    [Appendix]
    [Detailed Budget Estimates by Agency]
    [Department of Housing and Urban Development]
    [From the U.S. Government Printing Office, www.gpo.gov]

                         THE BUDGET FOR FISCAL YEAR 1998

    [[Page 529]]

                   DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

        This chapter presents the budget and program estimates for the
    Department of Housing and Urban Development (HUD).

        For the past 4 years, the Department has been engaged in a
    reinvention process which has emphasized: addressing homelessness
    through comprehensive continuum of care strategies; transforming public
    and assisted housing; enhancing homeownership opportunities through new
    national and local partnerships; reducing racial barriers to housing;
    and, encouraging locally-driven solutions and leveraging private sector
    investment through initiatives like consolidated planning, and
    Empowerment Zones and Enterprise Communities. An emphasis has also been
    placed on reinventing HUD, itself. The 1998 budget continues to move
    toward a ``right-side up'' Cabinet Department that is organized,
    staffed, and empowered to respond to locally driven priorities rather
    than Federal dictates.

        As part of the 1997 reinvention process, the Department proposed
    consolidating many of its programs into three core funds--with
    incentives for good performance. The 1997 Appropriations Act did not
    implement the Department's proposals but did enact a major
    reconfiguration of the Department's housing accounts structure. Three
    new accounts were created: Preserving Existing Housing Investment,
    Development of Additional New Subsidized Housing, and Prevention of
    Resident Displacement.

        This new account structure was an important first step to better
    organizing the Department's primary housing assistance programs. The
    1998 budget further refines this structure to reflect the Department's
    consolidation efforts. This new structure will also enhance the
    Department's ability to administer and track its funds.

        Activities funded under the Preserving Existing Housing Investment
    account will be divided into two separate accounts--an operating fund
    and a capital fund. Assistance provided for the elderly and disabled,
    and Native Americans in the Development of Additional New Subsidized
    Housing account in 1997 is being requested separately for 1998. Funds
    for the elderly and disabled are in the Housing for Special Populations
    account in 1998 and resources allocated to the Native American
    population will be consolidated under a Native American Housing Block
    Grants program as authorized by the 104th Congress. Funding for housing
    certificates, Section 8 contract renewals, and amendments in 1997 was
    provided in the Prevention of Resident Displacement account. This budget
    proposes to fund these activities under the Housing Certificate Fund for
    1998.

        The 1998 Budget includes two Presidential initiatives related to
    revitalizing America's urban areas. First, the HUD Budget requests
    funding for a second round of Empowerment Zones and Enterprise
    Communities. The first round has already proven successful in leveraging
    private sector funds and promoting economic opportunity and community-
    wide revitalization. Second, the Brownfields Redevelopment program will
    enable cities to clean up polluted sites, returning them to productive
    uses that create jobs. The program will also enable cities to address
    the economic development needs of communities in and around such sites.

        The 1998 Budget maintains Community Development Block Grant (CDBG)
    funding. This program will continue to use a formula approach for
    allocating funds for a wide range of community and economic development
    activities. The Community Development Loan Guarantee program enables
    communities to borrow in the private market with a Federal guarantee.
    Communities must develop consolidated plans which identify local needs
    and priorities in order to tap into CDBG and other HUD funds.

        The HOME Investment Partnerships program will also continue formula
    allocations to states and participating jurisdictions to assist in
    expanding the supply of affordable housing.

        The Homeless Assistance Grants program would consolidate HUD's six
    Stewart B. McKinney homeless assistance programs into a performance-
    based program that would enable communities to continue their
    development and implementation of comprehensive, coordinated continuum
    of care systems to address the needs of homeless people and families.
    This is the fourth consecutive year that HUD has sought consolidation of
    its homeless assistance programs to improve program administration and
    effectiveness.

        Funding is also included, either as set-asides or as separate
    programs, for the following community and economic development and
    affordable housing programs: Economic Development Grants; Homeownership
    Zones; Habitat for Humanity; Youthbuild; Bridges to Work; and Capacity
    Building for Community Development and Affordable Housing.

        The Department is reproposing to consolidate several categorical
    housing programs.

         The Public Housing Operating Fund would fund the operating
    costs of Public Housing. Through this fund, Public Housing Agencies will
    have greater flexibility in attracting and retaining low- and moderate-
    income families.

         The Public Housing Capital Fund would address the capital
    needs of Public Housing. Based on the Public Housing Modernization
    program, this Fund will permit the upgrading of inventory and the
    demolition and replacement of obsolete buildings. Funds will also be
    available for: economic development supportive services; technical
    assistance and intervention to improve troubled authorities and
    management improvements; and the Tenant Opportunity Program.

         The Housing Certificate Fund would address the problems
    arising from lagging household income and high housing costs. The Fund
    would be based on the existing voucher and certificate programs with
    changes to make the system simpler and more effective. Funding for
    section 8 contract renewals and amendments is included within this Fund.
    The 1998 request includes 50,000 incremental certificates to help low-
    income families move from welfare to work.

         Other Housing Programs. Lead-paint hazard reduction
    activities will be funded within the Community Development Block Grant
    Fund. Several other programs that assist communities will remain as
    free-standing activities: Housing Opportunities for Persons with AIDS,
    Youthbuild, housing counseling, drug elimination activities, and
    assistance for severely distressed public housing.

        A major initiative reflected in the budget estimates is
    ``Multifamily Portfolio Reengineering,'' formerly known as ``Mark-to-
    Market.'' This plan would reduce over-subsidized Section 8 contracts and
    FHA-insured debt on properties. The goal of the initiative is to leave
    all responsible owners with the ability to sustain the remaining
    mortgage through the payment of market-derived rents by tenants.

    [[Page 530]]

                            PUBLIC AND INDIAN HOUSING

                                  Federal Funds

    General and special funds:

         [Prevention of Resident Displacement] Housing Certificate Fund

        For activities and assistance to prevent the involuntary
    displacement of low-income families, the elderly and the disabled
    because of the loss of affordable housing stock, expiration of subsidy
    contracts (other than contracts for which amounts are provided under the
    head ``Preserving Existing Housing Investment'') or expiration of use
    restrictions, or other changes in housing assistance arrangements, and
    for other purposes, [$4,640,000,000] $10,676,000,000, to remain
    available until expended: Provided, That of the total amount provided
    under this head, [$3,600,000,000] $9,232,000,000 shall be for assistance
    under the United States Housing Act of 1937 (42 U.S.C. 1437) for use in
    connection with expiring or terminating section 8 subsidy contracts:
    Provided further, That the Secretary may determine not to apply section
    8(o)(6)(B) of the Act to housing vouchers during fiscal year [1997]
    1998: Provided further, That of the total amount provided under this
    head, $850,000,000 shall be for amendments to section 8 contracts other
    than contracts for projects developed under section 202 of the Housing
    Act of 1959, as amended: Provided further, That of the total amount
    provided under this head, [$190,000,000] $594,000,000 shall be for
    section 8 rental assistance under the United States Housing Act [of 1937
    (42 U.S.C. 1437)] including assistance to relocate residents of
    properties (i) that are owned by the Secretary and being disposed of or
    (ii) that are discontinuing section 8 project-based assistance; [or
    (iii) or subject to special workout assistance team intervention
    compliance actions;] for the conversion of section 23 projects to
    assistance under section 8; for funds to carry out the family
    unification program; and for the relocation of witnesses in connection
    with efforts to combat crime in public and assisted housing pursuant to
    a request from a law enforcement or prosecution agency [: Provided
    further, That of the total amount made available under this head,
    $50,000,000 shall be made available to nonelderly disabled families
    affected by the designation of a public housing development under
    section 7 of such Act or the establishment of preferences in accordance
    with section 651 of the Housing and Community Development Act of 1992
    (42 U.S.C. 1361l)]. (Departments of Veterans Affairs and Housing and
    Urban Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0311-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Renew rental contracts............                   1,956       9,997
    00.02 Contract amendments...............                     900         850
    00.03 New housing certificates..........                     240         594
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................                   3,096      11,441
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................                               1,594
    22.00 New budget authority (gross)......                   4,690      10,676
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......                   4,690      11,441
    23.95 New obligations...................                  -3,096     -11,441
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....                   1,594         829
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                   4,640      10,676
    42.00 Transferred from other accounts...                      50
                                               ---------   ---------  ----------
    43.00   Appropriation (total)...........                   4,690      10,676
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................                   4,690      10,676
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation                               1,364
    73.10 New obligations...................                   3,096      11,441
    73.20 Total outlays (gross).............                  -1,732      -5,604
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                   1,364       7,201
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                   1,732       3,985
    86.93 Outlays from current balances.....                               1,619
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........                   1,732       5,604
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                   4,690      10,676
    90.00 Outlays...........................                   1,732       5,604
    ---------------------------------------------------------------------------

        This account provides funding for some of the activities previously
    funded through the Annual Contributions for Assisted Housing account.
    These include the renewal of expiring Section 8 contracts, amending of
    Section 8 contracts, and the funding for additional Section 8 rental
    assistance.

                    Annual Contributions For Assisted Housing

        All balances remaining in the Preserving Existing Housing Investment
    Account for Preservation shall be transferred to and merged with the
    amounts previously provided for those purposes under this head.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0164-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Lower income housing..............       1,964       3,010
    00.02 Public and Indian housing.........       2,907       1,695
    00.03 Elderly/disabled grants...........       1,469       3,684
    00.04 Other programs....................         267          28
    00.05 Contract renewals.................       3,345       1,892
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................       9,952      10,309
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

            Uninvested balance:
    21.40     Uninvested balance............         387       1,981
    21.40     Uninvested balance............      11,153       8,030
    21.49   Contract authority..............          73          88
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............      11,613      10,099
    22.00 New budget authority (gross)......       9,819         -75
    22.10 Resources available from
            recoveries of prior year
            obligations.....................      11,266         325
    22.21 Unobligated balance transferred to
            other accounts..................                     -41
    22.75 Balance of contract authority
            withdrawn.......................     -12,646
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......      20,052      10,308
    23.95 New obligations...................      -9,952     -10,309
          Unobligated balance available, end of year:

            Uninvested balance:
    24.40     Uninvested balance............       1,981
    24.40     Uninvested balance............       8,030
    24.49   Contract authority..............          88
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................      10,099
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................       9,819
    41.00   Transferred to other accounts...                     -75
                                               ---------   ---------  ----------
    43.00     Appropriation (total).........       9,819         -75
          Permanent:

    60.05   Appropriation (indefinite)......         632      19,848      15,541
    60.49   Portion applied to liquidate
              contract authority............        -632     -19,848     -15,541
                                               ---------   ---------  ----------
    63.00     Appropriation (total).........
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................       9,819         -75
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

            Obligated balance:
    72.40     Appropriation.................      60,721      38,135      49,356
    72.49     Contract authority............      69,331      56,034      36,236
    72.90     Fund balance..................          24      14,265      12,614
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............     130,076     108,434      98,206
    73.10 New obligations...................       9,952      10,309
    73.20 Total outlays (gross).............     -20,327     -19,847     -15,912

    [[Page 531]]

    73.31 Obligated balance transferred to
            other accounts..................                    -367
    73.45 Adjustments in unexpired accounts.     -11,266        -325
          Unpaid obligations, end of year:

            Obligated balance:
    74.40     Appropriation.................      38,135      49,356      51,184
    74.49     Contract authority............      56,034      36,236      20,695
    74.90     Fund balance..................      14,265      12,614      10,415
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................     108,434      98,206      82,294
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority       1,019
    86.93 Outlays from current balances.....      19,308      19,847      15,912
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........      20,327      19,847      15,912
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................       9,819         -75
    90.00 Outlays...........................      20,327      19,847      15,912
    ---------------------------------------------------------------------------

                     Summary of Budget Authority and Outlays

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Enacted/requested:
      Budget Authority..................       9,819         -75
      Outlays...........................      20,327      19,847      15,912
    Legislative proposal, not subject to
        PAYGO:
      Budget Authority..................                                -855
      Outlays...........................                                -375
    Rescission proposal:
      Budget Authority..................                    -250
      Outlays...........................                     -10         -25
                                        ------------------------------------
    Total:
      Budget Authority..................       9,819        -325        -855
      Outlays...........................      20,327      19,837      15,512
                                        ====================================

                Status of Contract Authority (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0164-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    0100  Balance, start of year............          73          88
    0100  Balance, start of year............      69,331      56,034      36,236
    0340  Unobligated balance transferred...                     -41
    0400  Appropriation to liquidate
            contract authority..............        -632     -19,848     -15,541
    0600  Balance of contract authority
            withdrawn.......................     -12,646
        Balance, end of year:
    0700  Balance, end of year..............          88
    0700  Balance, end of year..............      56,034      36,236      20,695
    ---------------------------------------------------------------------------

        The Annual Contributions for Assisted Housing account provided
    assistance under three major categories.

        Low-income housing (section 8).--Included within the section 8
    category were incremental rental assistance in the form of housing
    certificates and housing vouchers; Public Housing and Housing
    Relocation/Replacement opt-out units; Housing Opportunities for Persons
    with AIDS; section 23 conversions; and loan management and property
    disposition activities.

        Housing for the elderly and disabled (section 202 and 811).--The
    Cranston-Gonzales National Affordable Housing Act authorized a grant
    program to make new construction assistance available to elderly and
    disabled persons. Both the grant funding and the Rental Assistance--or
    operating subsidy--needed to aid these low-income tenants was provided
    under the annual contributions account.

        Public and Indian housing.--New development funding was provided for
    both Public Housing and for Indian Housing within this account. In
    addition, funding was provided for public and indian housing
    modernization activities and public/indian housing amendments and lease
    adjustments. Funding was also provided for Public Housing Service
    Coordinators and Family Investment Centers.

        The Annual Contributions for Assisted Housing account provided
    funding for a wide range of housing assistance through the Low-Income
    Housing (Section 8), Housing for the Elderly and Disabled, and the
    Public and Indian Housing programs. In addition, various housing-related
    programs were carried out through funding provided under this account.
    Consistent with HUD's reinvention process, many of these activities will
    be funded under the new consolidated Funds being proposed for 1998.

        No new appropriation is requested for this account. Language is
    proposed to permit the transfer into this account of all unobligated and
    obligated balances for preservation assistance, which was previously
    made available in 1997 under the Preserving Existing Housing Investment
    account (See table below).

                          Proposed Transfer of Balances

                                  [In millions]

                                         1996 Actual  1997 est.   1998 est.
    Annual Contributions:
      Budget Authority..................       9,819       (325)       (855)
      Outlays...........................      20,327      19,837      15,512
    Preserving Existing Housing
        Investment:
      Budget Authority..................                     350
      Outlays...........................                     140         210
                                        ------------------------------------
          Total.........................
      Budget Authority..................       9,819          25       (855)
      Outlays...........................      20,327      19,977      15,722
                                        ====================================

        The 1998 budget proposes to transfer all preservation balances to
    the Annual Contributions for Assisted Housing account.

                    Annual Contributions for Assisted Housing

                  (Legislative proposal, not subject to PAYGO)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0164-2-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                                -855
    22.10 Resources available from
            recoveries of prior year
            obligations.....................                                 855
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................
    40.35 Appropriation rescinded...........                                -855
                                               ---------   ---------  ----------
    43.00   Appropriation (total)...........                                -855
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................                                -855
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.20 Total outlays (gross).............                                 375
    73.45 Adjustments in unexpired accounts.                                -855
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                                -480
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....                                -375
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                -855
    90.00 Outlays...........................                                -375
    ---------------------------------------------------------------------------

        An estimated $855 million of budget authority is anticipated to be
    recaptured and canceled in 1998 as a result of enactment and
    implementation of HUD's Multifamily Portfolio Reengineering proposal.
    This proposal would restructure mortgages of selected FHA-insured
    multifamily properties. These properties are presently subsidized at
    above market rates through HUD's rental assistance programs. Budget
    authority remaining on these long-term, multi-year contracts would be
    canceled. In the future, additional outlay savings will be achieved by
    avoiding the need for appropriations for funds to continue subsidizing
    these high-cost contracts.

    [[Page 532]]

                     Preserving Existing-Housing Investment

        [For operating, maintaining, revitalizing, rehabilitating,
    preserving, and protecting existing housing developments for low-income
    families, and the elderly, and the disabled, $5,750,000,000, to remain
    available until expended: Provided, That of the total amount made
    available under this head, $2,900,000,000 shall be available for
    payments to public housing agencies and Indian housing authorities for
    operating subsidies for low-income housing projects as authorized by
    section 9 of the United States Housing Act of 1937, as amended (42
    U.S.C. 1437g): Provided further, That of the total amount made available
    under this head, $2,500,000,000 shall be available for modernization of
    existing public housing projects as authorized under section 14 of the
    United States Housing Act of 1937, as amended (42 U.S.C. 1437l), of
    which $10,000,000 shall be for carrying out activities under section
    6(j) of the United States Housing Act of 1937 and technical assistance
    for the inspection of public housing units, contract expertise, and
    training and technical assistance directly or indirectly, under grants,
    contracts, or cooperative agreements, to assist in the oversight and
    management of public and Indian housing (whether or not the housing is
    being modernized with assistance under this proviso) or tenant-based
    assistance, including, but not limited to, an annual resident survey,
    data collection and analysis, training and technical assistance by or to
    officials and employees of the department and of public housing agencies
    and to residents in connection with the public and Indian housing
    program: Provided further, That of the total amount provided under this
    head, $350,000,000 shall be available for use in conjunction with
    properties that are eligible for assistance under the Low-Income Housing
    Preservation and Resident Homeownership Act of 1990 (LIHPRHA) or the
    Emergency Low Income Housing Preservation Act of 1987 (ELIHPA), of which
    $75,000,000 shall be available for obligation until March 1, 1997 for
    projects (1) that are subject to a repayment or settlement agreement
    that was executed between the owner and the Secretary prior to September
    1, 1995; (2) whose submissions were delayed as a result of their
    location in areas that were designated as a Federal disaster area in a
    Presidential Disaster Declaration; or (3) whose processing was, in fact
    or in practical effect, suspended, deferred, or interrupted for a period
    of twelve months or more because of differing interpretations, by the
    Secretary and an owner or by the Secretary and a State or local rent
    regulatory agency, concerning the timing of filing eligibility or the
    effect of a presumptively applicable State or local rent control law or
    regulation on the determination of preservation value under section 213
    of LIHPRHA, as amended, if the owner of such project filed notice of
    intent to extend the low-income affordability restrictions of the
    housing, or transfer to a qualified purchaser who would extend such
    restrictions, on or before November 1, 1993; and of which, up to
    $100,000,000 may be used for rental assistance to prevent displacement
    of families residing in projects whose owners prepay their mortgages;
    and the balance of which shall be available from the effective date of
    this Act for sales to preferred priority purchasers: Provided further,
    That with the exception of projects described in clauses (1), (2), or
    (3) of the preceding proviso, the Secretary shall, notwithstanding any
    other provision of law, suspend further processing of preservation
    applications which have not heretofore received approval of a plan of
    action: Provided further, That $150,000,000 of amounts recaptured from
    interest reduction payment contracts for section 236 projects whose
    owners prepay their mortgages during fiscal year 1997 shall be
    rescinded: Provided further, That an owner of eligible low-income
    housing may prepay the mortgage or request voluntary termination of a
    mortgage insurance contract, so long as said owner agrees not to raise
    rents for sixty days after such prepayment: Provided further, That such
    developments have been determined to have preservation equity at least
    equal to the lesser of $5,000 per unit or $500,000 per project or the
    equivalent of eight times the most recently published monthly fair
    market rent for the area in which the project is located as the
    appropriate unit size for all of the units in the eligible project:
    Provided further, That the Secretary may modify the regulatory agreement
    to permit owners and priority purchasers to retain rental income in
    excess of the basic rental charge in projects assisted under section 236
    of the National Housing Act, for the purpose of preserving the low- and
    moderate-income character of the housing: Provided further, That
    eligible low-income housing shall include properties meeting the
    requirements of this paragraph with mortgages that are held by a State
    agency as a result of a sale by the Secretary without insurance, which
    immediately before the sale would have been eligible low-income housing
    under LIHPRHA: Provided further, That notwithstanding any other
    provision of law, subject to the availability of appropriated funds,
    each low-income family, and moderate-income family who is elderly or
    disabled or is residing in a low-vacancy area, residing in the housing
    on the date of prepayment or voluntary termination, and whose rent, as a
    result of a rent increase occurring no later than one year after the
    date of the prepayment, exceeds 30 percent of adjusted income, shall be
    offered tenant-based assistance in accordance with section 8 or any
    successor program, under which the family shall pay no less for rent
    than it paid on such date: Provided further, That any family receiving
    tenant-based assistance under the preceding proviso may elect (1) to
    remain in the unit of the housing and if the rent exceeds the fair
    market rent or payment standard, as applicable, the rent shall be deemed
    to be the applicable standard, so long as the administering public
    housing agency finds that the rent is reasonable in comparison with
    rents charged for comparable unassisted housing units in the market or
    (2) to move from the housing and the rent will be subject to the fair
    market rent of the payment standard, as applicable, under existing
    program rules and procedures: Provided further, That the tenant-based
    assistance made available under the preceding two provisos are in lieu
    of benefits provided in subsections 223(b), (c), and (d) of the Low-
    Income Housing Preservation and Resident Homeownership Act of 1990:
    Provided further, That any sales shall be funded using the capital grant
    available under section 220(d)(3)(A) of LIHPRHA: Provided further, That
    any extensions shall be funded using a non-interest-bearing capital
    (direct) loan by the Secretary not in excess of the amount of the cost
    of rehabilitation approved in the plan of action plus 65 percent of the
    property's preservation equity and under such other terms and conditions
    as the Secretary may prescribe: Provided further, That any capital grant
    shall be limited to seven times, and any capital loan limited to six
    times, the annual fair market rent for the project, as determined using
    the fair market rent for fiscal year 1997 for the area in which the
    project is located, using the appropriate apartment sizes and mix in the
    eligible project, except where, upon the request of a priority
    purchaser, the Secretary determines that a greater amount is necessary
    and appropriate to preserve low-income housing: Provided further, That
    section 241(f) of the National Housing Act is repealed and insurance
    under such section shall not be offered as an incentive under LIHPRHA
    and ELIHPA: Provided further, That up to $10,000,000 of the amount of
    $350,000,000 made available by a preceding proviso in this paragraph may
    be used at the discretion of the Secretary to reimburse owners of
    eligible properties for which plans of action were submitted prior to
    the effective date of this Act, but were not executed for lack of
    available funds, with such reimbursement available only for documented
    costs directly applicable to the preparation of the plan of action as
    determined by the Secretary, and shall be made available on terms and
    conditions to be established by the Secretary: Provided further, That,
    notwithstanding any other provision of law, a priority purchaser may
    utilize assistance under the HOME Investment Partnerships Act or the Low
    Income Housing Tax Credit: Provided further, That projects with approved
    plans of action which exceed the limitations on eligibility for funding
    imposed by this Act may submit revised plans of action which conform to
    these limitations by March 1, 1997, and retain the priority for funding
    otherwise applicable from the original date of approval of their plan of
    action, subject to securing any additional necessary funding commitments
    by August 1, 1997.] (Departments of Veterans Affairs and Housing and
    Urban Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0312-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                   5,750
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                   5,750
    23.95 New obligations...................                  -5,750
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                   5,750
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation                               4,218

    [[Page 533]]

    73.10 New obligations...................                   5,750
    73.20 Total outlays (gross).............                  -1,532      -1,962
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                   4,218       2,256
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                   1,532
    86.93 Outlays from current balances.....                               1,962
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........                   1,532       1,962
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                   5,750
    90.00 Outlays...........................                   1,532       1,962
    ---------------------------------------------------------------------------

                           Public Housing Capital Fund

                         (including transfers of funds)

        For the Public Housing Capital Fund Program under the United States
    Housing Act of 1937, as amended (42 U.S.C. 1437), $2,500,000,000, to
    remain available until expended for modernization of existing public
    housing projects as authorized under section 14 of such Act, of which
    $50,000,000 shall be available for grants to public housing agencies,
    non-profit corporations, and other appropriate entities for a supportive
    services program to assist residents of public and assisted housing,
    former residents of such housing receiving tenant-based assistance under
    section 8 of such Act (42 U.S.C. 1437f), and other low-income families
    and individuals to become self-sufficient: Provided, That the program
    shall provide supportive services, principally for the benefit of public
    housing residents, to the elderly and the disabled, and to families with
    children where the head of household would benefit from the receipt of
    supportive services and is working, seeking work, or is preparing for
    work by participating in job training or educational programs: Provided
    further, That the supportive services may include congregate services
    for the elderly and disabled, service coordinators, and coordinated
    educational, training, and other supportive services, including academic
    skills training, job search assistance, assistance related to retaining
    employment, vocational and entrepreneurship development and support
    programs, transportation, and child care: Provided further, That the
    Secretary shall require applicants to demonstrate firm commitments of
    funding or services from other sources: Provided further, That the
    Secretary shall select public and Indian housing agencies to receive
    assistance under this head on a competitive basis, taking into account
    the quality of the proposed program. Provided further, That of the total
    amounts, $45,000,000 shall be for carrying out activities under section
    6(j) of such Act and technical assistance for the inspection of public
    housing units, contract expertise, and training and technical assistance
    directly or indirectly, under grants, contracts, or cooperative
    agreements, to assist in the oversight and management of public housing
    (whether or not the housing is being modernized with assistance under
    this proviso) or tenant-based assistance, including, but no limited to,
    an annual resident survey, data collection and analysis, training and
    technical assistance by or to officials and employees of the department
    and of public housing agencies and to residents in connection with the
    public housing program and for lease adjustments to section 23 projects;
    Provided further, That of the total amount, $5,000,000 shall be for
    activities currently eligible under the Tenant Opportunity program:
    Provided, That all balances, as of September 30, 1997, of funds
    heretofore provided (other than for Indian families) for the development
    or acquisition costs of public housing, for modernization of existing
    public housing projects, for public housing amendments, for public
    housing modernization and development technical assistance, for lease
    adjustments under the section 23 program, and for the Family Investment
    Centers program, shall be transferred to and merged with amounts made
    available under this heading.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0304-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                               2,500
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                               2,500
    23.95 New obligations...................                              -2,500
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                               2,500
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation
    73.10 New obligations...................                               2,500
    73.20 Total outlays (gross).............                                 -13
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                               2,487
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                                  13
    86.93 Outlays from current balances.....
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........                                  13
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                               2,500
    90.00 Outlays...........................                                  13
    ---------------------------------------------------------------------------

                          Proposed Transfer of Balances

                                  [In millions]

                                         1996 Actual  1997 est.   1998 est.
    Annual Contributions:
      Budget Authority..................       2,711
      Outlays...........................       4,548       4,296       3,579
    Preserving Existing Housing
        Investment:
      Budget Authority..................                   2,500
      Outlays...........................                       0         276
    Public Housing Capitol Fund:
      Budget Authority..................                               2,500
      Outlays...........................                                  13
                                        ------------------------------------
          Total.........................
      Budget Authority..................       2,711       2,500       2,500
      Outlays...........................       4,548       4,296       3,868
                                        ====================================

        The 1998 budget proposes to transfer all Modernization/Development
    balances to the Public Housing Capital Fund.

                          Public Housing Operating Fund

                         (including transfers of funds)

        For payments to public housing agencies for operating subsidies for
    low-income housing projects as authorized by section 9 of the United
    States Housing Act of 1937, as amended (42 U.S.C. 1437g),
    $2,900,000,000, to remain available until expended: Provided, That all
    balances outstanding, as of September 30, 1997, of funds heretofore
    provided (other than for Indian families) for payments to public housing
    agencies for operating subsidies for low-income housing projects, shall
    be transferred to and merged with amounts made available under this
    heading.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0163-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Operating subsidies...............       2,800                   2,900
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................       2,800                   2,900
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......       2,800                   2,900
    23.95 New obligations...................      -2,800                  -2,900
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................       2,800                   2,900
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation       1,507       1,606          85
    73.10 New obligations...................       2,800                   2,900
    73.20 Total outlays (gross).............      -2,688      -1,521      -1,421
    73.40 Adjustments in expired accounts...         -13

    [[Page 534]]

    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation       1,606          85       1,564
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority       1,202                   1,392
    86.93 Outlays from current balances.....       1,486       1,521          29
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........       2,688       1,521       1,421
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................       2,800                   2,900
    90.00 Outlays...........................       2,688       1,521       1,421
    ---------------------------------------------------------------------------

                          Proposed Transfer of Balances

                                  [In millions]

                                         1996 Actual  1997 est.   1998 est.
    Public Housing Operating Fund:
      Budget Authority..................       2,900                   2,900
      Outlays...........................       2,688       1,521       1,421
    Preserving Existing Housing
        Investment:
      Budget Authority..................                   2,800
      Outlays...........................                   1,392       1,479
                                        ------------------------------------
          Total.........................
      Budget Authority..................       2,900       2,800       2,900
      Outlays...........................       2,688       2,913       2,900
                                        ====================================

        The 1998 budget proposes to transfer all Operating Subsidies to the
    Public Housing Operating Fund.

        Operating subsidy payments are provided to assist local Public
    Housing Agencies (PHAs) to meet certain deficits in the operation of
    PHA's. These payments are in addition to the debt service and capital
    funding provided by HUD for development and modernization of low-income
    housing.

        In 1997, funding for these activities was provided under the
    Preserving Existing Housing Investment Fund.

        Beginning in 1998, funding for these activities would be provided
    under the Public Housing Operating Fund.

        In 1998, operating subsidy payments for tribally designated housing
    entities would be provided under the Native American Housing Block Grant
    program.

