[Congressional Record Volume 140, Number 13 (Thursday, February 10, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: February 10, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
             HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1994

                                 ______


                         HON. HENRY B. GONZALEZ

                                of texas

                    in the house of representatives

                      Thursday, February 10, 1994

  Mr. GONZALEZ. Mr. Speaker, today I am introducing the Housing and 
Community Development Act of 1994, H.R. 3838, an omnibus 
reauthorization bill of the programs within the jurisdiction of the 
Subcommittee on Housing and Community Development. This bill includes 
the regular reauthorizations required for the public and Indian housing 
programs, the assisted housing programs, the FHA insurance programs, 
the Community Development Block Grant Program, the HOME Investment 
Partnerships Program, the preservation program, the supportive housing 
programs for the elderly, persons with disabilities, and persons with 
AIDS, and regulatory programs. It includes authorizations for the rural 
housing programs administered by the Farmers Home Administration and 
for the programs for the homeless under the Stewart B. McKinney Act. 
Further, it contains a number of technical and clarifying changes that 
are intended to make programs more efficient and effective in serving 
the housing and community development needs of our citizens.
  The bill authorizes a total of approximately $29.6 billion and $30.4 
billion for fiscal years 1995 and 1996, respectively. The funding 
levels in the bill represent an approximate 3 percent increase above 
the levels authorized for these programs in fiscal year 1994. Some 
levels, however, have been inflated by 3 percent above the amount 
appropriated in fiscal year 1994, or in some cases have been increased 
beyond either the authorized or appropriated levels.
  The bill contains an initiative to address a significant crisis in 
affordable housing in the United States. This provision revises the 
Emergency Homeowners Relief Act which would provide assistance to 
homeowners facing foreclosure. It is intended to provide emergency 
mortgage assistance to protect families from losing their homes.
  The bill also contains a merger and rewrite of the section 8 
certificate and voucher programs. The merger will mean better 
protection for low-income families and relief from administrative 
burdens for housing authorities.
  I also have provided several rural housing initiatives, in addition 
to technical and clarifying changes, including a streamlined 
refinancing authority for rental housing, operating assistance in lieu 
of rental assistance for migrant farmworker housing, a delegated 
processing program for single family housing in underserved areas, and 
a technical assistance and capacity building program for Native 
American and Native Alaskan tribes and members of tribes so that they 
can apply for and obtain Federal rural housing assistance.
  The Housing and Community Development Act of 1994 includes many of 
the initiatives and technical changes that were a part of 
the administration's 1993 legislative package, most notably reform of 
the multifamily property disposition program; the Community 
Partnerships Against Crime or COMPAC Program; a new economic grant 
program as part of the section 108 loan guarantee program; and 
provisions which will foster mixed income public housing communities.

  The Multifamily Housing Property Disposition Reform Act in title IV 
incorporates, but restructures, many of the reforms proposed by HUD. 
These reforms will simplify this program as well as preserve all the 
units for low-income residents, and accelerate the property disposition 
process. This provision provides a balanced approach to address one of 
HUD's major weaknesses, the property disposition program.
  I intend that this legislation, once more, focuses our attention to 
our most vulnerable citizens in our Nation's communities and to the 
Federal responsibility for improving the quality of life for our 
Nation's citizens. This legislation will help HUD and the Farmers Home 
Administration in their growing efforts to reverse Federal policy and 
priorities that produced little or no sustained domestic strategy or 
investment in affordable housing or rebuilding our cities and towns. 
More than a million low-income Americans are on waiting lists for 
public housing, more than 800,000 await section 8 assistance, the 
homeless population is burgeoning, and the infrastructure of our 
Nation's communities is crumbling, and the prospects for increased or 
even level funding are quite bleak.
  I have attached the following supplementary materials for the record: 
a short summary, a section by section analysis of the bill, and a 
funding chart.
  I would urge all Members to support and cosponsor this important 
bill.

