Sec. 102. INCOME REVIEWS

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## SEC. 102 INCOME REVIEWS ###

(a)Income Reviews for Public Housing and Section 8 Programs Section 3 of the United States Housing Act of 1937 (42 U.S.C. 1437a) is amended— ####

(1)in subsection (a)— #####

(A)in the second sentence of paragraph (1), by striking “at least annually” and inserting “pursuant to paragraph (6)”; and #####

(B)by adding at the end the following new paragraphs: > > #### “(6) Reviews of family income > > > ##### “(A) Frequency > > Reviews of family income for purposes of this section shall be made— > > > ###### “(i) > > in the case of all families, upon the initial provision of housing assistance for the family; > > > ###### “(ii) > > annually thereafter, except as provided in paragraph

(1)with respect to fixed-income families; > > > ###### “(iii) > > upon the request of the family, at any time the income or deductions (under subsection (b)(5)) of the family change by an amount that is estimated to result in a decrease of 10 percent (or such lower amount as the Secretary may, by notice, establish, or permit the public housing agency or owner to establish) or more in annual adjusted income; and > > > ###### “(iv) > > at any time the income or deductions (under subsection (b)(5)) of the family change by an amount that is estimated to result in an increase of 10 percent or more in annual adjusted income, or such other amount as the Secretary may by notice establish, except that any increase in the earned income of a family shall not be considered for purposes of this clause (except that earned income may be considered if the increase corresponds to previous decreases under clause (iii)), except that a public housing agency or owner may elect not to conduct such review in the last three months of a certification period. > > > ##### “(B) In general > > Reviews of family income for purposes of this section shall be subject to the provisions of section 904 of the Stewart B. McKinney Homeless Assistance Amendments Act of 1988 (42 U.S.C. 3544). > > > #### “(7) Calculation of income > > > ##### “(A) Use of current year income > > In determining family income for initial occupancy or provision of housing assistance pursuant to clause

(i)of paragraph (6)(A) or pursuant to reviews pursuant to clause

(iii)or

(iv)of such paragraph, a public housing agency or owner shall use the income of the family as estimated by the agency or owner for the upcoming year. > > > ##### “(B) Use of prior year income > > In determining family income for annual reviews pursuant to paragraph (6)(A)(ii), a public housing agency or owner shall, except as otherwise provided in this paragraph and paragraph (1), use the income of the family as determined by the agency or owner for the preceding year, taking into consideration any redetermination of income during such prior year pursuant to clause

(iii)or

(iv)of paragraph (6)(A). > > > ##### “(C) Other income > > In determining the income for any family based on the prior year’s income, with respect to prior year calculations of income not subject to subparagraph (B), a public housing agency or owner may make other adjustments as it considers appropriate to reflect current income. > > > ##### “(D) Safe harbor > > A public housing agency or owner may, to the extent such information is available to the public housing agency or owner, determine the family’s income prior to the application of any deductions based on timely income determinations made for purposes of other means-tested Federal public assistance programs (including the program for block grants to States for temporary assistance for needy families under part A of title IV of the Social Security Act, a program for Medicaid assistance under a State plan approved under title XIX of the Social Security Act, and the supplemental nutrition assistance program (as such term is defined in section 3 of the Food and Nutrition Act of 2008 (7 U.S.C. 2012))). The Secretary shall, in consultation with other appropriate Federal agencies, develop electronic procedures to enable public housing agencies and owners to have access to such benefit determinations made by other means-tested Federal programs that the Secretary determines to have comparable reliability. Exchanges of such information shall be subject to the same limitations and tenant protections provided under section 904 of the Stewart B. McKinney Homeless Assistance Act Amendments of 1988 (42 U.S.C. 3544) with respect to information obtained under the requirements of section 303(i) of the Social Security Act (42 U.S.C. 503(i)). > > > ##### “(E) Electronic income verification > > The Secretary shall develop a mechanism for disclosing information to a public housing agency for the purpose of verifying the employment and income of individuals and families in accordance with section 453(j)(7)(E) of the Social Security Act (42 U.S.C. 653(j)(7)(E)), and shall ensure public housing agencies have access to information contained in the ‘Do Not Pay’ system established by section 5 of the Improper Payments Elimination and Recovery Improvement Act of 2012 (Public Law 112-248; 126 Stat. 2392). > > > ##### “(F) PHA and owner compliance > > A public housing agency or owner may not be considered to fail to comply with this paragraph or paragraph

(6)due solely to any de minimis errors made by the agency or owner in calculating family incomes.” > ; ####

