“ The Secretary shall determine whether to renew a contract for such a permanent housing project on the basis of certification by the collaborative applicant for the geographic area that— `` (1) there is a demonstrated need for the project; and `` (2) the project complies with program requirements and appropriate standards of housing quality and habitability, as determined by the Secretary. ”

“ Acquisition, rehabilitation, or construction.—Not later than 24 months after the announcement referred to in subsection (c) (2) , each recipient or project sponsor seeking the obligation of funds for acquisition of housing, rehabilitation of housing, or construction of new housing for a grant announced under subsection (c) (2) shall meet all requirements for the obligation of those funds, including site control, matching funds, and environmental review requirements. ”

“ The Secretary shall reallocate the funds for another homeless assistance and prevention project that meets the requirements of this subtitle to be carried out, if possible and appropriate, in the same geographic area as the area served through the original grant. ”

“ Limitations.—The 10 percent limitation under paragraph (1) shall not apply to collaborative applicants in which the rate of homelessness, as calculated in the most recent point in time count, is less than one-tenth of 1 percent of total population. ”

“ Balance of incentives for proven strategies.—To the extent practicable, in providing bonuses or incentives for proven strategies, the Secretary shall seek to maintain a balance among strategies targeting homeless individuals, families, and other subpopulations. The Secretary shall not implement bonuses or incentives that specifically discourage collaborative applicants from exercising their flexibility to serve families with children and youth defined as homeless under other Federal statutes. ”

“ Adjustments.—The Secretary may adjust the formula described in subsection (b) (2) as necessary— `` (1) to ensure that each collaborative applicant has sufficient funding to renew all qualified projects for at least one year; and `` (2) to ensure that collaborative applicants are not discouraged from replacing renewal projects with new projects that the collaborative applicant determines will better be able to meet the purposes of this Act. ”

“ Term of homelessness.—The mean length of episodes of homelessness for that geographic area— `` (A) is less than 20 days; or `` (B) for individuals and families in similar circumstances in the preceding year was at least 10 percent less than in the year before. `` (2) Families leaving homelessness.—Of individuals and families— `` (A) who leave homelessness, fewer than 5 percent of such individuals and families become homeless again at any time within the next 2 years ”

“ Administration of rental assistance.—Provision of permanent housing rental assistance shall be administered by a State, unit of general local government, or public housing agency. ́ ́. SEC. 1303. HIGH PERFORMING COMMUNITIES. The McKinney-Vento Homeless Assistance Act is amended by striking section 424 (42 U.S.C. 11384) and inserting the following: ``SEC. 424. Incentives for high-performing communities. `` (a) Designation as a High-Performing Community.— `` (1) In general.—The Secretary shall designate, on an annual basis, which collaborative applicants represent high-performing communities. ”