HomeMy WebLinkAbout22 LEGISLATIVE REPORTS 09-04-07-~ +~ Agenda Item 22
f~~ ~~' * AGENDA REPORT Reviewed:
~~ ~y
~.,~ City Manager
Finance Director N/A
MEETING DATE: SEPTEMBER 4, 2007
TO: WILLIAM A. HUSTON, CITY MANAGER
FROM: CITY CLERK'S OFFICE
SUBJECT: LEGISLATIVE REPORTS
SUMMARY:
Staff has prepared two (2) agenda reports that discuss the following legislative items:
1. Legislative items related to mobile home parks:
• AB111 (DeSaulnier) would require the approval of the majority of the residents of a
mobile home park to change any age restriction on the park
• AB1309 (Charles Calderon) would allow the landlord of a mobile home park in a
community with mobile home rent control to increase the rent to the market rate rent
when a unit becomes vacant and a new tenant occupies the unit
• AB1542 (Evans) would maintain local rent control measures on mobile home spaces
that are not purchased when a mobile home park converts to resident ownership
• SB981 (Padilla) would require the management of a mobile home park to maintain
the park's common facilities with funds acquired through rent and not other fees.
2. Legislative items related to the National Affordable Housing Trust Funds (HR2895 and S.
1518 amendment to the McKinnet-Vento Homeless Assistance Act)
RECOMMENDATION:
Pleasure of the City Council.
r
Maria R. Huizar
Chief Deputy City Clerk
Agenda Item 22
~-.. ~ ,
' Reviewed:
~= ~ ~, AGENDA REP
~: ~~~ ORT cat Mana
~~ ~ y ger ____-
~. ~ Finance Director N/A
MEETING DATE: SEPTEMBER 4, 2007
TO: WILLIAM A. HUSTON, CITY MANAGER
FROM: COMMUNITY DEVELOPMENT DEPARTMENT
SUBJECT: LEGISLATIVE REPORT - HR 2895 and S 1518
SUMMARY:
This legislative report summarizes two bills pertaining to the National Affordable Housing
Trust Fund (HR 2895) and an amendment to the Mc Kinnet-Vento Homeless Assistance
Act (S. 1518).
RECOMMENDATION:
Pleasure of the City Council.
FISCAL IMPACT:
There are no fiscal impacts associated with this action.
DISCUSSION:
Mayor Bone requested that HR 2895 and S. 1518 be agendized for the Council's
consideration. Attached are a copy of the bills along with summary and status for each bill
for the Council's information and consideration.
-~
Ju na Willkom
Senior Planner
Elizabeth A. Binsack
Community Development Director
Attachment: Summaries and full text of HR 2895 and S. 1518
S:\Cdd1CCREPORTHR 2895 and S 1518.doc
HR 2895
THE NATIONAL AFFORDABLE HOUSING TRUST FUND BILL
• The bill establishes a National Affordable Housing Trust Fund for the production of
new housing and the preservation or rehabilitation of existing housing that is
affordable for low income people.
• The goal of the Trust Fund is to construct, rehabilitate, and preserve 1,500,000 units
of housing over the next 10 years.
• The Trust Fund is funded with monies from the proposed GSE Affordable Housin
Fund (H.R.1427), Federal Housing Administration savings that result from the
enactment of the Expanding American Homeownership Act (H.R.1852), and an
other sources of funds subsequently identified. y
• The bill allocates 60% of Trust Fund monies to participating local jurisdictions and
40% to States, Indian Tribes and insular areas.
• HUD is required to develop a formula for these allocations based on a number of
factors, including population, housing affordability, percentage of very and extreme)
low income families, cost of construction and rehabilitation, and the extent of
substandard and aging housing. The bill also requires that Trust Fund grantees
provide matching funds.
• Funds can be used for construction, rehabilitation, acquisition, preservation
incentives (including for manufactured housing and community land trusts) and
operating assistance to facilitate affordability.
• Funds may be used for both rental housing that is affordable and for down payment
and closing cost assistance by first time homebuyers.
• All Trust Fund monies must be used for the benefit of low income families (below
80% of higher of state or local median income). At least 75% of funds must go to
extremely low-income families (below higher of 30% of local area median income or
national poverty level). At least 30% of fund must go to families whose incomes
qualify them for SSI benefits.
• States and participating local jurisdictions (grantees) are required to make Trust
Fund grants to eligible recipients, which can be any organization, agency, or other
entity, including for-profits, nonprofits, and faith-based organizations, that have
demonstrated the experience and the capacity to carry out the proposed activit in
the fund application. y
• Each grantee will allocate funds under its own Allocation Plan, which is based on
priority housing needs and geographic diversity, and includes selection criteria of the
HR 2895
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ability to leverage funds form other sources, and the extent to which rental housing
projects are affordable, especially for extremely low income families. Funds are
made available to alternative grantees if any grantee does not obligate funds within
2 years.
• The Fund includes a number of provisions to ensure that the funds are used for
housing and are not misused or used for other purposes, including: (a) a strict
prohibition against any funds being used for a recipient's administrative costs or
expenses, political activities, advocacy, lobbying, counseling, travel expense, or
preparation or advice on tax returns, (b) limits to be set by HUD on how much
grantees can spend on administrative costs, (c) a requirement by HUD to establish
program regulations, authority for HUD to audit each grantee's compliance, a
requirement that each grantee develop systems to ensure program compliance, and
require annual state fund use reports, and (d) authority of HUD to impose penalties
on grantees that do not comply with requirements, including requiring grantees to
reimburse misused funds.
Status:
6/28/2007: Referred to the House Committee on Financial Services.
7/19/2007: Committee Hearings Held.
7/31/2007: Committee Consideration and Mark-up Session Held.
713112007: Qrdered to be Reported (Amended) by Voice Vote.
S 1518
SHORT TITLE(S) AS INTRODUCED:
Community Partnership to End Homelessness Act of 2007
OFFICIAL TITLE AS INTRODUCED:
A bill to amend the McKinney-Vento Homeless Assistance Act to reauthorize the Act,
and for other purposes.
• The bill would amends the McKinney-Vento Homeless Assistance Act (the Act) to state as
the mission of the United States Interagency Council on Homelessness to develop and
coordinate the implementation of a national strategy to prevent and end homelessness
while maximizing federal government contributions toward such end.
• Adds to the membership of such Council the Commissioner of Social Security, the U.S.
Attorney General, and the Director of the Office of Management and Budget (OMB).
Directs the Council to develop and submit to the President and Congress a National
Strategic Plan to End Homelessness.
• Requires a collaborative applicant (a representative community homeless assistance
planning body) to be established for a geographic area by its relevant parties to design a
collaborative process for developing an application for homeless assistance funds.
• Requires the Secretary of Housing and Urban Development to make technical assistance
available to such applicants.
• Directs the Secretary to make competitive grants for specified activities in community
homeless assistance programs.
• Converts the rural homelessness grant program into a rural housing stability assistance
program.
• Directs the Secretary to award competitive grants to state or local governments or
nonprofit organizations to implement programs to prevent homelessness and to stabilize
housing for precariously housed individuals and families.
Status:
5/24/2007: Sponsor introductory remarks on measure.
5/24/2007: Read twice and referred to the Committee on Banking, Housing, and Urban
Affairs .
6/21/2007: Committee on Banking, Housing, and Urban Affairs. Hearings held.
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HR 2895 IH
110th CONGRESS
1st Session
H. R. 2895
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To establish the National Affordable Housing Trust Fund in the Treasury of the United States
to provide for the construction, rehabilitation, and preservation of decent, safe, and affordable
housing for low-income families.
IN THE HOUSE OF REPRESENTATIVES
rune 28, 2oa7
Mr. FRANK of Massachusetts (for himself, Ms. WATERS, Mr. GARY G. MILLER of California, Mr.
RAMSTAD, Ms. VELAZQUEZ, Mr. MCHUGH, Mr. ENGLISH of Pennsylvania, Mr. AL GREEN of
Texas, Mr. SHAYS, Mr. MURPHY of Connecticut, Mr. DENT, Ms. LEE, Mr. RENZI, Mr. CLAY, Mr.
SMTTH of New Jersey, Mr. LYNCH, and Mr. HINOJOSA) introduced the following bill; which was
referred to the Committee on Financial Services
A BILL
To establish the National Affordable Housing Trust Fund in the Treasury of the United States
to provide for the construction, rehabilitation, and preservation of decent, safe, and affordable
housing for low-income families.
Be it enacted by the Senate and House of Representatives of the United States of
America in Congress assembled,
ECTION 1. SHORT TITLE.
This Act may be cited as the ~ National Affordable Housing Trust Fund Act of 2007'.
SEC. 2. NATIONAL AFFORDABLE HOUSING TRUST FUND.
(a) In General- Title IT of the Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 12721 et seq.) is amended by adding at the end the following new subtitle:
'Subtitle G--National Affordable Housing Trust Fund
SEC. 291. PURPOSES.
'The purposes of this subtitle are--
(1) to address the national shortage of housing that is affordable to low-income
families by creating a permanently appropriated fund, with dedicated sources of
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funding, to finance additional housing activities, without supplanting existing
housing appropriations;
(2) to enable rental housing to be built, for families with the greatest economic
need, in mixed-income settings and in areas with the greatest economic
opportunities;
` (3) to promote ownership of one-to-four family owner-occupied housing by low-
income families; and
' (4) to construct, rehabilitate, and preserve at least 1,500,000 affordable dwelling
units over the next decade.
SEC. 292. TRUST FUND.
` (a} Establishment- There is established in the Treasury of the United States a trust fund
to be known as the National Affordable Housing Trust Fund.
` (b) Deposits to Trust Fund- The Trust Fund shall consist of--
' (1) any amounts of the Federal National Mortgage Association and the Federal
Home Loan Mortgage Corporation transferred to the Trust Fund under title XIII of
the Housing and Community Development Act of 1992;
' (2) any amounts appropriated to the Trust Fund pursuant to the authorization in
the Expanding American Homeownership Act of 2007, relating to the use of FHA
savings for an affordable housing grant fund; and
` (3) any amounts as are or may be appropriated, transferred, or credited to such
Fund under any other provisions of law.
` (c} Expenditures From Trust Fund- Amounts in the Trust Fund shall be available to the
Secretary of Housing and Urban Development, and are hereby appropriated, for providing
assistance under this subtitle.
(d} Federal Assistance- All assistance provided using amounts in the Trust Fund shall be
considered to be Federal financial assistance.
SEC. 293. ALLOCATIONS FOR STATES, INDIAN TRIBES, INSULAR AREAS,
AND PARTICIPATING LOCAL ,7URISDICTIONS.
` (a) Determination of Amount Available for Fiscal Year- For fiscal year 2008 and for each
fiscal year thereafter, the Secretary shall determine the total amount available from the
Trust Fund pursuant to section 292(c) for assistance under this subtitle and shall use
such amount to provide such assistance for such fiscal year.
` (b) Allocation- For each such fiscal year, of such total amount available from the Trust
Fund, the Secretary shall allocate for use under section 294--
` (1) 40 percent for States, Indian tribes, and insular areas; and
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` (2) 60 percent for participating local jurisdictions.
'SEC. 294. ASSISTANCE FRAM TRUST FUND.
` (a) Affordable Housing Needs Formula-
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` (1) ESTABLISHMENT AND FACTORS- The Secretary shall establish a formula to
allocate amounts made available for a fiscal year for assistance under this subtitle
among States, all Indian tribes, insular areas, and participating local jurisdictions
based on the relative needs of such entities, for funds to increase the supply of
decent quality affordable housing. The formula shall be based upon a comparison of
the following factors with respect to each State, Indian tribes, each insular area, and
each participating local jurisdiction:
` (A) The ratio of the population of the State, Indian tribes, insular area, or
participating jurisdiction, to the aggregate population of all States, Indian
tribes, insular areas, and participating jurisdictions.
` (B) The percentage of families in the jurisdiction of the State, of Indian tribes,
or of the insular area or participating jurisdiction that live in substandard
housing.
` (C) The percentage of families in the jurisdiction of the State, of Indian tribes,
or of the insular area or participating jurisdiction that pay more than 50 percent
of their annual income for housing costs.
(D) The percentage of persons in the jurisdiction of the State, of Indian tribes,
or of the insular area or participating jurisdiction having an income at or below
the poverty line.
` (E) The cost of constructing or carrying out rehabilitation of housing in the
jurisdiction of the State, of Indian tribes, or of the insular area or participating
jurisdiction.
` (F) The percentage of the population of the State, of Indian tribes, or of the
insular area or participating jurisdiction that resides in counties having
extremely low vacancy rates.
` (G) The percentage of housing stock in the jurisdiction of the State, of Indian
tribes, or of the insular area or participating jurisdiction that is extremely old
housing.
` {H) Any other factors that the Secretary determines to be appropriate.
` (2) FAILURE TO ESTABLISH- If, in any fiscal year referred to in section 293(a), the
regulations establishing the formula required under paragraph (1) of this subsection
have not been issued by the date that the Secretary determines the total amount
available from the Trust Fund for assistance under this subtitle for such fiscal year
pursuant to section 292(c), for purposes of such fiscal year--
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' (A) section 293(b), paragraphs (2} and (3) of subsection (b) of this section,
and subsection (c) of this section shall not apply;
' (B) the allocation for Indian tribes shall be such amount as the Secretary shall
establish; and
' {C) the formula amount for each State, insular area, or participating local
jurisdiction shall be determined by applying, for such State, insular area, or
participating local jurisdiction, the percentage that is equal to the percentage of
the total amounts made available for such fiscal year for allocation under
subtitle A of this title (42 U.S.C. 12741 et seq.} that are allocated in such year,
pursuant to such subtitle, to such State, insular area, or participating local
jurisdiction, respectively, and the allocation for each State, insular area, or
participating jurisdiction, for purposes of subsection (e) shall, except as
provided in subsection (d), be the formula amount for the State, insular area,
or participating jurisdiction, respectively.
(b) Formula Amount-
' (1) IN GENERAL- For each fiscal year referred to in section 293(a), the Secretary
shall determine the formula amount under this subsection for each State, for Indian
tribes, for each insular area, and for each participating local jurisdiction.
' (2) STATES, INDIAN TRIBES, AND INSULAR AREAS- The formula amount for each
State, for Indian tribes, and for each insular area shall be the amount determined
for such State, for Indian tribes, or for such insular area by applying the formula
under subsection (a) of this section to the total amount allocated under section 293
(b)(1) for all States, Indian tribes, and insular areas for the fiscal year.
' (3) PARTICIPATING LOCAL JURISDICTIONS- The formula amount for each
participating local jurisdiction shall be the amount determined for such participating
local jurisdiction by applying the formula under subsection (a) of this section to the
total amount allocated under section 293(b)(2) for all participating local jurisdictions
for the fiscal year.
' (4) NOTICE- For each fiscal year referred to in section 293(a), not later than 60
days after the date that the Secretary determines the total amount available from
the Trust Fund for such fiscal year pursuant to section 292(c) for assistance under
this subtitle, the Director shall cause to be published in the Federal Register a notice
that such amounts shall be so available.
' (c) Allocation Based on Affordable Housing Needs Formula- The allocation under this
subsection for a State, for Indian tribes, for an insular area, or for a local participating
jurisdiction for a fiscal year shall be determined as follows:
' (1) STATES- Subject to subsection (d), the allocation for a State shall be as
follows:
' (A) MINIMUM AMOUNT- If the formula amount determined under subsection
(b)(2) for the State for the fiscal year is less than 1 percent of the total amount
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allocated for such fiscal year under section 293(b)(1), the allocation for the
State shall be 1 percent of the total amount allocated for such fiscal year under
section 293(b)(1).
' (B) FORMULA AMOUNT- If the formula amount determined under subsection
(b)(2} for the State for the fiscal year is 1 percent or more of the total amount
allocated for such fiscal year under section 293(b)(1), the allocation for the
State shall be the formula amount for the State, except that the Secretary shall
reduce such formula amounts for all States whose allocations are determined
under this subparagraph on a pro rata basis by the amount necessary to
account for any increases from the formula amount for allocations made under
subparagraph (A) so that the total of the allocations for all States pursuant to
this paragraph is equal to the aggregate of the formula amounts under
subsection (b)(2) for all States.
' (2) INDIAN TRIBES AND INSULAR AREAS- The allocation for Indian tribes and for
each insular area shall be the formula amount for Indian tribes or for the insular
area, respectively, determined under subsection {b), as applicable,
' (3) PARTICIPATING LOCAL JURISDICTIONS- Subject to subsection (d), the
allocation for each participating local jurisdiction shall be the formula amount for the
jurisdiction determined under subsection (b),
' (d) Allocation Exception for Years in Which Less Than $2 Billion Is Available- If, for any
fiscal year, the total amount available pursuant to section 293(a) for assistance under
this subtitle is less than $2,000,000,000--
' (1) for each participating local jurisdiction having a formula amount of less than
$1,000,000, the allocation shall be $0; and
' (2) the allocation for the State in which such participating local jurisdiction is
located shall be increased by the amount of the formula amount for the participating
local jurisdiction.
Any adjustments pursuant to paragraphs (1} and (2) shall be made notwithstanding the
allocation percentages under section 293(b).
' (e) Grant Awards- For each fiscal year referred to in section 293(a), using the amounts
made available to the Secretary from the Trust Fund for such fiscal year under section
292(c), the Secretary shall, subject to subsection (f), make a grant to each State, insular
area, and participating local jurisdiction in the amount of the allocation under subsection
(a)(2), (c), or (d), as applicable, for the State, area, or jurisdiction, respectively.
' (f) Matching Requirement-
' {1) IN GENERAL- Each grantee for a fiscal year shall contribute to eligible activities
funded with Trust Fund grant amounts, or require the contribution to such eligible
activities by recipients of such Trust Fund grant amounts of, in addition to any such
grant amounts, not less than the following amount:
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(A) STATE, LOCAL, OR PRIVATE RESOURCES- To the extent that such
contributed amounts are derived from State, local, or private resources, one
dollar for every two dollars of such grant amounts.
(B) FEDERAL AMOUNTS- To the extent that such contributed amounts are
derived from State- or locally-controlled amounts from Federal assistance, or
from amounts made available under the affardable housing program of a
Federal Home Loan Bank pursuant to section 10{j) of the Federal Home Loan
Bank Act (12 U.S.C. 1430(j)), one dollar for every dollar of such grant
amounts.
Nothing in this paragraph may be construed to prevent a grantee or recipient from
complying with this paragraph only by contributions in accordance with
subparagraph (A), only by contributions in accordance with subparagraph (B), or by
a combination of such contributions.
(2) REDUCTION OR WAIVER FOR RECIPIENTS IN FISCAL DISTRESS- The Secretary
may reduce or waive the requirement under paragraph (1) with respect to any
grantee that the Secretary determines, pursuant to such demonstration by the
recipient as the Secretary shall require, is in fiscal distress. The Secretary shall
make determinations regarding fiscal distress for purposes of this paragraph in the
same manner, and according to the same criteria, as fiscal distress is determined
with respect to jurisdictions under section 220(d) (42 U.S.C. 12750(d)).
(3) QUALIFICATION OF SERVICES FUNDING FOR MATCH- For purposes of meeting
the requirements of paragraph (1), amounts that a grantee, recipient, or other
governmental or private agency ar entity commits to contribute to provide services
to residents of affordable housing provided using grant amounts under this subtitle,
by entering into a binding commitment for such contribution as the Secretary shall
require, shall be considered contributions to eligible activities.
(4) REDUCTION OR WAIVER FOR CERTAIN ACTIVITIES- With respect to Trust Fund
grant amounts made available for a fiscal year, the Secretary shall reduce or waive
the amount of contributions otherwise required under paragraph (1) to be made
with respect to eligible activities to be carried out with such grant amounts and for
which any variance from zoning laws or other waiver of regulatory requirements was
approved by the local jurisdiction. Such reduction may be implemented in the year
following the year in which such activities are funded with Trust Fund grant
amounts.
(g) Competitive Grants for Indian Tribes- For each fiscal year referred to in section 293
(a), the Secretary shall, using amounts allocated for Indian tribes pursuant to subsection
(a)(2)(B) or (c)(2), as applicable, and subject to subsection (f), make grants to Indian
tribes on a competitive basis, based upon such criteria as the Secretary shall establish,
which shall include the factors specified in section 295(c)(2)(B).
(h) Use by State of Unused Funds of Local )urisdictions- If any participating local
jurisdiction for which an allocation is made for a fiscal year pursuant to this section
notifies the Secretary of an intent not to use all or part of such funds, any such funds
that will not be used by the jurisdiction shall be added to the grant award under
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subsection (e) for the State in which such jurisdiction is located.
(i) Competitive Grants for Areas Without Allocation Plans and Recipients With
Insufficient Matching Contributions-
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(1) AVAILABLE AMOUNTS- For a fiscal year, the following amounts shall be
available for grants under this subsection:
(A) ALLOCATION FOR AREAS NOT SUBMITTING ALLOCATION PLANS- With
respect to each State, insular area, or participating local jurisdiction that has
not, before the expiration of the 12-month period beginning upon the date of
the publication of the notice of funding availability for such fiscal year under
subsection (b)(4), submitted to and had approved by the Secretary an
allocation plan for such fiscal year meeting the requirements of section 295, the
amount of the allocation for such State, insular area, or participating local
jurisdiction for such fiscal year determined under this section.
(B} UNMATCHED PORTION OF ALLOCATION- With respect to any grantee for
which the Trust Fund grant amount awarded for such fiscal year is reduced
from the amount of the allocation determined under this section for the grantee
by reason of failure comply with the requirements under subsection (f), the
amount by which such allocation for the grantee for the fiscal year exceeds the
Trust Fund grant amount for the grantee for the fiscal year.
(C) UNCOMMITTED AMOUNTS- Any Trust Fund grant amounts for a fiscal year
that are not committed for use for eligible activities before the expiration of the
24-month period beginning upon the date of the publication of the notice of
availability of amounts under subsection (b)(4) for such fiscal year.
(D) UNUSED AMOUNTS- Any Trust Fund grant amounts for which the grantee
notifies the Secretary that such funds will not be used under this subtitle.
(2) NOTICE- For each fiscal year, not later than 60 days after the date that the
Secretary determines that the amounts described in paragraph (1) shall be available
for grants under this subsection, the Secretary shall cause to be published in the
Federal Register a notice that such amounts shall be so available.
(3) APPLICATIONS- The Secretary shall provide for nonprofit and public entities
(and consortia thereof, which may include regional consortia of units of local
government) to submit applications, during the 9-month period beginning upon
publication of a notice of funding availability under paragraph (2) for a fiscal year,
for a grant of all or a portion of the amounts referred to in paragraph (1) for such
fiscal year. Such an application shall include a certification that the applicant will
comply with all requirements of this subtitle applicable to a grantee under this
subsection.
(4) SELECTION CRITERIA- The Secretary shall, by regulation, establish criteria for
selecting applicants that meet the requirements of paragraph (3) for funding under
this subsection. Such criteria shall give priority to applications that provide that
grant amounts under this subsection will be used for eligible activities relating to
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affordable housing that is located in the State or insular area, as applicable, for
which such grant funds were originally allocated under this section,
` (5) AWARD AND USE OF GRANT ASSISTANCE-
' {A) AWARD- Subject only to the absence of applications meeting the
requirements of paragraph (3), upon the expiration of the period referred to in
such paragraph, the Secretary shall select an applicant or applicants under this
subsection to receive the amounts available under paragraph (1) and shall
make a grant or grants to such applicant or applicants. The selection shall be
based upon the criteria established under paragraph {4).
