Title 42 — The Public Health and WelfareRelease 119-73not60
§1586 Sale of Specific Housing Projects
Title 42 › Chapter 9— HOUSING OF PERSONS ENGAGED IN NATIONAL DEFENSE › Subchapter VII— DISPOSAL OF WAR AND VETERANS’ HOUSING › § 1586
Summary
The Secretary of Housing and Urban Development may transfer ownership of certain housing projects listed in the law to the local public housing agencies named. To do that, three things must happen: by January 30, 1953 the city or county must ask for the transfer and the local housing agency must show HUD there is a need for low-rent housing not met by private builders; HUD must decide the project will help meet that need and is suitable for low-rent use; and by June 30, 1953 the local government and the housing agency must sign agreements with each other and with HUD about local cooperation and payments in lieu of taxes within the limits below. After transfer the project becomes low-rent housing under the United States Housing Act of 1937. The housing agency’s agreement with HUD must require that the project be run as low-rent housing for 40 years unless HUD and the agency agree it is no longer suitable, in which case the agency may sell it and must pay the net proceeds to HUD or use them for repairs. The agency must start within six months to remove tenants who are ineligible under the 1937 Act and finish within 18 months (military personnel named by the Secretary of Defense are exempt until 18 months after transfer). Each year the agency must pay HUD any income left after paying operating costs, allowed payments in lieu of taxes, approved reserves, and approved debt payments (consolidated projects have a special rule). The project is exempt from local taxes, but for the tax year of transfer and the next year payments in lieu may equal normal property taxes, and after that such payments may not exceed 10% of the project’s annual shelter rents. Tenant selection must follow the 1937 Act’s preferences and, for one year after transfer, must give the military preferences the Secretary of Defense directs. If the agency seriously defaults, HUD can require the agency to transfer title or give possession to HUD, which may run the project until HUD is satisfied the problems are fixed and then return it. All payments to HUD under these rules are turned into the Treasury as miscellaneous receipts at the end of each fiscal year.
Full Legal Text
Title 42, §1586
The Public Health and Welfare — Source: USLM XML via OLRC
(a)The Secretary of Housing and Urban Development is specifically authorized to convey the following housing projects to the following local public housing agencies respectively, if—
(1)on or before January 30, 1953, (i) the conveyance is requested by the governing body of the municipality or county and (ii) the public housing agency has demonstrated to the satisfaction of the Secretary of Housing and Urban Development that there is a need for low-rent housing (as such term is defined in the United States Housing Act of 1937 [42 U.S.C. 1437 et seq.]) within the area of operation of such public housing agency which is not being met by private enterprise;
(2)the Secretary of Housing and Urban Development determines that the project requested will meet such need in whole or in part, and is suitable for low-rent housing use; and
(3)on or before June 30, 1953, the governing body of the municipality or county enters into an agreement with the public housing agency (satisfactory to the Secretary of Housing and Urban Development) providing for local cooperation and payments in lieu of taxes not in excess of the amount permitted by subsection (c)(5) of this section, and the public housing agency enters into an agreement with the Secretary of Housing and Urban Development (in accordance with subsection (c) of this section) or for the administration of the project: StateProject numberLocal public housing agency Alabama1041Housing Authority of District of Birmingham. 1061Housing Authority of Greater Gadsden. 1062Housing Authority of Greater Gadsden. 1031Housing Board of Mobile. 1033Housing Board of Mobile. 1034Housing Board of Mobile. 1035Housing Board of Mobile. 1036Housing Board of Mobile. 1101Housing Board of Mobile. 1102Housing Board of Mobile. 1072Housing Authority of Sylacauga. 1076Housing Authority of Sylacauga. 1073Housing Authority of City of Talladega. Arkansas3023Housing Authority of City of Conway. California4031Housing Authority of City of Fresno. 4161Housing Authority of County of Kern. 4141Housing Authority of County of Kern. 4103Housing Authority of City of Los Angeles. 4104Housing Authority of City of Los Angeles. 4108Housing Authority of City of Los Angeles. 4121Housing Authority of City of Paso Robles. 4171Housing Authority of City of Richmond. 4174Housing Authority of City of Richmond. Connecticut6091Housing Authority of City of Bristol. 6024Housing Authority of Town of East Hartford. 6031Housing Authority of City of New Britain. 6032Housing Authority of City of New Britain. 6101Housing Authority of City of New Haven. 6041Housing Authority of City of Waterbury. 6213Housing Authority of City of Waterbury. District of Columbia49012National Capital Housing Authority. 49017National Capital Housing Authority. 49044National Capital Housing Authority. Florida8052Housing Authority of City of Jacksonville. 8121Housing Authority of City of Lakeland. 