Rural Housing Preservation Act of 2019

II 116TH CONGRESS 1ST SESSION S. 2567 To provide rental assistance to low-income tenants of certain multifamily rural housing projects, and for other purposes. IN THE SENATE OF THE UNITED STATES SEPTEMBER 26, 2019 Mrs. SHAHEEN (for herself and Ms. SMITH) introduced the following bill; which was read twice and referred to the Committee on Banking, Hous- ing, and Urban Affairs A BILL To provide rental assistance to low-income tenants of certain multifamily rural housing projects, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Rural Housing Preser- 4 vation Act of 2019’’. 5 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 2 •S 2567 IS SEC. 2. AVAILABILITY OF RURAL HOUSING VOUCHERS FOR 1 TENANTS IN PROJECTS WITH MATURING 2 LOANS. 3 (a) IN GENERAL.—Section 542 of the Housing Act 4 of 1949 (42 U.S.C. 1490r) is amended by adding at the 5 end the following: 6 ‘‘(c) RURAL VOUCHERS FOR TENANTS OF PROJECTS 7 WITH PREPAID OR MATURING LOANS.— 8 ‘‘(1) AUTHORITY.—Subject to the availability of 9 amounts provided in appropriation Acts and to para- 10 graph (3), the Secretary shall provide rural housing 11 vouchers under this section, in the amount provided 12 under this section, to any low-income household (in- 13 cluding those not receiving rental assistance) resid- 14 ing in a property that is— 15 ‘‘(A) financed with a loan made or insured 16 under section 514 or 515 that has been prepaid 17 or has matured after September 30, 2005; or 18 ‘‘(B) assisted under section 514 or 516 19 that is owned by a nonprofit organization or 20 public agency. 21 ‘‘(2) ADMINISTRATION AND SUBSIDIES.— 22 ‘‘(A) IN GENERAL.—The Secretary shall, 23 to the maximum extent practicable, administer 24 and operate rural housing vouchers under this 25 section according to regulations and administra- 26 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 3 •S 2567 IS tive guidance that is applicable to enhanced 1 vouchers under section 8(t) of the United 2 States Housing Act of 1937 (42 U.S.C. 3 1437f(t)) administered by the Secretary of 4 Housing and Urban Development. 5 ‘‘(B) AMOUNT OF ASSISTANCE.—The 6 amount of rental assistance provided on behalf 7 of holders of rural housing vouchers under this 8 section shall be the same as the rental assist- 9 ance provided on behalf of holders of enhanced 10 vouchers under section 8(t) of the United 11 States Housing Act of 1937 (42 U.S.C. 12 1437f(t)). 13 ‘‘(3) TERMINATION OF ASSISTANCE.—The Sec- 14 retary shall terminate the provision of voucher as- 15 sistance pursuant to this subsection, with respect to 16 a property, if— 17 ‘‘(A) at any time, a new loan is made or 18 insured under section 514 or 515 for the prop- 19 erty; and 20 ‘‘(B) as a result of a loan described in sub- 21 paragraph (A), rental assistance is provided on 22 behalf of the voucher holder in an amount com- 23 parable to the rental assistance provided on be- 24 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 4 •S 2567 IS half of the voucher holder under the voucher 1 program. 2 ‘‘(d) LIMITATION RELATING TO PROJECTS WITH 3 PREPAID LOANS.— 4 ‘‘(1) IN GENERAL.—The Secretary shall not 5 issue rural housing vouchers under this section to 6 residents who remain in properties that— 7 ‘‘(A) were financed with a loan made or in- 8 sured under section 514 or 515 that has been 9 prepaid; and 10 ‘‘(B) are subject to any restrictive use 11 agreements entered into pursuant to section 12 502(c)(5)(G). 13 ‘‘(2) REVIEW AND APPROVAL.—The Secretary 14 shall— 15 ‘‘(A) review and approve all proposed rent 16 increases for residents of properties described in 17 paragraph (1) that are protected by the use 18 agreements described in that paragraph; and 19 ‘‘(B) issue, to those residents, limited 20 voucher assistance that covers the cost of all 21 approved future rent increases that are not re- 22 lated to the cost of prepaying the loan or refi- 23 nancing the property.’’. 24 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 5 •S 2567 IS (b) REQUIREMENT FOR SECTION 515 PROJECTS TO 1 ACCEPT VOUCHERS.—Section 515 of the Housing Act of 2 1949 (42 U.S.C. 1485) is amended by adding at the end 3 the following: 4 ‘‘(bb) REQUIREMENT TO ACCEPT RURAL HOUSING 5 VOUCHERS.—No owner of a property financed with a loan 6 made or insured under this section, whether the loan is 7 outstanding or fully paid, may refuse to lease an available 8 dwelling unit in the property to a household on behalf of 9 whom voucher assistance is provided under section 542, 10 and to enter into a voucher contract respecting the unit, 11 a proximate cause of which is the status of the current 12 or prospective tenant as a holder of that voucher.’’