[S. 914, 86th Cong., 1st sess.] MR. LANGER A BILL To amend section 404 (b) of the Housing Act of 1950 Be it enacted by the Senate and House of Representatives of the United States of American in Congress assembled, That clause (1) of section 404(b) of the Housing Act of 1950 is amended to read as follows: "(1) any educational institution which offers at least a two-year program acceptable for full credit toward a baccalaureate degree or is supervised by and under the jurisdiction of a State board of higher education, including any public educational institution, or any private educational institution no part of the net earnings of which inures to the benefit of any private shareholder or individual,". S. 914 DIGEST OF BILL Amends the college housing loan program so that the definition of an educational institution qualifying for a loan would include institutions "supervised by and under the jurisdiction of a State board of higher education." Under existing law, an institution must be able to grant degrees or offer at least a 2-year program "acceptable for full credit toward a baccalaureate degree." HOUSING AND HOME FINANCE AGENCY, Re S. 914, 86th Congress. OFFICE OF THE ADMINISTRATOR, Chairman, Committee on Banking and Currency, U.S. Senate, Washington, D.C. DEAR MR. CHAIRMAN: This is in further reply to the letter of February 5 from your committee requesting the views of this Agency on S. 914, a bill to amend section 404(b) of the Housing Act of 1950. This bill would amend the definition of an educational institution qualifying for college housing loans under title IV of that act to include one "supervised by and under the jurisdiction of a State board of higher education." Under the present law, in addition to degree-granting institutions, a school may qualify if it offers at least a 2-year program "acceptable for full credit toward a baccalaureate degree." We understand that S. 914 was introduced by Senator Langer to meet the type of problem faced several years ago by the North Dakota State School of Science in applying for assistance under the college housing program. Although the bulk of its students were taking courses beyond the high-school level, they were not then studying under programs "acceptable for full credit toward a baccalaureate degree." Accordingly, the school withdrew its application. We understand that changes in enrollment at the school have now removed that disqualification and that a reapplication would now be accepted. We know of no other institution that desires assistance under the program that would be made eligible by this amendment. It would therefore appear to be no longer needed. If your committee does recommend its enactment, however, we would suggest the insertion of the following phrase in line 6 after the word "or": "which provides at least a two year educational program beyond the high-school level and". This change would merely make it clear that the proposed extension of eligibility is intended to be limited to institutions of higher learning. We have been informed by the Bureau of the Budget that this report is without objection insofar as the Bureau is concerned. Sincerely yours, NORMAN P. MASON, Administrator. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, Hon. A. WILLIS ROBERTSON, Chairman, Committee on Banking and Currency, Washington, D.C. May 6, 1960. DEAR MR. CHAIRMAN: This is in response to your requests of February 5, 1959, January 27, 1960, January 27, 1960, and February 2, 1960, for reports, respectively, on S. 914, a bill to amend section 404 (b) of the Housing Act of 1950; S. 2911, a bill to amend the Housing Act of 1950 to authorize additional loans for college housing, and for other purposes; S. 2912, a bill to amend the Housing Act of 1950 with respect to the amount of loans permitted to be made in any State, and S. 2950, a bill to increase the borrowing authority of the Housing and Home Finance Agency for college housing loans. Both S. 2911 and S. 2950 would amend section 401 (d) of the Housing Act of 1950 to increase the amount of the college housing loans authorized to be outstanding. The present ceiling on the amount of college housing loans outstanding is $1.175 billion and this amount has been virtually exhausted. The Housing and Home Finance Agency is still receiving loan applications from institutions of higher education, but these aplications are not being processed. This Department has recommended enactment of legislation to authorize a new college facilities construction program which would provide Federal financial assistance for the construction of urgently needed college facilities, both academic and housing facilities. This legislation proposal is embodied in S. 1017, now before the Senate Committee on Labor and Public Welfare for consideration. S. 1017 would authorize a 5-year program of Federal guarantees of taxable obligations issued by colleges and universities and Federal debt retirement assistance for both taxable and tax-exempt obligations issued to construct both academic and housing facilities. Enactment of S. 1017 would obviate the occasion for any increase in the loan authorizations