Note. In those cases where sponsors were secured under DA letters AGAO-S 600.12 (13 Sep 49) CSGLD/C2, 19 September 1949; AGAO-S 600.12 (5 Oct 49) CSGLD/C2-M, 11 October 1949; and/or AGAO-S 600.12 (15 May 50) G4, 16 May 1950, the basic authority contained in these letters is continued in effect so far as they pertain to leasing and contract agreements for the projects concerned. 1. Purpose. These regulations set forth the Department of the Army policies and procedures involved in initiation, processing, development, and occupancy of rental housing secured under Title VIII, NHA (Wherry Act Housing). 2. Statutory authority. a. Act 5 August 1947 (PL 364, 80th Cong.) b. Act 8 August 1949 (PL 211, 81st Cong.) c. Act 2 May 1950 (PL 498, 81st Cong.) d. Act 1 September 1951 (PL 139, 83d Cong.) e. Act 28 September 1951 (PL 155, 82d Cong.) 3. Mortgage insurance and certification.-Under Title VIII of the National Housing Act, the Federal Housing Commissioner is authorized to insure mortgages of lending institutions made to private builders for the construction of rental housing on and near military installations when the Secretary of Defense or his designee shall have certified to the Commissioner that the housing with respect to which the mortgage is made is necessary to provide adequate housing for the personnel at the installation and that the station is deemed a part of the permanent military establishment. Housing so provided is designed for residential use by military and civilian personnel of the Army, the Navy, the Air Force, or the Marine Corps, including employees of Government contractors, assigned to duty at the military installation at or near which the property is located. 4. Definitions. For the purpose of these regulations, the following definitions apply: a. Major commander.—The Commanding General of a continental army, Military District of Washington, or one of the areas referred to in paragraph 5a. b. Mortgagee.-Original lender under a mortgage, his successors and assigns. c. Mortgagor.-Original borrower under a mortgage, his successors and assigns. d. Project schedule. A tabular description of a project showing the quantity of units by number of bedrooms, type building, shelter rental, utility costs, taxes and the over-all gross rental on a monthly basis. e. Sponsor. An individual or corporate agency capable of initiating, financing, constructing, maintaining, and managing a rental housing development on or near an Army installation. *For list of superseded publications, see last page. 5. Applicability.-Under the criteria established by Title VIII of the National Housing Act, only certain installations are eligible for rental housing. Installations must meet the following requirements: a. Must be located within one of the 48 States, the District of Columbia, Alaska, Hawaii, Puerto Rico, or the Virgin Islands. b. Must be designated as a permanent part of the military establishment with a definite long-term requirement for family housing. c. Must show a substantial net deficiency in family housing for the permanent garrison. 6. Criteria and method for determination of housing need.-a. Determination of requirement.-The first step is a determination of the installation gross housing requirement. Gross housing requirement is computed by determining the number of married officers and enlisted personnel (grades E-7, E-6, E-5, and E-4 with over 7 years' service) and civilians assigned or attached for duty at or in the vicinity of the station. Other than for isolated stations, all except key civilians are excluded from computations. b. Quarters availability. The second step is the computation of available and adequate quarters at the station. This will include a listing of all permanent type public quarters, conversions of all types, former PHA units transferred to the Department of the Army jurisdiction and any existing Title VIII, NHA housing. c. Determination of net potential. The third step is determination of the station net housing deficiency or a net potential for support of any proposed Title VIII, NHA project. Net deficiency is computed by subtracting from the gross housing requirement the number of existing and acceptable quarters as outlined in b above. d. Maximum housing units authorized. The final step indicates the maximum number of rental units any individual installation may be authorized under Title VIII, NHA. Normally, this figure is computed by reducing the net deficiency or potential by approximately 50 percent. However, in special instances, the percentage reduction may vary in accordance with the requirements of the installation. 7. Project initiation and development.-a. The installation commander is responsible for initiation of project requests when it has been determined that there is a substantial net housing deficiency for the station and when it has been determined in collaboration with field representatives of the Federal Housing Administration that the construction of a project is feasible and will have no adverse effect on the rental housing market of adjacent communities. b. The major commander is responsible for review and analysis of a project request to determine the justification for the size and schedule of the project and forwarding to the Department of the Army with specific comments and recommendations. Project requests involving class II installations will be forwarded by the major commander through the office of the head of the technical service having primary interest. c. The Assistant Chief of Staff, G-4, Department of the Army, is responsible for review of the project for conformity to statutory requirements and making recommendations to the approving authority after effecting inter-Departmental coordination. d. The Corps of Engineers is responsible for development of all projects in accordance with directives issued by the Assistant Chief of Staff, G-4. Exceptions may be authorized by the Department of the Army in special cases. The responsibility of the Corps of Engineers continues through all phases of development and involves action associated with design, when applicable, obtaining favorable appraisal and eligibility statements, certifications of need and consummating mortgage arrangements and leasing and service contract documents. In addition, the Corps of Engineers will provide nominal surveillance of construction activities, report unsatisfactory progress and apparent construction deficiencies to the Federal Housing Administration and, where necessary, advise the Federal Housing Administration so that necessary corrective measures can be taken to assure provision of adequate housing with minimum delay. 