. 13 SEC. 3. DECOUPLING RENTAL ASSISTANCE FROM MATUR- 14 ING RURAL HOUSING LOANS. 15 Section 521(a)(2) of the Housing Act of 1949 (42 16 U.S.C. 1490a(a)(2)) is amended by adding at the end the 17 following: 18 ‘‘(F) RENTAL ASSISTANCE FOR PROJECTS WITH 19 MATURED LOANS.— 20 ‘‘(i) AUTHORITY.—To continue to make 21 decent, safe, and sanitary housing available to 22 low-income occupants of projects originally fi- 23 nanced with a loan made or insured under sec- 24 tion 514 or 515 that has matured on or after 25 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 6 •S 2567 IS the date of enactment of this subparagraph or 1 with a grant provided under section 516, and at 2 rental rates commensurate to income as speci- 3 fied in subparagraph (A), the Secretary may, 4 subject to the availability of amounts provided 5 in appropriation Acts, contract to make and 6 renew annual assistance payments pursuant to 7 this subparagraph to the owners of those 8 projects. 9 ‘‘(ii) OFFER.—The Secretary shall ensure 10 that an offer to provide a contract for assist- 11 ance payments pursuant to this subparagraph 12 shall be extended to all owners of projects de- 13 scribed in clause (i) not later than 24 months 14 before the maturation of the loan (except in the 15 case of loans maturing after the date that is 24 16 months before the date of enactment of this 17 subparagraph). 18 ‘‘(iii) TERMS.—Each contract for assist- 19 ance payments pursuant to this subparagraph 20 shall— 21 ‘‘(I) have a term of 20 years and be 22 subject to availability of amounts provided 23 in annual appropriations Acts; 24 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 7 •S 2567 IS ‘‘(II) cover all new and existing house- 1 holds residing in the project, regardless of 2 whether or not the households were pre- 3 viously assisted under the rental assistance 4 program authorized under subparagraph 5 (A); 6 ‘‘(III) be recorded at such local real 7 property recording office as is prescribed 8 by the State in which the project is lo- 9 cated; 10 ‘‘(IV) bind the owner of the project 11 and successors of the owner to continue to 12 operate the project in accordance with such 13 agreements; 14 ‘‘(V) require the owner and successors 15 of the owner to agree to continue to oper- 16 ate the project as if the project were sub- 17 ject to an existing loan under section 514 18 or 515 or a grant under section 516, as 19 applicable; 20 ‘‘(VI) extend to residents of the 21 project all the rights that at the time the 22 contract is entered into are extended to 23 residents of projects subject to an existing 24 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 8 •S 2567 IS loan under section 514 or 515 or a grant 1 under section 516, as applicable; 2 ‘‘(VII) require the owner and succes- 3 sors of the owner to maintain the assisted 4 housing as decent, safe, and sanitary hous- 5 ing; and 6 ‘‘(VIII) provide that the Secretary 7 may renew the contract for additional 5- 8 year terms if the assisted housing is main- 9 tained in a decent, safe, and sanitary con- 10 dition, as determined by the Secretary. 11 ‘‘(iv) ACTUAL MARKET RENTALS.— 12 ‘‘(I) IN GENERAL.—A contract for as- 13 sistance payments provided pursuant to 14 this subparagraph for a project shall pro- 15 vide assistance to the owner based on an 16 initial reasonable operating budget the 17 rents for which do not exceed such actual 18 market rental rates for the area in which 19 the project is located, as are established by 20 the Secretary. 21 ‘‘(II) ADJUSTMENT; RENEWAL.—The 22 Secretary shall annually adjust the actual 23 market rental rates used for purposes of 24 this clause. 25 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 9 •S 2567 IS ‘‘(v) RENEWAL; ADJUSTMENT.—In pro- 1 viding assistance pursuant to this subpara- 2 graph, the Secretary shall require the owner of 3 the project to renew the assistance provided to 4 each household not less frequently than annu- 5 ally, in accordance with the provisions of sub- 6 paragraph (A), and shall adjust the amount of 7 assistance provided to a household at any other 8 time upon a decrease in the monthly income of 9 the household of $100 or more. 10 ‘‘(vi) ADMINISTRATION.—Except as other- 11 wise provided in this subparagraph, rental as- 12 sistance contracts authorized by this subpara- 13 graph shall be administered by the Secretary in 14 the same manner as rental assistance contracts 15 for projects having existing loans made or in- 16 sured under section 515 or existing loans and 17 grants made under sections 514 and 516.’’