under the existing college housing loan program and extend Federal assistance on a sounder and more effective basis. Accordingly, we are opposed to any further increases in the loan ceilings now provided under section 401 (d) of the Housing Act of 1950 and we urge instead that S. 1017 be enacted. S. 914 would amend the definition of "educational institution" contained in section 404 (b) (1) of the Housing Act of 1950 by inserting the phrase "or is supervised by and under the jurisdiction of a State board of higher education." The effect of this would be to modify, in the case of certain public institutions, the requirement that an institution (to be eligible for a college housing loan) offer at least a 2-year program acceptable for full credit toward a baccalaureate degree, so that 2-year public institutions which are a part of the State university system and offer only terminal courses would be eligible. We would agree that the definition of "educational institution" for the purposes of this and similar acts should be broadened to include technical institutes and other 2-year institutions offering post-high-school courses leading to an associate degree. Accordingly, the definition set forth in S. 1017, section 4(b), would include both public and private nonprofit institutions of this kind, which are defined as "any educational institution which (a) admits as regular students only persons having a certificate of graduation from a secondary school, or the recognized equivalent of such certificate, (b) offers at least a 2-year educational program, and (c) is a public educational institution, or is a private educational institution no part of the net earnings of which inures to the benefit of any private shareholder or individual." We prefer the definition quoted above, as it provides for equal treatment of both public and private institutions and more clearly identifies the type of 2-year institutions to be made eligible. Accordingly, we would not favor the language contained in the instant bill S. 914. S. 2912 would amend section 403 of the Housing Act of 1950 to increase from 10 to 122 percent the limitation on housing loans to be made to an educational institution in any one State. If the existing college housing loan program were to be continued with an increased loan authorization, we would favor this amendment because 12% percent more nearly represents the percentage of total college attendance in the institutions of both New York and California (which together have 22 percent of the total college attendance of the Nation). Also, construction costs for educational facilities in these two States are above the national average and, therefore, more funds are required to construct a given amount of space. The Bureau of the Budget advises that it perceives no objection to the submission of this report to your committee and that enactment of S. 2911 and S. 2950 would not be in accord with the President's program. Sincerely yours, ROBERT A. FORSYTHE, [S. 1342, 86th Cong., 1st sess.] MR. JAVITS (for himself and MR. CLARK) A BILL To create a Federal Limited Profit Mortgage Corporation to assist in the provision of housing for moderate-income families and for elderly persons Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, FINDINGS SECTION 1. (a) While the Congress, in the declaration of national housing policy set forth in the Housing Act of 1949, established the goal of a decent home and a suitable living environment for every American family, experience has demonstrated that this goal is not being met or even approached for the millions of American families whose incomes are too high for admission to low-rent public housing but too low to afford the range of sales prices and rents required for satisfactory new private housing being produced under the existing Federal programs of asistance to private enterprise in housing. Therefore, to further implement the declaration of national housing policy, and consistent with the provision thereof that governmental assistance shall be utilized where feasible to enable private enterprise to serve more of the total housing need, the Congress hereby determines that there is an urgent need for a supplementary system of housing finance to enable private enterprise to provide homes of sound standards of design and construction for families of moderate income and for elderly persons. (b) The Congress further determines that there are means available to State and local governments to further assist private enterprise to meet this need at little or no direct cost to such governments by (1) granting exemptions, in whole or in part, from taxation on the increased value of real property, (2) assisting in the assembling of sites through the use of the power of condemnation and eminent domain, and (3) promoting the use of sites, cleared under the slum clearance and urban renewal provisions of the Housing Act of 1949, for such housing. While not making such assistance mandatory, it is the sense of the Congress that such assistance should be given to housing constructed under this Act. PURPOSE SEC. 2. The purpose of this Act is to provide