HB 1696 — An Act amending the act of December 3, 1959 (P.L.1688, No.621), known as the Housing Finance Agency Law, establishing the Pennsylvania Lease with Guaranteed Purchase Option Home Ownership Program and the Pennsylvania Lease with Guaranteed Purchase Option Home Ownership Program Fund.

PRINTER'S NO.   2086

                  THE GENERAL ASSEMBLY OF PENNSYLVANIA



                      HOUSE BILL
                      No. 1696
                                             Session of
                                               2025

     INTRODUCED BY FREEMAN, SAMUELSON, HILL-EVANS, GIRAL, KENYATTA,
        CEPEDA-FREYTIZ, PARKER, SANCHEZ, DALEY, BOYD, GREEN,
        SHUSTERMAN AND BURGOS, JULY 2, 2025

     REFERRED TO COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT,
        JULY 7, 2025


                                  AN ACT
 1   Amending the act of December 3, 1959 (P.L.1688, No.621),
 2      entitled "An act to promote the health, safety and welfare of
 3      the people of the Commonwealth by broadening the market for
 4      housing for persons and families of low and moderate income
 5      and alleviating shortages thereof, and by assisting in the
 6      provision of housing for elderly persons through the creation
 7      of the Pennsylvania Housing Finance Agency as a public
 8      corporation and government instrumentality; providing for the
 9      organization, membership and administration of the agency,
10      prescribing its general powers and duties and the manner in
11      which its funds are kept and audited, empowering the agency
12      to make housing loans to qualified mortgagors upon the
13      security of insured and uninsured mortgages, defining
14      qualified mortgagors and providing for priorities among
15      tenants in certain instances, prescribing interest rates and
16      other terms of housing loans, permitting the agency to
17      acquire real or personal property, permitting the agency to
18      make agreements with financial institutions and Federal
19      agencies, providing for the purchase by persons of low and
20      moderate income of housing units, and approving the sale of
21      housing units, permitting the agency to sell housing loans,
22      providing for the promulgation of regulations and forms by
23      the agency, prescribing penalties for furnishing false
24      information, empowering the agency to borrow money upon its
25      own credit by the issuance and sale of bonds and notes and by
26      giving security therefor, permitting the refunding,
27      redemption and purchase of such obligations by the agency,
28      prescribing remedies of holders of such bonds and notes,
29      exempting bonds and notes of the agency, the income
30      therefrom, and the income and revenues of the agency from
31      taxation, except transfer, death and gift taxes; making such
32      bonds and notes legal investments for certain purposes; and
 1      indicating how the act shall become effective," establishing
 2      the Pennsylvania Lease with Guaranteed Purchase Option Home
 3      Ownership Program and the Pennsylvania Lease with Guaranteed
 4      Purchase Option Home Ownership Program Fund.
 5      The General Assembly of the Commonwealth of Pennsylvania
 6   hereby enacts as follows:
 7      Section 1.    The act of December 3, 1959 (P.L.1688, No.621),
 8   known as the Housing Finance Agency Law, is amended by adding an
 9   article to read:
10                                 ARTICLE IV-E
11         PENNSYLVANIA LEASE WITH GUARANTEED PURCHASE OPTION HOME
12                             OWNERSHIP PROGRAM
13   Section 401-E.    Definitions.
14      The following words and phrases when used in this article
15   shall have the meanings given to them in this section unless the
16   context clearly indicates otherwise:
17      "Advertisement."    A written, visual or oral communication
18   made to a lessee or prospective lessee by means of personal
19   representation, newspaper, magazine, circular, billboard, direct
20   mailing, sign, radio, television, telephone or other means of
21   communication that aids, promotes or assists, directly or
22   indirectly, a lease with guaranteed purchase option agreement.
23      "Escrow account."    A bank account or other financial account
24   administered by the agency or its designee in which all funds
25   paid by lessees toward the closing costs and down payment to
26   purchase the subject premises and any and all matching program
27   funds are deposited and maintained unless paid directly to the
28   title company at closing.
29      "Fund."     The Pennsylvania Lease with Guaranteed Purchase
30   Option Home Ownership Program Fund established in section 406-E.
31      "Lease with guaranteed purchase option agreement" or
32   "agreement."    An agreement for the use of real property by an

