S. 4262

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4262 Introduced in Senate (IS)]

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119th CONGRESS
2d Session
S. 4262

To promote shared equity models of homeownership, and for other 
purposes.

_______________________________________________________________________

IN THE SENATE OF THE UNITED STATES

March 26, 2026

Ms. Blunt Rochester introduced the following bill; which was read twice 
and referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

A BILL

To promote shared equity models of homeownership, 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.

This Act may be cited as the ``Permanent Housing Affordability 
Act''.

SEC. 2. DEFINITIONS.

In this Act:
(1) Community development financial institution.--The term 
``community development financial institution'' has the meaning 
given the term in section 103 of the Community Development 
Banking and Financial Institutions Act of 1994 (12 U.S.C. 
4702).
(2) Community land trust.--The term ``community land 
trust'' means a nonprofit entity, a State, a unit of local 
government, or an instrumentality of a State or unit of local 
government--
(A) that is not managed by, or an affiliate of, a 
for-profit organization;
(B) the primary purpose of which is acquiring, 
developing, or holding land to provide housing that is 
permanently affordable to low- and moderate-income 
persons;
(C) that monitors properties to ensure 
affordability is preserved;
(D) that provides housing that is permanently 
affordable to low- and moderate-income persons using a 
ground lease, deed covenant, or other similar legally 
enforceable measure, determined acceptable by the 
Secretary, that--
(i) keeps the housing affordable to low- 
and moderate-income persons for not less than--
(I) 99 years; or
(II) the greatest minimum 
affordability period permitted by 
applicable State law, if that law 
restricts minimum affordability periods 
to a number of years that is less than 
99; and
(ii) enables low- and moderate-income 
persons to rent or purchase the housing for 
homeownership; and
(E) that maintains preemptive purchase options to 
purchase the property, if such purchase would allow the 
housing to remain affordable to low- and moderate-
income persons.
(3) Eligible entity.--The term ``eligible entity'' means a 
unit of local government, an instrumentality of a State or unit 
of local government, or a nonprofit organization, including a 
community land trust, that manages a shared equity 
homeownership model program.
(4) Eligible grantee.--The term ``eligible grantee'' 
means--
(A) any agency of a State;
(B) any authority chartered by a State to help meet 
affordable housing needs of the residents of the State; 
and
(C) a community development financial institution 
that is certified by the Secretary of the Treasury.
(5) Qualified homebuyer.--The term ``qualified homebuyer'' 
means a homebuyer with a household income that is not more than 
120 percent of the area median income.
(6) Resale formula.--The term ``resale formula'' means a 
permissible method of determining fair return and resale price 
under section 92.254(a)(5)(i)(A) of title 24, Code of Federal 
Regulations, as in effect on March 28, 2025.
(7) Shared equity homeownership model.--The term ``shared 
equity homeownership model'' means a model of resale-
restricted, owner-occupied housing the primary purpose of which 
is to create and preserve a supply of owner-occupied units 
affordable to low and moderate income households that--
(A) carry terms of affordability that are not less 
than--
(i) 99 years; or
(ii) the greatest minimum affordability 
period permitted by applicable State law, if 
that law restricts minimum affordability 
periods to a number of years that is less than 
99; and
(B) restrict the resale value of properties in the 
program according to a resale formula described in a 
ground lease, deed restriction, or similar legal 
mechanism.

SEC. 3. LASTING HOME AFFORDABILITY FUND.

