the loan contract and shall be incontestable in the hands of a bearer and the full faith and credit of the United States is pledged to the payment of all amounts agreed to be paid by the Administrator pursuant to this subsection.

(d) The Administrator may make advances of funds to local public agencies for surveys1 of urban areas to determine whether the undertaking of urban renewal projects therein may be feasible and for surveys and plans for urban renewal projects which may be assisted under this title, including, but not limited to, (i) plans for carrying out a program of voluntary repair and rehabilitation of buildings and improvements, (ii) plans for the enforcement of State and local laws, codes, and regulations relating to the use of land and the use and occupancy of buildings and improvements, and to the compulsory repair, rehabilitation, demolition, or removal of buildings and improvements, and (iii) appraisals, title searches, and other preliminary work necessary to prepare for the acquisition of land in connection with the undertaking of such projects. The contract for any such advance of funds shall be made upon the condition that such advance of funds shall be repaid, with interest at not less than the applicable going Federal rate, out of any moneys which become available to the local public agency for the undertaking of the project involved. No contract for any such advances of funds for surveys and plans for urban renewal projects which may be assisted under this title shall be made unless the governing body of the locality involved has by resolution or ordinance approved the undertaking of such surveys and plans and the submission by the local public agency of an application for such advance of funds. Notwithstanding 2 section 110 (h) or the use in any other provision of this title of the term "local public agency" or "local public agencies" the Administrator may make advances of funds under this subsection for surveys and plans for an urban renewal project (including General Neighborhood Renewal Plans as hereinafter defined) to a single local public body which has the authority to undertake and carry out a substantial portion, as determined by the Administrator, of the surveys and plans or the project respecting which such surveys and plans are to be made: Provided, That the application for such advances shows, to the satisfaction of the Administrator, that the filing thereof has been approved by the public body or bodies authorized to undertake the other portions of the surveys and plans or of the project which the applicant is not authorized to undertake. In order to facilitate proper preliminary planning for the attainment of the urban renewal objectives of this title, the Administrator

3

1 Sec. 303(b), Housing Act of 1956, Public Law 1020, 84th Congress, approved August 7. 1956, 70 Stat. 1091, 1100, inserted the language authorizing advances for surveys of urban areas to determine whether the undertaking of urban renewal projects in the areas may be feasible.

This sentence added by sec 301, Housing Act of 1956, Public Law 1020, 84th Congress, approved August 7, 1956, 70 Stat. 1091, 1097.

3 Sec. 303, Housing and Urban Development Act of 1965, Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 475, amended the first sentence of this paragraph to (1) eliminate the requirement that the whole area covered by the general neighborhood renewal plan be an urban renewal area, and (2) to permit urban renewal projects undertaken in general neighborhood renewal plan areas to be initiated within a maximum of eight years rather than ten years.

Remaining provisions in this subsection added by sec. 303(a), Housing Act of 1956, Public Law 1020, 84th Congress, approved August 7, 1956, 70 Stat. 1091, 1099. However, a technical amendment was made by sec. 303 of the Housing and Urban Development Act of 1965 in the language in paragraph numbered (1) in order to conform that language to the amendment described in the first paragraph of this footnote 3.

may also make advances of funds (in addition to those authorized above) to local public agencies for the preparation of General Neighborhood Renewal Plans (as herein defined). A General Neighborhood Renewal Plan may be prepared for an area consisting of an urban renewal area or areas, together with any adjoining areas having specially related problems, and which is of such size that the urban renewal activities in the urban renewal area or areas may have to be initiated in stages, consistent with the capacity and resources of the respective local public agency or agencies, over an estimated period of not more than eight years.

No contract for advances for the preparation of a General Neighborhood Renewal Plan may be made unless the Administrator has determined that:

(1) in the interest of sound community planning, it is desirable that the urban renewal activities proposed for the area be planned in their entirety;

(2) the local public agency proposes to undertake promptly an urban renewal project embracing at least 10 per centum of such area, upon completion of the General Neighborhood Renewal Plan and the preparation of an urban renewal plan for such project; and

(3) the governing body of the locality has by resolution or ordinance (i) approved the undertaking of the General Neighborhood Renewal Plan and the submission of an application for such advance and (ii) represented that such plan will be used to the fullest extent feasible as a guide for the provision of public improvements in such area and that the plan will be considered in formulating codes and other regulatory measures affecting property in the area and in undertaking other local governmental activities pertaining to the development, redevelopment, rehabilitation, and conservation of the area.

The contract for any such advance of funds for a General Neighborhood Renewal Plan shall be made upon the condition that such advance shall be repaid, with interest at not less than the applicable going Federal rate, out of any moneys which become available to the local public agency for the undertaking of the first urban renewal project in such area: Provided, That in the event of the undertaking of any other project or projects in such area an appropriate allocation of the amount of the advance, with interest, may be effected to the end that each such project may bear its proper allocable part, as determined by the Administrator, of the cost of the General Neighborhood Renewal Plan. As used herein, a General Neighborhood Renewal Plan means a preliminary plan (conforming in the determination of the governing body of the locality, to the general plan of the locality as a whole and to the workable program of the community meeting the requirements of section 101) which outlines the urban renewal activities proposed for the area involved, provides a framework for the preparation of urban renewal plans and indicates generally, to the extent feasible in preliminary planning, the land uses, population density, building coverage, prospective requirements for rehabilitation and improvement of property, and any portions of the area contemplated for clearance and redevelopment.