satisfactory housing in wellplanned, integrated residential neighborhoods for families of moderate income and elderly persons whose needs are not now being served through existing programs of assistance to private and public enterprise, and to accomplish this purpose, this Act makes financial assistance available to eligible borrowers for the provision of housing of sound design and construction which will promote such economies as will be fully reflected in reduced rents or charges. CREATION AND POWERS OF FEDERAL LIMITED PROFIT MORTGAGE CORPORATION SEC. 3. (a) To effectuate the purpose of this Act, there is hereby created a body corporate to be known as the "Federal Limited Profit Mortgage Corporation" (hereinafter referred to as the "Corporation") with authority, as herein provided, to make and service loans, issue obligations in such amounts, at such times, and on such terms as the Corporation may determine, and to exercise the other powers and duties prescribed in this Act. In the performance of, and with respect to, the functions, powers, and duties vested in it by this Act, the Corporation, notwithstanding the provisions of any other law, may— (1) adopt and use a corporate seal: (2) sue or be sued in any Federal, State, or local court of competent jurisdiction; (3) enter into contracts with regard to section 3709 of the Revised Statutes and make advance, progress, or other payments with respect to such contracts without regard to the provisions of section 3648 of the Revised Statutes, and include in any contract or instrument made pursuant to this Act such other provisions as the Corporation deems necessary to assure that the purposes of this Act will be achieved; (4) foreclose on any property or take any action to protect or enforce any right conferred upon it by any law, contract, or other agreement, and bid for and purchase at any foreclosure or any other sale any project or part hereof in connection with which it has made a loan pursuant to this Act: (5) pay all expenses or charges in connection with, and deal with, complete, reconstruct, improve, rent, manage, make contracts for the management of, or establish suitable agencies for the management of, or sell for cash or credit, or lease in its discretion, in whole or in part, any project acquired pursuant to this Act and to pursue to final collection by way of compromise or otherwise all claims acquired by, or assigned or transferred to, it in connection with the acquisition or disposal of any housing project pursuant to this Act, notwithstanding any other provisions of law relating to the acquisition, handling, or disposal of real or personal property: Provided, That any such acquisition of real property shall not deprive the State or any political subdivision thereof of its civil or criminal jurisdiction in and over such property or impair the civil rghts under State or local laws of the inhabitants on such property; (6) acquire, hold, sell, or exchange at public or private sale, or lease, or otherwise dispose of, real or personal property, and sell or exchange any securities or obligations; (7) obtain insurance against loss in connection with property and other assets held; (8) subject to the specific limitations in this Act, consent to the modification, with respect to rate of interest, time of payment of any installment of principal or interest, security, or any other term, of any contract or agreement to which it is a party or which has been transferred to it pursuant to this Act; (9) utilize and act through, with regard to section 3709 of the Revised Statutes, any Federal, State, or local public agency or instrumentality, or nonprofit agency or organization, with the consent of the agency or organization concerned, and contract with any such agency, instrumentality, or organization for the furnishing of any services or facilies; and may make advance, progress, or other payments with respect to such contracts without regard to the provisions of section 3648 of the Revised Statutes: (10) enter into contracts with any Federal Housing Administration approved mortgagee to service loans made by such institutions; (11) have succession in its corporate name: and (12) do all things which are necessary or incidental to the proper manageIment of its affairs and the proper conduct of its business. (b) Except as provided in provisions of law relating specifically to mixedownership Government corporations, the Corporation may determine the necessity for and the character of its obligations and expenditures and the manner in which they shall be incurred, allowed, and accounted for. The business of the Corporation shall not be considered official business of the United States within the meaning of any statute permitting the free use of the United States mails. BOARD OF DIRECTORS SEC. 4. (a) The management of the Corporation shall be vested in a Board of Directors (hereinafter referred to as the "Board") consisting of five persons, one of whom shall be the Housing and Home Finance Administrator as Chairman of the Board, and four of whom shall be appointed by the Administrator from among the officers or employees of the