of an urban renewal project through approval of a survey and planning application, that facility is eligible as a grant-in-aid to the project regardless of whether the final approval of the urban renewal project takes place more than 3 years later. Going a step further, a facility is eligible if it is commenced after Federal recognition of a project through approval of a general neighborhood renewal plan encompassing that project. This is true regardless of how long the GNRP approval precedes approval of the survey and planning application for the urban renewal project itself and, of course, also regardless of how long it precedes approval of a loan and grant contract for that project. We believe that the present 3-year rule, as so applied, is sufficiently liberal, in view of the need for a reasonable relationship between the construction of the public facility and the planning of the urban renewal project which it is to serve and support. As stated in the Senate committee report on the Housing Act of 1959, which established the 3-year limitation, local public facility project should be credited "only if the projects are clearly a part of, and contributory to, the urban renewal project." Such facilities are granted credit in the cost of an urban renewal project on the basis that they help to carry out the objectives of that project, objectives that can be logically determined only as part of the urban renewal planning process, which culminates in the loan and grant contract for the project. If your committee does favorably consider the bill, a technical amendment would be desirable to indicate that the provisions of the bill would not apply to projects already under loan or grant contract. Sincerely yours, ROBERT C. WEAVER, Administrator. Hon. A. WILLIS ROBERTSON, TREASURY DEPARTMENT, Washington, D.C., September 12, 1963. Chairman, Committee on Banking and Currency, DEAR MR. CHAIRMAN: Reference is made to your request for the views of this Department on S. 1440, to amend section 110 (d) of the Housing Act of 1949. The proposed legislation would make a local donation or provision of a public improvement or facility for a project under the slum clearance and urban renewal program eligible as a local matching grant-in-aid if the construction of such improvement or facility was commenced 3 years prior to authorization by the Housing and Home Finance Administrator of a survey or planning advance in lieu of 3 years prior to the authorization of a contract for a loan or capital grant for the project. Since the subject matter of the proposed legislation relates primarily to a matter within the jurisdiction of the Housing and Home Finance Agency, the Department defers to the views of that Agency as to the general merits of the proposed legislation. The Department has been advised by the Bureau of the Budget that there is no objection from the standpoint of the administration's program to the submission of this report to your committee. Sincerely yours, G. D'ANDELOT BELIN, General Counsel. 88TH CONGRESS 1ST SESSION S. 1947 IN THE SENATE OF THE UNITED STATES JULY 29, 1963 Mr. TowER introduced the following bill; which was read twice and referred to the Committee on Banking and Currency A BILL To amend section 110 (h) of the Housing Act of 1949. 1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 That (a) the first sentence of section 110 (h) of the Housing 4 Act of 1949 is amended to read as follows: "Local public 5 agency' means a county, municipality, or other local gov6 ernment, or a State, or any public body exercising all of its 7 functions relating to a project as agent for a local govern8 ment or a State, or two or more such local governments, 9 States, or bodies authorized to undertake the project for 10 which assistance is sought." 11 (b) The amendment made by subsection (a) shall not 2 1 apply to any urban renewal project with respect to which a contract has been entered into under title I of the Housing 3 Act of 1949, prior to July 1, 1965, for advances of funds 4 for surveys and plans or for loans or grants. HOUSING AND HOME FINANCE AGENCY, Subject: S. 1947, 88th Congress (Senator Tower). Chairman, Committee on Banking and Currency, DEAR MR. CHAIRMAN: This is in further reply to your request for the views of this Agency on S. 1947, a bill to amend section 110 (h) of the Housing Act of 1949. This bill would amend the definition, in section 110(h) of the Housing Act of 1949, of a "local public agency" qualified to carry on an urban renewal project. Under present law, a project may be carried on not only by a State, county, or municipality but also by any other "governmental entity or public body," so long as it is "authorized" (under State and local law) to carry on the project. The amendment proposed by Senator Tower would limit eligibility of other governmental entities and public bodies only to those acting as agents for State or local governments. The purpose of this change was stated by Senator Tower, upon introduction of the bill, to be to assure that the officials undertaking urban renewal projects are directly and fully responsible to the city or other local government. He stated that the present situation, where the LPA officials are usually appointed for a prescribed term by city or other local government officials, does not give the local officials effective control. The occasion for the formation of such semiautonomous LPA's was, in some cases, in order to assure that they would be able to receive title I loans for interim financing of projects, without such loans counting against the debt limit of the locality. However, nearly all the States now apply a "special fund" doctrine in interpreting local debt limitations, under which such loans are not, in any case, counted against the local debt limit if they are not payable out of general revenues. There is, therefore, some question as to how many States would be affected, so far as financing is concerned, by the Tower amendment. However, there is a broader question of whether this amendment would unjustifiably interfere with the right of the States and localities to decide for themselves their proper relationship to the LPA's. Close coordination between LPA's and elected local governments is always desirable. However, it would appear that there is no impelling need which would justify the proposed detailed intercession by the Federal Government in these State-local relationships. Under section 102(d) of the Housing Act of 1949, it is already necessary, as a condition to obtaining an advance of funds for survey and planning, that "the governing body of the locality involved has by resolution or ordinance approved the undertaking of such surveys and plans and the submission by the local public agency of an application for such advance of funds." Also, under section 105(a), the governing body of the locality must approve the urban renewal plan before the LPA can obtain a Federal loan and grant contract for a project. Finally, the LPA must almost invariably obtain the concurrence of the local governing body, in order to obtain financing for the local share of the cost of the project. Sincerely yours, Hon. A. WILLIS ROBERTSON, ROBERT C. WEAVER, Administrator. TREASURY DEPARTMENT, Washington, D.C., September 30, 1963. Chairman, Committee on Banking and Currency, DEAR MR. CHAIRMAN: Reference is made to your request for the views of this Department on S. 1947, to amend section 110(h) of the Housing Act of 1949. The proposed legislation would amend section 110(h) of the Housing Act of 1949, 63 Stat. 421, by defining a "local public agency" to mean a county, municipality, or other local government, or a State, or any public body exercising all of its functions relating to a project as agent for such State or local government, or two or more such local governments or bodies authorized to undertake the project. The proposed amendment would not apply to financing extended for projects under the act prior to July 1, 1965. The purpose of the proposed legislation would appear to be to place future urban renewal projects under more effective control of the State, city, or other local government. S. 1947 is not of primary interest to the Treasury Department and we have no comments to make with respect to its general merits. The Department has been advised by the Bureau of the Budget that there is no objection from the standpoint of the administration's program to the submission of this report to your committee. Sincerely yours. G. D'ANDELOT BELIN, General Counsel. 88TH CONGRESS 1ST SESSION S. 1948 IN THE SENATE OF THE UNITED STATES JULY 29, 1963 Mr. TowER introduced the following bill; which was read twice and referred to the Committee on Banking and Currency A BILL To limit financial assistance under title I of the Housing Act 1 of 1949, after July 1, 1965, to projects which cannot be self-liquidating under applicable State law. Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 That section 101 of the Housing Act of 1949 is amended 4 by adding at the end thereof a new subsection as follows: "(e) No contract shall be entered into for any loan or 5 6 capital grant under this title with respect to any project 7 (not constructed or covered by a contract for annual con 8 tributions prior to July 1, 1965) for the redevelopment of 9 any area in a locality which, under applicable State law, is 10 permitted to pledge any increase in tax revenues resulting |