TITLE IV-HOUSING FOR LOW-INCOME FAMILIES

LOW-RENT PUBLIC HOUSING

Eligibility of displaced individuals

Section 401(a), (b), and (c) amends sections 2(2), 10(g)(2), and 15(7)(b), respectively, of the U.S. Housing Act of 1937 to make individual low-income displaced persons eligible for admission to lowrent housing regardless of age or disability status. A local housing authority shall accord families an admission priority over individuals where necessary to avoid undue hardship.

Additional subsidy for urban renewal and low-rent housing displacees

Section 402 amends section 10(a) of the 1937 act to authorize a special subsidy, similar to the present special subsidy for the elderly, of up to $120 per year per unit for units occupied by families and individuals displaced from urban renewall or public housing sites when the rental for such units is less than that which would normally be charged were they leased to low-income families which were neither elderly nor displaced.

Increase in authorization for annual contributions

Section 403 amends section 10(e) of the 1937 act to increase by $30,250,000 the limit on contracts for annual contributions of low-rent public housing in order to authorize approximately 37,500 additional units.

Payments in lieu of taxes by local housing authorities; local contributions

Section 404 amends section 10(h) of the 1937 act, which requires tax exemption for low-rent housing projects but permits a limited payment in lieu of taxes by the local public housing agency, in order to eliminate the provision which prohibited any payment in lieu of taxes that would reduce the value of the tax exemption to less than 20 percent of the Federal contribution. Under this section, payments in lieu of taxes may be set at 10 percent of shelter rents in all cases, even though the value of tax exemption, when reduced by the payment, would be less than 20 percent of the Federal contribution because of the low tax rates which prevail in some localities, particularly small towns.

Relocation of families and individuals displaced from project sites

Section 405 amends section 15(7) (b) of the 1937 act to establish for the low-rent housing program the same basic requirements for relocating displaced families and individuals as those which are applicable under the urban renewal law (as amended by sec. 305(a) of this act, supra). Under these requirements there would have to be a feasible method for relocating the individuals and families to be displaced from project sites, and enough decent, safe, and sanitary housing of suitable type and location to meet their needs.

Relocation payments

Section 406 adds to section 15 of the 1937 act a new paragraph (8), providing relocation payments to families, individuals, businesses, and nonprofit organizations displaced from low-rent housing project sites. These payments can be made on the same basis and subject to the same limitations as relocation payments under section 114 of the Housing Act of 1949 (as amended by sec. 310 of the Housing Act of 1964). They can be made only where similar payments are not otherwise authorized under Federal law. Their cost will be included with development costs in computing the amount of the annual contributions for the project involved, but will be separately stated aş relocation costs.

LOW-INCOME HOUSING DEMONSTRATION PROGRAM

Low-income housing demonstration program authorization

Section 407 amends section 207 of the Housing Act of 1961 to increase from $5 to $10 million the amount authorized for grants by the Housing Administrator to assist in developing and demonstrating new and improved means of providing housing for lowincome persons and families (including handicapped families, under the amendment made by sec. 203 (e) of this act, supra).

TITLE V-RURAL HOUSING

Extension of rural housing programs

Section 501 amends sections 511, 512, 513, and 515 of title V of the Housing Act of 1949 to extend certain rural housing programs' until September 30, 1965.

In addition, this section authorizes an additional $150 million for the program of direct housing loans administered by the Farmers Home Administration. In addition this section increases from $100,000 to $300,000 the maximum amount of a loan which may be insured under section 515(b) of the 1949 act for rental housing and related facilities for elderly persons and elderly families in rural areas. Definition of domestic farm labor

Section 502 amends section 514(f) (3) of the 1949 act and redefines "domestic farm labor" to make immigrant farm laborers permanently residing in the United States after legal entry for permanent residence, as well as citizen farm laborers, eligible to occupy housing financed with loans under that section.

Low-rent housing for domestic farm labor

Section 503 amends title V of the 1949 act by adding a new section which authorizes grants of up to two-thirds of the cost of providing low-rent housing for domestic farm labor. Grants may be made upon the application of a State or political subsivision thereof, or any public or private nonprofit organization. The applicant must agree (1) not to charge rentals exceeding amounts approved by the Secretary, (2) to maintain the housing at all times in a safe and sanitary condition, and (3) to give domestic farm labor an absolute priority for occupancy. Up to $10 million is authorized for this new program for the period ending September 30, 1965.

TITLE VI-COMMUNITY FACILITIES

Public facility loans

Section 601 amends section 202 (a) of the Housing Amendments of 1955 to (1) make clear that instrumentalities of one or more States and instrumentalities of municipalities or other political subdivisions in one or more States are not precluded from receiving assistance under the public facility loans program if otherwise eligible, (2) make eligible for a public facility loan any community having a population less than 150,000 and which has been designated as a redevelopment area under section 5 of the Area Redevelopment Act, and (3) make financial assistance under the public facility loans program available to any public agency or instrumentality serving one or more municipalities, political subdivisions, or unincorporated areas in one or more States without regard to the aggregate population of the communities which it is serving, so long as each of these communities is within the existing population limits of the program.

Advances for public works planning

Section 602 (a) amends section 702 (e) of the Housing Act of 1954 to require that all repayments and other receipts received after June 30, 1964, in connection with advances made under the first advance planning program (title V of the War Mobilization and Reconversion Act of 1944) and the second advance planning program (the act of October 13, 1949) shall hereafter be placed in the revolving fund established under the third program (sec. 702) rather than in the revolving fund for liquidating programs established by title II of the Independent Offices Appropriation Act of 1955, as previously required. All advances (and claims in connection with advances) outstanding as of June 30, 1964, under the first and second advance planning programs will also be included in the revolving fund for the third program. The appropriation of an additional $20 million to the section 702 revolving fund is authorized.