   Short Summary of the Housing and Community Development Act of 1994

       Funding Levels: The Housing and Community Development Act 
     of 1994 authorizes a total of approximately $29.6 billion and 
     $30.4 billion for fiscal years 1995 and 1996, respectively. 
     These programs are administered through the Department of 
     Housing and Urban Development and the Farmers Home 
     Administration. The funding levels in the bill represent an 
     approximate 3% increase above the levels authorized for these 
     programs in fiscal year 1994. Some levels, however, have been 
     inflated by 3% above the amount appropriated in FY 1994, or 
     in some cases, have been increased beyond either the 
     authorized or appropriated levels. Of the $29.4 billion 
     authorized for fiscal year 1995, the bill authorizes 
     approximately $8.6 billion for HUD public and assisted 
     housing programs; contains a such sums as may be necessary 
     authorization for Section 8 contract renewals and amendments 
     in order to prevent homelessness; provides $2.2 billion for 
     the HOME Investment Partnership program; provides $558.8 
     million for the National Homeownership Trust; authorizes $685 
     million for the preservation of federally-subsidized housing; 
     authorizes $1.6 billion for supportive housing for elderly 
     and disabled persons; authorizes $4.2 billion for the Farmers 
     Home Administration rural housing loan and grant programs; 
     $4.5 billion for the Community Development Block Grant (CDBG) 
     program; and $1.3 billion for the McKinney homeless programs 
     under the Housing Subcommittee's jurisdiction.
       Title I.--Housing Assistance.--Provides various revisions, 
     clarifications, and technical changes to existing HUD public 
     and assisted housing programs. Program changes provided for 
     in the bill include: 1) disallowing counting as earned income 
     for 18 months, increases in income due to the employment of 
     public housing residents who were previously unemployed for a 
     year; 2) making ceiling rents for public housing units 
     reasonably related to the rental value of the units; 3) 
     adding ``community service activities'' by residents and 
     community members, as an eligible activity for planning and 
     implementation grants under the Revitalization of Severely 
     Distressed Public Housing program, and make other clarifying 
     changes to that program; 4) making escrow savings accounts 
     under the Family Self Sufficiency program voluntary instead 
     of required. Technical changes made by the bill include: 1) 
     clarifying the definition of ``families'' for housing 
     assistance eligibility purposes; 2) eliminating requirements 
     under the Comprehensive Improvement Assistance program 
     regarding identification of projected replacement needs by 
     public housing authorities; 3) requiring that all new 
     amendments to public housing provisions in Title I of the 
     United States Housing Act of 1937 be applicable to Indian 
     housing authorities and Indian housing unless otherwise 
     stated.
       Provides for the merger of the Section 8 certificate and 
     voucher rental assistance programs into a single rental 
     assistance program. Combines and restates many current law 
     section 8 provisions, removes outdated provisions, and 
     generally clarifies and streamlines section 8 rental 
     assistance provisions. This provision: 1) maintains the 
     current law certificate program requirement that a low-income 
     tenant cannot pay more than 30% of their adjusted gross 
     income for rent; 2) strengthens privacy protections involving 
     income reviews of low-income families receiving assistance; 
     3) requires the lease between the owner and tenant to contain 
     terms and conditions for the termination of a tenancy, 
     including a written notice requirement; 4) eliminates the 
     current law limitation that PHAs can only use 15% of their 
     section 8 assistance for project-based assistance; 5) 
     requires PHAs to provide counseling on housing opportunities 
     for section 8 recipient families; and 6) revises the current 
     law portability provisions by making a twelve month residency 
     requirement discretionary with a PHA, and providing 
     additional rental assistance funds for portability for PHAs.
       Extends the authority for the National Homeownership Trust 
     and authorizes funding for the HOPE for multifamily and 
     single family housing programs. Provides HUD the authority to 
     provide refinancing incentives for section 235 mortgages. 
     Provides an expanded authorization for housing counseling.
       Establishes the Community Partnerships Against Crime 
     program, which expands the current public and assisted 
     housing drug elimination grant program, authorizing HUD to 
     issue grants to PHAs and owners of federally assisted low-
     income housing for efforts directed to preventing and 
     eliminating all types of crime in and around public and other 
     federally assisted housing. Provides that grants are to be 
     issued for two years, with one-year grants renewable for an 
     additional four years available to PHAs with especially 
     severe crime problems.
       Establishes a separate authorization for the Public Housing 
     Youth Sports Program. Provides a separate authorization for 
     Youthbuild.
       Clarifies, coordinates, and expands requirements under the 
     multifamily planning and investment strategies, the flexible 
     subsidy program, the capital improvements program, and loan 
     management set aside program so that each program provides 
     effective tools to prevent mortgage defaults on HUD insured 
     and HUD assisted projects.
       Title II.--Home Investment Partnerships.--Establishes a 
     flat match of 25 percent for all HOME eligible activities. 
     Provides technical changes to the HOME Investment 
     Partnerships Program which are intended to simplify the 
     administration of the program in an effort to increase and 
     speed up usage of the program, including adding 
     instrumentalities of state agencies as eligible grantees; 
     simplifying income targeting, clarifying the definition of 
     eligible homebuyer and usage of recaptured homeownership 
     grant funds; clarifying comprehensive housing 
     affordability strategy certification requirements; 
     repealing separate audit requirement; defining 
     environmental review requirements and delegation of review 
     requirements; and clarifying the relationship between CDBG 
     funds and HOME funds for administration and service 