                 Drug Elimination Grants for Low-Income Housing

                          (including transfer of funds)

        For grants to public and Indian housing agencies for use in
    eliminating crime in public housing projects authorized by 42 U.S.C.
    11901-11908, for grants for federally assisted low-income housing
    authorized by 42 U.S.C. 11909, and for drug information clearinghouse
    services authorized by 42 U.S.C. 11921-11925, $290,000,000, to remain
    available until expended, $10,000,000 of which shall be for grants,
    technical assistance, contracts and other assistance training, program
    assessment, and execution for or on behalf of public housing agencies,
    [and] resident organizations, Indian Tribes and their Tribally
    designated housing entities (TDHEs) (including the cost of necessary
    travel for participants in such training), [$5,000,000] $10,000,000, of
    which shall be used in connection with efforts to combat violent crime
    in public and assisted housing under the Operation Safe Home Program
    administered by the Inspector General of the Department of Housing and
    Urban Development, and [$5,000,000] $10,000,000 of which shall be
    provided to the Office of Inspector General for Operation Safe Home:
    Provided, That the term ``drug-related crime'', as defined in 42 U.S.C.
    11905(2), shall also include other types of crime as determined by the
    Secretary: Provided further, That notwithstanding section 5130(c) of the
    Anti-Drug Abuse Act of 1988 (42 U.S.C. 11909(c)), the Secretary may
    determine not to use any such funds to provide public housing youth
    sports grants. (Departments of Veterans Affairs and Housing and Urban
    Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0197-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................         243         290         290
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................          20          68          68
    22.00 New budget authority (gross)......         290         290         290
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         311         358         358
    23.95 New obligations...................        -243        -290        -290
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....          68          68          68
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................         290         290         290
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         532         516         595
    73.10 New obligations...................         243         290         290
    73.20 Total outlays (gross).............        -259        -210        -344
    73.45 Adjustments in unexpired accounts.          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         516         595         541
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....         259         210         344
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         290         290         290
    90.00 Outlays...........................         259         210         344
    ---------------------------------------------------------------------------

                     Summary of Budget Authority and Outlays

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Enacted/requested:
      Budget Authority..................         290         290         290
      Outlays...........................         259         210         344
    Supplemental proposal:
      Budget Authority..................                      30
      Outlays...........................                                   3
                                        ------------------------------------
    Total:
      Budget Authority..................         290         320         290
      Outlays...........................         259         210         347
                                        ====================================

        The $290 million requested for this program in FY 1998 includes
    funding for technical assistance for drug elimination and operation safe
    home activities.

    Revitalization of Severely Distressed Public Housing [(Hope VII)] (Hope
                                       VI)

        For grants to public housing agencies for assisting in the
    demolition of obsolete public housing projects or portions thereof, the
    revitalization (where appropriate) of sites (including remaining public
    housing units) on which such projects are located, replacement housing
    which will avoid or lessen concentrations of very low-income families,
    and tenant-based assistance in accordance with section 8 of the United
    States Housing Act of 1937; and for providing replacement housing and
    assisting tenants to be displaced by the demolition, [$550,000,000]
    $524,000,000, to remain available until expended, of which the Secretary
    may use up to $2,500,000 for technical assistance, to be provided
    directly or indirectly by grants, contracts or cooperative agreements,
    including training and cost of necessary travel for participants in such
    training, by or to officials and employees of the Department and of
    public housing agencies and to residents[: Provided, That no funds
    appropriated in this title shall be used for any purpose that is not
    provided for herein, in the Housing Act of 1937, in the Appropriations
    Acts for Veterans Affairs, Housing and Urban Development, and
    Independent Agencies, for the fiscal years 1993, 1994, and 1995, and the
    Omnibus Consolidated Rescis-

    [[Page 535]]

    sions and Appropriations Act of 1996: Provided further, That none of
    such funds shall be used directly or indirectly by granting competitive
    advantage in awards to settle litigation or pay judgments, unless
    expressly permitted herein: Provided further, That, notwithstanding any
    other provision of law, the funds made available to the Housing
    Authority of New Orleans under HOPE VI for purposes of Desire Homes,
    shall not be obligated or expended for on-site construction until an
    independent third party has determined whether the site is appropriate].
    (Departments of Veterans Affairs and Housing and Urban Development, and
    Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0218-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................          57         599         557
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................         116         539         490
    22.00 New budget authority (gross)......         480         550         524
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         596       1,089       1,014
    23.95 New obligations...................         -57        -599        -557
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....         539         490         457
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................         480         550         524
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation       1,430       1,377       1,693
    73.10 New obligations...................          57         599         557
    73.20 Total outlays (gross).............        -110        -283        -409
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation       1,377       1,693       1,841
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                                  12
    86.93 Outlays from current balances.....         110         283         397
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         110         283         409
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         480         550         524
    90.00 Outlays...........................         110         283         409
    ---------------------------------------------------------------------------

        This program provides Federal resources to rehabilitate and restore
    severely distressed public housing projects, thereby expanding the
    supply of decent, safe, and affordable housing for low-income renters.
    Funds provided to this program are in addition to the substantial
    resources provided for the public housing modernization program and are
    specifically targeted to the units in most need of attention.

                      Native American Housing Block Grants

                          (including transfer of funds)

        For the Native American Housing Block Grants program, as authorized
    under title I of the Native American Housing Assistance and Self-
    Determination Act of 1996 (Public Law 104-330), $485,000,000, to remain
    available until expended, of which $5,000,000, shall be used to support
    the inspection of Indian housing units, contract expertise, training,
    and technical assistance in the oversight and management of Indian
    housing and tenant-based assistance, including up to $200,000 for
    related travel: Provided, That all balances outstanding as of September
    30, 1997, previously appropriated under the headings ``Annual
    Contributions for Assisted Housing'', ``Development of Additional New
    Subsidized Housing'', ``Preserving Existing Housing Development'',
    ``HOME Investment Partnerships Program'', ``Emergency Shelter Grants
    Program,'' and ``Homeless Assistance Funds'', identified for Indian
    Housing Authorities and other agencies primarily serving Indian or
    Indian areas, shall be transferred to and merged with amounts made under
    this heading.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0313-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                                 485
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                                 485
    23.95 New obligations...................                                -485
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                                 485
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation
    73.10 New obligations...................                                 485
    73.20 Total outlays (gross).............                                 -57
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                                 429
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                                  57
    86.93 Outlays from current balances.....
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........                                  57
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                 485
    90.00 Outlays...........................                                  57
    ---------------------------------------------------------------------------

                          Proposed Transfer of Balances

                                  [In millions]

                                          1996 est.   1997 est.   1998 est.
    Indian Development (Annual
        Contributions):
      Budget Authority..................         163
      Outlays...........................         252         251         214
    Indian Development (Development of
        Additional New Subsidized
        Housing):
      Budget Authority..................                     200
      Outlays...........................                       0          10
    Modernization:
      Budget Authority..................         149         162
      Outlays...........................         161         162         181
    HOME:
      Budget Authority..................          14          21
      Outlays...........................          13          14          25
    Homeless:
      Budget Authority..................           1           1
      Outlays...........................           1           1           1
    Native American Block Grant:
      Budget Authority..................                                 485
      Outlays...........................                                  57
                                        ------------------------------------
          Total.........................
      Budget Authority..................         327         384         485
      Outlays...........................         427         428         488
                                        ====================================

        The 1998 budget proposes to transfer all obligated and unobligated
    balances from Annual Contributions, Development of Additional New
    Subsidized Housing, Preserving Existing Housing Investment, HOME
    Investment Partnerships Program Emergency Shelter Grants, and Homeless
    Assistance for Indian housing authorities and other agencies primarily
    serving Indians or Indian areas to the Native American Housing Block
    Grants Program.

        Title I of the Native American Housing Assistance and Self-
    Determination Act of 1996 (P.L. 104-330) authorized the Native American
    Housing Block Grants program. This program provides an allocation of
    funds on a formula basis to Indian tribes and their tribally designated
    housing entities to help them address housing needs within their
    communities. Indian tribes will use performance measures and benchmarks
    that are consistent with the national goals of the program, but can base
    these measures on the needs and priorities they establish in their own
    Indian housing plan.

    [[Page 536]]

    Public enterprise funds:

                Low-Rent Public Housing--Loans and Other Expenses

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4098-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Capital investment: Loans to
            public housing agencies and
            Indian housing authorities......          38          50          50
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              33.0).........................          38          50          50
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           6          13          13
    22.00 New budget authority (gross)......         107         115         118
    22.60 Redemption of debt................         -62         -65         -68
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          51          63          63
    23.95 New obligations...................         -38         -50         -50
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....          13          13          13
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    67.15 Authority to borrow (indefinite)..          20          50          50
    68.00 Spending authority from offsetting
            collections: Offsetting
            collections (cash)..............          87          65          68
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         107         115         118
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

            Obligated balance:
    72.40     Appropriation.................       1,288       1,176       1,064
    72.90     Fund balance..................
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............       1,288       1,176       1,064
    73.10 New obligations...................          38          50          50
    73.20 Total outlays (gross).............        -150        -162        -165
          Unpaid obligations, end of year:

            Obligated balance:
    74.40     Appropriation.................       1,176       1,064
    74.90     Fund balance..................                                 950
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................       1,176       1,064         950
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................          50          65          68
    86.98 Outlays from permanent balances...         100          97          97
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         150         162         165
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
    88.00     Federal sources...............         -62         -65         -68
    88.40     Non-Federal sources...........         -25
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........         -87         -65         -68
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          20          50          50
    90.00 Outlays...........................          64          97          97
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4098-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........       1,689       1,627       1,562
    1251  Repayments: Repayments and
            prepayments.....................         -62         -65         -65
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........       1,627       1,562       1,497
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4098-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........       4,132       3,861       3,507
    2251  Repayments and prepayments........        -271        -354        -280
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........       3,861       3,507       3,227
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..       3,861       3,507       3,227
    ---------------------------------------------------------------------------

        The Low-Rent Public Housing Loan Fund is used to provide direct
    Federal loans to fund remaining Public Housing Agency and Indian Housing
    Authority construction, acquisition, and modernization activities
    reserved under the Annual Contributions appropriation through 1986.
    These loans are made from borrowings from the Treasury. Under
    legislation enacted during 1986 (Public Law 99-272), the borrowings from
    the Treasury are forgiven at the end of each fiscal year and the loans
    to PHAs/IHAs are forgiven as construction, acquisition, and
    modernization activities are completed. Under the provisions of this
    legislation, $20 million of borrowings from the Treasury were forgiven
    in 1996, an estimated $50 million will be borrowed from the Treasury and
    forgiven in 1997, and an estimated $50 million will be borrowed from the
    Treasury and forgiven in 1998. The table below shows the status of
    outstanding loans for the period 1996-1998. The balance at the end of
    each year represents administrative loans, off-site facility loans, and
    preliminary loans on projects never undertaken and excess financing.

               PUBLIC HOUSING AGENCIES/INDIAN HOUSING AUTHORITIES

                                Loans Outstanding

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Outstanding, start of year..........          64          45          45
    Direct loan disbursements...........          38          50          50
    Repayments..........................         -20
    Adjustments.........................           2
    Total loans forgiven................         -39         -50         -50
                                        ------------------------------------
    Outstanding, end of year............          45          45          45
                                        ====================================

        Since 1987, new reservations of capital funds for construction,
    acquisition, and modernization activities have been provided directly
    from the Annual Contributions, Preserving Existing Housing Investment,
    and Development of Additional New Subsidized Housing appropriations.

        Operating results.--The actual and estimated net operating income
    for 1995, 1996, 1997, and 1998 follows:

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4098-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................         116            112           108            104
    0102  Expense...........................        -131           -127          -123           -119
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............         -15            -15           -15            -15
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4098-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....       1,294          1,189         1,084            979
            Investments in US securities:
    1106      Receivables, net..............       1,791          1,726         1,661          1,596
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............          64             45            45             45
    1602    Interest receivable.............           6              3             3              3
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................         -12            -12           -12            -12
    1604    Direct loans and interest
              receivable, net...............          58             36            36             36
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................          58             36            36             36
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       3,143          2,951         2,781          2,611

    [[Page 537]]

        LIABILITIES:
          Federal liabilities:

    2102    Interest payable................         205            198           191            184
    2104    Resources payable to Treasury...       1,688          1,627         1,565          1,503
    2207  Non-Federal liabilities: Other....           1              1             1              1
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       1,894          1,826         1,757          1,688
        NET POSITION:
    3100  Appropriated capital..............       1,184          1,076           968            860
    3300  Cumulative results of operations..          65             49            56             63
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............       1,249          1,125         1,024            923
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       3,143          2,951         2,781          2,611
    -----------------------------------------------------------------------------------------------

    Credit accounts:

               Indian Housing Loan Guarantee Fund Program Account

        For the cost of guaranteed loans, as authorized by section 184 of
    the Housing and Community Development Act of 1992 (106 Stat. 3739)
    $3,000,000, to remain available until expended: Provided, That such
    costs, including the costs of modifying such loans, shall be as defined
    in section 502 of the Congressional Budget Act of 1974, as amended:
    Provided further, That these funds are available to subsidize total loan
    principal, any part of which is to be guaranteed, not to exceed
    $36,900,000. (Departments of Veterans Affairs and Housing and Urban
    Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0223-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................           3           3           3
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......           3           3           3
    23.95 New obligations...................          -3          -3          -3
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................           3           3           3
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation           3           6           6
    73.10 New obligations...................           3           3           3
    73.20 Total outlays (gross).............                      -2          -3
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           6           6           6
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                       2           2
    86.93 Outlays from current balances.....                                   1
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........                       2           3
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................           3           3           3
    90.00 Outlays...........................                       2           3
    ---------------------------------------------------------------------------

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0223-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2150  Loan guarantee levels.............          37          37          37
                                               ---------   ---------  ----------
    2159    Total loan guarantee levels.....          37          37          37
        Guaranteed loan subsidy (in percent):
    2320  Subsidy rate......................        8.13        8.13        8.13
                                               ---------   ---------  ----------
    2329    Weighted average subsidy rate...        8.13        8.13        8.13
        Guaranteed loan subsidy budget authority:
    2330  Subsidy budget authority..........           3           3           3
                                               ---------   ---------  ----------
    2339    Total subsidy budget authority..           3           3           3
        Guaranteed loan subsidy outlays:
    2340  Subsidy outlays...................                       2           3
                                               ---------   ---------  ----------
    2349    Total subsidy outlays...........                       2           3
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for this program, the subsidy costs associated with the loan
    guarantees committed in 1994 and beyond (including modifications of
    guarantees that resulted from obligations in any year). The subsidy
    amounts are estimated on a net present value basis. The administrative
    expenses are shown on a cash basis.

        This program provides access to sources of private financing for
    Indian families, Indian tribes and their tribally designated housing
    entities (TDHEs) who otherwise could not acquire housing financing
    because of the unique legal status of Indian trust land.

              Indian Housing Loan Guarantee Fund Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4104-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....           3           3           5
    22.00 New financing authority (gross)...                       2           3
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......           3           5           8
    23.95 New obligations...................
    24.90 Unobligated balance available, end
            of year: Fund balance...........           3           5           8
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Spending
            authority from offsetting
            collections, Federal sources....                       2           3
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

    88.00   Offsetting collections (cash)
              from: Federal sources:
              Payments from program account.                      -2          -3
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............                       1           2
    90.00 Financing disbursements...........          -1                      -3
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4104-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........          37          37          37
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................          37          37          37
    2199  Guaranteed amount of guaranteed
            loan commitments................          37          37
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........           1           6          11
    2231  Disbursements of new guaranteed
            loans...........................           5           5          17
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........           6          11          28
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..           6          11
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this
    nonbudgetary account records all cash flows to and from the Government
    resulting from the loan guarantees committed in 1994 and beyond
    (including modifications of loan guarantees that resulted from
    obligations in any year). The amounts in this account are a means of
    financing and not included in the budget totals.

    [[Page 538]]

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4104-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....                          2             5
            Investments in US securities:
    1106      Receivables, net..............                          1             1
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................                          3             6
        LIABILITIES:
    2204  Non-Federal liabilities:
            Liabilities for loan guarantees.                          1             1
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............                          1             1
        NET POSITION:
    3100  Appropriated capital..............                          2             5
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............                          2             5
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position                          3             6
    -----------------------------------------------------------------------------------------------

                       COMMUNITY PLANNING AND DEVELOPMENT

                                  Federal Funds

    General and special funds:

                   Housing Opportunities for Persons with AIDS

        For carrying out the Housing Opportunities for Persons with AIDS
    program, as authorized by the AIDS Housing Opportunity Act (42 U.S.C.
    12901), [$171,000,000] $204,000,000, to remain available until
    expended[: Provided, That any amounts previously appropriated for such
    program, and any related assets and liabilities, in the ``Annual
    Contributions for Assisted Housing'' account, shall be transferred to
    and merged with amounts in this account]. (Departments of Veterans
    Affairs and Housing and Urban Development, and Independent Agencies
    Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0308-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                     237         204
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                     196         204
    22.22 Unobligated balance transferred
            from other accounts.............                      41
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......                     237         204
    23.95 New obligations...................                    -237        -204
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                     171         204
    42.00 Transferred from other accounts...                      25
                                               ---------   ---------  ----------
    43.00   Appropriation (total)...........                     196         204
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................                     196         204
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation                                 471
    73.10 New obligations...................                     237         204
    73.20 Total outlays (gross).............                    -133        -165
    73.32 Obligated balance transferred from
            other accounts..................                     367
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                     471         510
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                       4           4
    86.93 Outlays from current balances.....                     129         161
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........                     133         165
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                     196         204
    90.00 Outlays...........................                     133         165
    ---------------------------------------------------------------------------

        The Housing Opportunities for Persons with AIDS program was
    established as a separate account in 1997. All of the balances from
    prior appropriations for this program have been transferred to and
    merged with this account. This program is now accounted for on an
    obligation basis. The purpose of the program is to provide States and
    localities with resources and incentives to devise long-term
    comprehensive strategies for meeting the housing needs of persons with
    HIV/AIDS and their families.

        States and metropolitan areas receive 90 percent of the funds by
    formula based on the incidence of HIV/AIDS in their jurisdictions. The
    remaining 10 percent is awarded competitively to States, local
    governments, and private nonprofit entities for projects of national
    significance. Awards are also made to States and local governments for
    projects in jurisdictions which do not qualify for a formula allocation.

                    Community Development Block Grants [Fund]

                         (including transfers of funds)

        For grants to States and units of general local government and for
    related expenses, not otherwise provided for, to carry out a community
    development grants program as authorized by title I of the Housing and
    Community Development Act of 1974, as amended (the ``Act'' herein) (42
    U.S.C. 5301), $4,600,000,000, to remain available until September 30,
    [1999,] 2000; of which $67,000,000 shall be for grants to Indian tribes
    notwithstanding section 106(a)(1) of the Act[: Provided, That $2,100,000
    shall be available as a grant to the Housing Assistance Council,
    $1,500,000 shall be available as a grant to the National American Indian
    Housing Council, and $49,000,000]; of which [$35,000,000] $32,600,000
    shall be [available] for grants pursuant to section 107 of such Act[,
    including up to $14,000,000 for the development and operation of a
    management information system]; of which $50,000,000 shall be for
    Economic Development Grants; $50,000,000 shall be for activities to
    promote and implement homeownership in targeted geographic areas;
    $10,000,000 shall be for the Capacity Building for Community Development
    and Affordable Housing program; $10,000,000 shall be for a grant to
    Habitat for Humanity International; $10,000,000 shall be for grants to
    units of local government, preferably for communities designated as
    Empowerment Zones or Enterprise Communities, to develop strategies for
    Bridges to Work programs, which include assistance for job search,
    transportation, child care and other needed supportive services to
    increase job opportunities; and $60,000,000 shall be for the lead-based
    paint hazard reduction program: Provided further, That not to exceed 20
    percent of any grant made with funds appropriated herein (other than [a
    grant made available under the preceding proviso to the Housing
    Assistance Council or the National American Indian Housing Council, or]
    a grant using funds under section 107(b)(3) of the Housing and Community
    Development Act of 1974, as amended) shall be expended for ``Planning
    and Management Development'' and ``Administration'' as defined in
    regulations promulgated by the Department[: Provided further, That for
    fiscal year 1997 and thereafter, section 105(a)(25) of such Act, shall
    continue to be effective and the termination and conforming provisions
    of section 907(b)(2) of the Cranston-Gonzalez National Affordable
    Housing Act shall not be effective: Provided further, That section
    916(f) of the Cranston-Gonzalez National Affordable Housing Act is
    repealed].
        [Of the amount provided under this heading, the Secretary of Housing
    and Urban Development may use up to $60,000,000 for grants to public
    housing agencies (including Indian housing authorities), nonprofit
    corporations, and other appropriate entities for a supportive services
    program to assist residents of public and assisted housing, former
    residents of such housing receiving tenant-based assistance under
    section 8 of such Act (42 U.S.C. 1437f), and other low-income families
    and individuals to become self-sufficient: Provided, That the program
    shall provide supportive services, principally for the benefit of public
    housing residents, to the elderly and the disabled, and to families with
    children where the head of household would benefit from the receipt of
    supportive services and is working, seeking work, or is preparing for
    work by participating in job training or educational programs: Provided
    further, That the supportive serv-

    [[Page 539]]

    ices may include congregate services for the elderly and disabled,
    service coordinators, and coordinated educational, training, and other
    supportive services, including academic skills training, job search
    assistance, assistance related to retaining employment, vocational and
    entrepreneurship development and support programs, transportation, and
    child care: Provided further, That the Secretary shall require
    applications to demonstrate firm commitments of funding or services from
    other sources: Provided further, That the Secretary shall select public
    and Indian housing agencies to receive assistance under this head on a
    competitive basis, taking into account the quality of the proposed
    program (including any innovative approaches, the extent of the proposed
    coordination of supportive services, the extent of commitments of
    funding or services from other sources, the extent to which the proposed
    program includes reasonably achievable, quantifiable goals for measuring
    performance under the program over a three-year period, the extent of
    success an agency has had in carrying out other comparable initiatives,
    and other appropriate criteria established by the Secretary). Provided
    further, That from the foregoing $60,000,000, up to $5,000,000 shall be
    available for the Tenant Opportunity Program, and up to $5,000,000 shall
    be available for the Moving to Work Demonstration for public housing
    families.]
        [Of the amount made available under this heading, notwithstanding
    any other provision of law, $20,000,000 shall be available for grants to
    entities managing or operating public housing developments, federally-
    assisted multifamily-housing developments, or other multifamily-housing
    developments for low-income families supported by non-Federal
    governmental entities or similar housing developments supported by
    nonprofit private sources, to reimburse local law enforcement entities
    for additional police presence in and around such housing developments;
    to provide or augment such security services by other entities or
    employees of the recipient agency; to assist in the investigation and/or
    prosecution of drug related criminal activity in and around such
    developments; and to provide assistance for the development of capital
    improvements at such developments directly relating to the security of
    such developments: Provided, That such grants shall be made on a
    competitive basis as specified in section 102 of the HUD Reform Act.]
        [Of the amount made available under this heading, notwithstanding
    any other provision of law, $30,000,000 shall be available for
    youthbuild program activities authorized by subtitle D of title IV of
    the Cranston-Gonzalez National Affordable Housing Act, as amended, and
    such activities shall be an eligible activity with respect to any funds
    made available under this heading.]
        [Of the amount made available under this heading, notwithstanding
    any other provision of law, $60,000,000 shall be available for the lead-
    based paint hazard reduction program as authorized under sections 1011
    and 1053 of the Residential Lead-Based Hazard Reduction Act of 1992.]
        For the cost of guaranteed loans, [$31,750,000] $29,000,000, as
    authorized by section 108 of the Housing and Community Development Act
    of 1974: Provided, That such costs, including the cost of modifying such
    loans, shall be as defined in section 502 of the Congressional Budget
    Act of 1974, as amended: Provided further, That these funds are
    available to subsidize total loan principal, any part of which is to be
    guaranteed, not to exceed [$1,500,000,000], $1,261,000,000,
    notwithstanding any aggregate limitation on outstanding obligations
    guaranteed in section 108(k) of the Housing and Community Development
    Act [of 1974]. In addition, for administrative expenses to carry out the
    guaranteed loan program, [$675,000] $1,000,000, which shall be
    transferred to and merged with the appropriation for departmental
    salaries and expenses. (Departments of Veterans Affairs and Housing and
    Urban Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0162-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Grants............................       4,415       5,326       4,600
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................       4,415       5,326       4,600
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................         487         726
    22.00 New budget authority (gross)......       4,650       4,600       4,600
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           3
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       5,140       5,326       4,600
    23.95 New obligations...................      -4,415      -5,326      -4,600
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....         726
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................       4,650       4,600       4,600
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation       8,645       8,512       9,001
    73.10 New obligations...................       4,415       5,326       4,600
    73.20 Total outlays (gross).............      -4,545      -4,837      -4,641
    73.45 Adjustments in unexpired accounts.          -3
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation       8,512       9,001       8,960
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority         186          91          91
    86.93 Outlays from current balances.....       4,359       4,746       4,550
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........       4,545       4,837       4,641
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................       4,650       4,600       4,600
    90.00 Outlays...........................       4,545       4,837       4,641
    ---------------------------------------------------------------------------

        Title I of the Housing and Community Development Act of 1974, as
    amended, authorizes the Secretary to make grants to units of general
    local government and States to fund local community development
    programs.

        Funds are allocated to Indian tribes and, on an entitlement basis,
    to metropolitan cities and urban counties which receive their grants
    using the higher of two objective formulas. States and small cities are
    also allocated a portion of the available funds. Section 107 Grants
    include funding for Insular Areas, technical assistance, Historically
    Black Colleges and Universities, Community Development Work Study and
    Community Outreach Partnership programs.

        A revised and enhanced Economic Development Initiative (EDI) program
    which will build upon the success of the existing program, is proposed
    for 1998. The proposal will expand funding available for job creation
    projects, expand the list of eligible recipients, and provide more
    flexibility in meeting community and economic development needs. The
    focus of the 1998 EDI grants will be on the need to create employment
    opportunities in the wake of welfare reform.

        The Homeownership Zones program will provide flexible grants to
    States and Community Development Block Grant (CDBG) entitlement units of
    general local government for large-scale redevelopment of abandoned
    neighborhoods to create viable communities of mixed income homebuyers.

        The Capacity Building for Community Development and Affordable
    Housing program provides funding to the National Community Development
    Initiative (NCDI) to build the capacity of community-based development
    corporations and housing development organizations, and to assist such
    entities to carry out community development and affordable housing
    activities.

        Title X of the Housing and Community Development Act of 1992 (Public
    Law 102-550) authorizes a Lead-Based Paint Hazard Reduction program to
    address lead-hazard reduction activities in privately owned housing.

        Habitat for Humanity International would use this grant to undertake
    innovative homeownership opportunities through the provision of self-
    help housing, under which a homeowner would contribute a significant
    amount of sweat equity toward the construction of the new dwelling.
    These decent, safe and sanitary nonluxury dwellings must be made
    available to eligible homeowners at prices below prevailing market
    prices. Eligible activities include land acquisition (including
    financing and closing costs) and infrastructure improvement (installing,
    extending, constructing, rehabilitating or otherwise improving utilities
    and other infrastructure).

        The Bridges to Work program will provide assistance to low-income
    work-ready, but unemployed or underemployed,

    [[Page 540]]

    city residents in finding and maintaining employment. These grants will
    emphasize the link between transportation services and other supportive
    services to increase access to jobs throughout a metropolitan area. The
    funding will provide time-limited assistance for job search,
    transportation, child care and other needed supportive services to
    increase job opportunities. The program will build on the existing
    demonstration program by expanding collaborative efforts by private
    businesses, non-profit organizations and public agencies, including the
    Federal Government. The Bridges to Work program would be available on a
    competitive basis and would be targeted, but not limited to, Empowerment
    Zones and Enterprise Communities.

                  Empowerment Zones and Enterprise Communities

                  (Legislative proposal, not subject to PAYGO)

        For grants to Empowerment Zones and Enterprise Communities, to be
    designated by the Secretary of the Department of Housing and Urban
    Development, to continue efforts to stimulate economic opportunity in
    America's distressed communities, $100,000,000, to remain available
    until expended. (Additional authorizing legislation required.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0315-2-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                                 100
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                                 100
    23.95 New obligations...................                                -100
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                                 100
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................                                 100
    73.20 Total outlays (gross).............                                  -2
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                                  98
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                                   2
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                 100
    90.00 Outlays...........................                                   2
    ---------------------------------------------------------------------------

        This program would provide grants to support the financing of
    capital projects, including housing and economic development, in urban
    Empowerment Zones and Enterprise Communities. Applicants would be
    challenged to develop their own comprehensive strategic plans for
    revitalization, with the input of residents and a wide array of
    community partners. Grants could be used for a range of activities, at
    local discretion, including: workforce preparation and job creation
    efforts linked to welfare reform, repayment of debt financed by
    municipal bonds; financing of projects in conjunction with the section
    108 financing loan guarantee program and other economic development
    projects; and support for project-based rental assistance and other
    housing initiatives.

                            Brownfields Redevelopment

        For Economic Development Grants, as authorized by section 108 of the
    Housing and Community Development Act of 1974, as amended, for
    Brownfields redevelopment projects, $25,000,000, to remain available
    until expended.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0314-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                                  25
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                                  25
    23.95 New obligations...................                                 -25
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                                  25
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................                                  25
    73.20 Total outlays (gross).............                                  -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                                  24
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority                                   1
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                  25
    90.00 Outlays...........................                                   1
    ---------------------------------------------------------------------------

        This program would make competitive economic development grants in
    conjunction with Section 108 loan guarantees for qualified brownfield
    projects. This is the first of four annual funding requests, for a total
    of $100 million, to be dedicated to the initiative between 1998 and
    2001. This program will solicit applications from communities with the
    best proposals for returning these sites to productive, and employment
    generating uses, with an emphasis on creating substantial numbers of
    jobs for lower income people in physically and economically distressed
    neighborhoods.

        Grants would be made in accordance with section 108(q) selection
    criteria and such other criteria deemed appropriate for brownfield
    projects, including the extent to which an applicant is currrently
    operating a brownfields program and is working with appropriate
    environmental regulatory agencies. Priority would be given to those
    projects that are located in designated Empowerment Zones or Enterprise
    Communities.

