H.R. 2038

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2038 Introduced in House (IH)]

<DOC>

119th CONGRESS
1st Session
H. R. 2038

To make housing more affordable, and for other purposes.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

March 11, 2025

Mr. Cleaver (for himself, Ms. Ansari, Ms. Bonamici, Mr. Fields, Mr. 
Figures, Mr. Frost, Mr. Garcia of Illinois, Mr. Green of Texas, Mr. 
Gomez, Ms. Norton, Mr. Jackson of Illinois, Mr. Khanna, Mr. McGovern, 
Mrs. McIver, Ms. Moore of Wisconsin, Mr. Nadler, Ms. Ocasio-Cortez, Ms. 
Omar, Ms. Pressley, Mrs. Ramirez, Ms. Schakowsky, Mr. Thanedar, Mr. 
Thompson of Mississippi, and Ms. Tlaib) introduced the following bill; 
which was referred to the Committee on Financial Services, and in 
addition to the Committees on the Judiciary, Veterans' Affairs, and 
Ways and Means, for a period to be subsequently determined by the 
Speaker, in each case for consideration of such provisions as fall 
within the jurisdiction of the committee concerned

_______________________________________________________________________

A BILL

To make housing more affordable, and for other purposes.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``American Housing 
and Economic Mobility Act of 2025''.
(b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
TITLE I--MAKING HOUSING MORE AFFORDABLE

Sec. 101. Local housing innovation grants.
Sec. 102. Investing in affordable housing infrastructure.
Sec. 103. Conditions for the sale of real estate-owned properties and 
non-performing loans.
TITLE II--TAKING THE FIRST STEPS TO REVERSE THE LEGACY OF HOUSING 
DISCRIMINATION AND GOVERNMENT NEGLIGENCE

Sec. 201. Down payment assistance program for first-time, first-
generation homebuyers.
Sec. 202. Formula grant program for communities with an appraisal gap.
Sec. 203. Strengthening the Community Reinvestment Act of 1977.
Sec. 204. Amendments relating to credit union service to underserved 
areas.
Sec. 205. Raising public welfare caps.
Sec. 206. Temporary eligibility of certain direct descendants of 
certain veterans for housing loans 
guaranteed by the Secretary of Veterans 
Affairs.
TITLE III--REMOVING BARRIERS THAT ISOLATE COMMUNITIES

Sec. 301. Expanding rights under the Fair Housing Act.
Sec. 302. Improving outcomes in housing assistance programs.
TITLE IV--ESTATE TAX REFORM

Sec. 401. Amendment to Internal Revenue Code of 1986.
Sec. 402. Rate adjustment.
Sec. 403. Required minimum 10-year term, etc., for grantor retained 
annuity trusts.
Sec. 404. Certain transfer tax rules applicable to grantor trusts.
Sec. 405. Elimination of generation-skipping transfer tax exemption for 
transfers to certain persons.
Sec. 406. Simplifying gift tax exclusion for annual gifts.
Sec. 407. Clarification regarding disallowance of step-up in basis for 
property held in certain grantor trusts.
Sec. 408. Limitation on discounts; valuation rules for certain 
transfers of nonbusiness assets.
Sec. 409. Surcharge on high income estates and trusts.
Sec. 410. Modification of rules for value of certain farm, etc., real 
property.
Sec. 411. Modification of estate tax rules with respect to land subject 
to conservation easements.
TITLE V--ACCESSIBILITY REQUIREMENTS

Sec. 501. Accessibility requirements.

TITLE I--MAKING HOUSING MORE AFFORDABLE

SEC. 101. LOCAL HOUSING INNOVATION GRANTS.

(a) Definitions.--In this section:
(1) Elementary school; secondary school.--The terms 
``elementary school'' and ``secondary school'' have the 
meanings given those terms in section 8101 of the Elementary 
and Secondary Education Act of 1965 (20 U.S.C. 7801).
(2) Eligible entity.--The term ``eligible entity'' means--
(A) a State;
(B) a unit of general local government; or
(C) an Indian tribe.
(3) Indian tribe.--The term ``Indian tribe'' has the 
meaning given the term in section 4 of the Native American 
Housing Assistance and Self-Determination Act of 1996 (25 
U.S.C. 4103).
(4) Institution of higher education.--The term 
``institution of higher education'' has the meaning given the 
term in section 101 of the Higher Education Act of 1965 (20 
U.S.C. 1001).
(5) Metropolitan area; state; unit of general local 
government.--The terms ``metropolitan area'', ``State'', and 
``unit of general local government'' have the meanings given 
those terms in section 102 of the Housing and Community 
Development Act of 1974 (42 U.S.C. 5302).
(6) Secretary.--The term ``Secretary'' means the Secretary 
of Housing and Urban Development.
(b) Establishment.--Not later than 1 year after the date of 
enactment of this Act, the Secretary shall establish a program to award 
grants on a competitive basis to eligible entities to--
(1) reform local land use restrictions to bring down the 
costs of producing affordable housing; and
(2) remove unnecessary barriers to building affordable 
units in their communities.
(c) Eligible Activities.--An eligible entity receiving a grant 
under this section may use funds to--
(1) carry out any of the activities described in section 
105 of the Housing and Community Development Act of 1974 (42 
U.S.C. 5305);
(2) carry out any of the activities permitted under the 
Local and Regional Project Assistance Program under section 
6702 of title 49, United States Code; or
(3) modernize, renovate, or repair facilities used by 
public elementary schools, public secondary schools, and public 
institutions of higher education, including modernization, 
renovation, and repairs that--
(A) promote physical, sensory, and environmental 
accessibility; and
(B) are consistent with a recognized green building 
rating system.
(d) Application.--
(1) In general.--An eligible entity desiring a grant under 
this section shall submit to the Secretary an application that 
demonstrates that the eligible entity has carried out, or is in 
the process of carrying out, initiatives that facilitate the 
expansion of the supply of well-located affordable housing.
(2) Activities.--Initiatives that meet the criteria 
described in paragraph (1)--
(A) include--
(i) establishing ``by-right'' development, 
which allows jurisdictions to administratively 
approve new developments that are consistent 
with their zoning code;
(ii) revising or eliminating off-street 
parking requirements to reduce the cost of 
housing production;
(iii) instituting measures that incentivize 
owners of vacant land to redevelop the space 
into affordable housing or other productive 
uses;
(iv) revising minimum lot size requirements 
and bans or limits on multifamily construction 
to allow for denser and more affordable 
development;
(v) instituting incentives to promote dense 
development, such as density bonuses;
(vi) passing inclusionary zoning ordinances 
that require a portion of newly developed units 
to be reserved for low- and moderate-income 
renters or homebuyers;
(vii) streamlining regulatory requirements 
and shortening processes, reforming zoning 
codes, or other initiatives that reduce 
barriers to housing supply elasticity and 
affordability;
(viii) allowing accessory dwelling units;
(ix) using local tax incentives to promote 
development of affordable housing; and
(x) implementing measures that protect 
tenants from harassment and displacement, 
including--
(I) providing access to counsel for 
tenants facing eviction;
(II) the prohibition of eviction 
except for just cause;
(III) measures intended to prevent 
or mitigate sudden increases in rents;
(IV) the repeal of laws that 
prevent localities from implementing a 
measure described in subclause (I), 
(II), or (III);
(V) protections against 
constructive eviction;
(VI) tenant right-to-organize laws;
(VII) a cause of action for tenants 
to sue landlords who threaten or begin 
an illegal eviction; and
(VIII) landlord-tenant mediation or 
other non-eviction diversion programs; 
and
(B) do not include activities that alter ordinances 
that govern wage and hour laws, family and medical 
leave laws, health and safety requirements, prevailing 
wage laws, or protections for workers' health and 
safety, anti-discrimination, and right to organize.
(3) Relation to consolidated plan.--An eligible entity 
shall include in an application submitted under paragraph (1) a 
description of how the planning and development of eligible 
activities described in subsection (c) may advance an 
objective, or an aspect of an objective, included in the 
comprehensive housing affordability strategy and community 
development plan of the eligible entity under part 91 of title 
24, Code of Federal Regulations, or any successor regulation 
(commonly referred to as a ``consolidated plan'').
(e) Labor Laws.--
(1) In general.--All laborers and mechanics employed by 
contractors or subcontractors in the performance of 
construction work financed in whole or in part with a grant 
received under this section shall be paid wages at rates not 
less than those prevailing on similar construction in the 
locality, as determined by the Secretary of Labor in accordance 
with subchapter IV of chapter 31 of title 40, United States 
Code (commonly known as the ``Davis-Bacon Act'').
(2) Authority and functions.--With respect to the labor 
standards specified in paragraph (1), the Secretary of Labor 
shall have the authority and functions set forth in 
Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 
U.S.C. App.) and section 3145 of title 40, United States Code.
(f) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $2,000,000,000 for each of 
fiscal years 2025 through 2029.

SEC. 102. INVESTING IN AFFORDABLE HOUSING INFRASTRUCTURE.

(a) Housing Trust Fund.--Section 1338(a) of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4568(a)) is amended by adding at the end the following:
``(3) Authorization of appropriations.--There is authorized 
to be appropriated to the Housing Trust Fund $48,000,000,000 
for each of fiscal years 2025 through 2034.''.
(b) Capital Magnet Fund.--Section 1339 of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4569) 
is amended by adding at the end the following:
``(k) Authorization of Appropriations.--There is authorized to be 
appropriated to the Capital Magnet Fund $3,000,000,000 for each of 
fiscal years 2025 through 2034.''.
(c) Public Housing Capital Fund.--Section 9(c)(2)(A) of the United 
States Housing Act of 1937 (42 U.S.C. 1437g(c)(2)(A)) is amended to 
read as follows:
``(A) Capital fund.--For allocations of assistance 
from the Capital Fund, $70,000,000,000 for fiscal year 
2025.''.
(d) Indian Housing Block Grant Program.--Section 108 of the Native 
American Housing Assistance and Self-Determination Act of 1996 (25 
U.S.C. 4117) is amended--
(1) by striking ``such sums as may be necessary for each of 
fiscal years 2009 through 2013'' and inserting ``$2,500,000,000 
for fiscal year 2025 and such sums as may be necessary for each 
of fiscal years 2026 through 2034''; and
(2) by striking the second sentence.
(e) Native Hawaiian Housing Block Grant Program.--Section 824 of 
the Native American Housing Assistance and Self-Determination Act of 
1996 (25 U.S.C. 4243) is amended by striking ``such sums as may be 
necessary for each of fiscal years 2001, 2002, 2003, 2004, and 2005'' 
and inserting ``$50,000,000 for fiscal year 2025 and such sums as may 
be necessary for each of fiscal years 2026 through 2034''.
(f) Rural Housing Programs.--Out of funds in the Treasury not 
otherwise appropriated, there is appropriated for fiscal year 2025--
(1) to provide direct loans under section 502 of the 
Housing Act of 1949 (42 U.S.C. 1472), $420,000,000;
(2) to provide assistance under section 514 of such Act (42 
U.S.C. 1484), $54,000,000;
(3) to provide assistance under section 515 of such Act (42 
U.S.C. 1485), $420,000,000;
(4) to provide assistance under section 516 of such Act (42 
U.S.C. 1486), $75,000,000;
(5) to provide grants under section 523 of such Act (42 
U.S.C. 1490c), $75,000,000; and
(6) to provide funding to carry out the Multifamily 
Preservation and Revitalization Demonstration Program of the 
Rural Housing Service (as authorized under sections 514, 515, 
and 516 of such Act (42 U.S.C. 1484, 1485, 1486)), 
$240,000,000.
(g) Middle Class Housing Emergency Fund.--
(1) Definitions.--In this subsection--
(A) the term ``affordable rental housing unit'' 
means a unit for which monthly rent is not more than 30 
percent of the monthly area median income; and
(B) the term ``State'' has the meaning given the 
term in section 3(b)(7) of the United States Housing 
Act of 1937 (42 U.S.C. 1437a(b)(7)).
(2) Establishment.--The Secretary of Housing and Urban 
Development shall establish and manage a fund, to be known as 
the ``Middle Class Housing Emergency Fund'', which shall be 
funded with any amounts as may be appropriated, transferred, or 
credited to the Fund under any provision law.
(3) Grants.--From amounts available in the fund established 
under paragraph (2), the Secretary of Housing and Urban 
Development shall award grants on a competitive basis to State 
housing finance agencies located in a State in which--
(A) there is a shortage of affordable rental 
housing units available to individuals with an income 
that is at or below the area median income and median 
rents have risen on average over the preceding 5 years 
substantially faster than the area median income; or
(B) there is a shortage of housing units available 
for sale that are affordable to individuals with an 
income that is at or below the area median income and 
median home prices have risen on average over the 
preceding 5 years substantially faster than the area 
median income.
(4) Use of funds.--Grants received under this subsection 
shall be used to fund--
(A) the construction or acquisition, by nonprofit 
organizations, State or local agencies, special-purpose 
units of local government, resident councils organized 
to acquire housing, and other qualified purchasers (as 
defined by the Secretary of Housing and Urban 
Development), of rental housing units or units for 
purchase that are affordable to residents making less 
than 120 percent of the area median income; and
(B) measures to prevent tenant displacement and 
harassment, including--
(i) the provision of legal advice and 
representation for tenants facing eviction;
(ii) enforcement of anti-harassment laws;
(iii) emergency rental assistance; and
(iv) other measures as specified by the 
Secretary of Housing and Urban Development.
(5) Labor laws.--
(A) In general.--All laborers and mechanics 
employed by contractors or subcontractors in the 
performance of construction work financed in whole or 
in part with a grant received under this subsection 
shall be paid wages at rates not less than those 
prevailing on similar construction in the locality as 
determined by the Secretary of Labor in accordance with 
subchapter IV of chapter 31 of title 40, United States 
Code (commonly known as the ``Davis-Bacon Act'').
(B) Authority and functions.--With respect to the 
labor standards specified in subparagraph (A), the 
Secretary of Labor shall have the authority and 
functions set forth in Reorganization Plan Numbered 14 
of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 
of title 40, United States Code.
(6) Regulations.--The Secretary of Housing and Urban 
Development shall promulgate regulations to carry out this 
subsection that include--
(A) the metrics that the Secretary will use to 
determine eligibility for a grant under this 
subsection;
(B) a requirement that grantees and subgrantees 
consult with impacted communities in policymaking and 
planning for the construction or acquisition of housing 
units as described in paragraph (4)(A); and
(C) a requirement that all housing units 
constructed or acquired using grants awarded under the 
subsection are affordable to residents making less than 
120 percent of the area median income in perpetuity.
(7) Appropriations.--Out of funds in the Treasury not 
otherwise appropriated, there is appropriated to the fund 
established under this subsection $4,000,000,000 for fiscal 
year 2025.

SEC. 103. CONDITIONS FOR THE SALE OF REAL ESTATE-OWNED PROPERTIES AND 
NON-PERFORMING LOANS.

(a) Findings.--Congress finds that--
(1) the Federal Housing Administration, the Federal 
National Mortgage Association, and the Federal Home Loan 
Mortgage Corporation provide critical homeownership 
opportunities that greatly benefit individuals, families, and 
communities; and
(2) it is the purpose of this section to--
(A) preserve owner-occupied homes with mortgages 
insured by the Federal Housing Administration or 
purchased by the Federal National Mortgage Association 
or the Federal Home Loan Mortgage Corporation for 
continued use as owner-occupied homes; and
(B) direct that, upon the sale of those properties 
or transfer of those mortgages, certain percentages of 
those properties are sold to low- and moderate-income 
homeowners.
(b) Loans Insured by the Federal Housing Administration.--Title II 
of the National Housing Act (12 U.S.C. 1707 et seq.) is amended by 
adding at the end the following:

``SEC. 259. SALE OF REAL ESTATE-OWNED PROPERTIES.

``(a) Definitions.--In this section--
``(1) the term `Claim Without Conveyance of Title program' 
means the program of the Federal Housing Administration carried 
out under section 203.368 of title 24, Code of Federal 
Regulations, or any successor regulation; and
``(2) the term `community partner' has the meaning given 
the term `nonprofit organization' in section 229 of the Low-
Income Housing Preservation and Resident Homeownership Act of 
1990 (12 U.S.C. 4119).
``(b) Requirement.--Not later than 1 year after the date of 
enactment of this section, the Secretary shall develop programs within 
the Federal Housing Administration to ensure that not less than 75 
percent of the single-family residential properties conveyed to the 
Federal Housing Administration after foreclosure or conveyed to third 
parties under the Claim Without Conveyance of Title program are sold--
``(1) directly to an owner-occupant; or
``(2) to community partners that will--
``(A) rehabilitate or develop the property; and
``(B) sell the property to an owner-occupant.
``(c) Guidelines.--Not later than 1 year after the date of 
enactment of this section, the Secretary shall develop guidelines for 
the Claim Without Conveyance of Title program that provide an exclusive 
listing period during which only eligible governmental entities, 
nonprofit organizations approved by the Department of Housing and Urban 
Development, and owner-occupant buyers may submit bids.
``(d) Anti-Predatory Feature.--Unless the Secretary provides prior 
approval, the Secretary shall prohibit any purchaser of a real estate-
owned property of the Federal Housing Administration from reselling the 
property within 15 years of purchase using a land installment contract 
or through any other mechanism that does not transfer title to the 
buyer at the time of sale.

