ENHANCED-USE LEASES AND SPECIAL DISPOSITION OF PROPERTY.

SEC. 401. ENHANCED-USE LEASES AND SPECIAL DISPOSITION OF PROPERTY. (a) Amendment to Chapter 81.— Chapter 81 is amended by adding at the end the following new subchapter: “SUBCHAPTER V— ENHANCED-USE LEASES OF REAL PROPERTY “§ 8161. Definitions “For the purposes of this subchapter: “(1) The term ‘enhanced-use lease’ means a written lease entered into by the Secretary under this subchapter. “(2) The term ‘congressional veterans’ affairs committees’ means the Committees on Veterans’ Affairs of the Senate and the House of Representatives. “§ 8162. Enhanced-use leases “(a) (1) The Secretary may in accordance with this subchapter enter into leases with respect to real property that is under the jurisdiction or control of the Secretary. Any such lease under this subchapter may be referred to as an ‘enhanced-use lease’. The Secretary may dispose of any such property that is leased to another party under this subchapter in accordance with section 8164 of this title. The Secretary may exercise the authority provided by this subchapter notwithstanding section 8122 of this title, section 321 of the Act of June 30, 1932 (40 U.S.C. 303b), sections 202 and 203 of the105 STAT. 418 Federal Property and Administrative Services Act of 1949 (40 U.S.C. 483, 484), or any other provision of law (other than Federal laws relating to environmental and historic preservation) inconsistent with this section. The applicability of this subchapter to section 421(b) of the Veterans’ Benefits and Services Act of 1988 (Public Law 100–322; 102 Stat. 553) is covered by subsection (c). “(2) The Secretary may enter into an enhanced-use lease only if the Secretary determines that— “(A) at least part of the use of the property under the lease will be to provide appropriate space for an activity contributing to the mission of the Department; “(B) the lease will not be inconsistent with and will not adversely affect the mission of the Department; and “(C) the lease will enhance the use of the property. “(3) The provisions of the Act of March 3, 1931 (40 U.S.C. 276a et seq.), shall not, by reason of this section, become inapplicable to property that is leased to another party under an enhanced-use lease. “(4) A property that is leased to another party under an enhanced-use lease may not be considered to be unutilized or underutilized for purposes of section 501 of the Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11411). “(b) (1) If the Secretary has determined that a property should be leased to another party through an enhanced-use lease, the Secretary shall select the party with whom the lease will be entered into using selection procedures determined by the Secretary that ensure the integrity of the selection process. “(2) The term of an enhanced-use lease may not exceed— “(A) 35 years, in the case of a lease involving the construction of a new building or the substantial rehabilitation of an existing building, as determined by the Secretary; or “(B) 20 years, in the case of a lease not described in subparagraph (A). “(3) (A) Each enhanced-use lease shall be for fair consideration, as determined by the Secretary. Consideration under such a lease may be provided in whole or in part through consideration in-kind. “(B) Consideration in-kind may include provision of goods or services of benefit to the Department, including construction, repair, remodeling, or other physical improvements of Department facilities, maintenance of Department facilities, or the provision of office, storage, or other usable space. “(4) Any payment by the Secretary for the use of space or services by the Department on property that has been leased under this subchapter may only be made from funds appropriated to the Department for the activity that uses the space or services. No other such payment may be made by the Secretary to a lessee under an enhanced-use lease unless the authority to make the payment is provided in advance in an appropriation Act. “(c) (1) Subject to paragraph (2), the entering into an enhanced-use lease covering any land or improvement described in section 421(b)(2) of the Veterans’ Benefits and Services Act of 1988 (Public Law 100–322; 102 Stat. 553) shall be considered to be prohibited by that section unless specifically authorized by law. “(2) The entering into an enhanced-use lease by the Secretary covering any land or improvement described in such section 421(b)(2) shall not be considered to be prohibited under that section if under the lease— 105 STAT. 419 “(A) the designated property is to be used only for child-care services; “(B) those services are to be provided only for the benefit of— “(i) employees of the Department; “(ii) individuals employed on the premises of such property; and (iii) employees of a health-personnel educational institution that is affiliated with a