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U.S. Code as of:
01/19/04
Section 1701s. Rent supplement payments for qualified lower income families
(a) Authorization; maximum term; maximum aggregate amount
The Secretary of Housing and Urban Development (hereinafter
referred to as the "Secretary") is authorized to make, and contract
to make, annual payments to a "housing owner" on behalf of
"qualified tenants", as those terms are defined herein, in such
amounts and under such circumstances as are prescribed in or
pursuant to this section. In no case shall a contract provide for
such payments with respect to any housing for a period exceeding
forty years. The aggregate amount of the contracts to make such
payments shall not exceed amounts approved in appropriation Acts,
and payments pursuant to such contracts shall not exceed
$150,000,000 per annum prior to July 1, 1969, which maximum dollar
amount shall be increased by $40,000,000, on July 1, 1969, by
$100,000,000 on July 1, 1970, and by $40,000,000 on July 1, 1971.
(b) "Housing owner" defined; limitation on payments to housing
owner
As used in this section, the term "housing owner" means a private
nonprofit corporation or other private nonprofit legal entity, a
limited dividend corporation or other limited dividend legal
entity, or a cooperative housing corporation, which is a mortgagor
under section 221(d)(3) of the National Housing Act [12 U.S.C.
1715l(d)(3)] and which, after August 10, 1965, has been approved
for mortgage insurance thereunder and has been approved for
receiving the benefits of this section: Provided, That, except as
provided in subsection (j) of this section, no payments under this
section may be made with respect to any property financed with a
mortgage receiving the benefits of the interest rate provided for
in the proviso in section 221(d)(5) of that Act [12 U.S.C.
1715l(d)(5)]. Such term also includes a private nonprofit
corporation or other private nonprofit legal entity, a limited
dividend corporation or other limited dividend legal entity, or a
cooperative housing corporation, which is the owner of a rental or
cooperative housing project financed under a State or local program
providing assistance through loans, loan insurance, or tax
abatement and which may involve either new or existing construction
and which is approved for receiving the benefits of this section.
Subject to the limitations provided in subsection (j) of this
section, the term "housing owner" also has the meaning prescribed
in such subsection. Nothing in this section shall be construed as
preventing payments to a housing owner with respect to projects in
which all or part of the dwelling units do not contain kitchen
facilities; but of the total amount of contracts to make annual
payments approved in appropriation Acts pursuant to subsection (a)
of this section after December 31, 1970, not more than 10 per
centum in the aggregate shall be made with respect to such
projects.
(c) Definitions
As used in this section, the term -
(1) "qualified tenant" means any individual or family having an
income which would qualify such individual or family for
assistance under section 1437f of title 42, except that such term
shall also include any individual or family who was receiving
assistance under this section on the day preceding December 21,
1979, so long as such individual or family continues to meet the
conditions for such assistance which were in effect on such day;
and
(2) "income" means income from all sources of each member of
the household, as determined in accordance with criteria
prescribed by the Secretary. In determining amounts to be
excluded from income, the Secretary may, in the Secretary's
discretion, take into account the number of minor children in the
household and such other factors as the Secretary may determine
are appropriate.
The terms "qualified tenant" and "tenant" include a member of a
cooperative who satisfies the foregoing requirements and who, upon
resale of his membership to the cooperative, will not be reimbursed
for any equity increment accumulated through payments under this
section. With respect to members of a cooperative, the terms
"rental" and "rental charges" mean the charges under the occupancy
agreements between such members and the cooperative.
(d) Annual payment amount
The amount of the annual payment with respect to any dwelling
unit shall be the lesser of (1) 70 per centum of the fair market
rent, or (2) the amount by which the fair market rental for such
unit exceeds 30 per centum of the tenant's adjusted income.
(e) Criteria and procedure for determining eligibility and rental
charges; recertification of income; agreements for services
required in selection of tenants; delegation of authority to
issue certificates
(1) For purposes of carrying out the provisions of this section,
the Secretary shall establish criteria and procedures for
determining the eligibility of occupants and rental charges,
including criteria and procedures with respect to periodic review
of tenant incomes and periodic adjustment of rental charges.