``SEC. 260. SALE OF NON-PERFORMING LOANS.

``(a) Definitions.--In this section--
``(1) the term `community partner' has the meaning given 
the term in section 259; and
``(2) the term `covered mortgage'--
``(A) means any mortgage insured under this title 
that is secured by a single-family residential 
property; and
``(B) includes the promissory note secured by the 
mortgage described in subparagraph (A).
``(b) Restriction on Sale or Transfer.--Except as provided in this 
section, the Secretary may not sell or transfer any covered mortgage.
``(c) Conditions for Sale or Transfer.--
``(1) In general.--The Secretary--
``(A) may sell or transfer a covered mortgage only 
if--
``(i) the capital level of the Fund is 
substantially below the capital ratio required 
under section 205(f)(2);
``(ii) the Secretary certifies that other 
reasonable measures are not available to 
restore the Fund to that capital ratio; and
``(iii) the Secretary complies with 
paragraph (2)(C), if applicable; and
``(B) may sell or transfer only such covered 
mortgages as are necessary to assist in restoration of 
that capital ratio.
``(2) Requirements for the secretary.--
``(A) In general.--If the Secretary intends to sell 
or transfer a covered mortgage, the Secretary shall 
provide the current borrower and all owners of record 
of the property securing the covered mortgage, or 
require that the current borrower and owners of record 
be provided, a separate written notice of the intent to 
sell the covered mortgage that--
``(i) is mailed via certified and first 
class mail not less than 90 days before the 
date on which the loan is included in any 
proposed sale; and
``(ii) includes--
``(I) a description of the loss 
mitigation options of the Federal 
Housing Administration that are 
available to borrowers in financial 
distress and the obligation of 
servicers to consider borrowers in 
default for those options;
``(II) a description of the actions 
that the servicer of the loan has taken 
to review and implement those options 
for the borrower; and
``(III) a description of the 
procedures the borrower may use to 
contest with the Secretary the 
compliance by the servicer with that 
obligation.
``(B) Judicial review.--The determination of the 
Secretary to authorize the sale of a mortgage insured 
under this title shall be reviewable under chapter 7 of 
title 5, United States Code, for abuse of discretion 
and arbitrary and capricious agency action.
``(C) Auctions.--The Secretary may not sell any 
covered mortgage through any type of non-performing 
loan sale auction program until the Secretary issues 
rules, through the notice and comment rule making 
procedures under section 553 of title 5, United States 
Code, that address essential aspects of any non-
performing loan sale program, including--
``(i) the method of selection of loans for 
sale;
``(ii) notice to borrowers prior to 
inclusion of the loan in a sale; and
``(iii) review of loss mitigation status 
prior to the sale, selection of eligible 
bidders, loss mitigation guidelines applicable 
to loan purchasers, and reporting requirements 
for purchasers.
``(3) Certification requirement for lenders and 
servicers.--
``(A) Certification.--As a condition to payment of 
an insurance claim under this title in connection with 
any non-performing loan sale, the lender or servicer of 
the loan shall provide the Secretary and the borrower 
with written certification of the loss mitigation 
review contained in the FHA Single Family Housing 
Policy Handbook 4000.1, or any successor handbook, 
which certification shall include a description of the 
actions the lender or servicer has taken, prior to 
transfer of the loan to the Secretary, to--
``(i) review the borrower for all available 
loss mitigation options of the Federal Housing 
Administration; and
``(ii) implement the options described in 
clause (i) that are appropriate to the 
borrower.
``(B) False statements.--
``(i) In general.--Any false statement 
provided in a certification described in 
subparagraph (A) shall be a basis for--
``(I) recovery by the Secretary of 
any amounts paid under the insurance 
claim and any other penalties and 
sanctions authorized under Federal law; 
and
``(II) a private right of action by 
the borrower against the lender and 
servicer, with remedies to include 
compensatory and punitive damages and 
an assessment of costs and attorney's 
fees.
``(ii) Transfers.--Unless a bona fide 
purchaser has acquired title to the property as 
a primary residence--
``(I) a certification described in 
subparagraph (A) that contains a false 
statement shall be a basis for revoking 
the transfer of the property; and
``(II) the pre-sale lender and 
servicer of the property shall--
``(aa) resume servicing the 
loan as a loan insured under 
this title; and
``(bb) reimburse the 
Secretary for any insurance 
claim paid and all costs 
related to the sale of the 
property.
``(4) Requirements for purchasers.--
``(A) In general.--Each purchaser of a covered 
mortgage shall offer the borrower on the covered 
mortgage loss mitigation options that allow for payment 
reduction at least as great as would be available to 
the borrower if the loan had not been sold.
``(B) Loss mitigation options.--The specific 
formula, calculations, waterfall steps, and other terms 
for appropriate loss mitigation options described in 
subparagraph (A) shall be published by the Secretary, 
made available to the public, and included in a written 
notice given to borrowers before any acceleration or 
foreclosure is initiated after a loan sale.
``(5) Requirements for transferees.--With respect to a 
transferee, including any subsequent transferee, of a covered 
mortgage that is sold under this title--
``(A) the transferee shall certify in writing to 
the Secretary that the transferee will comply with the 
provisions of this section in the marketing and 
transfer of any property received in the disposition of 
any transferred loan;
``(B) the transferee shall provide to the Secretary 
records documenting that the transfers of those 
properties are in compliance with this section; and
``(C) the failure of the Secretary or the 
transferee to comply with the requirements under this 
section for a loan in default shall be a defense to 
foreclosure, and a transferee may not execute a 
foreclosure judgment or order of sale, or conduct a 
foreclosure sale, until the transferee has complied 
with all requirements under this section.
``(d) Limitations.--With respect to covered mortgages that are sold 
under this title and acquired by the buyer through foreclosure sale, 
not less than 90 percent of the properties that are the subject of the 
covered mortgages shall be--
``(1) sold to owner-occupants;
``(2) operated or transferred to an entity that will 
operate the property as affordable rental housing for 
households below 80 percent of the area median income for a 
period of not less than 15 years; or
``(3) transferred or donated to a nonprofit agency that is 
certified by the Secretary and will redevelop the property for 
owner occupancy or affordable rental housing.
``(e) Prioritization of Sales.--The Secretary shall implement 
policies, procedures, and controls to--
``(1) identify and recruit community partners;
``(2) engage in consultations with community partners 
before the sale of a pool of covered mortgages under this title 
to determine whether that sale can be designed to meet the 
specific needs of the communities served by the community 
partners; and
``(3) prioritize the sale of pools of single-family 
mortgages to community partners by--
``(A) designing pools of covered mortgages for 
direct sale to a community partner, the price of which 
shall be set by the Secretary based on a pricing model 
that considers--
``(i) the current fair market value of the 
properties; and
``(ii) the potential impact of foreclosures 
on those properties to the value of other homes 
that secure mortgages insured under this title 
in the same census tract; or
``(B) in the case of an auction, if the winning bid 
is not from a community partner, permitting any 
community partner that bid during that same auction to 
have a final opportunity to enter a higher bid on the 
pool.''.
(c) Fannie Mae.--Section 302 of the Federal National Mortgage 
Association Charter Act (12 U.S.C. 1717) is amended by adding at the 
end the following:
``(d)(1) In this subsection, the term `covered mortgage'--
``(A) means any mortgage that is secured by a single-family 
residential property; and
``(B) includes the promissory note secured by the mortgage 
described in subparagraph (A).
``(2) The corporation may not sell or transfer any covered mortgage 
under this section unless the requirements of this subsection are met.
``(3)(A) If the corporation intends to sell or transfer a covered 
mortgage, the corporation shall provide the current borrower and all 
owners of record of the property securing the covered mortgage, or 
require that the current borrower and owners of record be provided, a 
separate written notice of the intent to sell the covered mortgage 
that--
``(i) is mailed via certified and first class mail not less 
than 90 days before the date on which the loan is included in 
any proposed sale; and
``(ii) includes--
``(I) a description of the loss mitigation options 
of the corporation that are available to borrowers in 
financial distress and the obligation of servicers to 
consider borrowers in default for those options;
``(II) a description of the actions that the 
servicer of the loan has taken to review and implement 
those options for the borrower; and
``(III) a description of the procedures the 
borrower may use to contest with the corporation the 
compliance by the servicer with that obligation.
``(B) The Federal Housing Finance Agency, as receiver for the 
corporation, may not authorize the corporation to sell any covered 
mortgage through any type of non-performing loan sale auction program 
until the Director of the Federal Housing Finance Agency issues rules, 
through the notice and comment rule making procedures under section 553 
of title 5, United States Code, that address essential aspects of any 
non-performing loan sale program, including--
``(i) the method of selection of loans for sale;
``(ii) notice to borrowers prior to inclusion of the loan 
in a sale; and
``(iii) review of loss mitigation status prior to the sale, 
selection of eligible bidders, loss mitigation guidelines 
applicable to loan purchasers, and reporting requirements for 
purchasers.
``(4)(A) Each purchaser of a covered mortgage shall offer the 
borrower on the covered mortgage loss mitigation options that allow for 
payment reduction at least as great as would be available to the 
borrower if the loan had not been sold.
``(B) The specific formula, calculations, waterfall steps, and 
other terms for loss mitigation options described in subparagraph (A) 
shall be published by the corporation, made available to the public, 
and included in a written notice given to borrowers before any 
acceleration or foreclosure is initiated after a loan sale.
``(5) With respect to a transferee, including any subsequent 
transferee, of a covered mortgage that is sold by the corporation under 
this section--
``(A) the transferee shall certify in writing to the 
corporation that the transferee will comply with the provisions 
of this subsection in the marketing and transfer of any 
property received in the disposition of any transferred loan;
``(B) the transferee shall provide to the corporation 
records documenting that the transfers of those properties are 
in compliance with this subsection; and
``(C) the failure of the corporation or the transferee to 
comply with the requirements under this subsection for a loan 
in default shall be a defense to foreclosure, and a transferee 
may not execute a foreclosure judgment or order of sale, or 
conduct a foreclosure sale, until the transferee has complied 
with all requirements under this subsection.
``(6) With respect to covered mortgages that are sold by the 
corporation under this section and foreclosed upon by the buyer, not 
less than 90 percent of the properties that are the subject of the 
covered mortgages in an auction shall be--
``(A) sold to owner-occupants;
``(B) operated or transferred to an entity that will 
operate the property as affordable rental housing for 
households below 80 percent of the area median income for a 
period of not less than 15 years; or
``(C) transferred or donated to a nonprofit agency that is 
certified by the corporation and will redevelop the property 
for owner occupancy or affordable rental housing.
``(7) The corporation shall implement policies, procedures, and 
controls to--
``(A) identify and recruit community partners;
``(B) engage in consultations with community partners 
before the sale of a pool of covered mortgages under this 
section to determine whether that sale can be designed to meet 
the specific needs of the communities served by the community 
partners; and
``(C) prioritize the sale of pools of single-family 
mortgages to community partners by--
``(i) designing pools of covered mortgages for 
direct sale to a community partner, the price of which 
shall be set by the corporation based on a pricing 
model that considers--
``(I) the current fair market value of the 
properties; and
``(II) the potential impact of foreclosures 
on those properties to the value of other homes 
in the same census tract; or
``(ii) in the case of an auction, if the winning 
bid is not from a community partner, permitting any 
community partner that bid during that same auction to 
have a final opportunity to enter a higher bid on the 
pool.''.
(d) Freddie Mac.--Section 305 of the Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1454) is amended by adding at the end the 
following:
``(e)(1) In this subsection, the term `covered mortgage'--
``(A) means any mortgage that is secured by a single-family 
residential property; and
``(B) includes the promissory note secured by the mortgage 
described in subparagraph (A).
``(2) The Corporation may not sell or transfer any covered mortgage 
under this section unless the requirements of this subsection are met.
``(3)(A) If the Corporation intends to sell or transfer a covered 
mortgage, the Corporation shall provide the current borrower and all 
owners of record of the property securing the covered mortgage, or 
require that the current borrower and owners of record be provided, a 
separate written notice of the intent to sell the covered mortgage 
that--
``(i) is mailed via certified and first class mail not less 
than 90 days before the date on which the loan is included in 
any proposed sale; and
``(ii) includes--
``(I) a description of the loss mitigation options 
of the Corporation that are available to borrowers in 
financial distress and the obligation of servicers to 
consider borrowers in default for those options;
``(II) a description of the actions that the 
servicer of the loan has taken to review and implement 
those options for the borrower; and
``(III) a description of the procedures the 
borrower may use to contest with the Corporation the 
compliance by the servicer with that obligation.
``(B) The Federal Housing Finance Agency, as receiver for the 
Corporation, may not sell any covered mortgage through any type of non-
performing loan sale auction program until the Director of the Federal 
Housing Finance Agency issues rules, through the notice and comment 
rule making procedures under section 553 of title 5, United States 
Code, that address essential aspects of any non-performing loan sale 
program, including--
``(i) the method of selection of loans for sale;
``(ii) notice to borrowers prior to inclusion of the loan 
in a sale; and
``(iii) review of loss mitigation status prior to the sale, 
selection of eligible bidders, loss mitigation guidelines 
applicable to loan purchasers, and reporting requirements for 
purchasers.
``(4)(A) Each purchaser of a covered mortgage shall offer the 
borrower on the covered mortgage loss mitigation options that allow for 
payment reduction at least as great as would be available to the 
borrower if the loan had not been sold.
``(B) The specific formula, calculations, waterfall steps, and 
other terms for loss mitigation options described in subparagraph (A) 
shall be published by the Corporation, made available to the public, 
and included in a written notice given to borrowers before any 
acceleration or foreclosure is initiated after a loan sale.
``(5) With respect to a transferee, including any subsequent 
transferee, of a covered mortgage that is sold by the Corporation under 
this section--
``(A) the transferee shall certify in writing to the 
Corporation that the transferee will comply with the provisions 
of this subsection in the marketing and transfer of any 
property received in the disposition of any transferred loan;
``(B) the transferee shall provide to the Corporation 
records documenting that the transfers of those properties are 
in compliance with this subsection; and
``(C) the failure of the Corporation or the transferee to 
comply with the requirements under this subsection for a loan 
in default shall be a defense to foreclosure, and a transferee 
may not execute a foreclosure judgment or order of sale, or 
conduct a foreclosure sale, until the transferee has complied 
with all requirements under this subsection.
``(6) With respect to covered mortgages that are sold by the 
Corporation under this section and foreclosed upon by the buyer, not 
less than 90 percent of the properties that are the subject of the 
covered mortgages in an auction shall be--
``(A) sold to owner-occupants;
``(B) operated or transferred to an entity that will 
operate the property as affordable rental housing for 
households below 80 percent of the area median income for a 
period of not less than 15 years; or
``(C) transferred or donated to a nonprofit agency that is 
certified by the Corporation and will redevelop the property 
for owner occupancy or affordable rental housing.
``(7) The Corporation shall implement policies, procedures, and 
controls to--
``(A) identify and recruit community partners;
``(B) engage in consultations with community partners 
before the sale of a pool of covered mortgages under this 
section to determine whether that sale can be designed to meet 
the specific needs of the communities served by the community 
partners; and
``(C) prioritize the sale of pools of single-family 
mortgages to community partners by--
``(i) designing pools of covered mortgages for 
direct sale to a community partner, the price of which 
shall be set by the Corporation based on a pricing 
model that considers--
``(I) the current fair market value of the 
properties; and
``(II) the potential impact of foreclosures 
on those properties to the value of other homes 
in the same census tract; or
``(ii) in the case of an auction, if the winning 
bid is not from a community partner, permitting any 
community partner that bid during that same auction to 
have a final opportunity to enter a higher bid on the 
pool.''.
(e) Sale of Re-Performing Loans.--The Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is 
amended by inserting after section 1328 (12 U.S.C. 4548) the following:

``SEC. 1329. SALE OF RE-PERFORMING LOANS.

