technical services such as building plans, specifications, construction supervision and inspection, and advice and information. The section authorizes the Secretary and the Housing and Home Finance Administrator to cooperate in research and technical studies in the ruralhousing field and also authorizes the Secretary to utilize (through the Agricultural Extension Service) the facilities of State agencies and educational institutions in furnishing the services and information authorized by this section. SECTION 706 This section requires that the Secretary of Agriculture give preference to veterans in administering the provisions of the title. SECTION 707 This section authorizes the use by the Secretary of Agriculture of local county or parish committees of farmers to examine applications of farmers desiring to obtain the benefits provided by the title and to submit recommendations in appropriate form to the Secretary with respect to each application. The section further enables the Secretary to make the assistance authorized under sections 702 to 705, inclusive, available through the use of local public agencies authorized to assist in providing housing for families in rural areas. SECTION 708 This section vests in the Secretary the power to establish standards of adequate housing necessary for the purpose of operations of the title. It also authorizes him to require that any recipient of financial assistance agree that the housing provided with such assistance shall not be a justification for changing the terms of the lease or occupancy agreement with the occupants of such housing to the latter's disadvantage without the approval of the Secretary. SECTION 709 This section provides the various administrative and related powers necessary in order that the Secretary of Agriculture may administer the program authorized in the preceding sections. SECTION 710 This section provides that the Secretary of Agriculture is to obtain the funds to make loans under the title from the Treasury. Such borrowings are limited to the amounts necessary to make loans not in excess of $25,000,000 on or after July 1, 1948; $50,000,000 on or after July 1, 1949; $75,000,000 on or after July 1, 1950; and $100,000,000 on or after July 1, 1951. SECTION 711 This section authorizes the Secretary to make commitments for contributions or grants pursuant to section 703 or 704 of not to exceed 221⁄2 million dollars on or after July 1, 1948, an additional 5 million dollars on or after July 1, 1949, an additional 71⁄2 million dollars on or after July 1, 1950, and additional amounts of 10 million dollars on or after July 1 of each of the next 10 succeeding years. SECTION 712 This section authorizes the appropriation of the amounts necessary to make the contributions provided for in the title and for such other amounts as may be necessary for the carrying out of the provisions of the preceding sections of the title. TITLE VIII-ADMINISTRATIVE AND MISCELLANEOUS PROVISIONS This title contains administrative and miscellaneous provisions desirable for sound operations of the programs provided in the bill as well as existing programs of the Housing and Home Finance Agency. SECTION 801 Because of statutory limitations in the legislation under which the Housing and Home Finance Agency was established, the salaries of the Housing and Home Finance Administrator, and of each of the heads of the constituent agencies, were fixed at $10,000, even where it meant a reduction from the salaries previously established in the basic enabling legislation under which these agencies operate. In order to cure this situation and to provide compensation more realistically in line with present conditions, the section provides for compensation at the rate of $17,500 per annum for the Housing and Home Finance Administrator, and of $15,000 for the members of the Home Loan Bank Board, the Federal Housing Commissioner, and the Public Housing Commissioner. SECTION 802 In the establishment of the Housing and Home Finance Agency, there were likewise not included, because of the technicalities surrounding the Reorganization Act, various of the administrative provisions that are commonly included in statutes establishing Government agencies. In order to remove possible confusion in this connection, this section would specifically set forth these provisions. (Such provisions are particularly desirable in the case of the Office of the Housing and Home Finance Administrator, representing as it does a new office altogether, and of the Public Housing Administration, because, unlike the other two constituent agencies of the Housing and Home Finance Agency, there were transferred to it functions from several agencies rather than from a single agency.) In addition, the section contains various administrative provisions which experience with respect to the programs being administered have shown to be desirable to meet the needs of such programs. SECTION 803 This section contains the standard provision providing that the provisions of this act shall control in the case of inconsistency with other legislation.. SECTION 804 This is the usual separability clause. ADDITIONS TO, AND MAJOR CHANGES IN, PRESENT PROVISIONS OF S. 866 MADE BY SENATOR FLANDERS' PROPOSED AMENDMENTS A. ADDITIONS 1. Extension and revision of title VI of the National Housing Act Title I of the draft legislation adds provisions for the revision and extension of title VI of the National Housing Act on a transitional basis, with relatively more incentive for the construction of rental housing than for the construction of housing for sale and with safeguards against inflationary impacts. It extends title VI to March 31, 1949. It increases the insurance authorization by $2,000,000,000, with half of the increased amount allocated for rental housing-not less than $800,000,000 for section 608 rental projects and not less than $200,000,000 for section 603 two-, three-, and four-family units. The present statutory basis for insuring loans for section 608 rental housing (i. e., 90 percent of necessary current costs) is retained, subject to provisions which would prevent giving support to further cost increases (i. e., the provisions of section 101 (d) limiting insurance to 90 percent of the estimated replacement cost on the basis of costs prevailing on December 31, 1947, for projects of comparable quality). The statutory basis for insuring loans on section 603 one- to fourfamily dwellings is made less liberal by shifting from the present basis of "necessary current costs" to "value," but the production credit in the form of a 90 percent firm commitment to builders is retained. Cost limitations for section 608 rental housing (now a maximum of $1,800 per room) have been changed to $8,100 per family dwelling unit so as to avoid any tendency to distort design solely for the purpose of increasing the per room count. A similar change is made with respect to the title II, section 207 rental program. Since the extension of title VI is on a transitional basis, most of the S. 866 title V and title VI amendments to title II of the National Housing Act are incorporated in title I of the draft legislation. 