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Housing and Community Development Act of 1992

*Housing & Community Development Act of 1992 (P.L. 102-550, 106 STAT. 3672)*
 
Summary:
 
The Housing and Community Development Act of 1992 ("the 1992 Act") amends a number of existing laws, including:
  • the United States Housing Act of 1937
  • the Anti-Drug Abuse Act of 1988
  • the Department of Housing and Urban Development Reform Act of 1989
  • the Housing and Community Development Amendements of 1981
  • The Cranston-Gonzales National Housing Act of 1990 ("NAHA")
  • The Federal Deposit Insurance Act and the Federal Credit Union Act
  • The Home Owners' Loan Act
  • The International Banking Act of 1978, and
  • The Right to Financial Privacy Act.

Under NAHA, Congress implemented the so-called HOME Investment Partnership Program (HOME) through which the federal government was getting involved in solving the affordable housing crisis.  The HOME Program provides eligible states and local municipal governments with allocated funds from HUD by formula.  Funds are exclusively intended to benefit low- and very low-income families.  Due to the investment partnership nature of the program, the eligible states and local governments have to match the amount of HOME fund with non-federal resources.  Before funds are awarded, state and local governments must prepare a Comprehensive Housing Affordability Strategy (CHAS).  The HOME Program also provides funds to Community Housing Development Organizations (CHDOs) for the facilitation of affordable rental or homeownership housing.  It has been noted that the purpose of the 1992 Act was to amend NAHA by removing many of its burdensome requirements.

Key Points:

  • increases the aggregate budget authority for low-income housing for year 1993 and 1994
  • excludes certain child care expenses and excessive travel expenses from the calculation of adjusted income
  • requires the General Accounting Office to audit the National Commission on Distressed Public Housing
  • addresses the eligibility of low-income families to receive rental assistance under the certificate and voucher program
  • adjusts rental assistance contractgs to reflect increases in expenses of owning and maintaining units resulting from the expiration of a real property tax exemption
  • provides for the termination of public housing tenancy for any criminal activity threatening the health, safety, or right to peaceful enjoyment of neighbors
  • directs the Secretary to evaluate and report to the Congress on progress in furthering fair housing objectives under the certificate and voucher programs
  • directs the Secretary to reduce the fund matching requirement for Homeownership and Opportunity for People Everywhere (HOPE) I (public and Indian housing) homeownership programs according to a specific formula
  • makes mutual housing associations eligible to apply for HOPE II grants (for homeownership of multifamily units)
  • rquires the Trust to assist first-time homebuyers with interst rate buy-downs and down payment assistance, but only with respect to mortgages financed with the mortgage revenue bonds
  • makes first-time homebuyers eligible for such assistance for manufactured homes and second mortgages
  • allows a nonprofit organization to provide for distribution to the seller or transferor of any proceeds remaining after repayment of the first mortgage upon the sale or transfer of any property purchased with a loan under the grant program
  • authorizes the Secretary to guarantee up to 100% of the unpaid principal and interest due on any eligible loan made to an Indian family or Indian housing authority
  • repeals certain restrictions on funds for new construction
  • makes permanent housing for disabled homeless persons, transitional housing, and single room occupancy housing eligible for affordable housing assistance funds
  • reduces participating jurisdiction maching requirements under the program
  • permits participating jurisdictions to use HOME Investment Trust Fund money to pay up to 10% of administrative costs and up to 5% for operating expenses of community housing organizations
  • allows jurisdiction contributions to take the form of state/local bond proceeds
  • requires the Secretary to reduce the matching requirements by 50% if the jurisdiction is in fiscal distress and by 100% if it is in severe fiscal distress
  • reserves certain funds for assistance for insular areas
  • terminates the Federal Housing Administration Advisory Board
  • revises the maximum amount of any mortgage the Secretary may insure
  • revises the formula for the appriased value of eligible condominium property and eligible single family property
  • requries the Secretary to report annually to the Congress on the single family mortgage insurance program
  • prohibits the Secretary from insuring a first-time buyer's mortgage whose principal amount exceeds 97% of the property's appraised value unless the mortgagor has completed an approved program of counseling on homeownership responsibilities and financial management
  • authorizes the Secretary to decrease insurance premium charges
  • makes assisted living facilities that meet criteria eligible for mortgage insurance
  • prescribes guidelines for the revocation of depository institutions' charters and the forfeiture of their franchises upon conviction for money laundering offenses or cash transaction reporting offenses
  • authorizes the Secretary to require financial institutions to implement programs to guard against money laundering through financial institutions

Why is it relevent?

Congress continues to seek solutions to address the country's housing needs for low-income families.  The purpose of the 1992 Act is to establish funding and the system of checks and balances over those government-sponsored entities/enterprises ("CSE") that are created to take care of housing needs.  For a complete summary, please refer to http://thomas.loc.gov/cgi-bin/bdquery/z?d102:HR05334:@@@D&summ2=m

Prepared by:
Natalia Garrett
Assistant Attorney General
State of Arizona, Office of the Attorney General

Last modified at 10/31/2011 10:54 AM  by SHAHEEN, ROSEMARIE