``(a) Bulk Auction or Group Sales.--An enterprise may not conduct 
bulk auctions or other group sales of single family re-performing 
residential loans unless the following requirements are met:
``(1) The enterprise establishes a system that provides 
priority to Federal, State, local, or Tribal governments or 
nonprofit organizations that have the capacity and experience 
required for buying, servicing, and resolving single family 
mortgage loans in a manner that promotes affordable housing, 
fair housing, affordable homeownership, provision of housing 
counseling, or neighborhood stabilization.
``(2) Clear, written notice is sent by the enterprise or 
servicer through certified and first-class mail to the borrower 
and all owners of record, with a copy sent to the enterprise if 
sent by the servicer, not less than 90 days before the 
inclusion of the loan in any proposed sale--
``(A) stating that the loan will be included in a 
bulk auction or group sale of re-performing loans; and
``(B) describing the bulk auction or group sale 
process, including--
``(i) the loss mitigation or other 
protections available to the borrower and other 
owners of record both before and after the 
auction or sale; and
``(ii) the obligations of the servicer of 
the loan before and after the auction or sale, 
including loss mitigation requirements.
``(3) The enterprise requires in the terms of the bulk 
auction or group sale that purchasers take loans subject to the 
following requirements:
``(A) The purchaser is required to offer targeted 
payment relief options to borrowers that become more 
than 60 days delinquent on their mortgage after their 
loan is sold that includes deferral of principal and 
term extension options that reduce payments to an 
affordable level.
``(B) The purchaser is required to offer a deferral 
program to borrowers that become more than 60 days 
delinquent on their mortgage after their loan is sold 
that offers terms and protections at least as favorable 
as those available under loss mitigation guidelines of 
the enterprise, including the absence of fees, to 
borrowers who can afford their pre-hardship mortgage 
payment.
``(C) Failure by the purchaser to follow the 
established loss mitigation guidelines shall serve as a 
defense to a judicial foreclosure and a basis to enjoin 
or otherwise stay a non-judicial foreclosure.
``(D) Data reporting as provided under subsection 
(b)(1).
``(E) If a property becomes vacant, the purchaser 
shall not release the lien until the property is sold 
or donated.
``(F) Use of contract for deed, lease to own, or a 
land installment contract to sell or otherwise transfer 
any property that is secured by a purchased loan shall 
be prohibited unless the tenant or purchaser is a 
nonprofit organization.
``(b) Data and Reporting.--
``(1) Purchaser reporting.--During the 4-year period 
following any auction or sale of single family re-performing 
residential mortgage loans under subsection (a), the Director 
shall require the enterprise to collect from each purchaser of 
such loans, including any subsequent purchaser of a loan, 
quarterly loan-level data regarding the treatment and outcome 
of the loan, including--
``(A) loan characteristics, including loan type, 
remaining loan term, loan to value ratio, number of 
months in arrears, and loan status;
``(B) loss mitigation data, including whether loss 
mitigation was provided by the purchaser, debt-to-
income ratio and percent payment reduction for any 
modified loans, and performance of modified loans;
``(C) demographic data for each borrower and any 
co-borrower, including race, national origin, sex, ZIP 
Code, and census tract, and, if available, disability 
status and veteran status; and
``(D) other purchaser actions, including charge 
offs and resales of loans and dates for such actions.
``(2) Semiannual reports to congress.--The Director shall 
submit to Congress, and make publicly available at no cost to 
the public in a readily accessible format on the website of the 
Agency, semi-annual reports on--
``(A) loans sold in an auction or sale under 
subsection (a) by each enterprise, disaggregated by 
pool, including--
``(i) the number of loans and types of 
loans;
``(ii) mean and median delinquency and loan 
to value ratios at the time of the sale;
``(iii) the number and percentage of loans 
modified prior to auction or sale; and
``(iv) demographic and geographic data, 
including property locations by census tract or 
larger geographic location if necessary to 
protect personally identifiable information;
``(B) the performance of loans after an auction or 
sale under subsection (a), disaggregated by loan pool, 
including the initial purchaser, current owner, current 
servicer, data summarizing any alternatives to 
foreclosure offered and enacted, and data summarizing 
the data collected under subparagraph (A); and
``(C) the results of a fair lending analysis 
conducted based on the data in subparagraphs (A) and 
(B) to identify any discriminatory impacts or outcomes 
associated with the auctions or sales.
``(c) Penalties for Noncompliance.--The enterprises may forcibly 
retain loans or properties, without providing compensation, from 
purchasers that do not meet the requirements under subsection (a)(3).
``(d) Regulations.--The Director shall issue regulations defining 
the terms of permissible auctions or sales in accordance with the 
requirements in this section.''.

TITLE II--TAKING THE FIRST STEPS TO REVERSE THE LEGACY OF HOUSING 
DISCRIMINATION AND GOVERNMENT NEGLIGENCE

SEC. 201. DOWN PAYMENT ASSISTANCE PROGRAM FOR FIRST-TIME, FIRST-
GENERATION HOMEBUYERS.

(a) Definitions.--In this section:
(1) Eligible resident.--The term ``eligible resident'' 
means an individual who--
(A) is a first-time homebuyer;
(B) is a first-generation homebuyer; and
(C) has an income that is less than--
(i) 120 percent of the area median income; 
or
(ii) in the case of a homebuyer acquiring a 
property for use as a principal residence that 
is located in a high-cost area, as determined 
by the Secretary, 140 percent of the area 
median income.
(2) First-generation homebuyer.--The term ``first-
generation homebuyer'' means a homebuyer who is, as self-
attested by the homebuyer, an individual--
(A) whose parents do not, or did not at the time of 
their death, to the best of the individual's knowledge, 
have any present ownership interest in a principal 
residence in any State, excluding ownership of heir 
property; and
(B) whose spouse or domestic partner has not, 
during the 3-year period ending on the date of purchase 
of a property using a grant under subsection (b), had 
any present ownership interest in a principal residence 
in any State, excluding ownership of heir property, 
without regard to whether the spouse or domestic 
partner is a co-borrower on a mortgage for the property 
being purchased.
(3) First-time homebuyer.--The term ``first-time 
homebuyer'' means a homebuyer who is, as self-attested by the 
homebuyer, an individual (and if married or in a domestic 
partnership, the spouse or domestic partner of the individual) 
who, during the 3-year period ending on the date of purchase of 
a property using a grant under subsection (b)--
(A) has had no present ownership in a principal 
residence in any State, excluding ownership of heir 
property; or
(B) surrendered any present ownership interest in a 
principal residence in any State, excluding ownership 
of heir property, as part of a divorce proceeding.
(4) Heir property.--The term ``heir property'' means 
residential property for which title--
(A) passed by operation of law through intestacy; 
and
(B) is held by 2 or more heirs as tenants in 
common.
(5) Secretary.--The term ``Secretary'' means the Secretary 
of Housing and Urban Development.
(6) State.--The term ``State'' includes the District of 
Columbia and any territory or possession of the United States.
(b) Establishment.--There is established in the Treasury of the 
United States a fund that--
(1) shall be administered by the Secretary, acting through 
the Office of Housing of the Department of Housing and Urban 
Development; and
(2) shall be used--
(A) to provide grants to eligible residents to 
purchase a property for use as a principal residence;
(B) for outreach to financial institutions in 
targeted areas and eligible residents, including for 
the administration of that outreach;
(C) for counseling or financial education 
administered by counseling agencies approved by the 
Secretary in order to ensure sustainable homeownership; 
and
(D) to maintain any records required to implement 
this section.
(c) Grant Amount.--An eligible resident may receive a grant under 
subsection (b) in an amount equal to--
(1) not more than 3.5 percent of the appraised value of the 
property to be purchased; or
(2) if the appraised value of the property to be purchased 
exceeds the principal obligation amount limitation for 
mortgages insured under title II of the National Housing Act 
(12 U.S.C. 1707 et seq.), 3.5 percent of the maximum principal 
obligation limitation for the property to be purchased.
(d) Relation to FHA Loan.--An eligible resident shall not be 
required to obtain a mortgage that is insured under title II of the 
National Housing Act (12 U.S.C. 1707 et seq.) as a condition of 
receiving a grant under subsection (b).
(e) Layering of Assistance.--Receipt by an eligible recipient of 
assistance for a down payment from a source other than the fund 
established under subsection (b), including assistance from the Federal 
Government, a State or local government, or any other public, private, 
or nonprofit source, shall not affect the eligibility of the eligible 
recipient for assistance under subsection (b).
(f) Regulations and Database.--Not later than 1 year after the date 
of enactment of this Act, the Secretary shall--
(1) in consultation with interested parties, including 
housing counseling agencies approved by the Secretary and 
individuals or groups with expertise in fair housing, 
promulgate regulations relating to the use of the fund 
established under subsection (b);
(2) promulgate regulations relating to the disbursement of 
funds under this section to ensure that an eligible resident is 
able to receive funds before the closing date for the home of 
the eligible resident, which may include creating a program 
that allows a lender to be reimbursed by the fund established 
under subsection (b) if the lender--
(A) provides an eligible resident with funds for 
the closing; or
(B) allows an eligible resident to be preapproved 
to receive assistance under this section when arranging 
financing for the home of the eligible resident; and
(3) establish methods to verify that an individual is an 
eligible resident.
(g) Appropriation.--Out of funds in the Treasury not otherwise 
appropriated, there is appropriated to the fund established under 
subsection (b) such sums as may be necessary for each of fiscal years 
2025 through 2034 to carry out the activities under subsection (b)(2).
(h) Inclusion of Program in Home Buying Information Booklets.--
Section 5(b) of the Real Estate Settlement Procedures Act of 1974 (12 
U.S.C. 2604(b)) is amended by inserting after paragraph (14) the 
following:
``(15) Information relating to the down payment assistance 
program established under section 201 of the American Housing 
and Economic Mobility Act of 2025.''.
(i) Inclusion of Program as Mortgage Product.--Section 203(f)(1) of 
the National Housing Act (12 U.S.C. 1709(f)(1)) is amended by inserting 
``, including the down payment assistance program established under 
section 201 of the American Housing and Economic Mobility Act of 
2025,'' after ``mortgage products''.
(j) Reliance on Borrower Attestations.--No additional documentation 
beyond the borrower's attestation shall be required to demonstrate 
eligibility under paragraphs (2) and (3) of subsection (a), and no 
creditor shall be subject to liability, including monetary penalties or 
requirements to indemnify a Federal agency or repurchase a loan that 
has been sold or securitized, for the provision of down payment 
assistance under this section to a borrower who does not meet the 
eligibility requirements under those paragraphs if the creditor does so 
in good faith reliance on borrower attestations of eligibility required 
by those paragraphs or any regulation promulgated to carry out those 
paragraphs.
(k) Repayment of Assistance.--
(1) Requirement.--An eligible resident who receives a grant 
under subsection (b) to purchase a property for use as a 
principal residence and does not occupy the property as a 
principal residence for 5 years or more shall repay to the 
Secretary a proportional amount of the grant based on the 
number of years, if any, for which the eligible resident has 
occupied the property as a principal residence.
(2) Limitation.--Notwithstanding paragraph (1), an eligible 
resident who receives a grant under subsection (b) to purchase 
a property for use as a principal residence and does not occupy 
the property as a principal residence for 5 years or more shall 
not be liable to the Secretary for repayment under paragraph 
(1) of this subsection if--
(A) the failure to occupy the property as a 
principal residence is due at least in part to a 
hardship; or
(B) the eligible resident sells the property before 
the expiration of the 5-year period beginning on the 
date of acquisition and the capital gains from the sale 
to a bona fide purchaser in an arm's length transaction 
are less than the amount the eligible resident would be 
required to repay under paragraph (1).

SEC. 202. FORMULA GRANT PROGRAM FOR COMMUNITIES WITH AN APPRAISAL GAP.

(a) Definitions.--In this section--
(1) the term ``neighborhood with an appraisal gap'' means a 
census tract in which the median sales price of a dwelling unit 
is lower than the median cost to acquire and rehabilitate, or 
build, a new dwelling unit;
(2) the term ``Secretary'' means the Secretary of Housing 
and Urban Development; and
(3) the term ``State'' has the meaning given the term in 
section 3(b)(7) of the United States Housing Act of 1937 (42 
U.S.C. 1437a(b)(7)).
(b) Establishment.--The Secretary shall establish a formula grant 
program to provide funding to States to support neighborhoods with an 
appraisal gap, including borrowers with negative equity in their 
primary residence in those neighborhoods, through--
(1) measures that provide funds to borrowers to--
(A) pay down arrears on an otherwise affordable 
loan;
(B) pay down arrears or principal on a loan in 
order to qualify for a loan modification that will 
allow the borrower to keep the home;
(C) pay off, or pay down part of, a second mortgage 
or home equity line of credit;
(D) pay off a small-dollar mortgage;
(E) pay delinquent taxes and tax liens;
(F) pay off delinquent water or sewer bills and 
liens; and
(G) pay for home repairs or maintenance or for 
modifications to bring the home into compliance with 
any applicable codes; and
(2) programs to purchase or rehabilitate vacant or 
distressed properties to enhance neighborhood property values.
(c) Formula.--The Secretary shall distribute amounts under this 
section to States based on--
(1) the number of borrowers with a primary residence with 
negative equity in each State; and
(2) the share of neighborhoods with an appraisal gap in 
each State.
(d) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $5,000,000,000 for fiscal year 
2025.

SEC. 203. STRENGTHENING THE COMMUNITY REINVESTMENT ACT OF 1977.

(a) Short Title.--This section may be cited as the ``Community 
Reinvestment Reform Act of 2025''.
(b) Amendments to the Community Reinvestment Act of 1977.--The 
Community Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is 
amended--
(1) by striking sections 802 and 803 (12 U.S.C. 2901, 2902) 
and inserting the following:

``SEC. 802. FINDINGS AND PURPOSE.

``(a) Findings.--Congress finds that--
``(1) regulated financial institutions are required by law 
to demonstrate that they serve the convenience and needs of the 
communities in which they are chartered or do business, in 
particular low- and moderate-income communities;
``(2) the convenience and needs of communities include the 
need for credit services, deposit services, transaction 
services, other financial services, and community development 
loans and investments; and
``(3) regulated financial institutions have a continuing 
and affirmative obligation to meet the credit or other 
financial needs of all the local communities in which they are 
chartered or do business, including communities in which--
``(A) the institutions make loans and do not accept 
deposits; or
``(B) the institutions accept deposits but do not 
make loans.
``(b) Purpose.--It is the purpose of this title to require each 
appropriate Federal financial supervisory agency to use its authority 
when examining regulated financial institutions to ensure that those 
institutions meet the credit and other financial needs of the local 
communities in which they are chartered or do business consistent with 
the safe and sound operation of those institutions.

``SEC. 803. DEFINITIONS.

