regulations of the Public Housing Administration prescribed on the recommendation of the Secretary of Health, Education, and Welfare, and, insofar as practicable, such services would be correlated with programs administered by this Department. There is undoubtedly a great need for a variety of social services to assure the well-being of persons living in, or displaced by, low-rent housing projects, and to reduce the incidence of poverty and deprivation among this group, as well as other low-income groups in our communities. And, as shown by demonstrations sponsored by a joint task force of the HHFA an this Department, much can be accomplished through cooperation of housing, welfare, and other community agencies in bringing to bear available social services-e.g., day care for children-on families living in low-rent housing. This Department, which is deeply involved in many ways in the provision of welfare services for lowincome individuals and families, is especially conscious of this need. However while fully in accord with the basic objective of section 206, we recommend against its enactment in its present form and as part of a housing measure. In the first place, though selected demonstration projects (authorized under existing law) with respect to families living in low-rent public housing are fully justified, we doubt the desirability of singling out these particular low-income families for special mandatory statutory Federal financing, without local cost sharing, of welfare services of which other Federal low-income families are also in need. In the second place, the Social Security Act, as strengthened by the Public Welfare Amendments of 1962, provides special incentives for welfare services to low-income individuals and families. To fragmentize Federal responsibility in this area seems to us undesirable. Finally, we believe that the proposed Economic Opportunity Act, with its community action and other programs, provides, at this time, the most desirable framework through which the Congress can help to provide, to those living in or displaced by low-rent housing projects, as well as to other low-income families, the social welfare and other community services for which Federal aid is not already available and which are needed to enable them to live in decency and dignity and to achieve, so far as possible, economic self-sufficiency. 2. Section 304 of the bill would amend title V of the National Housing Act to preclude mortgage insurance where public water and sewage facilities are economically feasible but unavailable. Similar conditions would be applied to Veterans' Administration loans under section 1804 of title 38, United States Code. We are in accord with the basic objective of this section, i.e., to require adequate community water and sewerage systems in federally insured or guaranteed housing programs where this is economically feasible. We have been very much concerned about the health problems caused by the indiscriminate installation and frequent failure of individual water supplies and sewage disposal systems in suburban areas of the country, problems that have ensued in almost every urbanized area where such systems have been used. The health hazards are most critical in urbanized areas where substantial population groups are involved. And in many of the urbanized areas where failures of such individual facilities have occurred, resulting economic losses have had a major impact. As regards the specific provisions of section 304, the report of the HHFA on this bill points out certain defects, as well as the fact that, in fairness, the provision should not apply to existing homes. Senator Muskie has proposed an amendment (a new sec. 207) to the administration's housing bill (S. 2468), an amendment which overcomes the problems posed by the language and scope of section 304 of the present bill and which, we understand, is acceptable to the HHFA, subject to minor technical perfecting changes. The Muskie amendment, moreover, is in terms coordinated with a requirement for adequate water and sewerage systems contained in the administration bill's provisions (title II) for a new program of FHA mortgage insurance for land development. With the Muskie amendment (perfected as proposed by HHFA), the administration bill would therefore fully and better accomplish the objective of section 304 of S. 2031 in these respects. 3. Section 302 of the bill would amend the provisions for mortgage insurance of home improvement loans contained in sections 203 (k) and 220(h) of the National Housing Act, so as to cover loans (up to $10,000) to meet that part of the cost of public improvements (including sewerage facilities) assessed against or legally owning by a property owner. We concur with the HHFA in favoring this provision. We are advised by the Bureau of the Budget that there is no objection to the presentation of this report from the standpoint of the administration's program. Sincerely, WILBUR J. COHEN, Assistant Secretary. HOUSING AND HOME FINANCE AGENCY, Subject: S. 2086, 88th Congress (Senator Brewster). Chairman, Committee on Banking and Currency, DEAR MR. CHAIRMAN: This is in further reply to your request for our views on S. 2086, a bill to amend sections 220, 221, and 233 of the National Housing Act. Under existing law, the Federal Housing Commissioner is given discretionary authority to provide for cash payment of insurance claims, rather than payment in debentures, in cases of defaults of mortgages insured under the urban renewal housing program (sec. 220), the displaced and moderate income family housing program (sec. 221), and the experimental housing program (sec. 233). However, where there is a delay in cash payments, no interest accrues as in the case of debentures. This bill would permit the cash payment of an insurance claim to include an amount equal to the interest which would have accrued on debentures up to the time of settlement of the claim if the claim had been paid in debentures rather than cash. The Housing Agency favors the objectives of this proposed legislation. As you know, a similar provision is contained in section 802 of the administration's proposed Housing and Community Development Act of 1964. We believe that the provisions of S. 2468 will effectively achieve the objectives of S. 2086. The Bureau of the Budget has advised that there is no objection to the presentation of this report from the standpoint of the administration's program. Sincerely yours, ROBERT C. WEAVER, Administrator. HOUSING AND HOME FINANCE AGENCY, Subject: S. 2524, 88th Congress (Senator Edmondson). DEAR MR. CHAIRMAN: This is in further reply to your request for our views on S. 2524, a bill to amend title IV of the Housing Amendments of 1955 with respect to the acquisition by the Secretary of Defense or his designee of certain housing constructed and insured under section 608 of the National Housing Act. This bill would authorize the Secretary of Defense to acquire any housing financed with mortgages insured under section 608 of the National Housing Act (including adjacent property constructed primarily to provide commercial facilities for the occupants of such housing) completed prior to July 1, 1952, which is situated on or adjacent to a military installation and which was considered as necessary military housing prior to construction. The Secretary of Defense is authorized under existing law to acquire housing insured under title VIII of the National Housing Act (Wherry Act housing) and FHA section 207 rental housing. The Housing Agency defers to the Department of Defense as to the need or desirability for the additional authority contained in S. 2524. The Bureau of the Budget has advised that there is no objection to the presentation of this report from the standpoint of the administration's program. Sincerely yours, ROBERT C. WEAVER, Administrator. ADDITIONAL HHFA MATERIAL SUBMITTED FOR THE RECORD Independent Offices Appropriation Acts limit to amount prescribed in such acts. HOUSING AND HOME FINANCE AGENCY Proposed Housing and Community Development Act of 1964 (H.R. 9751 and S. 2468)-Summary of program authorizations and budgetary impact, fiscal years 1965-68 [Unit factors in whole numbers, dollars in millions] 1 CA-Contract authorization. 2 Proposed legislation would provide for authorization for appropriations without maximum limitation. New obligational authority shown is estimated appropriations included in 1965 budget from new authorizations only. Net budget expenditure estimates are based solely on assumed newly enacted authorizations. NOA and expenditures for these programs which might occur from budget recommendations of the President or appropriation actions of the Congress for years subsequent to fiscal 1965 are not projected. Except as shown, new programs would be funded from existing authorization for special assistance functions of FNMA. 5 Nonadd items funded from title I grant authorization. Except as shown, new programs would be funded from existing authorization for public facility loans. 7 Totals include only those authorizations, new obligational authority and expenditures which are identifiable in the proposed legislation or in the 1965 budget. |