` {B) USE- Amounts from a grant under this subsection shall be Trust Fund
grant amounts for purposes of this subtitle.
`SEC. 295. ALL4CATIUN PLANS.
` (a) In General- Each grantee .that is a State, insular area, participating local jurisdiction,
or grantee under section 294(i) for a fiscal year, shall establish an allocation plan in
accordance with this section for the distribution of Trust Fund grant amounts provided to
the grantee for such fiscal year, which shall be a plan that--
` (1) provides for use of such amounts in accordance with section 296;
(2) is based on priority housing needs, as determined by the grantee; and
(3) is consistent with the comprehensive housing affordability strategy under
section 105 (42 U.S.C. 12705) or any applicable consolidated submission used for
purposes of applying for other community planning and development and housing
assistance programs administered by the Secretary, for the applicable State, insular
area, jurisdiction, or grantee under section 294(i).
` (b) Establishment- In establishing an allocation plan, a grantee described in subsection
(a) shall notify the public of the establishment of the plan, provide an opportunity for
public comments regarding the plan, consider any public comments received, and make
the completed plan available to the public.
` (c} Contents- Each allocation plan of a grantee described in subsection (a) shall comply
with the following requirements:
` (1) APPLICATION REQUIREMENTS FOR. ELIGIBLE RECIPIENTS- The allocation plan
shall set forth the requirements for eligible recipients to apply to the grantee to
receive assistance from Trust Fund grant amounts of the grantee for use for eligible
activities, including a requirement that each such application include--
` (A) a description of the eligible activities to be conducted using such
assistance; and
' {B) a certification by the eligible recipient applying for such assistance that
any housing assisted with such grant amounts will comply with--
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' (i) all of the requirements under this subtitle, including the targeting
requirements under section 296(c) and the affordable housing
requirements under section 297;
(ii) section 808(d) of the Fair Housing Act (relating to the obligation to
affirmatively further fair housing); and
' (iii) section 504 of the Rehabilitation Act of 1973 (relating to prohibition
of discrimination on the basis of disability).
' (2) SELECTION PROCESS AND CRITERIA FOR ASSISTANCE-
(A) SELECTION PROCESS- The allocation plan shall set forth a process for the
grantee to select eligible activities meeting the grantee's priority housing needs
for funding with Trust Fund grant amounts of the grantee, which shall comply
with requirements for such process as the Secretary shall, by regulation,
establish.
' (B) SELECTION CRITERIA- The allocation plan shall set forth the factors for
consideration in selecting among applicants that meet the application
requirements established pursuant to paragraph (1), which shall provide for
geographic diversity among eligible activities to be assisted with Trust Fund
grant amounts of the grantee and shall include--
' (i) the merits of the proposed eligible activity of the applicant, including
the extent to which the activity addresses housing needs identified in the
allocation plan of the grantee and the applicable comprehensive housing
affordability strategy or consolidated submission referred to in subsection
(a)(3);
' (ii) the ability of the applicant to obligate grant amounts for the proposed
eligible activities and to undertake such activities in a timely manner;
' (iii) the amount of assistance leveraged by the applicant from private and
other non-Federal sources for carrying out the eligible activities to be
funded with Trust Fund grant amounts, including assistance made
available under section 8 of the United States Housing Act of 1937 (42
U.S.C. 1437f) that is devoted to the project that contains the affordable
housing to be assisted with such assistance;
' (iv} the extent of local assistance that will be provided in carrying out the
eligible activities, including financial assistance;
' (v) the degree to which the project in which the affordable housing will
be located will have residents of various incomes;
' (vi) the extent of employment and other economic opportunities for low-
income families in the area in which the housing will be located;
' (vii) the extent to which the applicant demonstrates the ability to
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maintain dwelling units as affordable housing through the use of
assistance made available under this subtitle, assistance leveraged from
non-Federal sources, assistance made available under section 8 of the
United States Housing Act of 1937 (42 U.S.C. 1437f), State or local
assistance, programs to increase tenant income, cross-subsidization, and
any other resources;
(viii) the extent to which the applicant demonstrates that the county in
which the housing is to be located is experiencing an extremely low
vacancy rate;
' (ix) the extent to which the percentage of the housing located in such
county that is extremely old housing exceeds 35 percent;
' (x) the extent to which the housing assisted with the grant amounts will
be accessible to persons with disabilities;
' (xi) the extent to which the applicant demonstrates that the affordable
housing assisted with the grant amounts will be located in proximity to
public transportation, job opportunities, child care, and community
revitalization projects;
(xii) the extent to which the applicant has provided that assistance from
grant amounts wi[I be used for eligible activities relating to housing located
in census tracts in which the number of families having incomes less than
the poverty line is less than 20 percent; and
(xiii) the extent to which the housing. assisted with grant amounts will
comply with energy efficiency standards and the national Green
Communities criteria checklist for residential construction that provides
criteria for the design, development, and operation of affordable housing,
as the Secretary shall by regulation provide.
(3) PERFORMANCE GOALS, BENCHMARKS, AND TIMETABLES- The allocation plan
shall include performance goals, benchmarks, and timetables for the grantee for the
conducting of eligible activities with Trust Fund grant amounts that comply with
requirements and standards for such goals, benchmarks, and timetables as the
Secretary shall, by regulation, establish.
(d) Review and Approval by Secretary-
' (1) SUBMISSION- A grantee described in subsection (a) shall submit an allocation
plan for the fiscal year for which the grant is made to the Secretary not later than
the expiration of the 6-month period beginning upon the notice of funding
availability under section 294(b)(4) for such fiscal year amounts.
' (2) REVIEW AND APPROVAL OR DISAPPROVAL- The Secretary shall review and
approve or disapprove an allocation plan not later than the expiration of the 3-
month period beginning upon submission of the plan.
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(3) STANDARD FOR DISAPPROVAL- The Secretary may disapprove an allocation
plan only if the plan fails to comply with requirements of this section or section 296.
' (4) RESUBMISSION UPON DISAPPROVAL- If the Secretary disapproves a plan, the
grantee may submit to the Secretary a revised plan for review and approval or
disapproval under this subsection.
' (5) TIMING FOR FISCAL YEAR 2008- With respect only to fiscal year 2008, the
Secretary may extend each of the periods referred to in paragraphs (1) and (2), and
the period referred to in section 294(i)(1)(A), by not more than 6 months.
SEC. 296. USE OF ASSISTANCE BY RECIPIENTS.
(a} Distribution to Recipients; Use Requirements- Each grantee shall distribute Trust
Fund grant amounts of the grantee to eligible recipients for use in accordance with this
section. Trust Fund grant amounts of a grantee may be used, or committed for use, only
for eligible activities that--
' (1) are conducted in the jurisdiction of the grantee;
' {2) in the case of a grantee that is a State, insular area, participating local
jurisdiction, or grantee under section 294(i}, comply with the allocation plan of the
grantee under section 295;
' (3) are selected for funding by the grantee in accordance with the process and
criteria for such selection established pursuant to section 295(c)(2); and
' (4) comply with the targeting requirements under subsection (c) of this section and
the affordable housing requirements under section 297,
' (b) Eligible Recipients- Trust Fund grant amounts of a grantee may be provided only to
an organization, agency, or other entity (including afor-profit entity, a nonprofit entity,
and afaith-based organization) that--
' (1) demonstrates the experience, ability, and capacity (including financial capacity)
to undertake, comply, and manage the eligible activity;
' (2) demonstrates its familiarly with the requirements of any other Federal, State or
local housing program that will be used in conjunction with such grant amounts to
ensure compliance with all applicable requirements and regulations of such
programs; and
(3) makes such assurances to the grantee as the Secretary shall, by regulation,
require to ensure that the .recipient will comply with the requirements of this subtitle
during the entire period that begins upon selection of the recipient to receive such
grant amounts and ending upon the conclusion of all eligible activities that are
engaged in by the recipient and funded with such grant amounts.
' (c) Targeting Requirements- The targeting requirements under this subsection are as
follows:
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` (1) REQUIREMENT OF USE OF ALL AMOUNTS FOR AFFORDABLE HOUSING FOR
LOW-INCOME FAMILIES- All Trust Fund grant amounts of a grantee shall be
distributed for use only for eligible activities relating to affordable housing that are
for the benefit only of families whose incomes do not exceed 80 percent of the
greater of--
` (A) the median family income for the area in which the housing is located, as
determined by the Secretary with adjustments for smaller and larger families;
and
` (B} the median family income for the State or insular area in which the
housing is located, as determined by the Secretary with adjustments for
smaller and larger families.
` (2) USE OF 75 PERCENT FOR AFFORDABLE HOUSING FOR EXTREMELY LOW-
INCOME FAMILIES- Not less than 75 percent of the Trust Fund grant amounts of a
grantee for each fiscal year shall be used only for eligible activities relating to
affordable housing that are for the benefit only of families whose incomes do not
exceed the higher of--
` (A) 30 percent of the median family income for the area in which the housing
is located, as determined by the Secretary with adjustments for smaller and
larger families; and
` (B) the poverty line (as such term is defined in section 673 of the Omnibus
Budget Reconciliation Act of 1981 (42 U.S.C. 9902), including any revision
required by such section) applicable to a family of the size involved.
` (3) USE OF 30 PERCENT FOR AFFORDABLE HOUSING FOR VERY POOR FAMILIES-
Not less than 30 percent of the Trust Fund grant amounts of a grantee for each
fiscal year shall be used only for eligible activities relating to affordable housing that
are for the benefit only of families whose incomes do not exceed the maximum
amount of income that an individual or family could have, taking into consideration
any income disregards, and remain eligible for benefits under the Supplemental
Security Income program under title XVI of the Social Security Act (42 U.S.C. 1381
et seq .) .
` (4) LIMITATION FOR YEARS IN WHICH LESS THAN $2 BILLION IS AVAILABLE- If,
for any fiscal year, the total amount available pursuant to section 293(a) for
assistance under this subtitle is less than $2,000,000,000, in addition to the other
requirements under this subsection--
` {A) all such amounts shall be used only for eligible activities relating to
affordable housing that are for the benefit only of families whose incomes do
not exceed the amount described in paragraph (2) of this subsection; and
` (B) not less than 40 percent of such amounts shall be used only for eligible
activities relating to affordable housing that is for use only by families whose
incomes do not exceed the greater of the amounts described in paragraphs (2)
and (3) of this subsection.
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(d) Use for Rural Areas- Of the Trust Fund grant amounts for any fiscal year for any
grantee that is a State or participating jurisdiction that includes any rural areas, the State
or participating jurisdiction shall use a portion for eligible activities located in rural areas
that is proportionate to the identified need for such activities in such rural areas.
` {e) Cost Limits- The Secretary shall establish limitations on the amount of Trust Fund
grant amounts that may be used, on a per unit basis, for eligible activities. Such
limitations shall be the same as the per unit cost limits established pursuant to section
212(e) (42 U.S.C. 12742(e)), as adjusted annually, and established by number of
bedrooms, market area, and eligible activity.
` (f) Forms of Assistance-
` (1) IN GENERAL- Assistance may be distributed pursuant to this section in the form
of--
` (A) capital grants, noninterest-bearing or low-interest loans or advances,
deferred payment loans, guarantees, and loan loss reserves;
` (B) in the case of assistance for ownership of one- to four-family owner-
occupied housing, downpayment assistance, closing cost assistance, and
assistance for interest rate buy-downs; and
` (C) any other forms of assistance approved by the Secretary.
` (2) REPAYMENTS- If a grantee awards assistance under this section in the form of
a loan or other mechanism by which funds are later repaid to the grantee, any
repayments and returns received by the grantee shall be distributed by the grantee
in accordance with the allocation plan under section 295 for the grantee for the fiscal
year in which such repayments are made or returns are received.
` (g) Coordination With Other Assistance- In distributing assistance pursuant to this
section, each grantee shall, to the maximum extent practicable, coordinate such
distribution with the provision of other Federal, State, tribal, and local housing
assistance, including--
` (1) in the case of any State, housing credit dollar amounts allocated by the State
under section 42(h) of the Internal Revenue Code of 1986;
` (2) assistance made available under subtitles A through F (42 U.S.C. 12721 et
seq.) or the community development block grant program under title I of the
Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.);
` (3) private activity bonds;
(4) assistance made available under section 9 of the United States Housing Act of
1937 (42 U.S.C. 14378);
(5) assistance made available under section 8(0) of the United States Housing Act
of 1937 (42 U . S. C. 1437f(o));
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(6) assistance made available under title V of the Housing Act of 1949 (42 U.S.C.
1471 et seq.);
' (7) assistance .made available under section 101 of the Native American Housing
Assistance and Self-Determination Act of 1996 (25 U.S.C. 4111);
' (8) assistance made available from any State or local housing trust fund
established to provide or assist in making available affordable housing; and
' (9) any other housing assistance programs.
(h) Prohibited Uses- The Secretary shall--
(1) by regulation, set forth prohibited uses of grant amounts under this subtitle,
which shall include use for--
' (A) political activities;
' (B) advocacy;
(C) lobbying, whether directly or through other parties;
(D} counseling services;
' (E) travel expenses; and
(F} preparing or providing advice on tax returns;
' (2) by regulation, provide that, except as provided in paragraph (3), grant
amounts under this subtitle may not be used for administrative, outreach, or other
costs of--
(A) a g ra ntee; o r
' (B) any recipient of such grant amounts; and
' (3) by regulation, limit the amount of any Trust Fund grant amounts for a fiscal
year that may be used for administrative costs of the grantee of carrying out the
program required under this subtitle to a percentage of such grant amounts of the
grantee for such fiscal year, which may not exceed 10 percent.
(i} Labor Standards- Each grantee receiving Trust Fund grant amounts shall ensure that
contracts for eligible activities assisted with such amounts comply with the same
requirements under section 286 (42 U.S.C. 12836) that are applicable to contracts for
construction of affordable housing assisted under such Act.
' (j) Compliance With Other Federal Laws- All amounts from the Trust Fund shall be
allocated in accordance with, and any eligible activities carried out in whole or in part
with grant amounts under this subtitle (including housing provided with such grant
amounts) shall comply with and be operated in compliance with, other applicable
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provisions of Federal law, including--
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' (1) laws relating to tenant protections and tenant rights to participate in decision
making regarding their residences;
' (2) laws requiring public participation, including laws relating to Consolidated
Plans, Qualified Allocation Plans, and Public Housing Agency Plans; and
' (3) fair housing laws and laws regarding accessibility in federally assisted housing,
including section 504 of the Rehabilitation Act of 1973.
SEC. 297. AFFORDABLE HOUSING.
' (a) Rental Housing- A rental dwelling unit {which may include a dwelling unit in limited
equity cooperative housing, as such term is defined in section 143(k) of the Internal
Revenue Code of 1986 (26 U.S.C. 143(k)) or in housing of a cooperative housing
corporation, as such term is defined in section 216(b) of the Internal Revenue Code of
19$6 {26 U.S.A. 216(b))), shall be considered affordable housing for purposes of this
subtitle only if the dwelling unit is subject to legally binding commitments that ensure
that the dwelling unit meets all of the following requirements:
' (1) RENTS- The dwelling unit bears a rent not greater than the lesser of--
' (A) the existing fair market rental established by the Secretary under section
8(c) of the United States Housing Act of 1937 (42 U.S.C. 1437f(c)) for a
dwelling unit of the same size in the same market area, or the applicable
payment standard for assistance under section 8(0) of such Act, if higher; and
' (B) a rent that does not exceed 30 percent of the adjusted income of a family
whose income equals 65 percent of the median income for the area, as
determined by the Secretary, with adjustment for number of bedrooms in the
unit, except that the Secretary may establish income ceilings higher or lower
than 65 percent of the median for the area on the basis of the findings of the
Secretary that such variations are necessary because of prevailing levels of
construction costs or fair market rents, or unusually high or low family incomes.
' (2) TENANT RENT CONTRIBUTION- The contribution toward rent by the family
residing in the dwelling unit will not exceed 30 percent of the adjusted income of
such family.
' (3) NON-DISCRIMINATTON AGAINST VOUCHER HOLDERS- The dwelling unit is
located in a project in which all dwelling units are subject to enforceable restrictions
that provide that a unit may not be refused for leasing to a holder of a voucher of
eligibility under section 8 of the United States Housing Act of 1937 (42 U.S.C. 1437f)
because of the status of the prospective tenant as a holder of such voucher.
' (4) MIXED INCOME-
' {A) IN GENERAL- The dwelling unit is located in a project in which not more
than 50 percent of the rental units in the project that receive assistance under
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this subtitle and are not previously occupied may be rented initially to families
with incomes described in section 295(c)(2), as determined at a reasonable
time before occupancy.
' (B) EXCEPTIONS- Subparagraph (A) shall not apply in the case of a project
having 25 or fewer dwelling units that is--
' (i) located in a census tract in which the number of families having
incomes less than the poverty line is less than 20 percent;
' (ii) located in a rural area, as such term is defined in section 520 of the
Housing Act of 1949 (42 U.S.C. 1490); or
' (iii} specifically made available only for households comprised of elderly
families or disabled families.
' (5) VISITABILITY- To the extent the dwelling unit is not required under Federal law
to comply with standards relating to accessibility to persons with disabilities, the
dwelling unit complies with such basic visitability standards as the Secretary shall by
regulation provide.
' {6) DURATION OF USE- The dwelling unit will continue to be subject to all
requirements under this subsection for nat less than 50 years.
' (b) Owner-Occupied Housing- For purposes of any eligible activity involving one- to
four-family owner-occupied housing (which may include housing of a cooperative housing
corporation, as such term is defined in section 216(b) of the Internal Revenue Code of
1986 (26 U.S.A. 216(b})), such a residence shall be considered affordable housing for
purposes of this subtitle only if--
' (1) in the case of housing to be made available for purchase--
' (A) the housing is available for purchase only for use as a principal residence
by families that qualify as first-time homebuyers, as such term is defined in
section 104 (42 U.S.C. 12704), except that any reference in such section to
assistance under title II of this Act shall for purposes of this section be
considered to refer to assistance from Trust Fund grant amounts;
(B) the housing has an initial purchase price that meets the requirements of
section 215(b)(1); and
' (C) the housing is subject to the same resale restrictions established under
section 215(b)(3) and applicable to the participating jurisdiction that is the
State in which such housing is located; and
' {2) the housing is made available for purchase only by, or in the case of assistance
to a homebuyer pursuant to this subsection, the assistance is made available only
to, homebuyers who have, before purchase, completed a program of counseling with
respect to the responsibilities and financial management involved in homeownership
that is approved by the Secretary; except that the Secretary may, at the request of
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a State, waive the requirements of this paragraph with respect to a geographic area
or areas within the State if--
` (A) the travel time or distance involved in providing counseling with respect to
such area or areas, as otherwise required under this paragraph, on an in-
person basis is excessive or the cost of such travel is prohibitive; and
(B) the State provides alternative forms of counseling for such area or areas,
which may include interactive telephone counseling, on-line counseling,
interactive video counseling, and interactive home study counseling and a
program of financial literacy and education to promote an understanding of
consumer, economic, and personal finance issues and concepts, including
saving for retirement, managing credit, long-term care, and estate planning
and education on predatory lending, identity theft, and financial abuse schemes
relating to homeownership that is approved by the Secretary, except that
entities providing such counseling shall not discriminate against any particular
form of housing; and
'SEC. 298. OTHER PROVISIONS.
' (a) Effect of Assistance Under Program- Notwithstanding any other provision of law, the
provision of assistance under this subtitle for a project shall not reduce the amount of
assistance for which such project is otherwise eligible under subtitles A through F of this
title, if the project does not exceed the cost limits established pursuant to section 296(e).
' (b) Accountability of Grantees and Recipients-
' (1) RECIPIENTS-
` (A) TRACKING OF FUNDS- The Secretary shall--
' (i) require each grantee to develop and maintain a system to ensure that
each recipient of assistance from Trust Fund grant amounts of the grantee
uses such amounts in accordance with this subtitle, the regulations issued
under this subtitle, and any requirements or conditions under which such
amounts were provided; and
' (ii) establish minimum requirements for agreements, between the
grantee and recipients, regarding assistance from the Trust Fund grant
amounts of the grantee, which shall include--
' (I) appropriate continuing financial and project reporting, record
retention, and audit requirements for the duration of the grant to the
recipient to ensure compliance with the limitations and requirements
of this subtitle and the regulations under this subtitle; and
` (II) any other requirements that the Secretary determines are
necessary to ensure appropriate grant administration and compliance.
' (B) MISUSE OF FUNDS-
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` (i) REIMBURSEMENT REQUIREMENT- If any recipient of assistance from
Trust Fund grant amounts of a grantee is determined, in accordance with
clause (ii), to have used any such amounts in a manner that is materially
in violation of this subtitle, the regulations issued under this subtitle, or
any requirements or conditions under which such amounts were provided,
the grantee shall require that, within 12 months after the determination of
such misuse, the recipient shall reimburse the grantee for such misused
amounts and .return to the grantee any amounts from the Trust Fund grant
amounts of the grantee that remain unused or uncommitted for use. The
remedies under this clause are in addition to any other remedies that may
be available under law.
` (ii) DETERMINATION- A determination is made in accordance with this
clause if the determination is--
` (I) made by the Secretary ; or
` (II)(aa) made by the grantee;
` (bb} the grantee provides notification of the determination to the
Secretary for review, in the discretion of the Secretary, of the
determination; and
` (cc) the Secretary does not subsequently reverse the determination.
` (2) GRANTEES-
` (A) REPO RT-
(i) IN GENERAL- The Secretary shall require each grantee receiving Trust
Fund grant amounts for a fiscal year to submit a report, for such fiscal
year, to the Secretary that--
` (I) describes the activities funded under this subtitle during such
year with the Trust Fund grant amounts of the grantee; and
` (II) the manner in which the grantee complied during such fiscal
year with the allocation plan established pursuant to section 295 for
the grantee.
` (ii} PUBLIC AVAILABILITY- The Secretary shall make such reports
pursuant to this subparagraph publicly available.
` (B) MISUSE OF FUNDS- If the Secretary determines, after reasonable notice
and opportunity for hearing, that a grantee has failed to comply substantially
with any provision of this subtitle and until the Secretary is satisfied that there
is no longer any such failure to comply, the Secretary shall--
' (i) reduce the amount of assistance under this section to the grantee by
an amount equal to the amount of Trust Fund grant amounts which were
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not used in accordance with this subtitle;
' (ii) require the grantee to repay the Secretary an amount equal to the
amount of the Trust Fund grant amounts which were not used in
accordance with this subtitle;
' (iii) limit the availability of assistance under this subtitle to the grantee to
activities or recipients not affected by such failure to comply; or
' (iv) terminate any assistance under this subtitle to the grantee.
SEC. 299. DEFINITIt3NS.