``In this title:
``(1) Application for a deposit facility.--The term 
`application for a deposit facility' means an application to 
the appropriate Federal financial supervisory agency otherwise 
required under Federal law or regulations thereunder for--
``(A) a charter for a national bank or Federal 
savings and loan association;
``(B) deposit insurance in connection with a newly 
chartered State bank, savings bank, savings and loan 
association, or similar institution;
``(C) the establishment of a domestic branch or 
other facility with the ability to accept deposits of a 
regulated financial institution;
``(D) the relocation of the home office or a branch 
office of a regulated financial institution;
``(E) the merger or consolidation with, the 
acquisition of the assets of, or the assumption of the 
liabilities of a regulated financial institution 
requiring approval under section 18(c) of the Federal 
Deposit Insurance Act (12 U.S.C. 1828(c)); or
``(F) the acquisition of shares in, or the assets 
of, a regulated financial institution requiring 
approval under section 3 of the Bank Holding Company 
Act of 1956 (12 U.S.C. 1842).
``(2) Appropriate federal banking agency.--The term 
`appropriate Federal banking agency' has the meaning given the 
term in section 3 of the Federal Deposit Insurance Act (12 
U.S.C. 1813).
``(3) Appropriate federal financial supervisory agency.--
The term `appropriate Federal financial supervisory agency' 
means--
``(A) the appropriate Federal banking agency with 
respect to depository institutions and depository 
institution holding companies; and
``(B) the Bureau of Consumer Financial Protection 
with respect to any covered person supervised by the 
Bureau pursuant to section 1024 of the Dodd-Frank Wall 
Street Reform and Consumer Protection Act (12 U.S.C. 
5514).
``(4) Assessment area.--The term `assessment area' means, 
with respect to a regulated financial institution, each 
community, including a State, metropolitan area, or urban or 
rural county, in which the institution--
``(A) maintains deposit-taking branches, automated 
teller machines, or retail offices;
``(B) is represented by an agent; or
``(C) issues a significant number of loans or other 
products relative to the total number of loans or other 
products made by the institution or relative to the 
total number of loans or other products offered by the 
private sector market.
``(5) Climate resiliency and disaster mitigation.--The term 
`climate resiliency and disaster mitigation' means activities 
that--
``(A) assist individuals and communities to prepare 
for, adapt to, and withstand climate-related risks, 
natural disasters, or weather-related disasters;
``(B) benefit or serve residents of low- to 
moderate-income census tracts or climate vulnerable 
communities and do not directly result in forced or 
involuntary relocation of those residents; and
``(C) are done in conjunction with--
``(i) a plan, program or initiative of a 
Federal, State, local or Tribal government; or
``(ii) a mission-driven nonprofit 
organization that is focused on benefiting or 
serving targeted census tracts or climate 
vulnerable communities.
``(6) Climate vulnerable communities.--The term `climate 
vulnerable communities' means communities experiencing 
heightened risk and increased sensitivity to climate change 
with less capacity and fewer resources to cope with, adapt to, 
or recover from climate impacts, as determined by the 
appropriate Federal financial supervisory agencies.
``(7) Community benefits plan.--The term `community 
benefits plan' means a plan that provides measurable goals for 
future amounts of safe and sound loans, investments, services, 
and other financial products for low- and moderate-income 
communities and other distressed or underserved communities.
``(8) Community development.--The term `community 
development' includes--
``(A) affordable housing for low- or moderate-
income individuals and avoidance of patterns of lending 
resulting in the loss of affordable housing units and 
housing for low- and moderate-income individuals in 
high-opportunity areas;
``(B) community development services, including 
counseling and successful mortgage or loan 
modifications of delinquent loans;
``(C) activities that promote integration;
``(D) activities that promote economic development 
by financing small businesses or farms that meet the 
size eligibility requirements of the development 
company or small business investment company programs 
under section 121.301 of title 13, Code of Federal 
Regulations, or any successor regulation, with an 
emphasis on small businesses that have gross annual 
revenues of not more than $1,000,000;
``(E) activities that revitalize or stabilize--
``(i) low- or moderate-income geographies;
``(ii) designated disaster areas;
``(iii) distressed or underserved 
nonmetropolitan middle-income geographies 
designated by the Federal Financial 
Institutions Examination Council, based on--
``(I) rates of poverty, 
unemployment, and population loss; or
``(II) population size, density, 
and dispersion, if those activities 
help to meet essential community needs, 
including the needs of low- and 
moderate-income individuals; or
``(iv) other distressed or underserved 
communities;
``(F) activities that promote physical, 
environmental, and sensory accessibility in housing 
stock that is integrated into the community; and
``(G) other activities that promote the objectives 
of this title, as determined by the appropriate Federal 
financial supervisory agencies.
``(9) Depository institution; depository institution 
holding company; insured depository institution.--The terms 
`depository institution', `depository institution holding 
company', and `insured depository institution' have the 
meanings given those terms in section 3 of the Federal Deposit 
Insurance Act (12 U.S.C. 1813).
``(10) Entire community.--The term `entire community' 
means--
``(A) all of the assessment areas of a regulated 
financial institution; and
``(B) areas outside of assessment areas described 
in subparagraph (A) in which a regulated financial 
institution has made loans or received deposits.
``(11) Enumerated consumer laws.--The term `enumerated 
consumer laws' has the meaning given the term in section 1002 
of the Consumer Financial Protection Act of 2010 (12 U.S.C. 
5481).
``(12) Fossil fuel.--The term `fossil fuel' means coal, 
petroleum, methane gas (often referred to as `natural gas'), or 
any derivative of coal, petroleum, or methane gas that is used 
for fuel directly or indirectly, such as for generating 
electricity.
``(13) Fossil fuel company.--The term `fossil fuel company' 
means any company that--
``(A) is among the 200 companies with the largest 
fossil fuel reserves in the world;
``(B) is among the 30 largest public company owners 
in the world of coal-fired power plants;
``(C) has as its core business--
``(i) the construction or operation of 
fossil fuel infrastructure; or
``(ii) the exploration, extraction, 
refining, processing or distribution of fossil 
fuels; or
``(D) receives more than 50 percent of its gross 
revenue from companies that meet the definition under 
subparagraph (A), (B), or (C).
``(14) Fossil fuel expansion.--The term `fossil fuel 
expansion' means financing for new fossil fuel infrastructure 
projects, including financing of exploration activities, that 
would--
``(A) increase greenhouse gas emissions; and
``(B) increase the difficulty of achieving Federal, 
State, or local carbon emission reduction goals.
``(15) Fossil fuel infrastructure.--The term `fossil fuel 
infrastructure' means oil or gas wells, oil or gas pipelines 
and refineries, oil, coal or gas-fired power plants, oil and 
gas storage tanks, fossil fuel export terminals, and any other 
infrastructure used exclusively for fossil fuels, including 
facilities with carbon capture, utilization, and storage.
``(16) Geography.--The term `geography' means a census 
tract delineated by the Bureau of the Census in the most recent 
decennial census.
``(17) Intermediate bank.--The term `intermediate bank' is 
a depository institution with assets of not less than 
$402,000,000 and less than $1,609,000,000, as adjusted annually 
for purposes of an examination under section 804.
``(18) Large bank.--The term `large bank' is a depository 
institution with assets of not less than $1,609,000,000, as 
adjusted annually for purposes of an examination under section 
804.
``(19) Other distressed or underserved community.--The term 
`other distressed or underserved community' means an area or 
census tract that, according to a periodic review and data 
analysis by the appropriate Federal financial supervisory 
agencies on an interagency basis through the Federal Financial 
Institutions Examination Council of certain metrics, such as 
loans per households or small business, is experiencing 
economic hardship or is underserved by financial institutions.
``(20) Other underserved population.-- The term `other 
underserved population' means a population that is experiencing 
ongoing effects of discrimination or is relatively underserved 
by financial institutions, as measured by loans per households 
or other similar metrics.
``(21) Regulated financial institution.--The term 
`regulated financial institution' means--
``(A) an insured depository institution;
``(B) a depository institution holding company; and
``(C) a U.S. nonbank mortgage originator.
``(22) Retail lending assessment area.--The term `retail 
lending assessment area' means a geographical area in which a 
regulated financial institution--
``(A) makes a threshold number of loans, as 
determined by the appropriated Federal supervisory 
agencies;
``(B) does not have branches, deposit-taking 
automated teller machines, or offices; and
``(C) is not represented by agents.
``(23) Small bank.--The term `small bank' is a depository 
institution with assets of less than $402,000,000, as adjusted 
annually to take into account inflation for purposes of 
determining which institutions are subject to an examination 
under section 804.
``(24) U.S. nonbank mortgage originator.--The term `U.S. 
nonbank mortgage originator' means a covered person subject to 
section 1024 of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (12 U.S.C. 5514) that offers or provides--
``(A) origination of loans secured by real estate 
for use by consumers primarily for personal, family, or 
household purposes; or
``(B) loan modification or foreclosure relief 
services in connection with a loan described in 
subparagraph (A).'';
(2) in section 804 (12 U.S.C. 2903)--
(A) by redesignating subsections (c) and (d) as 
subsections (f) and (g), respectively;
(B) by striking subsections (a) and (b) and 
inserting the following:
``(a) Depository Institutions and Bank Holding Companies.--
``(1) In general.--In connection with its examination of a 
regulated financial institution other than a U.S. nonbank 
mortgage originator, the appropriate Federal financial 
supervisory agency shall perform the following:
``(A) Assess the record of the institution in 
meeting the credit and other financial needs of its 
entire community, in particular low- and moderate-
income people and communities, and other distressed or 
underserved communities, and other underserved 
populations consistent with the safe and sound 
operation of the institution.
``(B) Assess the effectiveness of the following 
activities in meeting the credit and other financial 
needs of the assessment areas of the institution, 
consistent with the safe and sound operation of the 
institution:
``(i) Retail lending, including home, small 
business, consumer, automobile, and other 
lending and financial products, that responds 
to credit needs or other financial needs.
``(ii) Community development lending and 
investments, which may include a consideration 
of--
``(I) the origination of loans and 
other efforts by the institution to 
assist existing low- and moderate-
income residents to remain in 
affordable housing in their community; 
and
``(II) the origination of loans by 
the institution that result in the 
construction, rehabilitation, or 
preservation of affordable housing 
units.
``(iii) Community development finance tests 
or similar tests developed by the appropriate 
Federal banking agencies shall include separate 
quantitative measures for community development 
investments. The evaluation of investments 
shall positively or negatively affect test 
scores depending on bank performance, in 
community development finance tests or similar 
tests.
``(iv) Retail financial services and 
community development services.
``(v) Evaluation of the responsiveness, 
affordability, and sustainability of retail 
financial services including credit and deposit 
products shall positively or negatively affect 
tests scores, depending on bank performance, in 
the retail products and service test or similar 
tests.
``(vi) Retail lending assessment areas 
shall be established for large banks and 
intermediate banks if not more than 90 percent 
of the retail loans of the bank are in 
assessment areas containing their branches and 
deposit-taking automated teller machines. Large 
banks and intermediate bank evaluations shall 
also examine lending outside of retail lending 
assessment areas and assessment areas 
containing branches and deposit-taking 
automated teller machines. Evaluations of these 
loans shall be considered when assigning an 
institution level rating to the bank.
``(C) With respect to its evaluation of an 
application for a deposit facility by the institution--
``(i) consider the record described in 
subparagraph (A), the effectiveness of the 
activities described in subparagraph (B), the 
overall rating of the institution under this 
section, and any improvement plans submitted 
pursuant to this section;
``(ii) provide an opportunity for public 
comment for a period of not less than 60 days;
``(iii) consider changes in the community 
reinvestment performance of the institution 
since the most recent rating under this section 
by the appropriate Federal financial 
supervisory agency; and
``(iv) require--
``(I) a demonstration of public 
benefit, including a community benefits 
plan with measurable goals regarding 
increasing responsible lending and 
other financial products that is 
commensurate with the ability of the 
institution to accomplish those goals;
``(II) that the institution consult 
with community-based organizations and 
other community stakeholders in 
developing the community benefits plan; 
and
``(III) a public hearing for any 
institution that has a received a 
`need-to-improve' or `low satisfactory' 
grade in any individual assessment area 
during the most recent examination.
``(2) Consideration of lending in partnership with non-
depository lenders.--
``(A) In general.--As part of assessing a financial 
institution under paragraph (1), the appropriate 
Federal financial supervisory agency shall evaluate the 
performance of the financial institution in originating 
loans for small farms, consumer loans (including 
residential mortgages, unsecured installment loans, 
advances, and lines of credit), and loans for small 
businesses (including unsecured installment loans, 
advances, and lines of credit) in partnership with 1 or 
more non-depository lenders.
``(B) Affordability and sustainability.--In making 
the evaluation described in subparagraph (A), the 
appropriate Federal financial supervisory agency shall 
consider the affordability and sustainability of the 
loan originations made in partnership with 1 or more 
non-depository lenders.
``(C) Definitions.--In this paragraph:
``(i) Non-depository lender.--The term 
`non-depository lender' means a lender that is 
not an insured depository institution.
``(ii) Small business; small farm.--The 
terms `small business' and `small farm' have 
the meanings given those terms under the 
regulations promulgated by the Bureau 
implementing the amendments made by section 
1071 of the Dodd Frank Wall Street Reform and 
Consumer Protection Act of 2010 (Public Law 
111-203; 124 Stat. 2056) under part 1002 of 
title 12, Code of Federal Regulations, or any 
successor regulation.
``(3) Deductions for fossil expansion.--
``(A) In general.--As part of assessing a financial 
institution under paragraph (1), the appropriate 
Federal financial supervisory agency shall--
``(i) determine the total dollar amount of 
loans and investments to fossil fuel companies 
for the purposes of fossil fuel expansion that 
were originated or held by the financial 
institution during the period covered by an 
examination under section 804; and
``(ii) deduct not more than that total 
dollar amount from the reported community 
development loans and investments of the 
financial institution, both in the aggregate 
and at the local market, or assessment area, 
level.
``(B) Activities.--The deduction described in 
subparagraph (A)(ii) may only be offset by financing by 
the institution of climate resiliency and disaster 
mitigation activities specifically targeted to 
underserved communities, such as--
``(i) the development of climate resilient 
affordable housing, schools, and small 
businesses (as defined in paragraph (2)(C));
``(ii) clean electricity projects and 
microgrids;
``(iii) nature-based protective 
infrastructure;
``(iv) building decarbonization, which 
includes holistic home weatherization and 
health interventions;
``(v) lending to green small businesses and 
companies with legitimate public 
decarbonization transition plans, strategies, 
and targets;
``(vi) electric public transit and electric 
vehicle charging infrastructure;
``(vii) investments in weatherization and 
climate resilience for local businesses;
``(viii) operational and technical support 
and capacity building for environmental and 
climate justice organizations, including 
support for community groups active in 
environmental testing and training of community 
members to identify climate or environmental 
risks and opportunities in their communities; 
and
``(ix) workforce development related to the 
transition away from fossil fuels, including 
activities to train workers on skills needed to 
participate in carbon-pollution-free energy 
sectors.
``(4) Penalties for sustained failing performance.--A 
regulated financial institution other than a U.S. nonbank 
mortgage originator that receives overall performance ratings 
under this section of `needs to improve' or `substantial 
noncompliance' for 2 consecutive examinations shall be subject 
to the following penalties, as deemed applicable by the 
appropriate Federal financial supervisory agency:
``(A) Restrictions on the institution's growth 
(overall or in discrete areas), business activities, or 
payment of dividends, including restrictions on ability 
to sell loans originated by the institution to 
enterprises, as defined in section 1303 of the Federal 
Housing Enterprises Financial Safety and Soundness Act 
of 1992 (12 U.S.C. 4502).
``(B) Recommendations to appropriate State agencies 
that State mortgage licenses be suspended or revoked 
with a statement of facts covering the justification 
for the recommended suspension or revocation.
``(C) Requiring the institution to simplify or 
reduce its operations, including that the institution 
reduce its asset size, divest subsidiaries or business 
lines, or exit from 1 or more markets of operation.
``(D) Recovery, or claw back, of portions of 
executive compensation received during consecutive 
evaluation periods under this section of which the 
institution received an overall performance rating of 
`needs to improve' or `substantial noncompliance'.
``(b) U.S. Nonbank Mortgage Originator.--
``(1) In general.--In connection with its examination of a 
U.S. nonbank mortgage originator, the appropriate Federal 
financial supervisory agency shall perform the following:
``(A) Assess the record of the U.S. nonbank 
mortgage originator in meeting the credit or other 
financial needs of its entire community, in particular 
low-income and moderate-income people and communities 
and other distressed or underserved communities and 
other underserved populations, consistent with the safe 
and sound operation of the U.S. nonbank mortgage 
originator.
``(B) Assess, as appropriate, the following 
activities in the assessment areas of the U.S. nonbank 
mortgage originator:
``(i) Retail lending, including home loans.
``(ii) Community development services.
``(iii) Community development lending and 
investments, which may include a consideration 
of--
``(I) the origination of loans and 
other efforts by the institution to 
assist existing low- and moderate-
income residents to remain in 
affordable housing in their community;
``(II) the origination of loans by 
the institution that result in the 
construction, rehabilitation or 
preservation of affordable housing 
units; and
``(III) investments in, grants to, 
or loans to community development 
financial institutions (as defined in 
section 103 of the Community 
Development Banking and Financial 
Institutions Act of 1994 (12 U.S.C. 
4702)), community development 
corporations (as defined in section 613 
of the Community Economic Development 
Act of 1981 (42 U.S.C. 9802)), and 
other nonprofit organizations serving 
the housing and development needs of 
the community.
``(iv) Retail lending assessment areas 
shall be established if not more than 90 
percent of the retail loans of the U.S. nonbank 
originator are in containing offices or agents. 
The evaluations shall also examine lending 
outside of retail lending assessment areas and 
assessment areas containing offices or agents. 
Evaluations of these loans shall be considered 
when assigning an institution level rating to 
the U.S. nonbank mortgage originator.
``(C) With respect to its evaluation of an 
application for a deposit facility by the U.S. nonbank 
mortgage originator--
``(i) consider the record described in 
subparagraph (A), the activities described in 
subparagraph (B), the overall rating of the 
U.S. nonbank mortgage originator under this 
section, and any improvement plans submitted 
pursuant to this section;
``(ii) provide an opportunity for public 
comment for a period of not less than 60 days;
``(iii) consider changes in the community 
reinvestment performance of the U.S. nonbank 
mortgage originator since the most recent 
rating under this section by the appropriate 
Federal financial supervisory agency; and
``(iv) require--
``(I) a demonstration that granting 
the application for a deposit facility 
is in the public interest, which shall 
include a submission of a community 
benefits plan, which shall be 
commensurate with the ability of the 
institution to accomplish the plan, by 
the U.S. nonbank mortgage originator to 
the appropriate Federal financial 
supervisory agency;
``(II) that the U.S. nonbank 
mortgage originator consult with 
community-based organizations and other 
community stakeholders in developing 
the community benefits plan; and
``(III) a public hearing for any 
U.S. nonbank mortgage originator that 
has a received a `need-to-improve' or 
`low satisfactory' grade in any 
individual assessment area during the 
most recent examination.
``(2) Penalties and fees.--The appropriate Federal 
financial supervisory agency shall have the same authority to 
assess penalties and fees under subsection (a)(4) for U.S. 
nonbank mortgage originator as is the case for regulated 
financial institutions described in subsection (a).
``(3) Authority to adjust examination and supervisory 
fees.--The appropriate Federal financial supervisory agencies 
shall have the authority to adjust the dollar amount of 
examination and supervisory fees, based in part on the rating 
of institutions under this section.
``(c) Requirements.--
``(1) In general.--In connection with its examination of a 
regulated financial institution under subsection (a) or (b), 
the appropriate Federal financial supervisory agency shall--
``(A) consider public comments received by the 
appropriate Federal financial supervisory agency 
regarding the record of the institution in meeting the 
credit or other financial needs of its entire 
community, including low- and moderate-income 
communities, and hold not less than 1 public hearing to 
receive comments for large banks with assets of not 
less than $50,000,000,000; and
``(B) require--
``(i) an improvement plan for an 
institution that receives a rating of `low 
satisfactory' or lower on the written 
evaluation of the institution, or such a rating 
in any individual assessment area; and
``(ii) the improvement plan described in 
clause (i) to result in the reasonable 
likelihood that the institution will obtain a 
rating of at least `high satisfactory' in 
meeting community credit or other financial 
needs in the relevant measure on the next 
examination.
``(2) Improvement plan.--
``(A) In general.--A regulated financial 
institution that is required to submit an improvement 
plan required under paragraph (1)(B) shall submit the 
plan in writing to the appropriate Federal financial 
supervisory agency not later than 90 days after 
receiving notice that the regulated financial 
institution is required to submit the plan.
``(B) Public comment.--Upon receipt of an 
improvement plan of a regulated financial institution 
required under paragraph (1)(B), the appropriate 
Federal financial supervisory agency shall--
``(i) make the plan available to the public 
for review and comment for a period of not less 
than 60 days; and
``(ii) require the regulated financial 
institution to revise, as appropriate, the 
improvement plan in response to the public 
comments received under the public review and 
comment period described in clause (i) and 
submit the plan to the appropriate Federal 
financial supervisory agency not later than 60 
days after the end of that period.
``(3) Examination of certain regulated financial 
institutions.--In the case of a regulated financial institution 
whose lending or other business is not clustered in 
geographical areas and is thinly dispersed across the country, 
the institution shall--
``(A) be evaluated under subsection (a) or (b), as 
applicable--
``(i) by considering the effectiveness of 
the institution in serving customers or 
borrowers, with a special emphasis on low- and 
moderate-income individuals and other 
underserved populations across the country 
regardless of where the individuals reside; and
``(ii) based on objective thresholds 
developed by the appropriate Federal financial 
supervisory agencies to clarify when lending or 
other business is dispersed across the country 
and not clustered in distinct geographical 
areas, which may include low levels of lending 
or other financial products across States or 
other areas; and
``(B) meet the needs of other distressed or 
underserved communities.
``(d) Consideration.--Remediation of consumers pursuant to an order 
by a court or administrative body or a settlement with a government 
agency or a private party may not be considered in an assessment 
conducted under subsection (a) or (b).
``(e) Rule of Construction.--An evaluation of a bank holding 
company under this section shall incorporate evaluations of subsidiary 
regulated financial institutions made by the appropriate Federal 
financial supervisory agency of each subsidiary, if applicable.'';
(C) in subsection (f), as so redesignated--
(i) by striking paragraph (2);
(ii) by redesignating paragraph (3) as 
paragraph (2); and
(iii) in paragraph (2), as so redesignated, 
by striking subparagraph (C); and
(D) in subsection (g), as so redesignated, by 
striking ``subsection (a)'' and inserting ``subsections 
(a) and (b)'';
(3) in section 807 (12 U.S.C. 2906)--
(A) in subsection (a)--
(i) by striking ``an insured depository 
institution'' and inserting ``a regulated 
financial institution''; and
(ii) by inserting ``or financial'' after 
``credit'';
(B) in subsection (b)--
(i) in paragraph (1)--
(I) in subparagraph (A)--
(aa) in clause (ii), by 
striking ``and'' at the end;
(bb) by redesignating 
clause (iii) as clause (iv); 
and
(cc) by inserting after 
clause (ii) the following:
``(iii) disclose whether the institution engaged in 
acts or practices that the Bureau of Consumer Financial 
Protection has determined, and has publicly disclosed, 
violate the enumerated consumer laws; and''; and
(II) by striking subparagraph (B) 
and inserting the following:
``(B) Evaluation on an assessment area basis.--The 
information required under subsections (a) and (b) of section 
804 shall be presented separately for each assessment area.
``(C) Treatment with respect to violations of enumerated 
consumer laws.--If a regulated financial institution has 
engaged in acts or practices that the appropriate Federal 
financial supervisory agency has determined to be unfair, 
deceptive, or abusive or acts or practices that violate 
enumerated consumer laws intended to ensure the fair, 
equitable, and nondiscriminatory access to credit for 
individuals and communities that are enforced by the Bureau of 
Consumer Financial Protection or other Federal or State 
agencies, the written evaluation shall be negatively influenced 
in a manner commensurate with the extent of the harm suffered 
by those individuals and communities.'';
(ii) in paragraph (2)--
(I) by striking subparagraphs (A), 
(B), (C), and (D) and inserting the 
following:
``(A) `Outstanding record of meeting community 
credit or other financial needs'.
``(B) `High Satisfactory record of meeting 
community credit or other financial needs'.
``(C) `Low Satisfactory record of meeting community 
credit or other financial needs'.
``(D) `Needs to improve record of meeting community 
credit or other financial needs'.
``(E) `Substantial noncompliance in meeting 
community credit or other financial needs'.''; and
(iii) by inserting after the flush text 
following paragraph (2) the following:
``(3) Additional authority.--The appropriate Federal 
financial supervisory agencies may--
``(A) alter the ratings under this subsection to 
change or include additional ratings for the overall 
ratings and subtest ratings; and
``(B) develop an accompanying point system that 
includes ranges for each rating category under 
paragraph (2).'';
(C) by redesignating subsection (e) as subsection 
(f); and
(D) by inserting after subsection (d) the 
following:
``(e) Appeals of Rating.--If a regulated financial institution 
appeals the assigned rating under this section, the appropriate Federal 
financial supervisory agency shall--
``(1) post a public notice of the appeal on the part of the 
website of the appropriate Federal financial supervisory agency 
that contains information on this title; and
``(2) provide an opportunity for public comment on the 
appeal.'';
(4) in section 806 (12 U.S.C. 2905)--
(A) by striking ``Regulations'' and inserting the 
following:
``(a) In General.--Regulations'';
(B) in subsection (a), as so designated, by 
striking ``companies,,'' and inserting ``companies,''; 
and
(C) by adding at the end the following:
``(b) Periodic Review.--Not later than 5 years after the date of 
enactment of this subsection and every 5 years thereafter, the 
appropriate Federal financial supervisory agencies shall--
``(1) review the regulations promulgated to carry out this 
title; and
``(2) report to Congress any recommendations for updates to 
the regulations and this title, which may include consideration 
of--
``(A) data collection under this title;
``(B) the rigor of evaluations under this title;
``(C) the assessment area coverage of loans and 
deposits; and
``(D) the extent to which the provisions of this 
title are reducing disparities in access to credit and 
capital by income and race.''; and
(5) by adding at the end the following:

