
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC12747]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                CHAPTER 130--NATIONAL AFFORDABLE HOUSING
 
             SUBCHAPTER II--INVESTMENT IN AFFORDABLE HOUSING
 
                  Part A--HOME Investment Partnerships
 
Sec. 12747. Allocation of resources


(a) In general

          (1) States and units of general local government

        After reserving amounts under paragraph (3) for the insular 
    areas, the Secretary shall allocate funds approved in an 
    appropriation Act to carry out this subchapter by formula as 
    provided in subsection (b) of this section. Of the funds made 
    available under the preceding sentence, the Secretary shall 
    initially allocate 60 percent among units of general local 
    government and 40 percent among States.

     (2) Repealed. Pub. L. 104-330, title V, Sec. 505(a)(1)(B), 
                        Oct. 26, 1996, 110 Stat. 4044

                        (3) \1\ Insular areas
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    \1\ See 1992 Amendment note below.
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        For each fiscal year, of any amounts approved in appropriation 
    Acts to carry out this subchapter, the Secretary shall reserve for 
    grants to the insular areas the greater of (A) $750,000, or (B) 0.2 
    percent of the amounts appropriated under such Acts. The Secretary 
    shall provide for the distribution of amounts reserved under this 
    paragraph among the insular areas pursuant to specific criteria for 
    such distribution, which shall be contained in a regulation issued 
    by the Secretary.

(b) Formula allocation

                           (1) In general

        (A) Basic formula

            The Secretary shall establish in \2\ regulation an 
        allocation formula that reflects each jurisdiction's share of 
        total need among eligible jurisdiction \3\ for an increased 
        supply of affordable housing for very low-income and low-income 
        families of different size, as identified by objective measures 
        of inadequate housing supply, substandard housing, the number of 
        low-income families in housing likely to be in need of 
        rehabilitation, the costs of producing housing, poverty, and the 
        relative fiscal incapacity of the jurisdiction to carry out 
        housing activities eligible under section 12742 of this title 
        without Federal assistance. Allocation among units of general 
        local government shall take into account the housing needs of 
        metropolitan cities, urban counties, and approved consortia of 
        units of general local government.
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    \2\ So in original. Probably should be ``by''.
    \3\ So in original. Probably should be ``jurisdictions''.
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        (B) Source of data

            The data to be used for formula allocation of funds within a 
        fiscal year shall be data obtained from a standard source that 
        are available to the Secretary 90 days prior to the beginning of 
        that fiscal year.

        (C) Use of basic formula

            The basic formula established under subparagraph (A) shall 
        be used for all formula allocations and reallocations provided 
        for in this part.

        (D) Weights

            When allocation is made among States, the Secretary shall 
        apply the formula in subparagraph (A) giving 20 percent weight 
        to measures of need for the whole State and 80 percent weight to 
        measures of need among units of general local government that 
        are not receiving an allocation under section 12746(1) of this 
        title.

        (E) Adjustments

            In developing the basic formula in subparagraph (A), the 
        Secretary shall (i) avoid the allocation of an excessively large 
        share of amounts made available under this part to any one State 
        or unit of general local government, and (ii) take into account 
        the need for a geographic distribution of amounts made available 
        under this part that appropriately reflects the housing need in 
        each region of the Nation.

        (F) Consultation

            The Secretary shall develop the formula in subparagraph (A) 
        in ongoing consultation with (i) the Subcommittee on Housing and 
        Urban Affairs of the Committee on Banking, Housing, and Urban 
        Affairs of the Senate, (ii) the Subcommittee on Housing and 
        Community Development of the Committee on Banking, Finance and 
        Urban Affairs of the House of Representatives, and (iii) 
        organizations representing States and units of general local 
        government. Not less than 60 days prior to publishing a formula 
        for comment, the Secretary shall submit to the Committee on 
        Banking, Housing, and Urban Affairs of the Senate and the 
        Committee on Banking, Finance and Urban Affairs of the House of 
        Representatives a copy of the formula the Secretary intends to 
        propose.

                    (2) Minimum State allocation

        (A) In general

            If the formula, when applied to funds approved under this 
        section in appropriations Acts for a fiscal year, would allocate 
        less than $3,000,000 to any State, the allocation for such State 
        shall be $3,000,000, and the increase shall be deducted pro rata 
        from the allocations of other States.

