[4 __-~ 3 :4. 18 2 I :}lEB “770ég N90 §?IgJRG'I‘Er’R . . S 2 1.1 B RA RY washmgzmn Lénfvemitv vwzgrgs E~E§NGTON NOV 17 1989 firm. 3 Issue Brief 1- -, .153’; 1' :3 ?’ ‘':v’°.’':‘‘-:’f'"_”' "‘ V "-3 P Px h¢;‘§ 1" :5" :3-M» .. ~ Aim as M0. e::i: '~ M ‘RR. 3 § CONGRESSIONAL RESEARCH SERVICE LIBRARY OF CONGRESS HOUSING ASSISTANCE TO LOW- AND MODERATE-INCOME HOUSEHOLDS ISSUE BRIEF NUMBER IB79058 AUTHOR: “E” Grace Milgram Economics Division THE LIBRARY OF CONGRESS CONGRESSIONAL RESEARCH SERVICE MAJOR ISSUES SYSTEM DATE ORIGINATED 05/30/79 DATE UPDATED 07/20/82 FOR ADDITIONAL INFORMATION CALL 287-5700 0723 CRS- l IB79058 UPDATE-O7/20/82 SSUE DEFINITION Beginning in the l930s with the low-rent public housing program, the Federal role in housing for low- and moderate—income households has expanded significantly. In 1949 Congress adopted a national housing policy calling for the realization, as soon as feasible, of a decent home and suitable living environment for every American family. The Federal Government has developed a variety of tools and programs in an effort to achieve this goal. These include public housing, rental assistance payments, FHA mortgage insurance, the development of secondary mortgage market institutions, and programs for rural housing administered by the Farmers Home Administration (FmHA) of the Department of Agriculture. The largest assistance, in monetary terms, is that given by tax laws which permit deduction of mortgage interest and property tax payments from gross income in computing a house owner's income tax. This issue brief, however, will be concerned only with HUD- and FmHA- administered housing subsidy programs to assist persons with low or moderate income. Although such programs have been in existence_for 40 years, there is little consensus as to what programs will best serve the, nation's housing needs. Over the years a number of issues have arisen in addition to the question of what level of assistance should be funded. These include questions of subsidies for low versus moderate income persons; supporting new housing versus promoting conservation of the old stock; and ‘providing production subsidies to owners versus cash assistance to families. At the same time, challenges exist in ensuring the proper administration of housing assistance programs and in fashioning an effective link between housing and the process of community development. BACKGROUND AND POLICY ANALYSIS Initially, housing assistance took the form of construction of individual public low-rent projects. Later, while projects continued to be built, programs were added directed toward improving the existing stock through housing code enforcement and rehabilitation, sometimes as part of activities to encourage neighborhood preservation. In the late 1950s and 1960s dissatisfaction with public housing projects, which often were high-rise, dense concentrations of families with social problems, led to programs which gave the Public Housing Authorities power to "lease units in the existing stock or in newly constructed, privately owned buildings, or to purchase "turnkey" projects built by private developers. To help families whose incomes were slightly higher than those eligible for public housing, but not able to pay market rents for standard quality housing, other assistance programs were added which relied upon reducing the financing costs of new construction. Loans at below market interest rates were made to private developers to build units for families with incomes below the median (Section 22l—d-3) or for elderly families (Section 202). Assistance to rural households was extended in direct loans through programs administered by the Farmers Home Administration (FmHA), at rates of interest that varied according to the borrower's income and FmHA's borrowing rate (Section 502). The effort to develop alternatives to public housing projects also resulted in a rent-supplement program, in which HUD paid the difference between the established rent and the family's rent payment of 25% of its income, for elderly or handicapped families, those moving from substandard units, or those forced to relocate by governmental action or disaster. Use of these supplements was limited to designated projects built under one of the CRS- 2 IB79058 UPDATE-07/20/82 construction subsidy programs. These construction programs, in which a governmental agency either made a direct loan or purchased the low-interest mortgage from the lender, result in an immediate, large impact upon the federal budget. The housing legislation of 1968, while reaffirming the national housing goal adopted in 1949, called for subsidized construction of 6,000,000 units over a ten—year period. To minimize the impact of such a program upon the budget, the form of subsidy in the major housing assistance programs was shifted from a capital loan to an annualrinterest payment t9-a P§¥Y§te_l€nd€r_WhiCh--¥95uCed the effective rate of interest for mortgages to %. Both home—purchasers (Section 235) and developers of rental units (Section 236) were eligible for such interest assistance. Eligibility for home purchase or for residency in an assisted rental project was limited to families with incomes below l35% of the maximum income for admittance to public housing in the particular area. Families purchasing houses paid at least 20% of their income toward mortgage payments, taxes, and insurance; if renting, they paid at least 25% of income. These percentage payments were minimums; a higher payment was necessary if the interest reduction was insufficient to lower rents or mortgage, tax, and insurance payments to an amount that could be covered by the 20 or 25 percent figures. Rent payments in public housing were limited to 25% of income in subsequently adopted "Brooke amendments", and operating subsidies authorized to replace the lost income to housing projects. Through these and related programs, production of more than one and a half million subsidized units was achieved between 1961 and 1972, of which some 700,000 were assisted by either Section 235 or Section 236 after 1969. In the early 1970s, however, some of these programs came under attack for being excessively expensive in both initial construction costs and operatir expenses, and subject to unacceptably high rates of default and foreclosure. Supporters claimed that the problems associated with these programs did not require their abandonment, but rather their improvement. For example, they maintained that the most serious problems with the FHA programs have been poor administration, lack of counseling, and in some places fraud, bribery, and other illegal activities. The Administration however, responded to the criticisms by terminating all new activity under the major subsidy programs subsequent to Jan. 5, l973, except for honoring previous commitments. As a consequence of this suspension, activity in production of subsidized housing dropped sharply and has continued at a lower level than that reached in the early 1970s. Only 45% of the 1968 goal of 6 million subsidized units was met. One-third of the rehabilitation goal of one million units was achieved, while 47% of the 5 million new units were built. CURRENT PROGRAMS Section 8. Assisted housing activity was slowly renewed in response to court suits or new legislation, after its virtual cessation because of the 1973 moratorium. The major activity now is conducted in a program known as Section 8, established in the Housing and Community Development Act of 1974. Eligible households are those with incomes under 80% of median in their area, adjusted for family size. (Those with incomes under 50% of median are called "very low-income"; others are "lower-income".) In an attempt to targe assistance to the most needy a 1981 amendment limits occupancy by lower-income families to 10% of units re-rented after passage of the Housing and Community Development Act of 1981, and to 5% of all units subsidized thereafter. According to a 1979 amendment, preference is to be given to CRS- 3 IB79058 UPDATE-O7/20/82 families who occupy substandard housing or who are involuntarily displaced. The family currently pays 15 to 25% of its income in rent, and HUD pays the owner the difference between the tenant's payment and a contract rent. The "981 amendments, in an effort to reduce Federal costs, increases rent « payments