Department facility; “(C) over one-half of the employees benefited by the child-care services provided are required to be employees of the Department; and “(D) over one-half of the children to whom child-care services are provided are required to be children of employees of the Department. “§ 8163. Designation of property to be leased “(a) If the Secretary proposes to designate a property to be leased under an enhanced-use lease, the Secretary shall conduct a public hearing before making the designation. The hearing shall be conducted in the community in which the property is located. At the hearing, the Secretary shall receive the views of veterans service organizations and other interested parties regarding the proposed lease of the property and the possible effects of the uses to be made of the property under a lease of the general character then contemplated. The possible effects to be addressed at the hearing shall include effects on— “(1) local commerce and other aspects of the local community; “(2) programs administered by the Department; and “(3) services to veterans in the community. “(b) Before conducting such a hearing, the Secretary shall provide reasonable notice of the proposed designation and of the hearing. The notice shall include— “(1) the time and place of the hearing; “(2) identification of the property proposed to be leased; “(3) a description of the proposed uses of the property under the lease; “(4) a description of how the uses to be made of the property under a lease of the general character then contemplated— “(A) would contribute in a cost-effective manner to the mission of the Department; “(B) would not be inconsistent with the mission of the Department; and “(C) would not adversely affect the mission of the Department; and “(5) a description of how those uses would affect services to veterans. “(c) (1) If after a hearing under subsection (a) the Secretary intends to designate the property involved, the Secretary shall notify the veterans’ affairs committees of the Secretary s intention to so designate the property and shall publish a notice of such intention in the Federal Register. “(2) The Secretary may not enter into an enhanced-use lease until the end of a 60-day period of continuous session of Congress following the date of the submission of notice under paragraph (1). For purposes of the preceding sentence, continuity of a session of Congress is broken only by an adjournment sine die, and there shall be excluded from the computation of such 60-day period any day during105 STAT. 420 which either House of Congress is not in session during an adjournment of more than three days to a day certain. “(3) Each notice under paragraph (1) shall include the following: “(A) An identification of the property involved. “(B) An explanation of the background of, rationale for, and economic factors in support of, the proposed lease. “(C) A summary of the views expressed by interested parties at the public hearing conducted in connection with the proposed designation, together with a summary of the Secretary’s evaluation of those views. “(D) A general description of the proposed lease. “(E) A description of how the proposed lease— “(i) would contribute in a cost-effective manner to the mission of the Department; “(ii) would not be inconsistent with the mission of the Department; and “(iii) would not adversely affect the mission of the Department. “(F) A description of how the proposed lease would affect services to veterans. “(4) Not less than 30 days before entering into an enhanced-use lease, the Secretary shall submit to the congressional veterans’ affairs committees a report on the proposed lease. The report shall include— “(A) updated information with respect to the matters described in paragraph (3); “(B) a summary of a cost-benefit analysis of the proposed lease; “(C) a description of the provisions of the proposed lease; and “(D) a notice of designation with respect to the property. “§ 8164. Authority for disposition of leased property “(a) If, during the term of an enhanced-use lease or within 30 days after the end of the term of the lease, the Secretary determines that the leased property is no longer needed by the Department, the Secretary may initiate action for the transfer to the lessee of all right, title, and interest of the United States in the property by requesting the Administrator of General Services to dispose of the property pursuant to subsection (b). A disposition of property may not be made under this section unless the Secretary determines that the disposition under this section rather than under section 8122 of this title is in the best interests of the Department. The Administrator, upon request of the Secretary, shall take appropriate action under this section to dispose of property of the Department that is or has been subject to an enhanced-use lease. “(b) A