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84 STAT. 1787

DEMONSTRATIONS WITH RESPECT TO ABANDONED PROPERTIES

Grants,

Conditions.

Sec. 505. (a) In carrying out activities under section 501, the Secretary may undertake programs to demonstrate the most feasible means of providing assistance to localities in which a substantial number of structures are abandoned or are threatened with abandonment for the purpose of arresting the process of housing abandonment in its incipiency or in restoring viability to blighted areas in which abandonment is pervasive. For this purpose, the Secretary is authorized to make grants, subject to the limitations of this section, to assist local public bodies in planning and implementing demonstration projects for prompt and effective action in alleviating and preventing such abandonment in designated demonstration areas.

(b) In administering this section, the Secretary shall give preference to those demonstration projects which in his judgment can reasonably be expected to arrest the process of abandonment in the demonstration area within a period of two years and which provide for innovative approaches to combating the problem of housing abandonment. Such projects may include, but shall not be limited to (1) acquisition by negotiated purchase, lease, receivership, tax lien proceedings, or other means authorized by law and satisfactory to the Secretary, of real property within the demonstration area or areas which is abandoned, deteriorated, or in violation of applicable code standards; (2) the repair of streets, sidewalks, parks, playgrounds, publicly owned utilities, public buildings to meet needs consistent with the revitalization and continued use of the area; (3) the demolition of structures determined to be structurally unsound or unfit for human habitation or which contribute adversely to the physical or social environment of the locality involved; (4) the estabằishment of recreational or community facilities including public playgrounds; (5) the improvement of garbage and trash collection, street cleaning and other essential services necessary to the revitalization and maintenance of the area; (6) the rehabilitation of privately and publicly owned real property by the locality; and (7) the establishment and operation of locally controlled, nonprofit housing management corporations and municipal repair programs.

(c) Subject to such conditions as the Secretary may prescribe, real property held as part of a project assisted under this section may be made available to (1) a limited dividend corporation, nonprofit corporation, or association, cooperative or public body or agency, or other approved purchaser or lessee, or (2) a purchaser who would be eligible for a mortgage insured under section 221 (d) (3) or (d) (4), section 221 (h) (1), section 235 (i) or (j) (1), or section 236 of the National Housing Act, for purchase or lease at fair market value for use by such purchaser or lessee, as, or in the provision of, new or rehabilivated housing for occupancy by families or individuals of low or moderate income.

(d) Grants under this section shall be in amounts which do not exceed 90 per centum of the net project cost as determined by the Secretary. There are authorized to be appropriated for demonstration grants under this section not to exceed $20,000,000 for the fiscal year ending June 30, 1971. Any amounts appropriated shall remain available until expended and any amount authorized but not appropriated may be appropriated for any succeeding fiscal year commencing prior to July 1, 1972. Not more than one-third of the aggregate amount of grants made in any fiscal year under this section shall be made with respect to projects undertaken by one locality.

(e) The provisions of sections 106, 114, and 115 of Title I of the Housing Act of 1949, and section 312 of the Housing Act of 1964, may

68 Stat, 601;
80 Stat. 1268.
12 USC 17151.
82 Stat. 477,
498.
12 USC 17152,
17152-1.
Appropriation,

42 USC 1456, 1465, 1466. 42 USC 1452b.

.

84 STAT. 1788 apply to projects assisted under this Act as if such projects were being carried out in urban renewal areas as part of urban renewal projects within the meaning of section 110 of the Housing Act of 1949.

68 Stat, 626. (f) The Secretary shall report annually to the Congress with 42 USC 1460. respect to the status of demonstration projects funded by him and shall Report to make such recommendations to the Congress as he deems necessary to Congress, further the purposes of this section.

TITLE VI—CRIME INSURANCE

FINDINGS AND PURPOSE

SEC. 601. Section 1102(b) of the Housing and Urban Development Act of 1968 is amended by striking out Wand" immediately before 82 Stat. 556. “(2)", and by inserting before the period at the end thereof the fol- 12 USC 1749bbb lowing: "; and (3) provide direct insurance through the facilities of note. the Federal Government in the case of properties for which statewide programs and the Federal reinsurance program either do not make crime insurance available or offer such insurance to property owners only at prohibitive cost”.

AMENDMENTS TO TITLE XII OF THE NATIONAL HOUSING ACT

9.