                      HOME Investment Partnerships Program

        For the HOME investment partnerships program, as authorized under
    title II of the Cranston-Gonzalez National Affordable Housing Act
    (Public Law 101-625), as amended, [$1,400,000,000] $1,309,000,000, to
    remain available until expended: Provided, [$21,000,000 shall be
    available for grants to Indian tribes: Provided further,] That up to
    [0.5 percent, but not less than] $7,000,000 shall be available for the
    development and operation of integrated community development management
    information systems[; Provided further, That $15,000,000 shall be
    available for Housing Counseling under section 106 of the Housing and
    Urban Development Act of 1968]. (Departments of Veterans Affairs and
    Housing and Urban Development, and Independent Agencies Appropriations
    Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0205-0-1-999      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................       1,367       1,582       1,309
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................         148         182
    22.00 New budget authority (gross)......       1,400       1,400       1,309
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       1,549       1,582       1,309
    23.95 New obligations...................      -1,367      -1,582      -1,309

    [[Page 541]]

    24.40 Unobligated balance available, end
            of year: Uninvested balance.....         182
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................       1,400       1,400       1,309
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation       3,189       3,349       3,486
    73.10 New obligations...................       1,367       1,582       1,309
    73.20 Total outlays (gross).............      -1,206      -1,445      -1,440
    73.45 Adjustments in unexpired accounts.          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation       3,349       3,486       3,355
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority          28          28          26
    86.93 Outlays from current balances.....       1,178       1,417       1,414
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........       1,206       1,445       1,440
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................       1,400       1,400       1,309
    90.00 Outlays...........................       1,206       1,445       1,440
    ---------------------------------------------------------------------------

        The HOME Investment Partnership program is authorized by the
    National Affordable Housing Act (P.L. 101-625). This program provides
    assistance to States and units of local government, through formula
    allocation, for the purpose of expanding the supply and affordability of
    housing. Eligible activities include acquisition, rehabilitation, and
    new construction of housing and tenant-based rental assistance.

        The 1998 proposal includes funds to continue to develop, implement
    and refine integrated community development management information
    systems which are critical to establishing a national database of local
    needs and program performance, as well as to provide localities, States
    and community members with software to plan and track performance.
    Funding for technical assistance is also included.

                         Urban Development Action Grants

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0170-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         163         136          76
    73.20 Total outlays (gross).............         -27         -60         -45
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         136          76          31
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          27          60          45
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................          27          60          45
    ---------------------------------------------------------------------------

        Title I of the Housing and Community Development Act of 1974, as
    amended, authorized grants to distressed cities and distressed urban
    counties to fund economic development projects. The program was
    terminated in 1990.

       Capacity Building for Community Development and Affordable Housing

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0222-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          19          13           3
    73.20 Total outlays (gross).............          -5         -10          -3
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          13           3
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....           5          10           3
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................           5          10           3
    ---------------------------------------------------------------------------

        As authorized by section 4 of the HUD Demonstration Act of 1993,
    this program provides funding to the National Community Development
    Initiative to build the capacity of community-based development
    corporations and housing development organizations, and to assist such
    corporations and organizations to carry out community development and
    affordable housing activities. Funding for this program was provided
    under the Annual Contributions for Assisted Housing account in 1996, and
    is requested under the Community Development Block Grant account in
    1998.

                        Emergency Shelter Grants Program

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0181-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          36           6
    73.20 Total outlays (gross).............         -30          -6
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           6
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          30           6
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................          30           6
    ---------------------------------------------------------------------------

        Title IV, subtitle B, of the Stewart B. McKinney Homeless Assistance
    Act (Public Law 100-77), authorizes the Secretary to make Emergency
    Shelter Grants to States, units of local government, and nonprofit
    organizations to provide emergency shelter and other support for the
    homeless. Since fiscal year 1995, this assistance has been funded under
    the Homeless Assistance Grants account.

                           Supportive Housing Program

        Of the funds made available under this heading in Public Law 102-389
    and prior laws for the Supportive Housing Demonstration Program, as
    authorized by the Stewart B. McKinney Homeless Assistance Act,
    $6,000,000 of funds recaptured during fiscal year 1998 shall be
    rescinded.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0188-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................          44          31
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................          66          31
    22.00 New budget authority (gross)......                                  -6
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           9                       6
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          75          31
    23.95 New obligations...................         -44         -31
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....          31
    ----------------------------------------------------------------------------

    [[Page 542]]

        New budget authority (gross), detail:
    40.36 Unobligated balance rescinded.....                                  -6
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         575         462         336
    73.10 New obligations...................          44          31
    73.20 Total outlays (gross).............        -148        -157        -144
    73.45 Adjustments in unexpired accounts.          -9                      -6
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         462         336         186
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....         148         157         144
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                  -6
    90.00 Outlays...........................         148         157         144
    ---------------------------------------------------------------------------

        Title IV, subtitle C, of the Stewart B. McKinney Homeless Assistance
    Act authorizes assistance to promote the development of supportive
    housing and services, especially for deinstitutionalized homeless
    individuals, homeless families with children, homeless individuals with
    mental disabilities, and other persons including those with AIDS. Such
    assistance is available for the acquisition, rehabilitation,
    construction, or leasing of structures to be used for homeless persons
    as well as to pay for operating costs and supportive services.

        Since fiscal year 1995, this type of assistance has been funded
    under the Homeless Assistance Grants account.

        This proposal would rescind funding, recaptured in 1998, for
    approved projects in prior years which were either not undertaken or
    utilized less funding than originally obligated.

          Supplemental Assistance for Facilities To Assist the Homeless

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0187-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................                       1           1
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......           1           1           1
    23.95 New obligations...................
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....           1           1           1
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation           9           3
    73.10 New obligations...................
    73.20 Total outlays (gross).............          -5          -3
    73.45 Adjustments in unexpired accounts.          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           3
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....           5           3
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................           5           3
    ---------------------------------------------------------------------------

        Title IV, subtitle D, of the Stewart B. McKinney Homeless Assistance
    Act, authorized the Supplemental Assistance for Facilities To Assist the
    Homeless program (SAFAH) to provide comprehensive assistance for
    particularly innovative programs or alternative methods of meeting the
    immediate and long-term needs of the homeless. The authority for the
    SAFAH program was terminated by section 1403 of the Housing and
    Community Development Act of 1992.

                                Shelter Plus Care

        Of the funds made available under this heading in Public Law 102-389
    and prior laws for the Shelter Plus Care program, as authorized by the
    Stewart B. McKinney Homeless Assistance Act, $4,000,000 of funds
    recaptured during fiscal year 1998 shall be rescinded.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0204-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................           9          16
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................          24          16
    22.00 New budget authority (gross)......                                  -4
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1                       4
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          25          16
    23.95 New obligations...................          -9         -16
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....          16
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.36 Unobligated balance rescinded.....                                  -4
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         454         419         385
    73.10 New obligations...................           9          16
    73.20 Total outlays (gross).............         -43         -50         -49
    73.45 Adjustments in unexpired accounts.          -1                      -4
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         419         385         332
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority
    86.93 Outlays from current balances.....          43          50          49
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........          43          50          49
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                  -4
    90.00 Outlays...........................          43          50          49
    ---------------------------------------------------------------------------

        Title IV, subtitle F, of the Stewart B. McKinney Homeless Assistance
    Act, authorizes the Secretary to provide rental assistance to persons
    with disabilities. Supportive services at least equal in value to the
    aggregate rental assistance must also be provided by grant recipients,
    using other Federal, State, local and private resources. Eligible
    recipients include States, units of general local government and Indian
    tribes.

        Since fiscal year 1995, this type of assistance has been funded
    under the Homeless Assistance Grants account.

        This proposal would rescind funding, recaptured in 1998, for
    approved projects in prior years which were either not undertaken or
    utilized less funding than was originally obligated.

              Innovative Homeless Initiatives Demonstration Program

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0221-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          79          58          39
    73.20 Total outlays (gross).............         -20         -19         -17

    [[Page 543]]

    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          58          39          22
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          20          19          17
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................          20          19          17
    ---------------------------------------------------------------------------

        Section 2 of the HUD Demonstration Act of 1993 authorized assistance
    for projects intended to provide a continuum of care for homeless
    persons and for innovative programs to assist homeless persons. Eligible
    recipients included States, units of local government, Indian tribes,
    and nonprofit organizations. Authorization for this program expired at
    the end of fiscal year 1994.

                       Homeless Assistance [Funds] Grants

        For grants to States, units of general local government, nonprofit
    organizations, or public housing authorities, and for related expenses
    not otherwise provided for, necessary for carrying out a performance-
    based homeless assistance program, $823,000,000, to remain available
    until expended: Provided, That up to one percent of such funds shall be
    available to the Secretary for technical assistance. (Additional
    authorizing legislation required.)
        [For the emergency shelter grants program (as authorized under
    subtitle B of title IV of the Stewart B. McKinney Homeless Assistance
    Act (Public Law 100-77), as amended); the supportive housing program (as
    authorized under subtitle C of title IV of such Act); the section 8
    moderate rehabilitation single room occupancy program (as authorized
    under the United States Housing Act of 1937, as amended) to assist
    homeless individuals pursuant to section 441 of the Stewart B. McKinney
    Homeless Assistance Act; and the shelter plus care program (as
    authorized under subtitle F of title IV of such Act), $823,000,000, to
    remain available until expended.] (Departments of Veterans Affairs and
    Housing and Urban Development, and Independent Agencies Appropriations
    Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0192-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................         785       1,711         823
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................         849         888
    22.00 New budget authority (gross)......         823         823         823
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       1,673       1,711         823
    23.95 New obligations...................        -785      -1,711        -823
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....         888
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................         823         823         823
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         260         857       2,283
    73.10 New obligations...................         785       1,711         823
    73.20 Total outlays (gross).............        -186        -285        -474
    73.45 Adjustments in unexpired accounts.          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         857       2,283       2,632
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority          41          41          41
    86.93 Outlays from current balances.....         145         244         433
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         186         285         474
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         823         823         823
    90.00 Outlays...........................         186         285         474
    ---------------------------------------------------------------------------

        The Homeless Assistance Grants program consolidates the activities
    of HUD's six McKinney homeless assistance programs--Shelter Plus Care,
    Supportive Housing, Emergency Shelter Grants, Section 8 Single Room
    Occupancy, Rural Homeless Grants and Safe Havens--as well as those of
    the Innovative Homeless Initiatives Demonstration program. This
    consolidation would enable localities to continue to shape and implement
    comprehensive, flexible, coordinated ``continuum of care'' approaches to
    solving rather than institutionalizing homelessness. In fact, over the
    last three years, many communities have made great strides in developing
    holistic continuum of care approaches to solving homelessness. A
    community-based process would be required as part of the application
    process. Communities will be required to include in their applications
    performance measures that contain specific goals that would accrue from
    the community's efforts, and will be required to demonstrate tangible
    results on an annual basis. Approved funding would be available for a
    wide range of activities to assist homeless persons and prevent future
    homelessness.

        Funding is also requested for technical assistance to provide needed
    assistance to grantees in resolving problems that hinder successful
    project completion and implementation.

                               Youthbuild Program

        For the HOPE for Youth: Youthbuild program, authorized by subtitle D
    of title IV of the Cranston-Gonzalez National Affordable Housing Act, as
    amended, $30,000,000, to remain available until expended.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0219-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                       3          30
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           2           3
    22.00 New budget authority (gross)......                                  30
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......           3           3          30
    23.95 New obligations...................                      -3         -30
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....           3
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                                  30
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          85          43          21
    73.10 New obligations...................                       3          30
    73.20 Total outlays (gross).............         -41         -25         -15
    73.45 Adjustments in unexpired accounts.          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          43          21          36
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          41          25          15
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                  30
    90.00 Outlays...........................          41          25          15
    ---------------------------------------------------------------------------

        This program provides resources to educate, train, and provide
    stipends for economically disadvantaged young adults to construct and
    rehabilitate housing for low-income and homeless persons. The program
    has expanded the supply of affordable housing and, at the same time, has
    enabled high school dropouts to obtain the education and employment
    skills necessary to achieve self-sufficiency.

    [[Page 544]]

        For fiscal years 1996 and 1997, funding for the Youthbuild program
    was included in the Community Development Block Grants account.

            National Cities in Schools Community Development Program

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0220-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation           2
    73.20 Total outlays (gross).............          -2
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....           2
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................           2
    ---------------------------------------------------------------------------

        This program provides grants for community-wide programs designed to
    assist at-risk youth and their families. Funding for this program was
    provided under the Annual Contributions for Assisted Housing account in
    fiscal year 1996.

    Public enterprise funds:

                      Revolving Fund (Liquidating Programs)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4015-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.03 Loan servicing and other expenses.           8           7           7
    00.04 Maintenance of acquired security
            and collateral..................                       7           6
    00.05 Administrative expenses...........           1           1           1
                                               ---------   ---------  ----------
    10.00   Total obligations...............           9          15          14
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....         102          97          87
    22.00 New budget authority (gross)......          74          65          60
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
    22.40 Capital transfer to general fund..         -70         -60         -60
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         107         102          87
    23.95 New obligations...................          -9         -15         -14
    24.90 Unobligated balance available, end
            of year: Fund balance...........          97          87          73
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............          74          65          60
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Fund balance.          46          27           7
    73.10 New obligations...................           9          15          14
    73.20 Total outlays (gross).............         -28         -35         -21
    73.45 Adjustments in unexpired accounts.          -1
    74.90 Unpaid obligations, end of year:
            Obligated balance: Fund balance.          27           7
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.98 Outlays from permanent balances...          28          35          21
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.40   Offsetting collections (cash)
              from: Non-Federal sources.....         -74         -65         -60
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................         -46         -30         -39
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4015-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........         388         328         282
    1251  Repayments: Repayments and
            prepayments.....................         -51         -45         -40
    1263  Write-offs for default: Direct
            loans...........................          -9          -1
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........         328         282         242
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4015-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........           4           3           2
    2251  Repayments and prepayments........          -1          -1          -1
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........           3           2           1
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..           3           2           1
    ---------------------------------------------------------------------------

        The Revolving fund (liquidating programs) was established by the
    Independent Offices Appropriation Act of 1955 for the efficient
    liquidation of assets acquired under a number of housing and urban
    development programs.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4015-0-3-451    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................          19             31            20             20
    0102  Expense...........................         -12            -18           -15            -12
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............           7             13             5              8
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4015-0-3-451    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................         149            125           135            130
    1206  Non-Federal assets: Receivables,
            net.............................           3              4             3              2
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............         391            331           301            254
    1602    Interest receivable.............          21             18            20             18
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................         -36            -25           -39            -30
    1604    Direct loans and interest
              receivable, net...............         376            324           282            242
    1606    Foreclosed property.............           1              1             1
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................         377            325           283            242
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................         529            454           421            374
        LIABILITIES:
          Non-Federal liabilities:

    2201    Accounts payable................           1
    2207    Other...........................          13              9             8              7
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............          14              9             8              7
        NET POSITION:
    3100  Appropriated capital..............                         28            28             28
    3200  Invested capital..................                        301           301            301
    3300  Cumulative results of operations..         514            116            84             38
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............         514            445           413            367
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position         528            454           421            374
    -----------------------------------------------------------------------------------------------

    [[Page 545]]

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4015-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................           5          10          10
    32.0  Land and structures...............           4           5           4
                                               ---------   ---------  ----------
    99.9    Total obligations...............           9          15          14
    ---------------------------------------------------------------------------

    Credit accounts:

              Community Development Loan Guarantees Program Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0198-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.02 Guaranteed loan subsidy...........           9          32          29
    00.09 Administrative expenses...........           1           1           1
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              33.0).........................          10          33          30
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......          33          33          30
    22.30 Unobligated balance expiring......         -23
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          10          33          30
    23.95 New obligations...................         -10         -33         -30
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................          33          33          30
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation                       9          19
    73.10 New obligations...................          10          33          30
    73.20 Total outlays (gross).............          -1         -23         -35
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           9          19          14
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority           1          17          16
    86.93 Outlays from current balances.....                       6          19
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........           1          23          35
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          33          33          30
    90.00 Outlays...........................           1          23          35
    ---------------------------------------------------------------------------

        Guaranteed Loans.--The Community Development Block Grant program
    includes a guaranteed loan provision (Section 108). A commitment level
    of $1.3 billion is proposed for the Community Development Loan
    Guarantees (Section 108) program for 1998. The credit subsidy/
    administrative cost estimate for the guaranteed loan program is $30
    million in FY 1998.

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0198-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2150  Loan guarantee levels.............       1,500       1,380       1,261
                                               ---------   ---------  ----------
    2159    Total loan guarantee levels.....       1,500       1,380       1,261
        Guaranteed loan subsidy (in percent):
    2320  Subsidy rate......................        2.10        2.30        2.30
                                               ---------   ---------  ----------
    2329    Weighted average subsidy rate...        2.10        2.30        2.30
        Guaranteed loan subsidy budget authority:
    2330  Subsidy budget authority..........          32          32          29
                                               ---------   ---------  ----------
    2339    Total subsidy budget authority..          32          32          29
        Guaranteed loan subsidy outlays:
    2340  Subsidy outlays...................                      22          23
                                               ---------   ---------  ----------
    2349    Total subsidy outlays...........                      22          23
    ----------------------------------------------------------------------------

        Administrative expense data:
    3510  Budget authority..................           1           1           1
    3590  Outlays...........................           1           1           1
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for this program, the subsidy costs associated with the loan
    guarantees committed in 1992 and beyond (including modifications of
    direct loans or loan guarantees that resulted from obligations or
    commitments in any year), as well as administrative expenses of this
    program. The subsidy amounts are estimated on a present value basis; the
    administrative expenses are estimated on a cash basis.

             Community Development Loan Guarantees Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4096-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....                                  23
    22.00 New financing authority (gross)...                      23          37
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......                      23          60
    24.90 Unobligated balance available, end
            of year: Fund balance...........                      23          60
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............                      23          37
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
    88.00     Federal sources...............                     -22         -34
    88.25     Interest on uninvested funds..                      -1          -3
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........                     -23         -37
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............
    90.00 Financing disbursements...........                     -23         -37
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4096-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........       1,500       1,380       1,261
    2112  Uncommitted loan guarantee
            limitation......................      -1,066
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................         434       1,380       1,261
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........         430         750       1,425
    2231  Disbursements of new guaranteed
            loans...........................         360         750       1,150
    2251  Repayments and prepayments........         -40         -75        -135
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........         750       1,425       2,440
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..         750       1,425       2,440
    ---------------------------------------------------------------------------

        Guaranteed loans.--The Community Development Loan Guarantees program
    provides a mechanism for Federal guarantees of private loans. There is
    an accompanying liquidating account which shows activity for Federal
    Financing Bank (FFB) direct loan activity, obligated prior to July 1,
    1986. Also following is a status of privately financed guaranteed loan
    commitments made prior to 1992.

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from loan guarantees committed in 1992 and beyond (including
    modifications of loan guaran-

    [[Page 546]]

    tees that resulted from commitments in any year). The amounts in this
    account are a means of financing and are not included in the budget
    totals.

            Community Development Loan Guarantees Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4097-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......          50           4           4
    22.60 Redemption of debt................         -50          -4          -4
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............          50           4           4
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.47 Unpaid obligations, start of year:
            Obligated balance: Authority to
            borrow..........................         153         147         147
    73.20 Total outlays (gross).............          -6
    74.47 Unpaid obligations, end of year:
            Obligated balance: Authority to
            borrow..........................         147         147         147
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.98 Outlays from permanent balances...           6
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.40   Offsetting collections (cash)
              from: Non-Federal sources.....         -50          -4          -4
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................         -44          -4          -4
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4097-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........          89          39          35
    1251  Repayments: Repayments and
            prepayments.....................         -50          -4          -4
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........          39          35          31
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4097-0-3-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........         246         243         203
    2231  Disbursements of new guaranteed
            loans...........................          44          15          10
    2251  Repayments and prepayments........         -47         -55         -33
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........         243         203         180
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..         243         203         180
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records all cash flows to and from the Government resulting from Federal
    Financing Bank (FFB) direct loans for which loan guarantees were
    committed prior to 1992. This account is shown on a cash basis.

        Guaranteed loans.--Guaranteed loan assistance under the Community
    Development Loan Guarantees program is provided to eligible communities
    to finance economic development activities, housing rehabilitation,
    public facilities, acquisition of real property, rehabilitation of
    publicly owned real property, and certain related expenses. In the past,
    the FFB financed these guaranteed loans. The Consolidated Omnibus Budget
    Reconciliation Act of 1985 requires private financing of all loan
    guarantees committed after July 1, 1986. FFB will continue disbursing
    loans for commitments approved prior to July 1, 1986. The activity shown
    in the above account reflects privately financed guaranteed loans for
    which commitments were made prior to 1992.

                                HOUSING PROGRAMS

                                  Federal Funds

    General and special funds:

     [Development of Additional New Subsidized Housing] Housing for Special
                                   Populations

        For assistance for the purchase, construction, acquisition, or
    development of additional public and subsidized housing units for low
    income families under the United States Housing Act of 1937, as amended,
    [(``the Act'' herein)] (42 U.S.C. 1437), not otherwise provided for,
    [$1,039,000,000] $474,000,000, to remain available until expended:
    Provided, That of the total amount provided under this head,
    [$645,000,000] $300,000,000 shall be for capital advances, including
    amendments to capital advance contracts, for housing for the elderly, as
    authorized by section 202 of the Housing Act of 1959, as amended, and
    for project rental assistance, and amendments to contracts for project
    rental assistance, for supportive housing for the elderly under section
    202(c)(2) of the Housing Act of 1959; and [$194,000,000] $174,000,000
    shall be for capital advances, including amendments to capital advance
    contracts, for supportive housing for persons with disabilities, as
    authorized by section 811 of the Cranston-Gonzalez National Affordable
    Housing Act, and for project rental assistance, and amendments to
    contracts for project rental assistance, for supportive housing for
    persons with disabilities as authorized by section 811 of [the Cranston-
    Gonzalez National Affordable Housing] such Act: Provided further, That
    the Secretary may designate up to 25 percent of the amounts earmarked
    under this paragraph for section 811 of [the Cranston-Gonzalez National
    Affordable Housing] such Act for tenant-based assistance, as authorized
    under that section, including such authority as may be waived under the
    next proviso, which assistance is five years in duration: Provided
    further, That the Secretary may waive any provision of section 202 of
    the Housing Act of 1959 and section 811 of the National Affordable
    Housing Act (including the provisions governing the terms and conditions
    of project rental assistance and tenant-based assistance) that the
    Secretary determines is not necessary to achieve the objectives of these
    programs, or that otherwise impedes the ability to develop, operate or
    administer projects assisted under these programs, and may make
    provision for alternative conditions or terms where appropriate:
    Provided further, That [of the total amount provided under this head
    $200,000,000, shall be for the development or acquisition cost of public
    housing for Indian families, including amounts for housing under the
    mutual help homeownership opportunity program under section 202 of the
    Act (42 U.S.C. 1437bb)] all obligated and unobligated balances remaining
    in either the Annual Contributions for Assisted Housing account or the
    Development of Additional New Subsidized Housing account for capital
    advances, including amendments to capital advances, for housing for the
    elderly, as authorized by section 202 of the Housing Act of 1959, as
    amended, and for project rental assistance, and amendments to contracts
    for project rental assistance, for supportive housing for the elderly,
    under section 202(c)(2) of such Act, shall be transferred to and merged
    with the amounts for those purposes under this head; and, all obligated
    and unobligated balances remaining in either the Annual Contributions
    for Assisted Housing account or the Development of Additional New
    Subsidized Housing account for capital advances, including amendments to
    capital advances, for supportive housing for persons with disabilities,
    as authorized by section 811 of the Cranston-Gonzales National
    Affordable Housing Act, and for project rental assistance, and
    amendments to contracts for project rental assistance, for supportive
    housing for persons with disabilities, as authorized under section 811
    of such Act, shall be transferred to and merged with the amounts for
    those purposes under this head. (Departments of Veterans Affairs and
    Housing and Urban Development, and Independent Agencies Appropriations
    Act, 1997.)

    [[Page 547]]

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0310-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                   1,039         474
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                   1,039         474
    23.95 New obligations...................                  -1,039        -474
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                   1,039         474
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation                               1,039
    73.10 New obligations...................                   1,039         474
    73.20 Total outlays (gross).............                                 -15
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation                   1,039       1,498
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....                                  15
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                   1,039         474
    90.00 Outlays...........................                                  15
    ---------------------------------------------------------------------------

        This account consolidates the new activity under the Section 202
    Housing for the Elderly Program and the Section 811 Housing for the
    Disabled Program. Program activity prior to 1997 is reflected in the
    Annual Contributions for Assisted Housing account. Renewal of prior year
    contracts is reflected in the Prevention of Resident Displacement
    account.

        A program level of $300 million for Housing for the Elderly grants
    and rental assistance is proposed for 1998. This is estimated to support
    the production of 3,865 additional units.

        A program level of $174 million is proposed for disabled housing,
    including $43.5 million for 1,630 5-year vouchers and $130.5 million for
    grant and rental assistance to support 1,488 additional units.

        During fiscal year 1996 funding for supportive housing for the
    elderly and disabled was provided under the Annual Contributions for
    Assisted Housing account. For 1997, funding was provided under the
    Development of Additional New Subsidized Housing, and in 1998 funding is
    proposed under the new Housing for Special Populations account. The
    table below shows the total budget authority and outlays associated with
    all three accounts. Language is being proposed in this budget to
    transfer the balances from Annual Contributions and Development of
    Additional New Housing accounts to the Housing for Special Populations
    account.

                          Proposed Transfer of Balances

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Annual Contributions for Assisted
        Housing:
      Budget Authority..................       1,013          NA          NA
      Outlays...........................         757         853         911
    Development of Additional New
        Subsidized Housing:
      Budget Authority..................          NA         839          NA
      Outlays...........................          NA          NA          NA
    Housing for Special Populations:
      Budget Authority..................          NA          NA         474
      Outlays...........................          NA          NA          NA
                                        ------------------------------------
    Total:
      Budget Authority..................       1,013         839         474
      Outlays...........................         757         853         911
                                        ====================================

                         Other Assisted Housing Programs

                            Rental Housing Assistance

                                  (Rescissions)

        The limitation otherwise applicable to the maximum payments that may
    be required in any fiscal year by all contracts entered into under
    section 236 of the National Housing Act (12 U.S.C. 1715z-1) is reduced
    in fiscal year 1998 by not more than $7,350,000 in uncommitted balances
    of authorizations provided for this purpose in appropriation Acts:
    Provided, That up to $125,000,000 of recaptured budget authority shall
    be canceled.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0206-0-1-999      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Rent supplement...................           9          39          37
    00.02 Homeownership and rental housing
            assistance (Sections 235 and
            236)............................          16          68          64
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................          25         107         101
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

    21.40   Uninvested balance..............          12          15
    21.49   Contract authority (available)..       1,032         978         959
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............       1,044         993         959
    22.00 New budget authority (gross)......                                -125
    22.10 Resources available from
            recoveries of prior year
            obligations.....................         340         111         278
    22.75 Balance of contract authority
            withdrawn.......................        -365         -38         -33
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       1,019       1,066       1,079
    23.95 New obligations...................         -25        -107        -101
          Unobligated balance available, end of year:

    24.40   Uninvested balance..............          15
    24.49   Contract authority (available)..         978         959         978
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................         993         959         978
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.36   Unobligated balance canceled....                                -125
          Permanent:

    60.05   Appropriation (indefinite)......         709         727         678
    60.49   Portion applied to liquidate
              contract authority............        -709        -727        -678
                                               ---------   ---------  ----------
    63.00     Appropriation (total).........
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................                                -125
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

            Obligated balance:
    72.40     Administrative commitment
                (reserved)..................         104         140         140
    72.49     Contract authority............      22,774      21,687      20,956
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............      22,878      21,827      21,096
    73.10 New obligations...................          25         107         101
    73.20 Total outlays (gross).............        -736        -727        -678
    73.45 Adjustments in unexpired accounts.        -340        -111        -278
          Unpaid obligations, end of year:

            Obligated balance:
    74.40     Administrative commitment
                reserved....................         140         140         140
    74.49     Contract authority............      21,687      20,956      20,101
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................      21,827      21,096      20,241
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....         736         727         678
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                -125
    90.00 Outlays...........................         736         727         678
    ---------------------------------------------------------------------------

                Status of Contract Authority (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0206-0-1-999      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    0100  Balance, start of year............       1,032         978         959
    0100  Balance, start of year............      22,774      21,687      20,956
        Contract authority:
    0200  Contract authority................                                -125

    [[Page 548]]

    0400  Appropriation to liquidate
            contract authority..............        -709        -727        -678
    0600  Balance of contract authority
            withdrawn.......................        -365         -38         -33
        Balance, end of year:
    0700  Balance, end of year..............         978         959         978
    0700  Balance, end of year..............      21,687      20,956      20,101
    ---------------------------------------------------------------------------

                             OTHER ASSISTED HOUSING

                      Summary of Administrative Commitments

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Program by activities...............
      Assistance contracts:
        Rent supplement.................           9          39          37
        Homeownership and rental housing
          assistance (sections 235 and
          236)..........................          16          68          64
      Administrative commitments, start
        of year.........................          16          16          16
      Administrative commitments, end of
        year............................         -16         -16         -16
                                        ------------------------------------
          Total obligations.............          25         107         101
                                        ====================================

        The Other Assisted Housing Account contains the programs listed
    below:

        Rent supplement.--Rent supplement assistance payments will continue
    to be made on behalf of qualified low-income tenants in approximately
    20,000 units which have not converted to section 8.

        Section 235.--The Housing and Urban-Rural Recovery Act of 1983
    (Public Law 98-181) authorized a restructured section 235 (Homeownership
    Assistance) program based on a 10-year interest reduction subsidy. A
    total of $150 million of budget authority was provided in the Second
    Supplemental Appropriations Act of 1984 (Public Law 98-396) to fund the
    program. Recaptures of budget authority from terminations must be
    transferred into the Homeownership Assistance Fund account established
    pursuant to Public Law 98-181.