     delivery. Requires a GAO study of HOME program fund usage.
       Title III.--Supportive Housing Programs.--Provides 
     authorizations for the supportive housing for the elderly and 
     supportive housing for persons with disabilities; the elder 
     cottage housing demonstration program, the revised congregate 
     housing services program, and service coordinators in mixed 
     populations buildings. Establishes the elderly independence 
     demonstration, separate from the HOPE program.
       Makes several changes to the Housing Opportunities For 
     Persons with AIDS program, including making non-profits that 
     provide technical assistance eligible for nonformula 
     allocation funding, and requiring grantees to establish and 
     implement a process for ensuring coordination and community 
     input in planning for and providing services
       Title IV.--Mortgage Insurance and Secondary Mortgage 
     Market.--Authorizes the Secretary to enter into commitments 
     to insure mortgages under the National Housing Act for a 
     reauthorized amount to be appropriated for FY 1995 and FY 
     1996. Extends the Federal Housing Administration Board's date 
     of termination to January 1, 1997. Extends the Secretary's 
     authority to insure home equity conversion mortgages for the 
     elderly until September 30, 1996. Clarifies the requirements 
     of the multifamily risk sharing Demonstration and the state 
     housing finance pilot program. Reauthorizes appropriations 
     for the Indian Housing Guarantee Loan Program. Establishes 
     aggregate limits for GNMA guarantees of mortgage backed 
     securities.
       Establishes the ``Multifamily Housing Property Disposition 
     Reform Act'' to ensure the preservation of all units for very 
     low and low income tenants, current and future, and to 
     accelerate the disposition of the inventory of HUD held 
     mortgages and HUD owned properties. Provides a simpler and 
     less rigid approach than current law, placing the reforms in 
     more of a market context; providing required section 8 
     assistance and rent restrictions; providing discretionary 
     assistance including short term loans, up front grants and 
     loans, discounted sales prices, transfers for public housing 
     and section 202 and section 811 housing; and alternative uses 
     equal to 5% of those units disposed of in any one fiscal 
     year; and providing predictable streams of income for all 
     properties either through section 8 assistance or flat rents 
     so acquisition and rehabilitation costs can be financed in 
     the marketplace.
       Reauthorizes appropriations and extends the Emergency 
     Homeowners Relief Act of 1975 for FY 1995 and 1996. Amends 
     the program to provide mortgage relief to single family 
     homeowners, upon the Congress' finding that homeowners are 
     experiencing severe economic hardship due to unemployment or 
     income reduction that is causing them to default on their 
     mortgage.
       Title V.--Rural Housing.--Clarifies requirements for 
     moratoria and for reamortizing section 502 single family 
     loans and makes the deferred mortgage program permanent. 
     Establishes a technical assistance program for Native 
     American areas to enable tribes and members of tribes to 
     apply for rural housing program assistance. Establishes a 
     streamlined refinancing program for the section 515 rural 
     rental housing program and provides permanent authorization 
     for the section 515 program. Provides technical and 
     clarifying changes for the rental housing prepayment program. 
     Extends the designation period for the targeted underserved 
     areas program from 1 year to 2 years, except on tribal lands 
     where the designation will be in place for 3 years and 
     extends the nonprofit set aside for the section 515 program. 
     Establishes a set aside for new projects of rental assistance 
     and provides for operating assistance in lieu of rental 
     assistance for migrant farmworker housing. Establishes a 
     rural community development initiative to attract foundation 
     and other private funding for capacity building for nonprofit 
     intermediaries in rural areas and establishes a delegated 
     processing demonstration for section 502 loans in underserved 
     areas.
       Title VI.--Community Development.--Reauthorizes the 
     following programs to be appropriated for FY 1995 and FY 
     1996: (1) the Community Development Block Grant (CDBG) 
     program, (2) the section 108 loan guarantee program, (3) 
     Special Purpose Grants for insular areas, historically black 
     colleges, states or units of local government that jointly 
     apply for a grant with an institution of higher learning to 
     conduct eligible activities, work study grants for minority 
     and economically disadvantaged students, state and local 
     governments whose initial grant was miscalculated, technical 
     assistance, planning community development and economic 
     diversification activities, (4) Neighborhood Reinvestment 
     Corporation, (5) John Heinz Neighborhood Development.
       Amends the CDBG loan guarantee program to enable CDBG 
     recipients participating in the loan program to apply for 
     grants that will buy-down interest rates or create loan loss 
     reserves. Provides that funding for these grants will be 
     acquired from monies recaptured from allocated, but not 
     expended, Urban Development Action Grants. Requires that the 
     grants be distributed in conjunction with section 108 loans 
     to applicants proposing to conduct economic development 
     activities that meet the existing CDBG criteria.
       Increases activities under the CDBG loan program to enable 
     colonias to participate in the loan guarantee program in 
     order to conduct public works activities. Extends the 
     authority of the colonias program to September 30, 1996.
       Title VII.--Regulatory and Miscellaneous Programs.--
     Reauthorizes the following programs to be appropriated for FY 
     1995 and FY 1996: (1) Fair Housing Initiatives Program, (2) 
     HUD Monitoring and Research, (3) HUD Salaries and Expenses, 
     (4) HUD Research and Development, (4) National Institute of 
     Building Sciences, (5) Lead Based Paint Hazard Reduction, (6) 
     New Towns Demonstration Program, and (7) National American 
     Indian Housing Council. Authorizes the Housing Assistance 
     Council. Clarifies subsidy layering review requirements.
       Title VIII.--Housing Programs under Stewart B. McKinney 
     Homeless Assistance Act.--Reauthorizes existing McKinney 
     homeless programs administered by HUD.