(2) Procedures adopted by the Secretary hereunder shall provide
for recertifications of the incomes of occupants no less frequently
than annually for the purpose of adjusting rental charges and
annual payments on the basis of occupants' incomes, but in no event
shall rental charges adjusted under this section for any dwelling
exceed the fair market rental of the dwelling.
(3) The Secretary may enter into agreements, or authorize housing
owners to enter into agreements, with public or private agencies
for services required in the selection of qualified tenants,
including those who may be approved, on the basis of the
probability of future increases in their incomes, as lessees under
an option to purchase (which will give such approved qualified
tenants an exclusive right to purchase at a price established or
determined as provided in the option) dwellings, and in the
establishment of rentals. The Secretary is authorized (without
limiting his authority under any other provision of law) to
delegate to any such public or private agency his authority to
issue certificates pursuant to this subsection.
(4) No payments under this section may be made with respect to
any property for which the costs of operation (including wages and
salaries) are determined by the Secretary to be greater than
similar costs of operation of similar housing in the community
where the property is situated.
(f) Omitted
(g) Authority of Secretary
The Secretary is authorized to make such rules and regulations,
to enter into such agreements, and to adopt such procedures as he
may deem necessary or desirable to carry out the provisions of this
section. Nothing contained in this section shall affect the
authority of the Secretary of Housing and Urban Development with
respect to any housing assisted under this section, section
221(d)(3), section 231(c)(3), or section 236 of the National
Housing Act [12 U.S.C. 1715l(d)(3), 1715v(c)(3), 1715z-1], or
section 1701q of this title, including the authority to prescribe
occupancy requirements under other provisions of law or to
determine the portion of such housing which may be occupied by
qualified tenants. To ensure that qualified tenants occupying that
number of units with respect to which assistance was being provided
under this section immediately prior to November 30, 1983, receive
the benefit of assistance contracted for under this section, the
Secretary shall offer annually to amend contracts entered into with
owners of projects assisted under this section but not subject to
mortgages insured under title II of the National Housing Act [12
U.S.C. 1707 et seq.] to provide sufficient payments to cover 100
percent of the necessary rent increases and changes in the incomes
of qualified tenants, subject to the availability of authority for
such purpose under section 1437c(c) of title 42. The Secretary
shall take such actions as may be necessary to ensure that
payments, including payments that reflect necessary rent increases
and changes in the incomes of tenants, are made on a timely basis
for all units covered by contracts entered into under this section.
(h) Authorization of appropriations
There are authorized to be appropriated such sums as may be
necessary to carry out the provisions of this section, including,
but not limited to, such sums as may be necessary to make annual
payments as prescribed in this section, pay for services provided
under (or pursuant to agreements entered into under) subsection (e)
of this section, and provide administrative expenses.
(i) Omitted
(j) Additional definition of housing owner; restrictions on
payments
(1) For the purpose of assisting housing under this section on an
experimental basis, subject to the limitations of this subsection,
the term "housing owner" (in addition to the meaning prescribed in
subsection (b) of this section) includes -
(A) a private nonprofit corporation or other private nonprofit
legal entity, a limited dividend corporation or other limited
dividend legal entity, or a cooperative housing corporation,
which is a mortgagor under a mortgage which receives the benefits
of the interest rate provided for in the proviso in section
221(d)(5) of the National Housing Act [12 U.S.C. 1715l(d)(5)] and
which, after August 10, 1965, has been approved for mortgage
insurance under section 221(d)(3) of the National Housing Act and
has been approved for receiving the benefits of this section;
(B) a private nonprofit corporation or other private nonprofit
legal entity which is a mortgagor under a mortgage insured under
section 231(c)(3) of the National Housing Act [12 U.S.C.