        Section 236.--The Housing and Urban Development Act of 1968, as
    amended, authorizes the section 236 Rental Housing Assistance Program
    which subsidizes the monthly mortgage payment that an owner of a rental
    or cooperative project is required to make. This interest subsidy
    reduces rents for lower income tenants. During 1998, as a result of
    foreclosures from mortgage defaults or regulatory violations, the
    Department will rescind up to $125 million.

        During 1998, as a result of foreclosures from mortgage defaults or
    regulatory violations, the Department will rescind up to $125 million.

        The table below reflects the consolidated outlay total for both the
    Annual Contributions for Assisted Housing account and the Other Assisted
    Housing account, for fiscal years 1996, 1997, and 1998.

                               SUMMARY OF OUTLAYS

                            [In millions of dollars]

     (Annual Contributions for Assisted Housing, Housing Certificate Fund,
                         and Other Assisted Housing) \1\

                                         1996 actual  1997 est.   1998 est.
    Subsidized housing programs, total..      21,064      22,308      22,494
    Low-income housing assistance (sec.
    8)..................................      15,779      17,283      17,937
    Public housing......................       4,548       4,296       3,867
    Rent supplement.....................          57          58          60
    Homeownership assistance (sec. 235).                      31          31
    Rental housing assistance (sec. 236)         663         623         582
    College housing grants..............          17          17          17
        \1\ Includes outlays for contract renewals.

    Homeownership and Opportunity for People Everywhere Grants (HOPE Grants)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0196-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Hope I............................                       3
    00.02 Hope II...........................                      31
    00.03 Hope III..........................           3           2
    00.04 Elderly independence..............           1           2
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................           4          38
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

            Uninvested balance:
    21.40     Uncommitted...................          36          34
    21.40     Administratively committed....           5           4
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............          41          38
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          42          38
    23.95 New obligations...................          -4         -38
          Unobligated balance available, end of year:

            Uninvested balance:
    24.40     Uncommitted...................          34
    24.40     Administratively committed....           4
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................          38
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         244         184         136
    73.10 New obligations...................           4          38
    73.20 Total outlays (gross).............         -63         -86         -59
    73.45 Adjustments in unexpired accounts.          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         184         136          77
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          63          86          59
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................          63          86          59
    ---------------------------------------------------------------------------

                     Summary of Budget Authority and Outlays

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Enacted/requested:
      Budget Authority..................
      Outlays...........................          63          86          59
    Supplemental proposal:
      Budget Authority..................                     -30
      Outlays...........................                      -6          -8
                                        ------------------------------------
    Total:
      Budget Authority..................                     -30
      Outlays...........................          63          80          51
                                        ====================================

        The Homeownership and Opportunity for People Everywhere Program
    provided affordable homeownership opportunities for low-income families.
    Units were converted to homeownership from public and Indian housing
    properties in HOPE 1, from FHA-insured and Government-held multifamily
    properties in HOPE 2 and from Government-owned or -held single family
    properties in HOPE 3. HOPE Grants were used for property acquisition,
    rehabilitation, mortgage subsidies, security measures, and technical
    assistance. In addition, grants have been devoted to counseling and
    training of residents, and other activities intended to help them become
    economically self-sufficient homeowners. No funding is being requested
    for fiscal year 1998. Approximately $30 million of HOPE unobligated
    balances are proposed for transfer to the Drug Elimination Grants
    program in 1997. This schedule reflects the liquidation of prior year
    balances.

    [[Page 549]]

                               Congregate Services

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0178-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                       1
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    23.95 New obligations...................                      -1
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          38          30          23
    73.10 New obligations...................                       1
    73.20 Total outlays (gross).............          -8          -7          -7
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          30          23          16
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....           8           7           7
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................           8           7           7
    ---------------------------------------------------------------------------

        Under the Congregate Services program, HUD contracted directly with
    local public housing agencies and section 202 housing for the elderly or
    disabled sponsors to supply support services, including meals and other
    services. No funding is being requested for this program in fiscal year
    1998. This schedule reflects the liquidation of prior year balances.

                          Housing Counseling Assistance

        For assistance, not otherwise provided, for providing counseling and
    advice to tenants and homeowners, both current and prospective, with
    respect to property maintenance, financial management, and such other
    matters as may be appropriate to assist them in improving their housing
    conditions and meeting the responsibilities of tenancy or homeownership,
    as authorized by section 106 of the Housing and Urban Development Act of
    1968, as amended, $23,000,000.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0156-0-1-506      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................                                  23
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                                  23
    23.95 New obligations...................                                 -23
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................                                  23
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          17           6           3
    73.10 New obligations...................                                  23
    73.20 Total outlays (gross).............         -10          -3          -3
    73.40 Adjustments in expired accounts...          -1
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           6           3          23
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          10           3           3
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                  23
    90.00 Outlays...........................          10           3           3
    ---------------------------------------------------------------------------

        The Housing Counseling Assistance program provides comprehensive
    housing counseling services to eligible homeowners and tenants,
    including pre-purchase, default and renter counseling.

                        Section 8 Moderate Rehabilitation

                              single room occupancy

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0195-0-1-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................          85         106
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................         191         106
    23.95 New obligations...................         -85        -106
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....         106
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         319         382         433
    73.10 New obligations...................          85         106
    73.20 Total outlays (gross).............         -21         -55         -51
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         382         433         382
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          21          55          51
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................          21          55          51
    ---------------------------------------------------------------------------

        Section 8 assistance for single room occupancy dwellings is
    authorized by Title IV, subtitle E, of the Stewart B. McKinney Homeless
    Assistance Act, as amended by the Housing and Community Development Act
    of 1992. Since fiscal year 1995, these activities have been funded in
    the Homeless Assistance Grants account.

                   Manufactured Home Inspection and Monitoring

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5271-0-2-376      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, start of year............
        Receipts:
    02.01 Manufactured home inspection and
            monitoring......................          13          14          16
        Appropriation:
    05.01 Manufactured home inspection and
            monitoring......................         -13         -14         -16
    07.99 Total balance, end of year........
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5271-0-2-376      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Transfer to salaries and expenses.           1           1           1
    00.02 Other program costs...............          11          13          14
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              25.2).........................          12          14          15
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           7           9          10
    22.00 New budget authority (gross)......          13          14          16
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          20          23          26
    23.95 New obligations...................         -12         -14         -15
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....           9          10          10
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    60.25 Appropriation (special fund,
            indefinite).....................          13          14          16
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation           2           2           3
    73.10 New obligations...................          12          14          15

    [[Page 550]]

    73.20 Total outlays (gross).............         -12         -13         -15
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           2           3           3
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................          12          13          15
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          13          14          16
    90.00 Outlays...........................          12          13          15
    ---------------------------------------------------------------------------

        Section 620 of the National Manufactured Housing Construction and
    Safety Standards Act of 1974, as amended, authorizes enforcement of
    appropriate construction standards for the construction, design and
    performance of manufactured homes to assure their quality, durability,
    and safety. All manufactured homes produced since the standards took
    effect on June 15, 1976 must comply with Federal construction and safety
    standards. The States are actively encouraged to participate in the
    program under compliance plans approved by HUD.

        A fee is charged to the manufacturers for each manufactured home
    produced to cover the costs of the monitoring and enforcement activities
    by HUD and its contract agents. Fees are deposited in a special fund
    administered by the Department, and a portion of the fee receipts are
    transferred to the salaries and expenses account to defray the direct
    administrative expenses of the program.

                              Interstate Land Sales

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5270-0-2-376      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, start of year............
        Receipts:
    02.01 Interstate land sales.............                       1           1
        Appropriation:
    05.01 Interstate land sales.............                      -1          -1
    07.99 Total balance, end of year........
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5270-0-2-376      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            25.2)...........................                       1           1
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                       1           1
    23.95 New obligations...................                      -1          -1
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    60.25 Appropriation (special fund,
            indefinite).....................                       1           1
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................                       1           1
    73.20 Total outlays (gross).............                      -1          -1
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................                       1           1
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                       1           1
    90.00 Outlays...........................                       1           1
    ---------------------------------------------------------------------------

        The Interstate Land Sales Full Disclosure Act provides protection to
    the public with respect to purchases or leases of subdivision lots.
    Statements of record must be filed with the Secretary before
    subdivisions with 100 or more lots may be sold in interstate commerce,
    except when the subdivision is eligible for exemption.

        The Secretary is authorized to charge a fee, to be paid by the
    developer when filing a statement of record. The fee receipts are
    permanently appropriated and have helped finance a portion of the direct
    administrative expenses incurred in program operations.

    Public enterprise funds:

                             Title IV--Corporations

        Corporations and agencies of the Department of Housing and Urban
    Development which are subject to the Government Corporation Control Act,
    as amended, are hereby authorized to make such expenditures, within the
    limits of funds and borrowing authority available to each such
    corporation or agency and in accord with law, and to make such contracts
    and commitments without regard to fiscal year limitations as provided by
    section 104 of the Act as may be necessary in carrying out the programs
    set forth in the budget for [1997] 1998 for such corporation or agency
    except as hereinafter provided: Provided, That collections of these
    corporations and agencies may be used for new loan or mortgage purchase
    commitments only to the extent expressly provided for in this Act
    (unless such loans are in support of other forms of assistance provided
    for in this or prior appropriations Acts), except that this proviso
    shall not apply to the mortgage insurance or guaranty operations of
    these corporations, or where loans or mortgage purchases are necessary
    to protect the financial interest of the United States Government.
    (Departments of Veterans Affairs and Housing and Urban Development, and
    Independent Agencies Appropriations Act, 1997.)

                         Rental Housing Assistance Fund

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4041-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            25.2)...........................          55          57          51
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....           1           1           1
    22.00 New budget authority (gross)......          55          57          51
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          56          57          51
    23.95 New obligations...................         -55         -57         -51
    24.90 Unobligated balance available, end
            of year: Fund balance...........           1           1           1
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............          55          57          51
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Fund balance.           8           8           1
    73.10 New obligations...................          55          57          51
    73.20 Total outlays (gross).............         -55         -64         -51
    74.90 Unpaid obligations, end of year:
            Obligated balance: Fund balance.           8           1           1
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................          47          57          51
    86.98 Outlays from permanent balances...           8           7
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........          55          64          51
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.40   Offsetting collections (cash)
              from: Non-Federal sources.....         -55         -57         -51
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................                       7
    ---------------------------------------------------------------------------

    [[Page 551]]

        The Housing and Urban Development Act of 1968 authorized the
    Secretary to establish a revolving fund into which rental collections in
    excess of the established basic rents for units in section 236
    subsidized projects would be deposited.

        The Housing and Community Development Amendment of 1978 authorized
    the Secretary, subject to approval in appropriation acts, to transfer
    excess rent collections received after 1978 to the Troubled Projects
    Operating Subsidy program, renamed the Flexible Subsidy Fund. Prior to
    that time, collections were used for paying tax and utility increases in
    section 236 projects. The Housing and Community Development Act of 1980
    amended the 1978 Act by authorizing the transfer of excess rent
    collections regardless of when collected. This Budget proposes that the
    resources from the Rental Housing Assistance Fund continue to be
    transferred to the Flexible Subsidy Fund.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4041-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................          61             53            57             51
    0102  Expense...........................         -61            -53           -57            -51
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4041-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................           8              8             1              1
    1206  Non-Federal assets: Receivables,
            net.............................           7              7
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................          15             15             1              1
        LIABILITIES:
          Federal liabilities:

    2101    Accounts payable................           8              4
    2105    Other...........................                          3
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............           8              7
        NET POSITION:
    3300  Cumulative results of operations..           7              7             1              1
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............           7              7             1              1
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position          15             14             1              1
    -----------------------------------------------------------------------------------------------

                              Flexible Subsidy Fund

        From the Rental Housing Assistance Fund, all uncommitted balances of
    excess rental charges as of September 30, 1997, and any collections made
    during fiscal year 1998, shall be transferred to the Flexible Subsidy
    Fund, as authorized by section 236(g) of the National Housing Act, as
    amended.

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4044-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            41.0)...........................          80          15          60
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

            Fund balance:
    21.90     Treasury balance: Uncommitted.          27          88
    21.90     Treasury balance:
                Administratively committed..          82          15          60
    21.91   U.S. Securities: Par value,
              uncommitted...................          46          39         135
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............         155         142         195
    22.00 New budget authority (gross)......          67          68          63
    22.30 Unobligated balance expiring......          -1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         221         210         258
    23.95 New obligations...................         -80         -15         -60
          Unobligated balance available, end of year:

            Fund balance:
    24.90     Fund balance, Uncommitted.....          88                      33
    24.90     Fund balance: Administratively
                committed...................          15          60
    24.91   U.S. Securities: Par value
              uncommitted...................          39         135         165
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................         142         195         198
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............          67          68          63
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.91 Unpaid obligations, start of year:
            Obligated balance: U.S.
            Securities: Par value...........         114         101          21
    73.10 New obligations...................          80          15          60
    73.20 Total outlays (gross).............         -93         -95         -73
    74.91 Unpaid obligations, end of year:
            Obligated balance: U.S.
            Securities: Par value...........         101          21           7
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.98 Outlays from permanent balances...          93          95          73
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
    88.00     Federal sources...............         -56         -57         -51
    88.20     Interest on U.S. securities...          -8          -8          -9
    88.40     Non-Federal sources...........          -3          -3          -3
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........         -67         -68         -63
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................          26          27          10
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4044-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........         584         675         768
    1231  Disbursements: Direct loan
            disbursements...................          93          95          73
    1251  Repayments: Repayments and
            prepayments.....................          -2          -2          -3
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........         675         768         838
    ---------------------------------------------------------------------------

        The Flexible Subsidy Fund assisted financially troubled subsidized
    projects under certain FHA authorities. The subsidies were intended to
    prevent potential losses to the FHA fund resulting from project
    insolvency and to preserve these projects as a viable source of housing
    for low and moderate-income tenants. Priority was given to projects with
    Federal insurance-in-force and then to those with mortgages that had
    been assigned to the Department of Housing and Urban Development.

        A portion of Flexible Subsidy capital improvement loans were used,
    along with incentives available in the Emergency Low-Income Housing
    Preservation program, to extend affordability requirements for projects
    eligible to prepay mortgages.

        The budget assumes that the account will continue to serve as a
    repository of excess rental charges appropriated from the Rental Housing
    Assistance Fund. Beginning in FY 1996 these resources are no longer used
    for new reservations, but they continue to offset Flexible Subsidy
    outlays and other discretionary expenditures.

                      Summary of Administrative Commitments

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Program by activities:
      Capital investments:
        Flexible subsidy reservations...          18          60
        Administrative commitments,
          start of year.................          82          15          60
        Cancellation of prior year
          commitments...................          -5
        Administrative commitments, end
          of year.......................         -15         -60
                                        ------------------------------------
          Capital investment--
            obligations.................          80          15          60
                                        ====================================

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4044-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................          71             66            65             60
    0102  Expense...........................         -86            -64           -82            -62
                                            ------------ --------------  ------------  -------------

    [[Page 552]]

    0109  Net income or loss (-)............         -15              2           -17             -2
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4044-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....         126            120            76             44
            Investments in US securities:
    1102      Treasury securities, par......          82            140           156            172
    1106      Receivables, net..............           6              4
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............         584            676           768            838
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................        -493           -536          -609           -665
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................          91            140           159            173
    1901  Other Federal assets: Other assets          26              4
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................         331            408           391            389
        LIABILITIES:
    2201  Non-Federal liabilities: Accounts
            payable.........................           2              1
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............           2              1
        NET POSITION:
    3100  Appropriated capital..............         217            217           217            217
    3300  Cumulative results of operations..         112            191           174            172
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............         329            408           391            389
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position         331            409           391            389
    -----------------------------------------------------------------------------------------------

                          Homeownership Assistance Fund

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4043-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, start of year............                                   4
                                               ---------   ---------  ----------
    03.00 Offsetting Collections............                       4           4
    04.00 Total: Balances and collections...                       4           8
    07.99 Total balance, end of year........                       4           8
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4043-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Refunds of offsetting collections.          31
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              44.0).........................          31
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

    21.49   Contract authority..............          57          57          57
    21.90   Treasury balance................           2           2           2
    21.91   U.S. Securities: Par value......          49          18          18
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............         108          77          77
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         108          77          77
    23.95 New obligations...................         -31
          Unobligated balance available, end of year:

    24.49   Contract authority..............          57          57          57
    24.90   Treasury balance................           2           2           2
    24.91   U.S. Securities: Par value......          18          18          18
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................          77          77          77
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...                       4           4
    68.45   Portion not available for
              obligation (limitation on
              obligations)..................                      -4          -4
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Fund balance.          -1          -1          -1
    73.10 New obligations...................          31
    73.20 Total outlays (gross).............         -31
    74.90 Unpaid obligations, end of year:
            Obligated balance: Fund balance.          -1          -1          -1
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.98 Outlays from permanent balances...          31
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
    88.00     Federal sources: Interest on
                U.S. securities.............                      -3          -3
    88.40     Non-Federal sources...........                      -1          -1
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........                      -4          -4
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                      -4          -4
    90.00 Outlays...........................          31          -4          -4
    ---------------------------------------------------------------------------

                Status of Contract Authority (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4043-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    0100  Balance, start of year............          57          57          57
    0700  Balance, end of year..............          57          57          57
    ---------------------------------------------------------------------------

        The Homeownership Assistance Fund was established by the Housing and
    Urban-Rural Recovery Act of 1983. It provided for the receipt of
    recaptures of budget authority, cash, and interest earnings under the
    restructured section 235 program. The funds were authorized to be used,
    to the extent approved in Appropriation Acts, by the Secretary to
    provide additional section 235 assistance payments for mortgagors who
    are unable to assume the full payment due under the mortgage after the
    termination of the original 10-year assistance payments contract.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4043-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................           4              2             4              4
    0102  Expense...........................
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............           4              2             4              4
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4043-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....           2              1             2              2
            Investments in US securities:
    1102      Treasury securities, par......          49             18            21             21
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................          51             19            23             23
        NET POSITION:
    3300  Cumulative results of operations..          51             19            23             23
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............          51             19            23             23
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position          51             19            23             23
    -----------------------------------------------------------------------------------------------

    [[Page 553]]

                        Nehemiah Housing Opportunity Fund

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4071-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            33.0)...........................           2          21
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....          18          21
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           5
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          23          21
    23.95 New obligations...................          -2         -21
    24.90 Unobligated balance available, end
            of year: Fund balance...........          21
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Fund balance.          18          11          22
    73.10 New obligations...................           2          21
    73.20 Total outlays (gross).............          -4         -10         -21
    73.45 Adjustments in unexpired accounts.          -5
    74.90 Unpaid obligations, end of year:
            Obligated balance: Fund balance.          11          22           1
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....           4          10          21
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................           4          10          21
    ---------------------------------------------------------------------------

        The Nehemiah grants program was authorized by the Housing and
    Community Development Act of 1987 to provide loans to eligible families
    to assist in the purchase of new or substantially rehabilitated units.
    This schedule reflects the liquidation of remaining reserved and
    obligated balances. During fiscal year 1997, up to $20 million of
    unobligated balances were available for homeownership activities
    pursuant to Public Law 104-204.

    Credit accounts:

                 FHA--Mutual Mortgage Insurance Program Account

                         (including transfers of funds)

        During fiscal year [1997] 1998, commitments to guarantee loans to
    carry out the purposes of section 203(b) of the National Housing Act, as
    amended, shall not exceed a loan principal of $110,000,000,000[:
    Provided, That during fiscal year 1997, the Secretary shall sell
    assigned mortgage notes having an unpaid principal balance of up to
    $2,000,000,000, which notes were originally insured under section 203(b)
    of the National Housing Act: Provided further, That the Secretary may
    use the amount of any negative subsidy resulting from the sale of such
    assigned mortgage notes during fiscal year 1997 for the purposes
    included under this heading].
        During fiscal year [1997] 1998, obligations to make direct loans to
    carry out the purposes of section 204(g) of the National Housing Act, as
    amended, shall not exceed $200,000,000: Provided, That the foregoing
    amount shall be for loans to nonprofit and governmental entities in
    connection with sales of single family real properties owned by the
    Secretary and for- merly insured under [section 203 of such Act] the
    Mutual Mortgage Insurance Fund.
        For administrative expenses necessary to carry out the guaranteed
    and direct loan program, [$350,595,000] $333,421,000, to be derived from
    the FHA-mutual mortgage insurance guaranteed loans receipt account, of
    which not to exceed [$343,483,000] $326,309,000 shall be transferred to
    the appropriation for departmental salaries and expenses; and of which
    not to exceed $7,112,000 shall be transferred to the appropriation for
    the Office of Inspector General. (Departments of Veterans Affairs and
    Housing and Urban Development, and Independent Agencies Appropriations
    Act, 1997.)

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0183-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Receipts:
    02.01 FHA Mutual Mortgage Insurance
            Guaranteed Loan, negative
            subsidies.......................         523         351       1,576
    02.02 FHA Mutual Mortgage Insurance
            Guaranteed Loan, negative
            subsidies, legislative proposal
            not subject to PAYGO............                                  52
    02.03 FHA Mutual Mortgage Insurance
            Guaranteed Loan, negative
            subsidies, legislative proposal
            subject to PAYGO................                                 370
                                               ---------   ---------  ----------
    02.99   Total receipts..................         523         351       1,998
        Appropriation:
    05.01 FHA mutual mortgage insurance
            program account.................        -523        -351        -333
                                               ---------   ---------  ----------
    05.99 Subtotal appropriation............        -523        -351        -333
    07.99 Total balance, end of year........                               1,665
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0183-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.09 Administrative expenses...........         342         351         333
    00.10 Subsidy rate reestimate...........         181
                                               ---------   ---------  ----------
    10.00   Total obligations...............         523         351         333
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......         523         351         333
    23.95 New obligations...................        -523        -351        -333
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.25   Appropriation (special fund,
              definite).....................         342         351         333
          Permanent:

    60.25   Appropriation (special fund,
              indefinite)...................         181
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         523         351         333
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................         523         351         333
    73.20 Total outlays (gross).............        -523        -351        -333
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority         342         351         333
    86.97 Outlays from new permanent
            authority.......................         181
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         523         351         333
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         523         351         333
    90.00 Outlays...........................         523         351         333
    ---------------------------------------------------------------------------

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0183-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Direct loan levels supportable by subsidy
                    budget authority:
    1150  Direct loan levels................         200         200         200
                                               ---------   ---------  ----------
    1159    Total direct loan levels........         200         200         200
        Direct loan subsidy (in percent):
    1320  Subsidy rate......................        0.00        0.00        0.00
                                               ---------   ---------  ----------
    1329    Weighted average subsidy rate...        0.00        0.00        0.00
    ----------------------------------------------------------------------------

        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2150  MMI Fund, Section 203(b)..........      74,324      93,173      83,450
    2150  Standby commitment authority......                  16,827      26,550
                                               ---------   ---------  ----------
    2159    Total loan guarantee levels.....      74,324     110,000     110,000
        Guaranteed loan subsidy (in percent):
    2320  Subsidy rate......................       -2.77       -2.88       -2.62
                                               ---------   ---------  ----------
    2329    Weighted average subsidy rate...       -2.77       -2.88       -2.62
        Guaranteed loan subsidy budget authority:
    2330  MMI Section 203(b) negative
            subsidy.........................      -1,549      -1,855      -1,523
                                               ---------   ---------  ----------
    2339    Total subsidy budget authority..      -1,549      -1,855      -1,523

    [[Page 554]]

        Guaranteed loan subsidy outlays:
    2340  Subsidy outlays...................      -1,549      -1,855      -1,523
                                               ---------   ---------  ----------
    2349    Total subsidy outlays...........      -1,549      -1,855      -1,523
    ---------------------------------------------------------------------------

        FHA will continue to provide mortgage insurance to encourage lenders
    to make credit available to expand homeownership. FHA will continue to
    predominantly serve borrowers that the conventional market does not
    adequately serve: first-time homebuyers; minorities; lower-income
    families; and, residents of underserved areas (central cities and rural
    areas). Currently, the maximum mortgage amount for FHA-insured one-
    family loans is set at 95 percent of area median house price, provided
    that the amount is never less than 38 percent of the conforming loan
    limit--the maximum mortgage amount for loans purchased by the housing
    secondary market Government-Sponsored Enterprises, Fannie Mae and
    Freddie Mac--and never more than 75 percent of the conforming loan
    limit. The Administration proposes to increase the maximum mortgage
    amount for FHA-insured loans in all areas to equal the conforming loan
    limit. In addition, starting in 1997, FHA hopes to test the viability of
    sharing single-family mortgage risk between the Federal Government and
    other partners, including private mortgage insurers and state agencies.

        Credit Subsidy and Administrative Expenses.--As required by the
    Federal Credit Reform Act of 1990, this account records administrative
    expenses for this program, as well as the subsidy costs associated with
    the loan guarantees committed in 1992 and thereafter, if any. The
    subsidy amounts are estimated on a present value basis; the
    administrative expenses are estimated on a cash basis.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0183-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    99.0  Reimbursable obligations:
            Subtotal, reimbursable
            obligations.....................         523         351         333
                                               ---------   ---------  ----------
    99.9    Total obligations...............         523         351         333
    ---------------------------------------------------------------------------

                  FHA-Mutual Mortgage Insurance Program Account

                    (Legislative proposal, subject to PAYGO)

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0183-4-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2150  MMI Fund, Section 203(b)..........                               7,094
        Guaranteed loan subsidy (in percent):
    2320  Subsidy rate......................                               -0.37
                                               ---------   ---------  ----------
    2329    Weighted average subsidy rate...                               -0.37
        Guaranteed loan subsidy budget authority:
    2330  MMI Section 203(b) negative
            subsidy.........................                                -370
                                               ---------   ---------  ----------
    2339    Total subsidy budget authority..                                -370
        Guaranteed loan subsidy outlays:
    2340  Subsidy outlays...................                                -370
                                               ---------   ---------  ----------
    2349    Total subsidy outlays...........                                -370
    ---------------------------------------------------------------------------

        This adjustment reflects the effect of two pieces of legislation.
    The first is the Administration's proposal to increase the maximum
    mortgage amount for single family FHA-insured loans in all areas to
    equal the GSE conforming loan limits. If enacted, this change is
    anticipated to increase insurance written by $7 billion in 1998,
    generating $206 million in additional negative credit subsidy. The
    second is anticipated action by the Congress to eliminate permanently
    the assignment program and replace it with additional loss mitigation
    tools. This change has already been enacted for insurance endorsed in
    all prior years. If enacted permanently, it would decrease the
    (negative) credit subsidy rate for MMI loans in 1998 by 0.37 percent,
    producing $164 million in negative credit subsidy in 1998. These two
    changes would result in additional outlay reductions in subsequent
    years.

          FHA--Mutual Mortgage Insurance Direct Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4242-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loans......................           3         200         200
    00.02 Interest paid to Treasury.........                       7          11
    00.03 Claims & other....................                                   4
                                               ---------   ---------  ----------
    10.00   Total obligations...............           3         207         215
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....                       1          61
    22.00 New financing authority (gross)...           4         267         311
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......           4         268         372
    23.95 New obligations...................          -3        -207        -215
    24.90 Unobligated balance available, end
            of year: Fund balance...........           1          61         157
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    67.15 Authority to borrow (indefinite)..           3         200         200
    68.00 Spending authority from offsetting
            collections: Offsetting
            collections (cash)..............           1          67         111
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................           4         267         311
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................           3         207         215
    73.20 Total financing disbursements
            (gross).........................          -3        -207        -215
    87.00 Total financing disbursements
            (gross).........................           3         207         215
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
    88.25     Interest on uninvested funds..                                  -2
    88.40     Other collections from non-
                Federal sources.............          -1         -67        -109
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........          -1         -67        -111
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............           3         200         200
    90.00 Financing disbursements...........           2         140         104
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from direct loans obligated in 1992 and thereafter (including
    modifications of direct loans that resulted from obligations in any
    year). The amounts in this account are a means of financing and are not
    included in the budget totals. The $200 million in 1998 direct loan
    limitation in the MMI Fund would permit the Department to use Purchase
    Money Mortgages (PMMs) to help finance the sale of acquired single
    family properties. HUD would extend credit for these single-family homes
    to community nonprofit organizations or local government entities who
    would be expected to sell the properties to low- and moderate-income
    buyers. The use of PMMs provides a tool for State and local nonprofit
    organizations to use in revitalizing communities, and creates

    [[Page 555]]

    enhanced homeownership opportunities for low- and moderate-income
    families.