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 1   individual primarily for personal, family or household purposes
 2   for an initial period of not less than one year that is
 3   automatically renewable for successive one-year periods and that
 4   provides for a guaranteed option for the lessee to purchase the
 5   property. The term does not include an agreement for
 6   agricultural, business or commercial purposes or an agreement in
 7   which the individual that will use the property is an
 8   organization.
 9      "Lessee."    An individual who leases real property in
10   accordance with a lease with guaranteed purchase option
11   agreement.
12      "Lessor."    A person or entity that owns residential property:
13          (1)     constructed or rehabilitated under the program; and
14          (2)     to be leased with a guaranteed option to purchase to
15      an eligible lessee.
16      "Monthly payment."    The total amount due under a lease with
17   guaranteed purchase option agreement that is attributable to
18   rent and an amount escrowed for the purchase of the property,
19   and which agreement provides that the escrowed amount is not
20   less than 20% of the monthly payment.
21      "Program."    The Pennsylvania Lease with Guaranteed Purchase
22   Option Home Ownership Program established in section 402-E.
23      "Program funds."    All money appropriated by the General
24   Assembly for the purpose of awarding grants or loans under the
25   program, including money from sources other than the
26   Commonwealth that are provided for the program.
27      "Purchase price."    The purchase price of the subject
28   property, as stated in a lease with guaranteed purchase option
29   agreement, which is equal to the actual market value of the
30   property on the date of the agreement, as determined in a real

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 1   estate appraisal report provided by a certified residential real
 2   estate appraiser who is mutually agreed to by the lessor and
 3   lessee. The lessor shall pay the cost of the appraisal. In the
 4   event the lessor and lessee cannot agree upon an appraiser, each
 5   shall select an appraiser to produce an appraisal report, with
 6   each bearing their own costs for the report, and the purchase
 7   price shall be equal to the average of the values determined in
 8   the two appraisal reports.
 9   Section 402-E.    Establishment.
10      The Pennsylvania Lease with Guaranteed Purchase Option Home
11   Ownership Program is established and shall be administered by
12   the agency. The program shall be dependent on the availability
13   of program funds.
14   Section 403-E.    Structure of program.
15      (a)   Project types.--The program may provide funding for
16   sustainable home ownership rehabilitation located in distressed
17   and disinvested census tracts in order to provide decent, safe
18   and sanitary dwellings for lease with a guaranteed purchase
19   option to an individual whose household income is at or below
20   80% of the area median income for the metropolitan area
21   determined by the Department of Housing and Urban Development.
22      (b)   Use of program funds.--Program funds for projects under
23   subsection (a) may be used for the following:
24            (1)   Predevelopment activities, including title searches,
25      market studies, project planning, architectural services,
26      legal and engineering studies and related fees.
27            (2)   Acquisition and disposition of real property.
28            (3)   Site preparation, including demolition of existing
29      structures, improvements and infrastructure.
30            (4)   Rehabilitation and construction.

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 1            (5)   Matching funds for the lessee's escrow account.
 2      (c)   Affordable housing matching funds.--Program funds may be
 3   used as a set aside for matching funds for counties that have
 4   established optional county affordable housing funds under 53
 5   Pa.C.S. Ch. 60 (relating to optional affordable housing
 6   funding). To receive matching funds under this subsection, a
 7   county must annually report detailed information as required by
 8   the agency on the use of the optional affordable housing funds
 9   for county projects. The information shall be included in the
10   agency's report under section 405-E.
11      (d)   Mandatory preferences.--To the extent possible, the
12   agency shall adopt written policies to give preference to
13   projects that utilize properties from inventories maintained by
14   public entities, including municipalities, land banks and
15   redevelopment agencies.
16      (e)   Discretionary preferences.--The agency may adopt written
17   policies to give preference to projects, including, but not
18   limited to, projects that:
19            (1)   Meet weatherization standards promulgated by the
20      agency.
21            (2)   Meet energy efficiency standards promulgated by the
22      agency.
23            (3)   Are accessible to people with physical disabilities.
24      (f)   Considerations.--The agency shall take into
25   consideration geographical distribution of program funds to
26   ensure that all areas of this Commonwealth participate to the
27   greatest extent possible.
28      (g)   Allocation.--The agency shall allocate at least 30% of
29   program funds for housing projects that benefit households with
30   household incomes that are less than 50% of the area median

