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This file contains material relating to Community Development Block Grant Program.
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1/15/77 - Budget Briefing
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1133496
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1/15/77 - Budget Briefing
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This file contains material relating to Community Development Block Grant Program.
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Carla A. Hills Speeches
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1977-01-15
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1977
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1977-01-15
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1977
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The original documents are located in Box 2, folder "1/15/77 - Budget Briefing" of the
Carla A. Hills Speeches at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 2 of the Carla A. Hills Speeches at the Gerald R. Ford Presidential Library
BUDGET BRIEFING
JANUARY 15, 1977
HUD's BUDGET AGAIN SHOWS MAJOR INCREASES IN KEY PROGRAMS
OF HOUSING AND COMMUNITY DEVELOPMENT.
BEFORE OUR BUDGET DIRECTOR, AL KLIMAN, TAKES YOU THROUGH
THE NUMBERS AND SPECIFIC PROGRAMS IN A FEW MINUTES, I WOULD
LIKE TO MENTION A FEW OF THE HIGHLIGHTS OF THIS BUDGET.
FIRST -- COMMUNITY DEVELOPMENT: BASED ON OUR SUCCESSFUL
EXPERIENCE WITH THE COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
OVER THE PAST TWO AND ONE-HALF YEARS SINCE ITS ENACTMENT, WE
PROPOSE A $252 MILLION INCREASE -- BRINGING THAT PROGRAM TO
A $3.5 BILLION LEVEL,
WE ALSO PROPOSE A LEGISLATIVE CHANGE IN THE METHOD OF
DISTRIBUTING BLOCK GRANT FUNDS. THE CURRENT FORMULA DISTRIBUTES
FUNDS BASED ON POVERTY, POPULATION, AND OVERCROWDED HOUSING,
WHICH ADEQUATELY RESPONDS TO THE COMMUNITY DEVELOPMENT NEEDS
OF NEWER, EXPANDING COMMUNITIES.
BUT OUR STUDY AND THE STUDY CONDUCTED BY THE BROOKINGS
INSTITUTION DEMONSTRATES THAT THE CURRENT FORMULA FAILS TO
TAKE INTO ACCOUNT THE DIFFERENT NEEDS OF OLDER CITIES WITH
DECLINING POPULATION AND DETERIORATING PHYSICAL STOCK,
FORD
GERALD
-2-
THESE OLDER CITIES HAVE BEEN "HELD HARMLESS" OVER THE
PAST THREE YEARS, AT THEIR LEVEL OF PARTICIPATION IN PRIOR
CATEGORICAL PROGRAMS, UNDER PRESENT LEGISLATION THE HOLD
HARMLESS WOULD PHASE OUT OVER THE NEXT THREE YEARS -- WITH
THE RESULT THAT OLDER CITIES WOULD RECEIVE SUBSTANTIALLY
FEWER FUNDS,
To ADDRESS THE SPECIAL NEEDS OF THESE OLDER CITIES, AND
TO AVOID THE INEQUITIES ATTENDING A HOLD-HARMLESS EXTENSION,
WE ARE PROPOSING AN ALTERNATIVE FORMULA, WHICH IS BASED ON
AGE OF HOUSING STOCK, POVERTY POPULATION, AND LOSS OF
POPULATION BETWEEN 1960 AND 1973. UNDER OUR PROPOSAL, A
COMMUNITY'S BLOCK GRANT WILL BE COMPUTED UNDER WHICHEVER
FORMULA PROVIDES IT WITH THE HIGHER LEVEL OF FUNDING, WE
BELIEVE THAT THIS TWO-FORMULA APPROACH IS THE MOST EQUITABLE
WAY TO DISTRIBUTE AN IMPORTANT, BUT LIMITED RESOURCE, WE
HOPE THAT CONGRESS AND THE NEW ADMINISTRATION WILL GIVE IT
SERIOUS CONSIDERATION,
SECOND -- HOUSING: THE 1978 BUDGET ONCE AGAIN PROPOSES
SUBSIDIES FOR 500,000 UNITS OF HOUSING, THIS YEAR, AS YOU
KNOW, WE WILL NOT BE ABLE TO MAKE THAT GOAL IN 1977 PRIMARILY
BECAUSE OF NEARLY A 25 PERCENT CONGRESSIONAL CUTBACK IN
REQUESTED FUNDS AND EARMARKS IN OUR HOUSING FUNDS,
-3-
As A MAJOR INNOVATION, WE ARE PROPOSING TO MOVE THE
SECTION 8 PROGRAM MORE TO A BLOCK GRANT APPROACH, GIVING
COMMUNITIES FREEDOM TO CHOOSE NEW, SUBSTANTIALLY REHABILITATED,
OR EXISTING UNITS. To DO THIS, WE WILL PROPOSE LEGISLATION.
AT THE SAME TIME, WE WILL ASK THE CONGRESS TO ENACT BUDGET
AUTHORITY FOR THE PROGRAM -- WITHOUT THE ADDED CONSTRAINT
OF CONTRACT AUTHORITY.
THIRD -- IN FHA PROGRAMS: WE PLAN MAJOR REFORMS IN
THE WAY WE CARRY OUT OUR FHA PROGRAM ACTIVITIES.
WE PROPOSE THAT ALL FHA PROGRAMS BE ACTUARIALLY SOUND
WITHIN THE CONFINES OF EXISTING LAW. WE PLAN TO TERMINATE
TWO PROGRAMS, 221(p)(2) AND 223(E), THAT CANNOT BE MADE SOUND
AND IMPLEMENT IMPROVEMENTS.
WE PLAN TO EXTEND THE HOMEOWNERSHIP COUNSELLING PROGRAM
TO MAKE COUNSELLING AVAILABLE TO ALL OWNERS OF FHA-INSURED
HOMES WHO FALL BEHIND IN THEIR MONTHLY PAYMENTS.
AND, WE PROPOSE TO TRIPLE OUR VERY SUCCESSFUL URBAN
HOMESTEADING PROGRAM,
-4-
FOURTH -- WITH RESPECT TO STAFF: WE ARE ASKING FOR THE
ADDITION OF 894 FULL-TIME STAFF so THAT HUD CAN EFFICIENTLY
CARRY OUT ITS BROAD RANGE OF ACTIVITIES.
WE WILL HAVE 3 MILLION UNITS OF HOUSING RECEIVING FEDERAL
SUBSIDIES BY THE END OF 1978. WE WILL BE DELIVERING BLOCK
GRANT ASSISTANCE TO OVER 5,000 COMMUNITIES. WE WILL HAVE
NEARLY $100 BILLION IN FHA MORTGAGE INSURANCE IN FORCE FOR
NEARLY 6.5 MILLION UNITS. WE WILL HAVE OVER 300,000 UNITS
OF PROPERTIES OR MORTGAGES IN INVENTORY. AND, WE WILL HAVE
OVER $43.7 BILLION IN FLOOD INSURANCE OUTSTANDING.
I HOPE THAT THE CONGRESS WILL SEE FIT TO PROVIDE THE STAFF
NEEDED TO DISCHARGE THESE AS WELL AS ITS OTHER SUBSTANTIAL AND
IMPORTANT RESPONSIBILITIES.
OF COURSE, NOT EVERYTHING IS INCREASING IN THIS BUDGET.
WE ARE PROPOSING A DECREASE IN THE 701 PROGRAM, TARGETING
FUNDS TO AREA- lide PLANNING ORGANIZATIONS, WHICH DO NOT RECEIVE
COMMUNITY DEVELOPMENT BLOCK GRANTS,