DEPARTMENT OF HOUSING AND URBAN DEPARTMENT; SPACE, SCIENCE, VETERANS, AND CERTAIN OTHER INDEPENDENT AGENCIES APPROPRIATION BILL, 1975

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75B00380R000700040002-3
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 53
• Document Creation Date: December 16, 2016
• Document Release Date: May 19, 2005
• Sequence Number: 2
• Publication Date: August 1, 1974
• Content Type: REPORT

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93D CONGRESS SENATE REPORT
2d Session j No. 93-1056
DEPARTMENT OF HOUSING AND URBAN DEVELOP-
MENT; SPACE, SCIENCE, VETERANS, AND CERTAIN
OTHER INDEPENDENT AGENCIES APPROPRIATIONS
BILL, 1975
Mr. PRO%MIRE, from the Committee on Appropriations,
submitted the following
REPORT
The Committee on Appropriations, to which was referred the bill
(H.R. 15572) making appropriations for the Department of Housing
and Urban Development; for space, science, veterans, and certain
other independent executive agencies, boards, commissions, corpora-
tions, and offices for the fiscal year ending June 30, 1975, and for other
purposes, reports the same to the Senate with various amendments
and presents herewith information relative to the changes made.
Amount of bill as passed House__________________ $20,846,332,000
Amended estimates not considered by House_______ 618, 962, 000
21, 465, 294, 000
Amount of decrease by Senate____________________ 168, 409, 000
Amount of bill as reported to Senate__________ 21, 296, 885, 000
Amount of appropriations, 1974__________________ 20, 634, 036, 000
Amount of budget estimate, 1975_________________ 21, 436, 813, 000
Under the estimates for 1975_________________ 139, 928, 000
Over the appropriations for 1974_____________ 483, 849, 000
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GENERAL STATEMENT
The Committee recommends $21,296,885,000 in new budget (obliga-
tional) authority for the Department of Housing and Urban Devel-
opment, the National Aeronautical and Space Administration, the Na-
tional Science Foundation, the Veterans Administration and eight
other independent agencies. This sum is $139,928,000 below the budget
estimates considered by the Committee and $450,533,000 over the sum
recommended in the House bill. The committee considered estimates
aggregating $618,962,000 which were not considered by the House,
consequently the slum recommended by the committee is $168,409,000
less than House allowance.
On the opposite page there is a summary table indicating the
amounts recommended in the bill and a comparison with the appro-
priations for fiscal year 1974, the budget estimate for 1975 and the
amount contained in the House bill.
Concurring with the action of the House, the Committee has de-
ferred consideration of an additional $2,175,000,000 requested for a
Community Development Grant Program, pending final Congres-
sional action on the Housing and the Urban Development Act of
1974.
In Title I of the bill, which covers the items for the Department
of Housing and Urban Development, the Committee recommends an
appropriation of $3,035,002,000, which sum is $131,951,000 less than
the budget estimate and $175,420,000 under the House allowance. I7.i-
cluded in the sum made available for the Department is $325,000,000
for the Urban Renewal programs and Model Cities. Under pending
legislation, these aforementioned categorical grant programs will be
replaced by some type of Community Development Block Grant pro-
gram, presently being considered by a Conference Committee of the
Banking and Urban Affairs Committees of the Senate and the Bank-
ing and Currency Committee of the House of Representatives. In this
connection, the Committee was informed that if this legislation is
enacted, the Department of Housing and Urban Development would
be prepared to put into effect a Community Development Block Grant
program by January 1, 1975.
For the Space Programs, the Committee recommends an appro-
priation of $3,242,694,000 which is the same as the budget estimate and
$39,644,000 over the House allowance.
For the National Science Foundation, the Committee recommends
an appropriation of $675,000,000 which is $8,200,000 over the sum
recommended by the House, but $6,400,000 below the budget estimate.
More than 65 percent of the sum recommended by the Committee
of new budget obligational authority is for the budget of the Veterans'
Administration which totals $14,000,772,000. Of this amount, $7,283,-
000,000 or more than 50 percent is for Compensation and Pensions for
veterans and widows and their survivors; $2,676,000,000 is for Re-
adjustment Benefits and $3,187,644,000 is for the medical care of our
Nation's veterans.