1

(e) The total amount of loan contracts outstanding at any one time under this title shall not exceed the aggregate of the estimated expenditures to be made by local public agencies as part of the gross project cost of the projects assisted by such contracts. To obtain funds for advance and loan disbursements under this title, the Administrator may issue and have outstanding at any one time notes and obligations for purchase by the Secretary of the Treasury in an amount which shall not, unless authorized by the President exceed $1,000,000,000. For the purpose of establishing unpaid obligations as of a given date against the authorization contained in the preceding sentence, the Administrator shall estimate the maximum amount to be required to be borrowed from the Treasury and outstanding at any one time with respect to loan commitments in effect on such date. (f) Notes or other obligations issued by the Administrator under this title shall be in such forms and denominations, have such maturities, and be subject to such terms and conditions as may be prescribed by the Administrator, with the approval of the Secretary of the Treasury. Such notes or other obligations shall bear interest at a rate determined by the Secretary of the Treasury, taking into consideration the current average rate on outstanding marketable obligations of the United States as of the last day of the month preceding the issuance of such notes or other obligations. The Secretary of the Treasury is authorized and directed to purchase any notes and other obligations of the Administrator issued under this title and for such purpose is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under the Second Liberty Bond Act, as amended, and the purposes for which securities may be issued under such Act, as amended, are extended to include any purchases of such notes and other obligations. The Secretary of the Treasury may at any time sell any of the notes or other obligations acquired by him under this section. All redemptions, purchases, and sales by the Secretary of the Treasury of such notes or other obligations shall be treated as public debt transactions of the United States.

(g) Obligations, including interest thereon, issued by local public agencies for projects assisted pursuant to this title, and income derived by such agencies from such projects, shall be exempt from all taxation now or hereafter imposed by the United States.

CAPITAL GRANTS

SEC. 103. (a) (1) The Administrator may make capital grants to local public agencies in accordance with the provisions of this title for urban renewal projects: Provided, That the Administrator shall not

1 Immediately prior to amendment by sec. 404, Housing Act of 1959, Public Law 86-372, approved September 23, 1959, 73 Stat. 654, 671, this subsection read as follows:

(e) To obtain funds for loans under this title, the Administrator, on and after July 1, 1949, may, with the approval of the President, issue and have outstanding at any one time notes and obligations for purchase by the Secretary of the Treasury in an amount not to exceed $25,000.000, which limit on such outstanding amount shall be increased by $225,000,000 on July 1, 1950, and by further amounts of $250,000,000 on July 1 in each of the years 1951, and 1952, and 1953, respectively: Provided, That (subject to the total authorization of not to exceed $1,000,000,000) such limit, and any such authorized increase therein, may be increased, at any time or times, by additional amounts aggregating not more than $250,000,000 upon a determination by the President, after receiving advice from the Council of Economic Advisers as to the general effect of such increase upon the conditions in the building industry and upon the national economy, that such action is in the public interest."

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make any contract for capital grant with respect to a project which consists of open land.

(2) The aggregate of such capital grants with respect to all of the projects of a local public agency (or of two or more local public agencies in the same municipality) on which contracts for capital grants have been made under this title shall not exceed the total of—

(A) two-thirds of the aggregate net project costs of all such projects to which neither subparagraph (B) nor subparagraph (C) applies, and

(B)2 three-fourths of the aggregate net project costs of any such projects which are located in (i) a municipality having a population of fifty thousand or less according to the most recent decennial census, or (ii) a municipality situated in a labor market area which, at the time the contract or contracts involved are entered into or at such earlier time as the Administrator may specify in order to avoid hardship, or 3 at any time after such contract or contracts are entered into and prior to the time the final grant payment has been made pursuant thereto, is designated as a redevelopment area under the second sentence of section 5(a) of the Area Redevelopment Act or any other legislation enacted after the date of the enactment of the Housing and Urban Development Act of 1965 containing standards for designation as a redevelopment area generally comparable to those set forth in the second sentence of section 5 (a) of the Area Development Act, and

(C) three-fourths of the aggregate net project costs of any of such projects (not falling within subparagraph (B)) which the Administrator, upon request, may approve on a three-fourths capital grant basis.

(3) A capital grant with respect to any individual project shall not exceed the difference between the net project cost and the local grantsin-aid actually made with respect to the project.

