Page:United States Statutes at Large Volume 111 Part 2.djvu/329

 PUBLIC LAW 105-65—OCT. 27, 1997 111 STAT. 1409 (E) projects that do not qualify as eligible multifamily housing projects pursuant to section 512(2) of this subtitle. Subtitle B—Miscellaneous Provisions SEC. 531. REHABILITATION GRANTS FOR CERTAIN INSURED PROJECTS. Section 236 of the National Housing Act (12 U.S.C. 1715z- 1) is amended by adding at the end the following: "(s) GRANT AUTHORITY. — "(1) IN GENERAL.—The Secretary may make grants for the capital costs of rehabilitation to owners of projects that meet the eligibility and other criteria set forth in, and in accordance with, this subsection. "(2) PROJECT ELIGIBILITY. — A project may be eligible for capital grant assistance under this subsection— " (A) if— "(i) the project is or was insured under any provision of title II of the National Housing Act; "(ii) the project was assisted under section 8 of the United States Housing Act of 1937 on the date of enactment of the Multifamily Assisted Housing Reform and Affordability Act of 1997; and "(iii) the project mortgage was not held by a State agency as of the date of enactment of the Multifamily /^sisted Housing Reform and Affordability Act of 1997; "(B) if the project owner agrees to maintain the housing quality standards as required by the Secretary; "(C)(i) if the Secretary determines that the owner or purchaser of the project has not engaged in material adverse financial or managerial actions or omissions with regard to such project; or "(ii) if the Secretary elects to make such determination, that the owner or purchaser of the project has not engaged in material adverse fingincial or managerial actions or omissions with regard to other projects of such owner or purchaser that are federally assisted or financed with a loan from, or mortgage insured or guaranteed by, an agency of the Federal Government; "(iii) material adverse financial or managerial actions or omissions, as the terms are used in this subparagraph, include— "(I) materially violating any Federal, State, or local law or regulation with regard to this project or any other federally assisted project, after receipt of notice and an opportunity to cure; "(II) materially breaching a contract for assistance under section 8 of the United States Housing Act of 1937, after receipt of notice and an opportunity to cure; "(III) materially violating any applicable regulatory or other agreement with the Secretary or a participating administrative entity, after receipt of notice and an opportunity to cure; "(IV) repeatedly failing to make mortgage pay- ments at times when project income was sufficient to maintain and operate the property;

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