'For purposes of this subtitle, the following definitions shall apply:
' {1) ELIGIBLE ACTIVITIES- The term 'eligible activities' means activities relating to
the construction, preservation, or rehabilitation of affordable rental housing or
affordable one- to four-family owner-occupied housing, including--
' (A} the construction of new housing;
' (B) the acquisition of real property;
' (C) site preparation and improvement, including demolition;
' {D} rehabilitation of existing housing;
' (E) use of funds to facilitate affordability for homeless and other extremely
low-income households of dwelling units assisted with Trust Fund grant
amounts, in a combined amount not to exceed 20 percent of the project grant
amount, for--
' (i) project-based rental assistance for not more than 12 months for a
project assisted with Trust Fund grant amounts;
' (ii) project operating reserves for use to cover the loss of rental
assistance or in conjunction with a project loan; or
' (iii) project operating accounts used to cover net operating income
shortfalls for dwelling units assisted with Trust Fund grant amounts; and
' (F} providing incentives to maintain existing housing {including manufactured
housing) as affordable housing and to establish or extend any low-income
affordability restrictions for such housing, including covering capital
expenditures and costs of establishing community land trusts to provide sites
for manufactured housing provided such incentives;
' (2) ELIGIBLE RECIPIENT- The term 'eligible recipient' means an entity that meets
the requirements under section 296(b) for receipt of Trust Fund grant amounts of a
grantee.
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(3) EXTREMELY LOW VACANCY RATE- The term ~ extremely low vacancy rate'
means a housing or rental vacancy rate of 2 percent or less.
(4) EXTREMELY OLD HOUSING- The term ~ extremely old housing' means housing
that is 45 years old or alder.
(5) FAMILIES- The term 'families' has the meaning given such term in section 3(b)
of the United States Housing Act of 1937 (42 U.S.C. 1437a(b)}.
(6) FISCAL DISTRESS; SEVERE FISCAL DISTRESS- The terms ~ fiscal distress' and
'severe fiscal distress' have the meanings given such terms in section 220(d).
(7) GRANTEE- The term 'grantee' means--
(A) a State, insular area, or participating local jurisdiction for which a grant is
made under section 294(e);
(B) an Indian tribe far which a grant is made under section 294(8); or
(C) a nonprofit or public entity for which a grant is made under section 294(i).
(8) INDIAN TRIBE- The term ~ Indian tribe' means a federally recognized Indian
tribe.
(9) INSULAR AREA- The term ~ insular area' has the meaning given such term in
section 104.
(10) PARTICIPATING LOCAL JURISDICTION- The term ~ participating local
jurisdiction' means, with respect to a fiscal year--
(A) any unit of general local government (as such term is defined in section
104 (42 U.S.C. 12704) that qualifies as a participating jurisdiction under
section 216 (42 U.S.C. 12746) for such fiscal year; and
(B) at the option of such a consortium, any consortium of units of general
local governments that is designated pursuant to section 216 (42 U.S.C.
12746) as a participating jurisdiction for purposes of title II.
(11) POVERTY LINE- The term ~ poverty line' has the meaning given such term in
section 673(2) of the Omnibus Budget Reconciliation Act of 1981, including any
revision required by such section.
(12) RECIPIENT- The term ~ recipient' means an entity that receives assistance
from a grantee, pursuant to section 296(a), from Trust Fund amounts of the
grantee.
(13) RURAL AREA- The term ~ rural area' has the meaning given such term in
section 520 of the Housing Act of 1949 (42 U.S.C. 1490).
(14) SECRETARY- The term ~ Secretary' means the Secretary of Housing and Urban
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Development.
{15) STATE- The term ~ State' has the meaning given such term in section 104.
{16) TRUST FUND- The term ~ Trust Fund' means the National Affordable Housing
Trust Fund established under section 292.
(17) TRUST FUND GRANT AMOUNTS- The term Trust Fund grant amounts' means
amounts from the Trust Fund that are provided to a grantee pursuant to subsection
(e), {g), or (i) of section 294.
SEC. goo. INAPPLICABILITY OF HOME PROVISIONS.
Except as specifically provided otherwise in this subtitle, no requirement under, or
provision of, title 1 or subtitles A through F of this title shall apply to assistance provided
under this subtitle.
'SEC. 301. REGULATIONS.
Not later than 6 months after the date of enactment of the National Affordable Housing
Trust Fund Act of 2007, the Secretary of Housing and Urban Development shall
promulgate regulations to carry out this subtitle, which shall include regulations
establishing the affordable housing needs formula in accordance with section 294(a).'.
(b) Conforming Amendment- Section 201 of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12701 note) is amended by striking 'This title' and inserting
Subtitles A through F of this title'.
END
~~~~~~t~~ ~~iar~~e ~ C~r~t~cr ~ Acr~~s~~ili~y ~ ~~ ~ u~~.~o~
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............................................................................................................................................................
S 1518 IS
110th CONGRESS
1st Session
S. 1515
To amend the McKinney-Vento Homeless Assistance Act to reauthorize the Act, and for other
purposes.
IN THE SENATE OF THE UNITED STATES
May 24, 2ClU7
Mr. REED (for himself, Mr. ALLARD, Ms. MIKULSKI, Mr. BOND, Mr. DURBIN, Ms. COLLINS, Mr.
SCHUMER, Mr. AKAKA, Mrs. CLINTON, Mr. WHITEHOUSE, Mr. LEVIN, Mr. BROWN, and Mrs.
``BOXER) introduced the following. bill; which was read twice and referred to the Committee on
'...Banking, Housing, and Urban Affairs
A BILL
~o amend the McKinney-Vento Homeless Assistance Act to reauthorize the Act, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the United States of
America in Congress assembled,
ECTION 1. SHtJRT TITLE; TABLE OF CQNTENTS.
(a) Short Title- This Act may be cited as the ~ Community Partnership to End
Homelessness Act of 2007'.
(b) Table of Contents- The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings and purpose.
Sec. 3. United States Interagency Council on Homelessness.
Sec. 4. Housing assistance general provisions.
Sec. 5. Emergency homelessness prevention and shelter grants program.
Sec. 6. Homeless assistance program.
Sec. 7. Rural housing stability assistance.
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Sec. 8. Funds to prevent homelessness and stabilize housing for precariously housed
individuals and families.
Sec. 9. Repeals and conforming amendments.
Sec. 10. Effective date.
SEC. 2. FINDINGS AND PURPCISE.
Section 102 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11301) is
amended to read as follows:
'SEC. 102. FINDINGS AND PURPOSE.
(a} Findings- Congress finds that--
(1) the United States faces a crisis of individuals and families who lack basic
affordable housing and appropriate shelter;
(2) assistance from the Federal Government is an important factor in the success
of efforts by State and local governments and the private sector to address the
problem of homelessness in a comprehensive manner;
(3) there are several Federal Government programs to assist persons experiencing
homelessness, including programs for individuals with disabilities, veterans,
children, and youth;
(4) homeless assistance programs must be evaluated on the basis of their
effectiveness in reducing homelessness, transitioning individuals and families to
permanent housing and stability, and optimizing their self-sufficiency;
(5) States and units of general local government receiving Federal block grant and
other Federal grant funds must be evaluated on the basis of their effectiveness in--
(A) implementing plans to appropriately discharge individuals to and from
mainstream service systems; and
(B) reducing barriers to participation in mainstream programs, as identified in-
(i) a report by the Government Accountability Office entitled
Homelessness: Coordination and Evaluation of Programs Are Essential',
issued February 26, 1999; or
(ii) a report by the Government Accountability Office entitled
Homelessness: Barriers to Using Mainstream Programs', issued July 6,
2000;
(6) an effective plan for reducing homelessness should provide a comprehensive
housing system (including permanent housing and, as needed, transitional housing)
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that recognizes that, while some individuals and families experiencing homelessness
attain economic viability and independence utilizing transitional housing and then
permanent housing, others can reenter society directly and optimize self-sufficiency
through acquiring permanent housing;
` (7) supportive housing activities include the provision of permanent housing or
transitional housing, and appropriate supportive services, in an environment that
can meet the short-term or long-term needs of persons experiencing homelessness
as they reintegrate into mainstream society;
` (8) homeless housing and supportive services programs within a community are
most effective when they are developed and operated as part of an inclusive,
collaborative, locally driven homeless planning process that involves as decision
makers persons experiencing homelessness, advocates for persons experiencing
homelessness, service organizations, government officials, business persons,
neighborhood advocates, and other community members;
` (9) homelessness should be treated as a symptom of many neighborhood,
community, and system problems, whose remedies require a comprehensive
approach integrating all available resources;
` (10) there are many private sector entities, particularly nonprofit organizations,
that have successfully operated outcome-effective homeless programs;
(11) Federal homeless assistance should supplement other public and private
funding provided by communities for housing and supportive services for low-income
households;
` (12) the Federal Government has a responsibility to establish partnerships with
State and local governments and private sector entities to address comprehensively
the problems of homelessness; and
` (13) the results of Federal programs targeted for persons experiencing
homelessness have been positive.
` (b) Purpose- It is the purpose of this Act--
` (1) to create a unified and performance-based process for allocating and
administering funds under title IV;
` (2) to encourage comprehensive, collaborative local planning of housing and
services programs for persons experiencing homelessness;
` (3) to focus the resources and efforts of the public and private sectors on ending
and preventing homelessness;
` {4) to provide funds for programs to assist individuals and families in the transition
from homelessness, and to prevent homelessness for those vulnerable to
homelessness;
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(5) to consolidate the separate homeless assistance programs carried out under
title IV (consisting of the supportive housing program and related innovative
programs, the safe havens program, the section 8 assistance program for single-
room occupancy dwellings, and the shelter plus care program) into a single program
with specific eligible activities;
(6) to allow flexibility and creativity in re-thinking solutions to homelessness,
including alternative housing strategies, outcome-effective service delivery, and the
involvement of persons experiencing homelessness in decision-making regarding
opportunities for their long-term stability, growth, well-being, and optimum self-
sufficiency; and
(7) to ensure that multiple Federal agencies are involved in the provision of
housing, health care, human services, employment, and education assistance, as
appropriate for the missions of the agencies, to persons experiencing homelessness,
through the funding provided for implementation of programs carried out under this
Act and other programs targeted for persons experiencing homelessness, and
mainstream funding, and to promote coordination among those Federal agencies,
including providing funding for a United States Interagency Council on Homelessness
to advance such coordination.'.
SEC. 3. UNITED STATES INTERAGENCY COUNCIL ON HOMELESSNESS.
Title II of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11311 et seq.) is
amended--
(1) in section 20i (42 U.S.C. 11311), by striking the period at the end and inserting
the following: ~ whose mission shall be to develop and coordinate the
implementation of a national strategy to prevent and end homelessness while
maximizing the effectiveness of the Federal Government in contributing to an end to
homelessness in the United States.';
(2) in section 202 (42 U.S.C. 11312)--
(A) in subsection (a)--
(i) by striking ~ (16)' and inserting ~ (19}`; and
(ii) by inserting after paragraph (15) the following:
(16) The Commissioner of Social Security, or the designee of the Commissioner.
(17) The Attorney General of the United States, or the designee of the Attorney
General.
(18) The Director of the Office of Management and Budget, or the designee of the
Director. `;
(B) in subsection (c), by striking ~ annually' and inserting ' 2 times each year';
and
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(C) by adding at the end the following
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(e) Administration- The Assistant to the President for Domestic Policy within the
Executive Office of the President shall oversee the functioning of the United States
Interagency Council on Homelessness to ensure Federal interagency collaboration and
program coordination to focus on preventing and ending homelessness, to increase
access to mainstream programs (as identified in a report by the Government
Accountability Office entitled ~ Homelessness: Barriers to Using Mainstream Programs',
issued July 6, 2000) by persons experiencing homelessness, to eliminate the barriers to
participation in those programs, to implement a Federal plan to prevent and end
homelessness, and to identify Federal resources that can be expended to prevent and
end homelessness.';
(3) in section 203(a) (42 U.S.C. 11313(a)}--
(A) by redesignating paragraphs (1), (2), (3), (4), (5), (6), and (7) as
paragraphs (2), (3), (4), (5), (8), (9), and (10), respectively;
(B) by inserting before paragraph (2), as redesignated by subparagraph (A),
the following:
(1) not later than 1 year after the date of enactment of the Community Partnership
to End Homelessness Act of 2007, develop and submit to the President and to
Congress a National Strategic Plan to End Homelessness;';
(C) in paragraph (5), as redesignated by subparagraph (A), by striking ~ at
least 2, but in no case more than 5' and inserting ~ not less than 5, but in no
ease more than 10'; and
(D) by inserting after paragraph (5), as redesignated by subparagraph (A), the
following:
(6) encourage the creation of State Interagency Councils on Homelessness and the
formulation of multi-year plans to end homelessness at State, city, and county
levels;
(7) develop mechanisms to ensure access by persons experiencing homelessness
to all Federal, State, and local programs for which the persons are eligible, and to
verify collaboration among entities within a community that receive Federal funding
under programs targeted for persons experiencing homelessness, and other
programs for which persons experiencing homelessness are eligible, including
mainstream programs identified by the Government Accountability Office in the 2
reports described in section 102(a)(5)(B);'; and
(4) by striking section 208 (42 U.S.C. 11318) and inserting the following:
SEC. 208. AUTHORIZATION OF APPROPRIATIONS.
'There are authorized to be appropriated to carry out this title $3,000,000 for fiscal year
2008 and such sums as may be necessary for fiscal years 2009, 2010, 2011, and 2012.'.
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SEC. 4. HOUSING ASSISTANCE GENERAL PROVISIONS.
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Subtitle A of title IV of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11361 et
seq.) is amended--
(1} by striking the subtitle heading and inserting the following:
Subtitle A--General Provisions';
(2) by redesignating section 401 (42 U.S.C. 11361) as section 403;
(3} by redesignating section 402 (42 U.S.C. 11362) as section 406;
(4) by inserting before section 403 {as redesignated in paragraph (2)} the following:
SEC. 401. DEFINITIONS.
In this title, the following definitions shall apply:
(1} CHRONICALLY HOMELESS-
{A) IN GENERAL- The term ~ chronically homeless', used with respect to an
individual or family, means an individual ar family who--
(i) is homeless and lives or resides in a place not meant for human
habitation or in an emergency shelter;
(ii) has been homeless and living or residing in a place not meant for
human habitation or in an emergency shelter continuously for at least 1
year or on at least 4 separate occasions in the last 3 years; and
(iii} has an adult head of household with a diagnosable substance use
disorder, serious mental illness, developmental disability (as defined in
section 102 of the Developmental Disabilities Assistance and Bill of Rights
Act of 2000 (42 U.S.C. 15002)), or chronic physical illness or disability,
including the co-occurrence of 2 or more of those conditions.
(2) COLLABORATIVE APPLICANT- The term ~ collaborative applicant' means an
entity that--
(A) carries out the duties specified in section 402;
(B} serves as the applicant for project sponsors who jointly submit a single
application for a grant under subtitle C in accordance with a collaborative
process; and
(C) if the entity is a legal entity and is awarded such grant, receives such
grant directly from the Secretary.
(3) COLLABORATIVE APPLICATION- The term ~ collaborative application' means an
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application for a grant under subtitle Cthat--
' {A) satisfies section 422; and
' (B) is submitted to the Secretary by a collaborative applicant.
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` (4) CONSOLIDATED PLAN- The term `Consolidated Plan' means a comprehensive
housing affordability strategy and community development plan required in part 91
of title 24, Code of Federal Regulations.
` (5) ELIGIBLE ENTITY- The term `eligible entity' means, with respect to a subtitle, a
public entity, a private entity, or an entity that is a combination of public and private
entities, that is eligible to receive directly grant amounts under that subtitle.
` (6) GEOGRAPHIC AREA- The term `geographic area' means a State, metropolitan
city, urban county, town, village, or other nonentitlement area, or a combination or
consortia of such, in the United States, as described in section 106 of the Housing
and Community Development Act of 1974 (42 U.S.C. 5306).
' (7) HOMELESS INDIVIDUAL WITH A DISABTLTTY-
` (A) IN GENERAL- The term `homeless individual with a disability' means an
individual who is homeless, as defined in section 103, and has a disability that-
' (i){I) is expected to be long-continuing or of indefinite duration;
` (II) substantially impedes the individual's ability to live independently;
` (III) could be improved by the provision of more suitable housing
conditions; and
' (IV) is a physical, mental, or emotional impairment, including an
impairment caused by alcohol or drug abuse;
` (ii) is a developmental disability, as defined in section 102 of the
Developmental Disabilities Assistance and Bill of Rights Act of 2000 (42
U.S.C. 15002); or
` (iii) is the disease of acquired immunodeficiency syndrome or any
condition arising from the etiologic agency for acquired immunodeficiency
syndrome.
` (B) RULE- Nothing in clause (iii) of subparagraph (A) shall be construed to
limit eligibility under clause (i) or (ii) of subparagraph (A).
` (8) LEGAL ENTITY- The term `legal entity' means--
' (A) an entity described in section 501(c)(3) of the Internal Revenue Code of
1986 and exempt from tax under section 501(a) of that Code;
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` (B) an instrumentality of State or local government; or
` (C) a consortium of instrumentalities of State or local governments that has
constituted itself as an entity.
` (9) METROPOLITAN CITY; URBAN COUNTY; NONENTITLEMENT AREA- The terms
`metropolitan city', `urban county', and ` nonentitlement area' have the meanings
given such terms in section 102(a) of the Housing and Community Development Act
of 1974 (42 U.S.C. 5302(a)).
` (10) NEW- The term `new', used with respect to housing, means housing for which
no assistance has been provided under this title.
` (11) OPERATING COSTS- The term `operating costs' means expenses incurred by
a project sponsor operating transitional housing or permanent housing under this
title with respect to--
` (A) the administration, maintenance, repair, and security of such housing;
` (B) utilities, fuel, furnishings, and equipment for such housing; or
` {C) coordination of services as needed to ensure long-term housing stability.
` (12) OUTPATIENT HEALTH SERVICES- The term `outpatient health services' means
outpatient health care services, mental health services, and outpatient substance
abuse treatment services.
` (13} PERMANENT HOUSING- The term `permanent housing' means community-
based housing without a designated length of stay, and includes permanent
supportive housing for homeless individuals with disabilities and homeless families
that include such an individual who is an adult.
` (14) PRIVATE NONPROFIT ORGANIZATION- The term `private nonprofit
organization' means an organization--
(A) no part of the net earnings of which inures to the benefit of any member,
founder, contributor, or individual;
(B) that has a voluntary board;
` (C) that has an accounting system, or has designated a fiscal agent in
accordance with requirements established by the Secretary; and
` (D) that practices nondiscrimination in the provision of assistance.
` (15) PROJECT- The term `project', used with respect to activities carried out under
subtitle C, means eligible activities described in section 423(a), undertaken pursuant
to a specific endeavor, such as serving a particular population or providing a
particular resource.
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` (16) PROJECT-BASED- The term `project-based', used with respect to rental
assistance, means assistance provided pursuant to a contract that--
` (A) is between--
` (i) a project sponsor; and
` (ii) an owner of a structure that exists as of the date the contract is
entered into; and
` (B) provides that rental assistance payments shall be made to the owner and
that the units in the structure shall be occupied by eligible persons for not less
than the term of the contract.
` (17) PROJECT. SPONSOR- The term `project sponsor', used with respect to
proposed eligible activities, means the organization directly responsible for the
proposed eligible activities.
` (18) RECIPIENT- Except as used in subtitle B, the term `recipient' means an
eligible entity who--
(A) submits an application for a grant under section 422 that is approved by
the Secretary;
` (B) receives the grant directly from the Secretary to support approved
projects described in the application; and
(C)(i) serves as a project sponsor for the projects; or
` (ii) awards the funds to project sponsors to carry out the projects.
` (19) SECRETARY- The term ~ Secretary' means the Secretary of Housing and Urban
Development.
` {20) SERIOUS MENTAL ILLNESS- The term `serious mental illness' means a severe
and persistent mental illness or emotional impairment that seriously limits a
person's ability to live independently.
` (21) STATE- Except as used in subtitle B, the term `State' means each of the
several States, the District of Columbia, the Commonwealth of Puerto Rico, the
United States Virgin Islands, Guam, American Samoa, the Commonwealth of the
Northern Mariana Islands, the Trust Territory of the Pacific Islands, and any other
territory or possession of the United States.
` (22) SUPPORTIVE SERVICES- The term `supportive services' means the supportive
services described in section 425(c).
` (23) TENANT-BASED- The term `tenant-based', used with respect to rental
assistance, means assistance that allows an eligible person to select a housing unit
in which such person will live using rental assistance provided under subtitle C,
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except that if necessary to assure that the provision of supportive services to a
person participating in a program is feasible, a recipient or project sponsor may
require that the person live--
' (A) in a particular structure or unit for not more than the first year of the
participation; and
' (B} within a particular geographic area for the full period of the participation,
or the period remaining after the period referred to in subparagraph (A).
' (24) TRANSITIONAL HOUSING- The term 'transitional housing' means housing, the
purpose of which is to facilitate the movement of individuals and families
experiencing homelessness to permanent housing within 24 months or such longer
period as the Secretary determines necessary.
' (25) UNIFIED FUNDING AGENCY- The term 'unified funding agency' means a
collaborative applicant that performs the duties described in section 402(f).
SEC. 402. C~LLAB4RATIVE APPLICANTS.
' (a) Establishment and Designation- A collaborative applicant shall be established for a
geographic area by the relevant parties in that geographic area to--
' (1) submit an application for amounts under this subtitle; and
' (2) perform the duties specified in subsection (e) and, if applicable, subsection (f).
' (b) No Requirement To Be a Legal Entity- An entity may be established to serve as a
collaborative applicant under this section without being a legal entity.
' (c} Remedial Action- If the Secretary finds that a collaborative applicant for a
geographic area does not meet the requirements of this section, or if there is no
collaborative applicant for a geographic area, the Secretary may take remedial action to
ensure fair distribution of grant amounts under subtitle C to eligible entities within that
area. Such measures may include designating another body as a collaborative applicant,
or permitting other eligible entities to apply directly for grants.
' (d) Construction- Nothing in this section shall be construed to displace conflict of
interest or government fair practices laws, or their equivalent, that govern applicants for
grant amounts under subtitles B and C.
' (e) Duties- A collaborative applicant shall--
' (1) design a collaborative process for the development of an application under
subtitle C, and for evaluating the outcomes of projects for which funds are awarded
under subtitle B, in such a manner as to provide information necessary for the
Secretary--
' (A) to determine compliance with--
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' (i) the program requirements under section 425; and
' (ii) the selection criteria described under section 427; and
' (B) to establish priorities for funding projects in the geographic area involved;
' (2) participate in the Consolidated Plan for the geographic area served by the
collaborative applicant; and
' (3) ensure operation of, and consistent participation by, project sponsors in a
community-wide homeless management information system for purposes of --
' (A) collecting unduplicated counts of individuals and families experiencing
homelessness;
' (B) analyzing patterns of use of assistance provided under subtitles B and C
for the geographic area involved; and
' (C) providing information to project sponsors and applicants for needs
analyses and funding priorities.
' {f) Unified Funding-
(1) IN GENERAL- In addition to the duties described in subsection (e), a
collaborative applicant shall receive from the Secretary and distribute to other
project sponsors in the applicable geographic area funds for projects to be carried
out by such other project sponsors, if--
' (A) the collaborative applicant--
' (i) applies to undertake such collection and distribution responsibilities in
an application submitted under this subtitle; and
' {ii) is selected to perform such responsibilities by the Secretary; or
' (B) the Secretary designates the collaborative applicant as the unified funding
agency in the geographic area, after--
' (i) a finding by the Secretary that the applicant--
' (I) has the capacity to perform such responsibilities; and
' (II) would serve the purposes of this Act as they apply to the
geographic area; and
(ii) the Secretary provides the collaborative applicant with the technical
assistance necessary to perform such responsibilities as such assistance is
agreed to by the collaborative applicant.
