housing through a loan under this section rather than through mortgage insurance under such section 231 is necessary or desirable in order to avoid hardship for the elderly or handicapped families who are the prospective tenants of such housing.

(f) In carrying out the provisions of this section, the Secretary shall seek to assure, pursuant to applicable regulations, that housing and related facilities assisted under this section will be in appropriate support of, and supported by, applicable State and local plans which respond to Federal program requirements by providing an assured range of necessary services for individuals occupying such housing (which services may include, among others, health, continuing education, welfare, informational, recreational, homemaker, counseling, and referral services, transportation where necessary to facilitate access to social services, and services designed to encourage and assist recipients to use the services and facilities available to them), including plans approved by the Secretary of Health, Education, and Welfare pursuant to section 134 of the Mental Retardation Facilities and Community Mental Health Center Construction Act of 1963 or pursuant to title III of the Older Americans Act of 1965.1

*

Approved September 23, 1959.

EXCERPT FROM SECTION 210 OF THE HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1974

(g) (1) In determining the feasibility and marketability of a project under section 202 of the Housing Act of 1959, the Secretary shall consider the availability of monthly assistance payments pursuant to section 8 of the United States Housing Act of 1937 with respect to such a project.

(2) The Secretary shall insure that with the original approval of a project authorized pursuant to section 202 of the Housing Act of 1959, and thereafter at each annual revision of the assistance contract under section 8 of the United States Housing Act of 1937 with respect to such units in such project, the project will serve both low- and moderateincome families in a mix which he determines to be appropriate for the area and for viable operation of the project; except that the Secretary shall not permit maintenance of vacancies to await tenants of one income level where tenants of another income level are available.

LOANS FOR HOUSING FOR THE ELDERLY-NEED FOR EXCERPT FROM SENIOR CITIZENS HOUSING ACT OF 1962

[Public Law 87-723, 76 Stat. 670, 12 U.S.C. 1701r]

SEC. 2. The Congress finds that there is a large and growing need for suitable housing for older people both in urban and rural areas.

1 Sec. 210 (c) of Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633, approved August 22, 1974, added a new section "(f)".

Our older citizens face special problems in meeting their housing needs because of the prevalence of modest and limited incomes among the elderly, their difficulty in obtaining liberal long-term home mortgage credit, and their need for housing planned and designed to include features necessary to the safety and convenience of the occupants in a suitable neighborhood environment. The Congress further finds that the present programs for housing the elderly under the Department of Housing and Urban Development have proven the value of Federal credit assistance in this field and at the same time demonstrated the urgent need for an expanded and more comprehensive effort to meet our responsibilities to our senior citizens.

Approved September 28, 1962.

REFINANCING UNDER INTEREST REDUCTION
PAYMENT PROGRAM

EXCERPT FROM HOUSING AND URBAN DEVELOPMENT ACT OF 1968 [Public Law 90-448, 82 Stat. 476, 502, 12 U.S.C. 1715z-1, note]

RENTAL AND COOPERATIVE HOUSING FOR LOWER INCOME FAMILIES

SEC. 201.

(d) The Secretary of Housing and Urban Development is authorized, upon such terms and conditions as he may prescribe, to insure under section 236 (j) of the National Housing Act1 a mortgage meeting the requirements of such section which is given to refinance a mortgage loan made under section 202 of the Housing Act of 1959: Provided, That the application for such insurance is filed with the Secretary on or before the date of project completion, or within such reasonable time thereafter as the Secretary may permit.

Approved August 1, 1968.

1 Interest reduction payment program for lower income families.

§ 401

EXCERPTS FROM THE HOUSING ACT OF 1950

[Public Law 475, 81st Cong.; 64 Stat. 48, 77, 12 U.S.C. 1749]

TITLE IV-HOUSING FOR EDUCATIONAL INSTITUTIONS

FEDERAL ASSISTANCE IN THE FORM OF LOANS OR ANNUAL GRANTS

3

1

SEC. 401.2 (a) To assist educational institutions in providing housing and other educational facilities for students and faculties, the Secretary may make loans of funds to such institutions for the construction or purchase of such facilities or may, as an alternative to all or part of the loan (in the case of any such institution), make annual grants to the institution to reduce the cost of its borrowing from other sources for such construction or purchase: Provided, That no such assistance shall be provided unless (1) the educational institution involved is unable to secure the necessary funds for the construction or purchase from other sources upon terms and conditions equally as favorable as the terms and conditions applicable to loans under this title, and (2) the Secretary finds that any such construction will be undertaken in an economical manner, and that any such facilities are not or will not be of elaborate or extravagant design or materials.

(b) Any educational institution which, prior to the date of enactment of this Act, has contracted for housing or other educational facilities may, in connection therewith, receive loans authorized under this title, as the Secretary may determine: Provided, That no such loan shall be made for any housing or other educational facilities, the construction of which was begun prior to the effective date of this Act, or completed prior to the filing of an application under this title.

1 Sec. 1705 (a), Housing and Urban Development Act of 1968, Public Law 90-448, approved August 1, 1968, 82 Stat. 476, 604, substituted this heading for "Federal Loans". The President's letter of July 18, 1950, to the Housing and Home Finance Administrator, requested that the Administrator "Suspend for the time being commitments for direct loans for the construction of housing by educational institutions", as one of several administrative actions requested in order to conserve building materials for national defense purposes and lessen inflationary tendencies. On December 8, 1950, the President released $40,000,000 for defense-related college housing loans. An additional $60,000,000 was made available for fiscal 1953, $50,000,000 for fiscal 1954 and 1955 each, and $25,000,000 for fiscal 1956, making a cumulative total released of $225,000,000. On August 4, 1953, the Housing Administrator announced the removal of defense restrictions on college housing loans and that colleges would no longer be required to show a defense-related need to qualify for a loan.

