ASSISTANCE FOR SINGLE ROOM OCCUPANCY DWELLINGS.

SEC. 441. SECTION 8 ASSISTANCE FOR SINGLE ROOM OCCUPANCY DWELLINGS. (a) Increase in Budget Authority.— The budget authority available under section 5(c) of the United States Housing Act of 1937 for assistance under section 8(e)(2) of such Act is authorized to be increased by $35,000,000 on or after October 1, 1986, and by $35,000,000 on or after October 1, 1987. (b) Use of Funds.— The amounts made available under this section shall be used only in connection with the moderate rehabilitation of housing described in section 8(n) of the United States Housing Act of 1937 for occupancy by homeless individuals. (c) Allocation.— The amounts made available under this section shall be allocated by the Secretary of Housing and Urban Development on the basis of a national competition to the applicants that best demonstrate a need for the assistance under this section and the ability to undertake and carry out a program to be assisted under this section. To be considered for assistance under this section, an applicant shall submit to the Secretary of Housing and Urban Development a written proposal containing— (1) a description of the size and characteristics of the population within the applicant’s jurisdiction that would occupy single room occupancy dwellings; (2) a listing of additional commitments from public and private sources that the applicant might be able to provide in connection with the program; (3) an inventory of suitable housing stock to be rehabilitated with such assistance; and (4) a description of the interest that has been expressed by builders, developers, and others (including profit and nonprofit organizations) in participating in the program. No single city or urban county shall be eligible to receive more than 10 percent of the assistance made available under this section. (d) Fire and Safety Improvements.— Each contract for housing assistance payments entered into with the authority provided under this section shall require the installation of a sprinkler system that protects all major spaces, hard wired smoke detectors, and such other fire and safety improvements as may be required by State or local law. (e) Cost Limitation.— 101 STAT. 509 (1) The total cost of rehabilitation that may be compensated for in a contract for housing assistance payments entered into with the authority provided under this section shall not exceed $14,000 per unit, plus the expenditures required by subsection (d). (2) The Secretary of Housing and Urban Development shall increase the limitation contained in paragraph (1) by an amount the Secretary determines is reasonable and necessary to accommodate special local conditions, including— (A) high construction costs; or (B) stringent fire or building codes. (f) Contract Requirements.— Each contract for annual contributions entered into with a public housing agency to obligate the authority made available under this section shall— (1) commit the Secretary of Housing and Urban Development to make such authority available to the public housing agency for an aggregate period of 10 years, and require that any amendments increasing such authority shall be available for the remainder of such 10-year period; (2) provide the Secretary of Housing and Urban Development with the option to renew the contract for an additional period of 10 years, subject to the availability of appropriations; and (3) provide that, notwithstanding any other provision of law, first priority for occupancy of housing rehabilitated under this section shall be given to homeless individuals.