Statement of Administration Policy: S. 825 - Omnibus Housing Bill

(Senate)
(Cranston (D) CA)

The Administration strongly opposes S. 825, the omnibus housing authorization bill because it does not contain important administration initiatives and includes numerous objectionable provisions.

The bill is objectionable because:

— it would add $2.7 billion in outlays to the President's Budget for fiscal year 1988 and $19.1 billion in outlays over fiscal years 1988-92;

— it does not permanently authorize a free-standing housing voucher program for HUD and the Farmers Home Administration (FmHA); instead, it merely continues most of the current, less efficient FmHA and Section 8 housing subsidy programs;

— it does not establish a fully operational Comprehensive Modernization Grant program for public housing;

— it does not authorize new housing construction under the Community Development Block Grant program;

— it establishes a new program (Nehemiah grants) to subsidize home purchases by middle-income families in a few cities at a time when limited Federal housing resources should be targeted on helping low-income households afford decent quality rental housing and when low mortgage interest rates qualify most middle-income families for FHA financing;

— it imposes restrictions on the administration of the Section 8 Existing Certificate Program which would needlessly increase administtative fees paid to public housing authorities, thereby reducing funds available to assist poor families. At the same time the bill ignores the administration's proposed reforms that would improve the Section 8 certificate program; and

— it fails to terminate several outmoded and expensive programs which the administration strongly opposes, including the Department of Agriculture's rural housing authorities, the Solar Energy and Energy Conservation Bank, and the Section 312 Rehabilitation Loan program.

The Senate bill also continues and expands the Urban Development Action Grant and Rental Housing Development Grant programs, which waste Federal funds on commercial and residential development projects that should be left to the private sector to finance.

On March 10, 1987, the administration transmitted legislation (the "Housing and Community Development Act of 1987") that would fully implement the administration's proposals. It is that bill which the Senate should pass.