(2) REQUIRED ACTIONS BY A UNIFIED FUNDING AGENCY- A collaborative
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applicant that is either selected or designated as a unified funding agency for a
geographic area under paragraph (1) shall--
' {A) require each project sponsor who is funded by a grant received under
subtitle C to establish such fiscal control and fund accounting procedures as
may be necessary to assure the proper disbursal of, and accounting for, Federal
funds awarded to the project sponsor under subtitle C in order to ensure that
all financial transactions carried out under subtitle C are conducted, and
records maintained, in accordance with generally accepted accounting
principles; and
' {B) arrange for an annual survey, audit, or evaluation of the financial records
of each project carried out by a project sponsor funded by a grant received
under subtitle C.
' (g) Conflict of Interest- No board member of a collaborative applicant may participate in
decisions of the collaborative applicant concerning the award of a grant, or provision of
other financial benefits, to such member or the organization that such member
represents.';
(5) by inserting after section 403 (as redesignated in paragraph (2)) the following:
SEC. 4Q4. TECHNICAL ASSISTANCE.
` (a) Technical Assistance for Project Sponsors- The Secretary shall make effective
technical assistance available to private nonprofit organizations and other
nongovernmental entities, States, metropolitan cities, urban counties, and counties that
are not urban counties that are potential project sponsors, in order to implement
effective planning processes for preventing and ending homelessness, to optimize self-
sufficiency among individuals experiencing homelessness, and to improve their capacity
to become project sponsors.
' {b) Technical Assistance for Collaborative Applicants- The Secretary shall make effective
technical assistance available to collaborative applicants--
' {1) to improve their ability to carry out the duties required under subsections (e)
and (f) of section 402;
' (2) to design and execute outcome-effective strategies for preventing and ending
homelessness in their geographic areas consistent with the provisions of this title;
and
` {3) to design and implement a community-wide process for assessing the
performance of the applicant and project sponsors in meeting the purposes of this
Act .
` {c) Reservation- The Secretary may reserve not more than 1 percent of the funds made
available for any fiscal year for carrying out subtitles B and C, to make available technical
assistance under subsections (a) and (b).
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`SEC. 405. APPEALS.
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' (a) In General- Nat later than 3 months after the date of enactment of the Community
Partnership to End Homelessness Act of 2007, the Secretary shall establish a timely
appeal procedure for grant amounts awarded or denied under this subtitle pursuant to an
application for funding.
' (b) Process- The Secretary shall ensure that appeals procedure established under
subsection (a) permits appeals submitted by--
' {1) collaborative applicants;
' (2) entities carrying out homeless housing and services projects (including
emergency shelters and homelessness prevention programs); and
' (3) homeless planning bodies not established as collaborative applicants.'; and
(6) by inserting after section 406 (as redesignated in paragraph (2)) the following
`SEC. 4t~7. AUTHORIZATION OF APPROPRIATIONS.
'There are authorized to be appropriated to carry out this title $1,800,000,000 for fiscal
year 2008 and such sums as may be necessary for fiscal years 2009, 2010, 2011, and
2012.'.
SEC. 5. EMERGENCY HOMELESSNESS PREVENTION AND SHELTER GRANTS
PROGRAM.
Subtitle B of title IV of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11371 et
seq.) is amended--
(1) by striking the subtitle heading and inserting the following:
`Subtitle B--Emergency Homelessness Prevention and Shelter Grants Program';
(2) by striking section 412 (42 U.S.C. 11372) and inserting the following:
`SEC. 412. GRANT ASSISTANCE.
'The Secretary shall make grants to States and local governments (and to private
nonprofit organizations providing assistance to persons experiencing homelessness, in
the case of grants made with reallocated amounts) for the purpose of carrying out
activities described in section 414.
`SEC. 4i2A. AMOUNT AND ALLOCATION OF ASSISTANCE.
' (a) In General- Qf the amount made available to carry out this subtitle and subtitle C for
a fiscal year, the Secretary shall allocate nationally not less than 10 nor more than 15
percent of such amount for activities described in section 414.
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(b) Allocation- An entity that receives a grant under section 412, and serves an area
that includes 1 or more geographic areas (or portions of such areas) served by
collaborative applicants that submit applications under subtitle C, shall allocate the funds
made available through the grant to carry out activities described in section 414, in
consultation with the collaborative applicants.';
(3) in section 413(b) (42 U.S.C. 11373(b)), by striking ~ amounts appropriated' and
all that follows through ~ for any' and inserting 'amounts appropriated under section
407 and made available to carry out this subtitle for any';
(4) by striking section 414 (42 U.S.C. 11374) and inserting the following:
SEC. 414. ELIGIBLE ACTIVITIES.
'Assistance provided under section 412 may be used for the following activities:
(1) The renovation, major rehabilitation, or conversion of buildings to be used as
emergency shelters.
(2) The provision of essential services, including services concerned with
employment, health, education, family support services for homeless youth, alcohol
or drug abuse prevention or treatment, or mental health treatment, if such essential
services have not been provided by the local government during any part of the
immediately preceding 12-month period, or the use of assistance under this subtitle
would complement the provision of those essential services.
(3) Maintenance,. operation, insurance, provision of utilities, and provision of
furnishings.
(4} Housing relocation or stabilization services for individuals and families at risk of
homelessness, including housing search, mediation or outreach to property owners,
legal services, credit repair, providing security or utility deposits, short- or medium-
term rental assistance, assistance with moving costs, or other activities that are
effective at--
(A) stabilizing individuals and families in their current housing; or
(B) quickly moving such individuals and families to other housing before such
individuals and families become homeless.';
(5) by repealing section 417 (42 U.S.C. 11377); and
(6) by redesignating section 418 as section 417.
SEC. 6. HOMELESS ASSISTANCE PROGRAM.
Subtitle C of title IV of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11381 et
seq.) is amended--
(1) by striking the subtitle heading and inserting the following:
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'Subtitle C--Homeless Assistance Program';
{2) by striking sections 421 through 424 (42 U.S.C. 11381 et seq.) and inserting the
following:
`SEC. 421. PURPOSES.
The purposes of this subtitle are--
' (1) to promote community-wide commitment to the goal of ending homelessness;
(2) to provide funding for efforts by nonprofit providers and State and local
governments to quickly rehouse homeless individuals and families while minimizing
the trauma and dislocation caused to individuals, families, and communities by
homelessness;
(3) to promote access to, and effective utilization of, mainstream programs
identified by the Government Accountability Office in the 2 reports described in
section 102(a)(5)(B) and programs funded with State or local resources; and
' (4) to optimize self-sufficiency among individuals and families experiencing
homelessness.
SEC. 422. COMMUNITY HOMELESS ASSISTANCE PRQGRAM.
' (a) Projects- The Secretary shall award grants, on a competitive basis, and using the
selection criteria described in section 427, to carry out eligible activities under this
subtitle for projects that meet the program requirements under section 426, either by
directly awarding funds to project sponsors or by awarding funds to unified funding
agencies.
(b) Notification of Funding Availability- The Secretary shall release a Notification of
Funding Availability for grants awarded under this subtitle for a fiscal year not later than
3 months after the date of enactment of the appropriate Act making appropriations for
the Department of Housing and Urban Development for the fiscal year.
(c) Applications-
' (1) SUBMISSION TO THE SECRETARY- To be eligible to receive a grant under
subsection {a), a project sponsor or unified funding agency in a geographic area
shall submit an application to the Secretary at such time and in such manner as the
Secretary may require, and containing--
' (A) such information as the Secretary determines necessary--
(i) to determine compliance with the program requirements and selection
criteria under this subtitle; and
(ii) to establish priorities for funding projects in the geographic area.
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` (2) ANNOUNCEMENT OF AWARDS- The Secretary shall announce, within 4 months
after the last date for the submission of applications described in this subsection for
a fiscal year, the grants conditionally awarded under subsection (a) for that fiscal
year.
` (d) Obligation, Distribution, and Utilization of Funds-
` (1) REQUIREMENTS FOR OBLIGATION-
` (A) IN GENERAL- Not later than 9 months after the announcement referred to
in subsection (c)(2), each recipient of a grant announced under such subsection
shall, with respect to a project to be funded through such grant, meet, or cause
the project sponsor to meet, all requirements for the obligation of funds for
such project, including site control, matching funds, and environmental review
requirements, except as provided in subparagraph (C).
` {B) ACQUISITION, REHABILITATION, OR CONSTRUCTION- Not later than 15
months after the announcement referred to in subsection (c)(2), each recipient
of a grant announced under such subsection seeking the obligation of funds for
acquisition of housing, rehabilitation of housing, or construction of new housing
for a grant announced under such subsection shall meet all requirements for
the obligation of those funds, including site control, matching funds, and
environmental review requirements.
` (C) EXTENSIONS- At the discretion of the Secretary, and in compelling
circumstances, the Secretary may extend the date by which a recipient of a
grant announced under subsection (c)(2) shall meet or cause a project sponsor
to meet the requirements described in subparagraphs (A) and (B) if the
Secretary determines that compliance with the requirements was delayed due
to factors beyond the reasonable control of the recipient or project sponsor.
Such factors may include difficulties in obtaining site control for a proposed
project, completing the process of obtaining secure financing for the project, or
completing the technical submission requirements for the project.
` (2) OBLIGATION- Not later than 45 days after a recipient meets or causes a project
sponsor to meet the requirements described in paragraph (1}, the Secretary shall
obligate the funds for the grant involved.
` (3) DISTRIBUTION- A unified funding agency that receives funds through a grant
under this section--
` (A) shall distribute the funds to project sponsors (in advance of expenditures
by the project sponsors); and
` (B) shall distribute the appropriate portion of the funds to a project sponsor
not later than 45 days after receiving a request for such distribution from the
project sponsor.
` (4) EXPENDITURE OF FUNDS- The Secretary may establish a date by which funds
made available through a grant announced under subsection (c)(2) for a homeless
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assistance project shall be entirely expended by the recipient or project sponsors
involved. The Secretary shall recapture the funds not expended by such date. The
Secretary shall reallocate the funds for another homeless assistance and prevention
project that meets the requirements of this subtitle to be carried out, if possible and
appropriate, in the same geographic area as the area served through the original
grant.
` (e} Renewal Funding for Unsuccessful Applicants- The Secretary may renew funding for
a specific project previously funded under this subtitle that the Secretary determines
meets the purposes of this subtitle, and was included as part of a total application that
met the criteria of subsection (c), even if the application was not selected to receive
grant assistance. The Secretary may renew the funding far a period of not more than 1
year, and under such conditions as the Secretary determines to be appropriate.
' (f) Considerations in Determining Renewal Funding- When providing renewal funding for
leasing or rental assistance for permanent housing, the Secretary shall take into account
increases in the fair market rents for modest rental property in the geographic area.
' (g) More Than 1 Application for a Geographic Area- Tf more than 1 collaborative
applicant applies for funds for a geographic area, the Secretary shall award funds to the
collaborative applicant with the highest score based on the selection criteria set forth in
section 427.
SEC. 423. ELIGIBLE ACTIVITIES.
' (a) Tn General- The Secretary may award grants to project sponsors under section 422
to carry out homeless assistance projects that consist of 1 or more of the following
eligible activities:
' (1) Construction of new housing units to provide transitional or permanent housing
to homeless individuals and families.
' (2) Acquisition or rehabilitation of a structure to provide supportive services or to
provide transitional or permanent housing, other than emergency shelter, to
homeless individuals and families.
' (3) Lasing of property, or portions of property, not owned by the recipient or
project sponsor involved, for use in providing transitional or permanent housing to
homeless individuals and families, or providing supportive services to homeless
individuals and families.
' (4) Provision of rental assistance to provide transitional or permanent housing to
homeless individuals and families. The rental assistance may include tenant-based
or project-based rental assistance.
' (5) Payment of operating costs for housing units assisted under this subtitle.
' (6) Provision of supportive services to homeless individuals and families, or
individuals and families who in the prior 6 months have been homeless but are
currently residing in permanent housing.
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` (7) Provision of rehousing services, including housing search, mediation or
outreach to property owners, credit repair, providing security or utility deposits,
rental assistance for a final month at a location, assistance with moving costs, or
other activities that--
` (A) are effective at moving homeless individuals and families immediately into
housing; or
' (B) may benefit individuals and families who in the prior 6 months have been
homeless, but are currently residing in permanent housing,
' (8) In the case of a collaborative applicant that is a legal entity, performance of the
duties described under section 402(e)(3).
` (9) Operation of, participation in, and ensuring consistent participation by project
sponsors in, a community-wide homeless management information system.
` {10) In the case of a collaborative applicant that is a legal entity, payment of
administrative costs related to meeting the requirements described in paragraphs
(1) and (2) of section 402(e), for which the collaborative applicant may use not
more than 3 percent of the total funds made available in the geographic area under
this subtitle for such costs, in addition to funds used under paragraph (10).
` (11) In the case of a collaborative applicant that is a unified funding agency under
section 402{f), payment of administrative costs related to meeting the requirements
of that section, for which the unified funding agency may use not more than 3
percent of the total funds made available in the geographic area under this subtitle
far such costs, in addition to funds used under paragraph (10).
' (12) Payment of administrative costs to project sponsors, for which each project
sponsor may use not more than 5 percent of the total funds made available to that
project sponsor through this subtitle for such costs.
`(b) Minimum Grant Terms-The Secretary may impose minimum grant terms of up to 5
years for new projects providing permanent housing.
` (c) Use Restrictions-
` (1) ACQUISITION, REHABILITATION, AND NEW CONSTRUCTION- A project that
consists of activities described in paragraph (1) or (2) of subsection (a) shall be
operated for the purpose specified in the application submitted for the project under
section 422 for not less than i5 years.
` (2) OTHER ACTIVITIES- A project that consists of activities described in any of
paragraphs (3) through (12) of subsection (a) shall be operated for the purpose
specified in the application submitted for the project under section 422 for the
duration of the grant period involved.
` (3) CONVERSION- If the recipient or project sponsor carrying out a project that
provides transitional or permanent housing submits a request to the collaborative
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applicant or unified funding agency involved to carry out instead a project for the
direct benefit of low-income persons, and the collaborative applicant or unified
funding agency determines that the initial project is no longer needed to provide
transitional or permanent housing, the collaborative applicant or unified funding
agency may recommend that the Secretary approve the project described in the
request and authorize the recipient or project sponsor to carry out that project. If
the collaborative applicant or unified funding agency is the recipient or project
sponsor, it shall submit such a request directly to the Secretary who shall determine
if the conversion of the project is appropriate.
(d) Repayment of Assistance and Prevention of Undue Benefits-
' (1) REPAYMENT- If a recipient (or a project sponsor receiving funds from the
recipient) receives assistance under section 422 to carry out a project that consists
of activities described in paragraph (1} or (2) of subsection (a) and the project
ceases to provide transitional or permanent housing--
' (A) earlier than 10 years after operation of the project begins, the Secretary
shall require the recipient (or the project sponsor receiving funds from the
recipient) to repay 100 percent of the assistance; or
' (B) not earlier than 10 years, but earlier than 15 years, after operation of the
project begins, the Secretary shall require the recipient (or the project sponsor
receiving funds from the recipient) to repay 20 percent of the assistance for
each of the years in the 15-year period for which the project fails to provide
that housing .
' (2) PREVENTION OF UNDUE BENEFITS- Except as provided in paragraph (3), if any
property is used for a project that receives assistance under subsection (a) and
consists of activities described in paragraph (1) or (2) of subsection (a), and the sale
or other disposition of the property occurs before the expiration of the 15-year
period beginning on the date that operation of the project begins, the recipient (or
the project sponsor receiving funds from the recipient) who received the assistance
shall comply with such terms and conditions as the Secretary may prescribe to
prevent the recipient (or a project sponsor receiving funds from the recipient) from
unduly benefitting from such sale or disposition.
' (3) EXCEPTION- A recipient (or a project sponsor receiving funds from the
recipient) shall not be required to make the repayments, and comply with the terms
and conditions, required under paragraph (1) or (2) if--
' (A) the sale or disposition of the property used for the project results in the
use of the property for the direct benefit of very low-income persons;
' (B) all of the proceeds of the sale or disposition are used to provide
transitional or permanent housing meeting the requirements of this subtitle; or
' (C) there are no individuals and families in the geographic area who are
homeless, in which case the project may serve individuals and families at risk
of homelessness under section 1004.
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SEC. 424. FLEXIBILITY INCENTIVES FOR HIGH-PERFORMING
COMMUNITIES.
' (a) Designation as aHigh-Performing Community-
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' {1) IN GENERAL- The Secretary shall designate, on an annual basis, which
collaborative applicants represent high-performing communities.
' (2) CONSIDERATION- In determining whether to designate a collaborative
applicant as ahigh-performing community under paragraph (1}, the Secretary shall
establish criteria to ensure that the requirements described under paragraphs (1)(B)
and (2)(B} of subsection (d) are measured by comparing homeless individuals and
families under similar circumstances, in order to encourage projects in the
geographic area to serve homeless individuals and families with more severe
barriers to housing stability.
' (3) 2-year PHASE IN- In each of the first 2 years after the date of enactment of
this section, the Secretary shall designate not more than i0 collaborative applicants
as high-performing communities.
' (4) EXCESS OF QUALIFIED APPLICANTS- In the event that during the 2-year period
described under paragraph (2) more than 10 collaborative applicants could qualify to
be designated as high-performing communities, the Secretary shall designate the 10
that have, in the discretion of the Secretary, the best performance based on the
criteria described under subsection (d).
' (5) TIME LIMIT ON DESIGNATION- The designation of any collaborative applicant
as ahigh-performing community under this subsection shall be effective only for the
year in which such designation is made. The Secretary, on an annual basis, may
renew any such designation.
' (b) Application To Be aHigh-Performing Community-
' (1) IN GENERAL- A collaborative applicant seeking designation as a high-
performing community. under subsection (a) shall submit an application to the
Secretary at such time, and in such manner as the Secretary may require.
' {2) CONTENT OF APPLICATION- In any application submitted under paragraph (1),
a collaborative applicant shall include in such application--
' (A) a report showing how any money received under this subtitle in the
preceding year was expended; and
' (B) information that such applicant can meet the requirements described
under subsection (d).
' (3) PUBLICATION OF APPLICATION- The Secretary shall--
' (A) publish any report or information submitted in an application under this
section in the geographic area represented by the collaborative applicant; and
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' (B) seek comments from the public as to whether the collaborative applicant
seeking designation as ahigh-performing community meets the requirements
described under subsection (d).
' (c} Use of Funds-
' (1) BY PROJECT SPONSORS IN AHIGH-PERFORMING COMMUNITY- Funds awarded
under section 422(a) to a project sponsor who is located in ahigh-performing
community may be used--
' {A) for any of the eligible activities described in section 423; or
' (B} for any of the eligible activities described in section 1003.
' (2) COMMUNITY HOMELESSNESS PREVENTION FUNDS-
' (A) IN GENERAL- Funds used for activities that are eligible under section 1003
but not under section 423 shall be subject to--
' {i) the matching requirements of section 1008 rather than section 430;
and
(ii} the other program requirements of title X rather than of this subtitle.
' (B) DUTY OF SECRETARY- The Secretary shall transfer any funds awarded
under section 422(a) for activities that are eligible under section 1003 but not
under section 423 from the account for this subtitle to the account for title X.
' (d) Definition of High-Performing Community- For purposes of this section, the term
'high-performing community" means a geographic area that demonstrates through
reliable data that all of the following 4 requirements are met for that geographic area:
' (1) The mean length of episodes of homelessness for that geographic area--
{A) is less than 20 days; or
' (B} for. individuals and families in similar circumstances in the preceding year
was at least 10 percent less than in the year before.
' (2) Of individuals and families--
' (A) who leave homelessness, less than 5 percent of such individuals and
families become homeless again at any time within the next 2 years; or
' (B} in similar circumstances who leave homelessness, the percentage of such
individuals and families who become homeless again within the next 2 years
has decreased by at least 1/5 within the preceding year.
(3) The communities that compose the geographic area have--
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' (A) actively encouraged homeless individuals and families to participate in
homeless assistance services available in that geographic area; and
' {B) included each homeless individual or family who sought homeless
assistance services in the data system used by that community far determining
compliance with this subsection.
(4) If recipients in the geographic area have used funding awarded under section
422(x) for eligible activities described under section 1003 in previous years based on
the authority granted under subsection {c), that such activities were effective at
reducing the number of individuals and families who became homeless in that
community.
' (e) Cooperation Among Entities- A collaborative applicant designated as a high-
performing community under this section shall cooperate with the Secretary in
distributing information about successful efforts within the geographic area represented
by the collaborative applicant to reduce homelessness.' ;
(3) in section 426 (42 U.S.C. 11386)--
(A) by striking subsection (a) and inserting the following:
(a) Site Control- The Secretary shall require that each application include reasonable
assurances that the applicant will own or have control of a site for the proposed project
not later than the expiration of the 12-month period beginning upon notification of an
award for grant assistance, unless the application proposes providing supportive housing
assistance under section 423(a)(3) or housing that will eventually be awned or controlled
by the families and individuals served. An applicant may obtain ownership or control of a
suitable site different from the site specified in the application. If any recipient (or project
sponsor receiving funds from the recipient) fails to obtain ownership or control of the site
within 12 months after notification of an award for grant assistance, the grant shall be
recaptured and reallocated under this subtitle.';
(B) by striking subsection (b) and inserting the following:
' (b) Required Agreements- The Secretary may not provide assistance for a proposed
project under this subtitle unless the collaborative applicant involved agrees--
' (1) to ensure the operation of the project in accordance with the provisions of this
subtitle;
' (2) to monitor and report to the Secretary the progress of the project;
' {3) to ensure, to the maximum extent practicable, that individuals and families
experiencing homelessness are involved, through employment, provision of
volunteer services, or otherwise, in constructing, rehabilitating, maintaining, and
operating facilities far the project and in providing supportive services for the
project;
' (4) to require certification from all project sponsors that--
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' (A) they will maintain the confidentiality of records pertaining to any individual
or family provided family violence prevention or treatment services through the
project;
' (B) that the address or location of any family violence shelter project assisted
under this subtitle will not be made public, except with written authorization of
the person responsible for the operation of such project;
' (C) they will establish policies and practices that are consistent with, and do
not restrict the exercise of rights provided by, subtitle B of title VII, and other
laws relating to the provision of educational and related services to individuals
and families experiencing homelessness;
' {D) they will provide data and reports as required by the Secretary pursuant
to the Act; and
' {E) if the project includes the provision of permanent housing to people with
disabilities, the housing will be provided for not more than--
' (i) 8 such persons in a single structure or contiguous structures;
' (ii) 16 such persons, but only if not more than 20 percent of the units in
a structure are designated for such persons; or
' {iii} more than 16 such persons if the applicant demonstrates that local
market conditions dictate the development of a large project and such
development will achieve the neighborhood integration objectives of the
program within the context of the affected community;
' (5) if a collaborative applicant is a unified funding agency under section 402(f) and
receives funds under subtitle C to carry out the payment of administrative costs
described in section 423(a)(7), to establish such fiscal control and fund accounting
procedures as may be necessary to assure the proper disbursal of, and accounting
for, such funds in order to ensure that all financial transactions carried out with such
funds are conducted, and records maintained, in accordance with generally accepted
accounting principles;
' (6) to monitor and report to the Secretary the provision of matching funds as
required by section 430; and
' (7) to comply with such other terms and conditions as the Secretary may establish
to carry out this subtitle in an effective and efficient manner.';
(C) by redesignating subsection (d) as subsection (c);
(D) in subsection (c) (as redesignated in subparagraph (C)), in the first
sentence, by striking 'recipient' and inserting 'recipient or project sponsor';
(E) by striking subsection (e);
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(F) by redesignating subsections (f}, (g}, and (h), as subsections (d), (e}, and
(f), respectively;
(G) in subsection (e) (as redesignated in subparagraph (F)), in the first
sentence, by striking 'recipient' each place it appears and inserting `recipient
or project sponsor';
(H) by striking subsection (i); and
(I) by redesignating subsection (j) as subsection (g);
(4) by repealing section 429 (42 U.S.C. 11389);
(5) by redesignating sections 427 and 428 (42 U.S.C. 11387, 11388) as sections
431 and 432, respectively; and
(6) by inserting after section 426 the following:
`SEG. 42?. SELECTION CRITERIA.