to 30% of adjusted income, with the increase to be phased in over 5 years. Contract rents, subject to some exceptions, cannot exceed HUD-established Fair Market Rents (FMR), which are based on prevailing rents for units of modest quality. Units may be in existing housing, or in new construction or rehabilitated units built under commitment from HUD. The division among these types is to be made on the basis of community desires as expressed in the Housing Assistance Plans which localities must prepare to obtain Community Development Block Grants, subject to limitations on mix expressed in authorization or appropriation bills. Units can be publicly or privately owned (although not in a public housing project), but the emphasis is on private ownership. Rental and administrative procedures vary among the programs, but in general the owner is responsible for all management. The direct assistance is solely by means of the payment on behalf of the tenant, although provision is made for limited payment for vacant units in new construction. No direct assistance is given in obtaining either construction or permanent financing, beyond FHA mortgage insurance. Further indirect assistance to new construction, however, can come through financing obtained from state housing finance agencies or local public housing authorities, who derive their funds from sale of tax-exempt bonds. In addition, to the limit of appropriations, FHA-insured mortgages taken by private lenders may be written with a 7 l/2% interest rate and then sold to the Government National Mortgage Corporation (GNMA). The shift to Section 8 was made for a number of reasons. For the first time, substantial use could be made of the existing housing stock, with a consequent reduction in per-unit subsidy costs from those incurred in new construction. It was hoped that use of the existing stock would provide recipients of aid with a greater choice of location and housing type, since they would not be restricted to specific, designated developments. This was seen as a way not only of increasing household satisfaction but also of promoting racial and income integration, as families could move out of concentrated minority-occupied, low-income areas. The higher income the subsidy provided owners could encourage maintenance of the stock, which otherwise faced deterioration, and improvement of already deteriorated units could be fostered by the rehabilitation program. Fear was expressed by opponents of this reliance on existing housing that in places with low vacancy rates rents would be driven up for all renters, particularly those of lower income who did not receive a subsidy; that in some places there might be an absolute shortage of standard-quality rental units relative to the number of subsidized households; and that even if there were apparently a sufficient number of units, vacant units might not match the needs of particular types of households, such as large families. As the program has operated, further concern has been expressed that if the acceptable rent is held at a relatively low level, it prevents the dispersion of low-income families out of inner-city areas. Even before the Section 8 program was adopted, HUD had undertaken an Experimental Housing Allowance Program to test the feasibility and advisability of providing a rental subsidy for use in the existing stock. The results of this experiment have not been completely analyzed, and neither it nor the operation of the Section 8 program has provided conclusive answers to the questions raised by the opposing sides of this discussion. CRS- 4 IB79058 UPDATE-O7/20/82 The Section 8 subsidy method has been successful in eliminating the gap that previously existed among eligible households, which prevented assistance being given to those whose incomes were too high for entrance into public housing but too low to meet the basic rent payment required of residents Section 236 projects. It has also provided a means of increasing rents received by owners as operating costs rise in an inflationary period, thereby eliminating a problem that had caused serious financial problems for many projects subsidized by means of lower mortgage interest. pBecause of a number of difficulties, the Section 8 program was slow in getting under way. Changes in the general economic situation, experience with the program, and amendments to the law which corrected some apparent deficiencies have served to make it fully operational. Since its inception, through April 30, 1982, funds have been reserved for almost two million units, of which more than half are in the existing stock. Approximately 1,400,000 of these are completed or, in the case of existing units, ready for tenant certification by a local public housing agency. About two-thirds of these are for existing units. An additional 681,000 units were under construction, either as new units or undergoing rehabilitation. Three-tenths of the existing units and over two-thirds of the completed new construcion units were designated for the elderly and handicapped. By the end of March, 1982, approximately 1,211,000 units were occupied, about half by the elderly. Among both elderly and families, the program is providing housing primarily to those of very low income. This seems to be a matter of self-selection, rather than the result of deliberate actions of owners or public housing agencies. Conventional Public Housing. Although Section 8 is the program currentlv adding most units to the subsidized stock, other programs continue t function. Conventional public housing contains the largest stock, housing approximately 1.2 million families. Current production is at a low level, with new constuction starts in FY81 reaching 26,800 units. This, however, more than doubled the FY78 number of 11,300. Reservations for new construction, dropped, however, from 68,500 in FY78 to 30,800 in FY80. Problems in finding acceptable sites, concern about receiving sufficient operating subsidy to cover even currently owned units, and in some areas a preference for existing-unit Section 8 have all militated against greater production in the program. A question had also arisen as to how to maintain the low income nature of the projects approaching 40-year usage, since operating subsidies were authorized only for projects under annual contributions contracts which have a 40-year duration. In the Housing and Community Development Amendments -of 1979, Congress authorized continuing payment of the operating subsidy after the expiration of the annual contributions contract, provided the project continues to serve low-income tenants. The Housing and Community Development Admendments of 1981 has changed the income deductions and adjustments to make them the same as in a revised Section 8, and raises rent payments to 30% of adjusted income, with the increase to be phased in over a 5-year period. Section 202. Under this Section, as revised and reactivated by the Housing and Community Development Act of 1974, construction and permanent financing loans are given for the development of housing for the elderly and handicapped. Interest is based on the average rate paid on Federal. obligations during the preceding year, with a surcharge for administrativ. costs. By regulation, sponsors are limited to non-profit organizations. Since this relatively small reduction of interest does not permit much reduction of rents, HUD couples this loan assistance with _a reservation of Section 8 subsidy for all units. Because of financing problems when HUD made CRS- 5 IB79058 UPDATE-07/20/82 only permanent loans without construction financing, as well as some administrative problems, construction was slow in getting under way. only 400 units were completed in FY78. Completions had increased to 28,000 units ‘uring FY81, but only 18,000 units were started. Section 515. FmHA conducts a rental subsidy program, under which loans are made to appropriate sponsors at subsidized rates, which can reduce the mortgage interest rate to as low as one percent. In addition, it has made a cooperative agreement with HUD to provide Section 8 assistance to 10,000 Section 515 units each year, and it is now activating its own rental assistance program which is akin to Section 8 for other eligible tenants. Loans are made for both low- and moderate-income families, with interest