8. Sponsor selection.-Sponsors for projects will be selected from among those who submit proposals in response to solicitations using Government-furnished plans. Final selection is based on the proposal of a sponsor providing the desired housing at the lowest bid replacement cost and who is deemed acceptable by the Federal Housing Administration for mortgage insurance processing. The exception to this procedure will be in the case of projects for which sponsorship is secured by negotiation using either Government- or sponsor-furnished plans. For the exception, the sponsor will be selected after it has been determined that his proposal will provide the desired housing, that his professional reputation and integrity together with his financial resources will assure his acceptance by the Federal Housing Administration for mortgage insurance processing and that the construction of the proposed project is feasible under statutory limitations and specified gross rentals. 9. Construction phase.-a. The mortgagor is responsible for all construction incident to the project, including connection of utilities to the post system when the Government furnishes any or all utilities. When private public utility companies supply utilities to the sponsor, necessary easements may be granted across Government property to and on the project area in accordance with AR 100-62. b. The Corps of Engineers will provide for or make arrangements with the post engineer to provide (1) The mortgagor or construction agency with necessary temporary utilities which cannot reasonably be furnished from outside sources. Costs of extensions or connections will be borne by the mortgagor or construction agency. Billing on a reimbursable basis will be rendered by the post engineer in accordance with AR 420-80. (2) The mortgagor with installation maps showing location of underground utility systems. (3) A system of maintaining data concerning the progress of construction for purposes of scheduling occupancy. (4) Coordination of details as may be necessary between the mortgagor and the installation. 10. Operating phase.-a. The mortgagor is responsible for collection of rents and operation of the project in accordance with its articles of incorporation and the terms and conditions of the lease granted by the Government for the construction of the project or as this lease may be amended by future mutual agreement of all concerned. b. The Corps of Engineers is responsible for acting upon all technical problems relating to leases, utility contract modifications, etc., as may arise between the mortgagor or management agency and the installation. When these problems cannot be solved at local level, they will be referred through Engineer channels to higher echelons for resolution. c. The Corps of Engineers will be responsible for enforcing the terms of and the conditions of the lease granted by the Government and these regulations except as otherwise provided for in the lease. Administrative problems that cannot be solved at station level, will be referred through appropriate channels to higher headquarters for resolution. 11. Occupancy policy.-a. Priority of occupancy which is afforded military and military-connected civilian personnel for rental housing constructed under the provisions of Title VIII, NHA, is not assigned as are public quarters. However, in certifying persons to the rental management for occupancy of this housing, commanders will be guided by the principles of assignment in AR 210-10. Exceptions are authorized, within the spirit of AR 210-10, as are dictated by local conditions, size of family and economic status of the personnel concerned. b. In accordance with the lease, the mortgagor will make all units in the housing project available to station personnel certified by the installation commander, as in a above. However, in the event the installation commander fails to certify personnel to the rental management within 30 days after receipt of written notice from the mortgagor that the unit or units are available, the mortgagor may lease such units to other than station personnel. Further, the Army, in initially certifying to the Federal Housing Administration the need for this housing, has assumed a definite moral obligation and has a keen self-interest in all housing projects to assure that all units are occupied within the allowed occupancy factor for the individual project. Accordingly, it will be the direct responsibility of the installation commander to provide the mortgagor with a coordinated and aggressive program to assure maximum occupancy. 12. Negotiation of leases.-Real property may be outleased, to effectuate the intent of Title VIII, NHA, within the meaning of the Act of 5 August 1947 (61 Stat. 774) under such terms and conditions as will best serve the national interest without regard to the limitations imposed by the act in respect of the term or duration, and the power to revoke such lease in the event of a national emergency shall not apply. a. Responsibility for the determination of availability of land for outleasing purposes in connection with Title VIII, NHA projects, will be in accordance with SR 210-15-1 for command installations and SR 210-15-2 for industrial installations. b. The Corps of Engineers is responsible for negotiation of leases on the appropriate lease form and forwarding to the Office of the Secretary of the Army for execution. 13. Utilities and related services.-Utilities and related services, as otherwise are not available from local public or private sources, may be sold on a reimbursable basis by the Government to housing projects constructed under Title VIII, NHA. a. Rates for charges will be determined by the Corps of Engineers in accordance with AR 420-80, with the exception that local prevailing rates will not be used and in no case will charges be at less than cost to the Government. b. Terms and conditions of any contract, including the period of contract, will be as specified in the appropriate form for utility contracts and will be supplemental to the lease negotiated for the individual project. c. Contracts covering utilities and related services will be referred to the Department of the Army for approval. 