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42 USC 1 4 0 1465. "
 * 5

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[79 STAT.

otherwise payable for the project shall be increased by an amount equal to the total amount of the grants under this section and that no part of the total amount of such grants shall be required to be contributed as part of the local grant-in-aid. " (b) A grant authorized by this section may be made to an individual or family whose income does not exceed $3,000 a year, and such grant may be in the amount which does not exceed the lesser of (1) the actual (and approved) cost of the repairs and improvements involved, or (2) $1,500, I n case the income of the individual or family exceeds $3,000 a year, a grant may be made under this section, subject to the limitations specified in clauses (1) and (2) of the preceding sentence, but only in an amount not to exceed that portion of the cost of the repairs and improvements which cannot be paid for with any available loan that can be amortized as part of such individual's or family's monthly housing expense without requiring such monthly housing expense to exceed 25 per centum of such individual's or family's monthly income." (b) Any contract with a local public agency which was executed under title I of the Housing Act of 1949 before the date of enactment of this Act may be amended to provide for grants authorized by section 115 of the Housing Act of 1949. MORTGAGE R E L I E F FOR H O M E O W N E R S W H O ARE U N E M P L O Y E D AS THE R E S U L T OF THE CLOSING OF A FEDERAL I N S T A L L A T I O N

48 Stat, 1246. 58 Stat. 284;' 72 Stat. 'i203,' ^ 3 8 "use 1801^^ 1825.

mora't^rium^ °^

SEC. 107. (a) For the purposes of this section— (1) The term "mortgage" means a mortgage which (A) is insured under the National Housing Act, or (B) secures a home loan guaran^eed OT iusured under the Servicemen's Readjustment Act of 1944 or chapter 37 of title 38, United States Code. (^) The term "Federal mortgage agency" means— (A) the Federal Housing Commissioner when used in connection with mortgages insured under the National Housing Act, and (B) the Administrator of Veterans' Affairs when used in connection with mortgages securing home loans guaranteed or insured under the Servicemen's Readjustment Act of 1944 or chapter 37 of title 38, United States Code. (3) The term "distressed mortgagor" means an individual who— (A) is unemployed, although willing to work, as the result of the closing (in whole or in part) of a Federal installation, and (B) is the owner-occupant of a dwelling upon which there is a mortgage securing a loan which is in default because of the inability of such individual to make payments of principal and/or interest under such mortgage. (b)(1) Any distressed mortgagor, for the purpose of avoiding foreclosure of his mortgage, may apply to the appropriate Federal mortgage agency for a determination that suspension of his obligation to make payments of principal and/or interest under such mortgage during a temporary period is necessary in order to avoid such foreclosure. (^) Upon Tcceipt of au application made under this subsection by a distressed mortgagor, the Federal mortgage agency shall issue to such mortgagor a certificate of moratorium if it determines, after consultation with the interested mortgagee, that— (A) the mortgagor is not in default with respect to any condition or covenant of the mortgage other than that requiring the payment of installments of principal and/or interest under the mortgage, and

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(B) such action is the only available means whereby a foreclosure of such mortgage can be avoided. (3) Prior to the issuance to any distressed mortgagor of a certificate of moratorium under paragraph (2)^ the Federal mortgage agency shall require such mortgagor to enter into a binding agreement under which he will be required to make payments to such agency, after the expiration of such certificate, in an aggregate amount equal to the amount paid by such agency on behalf of such mortgagor as provided in subsection (c). The manner and time in which such payments shall be made shall be determined by the Federal mortgage agency having due regard to the purposes sought to be achieved by this section. (4) Any certificate of moratorium issued under this subsection shall expire on whichever of the following dates is the earliest— (A) one year from the date on which such certificate is issued; (B) thirty days after the date on which the mortgagor to whom such certificate is issued ceases to be a distressed mortgagor as defined in subsection (a); or (C) the date on which such mortgagor becomes in default with respect to any condition or covenant m his mortgage other than that requiring the payment by him of installments of principal and/or interest under the mortgage. (c)(1) Whenever a Federal mortgage agency issues a certificate of moratorium to any distressed mortgagor with respect to any mortgage, it shall transmit to the mortgagee a copy of such certificate, together with a notice stating that, while such certificate is in effect, such agency will assume the obligation of such mortgagor to make payments of principal, and, if so specified in the certificate, of interest, under the mortgage. (2) Payments made by any Federal mortgage agency pursuant to a certificate of moratorium issued under this section with respect to the mortgage of any distressed mortgagor shall include, in addition to the payments referred to in paragraph (1), an amount equal to the unpaid principal and interest charges which had accrued under such mortgage prior to the issuance of such certificate and subsequent to the date on which such mortgagor became a distressed mortgagor as defined in subsection (a). (3) While any certificate of moratorium issued under this section is in effect with respect to the mortgage of any distressed mortgagor, no further payments of principal, and, if so specified in the certificate, of interest, under the mortgage shall be required of such mortgagor, and no action (legal or otherwise) shall be taken or maintained by the mortgagee to enforce or collect such payments. Upon the expiration of such ceitificate, the mortgagor shall again be liable for the payment of all amounts due under the mortgage in accordance with its terms. (4) Each Federal mortgage agency shall give prompt notice in writing to the interested mortgagor and mortgagee of the expiration of any certificate of moratorium issued by it under this se-ction. (d) The Federal mortgage agencies are authorized to issue such individual and joint regulations as may be necessary to carry out this section and to insure the uniform administration thereof. (e) There shall be in the Treasury (1) a fund which shall be available to the Federal Housing Commissioner for the purpose of extending financial assistance in behalf of distressed mortgagors as provided in subsection (c), and (2) a fund which shall be available to the Administrator of Veterans' Affairs for the same purpose. The capital of each such fund shall consist of such sums as may, from time to time, be appropriated thereto, and any sums so appropriated shall remain available until expended. Receipts arising from the pro-

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72 Stat. 1212.

78 Stat. 380.

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[79 STAT.

grams of assistance under subsection (c) shall be credited to the fund from which such assistance was extended. Moneys in either of such funds not needed for current operations, as detemiined by the Federal Housing Commissioner, or the Administrator of Veterans' Affairs, as the case may be, shall be invested in bonds or other obligations of the United States, or paid into the Treasury as miscellaneous receipts. (fj Section 1816 of title 38, United States Code, is amended by inserting " (a) " before the text of such section, and by adding at the end thereof a new subsection as follows: " (b) With respect to any loan made under section 1811 which has not been sold as provided in subsection (g) of such section, if the Administrator finds, after there has been a default in the payment of any installment of principal or interest owing on such loan, that the default was due to the fact that the veteran who is obligated under the loan has become unemployed as the result of the closing (in whole or in part) of a Federal installation, he shall (1) extend the time for curing the default to such time as he determines is necessary and desirable to enable such veteran to complete payments on such loan, including an extension of time beyond the stated maturity thereof, or (2) modify the terms of such loan for the purpose of changing the amortization provisions thereof by recasting, over the remaining term of the loan, or over such longer period as he may determine, the total unpaid amount then due with the modification to become effective currently or upon the termination of an agreed-upon extension of the period for curing the default." ACQUISITION OF CERTAIN PROPERTIES SITUATED AT OR N E A R M I L I T A R Y BASES W H I C H H A V E B E E N ORDERED TO BE CLOSED

SEC. 108. (a) The Secretary of Defense is authorized to acquire title to any property, improved with a one- or two-family dwelling, which is situated at or near a military base or installation which the Department of Defense has, subsequent to November 1, 1964, ordered to be closed in whole or in part, if he determines— (1) that the owner of such property is, or has been, employed or performing military service, at such base or installation; (2) that the closing of such base or installation, in whole or in part, has required or will require the termination of such owner's employment or service at such base or installation; and (3) that as the result of the actual or pending closing of such base or installation there is no present market for the sale of such property upon reasonable terms and conditions.

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(b) The purchase price of any property which is situated at or near a military base or installation and is acquired under this section shall be equal to an amount determined by the Secretary of Defense to be the average price at which properties, similar in size, construction, condition, and location to that of the property to be acquired, were sold during a representative period, as determined by the Secretary, prior to the announcement of the intention of the Department of Defense to close all or part of such base or installation. (c) The title to any property acquired under this section shall be free and clear of any outstanding liens or encumbrances and shall conform to such requirements as the Secretary of Defense shall by regulation require. Such regulations shall also prescribe the terms and conditions under which payments may be made under this section, and decisions by the Secretary regarding such payments,^ and the terms and conditions under which the same are approved or disapproved, shall be final and conclusive and shall not be subject to judicial review. (d) Properties acquired under this section shall be transferred to the Federal Housing Commissioner, and the Federal Housing Commissioner shall have power to deal with, rent, renovate, or sell for cash or credit any properties so transferred. Receipts from the management or sale of any such properties may be utilized by the Commissioner to defray expenses arising in connection with the management of such properties, and any part of such receipts not required for such expenses shall be covered into the Treasury as miscellaneous receipts. (e) Section 223(a) of the National Housing Act is amended— e/stat^ 484°^' (1) by striking out the period at the end of paragraph (7) and 12 USC insn. inserting in lieu thereof "; or"; and (2) by inserting after paragraph (7) a new paragraph as folfollows: "(8) executed in connection with the sale by the Commissioner of any housing acquired pursuant to section 108 of the Housing and Urban Development Act of 1965." (f) Such sums as may be necessary to carry out the provisions of this section are hereby authorized to be appropriated, and any sums so appropriated shall remain available until expended. TITLE II—FHA INSURANCE OPERATIONS LAND DEVELOPMENT

SEC. 201. (a) The National Housing Act is amended by adding at \\^^lc 1701'and the end thereof the following new title: note. " TITLE X—MORTGAGE INSURANCE FOR DEVELOPMENT

LAND

"DEFINITIONS

"SEC. 1001. As used in this title— " (a) the term 'mortgage' means a lien or liens on real estate in fee simple, or on a leasehold (1) under a lease for not less than ninety-nine years which is renewable, or (2) under a lease having a period of not less than fifty years to run from the date the mortgage was executed; "(b) the term 'first mortgage' includes such classes of first liens as are commonly given to secure advances (including but not

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52 Stat. 16.