``SEC. 810. DATA COLLECTION AND REPORTING REQUIREMENTS.

``(a) Data Collection.--
``(1) Consumer loans.--
``(A) In general.--Each regulated financial 
institution shall collect and maintain in machine 
readable form, as prescribed by the appropriate Federal 
financial supervisory agency, data for consumer loans 
originated or purchased by the regulated financial 
institution, including motor vehicle loans, credit 
cards, lines of credit, and other secured or unsecured 
loans. The regulated financial institution shall 
maintain data separately for each category of consumer 
loan, including the following for each loan:
``(i) A unique number or alpha-numeric 
symbol that can be used to identify the 
relevant loan.
``(ii) The loan amount at origination or 
purchase.
``(iii) The loan location.
``(iv) The gross annual income of the 
borrower that the regulated financial 
institution considered in making its credit 
decision.
``(B) Exemptions.--The appropriate Federal 
financial supervisory agencies may exempt classes of 
regulated financial institutions from the requirements 
under subparagraph (A) due to low levels of consumer 
lending or other factors.
``(2) Community development loans and investments.--
``(A) Collection and maintenance of data.--Each 
regulated financial institution shall collect and 
maintain in machine readable form, as prescribed by the 
appropriate Federal financial supervisory agency, data 
on the categories of community development lending and 
investments, including data regarding financing 
affordable housing, small business development, and 
economic development.
``(B) Public dissemination.--Each regulated 
financial institution and the appropriate Federal 
financial supervisory agencies shall--
``(i) publicly disseminate the data 
described in subparagraph (A) on a county level 
and for categories of census tracts including 
low- and moderate-income census tracts or other 
distressed and underserved census tracts; and
``(ii) consider disseminating the data 
described in subparagraph (A) by individual 
census tracts in addition to the categories 
described in clause (i).
``(3) Assessment area data.--
``(A) In general.--Each regulated financial 
institution shall collect and report to the appropriate 
Federal financial supervisory agency by March 1 of each 
year a list for each assessment area showing the 
geographies within the area.
``(B) Publication.--The appropriate Federal 
financial supervisory agencies shall make the list of 
assessment areas reported by each regulated financial 
institution under subparagraph (A) publicly available 
on the part of the website of the appropriate Federal 
financial supervisory agency that contains information 
on this title.
``(4) Deposits.--The appropriate Federal financial 
supervisory agencies shall--
``(A) collect data from regulated financial 
institutions that reflects--
``(i) the number of customers of those 
institutions that reside in categories of 
census tracts including low- and moderate-
income census tracts or other distressed and 
underserved census tracts and the dollar amount 
of deposits of those customers; and
``(ii) the number of small businesses that 
are located in the census tract categories 
described in clause (i); and
``(B) consider the dissemination of the deposit 
data collected under subparagraph (A) by individual 
census tracts in addition to the categories described 
in that subparagraph.
``(b) Aggregate Disclosure Statements.--
``(1) In general.--Each appropriate Federal financial 
supervisory agency shall prepare annually, for each assessment 
area, a disclosure statement of home, small business, small 
farm, and consumer lending for each regulated financial 
institution subject to reporting under this section and an 
aggregated statement for all reporting institutions combined, 
which shall indicate, for each assessment area, the number and 
amount of all small business, small farm, and consumer loans 
originated or purchased sorted by income level of borrowers, 
race and ethnicity of borrowers, revenue size of small 
businesses and farms, and categories of census tracts.
``(2) Deposits and community development loans and 
investments.--An appropriate Federal financial supervisory 
agency shall include data on deposits and community development 
loans and investments in the disclosure statements prepared 
under paragraph (1).
``(3) Adjusted form.--An appropriate Federal financial 
supervisory agency may adjust the form of the disclosure 
statement prepared under paragraph (1) if necessary, because of 
special circumstances, to protect the privacy of a borrower or 
the competitive position of a regulated financial institution.
``(c) Central Data Depositories.--The Federal Financial 
Institutions Examination Council, in consultation with the appropriate 
Federal financial supervisory agencies, shall implement a system--
``(1) to allow the public to access online and in a 
searchable format the data maintained under paragraphs (1) 
through (4) of subsection (a); and
``(2) that ensures that personally identifiable financial 
information is not disclosed to public.
``(d) Limitation.--An appropriate Federal financial supervisory 
agency may not use the authorities of the appropriate Federal financial 
supervisory agency under this section to obtain a record from a 
regulated financial institution for the purpose of gathering or 
analyzing the personally identifiable financial information of a 
consumer.

``SEC. 811. COMMUNITY ADVISORY COMMITTEES.

``(a) Depository Institutions.--Each regulated financial 
institution that is not a U.S. nonbank mortgage originator shall form a 
separate Community Advisory Committee (which shall be composed of a 
diverse set of consumer, housing, community development, and other 
stakeholder groups) in each of the following:
``(1) With respect to a depository institution with 
consolidated assets equal to or greater than $2,000,000,000 the 
branches of which are located in 1 census region, each 
metropolitan statistical area where the financial institution 
or any subsidiaries of the financial institution have a branch 
or other facility (including an automated teller machine) and 
each metropolitan statistical area where the financial 
institution has a substantial number of customers who maintain 
deposit accounts with the financial institution.
``(2) With respect to a depository institution with 
consolidated assets equal to or greater than $2,000,000,000 the 
branches of which are located in more than 1 census region, 
each census division within each of the regions.
``(3) With respect to a depository institution with 
consolidated assets of less than $2,000,000,000, each State 
where the financial institution or any subsidiaries of the 
financial institution are located.
``(b) U.S. Nonbank Mortgage Originators.--Each U.S. nonbank 
mortgage originator shall form a separate Community Advisory Committee 
(which shall be composed of a diverse set of consumer, housing, 
community development, and other stakeholder groups) in each of the 
following:
``(1) With respect to a U.S. nonbank mortgage originator 
that is required to make a number of disclosures under the Home 
Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) that 
is less than the national median, each State in which the U.S. 
nonbank mortgage originator offers loans.
``(2) With respect to a U.S. nonbank mortgage originator 
that is required to make a number of disclosures under the Home 
Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) that 
is more than the national median, each census division within 
the census regions in which the U.S. nonbank mortgage 
originator offers loans.
``(c) Biannual Consultation.--The executives of each regulated 
financial institution shall meet not less frequently than twice per 
year with the Community Advisory Committees of the regulated financial 
institution formed under subsection (a) or (b), as applicable--
``(1) to discuss the financial institution's current work 
to meet the credit and deposit needs of low- and moderate-
income individuals and underserved communities, persons with 
disabilities, LGBTQ+ communities, and Chinese, Asian Indian, 
Filipino, Japanese, Korean, Vietnamese, Pakistani, Cambodian, 
Hmong, Laotian, Thai, Taiwanese, Burmese, Bangladeshi, 
Nepalese, Indonesian, Malaysian, Hispanic or Latino, Black or 
African American, American Indian and Alaska Native, Native 
Hawaiian, Samoan, Chamorro, Tongan, iTaukei, Marshallese, and 
Other Pacific Islander communities, as applicable to the 
geographic areas of the financial institution;
``(2) with respect to an institution described in 
subsection (a)(2) or a U.S. nonbank mortgage originator 
described in subsection (b)(2), to assist the executives in 
developing and updating a plan for how the institution will 
work to meet the credit needs of the institution's entire 
community, including low- and moderate-income neighborhoods; 
and
``(3) to discuss the institution's data (which shall be 
disaggregated by Chinese, Asian Indian, Filipino, Japanese, 
Korean, Vietnamese, Pakistani, Cambodian, Hmong, Laotian, Thai, 
Taiwanese, Burmese, Bangladeshi, Nepalese, Indonesian, 
Malaysian, Hispanic or Latino, Black or African American, 
American Indian and Alaska Native, and Native Hawaiian, Samoan, 
Chamorro, Tongan, iTaukei, Marshallese and Other Pacific 
Islander communities, as applicable to the institution's 
geographic areas) on--
``(A) mortgage lending and lending to small 
businesses and small farms, as defined in section 
804(a)(2)(C);
``(B) retail products and services;
``(C) community development services; and
``(D) community development financing.
``(d) Specific Consultations.--In addition to the consultations 
required under paragraph (2), the executives of a depository 
institution described in subsection (a)(2) shall meet with the 
Community Advisory Committee of the institution before--
``(1) the institution applies for a merger or acquisition;
``(2) the institution, or any subsidiary of the 
institution, applies for deposit insurance;
``(3) the institution applies to open a new branch or to 
relocate an existing branch; or
``(4) the institution provides notice that it would close a 
branch or other facility.

``SEC. 812. STUDY ON DISCRIMINATION AND DISPARITIES IN ACCESS TO 
CREDIT.

``(a) Study.--Not later than the end of the 2-year period beginning 
on the date of enactment of this section, and every 2 years thereafter, 
the appropriate Federal financial supervisory agencies shall, jointly, 
and in consultation with such other Federal or State agencies as the 
appropriate Federal financial supervisory agencies determine 
appropriate, complete an interagency statistical study to identify--
``(1) metropolitan areas and rural counties that either 
experience ongoing discrimination or exhibit significant racial 
disparities in access to credit for any racial or ethnic group; 
and
``(2) significant disparities in access to branches by 
racial or ethnic composition of census tract and disparities in 
access to community development financing by racial or ethnic 
composition of census tract.
``(b) Use of Data.--In carrying out each study required under 
subsection (a), the appropriate Federal financial supervisory agencies 
shall make use of data including--
``(1) data obtained under the Home Mortgage Disclosure Act 
of 1975 (12 U.S.C. 2801 et seq.);
``(2) data obtained under section 704B of the Equal Credit 
Opportunity Act (15 U.S.C. 1691c-2);
``(3) data obtained under this Act;
``(4) available State data; and
``(5) information contained in public litigation against 
regulated financial institutions for redlining or lending 
discrimination (including litigation initiated by the Bureau of 
Consumer Financial Protection, the Department of Housing and 
Urban Affairs, the Department of Justice, or by private 
parties).
``(c) Report.--Upon the completion of each study required under 
subsection (a), the appropriate Federal financial supervisory agencies 
shall jointly submit to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services of the 
House of Representatives a report that includes--
``(1) all findings and determinations made in carrying out 
the study; and
``(2) policy recommendations to remedy the discrimination 
and disparities identified in the study.

