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tion is made available, whichever is later. The Director of the Bureau of the Budget shall apportion each such appropriation and shall notify the agency concerned of his action not later than twenty days before the beginning of the fiscal year for which the appropriation is available, or not more than thirty days after the approval of the Act by which such appropriation is made available, whicherer is later. When used in this section, the term “agency” means any executive department, agency, commission, authority, administration, board, or other independent establishment in the executive branch of the Government, including any corporation wholly or partly owned by the United States which is an instrumentality of the United States. Nothing in this subsection shall be so construed as to interfere with the initiation, operation, and administration of agricultural price support programs and on funds (other than funds for administrative expenses) available for price support, surplus removal, and available under section 32 of the Act of August 24, 1935, as amended (7 U.S.C. 612(c)), with respect to agricultural commodities shall be subject to apportionment pursuant to this section. The provisions of this section shall not apply to any corporation which obtains funds for making loans, other than paid in capital funds, without legal liability on the part of the United States.

Tel(1) No apportionment or reapportionment, or request therefor by the head of an agency, which, in the judgment of the officer making or the agency liead requesting such apportionment or reapportionment would indicate a necessity for a deficiency or supplemental estimate shall be made except upon a determination by such officer or agency head, as the case may be, that such action is required because of (A) any laws enacted subsequent to the transmission to the Congress of the estimates for an appropriation which require expenditures beyond administrative control ; or (B) emergencies involving the safety of human life, the protection of property, or the immediate welfare of individnals in cases where an appropriation has been made to enable the United States to make payment of. or contributions toward, sums which are required to be paid to individuals either in specific amounts fixed by law or in accordance with formulae prescribed by law.

(2) In each case of an apportionment or a reapportionment which, in the judgment of the officer making such apportionment or reapportionment, would indicate a necessity for a deficiency or supplemental estimate, sich officer shall immediately submit a detailed report of the facts of the case to the Congress. In transmitting any deficiency or supplemental estimates required on account of any such apportionment or reapportionment, reference shall be made to such report.

if)(1) The officers designated in subsection (d) of this section to make apportionments and reapportionments may exempt from apportionments trust funds and working funds expenditures which have no significant effect on the financial operations of the Government, working capital and revolving funds established for intra governmental operations, receipts from industrial and power operations available under law and any appropriation made spe. cifically for

(1) interest on, or retirement of, the public debt:
(2) payment of claims, judgments, refunds, and draw-backs;
(3) any item determined by the President to be of a confidential nature:

(4) payment under private relief Acts or other laws requiring payments to designated na yees in the total amount of such appropriation :

(5) grants to the States under title I, IV, or X of the Social Security Act, or under any other public assistance title in such Act. (2) The provisions of subsection (C) of this section shall not apply to appropriations to the Senate or House of Representatives or to ans Member, committee, Office (including the office of the Architect of the Capitol), officer, or employee thereof.

(g) Any appropriation which is apportioned or reapportioned pursuant to this section may be divided and subdivided administratively within the limits of such apportionments or reapportionments: The officer having administrative control of any such appropriation available to the legislative branch, the judiciary, or the District of Columbia, and the head of each agency, subject to the approral of the Director of the Bureau of the Budget, shall prescribe, by regulation, a system of administrative control (not inconsistent with any accounting procedures prescribed by or pursuant to law) which shall be designated to (A) restrict obligations or expenditures against each appropriation to the amount of apportionments or reapportionments made for each such appropriation, and (B) enable

such officer or agency head to fix responsibility for the creation of any obligation or the making of any expenditure in excess of an apportionment or reapportionment. In order to have a simplified system for the administrative subdivision of appropriations or funds, each agency shall work toward the objective of financing each operating unit at the highest practical level, from not more than one administrative subdivision for each appropriation or fund affecting such unit.

(h) No officer or employee of the United States shall authorize or create ang obligation or make any expenditure (A) in excess of an apportionment or reapportionment, or (B) in excess of the amount permitted by regulations prescribed pursuant to subsection (g) of this section.

(i) (1) In addition to any penalty or liability under other law, any officer or employee of the United States who shall violate subsection (a), (b), or (h) of this section shall be subjected to appropriate administrative discipline, including when circumstances warrant, suspension from duty without pay or removal from office; and any officer or employee of the lnited States who shall knowingly and willfully violate subsection (a), (b), or (h) of this section shall, upon conviction. be fined not more than $5,000 or imprisoned for not more than two ye:urs, or both.

(21 In the case of a violation of subsection (a), (b), or (h) of this section by an oilicer or employee of an agency, or of the District of Columbia, the head of the al gener concerned or the Commissioners of the District of Columbia, shall immediately report to the President, through the Director of the Bureau of the Budget, and to the Congress all pertinent facts together with a statement of the action taken thereon (31 U.S.C. 665).