        (B) Increased minimum allocation

            If no unit of general local government within a State 
        receives an allocation under paragraph (3), the State's 
        allocation shall be increased by $500,000. Priority for use of 
        such increased allocation shall go to the provision of 
        affordable housing within the boundaries of metropolitan cities, 
        urban counties, and approved consortia within the State, based 
        on the need for such funds. The increased allocation to a State 
        under the preceding sentence shall be derived by a pro rata 
        deduction from the allocations to units of general local 
        government in all States, except that such pro rata deduction 
        shall not reduce the allocation of any unit of general local 
        government below $500,000.

                    (3) Minimum local allocation

        The Secretary shall allocate funds available for formula 
    allocation to units of general local government that, as of the end 
    of the previous fiscal year, qualified as metropolitan cities, urban 
    counties, and consortia approved by the Secretary in accordance with 
    section 12746(2) of this title so that, when all such funds are 
    initially allocated by formula, jurisdictions that are allocated an 
    amount of $500,000 or more, and participating jurisdictions (other 
    than consortia that fail to renew the membership of all of their 
    member jurisdictions) that are allocated an amount less than 
    $500,000, shall receive an allocation. Prior to announcing initial 
    allocations, the Secretary shall successively recalculate the 
    allocations to jurisdictions under this subsection so that the 
    maximum number of such jurisdictions can receive initial 
    allocations, except as provided in paragraph (4).

                       (4) Threshold reduction

        If the amount appropriated pursuant to section 12724 of this 
    title for any fiscal year is less than $1,500,000,000, then this 
    section shall be applied during that year by substituting 
    ``$335,000'' for ``$500,000'' where it appears in paragraph (3).

(c) Criteria for direct reallocation

    The Secretary shall establish objective criteria for making direct 
reallocations to any participating jurisdiction and other eligible 
entities. A jurisdiction shall be eligible for a direct reallocation 
under this subsection only if the jurisdiction, in a form acceptable to 
the Secretary, submits an application that demonstrates to the 
satisfaction of the Secretary that the jurisdiction is engaged, or has 
made good faith efforts to engage, in cooperative efforts between the 
State and appropriate participating jurisdictions within the State to 
develop, coordinate, and implement housing strategies under this 
subchapter. The Secretary shall by regulation establish objective 
selection criteria for such direct reallocations, which criteria shall 
take into account--
        (1) the applicant's demonstrated commitment to expand the supply 
    of affordable rental housing, including units developed by public 
    housing agencies, as indicated by the additional number of units of 
    affordable housing made available through production or 
    rehabilitation within the previous 2 years, making adjustment for 
    regional variations in construction and rehabilitation costs and 
    giving special consideration to the number of additional units made 
    available under this subchapter through production or 
    rehabilitation, including units developed by public housing 
    agencies, in relation to the amounts made available under this 
    program;
        (2) the applicant's actions that--
            (A) direct funds made available under this part to benefit 
        very low-income families, with a range of incomes, in amounts 
        that exceed the income targeting requirements of section 12744 
        of this title, with extra consideration given for activities 
        that expand the supply of affordable housing for very low-income 
        families whose incomes do not exceed 30 percent of the median 
        family income for the area, as determined by the Secretary;
            (B) apply the tenant selection preference categories 
        applicable under section 1437f of this title to the selection of 
        tenants for housing assisted under this part;
            (C) provide matching resources in excess of funds required 
        under section 12750 of this title; and
            (D) stimulate a high degree of investment and participation 
        in development by the private sector, including nonprofit 
        organizations; and

        (3) the degree to which the applicant is pursuing policies 
    that--
            (A) make existing housing more affordable;
            (B) remove or ameliorate any negative effects that public 
        policies identified by the applicant pursuant to section 
        12705(b)(4) of this title may have on the cost of housing or the 
        incentives to develop, maintain, or improve affordable housing 
        in the jurisdiction;
            (C) preserve the affordability of privately-owned housing 
        that is vulnerable to conversion, demolition, disinvestment, or 
        abandonment;
            (D) increase the supply of housing that is affordable to 
        very low-income and low-income persons, particularly in areas 
        that are accessible to expanding job opportunities; and
            (E) remedy the effects of discrimination and improve housing 
        opportunities for disadvantaged minorities.