12 USC 1713.

PUBLIC LAW 89-117-AUGUST 10, 1965

[79 STAT.

limited to advances during construction) on, or the unpaid purchase price of, real estate under the laws of the State in which the real estate is located, together with the credit instrument or instruments, if any, secured thereby, and may be in the form of trust mortgages or mortgage indentures or deeds of trusts securing notes, bonds, or other credit instruments; "(c) the terms 'mortgage', 'mortgagor', and 'State' have the same meaning as in section 207 of this Act: (d) the term 'improvements means waterlmes and water supply installations, sewerlines and sewerage disposal installations, roads, streets, curbs, gutters, sidewalks, storm drainage facilities, and other installations or work, whether on or off the site, which the Commissioner deems necessary or desirable to prepare land primarily for residential and related uses or to provide facilities for public or common use; but such term shall not include any building unless it is (1) a building which is needed in connection with a water supply or sewage disposal installation, or (2) a building, other than a school, which is to be owned and maintained jointly by the property owners; and " (e) the term 'land development' means the process of making, installing, or constructing improvements. ((BASIC

CONDITIONS FOR INSURANCE

"SEC. 1002. (a) The Commissioner is authorized (1) to insure, upon such terms and conditions as he may prescribe, any first mortgage (including advances on such mortgage) in accordance with the provisions of this title, and (2) to make a commitment for the insurance of such mortgage prior to the date of execution of such mortgage or prior to the date of disbursement of the mortgage proceeds. No mortgage shall be insured under this title after October 1, 1969, except pursuant to a commitment to insure issued before such date. " (b) The mortgage shall— "(1) be executed by a mortgagor, other than a public body, approved by the Commissioner; "(2) be made to and held by a mortgagee approved by the Commissioner; and " (3) cover the land to be developed and the improvements to be made with the assistance of the mortgage insurance under this title, except facilities intended for public use and in public ownership. "(c) The principal obligation of the mortgage shall (1) not exceed 75 per centum of the Commissioner's estimate of the value of the property upon completion of the land development, and (2) not exceed the sum of 50 per centum of the Commissioner's estimate of the value of the land before development and 90 per centum of his estimate of the cost of such development. The outstanding principal obligations of mortgages involving a single land development undertaking, as defined by the Commissioner, shall at no time exceed $10,000,000. " (d) The mortgage shall— "(1) have a maturity not to exceed seven years or such longer maturity as the Commissioner deems reasonable in the case of a privately owned system for water or sewerage, and contain repayment provisions satisfactory to the Commissioner; "(2) bear interest at a rate satisfactory to the Commissioner, and such interest shall be exclusive of premium charges for mortgage insurance and such service charges and fees as may be approved by the Commissioner; and

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"(3) contain such terms and provisions with respect to protection of the security, payment of taxes, delinquency charges, prepayment, additional and secondary liens, and other matters as the Commissioner may in his discretion prescribe. "(e) A property or project to be financed by a mortgage insured under this title shall— " (1) represent a good mortgage insurance risk; and "(2) involve improvements that comply with all applicable State and local governmental requirements and with minimum standards approved by the Commissioner. "LAND PLANNING

"SEC. 1003. (a) The land development covered by a mortgage insured under this title shall be undertaken pursuant to a schedule, conforming to such requirements and procedures as the Commissioner may prescribe, that will assure the use of the land for the purposes for which it is to be developed within the shortest reasonable period consistent with the objectives of sound and economic community growth or urban development. " (b) The land development shall be undertaken in accordance with an overall development plan, appropriate to the scope and character of the undertaking, which— " (1) has received all governmental approvals required by State or local law or by the Commissioner; • " (2) is acceptable to the Commissioner as providing reasonable assurance that the land development will contribute to good living conditions in the area being developed, which area (A^ will have a sound economic base and a long economic life, (B) will be characterized by sound land-use patterns, and (C) will include or be served by such shopping, school, recreational, transportation, and other facilities as the Commissioner deems adequate or necessary; and "(3) is consistent with a comprehensive plan which covers, or with comprehensive planning being carried on for, the area in which the land is situated, and which meets criteria established by the Housing and Home Finance Administrator for such plans or planning. u ENCOURAGEMENT OF SMALL BUILDERS AND MODERATE COST HOUSING

"SEC. 1004. The Commissioner shall adopt such requirements as he deems necessary in land development covered by mortgages insured under this title to encourage the maintenance of a diversified local homebuilding industry, b r o ^ participation by builders, and the inclusion of a proper balance of housing for families of moderate or low income. "WATER

A N D S E W E R A G E FACILITIES

" S E C 1005. After development of the land it shall be served by public systems for water and sewerage which are consistent with other existing or prospective systems within the area, except that the Commissioner may approve an adequate privately or cooperatively owned system which will be regulated in a manner acceptable to him with respect to user rates and charges, capital structure, methods of operation, rate of return, and conditions and terms of any sale or transfer.

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[79 STAT.

'RELEASES

"SEC. 1006. The Coimnissioner may, on such terms and conditions as he may prescribe, consent to the release or subordination of a part or parts of the mortgaged property from the lien of the mortgage. ((PREMIUMS

Report to Congress

AND FEES

"SEC. 1007. The Commissioner shall collect reasonable premiums for the insurance of any mortgage under this title and make such charges as he determines are reasonable for the analysis of the land development plan and the appraisal and inspection of the property and improvements. On or before January 1, 1967, the Commissioner shall make a report to the Congress concerning the premium rates and other charges under this title that he estimates will be adequate to provide income sufficient for a self-supporting program. "INSURANCE BENEFITS

52 Stat, 16. 12 USC 1713.

"SEC. 1008. The provisions of subsections (e), (g), (h), (i), (j), (k), (1), and (n) of section 207 of this Act shall be applicable to mortgages insured under this title, except that as applied to such mortgages (1) any reference therein to section 207 shall be deemed to refer to this title, and (2) any reference to an annual premium shall be deemed to refer to such premiums as the Commissioner may designate under this title. IIINCONTESTABILITY PROVISIONS

"SEC. 1009. Any contract of insurance executed by the Commissioner under this title shall be conclusive evidence of the eligibility of the mortgage for insurance, and the validity of any contract of insurance so executed shall be incontestable in the hands of an approved mortgagee from the date of the execution of such contract, except for fraud or material misrepresentation on the part of such approved mortgagee. "RULES AND REGULATIONS

"SEC. 1010. The Commissioner is authorized to make such rules and regulations and to require such agreements as he may deem necessary or desirable to carry out the provisions of this title. "TAXATION PROVISIONS

"SEC. 1011. Nothing in this title shall be construed to exempt any real property acquired and held by the Commissioner under this title from taxation by any State or political subdivision thereof to the same extent, according to its value, as other real property is taxed. ((COST

CERTIFICATION

"SEC. 1012. (a) The Commissioner shall adopt such requirements as he determines necessary to assure, at reasonable intervals of time during land development and upon completion of such development, that the amount of the mortgage loan outstanding at each such interval does not exceed with respect to that portion of the land remaining under the lien of the mortgage (1) 50 per centum of the Commissioner's estimate of the value of such remaining land before development, plus (2) 90 per centum of the actual costs of the development allocated by the Commissioner to such remaining land.

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" (b) From time to time during, and upon completion of, the development, the Commissioner shall require the mortgagor to certify as to the actual costs of development of the land. "(c) Certifications required pursuant to this section shall be accompanied by such data and records as the Commissioner shall prescribe. " (d) A mortgagor's certification approved by the Commissioner shall be final and incontestable except for fraud or material misrepresentation on the part of the mortgagor. " (e) As used in this section, the term 'actual costs' means the costs (exclusive of kickbacks, rebates, or trade discounts) to the mortgagor of the improvements involved. These costs may include amounts paid for labor, materials, construction contracts, land planning, engineers' and architect's fees, surveys, taxes, and interest during development, organizational and legal expenses, such allocation of general overhead expenses as are acceptable to the Commissioner, and other items of expense incidental to development which may be approved by the Commissioner. If the Commissioner determines there is an identity of interest between the mortgagor and the contractor, there may be included an allowance for contractor's profit in an amount deemed reasonable by the Commissioner." (b)(1) Section 302(b) of the National Housing Act is amended by ^2 USC uii striking out "the term 'mortgages' " in the last sentence and inserting in lieu thereof "the terms 'mortgages' and 'home mortgages' ". (2) The first paragraph of section 24 of the Federal Keserve Act is ^^ ^^^ g^^^^^ amended by inserting before the next to last sentence the following new sentence: "Notwithstanding the foregoing limitations and restrictions in this section, any national banking association may make loans for land development which are secured by mortgages insured under title X of the National Housing Act." (3) Section 5(c) of the Home Owners Loan Act of 1933 is amended f^ ^*|^-1^^^ by adding at the end thereof the following new paragraph: "Without regard to any other provision of this subsection, any such association may, to such extent as the Federal Home Loan Bank Board may by regulation permit, invest in loans, and interests in loans, (1) secured by mortgages as to which the association has the benefit of insurance under title X of the National Housing Act or of a commitment or agreement for such insurance, or (2) guaranteed by the President under section 224 of the Foreign Assistance Act of 1961, as amended. Investments under clause (1) of this paragraph ^°«' ^- ^ss. shall not be included in any percentage of assets or other percentage referred to in this subsection. Investments under clause (2) of this paragraph shall not exceed, in the case of any association, 1 per centum of the assets of such association." (4) Section 212(a) of the National Housing Act is amended by ^^ ^^^ ^^o?^^ inserting at the end thereof the following new sentence: "The provisions of this section shall also apply to insurance under title X with I'espect to laborers and mechanics employed in land development financed with the proceeds of any mortgage insured under that title." EXTENSION OF INSURANCE AUTHORIZATIONS

SEC. 202. (a) Section 2(a) of the National Housing Act is amended by striking out "October 1, 1965" and inserting in lieu thereof "October 1, 1969". (b) Section 217 of such Act is amended— (1) by striking out "title VIII " and inserting in lieu thereof "title V i l l, or title X ", and (2) by striking out "October 1, 1965" and inserting in lieu thereof "October 1, 1969".

