Page:United States Statutes at Large Volume 111 Part 2.djvu/316

 Ill STAT. 1396 PUBLIC LAW 105-65—OCT. 27, 1997 that fiscal year, except that the Secretary may waive this ceiling upon a finding of special need. (3) RENT LEVELS FOR EXCEPTION PROJECTS.— For purposes of this section, a project eligible for an exception rent shall receive a rent calculated on the actual and projected costs of operating the project, at a level that provides income sufficient to support a budget-based rent that consists of— (A) the debt service of the project; (B) the operating expenses of the project, as determined by the participating administrative entity, including— (i) contributions to adequate reserves; (ii) the costs of maintenance and necessary rehabilitation; and (iii) other eligible costs permitted under section 8 of the United States Housing Act of 1937; (C) an adequate allowance for potential operating losses due to vacancies and failure to collect rents, as determined by the participating administrative entity; (D) an allowgmce for a reasonable rate of return to the owner or purchaser of the project, as determined by the participating administrative entity, which may be established to provide incentives for owners or purchasers to meet benchmarks of quality for management and housing quality; and (E) other expenses determined by the participating administrative entity to be necessary for the operation of the project. (h) EXEMPTIONS FROM RESTRUCTURING. —The following categories of projects shall not be covered by a mortgage restructuring and rental assistance sufficiency plan if— (1) the primary financing or mortgage insurance for the multifamily housing project that is covered by that expiring contract was provided by a unit of State government or a unit of general local government (or an agency or instrumentality of a unit of a State government or unit of general local government); (2) the project is a project financed under section 202 of the Housing Act of 1959 or section 515 of the Housing Act of 1949; or (3) the project has an expiring contract under section 8 of the United States Housing Act of 1937 entered into pursuant to section 441 of the Stewart B. McKinney Homeless Assistance Act. Contracts. SEC. 515. SECTION 8 RENEWALS AND LONG-TERM AFFORDABILITY 42 USC 1437f COMMITMENT BY OWNER OF PROJECT. (a) SECTION 8 RENEWALS OF RESTRUCTURED PROJECTS.— (1) PROJECT-BASED ASSISTANCE.— Subject to the availability of amounts provided in advance in appropriations Acts, and to the control of the Secretary of applicable accounts in the Treasury of the United States, with respect to an expiring section 8 contract on an eligible multifamily housing project to be renewed with project-based assistance (based on a determination under subsection (c)), the Secretary shall enter into contracts with participating administrative entities pursuant to which the participating administrative entity shall offer to renew or extend the contract, or the Secretary shall offer to note.

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