(d) Reallocations

                           (1) In general

        The Secretary shall make any reallocations periodically 
    throughout each fiscal year so as to ensure that all funds to be 
    reallocated are made available to eligible jurisdictions as soon as 
    possible, consistent with orderly program administration. 
    Jurisdictions eligible for such reallocations shall include 
    participating jurisdictions and jurisdictions meeting the 
    requirements of paragraphs (3), (4), and (5) of section 12746 of 
    this title.

                           (2) Commitments

        The Secretary shall establish procedures according to which 
    participating jurisdictions may make commitments to invest funds 
    made available under this section. Such procedures shall provide for 
    appropriate stages of commitment of funds to a project from initial 
    reservation through binding commitment. Notwithstanding any other 
    provision of this subchapter, funds that the Secretary determines 
    are needed to fulfill binding commitments shall not be available for 
    reallocation.

                           (3) Limitation

        Unless otherwise specified in this part, any reallocation of 
    funds from a State shall be made only among all participating 
    States, and any reallocation of funds from units of general local 
    government shall be made only among all participating units of 
    general local government.

(Pub. L. 101-625, title II, Sec. 217, Nov. 28, 1990, 104 Stat. 4105; 
Pub. L. 102-229, title I, Dec. 12, 1991, 105 Stat. 1709; Pub. L. 102-
230, Sec. 1, Dec. 12, 1991, 105 Stat. 1720; Pub. L. 102-273, Sec. 1, 
Apr. 21, 1992, 106 Stat. 113; Pub. L. 102-389, title II, Oct. 6, 1992, 
106 Stat. 1581; Pub. L. 102-550, title II, Secs. 202(b), 203(b), 
211(a)(2), Oct. 28, 1992, 106 Stat. 3751, 3752, 3756; Pub. L. 104-330, 
title V, Sec. 505(a)(1), Oct. 26, 1996, 110 Stat. 4044; Pub. L. 105-65, 
title II, Sec. 214, Oct. 27, 1997, 111 Stat. 1366.)