75 Stat. 177, 12 USC 1703.

12 USC 1715h.

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[79 STAT.

i2uS:*m8h-i, (^) "^^^ second sentences of sections 809(f) and 810(k) of such i748h-2. ' Act are each amended by striking out "October 1, 1965" and inserting in lieu thereof "October 1, 1969". MORTGAGE LIMITS FOR HOMES UNDER SECTION 203(b) 71 Stat 29575 Stat! 178. ' 12 USC 1709.

• ^^^^ ^^' ^^lause (iii) of section 203(b)(2) of the National Housing Act is amended by striking out "75 per centum" and inserting in lieu thereof "80 per centum". DOWNPAYMENT REQUIREMENT IN CASE OF LOW-INCOME HOUSING DEMONSTRATION HOMES

II l'^'^ i^4^|g

SEC. 204. Section 203(b)(9) of the National Housing Act is amended by inserting after "a mortgage meeting the requirements of subsection (i) of this section," the following: "or with respect to a mortgage covering a single-family home being purchased under the low-income housing demonstration project assisted pursuant to section 207 of the Housing Act of 1961,". MORTGAGE LIMIT FOR HOMES IN OUTLYING AREAS UNDER FHA SECTION 203 (i) PROGRAM SEC. 205. Section 203(i) of the National Housing Act is amended by striking out "$11,000" and inserting in lieu thereof "$12,500". FHA MORTGAGE FINANCING FOR VETERANS SEC. 206. (a) Section 203(b)(2) of the National Housing Act is amended— (1) by striking out "and not to exceed" and inserting in lieu thereof "and (except as provided in the next to the last sentence of this paragraph) not to exceed"; and (2) by adding at the end thereof the following new sentences: "If the mortgagor is a veteran who has not received any direct, guaranteed, or insured loan under laws administered by the Veterans' Administration for the purchase, construction, or repair of a dwelling (including a farm dwelling) which was to be owned and occupied hj him as his home, and the mortgage to be insured under this section covers property upon which there is located a dwelling designed principally for a one-family residence, the principal obligation may be in an amount equal to the sum of (i) 100 per centum of $15,000 of the appraised value of the property as of the date the mortgage is accepted for insurance, (ii) 90 per centum of such value in excess of $15,000 but not in excess of $20,000, and (iii) 85 per centum of such value in excess of $20,000. As used herein, the term 'veteran' means any person who served on active duty in the armed forces of the United States for a period of not less than ninety days (or is certified by the Secretary of Defense as having performed extra-hazardous service), and who was discharged or released therefrom under conditions other than dishonorable." (b) Section 203(b)(9) of such Act is amended by inserting after "on account of the property" the following:" (except in a case to which the next to the last sentence of paragraph (2) applies)".

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M U L T I F A M I L Y MORTGAGE L I M I T S FOR FOUR OR MORE BEDROOM U N I T S

SEC. 207. (a) Section 207(c)(3) of the National Housing Act is amended— (1) by striking out "and $18,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$18,600 per family unit with three bedrooms, and $21,000 per family unit with four or more bedrooms,"; and (2) by striking out "and $22,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$22,500 per family unit with three bedrooms, and $25,500 per family unit with four or more bedrooms". (b)(1) Section 213(b)(2) of such Act is amended— (A) by striking out "and $18,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$18,500 per family unit with three bedrooms, and $21,000 per family unit with four or more bedrooms"; and (B) by striking out "and $22,500 per family unit with three or more bedrooms" and inserting in lieu thereof "22,500 per family unit with three bedrooms, and $25,500 per family unit with four or more bedrooms". (2) Section 213(c) of such Act is amended by striking out "and not to exceed" and all that follows and inserting in lieu thereof the following: "and not to exceed a sum computed on the basis of a separate mortgage for each single-family dwelling (irrespective of whether such dwelling has a party wall or is otherwise physically connected with another dwelling or dwellings) comprising the property or project, equal to the total of each of the maximum principal obligations of such mortgages which would meet the requirements of section 203(b)(2) if the mortgagor were the owner and occupant who had made any required payment on account of the property prescribed in such paragraph." (c) Section 220(d)(3)(B) (iii) of such Act is amended— (1) by striking out "and $18,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$18,500 per family unit with three bedrooms, and $21,000 per family unit with four or more bedrooms"; and (2) by striking out "and $22,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$22,500 per family unit with three bedrooms, and $25,500 per family unit with four or more bedrooms". (d) Section 221(d) of such Act is amended— (1) by striking out "and $17,000 per family unit with three or more bedrooms" in paragraphs (3) (ii) and (4) (ii) and inserting in lieu thereof "$17,000 per family unit with three bedrooms, and $19,250 per family unit with four or more bedrooms"; and (2) by striking out "and $20,000 per family unit with three or more bedrooms" m paragraphs (3) (li) and (4) (ii) and inserting in lieu thereof "$20,000 per family unit with three bedrooms, and $22,750 per family unit with four or more bedrooms". (e) Section 231(c)(2) of such Act is amended— (1) by striking out "and $17,000 per family unit with three or more bedrooms" and inserting in lieu thereof "$17,000 per family unit with three bedrooms, and $19,250 per family unit with four or more bedrooms"; and (2) by striking out "and $20,000 per family unit with three or more bedrooms" and inserting in lieu thereof "$20,000 per family unit with three bedrooms, and $22,750 per family unit with four or more bedrooms".

^^ f}^' 7J,'*-

^^ use irise,

64 Stat. 55.

^^ ^^^ ^^^^ 78 Stat. 775. 12 USC 1715k.

12 USC nisz.

12 USC ivisv,

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PUBLIC LAW 89-117-AUGUST10, 1965

[79 STAT.

(f) Section 234(e)(3) of such Act is amended— (1) by stHking out "and $18,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$18,500 per family unit with three bedrooms, and $21,000 per family unit with four or more bedrooms"; and (2) by striking out "and $22,500 per family unit with three or more bedrooms" and inserting in lieu thereof "$22,500 per family unit with three bedrooms, and $25,500 per family unit with four or more bedrooms". MUTUALITY

FOR

MANAGEMENT-TYl'E

COOPEKATIVES

fn°a°ement''Hous ^^^' ^^^" ^^^ Section 213 of the National Housing Act is amended ing"rns^<^ance °"^" by adding at the end thereof the following new subsections: Fund. "(k) There is hereby created a Cooperative Management Housing 12 us^c mse. Insurance Fund (hereinafter referred to as the 'Management F u n d '). The Management Fund shall be used by the Commissioner as a revolv• ing fund for cariying out the provisions of this section with respect to mortgages or loans insured, on or after the date of the enactment of this subsection, under subsections (^a)(1), (a)(3) (if the project is acquired by a cooperative corporation), (i), and (j). The Management Fund shall also be used as a revolving fund for mortgages, loans, and commitments transferred to it pursuant to subsection (m). The Commissioner is directed to transfer to the Management Fund Post, p. 471. from the General Insurance Fund established pursuant to section 519 such amount as the Commissioner determines to be necessary and appropriate. General expenses of operation of the Federal Housing Administration relating to mortgages or loans which are the obligation of the Management F u n d may be charged to the Management Fund. General Surplus "(^j) ^j^g Commissioner shall establish in the Management Fund, as ticip^t'ing' Re^serve of the date of the enactment of this subsection, a General Surplus Accounts, count and a Participating Reserve Account. The aggregate net income thereafter received or any net loss thereafter sustained by the Management Fund, in any semiannual period, shall be credited or charged to the General Surplus Account or the Participating Reserve Account or both in such manner and amounts as the Commissioner may determine to be in accord with sound actuarial and accounting practice. Upon termination of the insurance obligation of the Management Fund by payment of any mortgage or loan insured under this section, and at such time or times prior to such termination as the Commissioner may determine, the Commissioner is authorized to distribute to the mortgagor or borrower a share of the Participating Reserve Account in such manner and amount as the Commissioner shall determine to be equitable and in accordance with sound actuarial and accounting practice: Provided, That in no event shall the amount of the distributable share exceed the aggregate scheduled annual premiums of the mortgagor or borrower to the year of payment of the share less the total amount of any share or shares previously distributed by the Commissioner to the mortgagor or borrower: And provided further. That in no event may a distributable share be distributed until any funds transferred from the General Insurance Fund to the Management Fund pursuant \o subsection (k) or (o) have been repaid in full to the General Insurance Fund. No mortgagor, mortgagee, borrower, or lender shall have any vested right in a credit balance in any such account or be subject to any liability arising out of the mutuality of the Management Fund. The determination of the Commissioner as to the amount to be paid by him to any mortgagor or borrower shall be final and conclusive.