The Committee has concurred with the House and has recommended
an increase above the budget for the Federal Communications and the
Securities and Exchange Commissions, in order to insure that these
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very important watchdogs of the public welfare will be able to more
effectively meet, their very demanding and expanding workloads.
For the Selective Service System, the Committee recommends an
appropriation of $38,500,000, which is $8,663,000 hiss than the budget
estimate and $7,963,000 under the amount contained in the House bill.
Once again, the Committee considered providing minimal amount of
funds in order to terminate the Selective Service System. However,
this action would amount to an effective repeal of the Selective Serv-
ice System statute and in the opinion of the Committee, it was felt that
if. the act is to be repealed, it should be acconr,Dlished through the
legislative process.
The Committee has also concurred with the House by incorporating
a flat 10 percent reduction from the sum requested by the Department
and agencies for the payment of space rental provisions levied by the
General Services Administration, in accordance with the Public Build-
ings Amendments of 1972, Public Law 92-313, approved June 16,
1972. In concurring with the House action, the Committee also felt
that the 10 percent reduction will have the effect of bringing the
charges imposed by the General Services Administration in conson-
ance with the costs of services provided.
A 11 of the appropriations recommended by the Committee have been
duly authorized by the Congress except the National Science Founda-
tion which is pending in a conference committee and certain items con-
tained in Title I of the bill for the Department of Housing and Urban
Development. In this connection, the Senate passed an Omnibus Hous-
ing Bill, S.3066, last March, which fully authorizes the appropriations
recommended herein for the Department. The House also passed a
I lousing and I Trban Development Act, H.R. 15361, during the past
month and at this time-there being considerable differences between
the two versions-the bills are being considered by a Conference
Committee.
mittee.
The budget outlays (expenditures) for the Department and other
agencies covered in this bill are estimated at $23,114,000,000 in FY
1975. The Committee recommendations are expected to reduce this
total by approximately $100,000,000, for a total of $23,014,000,000.
PP;RMANENT OtirT eArION AIITiIORITY--FEDERAr, FUNDS AND TRUST
FUNDS
Considerable sums are provided the Department and other agencies
through so-called "back door" financing, which is authority granted
by permanent legislation to borrow from the Treasury for certain
insurance and guaranty programs, and through so-called "side door"
financing, better known as contract authority for certain veteran and
subsidized housing programs. The estimates for this authority aggre-
gated $1,085,106,000 in Federal funds and $902,438,000 in trust funds
for FY 1975 and are tabulated in the tables appearing at the end of
this report.
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LIMITATION ON VEHICLE USE
The Committee has added a provision to the bill which in effect
restates existing law and restricts the usage of government vehicles.
Section 638a of Title 31 of the United States Code prohibits the use
of government vehicles for other than "official purposes." It also states
that "official purposes" shall not include the transportation of govern-
ment officers and employees between their domiciles and their places
of employment.
The exceptions to this prohibition are extremely limited and include
the President and his Cabinet, medical doctors on out-patient duty,
and those employees engaged in field work who live far from their
headquarters.
The hearings of this Committee over a two year period indicate that
this prohibition is violated by almost every agency under its jurisdic-
tion, for which various excuses are given.
It was claimed by one non-Cabinet official that he was justified in
being driven to and from his home in McLean, Virginia because he
was on "field work." Others stated that since Congress in the past had
provided funds for cars and drivers we have acquiesced in the practice
and the clear and obvious prohibition found in the law does not apply.
In order that there may be no doubt as to the position of this Com-
mittee that existing law must be observed, language was added to the
bill stating that none of the funds in the act may be expended in
violation of Section 638a of Title 31 and Section 101 of Title 5, USC.
While it may seem to be unnecessary to state that the existing law must
be carried out, it is vitally necessary because of the excuses and
legerdemain of the officials involved.
The only officer to whom such limitation would not apply in this
bill would be the Secretary of Housing and Urban Development who
is specifically excluded by the provisions of Title 5, Section 101 of
the United States Code, as a Cabinet officer. No other official is ex-
cluded from the provisions of the law.