------------------------------------------------------------------------
                                  Fiscal year 1995     Fiscal year 1996 
------------------------------------------------------------------------
   TITLE II--HOME INVESTMENT                                            
         PARTNERSHIPS                                                   
                                                                        
HOME Investment Partnership                                             
 Program......................       2,238,820,360        2,305,984,971 
Community Housing Partnership                                           
 Strategies...................         (25,000,000)         (25,000,000)
State/Local Housing Strategies         (22,000,000)         (22,000,000)
Capacity Building for                                                   
 Community Development........         (25,000,000)         (25,000,000) 
                               -----------------------------------------
      Title II total..........       2,238,820,360       2,305,984,971  
                               =========================================
 TITLE III--SUPPORTIVE HOUSING                                          
           PROGRAMS                                                     
                                                                        
Supportive Housing for Elderly/                                         
 Disabled.....................       1,591,350,000        1,639,090,500 
Congregate Services...........          25,750,000           26,522,500 
Elderly Independent Section 8                                           
 Certificates/Vouchers........          41,092,979           42,325,768 
Elderly Independent Services..          10,732,600           11,054,578 
AIDS Housing Program..........         250,000,000          257,500,000 
Mixed Populations (Service                                              
 Coordinators)................           Such sums           Such sums  
                               -----------------------------------------
      Title III total.........       1,918,925,579       1,976,493,346  
                               =========================================
 TITLE IV--MORTGAGE INSURANCE/                                          
       SECONDARY MARKET                                                 
                                                                        
FHA Credit Limitation (MMI)...     (85,000,000,000)     (85,000,000,000)
FHA Credit Limitation (GI/SRI)     (20,000,000,000      (20,000,000,000)
Multifamily Housing Task Force           6,439,560            6,632,747 
Indian Housing Loan Guarantees         (50,000,000)         (50,000,000)
Multifamily Property                                                    
 Disposition..................         300,000,000          300,000,000 
GNMA Credit Limitation........    (130,000,000,000)    (130,000,000,000)
Emergency Mortgage Relief                                               
 Provisions...................           Such sums           Such sums  
                               -----------------------------------------
      Title IV total..........         306,439,560         306,632,747  
                               =========================================
    TITLE V--RURAL HOUSING                                              
                                                                        
