HUD Inspection Process and Enforcement Reform Act of 2019
This bill authorizes the Department of Housing and Urban Development (HUD) to remove or reduce the pay of certain HUD employees for misconduct or performance. The bill also requires an entity receiving housing assistance payments for a dwelling unit to ensure that the unit is maintained to safe and sanitary conditions and authorizes HUD to take enforcement actions for failure to meet certain maintenance standards.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4023 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 4023
To reform the inspection process of housing assisted by the Department
of Housing and Urban Development, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 25, 2019
Mr. Ferguson introduced the following bill; which was referred to the
Committee on Financial Services
_______________________________________________________________________
A BILL
To reform the inspection process of housing assisted by the Department
of Housing and Urban Development, 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 Process and
Enforcement Reform Act of 2019''.
SEC. 2. REDUCTION IN GRADE OR PAY OR REMOVAL FOR MISCONDUCT OR
PERFORMANCE OF EMPLOYEES OF THE DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT.
(a) In General.--Section 7(c) of the Department of Housing and
Urban Development Act (42 U.S.C. 3535(c)) is amended--
(1) by striking ``The Secretary is authorized'' and
inserting the following: ``Employment, Compensation, Authority,
and Duties of Personnel.--
``(1) In general.--The Secretary is authorized''; and
(2) by adding at the end the following:
``(2) Reduction in grade or pay or removal for misconduct
or performance of employees.--
``(A) Definitions.--For purposes of this
paragraph--
``(i) the term `covered employee'--
``(I) means an individual holding a
position in the civil service in the
Department; and
``(II) does not include any
individual--
``(aa) holding in a
position described under
sections 5312 through 5316 of
title 5, United States Code
(relating to the Executive
Schedule);
``(bb) holding a position
as a limited term appointee,
limited emergency appointee, or
noncareer appointee in the
Senior Executive Service, as
defined under paragraphs (5),
(6), and (7), respectively, of
section 3132(a) of title 5,
United States Code; or
``(cc) holding a position
of a confidential or policy-
determining character under
schedule C of subpart C of part
213 of title 5, Code of Federal
Regulations;
``(ii) the term `grade' means a level of
classification under a position classification
system;
``(iii) the term `misconduct' includes
neglect of duty, malfeasance, or failure to
accept a directed reassignment or to accompany
a position in a transfer of function; and
``(iv) the term `pay' means the rate of
basic pay fixed by law or administrative action
for the position held by a covered employee.
``(B) Actions covered.--This paragraph--
``(i) applies to a reduction in grade or
pay or removal; and
``(ii) does not apply to--
``(I) a reduction in grade or pay
or removal under section 7512 of title
5, United States Code;
``(II) a reduction in grade or pay
or removal under section 7521 of title
5, United States Code;
``(III) a removal under section
7532 of title 5, United States Code; or
``(IV) a removal under section
3592, 3595, or 7543 of title 5, United
States Code.
``(C) Cause and procedure.--
``(i) In general.--Notwithstanding any
other provision of law, under regulations
prescribed by the Office of Personnel
Management, the Secretary may, if the Secretary
determines that the misconduct or performance
of a covered employee warrants such action--
``(I) remove the covered employee
from the civil service;
``(II) reduce the grade of the
covered employee; or
``(III) reduce the pay of the
covered employee.
``(ii) Reduction in grade.--A covered
employee subject to a reduction in grade under
clause (i)(II) shall, beginning on the date
that the reduction takes effect, receive the
annual rate of pay applicable to the reduced
grade.
``(iii) Appeal procedures.--
``(I) In general.--Subject to
subclause (II) and clause (iv), any
reduction in grade or pay or removal
under this paragraph may be appealed to
the Merit Systems Protection Board
under section 7701 of title 5, United
States Code.
``(II) Time for appeal.--An appeal
under subclause (I) may only be made if
such appeal is made not later than 7
days after the date of such reduction
in grade or pay or removal.
``(iv) Review on appeal.--
``(I) In general.--Upon receipt of
an appeal under clause (iii), the Merit
Systems Protection Board shall refer
the appeal to an administrative law
judge pursuant to section 7701(b)(1) of
title 5, United States Code. The
administrative law judge shall expedite
any such appeal under such section and,
in any such case, shall issue a
decision not later than 45 days after
the date that the Board receives the
appeal.
``(II) Information and
assistance.--To the maximum extent
practicable, the Secretary shall
provide to the Merit Systems Protection
Board, and to any administrative law
judge to whom an appeal under this
paragraph is referred, such information
and assistance as may be necessary to
ensure an appeal under this paragraph
is expedited.
``(III) Finality.--Notwithstanding
any other provision of law, including
section 7703 of title 5, United States
Code, the decision of an administrative
law judge under subclause (I) shall be
final and shall not be subject to any
further appeal.
``(IV) Delayed decision.--In any
case in which the administrative law
judge cannot issue a decision in
accordance with the 45-day requirement
under subclause (I), the reduction in
grade or pay or removal is final. In
such a case, the Merit Systems
Protection Board shall, within 14 days
after the date that such reduction in
grade or pay or removal is final,
submit to Congress a report that
explains the reasons why a decision was
not issued in accordance with such
requirement.