disposition under this section may be made for such consideration as the Secretary and the Administrator of General Services jointly determine is in the best interest of the United States and upon such other terms and conditions as the Secretary and the Administrator consider appropriate. “(c) Not less than 90 days before a disposition of property is made under this section, the Secretary shall notify the congressional veterans’ affairs committees of the Secretary’s intent to dispose of the property and shall publish notice of the proposed disposition in the Federal Register, The notice shall describe the background of, rationale for, and economic factors in support of, the proposed105 STAT. 421 disposition (including a cost-benefit analysis summary) and the method, terms, and conditions of the proposed disposition. “§ 8165. Use of proceeds “(a) (1) Of the funds received by the Department under an enhanced-use lease and remaining after any deduction from such funds under subsection (b), 75 percent shall be deposited in the nursing home revolving fund established under section 8116 of this title and 25 percent shall be credited to the Medical Care Account of the Department for the use of the Department facility at which the property is located. “(2) Funds received by the Department from a disposal of leased property under section 8164 of this title and remaining after any deduction from such funds under the laws referred to in subsection (c) shall be deposited in the nursing home revolving fund. “(b) An amount sufficient to pay for any expenses incurred by the Secretary in any fiscal year in connection with an enhanced-use lease shall be deducted from the proceeds of the lease for that fiscal year and may be used by the Secretary to reimburse the account from which the funds were used to pay such expenses. “(c) Subsection (a) does not affect the applicability of section 204 of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 485) or the Act of June 8, 1896 (40 U.S.C. 485a), with respect to reimbursement of the Administrator of General Services for expenses arising from any disposal of property under section 8164 of this title. “§ 8166. Construction standards “(a) Unless the Secretary provides otherwise, the construction, alteration, repair, remodeling, or improvement of the property that is the subject of the lease shall be carried out so as to comply with all standards applicable to construction of Federal buildings. Any such construction, alteration, repair, remodeling, or improvement shall not be subject to any State or local law relating to building codes, permits, or inspections unless the Secretary provides otherwise. “(b) Unless the Secretary has provided that Federal construction standards are not applicable to a property, the Secretary shall conduct periodic inspections of any such construction, alteration, repair, remodeling, or improvement for the purpose of ensuring that the standards are met. “§ 8167. Exemption from State and local taxes “The interest of the United States in any property subject to an enhanced-use lease and any use by the United States of such property during such lease shall not be subject, directly or indirectly, to any State or local law relative to taxation, fees, assessments, or special assessments, except sales taxes charged in connection with any construction, alteration, repair, remodeling, or improvement project carried out under the lease. “§ 8168. Limitation on number of agreements “(a) Not more than 20 enhanced-use leases may be entered into under this subchapter, and not more than 10 such leases may be entered into during any fiscal year. “(b) An enhanced-use lease under which the primary use made of the leased premises is the provision of child-care services for employ-105 STAT. 422ees of the Department shall not be counted for the purposes of subsection (a). “§ 8169. Expiration “The authority of the Secretary to enter into enhanced-use leases under this subchapter expires on December 31, 1994.”. (b) Clerical Amendments.— (1) The heading for chapter 81 is amended by adding at the end the following: “; LEASES OF REAL PROPERTY”. (2) The items relating to chapter 81 in the tables of chapters before part I and at the beginning of part VI are amended to read as follows: “81. Acquisition and Operation of Hospital and Domiciliary Facilities; Procurement and Supply; Enhanced-Use Leases of Real Property 8101”. (3) The table of sections at the beginning of chapter 81 is amended by adding at the end the following: “SUBCHAPTER V—ENHANCKD-USE LEASES OF REAL PROPERTY “8161. Definitions. “8162. Enhanced-use leases. “8163. Designation of property to be leased. “8164. Authority for disposition of leased property. “8165. Use of proceeds. “8166. Construction standards. “8167. Exemption from State and local taxes. “8168. Limitation on number of agreements. “8169. Expiration.”.