[Congressional Record Volume 141, Number 141 (Tuesday, September 12, 1995)]
[Extensions of Remarks]
[Page E1755]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



               E X T E N S I O N S   O F   R E M A R K S


[[Page E 1755]]


  COMMUNITY DEVELOPMENT BLOCK GRANT DIRECT HOME OWNERSHIP ASSISTANCE 
                             EXTENSION ACT

                                 ______


                           HON. PATSY T. MINK

                               of hawaii

                    in the house of representatives

                       Tuesday, September 12, 1995
  Mrs. MINK of Hawaii. Mr. Speaker, the Community Development Block 
Grant [CDBG] Direct Home Ownership Assistance Program will expire at 
the end of the current fiscal year, leaving numerous communities 
nationwide at a great loss. For this reason, I have introduced the CDBG 
Direct Home Ownership Assistance Extension Act which would prolong the 
duration of this program another year, to end in fiscal year 1996.
  The National Affordable Housing Act [NAHA] in 1990 amended CDBG 
legislation to remove direct home ownership assistance from the public 
service category and establish it as a separate entity. A sunset clause 
in the NAHA legislation would have terminated the program on October 1, 
1993; however, due to apparent need for the program, the 1992 Housing 
and Community Development Act further extended the provision through 
October 1, 1994. The 1992 legislation also authorized the Secretary of 
Housing and Urban Development [HUD] to extend the program 1 additional 
year through fiscal year 1995, which he did on September 30, 1994.
  Program extension is even more crucial at this point, months after 
HUD released its national home ownership strategy in partnership with 
groups including the American Bankers Association and Federal National 
Mortgage Corp. The strategy aims to increase the national home 
ownership rate to 67.5 from 64 percent in 5 years--adding up to 8 
million new families to home ownership rolls in the United States by 
end of the year 2000--without adding new Government spending. Direct 
home ownership assistance is an ideal component of this strategy.
  Direct home ownership assistance is crucial for my State of Hawaii as 
a whole, considering that its rate of home ownership is a mere 53.5 
percent. The median price of an existing home in the United States in 
1994 registered at $109,000, while the median price for an Oahu home 
was $360,000.
  Unique circumstances surround the County of Kauai in my district, 
which continues to recover from devastating effects of Hurricane Iniki, 
1992. The Kauai County Housing Agency has been planning to put all 
$140,000 of its fiscal year 1995 CDBG funds into direct home ownership 
assistance and desperately needs this program to continue. The single-
family house price for Kauai County in September 1994 was $311,632. In 
addition, as defined by HUD, 44 percent of Kauai's resident households 
are considered to fall below 80 percent of the median income level. 
These factors present a significant proportion of Kauai's families with 
only bleak possibilities at home ownership.
  Despite Kauai's high-housing prices and low-income levels, the desire 
for home ownership still remains notable. According to the county, 66 
percent of the households who will eventually move from their current 
place of residence wish to become homeowners. However, 17 percent of 
these households have less than $5,000 for down payment purposes. Many 
families in Kauai County are presented with little or no opportunity to 
achieve the American dream. Direct home ownership assistance would help 
at least some of these families.
  On the national level, according to HUD's latest CDBG performance 
reports--compiled for the 1992 program year--143 communities used 
approximately $18.2 million for 247 activities under direct home 
ownership assistance--which is available for all States. Municipalities 
which have benefited substantially from the program in fiscal year 1995 
include Boston, $1.6 million; Cambridge, $237,811; and Springfield, MA, 
$920,400; Kansas City, MO, $2.4 million; Johnson City, TN, $240,225; 
and Lakeland, FL, $135,000.
  Direct home ownership assistance is a valuable program that increases 
user flexibility without contributing more to CDBG costs. It provides 
needy communities with an alternative to housing assistance under HOME 
investment partnership grants. Many communities, such as Kauai, have 
incorporated this program into 1995 CDBG plans and would be forced to 
extensively reporgram funds should this program expire.
  I strongly urge my colleagues to support the CDBG Direct 
Homeownership Assistance Extension Act.


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