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 1   income for the metropolitan area as determined by the Department
 2   of Housing and Urban Development. To better assist households
 3   below 50% of the area median income, the agency shall prioritize
 4   lessees in a Housing Choice Vouchers Homeownership Program under
 5   Federal law.
 6      (h)   Monitoring and compliance.--The agency shall develop and
 7   implement criteria for monitoring compliance with program
 8   requirements.
 9   Section 404-E.    Plan.
10      (a)   Duty to adopt.--Within 90 days of the effective date of
11   this subsection and by March 15 of each year thereafter, the
12   agency shall adopt a plan that specifies the method by which
13   program funds will be distributed and administered that year.
14      (b)   Publication and posting.--
15            (1)   The agency shall submit the proposed plan, including
16      a comment response document to be produced as part of the
17      public comment process, to the chair and minority chair of
18      the Urban Affairs and Housing Committee of the Senate and the
19      chair and minority chair of the Housing and Community
20      Development Committee of the House of Representatives, and to
21      the Legislative Reference Bureau for publication in the next
22      available issue of the Pennsylvania Bulletin, and shall post
23      the proposed plan on the agency's publicly accessible
24      Internet website for public comment no later than 45 days
25      prior to adoption of the proposed plan under subsection (a).
26            (2)   All comments submitted to the agency in writing are
27      public records accessible for inspection and duplication in
28      accordance with the act of February 14, 2008 (P.L.6, No.3),
29      known as the Right-to-Know Law, and the agency shall
30      incorporate the comments into the comment response document.

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 1   Section 405-E.    Reporting.
 2      (a)     Duty of agency.--Within 90 days following the close of
 3   the first calendar year after the effective date of this
 4   subsection and by July 1 of every year thereafter, the agency
 5   shall issue a report containing a financial statement, an
 6   itemized list of projects funded, demographic data, including
 7   gender, disability, number of children in the household and race
 8   and ethnicity and income of the individuals and communities
 9   served, and a description of other expenditures in the preceding
10   year. The agency shall submit the report to the Governor, the
11   Auditor General, the chair and minority chair of the Urban
12   Affairs and Housing Committee of the Senate and the chair and
13   minority chair of the Housing and Community Development
14   Committee of the House of Representatives and shall post the
15   report on the agency's publicly accessible Internet website.
16      (b)     Public record.--The report shall be a public record
17   accessible for inspection and duplication in accordance with the
18   act of February 14, 2008 (P.L.6, No.3), known as the Right-to-
19   Know Law.
20   Section 406-E.    Pennsylvania Lease with Guaranteed Purchase
21                 Option Home Ownership Program Fund.
22      The Pennsylvania Lease with Guaranteed Purchase Option Home
23   Ownership Program Fund is established in the State Treasury.
24   Interest and earnings of the fund shall remain in the fund. All
25   program funds shall be deposited into the fund. The money in the
26   fund and interest accruing thereon is appropriated to the agency
27   on a continuing basis to carry out the provisions of this
28   article.
29   Section 407-E.    Funding.
30      Implementation of this article shall be contingent upon

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 1   sufficient program funds being deposited into the fund in
 2   accordance with section 406-E to carry out the purposes of this
 3   article. In a year in which there are insufficient program funds
 4   in the fund for the purposes outlined in this article, the
 5   program shall be suspended until program funds exist in
 6   sufficient amount.
 7   Section 408-E.        Disclosures required in connection with lease
 8                  with guaranteed purchase option agreement.
 9      (a)   Duty of lessor.--A lessor shall comply with any and all
10   local occupancy or other requirements applicable to rental
11   dwellings and disclose to the lessee all of the following in a
12   clear and conspicuous manner:
13            (1)   A brief description of the leased property,
14      sufficient to identify the property to the lessor and lessee.
15            (2)   The total amount of all payments due under the
16      agreement, including:
17                  (i)    The total amount of the monthly payment due
18            under the agreement, to be applied toward rent.
19                  (ii)    The total amount of the monthly payment due
20            under the agreement, to be applied toward the escrow
21            account.
22                  (iii)    The total amount of each payment due under the
23            agreement for utilities that are provided by the lessor,
24            if not included in the lease payment.
25                  (iv)    Any security deposit to be collected by the
26            lessor and escrowed in accordance with sections 511.1 and
27            511.2 of the act of April 6, 1951 (P.L.69, No.20), known
28            as The Landlord and Tenant Act of 1951.
29                  (v)    Any other charges, individually itemized,
30            payable by the lessee to the lessor.

