October 1981 Recommendations of the President's Commission on Housing

GAO reviewed the interim report made by the President's Commission on Housing to assist Congress in its deliberations on the merits of the changes recommended by the Commission, because the recommendations could have far-reaching effects on future housing policy.

GAO found that the Commission recommended a system of consumer housing grants or vouchers to be provided directly to families as the primary Federal subsidy program for low-income households. These grants would be targeted to the poorest families to enable them to live in standard quality units. Recognizing that housing may be inadequate in some markets, the Commission recommended several actions to expand the housing supply. GAO expressed the following concerns about the recommendations: (1) the willingness of local governments to undertake new construction without additional funding, and how new construction can best be targeted to the needy and to eligible activities; (2) the cost to taxpayers, effects on State and local governments' financing activities, and the effectiveness in benefiting low- and moderate-income families are crucial to decisons on mortgage bonds; (3) how well a tax credit would serve low-income households and the possible displacement of low-income households; (4) the Federal role in encouraging private participation and how groups should be selected for funding; (5) the impact of eliminating legal obstacles to housing investment by pension funds; (6) who would benefit from a tax-free method for saving toward a downpayment; and (7) who would benefit from a Federal Housing Administration insurance program.