14. Community facilities. As a general policy, commercial shopping facilities in connection with Title VIII, NHA projects will not be authorized. If provision of commercial shopping facilities is contemplated in any project under consideration and inclusion of these facilities appears in the best interest of the Army, requests for the project and/or the facilities together with complete justification for exceptions to the general policy may be forwarded to the Department of the Army for consideration. No commitment or indication of such commitment regarding such facilities will be made prior to receipt of Department of Army action. 15. Expenditure of appropriated funds.-Appropriated funds as authorized by Public Law 155, 82d Congress, may be expended for acquisition of land, installation of outside utilities and site preparation for housing projects constructed under Title VIII, NHA. Such expenditure will not exceed an average of $1,500 per housing unit in any one project nor an average of $1,000 per housing unit in respect of all housing projects for which expenditure may be approved. a. No appropriated funds will be expended in the development of projects where title to the land will not remain with the Department of the Army. b. The need for expenditures of appropriated funds will be determined by the Corps of Engineers after consultation with the Federal Housing Administration and before the issuance of a commitment to insure by the Federal Housing Administration. Obligation and expenditure of appropriated funds in connection with Title VIII, NHA projects, will be by the Corps of Engineers in accordance with directives and after approval by the Assistant Chief of Staff, G-4, Department of the Army. 16. Police protection.-Police protection may be provided to a housing project by the installation commander, however, the commander cannot by contract provision void or lessen his personal responsibility for station security. If the protection or security of his post is, in his opinion, endangered or threatened, or conditions prevail which require additional police personnel, the cost thereof should be charged to the lessee. In the event usual traffic control lights, painted curbs, markers for parking areas, or other traffic signs or devices are required, the post or station engineer should compute the costs which should be charged to the project and the reimbursable features covered in the letter agreement. 17. Project taxation. After a project is completed and it has been released for occupancy, if the installation commander has reason to believe that the Department of the Army may have an interest in a tax problem involving a Title VIII, NHA housing project, the facts of the problem should be forwarded to the Office of The Judge Advocate General, Washington 25, D. C., ATTN: Procurement Division, in accordance with APP 11-350a. Except for the purpose of obtaining information on the nature of the problem involved, independent conferences or direct negotiations with State or local tax authorities will not be undertaken by Department of the Army personnel without express authority of the Office of The Judge Advocate General. [AG 600.12 (11 Apr 52)] BY ORDER OF THE SECRETARY OF THE ARMY: OFFICIAL: WM. E. BERGIN The Adjutant General DISTRIBUTION: J. LAWTON COLLINS These regulations, together with SR 210-220-1, 8 May 1952, supersede the following DA letters, except that in those cases where sponsors were secured under DA letters AGAO-S 600.12 (13 Sep 49) CSGLD/C2, 19 September 1919; AGAO-S 600.12 (5 Oct 49) CSGLD/C2-M, 11 October 1949; and/or AGAO-S (15 May 50) G4, 16 May 1950, the basic authority contained in these letters is continued in effect so far as they pertain to leasing and contract agreements for the projects concerned: File (AGAO-S 620 (14 Sep 48) CSGSP-M)...---(AGAO-S 620 (11 May 49) CSGLD/C2)... Date Subject Provision of Family Housing by Private Procedures for Processing Projects under (AGAO-S 600.12 (13 Sep 49) CSGLD/C2)............ 19 Sep 1949 Procedures for Operations under Public Law 211 (The Wherry Bill) (with five inclosures). (AGAO-S 600.12 (5 Oct 49) CSGLD/C2-M).. 11 Oct 1949 Procedures for Operation under Public Law 211 (The Wherry Bill) (with one inclosure). (AGAO-S 620 (13 Oct 49) (CSGLD/C2)................. 18 Oct 1949 Supplemental Instructions for Processing (AGAO-S 600.12 (9 Feb 50) CSGLD/C2)............. 20 Feb 1950 16 May 1950 (AGAO-S 600.12 (15 May 50) G4.. Projects under Title VII, National Housing Act (with one inclosure). Provision of Community Facilities in Con- Lease Considerations for Government Land Revised Title VIII, NHA Procedures (off- Title VIII, NHA Housing-Procurement Revision of Title VIII, NHA Procedures Processing of Title VIII, NHA Family Procedures for Operation under Title VIII, Exepnditure of Funds for Title VIII Hous Procedures for Operation under Title VIII, Revised Procedures for Selection of Spon [H. Rept. No. 410, 81st Cong., 1st sess.] MORTGAGE INSURANCE FOR MILITARY HOUSING The Committee on Banking and Currency, to whom was referred the bill (S. 1184) to encourage construction of rental housing at or in areas adjacent to military and naval installations, having considered the same, report favorably thereon with amendments and recommend that the bill, as amended, do pass. GENERAL STATEMENT The purpose of the bill is to encourage private enterprise to construct rental housing to serve the needs of personnel at military installations, primarily through (1) the provision of a special form of mortgage insurance not otherwise available, (2) the leasing of sites by the Military Establishment free from the right of revocation, and (3) the provision of utility services by the Military Establishment on a long-term basis. As introduced, the bill would have amended the National Housing Act by adding a new title VIII to provide for the insurance of mortgages on new rental housing |