The Committee also directs the Comptroller General of the United
States to determine that, the provisions of the law and of this AcL
are scrupulously adhered to and to exercise such authority as he has
to see that the provisions of Section 638a are carried out.
Section 638a provides for the suspension or removal of any officer
or employee who willfully uses or authorizes the use of any vehicle
to transport officials between their domiciles and places of employment.
As a result of the activities of this Committee and its Members,
considerable progress has been made in reducing the number of limo-
sines (Class VI, V, and IV cars) in Washington. We have been less
successful in preventing the abuse of Section 638a. What we are too
often seeing now is chauffeur driven Pintos instead of chauffeur driven
Cadillacs.
In addition to the fundamental proposition that the law should be
obeyed there are two additional and compelling reasons why driving
officials to and from their homes is wrong. First, during this period of
high fuel prices and shortages, it means a doubling of the mileage.
The car goes both ways twice in a single day. Second, our hearing
established that the average annual earnings, including overtime, of
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the chauffeurs is about $15,000. In one case it was 120,000 a year. 'I'h is
is an absolutely unnecessary espouse at a time of rampaging and
donbie digit inflation.
The. provision in the bill as well as this report language are designed
to leave no question that it is the intention of t .lis Committee to see
t.ltat the law is obeyed.
'l'he Committee concurs with the Ilouse and recommends that the
General Provisions applicable to the Department and agencies in fiscal
year 1974 be continued in fiscal year 1975.
Also, the Committee agrees with the Mouse rued adds a new Section
10:1, relating to the reimbursement to be made to the General Services
Acbitinistration as previously discussed in this report.
li urther, the Committee has added a new Section 406, which pro-
hibits the use of airy funds approp:'iated in the bill by the Central
Inteiilgence Agency.
Also added by the Committee is at new Section 407, which places
certain restrictions on the use of Government vehicles.
1)P,l'ARTIVIENT OF 1IOVSIN'G A I) l 1liAti
DEVELOP ME-NT
Tin Cummittee is distressed and deeply concerned by the ~ldnrin-
iFiratiou's action to abandon our nation's historic housing program.
In 1949. the Congress declared our policy to provide a decent home
in ;i suitable living environment for every A,iterican family.
it 1968. Congress set a housing goal of 2.(; million housing units a.
year For 10 years of which (100,000 were to be or low and moderate
income families.
iii ,lanuurv 197;, the Administration froze virtually all new starts
Cor low and moderate income families. Some 17 housing programs or
pro.-rams closely associated with housing were stopped. Except for
milts already in the pipelitres, programs for lots- income housing were
abandoned, and programs for moderate income Lousing were aban-
dcimed as well. This has resulted in additional families in the lower 40
to 0 percent of American income groups being denied access to public
horsing or the ability to buy a new home.
hxarerbatimm this situation, due to exceedingly high interest rates.
apliroxirnately 70 percent of the American people under private enter-
prise and Conventional housing programs hav,,e also been unable to
purchase new homes.
lnsi.oad of a total of 2.(i million housing ,,,its a year, the annual
rate [or the first half of 1974 was about 1.5 million units, or over a
million units below the national housing goals prornnlgated by the
Congress.
i ioinebuyers. builders, thrift institutions. and those, associated
wlritlt the housing industry-furniture, durable goods, heating and
cooling, among others-have felt the housing moratorium pinch.
The Committee feels that the Acliiiiiiistration has justified its actions
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for a variety of unsupported reasons. Among other things, it has
claimed that the programs were not achieving the goals set by the
Congress, but by no stretch of the imagination is that correct.
Public housing, for all its particular difficulties, is highly popular
and a badly needed program. The waiting lists are exceedingly long.
The vacancy rates are exceedingly low. Thus, it may be concluded
that public housing provides, better housing to millions of Americans,
than they could otherwise afford or are now getting.