rates reduced by varying amounts. Since its inception in 1970 through FY80, approximately 225,000 units have been financed. Section 236. New commitments under Section 236 ended in 1973, but production has continued to a very limited degree based on bona fide commitments made prior to the moratorium. Altogether, approximately 600,000 units have been produced, of which about 50,000 were substantially rehabilitated existing units rather than_ new construction. Those under contract will of course continue to receive the mortgage subsidy until termination of the contract, which usually extended 30 to 40 years. Since the subsidy has served only to reduce mortgage payments, rapidly increasing operating costs, together with relatively static tenant incomes and consequently rent payments, have resulted in a high degree of financial distress in many of the projects. This difficulty has been aggravated by large vacancy rates in some projects resulting from their poor location or a method of calculating minimum rent payments which has seriously restricted the number of eligible families from which tenants could be drawn. Approximately a tenth of the units are in projects whose mortgages have been assigned to HUD or which HUD has acquired by foreclosure. The 1974 Housing and Community Development Act provided for limited HUD assistance with increased taxes and utility costs, but this provision was activated only by law suits and has been of minor assistance. The Housing and Community Development Amendments of l978 again attempted to deal with this problem by authorizing HUD expenditures for assistance to "troubled projects" built under Section 236 or other subsidy programs. For FY80, $82 million was appropriated for this rescue operation, with $18 million added in FY81. Home-owners: Sectionsi235 and 502 Assistance to potential lower-income home-owners is limited to that given under Section 235 by HUD or Section 502 by FmHA. Section 235, which had been suspended in the l973 moratorium, was reactivated in revised form in FY76. It is however, again being eliminated by the 1981 authorization act. When it was reactivated, in an effort to ameliorate the high rate of foreclosure which afflicted the original program, ndown-payment requirements were substantially increased and the subsidy decreased so as to reduce mortgage interest to an effective 5%. Although Congress extended the program, no additional funding was authorized, until a limited amount in FY81 to meet an over-commitment, and commitments were made from the balance of previously authorized funds. These approximated $109 million at the end of FY80. Eligible households have incomes of up to 95% of the area median, adjusted for family size, and pay at least 20% of income for mortgage payments, taxes, and insurance. only 3,400 units were started in the revised program through FY77, and mortgage limits were raised and the subsidy increased to lower the interest to an effective 4% in an effort to promote its use. Approximately CRS- 6 IB79058 UPDATE-07/20/82 8,500 eligible units were started in FY79, well below HUD's projected 15,000. There were about 14,700 sales completed under the program in the fiscal year, of which 1,200 were substantially rehabilitated homes and the rest newly constructed. The 1979 amendments permit 20% higher mortgage limits revitalization areas, if such action enables families who occupy substandard housing or who are being involuntarily displaced to remain in the area. Largely as a result of the slow—down in unassisted home-building as interest rates reached extremely high levels and mortgage funds dried up, commitments in FY80 far exceeded expectations. By Sept. 30, 36,000 firm commitments had _b_e .€_1’1 li._S§ S ‘L1_€;i-is TLLG ELQES ,i,I1;9 -,§}I1S_1 C9 IILII11l.I1;;i£Y..,. i§D;_e Ell QP WEI1 ‘L , A 913- ._ .Q,f_,-, l 9&9 __ ,a,d_d.e_d_ 3» provision for partial recapture of the subsidy, applicable to homes sold pursuant to commitments issued later than 6 months after the enactment of the Act; upon sale of the house, the mortgagor is to repay to HUD the lesser of the actual amount of subsidy received or at least 50% of the net appreciation. when home—building began to slow in early spring of 1980, and severe budget restraints limited the possibility of new stimulative programs to assist the industry, proposals were made to use the already appropriated, but then little-used, Section 235 funds for a revised Section 235 program that would be directed toward higher priced homes and somewhat higher-income families than those eligible for the standard program. The Housing and Community Development Act of 1980 authorizes expenditure of 75% of remaining funds for a re-directed program, upon a finding by the HUD Secretary that there is emergency need for stimulation of the housing market. Assistance is limited to families with incomes under 130% of median in the area, the sales price cannot exceed 82% of the maximum mortgage that can be insured under Section 203 (b)(2), and the interest rate is reduced to not less than 9 l/2% or, for mobile homes, 12%. Homes must have been completed within one yes prior to enactment of the Act and must never have been sold. Recapture is provided as in the standard program. At the time the stimulative program was conceived it was expected some 100,000 units would be insured under it. Following the spurt in use of Section 235 referred to in the paragraph above, a deficiency of funds developed for approved construction in the "regular" program. Consequently, $70,000,000 in contract authority was appropriated for section 235 in the FY81 appropriation act, none of which was to be used for the stimulative program. The 1981 authorization act prohibits new contracts after March 1982, except pursuant to firm commitments made prior to that date, and any contract after Sept. 30, 1983. HUD has attempted to stretch use of the funds by keeping the subsidy amount per unit constant as the FHA maximum interest rate increased and consequently, the mortgage interest rate currently is written down to 8%, rather than 4%. As of Sept._ 1, funds remain for approximately 3,200 units. Under Section 502, FmHA provides "interest credit" loans to low-income families in rural areas, including_towns of up to 20,000 population outside of metropolitan areas, as well as to moderate income families at higher interest rates. For low-income households, the rate can be as low as one percent. The Housing and Community Development Amendments of 1978 authorized a further deep subsidy for families too poor to afford even a one percent loan, under which FmHA pays the difference between 25% of the family's income and home-ownership costs. Moderate-income borrowers pay a rate based on FmHA's borrowing cost. In FY79, 111,200 loans were obligated for purchase and repairs and 51,800 units were completed, of which 20,000 receive interest credit loans. THE CURRENT SITUATION CRS- 7 IB79058 UPDATE-O7/20/82 within the 97th Congress, interest has focussed on efforts to limit ~xpenditures for housing assistance, both through a reduction in the number of units added to the assisted stock and by lowering the subsidy attached to an individual unit. In response to Administration request, Congress rescinded $5.2 billion in budget authority for FY81 for public housing and Section 8 units, reducing the number of additional units to 210,000 instead of the previously authorized 255,000. The Administration request for FY82 was 175,000 units, instead of the Carter budget of 260,000. The First Budget Resolution adopted by the Congress instructed the Banking Committees to authorize expenditures based on an estimated 162,500 units, a compromise between the House resolution which assumed 175,000 units and the Senate resolution which assumed 150,000 units. The Reconciliation bill further reduced this to an amount expected to finance 152,000 units. The authorization bill, the Housing and Community Development Amendments of 1981, is included in the Omnibus Budget Reconciliation Act of 1981, as Title III. It divides the authorized funds so as to subsidize 55% existing units and 45% new construction and substantial rehabilitation. In an effort to reduce future outlays, the bill also standardizes the definitions of gross and adjusted income among the various housing assistance programs, and raises the tenant payment