(a) In General.--Not later than 90 days after the date of enactment 
of this Act, the Secretary of the Treasury (in this section referred to 
as the ``Secretary'') shall establish a program to provide grants to 
eligible grantees to use for the purpose of providing low-interest 
construction loans to eligible entities.
(b) Application by Eligible Grantees.--To be eligible to receive 
amounts under this section, an eligible grantee shall submit an 
application at such time and in such manner as the Secretary may 
reasonably require, including a detailed description of--
(1) how the eligible grantee intends to use any amounts 
provided under this section; and
(2) the qualifications such eligible grantee has that will 
allow such eligible grantee to successfully administer a grant 
under this section.
(c) Use of Amounts by Eligible Grantees.--
(1) In general.--Any eligible grantee that receives amounts 
under this section shall use such amounts and related proceeds 
to establish a revolving fund and provide low-interest 
construction loans to 1 or more eligible entities, which 
amounts may be awarded to eligible entities on a rolling basis.
(2) Loan requirements.--
(A) In general.--Loans provided by an eligible 
grantee to an eligible entity using amounts provided 
under this section shall--
(i) have an interest rate of not more than 
3 percent; and
(ii) have an origination fee of not more 
than 1 percent of the amount of the loan.
(B) Liquidity requirements.--An eligible grantee 
may not require, as a condition of receiving a loan 
under this section, that an eligible entity has more 
than 10 percent of the amount to be loaned in liquid 
assets at the time of the loan.
(3) Limitation.--An eligible entity that receives amounts 
under this section may not be the same entity as the eligible 
grantee that provides those amounts.
(4) Priority.--An eligible grantee shall prioritize loans 
to eligible entities that plan to use amounts loaned under this 
section to construct or rehabilitate properties--
(A) located in areas with high cost burden, as 
determined by the Secretary, individuals at risk of 
displacement due to rising housing costs, or redlining; 
or
(B) that are required to be affordable as described 
in subsection (e) for terms that are more than 99 
years.
(d) Use of Amounts by Eligible Entities.--An eligible entity may 
use amounts loaned by an eligible grantee for costs associated with the 
construction or rehabilitation of housing intended to be sold to a 
homebuyer, a member of a limited equity cooperative, or a community 
land trust and used as a primary residence, including materials, labor 
(including contractor fees), land development (including demolition and 
grading), permit and developer fees, insurance costs, on-site 
infrastructure costs (including the installation of roads, water, 
electrical, sewer, storm drainage, and sidewalks), and predevelopment 
(including architectural costs and engineering costs).
(e) Affordability Requirement.--An eligible entity that uses 
amounts loaned under this section to construct or rehabilitate a 
property--
(1) may only sell or facilitate the sale of such property 
to qualified homebuyers; and
(2) shall ensure any subsequent sales are to qualified 
homebuyers at a below-market value that is determined by a 
resale formula described in a ground lease, deed restriction, 
or other similar mechanism.
(f) Areas of Service.--The Secretary shall seek to provide grants 
to eligible grantees that will fund activities in geographically 
diverse areas, including areas of persistent poverty, underserved 
areas, and rural areas.
(g) Rulemaking.--The Secretary may issue rules to carry out this 
section.
(h) Reporting.--
(1) Grantee reports.--The Secretary shall require each 
grantee receiving grant amounts in any given year under this 
section to submit a report, for such year and each year that 
loans are made using grant funds, to the Secretary that 
includes--
(A) the number of qualifying loans made;
(B) the organizations receiving loans;
(C) the number of outstanding loans on September 
30th of the report year;
(D) the percentage of organizations belonging to 
each type of eligible grantee as described in 
subparagraphs (A) through (C) of section 2(4);
(E) the projected number of units constructed or 
rehabilitated by each loan;
(F) the average interest rate on qualifying loans;
(G) the average origination fee on qualifying 
loans;
(H) the median purchase price of the homes 
constructed or rehabilitated by each loan compared to 
the median market rate price in the area;
(I) the zip codes where the homes constructed or 
rehabilitated by each loan are located;
(J) the area median income level of households 
assisted;
(K) the percentage and number of loans made for the 
purpose of construction;
(L) the percentage and number of loans make for the 
purpose of rehabilitation;
(M) a description of any mechanism used to ensure 
permanent affordability by each grantee, such as ground 
leases, deed restrictions, covenants, or other 
mechanisms;
(N) the resale formula used by each eligible entity 
that receives a loan from the grantee; and
(O) where applicable, for each loan made, the 
percentage of total project cost expected to be covered 
by the loan.
(2) Report to congress.--Not later than 90 days after the 
conclusion of each fiscal year in which assistance under this 
section is made available, the Secretary shall 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 on amounts provided under this section 
that contains, with aggregates, averages, and summaries, as 
appropriate, information provided by grantees under paragraph 
(1).
(i) Authorization of Appropriations.--There is authorized to be 
appropriated to the Secretary $100,000,000 for fiscal year 2027 to 
carry out this section, to remain available until expended.

SEC. 4. LASTING AFFORDABILITY HOMEOWNERSHIP GRANT PILOT PROGRAM.