Corporation, of the immediate office of the Administrator, or (with the consent of the head of such department or agency) of any other department or agency of the Federal Government. The Board shall meet at the call of its Chairman, who shall require it to meet not less than once each month. Within the limitations of law, the Board shall determine the general policies which shall govern the operations of the Corporation. The Board shall select and effect the appointment of a qualified person to fill the office of President of the Corporation. The basic rate of compensation of the position of President of the Corporation shall be the same as the basic rate of compensation establised for the heads of the constituent agencies of the Housing and Home Finance Agency. The Board shall select, employ, appoint, and fix the compensation of such other officers and employees as may be necessary to carry out the duties of the Corporation, without regard to the provisions of law applicable to the employment, compensation, leave, or expenses of officers and employees of the United States; except that the rates of basic compensation of such officers and employees shall be comparable to those established for officers and employees under the Classification Act of 1949, as amended. The members of the Board, as such, shall not receive compensation for their services. (b) The Board shall supervise the Corporation, shall perform the other duties prescribed herein, and shall have the power to adopt, amend, and require the observance of such rules, regulations, and orders as shall be necessary from time to time for carrying out the purposes of this Act and for coordinating the activities of the Corporation with the housing functions and activities administered within the Housing and Home Finance Agency, or any of its constituent agencies, and with the general economic and fiscal polices of the Government, and in carrying out these responsibilities the Board shall consult with the Advisory Committee, established under subsection (C) of this section. In the performance of, and with respect to, the functions, powers, and duties vested in it by this Act, the Board, notwithstanding the provisions of any other law, may exercise any of the powers enumerated in the second sentence of section 3 (a) of this Act and shall (1) estimate the need for housing for moderate-income families and elderly persons in each housing market area of the country and allocate and reallocate to ach area its appropriate share of the loan funds authorized by this Act; (2) delegate, in its discretion, any of the functions, powers, and duties vested in it by this Act to any officers or employees under its direction and supervision; (3) take such steps as it deems necessary and desirable to assure that the benefits of this program are not dissipated through speculative devices, to assure that the organization of any corporate borrower and its proposed methods of operation are such as will avoid its use for speculative purposes or the payment of excessive fees, salaries, or charges in connection with any housing project, and to encourage borrowers to adopt methods by which occupants of dwellings may be permitted to reduce their rentals or other occupancy charges by occupant maintenance and repair or other means of self-help and methods whereby they may acquire (subject to the right of a cooperative to repurchase) ownership of their individual dwellings where such dwellings are free standing; (4) prepare annually and submit a budget program as provided for wholly owned Government corporations by the Government Corporation Control Act, as amended; (5) maintain an integral set of accounts which shall be audited annually by the General Accounting Office in accordance with the principles and procedures applicable to commercial transaction as provided by the Government Corporation Control Act, as amended, and no other audit shall be required: Provided, That such financial transactions of the Corporation as the making of advances of funds and vouchers approved by the Board in connection with such financial transactions shall be final and conclusive upon all officers of the Government; and (6) make an annual report to the President, for transmission to the Congress, to be submitted as soon as practicable following the close of the year for which such report is made. (c) (1) An advisory committee shall be appointed by the Board to consist of seven members. In appointing such members the Board shall seek to obtain persons whose knowledge and experience in one or more of the fields of State or local government, the building of rental and cooperative housing projects, or the promotion or development of such projects, would be of assistance in the administration of the program authorized by this Act. From the members appointed to such committee the Board shall designate a chairman. The committee shall meet on the call of the Board which shall be not less than twice during each calendar year. (2) Members of the advisory committee shall be entitled to receive compensation at a rate to be fixed by the Board, but not exceeding $50 per diem, and |