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(2) by adding the following new subsection to section 405:

"(c) No action against the Corporation to enforce a claim for payment of insurance upon an insured account of an insured institution in default shall be brought after the expiration of three years from the date of default unless, within such three-year period, the conservator, receiver, or other legal custodian of the insured institution shall have recognized such insured account as a valid claim against the insured institution and the claim for payment of insurance shall have been presented to the Corporation and its validity denied, in which event the action may be brought within two years from the date of such denial."

SEC. 602. The Federal Home Loan Bank Act, as amended, is hereby amended by striking "$20,000" in section 10 (b) (2) and inserting "$35,000."

SEC. 603. The Home Owners' Loan Act of 1933, as amended, is hereby amended

(1) by striking "$20,000" wherever it appears in the first paragraph of subsection (c) of section 5 and inserting "$35,000"; and

(2) by amending subsection (d) of section 5 to read as follows: "(d) (1) The Board shall have power to enforce this section and rules and regulations made hereunder. In the enforcement of any provision of this section or rules and regulations made hereunder, or any other law or regulation, and in the administration of conservatorships and receiverships as provided in subsection (d) (2) hereof, the Board is authorized to act in its own name and through its own attorneys. The Board shall have power to sue and be sued, complain and defend in any court of competent jurisdiction in the United States or its territories or possessions. It shall by formal resolution state any alleged violation of law or regulation and give written notice to the association concerned of the facts alleged to be such violation, except that the appointment of a Supervisory Representative in Charge, a conservator or a receiver shall be exclusively as provided in subsection (d) (2) hereof. Such association shall have thirty days within which to correct the alleged violation of law or regulation and to perform any legal duty. If the association concerned does not comply with the law or regulation within such period, then the Board shall give such association twenty days written notice of the charges against it and of a time and place at which the Board will conduct a hearing as to such alleged violation of duty. Such hearing shall be in the Federal judicial district of the association unless it consents to another place and shall be conducted by a hearing examiner as is provided by the Administrative Procedure Act. The Board or any member thereof or its designated representative shall have power to administer oaths and affirmations and shall have power to issue subpenas and subpenas duces tecum, and shall issue such at the request of any interested party, and the Board or any interested party may apply to the United States district court of the district where such hearing is designated for the enforcement of such subpena or subpena duces tecum and such courts shall have power to order and require compliance therewith. A record shall be made of such hearing and any interested party shall be entitled to a copy of such record to be furnished by the Board at its reasonable cost. After such hearing and an adjudication by the Board, appeals shall lie as is provided by the Administrative Procedure Act, and the review by the court shall be upon the weight of the evidence. Upon the giving of notice of alleged violation of law or regulation as herein provided, either the Board or the association affected may, within thirty days after the service of said notice, apply to the United States district court for the district where the association is located for a declaratory judgment and an injunction or other relief with respect to such controversy, and said court shall have jurisdiction to adjudicate the same as in other cases and to enforce its orders. The Board may apply to the United States district court of the district where the association affected has its home office for the enforcement of any order of the Board and such court shall have power to enforce any such order which has become final. The Board shall be subject to suit by any Federal savings and loan association with respect to any matter under this section or regulations made thereunder, or any other law or regulation, in the United States district court for the district where the home office of such association is located, and may be served by serving a copy of process on any of its agents and mailing a copy of such process by registered mail, to the Home Loan Bank Board, Washington, District of Columbia.