(a) In General.--The Secretary of Housing and Urban Development (in 
this section referred to as the ``Secretary'') shall establish a pilot 
program to provide grants to eligible entities.
(b) Use of Amounts.--Each eligible entity that receives amounts 
under this section shall use such amounts to--
(1) purchase vacant land to develop housing and sell that 
housing to homebuyers or members of a limited equity 
cooperative; and
(2) purchase existing properties or predeveloped land on 
which properties will be developed that will be sold to 
homebuyers or members of a limited equity cooperative.
(c) Priority.--The Secretary shall prioritize the award of grants 
to eligible entities that will maintain affordability for the homes 
sold by the eligible entity for the longest term.
(d) Requirements.--
(1) Vacant land.--In the case of vacant land purchased by 
an eligible entity under this section, the housing shall be 
built and marketed for sale not later than 3 years after the 
date of the purchase, which period may be extended at the 
discretion of the Secretary for extenuating circumstances, such 
as delays in the development process, provided that the 
Secretary makes public a list of localities where such 
extenuating circumstances are occurring.
(2) Existing land or properties.--In the case of existing 
properties or predeveloped land purchased by an eligible entity 
under this section, the homes shall be ready for sale to 
homebuyers not later than 3 years after the date of the 
purchase, which period may be extended at the discretion of the 
Secretary for extenuating circumstances.
(3) All properties.--Each home developed with amounts 
provided under this section shall be sold to households--
(A) with an income that is less than or equal to--
(i) 80 percent of the area median income; 
or
(ii) 120 percent of the area median income, 
if the home is located in a rural area;
(B) with ground leases, deed restrictions, 
covenants, or other mechanisms to ensure permanent 
affordability; and
(C) according to a resale formula determined by the 
eligible entity.
(e) Reporting.--
(1) Eligible entity reports.--Not later than 2 years after 
receiving a grant under this section, and biennially for 6 
years thereafter, an eligible entity shall submit to the 
Secretary a streamlined report that includes--
(A) as applicable, the number of acres purchased;
(B) as applicable, the number of units purchased;
(C) as applicable, the number of buildings and 
units developed;
(D) as applicable, the number of buildings and 
units renovated;
(E) a description of the ground leases, deed 
restrictions, covenants, or other mechanisms used to 
ensure permanent affordability;
(F) a description of the resale formula used;
(G) the number of households served;
(H) the average size of units;
(I) the median purchase price;
(J) to the extent possible, the average amount of 
the down payment paid by households;
(K) the average tenure of residents;
(L) to the extent possible, the average credit 
score of purchasers;
(M) the average delinquency and foreclosure rate; 
and
(N) the average annual resident fees.
(2) Report to congress.--Not later than 90 days after the 
conclusion of each fiscal year in which assistance under this 
section is made available, the Secretary shall 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 on this section that contains, with 
aggregates, averages, and summaries, as appropriate, 
information provided by eligible entities under paragraph (1).
(f) Authorization of Appropriations.--
(1) In general.--There is authorized to be appropriated to 
the Secretary $100,000,000 for each of fiscal years 2027 
through 2031 to carry out this section.
(2) Technical assistance.--Not more than 10 percent of 
amounts appropriated under paragraph (1) may be used to provide 
technical assistance to eligible entities that receive a grant 
under this section.

SEC. 5. SHARED EQUITY HOUSING RESEARCH AND AWARENESS PROGRAMS.

