HUD Inspection Oversight Act of 2019
This bill modifies inspection and oversight protocols under the Housing Choice Voucher Program, including by directing the Department of Housing and Urban Development (HUD) to take certain enforcement actions when a property's inspection score falls below a specified threshold. In recent years, language directing HUD to take specific actions in such circumstances has been included in annual appropriations bills.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3745 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 3745
To provide physical standards and reform the inspection process for
housing assisted under section 8 of the United States Housing Act of
1937, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 12, 2019
Mr. Lawson of Florida (for himself, Ms. Adams, Ms. Velazquez, Mr.
Crist, Mr. Bishop of Georgia, Mr. Raskin, Ms. Norton, Mr. McGovern, Ms.
Pressley, Ms. Lee of California, Mrs. Carolyn B. Maloney of New York,
Ms. Garcia of Texas, Ms. Roybal-Allard, Mrs. Demings, Mr. Vargas, and
Mr. Lynch) introduced the following bill; which was referred to the
Committee on Financial Services
_______________________________________________________________________
A BILL
To provide physical standards and reform the inspection process for
housing assisted under section 8 of the United States Housing Act of
1937, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``HUD Inspection Oversight Act of
2019''.
SEC. 2. ENFORCEMENT OF PHYSICAL CONDITION STANDARDS AND TENANT
PROTECTION.
Section 8(c) of the United States Housing Act of 1937 (42 U.S.C.
1437f(c)) is amended by adding at the end the following:
``(9) Maintenance of property.--Any entity receiving
housing assistance payments with respect to dwelling units
covered by a housing assistance payments contract shall--
``(A) maintain decent, safe, and sanitary
conditions at those dwelling units, as determined by
the Secretary; and
``(B) comply with any standards under applicable
State or local laws, rules, ordinances, or regulations
relating to the physical condition of those dwelling
units.
``(10) Enforcement of physical condition standards.--
``(A) In general.--The Secretary shall take action
under subparagraph (C) against an entity with a housing
assistance payments contract for project-based
assistance with respect to a multifamily housing
project if--
``(i) the project receives an inspection
score of not more than 60; or
``(ii) the entity fails to certify in
writing to the Secretary within 3 days of
receiving the score under clause (i) that all
exigent health and safety deficiencies
identified by the inspector at the project have
been corrected.
``(B) Applicability.--Subparagraph (A) shall--
``(i) apply with respect to insured and
noninsured projects with dwelling units
receiving assistance under this section other
than under subsection (o)(13); and
``(ii) not apply to dwelling units
receiving assistance with capital or operating
funds under section 9.
``(C) Notification and enforcement.--
``(i) In general.--If an entity violates
clause (i) or (ii) of subparagraph (A), within
15 days after the results of the inspection the
Secretary shall issue the entity a Notice of
Default, which shall provide for a reasonable
period to cure all project deficiencies and for
the entity to provide any response determined
appropriate by the Secretary.
``(ii) Plan and notice of default.--If
violations remain at a project after the
expiration of the cure period prescribed by the
Secretary in the Notice of Default pursuant to
clause (i), the Secretary shall--
``(I) develop a remediation plan,
separate from the Notice of Default,
and in consultation with tenants or
legitimate tenant organizations, or
both, not later than 45 days after the
expiration of the cure period
prescribed by the Secretary in the
Notice of Default, to bring the project
into compliance;
``(II) provide the owner with the
remediation plan with a specified
timetable, determined by the Secretary,
for correcting all project
deficiencies, and
``(III) provide the tenants of the
property, legitimate tenant
organizations, the local government,
any mortgagees, and any contract
administrator of the project with the
Notice of Default and the remediation
plan with the specified timetable,
determined by the Secretary, for
correcting all deficiencies.
``(iii) Withdrawal of notice of default.--
If an appeal submitted by the entity results in
an inspection score of not less than 60, the
Secretary may withdraw a Notice of Default
issued under clause (ii)(II).
``(iv) Penalties.--If, at the end of the
timetable described in clause (ii)(II), the
entity fails to fully correct all deficiencies
in the project, the Secretary shall take one or
more of the following actions, and provide
additional notice of those actions to the
owner, the tenants of the property, legitimate
tenant organizations, the local government, any
mortgagees, and any contract administrator:
``(I) Require immediate replacement
of project management with a management
agent approved by the Secretary.
``(II) Impose civil money
penalties, which shall be used solely
for the purpose of supporting safe and
sanitary conditions at the property, as
designated by the Secretary, with
priority given to the tenants of the
property affected by the penalty.
``(III) Abate the housing
assistance payments contract under this
section, including partial abatement,
as determined by the Secretary, until
all deficiencies have been corrected.
``(IV) Pursue transfer of the
project to an owner, approved by the
Secretary under established procedures,
which will be obligated to promptly
make all required repairs and to accept
renewal of the housing assistance
payments contract as long as such
renewal is offered.
``(V) Transfer the existing housing
assistance payments contract under this
section to another project or projects
and owner or owners.
``(VI) Pursue exclusionary
sanctions, including suspensions or
debarments from Federal programs.
``(VII) Seek judicial appointment
of a receiver to manage the property
and cure all project deficiencies or
seek a judicial order of specific
performance requiring the owner to cure
all project deficiencies.
