90

26

26

9.7

9.7

$9,355

$9,879

9.7 $9,921

2278

FARMERS HOME ADMINISTRATION

General and special funds:

RURAL HOUSING GRANTS AND LOANS

For grants and loans for the purposes of section 504 of the Housing Act of 1949, as amended (42 U.S.C. 1474), $10,000,000, to remain available until expended. (Additional authorizing legislation to be proposed.)

Expenditures..

-6,794 -1,794 130,578 146,090 41,850

1 Selected resources as of June 30 are as follows: Unpaid undelivered orders. 1963, $5.491 thousand (1963 adjustment. - $981 thousand): 1964, $9,574 thousand; 1965, $7,184 thousand; 1966, $2,184 thousand.

Rural housing direct loans are authorized by title V of the Housing Act of 1949, as amended, to be made to farm and non-farmowners of real estate in rural areas, to longterm farm leaseholders, and to senior citizens who are or will be owners of land in rural areas. Loans are made only to persons unable to obtain housing credit from other sources upon reasonable terms and conditions. Direct loans to individuals are repayable in not more than 33 years and bear interest at 4%. Grants are made for minor building repair. In addition to the direct loans and grants, insured loans are made to provide housing for

domestic farm labor, and to provide rental housing for senior citizens in rural areas.

1. Rural housing grants and loans.-Direct farm enlargement and development loans, along with building loans, are made to farmowners on potentially adequate farms who need to develop their farms so as to increase their income sufficiently to repay the loans. Grants are made to farmowners, to owners of other real estate and long-term farm leaseholders in rural areas for such items as repairing roofs, providing sanitary facilities, providing an adequate sanitary water supply, and supplying screens. In some cases, a combination building loan and grant is made. A building loan or grant or a combination loan and grant may not exceed $1 thousand.

2. Loans to the elderly.-Direct building loans are made to senior citizens for the same purposes as building loans described below, provided they own land or can buy a small tract in a rural area with loan funds.

3. Building loans.-Direct building loans are made to farmowners, to owners of other real estate in rural areas, and to long-term farm leaseholders to construct, improve, alter, repair, or replace dwellings and essential farm-service buildings.

Insured housing loans.-Insured loans are made through the Agricultural Credit Insurance Fund utilizing funds

furnished by private investors. Annual payments of principal and interest to lenders are fully guaranteed. The Government retains at least one-half of 1% of the interest as an insurance premium.

A. Farm labor housing loans.--Insured farm labor housing loans are made to farmowners or to organizations to provide modest living and related facilities for domestic farm labor. These loans are repayable in not more than 33 years and bear interest not in excess of 5%. The law provides that lenders can receive up to 4%% of the 5% interest paid by the borrower. The maximum return to lenders is currently established at 41⁄2%.

B. Rental housing loans for senior citizens.-Insured loans to provide moderate-cost rental housing and related. facilities for senior citizens are made to individuals, corporations, associations, trusts or partnerships. These loans are repayable in the number of years best suited to the individual case with interest at 54% to the borrower. The Government retains at least one-half of 1% of the interest as an insurance premium. No loan may exceed $300 thousand.

Authority for funding rural housing grants and loan activities will expire on September 30, 1965, but extension will be proposed.

Financial assistance will be provided to public or private nonprofit organizations for low-rent housing and related facilities for domestic farm labor as authorized by the Housing Act of 1964.

Assistance, not to exceed two-thirds of the total development cost, will be provided for new structures and for rehabilitation, alteration, conversion or improvement to existing structures for dwelling use by domestic farm labor, and for new structures or repairing and remodeling existing structures for use as dining halls, community rooms or buildings, infirmaries, or other essential service facilities.

Authority for this program will expire on September 30, 1965, but extension will be proposed.

Rural renewal loans are repayable in not more than 30 years with repayment of principal and interest deferred up to 5 years, if necessary. Loans bear interest at the average rate paid by the U.S. Treasury on obligations of similar maturity. The rate for 1965 is 3.137%. Loans in excess of $250 thousand require approval of the Agriculture and Forestry Committees of the Congress.

Program administration.-The Farmers Home Administration has been assigned responsibility for the coordination, direction, and supervision of the rural renewal program. The principal administrative expenses are related to technical assistance, coordination of project. plans and loan programs by the Farmers Home Administration. These expenses are estimated at $223 thousand in 1965 and $450 thousand in 1966. Administrative expenses allotted to the Economic Research Service will be $27 thousand for 1965 and $50 thousand for 1966. Object Classification (in thousands of dollars)

247

250

247

1,750

3,000

Change in selected

Identification code

05-60-20030-1-352

1 Selected resources as of June 30 are as follows: Unpaid undelivered orders 1963, $0: 1964, $950 thousand; 1965, $400 thousand; 1966, $400 thousand.

This program was authorized by section 102 of the Food and Agriculture Act of 1962. Loans are made to local public agencies or groups for rural renewal development projects which are specifically related to conservation and Íand utilization. Each project will be an important component of the overall rural renewal plan previously developed to rebuild the economy of the designated area. To be eligible for designation as a rural renewal area, the locality must be one of chronic underemployment on farms and unemployment in the surrounding communities. The area must also be one in which agriculture or forestry contribute substantially to the economy. The 1966 request is to provide for continuation of program operation in five pilot project areas.

Program operations include selection and designation of rural renewal areas, technical assistance to local public bodies or officials, or organizations in the preparation of an economic development plan, and counsel to local agencies and groups for meeting legal requirements necessary for borrowing funds. The borrowing agency is designated by the State legislature or Governor to receive rural renewal loan funds and is vested with authority under State and local laws to borrow funds, buy and sell property, raise revenue, meet financial obligations and transact other necessary business functions.

This account was established pursuant to the Senior Citizens Housing Act of 1962. Loans are made under the authority of section 515(a) of title V of the Housing Act of 1949, as amended, to private nonprofit corporations and consumer cooperatives to provide modest cost rental housing and related facilities for elderly persons of low or moderate income in rural areas.

Direct loans, made from the revolving fund, are repayable in not more than 50 years and bear interest comparable to housing loans for the elderly in urban areas (currently 34%). Administrative expenses for this program are included under the appropriation item, Salaries and expenses, Farmers Home Administration.

Legislation for extending this program beyond September 30, 1965, will be proposed.

Revenue, Expense, and Retained Earnings (in thousands of dollars)

70

65

Relation of obligations to expenditures:

10

Total obligations...

200,000

Receipts and other offsets (items 11-17).

-160,000

71

tion.