42 U.S.C. § 1437s : US Code - Section 1437S: Public housing homeownership and management opportunities

Search 42 U.S.C. § 1437s : US Code - Section 1437S: Public housing homeownership and management opportunities

(a) Homeownership opportunities in general
Low-income families residing in a public housing project shall be
provided with the opportunity to purchase the dwelling units in the
project through a qualifying resident management corporation as
follows:
(1) Formation of resident management corporation
As a condition for public housing homeownership -
(A) the adult residents of a public housing project shall
have formed a resident management corporation in accordance
with regulations and requirements of the Secretary prescribed
under this section and section 1437r of this title;
(B) the resident management corporation shall have entered
into a contract with the public housing agency establishing the
respective management rights and responsibilities of the
resident management corporation and the public housing agency;
and
(C) the resident management corporation shall have
demonstrated its ability to manage public housing effectively
and efficiently for a period of not less than 3 years.
(2) Homeownership assistance
(A) The Secretary may provide assistance from the Capital Fund
to a public housing project in which homeownership activities
under this section are conducted.
(B) The Secretary may provide financial assistance to public
housing agencies, resident management corporations, or resident
councils that obtain, by contract or otherwise, training,
technical assistance, and educational assistance as the Secretary
determines to be necessary to promote homeownership opportunities
under this section.
(C) This paragraph shall not have effect after February 4,
1991. The Secretary may not provide financial assistance under
subparagraph (B), after such date, unless the Secretary
determines that such assistance is necessary for the development
of a homeownership program that was initiated, as determined by
the Secretary, before November 28, 1990.
(3) Conditions of purchase by a resident management corporation
(A) A resident management corporation may purchase from a
public housing agency one or more multifamily buildings in a
public housing project following a determination by the Secretary
that -
(i) the resident management corporation has met the
conditions of paragraph (1);
(ii) the resident management corporation has applied for and
is prepared to undertake the ownership, management, and
maintenance of the building or buildings with continued
assistance from the Secretary;
(iii) the public housing agency has held one or more public
hearings to obtain the views of citizens regarding the proposed
purchase and, in consultation with the Secretary, has certified
that the purchase will not interfere with the rights of other
families residing in public housing, will not harm the
efficient operation of other public housing, and is in the
interest of the community;
(iv) the public housing agency has certified that it has and
will implement a plan to replace public housing units sold
under this section within 30 months of the sale, which plan
shall provide for replacement of 100 percent of the units sold
under this section by -
(I) production, acquisition, or rehabilitation of vacant
public housing units by the public housing agency; and
(II) acquisition by the resident management corporation of
nonpublicly owned, decent, and affordable housing units,
which the resident management corporation shall operate as
rental housing subject to tenant income and rent limitations
comparable to the limitations applicable to public housing;
and
(v) the building or buildings meet the housing quality
standards applicable under section 1437d(f) of this title, and
the physical condition, management, and operation of the
building or buildings are sufficient to permit affordable
homeownership by the families residing in the project.
(B) The price of a building purchased under the preceding
sentence shall be approved by the Secretary, in consultation with
the public housing agency and resident management corporation,
taking into account the fair market value of the property, the
ability of resident families to afford and maintain the property,
and such other factors as the Secretary determines to be
consistent with increasing the supply of dwelling units
affordable to very low income families.
(C) This paragraph shall not have effect after February 4,
1991. The authority for a resident management corporation to
purchase 1 or more multifamily buildings in a public housing
project from a public housing agency shall terminate after such
date, unless the Secretary determines that such purchase is
necessary for the development of a homeownership program that was
initiated, as determined by the Secretary, before November 28,
1990.
(4) Conditions of resale
(A)(i) A resident management corporation may sell a dwelling
unit or ownership rights in a dwelling unit only to a lower
income family residing in, or eligible to reside in, public
housing and only if the Secretary determines that the purchase
will not interfere with the rights of other families residing in
the housing project or harm the efficient operation of the
project, and the family will be able to purchase and maintain the
property.
(ii) The sale of dwelling units or ownership rights in dwelling
units under clause (i) shall be made to families in the following
order of priority:
(I) a lower income family residing in the public housing
project in which the dwelling unit is located;
(II) a lower income family residing in any public housing
project within the jurisdiction of the public housing agency
having jurisdiction with respect to the project in which the
dwelling unit is located;
(III) a lower income family receiving Federal housing
assistance and residing in the jurisdiction of such public
housing agency; and
(IV) a lower income family on the waiting list of such public
housing agency for public housing or assistance under section
1437f of this title, with priority given in the order in which
the family appears on the waiting list.
(iii) Each resident management corporation shall provide each
family described in clause (ii) with a notice of the eligibility
of the family to purchase a dwelling unit under this paragraph.
(B) A purchase under subparagraph (A) may be made under any of
the following arrangements:
(i) Limited dividend cooperative ownership.
(ii) Condominium ownership.
(iii) Fee simple ownership.