in all programs from 15% to 25% of adjusted income to 30%, to be phased in over a five-year period. Minimum payment was set at 10% of gross income in both the public housing program and Section 8. In an effort to reduce unit costs, particularly for new construction in Section 8, requirements for "modest" quality were strengthened. Eligibility is kept at 80% of median, but sharply limits occupancy by those between 50% and 80% of median. This move could increase outlays in the short run, but both targets assistance to the lowest-income families and reduces what some see as an incentive for developers to build to more than minimal quality standards and to provide unnecessary amenities. ‘ Those in favor of these changes point to the impossibility of giving housing assistance to all those currently eligible, particularly in a period of fiscal restraint, and hence the desirability of targeting assistance to the most needy through lower income limits for eligibility and lower quality housing which would be both less expensive and less attractive to higher income families. Those opposed to the changes express concern that the apparent lessons learned from the concentration of very low income families in public housing, relating to aggravated social and managerial problems and community inacceptability, should not be disregarded. The appropriations act for FY82 provided $897.2 million in contract authority, estimated to support an additional 144,000 families. The Urgent Supplemental Appropriation Act, FY82, however, rescinds $94.4 million of this. In reporting H.R. 6682, a predecessor bill to H.R. 6685 which was finally passed and signed by the President, Sen. Garn presented a table that showed a program level of 150,700 units, minus 44,100 units to be lost by deobligation, for a net level of 106,600. of these, 65,000 were conversions from Section_23 and rent supplement units, for a net gain of 41,600 assisted households. (Congressional Record, June 24, 1982, p. S7482.) The provisions of the Act are reported below in the Legislation Section. FY83 Budget Proposals. The FY83 budget proposals contain a sharp change in both the nature and dimension of housing assistance. A "modified certificate" program is proposed to replace Section 8, similar to Section CRS- 8 IB79058 UPDATE-07/20/82 8-Existing, but with the subsidy for a particular household and unit set at the beginning of a five-year period and not adjusted thereafter for rent increases. Family rent payments of 30% of income would be assumed “a calculating the subsidy amount, but actual rent payments made by the fami_y could be more or less. A "rental rehabilitation" program is also proposed to replace Section 8-moderate rehabilitation and Section 312 rehabilitation loans. There would be 110 new construction Of substantial rehabilitation program, ilexcept.“form.l0,000_lunitsl_ofllSection_l2Dzllhohsingllforllthel_elderlyl_and handicapped, which would also carry Section 8 assistance. A total of 111,600 modified certificates is proposed, of which 30,000 would apply to the rental rehabilitation units, 60,600 would be for families in Section 8-existing units who would shift to certificates, 1,000 for tenants of Section 8=new construction units whose owners fail to renew the initial five-year contract, and 5,000 for tenants in public housing units to be demolished. The ~rest would be used for conversions of Section 23 leased units, and for loan management-property disposition assistance for troubled FHA-insured projects. The Office of Management and Budget (OMB) has published a proposal to rescind $9.4 billion of budget authority and $334.7 million in contract authority appropriated for FY82 but not yet committed. The number of Section 8~new construction and substantially rehabilitated units would be cut from an estimated 65,000 units to 22,800, of which 16,900 would be associated with Section 202; there would be 192,000 Section 8-existing units of which 178,000 would be reserved for conversion of rent supplement units over the next three years. The FY82 appropriation was estimated to support about 79,000 Section 8-existing units, primarily additions to "the numbers already subsidized rather than primarily for continuation of assistance to families or units nc subsidized under other programs. The net addition to the subsidized housing inventory from the FY82 budget had been estimated at 117,000 units by FY87. Under the proposed rescission, OMB estimates the net increment would be 36,000 units. These proposals for rescissions are currently before Congress in greatly modified form in the Urgent Supplemental Appropriations bill. one version of this has passed the House; a second version has not yet passed the Senate. Appropriations for public housing operating subsidies for FY82 are reported at $1.152 billion, reflecting exclusion of $7.4 million subtracted because of the general 4% reduction ‘required by the FY82 HUD-Independent Agencies Appropriation Act. An appropriation of $1.075 billion is requested for FY83. The lower amount is explained by reliance on higher tenant rent payments because of the increase in rent-income ratios and a proposed inclusion of the value of food stamps in tenants‘ adjusted income, as well as reduced operating costs because of expected improvements in management and savings from improved energy efficiency. The authorization bill currently before the House includes an authorization of $1.6 billion for FY83, and that before the Senate, $4.25 billion for FY82 to FY84. The Senate -bill also changes the method of providing operating assistance, establishing a division between troubled authorities and those not in excessive difficulty. Public housing modernization (Comprehensive Improvement Assistance Program) would continue at a level of $1.8 billion budget authority each year in FY82 and FY83. However, rescission is requested by OMB of $75 million in contract authority for modernization. Budget authority is expected to be derivet primarily from a" shifting of funds from development of new units to modernization of already existing ones. No additional funds are requested for Section 235 or Section 236 CRS- 9 IB79058 UPDATE-07/20/82 assistance, and rent supplement funds are to be rescinded as units are shifted to the new certificate program. ISSUES The issues which have been addressed in the debate over the authorization bills in the past several years continue to be of concern for the future, but with the focus upon the proposals contained in the FY83 budget. Thus, questions relating to the cost of housing assistance and the use of the existing stock vs. reliance on new construction have narrowed to the specific questions of whether to adopt the proposed reliance on a rent certificate program and abandonment of all new construction for subsidized housing (except a small number of units for the elderly). subsumed in this question is whether to accept the proposed number of certificates and the proposal to use them almost entirely to substitute for assistance to families already aided by other programs instead of increasing the number of assisted households. There are also questions as to the amount of assistance to be given to each family, and whether food stamps should be included in adjusted income in determining tenants‘ expected rent payments. Finally, with respect to the existing stock of public housing, there are questions relating to the level of operating subsidies and modernization funds, the effect of changed definitions of income and eligibility on the income characteristics of tenants and on the management problems and rent receipts of the projects. H.R. 6020 and S.236l, incorporating the Administration's proposals on these issues were introduced on March 31 and Apr. 13, 1982, respectively, and referred to the Banking Committee of each House. The House and Senate each has before it substantially different bills, H.R. 6296 and S. 2607. These bills are described below in the Legislation Section. LEGISLATION P.L. 97-35, H.R. 3982 Housing and Community Development Amendments of 1981. (Title III of Omnibus Budget Reconciliation Act of 1981) Passed by House and Senate, July 31, 1981. Signed by the President on Aug. 13, 1981. Authorizes $907 million in annual contracts authority and $l8.087 billion in budget authority for FY82 for public housing and Section 8; 