"(2) The grounds for the appointment of a conservator or receiver for a Federal savings and loan association shall be one or more of the following: (i) insolvency in that the assets of such association are less than its obligations to its creditors and others, including its members; (ii) violation of law or of a regulation; (iii) the concealment of its books, records, or assets or the refusal to submit its books, papers records, or affairs for inspection to any examiner or lawful agent appointed by the Home Loan Bank Board; and (iv) unsafe or unsound operation. The Board shall have exclusive jurisdiction to appoint a Supervisory Representative in Chicago, conservator, or receiver. If, in the opinion of the Board, a ground for the appointment of a conservator or receiver as herein provided exists and the Board determines that an emergency exists requiring immediate action, the Board is authorized to appoint ex parte and without notice a Supervisory Representative in Charge to take charge of said association and its affairs who shall have and exercise all the powers herein provided for conservators and receivers. Unless sooner removed by the Board, such Supervisory Representative in Charge shall hold office until a conservator or receiver, appointed by the Board after notice as herein provided, takes charge of the association and its affairs, or for six months, or until thirty days after the termination of the administrative hearing and final proceedings herein provided, or until sixty days after the final termination of any litigation affecting such temporary appointment, whichever is longest. The Board shall have the power to appoint a conservator or receiver but no such appointment of a conservator or receiver shall be made except pursuant to a formal resolution of the Board stating the grounds therefor and except notice thereof is given to said association stating the grounds therefor and until an opportunity for an administrative hearing thereon is afforded to said association. Such hearing shall be held in accordance with the provisions of the Administrative Procedure Act and shall be subject to review as therein provided and the review by the court shall be upon the weight of the evidence. A conservator shall have all the powers of the members, the directors, and officers of the Federal association and shall be authorized to operate it in its own name or conserve its assets in the manner and to the extent authorized by the Board. The Board shall appoint only the Federal Savings and Loan Insurance Corporation as receiver for any Federal savings and loan association, which shall have power as receiver to buy at its own sale subject to approval by the Board. With the consent of the association expressed by a resolution of the board of directors or of its members, the Board is authorized to appoint a conservator or receiver for a Federal association without notice and without hearing. The Board shall have power to make rules and regulations for the reorganization, merger, and liquidation of Federal associations and for such associations in conservatorship and receivership and for the conduct of conservatorships and receiverships. Whenever a Supervisory Representative in Charge, conservator, or receiver, appointed by the Board pursuant to the provisions of this section, demands possession of the property, business and assets of any association, the refusal of any officer, agent, employee, or director of such association to comply with the demand shall be punishable by a fine of not more than $1,000 or by imprisonment for not more than one year or both by such fine and imprisonment."

TITLE VII-URBAN PLANNING AND RESERVE OF PLANNED PUBLIC

WORKS

URBAN PLANNING

SEC. 701. To facilitate urban planning for smaller communities lacking adequate planning resources, the Administrator is authorized to make planning grants to State planning agencies for the provision of planning assistance (including surveys, land use studies, urban renewal plans, technical services and other planning work, but excluding plans for specific public works) to cities and other municipalities having a population of less than 25,000 according to the latest decennial census. The Administrator is further authorized to make planning grants for similar planning work in metropolitan and reginal areas to official State, metropolitan, or regional planning agencies empowered under State or local laws to perform such planning. Any grant made under this section shall not exceed 50 per centum of the estimated cost of the work

for which the grant is made and shall be subject to terms and conditions prescribed by the Administrator to carry out this section. The Administrator is authorized, notwithstanding the provisions of section 3648 of the Revised Statutes, as amended, to make advance or progress payments on account of any planning grant made under this section. There is hereby authorized to be appropriated not exceeding $5,000,000 to carry out the purposes of this section, and any amounts so appropriated shall remain available until expended.

RESERVE OF PLANNED PUBLIC WORKS

SEC. 702. (a) In order (1) to encourage municipalities and other public agencies to maintain a continuing and adequate reserve of planned public works the construction of which can rapidly be commenced whenever the economic situation may make such action desirable, and (2) to attain maximum economy and efficiency in the planning and construction of local, State, and Federal public works, the Administrator is hereby authorized, during the period of three years commencing on July 1, 1954, to make advances to public agencies from funds available under this section (notwithstanding the provisions of section 3648 of the Revised Statutes, as amended) to aid in financing the cost of engineering and architectural surveys, designs, plans, working drawings, specifications, or other action preliminary to and in preparation for the construction of public works: Provided, That the making of advances hereunder shall not in any way commit the Congress to appropriate funds to assist in financing the construction of any public works so planned.