                               Amendments

    1997--Subsec. (b)(3). Pub. L. 105-65, in first sentence, substituted 
``jurisdictions that are allocated an amount of $500,000 or more, and 
participating jurisdictions (other than consortia that fail to renew the 
membership of all of their member jurisdictions) that are allocated an 
amount less than $500,000, shall receive an allocation'' for ``only 
those jurisdictions that are allocated an amount of $500,000 or greater 
shall receive an allocation''.
    1996--Subsec. (a)(1). Pub. L. 104-330, Sec. 505(a)(1)(A), struck out 
``reserving amounts under paragraph (2) for Indian tribes and after'' 
after ``After''.
    Subsec. (a)(2). Pub. L. 104-330, Sec. 505(a)(1)(B), struck out 
heading and text of par. (2). Text read as follows: ``For each fiscal 
year, of the amount approved in an appropriations Act to carry out this 
subchapter, the Secretary shall reserve for grants to Indian tribes 1 
percent of the amount appropriated under such section. The Secretary 
shall provide for distribution of amounts under this paragraph to Indian 
tribes on the basis of a competition conducted pursuant to specific 
criteria for the selection of Indian tribes to receive such amounts. The 
criteria shall be contained in a regulation promulgated by the Secretary 
after notice and public comment.''
    1992--Subsec. (a)(1). Pub. L. 102-550, Sec. 211(a)(2)(A), added 
first sentence and struck out former first sentence which read as 
follows: ``After reserving amounts for Indian tribes as required by 
paragraph (2) of this subsection and after reserving amounts for the 
insular areas under paragraph (3), the Secretary shall allocate funds 
approved in an appropriations Act to carry out this subchapter by 
formula as provided in subsection (b) of this section.''
    Pub. L. 102-389 made identical amendment to those made by Pub. L. 
102-229 and Pub. L. 102-230, Sec. 1(1). See 1991 Amendment note below.
    Subsec. (a)(3). Pub. L. 102-550, Sec. 211(a)(2)(D), and Pub. L. 102-
389 both added new pars. (3) related to insular areas. The text reflects 
the par. (3) added by Pub. L. 102-550. The par. (3) added by Pub. L. 
102-389 read as follows: ``For each fiscal year, of any amounts approved 
in appropriations Acts to carry out this subchapter, the Secretary shall 
reserve for grants to the insular areas the greater of (A) $750,000, or 
(B) 0.2 percent of the amounts appropriated under such Acts. The 
Secretary shall provide for the distribution of amounts reserved under 
this paragraph among the insular areas pursuant to specific criteria for 
such distribution. The criteria shall be contained in a regulation 
promulgated by the Secretary after notice and public comment.''
    Pub. L. 102-550, Sec. 211(a)(2)(C), struck out par. (3), as added by 
Pub. L. 102-230, Sec. 1(2), which read as follows:
    ``(A) In general.--For each fiscal year, of any amount approved in 
an appropriations Act to carry out this subchapter, the Secretary shall 
reserve for grants to the insular areas an amount that reflects--
        ``(i) their share of the total population of eligible 
    jurisdictions; and
        ``(ii) any adjustments that the Secretary determines are 
    reasonable in light of available data that are related to factors 
    set forth in subsection (b)(1)(B) of this section.
    ``(B) Specific criteria.--The Secretary shall provide for the 
distribution of amounts reserved under this paragraph among the insular 
areas in accordance with specific criteria to be set forth in a 
regulation promulgated by the Secretary after notice and public comment.
    ``(C) Transitional provisions.--For fiscal year 1992, the 
reservation for insular areas specified in subparagraph (A) shall be 
made from any funds which become available for reallocation in 
accordance with the provisions of section 12746(6)(A) of this title.''
    Pub. L. 102-550, Sec. 211(a)(2)(B), struck out par. (3), as added by 
Pub. L. 102-229, which read as follows: ``For each fiscal year, of any 
amounts approved in appropriations Acts to carry out this subchapter, 
the Secretary shall reserve for grants to the insular areas the greater 
of (A) $750,000, or (B) 0.5 percent of the amounts appropriated under 
such Acts. The Secretary shall provide for the distribution of amounts 
reserved under this paragraph among the insular areas pursuant to 
specific criteria for such distribution. The criteria shall be contained 
in a regulation promulgated by the Secretary after notice and public 
comment.''
    Subsec. (b)(1)(A). Pub. L. 102-550, Sec. 203(b)(1), (6), 
redesignated subpar. (B) as (A) and struck out former subpar. (A) which 
provided for a formula for allocation of funds for production of 
affordable rental housing through new construction or substantial 
rehabilitation.
    Pub. L. 102-273 added cl. (iii) reading as follows: 
``Notwithstanding clauses (i) and (ii), any jurisdiction receiving 
amounts made available under such clause may, at the discretion of the 
jurisdiction, use such amounts for other eligible uses in accordance 
with section 12742 of this title if the jurisdiction determines that 
such use will better meet the housing needs within the jurisdiction. 
This clause shall be effective only with respect to funds provided under 
the Departments of Veterans Affairs and Housing and Urban Development, 
and Independent Agencies Appropriations Act, 1992 (Public Law 102-139; 
105 Stat. 744), which suspends the requirement of contributions by 
participating jurisdictions, and shall become ineffective if such 
requirement is reimposed.''
    Subsec. (b)(1)(B), (C). Pub. L. 102-550, Sec. 203(b)(6), 
redesignated subpars. (C) and (D) as (B) and (C), respectively. Former 
subpar. (B) redesignated (A).
    Subsec. (b)(1)(D). Pub. L. 102-550, Sec. 203(b)(6), redesignated 
subpar. (E) as (D). Former subpar. (D) redesignated (C).
    Pub. L. 102-550, Sec. 203(b)(2), substituted ``The basic formula 
established under subparagraph (A)'' for ``Except as provided in 
subparagraph (A), the basic formula established under subparagraph 
(B)''.
    Subsec. (b)(1)(E). Pub. L. 102-550, Sec. 203(b)(6), redesignated 
subpar. (F) as (E). Former subpar. (E) redesignated (D).
    Pub. L. 102-550, Sec. 203(b)(3), substituted ``formula in 
subparagraph (A)'' for ``formulas in subparagraph (B)''.
    Subsec. (b)(1)(F). Pub. L. 102-550, Sec. 203(b)(6), redesignated 
subpar. (G) as (F). Former subpar. (F) redesignated (E).
    Pub. L. 102-550, Sec. 203(b)(4), substituted ``basic formula in 
subparagraph (A)'' for ``basic formula in subparagraph (B)'' and struck 
out at end ``If a jurisdiction receives an allocation under subparagraph 
(A), the Secretary shall make such adjustments in the jurisdiction's 
allocation under the formula in subparagraph (B) as may be necessary to 
ensure that the combined effect of the formulas in subparagraphs (A) and 
(B) does not reduce the allocation of any jurisdiction below the 
allocation it would receive if allocations were made according to the 
formula under subparagraph (B) alone.''
    Subsec. (b)(1)(G). Pub. L. 102-550, Sec. 203(b)(6), redesignated 
subpar. (G) as (F).
    Pub. L. 102-550, Sec. 203(b)(5), substituted ``formula in 
subparagraph (A)'' for ``formulas in subparagraphs (A) and (B)''.
    Subsec. (b)(3). Pub. L. 102-550, Sec. 202(b)(1), inserted before 
period at end ``, except as provided in paragraph (4)''.
    Subsec. (b)(4). Pub. L. 102-550, Sec. 202(b)(2), added par. (4).
    1991--Subsec. (a)(1). Pub. L. 102-229 and Pub. L. 102-230, 
Sec. 1(1), amended par. (1) identically, inserting before first comma 
``and after reserving amounts for the insular areas under paragraph 
(3)''.
    Subsec. (a)(3). Pub. L. 102-229 and Pub. L. 102-230, Sec. 1(2), 
which were enacted on the same day, both added new pars. (3) relating to 
insular areas.