45% of funds are to be expended for existing units and 55% for new construction and substantial rehabilitation (for an expected 55%-45% division of units); $75 million of contract authority is for the public housing comprehensive improvement program. Public housing operating subsidies are authorized at $1.5 billion for FY82. The Secretary's discretionary fund is limited to 15%, to be used for specified purposes. $4 million is authorized for troubled projects, and $850.8 million for Section 202 loans. For Farmers Home (FmHA) programs, a total of $3.7 billion is authorized for all insured and guaranteed loans, of which $3.17 billion is for home-owner loans with interest credit and none for those without assistance; $50 million for Sec. 504 low-income home repair loans and grants, with not more than $25 million for grants; $398 million for Sec. 521 rental assistance payments, and $25 million for farm labor housing grants. CRS-l0 IB79058 UPDATE—O7/20/82 Sections of the United States Housing Act of .1937 defining income, eligibility, and rental assistance for the assisted housing programs are amended to provide uniform definitions and, for the most part, uniform rentcl payments in all programs for families with the same income. Income 3 defined as income from all sources of each member of the family, as determined by HUD; adjusted income refers to income remaining after -exclusions determined by HUD, considering minor children and other appropriate factors. Assistance is restricted to citizens and aliens who are lawfully admitted for permanent residence. Rent payments are set at 30% of ladjusted income, except that a minimum payment is established of 10% of gross income in public housing and Section 8, or, for families receiving welfare, the amount specifically designated for rent by the welfare agency, if higher; of 30% of market rent in rent supplement units; and the basic rent or 30% of adjusted income, whichever is higher, in Section 236 units. The higher rent-income ratios are to be phased in over 5 years for current tenants, with no tenant having an increase of more than 10% in his rent payment in any 12-month period, except for increases resulting from higher income. No rent payment is to be lowered because of these changes. New tenants are to pay the higher rents immediately unless the Secretary determines this would create undue hardship or too great managerial costs in administering two rent schedules. HUD determinations and actions under these provisions are not reviewable in any court. In the public housing program, all references to "low—income" are changed to "lower income." In Section 8, lower cost is encouraged by procedural changes governing permissible rent increases duringi construction and after occupancy begins and by giving preference to proposed projects located on land provided by States or local governments. In both public housing and Section 8, assistance is targeted to lowestnincome families 1 restricting occupancy by those with incomes between 50% and 80% of median income to not more than 10% of already subsidized units being re-rented and to not more than 5% of units for which assistance is contracted after passage ‘of this Act. Newly constructed and substantially rehabilitated Section 8 projects in which not all units are subsidized are required to make the contract number of units available at all times to eligible families. Families in rented manufactured homes, as well as those occupying owned homes on rented sites, are made eligible for Section 8 assistance, for the rental portion of their housing cost. Single-room-occupancy units lacking private kitchens and bathrooms in rehabilitated structures are eligible for assistance under certain circumstances. Authority to enter into Section 235 contracts is limited after Mar. 31, 1982, to homes for which firm commitments have been issued prior to that date, and completely ended after Sept. 30, 1983. The Secretary of Agriculture is instructed to report by Mar. 31, 1982, on definitions of low income which will target FmHA programs to a population equivalent to those receiving HUD assistance; on the effects of requiring that 30% of FmHA assistance go to families with incomes below 50% of median; and on means of achieving equity between housing payments made by those assisted by FmHA and HUD. P.L. 97-101, H.R. 4034 Housing and Urban Development -- Independent Agencies Appropriation Act_ 1982. Appropriates $897.2 million for annual contract authority for Section 8 and public housing, of which $25.1 million is for Indian housing and $75 million for modernization of public housing projects. Associated budget authority is set at $l7.374 billion. Makes available $15 million contract CRS-ll IB79058 UPDATE-O7/20/82 authority and $300 million budget authority for modernization of public housing projects which was deferred from obligation in the Supplemental Appropriation and Rescission Act, 1981 (P.L. 97-12). Rescinds not more than 30.5 million in uncommitted authorizations provided for rent supplement contracts. Appropriates $830.8 million for Section 202 housing for the elderly, available only to non-profit sponsors. Loans and receipts in the fund are to be included in the Budget. Appropriates $1.298 billion for operating subsidies for pubic housing projects, consisting of $148 million to make up for a shortfall in FY81 funding and $1.156 billion for FY82. Four million dollars are appropriated for assistance to troubled multi-family projects. $1.973 billion are made available for GNMA mortgage purchases under its special assistance function. No funds are appropriated for Section 312 rehabilitation, but authorization is given for making loans from payments into the fund and unexpended balances of prior appropriations. Passed the House, July 21, 1981. Passed by Senate, with amendments, July 30, 1981. Conference Committee report submitted to House, Sept. 11, and accepted Sept. 15, 1981. Accepted by the Senate with amendments, Nov. 21, 1981. House concurred in Senate amendments, Dec. 10, 1981. Signed by the President on Dec. 23, 1981. P.L. 97-216, H.R. 6685 Urgent Supplemental Appropriations Act, 1982. Chapter II of this Act rescinds $94.8 million of contract authority and $4.098 billion of budget authority for assisted housing, and $3.3 million of rent supplement funds. Of these appropriations, $190.86 million of contract authority (ACC) and $4.1 billion of budget authority are to be used for public housing, including Indian housing ($19.0 million), modernization ($90 million ACC) and new construction and substantial rehabilitation ($1.3 billion budget authority). $871.0 million in contract authority and $15.2 billion of budget authority is appropriated for all forms of Section 8 assistance. Provision is made ‘for $152.7 million of contract authority and $3.7 billion of budget authority to‘ be used for Section 8 projects making use of the financial adjustment factor (FAF) in setting fair market rents. Of the appropriated amounts, $74.4 million of contract authority and $1.75 billion of budget authority shall become available until FY83, unless recapture of deobligated budget authority available for FAF use does not equal $5 billion. Two predecessor bills (H.R. 5922 and H.R. 6682) vetoed by President. H.R. 6685 passed House, June 24, 1982; passed Senate, June 29, 1982; Conference report filed in House and Senate, July 14, 1982; passed House and Senate, July 15; signed by President July 18, 1982. H.R. 6296 (Gonzales) Housing and Urban—Rural Recovery Act of 1982. Authorizes $840 million in annual contracts authority (ACC) and $16.0 billion in budget authority for public housing and Section 8 for FY83. At least $85 million of the ACC is to be used for public housing modernization and not more than $173.5 million for conversion of units assisted under other programs to Section 8. After deducting these amounts, together with funds needed for amendments to contracts and for conversion of some units under Section 8 new construction and substantial rehabilitation to Section 8-existing, the remainder shall be divided not more than 38.6% to Section 8-existing and not more than 61.4% to new construction and substantial rehabilitation. 