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" (m) The Commissioner is authorized to transfer to the Management F u n d commitments for insurance issued under subsections (a) (1), (i), and (j) prior to the date of the enactment of this subsection, and to transfer to the Management F u n d the insurance of any mortgage or loan insured prior to the date of the enactment of this subsection under subsection (a)(1), (a)(3) (if the project is acquired by a cooperative corporation), (i), or (j), but only in cases where the consent of the mortgagee or lender to the transfer is obtained or a request by the mortgagee or lender for the transfer is received by the Commissioner within such period of time after the date of the enactment of this subsection as the Commissioner shall prescribe: Provided, That the insurance of any mortgage or loan shall not be transferred under the provisions of this subsection if on the date of the enactment of this subsection the mortgage or loan is in default and the mortgagee or lender has notified the Commissioner in writing of its intention to file an insurance claim. Any insurance or commitment not so transferred shall continue to be an obligation of the General Insurance Fund. " (n) Notwithstanding the limitations contained in other provisions of this Act, premium charges for mortgages or loans insured under this section and sections 207,231, and 232 may be payable in debentures 7352 Stat. 1(5; 663. Stat. 665, issued in connection with mortgages or loans transferred to the Man- 12 USC"l7'i3^ agement F u n d or in connection with mortgages or loans insured pur- ^^isv, i7i5w suant to commitments transferred to the Management Fund, as provided in subsection (m) of this section. "(o) Notwithstanding any other provision of this Act, the Commissioner is authorized to transfer funds between the Cooperative Management Housing Insurance Fund and the General Insurance Fund in such amounts and at such times as he may determine, taking into consideration the requirements of each such Fund, to assist in carrying out effectively the insurance programs for which such Funds were respectively established." 64 Stat. 54. (b) Section 213 of such Act is further amended— 12 USC 1715e. (1) by inserting before the period at the end of subsection (a) the following: ": Provided, That as applied to mortgages the mortgage insurance for which is the obligation of the Management Fund, the reference to the General Insurance Fund in section 207(b)(2) shall be construed to refer to the Management Fund";and (2) by inserting before the period at the end of subsection (e) the following: ": Provided, That as applied to mortgages or loans the insurance for which is the obligation of the Management F u n d (1) all references to the General Insurance Fund shall be construed to refer to the Management Fund, and (2) all references to section 207 shall be construed to refer to subsections (a)(1), (a)(3) (if the project involved is acquired by a cooperative corporation), (i), and (j) of this section". R E H A B I L I T A T I O N I N U R B A N R E N E W A L AREAS

SEC. 209. Section 2 2 0 (d)(3)(A) of the National Housing Act is ^^lS^^^\il^'' amended— 12 USC 1715k. (1) by striking out the second proviso in clause (i); and (2) by striking out clause (ii) and inserting in lieu thereof the following: " ( i i) in a case where the mortgagor is not the occupant of the property and intends to hold the property for rental purposes, have a principal obligation in an amount not to exceed 93 per centum of the amount computed under the provisions of clause

(i);

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PUBLIC LAW 89-117-AUGUST 10, 1965

[79 STAT.

"(idi) in a case where the mortgagor is not the occupant of the property and intends to hold the property for the purpose of sale, have a principal obligation in an amount not to exceed 85 per centum of the amount computed under the provisions of clause (i), or in the alternative, in an amount equal to the amount computed under the provisions.of clause (i) if the mortgagor and mortgagee assume responsibility in a manner satisfactory to the Commissioner for the reduction of the mortgage by an amount not less than 15 per centum of the outstanding principal amount thereof, or by such greater amount as may be required to meet the limitations of clause (iv), in the event the mortgaged property is not, prior to the due date of the eighteenth amortization payment of the mortgage, sold to a purchaser acceptable to the Commissioner who is the occupant of the property and who assumes and agrees to pay the mortgage indebtedness; and "(iv) in no case involving refinancing (except as provided in clause (iii)) have a principal obligation in an amount exceeding the sum of the estimated cost of repair and rehabilitation and the amount (as determined by the Commissioner) required to refinance existing indebtedness secured b^^ the property or project, plus any existing indebtedness incurred in connection with improving, repairing, or rehabilitating the property; or". NONDWELLING FACILITIES FOR URBAN RENEWAL HOUSING

i2trec msk.

SEC. 210. Section 2 2 0 (d)(3)(B) of the National Housing Act is amended by striking out clause (iv) and inserting in lieu thereof the following: "(iv) include such nondwelling facilities as the Commissioner deems desirable and consistent with the urban renewal p l a n: Provided, That the project shall be predominantly residential and any nondwelling facility included in the mortgage shall be found by the Commissioner to contribute to the economic feasibility of the project, and the Commissioner shall give due consideration to the possible effect of the project on other business enterprises in the community." LARGER HOME IMPROVEMENT LOANS IN HIGH COST AREAS

75 Stat. 155,

78 Stat. 778.

S E C 211. (a) Section 220(h)(2)(i) of the National Housing Act is amended by inserting before the semicolon at the end thereof'': Provided, That the Commissioner may, by regulation, increase such amount by not to exceed 45 per centum in any geographical area where he finds that cost levels so require". (^j) Section 220(h) (11) of such Act is amended by inserting before the period at the end thereof "or such additional amount as the Commissioner has by regulation prescribed in any geographical area where he finds cost levels so require pursuant to the authority vested in him by the proviso in paragraph (2)(i) of this subsection". LARGER INSURED MORTGAGES FOR SERVICEMEN

71 Stat. 296; 12 USC V7"i5m.

§£(.. 212. Section 222(b) of the National Housing Act is amended— (1) by stHking out "$20,000" in paragraph (2) and inserting in lieu thereof "$30,000"; and (2) by striking out paragraph (3) and inserting in lieu thereof the following: "(3) have a principal obligation not in excess of the sum of (i) 97 per centum of $15,000 of the appraised value of the property

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as of the date the mortgage is accepted for insurance, (ii) 90 per centum of such value in excess of $15,000 but not in excess of $20,000, and (iii) 85 per centum of such value in excess of $20,000; and". REFINANCING OF INSURED MORTGAGES

SEC. 213. Section 223(a)(7) of the National Housing Act is amended by striking out "section 608 of title VI prior to the effective date of the Housing Act of 1954 or under section 220, 221, 903, or section 908" and inserting in lieu thereof "this Act".

^^ use i7i5n.

CONSOLIDATION OF FHA INSURANCE FUNDS

SEC. 214. Title V of the National Housing Act is amended by i735b"^^ ^^^^^" adding at the end thereof the following new section: " ESTABLISHMENT O F GENERAL INSURANCE FUND

"SEC. 519. (a) There is hereby created a General Insurance F u n d which shall be used by the Commissioner, on and after the date of the enactment of the Housing and Urban Development Act of 1965, as a revolving fund for carrying out all the insurance provisions of this Act with the exception of those specified in subsection (e). All mortgages or loans insured under this Act pursuant to commitments issued on or after the date of the enactment of the Housing and Urban Development Act of 1965, except those specified in subsection (e), and all loans reported for insurance under section 2 on or after the date of the enactment of the Housing and Urban Development Act of 1965, shall be insured under the General Insurance Fund. The Commissioner shall transfer to the General Insurance Fund— "(1) the assets and liabilities of all insurance accounts and funds, except the Mutual Mortgage Insurance Fund, existing under this Act immediately prior to the enactment of the Housing and Urban Development Act of 1965; "(2) all outstanding commitments for insurance issued prior to the date of the enactment of the Housing and Urban Development Act of 1965, except those specified in subsection (e); "(3) the insurance on all mortgages and loans insured prior to the date of the enactment of the Housing and Urban Development Act of 1965, except insurance specified in subse-ction (e); and "(4) the insurance of all loans made by approved financial institutions pursuant to section 2 prior to the date of the enactment of the Housing and Urban Development Act of 1965. " (b) The general expenses of the operations of the Federal Housing Administration relating to mortgages and loans which are the obligation of the General Insurance Fund may be charged to the General Insurance Fund. "(c) Moneys in the General Insurance Fund not needed for the current operations of the Federal Housing Administration with respect to mortgages and loans which are the obligation of the General Insurance Fund shall be deposited with the Treasurer of the United States to the credit of such Fund, or invested in bonds or other obligations of, or in bonds or other obligations guaranteed as to principal and interest by, the United States. The Commissioner may, with the approval of the Secretary of the Treasury, purchase in the open market debentures issued as obligations of the General Insurance F u n d or issued prior to the enactment of the Housing and Urban

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Page:United States Statutes at Large Volume 79.djvu/512

 472

^2 USC 1709, Ante, p. 468.

PUBLIC LAW 89-117-AUGUST 10, 1965

[79 STAT.

Development Act of 1965 under other provisions of this Act, except debentures issued under the Mutual Mortgage Insurance Fund. Such purchases shall be made at a price which will provide an investment y,ield of not less than the yield obtainable from other investments authorized by this section. Debentures so purchased shall be canceled and not reissued. " (d) Premium charges, adjusted premium charges, and appraisal and other fees received on account of the insurance of any mortgage or loan which is the obligation of the General Insurance Fund, the receipts derived from the property covered by such mortgages and loans and from the claims, debts, contracts, property, and security assigned to the Commissioner in connection therewith, and all earnings on the assets of the Fund shall be credited to the General Insurance Fund. The principal of, and interest paid and to be paid on, debentures which are the obligation of such Fund, cash insurance payments and adjustments, and expenses incurred in the handling, management, renovation, and disposal of properties acquired, in connection with mortgages and loans which are the obligation of such Fund, shall be charged to such Fund. "(e) The General Insurance Fund shall not be used for carrying out the provisions of sections 208(b), 203 (h), and 203(i), or the provisions of section 213 to the extent that they involve mortgages the insurance for which is the obligation of the Cooperative Management Housing Insurance Fund created by section 213(k); and nothing in this section shall apply to or affect any mortgages, loans, commitments, or insurance under such provisions." OPTIONAL CASH P A Y M E N T

OF INSURANCE

BENEiFITS

SEC. 215. Title V of the National Housing Act is amended by adding at the end thereof (after the new section added by section 214 of this Act) the following new section: uOPTIONAL

CASH

PAYMENT

OF INSURANCE

BENEFITS

"SEC. 520. (a) Notwithstanding any other provisions of this Act with respect to the payment of insurance benefits, the Commissioner is authorized, in his discretion, to pay in cash or in debentures any insurance claim or part thereof which is paid on or after the date of the enactment of the Housing and Urban Development Act of 1965 on a mortgage or a loan which was insured under any section of this Act either before or after such date. If payment is made in cash, it shall be in an amount equivalent to the face amount of the debentures that would otherwise be issued plus an amount equivalent to the interest which the debentures would have earned, computed to a date to be established pursuant to regulations issued by the Commissioner. "(b) The Commissioner is authorized to borrow from the Treasury from time to time such amounts as the Commissioner shall determine are necessary to make payments in cash (in lieu of issuing debentures guaranteed by the United States, as provided in this Act) pursuant to the provisions of this section. Notes or other obligations issued by the Commissioner in borrowing under this subsection shall be subject to such terms and conditions as the Secretary of the Treasury may prescribe. Each sum borrowed pursuant to this subsection shall bear interest at a rate determined by the Secretary of the Treasury, taking into consideration the average market yield on outstanding marketable obligations of the United States of comparable maturities during the month preceding the issuance of such notes or other obligations."