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4242-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on obligations:
    1111  Limitation on direct loans........         200         200         200
    1112  Unobligated direct loan limitation        -197
                                               ---------   ---------  ----------
    1150    Total direct loan obligations...           3         200         200
    ----------------------------------------------------------------------------

        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........                       2         145
    1231  Disbursements: Direct loan
            disbursements...................           3         200         200
    1251  Repayments: Repayments and
            prepayments.....................          -1         -57         -88
    1263  Write-offs for default: Direct
            loans...........................                                  -3
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........           2         145         255
    ---------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4242-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Net value of assets related to
              post-1991 direct loans
              receivable:

    1401    Direct loans receivable, gross..                          2           145            254
                                            ------------ --------------  ------------  -------------
    1499      Net present value of assets
                related to direct loans.....                          2           145            254
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................                          2           145            254
    -----------------------------------------------------------------------------------------------

        FHA--Mutual Mortgage Insurance Guaranteed Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4587-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Default claims and other..........       1,698       1,562       1,944
    00.04 Working capital fund
            reimbursements..................          19          19          19
    00.05 Payment of negative subsidy to
            receipt account.................         342         351       1,523
    00.06 Payment of negative subsidy to
            liquidating account.............       1,473       1,182
    00.07 Subsidy reestimate paid to
            liquidating account.............       1,227
    00.08 Interest payments to Treasury.....         153         184         215
    00.09 Payment to liquidating account for
            asset sale......................       1,321       1,011
                                               ---------   ---------  ----------
    10.00   Total obligations...............       6,233       4,309       3,701
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....         701         907       1,321
    22.00 New financing authority (gross)...       6,439       4,722       3,908
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       7,140       5,629       5,229
    23.95 New obligations...................      -6,233      -4,309      -3,701
    24.90 Unobligated balance available, end
            of year: Fund balance...........         907       1,321       1,528
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    67.15 Authority to borrow (indefinite)..       1,527
    68.00 Spending authority from offsetting
            collections: Offsetting
            collections (cash)..............       4,912       4,722       3,908
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................       6,439       4,722       3,908
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Obligated
            balance.........................          77          47          47
    73.10 New obligations...................       6,233       4,309       3,701
    73.20 Total financing disbursements
            (gross).........................      -6,263      -4,309      -3,701
    74.90 Unpaid obligations, end of year:
            Obligated balance: Obligated
            balance.........................          47          47          47
    87.00 Total financing disbursements
            (gross).........................       6,263       4,309       3,701
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
    88.25     Interest on uninvested funds..        -114        -163        -146
              Non-Federal sources:
    88.40       Fees and premiums...........      -2,515      -2,519      -2,709
    88.40       Recoveries on defaulted
                  notes.....................        -670        -945      -1,053
    88.40       Gross proceeds from asset
                  sales.....................      -1,613      -1,095
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........      -4,912      -4,722      -3,908
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............       1,527
    90.00 Financing disbursements...........       1,350        -414        -207
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4587-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........     110,000     110,000     110,000
    2112  Uncommitted loan guarantee
            limitation......................     -35,676     -16,827     -26,550
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................      74,324      93,173      83,450
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........     203,414     242,407     283,605
    2231  Disbursements of new guaranteed
            loans...........................      59,221      65,440      60,718
    2251  Repayments and prepayments........     -18,616     -22,858     -22,458
          Adjustments:

    2261    Terminations for default that
              result in loans receivable....        -416        -145        -231
    2262    Terminations for default that
              result in acquisition of
              property......................      -1,154      -1,118      -1,365
    2263    Terminations for default that
              result in claim payments......         -42        -121        -166
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........     242,407     283,605     320,103
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..     242,407     283,605     320,103
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......         413         866         818
    2331    Disbursements for guaranteed
              loan claims...................         416         145         232
    2351    Repayments of loans receivable..          -1         -36         -34
    2364    Other adjustments, net..........          38        -157        -161
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......         866         818         855
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from loans insured in 1992 and thereafter. The amounts in this
    account are considered a means of financing and are not included in the
    budget totals.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4587-0-3-371   1995 actual
                                                     \1\    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................         777            954         1,368            724
          Net value of assets related to
              post-1991 acquired defaulted
              guaranteed loans receivable:

    1501    Defaulted guaranteed loans
              receivable, gross.............         413            866           818            855
    1504    Foreclosed property.............         324            521           534            609
    1505    Allowance for subsidy cost......        -429           -405          -399           -437
                                            ------------ --------------  ------------  -------------
    1599      Net value of assets related to
                defaulted guaranteed loan...         308            982           953          1,027
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       1,085          1,936         2,321          1,751
        LIABILITIES:
    2103  Federal liabilities: Federal
            liabilities, Debt...............       1,171          2,698         2,698          1,838
    2204  Non-Federal liabilities:
            Liabilities for loan guarantees.         -86           -762          -377            -87
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       1,085          1,936         2,321          1,751
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       1,085          1,936         2,321          1,751
    -----------------------------------------------------------------------------------------------

    [[Page 556]]

        \1\ As reflected in the 1997 Budget. Subsidy reestimates for fiscal
    year 1996 disbursements will be performed for the mid-session review of
    the Budget.

    FHA--Mutual Mortgage and Cooperative Housing Insurance Funds Liquidating
                                     Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4070-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Operating expenses:

    00.03   Other operating costs...........         216         147         146
    00.04   Working Capital Fund
              reimbursements................          31          31          31
    00.05   Participation payments..........           1           1           1
                                               ---------   ---------  ----------
    00.91     Total operating expenses......         248         179         178
          Capital investment:

    01.02   Assignment of defaulted
              mortgages.....................         465         309          73
    01.03   Acquisition of real properties..       2,017         785         485
    01.05   Acquisition of other assets.....          39          39          39
    01.07   Capitalized property expenses...         264         159          76
    01.08   Loss on defaulted guaranteed
              loans.........................           2          10           8
    01.09   Preforeclosure sale claims......          18          73          59
                                               ---------   ---------  ----------
    01.91     Total capital investment......       2,805       1,375         740
                                               ---------   ---------  ----------
    10.00   Total obligations...............       3,053       1,554         918
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

    21.90   Treasury balance................        -163       2,905       1,242
            U.S. Securities:
    21.91     Par value.....................       6,673       7,045      11,161
    21.92     Unrealized discounts..........         -66         -87         -67
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............       6,444       9,863      12,336
    22.00 New budget authority (gross)......       6,472       4,027       1,438
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......      12,916      13,890      13,774
    23.95 New obligations...................      -3,053      -1,554        -918
          Unobligated balance available, end of year:

    24.90   Fund balance....................       2,905       1,242         965
            U.S. Securities:
    24.91     Par value.....................       7,045      11,161      11,958
    24.92     Unrealized discounts..........         -87         -67         -67
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................       9,863      12,336      12,856
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............       6,472       4,027       1,438
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

            Obligated balance:
    72.90     Fund balance..................         659                     685
    72.91     U.S. Securities: Par value....                     685
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............         659         685         685
    73.10 New obligations...................       3,053       1,554         918
    73.20 Total outlays (gross).............      -3,031      -1,554        -918
    73.32 Obligated balance transferred from
            other accounts..................           4
          Unpaid obligations, end of year:

            Obligated balance:
    74.90     Fund balance..................                     685         685
    74.91     U.S. Securities: Par value....         685
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................         685         685         685
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................       2,372         869         233
    86.98 Outlays from permanent balances...         659         685         685
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........       3,031       1,554         918
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
    88.20     Interest on U.S. securities...        -531        -676        -785
              Non-Federal sources:
    88.40       Fees and premiums...........         -92         -81         -72
    88.40       Rebate of unearned prepaid
                  premiums collected........         287          48          16
    88.40       Proceeds from sale of real
                  property..................      -1,901        -962        -485
    88.40       Proceeds from sale of
                  mortgage notes............      -1,321      -1,011
    88.40       Repayment of mortgage notes
                  and sales contracts.......          -1          -1          -1
    88.40       Interest and operating
                  income....................         -31         -37         -46
    88.40       Recoveries on defaulted
                  mortgages.................        -237        -142         -22
    88.40       Other interest, dividends
                  and revenues..............                      -1         -43
    88.40       Payment from financing
                  account...................      -2,700      -1,164
    88.40       Miscellaneous collections...         -10
    88.40       Other income................          65
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........      -6,472      -4,027      -1,438
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................      -3,441      -2,473        -520
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4070-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........          15           7           5
    1251  Repayments: Repayments and
            prepayments.....................          -1          -1
    1264  Write-offs for default: Other
            adjustments, net................          -7          -1
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........           7           5           5
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4070-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........      96,145     121,587     107,374
    2251  Repayments and prepayments........     -15,754     -13,036     -11,885
          Adjustments:

    2261    Terminations for default that
              result in loans receivable....        -465        -309         -73
    2262    Terminations for default that
              result in acquisition of
              property......................      -2,017        -784        -485
    2263    Terminations for default that
              result in claim payments......         -20         -84         -67
    2264    Other adjustments, net..........      43,698
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........     121,587     107,374      94,864
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..     121,587     107,374      94,864
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......       3,886       1,862         358
    2331    Disbursements for guaranteed
              loan claims...................         465         309          73
    2351    Repayments of loans receivable..      -1,725      -1,111         -63
    2361    Write-offs of loans receivable..        -763        -702         -28
    2364    Other adjustments, net..........          -1                      -1
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......       1,862         358         339
    ---------------------------------------------------------------------------

        The Federal Housing Administration Fund currently consists of four
    separate insurance funds.

        In order to present more clearly the operations of the various
    funds, FHA's budget transactions are separated into two major business
    segments. The basic single-family insurance programs in the Mutual
    Mortgage Insurance Fund and the multifamily Cooperative Management
    Housing insurance funds (MMI/CMHI) form one segment. All other
    multifamily and other specialized insurance programs in the General
    Insurance and Special Risk Insurance funds (GI/SRI) form the other
    segment.

        The Federal Credit Reform Act of 1990 creates a structure of three
    accounts for existing credit programs. For each of the FHA business
    segments (MMI/CMHI and GI/SRI) there is a liquidating account, which
    records the revenues and costs associated with loan insurance committed
    prior to October 1, 1991; a financing account which records the revenues
    and costs associated with commitments to insure loans made after

    [[Page 557]]

    September 30, 1991; and, a program account which records the
    transactions associated with the program subsidy costs, if any, and the
    costs of administering the program.

        This liquidating account records, for this program, all cash flows
    to and from the Government resulting from MMI/CMHI loans insured prior
    to fiscal year 1992, and is shown on a cash basis. All new activity in
    this program in 1992 and thereafter (including modifications of loans
    insured in any year) is recorded in the corresponding program (86-0183)
    and financing (86-4587 and 86-4242) accounts.

        The program activity in the ``Program Highlights'' table shown below
    reflects only the activity in the MMI/CMHI liquidating and financing
    accounts. The GI/SRI program activity can be found with the GI/SRI
    liquidating account (86-4072).

                               PROGRAM HIGHLIGHTS

                            [In millions of dollars]

                                        1996 actual
                                             \1\      1997 est.   1998 est.
    Insurance initiation:
      Mortgage insurance applications
        (units).........................     977,702   1,152,163   1,016,302
                                        ====================================
    Mortgage insurance written:
      Units.............................     739,603     810,439     737,002
      Amount............................      59,221      65,440      60,718
                                        ====================================
    Insurance maintenance: Outstanding
        balance of insurance in force,
        end of year:
      Mortgage insurance................     363,995     390,979     414,967
                                        ====================================
        \1\ Unaudited preliminary results.

        Insurance reserves from operations at the end of 1996 are estimated
    to be in a surplus position for the Mutual Mortgage Insurance and
    Cooperative Management Housing insurance funds. The status of estimated
    insurance reserves from operations (retained income or deficit) through
    1998 for the MMI/CMHI account follows:

                  STATUS OF INSURANCE RESERVES FROM OPERATIONS

                            [In millions of dollars]

                                        1996 est.\1\  1997 est.   1998 est.
    Insurance fund:
      Mutual mortgage/CMHI:
        Liquidating account \2\.........       8,776      10,288      10,877
        Receipt Account \2\.............                               1,414
        \1\ Unaudited preliminary results.
        \2\ Reflects impact from the transfer of negative subsidy from the
    Financing account to the Liquidating account in 1996 and 1997. Negative
    subsidy transfers are to the Receipt Account in 1998.

        Financial condition.--The following tables reflect the revenues,
    expenses and financial condition of the MMI/CMHI liquidating funds based
    on Generally Accepted Accounting Principles.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4070-0-3-371   1995 actual
                                                     \1\   1996 actual
                                                                    \2\     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................       2,821          2,103         1,935            958
    0102  Expense...........................      -1,123         -1,097          -421           -368
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............       1,698          1,006         1,514            590
    -----------------------------------------------------------------------------------------------
        \1\ As reflected in the 1997 Budget.
        \2\ Estimated result on GAAP basis pending final audit.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4070-0-3-371   1995 actual
                                                     \1\    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....         495          2,905         1,724          1,728
            Investments in US securities:
              Treasury securities, par:
    1102        Treasury securities, par....       6,673          7,729        11,230         11,780
    1102        Unamortized net premium/
                  discount..................         -67            -87           -69            -69
    1106      Receivables, net..............         123            106           106            106
    1107      Advances and prepayments......          72
          Non-Federal assets:

    1206    Receivables, net................         159            207           207            207
    1207    Advances and prepayments........          12            -62           -62            -62
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............          15              7             6              4
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................          -3             -1            -1             -1
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................          12              6             5              3
    1701    Defaulted guaranteed loans,
              gross.........................       3,886          1,862           358            339
    1703    Allowance for estimated
              uncollectible loans and
              interest (-)..................        -738           -495           -95            -90
    1704    Defaulted guaranteed loans and
              interest receivable, net......       3,148          1,367           263            249
    1705    Allowance for uncollectables
              from foreclosed property......        -526           -354          -140            -71
    1706    Foreclosed property.............       1,379            872           344            174
                                            ------------ --------------  ------------  -------------
    1799      Value of assets related to
                loan guarantees.............       4,001          1,885           467            352
    1901  Other Federal assets: Other assets                         18             7             15
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................      11,480         12,707        13,615         14,060
        LIABILITIES:
    2101  Federal liabilities: Accounts
            payable.........................           4
          Non-Federal liabilities:

    2201    Accounts payable................         496            676           567            542
    2206    Pension and other actuarial
              liabilities...................       2,254          2,175         1,729          1,626
    2207    Unearned revenue and advances...       1,805          1,061         1,013            997
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       4,559          3,912         3,309          3,165
        NET POSITION:
    3100  Appropriated capital..............          19             19            18             18
    3300  Cumulative results of operations..       6,902          8,776        10,288         10,877
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............       6,921          8,795        10,306         10,895
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position      11,480         12,707        13,615         14,060
    -----------------------------------------------------------------------------------------------
        \1\ As reflected in the 1997 Budget.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4070-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................         246         178         177
    32.0  Land and structures...............       2,282         943         560
    33.0  Investments and loans.............         504         348         112
    42.0  Insurance claims and indemnities..          20          84          68
    44.0  Refunds...........................           1           1           1
                                               ---------   ---------  ----------
    99.0      Subtotal, direct obligations..       3,053       1,554         918
                                               ---------   ---------  ----------
    99.9    Total obligations...............       3,053       1,554         918
    ---------------------------------------------------------------------------

                  FHA--General and Special Risk Program Account

                         (including transfers of funds)

        For the cost of guaranteed loans, as authorized by sections 238 and
    519 of the National Housing Act (12 U.S.C. 1715z-3 and 1735c), including
    the cost of loan guarantee modifications (as that term is defined in
    section 502 of the Congressional Budget Act of 1974, as amended)
    [$85,000,000] $81,000,000, to remain available until expended: Provided,
    That these funds are available to subsidize total loan principal, any
    part of which is to be guaranteed, of up to $17,400,000,000: [Provided
    further, That during fiscal year 1997, the Secretary shall sell assigned
    notes having an unpaid principal balance of up to $2,500,000,000, which
    notes are held by the Secretary under the General Insurance and Special
    Risk Insurance funds:] Provided further, That any amounts made available
    in any prior appropriations Act for the cost (as such term is defined in
    section 502 of the Congressional Budget Act of 1974) of guaranteed loans
    that are obligations of the funds established under section 238 or 519
    of the National Housing Act that have not been obligated or that are
    deobligated shall be available to the Secretary of Housing and Urban
    Development in connection with the making of such guarantees and shall
    remain available until expended, notwithstanding the expiration of any
    period of availability otherwise applicable to such amounts.
        Gross obligations for the principal amount of direct loans, as
    authorized by sections 204(g), 207(l), 238(a), and 519(a) of the
    National Housing Act, shall not exceed $120,000,000; of which not to
    exceed $100,000,000 shall be for bridge financing in connection with the
    sale of multifamily real properties owned by the Secretary and for

    [[Page 558]]

    merly insured under such Act; and of which not to exceed $20,000,000
    shall be for loans to nonprofit and governmental entities in connection
    with the sale of single-family real properties owned by the Secretary
    and formerly insured under such Act.
        In addition, for administrative expenses necessary to carry out the
    guaranteed and direct loan programs, [$207,470,000] $222,305,000, of
    which [$203,299,000] $218,134,000, including $25,000,000 for the
    enforcement of housing standards on FHA-insured multifamily projects,
    shall be transferred to the appropriation for departmental salaries and
    expenses; and of which $4,171,000 shall be transferred to the
    appropriation for the Office of Inspector General. (Departments of
    Veterans Affairs and Housing and Urban Development, and Independent
    Agencies Appropriations Act, 1997.)

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0200-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, subsidy downward
            reestimate, start of year.......       1,209       1,506       2,119
        Receipts:
    02.01 Negative Subsidies................         721         613         122
    02.02 Negative Subsidies, legislative
            proposal........................                                 665
    02.03 Downward reestimates of subsidies.         110
                                               ---------   ---------  ----------
    02.99   Total receipts..................         831         613         787
                                               ---------   ---------  ----------
    04.00 Total: Balances and collections...       2,040       2,119       2,906
        Appropriation:
    05.01 General and special risk program
            account.........................        -534
    07.99 Total balance, end of year........       1,506       2,119       2,906
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0200-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Guaranteed loan subsidy...........         143         176         154
    00.02 Prior year adjustment.............          32
    00.03 Indirect modification subsidy.....          37
    00.04 FHA multi-family demonstration....                      30          10
    00.09 Administrative expenses...........         202         207         222
                                               ---------   ---------  ----------
    10.00   Total obligations...............         414         413         386
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

            Uninvested balance:
    21.40     Uncommitted...................          31         534         439
    21.40     Administratively committed....          69          56          40
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............         100         590         479
    22.00 New budget authority (gross)......         905         302         303
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       1,005         892         782
    23.95 New obligations...................        -414        -413        -386
          Unobligated balance available, end of year:

            Uninvested balance:
    24.40     Uncommitted...................         534         439         358
    24.40     Administratively committed....          56          40          38
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................         590         479         396
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Appropriation:

    40.00   Appropriation...................         202
    40.00   Indirect modification subsidy...          37
    40.00   FHA multi-family demonstration..          30          10
    40.00   Appropriation...................          85
    40.25 Appropriation (special fund,
            indefinite).....................         534         292         303
                                               ---------   ---------  ----------
    43.00   Appropriation (total)...........         888         302         303
    50.05 Reappropriation (indefinite)......          17
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         905         302         303
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          30          46          88
    73.10 New obligations...................         414         413         386
    73.20 Total outlays (gross).............        -398        -371        -396
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          46          88          78
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority         307         271         283
    86.93 Outlays from current balances.....          91         100         113
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         398         371         396
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         905         302         303
    90.00 Outlays...........................         398         371         396
    ---------------------------------------------------------------------------

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0200-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Direct loan levels supportable by subsidy
                    budget authority:
    1150  Single-family PMMs................          20          20          20
    1150  Multifamily bridge loans..........         100         100         100
                                               ---------   ---------  ----------
    1159    Total direct loan levels........         120         120         120
    ----------------------------------------------------------------------------

        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2150  Multifamily development...........       1,013       1,170       1,053
    2150  Refinance of FHA-insured mortgages       1,134       1,000         927
    2150  Risk sharing programs.............         337         577         876
    2150  Mixed Income......................                     404         150
    2150  Cooperatives......................          31          25          20
    2150  Health and residential care
            facilities......................         694       1,748       2,052
    2150  Neighborhood improvement program..                                 100
    2150  Small Projects....................                     374         537
    2150  Micro Loans.......................                     671         895
    2150  Indian Housing....................                       2           2
    2150  Preservation......................         267         150
    2150  Single family, negative...........       7,619       8,569       8,388
    2150  Title I guarantees................       1,656       2,710       2,400
                                               ---------   ---------  ----------
    2159    Total loan guarantee levels.....      12,751      17,400      17,400
        Guaranteed loan subsidy (in percent):
    2320  Multifamily development...........       11.96        8.78        8.51
    2320  Refinance of multifamily mortgages        2.51       -0.79       -0.75
    2320  Mixed Income......................        0.00       12.26       12.13
    2320  Cooperatives......................       27.04       30.47       29.21
    2320  Nursing Homes.....................       -1.98        0.00       -0.70
    2320  Hospitals.........................       -3.78        0.00        1.75
    2320  Preservation......................       -1.96        0.00        0.00
    2320  234c/Other single family programs.       -1.34       -1.55       -1.32
    2320  Single family indian housing......        0.00        9.51        9.12
    2320  Title I...........................       -1.44       -1.59       -1.50
                                               ---------   ---------  ----------
    2329    Weighted average subsidy rate...        0.00       -0.21       -0.22
        Guaranteed loan subsidy budget authority:
    2330  Subsidy budget authority..........         703          95          81
                                               ---------   ---------  ----------
    2339    Total subsidy budget authority..         703          95          81
        Guaranteed loan subsidy outlays:
    2340  Subsidy outlays...................         196         164         174
                                               ---------   ---------  ----------
    2349    Total subsidy outlays...........         196         164         174
    ----------------------------------------------------------------------------

        Administrative expense data:
    3510  Budget authority..................         202         207         222
    3590  Outlays from new authority........         202         207         222
    ---------------------------------------------------------------------------

        Multifamily Products.--This account includes budget authority for
    multifamily insurance programs requiring positive credit subsidies, as
    well as for salaries and expenses for all General and Special Risk
    Insurance Fund programs.

        The credit subsidy appropriation of $81 million requested for 1998
    will be used in conjunction with $71 million of carryover budget
    authority to provide a total program level of $152 million. The $222.3
    million requested in 1998 for administrative expenses includes $25
    million to support enhanced measures being undertaken to enforce
    standards for multifamily housing projects.

        Subsidy Costs and Administrative Expenses.--As required by the
    Federal Credit Reform Act of 1990, this account records, for the single
    family, multifamily and Title I insur-

    [[Page 559]]

    ance programs of FHA's General and Special Risk Insurance Funds, the
    subsidy costs associated with the loan guarantees committed or direct
    loans obligated in 1992 and thereafter (including modifications of loan
    guarantees or direct loans that resulted from obligations or commitments
    in any year), as well as administrative expenses of these programs. The
    subsidy amounts are estimated on a present value basis; the
    administrative expenses are accounted for on a cash basis.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0200-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    41.0  Direct obligations: Grants,
            subsidies, and contributions....         212         206         164
    99.0  Reimbursable obligations:
            Subtotal, reimbursable
            obligations.....................         202         207         222
                                               ---------   ---------  ----------
    99.9    Total obligations...............         414         413         386
    ---------------------------------------------------------------------------

         FHA--General and Special Risk Guaranteed Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4077-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Capital investment, claims and other:

    00.01   Default claims and other........         376         822       1,052
    00.03   Working capital fund
              reimbursements................           5           5           5
    00.04   Payment of negative subsidy to
              receipt account...............         142         119         122
    00.05   Interest paid to Treasury.......          31          42          82
    00.06   Downward subsidy rate reestimate         110
    00.08   Asset sale negative subsidy
              payment to receipt account....         534         414
    00.09   Asset sale payment to
              liquidating account...........       1,204         643
    00.10   Modification of pre-1992
              guarantees, costs.............          37          20          20
    00.11   Portfolio reengineering
              legislative savings...........                                 665
    00.12   Waiver of PD/mortgage sale law,
              savings.......................          40          80
                                               ---------   ---------  ----------
    10.00     Total obligations.............       2,479       2,145       1,946
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....         435         547         553
    22.00 New financing authority (gross)...       2,731       2,226       1,994
    22.60 Redemption of debt................        -140         -75        -135
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       3,026       2,698       2,412
    23.95 New obligations...................      -2,479      -2,145      -1,946
    24.90 Unobligated balance available, end
            of year: Fund balance...........         547         553         466
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    61.00 Transferred to other accounts.....        -100
    67.15 Authority to borrow (indefinite)..          86         166         760
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...       2,788       2,060       1,234
    68.10   Change in receivables from
              program account...............         -43
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................       2,745       2,060       1,234
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................       2,731       2,226       1,994
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

    72.40   Obligated balance: Appropriation          16          42          42
    72.95   Receivables from program account          43
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............          59          42          42
    73.10 New obligations...................       2,479       2,145       1,946
    73.20 Total financing disbursements
            (gross).........................      -2,496      -2,145      -1,946
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          42          42          42
    87.00 Total financing disbursements
            (gross).........................       2,496       2,145       1,946
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
              Federal sources:
    88.00       Payments from program
                  account...................        -172        -164        -174
    88.00       Modification subsidy,
                  program acct..............         -37         -20         -20
    88.00       Repayment of principal and
                  interest from liquidating
                  account...................        -137        -117        -117
    88.00       Repayment of portfolio
                  reengineering savings
                  borrowed..................                                 -67
    88.25     Interest on uninvested funds..         -35         -27         -23
              Non-Federal sources:
    88.40       Fees and premiums...........        -234        -379        -483
    88.40       Recoveries on defaulted
                  mortgages.................        -135        -276        -350
    88.40       Proceeds from sale of
                  mortgage notes............      -2,038      -1,077
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........      -2,788      -2,060      -1,234
    88.95 Change in receivables from program
            accounts........................          43
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............         -14         166         760
    90.00 Financing disbursements...........        -292          85         712
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4077-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........      17,400      17,400      17,400
    2112  Uncommitted loan guarantee
            limitation......................      -4,649
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................      12,751      17,400      17,400
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........      35,457      41,830      52,076
    2231  Disbursements of new guaranteed
            loans...........................      12,220      14,652      15,005
    2251  Repayments and prepayments........      -5,510      -3,646      -2,594
          Adjustments:

    2261    Terminations for default that
              result in loans receivable....         -90        -399        -552
    2262    Terminations for default that
              result in acquisition of
              property......................        -247        -251        -295
    2263    Terminations for default that
              result in claim payments......                    -110        -125
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........      41,830      52,076      63,515
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..      41,830      52,076      63,515
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......          88         159         539
    2331    Disbursements for guaranteed
              loan claims...................          90         399         552
    2351    Repayments of loans receivable..          -9         -19         -25
    2361    Write-offs of loans receivable..         -10
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......         159         539       1,066
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from loan guarantees committed in 1992 and thereafter
    (including modifications of loan guarantees that resulted from
    commitments in any year) for FHA's General and Special Risk Insurance
    Fund programs. The amounts in this account are a means of financing and
    are not included in the budget totals.

                               Balance Sheet (in millions of dollars) \1\

    -----------------------------------------------------------------------------------------------
    Identification code   86-4077-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....         451            589           504            152
            Investments in US securities:
    1107      Borrowings receivable from
                liquidating account.........         476            336           299            780
          Net value of assets related to
              post-1991 acquired defaulted
              guaranteed loans receivable:

    1501    Defaulted guaranteed loans
              receivable, gross.............          87            159           539          1,066
    1504    Foreclosed property.............          69            118           153            271
    1505    Allowance for subsidy cost......         -77           -164          -437           -850
                                            ------------ --------------  ------------  -------------

    [[Page 560]]

    1599      Net value of assets related to
                defaulted guaranteed loan...          79            113           255            487
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       1,006          1,038         1,058          1,419
        LIABILITIES:
    2103  Federal liabilities: Debt.........         476            421           385            533
    2204  Non-Federal liabilities:
            Liabilities for loan guarantees.         530            617           673            886
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       1,006          1,038         1,058          1,419
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       1,006          1,038         1,058          1,419
    -----------------------------------------------------------------------------------------------
        \1\ Preliminary results pending final audit. Subsidy reestimates for
    fiscal year 1996 disbursements will be performed for the Mid-Session
    review of the Budget.

           FHA--General and Special Risk Direct Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4105-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loans......................                      40         120
    00.02 Interest paid to Treasury.........                       3          10
                                               ---------   ---------  ----------
    10.00   Total obligations...............                      43         130
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................                                   2
    22.00 New financing authority (gross)...                      45         142
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......                      45         144
    23.95 New obligations...................                     -43        -130
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....                       2          14
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    67.15 Authority to borrow (indefinite)..                      40         120
    68.00 Spending authority from offsetting
            collections: Offsetting
            collections (cash)..............                       5          22
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................                      45         142
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................                      43         130
    73.20 Total financing disbursements
            (gross).........................                     -43        -130
    87.00 Total financing disbursements
            (gross).........................                      43         130
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

    88.40   Offsetting collections (cash)
              from: Interest received on
              loans.........................                      -5         -22
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............                      40         120
    90.00 Financing disbursements...........                      38         108
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4105-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on obligations:
    1111  Limitation on direct loans........         120         120         120
    1112  Unobligated direct loan limitation        -120         -80
                                               ---------   ---------  ----------
    1150    Total direct loan obligations...                      40         120
    ----------------------------------------------------------------------------

        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........                                  40
    1231  Disbursements: Direct loan
            disbursements...................                      40         120
    1251  Repayments: Repayments and
            prepayments.....................                                 -20
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........                      40         140
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from direct loans obligated in 1992 and thereafter (including
    loan modifications) for FHA's General and Special Risk Insurance Fund
    programs. The amounts in this account are a means of financing and are
    not included in the budget totals.

        This schedule includes two direct loan programs. One provides bridge
    loan financing to facilitate the disposition of multifamily housing
    owned by the Department to non-profit organizations who agree to
    preserve it as affordable rental or cooperative housing. The second is a
    single-family direct loan program for purchase money mortgages, as
    discussed in the preceding section for the Mutual Mortgage Insurance
    Fund.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4105-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Net value of assets related to
              post-1991 direct loans
              receivable:

    1401    Direct loans receivable, gross..                                       40            140
                                            ------------ --------------  ------------  -------------
    1499      Net present value of assets
                related to direct loans.....                                       40            140
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................                                       40            140
        LIABILITIES:
    2103  Federal liabilities: Treasury
            borrowing.......................                                       40            140
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............                                       40            140
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position                                       40            140
    -----------------------------------------------------------------------------------------------

              FHA--Loan Guarantee Recovery Fund--Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4106-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....                                   4
    22.00 New financing authority (gross)...                       4           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......                       4           5
    24.90 Unobligated balance available, end
            of year: Fund balance...........                       4           5
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............                       4           1
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

    88.00   Offsetting collections (cash)
              from: Federal sources.........                      -4          -1
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............
    90.00 Financing disbursements...........                      -4          -1
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4106-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........                      10
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................                      10
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........                                   7
    2231  Disbursements of new guaranteed
            loans...........................                       7           3
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........                       7          10
    ----------------------------------------------------------------------------

    [[Page 561]]

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..                       7          10
    ---------------------------------------------------------------------------

        Section 4 of the Church Arson Prevention Act of 1996 (P.L. 104-155),
    entitled ``Loan Guarantee Recovery Fund,'' authorizes the Secretary of
    Housing and Urban Development to guarantee loans made by financial
    institutions to assist certain nonprofit organizations that have been
    damaged as a result of acts of arson or terrorism.

