Sec. 3. Decoupling rental assistance from maturing rural housing loans
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Paragraph
(2)of section 521(a) of the Housing Act of 1949 ( 42 U.S.C. 1490a(a)(2) ) is amended by adding at the end the following new subparagraph: To continue to make decent, safe and sanitary housing available to low-income occupants of projects originally financed with a loan made or insured under section 514 or 515 that has matured on or after the date of the enactment of this subparagraph or with a grant under section 516, and at rental rates commensurate to income as specified in subparagraph
(A)of this paragraph, the Secretary may, subject to the availability of amounts provided in appropriation Acts, contract to make, make, and renew annual assistance payments pursuant to this subparagraph to the owners of such projects. The Secretary shall ensure that an offer to provide a contract for assistance payments pursuant to this subparagraph shall be extended to all owners of projects described in clause
(i)not later than 24 months before the maturation of the loan (except in the case of loans maturing after the date that is 24 months before the date of the enactment of this subparagraph). Each contract for assistance payments pursuant to this subparagraph shall— have a term of 20 years and be subject to availability of amounts provided in annual appropriations Acts; cover all new and existing households residing in the project, regardless of whether or not they were previously assisted under the rental assistance program authorized under subparagraph (A); be recorded at such local real property recording office as is prescribed by the State in which the project is located; bind the owner of the project and the owner’s successors to continue to operate the project in accordance with such agreements; require the owner (and such successors) to agree to continue to operate the projects as if it were subject to an existing loan under section 514 or 515 or grant under section 516, as applicable; extend to residents of the project all the rights that at the time such contract is entered into are extended to residents of projects subject to an existing loan under section 514 or 515 or a grant under section 516, as applicable; require the owner (and such successors) to maintain the assisted housing as decent, safe, and sanitary housing; and provide that the Secretary may renew the contract for additional 5-year terms if the assisted housing is maintained in such decent, safe, and sanitary condition, as determined by the Secretary. A contract for assistance provided pursuant to this subparagraph for a project shall provide assistance to the owner based on an initial reasonable operating budget the rents for which do not exceed such actual market rental rates for the area in which the project is located, as are established by the Secretary. The Secretary shall adjust the actual market rental rates used for purposes of this clause annually. In providing assistance pursuant to this subparagraph, the Secretary shall require the owner of the project to renew the assistance provided to each household not less frequently than annually, in accordance with the provisions of subparagraph (A), and shall adjust the amount of assistance provided to a household at any other time upon a decrease in the household’s monthly income of $100 or more. Rental assistance contracts authorized by this subparagraph shall, except as otherwise provided in this subparagraph, be administered by the Secretary in the same manner as rental assistance contracts for projects having existing loans made or insured under section 515 or existing loans and grants made under sections 514 and 516. .
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Sec. 3
Decoupling rental assistance from maturing rural housing loans
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