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473

APPROVAL OF TECHNICALLY SUITABLE MATERIALS

SEC. 216. Title V of the National Housing Act is amended by inserting after section 520 (added by section 215 of this Act) a new section as follows: " A P P R O V A L O F TECHNICALLY SUITABLE MATERIALS

"SEC. 521. The Commissioner shall adopt a uniform procedure for the acceptance of materials and products to be used in structures approved for mortgages or loans insured under this Act. Lender such procedure any material or product which the Commissioner finds is technically suitable for the use proposed shall be accepted. Acceptance of a material or product as technically suitable shall not be deemed to restrict the discretion of the Commissioner to determine that a structure, with respect to which a mortgage is executed, is economically sound or an acceptable risk." W^\TER AND S E W E R F A C I L II T E S IN CONNECTION WITH CERTAIN FEDERALLY ASSISTED HOUSING

SEC. 217. (a) Title V of the National Housing Act is amended by inserting after section 521 (added by section 216 of this Act) a new section as follows: " W ^ A T E R AND

S E W E R FACILITIES

"SEC. 522. Notwithstanding any other provision of this Act, no mortgage which covers new construction shall be approved for insurance under this Act (except pursuant to a commitment made prior to the date of the enactment of the Housing and Urban Development Act of 1966) if the mortgaged property includes housing which is not served by a public or adequate community water and sewerage system: Provided, That this limitation shall be applicable only to property which is not served b j a system approved by the Commissioner pursuant to title X of this Act and which is situated in an area certified by appropriate local officials to be an area where the establishment of public or adequate community water and sewerage systems is economically feasible: Provided further,^ That for purposes of this section the economic feasibility of establishing such public or adequate community water and sewerage systems shall be determined without regard to whether such establishment is authorized by law or is subject to approval by one or more local governments or public bodies." (b) Section 1804 of title 38, United States Code, is amended by adding at the end thereof a new subsection as follows: "(e) No loan for the purchase or construction of new residential ]:>roperty (other than property served by a water and sewerage system approved by the Federal Housing Commissioner pursuant to title X of the National Housing Act) shall be financed through the assistance of this chapter, except pursuant to a commitment made prior to the date of the enactment of the Housing and Urban Development Act of 1965, if such property is not served by a public or adequate community Avater and sewerage system and is located in an area where the appropriate local officials certify that the establishment of such systems is economically feasible. For purposes of this subsection, the economic feasibility of establishing public or adequate community water and sewerage syctems shall be determined without regard to whether such establishment is authorized by law or is subject to approval by one or more local governments or public bodies." 49-850 0-66—33

^"'^' P- '*^'^-

^^ Stat. 1206.

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[79 STAT.

TITLE III—URBAN RENEWAL BTUDY OF HOUSTXG A N D B U I L D I N G CODES, Z O N I N G, TAX P O L I C I E S, A N D DEVELOPMENT STANDARDS

SEC. 301. (a) The Congress finds that the general welfare of the Nation requires that local authorities be encouraged and aided to prevent slums, blight, and sprawl, preserve natural beauty, and provide for decent, durable housing so that the goal of a decent home and a suitable living environment for every American family may be realized as soon as feasible. The Congress further finds that there is a need to study housing and building codes, zoning, tax policies, and development standards in order to determine how (1) local property owners and private enterprise can be encouraged to serve as large a part as they can of the total housing and building need, and (2) Federal, State, and local governmental assistance can be so directed as to place greater reliance on local property owners and private enterprise and enable them to serve a greater share of the total housing and building need. The Housing and Home Finance Administrator is therefore directed to study the structure of (1) State and local urban and suburban housing and building laws, standards, codes, and regulations and their impact on housing and building costs, how they can be simplified, improved, and enforced, at the local level, and what methods might be adopted to promote more uniform building codes and the acceptance of technical innovations including new building practices and materials; (2) State and local zoning and land use laws, codes, and regulations, to find ways by which States and localities may improve and utilize them in order to obtain further growth and development; and (3) Federal, State, and local tax policies with respect to their effect on land and property cost and on incentives to build housing and make improvements in existing structures. Report to Presi(^y^j -pj^g Administrator shall submit a report based on such study to ongress. ^^^^ President and to the Congress within 18 months after the date of the enactment of the Housing and Urban Development Act of 1965 or the appropriation of funds for the study, whichever is later. (c) There are authorized to be appropriated such funds as may be necessary to carry out the purposes of this section. Any funds so appropriated shall remain available until expended. WORKABLE PROGRAM REQUIREMENT

42 USC f45i

SEC. 302. (a)(1) Section 101 of the Housing Act of 1949 is amended by adding at the end thereof the following new subsection: "(e) No loan or grant contract may be entered into by the Administrator for an urban renewal project unless he determines that (1) the workable program for community improvement presented by the locality pursuant to subsection (c) is of sufficient scope and content to furnish a basis for evaluation of the need for the urban renewal project; and (2) such project is in accord with the program." (2) The requirements imposed by the amendment made by paragraph (1) shall not be applicable to any project which received Federal recognition prior to the date of the enactment of this Act. (b) Section 101(c) of such Act is amended by adding at the end thereof the following new sentence: "Notwithstanding any other provision of law, in the case of a contract with an Indian tribe, band, or nation (or a public housing or other public agency for such tribe, band, or nation established under State or tribal law), the workable program and minimum standards housing code, referred to in the preceding sentence, may be presented to the Administrator by such

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tribe, band, or nation, and it shall be subject to the requirements of law with respect to such program and code only to the extent that such tribe, band, or nation has the legal jurisdiction and power to carry out such requirements." GENERAL NEIGHBORHOOD RENEWAL, P L A N S

SEC. 303. Section 102(d) of the Housing Act of 1949 is amended— (1) by striking out the tirst sentence of the second paragraph and inserting in lieu thereof the following: "In order to facilitate proper preliminary planning for the attainment of the urban renewal objectives of this title, the Administrator may also make advances of funds (in addition to those authorized above) to local public agencies for the preparation of General Neighborhood Kenewal 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 w4th the capacity and resources of the respective local public agency or agencies, over an estimated period of not more than ei^ht years."; and (2) by striking out the first numbered paragraph and inserting in lieu thereof the following: " (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;".

Jo Jta^- ^'o^g.

I N C R E A S E I N AUTHORIZATION FOR CAPITAL GRANTS

SEC. 304. (a) The first sentence of section 103(b) of the Housing Act of 1949 is amended by striking out "$4,725,000,000" and inserting in lieu thereof "$4,700,000,000, 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". (b) The proviso in the first sentence of section 103(b) of such Act, and the second sentence of section 6(b) of the Urban Mass Transportation Act of 1964, are repealed. RELOCATION OF DISPLACEES FROM U R B A N R E N E W A L

J

Repeals If f,*f!,- f£f:

AREAS

SEC. 305. (a) Section 105(c) of the Housing Act of 1949 is amended 4.

78 Stat. 785. 42 USC 1453.

Jt u

to read as loilows: "(c)(1) There shall be a feasible method for the temporary relocation of individuals and families displaced from the urban renewal area, and there are or are being provided, in the urban renewal area or in other areas not generally less desirable in regard to public utilities and public and commercial facilities and at rents or prices within the financial means of the individuals and families displaced from the urban renewal area, decent, safe, and sanitary dwellings equal in number to the number of and available to such displaced individuals and families and reasonably accessible to their places of employment. The Administrator shall issue rules and regulations to aid in implementing the requirements of this subsection and in otherwise achieving the objectives of this title. Such rules and regulations shall require that there be established, at the earliest practicable time, for each urban renewal project involving the displacement of individuals, families, and business concerns occupying property in the urban

63 Stat. 4i7. 42 USC 1455.

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^s Vc^^^' 42 USC 1451.