(2)by striking subsections

(d)and (e); and ####

(3)by redesignating subsection

(f)as subsection (d). ###

(b)Certification Regarding Hardship Exception to Minimum Monthly Rent Not later than the expiration of the 6-month period beginning on the date of the enactment of this Act, the Secretary of Housing and Urban Development shall submit to the Congress a certification that the hardship and tenant protection provisions in clause

(i)of section 3(a)(3)(B) of the United States Housing Act of 1937 (42 U.S.C. 1437a(a)(3)(B)(i)) are being enforced at such time and that the Secretary will continue to provide due consideration to the hardship circumstances of persons assisted under relevant programs of this Act. ###

(c)Income; Adjusted Income Section 3(b) of the United States Housing Act of 1937 (42 U.S.C. 1437a(b)) is amended by striking paragraphs

(4)and

(5)and inserting the following new paragraphs: > > #### “(4) Income > > The term ‘income’ means, with respect to a family, income received from all sources by each member of the household who is 18 years of age or older or is the head of household or spouse of the head of the household, plus unearned income by or on behalf of each dependent who is less than 18 years of age, as determined in accordance with criteria prescribed by the Secretary, in consultation with the Secretary of Agriculture, subject to the following requirements: > > > ##### “(A) Included amounts > > Such term includes recurring gifts and receipts, actual income from assets, and profit or loss from a business. > > > ##### “(B) Excluded amounts > > Such term does not include— > > > ###### “(i) > > any imputed return on assets, except to the extent that net family assets exceed $50,000, except that such amount (as it may have been previously adjusted) shall be adjusted for inflation annually by the Secretary in accordance with an inflationary index selected by the Secretary; > > > ###### “(ii) > > any amounts that would be eligible for exclusion under section 1613(a)(7) of the Social Security Act (42 U.S.C. 1382b(a)(7)); > > > ###### “(iii) > > deferred disability benefits from the Department of Veterans Affairs that are received in a lump sum amount or in prospective monthly amounts; > > > ###### “(iv) > > any expenses related to aid and attendance under section 1521 of title 38, United States Code, to veterans who are in need of regular aid and attendance; and > > > ###### “(v) > > exclusions from income as established by the Secretary by regulation or notice, or any amount required by Federal law to be excluded from consideration as income. > > > ##### “(C) Earned income of students > > Such term does not include— > > > ###### “(i) > > earned income, up to an amount as the Secretary may by regulation establish, of any dependent earned during any period that such dependent is attending school or vocational training on a full-time basis; or > > > ###### “(ii) > > any grant-in-aid or scholarship amounts related to such attendance used— > > > ###### “(I) > > for the cost of tuition or books; or > > > ###### “(II) > > in such amounts as the Secretary may allow, for the cost of room and board. > > > ##### “(D) Educational savings accounts > > Income shall be determined without regard to any amounts in or from, or any benefits from, any Coverdell education savings account under section 530 of the Internal Revenue Code of 1986 or any qualified tuition program under section 529 of such Code. > > > ##### “(E) Recordkeeping > > The Secretary may not require a public housing agency or owner to maintain records of any amounts excluded from income pursuant to this subparagraph. > > > #### “(5) Adjusted income > > The term ‘adjusted income’ means, with respect to a family, the amount (as determined by the public housing agency or owner) of the income of the members of the family residing in a dwelling unit or the persons on a lease, after any deductions from income as follows: > > > ##### “(A) Elderly and disabled families > > $525 in the case of any family that is an elderly family or a disabled family. > > > ##### “(B) Minors, students, and persons with disabilities > > $480 for each member of the family residing in the household (other than the head of the household or his or her spouse) who is less than 18 years of age or is attending school or vocational training on a full-time basis, or who is 18 years of age or older and is a person with disabilities. > > > ##### “(C) Child care > > Any reasonable child care expenses necessary to enable a member of the family to be employed or to further his or her education. > > > ##### “(D) Health and medical expenses > > The amount, if any, by which 10 percent of annual family income is exceeded by the sum of— > > > ###### “(i) > > in the case of any elderly or disabled family, any unreimbursed health and medical care expenses; and > > > ###### “(ii) > > any unreimbursed reasonable attendant care and auxiliary apparatus expenses for each handicapped member of the family, if determined necessary by the public housing agency or owner to enable any member of such family to be employed. > > The Secretary shall, by regulation, provide hardship exemptions to the requirements of this subparagraph and subparagraph