                         Change of Name

    Committee on Banking, Finance and Urban Affairs of House of 
Representatives treated as referring to Committee on Banking and 
Financial Services of House of Representatives by section 1(a) of Pub. 
L. 104-14, set out as a note preceding section 21 of Title 2, The 
Congress.


                    Effective Date of 1996 Amendment

    Amendment by Pub. L. 104-330 effective Oct. 1, 1997, except as 
otherwise expressly provided, see section 107 of Pub. L. 104-330, set 
out as an Effective Date note under section 4101 of Title 25, Indians.
    Section 505(b) of Pub. L. 104-330 provided that: ``The amendments 
under subsection (a) [amending this section and section 12838 of this 
title] shall apply with respect to amounts made available for assistance 
under title II of the Cranston-Gonzalez National Affordable Housing Act 
[42 U.S.C. 12721 et seq.] for fiscal year 1998 and fiscal years 
thereafter.''


                    Effective Date of 1992 Amendment

    Amendment by section 211(a)(2) of Pub. L. 102-550 applicable with 
respect to fiscal year 1993 and thereafter, see section 211(b) of Pub. 
L. 102-550, set out as a note under section 12704 of this title.
    Amendment by sections 202(b) and 203(b) of Pub. L. 102-550 
applicable to unexpended funds allocated under subchapter II of this 
chapter in fiscal year 1992, except as otherwise specifically provided, 
see section 223 of Pub. L. 102-550, set out as a note under section 
12704 of this title.


                    Applicability of Grant Thresholds

    Grant thresholds provided for in subsec. (b) of this section as 
amended by Pub. L. 102-550 to apply notwithstanding any other provision 
of law, see section 202(c) of Pub. L. 102-550, set out as a note under 
section 12746 of this title.


                    Expedited Issuance of Regulation

    Section 211(a)(3) of Pub. L. 102-550 provided that: ``The regulation 
referred to in the amendment made by paragraph (2)(D) [amending this 
section] shall take effect not later than the expiration of the 90-day 
period beginning on the date of the enactment of this Act [Oct. 28, 
1992]. The regulation shall not be subject to the requirements of 
subsections (b) and (c) of section 553 of title 5, United States Code, 
or section 7(o) of the Department of Housing and Urban Development Act 
[42 U.S.C. 3535(o)].''

                  Section Referred to in Other Sections

    This section is referred to in sections 12705c, 12746, 12748, 12749, 
12771, 12831 of this title.