` (a) In General- The Secretary shall award funds to recipients by a national competition
between geographic areas based on criteria established by the Secretary.
' (b) Required Criteria-
' (1) IN GENERAL- The criteria established under subsection (a) shall include--
(A) the previous performance of the recipient regarding homelessness,
measured by criteria that shall be announced by the Secretary, that shall take
into account barriers faced by individual homeless people, and that shall
include--
(i) the length of time individuals and families remain homeless;
` (ii) the extent to which individuals and families who leave homelessness
experience additional spells of homelessness;
(iii) the thoroughness of grantees in the geographic area in reaching all
homeless individuals and families;
` (iv) overall reduction in the number of homeless individuals and families;
` (v) jobs and income growth for homeless individuals and families;
` (vi} success at reducing the number of individuals and families who
become homeless; and
(vii) other accomplishments by the recipient related to reducing
homelessness;
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` (B) the plan of the recipient, which shall describe--
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` (i} how the number of individuals and families who become homeless will
be reduced in the community;
' (ii) how the length of time that individuals and families remain homeless
will be reduced; and
` (iii} the extent to which the recipient will--
` (I) address the needs of all relevant subpopulations, including--
` (aa) individuals with serious mental illness, addiction disorders, HIV/AIDS and other
prevalent disabilities;
`(bb) families with children;
` (cc) unaccompanied youth;
` (dd} veterans; and
` (ee) other subpopulations with a risk of becoming homeless;
` (II) incorporate all necessary strategies for reducing homelessness,
including the interventions referred to in section 428(d);
` (III) set quantifiable performance measures;
` (IV} set timelines for completion of specific tasks;
` (V) identify specific funding sources for planned activities;
` (VI) identify an individual or body responsible for overseeing
implementation of specific strategies;
` (VII) include a review of local policies and practices relating to
discharge planning from institutions, access to benefits and services
from mainstream government programs, and zoning and land use, to
determine whether such local policies and practices aggravate or
ameliorate homelessness in the geographic area;
` (VIII) include interventions that will help reunify families that have
been split up as a result of homelessness; and
` (IX) incorporate the findings and recommendations of the most
recently completed annual assessments, conducted pursuant to
section 2034 of title 38, United States Code, of the Department of
Veterans Affairs medical centers or regional benefits offices whose
service areas include the geographic area of the recipient;
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` (C) the methodology of the recipient used to determine the priority for funding
local projects under section 422(c)(1), including the extent to which the
priority-setting process--
` (i) uses periodically collected information and analysis to determine the
extent to which each project has resulted in rapid return to permanent
housing for those served by the project, taking into account the severity of
barriers faced by the people the project serves;
` (ii) includes evaluations obtained directly from the individuals and
families served by the project;
' (iii) evaluates whether the population served by the project matches the
priority population for that project;
` (iv} is based on objective criteria that have been publicly announced by
the recipient;
` (v) is open to proposals from entities that have not previously received
funds under this subtitle; and
` (vi) avoids conflicts of interest in the decision-making of the recipient;
' (D) the extent to which the recipient has a comprehensive understanding of
the extent and nature of homelessness in the geographic area and efforts
needed to combat the problem of homelessness in the geographic area;
' (E) the need for the types of projects proposed in the geographic area to be
served and the extent to which the prioritized programs of the recipient meet
such unmet needs;
` (F) the extent to which the amount of assistance to be provided under this
subtitle to the recipient will be supplemented with resources from other public
and private sources, including mainstream programs identified by the
Government Accountability Office in the 2 reports described in section l02(a)
(5)(~);
` (G) demonstrated coordination by the recipient with the other Federal, State,
local, private, and other entities serving individuals and families experiencing
homelessness and at risk of homelessness in the planning and operation of
projects, to the extent practicable;
` (H) the degree to which homeless individuals and families in the geographic
area, including members of all relevant subpopulations listed in subparagraph
(B}(IiI}(I), are able to access--
` (i) public benefits and services for which they are eligible, besides the
services funded under this subtitle, including public schools; and
' (ii) the benefits and services provided by the Department of Veterans
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Affairs;
' (I} the extent to which the opinions and views of the full range of people in
the geographic area are considered, including--
' (i) homeless individuals and families, individuals and families at risk of
homelessness, and individuals and families who have experienced
homelessness;
' (ii) individuals associated with community-based organizations that serve
homeless individuals and families and individuals and families at risk of
homelessness;
' (iii) persons who act as advocates for the diverse subpopulations of
individuals and families experiencing or at risk. of homelessness;
' (iv} relatives of individuals and families experiencing or at risk of
homelessness;
' (v) Federal, State, and local government agency officials, particularly
those officials responsible for administering funding under programs
targeted for individuals and families experiencing homelessness, and other
programs for which individuals and families experiencing homelessness are
eligible, including mainstream programs identified by the Government
Accountability Office in the 2 reports described in section 102(a)(5)(B);
' (vi) local educational agency liaisons designated under section 72X8)(1)
(.7)(ii), or .their designees;
' (vii} members of the business community;
' (viii) members of neighborhood advocacy organizations; and
' (ix) members of philanthropic organizations that contribute to preventing
and ending homelessness in the geographic area of the collaborative
applicant; and
' (.7) such other factors as the Secretary determines to be appropriate to carry
out this subtitle in an effective and efficient manner.
' (2) ADDITIONAL CRITERIA- In addition to the criteria required under paragraph
(i), the criteria established under subsection (a) shall also include the need within
the geographic area far homeless services, determined as follows and under the
following conditions:
' (A) NOTICE- The Secretary shall inform each collaborative applicant, at a time
concurrent with the release of the Notice of Funding Availability for grants
under section 422(b), of the pro rata estimated need amount under this
subtitle for the geographic area represented by the collaborative applicant.
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(B) AMOUNT-
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(i) BASIS- The estimated need amount under subparagraph (A) shall be
based on a percentage of the total funds available, or estimated to be
available, to carry out this subtitle for any fiscal year that is equal to the
percentage of the total amount available for section 106 of the Housing
and Community Development Act of 1974 (42 U.S.C. 5306) for the prior
fiscal year that--
(I) was allocated to all metropolitan cities and urban counties within
the geographic area represented by the collaborative applicant; or
(II} would have been distributed to all counties within such
geographic area that are not urban counties, if the 30 percent portion
of the allocation to the State involved (as described in subsection (d)
(1) of that section 106) for that year had been distributed among the
counties that are not urban counties in the State in accordance with
the formula specified in that subsection (with references in that
subsection to nonentitlement areas considered to be references to
those counties).
(ii) RULE- In computing the estimated need amount under subparagraph
(A), the Secretary shall adjust the estimated need amount determined
pursuant to clause (i) to ensure that--
(I) 75 percent of the total funds available, or estimated to be
available, to carry out this subtitle for any fiscal year are allocated to
the metropolitan cities and urban counties that received a direct
allocation of funds under section 413 for the prior fiscal year; and
(II) 25 percent of the total funds available, or estimated to be
available, to carry out this subtitle for any fiscal year are allocated--
(aa) to the metropolitan cities and urban counties that did not receive a direct allocation of
funds under section 413 for the prior fiscal year; and
(bb) to counties that are not urban counties.
(iii) COMBINATIONS OR CONSORTIA- For a collaborative applicant that
represents a combination or consortium of cities or counties, the estimated
need amount shall be the sum of the estimated need amounts for the
cities or counties represented by the collaborative applicant.
(iv) AUTHORITY OF SECRETARY- The Secretary may increase the
estimated need amount for a geographic area if necessary to provide 1
year of renewal funding far all expiring contracts entered into under this
subtitle for the geographic area.
SEC. 428. ALLCICATICIN AMQUNTS AND INCENTIVES FOR SPECIFIC
ELIGIBLE ACTIVITIES.
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` (a) Minimum Allocation for Permanent Housing for Homeless Individuals and Families
With Disabilities-
` {1) IN GENERAL- From the amounts made available to carry out this subtitle for a
fiscal year, a portion equal to not less than 30 percent of the sums made available
to carry- out subtitle B and this subtitle for that fiscal year shall be used for
permanent housing for homeless individuals with disabilities and homeless families
that include such an individual who is an adult.
` (2) CALCULATION- In calculating the portion of the amount described in paragraph
(1} that is used for activities that are described in paragraph (1}, the Secretary shall
not count funds made available to renew contracts for existing projects under
section 429.
` (3) ADJUSTMENT- The 30 percent figure in paragraph {1) shall be reduced
proportionately based on need under section 427(b)(2) in geographic areas for
which subsection (e) applies in regard to subsection (d)(2)(A).
(4) SUSPENSION- The requirement established in paragraph (1} shall be
suspended for any year in which available funding for grants under this subtitle
would not be sufficient to renew for 1 year existing grants that would otherwise be
funded under this subtitle.
` (5) TERMINATION- The requirement established in paragraph (1) shall terminate
upon a finding by the Secretary that since the beginning of 2001 at least 150,000
new units of permanent housing for homeless individuals and families with
disabilities have been funded under this subtitle.
` (b) Minimum Allocation for Permanent Housing for Homeless Families With Children-
From the amounts made available to carry out this subtitle for a fiscal year, a portion
equal to not less than 10 percent of the sums made available to carry out subtitle B and
this subtitle for that fiscal year shall be used to provide or secure permanent housing for
homeless families with children.
` (c) Funding far Acquisition, Construction, and Rehabilitation of Permanent or
Transitional Housing- Nothing in this subtitle shall be construed to establish a limit on the
amount of funding that an applicant may request under this subtitle for acquisition,
construction, or rehabilitation activities for the development of permanent housing or
transitional housing.
` (d) Incentives for Proven Strategies-
` (1) IN GENERAL- The Secretary shall provide bonuses or other incentives to
geographic areas for using funding under this subtitle for activities that have been
proven to be effective at reducing homelessness generally or reducing homelessness
for a specific subpopulation.
` (2) RULE OF CONSTRUCTION- For purposes of this subsection, activities that have
been proven to be effective at reducing homelessness generally or reducing
homelessness for a specific subpopulation includes--
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' (A) permanent supportive housing for chronically homeless individuals and
families;
' (B) for homeless families, rapid rehousing services, short-term flexible
subsidies to overcome barriers to rehousing, support services concentrating on
improving incomes to pay rent, coupled with performance measures
emphasizing rapid and permanent rehousing and with leveraging funding from
mainstream family service systems such as Temporary Assistance for Needy
Families and Child Welfare services; and
' (C) any other activity determined by the Secretary, based on research and
after notice and comment to the public, to have been proven effective at
reducing homelessness generally or reducing homelessness for a specific
subpopulation.
' (e) Incentives for Successful Implementation of Proven Strategies-
' (1) IN GENERAL- If any geographic area demonstrates that it has fully
implemented any of the activities described in subsection (d) for ali homeless
individuals and families or for all members of subpopulations for whom such
activities are targeted, that geographic area shall receive the bonus or incentive
provided under subsection (d), but may use such bonus or incentive for any eligible
activity under either section 423 or section 1003 for homeless people generally or
for the relevant subpopulation.
' (2) USE OF FUNDS- Bonus or incentive funds awarded under this subsection that
are used for activities that are eligible under section 1003 but not under section 423
shall be subject to--
' (A) the matching requirements of section 1008 rather than section 430; and
' (B) the other program requirements of title X rather than of this subtitle.
(3) DUTY OF SECRETARY- The Secretary shall transfer any bonus or incentive
funds awarded under this subsection for activities that are eligible under section
1003 but not under section 423 from the account for this subtitle to the account for
title X.
SEC. 429. RENEWAL FUNDING AND TERMS OF ASSISTANCE FOR
PERMANENT HOUSING.
' (a) In General- Of the total amount available in the account or accounts designated for
appropriations for use in connection with section 8 of the United States Housing Act of
1937 {42 U.S.C. 1437f), the Secretary shall use such sums as may be necessary for the
purpose of renewing expiring contracts for leasing, rental assistance, or operating costs
for permanent housing.
' (b) Renewals- The sums made available under subsection (a) shall be available for the
renewal of contracts fora 1-year term for rental assistance and housing operation costs
associated with permanent housing projects funded under this subtitle, or under subtitle
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C or F (as in effect on the day before the date of enactment of the Community
Partnership to End Homelessness Act of 2007). The Secretary shall determine whether to
renew a contract for such a permanent housing project on the basis of certification by the
collaborative applicant for the geographic area that--
` (1) there is a demonstrated need for the project; and
(2) the project complies with program requirements and appropriate standards of
housing quality and habitability, as determined by the Secretary.
` (c) Construction- Nothing in this section shall be construed as prohibiting the Secretary
from renewing contracts under this subtitle in accordance with criteria set forth in a
provision of this subtitle other than this section,
SEC. 430. MATCHING FUNDING.
` (a) In General- A collaborative applicant in a geographic area in which funds are
awarded under this subtitle shall specify contributions that shall be made available in the
geographic area in an amount equal to not less than 25 percent of the funds provided to
recipients in the geographic area.
` (b) Limitations on In-Kind Match- The cash value of services provided to the residents
or clients of a project sponsor by an entity other than the project sponsor may count
toward the contributions in subsection (a) anly when documented by a memorandum of
understanding between the project sponsar and the other entity that such services will be
provided.
` (c) Countable Activities- -The contributions required under subsection (a) may consist
of--
` (1) funding for any eligible activity described under section 423; and
` (2) subject to subsection (b), in-kind provision of services of any eligible activity
described under section 423.'.
SEC. 7. RURAL HOUSING STABILITY ASSISTANCE.
Subtitle D of title IV of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11408 et
seq.), as redesignated by section 9, is amended--
(1) by striking the subtitle heading and inserting the following:
'Subtitle D--Rural Housing Stability Assistance Program'; and
(2) in section 491--
(A) by striking the section heading and inserting `rural housing stability grant
program .' ;
(B) in subsection (a)--
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(i) by striking ~ rural homelessness grant program' and inserting ~ rural
housing stability grant program';
{ii) by inserting ~ in lieu of grants under subtitle C and title X' after
eligible organizations`; and
(iii) by striking paragraphs (1), (2), and (3), and inserting the following:
(1) rehousing or improving the housing situations of individuals and families who
are homeless or in the worst housing situations in the geographic area;
(2) stabilizing the housing of individuals and families who are in imminent danger
of losing housing; and
(3) improving the ability of the lowest-income residents of the community to afford
stable housing.';
(C) in subsection (b)(i)--
(i} by redesignating subparagraphs (E), (F), and (G) as subparagraphs (I),
(.J}, and (K), respectively; and
(ii) by striking subparagraph (D) and inserting the following:
(D} construction of new housing units to provide transitional or permanent
housing to homeless individuals and families;
(E) acquisition or rehabilitation of a structure to provide supportive services or
to provide transitional or permanent housing, other than emergency shelter, to
homeless individuals and families;
(F) leasing of property, or portions of property, not owned by the recipient or
project sponsor involved, for use in providing transitional or permanent housing
to homeless individuals and families, or providing supportive services to
homeless individuals and families;
(G) provision of rental assistance to provide transitional or permanent housing
to homeless individuals and families, such rental assistance may include
tenant-based or project-based rental assistance;
(H) payment of operating costs for housing units assisted under this title;';
(D) in subsection (b)(2), by striking ~ appropriated' and inserting ~ transferred';
(E} in subsection (c)--
(i) in paragraph (1)(A), by striking ~ appropriated' and inserting
transferred'; and
(ii) in paragraph (3), by striking ~ appropriated' and inserting
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'transferred';
(F) in subsection (d)--
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(i) in paragraph (5), by striking ~ ;and' and inserting a semicolon;
(ii) in paragraph (6)--
(I) by striking ~ an agreement' and all that follows through ~ families'
and inserting the following: ~ a description of how individuals and
families who are homeless or who have the lowest incomes in the
community will be involved by the organization'; and
(II) by striking the period at the end, and inserting a semicolon; and
(iii) by adding at the end the following:
(7) a description of consultations that took place within the community to ascertain
the most important uses for funding under this section, including the involvement of
potential beneficiaries of the project; and
(8) a description of the extent and nature of homelessness and of the worst
housing situations in the community.`;
(G) by striking subsections (f) and (g) and inserting the following:
(f) Matching Funding-
(1) IN GENERAL- An organization eligible to receive a grant under subsection (a)
shall specify matching contributions that shall be made available in an amount equal
to not less than 25 percent of the funds provided for the project or activity.
(2) LIMITATIONS ON IN-KIND MATCH- The cash value of services provided to the
beneficiaries or clients of an eligible organization by an entity other than the
organization may count toward the contributions in paragraph (1) only when
documented by a memorandum of understanding between the organization and the
other entity that such services will be provided.
(3) COUNTABLE ACTIVITIES- The contributions required under paragraph (i) may
consist of--
(A) funding for any eligible activity described under subsection (b}; and
(B) subject to paragraph (2), in-kind provision of services of any eligible
activity described under subsection (b).
(g) Selection Criteria- The Secretary shall establish criteria for selecting recipients of
grants under subsection (a), including--
(1) the participation of potential beneficiaries of the project in assessing the need
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for, and importance of, the project in the community;
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(2) the degree to which the project addresses the most harmful housing situations
present in the community;
(3) the degree of collaboration with others in the community to meet the goals
described in subsection. (a);
(4} the performance of the organization in improving housing situations, taking
account of the severity of barriers of individuals and families served by the
organization;
(5) for organizations that have previously received funding under this section, the
extent of improvement in homelessness and the worst housing situations in the
community since such funding began;
(6) the need for such funds, as determined by the formula established under
section 427(b)(2); and
(7) any other relevant criteria as determined by the Secretary.';
(H) in subsection (h)--
(i) in paragraph (1)(A), by striking ~ providing housing and other
assistance to homeless persons' and inserting meeting the goals
described in subsection (a)';
(ii) in paragraph (1)(B), by inserting ~ in the worst housing situations' after
homelessness'; and
(iii) in paragraph (2}, by inserting ~ in the worst housing situations' after
homelessness';
(I) in subsection (k)(1), by striking ~ rural homelessness grant program' and
inserting ~ rural housing stability grant program';
(J) in subsection (I}--
(i) by striking the subsection heading and inserting ~ Program Funding- ';
and
(ii) by striking paragraph (1) and inserting the following:
(1) IN GENERAL- The Secretary shall determine the total amount of funding
attributable under both section 427(b}(2) and section 1003(h) to meet the needs of
any geographic area in the Nation that applies for funding under this section. The
Secretary shall transfer any amounts determined under this subsection from the
Community Homeless Assistance Program and the grant program under section
1002 and consolidate such transferred amounts for grants under this section.'; and
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(K} by adding at the end the following
(m) Division of Funds-
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(1) AGREEMENT AMONG GEOGRAPHIC AREAS- If the Secretary receives an
application or applications to provide services in a geographic area under this
subtitle, and also under subtitle C and title X, the Secretary shall consult with all
applicants from the geographic area to determine whether all agree to proceed
under either this subtitle or under subtitle C and title X.
(2) DEFAULT IF NO AGREEMENT- If no agreement is reached under paragraph (1),
the Secretary shall proceed under this subtitle, or under subtitle C and title X,
depending on which results in the largest total grant funding to the geographic
area.'.
SEC. 8. FUNDS TO PREVENT HOMELESSNESS AND STABILIZE HOUSING FOR
PRECARIOUSLY HOUSED INDIVIDUALS AND FAMILIES.
The McKinney-Vento .Homeless Assistance Act (4Z U.S.C. 11301 et seq.) is amended by
inserting after title IX the following:
TITLE X--PREVENTING HOMELESSNESS AND STABILIZING HOUSING FOR
PRECARIOUSLY HOUSED INDIVIDUALS AND FAMILIES
SEC. 1401. PURPOSES.
The purposes of this title are--
(1) to assist local communities to stabilize the housing of individuals and families
who are most at risk of homelessness; and
(2) to improve the ability of publicly funded institutions to avoid .homelessness
among individuals and families leaving the institutions.
SEC. 1002. COMMUNITY HOMELESSNESS PREVENTION AND HOUSING
STABILITY.
(a) Projects- The Secretary shall award grants to recipients, on a competitive basis
using the selection criteria described in section 1006, to carry out eligible activities under
this title, far projects that meet the program requirements established under section
1005.
(b) Notification of Funding Availability- The Secretary shall release a Notification of
Funding Availability for grants awarded under this title for a fiscal year not later than 3
months after the date of enactment of the appropriate Act making appropriations for the
Department of Housing and Urban Development for the fiscal year.
(c) Collaborative Applicant-
' (1) IN GENERAL- A collaborative applicant, as such term is defined in section 401,
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shall for purposes of this title have the same responsibilities as set forth under
section 402.
' (2) DUAL ROLE ENCOURAGED- The Secretary shall encourage the same entity
which serves as a collaborative applicant for purposes of subtitle C of title IV to
serve as a collaborative applicant for purposes of this title.
` (d) Applications-
' (1) SUBMISSION TO THE SECRETARY- A collaborative applicant shall submit an
application to the Secretary at such time and in such manner as the Secretary may
require, and containing such information as the Secretary determines necessary to
determine if the applicant is in compliance with--
' (A} program requirements established under section 1005;
' (B) the selection criteria described in section 1006; and
' (C) the priorities for funding projects in the geographic area under this title.
' (2) COORDINATION WITH COMMUNITY HOMELESS ASSISTANCE PROGRAM- The
Secretary shall, to the maximum extent feasible, coordinate the application process
under this section with the application processes for programs under subtitles B and
C of title IV.
' (3) ANNOUNCEMENT OF AWARDS- The Secretary shall announce, within 4 months
after the last date for the submission of applications described in this subsection for
a fiscal year, the grants conditionally awarded under subsection (a) for that fiscal
year.
' (e) Renewal Funding for Unsuccessful Applicants- The Secretary may renew funding for
a specific project previously funded under this title that the Secretary determines is
effective at preventing homelessness, and was included as part of a total application that
met the criteria of subsection (d)(1), even if the application was not selected to receive
grant assistance. The Secretary may renew the funding for a period of not more than 1
year, and under such conditions as the Secretary determines to be appropriate.
' (f) More Than 1 Application for a Geographic Area- if more than 1 collaborative
applicant applies for funds for a geographic area, the Secretary shall award funds to the
collaborative applicant with the highest score based on the selection criteria set forth in
section 1006.
