Printed for the use of the Committee on Banking and Currency 97-600 O U.S. GOVERNMENT PRINTING OFFICE WASHINGTON: 1968 To the Members of the Committee on Banking and Currency: The Housing and Urban Development Act of 1968 is one of the most comprehensive and forward-looking measures ever enacted in the field of housing and urban development legislation. Its many provisions improve nearly every one of the existing Federal programs in this field and it contains many new and imaginative approaches toward the further realization of the national commitment to achieve "the goal of a decent home and a suitable living environment for every American family." The 17 titles of the bill touch on virtually every major problem in the field of housing and urban development that falls within this committee's jurisdiction. This legislation is the result of more than a year of intensive congressional studies and many weeks of hearings and consideration in executive session. This summary lists the major features of the act and includes a detailed section-by-section analysis. Sincerely, (III) WRIGHT PATMAN, Chairman. MAJOR FEATURES OF THE HOUSING AND URBAN DEVELOPMENT ACT OF 1968 Aids for homeownership and rental housing It authorizes new programs of subsidies to reduce mortgage interest rates on behalf of lower income families to as low as 1 percent in order to assist them in purchasing or renting new or existing housing which they could not otherwise afford. Eligibility to participate in this program is limited to families whose incomes do not exceed 135 percent of the incomes set for admission to low-rent public housing in the area, except that 20 percent of the funds for this program may be used for families with higher incomes which do not exceed 90 percent of the limits for 221(d) (3) below market interest rate housing. A deduction of $300 per child is permitted in determining family income. It also provides substantially increased funding for the existing public housing and rent supplement programs. Liberalized FHA financing It establishes a special high-risk insurance fund in FHA to encourage FHA to approve home-loan applications from buyers who cannot meet full standards and to make insured loans available in neighborhoods which do not meet present mortgage insurance requirements. Aids to housing sponsors It authorizes interest-free loans to cover preconstruction expenses of nonprofit housing sponsors and also creates a National Homeownership Foundation to provide grants or loans to housing sponsors. New communities It authorizes HUD to guarantee borrowings of private developers of new communities and to make supplementary grants to States and localities in connection with federally aided water, sewer, and openspace land projects that assist the new community development. Neighborhood development program It authorizes an alternative form of urban renewal under which a community could elect to carry out a project on the more flexible basis of annual increments of planned renewal activities over the period required for completion in place of the present lump sum commitment for an entire project fully planned in advance. Rehabilitation loans and grants It increases the maximum rehabilitation grant from $1,500 to $3,000. It also extends the provisions of the rehabilitation grant and loan programs for definitely planned rehabilitation or code enforcement or where such assistance is needed to bring properties up to reasonable underwriting standards under applicable statewide property insurance inspection plans. Low and moderate income housing It requires that a majority of the housing units provided in the future in each community's new urban renewal projects redeveloped for residential purposes must be for low and moderate income families, including at least 20 percent of all units for low-income families except (1) |