``SEC. 813. PUBLIC REGISTRIES.

``The appropriate Federal supervisory financial agencies, acting 
through the Federal Financial Institutions Examination Council, shall--
``(1) maintain a list of community-based organizations and 
other stakeholders who wish to be listed and who have commented 
on examinations conducted under section 804 and applications 
regarding community needs and bank performance; and
``(2) conduct outreach to community groups and strive for 
geographical diversity, gender and racial diversity, and 
diversity in terms of various types of needs, including 
affordable housing and economic development to community 
facilities.''.
(c) Amendment to the Bank Holding Company Act of 1956.--Section 
4(k)(6) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)(6)) 
is amended to read as follows:
``(6) Notice and opportunity for comment required.--
``(A) In general.--No financial holding company 
shall directly or indirectly acquire, and no company 
that becomes a financial holding company shall directly 
or indirectly acquire control of, any company in the 
United States, including through merger, consolidation, 
or other type of business combination, that is engaged 
in activities permitted under this subsection or 
subsection (n) or (o), unless--
``(i) the holding company has provided 
notice to the Board, not later than 60 days 
prior to the proposed acquisition or prior to 
becoming a financial holding company, and 
during that time period, or such longer time 
period not exceeding an additional 60 days, as 
established by the Board;
``(ii) the Board has provided public notice 
and opportunity for comment for not less than 
60 days; and
``(iii) the Board has not issued a notice 
disapproving the proposed acquisition or 
retention.
``(B) Factors for consideration.--In reviewing any 
prior notice filed under this paragraph, the Board 
shall--
``(i) consider the overall rating of the 
financial holding company under the Community 
Reinvestment Act of 1977 (12 U.S.C. 2901 et 
seq.) and any improvement plans submitted 
pursuant to that Act;
``(ii) provide opportunity for public 
comment for a period of not less than 60 days;
``(iii) consider changes in the community 
reinvestment performance of the financial 
holding company since the last rating under the 
Community Reinvestment Act of 1977 (12 U.S.C. 
2901 et seq.) by the appropriate Federal 
financial supervisory agency; and
``(iv) require--
``(I) a demonstration that granting 
the application for a deposit facility 
is in the public interest, which shall 
include submission to the appropriate 
Federal financial supervisory agency of 
a community benefits plan commensurate 
with the ability of the institution to 
carry out that plan;
``(II) that the institution consult 
with community-based organizations and 
other community stakeholders in 
developing the community benefits plan; 
and
``(III) a public hearing for any 
bank that has received a `need-to-
improve' or `low satisfactory' grade in 
any assessment area during the last 
examination under the Community 
Reinvestment Act of 1977 (12 U.S.C. 
2901 et seq.).''.
(d) Technical and Conforming Amendment.--Section 10(c)(2)(H)(i) of 
the Home Owners' Loan Act (12 U.S.C. 1467a(c)(2)(H)(i)) is amended by 
striking ``section 804(c) of the Community Reinvestment Act of 1977 (12 
U.S.C. 2903(c))'' and inserting ``section 804(f) of the Community 
Reinvestment Act of 1977 (12 U.S.C. 2903(f))''.

SEC. 204. AMENDMENTS RELATING TO CREDIT UNION SERVICE TO UNDERSERVED 
AREAS.

(a) In General.--The Federal Credit Union Act (12 U.S.C. 1751 et 
seq.) is amended--
(1) in section 101 (12 U.S.C. 1752)--
(A) in paragraph (8), by striking ``and'' at the 
end;
(B) in paragraph (9), by striking the period at the 
end and inserting ``; and''; and
(C) by adding at the end the following:
``(10) the term `underserved area'--
``(A) means a local community, neighborhood, or 
rural district that--
``(i) is an investment area, as defined in 
section 103 of the Community Development 
Banking and Financial Institutions Act of 1994 
(12 U.S.C. 4702), that meets such additional 
requirements that the Board may impose; and
``(ii) is underserved, based on data of the 
Board and the Federal banking agencies (as 
defined in section 3 of the Federal Deposit 
Insurance Act (12 U.S.C. 1813)), by other 
depository institutions (as defined in section 
19(b)(1)(A) of the Federal Reserve Act (12 
U.S.C. 461(b)(1)(A)); and
``(B) notwithstanding subparagraph (A), includes, 
with respect to any Federal credit union, any 
geographic area within which the credit union--
``(i) has received approval to provide 
service as an underserved area before the date 
of enactment of this paragraph from the 
Administration; and
``(ii) has established a service facility 
before that date of enactment.'';
(2) in section 106 (12 U.S.C. 1756)--
(A) in the first sentence, by striking ``Federal'' 
and inserting ``(a) Federal''; and
(B) by adding at the end the following:
``(b) The Board shall monitor adherence by a Federal credit union 
to a significant unmet needs plan submitted under section 109(h) by 
that Federal credit union that describes how the Federal credit union 
will serve the deposit and other financial needs of the community.''; 
and
(3) in section 109 (12 U.S.C. 1759)--
(A) in subsection (c), by amending paragraph (2) to 
read as follows:
``(2) Exception for underserved areas.--
``(A) In general.--Notwithstanding subsection (b), 
the Board may approve an application by a Federal 
credit union to allow the membership of the credit 
union to include any person or organization whose 
principal residence or place of business is located 
within a local community, neighborhood, or rural 
district if--
``(i) the Board determines--
``(I) at any time after August 7, 
1998, that the local community, 
neighborhood, or rural district taken 
into account for purposes of this 
paragraph is an underserved area; and
``(II) at the time of the approval, 
that the credit union is well 
capitalized or adequately capitalized 
(as defined in section 216(c)(1)); and
``(ii) before the end of the 24-month 
period beginning on the date of the approval, 
the credit union has established and maintains 
an ongoing method to provide services in the 
local community, neighborhood, or rural 
district.
``(B) Termination of approval.--
``(i) In general.--Any failure of a Federal 
credit union to meet the requirement of clause 
(ii) of subparagraph (A) by the end of the 24-
month period referred to in that clause shall 
constitute a termination, as a matter of law, 
of any approval of an application under this 
paragraph by the Board with respect to the 
membership of the credit union.
``(ii) Significant unmet needs plan.--The 
Board may terminate the approval of an 
application under this paragraph with respect 
to the membership of a Federal credit union 
upon a finding that the credit union is not 
meeting the terms of the significant unmet 
needs plan of the credit union submitted under 
subsection (h)(1).
``(C) Credit union reporting requirement.--Any 
Federal credit union that has an application approved 
under this paragraph shall, as part of the ordinary 
course of the examination cycle and supervision 
process, submit a report to the Administration that 
includes--
``(i) the number of members of the credit 
union who are members by reason of the 
application;
``(ii) the number of offices or facilities 
maintained by the credit union in the local 
community, neighborhood, or rural district 
taken into account by the Board in approving 
the application; and
``(iii) evidence, as specified by the Board 
by regulation, demonstrating compliance by the 
credit union with the significant unmet needs 
plan submitted by the credit union under 
subsection (h)(1), as specified by the 
Administration.
``(D) Publication by administration.--The 
Administration shall publish an annual report 
containing--
``(i) a list of all the applications 
approved under this paragraph before the date 
on which the report is published;
``(ii) the number and locations of the 
underserved areas taken into account in 
approving those applications;
``(iii) the total number of members of 
credit unions who are members by reason of the 
approval of those applications; and
``(iv) evidence demonstrating compliance by 
credit unions with significant unmet needs 
plans submitted by the credit unions under 
subsection (h)(1), as specified by the 
Administration.'';
(B) in subsection (e)(2), by inserting ``subsection 
(c)(2) and'' after ``provided in''; and
(C) by adding at the end the following:
``(h) Additional Requirements for Community Credit Unions.--
``(1) In general.--A Federal credit union desiring a field 
of membership as a credit union described in subsection (b)(3) 
shall submit to the Board a business plan, which shall include, 
among other issues, a marketing plan that identifies--
``(A) the unique needs of the various demographic 
groups in the proposed community; and
``(B) how the credit union will market to each 
group, particularly underserved groups, to address 
those needs.
``(2) Public comment and hearing.--With respect to a 
Federal credit union desiring a field of membership as a credit 
union described in subsection (b)(3) for an area with multiple 
political jurisdictions with a population of not less than 
2,500,000, the Administration shall--
``(A) publish a notice in the Federal Register 
seeking comment from interested parties about the 
proposed community; and
``(B) conduct a public hearing regarding the 
application of the Federal credit union.''.
(b) Regulations.--Not later than 1 year after the date of enactment 
of this Act, the National Credit Union Administration Board shall issue 
final regulations to implement the amendments made by subsection (a).

SEC. 205. RAISING PUBLIC WELFARE CAPS.

(a) National Banks.--The paragraph designated as the ``Eleventh.'' 
of section 5136 of the Revised Statutes of the United States (12 U.S.C. 
24) is amended to read as follows: ``Eleventh. To make investments 
directly or indirectly, each of which promotes the public welfare by 
benefitting primarily low- and moderate-income communities or families 
(such as by providing housing, services, or jobs). An association shall 
not make any such investment if the investment would expose the 
association to unlimited liability. The Comptroller of the Currency 
shall limit an association's investments in any 1 project and an 
association's aggregate investments under this paragraph. Aggregate 
investments for associations that do not meet the criteria of being 
well capitalized, as defined in section 24.2(e) of title 12, Code of 
Federal Regulations, or any successor regulation, under this paragraph 
shall not exceed an amount equal to the sum of 5 percent of the 
association's capital stock actually paid in and unimpaired and 5 
percent of the association's unimpaired surplus fund, unless the 
Comptroller determines by order that the higher amount will pose no 
significant risk to the affected deposit insurance fund, and the 
association is adequately capitalized. In no case shall aggregate 
investments of an association that do not meet the criteria for being 
well capitalized under this paragraph exceed an amount equal to the sum 
of 15 percent of the association's capital stock actually paid in and 
unimpaired and 15 percent of the association's unimpaired surplus fund. 
Aggregate investments of well capitalized associations, as defined in 
section 24.2(e) of title 12, Code of Federal Regulations, or any 
successor regulation, under this paragraph shall not exceed an amount 
equal to the sum of 15 percent of the association's capital stock 
actually paid in and unimpaired and 15 percent of the association's 
unimpaired surplus fund, unless the Comptroller determines by order 
that the higher amount will pose no significant risk to the affected 
deposit insurance fund. With respect to any association that meets the 
criteria for being well capitalized, as defined in section 24.2(e) of 
title 12, Code of Federal Regulations, or any successor regulation, 
aggregate investments under this paragraph shall not exceed an amount 
equal to the sum of 25 percent of the association's capital stock 
actually paid in and unimpaired and 25 percent of the association's 
unimpaired surplus fund. The foregoing standards and limitations apply 
to investments under this paragraph made by a national bank directly 
and by its subsidiaries.''.
(b) Conforming Amendments for State Member Banks.--The 23rd 
undesignated paragraph of section 9 of the Federal Reserve Act (12 
U.S.C. 338a) is amended to read as follows:
``A State member bank may make investments directly or 
indirectly, each of which promotes the public welfare by 
benefitting primarily low- and moderate-income communities or 
families (such as by providing housing, services, or jobs), to 
the extent permissible under State law. A State member bank 
shall not make any such investment if the investment would 
expose the State member bank to unlimited liability. Aggregate 
investments for State member banks that do not meet the 
criteria of being well capitalized, as defined in section 
208.43(b) of title 12, Code of Federal Regulations, or any 
successor regulation, under this paragraph shall not exceed an 
amount equal to the sum of 5 percent of the association's 
capital stock actually paid in and unimpaired and 5 percent of 
the association's unimpaired surplus fund, unless the Board 
determines by order that the higher amount will pose no 
significant risk to the affected deposit insurance fund, and 
the association is adequately capitalized. In no case shall 
aggregate investments of a State member bank that does not meet 
the criteria for being well capitalized under this paragraph 
exceed an amount equal to the sum of 15 percent of the 
association's capital stock actually paid in and unimpaired and 
15 percent of the association's unimpaired surplus fund. 
Aggregate investments of well capitalized State member banks, 
as defined in section 208.43(b) of title 12, Code of Federal 
Regulations, or any successor regulation, with an examination 
rating under section 804 of the Community Reinvestment Act of 
1977 (12 U.S.C. 2903) of `outstanding' or `satisfactory', under 
this paragraph shall not exceed an amount equal to the sum of 
15 percent of the State member bank's capital stock actually 
paid in and unimpaired and 15 percent of the state member 
Bank's unimpaired surplus fund, unless the Board determines by 
order that the higher amount will pose no significant risk to 
the affected deposit insurance fund. With respect to any State 
member bank that meets meet the criteria for being well 
capitalized as defined in section 208.43(b) of title 12, Code 
of Federal Regulations, or any successor regulation, with an 
examination rating under section 804 of the Community 
Reinvestment Act of 1977 (12 U.S.C. 2903) of `outstanding' or 
`satisfactory', aggregate investments under this paragraph 
shall not exceed an amount equal to the sum of 25 percent of 
the State member bank's capital stock actually paid in and 
unimpaired and 25 percent of the State member bank's unimpaired 
surplus fund. The foregoing standards and limitations apply to 
investments under this paragraph made by a State member bank 
directly and by its subsidiaries.''.

SEC. 206. TEMPORARY ELIGIBILITY OF CERTAIN DIRECT DESCENDANTS OF 
CERTAIN VETERANS FOR HOUSING LOANS GUARANTEED BY THE 
SECRETARY OF VETERANS AFFAIRS.

(a) In General.--During the period described in subsection (b)--
(1) section 3701(b) of title 38, United States Code, shall 
be applied and administered by adding at the end the following 
new paragraph:
``(8)(A) The term `veteran' also includes, for purposes of 
home loans, any direct descendant of a veteran described in 
subparagraph (B) if the descendant--
``(i) is living on the date of the enactment of the 
American Housing and Economic Mobility Act of 2025;
``(ii) is a first-time homebuyer; and
``(iii) is a first-generation homebuyer.
``(B) A veteran described in this clause is a veteran who--
``(i) served on active duty at any time during the 
period between June 22, 1944, and April 11, 1968;
``(ii) is deceased; and
``(iii) did not receive a housing loan benefit 
under this chapter during his or her lifetime.
``(C) In this paragraph:
``(i) The term `direct descendant' includes a 
legally adopted descendant.
``(ii) The terms `first-generation homebuyer' and 
`first-time homebuyer' have the meanings given those 
terms in section 201(a) of the American Housing and 
Economic Mobility Act of 2025.''; and
(2) section 3702(a)(2) of such title shall be applied and 
administered by adding at the end the following new 
subparagraph:
``(H) Each direct descendant described in section 
3701(b)(8) of this title.''.
(b) Period Described.--The period described in this subsection is 
the period beginning one year after the date of the enactment of this 
Act and ending ten years after the date on which the Secretary of 
Veterans Affairs prescribes the regulations required by subsection (c).
(c) Regulations.--
(1) In general.--Not later than 180 days after the date of 
the enactment of this Act, the Secretary of Veterans Affairs 
shall prescribe regulations to carry out this section.
(2) Elements.--The regulations required by paragraph (1) 
shall provide rules and procedures for determining--
(A) the eligibility of a direct descendant for 
housing loan benefits under this section when the 
records of the Veterans Benefits Administration are 
incomplete or otherwise inadequate to verify 
eligibility; and
(B) appropriate implementation of this section if 
more than one direct descendant of a veteran seeks 
housing loan benefits under this section.

TITLE III--REMOVING BARRIERS THAT ISOLATE COMMUNITIES

SEC. 301. EXPANDING RIGHTS UNDER THE FAIR HOUSING ACT.