0f the 61.4%, at least $102.9 million shall be for conventional public housing. Public housing authorities may use these funds for operating costs as well as development. $1.6 billion_ is authorized for operating subsidies. If the amount appropriated is not enough to make full payments according to established CRS-l2 IB79058 UPDATE—07/20/82 formula, the revision of amounts paid shall be considered subject to all rule-making requirements. Additional authorizations programs include $32 million for troubled multifamily projects; million for Section 202 for elderly and handicapped; $10 million congregate housing; $5.5 million for Section 312 rehabilitation loans, which at least 60% shall be used for l-to-4 family houses; $l8.5 million for the Neighborhood Reinvestment Corporation of which $3 million is for a demonstration program on mutual housing; and $36.7 million in contract authority and $1.1 billion in budget authority for regular Section 235 rulemaking and for HUD $843 f;; Of ‘V. .hQmB:ONflB£BhiP assistanceiEor_EmHA_pnognamsiiauthonizesi$3i100i6imillioni.for rural housing loans, $3,670 million of which shall be made available to borrowers receiving interest credits; $940 million for rural rental and cooperative housing loans; $2 million for technical assistance grants of which 50% shall be used for counseling purchasers and delinquent borrowers and 50% shall be used for outreach in developing farm labor housing; authorizes $398 million for rental assistance payments, $l73 million of which shall be for tenants in new or substantially rehabilitated rural rental, cooperative, and farm labor housing; $15 million for mutual and self=help housing projects. The bill also changes the required rental payment made by tenants receiving rental assistance in FmHA programs so that it is the same as for those receiving assistance through HUD programs. Provides that only the need for domestic farm labor housing in an area will be considered when determining whether to provide such housing, be considered. and other housing needs will not 10 to to iv Section 235 (q) is amended to reduce the subsidy term to establish a revolving fund from recaptured subsidy moneys appropriations) to use to extend the subsidy past 10 years if individual cases. ° years, (subject necessary Authorization for the total of outstanding commitments and purchases GNMA is increased by $1.2 billion and GNMA is required, subject only to limitation of applications and appropriations, to enter into commitments to purchase mortgages in FY83 with an aggregate principal amount of $1.973 billion. DY A new single-family production program is established in a cited as the "Single-Family Housing Production Act of 1982." It provides for writing down mortgage interest rates by 6 percentage points for mortgagors with incomes under 115% of median (or by 4 points for those with higher incomes), or to 9 l/2%, whichever is higher. The mortgagor must pay at least 25% of income for mortgage interest, principal, and premiums for mortgage insurance. Authority is given for payments of up to $600 million per year, with an aggregate obligation over the life of the contracts of not over $3.5 billion. No commitments are to be made under this authority after Sept. 30, 1983. part to be A new multifamily housing production program is established, with authorized funding level of $1.3 billion, subject to appropriation to cited as the "Rental Housing Production and Rehabilitation Act of 1982." purpose is to increase the stock of rental and cooperative housing and to reduce costs to residents. Assistance is to be targeted to areas with a severe shortage of rental housing. States and local governments their agencies are to receive assistance, to be used to lower the costs of’ net construction or rehabilitation undertaken by private developers, through capital grants, loans, interest reduction payments, or other suitable means chosen by the locality. The developer must agree to pass on the lower costs to tenants as lower rent, and to rent at least 20% of the units to families an be Its OI‘ CRS-13 IB79058 UPDATE-07/20/82 with incomes below 80% of median. A demonstration project is established, with an authorization of $25 million in FY83, to provide grants to States and local governments for programs to improve the housing of families receiving ublic assistance. Adopted by Banking Committee on May 11, 1982, and reported to the House on May 17, 1982. S. 2607 (Banking Committee bill) Housing and Community Development Amendments of 1982. Authorization is provided for annual contributions contracts for public housing and Section 8, of not more than $582.2 million for FY83; for budget authority, not more than $7,222.730 million, including balances which become available and appropriations. Not more than $301.43 million in contract authority may be used for Section 8 -- Existing units; $l44.212 million for newly constructed or substantially rehabilitated units; $106.0 million for public housing, including modernization funds. Authority for new construction and substantial rehabilitation of units under the public housing and Section 8 programs is repealed except with respect to units financed under the Section 202 program. - Operating subsidies are authorized at $4.250 billion for FY82 -- FY84, of which $50 million per year is for "Tier B" agencies. Agencies shall be classified as Tier A or Tier B on the basis of management capability, etc. Tier A agencies shall get 3-year contracts, based on a formula allocation. Tier B agencies receive assistance subject to efforts to improve management, etc. A modified Section 8 -- Existing Certificate program is adopted under which a "payment standard" is established for units of different sizes and types, and families receive assistance in the amount by which the appropriate payment standard exceeds the greater of 30% of adjusted income, 10% of gross income, or the portion of welfare payment designated for rent (or 30% of the payment if a rent amount is not designated). only a very low income family or one previously assisted under the U.S. Housing Act of 1937 shall. receive such assistance. The amount of payment may be adjusted twice in any five-year period. (Funding authorized as part of housing assistance.) For housing for elderly and handicapped, up to $790.290 million in loans is authorized for FY83, for a maximum of 15,000 units, at an interest rate of not more than 9%. Authorization is given for $10 million in FY83, $11 million in FY84, and $12 million in FY85 for congregate services. For rural housing, authority to make grants to low-income home-purchasers is repealed; authority to sell notes to the Treasury for loan funds is repealed; insurance of loans at 1% interest for housing farm labor on Indian tribes is repealed; limits on interest for Section 515 loans for rental housing are repealed. Interest on loans, to or on behalf of rental housing for low and moderate income households shall be at private market rates and no contract for interest credit'or other assistance may be entered into after this Act. Under assisted contracts entered into before this Act, the recipient's rent or contribution shall be 30% of income. Insurance and guarantee of loans under the amended provisions are authorized in an aggregate amount of $895 million, allocated among the various programs. A Rural Housing Block Grant program is established, primarily .for- very low income residents (under 50% of median income) of places with population under 2,500, places between 2,500 and 10,000 which are rural in character, or place between 10,000 and 20,000 which are rural and with a serious lack of mortgage credit. $850 million is authorized for FY83 for grants to States to carry on activities for rehabilitation of existing structures, construction, or purchase of modest homes, provision of rental housing or of rental CRS-14 IB79058 UPDATE=O7/20/82 assistance, for the benefit of very low income persons. A recipient State shall provide at least 10% of the amount it receives for housing activities. Funds allocated to a State under the distribution formula but not accepted ’v it shall be given to the FmHA State office for use in the program. A new program is established to promote rehabilitation and construction of privately-owned residential property. At least 80% of initial rents of rehabilitated units are to be lower than the payment standard for Section 8 modified certificate program. Rehabilitation assistance shall not exceed 