1715v(c)(3)] and which, after August 10, 1965, has obtained final
endorsement of such mortgage for mortgage insurance and has been
approved for receiving the benefits of this section;
(C) a private nonprofit corporation, a public body or agency,
or a cooperative housing corporation, which is a borrower under
section 1701q of this title and has been approved for receiving
the benefits of this section: Provided, That, with respect to
properties financed with loans under such section made on or
before August 10, 1965, payments shall not be made with respect
to more than 20 per centum of the dwelling units in any property
so financed; and
(D) a private nonprofit corporation or other private nonprofit
legal entity, a limited dividend corporation or other limited
dividend legal entity, or a cooperative housing corporation,
which is assisted under section 236 of the National Housing Act
[12 U.S.C. 1715z-1] and which has been approved for receiving the
benefits of this section: Provided, That payments shall not be
made with respect to more than 20 per centum of the dwelling
units in any property so financed, except that the foregoing
limitation may be increased to 40 per centum of the dwelling
units in any such property if the Secretary determines that such
increase is necessary and desirable in order to provide
additional housing for individuals and families meeting the
requirements of subsection (c) of this section.
(2) Of the amounts approved in appropriation Acts pursuant to
subsection (a) of this section for payments under this section in
any year, not more than 5 per centum in the aggregate shall be paid
with respect to properties of housing owners as defined in
paragraph (1)(A) of this subsection, and not more than 5 per centum
in the aggregate shall be paid with respect to properties of
housing owners as defined in paragraphs (1)(B) and (1)(C) of this
subsection.
(k) Repealed. Pub. L. 105-276, title V, Sec. 514(d), Oct. 21, 1998,
112 Stat. 2548
(l) Additional available assistance authority
Notwithstanding the provisions of subsection (a) of this section
and any other provision of law, the Secretary may utilize
additional authority under section 1437c(c) of title 42 made
available by appropriation Acts on or after October 1, 1979, to
supplement assistance authority available under this section. The
Secretary shall utilize, to the extent necessary after September
30, 1984, any authority under this section that is recaptured
either as the result of the conversion of housing projects covered
by assistance under this section to contracts for assistance under
section 1437f of title 42 or otherwise (1) for the purpose of
making assistance payments, including amendments as provided in
subsection (g) of this section, with respect to housing projects
assisted under this section, but not subject to mortgages insured
under the National Housing Act [12 U.S.C. 1701 et seq.], that
remain covered by assistance under this section; and (2) if not
required to provide assistance under this section, and
notwithstanding any other provision of law, for the purpose of
contracting for assistance payments under section 236(f)(2) of the
National Housing Act [12 U.S.C. 1715z-1(f)(2)].
(m) Payments for benefit of certain projects having mortgages made
by State or local housing finance or government agencies
The Secretary shall, not later than 45 days after receipt of an
application by the mortgagee, provide interest reduction and rental
assistance payments for the benefit of projects assisted under this
section whose mortgages were made by State or local housing finance
agencies or State or local government agencies for a term equal to
the remaining mortgage term to maturity on projects assisted under
this section to the extent of -
(1) unexpended balances of amounts of authority as set forth in
certain letter agreements between the Department of Housing and
Urban Development and such State or local housing finance
agencies or State or local government agencies, and
(2) existing allocation under section 236 contracts on projects
whose mortgages were made by State or local housing finance
agencies or State or local government agencies which are not
being funded, to the extent of such excess allocation, for any
purposes permitted under the provisions of this section.
An application shall be eligible for assistance under the previous
sentence only if the mortgagee submits the application within 548
days after February 5, 1988, along with a certification of the
mortgagee that amounts are to be utilized hereunder for the purpose
of either (A) reducing rents or rent increases to tenants, or (B)
making repairs or otherwise increasing the economic viability of a
related project. Unexpended balances referred to in the first
sentence of this subsection which remain after disposition of all
such applications is favorably concluded shall be rescinded. The
authority conferred by this subsection to provide interest
reduction and rental assistance payments shall be available only to
the extent approved in appropriation Acts.
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