(C)for impacted families who demonstrate an inability to pay calculated rents because of financial hardship. Such regulations shall include a requirement to notify tenants regarding any changes to the determination of adjusted income pursuant to such subparagraphs based on the determination of the family’s claim of financial hardship exemptions required by the preceding sentence. Such regulations shall be promulgated in consultation with tenant organizations, industry participants, and the Secretary of Health and Human Services, with an adequate comment period provided for interested parties. > > > ##### “(E) Permissive deductions > > Such additional deductions as a public housing agency may, at its discretion, establish, except that the Secretary shall establish procedures to ensure that such deductions do not materially increase Federal expenditures. > > The Secretary shall annually calculate the amounts of the deductions under subparagraphs

(A)and (B), as such amounts may have been previously calculated, by applying an inflationary factor as the Secretary shall, by regulation, establish, except that the actual deduction determined for each year shall be established by rounding such amount to the next lowest multiple of $25.” > . ###

(d)Housing Choice Voucher Program Section 8(o) of the United States Housing Act of 1937 (42 U.S.C. 1437f(o)) is amended— ####

(1)in paragraph (1)(D), by inserting before the period at the end the following: “, except that a public housing agency may establish a payment standard of not more than 120 percent of the fair market rent where necessary as a reasonable accommodation for a person with a disability, without approval of the Secretary. A public housing agency may use a payment standard that is greater than 120 percent of the fair market rent as a reasonable accommodation for a person with a disability, but only with the approval of the Secretary. In connection with the use of any increased payment standard established or approved pursuant to either of the preceding two sentences as a reasonable accommodation for a person with a disability, the Secretary may not establish additional requirements regarding the amount of adjusted income paid by such person for rent”; and ####

(2)in paragraph (5)— #####

(A)in the paragraph heading, by striking “Annual review” and inserting “Reviews”; #####

(B)in subparagraph (A)— ######

(i)by striking “the provisions of” and inserting “paragraphs (1), (6), and

(7)of section 3(a) and to”; and ######

(ii)by striking “and shall be conducted” and all that follows through the end of the subparagraph and inserting a period; and #####

(C)in subparagraph (B), by striking the second sentence. ###

(e)Enhanced Voucher Program Section 8(t)(1)(D) of the United States Housing Act of 1937 (42 U.S.C. 1437f(t)(1)(D)) is amended by striking “income” each place such term appears and inserting “annual adjusted income”. ###

(f)Project-Based Housing Paragraph

(3)of section 8(c) of the United States Housing Act of 1937 (42 U.S.C. 1437f(c)(3)) is amended by striking the last sentence. ###

(g)Impact on Public Housing Revenues **[**[42 U.S.C. 1437a note](/us/usc/t42/s1437a)**]** ####

(1)Adjustments to operating formula If the Secretary of Housing and Urban Development determines that the application of subsections

(a)through

(e)of this section results in a material and disproportionate reduction in the rental income of certain public housing agencies during the first year in which such subsections are implemented, the Secretary may make appropriate adjustments in the formula income for such year of those agencies experiencing such a reduction. ####

(2)HUD reports on revenue and cost impact In each of the first two years after the first year in which subsections

(a)through

(e)are implemented, the Secretary of Housing and Urban Development shall submit a report to Congress identifying and calculating the impact of changes made by such subsections and section 104 of this Act on the revenues and costs of operating public housing units, the voucher program for rental assistance under section 8 of the United States Housing Act of 1937, and the program under such section 8 for project-based rental assistance. If such report identifies a material reduction in the net income of public housing agencies nationwide or a material increase in the costs of funding the voucher program or the project-based assistance program, the Secretary shall include in such report recommendations for legislative changes to reduce or eliminate such a reduction. ###

(h)Effective Date **[**[42 U.S.C. 1437a note](/us/usc/t42/s1437a)**]** The Secretary of Housing and Urban Development shall issue notice or regulations to implement this section and this section shall take effect after such issuance, except that this section may only take effect upon the commencement of a calendar year. ###

(i)Study on Impact on Elderly and Disabled Families of Decreased Deductions in Income ####

(1)Study The Secretary of Housing and Urban Development shall conduct a study to determine the impacts, on rents paid by elderly and disabled individuals and families assisted under the section 8 rental assistance and public housing programs under the United States Housing Act of 1937 (42 U.S.C. 1437 et seq.), of any decreases in the amounts of any deductions from income (for purposes of section 3(b) of such Act (42 U.S.C. 1437a(b))), as compared to such deductions under such section 3(b) as in effect before the effectiveness of this section, resulting from the amendments made by this section. ####

(2)Report The Secretary shall submit to the Congress a report setting forth the results of the study conducted pursuant to paragraph

(1)not later than the expiration of the 12-month period beginning on the date of the enactment of this Act. ####

(3)Effective Date Notwithstanding subsection

(h)of this section, this subsection shall take effect on the date of the enactment of this Act.

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