50% i/iofitotalicost..1lninewuconstruction+_atileastizssiofiunitsisha11ibe_.occupied or available to very low income persons and families. Secretary may make Section 8 assistance available to those displaced and to the rehabilitated units. (Households pay not more than rent they would have to pay if they received assistance under public housing or Section 8.) Authorization is for not more than $300 million of total appropriated for Community Development Block Grants for FY83, of which not less than $30 million or 10%, whichever is less, shall be for innovative programs and special needs, and not less than $1 million for technical assistance for rehabilitation activities. Accepted by Banking Committee, May 6, 1982. Reported to Senate, May 28, 1982. HEARINGS U.S. Congress. House. Appropriations Committee. Subcommittee on HUD-Independent Agencies. Hearings on HUD appropriations, Apr. 3-5, 1979. —--—- Committee on Banking, Finance and Urban Affairs. Subcommittee on Housing and Community Development. Hearings on FY82 HUD Budget. March 18, 19, and 24, 1981. ----- Hearings on Housing and Urban-Rural Recovery Act of 1982. Part 1, March 16 and 17, Part 2 March 18 and 23, Part 3, March 24 and 25, 1982. -—-—- Hearings on Housing and Community Development Amendments of 1980. Part 1, March 3e4, 1980; Part 2, March 5-7, 1980. ----- Hearings on Housing and Community Development Amendments of 1979. Part 1. Mar. 26=29, 1979; Part 2, March 30 and April 10, 1979. ----- Select Committee on Aging. Subcommittee.on Housing and Consumer Interests. Oversight hearings on housing programs. Apr. 10, Apr. 30, 1979. U.S. Congress. Senate. Appropriations Committee. Subcommittee on HUD-Independent Agencies. Hearings on HUD appropriations, Apr. 26, May 2-3, 1979. ----- Committee on Banking, Housing, and Urban Affairs. Subcommittee on Housing and Urban Affairs. Hearings on Housing Authorization Legislation. April 10, 24 and May 1, 1979. ----- Hearings on Housing and Community Development Act of 1980. March 25, and 26, April 2 and 29, 1980. CRS-15 IB79058 UPDATE-07/20/82 ----- Hearings on Housing and Community Development Amendments of 1981. April 21-24, 1981. REPORTS AND CONGRESSIONAL DOCUMENTS House Report, H.R. 5922 (Conference Report) Report no. 97-605, June 10, 1982. House Report, H.R. 6296, Report no. 97-532, May 17, 1982. Senate Report, S. 2607, Report no. 97-463, May 28, 1982. House Report, H.R. 4034 (Conference Report) Report no. 97-22, Sept. 11, 1981. House Report, H.R. 4034, Report no. 97-162. June 25, 1981. House Report, H.R. 3512 (Conference Report). Report no. 97-124, June 3, 1981. House Report, H.R. 3400. Report no. 97-29. May 4, 1981. House Report, S. 2719. Report no. 96-1420, Sept. 26, 1980 House Report, H.R. 7631. Report no. 96-1114. June 19, 1980. House Report, H.R. 7262, Report no. 96-979, May 15, 1980. House Supplemental Report, H.R. 7262, Report no. 96-979, Part II, May 19, 1980. House Supplemental Report H.R. 7262, Report no. 96-979 Part III, May 29, 1980. 2 Senate Report, H.R. 7631, Report no. 96-926, Sept. 4, 1980. Senate Report , S. 2719, Report no. 96-736, May 15, 1980. Senate Report, S. 2177, Report no. 96-650, April 2, 1980. CHRONOLOGY OF EVENTS 07/18/82 -- Urgent Supplemental Appropriations Act, 1982 (H.R. 6685) signed into law. 07/15/82 -- H.R. 6685 passed by House and Senate. 07/14/82 -- Conference report on H.R. 6685 filed in House and Senate. 07/13/82 -- H.R. 6685. Motion to override veto fails in House. 06/29/82 -- H.R. 6685 passed by Senate with amendments. 06/25/82 -- H.R. 6685 vetoed by President. 06/24/82 -- H.R. 6685 passed Senate and House. -- H.R. 5922 vetoed by President and motion to override rejected by House. 06/23/82 -- House concurred in Senate amendments to H.R. 5922. 06/22/82 -- Senate disagreed to House amendments to H.R. 5922. 06/21/82 -- Senate agreed to conference report on H.R. 5922. 06/16/82 -- House agreed to conference report on H.R. 5922. 05/28/82 05/27/82 05/17/82 05/12/82 05/11/82 05/05/82 04/13/82 03/31/82 03/04/82 12/23/81 12/10/81 11/21/81 09/15/81 09/11/81 08/13/81 07/31/81 07/30/81 CR3-l6 IB79058 UPDATE=O7/20/82 Housing and Community Development Amendments of 1982 (S. 2607) reported to Senate by Banking Committee. HIRO Urgent Supplementary Appropriation Act, 5922, passed Senate. Housing and Urban-Rural Recovery Act of 1982 (H.R. 6296) reported to House by Banking Committee. Urgent Supplementary Appropriation Act, H.R. 5922, passed House. Housing and Urban-Rural Recovery Act of 1982 (H.R. 6296). passed by Banking Committee in place of H.R. 5731. Housing and Community Development Amendments of 1982 (S. 2607) passed by Committee on Banking, Housing, and Urban Affairs in place of S. 236. Housing and Community Development Amendments of 1982 (S. 236) introduced in Senate; referred to Banking, Housing, and Urban Affairs Committee. Housing and (H.R. 6020) Finance and Community Development Amendments of 1982 introduced in House; referred to Banking, Urban Affairs Committee.. Housing and Community Development Amendments of 1982 (H.R. 5731) introduced in House; referred to Banking, Finance, and Urban Affairs Committee. 97-101) HUD Appropriations Act (P.L. signed by the President. House concurred in Senate amendments, and bill (H.R. 4034) sent to President for signing. HUD Independent Agencies Appropriation conference report (H.R. 4034) was accepted by the Senate with amendments and returned to House. A HUD-Independent Agencies Appropriation (H.R. 4034) was accepted by House. Conferences Report Conference Report on HUD-Indendent Agencies Appropriation Act (H.R. 4034) was submitted to House. Omnibus Budget Reconciliation Act (P.L. 97-35) signed by the President. Conference report on Budget Reconciliation Act (H.R. 3982) submitted to Senate and adopted. Conference report on Budget Reconciliation Act (H.R. 3982) accepted by House. HUD-Independent Agencies Appropriation Act 07/29/81 07/21/81 07/13/81 06/26/81 06/12/81 06/05/81 06/04/81 06/03/81 12/15/80 12/03/80 12/02/80 11/21/80 10/08/80 09/30/80 09/23/80 09/04/80 :08/22/80 07/28/80 cns-17 IB79058 UPDATE-O7/20/82 (H.R. 4034) passed by Senate and referred to Conference Committee . Conference report on Budget Reconciliation Act (H.R. 3982) filed in House. HUD-Independent Agencies Appropriation Act (H.R. 4034) passed by House. Budget Reconciliation Act (H.R. 3982), containing Housing and Community Development Amendments of 1981 as its Title III, passed by Senate. Budget Reconciliation Act (H.R. 3982), containing Housing and Community Development Amendments of 1981 as Title III, passed by House. House Banking Committee refers "Housing and Community Development Amendments of 1981" to Budget Committee as part of budget reconciliation package. Supplemental Appropriations and Rescission bill (P.L. 97-12) signed by President. Conference report on Supplemental Appropriations and Rescission bill (H.R. 3512) adopted by House and Senate. Housing and Community Development Amendments of 1981 (S. 1197) adopted by Senate. HUD-Independent Agencies Appropriation Act (P.L. 96-526) signed by President. ' Conference Report on HUD-Independent Agencies Appropriations Act (H.R. 7631) accepted by Senate. Confernce Report on H.R. 7631 accepted by House. Conference report on H.R. 7631 submitted to House. Housing and Community Development Act of 1980 (P.L. 96=399) signed by President. Conference report on Housing and Community Development Act of 1980 (S. 2719) agreed to by House and Senate. HUD-Independent Agencies Appropriation Act for FY1981 (H.R. 7631) adopted by Senate. Referred to conference. HUD-Independent Agencies Appropriation Act for FY1981 reported to Senate by Appropriations Committee. Housing and Community Development Act of 1980 (H.R. 7262) adopted by the House as an amendment to S. 2719. HUD-Independent Agencies Appropriation Act for FY1981 (H.R. 7631) adopted by House. 