(b) No advance shall be made hereunder with respect to any individual project unless it conforms to an overall State, local, or regional plan approved by a competent State, local, or regional authority, and unless the public agency formally contracts with the Federal Government to complete the plan preparation promptly and to repay such advance when due.

(c) Advances under this section to any public agency shall be repaid without interest by such agency when the construction of the public works is undertaken or started: Provided, That in the event repayment is not made promptly such unpaid sum shall bear interest at the rate of four percentum per annum from the date of the Government's demand for repayment to the date of payment thereof by the public agency. All sums so repaid shall be covered into the Treasury as miscellaneous receipts.

(d) The Administrator is authorized to prescribe rules and regulations to carry out the purposes of this section.

(e) There is hereby authorized to be appropriated not exceeding $10,000,000 to carry out the purposes of this section, and any amounts so appropriated shall remain available until expended. Not more than 5 per centum of the funds so appropriated shall be expended in any one State.

DEFINITIONS

SEC. 703. As used in this title, (1) the term "State" shall include any State, territory, or possession of the United States, including the District of Columbia; (2) the term "Administrator" shall mean the Housing and Home Finance Administrator; (3) the term "public works" shall include any public works other than housing; and (4) the term "public agency" or "public agencies" shall mean any State, as herein defined, or any public agency or political subdivision therein.

TITLE VIII-MISCELLANEOUS PROVISIONS

SEC. 801. Section 607 of the Act entitled "An Act to expedite the provision of housing in connection with national defense, and for other purposes", approved October 14, 1940, as amended, is hereby amended by adding the following new subsection at the end thereof:

"(g) The Administrator may dispose of any permanent war housing without regard to the preferences in subsections (b) and (2) of this section when he determines that (1) such housing, because of design or lack of amenities, is unsuitable for family dwelling use, or (2) it is being used at the time of disposition for other than dwelling purposes, or (3) it was offered, with preferences substantially similar to those provided in the Housing Act of 1950 (64 Stat. 48), to veterans and occupants prior to enactment of said Act, or (4) it is to be sold with a requirement that it be removed from its present location."

SEC. 802. (a) The Housing and Home Finance Administrator shall, as soon as practicable during each calendar year, make a report to the President for

submission to the Congress on all operations under the jurisdiction of the Housing and Home Finance Agency during the previous calendar year.

(b) Section 311 of "An Act to expedite the provision of housing in connection with national defense, and for other purposes", approved October 14, 1940, as amended; section 6 of "An Act to provide for the advance planning of nonFederal public works", approved October 13, 1949, as amended; and sections 5 and 402 (f) of the National Housing Act, as amended, are hereby repealed. (c) The National Housing Act, as amended, is hereby amended

(1) by striking the heading "ANNUAL REPORT" immediately after section 4 and inserting “TAXATION"; and

(2) by striking from subsection (e) of section 406 the word "Congress" and inserting "Housing and Home Finance Administrator".

(d) The first sentence of section 7 (b) of the United States Housing Act of 1937, as amended, is hereby amended to read as follows: "The annual report of the Housing and Home Finance Administrator to the President for submission to the Congress on the operations of the Housing and Home Finance Agency shall include a report on the operations and expenses of the Authority, including loans, contributions, and grants made or contracted for, low-rent housing and slum-clearance projects undertaken, and the assets and liabilities of the Authority."

(e) Section 106 (a) of the Housing Act of 1949, as amended, is hereby amended by striking "; and" at the end of paragraph (3) thereof, inserting a period in lieu thereof, and striking paragraph (4).

(f) The Federal Home Loan Bank Act, as amended, is hereby amended by striking the second sentence of section 20.

SEC. 803. The Housing and Home Finance Agency, including its constituent agencies, and any other departments or agencies of the Federal Government having powers, functions, or duties with respect to housing under this or any other law shall exercise such powers, functions, or duties in such manner as, consistent with the requirements thereof, will facilitate progress in the reduction of the vulnerability of congested urban areas to enemy attack.