``(VIII) Work with the owner,
lender, or other related party to
stabilize the property in an attempt to
preserve the property through
compliance, transfer of ownership, or
an infusion of capital provided by a
third-party that requires time to
effectuate.
``(IX) Take any other regulatory or
contractual remedies available as
deemed necessary and appropriate by the
Secretary.
``(D) Contracts.--
``(i) In general.--The Secretary shall take
appropriate steps to ensure that project-based
contracts remain in effect, subject to the
exercise of contractual abatement remedies to
assist relocation of tenants for major threats
to health and safety after written notice to
and informed consent of the affected tenants
and use of other remedies under this paragraph.
``(ii) Other assistance.--To the extent the
Secretary determines, in consultation with the
tenants, legitimate tenant organizations, and
the local government, that a property is not
feasible for continued rental assistance
payments under this section or other housing
programs, based on consideration of the costs
of rehabilitating and operating the property
and all available Federal, State, and local
resources, including rent adjustments under
section 524 of the Multifamily Assisted Housing
Reform and Affordability Act of 1997 (42 U.S.C.
1437f note) and environmental conditions that
cannot be remedied in a cost-effective fashion,
the Secretary may, in consultation with the
tenants of the property and any legitimate
tenant organizations, contract for project-
based rental assistance payments with an owner
or owners of other existing housing properties,
or provide other rental assistance.
``(E) Report.--
``(i) In general.--The Secretary shall, on
a quarterly basis, issue a publicly available
report on all properties covered by this
paragraph that--
``(I) are assessed through the Real
Estate Assessment Center; and
``(II)(aa) have an inspection score
of less than 60; or
``(bb) received an unsatisfactory
management and occupancy review during
the 36-month period preceding the
report.
``(ii) Contents.--Each report issued under
clause (i) shall include specific information,
disaggregated by the property to which it
relates, regarding--
``(I) the enforcement actions being
taken to address the physical
conditions of the properties covered in
the report, including imposition of
civil money penalties and termination
of subsidies, and identify properties
that have those conditions multiple
times;
``(II) actions that the Department
of Housing and Urban Development is
taking to protect tenants of those
properties; and
``(III) any administrative or
legislative recommendations to further
improve the living conditions at each
property covered under a housing
assistance payments contract.
``(11) Tenant protection.--
``(A) In general.--The Secretary may provide
tenant-based assistance for dwelling units covered
under a project-based assistance subsidy contract if--
``(i) the owner of the dwelling units has
received a Notice of Default; and
``(ii) the dwelling units pose an imminent
health and safety risk to the tenants of those
dwelling units.
``(B) Reimbursements.--To the extent that the
Secretary determines that dwelling units described in
subparagraph (A) are not feasible for continued rental
assistance payments or transfer of the project-based
assistance subsidy contract associated with those
dwelling units to another project or projects and owner
or owners, any remaining amounts associated with those
dwelling units shall be recaptured and used to
reimburse amounts used for tenant-based assistance
under subparagraph (A).''.
SEC. 3. STANDARDS FOR PHYSICAL CONDITION AND MANAGEMENT OF HOUSING
RECEIVING ASSISTANCE PAYMENTS.
Section 8 of the United States Housing Act of 1937 (42 U.S.C.
1437f) is amended by inserting after subsection (v) the following:
``(w) Standards for Physical Condition and Management of Housing
Receiving Assistance Payments.--
``(1) Standards for physical condition and management of
housing.--Any entity receiving assistance payments under this
section shall maintain decent, safe, and sanitary conditions,
as determined by the Secretary, for any structure covered under
a housing assistance payment contract.
``(2) Survey of tenants.--
``(A) In general.--The Secretary shall, on a
semiannual basis, conduct a survey of the tenants of
each structure covered under a housing assistance
payment contract for the purpose of identifying
consistent or persistent problems with the physical
condition of the structure or performance of the
manager of the structure.
``(B) Confidentiality.--The Secretary shall ensure
that the surveys pursuant to subparagraph (A) are
conducted in an anonymous manner such that the
identities of tenants identifying such problems through
such survey are not disclosed.
``(3) Remediation.--If a consistent or persistent problem
with the structure or the management of the structure covered
under a housing assistance payment contract is identified--
``(A) by the Secretary pursuant a survey conducted
under paragraph (2), the Secretary shall undertake
remediation for the structure or manager; or
``(B) by the Performance-Based Contract
Administrator based on any other observation made by
the Administrator during the normal course of business,
the Administrator shall refer the structure or manager
to the Secretary for remediation.
``(4) Penalty for failure to uphold standards.--
``(A) In general.--The Secretary may impose a
penalty on any owner of a structure covered under a
housing assistance payment contract if the Secretary
finds that the structure or manager of the structure--
``(i) did not satisfactorily meet the
requirements under paragraph (1); or
``(ii) is repeatedly referred to the
Secretary for remediation by a Performance-
Based Contract Administrator through the
process established under paragraph (3).
``(B) Amount.--A penalty imposed under subparagraph
(A) shall be in an amount equal to not less than 1
percent of the annual budget authority the owner is
allocated under a housing assistance payment contract.
``(C) Use of amounts.--Any amounts collected under
this paragraph shall be used solely for the purpose of
supporting safe and sanitary conditions at applicable
structures or for tenant relocation, as designated by
the Secretary, with priority given to the tenants of
the structure that led to the penalty.
``(5) Applicability.--This subsection shall not apply to
any property assisted under subsection (o).''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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