SEC. iC103. ELIGIBLE ACTIVITIES.
'The Secretary may award grants to qualified recipients under section 1002 to carry out
homeless prevention projects that consist of 1 or more of the following eligible activities:
` (1) Leasing of property, or portions of property, not owned by the recipient
involved, for use in providing short-term ar medium-term housing to people at risk
of homelessness, or providing supportive services to people at risk of homelessness.
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' (2) Provision of rental assistance to provide short-term or.medium-term housing to
people at risk of homelessness. The rental assistance may include tenant-based or
project-based rental assistance.
' (3) Payment of operating costs for housing units assisted under this title.
' (4) Supportive services for people at risk of homelessness.
' (5) Housing relocation or stabilization services, including housing search, mediation
or outreach to property owners, legal services, credit repair, providing security or
utility deposits, rental assistance for a final month at a location, assistance with
moving costs, or other activities that are effective at stabilizing individuals and
families in their current housing or quickly moving them to other housing.
' (6) In the case of a collaborative applicant that is a legal entity payment of
administrative costs related to meeting the requirements of section 1002(c), for
which the collaborative applicant may use not more than 3 percent of the total funds
made available in the geographic area under this subtitle,
' (7) In the case of a collaborative applicant that is a unified funding agency, as such
term is defined under section 402, payment of administrative costs related to
meeting the requirements of serving as such an agency, for which the collaborative
applicant may use not more than 3 percent of the total funds made available in the
geographic area under this title.
SEC. 1004. ELIGIBLE CLIENTS FOR FUNDED PRO]ECTS.
' (a) Rule of Construction- For purposes of this title, 'individuals and families at risk of
homelessness' means individuals and families who meet all of the following criteria
' (1) Have incomes below 20 percent of the median for the geographic area,
adjusted for household size.
' (2) Have moved frequently due to economic reasons, are living in the home of
another due to economic hardship, have been notified that their right to occupy their
current housing or living situation will be terminated, live in severely overcrowded
housing, or otherwise live in housing that has characteristics associated with
instability and increased risk of homelessness as determined by the Secretary.
' (3) Have insufficient resources immediately available to attain housing stability.
' (b) Waiver Authority- The Secretary my waive any of the criteria described in subsection
(a) in a geographic area upon a finding that all individuals and families who meet such
criteria in the geographic area will be served under this title, and that individuals and
families in the geographic area wha do not meet the criteria described in subsection (a)
remain at risk of homelessness.
'SEC. 1005. PROGRAM REQUIREMENTS.
'The program requirements. set forth under section 426 shall apply to projects funded
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under this title.
`SEC. 1006. SELECTION CRITERIA.
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' (a} In General- The Secretary shall award funds to recipients by a national competition
based on criteria established by the Secretary.
' (b) Required Criteria- The criteria established under subsection (a) shall include--
' (1) the previous performance of the recipient regarding stabilizing housing and
preventing homelessness, measured by criteria that shall be announced by the
Secretary, that shall take into account barriers faced by individuals and families at
risk of homelessness;
' (2) the plan of the recipient, which shall describe--
' {A} how the number of individuals and families who become homeless will be
reduced in the community; and
' {B} how the length of time that individuals and families remain homeless will
be reduced;
' (3) all of the criteria established under section 427(b)(1)(B){iii);
' (4) the methodology used by the recipient to determine the priority for funding
local projects under section 1002(d)(1), including use of the same methodology
used in section 427(b)(1)(C);
' (5) the degree to which services are to be provided by the recipient to those
individuals and families most at risk of homelessness; and
' (6) all of the criteria established under--
' (A) subparagraphs (D) through (J) of subsection (b){1) of section 427; and
(B) subsection (b}(2) of section 427.
SEC. 1007. ELIGIBLE GRANT RECIPIENTS.
'The Secretary may make grants under this title to States, local governments, or
nonprofit corporations.
SEC. 1008. MATCHING REQUIREMENT.
' (a} In General- A collaborative applicant in a geographic area in which funds are
awarded under this title shall specify contributions that shall be made available in that
geographic area, in an amount equal to not less than 25 percent of the Federal funds
provided under the grant, except that when services are provided to individuals and
families who are or were within the past 2 years residents of institutions or systems of
care funded, in whole or in part, by State or local government, including prison, jail, child
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welfare, and hospitals (including mental hospitals), for periods exceeding 2 years, then
the collaborative applicant shall specify contributions that shall be made available in an
amount equal to not less than 60 percent of the Federal funds provided under the grant.
(b) Limitations on In-Kind Match- The cash value of services provided to the residents
or clients of a recipient of a grant under this title by an entity other than the recipient
may count toward the contributions in subsection (a) only when documented by a
memorandum of understanding between the recipient and the other entity that such
services will be provided.
' (c} Countable Activities- -The contributions required under subsection (a) may consist
of--
(1) funding for any eligible activity described under section 423 or section 1003;
and
` (2) subject to subsection (b), in-kind provision of services of any eligible activity
described under section 423 or section 1003.
`SEC. 1009. REGULATIONS.
`The Secretary shall promulgate regulations to carry out this title.
SEC. 1010. REPORT TO CONGRESS.
`Nat later than 1 year after the date of enactment of the Community Partnership to End
Homelessness Act of 2007, the Secretary shall report to Congress on the
accomplishments of the program in this title.
SEC. 1011. AUTHORIZATION OF APPROPRIATIONS.
`There are authorized to be appropriated to carry out this title $250,000,000 for fiscal
year 2008, and such sums as may be necessary for fiscal years 2009, 2010, 2011, and
2012.'.
SEC. 9. REPEALS AND CONFORMING AMENDMENTS.
(a} Repeals- Subtitles D, E, and F of title IV of the McKinney-Vento Homeless Assistance
Act (42 U.S.C. 11391 et seq., 11401 et seq., and 11403 et seq.) are repealed.
(b) Conforming Amendment- Subtitle G of title IV of the McKinney-Vento Homeless
Assistance Act (42 U.S.C. 11408 et seq.) is amended by redesignating subtitle G as
subtitle D.
SEC. 10. EFFECTIVE DATE.
This Act shall take effect 6 months after the date of enactment of this Act.
~FND
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~~-~o~~~s r~ar~,~ I ~:o~t~ct I Accessi~afl~t~ I ~~ I L~s~,~~~
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Agenda Item 22
-._ •
~. Reviewed:
-~ ~ ~ c---
AGENDA REPORT City Manager
Finance Director N/A
~~~
MEETING DATE: SEPTEMBER 4, 2007
TO: WILLIAM A. HUSTON, CITY MANAGER
FROM: COMMUNITY DEVELOPMENT DEPARTMENT
SUBJECT: LEGISLATIVE REPORT - MOBILEHOME PARK LEGISLATION
SUMMARY:
This legislative report summarizes four bills pertaining to mobile home parks: Assembly
Bill (AB) 1111, AB 1309, AB 1542, and Senate Bill (SB) 981.
AB 1111 (DeSaulnier) would require the approval of the majority of the residents of a
mobilehome park to change any age restrictions on the park.
AB 1309 (Charles Calderon) would allow the landlord of a mobilehome park in a
community with mobilehome rent control to increase the mobilehome rent to the market
rate rent when a unit becomes vacant and a new tenant occupies the unit.
AB 1542 (Evans) would maintain local rent control measures on mobilehome spaces that
are not purchased when a mobilehome park converts to resident ownership.
SB 981 (Padilla) would require the management of a mobilehome park to maintain the
park's common facilities with funds acquired through rent and not other fees.
RECOMMENDATION:
Pleasure of the City Council
FISCAL IMPACT:
There are no significant fiscal impacts associated with this action.
DISCUSSION:
At the August 7, 2007, meeting, Mayor Bone requested that Assembly Bill (AB) 1111,
Assembly Bill (AB) 1309, Assembly Bill (AB) 1542, and Senate Bill (SB) 981 be agendized
for the Council's consideration.
City Council Report
Mobilehome Park Legislation
September 4, 2007
Page 2
AB 1111 can be summarized as follows:
• Prohibits the mobilehome park management from amending a rule or regulation
that limits residency or tenancy to individuals 55 years or older as authorized by
federal law unless a majority of the residents approve the change.
• Allows a local jurisdiction to enact an ordinance prohibiting the management of a
mobilehome park from amending an existing rule that limits the residency of a
mobilehome park to 55 years of age or older.
Status of AB 1111: In Assembly Committee on Housing and Community Development.
AB 1309 can be summarized as follows:
• Makes legislative findings regarding the negative effects of stringent local rent
control ordinances on the quantity and quality of housing in mobilehome parks
and the need to include vacancy decontrol in local rent control ordinances.
• Provides if the tenancy in a mobilehome park is voluntarily terminated the
management may set the initial rent for a space when there is a change in
ownership of the mobilehome on that space.
• Allows the park management until January 1, 2011, to set the initial rent in
accordance with one of two specified formulas.
• Allows the park management to set the initial rent to market rate after January 1,
2011.
• Provides, after an initial rent is set, an increase in rent is subject to regulations
adopted by the local legislative agency.
• Exempts changes in ownership that result from the death of a mobilehome owner
where the deceased tenant's spouse takes ownership and occupancy of the
mobilehome.
Status of AB 1309: In Assembly Committee on Judiciary.
AB 1542 can be summarized as follows:
• Provides that the limits on rent increases that may be charged non-purchasing
residents shall only apply in the absence of local rent control.
• Maintains local rent control measures on spaces that are not purchased when a
mobilehome park converts to resident ownership.
City Council Report
Mobilehome Park Legislation
September 4, 2007
Page 3
Status of AB 1542: In Senate Committee on Appropriations.
Permits the local government to review matters beyond compliance with the law
on avoiding the economic displacement of residents.
SB 981 can be summarized as follows:
• Requires the rental agreement for a mobilehome to specify that the management
must maintain existing physical improvements through rents and not through
other fees.
• Specifies that the provisions of the bill are not intended to preempt or control an
existing local mobilehome rent control ordinance which includes provisions for
fees or charges for maintenance of existing common area facilities or existing
park infrastructure.
Status of SB 981: In Assembly.
~~
Scott Reekstin
Senior Planner
1 ~
Elizabeth A. Binsack
Community Development Director
Attachment: Assembly Bill No. 1111
Assembly Bill No. 1309
Assembly Bill No. 1542
Senate Bill No. 981
S:\Cdd\CCREPORT\mobilehome park legislation 2007.doc
CALIFORNIA LEGISLATURE-2007-OS REGULAR SESSION
ASSEMBLY BILL No. 1111
Introduced by Assembly Member DeSaulnier
(Coauthor: Assembly Member Lieber)
(Coauthor: Senator Padilla)
February 23, 2007
An act to amend Section 798.25 of the Civil Code, relating to
mobilehomes.
LEGISLATIVE COUNSEL'S DIGEST
AB 1111, as introduced, DeSaulnier. Mobilehome parks: rules and
regulations.
The Mobilehome Residency Law provides that when the management
of a mobilehome park proposes an amendment to the park's rules and
regulations, the management is required to meet and consult with the
homeowners in the park, their representatives, or both, after providing
written notice to all of the homeowners 10 days or more before the
meeting. Under that law, following the meeting and consultation with
homeowners, the amendment to the park's rules and regulations may
be implemented as to a homeowner with the consent of that homeowner,
or without the homeowner's consent upon written notice of not less
than 6 months, except as specified.
This bill would prohibit the management, if an existing park rule or
regulation limits residency or tenancy to individuals 55 years of age
and older, from amending that rule or regulation to permit residency or
tenancy regardless of age unless that amendment is approved by a
majority of residents of the park, as specified. The bill would also permit
a local public agency with authority over the jurisdiction where the park
is located to prohibit the management from amending an existing park
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AB 1111
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rule or regulation that limits residency or tenancy to individuals 55
years of age and older, as specified.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
The people of the State of California do enact as follows:
1 SECTION 1. Section 798.25 of the Civil Code is amended to
2 read:
3 798.25. (a) Except as provided in subdivision (d), when the
4 management proposes an amendment to the park's rules and
5 regulations, the management shall meet and consult with the
6 homeowners in the park, their representatives, or both, after written
7 notice has been given to all the homeowners in the park 10 days
8 or more before the meeting. The notice shall set forth the proposed
9 amendment to the park's rules and regulations and shall state the
10 date, time, and location of the meeting.
11 (b) Except as provided in subdivision (d), following the meeting
12 and consultation with the homeowners, the noticed amendment to
13 the park's rules and regulations may be implemented, as to any
14 homeowner, with the consent of that homeowner, or without the
15 homeowner's consent upon written notice of not less- than six
16 months, except for regulations applicable to recreational facilities;
17 -.~ that may be amended without homeowner consent upon
18 written notice of not less than 60 days.
19 (c) Written notice to a homeowner whose tenancy commences
20 within the required period of notice of a proposed amendment to
21 the park's rules and regulations under subdivision (b) or (d) shall
22 constitute compliance with this section where the written notice
23 is given before the inception of the tenancy.
24 (d) When the management proposes an amendment to the park's
25 rules and regulations mandated by a change in the law, including,
26 but not limited to, a change in a statute, ordinance, or governmental
27 regulation, the management may implement the amendment to the
28 park's rules and regulations, as to any homeowner, with the consent
29 of that homeowner or without the homeowner's consent upon
30 written notice of not less than 60 days. For purposes of this
31 subdivision, the management shall specify in the notice the citation
32 to the statute, ordinance, or regulation, including the section
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1 number, that necessitates the proposed amendment to the park's
2 rules and regulations.
3 (e) An amendment to the park's rules and regulations that
4 creates a new fee payable by the homeowner and that has not been
5 expressly agreed upon by the homeowner and management in the
6 written rental agreement or lease, shall be void and unenforceable.
7 (~ If an existing park rule or regulation limits residency or
8 tenancy to individuals SS years of age and older, as authorized by
9 federal law and regulations implementing that law, management
10 shall not amend that rule and regulation to permit residency or
11 tenancy regardless of age unless that amendment is approved by
12 a majority of residents of the park.
13 (g) A local public agency with authority over the jurisdiction
14 where the park is located may, by ordinance, prohibit the
15 management from amending an existing park rule or regulation
16 that limits residency or tenancy to individuals SS years of age and
17 older.
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AB 1111 Assembly Bill - Status
CURRENT BILL STATUS
MEASURE A.B. No. 1111
AUTHOR(S) DeSaulnier (Coauthor: Lieber) (Coauthor: Senator
Padilla) .
TOPIC Mobilehome parks: rules and regulations.
HOUSE LOCATION ASM
TYPE OF BILL
Active
Non-Urgency
Non-Appropriations
Majority Vote Required
Non-State-Mandated Local Program
Non-Fiscal
Non-Tax Levy
Page 1 of 1
LAST HIST. ACT. DATE: 05/09/2007
LAST HIST. ACTION In committee: Set, first hearing. Hearing canceled at
the request of author.
COMM. LOCATION ASM HOUSING AND COMMUNITY DEVELOPMENT
TITLE An act to amend Section 798.25 of the Civil Code,
relating to mobilehomes.
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AB 1111 Assembly Bill - History
COMPLETE BILL HISTORY
BILL NUMBER A.B. No. 1111
AUTHOR DeSaulnier
TOPIC Mobilehome parks: rules and regulations.
TYPE OF BILL
BILL HISTORY
2007
Active
Non-Urgency
Non-Appropriations
Majority Vote Required
Non-State-Mandated Local Program
Non-Fiscal
Non-Tax Levy
Page 1 of 1
May 9 In committee: Set, first hearing. Hearing canceled at the request
of author.
Apr. 11 In committee: Hearing postponed by committee.
Mar. 15 Referred to Com. on H. & C.D.
Feb. 26 Read first time.
Feb. 25 From printer. May be heard in committee March 27.
Feb. 23 Introduced. To print.
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BILL ANALYSIS
AB 1111
Page 1
Date of Hearing: May 9, 2007
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Lori Saldana, Chair
AB 1111 (DeSaulnier) - As Introduced: February 23, 2007
SUBJECT Mobilehome parks: rules and regulations
SUMM_A__RY__ Requires a vote of the residents of a mobilehome park
to change the age restrictions on the park. Specifically, _thi_s
bill
1)Prohibits the park management from amending a rule or
regulation that limits residency or tenancy to individuals 55
years or older as authorized by federal law unless a majority
of the residents approve the change.
2)Allows a local jurisdiction to enact an ordinance prohibiting
the management of a park from amending an existing rule that
limits the residency of a park to 55 years of age or older.
EXISTING LAW:
1)The Fair Housing Act (FHA) prohibits housing discrimination on
the basis of race, color, religion, sex, disability, familial
status, and national origin. Provides a property that excludes
families with children does not violate the FHA exemption to
senior housing if at least 80% of its occupied units have at
least one occupant who is 55 or older and that it publishes
and follows policies and procedures which demonstrate intent
to be 55 and older housing (Sec. 800. [42 U.S.CJ).
2)Requires the park management, after giving 10 days written
notice, to meet and consult with the residents of a mobilehome
park when proposing an amendment to the rules and regulations
of the park. Provides that amendments that have the
homeowners consent can take effect immediately and those
without consent can take effect upon written notice of not
less than six months. Provides amendment to the regulation of
recreational facilities without the homeowners consent can
take effect after 60 days notice (Civil Code Section 798.25).
3)Allows the management of a mobilehome park to require a buyer
of a mobilehome to comply with any rule or regulation limiting
residency based on age requirements for housing for older
AB__llll
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persons provided the rule complies with the federal FHA.
(Civil Code Section 798.76)
FISCAL EFFECT None
COMMENTS.
Background
There are approximately 9,822 mobilehome parks and manufactured
communities in the state. There are an estimated 700,000
residents living in these parks and in the majority of parks
mobilehome residents own their homes but rent the spaces on
which their homes are installed from the park on a
month-to-month or long-term lease agreement.
Existing law requires the park management of a mobilehome park
to inform and consult with the residents of a mobilehome park
before amending the park rules or regulations. The park rules
and regulations govern a variety of issues however the
management is not required to gain the approval of tenants prior
to making a rule change. If residents give their consent to a
rule change then it can take effect immediately. If residents
oppose an amendment then it takes effect 6 months after the park
management notices the residents of the change except in the
case of regulations regarding recreational facilities which can
take effect after 60 days. In the case of a change in the age
requirements of a mobilehome park, under existing law, if the
park management did not receive the consent of the residents the
change would go into effect six months after the residents were
noticed of the amendment to the rules.
Federal Fair Housing Act
The Fair Housing Act (FHA) prohibits housing discrimination on
the basis of race, color, religion, sex, disability, familial
status, and national origin. In order to achieve an exemption
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AB 1111 Assembly Bill - Bill Analysis
under the FHA, and exclude families with children, a property
must meet the FHA's requirements that at least 80~ of its
occupied units have at least one occupant who is 55 or older,
and that it publish and follow policies and procedures which
demonstrate intent to be 55 and older housing.
Purpose of the bill:
_ AB 11__1__1
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Page 3
According to the author, a growing number of mobilehome park
owners throughout California are abusing existing law to
unilaterally amend park rules and regulations to change the
parks to "all ages" communities. Mobilehome owners of retirement
age have purposely sought out 55 and older communities so that
they could invest in homes in communities where their neighbors
would also be seniors and where they could enjoy the quiet years
of retirement. According to the sponsor, because some park
owners originally developed their parks as retirement
communities, advertised them as retirement communities and
stated in their written park rules that the community would be
limited to persons 55 years of age and older; seniors have
reasonably relied upon such representations when deciding to
purchase a home in those communities.
Arguments in suppor_t__
The City of American Canyon which recently placed a moratorium
on any changes in the age restrictions on mobilehome parks
writes in support of the bill, AB 1111 "would allow a city?to
best determine what type of residency fits the character and
needs of their local community." From a health and safety
perspective the local government agency should have the right to
review the design and layout of mobilehome parks to determine
whether they can safely accommodate a change in tenancy. The
City offers the example of two parks located next to each other
that have very different design and layout. The family tenancy
park has a playground for children, wider streets and
considerable space between the units. The senior-only park has
no playground, narrow streets and limited space between
individual mobilehomes. The City argues there is a legitimate
public policy rationale that would require the participation of
both the local government and the tenants to ensure there are no
health and safety policy concerns that would occur from a
conversion of a park.
Arguments n_opposition
Western Manufactured Housing Association (WMA) argues that based
on the decision in the case of United States vs. City of
Hayward, SB 1111 violates the FHA. In the United States. vs.
City of Hayward a park owner decided to open the park to
families with children, the park had previously been an "adult
_AB__1 l_l l
Page 9
only" park in which residents were required to be at least 18
years old. The City of Hayward's Rent Control Board Office
reduced the amount of rent the park could collect based on a
reduction in services to adult residences. The United States
ruled against Hayward claiming the City was coercing and
interfering with the park owner's efforts to aid families and
children to enjoy their protected rights under FHA. WMA argues
the court determined that the ability to qualify for the
prohibition of discrimination against families with children
turns upon the intent of the property owner not the intent of
the local government.
United States v_s._City__o_f Hay_wa_rd
In the case of the United States vs. the City of Hayward, the
seniors living in the park petitioned the City of Hayward for a
rent reduction claiming that opening the park to families with
children amounted to a reduction in services entitling them to a
reduction in rent. The City of Hayward determined the seniors
were correct and authorized a rent reduction. The park owner
filed a housing discrimination claim with Department of Housing
& Urban Development (HUD) and the United States filed suit
against the City. The City of Hayward contended that FHA does
not apply to the property because it satisfies the requirement
for an exemption for housing for older persons. The court
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AB 1111 Assembly Bill -Bill Analysis
determined that only the City of Hayward violated the FHA by
attempting to coerce the park owner through a reduction in rent
through the rent ordinance to keep the park for seniors. The
court determined that the City's ordinance was not
"discriminatory on its face".
Attorney_General Opinion 04-704:
A 2009 California Attorney General's (AG) opinion requested, by
Senator Morrow, concluded that a city may adopt a zoning
ordinance or issue a conditional use permit that limits a
specified parcel of land to use as a mobilehome park for senior
citizens. The opinion interpreted Health and Safety Code
Section 18300 as a grant of authority for a city to enact zoning
ordinances and issue conditional use permits "
establishing?senior mobilehome parks." The AG opined that
notwithstanding the prohibition on age discrimination contained
in the Planning and Zoning Law, a city may adopt a zoning
ordinance or issue a conditional use permit that limits a
specified parcel of land to use as a mobilehome park for senior
AB__1111
Page 5
_-
citizens pursuant to Health & Safety Code Section 18300. Health
& Safety Code Section 18300 states nothing prevents a city from
exercising its police powers from establishing certain zones for
senior mobilehome parks.
Staff Comments
The committee may wish to consider that although seniors may
move into a park because it is currently a senior-only park and
they desire to live in that type of community that there is
nothing currently in the Mobilehome Residency Law that would
prevent the park owner from changing the rules. Therefore,
nothing in existing law would give seniors currently living in
restricted parks an expectation that the park would remain a
senior-only park.
Additionally, the committee may wish to consider in light of the
affordable housing crisis facing the state and the fact that an
additional 500,000 people were added to the state last year, if
it is good public policy to eliminate what could be a source of
affordable housing for low-income families? The committee may
wish to consider that senior housing is usually much easier to
get approval for in communities. AB 1111 may have the effect of
further reducing affordable housing for families.