(a) Housing Research.--
(1) In general.--The Secretary of Housing and Urban 
Development (in this section referred to as the ``Secretary''), 
acting through the Office of Policy Development and Research, 
shall establish a program that conducts, supports, and 
disseminates research about best practices for community land 
trusts and other shared equity homeownership models, including 
best practices regarding ground leases, deed restrictions, or 
other legal mechanisms for preserving long-term affordability.
(2) Awards.--For States, local governments, Tribal 
governments, and entities managing shared equity homeownership 
models, including nonprofit organizations, the Secretary shall 
provide funding to organizations representing nonprofit shared 
equity model interests to create or sustain shared equity 
homeownership models through technical assistance and capacity 
building.
(3) Authorization of appropriations.--There is authorized 
to be appropriated to the Secretary such sums as may be 
necessary to carry out this subsection.
(b) Public Awareness.--
(1) In general.--Not later than 1 year after the date of 
enactment of this Act, the Secretary shall conduct a public 
awareness campaign to educate the public and the financial 
sector about the benefits and responsibilities of shared equity 
homeownership models, including community land trusts, which 
may include--
(A) creating a web page to publicize shared equity 
homeownership models;
(B) disseminating information to housing counseling 
agencies or other entities to provide information to 
potential homebuyers;
(C) providing information to lenders about the 
shared equity homeownership model, including standard 
ground leases and appraisal guidance developed by the 
Federal National Mortgage Association and the Federal 
Home Loan Mortgage Corporation; and
(D) to the extent possible, work with States, local 
governments, Tribal governments, and entities managing 
shared equity homeownership models, including nonprofit 
organizations, to advance public awareness.
(2) Authorization of appropriations.--There is authorized 
to be appropriated to the Secretary $3,000,000 for each of 
fiscal years 2027 through 2029 to carry out this subsection.
(c) Outreach.--
(1) In general.--The Secretary, in consultation and 
coordination with other appropriate entities, including the 
Federal Housing Finance Agency, shall carry out an education 
and outreach campaign to inform and educate consumers, home 
builders, residential lenders, and other real estate 
professionals on the availability, benefits, and advantages of 
community land trusts and other shared equity homeownership 
models.
(2) Authorization of appropriations.--There is authorized 
to be appropriated to the Secretary such sums as may be 
necessary to carry out this subsection.
(d) Report.--Not later than 90 days after the conclusion of each 
fiscal year in which assistance under this section is made available, 
the Secretary shall 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 on the shared equity housing 
research and awareness programs described in this section that 
includes, for the period covered by the report--
(1) a description of public awareness and public outreach 
campaigns conducted by the Secretary;
(2) a description of consultation and coordination efforts 
with the Federal Housing Finance Agency, including a 
description of Federal Housing Finance Agency activities to 
improve mortgage lender education and outreach that resulted 
from consultation and coordination efforts;
(3) a description of the research conducted on best 
practices for community land trusts and other shared equity 
homeownership models; and
(4) the number and location of entities that received 
technical assistance and capacity building on community land 
trusts and other shared equity homeownership models.

SEC. 6. SURPLUS LAND.

(a) In General.--Section 550 of title 40, United States Code, is 
amended--
(1) in subsection (a)--
(A) in the subsection heading, by striking 
``Definition'' and inserting ``Definitions''; and
(B) by striking ``section, the term'' and inserting 
``section--
``(1) the term `shared equity homeownership model' has the 
meaning given the term in section 2 of the Permanent Housing 
Affordability Act; and'';
(2) in subsection (b)(2)(D), by inserting ``and for 
property transferred under subsection (i) to a community land 
trust or other shared equity homeownership model'' after 
``families''; and
(3) by adding at the end the following:
``(i) Property for Community Land Trust or Other Shared Equity 
Homeownership Model.--
``(1) Conveyance.--The Administrator may convey to a 
community land trust or other shared equity homeownership model 
the right, title, and interest of the Government in and to any 
surplus real property that the Secretary of Housing and Urban 
Development determines is suitable for a community land trust 
or other shared equity homeownership model.
``(2) Deed of conveyance.--The deed of conveyance of any 
surplus real property disposed of under this subsection--
``(A) shall provide that all of the property be 
used and maintained for purposes of a community land 
trust or other shared equity homeownership model in 
perpetuity, and that if the property ceases to be used 
or maintained in a community land trust or other shared 
equity homeownership model, all or any portion of the 
property shall, in its then existing condition, at the 
option of the Government, revert to the Government; and
``(B) may contain additional terms, reservations, 
restrictions, and conditions the Administrator 
determines are necessary to safeguard the interests of 
the Government.
``(3) Fixing value.--
``(A) In general.--In fixing the sale or lease 
value of property disposed of under paragraph (2), the 
Secretary of Housing and Urban Development shall take 
into consideration and discount the value for any 
benefit which has accrued or may accrue to the 
Government from the use of the property by the 
community land trust or other shared equity 
homeownership model.
``(B) Amount of discount.--The amount of the 
discount under subparagraph (A) is 75 percent of the 
market value of the property, except that the Secretary 
of Housing and Urban Development may discount by a 
greater percentage if the Secretary, in consultation 
with the Administrator, determines that a higher 
percentage is justified.''.
(b) Report.--Not later than 90 days after the conclusion of each 
fiscal year in which assistance under section 550(i) of title 40, 
United States Code, as added by subsection (a), is made available, the 
Secretary of Housing and Urban Development shall 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 on surplus land that includes--
(1) the number of surplus real properties conveyed by the 
Federal Government for the purpose of affordable housing, 
including such properties that were conveyed to a community 
land trust or other shared equity homeownership model; and
(2) the average discounted value of real property conveyed 
by the Federal Government for the purpose of affordable 
housing, including such real property that was conveyed to a 
community land trust or other shared equity homeownership 
model.
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