49 1 nation of the need for low-income housing to meet needs not 2 being adequately met by private enterprise 3 4 5 6 7 8 9 10 "(1) the Secretary shall not make any contract with a public housing agency for preliminary loans (all of which shall be repaid out of any moneys which become available to such agency for the development of the projects involved) for surveys and planning in respect to any low-income housing projects (i) unless the governing body of the locality involved has by res olution approved the application of the public housing 11 agency for such preliminary loan; and (ii) unless the public housing agency has demonstrated to the satisfac 127 23 tion of the Secretary that there is a need for such low income housing which is not being met by private enterprise; and "(2) the Secretary shall not make any contract for loans (other than preliminary loans) or for annual contributions pursuant to this Act unless the governing body of the locality involved has entered into an agreement with the public housing agency providing for the local cooperation required by the Secretary pursuant to this Act. "(f) Subject to the specific limitations or standards in 24 this Act governing the terms of sales, rentals, leases, loans, 50 1 contracts for annual contributions, or other agreements, the 2 Secretary may, whenever he deems it necessary or desirable 3 in the fulfillment of the purposes of this Act, consent to the 4 modification, with respect to rate of interest, time of pay5 ment of any installment of principal or interest, security, 6 amount of annual contribution, or any other term, of any 7 contract or agreement of any kind to which the Secretary is 8 a party. When the Secretary finds that it would promote 9 economy or be in the financial interest of the Federal Gov10 ernment or is necessary to assure or maintain the low-income 11 character of the project or projects involved, any contract 12 heretofore or hereafter made for annual contributions, loans, 13 or both, may be amended or superseded by a contract of the 14 Secretary. Contracts may not be amended or superseded in 15 a manner which would impair the rights of the holders of 16 any outstanding obligations of the public housing agency 17 involved for which annual contributions have been pledged. 18 Any rule of law contrary to this provision shall be deemed 19 inapplicable. 20 "(g) In addition to modernization programs under21 taken with the amounts authorized under subsection (c), 22 the Secretary is authorized to undertake a program over the 23 next three fiscal years (1) to correct obsolescence in exist24 ing housing projects by improving the condition of dwelling 25 units in such projects to meet current standards of de 24-038 - 74 pt. 1 5 51 1 cent, safe, and sanitary housing; (2) to conform housing 2 projects to applicable code standards; and (3) to provide 3 facilities and equipment designed to improve the security of 4 the residents and the property. The Secretary is authorized 5 to enter into contracts for annual contributions under this 6 subsection aggregating not more than $45,000,000 per an7 num as may be approved in an appropriation Act. A contract for annual contributions under this subsection shall not 9 exceed a term of fifteen years. 8 10 "(h) (1) For the purpose of assisting families of low 11 income in acquiring homeownership in existing low-income 12 housing, a public housing agency is authorized, subject to 13 the approval of the Secretary, to sell a low-income housing 14 project to low-income families under such terms and condi15 tions as are consistent with a viable program of homeowner16 ship opportunities for such families. 17 "(2) Notwithstanding any other provision of this Act, 18 the sale of a project or a dwelling unit in a project shall not affect the Secretary's commitment to pay annual contri 19 20 butions with respect to such project, but such contributions 21 shall not exceed the maximum contributions authorized under 22 subsection (a). 23 24 25 "CONTRACT PROVISIONS AND REQUIREMENTS "SEC. 6. (a) The Secretary may include in any con tract for loans, annual contributions, sale, lease, mortgage, or 52 1 any other agreement or instrument made pursuant to this 2 Act, such covenants, conditions, or provisions as he may 5 3 deem necessary in order to insure the low-income character 4 and economic viability of the project involved. Any such contract may contain a condition requiring the maintenance 6 of an open space or playground in connection with the hous7 ing project involved if deemed necessary by the Secretary 8 for the safety or health of children. Any such contract shall 9 require that, except in the case of housing predominantly 10 for the elderly, high-rise elevator projects shall not be provided for families with children unless the Secretary makes a determination that there is no practical alternative. 11 12 13 "(b) Every contract made pursuant to this Act for 14 loans (other than preliminary loans) and annual contri15 butions shall provide that the development cost of the project 16 (excluding the cost of nondwelling facilities and the cost 17 of relocation payments and assistance) on which the compu18 tation of any annual contributions under this Act may be 19 based shall not exceed by more than 10 per centum the 20 appropriate prototype cost for the area determined pursuant 21 to section 3 of the Revised National Housing Act, except 22 where the Secretary determines that this limitation should 23 not be applied to the project because of special considerations 24 with respect to the cost of land or site improvements. 1 53 "(c) Every contract for annual contributions shall pro2 vide that 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 "(1) the Secretary may require the public housing agency to review and revise its maximum income limits for admission to the project if the Secretary determines that changed conditions in the locality make such revisions necessary in achieving the purposes of this Act; "(2) the public housing agency shall determine, and so certify to the Secretary, that each family in the project was admitted in accordance with duly adopted regula tions and approved income limits; and the public housing agency shall review the incomes of families living in the project at intervals of two years (or at shorter intervals where the Secretary determines it desirable); and "(3) the public agency shall promptly notify (A) any applicant determined to be ineligible for admission to the project of the basis for such determination and provide the applicant upon request, within a reasonable time after the determination is made, with an opportunity for an informal hearing on such determination, and (B) any applicant determined to be eligible for admission to the project of the approximate date of occupancy insofar as such date can be reasonably determined. "(d) Every contract for annual contributions with |