loan Banks
carry out their housing finance mission; and
"(iii) to ensure that the Federal Home Loan Banks
remain adequately capitalized and able to raise funds in
the capital markets.".
SEC. 1392. ADVANCES UNDER FEDERAL HOME LOAN BANK ACT.
(a) ADVANCES TO NONQUALIFIED THRIFT LENDER MEMBERS.—

Section 10(e)(2) of the Federal Home Loan Bank Act (12 U.S.C.
1430(eX2)) is amended by striking the second sentence and inserting
the following new sentence: "The aggregate amount of the advances
by the Federal Home Loan Bank System to members that are
not qualified thrift lenders shall not exceed 30 percent of the total
advances of the Federal Home Loan Bank System.".
(b) EXCEPTION TO REQUIREMENTS FOR ADVANCES.—Section 10b

of the Federal Home Loan Bank Act (12 U.S.C. 1430b) is amended—
(1) in the first sentence, by inserting before "Each" the
following new subsection designation and heading: "(a) IN GENERAL.—"; and

(2) by adding at the end the following new subsection:
"(b) EXCEPTION.—^An advance made to a State housing finance
agency for the purpose of facilitating mortgage lending that benefits
individuals and families that meet the income requirements set
forth in section 142(d) or 143(f) of the Internal Revenue Code
of 1986, need not be collateralized by a mortgage insured under
title II of the National Housing Act or otherwise, if—
"(1) such advance otherwise meets the requirements of
this subsection; and
"(2) such advance meets the requirements of section ICXa)
of this Act, and any real estate collateral for such loan comprises, single family or multifamily residential mortgages.".
SEC. 1393. STUDIES REGARDING FEDERAL HOME LOAN BANK SYSTEM.

(a) IN GENERAL.—The Federal Housing Finance Board, the
Comptroller General of the United States, the Director of the
Congressional Budget Ofilce, and the Secretary of Housing and
Urban Development shall each conduct a study analyzing and making appropriate recommendations with respect to the following
topics:
(1) The appropriate capital standards for the Federal Home
Loan Bank System.

106 STAT. 4010

PUBLIC LAW 102-550—OCT. 28, 1992
(2) The relationship between the capital standards for the
Federal Home Loan Bank System and the capital standards
imder this title for the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation.
(3) The relationship between the capital standards for federally insured depository institutions and the capital standards
imder this title for the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation.
(4) The advantages and disadvantages of expanding credit
products and services for member institutions of the Federal
Home Loan Bank System, including a determination of the
feasibility of Federal Home Loan Banks (A) purchasing housingrelated assets from member institutions, (B) providing credit
enhancements and other products to members in addition to
making advances, and (C) making direct loans for housing
, construction.
'
(5) The advantages and disadvantages of expanding eligible
collateral for advances to member institutions of the Federal
Home Loan Bank System by removing the limits on the amount
of housing-related assets that member institutions can use
to collateralize advances.
(6) The advantages and disadvantages of further measures
to expand the role of the Federal Home Loan Bank System
as a support mechanism for community-based lenders and to
reinforce the overall role of the System in housing finance.
(7) The advantages and disadvantages of measures to
increase membership in, and increase the profitability of, the
System by modif3dng—
(A) restrictions on membership and stock purchases
of nonqualified thrift lenders;
(B) the overall advance limit imposed on the Federal
Home Loan Bank System to nonqualified thrift lenders;
and
(C) the membership requirement for qualified thrift
lenders.
(8) The competitive effect of the mortgage activities of
the Federal National Mortgage Association and the Federal
Home Loan Mortgage Corporation on the home mortgage activities of federally insured depository institutions and the cost
of such activities to such institutions, the Savings Association
Insurance Fund, and the Resolution Trust Corporation.
(9) The likelihood that the Federal Home Loan Banks
will be able to continue to pay the amounts required luider
the Financial Institutions Reform, Recovery, and Enforcement
Act of 1989.
(10) The extent to which a reduction in the number of
Federal Home Loan Banks would reduce noninterest costs of
the System.
(11) The impact that a reduction in the number of Federal
Home Loan Banks would have on the effectiveness of affordable
housing programs and community support programs under the
Federal Home Loan Bank System.
(12) The impact that a reduction in the number of Federal
Home Loan Banks would have on the availability of affordable
housing in rural areas and the ability of small rural financial
institutions to provide housing financing.

PUBLIC LAW 102-550—OCT. 28, 1992

106 STAT. 4011

(13) The current and prospective impact of the Federal
Home Loan Bank System on—
(A) the availability and affordability of housing for
low- and moderate-income hoiiseholds; ana
(B) the relative availability of housing credit across
geographic areas, with particular regard to differences
depending on whether properties are mside or outside of
central cities.
(14) The appropriateness of extending to the Federal Home
Loan Bank System the public purposes and housing goals established for the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation imder this title,
the Federal National Mortgage Association Charter Act, and
the Federal Home Loan Mortgage Corporation Act.
(b) REPORTS.—^Not later than 6 months after the date of the
enactment of this Act, the Federal Housing Finance Board, the
Comptroller General, the Director of the Congressional Budget
Oftice, and the Secretary of Housing and Urban Development shall
each submit to the Committee on Banking, Finance and Urban
Affairs of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate a report on
the studies required under subsection (a) containing any recommendations for legislative action based on the results of the
studies.
(c) COMMENTS.—^The Secretary of the Treasury, the Director
of the Office of Federal Housing Enterprise Oversight, the Federal
Home Loan Mortgage Corporation, and the Federal National Mortgage Association shall each submit to the Committee on Banking,
Finance and Urban Affairs of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of the
Senate any recommendations and opinions regarding the studies
imder subsection (a), to the extent that the recommendations and
views of such officers and entities differ from the recommendations
and opinions of the Federal Housing Finance Board, the Comptroller
General, the Director of Congressional Budget Office, and the
Secretary of Housing and Urban Development.
(d) DEFINITION.—For purposes of tnis section, the term "housing-related assets'* means residential mortgages, residential mortgage-related securities, loans or loan participations secured by
residential real estate, housing production loans, and warehouse
lines of credit for residential mortgage banking activities.
SEC. 1394. REPORT OF FEDERAL HOME LOAN BANK MEMBERS.

(a) IN GENERAL.—The Federal Home Loan Banks shall establish Establishment.
a committee to be known as the Study Committee. The Studv
Committee shall be comprised of 24 members, of whom 2 shall
be elected by the Board of Directors of each Federal Home Loan
Bank from among officers or directors of stockholder institutions
of the Federal Home Loan Bank. Each Federal Home Loan Bank
shall elect members to the Study Committee not later than 45
days after the date of the enactment of this Act.
(b) STUDY AND REPORT.—The Study Committee referred to in
subsection (a) shall conduct a study on the topics referred to in
section 1391(a) and on the costs and benefits of consolidation of
the Federal Home Loan Bank System. Not later than 6 months
after the date of the enactment of this Act, the Study Committee
shall submit a report to the Committee on Banking, Finance and

106 STAT. 4012

PUBLIC LAW 102-550—OCT. 28, 1992

Urban Affairs of the House of Representatives, the Committee
on Banking, Housing, and Urban Affairs of the Senate, the Federal
Housing Fmance Board, and the presidents of tiie Federal Home
Loan Banks on its findings, including any recommendations for
legislative or administrative action, together with any minority
views or recommendations.
SEC. 139S. REPORTS REGARDING