The committee may wish to consider how this bill would impact
seniors who have grandchildren living with them? Would
restricting the age of residents to 55-years or older result in
the fracture of families?
REGISTERED SUPPORT / OPPOSITION
Support
Golden State Manufactured-Home Owners League (Sponsor)
City of American Canyon
13 mobilehome owners (Pacific Palisades)
148 mobilehome owners and residents (Meadows Mobile Home Park,
Riverside)
Op~psition
California Mobilehome Parkowners Alliance
Western Manufactured Housing Association (WMA)
AB__1 l l 1
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Analysis Prepared by Lisa Engel / H. & C.D. / (916) 319-2085
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AB 1111 Assembly Bill -Bill Analysis
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AMENDED IN ASSEMBLY APRIL 30, 2007
AMENDED IN ASSEMBLY MARCH 29, 2007
CALIFORNIA LEGISLATURE-200]-OS REGULAR SESSION
ASSEMBLY BILL No. 1309
Introduced by Assembly Member Charles Calderon
February 23, 2007
An act to add Section 798.46 to the Civil Code, relating to
mobilehomes.
LEGISLATIVE COUNSEL'S DIGEST
AB 1309, as amended, Charles Calderon. Mobilehomes: rent control.
The Mobilehome Residency Law provides a comprehensive body of
laws governing the terms and conditions of residency in mobilehome
parks. That law provides for the establishment and observance of rules
and regulations applicable to various aspects of mobilehome residences.
That law also requires that a city, county, or city and county that
administers a rent control measure to permit the management, as defined,
to separately charge a homeowner for certain fees and costs imposed
by a specified governmental entity on the space rented by the
homeowner, and makes this provision applicable to fees and charges
first imposed on or after January 1, 1995.
This bill would permit the management of a mobilehome park to set
the initial rent for a mobilehome space
subject to specked
limitations. The bill would provide that after the initial rent is set
pursuant to these provisions, an increase in the rent shall be subject to
any rent increase regulations adopted by the local agency with
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AB 1309
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jurisdiction over the mobilehome park. The bill would also make related
legislative findings and declarations.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
The people of the State of California do enact as follows:
1 SECTION 1. The Legislature finds and declares all of the
2 following:
3 (a) The availability of housing is a matter of vital statewide
4 importance and attaining decent housing and a suitable living
5 environment for every Californian is a priority of the highest order.
6 (b) Attaining these goals requires the cooperative participation
7 of government and the private sector in an effort to expand housing
8 opportunities and accommodate the housing needs of Californians
9 of all economic levels.
10 (c) Local and state government have a responsibility to use the
11 powers vested in government to facilitate housing opportunities
12 and protect the financial viability of safe and decent housing for
13 Californians of all economic levels.
14 (d) Leading academic and economic experts agree that rent
15 controls cause reductions in the quality and quantity of housing,
16 are inefficient governmental policies, fail to secure affordable
17 housing, and damage some of the low-income renters these rent
18 controls are designed to protect.
19 (e) The Legislature recognizes the damaging effect of stringent
20 rent controls by enacting provisions related to vacancy decontrol
21 in 1987 and 1995. In order to implement vacancy decontrol, the
22 Legislature prohibited commercial rent control and required all
23 apartment rent control ordinances to permit owners to raise rents
24 to market rates for new residents while allowing for the imposition
25 of rent controls for the new tenancies.
26 (f) Providing balanced incentives promotes the state's interest
27 in preserving the number of mobilehomes.
28 (g) Over 100 local governments in this state have rent control
29 ordinances for spaces in mobilehome parks and of these, 20 percent
30 recognize the positive, balanced effect of vacancy decontrol by
31 including vacancy decontrol in their rent control ordinances.
32 (h) The existing number of mobilehome parks is a vital
33 component in the state's housing market and the lack of balance
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or limits on local mobilehome rent control ordinances jeopardizes
the financial viability of parks and diminishes the quality and
quantity of mobilehome park spaces available for rent.
SEC. 2. Section 798.46 is added to the Civil Code, to read:
798.46. (a) Notwithstanding any contrary provision of law, if
a tenancy is voluntarily terminated by the resident or terminated
pursuant to Article 6 (commencing with Section 798.55), the
management may set the initial rent for a mobilehome space _.-
.,
subject to the following:
(1) If the initial rental rate is controlled by an ordinance or
charter provision in effect on January 1, 2008, the management
may set the initial rental rate in an amount not to exceed the
greater of the following:
(A) Twenty percent in excess of the rental rate in effect
immediately preceding the tenancy.
(B) Seventy percent of the prevailing market rent for comparable
units, as defined in an appraisal conducted in accordance with
nationally recognized professional appraisal standards.
(2) On or after January 1, 2011, or if paragraph (1) does not
apply, the management may set the initial rental rate at market
rates.
(b) After the initial rent is set pursuant to subdivision (a), an
increase in the rent shall be subject to any rent increase regulations
adopted by the local agency with jurisdiction over the mobilehome
park.
(c) This section shall not apply to a change in ownership due
to the death of a mobilehome owner when the deceased tenant's
spouse takes over the ownership and occupancy of the mobilehome.
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AB 1309 Assembly Bill - .History Page 1 of 1
COMPLETE BILL HISTORY
BILL NUMBER A.B. No. 1309
AUTHOR Charles Calderon
TOPIC Mobilehomes: rent control.
TYPE OF BILL
BILL HISTORY
2007
Active
Non-Urgency
Non-Appropriations
Majority Vote Required
Non-State-Mandated Local Program
Non-Fiscal
Non-Tax Levy
May 9 From committee: Do pass, and re-refer to Com. on JUD. Re-referred.
(Ayes 4. Noes 2.) (May 9).
May 1 Re-referred to Com. on H. & C.D.
Apr. 30 From committee chair, with author's amendments: Amend, and re-refer
to Com. on H. & C.D. Read second time and amended.
Apr. 25 In committee: Set, first hearing. Hearing canceled at the request
of author.
Apr. 9 Re-referred to Com. on H. & C.D.
Mar. 29 Referred to Coms. on H. & C.D. and JUD. From committee chair,
with author's amendments: Amend, and re-refer to Com. on H. & C.D.
Read second time and amended.
Feb. 26 Read first time.
Feb. 25 From printer. May be heard in committee March 27.
Feb. 23 Introduced. To print.
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AB 1309 Assembly Bill - Bill Analysis
BILL ANALYSIS
A_B_13.0. 9
Page 1
Date of Hearing: May 9, 2007
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Lori Saldana, Chair
AB 1309 (Charles Calderon) - As Amended: April 30, 2007
SUBJECT Mobilehomes: rent control
SUMMARY Establishes vacancy decontrol for mobilehomes sold in
mobilehome parks in jurisdictions with local rent control
ordinances. Specifically, this bill
1)Makes legislative findings regarding the negative effects of
stringent local rent control ordinances on the quantity and
quality of housing in mobilehome parks and the need to include
vacancy decontrol in local rent control ordinances.
2)Provides if the tenancy in a mobilehome park is voluntarily
terminated the management may set the initial rent for a space
when there is a change in ownership of the mobilehome on that
space.
3)Allows, until January 1, 2011, the park management to set the
initial rent not to exceed the greater of either of the
following: 20o in excess of the rental rate in effect
immediately proceeding tenancy or 700 of prevailing market
rent for comparable units as defined in an appraisal in
accordance with nationally recognized professional appraisal
standards.
9)Allows the park management to set the initial rent to market
rate after January 1, 2011.
5)Provides, after an initial rent is set, an increase in rent is
subject to regulations adopted by the local legislative
agency.
6)Exempts changes in ownership that result from the death of a
mobilehome owner where the deceased tenant's spouse takes
ownership and occupancy of the mobilehome.
EXISTING LAW:
1)The Costa-Hawkins Rental Housing Act (Act), which excludes
mobilehome parks, prohibits "vacancy control" rent control
_AB 1309
Page 2
laws for residential real property. It requires a local rent
control law for residential real property to permit the
landlord to raise the rent upon the termination of a prior
tenancy and creation of a new one, where the prior tenancy was
"voluntarily vacated." However, this owner's right to
"decontrol" does not apply if the prior tenancy had been
terminated by the owner on a 30-day notice, or was terminated
pursuant to a change in the terms of tenancy notices pursuant
to Civil Code Section 827, other than a change permitted by
law in the amount of the rent or fees (Civil Code Section
1959.50 et. seq.).
2)Exempts all newly constructed mobilehome spaces held out for
rent after January 1, 1990 from local rent control (Civil Code
Section 798.95).
3)Allows the park management or ownership of a mobilehome park
to pass through government imposed fees to mobilehome owners
in jurisdictions with local rent control ordinances (Civil
Code Section 798.99).
9)Exempts from local rent control mobilehomes that are not the
principle residence of a homeowner and are not rented to
another party (Civil Code Section 798.21).
5)Allowed a landlord of an apartment building in a rent control
jurisdiction, until January 1, 1999, to increase the rent
twice after a tenant has voluntarily vacated, abandoned or
been evicted only by an amount that is no greater than 150
more than the rental rate in effect for the immediately
preceding tenancy or in the amount that is 700 of the
prevailing market rent for comparable units whichever is
greater (Civil Code Section 1959.50 et. seq).
FISCAL EFFECT None.
COMMENTS
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AB 1309 Assembly Bill - Bill Analysis
Background:.
There are approximately 4,822 mobilehome parks and manufactured
communities in the state. There are an estimated 700,000
residents living in these parks. In the majority of parks,
mobilehome residents own their homes, but rent the spaces on
which their homes are installed. Mobilehomes are an affordable
AB_ 13.09
Page 3
option for low- and moderate-income homeowners across the state
where homeowners are able to qualify to purchase a mobilehome
and may not qualify to purchase a stick-built home. Homeowners
in some jurisdictions also benefit from local rent control
ordinances which keep the rent for the lot on which their
moiblehome is located affordable.
Birkenfeld v. Berkeley (1976) 17 Cal. 3d 129, provides that
cities and counties have within their policy and regulation
powers the authority to enact rent control laws so long as a
fair return is assured to property owners. Under existing law,
local governmental entities are free to enact rent control laws
regarding mobilehome parks. These local laws are not subject to
the state's Costa-Hawkins Act restricting permissible rent
control ordinances, but in certain limited circumstances the
Mobilehome Residency Law (MRL) exempts certain mobilehome park
spaces from local rent control. Under existing law, rental
agreements which are twelve months or longer are exempt from
local rent control. Additionally if a mobilehome is not an
owners principle residence and is not being rented to another
party then it is exempt from rent control. Approximately 110
jurisdictions in the state have some form of local rent control
ordinance limiting the amount of rent or establishing a maximum
amount of rent that the management of a mobilehome park may
charge a tenant.
Vacancy Decontrol:-
Local ordinances which impose rent control on mobilehome parks
provide for allowable
rent increases either through vacancy control or decontrol.
Through vacancy control rent increases are prohibited when a
unit becomes vacant and a new tenant occupies the unit. This
system requires landlords to seek rent increases or adjustments
through an administrative process. Vacancy decontrol allows a
landlord to increase the rent to the market rate when a unit
becomes vacant and a new tenant occupies the unit. Controls are
then imposed on the new rates by the local jurisdiction. Some
jurisdictions have partial decontrol allowing a partial rent
increase upon vacancy above the annual rent adjustment but do
not decontrol the space from the ordinance.
The purp_ose_of__this bill
According to the author, severe and inconsistent local rent
AB _1309
Page 4
control regulations have had a significant negative impact on
the investment in mobilehome parks and resulted in a reduction
in the quantity and quality of parks. The purpose of AB 1309 is
to implement vacancy decontrol for the re-regulation of rent
increases for new tenants in mobilehome parks as was provided
for apartment buildings in the Costa-Hawkins Act.
Arg_um_ents_ n_ _ suppgrt
According to the sponsor, severe rent control ordinances have
jeopardized "the financial viability of mobilehome parks,
created disincentives for owners to remain in the business of
owning and managing parks, have resulted and until balance is
returned will continue in an ever accelerating erosion of
mobilehome park housing stock." According to the sponsor
anecdotal evidence suggests that "the value of a mobilehome has
an inverse relationship to the rent for the space on which it
exists. The most extreme examples are of coaches in a Malibu
park selling for well over one million dollars on rent
controlled spaces. While those are the exception, there is no
doubt that rent control, especially stringent control, has the
impact of transferring virtually the complete economic value in
a mobilehome transaction to the person lucky enough to have
owned a coach on a space in such a park."
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AB 1309 Assembly Bill - Bill Analysis
.Arguments in opposition
According to the opposition, AB 1309 would bring an end to
affordable housing upon the resale of mobilehomes. Golden State
Manufactured-Home Owners League (GSMOL) believes AB 1309 is
unnecessary because all existing mobilehome rent control
ordinances allow an annual increase in space rent and may
already allow a further increase in rent upon the resale for a
home. According to GSMOL, AB 1309 would allow a park owner the
ability to raise space rents which would adversely impact a low
income seller selling their mobilehome. Few mobilehome owners
selling their homes will be able to receive a reasonable price
if park ownership is subjecting their prospective purchaser to
large and space rent increases. In an apartment rental where
decontrol applies, a landlord setting the apartment rent too
high will lose money from a vacancy, and the market may require
a rent reduction until the apartment is rented. However, in a
mobilehome park tenancy, the park owner will suffer no vacancy
or loss of income. The park owner's ability to establish a
large rental increase to a prospective mobilehome buyer will
_AB_ 130_9
Page 5
interfere with the resale while the low income homeowner who
needs to sell the home continues to pay space rent, or loses his
home.
According to the Western Center on Law & Poverty, although the
legislative findings of the bill reference experts who believe
rent controls reduce the quality of housing, other studies find
the opposite. Researchers with the University of California, Los
Angeles found that in cities with vacancy controls diversity was
protected and affordable housing was preserved. The percentage
of Latino and Asian renters in rent controlled cities increased
from pre-rent control levels and the percentage of African
American renters remained stable or increased under rent
control. Additionally, senior working families, disabled and
families with children were protected by strong rent control
from the displacement taking place elsewhere. Children
increased in the vacancy-controlled areas and decreased in
uncontrolled areas.
Staff comments
__ _
A recent article.in the Modesto Bee reported that the Modesto
City Council voted to advance a rent control ordinance for
mobilehome parks. The need for the ordinance resulted from a
mobilehome park owner based in Chicago who increased rents in
their mobilehome park for seniors from $400 to $800 over eight
years. According to the article, the park owner raised the rents
to bring them up to market rates which he determined by
evaluating all residential properties in the county. The
committee may wish to consider whether this example illustrates
the need to leave decisions about rent control, either vacancy
control or decontrol, to local officials? Officials at the
local level are best equipped to assess the housing conditions
and determine what controls need to be in place to protect
low-income homeowners and renters.
The committee may wish to consider that rent control is designed
to stabilize the limited stock of housing available to
low-income residents. Rent control protects low-income tenants
from rent hikes that could result in eviction that leave the
tenant unable to rent another apartment or mobilehome due to the
black mark of an eviction. Supporters of this bill contend that
in a limited number of cases in luxury mobilehome parks, tenants
are able to sell their mobilehomes for large sums of money
because of the benefit the buyer receives through rent control.
The committee may wish to consider if this limited number of
AB 1309
Page 6
situations warrants eliminating local policy making.
The committee may wish to consider that mobilehome owners are a
captive audience. Once a mobilehome is located in a mobilehome
park they are largely impossible to move to another park. Moving
a mobilehome out of a park can cost upwards of $10,000. Under
this bill, after four years, the management is permitted to set
the rent at any amount upon the sale of the home and this could
negatively affect the mobilehome owner's ability to sell their
home.
Doub__le_referred The Assembly Committee on Rules referred AB
1309 to Housing and Community Development and Judiciary
Page 3 of 4
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AB 1309 Assembly Bill - Bill Analysis
Committee. If AB 1309 passes this committee, the bill must be
referred to the Assembly Committee on Judiciary.
REGISTERED SUPPORT / OPPOSITION
__
.Support
Western Manufactured Housing Communities Association (WMA)
(sponsor)
California Association of Realtors
California Chamber of Commerce
California Mobilehome Parkowners Alliance
_ Opposito_n_
California Alliance for Retired Americans
City of Santa Rosa
League of California Cities
Golden State Manufactured-Home Owners League (GSMOL)
Western Center on Law & Poverty
Analysis__Prepared by Lisa Engel / H. & C.D. / (916) 319-2085
Page 4 of 4
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AMENDED IN ASSEMBLY JUNE 5, 2007
CALIFORNIA LEGISLATURE-2007-OS REGULAR SESSION
ASSEMBLY BILL
No. 1542
Introduced by Assembly "~`~--~'~~--'~'--~--~ Members Evans and Leno
(Principal coauthor: Senator Corbett)
(Coauthors: Assembly Members Berg, Huffman, Laird, Lieber, and
Richardson)
(Coauthor: Senator Wiggins)
February 23, 2007
An act to amend ~ Section 66427.5
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of the Government Code, relating to mobilehome parks.
LEGISLATIVE COUNSEL'S DIGEST
AB 1542, as amended, Evans. Mobilehome parks: conversions.
(1) The Subdivision Map Act requires a subdivider, at the time of
filing a tentative or parcel map for a subdivision to be created from the
conversion of a rental mobilehome park to resident ownership, toga
avoid the economic
displacement of all nonpurchasing residents in accordance with
specked provisions that apply to all tenants and specked provisions
that apply to nonpurchasing residents who are not lower income
households. A violation of the act is a crime punishable as a felony or
a misdemeanor. That act also requires that the subdivider is subject to
a hearing by the legislative body or the advisory agency, which is
9s
AB 1542 - 2 -
authorized by local ordinance to approve, conditionally approve, or
disapprove the map, and that the scope of the hearing is limited to the
issue of compliance with these provisions.
This bill would delete the hearing limitation, but
would also require, notwithstanding the conversion, that local rent
control measures remain applicable to any rental of mobilehome space
within the park. Because the bill would expand the scope of an existing
crime, it would impose astate-mandated local program.
The bill would also revise these provisions as to nonpurchasing
residents who are not low- or moderate-income households where the
conversion is not subject to local rent control.
(2) The act requires the legislative body, or an advisory agency that
is authorized by local ordinance to approve, conditionally approve, or
disapprove the map, to require the subdivider to take steps to mitigate
any adverse impact of the conversion on the ability of displaced
mobilehome park residents to find adequate space in a mobilehome
park.
This bill would delete these requirements, and would make a
conforming change.
(3) The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the state.
Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act
for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
The people of the State of California do enact as follows:
1 SECTION 1. Section 66427. S of the Government Code is
2 amended to read.•
3 66427.5. At the time of filing a tentative or parcel map for a
4 subdivision to be created from the conversion of a rental
5 mobilehome park to resident ownership, the subdivider shall avoid
6 the economic displacement of all nonpurchasing residents in the
7 following manner:
8 (a) The subdivider shall offer each existing tenant an option to
9 either purchase his or her condominium or subdivided unit, which
10 is to be created by the conversion of the park to resident ownership,
11 or to continue residency as a tenant.
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(b) The subdivider shall file a report on the impact of the
conversion upon residents of the mobilehome park to be converted
to resident owned subdivided interest.
(c) The subdivider shall make a copy of the report available to
each resident of the mobilehome park at least 15 days prior to the
hearing on the map by the advisory agency or, if there is no
advisory agency, by the legislative body.
(d) (1) The subdivider shall obtain a survey of support of
residents of the mobilehome park for the proposed conversion.
(2) The survey of support shall be conducted in accordance with
an agreement between the subdivider and a resident homeowners'
association, if any, that is independent of the subdivider or
mobilehome park owner.
(3) The survey shall be obtained pursuant to a written ballot.
(4) The survey shall be conducted so that each occupied
mobilehome space has one vote.
(5) The results of the survey shall be submitted to the local
agency upon the filing of the tentative or parcel map, to be
considered as part of the subdivision map hearing prescribed by
subdivision (e).
(e) The subdivider shall be subject to a hearing by a legislative
body or advisory agency, which is authorized by local ordinance
to approve, conditionally approve, or disapprove the map.-fie
(f) ~e-In the absence of local rent control, the subdivider shall
be required to avoid the economic displacement of all
nonpurchasing residents in accordance with the following:
(1) As to nonpurchasing residents who are not lower income
households, as defined in Section 50079.5 of the Health and Safety
Code, the monthly rent, including any applicable fees or charges
for use of any preconversion amenities, may increase from the
preconversion rent to market levels, as defined in an appraisal
conducted in accordance with nationally recognized professional
appraisal standards, in equal annual increases over afour-year
period.
(2) As to nonpurchasing residents who are lower income
households, as defined in Section 50079.5 of the Health and Safety
Code, the monthly rent, including any applicable fees or charges
for use of any preconversion amenities, may increase from the
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AB 1542
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preconversion rent by an amount equal to the average monthly
increase in rent in the four years immediately preceding the
conversion, except that in no event shall the monthly rent be
increased by an amount greater than the average monthly
percentage increase in the Consumer Price Index for the most
recently reported period.
(g) Notwithstanding the conversion, local rent control measures
shall remain applicable to any rental of mobilehome space within
the park.
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SEC. 2. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.
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AB 1542 Assembly Bill - History Page 1 of 1
COMPLETE BILL HISTORY
BILL NUMBER A.B. No. 1542
AUTHOR Evans
TOPIC Mobilehome parks: conversions.
TYPE OF BILL
Active
Non-Urgency
Non-Appropriations
Majority Vote Required
State-Mandated Local Program
Fiscal
Non-Tax Levy
BILL HISTORY
2007
July 25 Read second time. To third reading.
July 20 From committee: Be placed on second reading file pursuant to Senate
Rule 28.8.
July 11 From committee: Do pass, and re-refer to Com. on APPR.
Re-referred. (Ayes 3. Noes 2.) .
July 5 From committee: Do pass, and re-refer to Com. on JUD. Re-referred.
(Ayes 6. Noes 2 . )
June 21 Referred to Coms. on T. & H. and JUD.
June 11 In Senate. Read first time. To Com, on RLS. for assignment.
June 7 Read third time, passed, and to Senate. (Ayes 41. Noes 32. Page
2077.)
June 5 Read third time, amended, and returned to third reading. (Ayes 41.
Noes 32. Page 1941.).
June 5 Read third time, amended, and returned to third reading. Action
rescinded whereby the bill was read third time and amended.
May 24 Read second time. To third reading.
May 23 From committee: Do pass. (Ayes 10. Noes 5.) (May 23).
Apr. 26 From committee: Do pass, and re-refer to Com. on APPR.
Re-referred. (Ayes 4. Noes 2.) (April 25).
Apr. 11 From committee: Do pass, and re-refer to Com. on L. GOV.
Re-referred. (Ayes 5. Noes 2.) (April 11).
Mar. 29 Referred to Coms. on H. & C.D. and L. GOV.
Feb. 26 Read first time.
Feb. 25 From printer. May be heard in committee March 27.
Feb. 23 Introduced. To print.