        FHA--General and Special Risk Insurance Funds Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4072-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Operating expenses:

    00.02   Interest on debentures..........          18          19          20
    00.03   Other operating costs...........          41         148         148
    00.04   Working capital fund
              reimbursements................          13          15          15
    00.05   Legislative savings repayments..         138         117         117
                                               ---------   ---------  ----------
    00.91     Total operating expenses......         210         299         300
          Capital investment: Claims and other:

    01.01   Acquisition of defaulted Title I
              notes.........................          36          36          36
    01.02   Assignment of defaulted
              mortgages.....................         210         372       1,152
    01.03   Acquisition of real properties..         299         112          89
    01.04   Rehabilitation of real
              properties....................                     236         140
    01.06   Assignment of current mortgages.                       1           1
    01.07   Capitalized property expenses...         182          97         117
    01.08   Loss on defaulted guaranteed
              loans.........................          23          66         287
    01.10   Tax advances on held mortgages..          70          70          70
    01.11   Claims, other...................                      17          13
                                               ---------   ---------  ----------
    01.91     Total capital investment......         820       1,007       1,905
                                               ---------   ---------  ----------
    10.00   Total obligations...............       1,030       1,306       2,205
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

    21.40   Uninvested balance..............       1,637       1,818       2,143
    21.91   U.S. Securities: Par value......           5           7           7
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............       1,642       1,825       2,150
    22.00 New budget authority (gross)......       2,134       1,697         775
    22.10 Resources available from
            recoveries of prior year
            obligations.....................          18
    22.60 Redemption of debt................         -70         -66         -66
    22.70 Balance of permanent authority
            withdrawn.......................        -869
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       2,855       3,456       2,859
    23.95 New obligations...................      -1,030      -1,306      -2,205
          Unobligated balance available, end of year:

    24.40   Uninvested balance..............       1,818       2,143         647
    24.91   U.S. Securities: Par value......           7           7           7
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................       1,825       2,150         654
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    62.00 Transferred from other accounts...         100
    67.15 Authority to borrow (indefinite)..          66          66          66
    68.00 Spending authority from offsetting
            collections: Offsetting
            collections (cash)..............       1,968       1,631         709
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................       2,134       1,697         775
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Net obligated
            balance: Fund balance...........         366         278         278
    73.10 New obligations...................       1,030       1,306       2,205
    73.20 Total outlays (gross).............      -1,096      -1,306      -2,205
    73.31 Obligated balance transferred to
            other accounts..................          -4
    73.45 Adjustments in unexpired accounts.         -18
    74.90 Unpaid obligations, end of year:
            Obligated balance: Obligated
            balance.........................         278         278         278
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................         731          66         757
    86.98 Outlays from permanent balances...         365       1,240       1,448
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........       1,096       1,306       2,205
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
              Non-Federal sources:
    88.40       Fees and premiums...........        -245        -219        -205
    88.40       Rebates of insurance
                  premiums..................           8           8           8
    88.40       Multifamily foreclosure
                  sales.....................                     -42         -96
    88.40       Proceeds from sale of real
                  property..................        -261        -128        -132
    88.40       Proceeds from sale of
                  mortgage notes............      -1,204        -643
    88.40       Mortgage sale accounting
                  adjustment................         323        -323
    88.40       Prior year adjustment.......          -5
    88.40       Recoveries on defaulted
                  mortgages.................        -284         -14         -14
    88.40       Interest and operating
                  income....................        -210        -221        -225
    88.40       Recoveries on defaulted
                  Title I mortgages.........         -19         -17         -14
    88.40       Other interest, dividends
                  and revenue...............         -34         -12         -11
    88.40       Modification subsidy........         -37         -20         -20
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........      -1,968      -1,631        -709
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         166          66          66
    90.00 Outlays...........................        -872        -325       1,496
    ---------------------------------------------------------------------------

                     Summary of Budget Authority and Outlays

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Enacted/requested:
      Budget Authority..................         166          66          66
      Outlays...........................        -872        -325       1,496
    Legislative proposal, not subject to
        PAYGO:
      Budget Authority..................                                 523
      Outlays...........................                                 523
                                        ------------------------------------
    Total:
      Budget Authority..................         166          66         589
      Outlays...........................        -872        -325       2,019
                                        ====================================

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4072-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........         107          97          85
    1251  Repayments: Repayments and
            prepayments.....................          -8          -9          -7
    1264  Write-offs for default: Other
            adjustments, net................          -2          -3          -2
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........          97          85          76
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4072-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........      53,756      49,346      46,247
    2251  Repayments and prepayments........      -3,843      -2,531      -1,387
          Adjustments:

    2261    Terminations for default that
              result in loans receivable....        -246        -408      -1,188
    2262    Terminations for default that
              result in acquisition of
              property......................        -298        -112         -89
    2263    Terminations for default that
              result in claim payments......         -23         -48        -287
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........      49,346      46,247      43,296
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..      49,346      46,247      43,296
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......       5,234       2,933       1,801
    2331    Disbursements for guaranteed
              loan claims...................         246         408       1,188
    2351    Repayments of loans receivable..        -395        -142        -313
    2361    Write-offs of loans receivable..      -1,271        -755        -152
    2364    Other adjustments, net..........        -881        -643
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......       2,933       1,801       2,524
    ---------------------------------------------------------------------------

        The General insurance fund provides for a large number of
    specialized mortgage insurance programs, including the insurance of
    loans for property improvements as well as for cooperatives,
    condominiums, housing for the elderly, rental housing and nonprofit
    hospitals.

    [[Page 562]]

        The Special risk insurance fund provides mortgage insurance on
    behalf of mortgagors eligible for interest reduction payments who
    otherwise would not be eligible for mortgage insurance. In addition, the
    fund provides insurance on mortgages covering experimental housing where
    strict adherence to State or local building regulations was not
    observed. Insurance is also provided for high-risk mortgagors who
    normally would not be eligible for mortgage insurance.

        Budget program.--As required by the Federal Credit Reform Act of
    1990, this account records, for this program, all cash flows to and from
    the Government resulting from loan guarantees committed and direct loans
    obligated prior to 1992. This account is shown on a cash basis. New
    insurance and direct loan activity in 1992 and thereafter in the GI/SRI
    programs is recorded in corresponding program (86-0200) and financing
    (86-4077 and 86-4105) accounts.

        The program activities in the ``Program Highlights'' table shown
    below reflect the consolidated activity of the GI/SRI accounts.

                               PROGRAM HIGHLIGHTS

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Insurance commitments:
      Mortgage insurance applications
        (units).........................     300,794     402,018     434,744
                                        ====================================
    Mortgage and loan insurance written:
      Units.............................     301,730     370,341     407,501
      Amount............................      12,220      14,602      14,988
                                        ====================================
    Insurance maintenance: Outstanding
        balance of insurance in force,
        end of year:
      Mortgage insurance................      95,386     103,367     110,878
                                        ====================================

        Financial Condition.--The following tables reflect the revenues,
    expenses, and financial condition of the GI/SRI Liquidating Account
    based on Generally Accepted Accounting Principles.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4072-0-3-371   1995 actual
                                                     \1\   1996 actual
                                                                    \2\     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................         517            370           359            322
    0102  Expense...........................        -563           -167          -271         -1,821
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............         -46            203            88         -1,499
    -----------------------------------------------------------------------------------------------
        \1\ As reflected in the 1997 Budget.
        \2\ Preliminary results pending final audit.
                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4072-0-3-371   1995 actual
                                                     \1\    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....       1,134          2,092         2,392            871
            Investments in US securities:
    1102      Treasury securities, par......           5              7             7              7
    1106      Receivables, net..............           3             16            16             16
    1107      Advances and prepayments......          20
          Non-Federal assets:

    1206    Receivables, net................          98            175           175            175
    1207    Advances and prepayments........          75
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............         107             97            85             76
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................         -22            -21           -18            -16
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................          85             76            67             60
    1701    Defaulted guaranteed loans,
              gross.........................       5,201          2,940         1,801          2,523
    1703    Allowance for estimated
              uncollectible loans and
              interest (-)..................      -2,460         -1,957        -1,198         -1,678
    1704    Defaulted guaranteed loans and
              interest receivable, net......       2,741            983           603            845
    1705    Allowance for uncollectables
              from foreclosed property......        -543           -479          -293           -371
    1706    Foreclosed property.............         734            632           387            490
                                            ------------ --------------  ------------  -------------
    1799      Value of assets related to
                loan guarantees.............       2,932          1,136           697            964
    1901  Other Federal assets: Other assets          38                          236
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       4,390          3,502         3,590          2,093
        LIABILITIES:
          Federal liabilities:

    2101    Accounts payable................          63            373           373            373
    2102    Interest payable................           6
    2104    Resources payable to Treasury...          86
          Non-Federal liabilities:

    2201    Accounts payable................         131            131           131            131
    2202    Interest payable................          21
    2203    Debt............................         408             82            82             82
    2206    Pension and other actuarial
              liabilities...................       9,997          8,890         8,890          8,890
            Other:
    2207      Unearned revenue and advances.         380            111           111            111
    2207      Other.........................          50            209           209            209
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............      11,142          9,796         9,796          9,796
        NET POSITION:
    3100  Appropriated capital..............       6,287          5,350         5,350          5,350
    3300  Cumulative results of operations..     -20,510        -19,115       -19,026        -20,525
    3600  Debt Forgiveness..................       7,471          7,471         7,471          7,471
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............      -6,752         -6,294        -6,205         -7,704
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       4,390          3,502         3,591          2,092
    -----------------------------------------------------------------------------------------------
        \1\ As reflected in 1997 Budget.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4072-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................          55         164         164
    32.0  Land and structures...............         299         348         229
    33.0  Investments and loans.............         246         426       1,433
    42.0  Insurance claims and indemnities..         275         233         244
    43.0  Interest and dividends............          18          18          18
    44.0  Repayments to financing account...         137         117         117
                                               ---------   ---------  ----------
    99.9    Total obligations...............       1,030       1,306       2,205
    ---------------------------------------------------------------------------

        FHA--General and Special Risk Insurance Funds Liquidating Account

                  (Legislative proposal, not subject to PAYGO)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4072-2-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Capital investment: Claims and other:

    01.01   Change to baseline claims.......                                 449
    01.02   Change to repair and holding
              costs.........................                                 -19
    01.03   Legislative savings repayments..                                  67
                                               ---------   ---------  ----------
    01.91     Total capital investment......                                 497
                                               ---------   ---------  ----------
    10.00   Total obligations...............                                 497
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......                                 497
    23.95 New obligations...................                                -497
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    60.05 Appropriation (indefinite)........                                 523
    68.00 Spending authority from offsetting
            collections: Change to
            offsetting collections (cash)...                                 -26
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................                                 497
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................                                 497
    73.20 Total outlays (gross).............                                -497
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................                                 497
    ----------------------------------------------------------------------------

    [[Page 563]]

        Offsets:
          Against gross budget authority and outlays:

    88.40   Offsetting collections (cash)
              from: Change to recoveries on
              defaults......................                                  26
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................                                 523
    90.00 Outlays...........................                                 523
    ---------------------------------------------------------------------------

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4072-2-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    32.0  Land and structures...............                                 -19
    33.0  Investments and loans.............                                 449
    44.0  Repayment to financing account....                                  67
                                               ---------   ---------  ----------
    99.9    Total obligations...............                                 497
    ---------------------------------------------------------------------------

         Housing for the Elderly or Handicapped Fund Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4115-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Capital investment:

    00.01   Housing for the elderly or
              handicapped loans.............           3          14
    00.02   Maintenance security and
              collateral....................           2           4           4
                                               ---------   ---------  ----------
    00.91     Capital Investment, Subtotal..           5          18           4
    01.01 Operating expenses: Interest on
            borrowings......................         572         435         361
                                               ---------   ---------  ----------
    10.00   Total obligations...............         577         453         365
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....         315         462         760
    22.00 New budget authority (gross)......         722         751         751
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           2
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       1,039       1,213       1,511
    23.95 New obligations...................        -577        -453        -365
    24.90 Unobligated balance available, end
            of year: Fund balance...........         462         760       1,146
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    60.05 Appropriation (indefinite)........         805         735         881
    60.47 Portion applied to debt reduction.        -805        -735        -881
                                               ---------   ---------  ----------
    63.00   Appropriation (total)...........
    68.00 Spending authority from offsetting
            collections: Offsetting
            collections (cash)..............         722         751         751
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         722         751         751
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.90 Unpaid obligations, start of year:
            Obligated balance: Fund balance.         390         425         251
    73.10 New obligations...................         577         453         365
    73.20 Total outlays (gross).............        -540        -627        -439
    73.45 Adjustments in unexpired accounts.          -2
    74.90 Unpaid obligations, end of year:
            Obligated balance: Fund balance.         425         251         176
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................         540         627         439
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.40   Offsetting collections (cash)
              from: Non-Federal sources.....        -722        -751        -751
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................        -182        -124        -311
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4115-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........       8,331       8,306       8,424
    1231  Disbursements: Direct loan
            disbursements...................           2         189
    1251  Repayments: Repayments and
            prepayments.....................         -71         -71         -72
    1264  Write-offs for default: Other
            adjustments, net................          44
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........       8,306       8,424       8,352
    ---------------------------------------------------------------------------
        Note.--Amounts for direct loan obligations reflect reservations of
    section 202 funds. Loan obligations shown under the program and
    financing schedule reflect loans that have reached the initial closing
    stage of processing.

        The Housing for the Elderly or Handicapped Fund was established
    pursuant to section 202 of the Housing Act of 1959, as amended. The fund
    provided direct loans to nonprofit organizations building and managing
    housing projects for lower income persons who are elderly or disabled.

        Projects must include an assured range of necessary services for the
    occupants of such projects. In addition, the section 8 lower income
    housing assistance payments program has been used in conjunction with
    the section 202 program. Applications under the two programs have been
    processed simultaneously.

        The data included in these schedules represent direct loan
    activities funded under the Housing for the Elderly or Handicapped Loan
    Fund. Further, activities in support of the needs of the elderly and
    disabled have been carried out under a grant program funded in the 1991
    Appropriations Act (P.L. 101-507) and authorized in the National
    Affordable Housing Act (P.L. 101-625).

        After April 1, 1992, all projects for which there were
    administrative reservations converted to the capital advance assistance
    program.

        For FY 1998, funding is being requested for assistance on behalf of
    the elderly and disabled under the Housing for Special Populations
    Account.

        The program and financing schedule for this account summarizes the
    Federal government's obligations for this loan program. The amounts
    reflected in the following summary of administrative commitments reflect
    outstanding section 202 fund reservations, whereas, the obligations
    portion of the program and financing schedule reflects commitments which
    have reached the initial loan closing stage of processing.

                      SUMMARY OF ADMINISTRATIVE COMMITMENTS

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Program by activities:
      Capital investment:
        Administrative commitments,
          start of year.................          17          14
        Recovery of prior year
          obligations...................           4
        Administrative commitments, end
          of year.......................         -14
                                        ------------------------------------
          Subtotal, capital investment-
            loan obligations............           3          14
        Other expenses (Fee inspection).
      Capital investment:
        Loan obligations................           3          14
      Maintenance security and
        collateral......................           2           4           4
                                        ------------------------------------
          Total capital investment......           5          18           4
                                        ====================================

        Financing.--Repayments and interest income from loans continue to be
    available to pay for commitments of the fund.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4115-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................         672            700           680            679
    0102  Expense...........................        -551           -573          -439           -364
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............         121            127           241            315
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4115-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................         705            887         1,011          1,322
    1206  Non-Federal assets: Receivables,
            net.............................         167             83

    [[Page 564]]

          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............       8,331          8,306         8,424          8,353
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................         -18            -20           -20            -20
    1604    Direct loans and interest
              receivable, net...............       8,313          8,286         8,404          8,333
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................       8,313          8,286         8,404          8,333
    1901  Other Federal assets: Other assets          -7              1
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       9,178          9,257         9,415          9,655
        LIABILITIES:
          Federal liabilities:

    2102    Interest payable................         275            291           222            184
    2104    Resources payable to Treasury...         142              8             8              8
    2207  Non-Federal liabilities: Other....       7,714          6,909         6,174          5,293
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       8,131          7,208         6,404          5,485
        NET POSITION:
    3100  Appropriated capital..............       1,183          2,021         2,756          3,637
    3300  Cumulative results of operations..        -137             28           256            534
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............       1,046          2,049         3,011          4,170
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       9,177          9,257         9,416          9,656
    -----------------------------------------------------------------------------------------------

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4115-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    32.0  Land and structures...............           2           4           4
    33.0  Investments and loans.............           3          14
    43.0  Interest and dividends............         572         435         361
                                               ---------   ---------  ----------
    99.9    Total obligations...............         577         453         365
    ---------------------------------------------------------------------------

                Nonprofit Sponsor Assistance Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4042-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....           6           6           6
    23.95 New obligations...................
    24.90 Unobligated balance available, end
            of year: Fund balance...........           6           6           6
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4042-0-3-604      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........           1           1           1
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........           1           1           1
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for this program, all cash flows to and from the Government
    resulting from direct loans obligated prior to 1992. This account is
    shown on a cash basis.

        The Nonprofit Sponsor Assistance fund provided interest-free loans
    to nonprofit organizations to plan housing projects to be financed under
    the section 202 housing for the elderly or disabled program.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4042-0-3-604    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................           6              6             6              6
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............           1              1             1              1
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................          -1             -1            -1             -1
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................           6              6             6              6
        NET POSITION:
    3300  Cumulative results of operations..           6              6             6              6
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............           6              6             6              6
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position           6              6             6              6
    -----------------------------------------------------------------------------------------------

                    GOVERNMENT NATIONAL MORTGAGE ASSOCIATION

                                  Federal Funds

        The Housing and Urban Development Act of 1968 authorized the
    Government National Mortgage Association (Ginnie Mae) to guarantee the
    timely payment of principal and interest on privately issued securities
    that are backed by pools of FHA, Veterans Affairs (VA) and Rural Housing
    Service mortgages. The Ginnie Mae guarantee gives lenders access to the
    capital markets for funds to originate new loans. New FHA and VA loans
    are currently pooled into Ginnie Mae securities.

        Financing.--Ginnie Mae issuers are assessed commitment, guarantee
    and other fees to cover costs incurred by Ginnie Mae and to fund a
    reserve against possible future payments under the guarantee.

        Operating results.--Fee collections, interest, and other income are
    expected to exceed expenses by $23 million and $60 million in 1997 and
    1998 respectively.

                    Management and Liquidating Functions Fund

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4016-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.91 Unobligated balance available,
            start of year: U.S. Securities:
            Par value.......................          15
    22.40 Capital transfer to general fund..         -15
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......
    23.95 New obligations...................
    24.91 Unobligated balance available, end
            of year: U.S. Securities: Par
            value...........................
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................
    86.98 Outlays from permanent balances...
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................
    ---------------------------------------------------------------------------

        Budget program.--The remaining $15 million portfolio in the
    Management and Liquidating Functions Fund was redeemed at par value plus
    accrued interest on January 1, 1996, on which date interest ceased.
    Debentures and interest earned of $15.4 million was transferred to the
    Treasury Department.

    [[Page 565]]

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4016-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................           1
    0102  Expense...........................
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............           1
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4016-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Investments in US securities:

    1104    Federal assets: Agency
              securities, par...............          15
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................          15
        NET POSITION:
    3300  Cumulative results of operations..          15
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............          15
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position          15
    -----------------------------------------------------------------------------------------------

    Credit accounts:

     Guarantees of Mortgage-Backed Securities Loan Guarantee Program Account

                          (includes transfer of funds)

        During fiscal year [1997] 1998, new commitments to issue guarantees
    to carry out the purposes of section 306 of the National Housing Act, as
    amended (12 U.S.C. 1721(g)), shall not exceed [$110,000,000,000]
    $130,000,000,000.
        For administrative expenses necessary to carry out the guaranteed
    mortgage-backed securities program, $9,383,000, to be derived from the
    Ginnie Mae-guarantees of mortgage-backed securities guaranteed loan
    receipt account, of which not to exceed $9,383,000 shall be transferred
    to the appropriation for salaries and expenses.
        [During fiscal year 1996 and in addition to commitments previously
    provided, additional commitments to issue guarantees to carry out
    section 306 of the National Housing Act, as amended (12 U.S.C. 1721(g)),
    shall not exceed $20,000,000,000.] (Departments of Veterans Affairs and
    Housing and Urban Development, and Independent Agencies Appropriations
    Act, 1997.)

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0186-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, start of year............
        Receipts:
    02.01 Guarantees of mortgage backed
            securities guarantee loans,
            negative subsidies..............           9           9          81
        Appropriation:
    05.01 Guarantees of mortgage-backed
            securities loan guarantee
            program account.................          -9          -9          -9
    07.99 Total balance, end of year........                                  72
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0186-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations (object class
            25.2)...........................           9           9           9
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......           9           9           9
    23.95 New obligations...................          -9          -9          -9
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.25 Appropriation (special fund,
            indefinite).....................           9           9           9
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................           9           9           9
    73.20 Total outlays (gross).............          -9          -9          -9
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority           9           9           9
    86.93 Outlays from current balances.....
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........           9           9           9
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................           9           9           9
    90.00 Outlays...........................           9           9           9
    ---------------------------------------------------------------------------

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0186-0-1-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2159  Total loan guarantee levels.......     130,000     110,000     130,000
        Guaranteed loan subsidy (in percent):
    2320  Subsidy rate......................        0.00        0.00       -0.32
        Guaranteed loan subsidy budget authority:
    2339  Total subsidy budget authority....          -9          -9          -9
        Guaranteed loan subsidy outlays:
    2349  Total subsidy outlays.............          -9          -9          -9
    ---------------------------------------------------------------------------

        The schedule above reflects new methodology under credit reform for
    GNMA. During transition to the new methodology, negative subsidy will
    not match disbursement from the GNMA financing account to the GNMA
    receipt account.

        As required by the Federal Credit Reform Act of 1990, this account
    records the administrative expenses of this program. The administrative
    expenses are estimated on a cash basis.

           Guarantees of Mortgage-Backed Securities Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4240-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Payment to receipt account for
            administration..................           9           9           9
    00.02 Payment to receipt account for
            negative subsidy................                                  45
    00.03 Payment to receipt account for
            multi-class savings proposals...                                  27
    00.04 Operating expenses................                                  15
    00.05 Capital investment................                                   6
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              25.2).........................           9           9         102
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....          99         127         150
    22.00 New financing authority (gross)...          37          32         102
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         136         159         252
    23.95 New obligations...................          -9          -9        -102
    24.90 Unobligated balance available, end
            of year: Fund balance...........         127         150         150
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............          37          32         102
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.47 Unpaid obligations, start of year:
            Obligated balance: Authority to
            borrow..........................          -6
    73.10 New obligations...................           9           9         102
    73.20 Total financing disbursements
            (gross).........................          -3          -9        -102
    74.47 Unpaid obligations, end of year:
            Obligated balance: Authority to
            borrow..........................
    87.00 Total financing disbursements
            (gross).........................           3           9         102
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
    88.25     Interest on uninvested funds..          -8          -2          -2
    88.40     Non-Federal sources:
                Commitment and other fees...         -29         -30        -100
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........         -37         -32        -102
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............

    [[Page 566]]

    90.00 Financing disbursements...........         -35         -23
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4240-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........
    1232  Disbursements: Purchase of loans
            assets from the public..........                                   5
    1252  Repayments: Proceeds from loan
            asset sales to the public or
            discounted......................                                  -5
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4240-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........     130,000     110,000     130,000
    2112  Uncommitted loan guarantee
            limitation......................     -20,000
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................     110,000     110,000     130,000
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........
    2231  Disbursements of new guaranteed
            loans...........................                              75,799
    2251  Repayments and prepayments........
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........                              75,799
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..
    ---------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4240-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................          93            127           137            149
    1206  Non-Federal assets: Receivables,
            net.............................           6                                         105
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................          99            127           137            254
        NET POSITION:
    3300  Cumulative results of operations..          99            127           137            254
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............          99            127           137            254
    -----------------------------------------------------------------------------------------------
        Note.--GNMA guarantees the timely payment of principal and interest
    installments on securities which are backed by FHA-insured, FmHA-
    insured, and VA-guaranteed mortgages. Such guarantees are excluded from
    the Government total of guaranteed obligations duplicating FHA, FmHA,
    and VA guarantees.

          Guarantees of Mortgage-Backed Securities Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4238-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Operating expenses:

    00.02   Functional services.............          12          13          13
    00.03   Default expenses................           8           9           8
    00.04   Servicing expenses..............           9          10          10
    00.05   Other expenses..................          15          20          19
    00.06   REMIC expenses..................           4           5           6
                                               ---------   ---------  ----------
    00.91     Total operating expenses......          48          57          56
          Capital investment:

    01.01   Advances of guaranty payments...         129         145         111
    01.02   Real estate owned properties....          13          13          12
                                               ---------   ---------  ----------
    01.91     Total capital investment......         142         158         123
                                               ---------   ---------  ----------
    10.00   Total obligations...............         190         215         179
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

    21.90   Treasury balance................          87          82          52
            U.S. Securities:
              Par value:
    21.91       Par value...................       4,211       4,762       5,341
    21.91       Par value (REMICs)..........         -17
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............       4,281       4,844       5,393
    22.00 New budget authority (gross)......         753         765         735
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       5,034       5,609       6,128
    23.95 New obligations...................        -190        -215        -179
          Unobligated balance available, end of year:

    24.90   Fund balance....................          82          52          45
    24.91   U.S. Securities: Par value......       4,762       5,341       5,903
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................       4,844       5,393       5,948
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Spending authority from offsetting
              collections:

            Offsetting collections (cash):
    68.00     Offsetting collections (cash).         742         743         714
    68.00     Spending authority from
                offsetting collections
                (REMICs)....................          11          22          21
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................         753         765         735
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         753         765         735
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.47 Unpaid obligations, start of year:
            Obligated balance: Orders on
            hand from Federal sources.......         -87         -78         -48
    73.10 New obligations...................         190         215         179
    73.20 Total outlays (gross).............        -181        -185        -173
    74.47 Unpaid obligations, end of year:
            Obligated balance: Orders on
            hand from Federal Sources.......         -78         -48         -41
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.98 Outlays from permanent balances...         181         185         173
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
    88.20     Interest on U.S. securities...        -264        -261        -277
              Non-Federal sources:
    88.40       Guarantee fees..............        -305        -311        -297
    88.40       Repayments of guaranteed
                  payments..................        -120        -130        -102
    88.40       Commitment and other fees...         -17         -28         -27
    88.40       Servicing income............         -16         -16         -15
    88.40       Receipts from sale of REO
                  properties and mobile home
                  units.....................         -11         -11         -10
    88.40       Repayments on mortgages.....         -12
    88.40       Sale of servicing rights....          -8          -8          -7
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........        -753        -765        -735
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................        -571        -580        -562
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4238-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........         333         321         327
    1232  Disbursements: Purchase of loans
            assets from the public..........         128         144         111
    1252  Repayments: Proceeds from loan
            asset sales to the public or
            discounted......................        -140        -138        -109
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........         321         327         329
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4238-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........     463,848     497,433     533,333

    [[Page 567]]

    2231  Disbursements of new guaranteed
            loans...........................     101,540      79,560
    2251  Repayments and prepayments........     -67,955     -43,660     -45,465
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........     497,433     533,333     487,868
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..     497,433     503,333     487,868
    ---------------------------------------------------------------------------

        Budget Program.--Program activity is summarized below:

                           Mortgage-backed Securities

                            [In millions of dollars]

                                         1996 actual  1997 est.   1998 est.
    Commitment limitation...............     130,000     110,000           *
    Commitments issued..................     110,000     110,000           *
    Guarantees issued...................     101,540      79,560           *
    Securities outstanding..............     497,423     533,333           *

        * 1998 figures are reflected in the GNMA financing account.