2 Sec. 301, Housing Amendments of 1955, Public Law 345, 84th Congress, approved Aug. 11, 1955, 69 Stat. 635, 644, amended subsection (a) to permit loans for other educational facilities in addition to housing, and to provide that a loan could be made unless the educational institution could obtain funds from private lending sources upon terms equally as favorable as the terms of the Government loan. Prior to the 1955 Act, institutions were required to show that they could not secure the funds from private sources upon terms and conditions generally comparable to the terms and conditions applied to Government loans.

Sec. 1705(b), Housing and Urban Development Act of 1968, Public Law 90-448, approved August 1, 1968, 82 Stat. 476, 604, amended subsection (a) to authorize, in addition to loans, annual grants (separately or in combination with loans) to reduce the cost of borrowing from other sources. Provisions were also added authorizing loans or grants for the acquisition and renovation of facilities or the purchase of existing facilities not in need of renovation.

Sec. 8(a), Public Law 90-19, approved May 25, 1967, 81 Stat. 17, 22, substituted "Secretary" for "Administrator" throughout Title IV in order to make it conform to the Department of Housing and Urban Development Act which placed all the functions of the Housing and Home Finance Administrator in the Secretary of Housing and Urban Development.

(c) (1) A loan to an educational institution may be in an amount not exceeding the total development cost of the facility, as determined by the Secretary; shall be secured in such manner and be repaid within such period, not exceeding fifty years,1 as may be determined by him; and with respect to loan contracts under which loan funds have not been fully disbursed prior to the rate of enactment of the College Housing Amendments of 1955 shall bear interest 2 at a rate determined by the Secretary which shall be not more than the lower of (A) 3 per centum per annum, or (B) the total of one-quarter of 1 per centum per annum added to the rate of interest paid by the Secretary on funds obtained from the Secretary of the Treasury as provided in subsection (e) of this section.

(2) Annual grants to an educational institution with respect to any housing or other educational facilities shall be made over a fixed period not exceeding 40 years, and provision for such grants shall be embodied in a contract guaranteeing their payment over such period. Each such grant shall be in an amount equal to the difference between (A) the average annual debt service which would be required to be paid, during the life of the loan, on the amount borrowed from other sources for the construction or purchase of such facilities, and (B) the average annual debt service which the institution would have been required to pay, during the life of the loan, with respect to such amount if the applicable interest rate were the rate specified in paragraph (1) Provided, That the amount on which such grant is based shall be approved by the Secretary but in no event shall exceed the total development cost of the facilities.

(d) (1)1 To obtain funds for loans under subsection (a) of this section, the Secretary may issue and have outstanding at any one time

1 As originally enacted, the term of a loan was limited to 40 years. Sec. 301, Housing Amendments of 1955, Public Law 345, 84th Congress, approved August 11, 1955, 69 Stat. 635, 644, raised the maximum term to 50 years.

2 As originally enacted, the interest rate was fixed at the annual rate of interest specified in the most recently issued bonds of the Federal Government having a maturity of 10 years or more, plus 14 of 1 percent. Sec. 24(b), Housing Amendments of 1953, Public Law 94, 83d Congress, approved June 30, 1953, 67 Stat. 121, 128, amended the interest rate provisions so that the Secretary of the Treasury determined the minimum base rate by estimating the average yield to maturity based on daily closing market bid quotations during the month of May on all outstanding marketable obligations of the U.S. having a maturity date of 15 or more years from May 1, and by adjusting the average yield to the nearest % of 1 percent. A similar determination was made each December for loan contracts approved during the following half-year period.

Sec. 808(b), Housing Act of 1964, Public Law 560, 83d Congress, approved August 2, 1954, 68 Stat. 590, 646, provided that the interest rate would be determined on the basis of the going Federal rate in effect at the time the loan was approved by the Housing Administrator, instead of the time the loan was executed, as previously required.

Sec. 301, Housing Amendments of 1955, Public Law 345, 84th Congress, approved August 11, 1955, 69 Stat. 635, 644, provided that loans would bear interest at a rate of not more than the higher of (1) 24 percent per annum, or (2) the total of 4 of 1 percent per annum added to the rate of interest paid on funds obtained from the Treasury to make the loans. The interest rate paid to the Treasury was not more than the higher of (1) 2% percent per annum, or (2) the average annual interest rate on all interest-bearing obligations of the U.S. then forming a part of the public debt as computed at the end of the fiscal year next preceding the issuance of obligations for college housing loans and adjusted to the nearest % of 1 percent.

Sec. 602, Housing and Urban Development Act of 1965, Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 489, placed a ceiling of 3 percent (or the amount derived under the existing formula, if lower) on the interest rate applicable to college housing loans. 3 Sec. 1705 (c), Housing and Urban Development Act of 1968, Public Law 90-448, approved August 1, 1968, 82 Stat. 476, 604, added paragraph (2).

Immediately prior to amendment by sec. 401, Housing Act of 1961, Public Law 87-70, approved June 30, 1961, 75 Stat. 149, 172, subsec. (d) (1) read as follows:

(d) To obtain funds for loans under subsection (a) of this section, the Administrator may issue and have outstanding at any one time notes and obligations for purchase by the Secretary of the Treasury in an amount not to exceed $1,675,000,000: Provided, That the amount outstanding for other educational facilities, as defined herein, shall not exceed $175,000,000: Provided further, That the amount outstanding for hospitals, referred to in clause (2) of section 404 (b) of this title, shall not exceed $100,000,000."