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AB 1542 Assembly Bill - Bill Analysis
BILL ANALYSIS
------------------------------------------------------------
ISENATE RULES COMMITTEE I AB 15921
(Office of Senate Floor Analyses I I
11020 N Street, Suite 529 I I
1(916) 651-1520 Fax: (916) I I
1327-9978 I I
THIRD READING
Bill No: AB 1592
Author: Evans (D), et al
Amended: 6/5/07 in Assembly
Vote: 21
SENATE TRANSPORTATION & HOUSING COMMITTEE_ 6-2, 7/3/07
AYES: Lowenthal, Cedillo, Corbett, Kehoe, Simitian,
Torlakson
NOES: McClintock, Ashburn
NO VOTE RECORDED: Dutton, Harman, Yee
SENATE JUDICIARY COMMITTEE 3-2, 7/10/07
__ _ _ _ _ __
AYES: Corbett, Kuehl, Steinberg
NOES: Harman, Ackerman
SENATE APPROPRIATIONS COMMITTEE Senate Rule 28.8
ASSEMBLY FLOOR 91-32, 6/7/07 - See last page for vote
_SUBJECT_ Mobilehome park conversions
_S_O[JRCE_ City of Santa Rosa
County of Sonoma
DIGEST This bill maintains local rent control on lots
that are not purchased by residents within a mobilehome
park that converts to resident ownership.
ANALYSIS_ The Subdivision Map Act (Act) governs the
division of real property into parcels or condominiums and
CONTINUED
AB 1542
Page
requires that a subdivider file a tentative map for
approval by a local agency. Under the Act, a subdivider of
a mobilehome park who wishes to convert that park to
another use must file a tentative or parcel map and must
also file a report on the impact of the conversion on
residents of the park. This report must specifically
address the availability of adequate replacement space in
mobilehome parks. When approving the map, the local agency
may require that the subdivider take steps to mitigate any
adverse impacts of the conversion on the displaced
residents of the park.
Existing law creates an exemption to the Act for
conversions of mobilehome parks to resident ownership.
Under this exemption (Section 66927.5 of the Government
Code), a subdivider of a mobilehome park submits a
tentative or parcel map to the local agency for review and
approval. This exemption requires the subdivider to avoid
the economic displacement of non-purchasing residents by:
1. Offering each existing tenant an option to buy his/her
lot.
2. Filing a report on the impact of the conversion on
residents and making that report available to residents
of the park.
3. Surveying residents about their support for the
conversion.
9. Submitting to a local agency hearing solely on the
subdivider's compliance with the law requiring avoidance
of economic displacement of non-purchasing residents.
5. Limiting rent increases of non-purchasing, low-income
residents by an amount equal to the average monthly
increase in rent in the four years immediately preceding
Page 1 of 5
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AB 1542 Assembly Bill - Bill Analysis
the conversion, except that in no case shall the
increase be greater than the increase in the Consumer
Price Index.
6. Limiting rent increases on those non-purchasing
residents who are not low-income to market-rate levels
through equal annual increases spread over a four-year
AB___1542
Page
3
period.
This bill:
1. Permits the local government to review matters beyond
compliance with the law on avoiding the economic
displacement of residents.
2. Provides that only in the absence of local rent control
shall the limits on rent increases that may be charged
non-purchasing residents apply (i.e., those in #5 and #6
above).
3. Maintains local rent control measures on spaces that are
not purchased when a mobilehome park converts to
resident ownership.
.Background
The residents of California's nearly 5,000 mobilehome parks
typically own their mobilehomes and rent the spaces in
mobilehome parks on which the homes are placed.
Mobilehomes, once placed in a park, are difficult to
relocate. Because of this, many local governments impose
mobilehome park space rent controls to limit the amount
that rent on a space can increase each year. As the value
of the land under a mobilehome park increases, rents for
those spaces may not increase commensurately in local
communities with rent control ordinances.
For various reasons, mobilehome park residents in some
parks have decided to join together and buy the park or
their individual spaces within it. This is referred to as
a conversion to resident ownership.
Historically, when mobilehome parks have converted to
resident ownership, the residents have initiated the
process and enlisted the help of a nonprofit organization.
The nonprofit organization typically buys the entire park
and sells lots to individual owners.
Until 1996, local jurisdictions imposed their own
conditions on proposed subdivisions of mobilehome parks
into individual, resident-owned lots. In the 1990s, some
AB 1592
Page
9
argued that local governments sometimes imposed conditions
under the Act that prevented the conversion of a park into
resident ownership. For example, a local government might
condition the map on the building of sidewalks, curbs, and
gutters on the streets in the mobilehome park. In 1995,
then Senator Craven introduced a bill to address this
issue.
SB 310 (Craven), Chapter 256, Statutes of 1995, amended the
Act to ensure that subdividers of mobilehome parks gave
residents the opportunity to purchase a space in the park
and to avoid being displaced if they could not afford to
purchase a space. Under this law, residents who cannot
purchase their spaces are allowed to remain as renters, and
the bill prescribed a formula for how rents for
non-purchasing residents would be calculated. That formula
raises rents to market levels over a four-year period,
except those renters that are low-income may only have
their rents increased by the average monthly increase in
rent in the four years immediately preceding the
conversion, but in no case by more than an amount equal to
increases in the Consumer Price Index.
In 1993, the owner of the E1 Dorado Mobile Country Club, a
377-space mobilehome park in Palm Springs, filed a
tentative subdivision map as a first step to converting the
park to resident ownership by existing residents or other
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AB 1542 Assembly Bill - Bill Analysis
persons.
The Palm Springs City Council, concerned that this was a
"sham" conversion to circumvent its local rent control
ordinance, approved the map subject to several conditions,
including that the effective map date would be the date
escrow closed on 120 lots in the park. Under this
condition, the park would cease to be subject to the city's
mobilehome space rent control ordinance when 120 of its
lots sold. After that date, the formula for mitigating
economic displacement under SB 310 would be applicable.
This would prevent circumventing the rent control ordinance
by just selling a few lots (i.e., a "sham" conversion).
E1 Dorado's owner filed a lawsuit in superior court to
compel approval of the subdivision map without the
conditions, including the condition delaying the effective
- _ 5
AB 15.92
Page
date of the map. E1 Dorado's owner claimed that the
effective date of conversion was when one lot was sold, and
the city council did not have the power to impose more
stringent requirements. The lower court denied the park
owner's petition, but in 2002, the 9th District Court of
Appeal reversed that decision ruling in favor of the park
owner in E1 Dorado Palm Springs,__Ltd.~ v. Crt~ of Palm
- _ - --
Springs.. .
The appellate court ruled that the city was limited to the
scope of assuring that E1 Dorado's owner had complied with
requirements of Section 66427.5, the exemption to the Act
enacted by SB 310. The court ruled that Section 66927.5
takes effect as soon as one unit is sold, and therefore,
its rent formulas supersede a local rent control ordinance
as soon as that first lot is sold.
The proponents of SB 310 did not foresee instances in which
mobilehome park owners, rather than residents, would use
its exemption to the Act to convert their parks into
condominium-type parks, where the owner subdivides the park
and sells spaces to the residents.
Since the owner of E1 Dorado Park in Palm Springs first
used the Act for conversion to resident ownership, many
more mobilehome park owners have pursued this type of
conversion. This has set up a conflict between park owners
and park residents over the use of existing state law for
conversion of parks to resident ownership.
FI$CAL__EFFE_CT Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT (Verified 7/29/07)
City of Santa Rosa (co-source)
County of Sonoma (co-source)
American Planning Association, California Chapter
California Rural Legal Assistance Foundation
California State Association of Counties
City of Carson
City of Cloverdale
City of Cotati
City of Hayward
6
AB 1542
Page
City of Scotts Valley
City of Winters
County of Santa Cruz
Eden Gardens Mobilehome Park Homeowners Association
(Hayward)
Golden State Manufactured-Home Owners League
Golden State Manufactured-Home Owners League, Inc., Chapter
916
Hayward Country Club Mobilehome Owners Association
Hayward Mobilehome Owners Association
League of California Cities
Mayors' and Councilmembers' Association of Sonoma County
Pacific Grove Mobile Home Park Homeowners Association
(Capitola)
Palo Mobile Estates Homeowners Association (East Palo Alto)
Pueblo Springs Mobilehome Owners Association (Hayward)
State Building and Construction Trades Council of
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AB 1542 Assembly Bill - Bill Analysis
California
Trailer Haven Homeowner's Association (Santa Cruz)
Western Center on Law and Poverty
OPPOSITION (Verified 7/24/07)
California Association of Realtors
California Mobilehome Parkowners Alliance
Californians for Resident Ownership
Western Manufactured Housing Communities Association
ARGUMENTS_IN SUPPORT According to the author:
"Mobilehomes have traditionally provided affordable
housing to people that would otherwise be priced out of
any type of ownership. [Therefore] local rent control
ordinances keep mobilehomes at an affordable rate for
seniors and working families who are on a fixed income.
"Current law allows a mobilehome park to be subdivided
into residential ownership. The original law was written
in order to give the residents of mobilehome parks an
opportunity to buy the land they live on.
"Serious unintended consequences have surfaced (as a
result). For instance, if one parcel in a mobilehome park
is sold, the four year phase-out of rent control begins.
AB _1592
Page
This means that a parcel that is rented for $600 today
may be rented for 51000 to $1500 in a very short four
years. The end result is that the affordable housing
stock will be severely compromised. Seniors and working
families will be pushed from their homes.
"In the past few years, there has been a surge in
applications being filed by park owners who want to
convert their parks from rental mobilehomes into
residential ownership. This is often being done over the
protests of local government and residents of the parks,
who have no recourse to stop the conversion.
"AB 1592 does not ban conversions. Instead, it strikes a
balance between an outright ban on conversions, and no
regulation at all."
ARGUMENTS_IN OP_POSITLON_: Opponents note that existing
law provides f.or state regulation of rent increases after a
park converts, that local control of conversions will add
delay to the process, and that delaying the process will
discourage owners from converting, thus eliminating
homeownership opportunities for those who wish to buy their
lots. Writing in opposition, Western Manufactured Housing
Communities Association (WMA) states that there has been no
showing of any harm to a resident from conversions that
have taken place. Additionally, WMA writes that this bill
further confuses the conversion process, because it creates
separate conversion rules for communities with local rent
control and those without rent control.
ASSEMBLY FLOOR
- _.
AYES: Arambula, Bass, Beall, Berg, Brownley, Caballero,
Carter, Coto, Davis, De La Torre, De Leon, DeSaulnier,
Dymally, Eng, Evans, Feuer, Fuentes, Hancock, Hayashi,
Huffman, Jones, Karnette, Krekorian, Laird, Leno, Levine,
Lieber, Lieu, Mendoza, Mullin, Nava, Portantino, Price,
Richardson, Ruskin, Salas, Saldana, Swanson, Torrico,
Wolk, Nunez
NOES: Adams, Aghazarian, Anderson, Benoit, Berryhill,
Blakeslee, DeVOre, Duvall, Emmerson, Fuller, Gaines,
Garcia, Garrick, Horton, Houston, Huff, Jeffries, Keene,
La Malfa, Maze, Nakanishi, Niello, Parra, Plescia, Sharon
AB 15.92
Page
8
Runner, Silva, Smyth, Spitzer, Strickland, Tran,
Villines, Walters
NC VOTE RECORDED: Charles Calderon, Cook, Galgiani,
Hernandez, Ma, Solorio, Soto
JJA:mw 7/29/07 Senate Floor Analyses
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AB 1542 Assembly Bill -Bill Analysis
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
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AMENDED IN ASSEMBLY JULY 2, 2007
AMENDED IN SENATE APRIL 17, 2007
AMENDED IN SENATE APRIL 9, 2007
SENATE BILL No. 981
Introduced by Senator Padilla
(Principal coauthor: Assembly Member DeSaulnier)
(Coauthors: Senators Corbett, Correa, Steinberg, and Wiggins)
(Coauthors: Assembly Members Lieber and Torrico)
February 23, 2007
An act to amend Sections 798.15 and 798.31 of the Civil Code,
relating to mobilehomes.
LEGISLATIVE COUNSEL'S DIGEST
SB 981, as amended, Padilla. Mobilehomes: rental agreements.
Existing law requires mobilehome park rental agreements to contain
a provision specifying that it is the responsibility of the management
to provide and maintain physical improvements in the common facilities
in good working order and condition, as specified. Existing law prohibits
the management of a mobilehome park from charging a homeowner a
fee other than rent, utilities, and incidental reasonable charges.
This bill would require this rental agreement provision to also specify
that management shall maintain existing physical improvements with
funds acquired through rent and not other fees. This bill would also
require the management of a mobilehome park to provide and maintain
existing physical improvements in the common facilities in good
working order and condition with funds acquired through rent and not
with funds acquired through other fees. The bill would provide that the
changes of these provisions made by this act apply only to rental
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SB 981
2
agreements, including month-to-month rental agreements, that are
executed, extended, or renewed on or after January 1, 2008, and are
not intended to preempt or control an existing local mobilehome rent
control ordinance that includes provisions for fees or charges for the
maintenance of existing common area facilities or existing park
infrastructure.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
The people of the State of California do enact as follows:
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SECTION 1. Section 798.15 of the Civil Code is amended to
read:
798.15. The rental agreement shall be in writing and shall
contain, in addition to the provisions otherwise required by law to
be included, all of the following:
(a) The term of the tenancy and the rent-tl~erefer for that tenancy.
(b) The rules and regulations of the park.
(c) A copy of the text of this chapter shall be attached as an
exhibit and shall be incorporated into the rental agreement by
reference. Management shall provide all homeowners with a copy
of this chapter prior to February 1 of each year, if a significant
change was made in the chapter by legislation enacted in the prior
year.
(d) A provision specifying that (1) it is the responsibility of the
management to provide and maintain physical improvements in
the common facilities in good working order and condition and
(2) with respect to a sudden or unforeseeable breakdown or
deterioration of these improvements, the management shall have
a reasonable period of time to repair the sudden or unforeseeable
breakdown or deterioration and bring the improvements into good
working order and condition after management knows or should
have known of the breakdown or deterioration. This provision
shall also specify that management shall maintain existing physical
improvements with funds acquired through rent and not other fees.
For purposes of this subdivision, a reasonable period of time to
repair a sudden or unforeseeable breakdown or deterioration shall
be as soon as possible in situations affecting a health or safety
condition, and shall not exceed 30 days in any other case except
where exigent circumstances justify a delay.
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(e) A description of the physical improvements to be provided
the homeowner during his or her tenancy.
(f) A provision listing those services which will be provided at
the time the rental agreement is executed and will continue to be
offered for the term of tenancy and the fees, if any, to be charged
for those services.
(g) A provision stating that management may charge a
reasonable fee for services relating to the maintenance of the land
and premises upon which a mobilehome is situated in the event
the homeowner fails to maintain the land or premises in accordance
with the rules and regulations of the park after written notification
to the homeowner and the failure of the homeowner to comply
within 14 days. The written notice shall state the specific condition
to be corrected and an estimate of the charges to be imposed by
management if the services are performed by management or its
agent.
(h) All other provisions governing the tenancy.
SEC. 2. Section 798.31 of the Civil Code is amended to read:
798.31. (a) A homeowner shall not be charged a fee for other
than rent, utilities, and incidental reasonable charges for services
actually rendered.
(b) Management shall provide and maintain existing physical
improvements in the common facilities in good working order and
condition with funds acquired through rent and not with funds
acquired through other fees.
(c) A homeowner shall not be charged a fee for obtaining a lease
on a mobilehome lot for (1) a term of 12 months, or (2) a lesser
period as the homeowner may request. A fee may be charged for
a lease of more than one year if the fee is mutually agreed upon
by both the homeowner and management.
SEC. 3. Vi(a) The changes made to Sections 798.1 S and
798.31 of the Civil Code by this act shall apply only to rental
agreements, including month-to-month rental agreements, that are
executed, extended, or renewed on or after January 1, 2008.
(b) The changes made to Sections 798.1 S and 798.31 of the
Civil Code by this act are not intended to preempt or control an
existing local mobilehome rent control ordinance that includes
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1 provisions for fees or charges for the maintenance of existing
2 common area facilities or existing park infrastructure.
SB 981 Senate Bill - History
COMPLETE BILL HISTORY
BILL NUMBER S.B. No. 981
AUTHOR Padilla
TOPIC Mobilehomes: rental agreements.
TYPE OF BILL
Active
Non-Urgency
Non-Appropriations
Majority Vote Required
Non-State-Mandated Local Program
Non-Fiscal
Non-Tax Levy
BILL HISTORY
2007
Aug. 28 Motion to reconsider continued to August 29.
Aug. 27 Read third time. Refused passage. Motion to reconsider made by
Assembly Member DeSaulnier.
July 3 Read second time. To third reading.
July 2 Read second time. Amended. To second reading.
June 28 From committee: Do pass as amended. (Ayes 5. Noes 2.)
June 7 To Com. on H. & C.D.
May 31 In Assembly. Read first time. Held at Desk.
May 31 Read third time. Passed. (Ayes 21. Noes 15. Page 1127.) To
Assembly.
Apr. 17 Read second time. Amended. To third reading.
Apr. 16 From committee: Do pass as amended. (Ayes 3. Noes 2. Page
519.)
Apr. 9 From committee with author's amendments. Read second time.
Amended. Re-referred to Com. on JUD.
Mar. 28 Set for hearing April- 10.
Mar. 20 Hearing postponed by committee.
Mar. 15 To Com. on JUD. Set for hearing March 27.
Feb. 26 Read first time.
Feb. 25 From print. May be acted upon on or after March 27.
Feb. 23 Introduced. To Com. on RLS. for assignment. To print.
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SB 981 Senate Bill - Bill Analysis
BILL ANALYSIS
SB• 981
Page 1
SENATE THIRD READING
SB 981 (Padilla)
As Amended July 2, 2007
Majority vote
SENATE VOTE :21-15
HO[1SING 5-2
IAyes:ISaldana, Bass, Hancock, I I I
I (Mullin, Swanson I I I
i I I I
!-----+-- ---------- --+-----+--------------------------I
INays:IGarcia, Sharon Runner I I I
I I I I I
SU_MMARY__ Requires the management of a mobilehome park to keep
existing physical improvements of common facilities of a park in
good working order and condition through rents and not other
fees. Specifically, this bill
1)Requires the rental agreement for a mobilehome to specify that
the management must maintain existing physical improvements
through rents and not through other fees.
2)Applies to rental agreements including month-to-month rental
agreements executed, extended, or renewed on or after January
1, 2008.
3)Specifies that the provisions of this bill are not intended to
preempt or control an existing local mobilehome rent control
ordinance which includes provisions for fees or charges for
maintenance of existing common area facilities or existing
park infrastructure.
FISCAL EFFECT None
COMMENTS There are approximately 9,766 mobilehome parks and
manufactured communities in the state. There are an estimated
700,000 residents living in these parks. In the majority of
parks, mobilehome residents own their homes, but rent the spaces
on which their homes are installed. Mobilehomes are an
affordable option for low- and moderate-income homebuyers who
SB_ 981
Page 2
may not qualify to purchase a stick-built home. Homeowners in
approximately 110 jurisdictions in the state also benefit from
local rent control ordinances which keep the rent for the lot on
which their mobilehome is located affordable.
The Mobilehome Residency Law (MRL) governs the relationship
between mobilehome park residents and owners. The MRL prohibits
a park owner from charging a homeowner a fee other than rent,
utilities and incidental reasonable charges for services
actually rendered. Additionally, the law states "it is the
responsibility of the management to provide and maintain
physical improvements in the-common facilities in good working
order and condition."
Park residents complain that the park owners are passing through
additional fees outside of the rent for maintenance costs that
should be factored into the rent.
According to the author, the intent of this bill is to clarify
that park owners must maintain common areas in good working
order and condition with funds acquired through rents and not
other fees. According to the sponsor, Golden State
Manufactured-Home Owners League, many mobilehome park owners
have begun to violate the spirit of existing law which requires
the park management to provide and maintain physical
improvements in the common facilities. The author states, "a
growing number of park owners are passing through fees, on top
of rent, to perform routine maintenance of existing common area
facilities." The sponsor refers to this practice as "double
billing" because such park owners are not maintaining existing
common areas using a portion of the rents from residents but
rather through additional fees and charges.
This bill would require the park management in a mobilehome park
to maintain the existing physical improvements through funds
charged for rent and not through other fees and to specify this
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SB 981 Senate Bill - Bill Analysis
requirement in the lease agreement. The intent of this bill is
to prevent the pass through of fees for existing physical
improvements rather than capital improvements. For example, if
a park owner determines that a new security gate is needed for
the park due to increased crime this expense could be passed on
to the residents as a capital expenditure.
Rent control v. non-rent control jurisdictions: The impact this
SB 981
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bill would have on a mobilehome park will depend on whether or
not it is in a jurisdiction with a rent control ordinance.
There are 536 cities and counties in the state and approximately
110 have mobilehome rent control ordinances. If this bill
passed, park owners in the non-rent control jurisdictions, where
there are no restrictions on what the park management can charge
residents in rent, will likely increase the rent to account for
the loss of the fee. Although the supporters acknowledge this
reality they assert that by requiring the fees to be included in
the rent homeowners will have more certainty because they will
know what the rent will be and park owners will not be permitted
to tack additional fees on to the rent for routine maintenance.
Essentially, park owners would be required to give residents
90-days notice of a rent increase rather than the 60-day notice
required of a fee increase not included in the lease agreement.
In the 20% of jurisdictions that have rent control this bill
would have greater impact. Rent control ordinances must enable
a park owner to pay all actual expenses and receive a reasonable
rate of return. The rent amount is determined by a rent control
board who considers a list of factors in setting the amount of
allowable rent. Those rent control ordinances should also
allow a rent sufficient for the park owner to maintain existing
physical improvements. Some rent control ordinances provide
fees on top of rent for capital expenditures. The capital
expenditure is typically amortized over a period of time to
allow the resident to pay off the improvement.
The City of Santa Rosa's rent control ordinance provides for
capitol improvement and capital replacement pass throughs. Both
types of pass throughs require some level of approval from the
mobilehome park residents and the City of Santa Rosa. For
example, to make capital improvement pass throughs the park
owner must "consult with the mobilehome residents prior to
initiating construction of the improvement or initiating a new
service regarding the nature and purpose of the improvements or
services and the estimated cost of the services".
It is important to note that this bill only applies to rental
agreements that are executed, extended or renewed on or after
January 1, 2008. This limitation will protect park owners who
currently have leases which include pass throughs for
maintenance of the common area and who are unable to raise the
$B_98_1
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rent due to the terms of the lease.
Arguments in support: The supporters of this bill argue that,
in all 110 jurisdictions with rent control, park owners are
allowed annual space rent increase either based on full Consumer
Price Index (CPI) increases or some portion thereof; and, that
all jurisdictions are required to allow the park owner a
reasonable return on their investment. Additionally, in all
rent control districts the park owners are financially able and
should be obligated to maintain existing common area facilities
by using some portion of the space rent they collect and not
impose additional pass-through charges on top of rent in order
to perform routine maintenance that any landlord should perform.
The sponsors suggest that in apartment buildings, the landlord
uses some portion of the rent to repair the roof, re-paint
carports, and slurry seal the parking lot, and the same should
be true in mobilehome parks.
Arguments in opposition: Opponents contend this bill will
negatively affect mobilehome parks in rent control
jurisdictions. Western Manufactured Housing Communities
Association (WMA) states in rent control jurisdictions there is
often an inadequate revenue stream to pay for major capital
improvements. WMA offers the example of road upgrades that run
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SB 981 Senate Bill - Bill Analysis
upwards of $100,000 for which a S5 - $7 space increase in rent
is insufficient to cover the cost.
Analysis Prepared_by Lisa Engel / H. & C. D. / (916) 319-2085
FN: 0001724
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