``(V) No stays.--The Merit Systems
Protection Board or administrative law
judge may not stay any reduction in
grade or pay or removal action under
this paragraph.
``(VI) Effect of appeal of
removal.--During the period beginning
on the date on which a covered employee
appeals a removal from the civil
service under this paragraph and ending
on the date that the administrative law
judge issues a final decision on such
appeal, the covered employee may not
receive any pay, awards, bonuses,
incentives, allowances, differentials,
student loan repayments, special
payments, or benefits.
``(v) Whistleblower protection.--In the
case of a covered employee seeking corrective
action (or on behalf of whom corrective action
is sought) from the Office of Special Counsel
based on an alleged prohibited personnel
practice described in section 2302(b) of title
5, United States Code, the Secretary may not
reduce the grade or pay or remove the covered
employee under this paragraph without the
approval of the Special Counsel under section
1214(f) of title 5, United States Code.''.
(b) Application.--The authority under paragraph (2) of section 7(c)
of the Department of Housing and Urban Development Act, as added by
subsection (a), shall apply to any covered employee (as defined in such
paragraph) appointed before, on, or after the date of enactment of this
Act.
(c) Conforming Amendments.--Title 5, United States Code, is
amended--
(1) in section 4303(f)--
(A) in paragraph (3), by striking ``or'' at the
end;
(B) in paragraph (4), by striking the period at the
end and inserting ``, or''; and
(C) by adding at the end the following:
``(5) the reduction in grade or removal of an employee
under section 7(c)(2) of the Department of Housing and Urban
Development Act (42 U.S.C. 3535(c)(2)).'';
(2) in section 7512--
(A) in subparagraph (E), by striking ``; or'' and
inserting a comma;
(B) in subparagraph (F), by striking the period at
the end and inserting ``, or''; and
(C) by adding at the end the following:
``(G) a reduction in grade or pay or removal under section
7(c)(2) of the Department of Housing and Urban Development Act
(42 U.S.C. 3535(c)(2)).'';
(3) in section 7521(b), in the matter following paragraph
(5)--
(A) in subparagraph (B), by striking ``or'' at the
end;
(B) in subparagraph (C), by striking the period at
the end and inserting ``; or''; and
(C) by adding at the end the following:
``(D) a reduction in grade or pay or removal under section
7(c)(2) of the Department of Housing and Urban Development Act
(42 U.S.C. 3535(c)(2)).''; and
(4) in section 7542, by striking ``or to a removal under
section 3592 or 3595 of this title'' and inserting ``to a
removal under section 3592 or 3595 of this title, to an action
under section 713 of title 38, or to a reduction in grade or
pay or removal under section 7(c)(2) of the Department of
Housing and Urban Development Act (42 U.S.C. 3535(c)(2))''.
SEC. 3. ENFORCEMENT OF PHYSICAL CONDITION STANDARDS AND TENANT
PROTECTION.
Section 8(o) of the United States Housing Act of 1937 (42 U.S.C.
1437f(o)) is amended by adding at the end the following:
``(21) 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.
``(22) 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 a Uniform
Physical Condition Standards (in this paragraph
referred to as `UPCS') inspection score of not
more than 30;
``(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; or
``(iii) the project receives a UPCS
inspection score of more than 30 and less than
59 and has received consecutive scores of less
than 60 on UPCS inspections.
``(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 paragraph (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), (ii), or (iii) of subparagraph (A),
the Secretary shall notify the entity and
provide an opportunity for response not later
than 15 days after the date on which the
results of the UPCS inspection are issued.
``(ii) Plan and notice of default.--If
violations remain at a project after the 15-day
period described in clause (i), the Secretary
shall--
``(I) develop a plan to bring the
project into compliance not later than
30 days after the date on which the
results of the UPCS inspection are
issued; and
``(II) provide the owner, the
tenants of the property, the local
government, any mortgagees, and any
contract administrator of the project
with a Notice of Default with a
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
a UPCS 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 may--
``(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; or
``(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 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,
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 a UPCS 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--
``(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.
``(23) 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. 4. REPORTS ON REAL ESTATE ASSESSMENT CENTER INSPECTIONS.
(a) HUD Report.--Not later than 90 days after the date of enactment
of this Act, the Secretary of Housing and Urban Development shall issue
a publicly available report on the website of the Department of Housing
and Urban Development (in this section referred to as the
``Department'') regarding Real Estate Assessment Center (in this
section referred to as ``REAC'') inspections of all properties
assisted, insured, or both, under a program of the Department, which
shall include--
(1) the percentage of all inspected properties that
received a REAC-inspected score of less than 65 within the 48-
month period preceding the report;
(2) the number of properties in which the most recent REAC-
inspected score represented a decline relative to the previous
REAC-inspected score;
(3) a list of the 10 metropolitan statistical areas with
the lowest average REAC-inspected scores for all inspected
properties; and
(4) a list of the 10 States with the lowest average REAC-
inspected scores for all inspected properties.
(b) GAO Report.--The Comptroller General of the United States shall
issue a publicly available report on the website of the Government
Accountability Office regarding areas in which REAC inspections of all
properties assisted, insured, or both, under a program of the
Department should be reformed and improved.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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