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 1            (3)    The timing of lease payments.
 2            (4)    The right of the lessee to reinstate as provided in
 3      section 411-E.
 4            (5)    The name and contact information of any property
 5      manager acting as agent for the lessor for the rental and
 6      management of the property.
 7            (6)    The condition upon which the lessee or lessor may
 8      terminate the lease.
 9            (7)    The guaranteed option of the lessee to purchase the
10      leased property.
11            (8)    The purchase price of the real property that is the
12      subject of the agreement.
13            (9)    A statement as to whether any contractor or third-
14      party warranties on appliances and installed equipment, roof
15      or other improvements to the leased property will be
16      transferred to the lessor or lessee in the event the lessee
17      purchases the property.
18            (10)    A statement that the lessee is not required to
19      purchase insurance for the property, although the lessee is
20      advised to purchase renter's insurance.
21            (11)    A notice in a prominent place in at least 12-point
22      type or in legible print with letters at least one-eighth
23      inch in size, in substantially the following form:
24                   NOTICE: THIS LEASE with GUARANTEED PURCHASE OPTION
25                   AGREEMENT IS REGULATED BY STATE LAW AND MAY BE
26                   ENFORCED BY THE ATTORNEY GENERAL OR BY PRIVATE LEGAL
27                   ACTION.
28      (b)   Lease to be written.--A lease with guaranteed purchase
29   option agreement shall be in writing and the information
30   required by this section shall be disclosed by the lessor prior

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 1   to execution of the agreement and shall be disclosed either in
 2   the agreement or on a dated, executed document that identifies
 3   the lease with guaranteed purchase option agreement and the
 4   parties to it.
 5      (c)    Requirements for disclosures.--Except as provided in
 6   subsection (a)(11), the information required to be disclosed by
 7   this section shall be printed or typed in at least 12-point bold
 8   face type and numerical amounts and percentages shall be stated
 9   in figures. All information required by this section shall be
10   stated in plain language, using words and phrases of common
11   meaning. The information shall be appropriately divided and
12   captioned by its sections.
13      (d)    Disclosure of additional information.--A lessor may
14   disclose information that is not required by this section if the
15   additional information is not stated, used or placed in a manner
16   that will contradict, obscure or distract attention from the
17   required information.
18   Section 409-E.     Prohibited terms.
19      A lessor may not require any of the following from the
20   lessee:
21             (1)   The purchase of insurance.
22             (2)   Any payment in addition to the lease payments
23      specified in the agreement other than the payment described
24      in section 412-E that is required for the lessee to acquire
25      ownership of the leased property.
26             (3)   Lease payments that in the aggregate exceed the
27      maximum amount specified in section 416-E.
28             (4)   A penalty for early termination of the agreement.
29             (5)   A fee for collection of a lease payment.
30             (6)   Any requirement for mandatory arbitration to resolve

20250HB1696PN2086                     - 10 -
 1      disputes pertaining to the agreement.
 2   Section 410-E.        Protections against eviction.
 3      (a)   Reasons for termination or nonrenewal of agreement.--A
 4   lessor may terminate or refuse to renew the agreement or may
 5   evict a lessee and dwelling occupants only for one of the
 6   following reasons:
 7            (1)   Nonpayment of rent, after notice of default and
 8      failure to cure as provided under this article.
 9            (2)   A second or subsequent material violation of the
10      agreement occurring within a six-month period when the
11      violation has not been remedied within 30 days of receipt of
12      written notice of the violation.
13      (b)   Eviction procedure.--A lessor may only commence an
14   action in eviction in accordance with the following procedure:
15            (1)   Prior to the commencement of the eviction proceeding
16      or the termination of or failure to renew the agreement and
17      after the expiration of the grace period required by section
18      411-E(c), the lessor shall notify the lessee in writing of
19      the particular breach or violation of the lease by certified
20      or registered mail.
21            (2)   In the case of nonpayment of rent, the notice shall
22      state that an eviction proceeding may be commenced if:
23                  (i)    the lessee does not pay the overdue rent within
24            20 days from the date of service if the notice is given
25            on or after April 1 and before September 1 and 30 days if
26            given on or after September 1 and before April 1; or
27                  (ii)    an additional nonpayment of rent occurs within
28            six months of the giving of the notice, in which case the
29            landlord may commence an immediate eviction proceeding.
30            (3)   In the case of a breach of the agreement other than