(a) Purposes.--The purposes of the amendments made by this section 
are--
(1) to expand, as well as clarify, confirm, and create 
greater consistency in, the protections against discrimination 
on the basis of all covered characteristics; and
(2) to provide guidance and notice to individuals, 
organizations, corporations, and agencies regarding their 
obligations under Federal law.
(b) Amendments to the Fair Housing Act.--The Fair Housing Act (42 
U.S.C. 3601 et seq.) is amended--
(1) in section 802 (42 U.S.C. 3602), by adding at the end 
the following:
``(p) `Gender identity' means the gender-related identity, 
appearance, or mannerisms or other gender-related characteristics of an 
individual, regardless of the individual's designated sex at birth.
``(q) `Marital status' has the meaning given the term in section 
202.2 of title 12, Code of Federal Regulations, or any successor 
regulation.
``(r) `Sexual orientation' means homosexuality, heterosexuality, or 
bisexuality.
``(s) `Source of income' includes income for which there is a 
reasonable expectation that the income will continue from--
``(1) a profession, occupation, or job;
``(2) any government or private assistance, grant, loan, or 
rental assistance program, including vouchers issued under the 
United States Housing Act of 1937 (42 U.S.C. 1437 et seq.);
``(3) a gift, an inheritance, a pension, an annuity, 
alimony, child support, or other consideration or benefit; or
``(4) the sale or pledge of property or an interest in 
property.
``(t) `Veteran status' means--
``(1) a member of the uniformed services, as defined in 
section 101 of title 10, United States Code; or
``(2) a veteran, as defined in section 101 of title 38, 
United States Code.'';
(2) in section 804 (42 U.S.C. 3604)--
(A) by inserting ``actual or perceived'' before 
``race, color'' each place that term appears;
(B) by striking ``sex,'' each place that term 
appears and inserting ``sex (including sexual 
orientation and gender identity), marital status, 
source of income, veteran status,''; and
(C) in subsection (c)--
(i) by inserting ``(1)'' before ``To 
make''; and
(ii) by adding at the end the following:
``(2) Nothing in this title shall be construed to--
``(A) prohibit a lender from implementing a loan program 
for veterans or based upon veteran status; or
``(B) prohibit an entity from providing housing assistance 
under--
``(i) section 8(o)(19) of the United States Housing 
Act of 1937 (42 U.S.C. 1437f(o)(19));
``(ii) the Homeless Providers Grant and Per Diem 
program of the Department of Veterans Affairs; or
``(iii) any other Federal housing assistance 
program for veterans or based on veteran status.'';
(3) in section 805 (42 U.S.C. 3605)--
(A) by inserting ``actual or perceived'' before 
``race, color'' each place that term appears; and
(B) by striking ``sex,'' each place that term 
appears and inserting ``sex (including sexual 
orientation and gender identity), marital status, 
source of income, veteran status,'';
(4) in section 806 (42 U.S.C. 3606)--
(A) by inserting ``actual or perceived'' before 
``race, color''; and
(B) by striking ``sex,'' each place that term 
appears and inserting ``sex (including sexual 
orientation and gender identity), marital status, 
source of income, veteran status,''; and
(5) in section 808(e)(6) (42 U.S.C. 3608(e)(6)), by 
striking ``sex,'' and inserting ``sex (including sexual 
orientation and gender identity), marital status, source of 
income, veteran status,''.
(c) Prevention of Intimidation.--Section 901 of the Civil Rights 
Act of 1968 (42 U.S.C. 3631) is amended--
(1) by inserting ``actual or perceived'' before ``race, 
color'' each place that term appears; and
(2) by striking ``sex,'' each place that term appears and 
inserting ``sex (including sexual orientation (as such term is 
defined in section 802 of this Act) and gender identity (as 
defined in section 802 of this Act)), marital status (as 
defined in section 802), source of income (as defined in 
section 802), veteran status (as defined in section 802),''.
(d) Rule of Construction.--Nothing in the amendments made by this 
section shall be construed to mean that a particular class of 
individuals was not protected against discrimination under Federal law 
as in effect on the day before the date of enactment of this Act.

SEC. 302. IMPROVING OUTCOMES IN HOUSING ASSISTANCE PROGRAMS.

(a) Indian Housing Assistance.--Section 502 of the Native American 
Housing Assistance and Self-Determination Act of 1996 (25 U.S.C. 4181) 
is amended by adding at the end the following:
``(c) Applicability.--Subsections (a) and (b) shall not apply with 
respect to tenant-based assistance provided under section 8(o) of the 
United States Housing Act of 1937 (42 U.S.C. 1437f(o)).''.
(b) Supplemental Administrative Fee.--Section 8(q)(2)(B) of the 
United States Housing Act of 1937 (42 U.S.C. 1437f(q)(2)(B)) is amended 
by inserting ``, including the cost of assisting families with children 
or families with a member with a disability that move to lower poverty, 
higher opportunity neighborhoods (as determined by the Secretary based 
on objective, evidence-based criteria)'' after ``programs''.
(c) Regional Planning To Increase Access to Higher Opportunity 
Areas.--Section 8(o) of the United States Housing Act of 1937 (42 
U.S.C. 1437f(o)) is amended by adding at the end the following:
``(23) Increasing access to higher opportunity areas.--
``(A) Location analysis.--
``(i) In general.--A public housing agency 
that administers the program under this 
subsection in a metropolitan area shall--
``(I) analyze the locations where 
the participants in the program of the 
public housing agency live; and
``(II) based on the analysis 
described in subclause (I), establish 
policies and practices to reduce 
disparities and barriers to access to 
locations throughout the metropolitan 
area that evidence indicates are more 
likely to improve outcomes for children 
or adults.
``(ii) Considerations.--The location 
analysis required under this subparagraph 
shall--
``(I) consider separately the 
locations of families with children, 
households that include a person with 
disabilities, and other groups 
protected under the Fair Housing Act 
(42 U.S.C. 3601 et seq.); and
``(II) include an analysis of the 
locations in relation to dwelling units 
with rents that are potentially 
affordable to voucher holders and the 
likely impact of key neighborhood 
attributes on their well-being and 
long-term success, based on Federal and 
available local data.
``(iii) Mapping tools.--The Secretary 
shall--
``(I) provide mapping tools and 
other information necessary for a 
public housing agency to perform the 
location analysis under this 
subparagraph using the demographic data 
on participating families submitted to 
the Secretary under part 908 of title 
24, Code of Federal Regulations, or any 
successor regulation;
``(II) publish a notice in the 
Federal Register, subject to public 
comment, that specifies the data 
sources and definitions that will be 
incorporated in each mapping tool 
required under subclause (I); and
``(III) update the notice required 
under subclause (II) as needed based on 
changes in the availability of relevant 
data or evidence of neighborhood 
attributes likely to impact the well-
being and long-term success of 
participants in the program under this 
subsection.
``(iv) Frequency and availability.--The 
location analysis required under this 
subparagraph shall--
``(I) be performed by each public 
housing agency described in clause (i) 
not less frequently than once every 5 
years;
``(II) be performed by all public 
housing agencies in a metropolitan area 
in the same year, as determined by the 
Secretary; and
``(III) be made available to the 
public in a manner that protects the 
privacy of program participants.
``(B) Regional policies to increase access to 
higher opportunity neighborhoods.--Each public housing 
agency described in subparagraph (A)(i) shall--
``(i) consult with other such public 
housing agencies in the same metropolitan area, 
or smaller regional area approved by the 
Secretary, about the possible barriers and 
other reasons for the disparities identified in 
the location analysis required under 
subparagraph (A);
``(ii) identify policies or practices that 
those public housing agencies could adopt 
individually or in collaboration, or other 
strategies that recipients of grants or other 
funding from the Secretary could adopt, to 
reduce the barriers and disparities and 
increase the share of families with children 
and other demographic groups using vouchers in 
higher-opportunity neighborhoods in the 
metropolitan area or region; and
``(iii) include in the administrative plan 
required under section 982.54 of title 24, Code 
of Federal Regulations, or any successor 
regulation, the policies that the public 
housing agency has adopted under this 
paragraph.
``(C) Assessment.--The Secretary shall include 
public housing agency performance in achieving the goal 
described in subparagraph (A)(i)(II) in the periodic 
assessment of agency performance in managing the 
program under this subsection required under part 985 
of title 24, Code of Federal Regulations, or any 
successor regulation.''.
(d) Required Regulatory Changes to Public Housing Agency 
Consortia.--
(1) Definitions.--In this subsection:
(A) Moving to work demonstration program.--The term 
``Moving to Work demonstration program'' means the 
program established under section 204 of the 
Departments of Veterans Affairs and Housing and Urban 
Development, and Independent Agencies Appropriations 
Act, 1996 (Public Law 104-134; 110 Stat. 1321-281).
(B) Public housing agency.--The term ``public 
housing agency'' has the meaning given the term in 
section 3(b)(6) of the United States Housing Act of 
1937 (42 U.S.C. 1437a(b)(6)).
(2) Requirement.--Not later than 1 year after the date of 
enactment of this Act, the Secretary of Housing and Urban 
Development shall establish policies and procedures that--
(A) enable public housing agencies that elect to 
operate in consortia under section 13(a) of the United 
States Housing Act of 1937 (42 U.S.C. 1437k(a)), 
excluding public housing agencies participating in the 
Moving to Work demonstration program--
(i) to consolidate their funding contracts 
for assistance provided under section 8(o) of 
such Act (42 U.S.C. 1437f(o)) into a single 
contract;
(ii) to consolidate their funding contracts 
for assistance provided under subsections (d) 
and (e) of section 9 of such Act (42 U.S.C. 
1437g); or
(iii) to exercise the consolidation options 
under each of clauses (i) and (ii); and
(B) enable public housing agencies to form partial 
consortia under such section 13(a) (42 U.S.C. 1437k(a)) 
that consolidate the administration of certain aspects 
of their housing programs to increase access to higher-
opportunity areas or for other purposes, subject to 
such requirements as the Secretary may establish.
(3) Moving to work agencies.--Any flexibility or waiver 
applicable to the Moving to Work demonstration program shall 
not apply to any activities or funds administered through a 
partial consortium formed under paragraph (2)(B) by 1 or more 
public housing agencies participating in the Moving to Work 
demonstration program.

TITLE IV--ESTATE TAX REFORM

SEC. 401. AMENDMENT TO INTERNAL REVENUE CODE OF 1986.

Except as otherwise expressly provided, whenever in this title an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Internal Revenue Code of 
1986.

SEC. 402. RATE ADJUSTMENT.

(a) Increase in Estate Tax Rates.--The table contained in section 
2001(c) is amended to read as follows:

If the amount with respect to which The tentative tax is:
the tentative tax to be 
computed is:
Not over $13,000,000...........
55 percent of such amount.
Over $13,000,000 but not over 
$93,000,000.
$7,150,000, plus 60 percent of 
the excess of such 
amount over 
$13,000,000.
Over $93,000,000...............
$55,150,000, plus 65 percent of 
the excess of such 
amount over 
$93,000,000.

(b) Reduction of Basic Exclusion Amount.--Paragraph (3) of section 
2010(c) is amended to read as follows:
``(3) Basic exclusion amount.--For purposes of this 
subsection, the basic exclusion amount is $3,500,000.''.
(c) Surtax on Billion Dollar Estates.--Section 2001 is amended--
(1) in subsection (b), by striking ``The tax'' and 
inserting ``Subject to subsection (h), the tax'', and
(2) by adding at the end the following new subsection:
``(h) Surtax on Billion Dollar Estates.--
``(1) In general.--In the case of a taxable estate for 
which the applicable amount is in excess of $1,000,000,000, the 
tax determined under subsection (b) shall be increased by an 
amount equal to 10 percent of such applicable amount.
``(2) Applicable amount.--For purposes of this subsection, 
the applicable amount shall be equal to the sum of the amounts 
under subparagraphs (A) and (B) of paragraph (1) of subsection 
(b) for the taxable estate.''.
(d) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and generation-skipping transfers 
and gifts made, after the date of the enactment of this Act.

SEC. 403. REQUIRED MINIMUM 10-YEAR TERM, ETC., FOR GRANTOR RETAINED 
ANNUITY TRUSTS.

(a) In General.--Subsection (b) of section 2702 is amended--
(1) by redesignating paragraphs (1), (2), and (3) as 
subparagraphs (A), (B), and (C), respectively, and by moving 
such subparagraphs (as so redesignated) 2 ems to the right,
(2) by striking ``For purposes of'' and inserting the 
following:
``(1) In general.--For purposes of'',
(3) by striking ``paragraph (1) or (2)'' in paragraph 
(1)(C) (as so redesignated) and inserting ``subparagraph (A) or 
(B)'', and
(4) by adding at the end the following new paragraph:
``(2) Additional requirements with respect to grantor 
retained annuities.--For purposes of subsection (a), in the 
case of an interest described in paragraph (1)(A) (determined 
without regard to this paragraph) which is retained by the 
transferor, such interest shall be treated as described in such 
paragraph only if--
``(A) the right to receive the fixed amounts 
referred to in such paragraph is for a term of not less 
than 10 years,
``(B) such fixed amounts, when determined on an 
annual basis, do not decrease relative to any prior 
year during the first 10 years of the term referred to 
in subparagraph (A), and
``(C) the remainder interest has a value equal to 
or greater than 10 percent of the value of the assets 
transferred to the trust, determined as of the time of 
the transfer.''.
(b) Effective Date.--The amendments made by this section shall 
apply to transfers made after the date of the enactment of this Act.

SEC. 404. CERTAIN TRANSFER TAX RULES APPLICABLE TO GRANTOR TRUSTS.

(a) In General.--Subtitle B is amended by adding at the end the 
following new chapter:

``CHAPTER 16--SPECIAL RULES FOR GRANTOR TRUSTS

``Sec. 2901. Application of transfer taxes.

``SEC. 2901. APPLICATION OF TRANSFER TAXES.

``(a) In General.--In the case of any portion of a trust to which 
this section applies--
``(1) the value of the gross estate of the deceased deemed 
owner of such portion shall include all assets attributable to 
that portion at the time of the death of such owner,
``(2) any distribution from such portion to one or more 
beneficiaries during the life of the deemed owner of such 
portion shall be treated as a transfer by gift for purposes of 
chapter 12, and
``(3) if at any time during the life of the deemed owner of 
such portion, such owner ceases to be treated as the owner of 
such portion under subpart E of part 1 of subchapter J of 
chapter 1, all assets attributable to such portion at such time 
shall be treated for purposes of chapter 12 as a transfer by 
gift made by the deemed owner.
``(b) Portion of Trust to Which Section Applies.--This section 
shall apply to--
``(1) the portion of a trust with respect to which the 
grantor is the deemed owner, and
``(2) the portion of the trust to which a person who is not 
the grantor is a deemed owner by reason of the rules of subpart 
E of part 1 of subchapter J of chapter 1, and such deemed owner 
engages in a sale, exchange, or comparable transaction with the 
trust that is disregarded for purposes of subtitle A.
For purposes of paragraph (2), the portion of the trust described with 
respect to a transaction is the portion of the trust attributable to 
the property received by the trust in such transaction, including all 
retained income therefrom, appreciation thereon, and reinvestments 
thereof, net of the amount of consideration received by the deemed 
owner in such transaction.
``(c) Exceptions.--This section shall not apply to--
``(1) any trust that is includible in the gross estate of 
the deemed owner (without regard to subsection (a)(1)), and
``(2) any other type of trust that the Secretary determines 
by regulations or other guidance does not have as a significant 
purpose the avoidance of transfer taxes.
``(d) Deemed Owner Defined.--For purposes of this section, the term 
`deemed owner' means any person who is treated as the owner of a 
portion of a trust under subpart E of part 1 of subchapter J of chapter 
1.
``(e) Reduction for Taxable Gifts to Trust Made by Owner.--The 
amount to which subsection (a) applies shall be reduced by the value of 
any transfer by gift by the deemed owner to the trust previously taken 
into account by the deemed owner under chapter 12.
``(f) Liability for Payment of Tax.--Any tax imposed pursuant to 
subsection (a) shall be a liability of the trust.''.
(b) Clerical Amendment.--The table of chapters for subtitle B is 
amended by adding at the end the following new item:

``Chapter 16. Special Rules for Grantor Trusts''.

(c) Effective Date.--The amendments made by this section shall 
apply--
(1) to trusts created on or after the date of the enactment 
of this Act,
(2) to any portion of a trust established before the date 
of the enactment of this Act which is attributable to a 
contribution made on or after such date, and
(3) to any portion of a trust established before the date 
of the enactment of this Act to which section 2901(a) of the 
Internal Revenue Code of 1986 (as added by subsection (a)) 
applies by reason of a transaction described in section 
2901(b)(2) of such Code on or after such date.

SEC. 405. ELIMINATION OF GENERATION-SKIPPING TRANSFER TAX EXEMPTION FOR 
TRANSFERS TO CERTAIN PERSONS.

