article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Affordable Housing Preservation and Revitalization Act of 2009''. SEC. 2. AFFORDABLE HOUSING PRESERVATION AND REVITALIZATION PROGRAM. Section 8 of the United States Housing Act of 1937 (42 U.S.C. 1437f) is amended by adding at the end the following: ``(ff) Affordable Housing Preservation and Revitalization Program.-- ``(1) In general.--The Secretary of Housing and Urban Development shall ensure that funds in the residual receipts account of an eligible multifamily housing property are transferred, at the time of a qualified sale or exchange, to a preservation entity. ``(2) Purpose.--The purpose of this subsection is to facilitate the transfer of multifamily housing projects with expiring housing assistance payments contracts to preservation entities that are committed to maintaining the affordability and preservation of such projects by allowing expanded access to existing residual receipts to assist with the acquisition and rehabilitation of the project. ``(3) Use of funds.--A preservation entity that acquires an eligible multifamily housing property through a qualified sale shall, subject to the approval of the housing agency, use the funds in the residual receipts account transferred to it, or for its benefit-- ``(A) to pay for rehabilitation costs approved by the housing agency; ``(B) to deposit funds into the replacement reserve account of the property; ``(C) to pay for social and other services that directly benefit the tenants of such property, but in any 1 year such payments may not exceed 10 percent of the balance of the residual receipts account of the property at the end of the prior fiscal year; ``(D) to pay for costs associated with the acquisition of the property, but such payments may not exceed 50 percent of the amount in the residual receipts account of the property at the time of acquisition; and ``(E) to pay for any other costs that have been approved by the housing agency and will directly benefit the tenants of the property. ``(4) Definitions.--In this subsection, the following definitions shall apply: ``(A) Affordability and use restrictions.--The term `affordability and use restrictions' means the affordability and use restrictions in connection with project-based housing assistance payments made under this section. ``(B) Extended use period.--The term `extended use period' means the later of-- ``(i) 30 years after the close of the sale of an eligible multifamily housing property to a preservation entity, or ``(ii) upon the expiration of the remaining useful life of the eligible multifamily property taking into account any rehabilitation undertaken in connection with the acquisition of said property by the preservation entity, as such remaining useful life is determined by the housing agency, provided that, such extended use period shall terminate in the event that the Secretary of Housing and Urban Development is unable to provide Section 8 assistance on terms at least as advantageous to the preservation entity as exist at the time of the acquisition of such eligible multifamily housing property. ``(C) Eligible multifamily housing property.--The term `eligible multifamily housing property' means a project that-- ``(i) is receiving project-based housing assistance payments under this section; and ``(ii) was financed pursuant to part 883 of title 24, Code of Federal Regulations, on or after February 29, 1980. ``(D) Housing agency.--The term `housing agency' means, with respect to any eligible multifamily housing property, the housing agency which administers housing assistance with respect to such property. ``(E) Preservation entity.--The term `preservation entity' means an entity-- ``(i) that is-- ``(I) a nonprofit corporation under State law that is exempt from Federal income taxation pursuant to paragraph (3) or (4) of section 501(c) of the Internal Revenue Code of 1986; or ``(II) a limited partnership or limited liability company where the sole general partner or sole managing member of such ownership entity is a nonprofit corporation under State law which is exempt from Federal income taxation pursuant to paragraphs (3) or (4) of section 501(c) of the Internal Revenue Code of 1986; and ``(ii) approved by the housing agency that has the capacity to acquire and preserve an eligible multifamily housing property. ``(F) Qualified sale.-- ``(i) In general.--The term `qualified sale' means the sale of an eligible multifamily housing property to a preservation entity which agrees to maintain affordability and use restrictions regarding the property that are-- ``(I) for a term of not less than the extended use period; and ``(II) legally enforceable. ``(ii) Future applicability of restrictions.--The restrictions under subparagraph (A) shall be-- ``(I) binding on all successors and assigns of the preservation entity; and ``(II) recorded as a restrictive covenant on the property pursuant to State law. ``(G) Residual receipts.--The term `residual receipts' means-- ``(i) funds generated by a property in excess of the amount needed for operating expenses, operating reserve requirements, and allowable distributions to project owners; and ``(ii) includes any other funds that the Secretary, in his or her discretion, designates as residual receipts. ``(5) Residual receipts not treated as federal funds.--For the purposes of section 42 of the Internal Revenue Code of 1986, residual receipts used or transferred under this section shall not be considered Federal funds.''.
summary: Affordable Housing Preservation and Revitalization Act of 2009 - Amends the United States Housing Act of 1937 to direct the Secretary of Housing and Urban Development (HUD) to ensure that funds in the residual receipts account of an eligible multifamily housing property are transferred, at the time of a qualified sale or exchange, to preservation entities. Requires that funds in the residual receipts account be used, subject to housing agency approval, to: (1) pay for rehabilitation costs approved by the housing agency; (2) deposit funds into the property's replacement reserve account; and (3) pay for social and other services, associated acquisition costs, and any other costs that have been approved by the housing agency and will directly benefit such tenants. Defines "preservation entity" as: (1) a nonprofit tax-exempt corporation; or (2) a limited partnership or limited liability company where the sole general partner or sole managing member of such ownership entity is a nonprofit tax-exempt corporation; and (3) that has the capacity to acquire and preserve an eligible multifamily housing property. States that, for purposes of the low-income housing credit under the Internal Revenue Code, residual receipts used or transferred under this Act shall not be considered federal funds.