Subsection (b) adds to section 702 of the 1954 act a new subsection (h), providing that a public agency which constructs only a portion of a public work planned with an advance under any of the three programs need repay only such portion of the advance as the Housing and Home Finance Administrator determines to be equitable. The new subsection (h) also authorizes the Administrator to terminate all or any portion of a public agency's liability to repay an advance made under any of the three programs upon terms and conditions which he deems equitable, and to terminate any agreement for such an advance whenever he determines that there is no reasonable likelihood that the public work planned will be constructed.

Subsection (c) amends section 702 of the 1954 act to make Indian tribes eligible for public works planning advances under the section 702 program.

Subsection (d) amends section 702(f) of the 1954 act to increase by $50,000 the amount available annually to the Administrator to conduct surveys of the status and current volume of State and local public works planning.

Subsection (e) amends section 702(a) of the 1954 act to make it clear that advances may be made under the section 702 program for the planning of medical centers.

Subsection (f) amends section 702(b) of the 1954 act to eliminate the requirement that each applicant for a planning advance establish a separate planning account into which the funds from advances were placed.

TITLE VII-FEDERAL NATIONAL MORTGAGE ASSOCIATION

Pooling of mortgages for sale

Section 701 (a) amends section 302 of the National Housing Act to add a new subsection (c) which vests FNMA with fiduciary powers and enables FNMA to sell beneficial interests or participations in first mortgages (or interests therein) in which the United States has a financial interest. FNMA, in its ordinary corporate capacity, is authorized to guarantee these beneficial interests or participations, and the instruments so guaranteed evidencing these beneficial interests or participations are exempted from SEC laws.

Subsection (b) amends sections 304 (b), 306(b), 310 and 311 of such act to include the types of instruments issued by FNMA in a fiduciary capacity among the obligations of FNMA that are legal investments for trusts and public funds.

Subsection (c) amends section 5136 of the Revised Statutes to exclude instruments issued by FNMA in a fiduciary capacity from the limitations imposed by Federal banking laws. As a result, national and other affected banks will be able to deal in, underwrite, and purchase for their own account participations and other instruments issued by FNMA in a fiduciary capacity, as they do now with respect to FNMA obligations.

Subsection (d) amends section 11 (h), and section 16 of the Federal Home Loan Bank Act to permit investment of surplus and reserve funds of Federal home loan banks in instruments issued by FNMA in its fiduciary capacity.

Subsection (e) amends pertinent provisions of section 1820 of chapter 37, title 38, United States Code, dealing with the GI loan program administered by the Veterans' Administration, so as to provide authority for the Veterans' Administration to join in the financing arrangements authorized by this section with respect to VA-held first mortgages and installment sales contracts. This subsection also provides for disposition of the proceeds received by VA from the sale of participations. The ownership of VA's mortgages and installment sales contracts, as well as the servicing and management of such mortgages and contracts, will remain in the VA unless there is a default as to the related participations.

This subsection also amends section 1823 of title 38, of such Code, to make it clear that the time limit imposed by that section for return to the Treasury of all sums in the VA direct loan revolving fund upon completion of the direct loan program will not prevent maintenance of a reasonable reserve for meeting commitments arising out of the new financing arrangements contemplated by this title. Removal of $20,000 mortgage amount limitation

Section 702 amends section 302(b) of the National Housing Act to eliminate the statutory limit of $20,000 per family residence or dwelling unit on the amount of a mortgage purchased by FNMA in it secondary market operations. (The $17,500 limit on mortgages

purchased under FNMA's special assistance functions, and the exemptions for mortgages insured under sec. 213, sec. 220, and title VIII and for mortgages on properties in Alaska, Guam, and Hawaii, are not changed.)

FNMA-90 percent loans

Section 703 amends section 304 (a) (2) of such act to permit FNMA, under its secondary market operations, to make short-term loans on the security of insured or guaranteed mortgages if the loans do not exceed 90 percent (rather than 80 percent as previously provided) of the unpaid principal amounts of the mortgages securing the loans. FNMA-Purchase of participations

Section 704 repeals section 304 (d) of such act in order to permit FNMA, under its secondary market operations, to purchase, sell, and deal otherwise in participations in insured and guaranteed mortgages. Section 304 (d) previously prohibited such transactions by FNMA.

TITLE VIII-TRAINING AND FELLOWSHIP PROGRAMS

PART 1-FEDERAL-STATE TRAINING PROGRAMS

This part establishes a new system of Federal-State training programs designed to develop the skills needed for economic and efficient community development and to provide new and improved methods of dealing with community development problems.

Findings and purpose

Section 801(a) states the finding of Congress that rapid urban expansion has caused severe problems in urban and suburban development and has created a national need for training in skills needed for economic and efficient community development and for research in methods of dealing with community development problems.

Subsection (b) declares it to be the purpose of the law to assist and encourage the States, in cooperation with colleges, universities, and urban centers, to develop programs which will provide this training to technical and professional people who are or are training to be employed by a public body having community development responsibilities, and to support State and local research in connection with all community development problems.

Matching grants to States

Section 802(a) authorizes the Housing and Home Finance Administrator to make grants to States to assist in carrying out the stated purposes of the law.

Subsection (b) requires a State, in order to receive such a grant, to secure the Administrator's approval of a State plan setting forth the proposed use of the funds and the objectives to be accomplished, indicating the method by which the required non-Federal financing will be obtained, providing fiscal control and accounting procedures, designating the State officer or agency to administer the program, and providing for appropriate reports.

Subsection (c) requires that each Federal grant be matched by at least an equal amount for non-Federal sources for the same purpose and for concurrent use.