(a) In General.--Section 2642 is amended by adding at the end the 
following new subsection:
``(h) Elimination of GST Exemption for Transfers to Certain 
Persons.--
``(1) In general.--
``(A) Transfer to non-exempt person.--In the case 
of any direct skip or taxable distribution made to any 
person who is not an exempt person, the inclusion ratio 
shall be 1.
``(B) Taxable termination.--In the case of any 
taxable termination which occurs at any time 
immediately after no exempt person is a beneficiary of 
the trust, the inclusion ratio shall be 1.
``(C) Exempt person.--
``(i) In general.--For purposes of this 
subsection, the term `exempt person' means--
``(I) a natural person--
``(aa) who is assigned to a 
generation which is 2 or fewer 
generations below the 
generation assignment of the 
transferor, or
``(bb) whose date of birth 
precedes the date on which the 
trust was created, or
``(II) a trust in which all 
interests are held by persons described 
in subclause (I).
``(ii) Exception.--For purposes of clause 
(i)(II), any interest which is used primarily 
to postpone or avoid the application of this 
subsection shall be disregarded.
``(2) Date of creation.--
``(A) In general.--For purposes of determining the 
date on which a trust was created under paragraph 
(1)(C)(i)(I)(bb), if the trust was created before 
January 1, 2026, such trust shall be deemed to have 
been created on January 1, 2026.
``(B) Date of creation of pour-over trusts.--
``(i) In general.--In the case of any 
generation-skipping transfer of property which 
involves the transfer of property from one 
trust to another trust, the date of the 
creation of the transferee trust shall be 
treated as being the earlier of--
``(I) the date of the creation of 
such transferee trust, or
``(II) the date of the creation of 
the transferor trust.
``(ii) Multiple transfers.--In the case of 
multiple transfers to which clause (i) 
applies--
``(I) the date of the creation of 
the transferor trust shall be 
determined under such clause, and
``(II) subsequent to the 
determination described in subclause 
(I), the date of the creation of the 
transferee trust shall be determined 
under such clause.
``(3) Generation assignment.--For purposes of this 
subsection, the provisions of section 2653(a) shall not apply.
``(4) Regulations.--The Secretary may prescribe such 
regulations or other guidance as may be necessary or 
appropriate to carry out this subsection.''.
(b) Repeal.--Section 1433(b)(2) of the Tax Reform Act of 1986 
(Public Law 99-514) is repealed.
(c) Effective Dates.--
(1) In general.--The amendment made by subsection (a) shall 
take effect on the date of the enactment of this Act.
(2) Repeal.--The amendment made by subsection (b) shall 
apply to generation-skipping transfers (within the meaning of 
section 2611 of the Internal Revenue Code of 1986) made after 
the date of enactment of this Act.

SEC. 406. SIMPLIFYING GIFT TAX EXCLUSION FOR ANNUAL GIFTS.

(a) In General.--Paragraph (1) of section 2503(b) is amended to 
read as follows:
``(1) In general.--
``(A) Limit per donee.--In the case of gifts made 
to any person by the donor during the calendar year, 
the first $10,000 of such gifts to such person shall 
not, for purposes of subsection (a), be included in the 
total amount of gifts made during such year.
``(B) Cumulative limit per donor.--
``(i) In general.--The aggregate amount 
excluded under subparagraph (A) with respect to 
all transfers described in clause (ii) made by 
the donor during the calendar year shall not 
exceed twice the dollar amount in effect under 
such subparagraph for such calendar year.
``(ii) Transfers subject to limitation.--
The transfers described in this clause are--
``(I) a transfer in trust,
``(II) a transfer of an interest in 
a passthrough entity,
``(III) a transfer of an interest 
subject to a prohibition on sale, and
``(IV) any other transfer of 
property that, without regard to 
withdrawal, put, or other such rights 
in the donee, cannot immediately be 
liquidated by the donee.''.
(b) Conforming Amendment.--Section 2503 is amended by striking 
subsection (c).
(c) Regulations.--The Secretary of the Treasury, or the Secretary 
of the Treasury's delegate, may prescribe such regulations or other 
guidance as may be necessary or appropriate to carry out the amendments 
made by this section.
(d) Effective Date.--The amendments made by this section shall 
apply to any calendar year beginning after the date of the enactment of 
this Act.

SEC. 407. CLARIFICATION REGARDING DISALLOWANCE OF STEP-UP IN BASIS FOR 
PROPERTY HELD IN CERTAIN GRANTOR TRUSTS.

(a) In General.--Section 1014 is amended--
(1) by redesignating subsection (f) as subsection (g), and
(2) by inserting after subsection (e) the following:
``(f) Property Held in Certain Grantor Trusts.--This section shall 
not apply to property--
``(1) held in a trust of which the transferor is considered 
the owner under subpart E of part I of subchapter J, and
``(2) if, after the transfer of such property to the trust, 
such property is not includible in the gross estate of the 
transferor for purposes of chapter 11.''.
(b) Conforming Amendment.--Section 6662(k) is amended by striking 
``1014(f)'' and inserting ``1014(g)''.
(c) Effective Date.--The amendments made by this section shall 
apply to transfers after the date of the enactment of this Act.
(d) No Inference.--No inference may be drawn from the amendments 
made by this section with respect to the application of section 1014 of 
the Internal Revenue Code of 1986 to property described in subsection 
(f) of such section (as added by subsection (a)) which was transferred 
on or before the date of enactment of this Act.

SEC. 408. LIMITATION ON DISCOUNTS; VALUATION RULES FOR CERTAIN 
TRANSFERS OF NONBUSINESS ASSETS.

(a) In General.--Chapter 14 of subtitle B is amended by adding at 
the end the following new section:

``SEC. 2705. LIMITATION ON DISCOUNTS; VALUATION RULES FOR CERTAIN 
TRANSFERS OF NONBUSINESS ASSETS.

``(a) Limitation on Discount by Reason of Family Control.--
``(1) In general.--For purposes of this subtitle, in the 
case of the transfer of any interest in an entity other than an 
interest which is actively traded (within the meaning of 
section 1092), if the transferor, the transferee, and members 
of the family of the transferor and transferee have control of 
such entity immediately before such transfer, no discount shall 
be allowed--
``(A) by reason of the fact that the transferor or 
transferee does not have control of such entity,
``(B) by reason of the lack of marketability of the 
interest, or
``(C) for any other reason.
``(2) Definitions.--In this subsection, the terms `control' 
and `member of the family' have the same meanings given such 
terms in section 2704(c).
``(3) Attribution.--For purposes of this section, the rule 
of section 2701(e)(3) shall apply for purposes of determining 
the interests held by any individual.
``(b) Valuation Rules for Certain Transfers of Nonbusiness 
Assets.--
``(1) In general.--For purposes of this subtitle, in the 
case of the transfer of any interest in an entity other than an 
interest which is actively traded (within the meaning of 
section 1092)--
``(A) the value of any nonbusiness assets held by 
the entity with respect to such interest shall be 
determined as if the transferor had transferred such 
assets directly to the transferee (and no valuation 
discount shall be allowed with respect to such 
nonbusiness assets), and
``(B) such nonbusiness assets shall not be taken 
into account in determining the value of the interest 
in the entity.
``(2) Nonbusiness assets.--For purposes of this 
subsection--
``(A) In general.--The term `nonbusiness asset' 
means any asset other than an asset which is used in 
the active conduct of a trade or business.
``(B) Passive assets treated as nonbusiness 
assets.--
``(i) In general.--For purposes of 
subparagraph (A), a passive asset shall be 
treated as a nonbusiness asset unless--
``(I) the asset is property 
described in paragraph (1) or (4) of 
section 1221(a) or is a hedge with 
respect to such property, or
``(II) the asset is real property 
used in the active conduct of 1 or more 
real property trades or businesses 
(within the meaning of section 
469(c)(7)(C)) in which the transferor 
materially participates and with 
respect to which the transferor meets 
the requirements of section 
469(c)(7)(B)(ii).
``(ii) Material participation.--For 
purposes of clause (i)(II), material 
participation shall be determined under the 
rules of section 469(h), except that section 
469(h)(3) shall be applied without regard to 
the limitation to farming activity.
``(C) Working capital treated as used in trade or 
business.--Any asset (including a passive asset) which 
is held as a part of the reasonably required working 
capital needs of a trade or business shall be treated 
as used in the active conduct of a trade or business.
``(3) Passive asset.--For purposes of this subsection, the 
term `passive asset' means any--
``(A) cash or cash equivalents,
``(B) stock in a corporation or any other equity, 
profits, or capital interest in any entity,
``(C) evidence of indebtedness, option, forward or 
futures contract, notional principal contract, or 
derivative,
``(D) asset described in clause (iii), (iv), or (v) 
of section 351(e)(1)(B),
``(E) annuity,
``(F) real property used in 1 or more real property 
trades or businesses (as defined in section 
469(c)(7)(C)),
``(G) asset (other than a patent, trademark, or 
copyright) which produces royalty income,
``(H) commodity,
``(I) collectible (within the meaning of section 
408(m)), or
``(J) any other asset specified in regulations 
prescribed by the Secretary.
``(4) Look-thru rule.--
``(A) In general.--If a nonbusiness asset of an 
entity described in paragraph (1) consists of a 10-
percent interest in any other entity, this subsection 
shall be applied by disregarding the 10-percent 
interest and by treating the entity as holding directly 
its ratable share of the assets of the other entity.
``(B) 10-percent interest.--The term `10-percent 
interest' means--
``(i) in the case of an interest in a 
corporation, direct ownership of at least 10 
percent (by vote or value) of the stock in such 
corporation,
``(ii) in the case of an interest in a 
partnership, direct ownership of at least 10 
percent of the capital or profits interest in 
the partnership, and
``(iii) in any other case, direct ownership 
of at least 10 percent of the beneficial 
interests in the entity.''.
(b) Conforming Amendments.--
(1) Section 2031(b) of the Internal Revenue Code of 1986 is 
amended by inserting ``(after application of section 2705(b))'' 
after ``shall be determined''.
(2) The table of sections of chapter 14 of subtitle B of 
such Code is amended by adding at the end the following:

``Sec. 2705. Limitation on discounts; valuation rules for certain 
transfers of nonbusiness assets.''.
(c) Effective Date.--The amendments made by this section shall 
apply to transfers after the date of the enactment of this Act.

SEC. 409. SURCHARGE ON HIGH INCOME ESTATES AND TRUSTS.

(a) In General.--Subchapter A of chapter 1 is amended by adding at 
the end the following new part:

``PART VIII--SURCHARGE ON HIGH INCOME ESTATES AND TRUSTS

``Sec. 59B. Surcharge on high income estates and trusts.

``SEC. 59B. SURCHARGE ON HIGH INCOME ESTATES AND TRUSTS.

``(a) General Rule.--In the case of an estate or trust, there is 
hereby imposed (in addition to any other tax imposed by this subtitle) 
a tax equal to the sum of--
``(1) 5 percent of so much of the modified adjusted gross 
income of the taxpayer as exceeds $200,000, plus
``(2) 3 percent of so much of the modified adjusted gross 
income of the taxpayer as exceeds $500,000.
``(b) Modified Adjusted Gross Income.--For purposes of this 
section--
``(1) In general.--The term `modified adjusted gross 
income' means adjusted gross income reduced by any deduction 
(not taken into account in determining adjusted gross income) 
allowed for investment interest (as defined in section 163(d)) 
or business interest (as defined in section 163(j)).
``(2) Adjusted gross income.--Adjusted gross income shall 
be determined as provided in section 67(e) and reduced by the 
amount allowed as a deduction under section 642(c).
``(c) Special Rules.--
``(1) Charitable trusts.--Subsection (a) shall not apply to 
a trust all the unexpired interests in which are devoted to one 
or more of the purposes described in section 170(c)(2)(B).
``(2) Not treated as tax imposed by this chapter for 
certain purposes.--The tax imposed under this section shall not 
be treated as tax imposed by this chapter for purposes of 
determining the amount of any credit under this chapter (other 
than sections 27 and 901) or for purposes of section 55.
``(3) Electing small business trusts.--For purposes of the 
determination of adjusted gross income, section 641(c)(1)(A) 
shall not apply and all portions of any electing small business 
trust shall be treated as a single trust.
``(d) Regulations.--The Secretary shall issue such regulations or 
other guidance as may be necessary or appropriate to carry out the 
purposes of this section, including regulations or other guidance to 
prevent the avoidance of the purposes of this section.''.
(b) Coordination With Certain Provisions.--
(1) Interest on certain deferred tax liability.--Section 
453A(c) is amended by redesignating paragraph (6) as paragraph 
(7) and by inserting after paragraph (5) the following new 
paragraph:
``(6) Surcharge on high income estates and trusts taken 
into account in determining maximum rate of tax.--For purposes 
of paragraph (3)(B), in the case of an estate or trust, the 
maximum rate of tax in effect under section 1 shall be treated 
as being equal to the sum of such rate and the rates in effect 
under paragraphs (1) and (2) of section 59B(a).''.
(2) Limitation on foreign tax credit.--
(A) Section 904(b)(3)(E)(i)(I) is amended by 
inserting ``increased, in the case of an estate or 
trust, by the sum of the rates set forth in paragraphs 
(1) and (2) of section 1A(a)'' after ``(whichever 
applies)''.
(B) Section 904(d)(2)(F) is amended by adding at 
the end the following: ``For purposes of the first 
sentence of this subparagraph, in the case of an estate 
or trust, the highest rate of tax specified in section 
1 shall be treated as being equal to the sum of such 
rate and the rates in effect under paragraphs (1) and 
(2) of section 59B(a).''.
(3) Election by individuals to be subject to tax at 
corporate rates.--Section 962(a)(1) is amended by striking 
``and 55'' and inserting 55``, and 59B''.
(4) Interest on certain tax deferral.--Section 1291(c)(2) 
is amended by adding at the end the following: ``For purposes 
of the preceding sentence, in the case of an estate or trust, 
the highest rate of tax in effect under section 1 shall be 
treated as being equal to the sum of such rate and the rates in 
effect under paragraphs (1) and (2) of section 59B(a).''.
(5) Withholding of tax on foreign partners' share of 
effectively connected income.--Section 1446(b)(2) is amended by 
adding at the end the following flush sentence:
``For purposes of subparagraph (A), in the case of a partner 
which is an estate or trust, the highest rate of tax in effect 
under section 1 shall be treated as being equal to the sum of 
such rate and the rates in effect under paragraphs (1) and (2) 
of section 59B(a).''.
(6) Partnership adjustments.--
(A) Section 6225(b)(1) is amended by adding at the 
end the following flush sentence:
``For purposes of subparagraph (B), in the case of an estate or 
trust, the highest rate of tax in effect under section 1 shall 
be treated as being equal to the sum of such rate and the rates 
in effect under paragraphs (1) and (2) of section 59B(a).''.
(B) Section 6225(c)(4)(A) is amended--
(i) by striking ``subsection (b)(1)(A)'' 
and inserting ``subsection (b)(1)(B)'', and
(ii) by striking ``or'' at the end of 
clause (i), by adding ``or'' at the end of 
clause (ii), and by inserting after clause (ii) 
the following new clause:
``(iii) is not an estate or trust subject 
to one or both of the rates of tax in effect 
under paragraphs (1) and (2) of section 
59B(a),''.
(7) Required payments for entities electing not to have 
required taxable year.--The second sentence of section 7519(b) 
is amended by inserting ``and, in the case of an estate or 
trust, increased by the sum of the rates in effect under 
paragraphs (1) and (2) of section 59B(a)'' before the period at 
the end.
(c) Clerical Amendment.--The table of parts for subchapter A of 
chapter 1 is amended by adding at the end the following new item:

``PART VIII--Surcharge on High Income Estates and Trusts''.

(d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 410. MODIFICATION OF RULES FOR VALUE OF CERTAIN FARM, ETC., REAL 
PROPERTY.

(a) In General.--Paragraph (2) of section 2032A(a) of the Internal 
Revenue Code of 1986 is amended by striking ``$750,000'' and inserting 
``$3,000,000''.
(b) Inflation Adjustment.--Paragraph (3) of section 2032A(a) of 
such Code is amended--
(1) by striking ``1998'' and inserting ``2026'',
(2) by striking ``$750,000'' each place it appears and 
inserting ``$3,000,000'', and
(3) by striking ``calendar year 1997'' and inserting 
``calendar year 2025'' in subparagraph (B).
(c) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and gifts made, after December 31, 
2025.

SEC. 411. MODIFICATION OF ESTATE TAX RULES WITH RESPECT TO LAND SUBJECT 
TO CONSERVATION EASEMENTS.

(a) Modification of Exclusion Limitation.--Subparagraph (B) of 
section 2031(c)(1) of the Internal Revenue Code of 1986 is amended by 
striking ``$500,000'' and inserting ``$2,000,000''.
(b) Modification of Applicable Percentage.--Paragraph (2) of 
section 2031(c) of the Internal Revenue Code of 1986 is amended by 
striking ``40 percent'' and inserting ``60 percent''.
(c) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and gifts made, after December 31, 
2025.

TITLE V--ACCESSIBILITY REQUIREMENTS

SEC. 501. ACCESSIBILITY REQUIREMENTS.

In the case of housing that is constructed, altered, or otherwise 
assisted using amounts made available to the Secretary of Housing and 
Urban Development under this Act or an amendment made by this Act, 
sections 8.22 and 8.23 of title 24, Code of Federal Regulations (or any 
successor regulations) shall be applied such that the number of 
dwelling units required to be accessible under those sections is twice 
the number that would otherwise be required to be accessible under 
those sections.
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