Hereafter, any appropriation required to be apportioned pursuant to section 3679 of the Revised Statutes, as amended. may be apportioned on a basis indicating the need for a supplemental or deficiency estimate of appropriation to the extent necessary to permit payment of such pay increases as may be granted those employees (commonly known as Wageboard employees) whose compensation is fixed an adjusted from time to time in accordance with prevailing rates (JC.S.C..3102, 5341), (31 ('.S.C. 60a).

VOTES

Escept as indicated below, this is derived from section 1211 of Public Law 759. S1st Congress (14 Stat. 76.7.

Subscction (e) (i).- The reference to heads of agencies was added by the Act of August 25, 19.77, 71 Stat. 410.

Subsection (g).--The last sentence of the subsection was added by the set of August 1. 1936, 70 Stat. 783.

In addition to the exceptions specifically provided for in the Antideficiency Act. some appropriations or programs have been specifically exempted from the operation of the Act, in whole or in part, by other law.

Senator Ervin. Our last witness for today will be Mr. Lewis Cenker of the Nationalissociation of Home Builders,

Jr. (enker, we appreciate your being with us today.

STATEMENT OF LEWIS CENKER, FIRST VICE PRESIDENT OF THE NATIONAL ASSOCIATION OF HOME BUILDERS; ACCOMPANIED BY BURTON WOOD, GENERAL COUNSEL, AND CARL A. S. COAN, JR.. LEGISLATIVE COUNSEL

Mr. CENKER. Mr. Chairman, members of the several subcommittees. my name is Lewis Cenker. I am a builder from Atlanta, Ga., and I anpear here today as first vice president of the National Association of Home Builders. 'I have with me Burton Wood, our general counsel, and Carli. S. Coan, Jr., our legislative counsel.

I am honored to be here and to share with you our views on the very serious problems created by executive impoundment of funds specifically anthorized and appropriated by the Congress. As the trade association representing the American homebuilding industry. with over 67,500 members in 516 State and local associations through

out this Nation, and as that part of the business community most directly concerned with meeting our national housing goals, I cannot stress too strongly our concern at the disproportionate and unfair ef. fect that the present moratoria and impoundments are having and will have on those programs aimed at housing the American people.

Our association has not considered specific legislative proposals dealing with the problem of impoundment control such as S. 373, the bill before this subcommittee. Therefore, I will not attempt to

analyze or discuss this measure. However, we do concur in the objec1 tires and purposes of such legislation, feeling that there must be some

accountability by the executive department to the Congress, whenever the executive terminates or drastically curtails programs specifically established and funded by the Congress.

Previous administrations and the Congress over a period of years have developed and refined national goals to meet the housing needs of our country. We have continually stressed in our appearances and statements before committees of Congress and before various executive offices, from the White House on down, that only now is this Nation beginning to meet its national housing goals. These goals were established by the 1968 Housing Act and called for a production of 26 million new and rehabilitated units over a 10-year period, 6 million of these for low and moderate income families. This was a valid goal then, and it is a valid one today.

Since the establishment of these goals, it has only been in this past pearthat we began to approach a level of home building which brought us within the realm of achieving them. Last year a record 2,378,000 units were started, of which about 330,000 were subsidized units for low and moderate income families. In 1970 and 1971, low and moderate income housing starts were even higher.

In the fact of this production achievement, we are now confronted by a drastic crippling of this effort by a withholding of subsidy funds already appropriated by Congress to assist these low and moderate income families obtain decent shelter. Other impoundments threaten not just low and moderate income housing, but housing for all segments of our population. I should like to review for you those housingrelated programs which have been suspended or cut back and explore some of the devastating effects which they portend for meeting our housing needs.

The section 235 homeownership and section 236 rental housing programs for lower income families were established by the Housing Act of 1968. Since that time, they have produced over 700,000 units. almost

as many as had been produced in the preceding 30 years. These programs represent the most effective means yet developed to house lower income families who do not have sufficient resources to obtain decent housing on their own. However, without citing any alternatires, the administration has in effect declared them to be failures, primarily because of a few distorted and sensationalized instances of difficulty, and has announced that, for a period of 18 months, none of the contract authority already appropriated by Congress will be used.

I would like to say we have a report on Federal subsidies. It deals with the whole problem of the nature and effectiveness and should be of great interest to you and your colleagues in this area. The President's budget states that there are $399.5 million in approved but unused contract authority that will be impounded. In addition, the President's fiscal 1974 budget calls for no

new contract authorization for the programs-curious, indeed, in light of their successful record to date and the fact that the amounts authorized by Congress for this fiscal year were essentially in accord with the administration's own requests.