PUBLIC LAW 89-117-AUGUST10, 1965

[79 STAT.

renewal area, a relocation assistance program which shall include such measures, facilities, and services as may be necessary or appropriate in order (A) to determine the needs of such individuals, families, and business concerns for relocation assistance; (B) to provide information and assistance to aid in relocation and otherwise minimize the hardships of displacement, including information as to real estate agencies, brokers, and boards in or near the urban renewal area which deal in residential or business property that might be appropriate for the relocating of displaced individuals, families, and business concerns; and (C) to assure the necessary coordination of relocation activities with other project activities and other planned or proposed governmental actions in the community which may affect the carrying out of the relocation program, particularly planned or proposed lowrent housing projects to be constructed in or near the urban renewal area. "(2) As a condition to further assistance after the enactment of this paragraph with respect to each urban renewal project involving the displacement of individuals and families, the Administrator shall require, within a reasonable time prior to actual displacement, satisfactory assurance by the local public agency that decent, safe, and sanitary dwellings as required by the first sentence of this subsection are available for the relocation of each such individual or family," (b) Clause (iii) in the second proviso of section 101(c) of such Act is amended by striking out "section 105(c)" and inserting in lieu thereof "section 105(c)(1)". (c) The requirements imposed by the amendment made by subsection (a) of this section shall not be applicable to any project which received Federal recognition prior to the date of the enactment of this Act. REDEVELOPMENT I N ACCORDANCE W I T H U R B A N R E N E W A L P L A N

J3 uS;' tise

^^^' ^^^- S^c^io^^ ^^^ of the Housing Act of 1949 is amended by adding at the end thereof the following new subsection: " (h) Notwithstanding any other provision of this title, no contract shall be entered into for any loan or capital grant under this title with any local public agency unless the local public agency establishes, by evidence satisfactory to the Administrator, that any urban renewal project with respect to which such local public agency has received a loan or capital grant under this title has been, or will be, undertaken and carried out; in substantial accordance with the urban renewal plan, and any amendments thereto, approved with respect to such project, and the terms of the contract for loan or capital grant coveru\g such project." TTSE o r GRANT OR LOAN F U N D S I N CODE ENFORCEMENT A N D R E H A B I L I T A T I O N PROJECTS

78 Stat. 787.

42 USC 1460.

lo u s e II^^u T^^n 1452b. 42

SEC. 307. The first unnumbered paragraph following the numbered pi\ragraphs in section 110(c) of the Housing Act of 1949 is amended— (1) by inserting (A) ' before no contracr'; and (2) by inserting before the period at the end of the paragraph the following: ", and (B) not less than 10 per centum of the aggregate amount of (i) grants authorized to be contracted for under this title by the Housing and Urban Development Act of 1965 and subsequent Acts, and (ii^ loans authorized to be made under sect^o^ ^12 of the Housing Act of 1964, shall be available for projects assisted with such grants or loans which involve primarily code enforcement and rehabilitation".

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STAT.]

PUBLIC LAW 89-117-AUGUST10, 1965

477

INCREASE I N NONRESIDENTIAL EXCEPTION

SEC, 308. The third unnumbered paragraph following the numbered paragraphs in section 110(c) of the Housing Act of 1949 is amended by striking out the period and inserting in lieu thereof the following: ": And provided further, That the aggregate amount of capital grants made available under this title with respect to such projects after the date of the enactment of the Housing and Urban Development Act of 1965 may be in an amount not to exceed (in addition to amounts previousl;^ available for such projects) 35 per centum of the amount of additional capital grants authorized under this title by such Act." PRESERVATION

OF HISTORIC

H ^^^ J'J|^

STRUCTURES

SEC. 309. (a) Section 110(c) of the Housing Act of 1949 is amended—• (1) by striking out "and" at the end of paragraph (7); (2) by striking out the period at the end of paragraph (8) and inserting in lieu thereof "; and"; (3) by inserting a new paragraph (9) as follows: "(9) relocating within the project area a structure which the local public agency determines to be of historic value and which will be disposed of to a public body or a private nonprofit organization which will renovate and maintain such structure for historic purposes."; and (4) by striking out "paragraphs (7) and (8) " in the second unnumbered paragraph following the numbered paragraphs and inserting in lieu thereof "paragraphs (7), (8), and (9)". (b) Section 110(e) of such Act is amended by striking out "and (8) " in clause (i) and inserting in lieu thereof " (8), and (9)". E L I G I B I L I T Y OF CERTAIN E X P E N S E S OF PROJECTS F I N A N C E D ON T H R E E F O U R T H S GRANT BASIS

SEC. 310. (a) Clause (i) of the third sentence of section 110(e) of the Housing Act of 1949 is amended by (1) inserting "staff services in connection with programs of code enforcement and voluntary rehabilitation and repair (including community organization)," after "disposition of land,"; and (2) inserting " (5), " after "(4),". (b) Any contract for a capital grant under title I of the Housing Act of 1949, executed prior to the date of the enactment of this Act, ^^"^2 USC i45omay be amended to incorporate the provisions of subsection (a) as to costs incurred on or after the date of the enactment of this Act. DEMOLITION

OF

UNSAFE

STRUCTURES;

CODE

ENFORCEMENT

SEC. 311. (a) Title I of the Housing Act of 1949 is amended by inserting after section 115 (added by section 106 of this Act) two new sections as follows: "DEMOLITION

"SEC. 116. (a) Notwitlistanding any other provision of this title, the Administrator is authorized to enter into contracts to make, and to make, grants as provided in this section (payable from any grant funds provided under section 103(b)) t,o cities, other municipalities, and counties to assist in financing the cost of demolishing structures which under State or local law have been determined to be structurally unsound or unfit for human habitation, and which such city, municipality, or county has authority to demolish. The amount of

^^ Stat. 4ji6^

42 USC 1453.

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text: Appletons' Cyclopædia of American Biography/Möller, Henry


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42 USC f45^i

PUBLIC LAW 89-117-AUGUST10, 1965

[79 STAT.

any grant under this section shall not exceed two-thirds of the cost of the demolition of such structures. "(b) No grant shall be made under this section unless the structures to be demolished are located in an urban renewal area, pr, in the case of structures outside an urban renewal area, (1) the locality involved has an approved workable program for community improvenient in accordance with the requirements of section 101(c), as determined by the Administrator, (2) the demolition to be assisted will be on a planned neighborhood basis and will further the over-all renewal objectives of such locality, (3) there is in such locality a program of enforcement of existing local housing and related codes, (4) the structures to be demolished constitute a public nuisance and a serious hazard to the public health or welfare, and (5) the governing body of such locality has determined that other available legal procedures have been exhausted to secure remedial action by the owner of the structures involved and that demolition by governmental action is required. "CODE ENFORCEMENT

"SEC. 117. Notwithstanding any other provision of this title, the Administrator is authorized to enter into contracts to make, and to make, grants as provided in this section (payable from any grant 42 us^c M ^ 53 funds provided under section 103(b)) to cities, other municipalities, and counties for the purpose of assisting such localities in carrying out programs of concentrated code enforcement in deteriorated or deteriorating areas in which such enforcement, together with those public improvements to be provided by the locality, may be expected to arrest the decline of the area. Such grants shall not exceed twothirds (or three-fourths in the case of any city, other municipality, or county having a population of 50,000 or less according to the most recent decennial census) of the cost of planning and carrying out such programs which may include the provision and repair of necessary streets, curbs, sidewalks, street lighting, tree planting, and similar improvements within such areas. The Administrator shall not make any grant under this section unless he has obtained adequate assurances (1) that the locality will maintain during the period of the contract, in addition to its expenditures for planning and carrying out any program assisted under this section, a level of expenditures for code enforcement activities at not less than its normal expenditures for such activities prior to the execution of such contract, and (2) that the locality has a satisfactory program for the provision of all necessary public improvements for such areas. The provisions of sections 101(c), I4^65-"A'^ ^^^^45 ^^^' ^^'^' '^^^^ ^^^ shall be applicable to activities and undertakings ' " ' ^' • assisted under this section to the same extent as if such activities and undertakings were being carried out in an urban renewal area as part of an urban renewal project." 42 u^c i^-feo (^^ Section 110(c) of such Act is amended by— (1) striking out "or a program of code enforcement in an urban renewal area," in the first sentence; and (2) striking out the proviso in paragraph (5). 12 vie !iik ^^) Section 220(d)(1)(A) of the National Housing Act is amended by inserting before the first proviso the following: ", or (iv) an area in which a program of concentrated code enforcement activities is being carried out pursuant to section 117 of the Housing Act of 1949". 75 Stat. 154. (J) Section 220(h)(1) of the National Housing Act is amended by inserting after "virban renewal project" in the first sentence the following: "or in an area in which a program of concentrated code enforce-

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ment activities is being carried out pursuant to section 117 of the Housing Act of 1949". (e) Section 312(a) of the Housing Act of 1964 is amended by inserting after "urban renewal area" in the first sentence the following: "or an area in which a program of concentrated code enforcement activities is being carried out pursuant to section 117 of the Housing Act of 1949".

479

78 Stat. 790. 42 USC 1452b.

Ante, p. 478.

R E H A B I L I T A T I O N LOANS

SEC. 312. (a) Section 312(a) of the Housing Act of 1964 is amended by striking out "reasonable" in the second sentence and inserting in lieu thereof "comparable". (b) Section 312(d) of such Act is amended by striking out "$50,000,000" and inserting in lieu thereof "$100,000,000 for each fiscal year", and by adding at the end thereof a new sentence as follows: "All moneys in such revolving fund shall be available for necessary expenses of servicing loans made pursuant to this section, including reimbursement or payment for services and facilities of the Federal National Mortgage Association and of any public or private agency for the servicing of such loans." (c) Section 312 of such Act is further amended by adding at the end thereof the following new subsection: " (h) No loan shall be made under the authority of this section after October 1, 1969, except pursuant to a contract, commitment, or other obligation entered into pursuant to this section before that date." E L I G I B I L I T Y O F COMMUNITIES I N DEPRESSED AREAS FOR U R B A N R E N E W A L ASSISTANCE

SEC. 313. (a) Subparagraph (B) of section 103(a)(2) of the Housing Act of 1949 is amended to read as follows: J2 ijsc i^h " (B) 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, is designated as a redevelopment area under the second sentence of section 5(a) of the Area Eedevelopment 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 redev^opment area generally comparable to those set forth in the second sentence of section 5(a) of the Area Redevelopment Act, and", (b) The amendment made by subsection (a) shall apply only with respect to urban renewal projects placed under contract for capital grant on or after the date of the enactment of this Act, except that such amendment shall apply with respect to all urban renewal projects in the city of Providence, Rhode Island, placed under contract for capital grant during the period Providence was designated as a redevelopment area under section 5(a) of the Area Redevelopment Act (or at such earlier time as the Administrator may specify m order to avoid hardship) and not completed prior to the date of the enactment of this Act. LOCAL G R A N T - I N - A I D CREDIT FOR CERTAIN COAL ROYALTIES

SEC. 314. (a) Section 110(d) of the Housing Act of 1949 is amended by adding at the end thereof the following new paragraph:

tl 1%' 1?^^

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42 USC 14501465.

PUBLIC LAW 89-117-AUGUST10, 1965

[79 STAT.