        Operating results.--Fee collections, interest, and other income are
    expected to exceed expenses by $570 million in 1996 and $570 million in
    1997 and 1998, respectively. These amounts will be retained to cover
    future year expenses and as a reserve against losses that may be
    incurred on guarantees.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4238-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        Revenue:
    0101  Revenue...........................         514            576           602            602
    0101  Revenue (REMICs)..................          13             11            22             21
        Expense:
    0102  Expense...........................         -46            -96           -52            -51
    0102  Expense (REMICs)..................          -4             -4            -2             -2
        Net income or loss (-):
                                            ------------ --------------  ------------  -------------
    0109    Net income or loss (-)..........         468            480           550            551
                                            ------------ --------------  ------------  -------------
    0109    Net income or loss (-) (REMICs).           9              7            20             19
                                            ------------ --------------  ------------  -------------
    0199  Net income or loss................         477            487           570            570
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   86-4238-0-3-371    1995 actual    1996 actual     1997 est.      1998 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....                          4             4              4
            Investments in US securities:
    1102      Treasury securities, par......       4,232          4,785         5,341          5,903
    1104      Agency securities, par........           1
    1106      Receivables, net..............          59             60            60             64
    1206  Non-Federal assets: Receivables,
            net.............................          26             28            28             27
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............         333            321           327            329
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................        -241           -288          -163           -162
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................          92             33           164            167
    1801  Other Federal assets: Cash and
            other monetary assets...........           4              5             5              6
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       4,414          4,915         5,602          6,171
        LIABILITIES:
          Non-Federal liabilities:

    2201    Accounts payable................          29             36            45             53
    2207    Other...........................         534            473           471            471
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............         563            509           516            524
        NET POSITION:
    3300  Cumulative results of operations..       3,851          4,406         5,085          5,647
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............       3,851          4,406         5,085          5,647
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       4,414          4,915         5,601          6,171
    -----------------------------------------------------------------------------------------------
        Note.--Ginnie Mae guarantees the timely payment of principal and
    interest installments on securities which are backed by FHA-insured,
    FmHA-insured, and VA-guaranteed mortgages. Such guarantees are excluded
    from the Government total of guaranteed obligations duplicating FHA,
    FmHA, and VA guarantees.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4238-0-3-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................          48          57          56
    33.0  Investments and loans.............         142         158         123
    99.0  Subtotal, reimbursable obligations         190         215         179
                                               ---------   ---------  ----------
    99.9    Total obligations...............         190         215         179
    ---------------------------------------------------------------------------

                         POLICY DEVELOPMENT AND RESEARCH

                                  Federal Funds

    General and special funds:

                             Research and Technology

        For contracts, grants, and necessary expenses of programs of
    research and studies relating to housing and urban problems, not
    otherwise provided for, as authorized by title V of the Housing and
    Urban Development Act of 1970, as amended (12 U.S.C. 1701z-1 et seq.),
    including carrying out the functions of the Secretary under section
    1(a)(1)(i) of Reorganization Plan No. 2 of 1968, [$34,000,000]
    $39,000,000, to remain available until September 30, [1998] 1999.
    (Departments of Veterans Affairs and Housing and Urban Development, and
    Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0108-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct program....................          33          36          39
                                               ---------   ---------  ----------
    10.00   Total obligations...............          33          36          39
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           1           2
    22.00 New budget authority (gross)......          34          34          39
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          35          36
    23.95 New obligations...................         -33         -36         -39
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....           2
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................          34          34          39
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          28          25          29
    73.10 New obligations...................          33          36          39
    73.20 Total outlays (gross).............         -36         -32         -37
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          25          29          31
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority          14          14          16
    86.93 Outlays from current balances.....          22          18          21
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........          36          32          37
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          34          34          39
    90.00 Outlays...........................          36          32          37
    ---------------------------------------------------------------------------

        The Housing and Urban Development Act of 1970 directs the Secretary
    to undertake programs of research, studies, testing, and demonstrations
    related to the HUD mission. These functions are carried out internally
    and through contracts with industry, nonprofit research organizations,
    and educational institutions, and through agreements with State and
    local governments and other Federal agencies.

        In 1998, the research program will focus on activities to support
    the reinvention of HUD, including examination of issues such as the
    transformation of public housing and design of standards for
    performance-based funds. National housing surveys and research to reduce
    the cost of housing will continue in 1998.

    [[Page 568]]

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0108-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................          29          32          34
    41.0  Grants, subsidies, and
            contributions...................           4           4           5
                                               ---------   ---------  ----------
    99.9    Total obligations...............          33          36          39
    ---------------------------------------------------------------------------

                       FAIR HOUSING AND EQUAL OPPORTUNITY

                                  Federal Funds

    General and special funds:

                             Fair Housing Activities

        For contracts, grants, and other assistance, not otherwise provided
    for, as authorized by title VIII of the Civil Rights Act of 1968, as
    amended by the Fair Housing Amendments Act of 1988, and section 561 of
    the Housing and Community Development Act of 1987, as amended,
    [$30,000,000] $39,000,000, to remain available until September 30,
    [1998] 1999, of which [$15,000,000] $24,000,000 shall be to carry out
    activities pursuant to such section 561. [No funds made available under
    this heading shall be used to lobby the executive or legislative
    branches of the Federal Government in connection with a specific
    contract, grant or loan.] (Departments of Veterans Affairs and Housing
    and Urban Development, and Independent Agencies Appropriations Act,
    1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0144-0-1-751      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Fair housing assistance...........          11          19          15
    00.02 Fair housing initiatives..........           9          24          24
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              41.0).........................          20          43          39
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           3          13
    22.00 New budget authority (gross)......          30          30          39
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          33          43          39
    23.95 New obligations...................         -20         -43         -39
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....          13
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.00 Appropriation.....................          30          30          39
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          44          32          51
    73.10 New obligations...................          20          43          39
    73.20 Total outlays (gross).............         -32         -24         -27
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          32          51          63
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.93 Outlays from current balances.....          32          24          27
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          30          30          39
    90.00 Outlays...........................          32          24          27
    ---------------------------------------------------------------------------

        The Budget proposes an appropriation of $39 million in 1998 for fair
    housing activities to aid in eliminating housing discrimination. Of the
    amount requested, $15 million is for the Fair Housing Assistance program
    and $24 million is for the Fair Housing Initiatives program.

        The Fair Housing Assistance program, authorized by title VIII of the
    Civil Rights Act of 1968 as amended, provides funding to State and local
    agencies to assure prompt and effective processing of title VIII (Civil
    Rights Act of 1968) complaints.

        The Fair Housing Initiatives program, authorized by the Housing and
    Community Development Act of 1987, as amended by the Housing and
    Community Development Act of 1992, provides support to public and
    private organizations for the purpose of eliminating or preventing
    discrimination in housing and for enhancing fair housing opportunities.

                          MANAGEMENT AND ADMINISTRATION

                                  Federal Funds

    General and special funds:

                              Salaries and Expenses

                          (including transfer of funds)

        For necessary administrative and non-administrative expenses of the
    Department of Housing and Urban Development, not otherwise provided for,
    including not to exceed $7,000 for official reception and representation
    expenses, [$976,840,000, of which $15,000,000 may be used for additional
    retraining, relocation, permanent change of station, and other
    activities related to downsizing only upon submission of a detailed and
    specific, multi-year downsizing plan to the Committees on Appropriations
    of the House of Representatives and the Senate, and] [$955,471,000,]
    $1,005,826,000 of which $544,443,000 shall be provided from the various
    funds of the Federal Housing Administration, $9,383,000 shall be
    provided from funds of the Government National Mortgage Association, and
    [$675,000] $1,000,000 shall be provided from the Community Development
    Grants Program account. (Departments of Veterans Affairs and Housing and
    Urban Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0143-0-1-999      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
          Direct program:

    00.01   Housing, mortgage credit,
              regulatory and energy
              conservation..................          94          95         121
    00.02   Community planning and
              development programs..........          59          60          61
    00.03   Equal opportunity and research
              programs......................          59          59          60
    00.04   Departmental management, legal
              and audit services............          51          51          52
    00.05   Field direction and
              administration................         154         155         157
                                               ---------   ---------  ----------
    00.91     Total direct program..........         417         420         451
    01.01 Reimbursable program..............         546         557         555
                                               ---------   ---------  ----------
    10.00   Total obligations...............         963         977       1,006
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           1
    22.00 New budget authority (gross)......         965         977       1,006
    22.30 Unobligated balance expiring......          -4
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         962         977       1,006
    23.95 New obligations...................        -963        -977      -1,006
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................         420         420         451
    40.75   Reduction pursuant to P.L. 104-
              134...........................          -1
                                               ---------   ---------  ----------
    43.00     Appropriation (total).........         419         420         451
          Permanent:

    68.00   Spending authority from
              offsetting collections:
              Offsetting collections (cash).         546         557         555
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         965         977       1,006
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation         112         136         136
    73.10 New obligations...................         963         977       1,006
    73.20 Total outlays (gross).............        -928        -977        -998
    73.40 Adjustments in expired accounts...         -11                      -8
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation         136         136         136
    ----------------------------------------------------------------------------

    [[Page 569]]

        Outlays (gross), detail:
    86.90 Outlays from new current authority         321         324         347
    86.93 Outlays from current balances.....          61          96          96
    86.97 Outlays from new permanent
            authority.......................         546         557         555
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         928         977         998
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.00   Offsetting collections (cash)
              from: Federal sources.........        -546        -557        -555
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         419         420         451
    90.00 Outlays...........................         382         420         443
    ---------------------------------------------------------------------------

        This appropriation finances all salaries and related costs
    associated with administering the programs of the Department of Housing
    and Urban Development, including: housing and mortgage credit programs;
    community planning and development programs; equal opportunity,
    research, regulatory and insurance programs; departmental management,
    and legal services; and, field direction and administration.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0143-0-1-999      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

          Direct obligations:

            Personnel compensation:
    11.1      Full-time permanent...........         223         222         217
    11.3      Other than full-time permanent           4           4           4
    11.5      Other personnel compensation..           5           5           5
                                               ---------   ---------  ----------
    11.9        Total personnel compensation         232         231         226
    12.1    Civilian personnel benefits.....          49          49          47
    13.0    Benefits for former personnel...           1           1           1
    21.0    Travel and transportation of
              persons.......................           6           7          11
    22.0    Transportation of things........                       3           2
    23.1    Rental payments to GSA..........          32          33          34
    23.3    Communications, utilities, and
              miscellaneous charges.........          10          13          15
    24.0    Printing and reproduction.......           3           3           3
    25.1    Advisory and assistance services          13          10          25
    25.2    Other services..................           2           2           2
    25.3    Purchases of goods and services
              from Government accounts......          54          53          71
    25.4    Operation and maintenance of
              facilities....................           6           6           6
    25.7    Operation and maintenance of
              equipment.....................                       1
    26.0    Supplies and materials..........           3           3           3
    31.0    Equipment.......................           6           4           4
    42.0    Insurance claims and indemnities                       1           1
                                               ---------   ---------  ----------
    99.0      Subtotal, direct obligations..         417         420         451
    99.0  Reimbursable obligations..........         546         557         555
                                               ---------   ---------  ----------
    99.9    Total obligations...............         963         977       1,006
    ---------------------------------------------------------------------------

                                  Personnel Summary

    ----------------------------------------------------------------------------
    Identification code 86-0143-0-1-999      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Direct:
          Total compensable workyears:

    1001    Full-time equivalent employment.       4,565       4,491       4,443
    1005    Full-time equivalent of overtime
              and holiday hours.............          24          24          25
        Reimbursable:
          Total compensable workyears:

    2001    Full-time equivalent employment.       5,977       5,956       5,518
    2005    Full-time equivalent of overtime
              and holiday hours.............          32          32          31
    ---------------------------------------------------------------------------

                           Office of Inspector General

                          (including transfer of funds)

        For necessary expenses of the Office of Inspector General in
    carrying out [the provisions of] the Inspector General Act of 1978, as
    amended, [$52,850,000] $57,850,000, of which $11,283,000 shall be
    provided from the various funds of the Federal Housing Administration
    and [$5,000,000] $10,000,000 shall be provided from the amount earmarked
    for Operation Safe Home in the Drug Elimination Grants for Low Income
    Housing Account. (Departments of Veterans Affairs and Housing and Urban
    Development, and Independent Agencies Appropriations Act, 1997.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0189-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct program....................          36          37          37
    01.01 Reimbursable program..............          12          16          21
                                               ---------   ---------  ----------
    10.00   Total obligations...............          48          53          58
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New budget authority (gross)......          49          53          58
    23.95 New obligations...................         -48         -53         -58
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................          37          37          37
          Permanent:

    68.00   Spending authority from
              offsetting collections:
              Offsetting collections (cash).          12          16          21
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................          49          53          58
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation          10          18          18
    73.10 New obligations...................          48          53          58
    73.20 Total outlays (gross).............         -40         -53         -58
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation          18          18          18
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority          23          28          28
    86.93 Outlays from current balances.....           5           9           9
    86.97 Outlays from new permanent
            authority.......................          12          16          21
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........          40          53          58
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.00   Offsetting collections (cash)
              from: Federal sources.........         -12         -16         -21
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          37          37          37
    90.00 Outlays...........................          28          37          37
    ---------------------------------------------------------------------------

        This appropriation provides agency-wide audit and investigative
    functions to identify and correct management and administrative
    deficiencies that create conditions for existing or potential instances
    of fraud, waste and mismanagement. The audit function provides internal
    audit, contract audit, and inspection services. Contract audits provide
    professional advice to agency contracting officials on accounting and
    financial matters relative to negotiation, award, administration,
    repricing, and settlement of contracts. Internal audits review and
    evaluate all facets of agency operations. Inspection services provide
    detailed technical evaluations of agency operations. The investigative
    function provides for the detection and investigation of improper and
    illegal activities involving programs, personnel, and operations.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-0189-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

          Direct obligations:

            Personnel compensation:
    11.1      Full-time permanent...........          20          21          21
    11.5      Other personnel compensation..           2           2           2
                                               ---------   ---------  ----------
    11.9        Total personnel compensation          22          23          23
    12.1    Civilian personnel benefits.....           5           5           5
    21.0    Travel and transportation of
              persons.......................           2           3           3
    23.1    Rental payments to GSA..........           4           3           3
    25.1    Advisory and assistance services           1           1           1
    25.2    Other services..................                       1           1
    25.3    Purchases of goods and services
              from Government accounts......           1           1           1
    25.7    Operation and maintenance of
              equipment.....................           1
                                               ---------   ---------  ----------
    99.0      Subtotal, direct obligations..          36          37          37
    99.0  Reimbursable obligations..........          12          16          21
                                               ---------   ---------  ----------

    [[Page 570]]

    99.9    Total obligations...............          48          53          58
    ---------------------------------------------------------------------------

                                  Personnel Summary

    ----------------------------------------------------------------------------
    Identification code 86-0189-0-1-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Direct:
          Total compensable workyears:

    1001    Full-time equivalent employment.         372         376         367
    1005    Full-time equivalent of overtime
              and holiday hours.............           1           1           1
        Reimbursable:
    2001  Total compensable workyears: Full-
            time equivalent employment......         120         167         214
    ---------------------------------------------------------------------------

                 Office of Federal Housing Enterprise Oversight

                              salaries and expenses

        For carrying out the Federal Housing Enterprise Financial Safety and
    Soundness Act of 1992, [$15,500,000] including not to exceed $3,000 for
    official reception and representation expenses, $16,312,000, to remain
    available until expended, from the Federal Housing Enterprise Oversight
    Fund: Provided, That [such amounts shall be collected by the Director as
    authorized by section 1316(a) and (b) of such Act and deposited in the
    Fund under section 1316(f).] not to exceed such amount shall be
    available from the General Fund of the Treasury to the extent necessary
    to incur obligations and make expenditures pending the receipt of
    collections to the Fund: Provided further, That the General Fund amount
    shall be reduced as collections are received during the fiscal year so
    as to result in a final appropriation from the General Fund estimated at
    not more than $0. (Departments of Veterans Affairs and Housing and Urban
    Development, and Independent Agencies Appropriations Act, 1997.)

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5272-0-2-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, start of year............           2           2           2
        Receipts:
    02.01 Office of federal housing
            enterprise oversight............          13          16          16
                                               ---------   ---------  ----------
    04.00 Total: Balances and collections...          15          18          18
        Appropriation:
    05.01 Office of federal housing
            enterprise oversight............         -15         -16         -16
    07.99 Total balance, end of year........           2           2           2
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5272-0-2-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    10.00 Total obligations.................          15          16          16
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested
            balance.........................           2
    22.00 New budget authority (gross)......          15          16          16
    22.30 Unobligated balance expiring......          -2
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          15          16          16
    23.95 New obligations...................         -15         -16         -16
    24.40 Unobligated balance available, end
            of year: Uninvested balance.....
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    40.20 Appropriation (special fund,
            definite).......................          15          16          16
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Appropriation           6           7           6
    73.10 New obligations...................          15          16          16
    73.20 Total outlays (gross).............         -14         -16         -16
    74.40 Unpaid obligations, end of year:
            Obligated balance: Appropriation           7           6           6
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority          14          16          16
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................          15          16          16
    90.00 Outlays...........................          14          16          16
    ---------------------------------------------------------------------------

        This appropriation funds the Office of Federal Housing Enterprise
    Oversight (the Office), which was established in 1992 to regulate the
    financial safety and soundness of the two housing Government Sponsored
    Enterprises (GSEs)--the Federal National Mortgage Association and the
    Federal Home Loan Mortgage Corporation. The Office was authorized in the
    Federal Housing Enterprise Safety and Soundness Act of 1992, which also
    instituted a risk-based capital standard for the GSEs, and gave the
    regulator enhanced authority to enforce those standards. The office is
    also required by statute to conduct on-site annual examinations at the
    GSEs to determine the condition of each enterprise for the purpose of
    ensuring their financial safety and soundness.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-5272-0-2-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    11.1  Personnel compensation: Personnel
            Compensation....................           6           7           7
    12.1  Civilian personnel benefits.......           2           2           2
    23.1  Rental payments to GSA............           2           2           2
    25.2  Other services....................           5           5           5
                                               ---------   ---------  ----------
    99.9    Total obligations...............          15          16          16
    ---------------------------------------------------------------------------

                                  Personnel Summary

    ----------------------------------------------------------------------------
    Identification code 86-5272-0-2-371      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    1001  Total compensable workyears: Full-
            time equivalent employment......          66          78          78
    ---------------------------------------------------------------------------

    Intragovernmental funds:

                              Working Capital Fund

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4586-0-4-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Operating expenses: Data
            processing services.............         196         217         257
    00.03 Capital investment: Data
            processing services.............           2           2           2
                                               ---------   ---------  ----------
    10.00   Total obligations...............         198         219         259
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.90 Unobligated balance available,
            start of year: Fund balance.....          31          32          33
    22.00 New budget authority (gross)......         198         219         259
    22.10 Resources available from
            recoveries of prior year
            obligations.....................           1           1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         230         252         292
    23.95 New obligations...................        -198        -219        -259
    24.90 Unobligated balance available, end
            of year: Fund balance...........          32          33          33
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...         183         219         259
    68.10   Change in orders on hand from
              Federal sources...............          14
    68.15   Adjustment to orders on hand
              from Federal sources..........           1
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................         198         219         259
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         198         219         259
    ----------------------------------------------------------------------------

    [[Page 571]]

        Change in unpaid obligations:
          Unpaid obligations, start of year:

    72.90   Obligated balance: Fund balance.          -1          -3          -3
    72.95   Orders on hand from Federal
              sources.......................          10          24          24
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............           9          21          21
    73.10 New obligations...................         198         219         259
    73.20 Total outlays (gross).............        -185        -219        -259
    73.45 Adjustments in unexpired accounts.          -1          -1
          Unpaid obligations, end of year:

            Obligated balance:
    74.40     Appropriation.................
    74.90     Fund balance..................          -3          -3          -3
    74.95   Orders on hand from Federal
              sources.......................          24          24          24
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................          21          21          21
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................         185         219         259
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.00   Offsetting collections (cash)
              from: Federal sources.........        -183        -219        -259
    88.95 Change in orders on hand from
            Federal sources.................         -14
    88.96 Adjustment to orders on hand from
            Federal sources.................          -1
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................           2
    ---------------------------------------------------------------------------

        The Working Capital Fund, authorized by the Department of Housing
    and Urban Development Act of 1965, finances information technology and
    office automation initiatives which can be performed more efficiently on
    a centralized basis. The fund is financed from fees charged for services
    performed.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 86-4586-0-4-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    11.1  Personnel compensation: Full-time
            permanent.......................          18          18          19
    12.1  Civilian personnel benefits.......           3           4           4
    21.0  Travel and transportation of
            persons.........................           1           1           1
    23.3  Communications, utilities, and
            miscellaneous charges...........          45          53          50
    25.2  Other services....................          94         125         169
    26.0  Supplies and materials............           5           3           1
    31.0  Equipment.........................          32          15          15
                                               ---------   ---------  ----------
    99.9    Total obligations...............         198         219         259
    ---------------------------------------------------------------------------

                                  Personnel Summary

    ----------------------------------------------------------------------------
    Identification code 86-4586-0-4-451      1996 actual   1997 est.   1998 est.
    ----------------------------------------------------------------------------
    2001  Total compensable workyears: Full-
            time equivalent employment......         301         330         330
    ---------------------------------------------------------------------------

                            Administrative Provisions

        Sec. 201. Extenders.--(a) Public Housing Funding Flexibility.--
    Section 201(a)(2) of the Departments of Veterans Affairs and Housing and
    Urban Development, and Independent Agencies Appropriations Act, 1996 is
    amended by striking [``1996''] ``1997'' and inserting [``1997'']
    ``1998''.
        (b) One-for-One Replacement of Public and Indian Housing.--Section
    1002(d) of Public Law 104-19 is amended by striking [``before September
    30, 1996''] ``1997'' and inserting [``on or before September 30, 1997'']
    ``1998''.
        (c) Public and Assisted Housing Rents, Income Adjustments, and
    Preferences.--(1)[(A)] Section 402(a) of The Balanced Budget Downpayment
    Act, I is amended[--]
             [(i)] by striking ``[effective for fiscal year 1996 and no
        later than October 30, 1995'' and inserting ``and subsection (f) of
        this section, effective for] fiscal year 1997''[;], and inserting
        ``fiscal year 1998.''
            [(ii) in paragraphs (1), (2), and (4), by striking ``not less
        than $25, and may require a minimum monthly rent of''; and
            (iii) in paragraph (3), by striking ``not less than $25 for the
        unit, and may require a minimum monthly rent of''.
        (B) Section 230 of Public Law 104-134 is hereby repealed.]
        (2) Section 402(f) of The Balanced Budget Downpayment Act, I is
    amended by striking [``fiscal year 1996'' and inserting] ``fiscal years
    1996 and 1997'' and inserting ``fiscal years 1996, 1997, and 1998''.
        (d) Applicability to IHAs.--In accordance with section 201(b)(2) of
    the United States Housing Act of 1937, the amendments made by
    subsections (a), (b), and (c) shall apply to public housing developed or
    operated pursuant to a contract between the Secretary of Housing and
    Urban Development and an Indian housing authority.
        (e) Streamlining Section 8 Tenant-Based Assistance.--Section 203(d)
    of the Departments of Veterans Affairs and Housing and Urban
    Development, and Independent Agencies Appropriations Act, 1996 is
    amended by striking [``fiscal year 1996'' and inserting] ``fiscal years
    1996 and 1997'' and inserting ``fiscal year 1996, 1997, and 1998.''
        (f) Section 8 Fair Market Rentals [and Delay in Reissuance.]--[(1)]
    The first sentence of section 403(a) of the Balanced Budget Downpayment
    Act, I, is amended by striking [``1996''] ``1997'' and inserting
    [``1997''] ``1998''.
        [(2) Section 403(c) of such Act is amended--
             (A) by striking ``fiscal year 1996'' and inserting ``fiscal
        years 1996 and 1997''; and
             (B) by inserting before the semicolon the following: ``for
        assistance made available during fiscal year 1996 and October 1,
        1997 for assistance made available during fiscal year 1997''.]
        (g) Section 8 Rent Adjustments.--Section 8(c)(2)(A) of the United
    States Housing Act of 1937 is amended--
            (1) in the third sentence, by striking ``fiscal year 1997'' and
        inserting ``fiscal years 1997 and 1998'';
            (2) in the last sentence, by striking ``fiscal year 1997'' and
        inserting ``fiscal year 1997 and 1998''.
            [(1) in the third sentence by inserting ``, fiscal year 1996
        prior to April 26, 1996, and fiscal year 1997'' after ``1995'';
             (2) in the fourth sentence, by striking ``For'' and inserting
        ``Except for assistance under the certificate program, for'';
             (3) after the fourth sentence, by inserting the following new
        sentence: ``In the case of assistance under the certificate program,
        0.01 shall be subtracted from the amount of the annual adjustment
        factor (except that the factor shall not be reduced to less than
        1.0), and the adjusted rent shall not exceed the rent for a
        comparable unassisted unit of similar quality, type, and age in the
        market area.''; and
             (4) in the last sentence, by--
                 (A) striking ``sentence'' and inserting ``two sentences'';
            and
                (B) inserting ``, fiscal year 1996 prior to April 26, 1996,
            and fiscal year 1997'' after ``1995''.]
        Sec. 202. Section 8 Administrative Fees.--Section 202(a)(1)(A) of
    the Departments of Veterans Affairs and Housing and Urban Development,
    and Independent Agencies Appropriations Act, 1997, is amended by--
            (1) striking ``7.5 percent'' and inserting ``7.65 percent'';
            (2) striking ``a program of'' and inserting ``one or more such
        programs totaling''; and
            (3) inserting before the final period, ``of such total units.''
        The amendments made by this section shall take effect on October 1,
        1997. [Administrative Fees.--Notwithstanding section 8(q) of the
        United States Housing Act of 1937, as amended--
        (a) The Secretary shall establish fees for the cost of administering
    the certificate, voucher and moderate rehabilitation programs.
             (1)(A) For fiscal year 1997, the fee for each month for which a
        dwelling unit is covered by an assistance contract shall be 7.5
        percent of the base amount, adjusted as provided herein, in the case
        of an agency that, on an annual basis, is administering a program of
        no more than 600 units, and 7 percent of the base amount, adjusted
        as provided herein, for each additional unit above 600.
             (B) The base amount shall be the higher of--
                (i) the fair market rental for fiscal year 1993 for a 2-
            bedroom existing rental dwelling unit in the market area of the
            agency; and
                (ii) such fair market rental for fiscal year 1994, but not
            more than 103.5 percent of the amount determined under clause
            (i).
             (C) The base amount shall be adjusted to reflect changes in the
        wage data or other objectively measurable data that reflect the
        costs of administering the program during fiscal year 1996; except
        that the Secretary may require that the base amount be not less than
        a minimum amount and not more than a maximum amount.

    [[Page 572]]

             (2) For subsequent fiscal years, the Secretary shall publish a
        notice in the Federal Register, for each geographic area,
        establishing the amount of the fee that would apply for the agencies
        administering the program, based on changes in wage data or other
        objectively measurable data that reflect the cost of administering
        the program, as determined by the Secretary.
            (3) The Secretary may increase the fee if necessary to reflect
        higher costs of administering small programs and programs operating
        over large geographic areas.
            (4) The Secretary may decrease the fee for PHA-owned units.
        (b) Beginning in fiscal year 1997 and thereafter, the Secretary
    shall also establish reasonable fees (as determined by the Secretary)
    for--
            (1) the costs of preliminary expenses, in the amount of $500,
        for a public housing agency, but only in the first year it
        administers a tenant-based assistance program under the United
        States Housing Act of 1937 and only if, immediately before the
        effective date of this Act, it was not administering a tenant-based
        assistance program under the 1937 Act (as in effect immediately
        before the effective date of this Act), in connection with its
        initial increment of assistance received;
             (2) the costs incurred in assisting families who experience
        difficulty (as determined by the Secretary) in obtaining appropriate
        housing under the program; and
             (3) extraordinary costs approved by the Secretary.]
        [Sec. 203. Single Family Assignment Program.--Section 407(c) of the
    Balanced Budget Downpayment Act, I (12 U.S.C. 1710 note), is amended by
    striking ``October 1, 1996'' and inserting ``October 1, 1997''.]
        [Sec. 204. Flexible Authority.--During fiscal year 1997 and fiscal
    years thereafter, the Secretary may manage and dispose of multifamily
    properties owned by the Secretary and multifamily mortgages held by the
    Secretary on such terms and conditions as the Secretary may determine,
    notwithstanding any other provision of law.]
        [Sec. 205. Use of Available Funding for Homeownership.--Up to
    $20,000,000 of amounts of unobligated balances that are or become
    available from the Nehemiah Housing Opportunity Grant program, repealed
    under section 289(b) of the Cranston-Gonzalez National Affordable
    Housing Act, Public Law 101-625, shall be available for use for
    activities relating to promotion and implementation of homeownership in
    targeted geographic areas, as determined by the Secretary. Any grant or
    assistance made under this section shall be made in accordance with
    section 102 of the Department of Housing and Urban Development Reform
    Act of 1989 on a competitive basis.]
        [Sec. 206. Debt Forgiveness.--The Secretary of Housing and Urban
    Development shall cancel the indebtedness of the Greene County Rural
    Health Center relating to a loan received under the Public Facility Loan
    program to establish the health center (Loan #Mis-22-PFL0096). The
    Greene County Rural Health Center is hereby relieved of all liability to
    the Federal Government for such loan and any fees and charges payable in
    connection with such loan.]
        [Sec. 207. Flexible Subsidy Fund.--From the fund established by
    section 236(g) of the National Housing Act, as amended, all uncommitted
    balances of excess rental charges as of September 30, 1996, and any
    collection during fiscal year 1997, shall be transferred, as authorized
    under such section, to the fund authorized under section 201(j) of the
    Housing and Community Development Amendments of 1978, as amended.]
        [Sec. 208. Rental Housing Assistance.--The limitation otherwise
    applicable to the maximum payments that may be required in any fiscal
    year by all contracts entered into under section 236 of the National
    Housing Act (12 U.S.C. 1715z-1) is reduced in fiscal year 1997 by not
    more than $2,000,000 in uncommitted balances of authorizations provided
    for this purpose in appropriations Acts.]
        [Sec. 209. D.C. Modernization Funding.--Notwithstanding the
    provisions of section 14(k)(5)(D) of the United States Housing Act of
    1937, the withheld modernization funds that became credited in fiscal
    years 1993, 1994, and 1995, due to the troubled status of the former
    Department of Public and Assisted Housing of the District of Columbia,
    shall be made available without diminution to its successor, the
    District of Columbia Housing Authority, at such time between the
    effective date of this Act and the end of fiscal year 1998 as the
    District of Columbia Housing Authority is no longer deemed ``mod-
    troubled'' under section 6(j)(2)(A)(i) of such Act; after fiscal year
    1998, the District of Columbia Housing Authority shall become subject to
    the provisions of section 14(k)(5)(D) of such Act should it remain mod-
    troubled.]
        Sec. [210. (a)] 203. Financing Adjustment Factors.--Fifty per centum
    of the amounts of budget authority, or in lieu thereof 50 per centum of
    the cash amounts associated with such budget authority, that are
    recaptured from projects described in section 1012(a) of the Stewart B.
    McKinney Homeless Assistance Amendments Act of 1988 (Public Law 100-
    628, 102 Stat. 3224, 3268) shall be rescinded, or in the case of cash,
    shall be remitted to the Treasury, and such amounts of budget authority
    or cash recaptured and not rescinded or remitted to the Treasury shall
    be used by State housing finance agencies or local governments or local
    housing agencies with projects approved by the Secretary of Housing and
    Urban Development for which settlement occurred after January 1, 1992,
    in accordance with such section.
        [(b) In addition to amounts otherwise provided by this Act, $464,442
    is appropriated to the Department of Housing and Urban Development for
    payment to the Utah Housing Finance Agency, in lieu of amounts lost to
    such agency in bond refinancings during 1994, for its use in accordance
    with subsection (a).]
        Sec. 204. Section 8 Contract Renewals.--Section 405(a) of the
    Balanced Budget Downpayment Act, I is amended by inserting at the end
    the following new sentences:
    ``Notwithstanding the preceding sentence, upon the expiration of a
    contract with rent levels that exceed the section 8 Existing Fair Market
    Rents, if the Secretary determines that (i) the primary financing or
    mortgage insurance for the multifamily housing project that is covered
    by that expiring contract was provided by a public agency and the
    financing does not involve mortgage insurance under the National Housing
    Act, or (ii) the project is a section 202 project or a section 515
    project, the Secretary may, at the request of the owner and, in the case
    of projects under clause (i), the public agency, provide assistance
    under section 8 at rent levels that are equal to those under the
    expiring contract as of the date on which the contract expires, which
    assistance shall be in accordance with terms and conditions prescribed
    by the Secretary.''.
        [Sec. 211. Section 8 Contract Renewal Authority.--(a) Definitions.--
    For purposes of this section--
         (1) the term ``expiring contract'' means a contract for project-
    based assistance under section 8 of the United States Housing Act of
    1937 that expires during fiscal year 1997;
         (2) the term ``family'' has the same meaning as in section 3(b) of
    the United States Housing Act of 1937;
         (3) the term ``multifamily housing project'' means a property
    consisting of more than 4 dwelling units that is covered in whole or in
    part by a contract for project-based assistance under section 8 of the
    United States Housing Act of 1937;
         (4) the term ``owner'' has the same meaning as in section 8(f) of
    the United States Housing Act of 1937;
         (5) the term ``project-based assistance'' means rental assistance
    under section 8 of the United States Housing Act of 1937 that is
    attached to a multifamily housing project;
         (6) the term ``public agency'' means a State housing finance
    agency, a local housing agency, or other agency with a public purpose
    and status;
         (7) the term ``Secretary'' means the Secretary of Housing and Urban
    Development; and
         (8) the term ``tenant-based assistance'' has the same meaning as in
    section 8(f) of the United States Housing Act of 1937.
        (b) Section 8 Contract Renewal Authority.--
            (1) In general.--Notwithstanding section 405(a) of the Balanced
        Budget Downpayment Act, I, upon the request of the owner of a
        multifamily housing project that is covered by an expiring contract,
        the Secretary shall use amounts made available for the renewal of
        assistance under section 8 of the United States Housing Act of 1937
        to renew the expiring contract as project-based assistance for a
        period of not more than one year, at rent levels that are equal to
        those under the expiring contract as of the date on which the
        contract expires: Provided, That those rent levels do not exceed 120
        percent of the fair market rent for the market area in which the
        project is located. For an FHA-insured multifamily housing project
        with an expiring contract at rent levels that exceed 120 percent of
        the fair market rent for the market area, the Secretary shall
        provide, at the request of the owner, section 8 project-based
        assistance, for a period of not more than one year, at rent levels
        that do not exceed 120 percent of the fair market rent.