The Sections 235 and 236 programs suffered from both HUD mis-
management, and actual corruption, rather than from any inherent
defects in the programs. In cities with good HUD management, such
as Milwaukee, the program was a great success. In cities with rampant
corruption among housing officials, it, along with other HUD pro-
grams, failed. But the failures in certain cities were not peculiar to
Sections 235 and 236 and, in fact, these programs were not the main
ones affected or which failed, contrary to the opinion of the Depart-
ment and some judicial mistakes of fact. The Department blamed
the programs instead of its own mismanagement. As a consequence of
this mismanagement, over 400 indictments have been handed down in
housing fraud cases.
Over 10 percent of the total defaults in the Section 235 program
were in two cities, Seattle and Dallas where there was serious unem-
ployment stemming from cutbacks in the air and space industries.
In the State of Wisconsin, 97 percent of those assisted have been
successful.
In the country as a whole, HUD studies show that the Section 235
program is actuarially sound. There are now 350,000 Section 235
homeowners making their monthly payments. The actual number of
defaults has not exceeded the number anticipated and the insurance
reserves have covered anticipated claims. By any measurement, the
program has been a major success in attaining the objective of assist-
ing those with incomes well below the national median.
More than two-thirds of those receiving assistance receive lower
subsidies each year because their incomes are rising, which was a
major aim of the program. Some 50,000 Section 235 homebuyers have
gone off subsidy altogether and, in the Committee's opinion, these are
distinct measures of program success.
The Department has argued that if not everyone could be subsi-
dized under the program. no one should be subsidized. Evidently, they
halted the program out of policy distaste rather than from factual
evidence.
We are now awaiting action for new and substitute programs. These
were delayed by HUD's failure to finish its studies in a timely fashion
and to recommend any program at all until September, 1973.
The Department now wishes to rely entirely on what is called the
new Section 23 program, a program of leased housing to replace the
conventional public housing program, and Sections 235 and 236.
The Committee feels that it would be a tragic error to take this
course. First, Section 23 may not work. Second, if it does work, it
could take a very long time to go into effect. Third, even if it works,
it may not do two important things, namely, service the kind of low
income families that public housing helped, and build in the regions
or areas where housing is most needed.
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Under Section 23, the builders become the housing managers. It
would seem that since they must rent out the units, they will seek the
elderly, those without children, and. the upper reaches of low and mod-
ern.te income families.
The large poor families and the very poor families, for whom public
housing was such it great program, may well be left out in the cold.
For all these reasons, we should not accept the abandonment of the
traditional programs as the price, for Section 23. The traditional pro-
grams and Section 23 should be implemented concurrently.
I lopefully this will be the result of the legislative conference now
taking place between the House and the Senate concerning future
housing policy and programs. When the pending legislation is finally
agreed to, this Committee will examine the Administration's funding
request to carry out the will of the Congress.
HOUSING PRODiTCTION AND MORTGAGE CREDIT PROGRAMS
SALARIES AND EXPENSES. HOUSING PRODUCTION A Ni) MORTGAGE CREDIT
PROGRAMS
Appropriation, 1074-------------------------------------------- $5, 246, 000
Amended budget estimate ---------------- ------------------------ 14, 340, 000
House allowance ------------------------------------------------- 14, 340,000
Committee recommendation ---- ----------------------------------- 12, 500, 000
For salaries and expenses of the Housing Production and Mortgage
Credit Programs, the Committee recommends an appropriation of
$12,500,000 which is $1?840,000 less than the House and the budget
estimate.
The initial budget estimate totaled $11,200,000. An additional
$3,140,000 was requested in the amended budget, for the purpose of
adding 227 additional positions (167 man-years) to handle the added
workload in applications in the revised Section 23 Leased Housing
Program. These additional positions will be filled in the field offices
of the Department.
In addition to the new budget obligational authority made available,
the sum of $2,470,000 is anticipated to be derived from fees and will
also be used to fund the salaries and expenses in this account, making
a total of $14,970,000 available for this item in fiscal 1975.
The Commit tee recognizes that the Department expects to rely
heavily on it revised public housing leasing program to provide hous-
ing in private accommodations for low income families. This pro-
gram, when used in conjunction with mortgage financing supplied
by state housing finance agencies, holds some promise. However, in the
opinion of this Committee, the leasing program should not be viewed
as a substitutes for the traditional public housing program, as the