NONPROFIT SET-ASIDE.

SEC. 708. NONPROFIT SET-ASIDE. (a) In General.—Section 515(w) of the Housing Act of 1949 (42 U.S.C. 1485(w)) is amended— (1) in paragraph (1), by striking “not less than 7 percent of the amounts available in fiscal year 1991 and not less than 9 percent of the amounts available in fiscal year 1992” and inserting “not less than 9 percent of the amounts available in fiscal years 1993 and 1994”; (2) in paragraph (1), in the second sentence by striking “or under whole or partial control with a for-profit entity”; (3) in paragraph (1), by adding at the end the following new sentence: “partnership, that has as its general partner a nonprofit entity or the nonprofit entity’s for-profit subsidiary, is eligible to receive funds set aside under this subsection to sponsor a project which is receiving low-income housing tax credits authorized under section 42 of the Internal Revenue Code of 1986, For the purposes of this subsection, a nonprofit entity is an organization that— “(A) will own an interest in a project to be financed under this section and will materially participate in the development and the operation of the project; “(B) is a private organization that has nonprofit, tax exempt status under section 501(c)(3) or section 501(c)(4) of the Internal Revenue Code of 1986: “(C) has among its purposes the planning, development, or management of low-income housing or community development projects; and “(D) is not affiliated with or controlled by a for-profit organization.”; (4) in paragraph (2), by adding at the end the following: “The Secretary may provide amounts available for reallocation under this subsection in excess of $750,000 in a given State, if such amounts are necessary to finance a project under this section”; and (5) by striking paragraph (3) and inserting the following: “(3) Unused amounts.— “(A) Equitable distribution.—Any amounts set aside under this subsection from the allocation for any State that are not obligated by 9 months after the allocation, shall first be pooled and made available to any other eligible nonprofit entity in any State as defined in this 106 STAT. 3840subsection. The Secretary shall make reasonable efforts to ensure that pooled funds are distributed under this subparagraph in an equitable manner. “(B) Return to the states.—After funds have been pooled and obligated for 30 days, the Secretary shall return any remaining funds to the States on a proportional basis for use by any other eligible entity as defined in this section.”. (b) Effective Date.—The amendment made by subsection (a)(5) shall take effect on October 1, 1993, and shall apply to fiscal year 1994 and each fiscal year thereafter.