    [[Page 573]]

            (2) Exemption for state and local housing agency projects.--
        Notwithstanding paragraph (1), upon the expiration of a contract
        with rent levels that exceed the percentage described in that
        paragraph, if the Secretary determines that the primary financing or
        mortgage insurance for the multifamily housing project that is
        covered by that expiring contract was provided by a public agency,
        the Secretary shall, at the request of the owner and the public
        agency, renew the expiring contract--
                (A) for a period of not more than one year; and
                (B) at rent levels that are equal to those under the
            expiring contract as of the date on which the contract expires.
            (3) Section 202, section 811, and section 515 projects.--
        Notwithstanding paragraph (1), for section 202 projects, section 811
        projects and section 515 projects, upon the expiration of a section
        8 contract, the Secretary shall, at the request of the owner, renew
        the expiring contract--
                (A) for a period of not more than one year; and
                (B) at rent levels that are equal to those under the
            expiring contract as of the date on which the contract expires.
            (4) Other contracts.--
                (A) Participation in demonstration.--For a contract covering
            an FHA-insured multifamily housing project that expires during
            fiscal year 1997 with rent levels that exceed the percentage
            described in paragraph (1) and after notice to the tenants, the
            Secretary shall, at the request of the owner of the project and
            after notice to the tenants, include that multifamily housing
            project in the demonstration program under section 212 of this
            Act. The Secretary shall ensure that a multifamily housing
            project with an expiring contract in fiscal year 1997 shall be
            allowed to be included in the demonstration.
                (B) Effect of material adverse actions and omissions.--
            Notwithstanding paragraph (1) or any other provision of law, the
            Secretary shall not renew an expiring contract if the Secretary
            determines that the owner of the multifamily housing project has
            engaged in material adverse financial or managerial actions or
            omissions with regard to the project (or with regard to other
            similar projects if the Secretary determines that such actions
            or omissions constitute a pattern of mismanagement that would
            warrant suspension or debarment by the Secretary).
             (C) Transfer of property.--For properties disqualified from the
        demonstration program because of actions by an owner or purchaser in
        accordance with subparagraph (B), the Secretary shall establish
        procedures to facilitate the voluntary sale or transfer of the
        property, with a preference for tenant organizations and tenant-
        endorsed community-based nonprofit and public agency purchasers
        meeting such reasonable qualifications as may be established by the
        Secretary. The Secretary may include the transfer of section 8
        project-based assistance.
                 (5) Tenant protections.--Any family residing in an assisted
            unit in a multifamily housing project that is covered by an
            expiring contract that is not renewed, shall be offered tenant-
            based assistance before the date on which the contract expires
            or is not renewed.]
        [Sec. 212. FHA Multifamily Demonstration Authority.--
    (a) In General.--
         (1) Repeal.--
             (A) In general.--Section 210 of the Departments of Veterans
        Affairs and Housing and Urban Development and Independent Agencies
        Appropriations Act, 1996 (110 Stat. 1321) is repealed.
             (B) Exception.--Notwithstanding the repeal under subparagraph
        (A), amounts made available under section 210(f) the Departments of
        Veterans Affairs and Housing and Urban Development and Independent
        Agencies Appropriations Act, 1996 shall remain available for the
        demonstration program under this section through the end of fiscal
        year 1997.
         (2) Savings provisions.--Nothing in this section shall be construed
    to affect any commitment entered into before the date of enactment of
    this Act under the demonstration program under section 210 of the
    Departments of Veterans Affairs and Housing and Urban Development and
    Independent Agencies Appropriations Act, 1996.
         (3) Definitions.--For purposes of this section--
             (A) the term ``demonstration program'' means the program
        established under subsection (b);
             (B) the term ``expiring contract'' means a contract for
        project-based assistance under section 8 of the United States
        Housing Act of 1937 that expires during fiscal year 1997;
             (C) the term ``family'' has the same meaning as in section 3(b)
        of the United States Housing Act of 1937;
             (D) the term ``multifamily housing project'' means a property
        consisting of more than 4 dwelling units that is covered in whole or
        in part by a contract for project-based assistance;
             (E) the term ``owner'' has the same meaning as in section 8(f)
        of the United States Housing Act of 1937;
             (F) the term ``project-based assistance'' means rental
        assistance under section 8 of the United States Housing Act of 1937
        that is attached to a multifamily housing project;
             (G) the term ``Secretary'' means the Secretary of Housing and
        Urban Development; and
             (H) the term ``tenant-based assistance'' has the same meaning
        as in section 8(f) of the United States Housing Act of 1937.
        (b) Demonstration Authority.--
            (1) In general.--Subject to the funding limitation in subsection
        (l), the Secretary shall administer a demonstration program with
        respect to multifamily projects--
                (A) whose owners agree to participate;
                (B) with rents on units assisted under section 8 of the
            United States Housing Act of 1937 that are, in the aggregate, in
            excess of 120 percent of the fair market rent of the market area
            in which the project is located; and
                (C) the mortgages of which are insured under the National
            Housing Act.
            (2) Purpose.--The demonstration program shall be designed to
        obtain as much information as is feasible on the economic viability
        and rehabilitation needs of the multifamily housing projects in the
        demonstration, to test various approaches for restructuring
        mortgages to reduce the financial risk to the FHA Insurance Fund
        while reducing the cost of section 8 subsidies, and to test the
        feasibility and desirability of--
                (A) ensuring, to the maximum extent practicable, that the
            debt service and operating expenses, including adequate
            reserves, attributable to such multifamily projects can be
            supported at the comparable market rent with or without mortgage
            insurance under the National Housing Act and with or without
            additional section 8 rental subsidies;
                (B) utilizing section 8 rental assistance, while taking into
            account the capital needs of the projects and the need for
            adequate rental assistance to support the low- and very low-
            income families residing in such projects; and
                (C) preserving low-income rental housing affordability and
            availability while reducing the long-term cost of section 8
            rental assistance.
        (c) Goals.--
            (1) In general.--The Secretary shall carry out the demonstration
        program in a manner that will protect the financial interests of the
        Federal Government through debt restructuring and subsidy reduction
        and, in the least costly fashion, address the goals of--
                (A) maintaining existing affordable housing stock in a
            decent, safe, and sanitary condition;
                (B) minimizing the involuntary displacement of tenants;
                (C) taking into account housing market conditions;
                (D) encouraging responsible ownership and management of
            property;
                (E) minimizing any adverse income tax impact on property
            owners; and
                (F) minimizing any adverse impacts on residential
            neighborhoods and local communities.
            (2) Balance of competing goals.--In determining the manner in
        which a mortgage is to be restructured or a subsidy reduced under
        this subsection, the Secretary may balance competing goals relating
        to individual projects in a manner that will further the purposes of
        this section.
        (d) Participation Arrangements.--
            (1) In general.--In carrying out the demonstration program, the
        Secretary may enter into participation arrangements with designees,
        under which the Secretary may provide for the assumption by
        designees (by delegation, by contract, or otherwise) of some or all
        of the functions, obligations, responsibilities and benefits of the
        Secretary.
            (2) Designees.--In entering into any arrangement under this
        subsection, the Secretary shall select state housing finance
        agencies, housing agencies or nonprofits (separately or in
        conjunction with each other) to act as designees to the extent such
        agencies are determined to be qualified by the Secretary. In
        locations where there is no qualified State housing finance agency,
        housing agency or nonprofit to act as a designee, the Secretary may
        act as a designee. Each participation arrangement entered into under
        this

    [[Page 574]]

        subsection shall include a designee as the primary partner. Any
        organization selected by the Secretary under this section shall have
        a long-term record of service in providing low-income housing and
        meet standards of fiscal responsibility, as determined by the
        Secretary.
            (3) Designee partnerships.--For purposes of any participation
        arrangement under this subsection, designees are encouraged to
        develop partnerships with each other, and to contract or subcontract
        with other entities, including--
                (A) public housing agencies;
                (B) financial institutions;
                (C) mortgage servicers;
                (D) nonprofit and for-profit housing organizations;
                (E) the Federal National Mortgage Association;
                (F) the Federal Home Loan Mortgage Corporation;
                (G) Federal Home Loan Banks; and
                (H) other State or local mortgage insurance companies or
            bank lending consortia.
        (e) Long-Term Affordability.--
            (1) In general.--After the renewal of a section 8 contract
        pursuant to a restructuring under this section, the owner shall
        accept each offer to renew the section 8 contract, for a period of
        20 years from the date of the renewal under the demonstration, if
        the offer to renew is on terms and conditions, as agreed to by the
        Secretary or designee and the owner under a restructuring.
            (2) Affordability requirements.--Except as otherwise provided by
        the Secretary, in exchange for any mortgage restructuring under this
        section, a project shall remain affordable for a period of not less
        than 20 years. Affordability requirements shall be determined in
        accordance with guidelines established by the Secretary or designee.
        The Secretary or designee may waive these requirements for good
        cause.
        (f) Procedures.--
            (1) Notice of participation in demonstration.--Not later than 45
        days before the date of expiration of an expiring contract (or such
        later date, as determined by the Secretary, for good cause), the
        owner of the multifamily housing project covered by that expiring
        contract shall notify the Secretary or designee and the residents of
        the owner's intent to participate in the demonstration program.
            (2) Demonstration contract.--Upon receipt of a notice under
        paragraph (1), the owner and the Secretary or designee shall enter
        into a demonstration contract, which shall provide for initial
        section 8 project-based rents at the same rent levels as those under
        the expiring contract or, if practical, the budget-based rent to
        cover debt service, reasonable operating expenses (including
        reasonable and appropriate services), and a reasonable return to the
        owner, as determined solely by the Secretary. The demonstration
        contract shall be for the minimum term necessary for the rents and
        mortgages of the multifamily housing project to be restructured
        under the demonstration program, but shall not be for a period of
        time to exceed 180 days, unless extended for good cause by the
        Secretary.
        (g) Project-Based Section 8.--The Secretary shall renew all expiring
    contracts under the demonstration as section 8 project-based contracts,
    for a period of time not to exceed one year, unless otherwise provided
    under subsection (h).
        (h) Demonstration Actions.--
            (1) Demonstration actions.--For purposes of carrying out the
        demonstration program, and in order to ensure that contract rights
        are not abrogated, subject to such third party consents as are
        necessary (if any), including consent by the Government National
        Mortgage Association if it owns a mortgage insured by the Secretary,
        consent by an issuer under the mortgage-backed securities program of
        the Association, subject to the responsibilities of the issuer to
        its security holders and the Association under such program, and
        consent by parties to any contractual agreement which the Secretary
        proposes to modify or discontinue, the Secretary or, except with
        respect to subparagraph (B), designee, subject to the funding
        limitation in subsection (l), shall take not less than one of the
        actions specified in subparagraphs (G), (H), and (I) and may take
        any of the following actions:
                (A) Removal of restrictions.--
                    (i) In general.--Consistent with the purposes of this
                section, subject to the agreement of the owner of the
                project and after consultation with the tenants of the
                project, the Secretary or designee may remove, relinquish,
                extinguish, modify, or agree to the removal of any mortgage,
                regulatory agreement, project-based assistance contract, use
                agreement, or restriction that had been imposed or required
                by the Secretary, including restrictions on distributions of
                income which the Secretary or designee determines would
                interfere with the ability of the project to operate without
                above-market rents.
                    (ii) Accumulated residual receipts.--The Secretary or
                designee may require an owner of a property assisted under
                the section 8 new construction/substantial rehabilitation
                program under the United States Housing Act of 1937 to apply
                any accumulated residual receipts toward effecting the
                purposes of this section.
                (B) Reinsurance.--With respect to not more than 5,000 units
            within the demonstration during fiscal year 1997, the Secretary
            may enter into contracts to purchase reinsurance, or enter into
            participations or otherwise transfer economic interest in
            contracts of insurance or in the premiums paid, or due to be
            paid, on such insurance, on such terms and conditions as the
            Secretary may determine. Any contract entered into under this
            paragraph shall require that any associated units be maintained
            as low-income units for the life of the mortgage, unless waived
            by the Secretary for good cause.
                (C) Participation by third parties.--The Secretary or
            designee may enter into such agreements, provide such
            concessions, incur such costs, make such grants (including
            grants to cover all or a portion of the rehabilitation costs for
            a project) and other payments, and provide other valuable
            consideration as may reasonably be necessary for owners,
            lenders, servicers, third parties, and other entities to
            participate in the demonstration program. The Secretary may
            establish performance incentives for designees.
                (D) Section 8 administrative fees.--Notwithstanding any
            other provision of law, the Secretary may make fees available
            from the section 8 contract renewal appropriation to a designee
            for contract administration under section 8 of the United States
            Housing Act of 1937 for purposes of any contract restructured or
            renewed under the demonstration program.
                (E) Full or partial payment of claim.--Notwithstanding any
            other provision of law, the Secretary may make a full payment of
            claim or partial payment of claim prior to default.
                (F) Credit enhancement.--
                    (i) In general.--The Secretary or designee may provide
                FHA multifamily mortgage insurance, reinsurance, or other
                credit enhancement alternatives, including retaining the
                existing FHA mortgage insurance on a restructured first
                mortgage at market value or using the multifamily risk-
                sharing mortgage programs, as provided under section 542 of
                the Housing and Community Development Act of 1992. Any
                limitations on the number of units available for mortgage
                insurance under section 542 shall not apply to insurance
                issued for purposes of the demonstration program.
                    (ii) Maximum percentage.--During fiscal year 1997, not
                more than 25 percent of the units in multifamily housing
                projects with expiring contracts in the demonstration, in
                the aggregate, may be restructured without FHA insurance,
                unless otherwise agreed to by the owner of a project.
                    (iii) Credit subsidy.--Any credit subsidy costs of
                providing mortgage insurance shall be paid from amounts made
                available under subsection (l).
                (G) Mortgage restructuring.--
                    (i) In general.--The Secretary or designee may
                restructure mortgages to provide a restructured first
                mortgage to cover debt service and operating expenses
                (including a reasonable rate of return to the owner) at the
                market rent, and a second mortgage equal to the difference
                between the restructured first mortgage and the mortgage
                balance of the eligible multifamily housing project at the
                time of restructuring.
                    (ii) Credit subsidy.--Any credit subsidy costs of
                providing a second mortgage shall be paid from amounts made
                available under subsection (l).
                (H) Debt forgiveness.--The Secretary or designee, for good
            cause and at the request of the owner of a multifamily housing
            project, may forgive at the time of the restructuring of a
            mortgage any portion of a debt on the project that exceeds the
            market value of the project.
                (I) Budget-based rents.--The Secretary or designee may renew
            an expiring contract, including a contract for a project

    [[Page 575]]

            in which operating costs exceed comparable market rents, for a
            period of not more than one year, at a budget-based rent that
            covers debt service, reasonable operating expenses (including
            all reasonable and appropriate services), and a reasonable rate
            of return to the owner, as determined solely by the Secretary,
            provided that the contract does not exceed the rent levels under
            the expiring contract. The Secretary may establish a preference
            under the demonstration program for budget-based rents for
            unique housing projects, such as projects designated for
            occupancy by elderly families and projects in rural areas.
                (J) Section 8 tenant-based assistance.--For not more than 10
            percent of units in multifamily housing projects that have had
            their mortgages restructured in any fiscal year under the
            demonstration, the Secretary or designee may provide, with the
            agreement of an owner and in consultation with the tenants of
            the housing, section 8 tenant-based assistance for some or all
            of the assisted units in a multifamily housing project in lieu
            of section 8 project-based assistance. Section 8 tenant-based
            assistance may only be provided where the Secretary determines
            and certifies that there is adequate available and affordable
            housing within the local area and that tenants will be able to
            use the section 8 tenant-based assistance successfully.
            (2) Offer and acceptance.--Notwithstanding any other provision
        of law, an owner of a project in the demonstration must accept any
        reasonable offer made by the Secretary or a designee under this
        subsection. An owner may appeal the reasonableness of any offer to
        the Secretary and the Secretary shall respond within 30 days of the
        date of appeal with a final offer. If the final offer is not
        acceptable, the owner may opt out of the program.
         (i) Community and Tenant Input.--In carrying out this section, the
    Secretary shall develop procedures to provide appropriate and timely
    notice, including an opportunity for comment and timely access to all
    relevant information, to officials of the unit of general local
    government affected, the community in which the project is situated, and
    the tenants of the project.
         (j) Transfer of Property.--The Secretary shall establish procedures
    to facilitate the voluntary sale or transfer of multifamily housing
    projects under the demonstration to tenant organizations and tenant-
    endorsed community-based nonprofit and public agency purchasers meeting
    such reasonable qualifications as may be established by the Secretary.
         (k) Limitation on Demonstration Authority.--The Secretary shall
    carry out the demonstration program with respect to mortgages not to
    exceed 50,000 units.
         (l) Funding.--In addition to the $30,000,000 made available under
    section 210 of the Departments of Veterans Affairs and Housing and Urban
    Development and Independent Agencies Appropriations Act, 1996 (110 Stat.
    1321), for the costs (including any credit subsidy costs associated with
    providing direct loans or mortgage insurance) of modifying and
    restructuring loans held or guaranteed by the Federal Housing
    Administration, as authorized under this section, $10,000,000 is hereby
    appropriated, to remain available until September 30, 1998.
         (m) Report to Congress.--
             (1) In general.--
                 (A) Quarterly reports.--Not less than every 3 months, the
            Secretary shall submit to the Congress a report describing and
            assessing the status of the projects in the demonstration
            program.
                 (B) Final report.--Not later than 6 months after the end of
            the demonstration program, the Secretary shall submit to the
            Congress a final report on the demonstration program.
             (2) Contents.--Each report submitted under paragraph (1)(A)
        shall include a description of--
                 (A) each restructuring proposal submitted by an owner of a
            multifamily housing project, including a description of the
            physical, financial, tenancy, and market characteristics of the
            project;
                 (B) the Secretary's evaluation and reasons for each
            multifamily housing project selected or rejected for
            participation in the demonstration program;
                 (C) the costs to the FHA General Insurance and Special Risk
            Insurance funds;
                 (D) the subsidy costs provided before and after
            restructuring;
                 (E) the actions undertaken in the demonstration program,
            including the third-party arrangements made; and
                 (F) the demonstration program's impact on the owners of the
            projects, including any tax consequences.
             (3) Contents of final report.--The report submitted under
        paragraph (1)(B) shall include--
                 (A) the required contents under paragraph (2); and (B) any
            findings and recommendations for legislative action.]
        [Sec. 213. Hawaiian Home Lands.--Section 282 of the Cranston-
    Gonzalez National Affordable Housing Act (42 U.S.C. 12832) is amended by
    adding at the end the following new sentence: ``The Secretary may waive
    this section in connection with the use of funds made available under
    this title on lands set aside under the Hawaiian Homes Commission Act,
    1920 (42 Stat. 108).''.]
        [Sec. 214. Uses of Certain Assisted Housing Amounts.--(a) Transfer
    Authority.--The Secretary may transfer recaptured section 8 amounts from
    the Annual Contributions for Assisted Housing account under Public Law
    104-134 (approved April 26, 1996; 110 Stat. 1321, 1321-265) and prior
    laws to the accounts and for the purposes set forth in subsection (b).
    The amounts transferred under this section shall be made available for
    use as prescribed under this section notwithstanding section 8(bb) of
    the United States Housing Act of 1937.
        (b) Receiving Accounts.--
             (1) Prevention of resident displacement.--The Secretary may
        transfer to the Prevention of Resident Displacement account an
        amount up to $50,000,000, in addition to amounts in such account,
        that may be used to extend, under existing terms and conditions,
        existing project-based section 8 contracts in effect before a Plan
        of Action was approved, so that these contracts expire 5 years from
        the date on which funds were obligated for the Plan of Action
        approved under the Low-Income Housing Preservation and Resident
        Homeownership Act of 1990 or the Emergency Low Income Housing
        Preservation Act of 1987. The Secretary shall transfer all amounts
        that the Secretary determines to be necessary for fiscal year 1997
        for the purposes of this paragraph before transferring any amounts
        under any other paragraph in this subsection.
            (2) HOPWA.--The Secretary may transfer to the Housing
        Opportunities for Persons with AIDS account up to $25,000,000, for
        use in addition to amounts appropriated in such account.]
        [Sec. 215. Requirement for HUD To Maintain Public Notice and Comment
    Rulemaking.--The Secretary of Housing and Urban Development shall
    maintain all current requirements under part 10 of the Department of
    Housing and Urban Development's regulations (24 CFR part 10) with
    respect to the Department's policies and procedures for the promulgation
    and issuance of rules, including the use of public participation in the
    rulemaking process.]
        [Sec. 216. Community Development Block Grants.--Section 102(a)(6)(D)
    of the Housing and Community Development Act of 1974 (42 U.S.C.
    5302(a)(6)(D)) is amended--
             (1) in clause (iv), by striking ``or'' at the end;
             (2) in clause (v), by striking the period at the end and
        inserting ``; or''; and
             (3) by adding at the end the following new clause:
                 ``(vi) has entered into a local cooperation agreement with
            a metropolitan city that received assistance under section 106
            because of such classification, and has elected under paragraph
            (4) to have its population included with the population of the
            county for the purposes of qualifying as an urban county, except
            that to qualify as an urban county under this clause, the county
            must--
                     ``(I) have a combined population of not less than
                210,000, excluding any metropolitan city located in the
                county that is not relinquishing its metropolitan city
                classification, according to the 1990 decennial census of
                the Bureau of the Census of the Department of Commerce;
                     ``(II) including any metropolitan cities located in the
                county, have had a decrease in population of 10,061 from
                1992 to 1994, according to the estimates of the Bureau of
                the Census of the Department of Commerce; and
                     ``(III) have had a Federal naval installation that was
                more than 100 years old closed by action of the Base Closure
                and Realignment Commission appointed for 1993 under the Base
                Closure and Realignment Act of 1990, directly resulting in a
                loss of employment by more than 7,000 Federal Government
                civilian employees and more than 15,000 active duty military
                personnel, which naval installation was located within one
                mile of an enterprise community designated by the Secretary
                pursuant to section 1391 of the Internal Revenue Code of
                1986, which enterprise community has a population of not
                less than 20,000, according to the 1990 decennial census of
                the Bureau of the Census of the Department of Commerce.''.]

    [[Page 576]]

        [Sec. 217. Fair Housing and Free Speech.--None of the amounts made
    available under this Act may be used during fiscal year 1997 to
    investigate or prosecute under the Fair Housing Act any otherwise lawful
    activity engaged in by one or more persons, including the filing or
    maintaining of a nonfrivolous legal action, that is engaged in solely
    for the purpose of achieving or preventing action by a government
    official or entity, or a court of competent jurisdiction.]
        [Sec. 218. Account Transition.--The amounts of obligated balances in
    appropriations accounts, as set forth in title II of the Departments of
    Veterans Affairs and Housing and Urban Development, and Independent
    Agencies Appropriations Act, 1996 and prior Acts that are recaptured
    hereafter, to the extent not governed by the specific language in an
    account or provision in this Act, shall be held in reserve subject to
    reprogramming, notwithstanding any other provision of law.]
        [Sec. 219. Treatment of Certain Properties.--Notwithstanding any
    other provision of law, rehabilitation activities undertaken in projects
    using the Low-Income Housing Tax Credit allocated to developments in the
    city of New Brunswick, New Jersey, in 1991, are deemed to have met the
    requirements for rehabilitation in accordance with clause (ii) of the
    third sentence of section 8(d)(2)(A) of the United States Housing Act of
    1937, as in effect before the date of the enactment of this Act.]
        [Sec. 220. Amendment Relating to Community Development Assistance.--
    Section 105(a) of the Housing and Community Development Act of 1974 (42
    U.S.C. 5305(a)(8)) is amended by striking ``through 1997'' and inserting
    ``through 1998''.]
        [Sec. 221. Section 236 Program Amendments.--(a) Section 236(f)(1) of
    the National Housing Act (12 U.S.C. 1715z-1), as amended by section
    405(d)(1) of The Balanced Budget Downpayment Act, I, and by section
    228(a) of The Balanced Budget Downpayment Act, II, is amended--
             (1) in the second sentence, by striking ``the lower of (i)'';
             (2) in the second sentence, by striking ``or (ii) the fair
        market rental established under section 8(c) of the United States
        Housing Act of 1937 for the market area in which the housing is
        located, or (iii) the actual rent (as determined by the Secretary)
        paid for a comparable unit in comparable unassisted housing in the
        market area in which the housing assisted under this section is
        located,''; and
             (3) by inserting after the second sentence the following:
        ``However, in the case of a project which contains more than 5,000
        units, is subject to an interest reduction payments contract, and is
        financed under a State or local program, the Secretary may reduce
        the rental charge ceiling, but in no case shall the rent be below
        basic rent. For plans of action approved for Capital Grants under
        the Low-Income Housing Preservation and Resident Homeownership Act
        of 1990 (LIHPRHA) or the Emergency Low Income Housing Preservation
        Act of 1987 (ELIHPA), the rental charge for each dwelling unit shall
        be at the basic rental charge or such greater amount, not exceeding
        the lower of (i) the fair market rental charge determined pursuant
        to this paragraph, or (ii) the actual rent paid for a comparable
        unit in comparable unassisted housing in the market area in which
        the housing assisted under this section is located, as represents 30
        percent of the tenant's adjusted income, but in no case shall the
        rent be below basic rent.''.
         (b) Section 236(f) of the National Housing Act is amended by adding
    the following new paragraph at the end:
                 ``(7) The Secretary shall determine whether and under what
            conditions the provisions of this subsection shall apply to
            mortgages sold by the Secretary on a negotiated basis.''.
         (c) Section 236(g) of the National Housing Act is amended to read
    as follows:
        ``The project owner shall, as required by the Secretary, accumulate,
    safeguard, and periodically pay the Secretary or such other entity as
    determined by the Secretary and upon such terms and conditions as the
    Secretary deems appropriate, all rental charges collected on a unit-by-
    unit basis in excess of the basic rental charges. Unless otherwise
    directed by the Secretary, such excess charges shall be credited to a
    reserve fund to be used by the Secretary to make additional assistance
    payments as provided in paragraph (3) of subsection (f). However, a
    project owner with a mortgage project use if authorized by the Secretary
    and upon such terms and conditions insured under this section may retain
    some or all of such excess charges for project use if authorized by the
    Secretary and upon such terms and conditions as established by the
    Secretary.''.]
        Sec. 205. Transfers Between Appropriations.--Not to exceed 2 percent
    of any appropriation or earmarked amount made available for the current
    fiscal year in this Act may be transferred between such appropriations
    or earmarked amounts, but no such appropriations or earmarked amounts
    shall be increased or decreased by more than 2 percent by any such
    transfers. (Department of Veterans Affairs and Housing and Urban
    Development, and Independent Agencies Appropriations Act, 1997.)