"Where a project in any municipality includes an area affected by an underground mine fire or by a coal mine subsidence and where it is necessary in such project to remove any underlying coal deposits in order to stabilize the soil or to control the underground mine fire, then any royalties received by the project from the removal and sale oi such coal deposits shall be credited to the project as a local grant-in-aid made by such municipality." (b) Any contract under title I of the Housing Act of 1949 executed prior to the date of the enactment of this Act shall, at the request of the municipality involved, be amended to reflect the amendment made by subsection (a). SPECIFIC URBAX RENEWAL PROJECTS

42 USC uso note.

^A f e A fi^lx^ -

42 USC 1460.

SEC. 315. (a)(1) Notwithstanding the date of the commencement of construction of the Tanyard Creek collector sanitary sewer in Jasper, Alabama, local expenditures made in connection with this collector sanitary sewer system shall, to the extent otherwise eligible, be counted as a local grant-in-aid to the downtown urban renewal project (Alabama R-49) in accordance with the provisions of title I of the Housing Act of 1949. (2) Notwithstanding the date of the commencement of construction of the East Side High School and the start of construction of the improvements to Hickory Creek in Joliet, Illinois, expenditures made in connections with such high school and such creek improvements shall, to the extent otherwise eligible, be counted as a local grant-in-aid to the proposed south central urban renewal project in accordance with the provisions of title I of the Housing Act of 1949. (3) Notwithstanding the date of commencement of the installation of certain underground electrical wiring in Johnson City, Tennessee, expenditures made in connection with such installation shall, to the extent otherwise eligible, be counted as a local grant-in-aid to Johnson City's proposed downtown urban renewal project (Tennessee R-80) in accordance with the provisions of title I of the Housing Act of 1949. (4) Notwithstanding the provisions of section 312 of the Housing upon request of the local public agency the eligibility of the local grants-in-aid for any project in the city of New Brunswick, New Jersey, in connection with which the final capital grant payment has not been made, shall be determined in accordance with the provisions of section 110(d) of the Housing Act of 1949. (5) Two-thirds of all expenditures by the city of Saint Louis, Missouri, in connection with its Downtown Sports Stadium project, to the extent such expenditures would have been eligible under the provisions of section 110(d) of the Housing Act of 1949 to be counted as non-cash grants-in-aid toward such project if it had received Federal assistance as an urban renewal project pursuant to the provisions of title I of such Act, shall be eligible to be counted as a s:rant-in-aid toward any federallv-assisted urban renewal projects in Saint Louis. (6) Notwithstanding the extent to which the cultural and convention center proposed to be built adjacent to Urban Renewal Project Colorado R-15 (Skyline) in Denver, Colorado, may benefit areas other than the urban renewal area, expenses incurred by the city of Denver in constructing such center shall, to the extent otherwise eligible, be counted as a grant-in-aid toward such project. (7) Notwithstanding the extent to which the cultural and convention center proposed to be built within Urban Renewal Project R-8 in Norfolk, Virginia, may benefit areas other than the urban renewal
 * ^^^' ^^ ^^^'^ or any request previously made pursuant to such section,

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area, expenses incurred by the city of Norfolk in constructing such center shall, to the extent otherwise eligible, be counted as a grant-inaid toward such project. (8) Expenses incurred in the construction of the Glenn Duncan Elementary School and the Fred W. Traner Junior High School in Keno, Nevada, shall not be deemed to be ineligible as a local grant-inaid in connection with the Northeast Urban Renewal Project (Nevada R-2) because of any change in the urban renewal plan for such project which is determined by the Housing and Home Finance Administrator to have resulted from the proposed location of a federally-aided highway within or adjacent to the urban renewal area in which such project v;as undertaken. For the purpose of computing the portion of the cost of such schools which may be allowed as a local grant-in-aid, the degree of benefit of the schools to such urban renewal area shall be based on the latest estimate of benefit submitted by the local public agency and accepted by the Administrator prior to such change in the urban renewal plan. (9) Notwithstanding the provisions of section 112(a) of the Hous75 169. ing Act of 1949, expenditures in the amount of $600,000 made by the 42 Stat. 1463. use Memorial Hospital of Michigan City Foundation, Incorporated, for the purchase of certain land and buildings on or about July 24, 1963, from Doctors Hospital Realty Corporation shall, if otherwise eligible, be counted as local grants-in-aid to the community center numbered 1 urban renewal project (Indiana R-46) in Michigan City, Indiana, in accordance with the remaining provisions of title I of that Act. (10) The provisions of section 113(c) of the Housing Act of 1949 ^^ ^^^ ^^^^ shall be applicable to the Hobo Jungle Urban Renewal Project in Texarkana, Arkansas (Arkansas R - 3). (11) Notwithstanding the date of commencement of construction of the Pulaski, Showalter, and Smedley Junior High Schools, and the William Penn and Stetser Elementary Schools in Chester, Pennsylvania, local expenditures made in connection with such schools shall, to the extent otherwise eligible, be counted as local grants-in-aid for federally-assisted urban renewal projects in Chester that will be served by such schools. (12) Notwithstanding any other provision of law, moneys heretofore expended by the University of Pennsylvania and Wilkes College for land (and related expenditures for demolition and relocation) included in the overall development plans proposed by such institutions and utilized, or to be utilized, in connection with new facilities of such institutions within one mile of urban renewal projects Pennsylvana 5-3 (University City) and Pennsylvania R-149 (Wright Street), respectively, shall, if otherwise eligible, be allowed as local grants-in-aid for such projects. (13) Notwithstanding the June, 1956, commencement of certain flood control work in Ottumwa, Iowa, local expenditures in connection with such flood control work shall, to the extent otherwise eligible, be counted as a local grant-in-aid to the Marina Gateway urban renewal project (Iowa R-12) in accordance with the provisions of Title I of theHousing Act of 1949. ^^\\ use uso(b)(1) Notwithstanding the provisions of title I of the Housing Act of 1949 and the United States Housing Act of 1937, the Housing ^ l'^^ f ^^^ and Home Finance Administrator and the Public Housing Commissioner are authorized and directed to consent to the transfer by the Housing Authority of the City of Macon, Georgia, to the Urban Renewal Department of the City of Macon, Georgia, of all property acquired by the Housing Authority for low-rent housing project numbered Georgia 7-8, on condition that (A) an amount which, together

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42 USC M^" note.

PUBLIC LAW 89-117-AUGUST 10, 1965

with any funds of the Housing Authority available for the purpose, is sufficient to pay and discharge all obligations incurred by the Housing Authority in connection with such low-rent housing project and owing at the time of transfer, will be paid by the Urban Renewal Department of the City of Macon to the Public Housing Administration to be applied in satisfaction of the Housing Authority's obligations which it cannot meet with its own funds available for the purpose, and (B) the total amount so paid by the Urban Renewal Department of the City of Macon will be included in the gross project cost of its Coliseum Urban Renewal Project, Georgia R-95. (2) The Housing and Home Finance Administrator and the Public Housing Commissioner are authorized to modify any contracts heretofore entered into and to take any other appropriate action necessary to carry out the provisions of paragraph (1). (^) (1) Notwithstanding any provision of the Housing Act of 1949 or any other provision of law, the urban renewal project in Savannah, Georgia, known as Project " J " in the General Neighborhood Renewal Plan for the Broad Street-Canal Urban Renewal Area adopted by resolution of the Mayor and Aldermen of the City of Savannah on November 18, 1958, may include the donation by Housing Authority of Savannah, by a suitable instrument of conveyance, of the right, title, and interest of the Authority in and to all or any portion of the land included within the boundaries of such Project " J " in the City of Savannah, Chatham County, Georgia, the area of such Project " J " being generally bounded on the North by properties of the Central of Georgia Railway Company, on the East by West Broad Street, on the South by the right-of-way for Interstate Highway No. 1-16, and on the West by the Savannah and Ogeechee Canal and West Boundary Street. (2) The conveyance authorized to be included in the urban renewal project under paragraph (1) shall be made only if the donee represents, and furnishes such assurances as may be required by Housing Authority of Savannah, that such donee will develop, preserve, and operate such property on a nonprofit basis as a historical site or monument. LEASE GUARANTEES FOR CERTAIN S M A L L B U S I N E S S

note. 75 Stat. 756.
 * 2stat_.689.

CONCERNS

SEC. 316. (a) The Small Business Investment Act of 1958 is amended by adding after title III a new title as follows: "TITLE IV—LEASE GUARANTEES "AUTHORITY or

15 USC 63^^' 78 Stat. 526. 42 USC 2901-

[79 STAT.