SEO. 602. (a) Section 1201 of the National Housing Act is amended 12 USC 1749bbb. to read as follows:

“PROGRAM AUTHORITY “Sec. 1201. (a) The Secretary is authorized to establish and carry out the programs provided for in parts A, B, C, and D of this title. “(b) (1) The powers of the Secretary under this title shall terminate

( on April 30, 1975, except to the extent necessary

“(A) to continue reinsurance and direct insurance in accordance with the provisions of sections 1223(b) and 1231(c) until 12 USC 1749bbbApril 30, 1978;

"(B) to process, verify, and pay claims for reinsured losses and 12 USC 1749bbbdirectly insured losses and perform other necessary functions in 11. connection therewith; and

“(C) to complete the liquidation and termination of the reinsurance and direct insurance programs. “(2) On April 30, 1978, or as soon thereafter as possible, the Secretary shall submit to the Congress, for its approval, a plan for the liquidation and termination of the reinsurance and direct insurance programs."

(b) Section 1203(a) of such Act is amended by redesignating para- Definitions. graphs (1) through (13) as paragraphs (4) through (16), respec- 12 USC 1749bbbtively, and by inserting immediately after and below "the term—” 2. the following new paragraphs:

“(1) affordable rate' means such premium rate as the Secretary determines would permit the purchase of a specific type of insurance coverage by a reasonably prudent person in similar circumstances with due regard to the costs and benefits involved;

“(2) 'crime insurance' means insurance against losses resulting from robbery, burglary, larceny, and similar crimes, and may include broad form personal theft insurance, mercantile open stock insurance, mercantile robbery and mercantile safe barglary insurance, storekeepers burglary and robbery insurance, office burglary and robbery insurance, and may include business interruption insurance as the Secretary may designate; the term does not include automobile insurance or losses resulting from embezzlement;

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84 STAT, 1789

*(3) 'directly insured losses' means losses on direct insurance claims and all direct expenses incurred in connection therewith, including but not limited to expenses for processing, verifying,

and paying such losses;”. 82 Stat. 560. (c) Section 1221 (a) (2) of such Act is amended by striking out "sec12 USC 1749bbb- tion 1203(a) (10)” each place it appears and inserting in lieu thereof 7.

"section 1203 (a) (13)”. 12 USC 1749bbb- (d) Title XII of such Act is amended by redesignating part C and 11.

sections 1231 through 1241 as part D and sections 1241 through 1251, respectively, and by inserting after part B the following new part:

“Purt C-FEDERAL INSURANCE AGAINST BURGLARY AND THEFT

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"SEC. 1231. (a) The Secretary shall conduct a continuing review of the market availability situation in each of the several States to determine whether crime insurance is available at affordable rates either through the normal insurance market or through a suitable program adopted under State law.

"(b) Upon determining pursuant to subsection (a) that, at any time on or after August 1, 1971, a critical market unavailability situation for crime insurance then exists in any State and has not been met through appropriate State action, the Secretary is authorized to make crime insurance available at affordable rates within such State through the facilities of the Federal Government. Such insurance shall be provided upon such terms and conditions, and subject to such deductibses and other restrictions and limitations, as the Secretary deems appropriate, but no such insurance shall be made available to a property which the Secretary determines to be uninsurable or to a property with respect to which reasonable protective measures to prevent loss, consistent with standards established by the Secretary, have not been adopted.

"(c) Notwithstanding any other provision of this title, direct insurance may be continued for the term of the policies written prior to the date of termination of the Secretary's direct insurance authority under this part, for as long as the insured pays the required direct insurance premiums; except that direct insurance under this part for any risk shall be terminated after notice whenever the Secretary determines that the standard lines of crime insurance otherwise have become available to such property at affordable rates.

"USE OF EXISTING FACILITIES AND SERVICES "Sec. 1232. In carrying out his responsibilities under this part, the Secretary may utilize

"(1) insurance companies and other insurers, insurance agents and brokers, and insurance adjustment organizations, as fiscal agents of the United States,

"(2) officers and employees of the Department of Housing and Urban Development, and such other officers and employees of any executive agency (as defined in section 105 of title 5 of the United States Code) as the Secretary and the head of any such agency may from time to time agree upon, on a reimbursement or other basis, or

"(3) both the alternatives specified in paragraphs (1) and (2), or any combination thereof.

80 Stat. 379.

84 STAT. 1790

"ESTABLISHMENT OF AFFORDABLE RATES

“Sec. 1233. In estimating the affordable rates for the various crime insurance coverages offered from time to time under this part, the Secretary shall consult with appropriate State insurance authorities and other knowledgeable persons and is authorized to take into consideration the nature and degree of the risks involved, the protective devices employed, the extent of anticipated losses, the prevailing rates for similar coverages in adjacent or comparable areas and territories, the economic importance of the various individual coverages and the type of property involved, and the relative abilities of the particular classes and types of insureds to pay the full estimated costs of such coverages. Nothing in this section shall be construed to prohibit or require either the adoption of uniform national rates or the periodic modification of currently estimated affordable rates for any particular line or subline of coverage, class, State, territory, or risk on the basis of additional information or actual loss experience.