(b) The Administrator may, with the approval of the President,5 contract to make grants under this title aggregating not to exceed

1 Immediately prior to amendment by sec. 301(a), Housing Act of 1961, Public Law 87-70, approved June 30, 1961, 75 Stat. 149, 165, the balance of this subsection read as follows: "The aggregate of such capital grants with respect to all the projects of a local public agency on which contracts for capital grants have been made under this title, exclusive of projects referred to in the proviso hereto, shall not exceed two-thirds of the aggregate of the net project costs of such nonexcluded projects: Provided, That the aggregate of such capital grants may exceed two-thirds but not three-fourths of the aggregate net project costs of those projects which the Administrator, at the request of a local public agency, may approve on such a three-fourths capital grant basis. A capital grant with respect to any individual project shall not exceed the difference between the net project cost and the local grants-in-aid actually made with respect to the project."

2 Sec. 313, Housing and Urban Development Act of 1965, Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 479, amended this subparagraph (B) to remove the 150,000 population limitation for three-fourths grants for urban renewal projects located in areas designated as redevelopment areas under sec. 401 (a) of the Public Works and Economic Development Act of 1965 (which superseded the Area Redevelopment Act) with respect to all such projects placed under contract for capital grants after the date of the enactment of the Housing and Urban Development Act of 1965 (August 10, 1965).

3 Sec. 704, Demonstration Cities and Metropolitan Development Act of 1966. Public Law 89-754, approved November 3, 1966, 80 Stat. 1255, 1281, inserted "or at any time after such contract or contracts are entered into and prior to the time the final grant payment has been made pursuant thereto.".

The Area Redevelopment Act was superseded by the Public Works and Economic Development Act of 1965. Public Law 89-136, 79 Stat. 552, 42 U.S.C. 3121.

5 Executive Order 11196, empowered the Administrator to perform this function without the approval. ratification, or other action of the President.

Sec. 605(h). Demonstration Cities and Metropolitan Development Act of 1966, Public Law 89-754, approved November 3, 1966, 80 Stat. 1255, 1280, provides that no grants for historic preservation may be made under the urban renewal program, beginning 3 years after the date of enactment of this Act, except for activities in accord with criteria which the Secretary of Housing and Urban Development establishes as comparable to those used in connection with the National Register maintained by the Secretary of the Interior.

$4,700,000,000,1 which amount shall be increased by $675,000,000 on the date of the enactment of the Housing and Urban Development Act of 1965, by $725,000,000 on July 1, 1966, and by $750,000,000 on July 1 in each of the years 1967 and 1968. In addition to the authority to make grants provided in the first sentence of this subsection, the Secretary may contract to make grants under this title, on or after July 1, 1967, in an amount not to exceed $250,000,000: Provided, That the authority to contract to make grants provided by this sentence shall be exercised only with respect to an urban renewal project which is identified and scheduled to be carried out as one of the projects or activities included within an approved comprehensive city demonstration program assisted under the provisions of section 105 (c) of the Demonstration Cities and Metropolitan Development Act of 1966.3 Such grants shall not be used for major long-term capital improvement; shall not exceed two-thirds of the cost, as determined or estimated by the Administrator, of the project for which the grant is made; and shall be subject to such other terms and conditions as he may prescribe. The Administrator is authorized, notwithstanding the provisions of section 3648 of the Revised Statutes, as amended, to make advance or progress payments on account of any grant contracted to be made pursuant to this section. The faith of the United States is solemnly pledged to the payment of all grants contracted for under this title, and there are hereby authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, the amounts necessary to provide for such payments: Provided, That any amounts so appropriated shall also be available for repaying to the Secretary of the Treasury, for application to notes of the Administrator, the principal amounts of any funds advanced to local public agencies under this title which the Administrator determines to be uncollectible because of the termination of activities for which such advances were made, together with the interest paid or accrued to the Secretary (as determined by him) attributable to notes given by the Administrator in connection with such advances, but all such repayments shall constitute a charge against the authorization to make contracts for grants contained in this section: Provided further, That no such determination of the Administrator shall be construed to prejudice the rights of the United States with respect to any such advance.

(c) Notwithstanding any other provision of this or any other Act, if financial assistance authorized by this title to be made available to a locality or local public agency may be made available to any locality or local public agency within the limitations provided in sections 102(e), 103(b), and 106(e), and the second paragraph following the

1 Sec. 304, Housing and Urban Development Act of 1965, Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 475, substituted "$4,700,000,000" for "$4,725,000,000", added the further increases in this sentence, and deleted the proviso that immediately followed "$4,725,000,000" that authorized the use of $25,000,000 of the urban renewal grant authorization for demonstration grants under the urban mass transportation program. The $25,000.000 reduction reflects the deletion of that proviso.

The Independent Offices Appropriation Act, 1966, Public Law 89-128, 79 Stat. 520, 532, and the Supplemental Appropriation Act, 1966, Public Law 89-309, 79 Stat. 1133, 1136, placed dollar limits on the aggregate amounts of contracts for grants that can be entered into during fiscal years 1966 and 1967 (see excerpts from these acts, infra).

2 Sec. 113, Demonstration Cities and Metropolitan Development Act of 1966, Public Law 89-754, approved November 3, 1966, 80 Stat. 1255, 1260, added this sentence. 3 See supra.

Added by sec. 405 (3), Housing Act of 1959, Public Law 86-372, approved September 23, 1959, 73 Stat. 654, 672.