20250HB1696PN2086                       - 11 -
 1      nonpayment of rent, the notice shall describe the particular
 2      breach or violation and provide an opportunity to cure within
 3      30 days.
 4            (4)   An eviction action may not be commenced and the
 5      lessor may not terminate or refuse to renew the agreement
 6      unless the lessee has been notified as required by this
 7      section. Upon a second or subsequent material violation or
 8      breach occurring within six months of an unremedied material
 9      violation or breach, the lessor may commence eviction
10      proceedings at any time within 60 days of the last violation
11      or breach.
12      (c)   Eviction diversion program.--Prior to the commencement
13   of an eviction proceeding, the lessor shall utilize at least one
14   eviction diversion program if any such program is available in
15   the jurisdiction. If the lessee initiates utilization of an
16   eviction diversion program, the lessor must participate.
17      (d)   Compliance with other law.--Any lease termination,
18   refusal to renew a lease or eviction by a lessor shall comply
19   with all other applicable Federal, State and local laws.
20   Section 411-E.    Reinstatement of agreement after default.
21      (a)   Right of lessee.--A lessee whose agreement has been
22   terminated for failure to make timely payments has the right to
23   reinstate the original agreement, within six months of the lease
24   termination, without losing any right or option previously
25   acquired under the agreement if the leased premises is vacant
26   and habitable at the time of reinstatement.
27      (b)   Payments, charges and fees permitted.--Before
28   reinstating an agreement, the lessor may require the lessee to
29   pay any unpaid lease payments.
30      (c)   Grace period.--A lessor shall allow a lessee a grace

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 1   period of not less than 15 days before the lessee is determined
 2   to be in breach of the lease for nonpayment of rent or any other
 3   violation of the lease. No lessee shall be entitled to more than
 4   three grace periods per year.
 5   Section 412-E.        Acquiring ownership.
 6      (a)   Right of lessee.--The lessee may exercise the option to
 7   purchase the leased property and use the escrow funds for the
 8   purchase if:
 9            (1)   the lessee has obtained a loan preapproval or
10      commitment from a financial institution to purchase the home;
11      or
12            (2)   the lessee has otherwise satisfied the terms of the
13      agreement for exercising the option to purchase.
14      (b)   Agreement.--The agreement shall be based on the standard
15   agreement described in section 417-E(a).
16      (c)   Construction.--Nothing in this section shall be
17   construed to preclude the lessee from exercising the option to
18   purchase the leased property prior to any dates specified in the
19   agreement within which the option may be exercised.
20   Section 413-E.        Advertisements and mandatory information to be
21                  supplied.
22      (a)   Prohibited advertisements.--An advertisement for a lease
23   with guaranteed purchase option agreement may not state that:
24            (1)   A lease of any specific property is available at
25      specific amounts or on specific terms unless the lessor will
26      lease the property at those amounts or on those terms.
27            (2)   A payment or a lease payment is due upon origination
28      of a lease without disclosing all of the following:
29                  (i)    The payment due upon origination of the lease.
30                  (ii)    The lease payment.

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 1                  (iii)    The total number of lease payments necessary
 2            to obtain ownership of the property that is the subject
 3            of the agreement.
 4      (b)   Amounts required.--All property offered under a lease
 5   with guaranteed purchase option agreement shall include all of
 6   the following:
 7            (1)   The purchase price of the property.
 8            (2)   The amount of the monthly payment.
 9            (3)   The amount of the monthly payment that will be
10      deposited into the lessee's escrow account for use in
11      purchasing the property.
12            (4)   The total number of lease payments necessary to
13      acquire ownership of the property that is the subject of the
14      lease with guaranteed purchase option agreement.
15   Section 414-E.        Liability of lessor for noncompliance.
16      (a)   Extent of liability.--A lessor who fails to comply with
17   the requirements of this article with respect to a lease with
18   guaranteed purchase option agreement is subject to any remedy
19   available under contract law and, in addition, is liable to the
20   lessee in an amount equal to the sum of the following:
21            (1)   The costs of the action and reasonable attorney fees
22      as determined by a court.
23            (2)   The greater of the following:
24                  (i)    The actual damages sustained by the lessee
25            because of the failure of the lessor.
26                  (ii)    Twenty-five percent of the total amount
27            necessary to acquire ownership of the property that is
28            the subject of the lease with guaranteed purchase option
29            agreement.
30      (b)   Single recovery.--If a particular lease with guaranteed