Sec. 502 Homeownership                                                  
 (Direct) Loans...............       1,802,500,000        1,856,575,000 
Sec. 502 Unsubsidized                                                   
 Guaranteed Loans.............         772,500,000          795,675,000 
Sec. 504 Improvement Loans....          36,050,000           37,131,500 
Sec. 514 Farm Labor Loans.....          18,053,950           18,595,569 
Sec. 515 Multifamily Loans....         793,675,770          817,486,043 
Sec. 523 Mutual/Self-help                                               
 Loans........................           1,000,000            1,030,000 
Sec. 524 Site Loans...........           1,000,000           1,030,000  
                               -----------------------------------------
      Aggregate Loan Authority       3,424,779,720       3,527,523,112  
                               =========================================
RURAL HOUSING SUPPORT PROGRAMS                                          
Sec. 502(c)(5) Preservation                                             
 Technical Assistance.........          10,000,000           10,000,000 
Sec. 504 Improvement Grants...          31,000,000           31,930,000 
Sec. 509(c) Construction                                                
 Defects Grants...............           1,000,000            1,030,000 
Sec. 509 Project Preparation                                            
 Grants.......................           5,688,278            5,858,926 
Sec. 515 Service Coordinators.           1,073,260            1,105,458 
Sec. 516 Farm Labor Grants....          23,289,742           23,988,434 
Sec. 516(k) Migrant Homeless                                            
 Program......................          11,269,230           11,607,307 
Sec. 523 Mutual/Self-Help                                               
 Grants.......................          14,918,314           15,365,863 
Sec. 533 Preservation Grants..          33,056,408           34,048,100 
Sec. 538 Indian Technical                                               
 Assistance Program...........          10,000,000   ...................
Sec. 539 Rural Community                                                
 Development Initiative.......          20,000,000          20,600,000  
                               -----------------------------------------
      Subtotal................         161,295,232         155,534,089  
                               =========================================
Rental Assistance Payments                                              
 (RAP)........................         454,079,620          467,702,009 
Rural Prepayments/Supplemental                                          
 RAP..........................          13,070,160           13,462,265 
Rural Housing Vouchers........         144,200,000         148,526,000  
                               -----------------------------------------
      Rural housing total.....       4,197,424,733       4,312,747,475  
                               =========================================
      TITLE VI--COMMUNITY                                               
          DEVELOPMENT                                                   
                                                                        
Community Development Block                                             
 Grants (CDBG)................       4,532,000,000        4,667,960,000 
Section 108 Loan Guarantees...      (2,115,620,000)      (2,179,088,600)
Special Purpose/Projects                                                
 Grants.......................         (60,000,000)         (60,000,000)
Insular Areas.................          (7,000,000)          (7,000,000)
Historically Black Colleges...          (6,500,000)          (6,500,000)
Community/University                                                    
 Partnership..................          (6,000,000)          (6,000,000)
Revitalization Prov...........          (6,000,000)          (6,000,000)
CDBG Work Study Program.......          (3,000,000)          (3,000,000)
CD Reallocations and Technical                                          
 Assistance...................          (Such sums)          (Such sums)
CD Mapping Provision..........          (Such sums)          (Such sums)
CD Community Planning                                                   
 Adjustments..................          (Such sums)          (Such sums)
CDBG Redevelopment Provision..          (2,000,000)          (2,000,000)
Neighborhood Reinvestment                                               
 Corp.........................          32,960,000           33,948,800 
Neighborhood Development Demo.           5,000,000           5,150,000  
                               -----------------------------------------
      Title VI total..........       4,569,960,000       4,707,058,800  
                               =========================================
   TITLE VII--REGULATORY AND                                            
    MISCELLANEOUS PROGRAMS                                              
                                                                        
Fair Housing Initiatives                                                
 Program (FHIP)...............          26,780,000           27,583,400 
HUD Monitoring and Evaluation.           Such sums            Such sums 
HUD Salaries and Expenses.....       1,150,000,000        1,184,500,000 
HUD Research and Development..          36,050,000           37,131,500 
NIBS..........................           2,000,000            2,000,000 
Lead-Based Paint Provisions...         257,500,000          265,225,000 
New Towns Demonstration.......           Such sums            Such sums 
Solar Bank....................          10,732,600           11,054,578 
NAIHC.........................           1,000,000            1,030,000 
Housing Assistance Council....           5,000,000           5,150,000  
                               -----------------------------------------
      Title VII total.........       1,489,062,600       1,533,674,478  
                               =========================================
 TITLE VIII--McKINNEY HOMELESS                                          
           PROGRAMS                                                     
                                                                        
Emergency Shelter Grants......         150,000,000          154,500,000 
Supportive Housing/                                                     
 Transitional Program.........         344,020,000          354,340,600 
Safe Havens...................          66,542,120           68,538,384 
Section 8 Assistance for SRO's         200,000,000          206,000,000 
Shelter Plus Care Program.....         150,000,000          154,500,000 
Rural Homeless Grants.........          32,197,800           33,163,734 
Innovative Homeless Program...         206,000,000          212,180,000 
Interagency Council on the                                              
 Homeless.....................           1,609,890            1,658,187 
FEMA Food and Shelter Program.         193,186,800         198,982,404  
                               -----------------------------------------
      Title VIII total........       1,343,556,610       1,383,863,308  
                               =========================================
      Grand total.............      29,573,008,234       30,435,920,196 
HUD housing programs (Without                                           
 FmHA Rural Housing Programs).      25,375,583,501      26,123,172,721  
------------------------------------------------------------------------

                                                     

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