06/21/80 06/19/80 05/15/80 05/07/80 05/05/80 04/22/80 04/02/80 03/05/80 02/25/80 12/21/79 12/19/79 12/08/79 07/13/79 06/07/79 10/31/78 10/17/75 08/22/74 CRS-18 IB79058 UPDATE=07/20/82 Housing and Community Development Act of 1980 (S. 2719) adopted by Senate. HUD-Independent Agencies Appropriation Act for FY1981 (H.R. 7631) reported to House by Appropriations Committee. Housing and Community Development Act of 1980, (H.R; 7262) reported to House by Banking Committee Housingmandmcommunity.Deve1opmentmAct1o£1l980-(S-12119)_iw, reported to Senate by Banking Committee Senate Banking Committee ordered to be reported an original measure in lieu of S. 2383 (S. 2719) Housing Subcommittee refers H.R. 7262 to Banking Committee in lieu of H.R. 6606. Emergency Home Purchase Assistance Authority Amendments of 1980 (S. 2177) passed by Senate S. 2177 reported to Senate by Banking Committee S. 2383 (Williams, by request) introduced and referred to Banking Committee H.R. 6606 (Ashley, by request) introduced and referred to Banking Committee Housing and Community Development Amendments of 1979 (P.L. 96-153) signed by President. Conference Report on Housing and Community Development Amendments of 1979 (H.R. 3875) adopted by House. Conference Report on H.R. 3875 adopted by Senate. Housing and Community Development Amendments of 1979 (S. 1149) adopted by Senate as amendment to HORO Housing and Community Development Amendments of 1979 (H.R. 3875) approved by House. Section 8 extended and a new moderaterehabilitation program incorporated into the existing housing program, in The Housing and Community Development Amendments of 1978 (P.L. 95-557). HUD announced the release of $264 million in funds available for the Section 235 home-ownership subsidy program for moderate-income families, under revised terms. The Section 8 leased housing program was established as the primary method for subsidizing housing for low- and moderate-income families and the conventional public housing and Section 202 loan program for housing for the elderly and handicapped were re-instituted through 01/08/73 -- 12/31/70 -- l2/24/69 -- 08/01/68 -- ll/O4/66 -- 09/09/65 -- 08/10/65 -- 09/02/64 -- 06/30/61 -- CRS-19 IB79058 UPDATE-07/20/82 signing of the Housing and Community Development Act of 1974 (P.L. 93-383). Outgoing Secretary of HUD, George Romney, announced an 18-month moratorium on new commitments for subsidized housing programs, effective as of the close of business January 5; appropriations and approved contract authority for these programs were impounded. Operating subsidies for low-rent public housing authorities without limitation t0 special classes Of tenants were approved, and the Experimental Housing Allowances Program was authorized in the Housing and Urban Development ACt Of 1970 (P.L. 91-609). ' The "Brooke Amendment" in the Housing and Urban Development Act of 1969 (P.L. 91-152) limited rent payments by tenants in public housing to one—fourth of their income. The and national housing goal enunciated in 1949 was reaffirmed the President required to report on a 10-year goal for its achievement in the Housing and Urban Development Act of 1968 (P.L. 90-448). In support of this goal, new assistance programs for home-ownership (Section 235) and for rental housing (Section 236) were established. Section 221 to the sale below market interest rate loans were extended of rehabilitated housing to low-income families in the Demonstration cities and Metropolitan Development Act of 1966 (P.L. 85-754), which authorized the Model Cities program. The Department of Housing and Urban Development Act (P.L. 89-174) established a new cabinet level Department of Housing and Urban Development primarily from the agencies which had made up the Housing and Home Finance Agency, including the Public Housing Administration. Leasing of units in existing buildings by public housing agencies for subleasing to low-income families and a new rent supplement program providing rental assistance in privately owned structures to particular classes of low-income families were authorized in the Housing Act of 1965 (P.L. 89-117). A program (Section 312) for direct loans at a 3 percent interest rate for rehabilitation of homes or business in urban renewal areas was authorized in the Housing Act of 1964 (P.L. 88-560). The definition of "elderly" families was extended to include handicapped persons in the same programs in the same act. Operating subsidies for the first time, to public housing projects were provided through special payments for units occupied by elderly families, in the Housing Act of 1961 (P.L. 87-70). The Section 221 below market interest rate program was extended to rental housing for low- and moderate-income families (below median income of area), CRS-20 IB79058 UPDATE-07/20/82 rather than limited to displaced households. 09/23/59 -— Direct low interest rate loans for housing for the elderly (Section 202) were authorized in the Housing Act of 1959 (P.L. 86-372). 08/02/54 -- The Section 221 mortgage insurance program providing liberalized terms for construction and rehabilitation of housing for displacees was adopted in the Housing ~W—: Act of 1954 (P.L. 83-560). 07/15/49 -- A national housing goal of "a decent home and suitable living environment for every American family" was announced in the Housing Act of 1949 (P.L. 81-171), which established the urban renewal program, extended public housing, and authorized assistance to farm housing through the Farmers Home Administration (FmHA). 09/01/37 —- The United States Housing Authority was created and the public housing program authorized in the United States Housing Act of 1937 (P.L. 75-412). ADDITIONAL REFERENCE SOURCES A Decent Home. Report of the President's Committee on Urban Housing (Kaiser Committee). Washington: GPO, 1968. 252 p. Aaron, Henry J. Shelter and subsidies; who benefits from Federal housing policies? Washington: Brookings Institution, 1972. 238 p. Building the American City. Report of the National Commission‘ on Urban Problems (Douglas Commission). House Document #91-34. Washington: GPO, 1968, 504 p. Dovell, Susan. Revised by Susan Vanhorrenbeck. The impact of Federal Housing programs on the elderly. Congressional Research Service, Report #79-176E. Revised Aug. 22, 1979. 56 p. Downs, Anthony. Federal housing subsidies: how are they working? Lexington, Mass.: D.C. Heath, 1973. 141 p. Eprile, Robert. Federally assisted housing in rural America. Congressional Research Service, Dec. 12, 1978. Fisher, Robert M. Twenty years of Public Housing. Economic Aspects of the Federal Program. New York: Harper and Brothers, 1959. 303 p. Grigsby, William G. and Louis Rosenburg. Urban housing policy. New York: APS Publications, 1975. 341 p. Housing in the Seventies, A report of the National Housing Policy Review. U.S. Department of Housing and Urban Development. Washington: GPO, 1974. 258 p. CRS-21 IB79058 UPDATE-O7/20/82 McFarland, Carter. Federal government and urban problems: HUD: Successess, failures, and the fate of our cities. Boulder: Westview Press, 1978. 277 p. Milgram, Grace. The Section 8 leased housing program at the end of Fiscal Year 1980. Congressional Research Service, Report 81-115E, May 13. 1981. Schechter, Henry. Critique of "Housing in the seventies." U.S. Congress, Senate. Committee on Banking, Housing, and Urban Affairs, 93d Congress, 2d session. Washington, GPO, Feb. 22, 1974. 106 p. At head of title: Committee print. Prepared by the Congressional Research Service, Library of Congress. Schussheim, Morton, J. The modest commitment to cities. Lexington, D.C. Heath, 1974. 232 p. Starr, Roger. ‘America's housing challenge: What it is and how to meet it. New York, Hill and Wong, 1977. 130 p. U.S. Congress. House. Committee on Appropriations. Subcommittee on HUD-Independent Agencies. Subsidized housing. 95th Congress, lst session. Washington, GPO, 1977. 246 p. U.S. Congress. House. Committee on Banking, Currency, and Housing. Subcommittee on Housing and Community Development. Evolution of the role of the Federal Government in housing and community development; a chronology of legislative and selected executive actions, 1892-1974. 94th Congress, 1st session. Washington: GPO, 1975. 277 p. U.S.i Congress. Senate. Committee on Banking, Housing, and Urban Affairs. Estimates of housing needs, 1975-1980. 94th Congress, 1st session. Washington, GPO, 1975. 159 p. U.S. Congressional Budget Office. Housing assistance for low— and moderate-income families. Washington: GPO, Feb. 1977. 45 p. U.S. Congressional Budget Office. Federal housing policy: Current programs and recurring issues. Washington: GPO, 1978. 74 p. U.S. Congressional Budget Office. The long-term costs of lower-income housing assistance programs. Washington: GPO, 1979. 72 p. LIBRARY OF WASHINGTON UNIVERSITY ST. LOUHS - MO. 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