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 1   purchase option agreement has more than one lessee, only one
 2   recovery of damages is allowed under subsection (a)(2) for a
 3   violation of this article. Multiple violations in connection
 4   with an agreement shall entitle the lessee or multiple lessees
 5   to only one recovery under this section.
 6      (c)   When offset prohibited.--
 7            (1)   A lessee may not take action to offset an amount for
 8      which a lessor is potentially liable under subsection (a)(2)
 9      against an amount owed by the lessee, unless the amount of
10      the liability of the lessor has been determined by a court of
11      competent jurisdiction in an action in which the lessor was a
12      party.
13            (2)   Paragraph (1) shall not be construed to bar a lessee
14      in default on an obligation arising from the agreement from
15      asserting a violation of this article in an original action
16      or as a defense or counterclaim to an action brought by the
17      lessor to collect amounts owed by the lessee under the
18      agreement.
19   Section 415-E.    Eligible lessees.
20      The program shall be limited to households that have incomes
21   equal to or less than 80% of the area median income for the
22   metropolitan area as determined by the Department of Housing and
23   Urban Development.
24   Section 416-E.    Maximum allowable monthly payments.
25      The agency shall determine maximum allowable monthly payments
26   under a lease with guaranteed purchase agreement, which shall
27   not exceed 110% of the fair market rent for the county in which
28   the property is located, as published by the Department of
29   Housing and Urban Development in accordance with 42 U.S.C. §
30   1437a(b)(2) (relating to rental payments). Not less than 20% of

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 1   the monthly payment shall be designated for escrow on the
 2   lessee's behalf to be used for the purchase of the property. The
 3   remainder of the monthly payment shall be transmitted to the
 4   lessor as rent.
 5   Section 417-E.    Standard lease agreement.
 6      (a)   Duty of agency.--The agency shall develop a standard
 7   lease agreement for all lessees and lessors participating in the
 8   program, including the following components:
 9            (1)   The maximum number of years the lessee may lease the
10      property without exercising the lessee's option to purchase
11      under the terms of the agreement, which shall not be less
12      than 10 years. The agreement shall specify that the lessee
13      may, at the lessee's discretion, exercise the option to
14      purchase sooner than the maximum time period. Upon the
15      request of the lessee, the agency shall provide assistance to
16      the lessee in obtaining financing to purchase the property
17      through the agency's Statewide network of mortgage lenders
18      and brokers.
19            (2)   The amount of each monthly rental payment to be
20      deposited into an interest-bearing escrow account and to be
21      used towards the purchase of the home.
22            (3)   A provision that the lessor shall apply for any real
23      estate tax abatement available in the jurisdiction in which
24      the property is situated. The monthly payment shall be set as
25      if no abatement is in place. The portion of the monthly
26      payment attributed to the difference between the abated taxes
27      and the unabated taxes shall be deposited into the escrow
28      account for the benefit of the lessee and shall be counted
29      toward the match described in subsection (b).
30            (4)   A requirement that all lessees participate in home

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 1      ownership counseling through the agency's Housing Counseling
 2      network at no cost to the lessee prior to exercising the
 3      option to purchase.
 4            (5)   A provision that the lease constitutes a traditional
 5      landlord and tenant agreement with the landlord remaining
 6      responsible for all traditional maintenance and financial
 7      costs associated with the property, except utilities or
 8      specific obligations, such as snow removal, which the lease
 9      clearly specifies are to be paid by the lessee.
10            (6)   A provision stating that any other agreement or
11      contractual obligation between the parties must be in
12      writing.
13      (b)     Matching funds.--The agency shall deposit into the
14   escrow account amounts from the fund to match the lessee's
15   deposits on a 1:1 basis. The matching funds shall be deposited
16   with the same frequency as the lessee's deposits to the escrow
17   account.
18   Section 418-E.    Escrow accounts.
19      The agency shall specify the type of account in which escrow
20   deposits are to be maintained, including the following:
21            (1)   The specific accounting of each lessee's escrowed
22      funds, if separate accounts are not maintained for each
23      lessee in the program.
24            (2)   The process for handling of escrow accounts in
25      instances of eviction for nonpayment and damages to property.
26            (3)   A provision stating that any remaining escrow amount
27      deposited by a lessee who defaults under, or chooses to
28      terminate, the agreement shall revert to the lessee.
29   Section 419-E.    Exemption from realty transfer tax.
30      A transfer of real property to a lessee from a lessor under

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 1   the program shall be exempt from both the State and local realty
 2   transfer tax under Articles XI-C and XI-D of the act of March 4,
 3   1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, and
 4   section 301.1 of the act of December 31, 1965 (P.L.1257,
 5   No.511), known as The Local Tax Enabling Act.
 6   Section 420-E.   Guidelines.
 7      Within 180 days of the effective date of this section, the
 8   agency shall establish guidelines to carry out the provisions of
 9   this article.
10      Section 2.    This act shall take effect in 90 days.




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