2. Other FHA additions The FHA title I insurance authorization has been increased by $10,000,000 so as to afford reasonable assurance that operations thereunder may continue, as apparently intended by the Congress, until the recently extended expiration date of July 1, 1949. Also, the maximum amount of loans for the purpose of financing new construction eligible for insurance under title I has been increased from $3,000 to $4,000. 3. Secondary market Title II of the draft legislation adds provision for a Government secondary market for home-mortgage loans insured under titles II and VI of the National Housing Act or guaranteed under the Servicemen's Readjustment Act of 1944. 54 4. Insurance of loans for working capital prior to regular mortgage loan financing Section 101 (g) of the draft legislation adds provisions for FHA insurance of construction advances in the case of a property on which there are to be located dwellings for not less than 25 families consisting of a group of single-family or two-family dwellings approved for mortgage insurance prior to the beginning of construction. The section permits the location upon the property during the course of construction of a plant for the fabrication of dwellings or sections or parts thereof, and the advances may cover materials delivered to the property or the plant and labor performed, in the plant or on the site, in the fabrication or erection of the dwellings. B. CHANGES The draft legislation also includes certain changes from S. 866. These include the following: 1. Titles II and III-National Housing Commission The elimination of titles I and II relating to the establishment of an over-all housing agency (the National Housing Commission), since such an agency has been provided through the establishment of the Housing and Home Finance Agency in July of last year. 2. Title IV-Housing research The provisions relating to technical housing research have been perfected. 3. Title V-Home Loan Bank Board existing aids Sections 501 to 506 of S. 866 providing for certain improvements in the legislation administered by the Home Loan Bank Board have been eliminated. Sections 501 (b) and 503 (b) authorizing Federal savings and loan associations to make unsecured home repair and improvement loans, and authorizing the Federal home loan banks to make advances upon the security of home mortgages with maturities of up to 25 years (as compared with the previous limitation of 20 years) have been covered by Public Laws 372 and 311, Eightieth Congress, approved, respectively, August 6 and August 1, 1947. Legislation with respect to most of the other Home Loan Bank Board sections of S. 866 has been passed by the House and is pending before the Senate Banking and Currency Committee. Moreover, certain additions to and changes in such pending legislation are now under consideration by the Home Loan Bank Board. Within a relatively short time these matters can be brought before the Senate Banking and Currency Committee for consideration. 4. Title V-Federal Housing Administration existing aids Section 507 (a) relating to the extension of FHA's title I insurance program for home modernization and repair loans has been eliminated since Public Law 120, Eightieth Congress, approved June 26, 1947, extended this program to July 1, 1949. Section 507 (b) extending the maximum maturity of FHA title I home repair and improvement loans from 3 to 5 years has been eliminated since such extension at this time is not regarded as desirable. Section 508 (b) authorizing an increase, where cost levels so require, of up to $1,000 in the maximum mortgage amounts provided for in the case of FHA's section 203 (b) (2) programs has been eliminated since direct increases are now provided for by sections 101 (h), 101 (i), and 101 (k) of the draft legislation. Section 509 (c) relating to deferments of monthly payments under FHA insured mortgages in case of unemployment or misfortune beyond the control of the mortgagor has been eliminated, since the FÍA believes that mortgagees would not generally find such provisions acceptable for inclusion in the mortgage instrument. Section 510 authorizing an extension of the maturity of FHA insured mortgages for a period equal to the veteran's period of military service, where payments were deferred or defaulted during such period of military service, has been eliminated. This provision was first recommended in 1944 in anticipation of the demobilization period, and now appears unnecessary. Section 512 (b) which would have removed the requirement that the FHA Commissioner regulate the rents, rate of return, capital structure, methods of operation, and so forth, in the case of rental properties where the mortgage is $250,000 or under has been eliminated. This conforms to the recent change in the case of section 608 rental properties where a similar procedure, applicable in cases where the mortgage was $200,000 or under, has been eliminated. Section 514 which would have authorized the FHA to charge a fee of up to 1 percent of the mortgage loan (instead of the present onehalf percent) to cover appraisal and inspection costs on rental properties has been eliminated. This was intended to permit the FHA to recover processing costs in cases where the mortgagor availed himself of FHA technical services during construction, but did not proceed with insurance after completion of construction. In order not to increase unnecessarily the cost of rental housing, it is desirable to charge the higher figure only in cases where the loan is not insured, but the difficulties of administration, when thus applied, appear to justify the elimination of this provision. 5. Title VI-Home ownership and rental housing for families of moderate income Section 601 has been eliminated, since it appears to be surplusage. Section 602 (now included as sec. 101 (k) of the draft legislation) authorized FHA insurance of home mortgage loans of not exceeding 95 percent of appraised value or $5,000 (or $6,000 if cost levels so required) with 30-year maturity and interest at not exceeding 4 percent per annum, coupled with a builder's firm commitment of up to 85 percent of appraised value, has been modified as follows: (a) Consistently with the extension of title VI on a transitional basis until March 31, 1949, this liberalized insurance would be made applicable to construction started after March 31, 1949. (b) To avoid any inflationary aspects, it is limited to 90 percent of appraised value or $6,000, and may be increased to 95 percent of appraised value when in the determination of the Administrator such action would not reasonably be expected to contribute to substantial increases in costs and prices of housing for families of moderate income. Section 604 (now included as sec. 401 of the draft legislation) authorized FHA insurance of 90 percent of loans to housing coopera |