ACT CONTROLLING

SEC. 804. Insofar as the provisions of any other law are inconsistent with the provisions of this Act, the provisions of this Act shall be controlling.

SEPARABILITY

SEC. 805. Except as may be otherwise expressly provided in this Act, all powers and authorities conferred by this Act shall be cumulative and additional to and not in derogation of any powers and authorities otherwise existing. Notwithstanding any other evidences of the intention of Congress, it is hereby declared to be the controlling intent of Congress that if any provisions of this Act, or the application thereof to any persons or circumstances, shall be adjudged by any court of competent jurisdiction to be invalid, such judgment shall not affect, impair, or invalidate the remainder of this Act or its applications to other persons and circumstances.

The CHAIRMAN. We are very glad to have back with us this morning Mr. Albert Cole, who was an outstanding member of this committee at one time and is now the Administrator of the Housing and Home Finance Agency.

We are very pleased to welcome you back before us, Mr. Cole.
Mr. COLE. Thank you, Mr. Chairman.

The CHAIRMAN. With Mr. Cole is Mr. Hollyday, Commissioner of the Federal Housing Administration, and Mr. Fitzpatrick, general counsel for the Housing and Home Finance Agency.

Mr. Cole has a statement and, without objections, Mr. Cole may proceed without interruption with his statement, after which, of course, he will be very glad to submit himself to whatever questioning there may be by the members of the committee.

Mr. COLE. Mr. Chairman, may I make a suggestion. I think the bill is so constituted that we may, at the end of certain segments,

pause for questioning. For instance, as we finish with FHA titles we will so indicate, and ask Mr. Hollyday to make his statement then and we will submit ourselves to questioning on FHA.

Following that the proposals with respect to the secondary mortgage facilities, and then we will submit to questioning upon that. If that is satisfactory.

The CHAIRMAN. The committee will proceed as suggested.

Mr. COLE. Thank you, Mr. Chairman.

The CHAIRMAN. You may proceed, Mr. Cole.

STATEMENT OF HON. ALBERT M. COLE, HOUSING AND HOME FINANCE ADMINISTRATOR

Mr. COLE. Mr. Chairman and members of the committee, I appreciate very much the opportunity to appear before your committee. It is my purpose to extend to you such assistance as I can in your consideration of H. R. 7839, a bill to aid in the provision and improvement of housing, the elimination and prevention of slums, and the conservation and development of urban communities.

H. R. 7839 is a very extensive housing bill. It covers eight titles in its 107 pages. A rather detailed section-by-section suminary of its provisions has been made available to your committee, so I shall try in my statement to cover generally the major features of the bill. I should like to emphasize the fact that this legislation, which embodies a number of measures designed to promote the efforts of our people to acquire good homes and to assist our communities to develop wholesome neighborhoods in which American families can live and prosper, ranks high among the proposals included in the program which President Eisenhower has recommended to the Congress. On January 25 of this year, the President transmitted to the Congress a special message containing his recommendations for housing legislation. In that message the President pointed out that the development of conditions under which every American family can obtain good housing is a major objective of national policy, stating:

It is important for two reasons. First, good housing in good neighborhoods is necessary for good citizenship and good health among our people. Second, a high level of housing construction and vigorous community development are essential to the economic and social well-being of our country. It is, therefore, properly a concern of this Government to insure that opportunities are provided every American family to acquire a good home.

To help find the best ways of meeting this major objective of national policy, the President last fall appointed an Advisory Committee on Government Housing Policies and Programs. Its membership consisted of leading citizens experienced in the problems of housing, mortgage finance, and community development. For the information of your committee we have supplied a list of the names of its members. This Advisory Committee, as you gentlemen know, made an exhaustive study of the existing Federal housing legislation and programs. Also it analyzed numerous proposals looking toward the development of a housing program better adapted to current requirements. I can testify from personal experience that the members of the Advisory Committee worked long and hard on the task assigned to them, for I served as chairman of the committee, and I stayed with

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