THE ADMINISTRATION

"SEC. 401. (a) The Administration may, whenever it determines such action to be necessary or desirable, and upon such terms and conditions as it may prescribe, guarantee the payment of rentals under leases of commercial and industrial property entered into by small business concerns that are (1) eligible for loans under section 7(b)(3) ^^ ^^® Small Business Act, or (2) eligible for loans under title IV of the Ecouomic Opportunity Act of 1964, to enable such concerns to obtain such leases. Any such guarantee may be made or effected either directly or m cooperation with any qualified surety company or other qualified company through a participation agreement with such company. The foregoing powers shall be subject, however, to the following restrictions and limitations: "(1) No guarantee shall be issued by the Administration (A) if a guarantee meeting the requirements of the applicant is other-

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wise available on reasonable terms, and (B) unless the Administration determines that there exists a reasonable expectation that the small business concern in behalf of which the guarantee is issued will perform the covenants and conditions of the lease. "(2) The Administration shall, to the greatest extent practicable, exercise the powers conferred by this section in cooperation with qualified surety or other companies on a participation basis. " (b) The Administration shall fix a uniform annual fee for its share of any guarantee under this section which shall be payable in advance at such time as may be prescribed by the Administrator. The amount of any such fee shall be determined in accordance with sound actuarial practices and procedures, to the extent practicable, but in no case shall such amount exceed, on the Administration's share of any guarantee made under this title, 2i/^ per centum per annum of the minimum annual guaranteed rental payable under any guaranteed lease: Provided, That the Administration shall fix the lowest fee that experience under the program established hereby has shown to be justified. The Administration may also fix such uniform fees for the processing of applications for guarantees under this section as the Administrator determines are reasonable and necessary to pay the administrative expenses that are incurred in connection therewith. "(c) I n connection with the guarantee of rentals under any lease pursuant to authority conferred by this section, the Administrator may require, in order to minimize the financial risk assumed under such guarantee— "(1) that the lessee pay an amount, not to exceed one-fourth of the minimum guaranteed annual rental required under the lease, which shall be held in escrow and shall be available (A) to meet rental charges accruing in any month for which the lessee is in default, or (B) if no default occurs during the term of the lease, for application (with accrued interest) toward final payments of rental charges under the lease; "(2) that upon occurrence of a default under the lease, the lessor shall, as a condition precedent to enforcing any claim under the lease guarantee, utilize the entire period, for which there are funds available in escrow for payment of rentals, in reasonably diligent efforts to eliminate or minimize losses, by releasing the commercial or industrial property covered by the lease to another qualified tenant, and no claim shall be made or paid under the guarantee until such effort has been made and such escrow funds have been exhausted; "(3) that any guarantor of the lease will become a successor of the lessor for the purpose of collecting from a lessee in default rentals which are in arrears and with respect to which the lessor has received payment under a guarantee made pursuant to this section; and "(4) such other provisions, not inconsistent with the purposes of this title, as the Administrator may in his discretion require. u POWERS

"SEC. 402. Without limiting the authority conferred upon the Administrator and the Administration by section 201 of this Act, the Administrator and the Administration shall have, in the performance of and with respect to the functions, powers, and duties conferred by this title, all the authority and be subject to the same conditions prescribed in section 5(b) of the Small Business Act with respect to loans, ineluding the authority to execute subleases, assignments of lease and

15 USC' 57?;

J5 USC 63^^.'

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[79 STAT.

new leases with any person, firm, organization, or other entity, in order to aid in the liquidation of obligations of the Administration hereunder. "FUND

15 u*sc 6^71°"

7 2^"!^' 6 T^' 15 USC 695.

"SEC. 403. There is hereby established a revolving fund for use by the Administration in carrying out the provisions of this title. Initial capital for such fund shall consist of not to exceed $5,000,000 transferred from the fund established under section 4(c) of the Small Business Act: Provided, That the last sentence of such section 4(c) shall not apply to any amounts so transferred. Into the fund established by this section there shall be deposited all receipts from the guarantee program authorized by this title. Moneys in such fund not needed for the payment of current operating expenses or for the payment of claims arising under such program may be invested in bonds or other obligations ot, or bonds or other obligations guaranteed as to principal and interest by, the United States; except that moneys provided as initial capital for such fund shall be returned to the fund established by section 4(c) of the Small Business Act, in such amounts and at such times as the Administration determines to be appropriate, whenever the level of the fund herein established is sufficiently high to permit the return of such moneys without danger to the solvency of the program under this title." (^) Section 201 of such Act is amended by striking out the third sentence and inserting in lieu thereof the following: "The powers conferred by this Act upon the Administration and upon the Administrator, with the exception of those conferred by titles IV and V hereof, shall be exercised through the Small Business Investment Division and through the DejDuty Administrator appointed hereunder. The powers conferred by this Act upon the Administration and upon the Administrator by titles IV and V hereof shall be exercised through such division, section, or other personnel as the Administrator in his discretion shall determine." (c) The table of contents of such Act is amended by inserting after the analysis of title III the following: "TITLE IV—LEASE GUARANTEES "Sec. 401. Authority of the Administration. "Sec. 402. Powers. ••Sec. 403. Fund."

Ante, p. 207.

(^(j) Section 4(c) of the Small Business Act is amended— (1) by striking out "$1,716,000,000" and inserting in lieu thereof "$1,721,000,000,"; and (2) by striking out the period at the end of the fifth sentence and inserting in lieu thereof the following: ": Provided, That such limitation shall not apply to functions under title IV thereof." AMENDMENT OF SECTION 3 1 6 OF THE H O U S I N G ACT OF 1954

68 Stat. 630. ^.^. Code 5D.C. ^„^..-

717a. 14^65 ^^*^ ^^^°

SEC. 317. The first full paragraph of section 316(2) of the Housing -^^^ ^^ l^O'i: is amended by striking out the first parenthetical clause and inserting in lieu thereof the following: " (as such projects are now ^^ "^^y hereafter be defined in title I of the Housing Act of 1949, including but not limited to projects authorized without regard to the residential or nonresidential character or reuse of the urban renewal area)".

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STAT.]

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485

TITLE IV—COMPENSATION OF CONDEMXEES DEFINITIONS

SEC. 401. For the purposes of this title— (1) the term "development program" means any program established by or conducted under any of the following provisions of law: (A) the United States Housing Act of 1937; (B) title I of the Housing Act of 1949; (C) the Urban Mass Transportation Act of 1964; (D) title II of the Housing Amendments of 1955; (E) title VII of the Housing Act of 1961; and (F) title VII of the Housing and Urban Development Act of 1965; (2) the term "Federal assistance" means a grant, loan, contract of guaranty, annual contribution, or other assistance provided by the United States; (3) the term "applicant'' means any public body or other agency authorized to receive Federal assistance under a development program; (4) the term "real property" means any land, or any interest in land, and (A) any building, structure, or other improvements embedded in or affixed to land, and any article so affixed or attached to such building, structure, or improvement as to be an essential or integral part thereof; (B) any article affixed or attached to such real property in such manner that it cannot be removed without mat'erial injury to itself or the real property; and (C) any article so designed, constructed, or specially adapted to the purpose for which such real property is used that (i) it is an essential accessory or part of such real property, (ii) it is not capable of use elsewhere, and (iii) it would lose substantially all its value if removed from the real property; and (5) the term "Administrator" means the Housing and Home Finance Administrator. LAND ACQUISITION

POLICY

SEC. 402. As a condition of eligibility for Federal assistance pursuant to a development program, each applicant for such assistance shall satisfy the Administrator that the following policies will be followed in connection with the acquisition of real property by eminent domain in the course of such program— (1) the applicant shall make every reasonable effort to acquire the real property by negotiated purchase; (2) no owner shall be required to surrender possession of real property before the applicant pays to the owner (A) the agreed purchase price arrived at by negotiation, or (B) in any case where only the amount of the payment to the owner is in dispute, not less than 75 per centum of the appraised fair value of such property as approved by the applicant; and (3) the construction or development of any public improvements shall be so scheduled that no person lawnilly occupying the real property shall be required to surrender possession on account of such construction or development without at least 90 days' written notice from the applicant of the date on which such construction or development is scheduled to begin.

"' "^"^ '•''°42 USC i45o-i465. 49 USC leoi note. 42 USC 1491-1497. ^2 USC isoo-isooe. Post,

p„ 489.

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PUBLIC LAW 89-117-AUGUST10, 1965 F U N D S FOR CERTAIN P A Y M E N T S I N E M I N E N T

[79 STAT.

DOMAIN

SEC. 403. Notwithstanding any other provision of law, financial assistance under any federally assisted development program may include amounts necessary for financing, in the same manner that other costs of a project assisted under such program are financed, the payments described in paragraph (2)(B) of section 402 of this Act. RELOCATION PAYMENTS UNDER FEDERALLY ASSISTED DEVELOPMENT PROGRAMS

42 us^c M65

lllTcUis

SEC. 404. (a) To the extent not otherwise authorized under any Federal law, financial assistance extended to an applicant under any federally assisted development program may include grants for relocation payments, as herein defined. Such grants may be in addition to other financial assistance under such federally assisted development programs, and may cover the full amount of such relocation payments. Any funds available for any such program may be used for such grants. The term "relocation payments" means payments by the applicant, to a displaced individual, family, business concern, or nonprofit organization, which are made on such terms and conditions and subject to such limitations (to the extent applicable, but not including the date of displacement) as are provided for relocation payments, at the time such payments are approved, by sections 114(b), (c), and (d) ^^ ^^^^ Housing Act of 1949 with respect to projects assisted under title I thereof. Relocation payments authorized by this subsection shall be made subject to such rules and regulations as may be prescribed by the Administrator. (b) Section 114(b)(2) of the Housing Act of 1949 is amended by striking out "$1,500" and inserting in lieu thereof "$2,500". (c)(1) Section 114 of such Act is further amended by redesignating subsection (d) as subsection (e) and by inserting after subsection (c) the following new subsection: " (d) In addition to payments authorized to be made under subsections (b) and (c), a local public agency may pay to any displaced individual, family, business concern, or nonprofit organization reasonable and necessary expenses incurred for (1) recording fees, transfer taxes, and similar expenses incidental to conveying real property to a project assisted under this title, (2) penalty cosits for prepayment of any mortgage encumbering such real property, and (3) the pro rata portion of real property taxes allocable to a period subsequent to the date of vesting of title or the effective date of the acquisition of such real property by such agency, whichever is earlier." (2) Section 15(8) of the United States Housing Act of 1937 is amended by striking out "section 114(b) or (c) " and inserting in lieu thereof "section 114(b), (c),and (d) ". (cl) Subsection (a) shall not be applicable with respect to any displacement occurring prior to the date of the enactment of this Act (or prior to March 4, 1965, in the case of the programs specified in subparagraphs (C) and (E) of section 401(1)). TITLE V—LOW-RENT PUBLIC HOUSING ACCEPTANCE OF LOCAL C E R T I F I C A T I O N OF E Q U IV A L E N T E L I M I N A T I O N

42 u'sc M?'

SEC. 501. The fourth sentence of section 10(a) of the United States Housing Act of 1937 is amended by inserting immediately after "elimination", where it first appears, the following: ", as certified by the local governing body".

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