All of this takes on added meaning in the area of low-income housing inasmuch as the President has also announced the end for the time being of the public housing and rent supplement programs. His 1974 budget contemplates no additional contract authority request for these programs and all of the available funds for public housing have been committed. The President, thus, by executive fiat, has put an end to 35 years of increasing concern and efforts to relieve the housing plight of the Nation's less fortunate citizens. While the Congress had an active role in developing these efforts, it apparently is to have none in deciding whether they are to continue.

In another area of low-income family housing, the current moratorium is already having a major detrimental effect. The administration's budget for fiscal year 1973 called for $2.14 billion for rural housing loans--the majority of this to be made available for lowincome families. The moratorium cuts this back to $1.7 billion, with the major burden of this $100 million cutback falling on low-income families. Furthermore, the 1974 budget calls for no new loan obligations to be incurred under the low-income housing, rural rental housing, and farm labor housing programs. This represents yet another one-sided termination of a highly successful program fulfilling a high national priority.

One of the most serious inhibitors to home building today is the withholding of building permits for all kinds of housing because of the lack of adequate water and sewer facilities. In community after community all across the country, local officials are imposing building moratoria for all types of housing because present water distribution and sewer and disposal systems simply are not capable of meeting today's standards. Frequently, this arises as a result of stringent water quality standards imposed by the Federal Government.

Congress has long recognized this problem. In the conference report on the Agricultural and Environmental Appropriations Act for fiscal year 1973, Congress directed HUD to use all of the available $500 million for water and sewer grants. This program was frozen with others, as of January 5, with an estimated $100 million still unused, nor is there any contemplated use of the program during fiscal 1974. A similar action was taken with respect to the Agriculture Department's water and waste disposal grant program as of January 8, which has been terminated entirely.

In addition, there has been a cutback by 55 percent in the amount of funds approved hy Congress over a Presidential veto for municipal waste treatment construction under 1972 amendments to the Federal Water Pollution Control Act. The effect of these suspensions, terminations, and drastic cutbacks will be to deny or delay severely the opportunity for housing to be built in many parts of the country for families of all income ranges. A serious situation will become severe, and our efforts to meet our national housing goals more difficult.

Other HUD programs severely crippled by the impoundment actions are the open space and program, the section 312 rehabilitation loan program, and the urban renewal program. These programs, principally aimed at improving the physical and social environment

of our Nation's inner cities, are to be terminated at the end of the fiscal

Year 1973.

In a related area, not dealing with housing programs as such, but having a major effect on the cost of housing, is the action cutting back on the funds available to the Forest Service. These funds cover such areas as timber resource management, forest land management, forest protection and utilization, forest fire control, insect and disease control, and construction of timber harvesting roads and trails. The impoundment and cutback orders for this year involve between $10 and $50 million.

Almost $2 million a week being denied for these essential uses.

Lumber is the single most important product in home building today. It is also the only self-renewing natural resource used in construction. The home building industry is currently faced with the highest lumber prices in its history with no immediate prospect of a decline. This reduction of funds available to increase the productivity of our national forests can only add to the upward pressures on lumber prices.

Our industry shares the national concern over inflation and any weakening of our fiscal stability. As much as any industry, we have suffered from the effects of inflation and its usual accompaniment, high mortgage interests rates and tight money. We, therefore, fully support the President's goal to control inflation, and believe that riscal restraint is necessary. However, if the efforts to control inflation call for a reduction in Federal spending, then such a reduction should be fairly and evenly spread throughout the Federal budget. These reductions should take into consideration high national priorities and should be undertaken in consultation with the Congress.

Housing should not bear a disproportionate share of these impoundments and cut backs. We feel that the current moratoria are inequitable. Low and moderate income families are the ones least able to sustain å reduction in economic assistance-yet they are being asked to bear a major brunt of the current efforts.

We urge the Congress to reassert its role as the enacter and funder of Federal programs. It should also make clear to the administration that programs involving Federal assistance in areas recognized as essential to the continued well-being of the Nation not to be subject to abrupt and arbitrary termination or suspension. Mr. Chairman, thank you for the opportunity to appear before you.

Senator Chiles. We thank you very much for appearing before us today and giving us that statement. Senator Ervin. Senator Ervix. Of course, any particular further program to be continued beyond this expiration date, or whether it should be funded beyond the end of the fiscal year, is a question for Congress to determine, I think-not for the President,

Now, these funds which were appropriated by Congress for carrying out the housing program were frozen--were appropriated for this current fiscal year, and frozen after the current fiscal year was started, and after many of the projects that were funded bị them were begun; is that not true?

Mr. CENKER. Yes. In addition to that, Senator, there is a pipeline quality--there is leadtime, preparation time-and we feel that these have not been given sufficient weight. A lot of homebuilders are well

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