“REPORTS OX OPERATIONS

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"Sec. 1234. The Secretary shall include in his reports to the Con- Reports to gress on the program authorized by this title full and complete Congress. information on his operations and activities under this part, together with such recommendations with respect thereto as he may

deem appropriate."

(e) Section 1222(a) of such Act is amended by striking out "section 82 Stat, 561. 1233” and inserting in lieu thereof "section 1243".

12 USC 1749bbb(f) Section 1244 (c) of such Act (as redesignated by subsection (d) 3. of this section) is amended by striking out “section 1232" and insert- 12 USC 1749bbbm ing in lieu thereof "section 1242”.

14. (g) Section 1241 (a) of such Act (as so redesignated) is amended 12 USC 1749bbbby inserting "or direct insurance" after "reinsurance", and by insert- 11. ing “or property owners" after “insurers”.

(h) Section 1241 (b) of such Act (as so redesignated) is amended by inserting "or direct insurance" after "reinsurance”. (i) Section 1242 (a) of such Act (as so redesignated) is amended- 12 USC 1749bbb

(1) by striking out “the reinsurance program" and inserting 12. in lieu thereof “the reinsurance and direct insurance programs

(2) by inserting “or direct insurance” after “reinsurance” in paragraphs (1), (2), and (4);

(3) by inserting "or property owner" after "any insurer" where it first appears in paragraph (4); and

(4) by inserting “or directly insured” after "reinsured” in paragraph (4). (j) Section 1243 of such Act (as so redesignated) is amended

(1) by inserting and direct insurance” after “reinsurance” in 13. subsection (a)(1) and each place it appears in subsection (b) (1);

(2) by striking out "part B” in subsection (b)(1) and inserting in lieu thereof “parts B and C”; and

(3) by redesignating clauses (4) and (5) of subsection (b) as clauses (5) and (6), and inserting after clause (3) a new clause as follows:

“(4) such amounts which are hereby authorized to be appropriated as may be necessary from time to time to reimburse the fund for losses and expenses (including administrative expenses) incurred in carrying out the program authorized under part C;".

12 USC 1749bbb

84 STAT. 1791 82 Stat. 565. (k) Section 1244(a) of such Act (as so redesignated) is amended 12 USC 1749bbb- by striking out “Any insurer or pool acquiring reinsurance” and

inserting in lieu thereof “Any insurer, pool, or property owner acquiring reinsurance or direct insurance”.

(1) Section 1244 (c) of such Act (as so redesignated) is amended by inserting“or direct insurance” after “reinsurance”.

146

REVIEW OF STATEWIDE PLANS

82 Stat. 556. Sec. 603. Title XII of the National Housing Act is amended by 12 USC 1749bbb. inserting after section 1214 a new section as follows:

"OFFICE OF REVIEW AND COMPLIANCE

"SEC. 1215. The Secretary, through an Office of Review and Compliance under the Federal Insurance Administrator, shall periodically review each plan under this part and the methods and practices by which such plan is being actually carried out in the areas and communities where it is intended to operate, in order to assure that such plan is effectively making essential property insurance readily available in such areas and communities and is otherwise carrying out the purposes of this title, and in order to identify any aspects of the operation or administration of such plan which may require revision, modification, or other action to carry out such purposes."

CONFORMING AMENDMENT

79 Stat, 473; 82 Stat. 586. 12 USC 1735d.

Sec. 604. Clause (2) of the first sentence of section 520 (b) of the National Housing Act is amended by inserting "and directly insured” after“reinsured wherever it appears.

TITLE VII-URBAN GROWTH AND NEW COMMUNITY

DEVELOPMENT

SHORT TITLE. AND STATEMENT OF PURPOSE

Citation of title.

Sec. 701. (a) This title may be cited as the “Urban Growth and New Community Development Act of 1970".

(b) It is the policy of the Congress and the purpose of this title to provide for the development of a national urban growth policy and to encourage the rational, orderly, efficient, and economic growth, development, and redevelopment of our States, metropolitan areas, cities, counties, towns, and communities in predominantly rural areas which demonstrate a special potential for accelerated growth; to encourage the prudent use and conservation of our natural resources; and to encourage and support development which will assure our communities of adequate tax bases, community services, job opportunities, and well-balanced neighborhoods in socially, economically, and physically attractive living environments.

Part A-DEVELOPMENT OF A NATIONAL URBAN GROWTH POLICY

FINDINGS AND DECLARATION OF POLICY

Sec. 702. (a) The Congress finds that the rapid growth of urban population and uneven expansion of urban development in the United States, together with a decline in farm population, slower growth in rural areas, and migration to the cities, has created an imbalance between the Nation's needs and resources and seriously threatens our physical environment, and that the economic and social development

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