. 18 SEC. 4. UNIFORM STANDARDS FOR TRANSFERS OF SEC- 19 TION 515 PROPERTIES USING LOW-INCOME 20 TAX CREDITS. 21 Section 515 of the Housing Act of 1949 (42 U.S.C. 22 1485), as amended by this Act, is amended by adding at 23 the end the following: 24 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 10 •S 2567 IS ‘‘(cc) REQUIREMENTS FOR TRANSFERS OF PROP- 1 ERTIES INVOLVING LOW-INCOME HOUSING TAX CRED- 2 ITS.—The Secretary shall establish, without exception, 3 uniform requirements, terms, and conditions for any sale 4 or transfer of a property financed with a loan under this 5 section to any entity, including a nonprofit organization, 6 that is seeking to acquire that property with amounts au- 7 thorized under this section and any low-income housing 8 tax credit under section 42 of the Internal Revenue Code 9 of 1986.’’. 10 SEC. 5. RURAL MULTIFAMILY HOUSING REVITALIZATION 11 PROGRAM. 12 Section 515 of the Housing Act of 1949 (42 U.S.C. 13 1485), as amended by this Act, is amended by adding at 14 the end the following: 15 ‘‘(cc) MULTIFAMILY HOUSING REVITALIZATION PRO- 16 GRAM.— 17 ‘‘(1) IN GENERAL.—The Secretary may estab- 18 lish a Multifamily Housing Revitalization Program 19 for the preservation and revitalization of multifamily 20 housing projects funded with loans made available 21 pursuant to this section and sections 514 and 516 22 to ensure that those projects have sufficient re- 23 sources to provide safe and affordable housing for 24 low-income residents and farm laborers. 25 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 11 •S 2567 IS ‘‘(2) OPTIONS.—In carrying out paragraph (1), 1 the Secretary may— 2 ‘‘(A) with respect to the loans— 3 ‘‘(i) reduce or eliminate interest; 4 ‘‘(ii) defer loan payments; and 5 ‘‘(iii) subordinate, reduce, or reamor- 6 tize loan debt; and 7 ‘‘(B) provide other financial assistance, in- 8 cluding— 9 ‘‘(i) advances; and 10 ‘‘(ii) payments and incentives (includ- 11 ing the ability of owners to obtain reason- 12 able returns on investment). 13 ‘‘(3) REQUIREMENTS.—In exchange for assist- 14 ance provided pursuant to this subsection, the Sec- 15 retary shall enter into a restrictive use agreement 16 with the property owner to ensure that the property 17 remains subject to low-income use restrictions for an 18 additional period of time consistent with the terms 19 of the restructuring. 20 ‘‘(4) USE OF FUNDS FOR RURAL HOUSING 21 VOUCHERS.— 22 ‘‘(A) AUTHORITY.—If the Secretary deter- 23 mines that additional voucher funds under sec- 24 tion 542 are needed, funds for the revitalization 25 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 12 •S 2567 IS program under this subsection may be used for 1 those vouchers for any low-income household 2 (including those not receiving rental assistance) 3 residing in a property financed with a loan 4 under this section that has been prepaid after 5 September 30, 2005. 6 ‘‘(B) AMOUNT.—Notwithstanding section 7 542, the amount of a voucher provided pursu- 8 ant to this paragraph shall be the difference be- 9 tween comparable market rent for the unit and 10 the tenant-paid rent for the unit. 11 ‘‘(C) AVAILABILITY.—Funds made avail- 12 able for vouchers pursuant to this paragraph 13 shall be subject to the availability of annual ap- 14 propriations. 15 ‘‘(D) ADMINISTRATION.—The Secretary 16 shall, to the maximum extent practicable, ad- 17 minister vouchers provided pursuant to this 18 paragraph with regulations and administrative 19 guidance that is applicable to housing vouchers 20 under section 8 of the United States Housing 21 Act of 1937 (42 U.S.C. 1437f) administered by 22 the Secretary of Housing and Urban Develop- 23 ment. 24 VerDate Sep 11 2014 01:40 Oct 05, 2019 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S2567.IS S2567 kjohnson on DSK79L0C42 with BILLS 13 •S 2567 IS ‘‘(5) USE OF VOUCHER FUNDS FOR REVITAL- 1 IZATION PROGRAM.—If the Secretary determines 2 that additional funds for the revitalization program 3 under this subsection are needed, funds for the rural 4 housing voucher program under section 542 may be 5 used for the revitalization program under this sub- 6 section.’’. 7 SEC. 6. REGULATIONS. 8 Not later than 120 days after the date of enactment 9 of this Act, the Secretary of Agriculture shall issue regula- 10 tions necessary to carry out the amendments made by this 1 [Text truncated for display. Full text available on Congress.gov.]