(A) (i) The Secretary shall, under the rulemaking procedures under section 553 of title 5 , establish procedures for designating troubled public housing agencies, which procedures shall include identification of serious and substantial failure to perform as measured by the performance indicators specified under paragraph (1) and such other factors as the Secretary may deem to be appropriate. Such procedures shall provide that an agency that fails on a widespread basis to provide acceptable basic housing conditions for its residents shall be designated as a troubled public housing agency. The Secretary may use a simplified set of indicators for public housing agencies with less than 250 public housing units. The Secretary shall also designate, by rule under section 553 of title 5 , agencies that are troubled with respect to the program for assistance from the Capital Fund under section 1437g(d) of this title . (ii) The Secretary may also, in consultation with national organizations representing public housing agencies and public officials (as the Secretary determines appropriate), identify and commend public housing agencies that meet the performance standards established under paragraph (1) in an exemplary manner. (iii) The Secretary shall establish procedures for public housing agencies to appeal designation as a troubled agency (including designation as a troubled agency for purposes of the program for assistance from the Capital Fund under section 1437g(d) of this title ), to petition for removal of such designation, and to appeal any refusal to remove such designation.
(B) (i) Upon designating a public housing agency with more than 250 units as troubled pursuant to subparagraph (A) and determining that an assessment under this subparagraph will not duplicate any comparable and recent review, the Secretary shall provide for an on-site, independent assessment of the management of the agency. (ii) To the extent the Secretary deems appropriate (taking into account an agency’s performance under the indicators specified under paragraph (1)), the assessment team shall also consider issues relating to the agency’s resident population and physical inventory, including the extent to which (I) the agency’s comprehensive plan prepared pursuant to section 1437 l 4 of this title adequately and appropriately addresses the rehabilitation needs of the agency’s inventory, (II) residents of the agency are involved in and informed of significant management decisions, and (III) any projects in the agency’s inventory are severely distressed and eligible for assistance pursuant to section 1437v of this title . (iii) An independent assessment under this subparagraph shall be carried out by a team of knowledgeable individuals selected by the Secretary (referred to in this section as the “assessment team”) with expertise in public housing and real estate management. In conducting an assessment, the assessment team shall consult with the residents and with public and private entities in the jurisdiction in which the public housing is located. The assessment team shall provide to the Secretary and the public housing agency a written report, which shall contain, at a minimum, recommendations for such management improvements as are necessary to eliminate or substantially remedy existing deficiencies.
(C) The Secretary shall seek to enter into an agreement with each troubled public housing agency, after reviewing the report submitted pursuant to subparagraph (B) (if applicable) and consulting with the agency’s assessment team. Such agreement shall set forth— (i) targets for improving performance as measured by the performance indicators specified under paragraph (1) and other requirements within a specified period of time; (ii) strategies for meeting such targets, including a description of the technical assistance that the Secretary will make available to the agency; and (iii) incentives or sanctions for effective implementation of such strategies, which may include any constraints on the use of funds that the Secretary determines are appropriate. To the extent the Secretary deems appropriate (taking into account an agency’s performance under the indicators specified under paragraph (1)), such agreement shall also set forth a plan for enhancing resident involvement in the management of the public housing agency. The Secretary and the public housing agency shall, to the maximum extent practicable, seek the assistance of local public and private entities in carrying out the agreement.
(D) The Secretary shall apply the provisions of this paragraph to resident management corporations as well as public housing agencies.