(iv) Shared appreciation with a public housing agency
providing financing under paragraph (6).
(v) Any other arrangement determined by the Secretary to be
appropriate.
(C) Property purchased under this section shall be resold only
to the resident management corporation, a lower income family
residing in or eligible to reside in public housing or housing
assisted under section 1437f of this title, or to the public
housing agency.
(D) In no case may the owner receive consideration for his or
her interest in the property that exceeds the total of -
(i) the contribution to equity paid by the owner;
(ii) the value, as determined by such means as the Secretary
shall determine through regulation, of any improvements
installed at the expense of the owner during the owner's tenure
as owner; and
(iii) the appreciated value determined by an inflation
allowance at a rate which may be based on a cost of living
index, an income index, or market index as determined by the
Secretary through regulation and agreed to by the purchaser and
the resident management corporation or the public housing
agency, whichever is appropriate, at the time of initial sale,
and applied against the contribution to equity; the resident
management corporation or the public housing agency may, at the
time of initial sale, enter into an agreement with the owner to
set a maximum amount which this appreciation may not exceed.
(E) Upon sale, the resident management corporation or the
public housing agency, whichever is appropriate, shall ensure
that subsequent owners are bound by the same limitations on
resale and further restrictions on equity appreciation.
(5) Use of proceeds
Notwithstanding any other provision of this chapter or other
law to the contrary, proceeds from the sale of a building or
buildings under paragraph (3) and amounts recaptured under
paragraph (4) shall be paid to the public housing agency and
shall be retained and used by the public housing agency only to
increase the number of public housing units available for
occupancy. The resident management corporation shall keep and
make available to the public housing agency and the Secretary all
records necessary to calculate accurately payments due the local
housing agency under this section. The Secretary shall not reduce
or delay payments under other provisions of law as a result of
amounts made available to the local housing agency under this
section.
(6) Financing
When financing for the purchase of the property is not
otherwise available for purposes of assisting any purchase by a
family or resident management corporation under this section, the
public housing agency involved may make a loan on the security of
the property involved to the family or resident management
corporation at a rate of interest that shall not be lower than 70
percent of the market interest rate for conventional mortgages on
the date on which the loan is made.
(7) Capital and operating assistance
Notwithstanding the purchase of a building in a public housing
project under this section, the Secretary shall continue to
provide assistance under section 1437g of this title with respect
to the project. Such assistance may not exceed the allocation for
the project under section 1437g of this title.
(8) Operating Fund allocation
Amounts from the Operating Fund shall not be available with
respect to a building after the date of its sale by the public
housing agency.
(b) Protection of nonpurchasing families
(1) Eviction prohibition
No family residing in a dwelling unit in a public housing
project may be evicted by reason of the sale of the project to a
resident management corporation under this section.
(2) Tenants rights
Families renting a dwelling unit purchased by a resident
management corporation shall have all rights provided to tenants
of public housing under this chapter.
(3) Rental assistance
If any family resides in a dwelling unit in a building
purchased by a resident management corporation, and the family
decides not to purchase the dwelling unit, the Secretary shall
offer to provide to the family (at the option of the family)
tenant-based assistance under section 1437f(o) of this title for
as long as the family continues to reside in the building. The
Secretary may adjust the payment standard for such assistance to
take into account conditions under which the building was
purchased.
(4) Rental and relocation assistance
If any family resides in a dwelling unit in a public housing
project in which other dwelling units are purchased under this
section, and the family decides not to purchase the dwelling
unit, the Secretary shall offer (to be selected by the family, at
its option) -
(A) to assist the family in relocating to a comparable
appropriate sized dwelling unit in another public housing
project, and to reimburse the family for their cost of
relocation; and
(B) to provide to the family the financial assistance
necessary to permit the family to stay in the dwelling unit or
to move to another comparable dwelling unit and to pay no more
for rent than required under subparagraph (A), (B), or (C) of
section 1437a(a)(1) of this title.
(c) Financial assistance for public housing agencies
The Secretary shall provide to public housing agencies such
financial assistance as is necessary to permit such agencies to
carry out the provisions of this section.
(d) Additional homeownership and management opportunities
This section shall not apply to the turnkey III, the mutual help,
or any other homeownership program established under section
1437d(c)(4)(D) of this title, as in effect before the effective
date under section 503(a) of the Quality Housing and Work
Responsibility Act of 1998, and in existence before February 5,
1988.
(e) Regulations
The Secretary shall issue such regulations as may be necessary to
carry out the provisions of this section. Such regulations may
establish any additional terms and conditions for homeownership or
resident management under this section that are determined by the
Secretary to be appropriate.
(f) Repealed. Pub. L. 104-66, title I, Sec. 1071(a), Dec. 21, 1995,
109 Stat. 720
(g) Limitation
Any authority of the Secretary under this section to provide
financial assistance, or to enter into contracts to provide
financial assistance, shall be effective only to such extent or in
such amounts as are or have been provided in advance in an
appropriation Act.