8062Housing Authority of City of Miami. 8011Housing Authority of City of Orlando. 8082Housing Authority of City of Pensacola. 8084Housing Authority of City of Pensacola. 8085Housing Authority of City of Pensacola. 8131Housing Authority of City of Sebring. 8041Housing Authority of City of West Palm Beach. Georgia9071Housing Authority of City of Albany. 9061Housing Authority of Macon. 9063Housing Authority of Macon. 9041Housing Authority of Savannah. 9042Housing Authority of Savannah. 9043Housing Authority of Savannah. Illinois11081Madison County Housing Authority. 11082Madison County Housing Authority. 11111Winnebago County Housing Authority. 11112Winnebago County Housing Authority. Indiana12071Housing Authority of City of Fort Wayne. 12021Housing Authority of City of South Bend. Louisiana16051Housing Authority of Parish of East Baton Rouge. Maryland18095Housing Authority of Baltimore City. 18096Housing Authority of Baltimore City. 18097Housing Authority of Baltimore City. 18098Housing Authority of Baltimore City. Massachusetts19051Boston Housing Authority. 19021Chicopee Housing Authority. 19022Chicopee Housing Authority. 19061Pittsfield Housing Authority. 19023Springfield Housing Authority. Michigan20042Housing Commission of Detroit. Nevada26021Housing Authority of City of Las Vegas. New Hampshire27021Housing Authority of City of Manchester. New Jersey28044Housing Authority of City of Camden. 28021Housing Authority of City of Long Branch. 28072Housing Authority of City of Newark. 28111Housing Authority of Town of Phillipsburg. New York30031Buffalo Municipal Housing Authority. 30032Buffalo Municipal Housing Authority. 30042Elmira Housing Authority. 30033Lackawanna Municipal Housing Authority. 30039Lackawanna Municipal Housing Authority. 30034Niagara Falls Housing Authority. 30071Niagara Falls Housing Authority. 30082Massena Housing Authority. North Carolina31023Housing Authority of City of Wilmington. 31024Housing Authority of City of Wilmington. Ohio33031Canton Metropolitan Housing Authority. 33033Canton Metropolitan Housing Authority. 33021Cincinnati Metropolitan Housing Authority. 33071Cleveland Metropolitan Housing Authority. 33074Cleveland Metropolitan Housing Authority. 33075Cleveland Metropolitan Housing Authority. 33112Lorain Metropolitan Housing Authority. 33261Lorain Metropolitan Housing Authority. 33262Lorain Metropolitan Housing Authority. 33041Warren Metropolitan Housing Authority. 33043Warren Metropolitan Housing Authority. Oregon35021Housing Authority of Portland. Pennsylvania36051Housing Authority of County of Beaver. 36058Housing Authority of County of Beaver. 36041Housing Authority of Bethlehem. 36042Housing Authority of Bethlehem. 36044Housing Authority of Bethlehem. 36151Allegheny County Housing Authority. 36152Allegheny County Housing Authority. 36061Housing Authority of County of Lawrence. 36021Housing Authority of City of Erie. 36031Housing Authority of County of Lycoming. 36011Housing Authority of Philadelphia. 36012Housing Authority of Philadelphia. 36014Housing Authority of Philadelphia. 36015Housing Authority of Philadelphia. 36016Housing Authority of Philadelphia. 36101Housing Authority of City of Pittsburgh. 36212Allegheny County Housing Authority. 36295Housing Authority of City of York. Rhode Island37013Housing Authority of City of Newport. South Carolina38023Housing Authority of City of Charleston. 38061Housing Authority of City of Charleston. 38041Housing Authority of City of Spartanburg. 38042Housing Authority of City of Spartanburg. Tennessee40022Jackson Housing Authority. 40023Milan Housing Authority. 40011Nashville Housing Authority. 40025Trenton Housing Authority. Texas41064Housing Authority of City of Corpus Christi. 41065Housing Authority of City of Corpus Christi. 41133Housing Authority of City of Freeport. 41031Housing Authority of City of Houston. 41131Housing Authority of City of Lake Jackson. 41101Housing Authority of City of Mineral Wells. 41103Housing Authority of City of Mineral Wells. 41072Housing Authority of City of Orange. 41032Housing Authority of City of Pasadena. 41141Housing Authority of City of Texarkana. 41121Housing Authority of City of Wichita Falls. Virginia44131Alexandria Redevelopment and Housing Authority. 44132Alexandria Redevelopment and Housing Authority. 44133Alexandria Redevelopment and Housing Authority. 44135Alexandria Redevelopment and Housing Authority. 44136Alexandria Redevelopment and Housing Authority. 44065Newport News Redevelopment and Housing Authority. 44074Norfolk Redevelopment and Housing Authority. 44086Portsmouth Redevelopment and Housing Authority. Washington45043Housing Authority of City of Bremerton. 45277NHousing Authority of County of Clallam. 45315NHousing Authority of County of Clallam. 45133Housing Authority of County of King. 45052Housing Authority of City of Seattle. 45053Housing Authority of City of Seattle. 45054Housing Authority of City of Seattle. 45055Housing Authority of City of Seattle. 45056Housing Authority of City of Seattle. 45122Housing Authority of City of Vancouver.
(b)Upon the conveyance by the Secretary of Housing and Urban Development of any such project pursuant to the provisions of this section, such project shall constitute and be deemed to be “low-rent housing” as that term is used and defined in the United States Housing Act of 1937 [42 U.S.C. 1437 et seq.] (and to be a low-rent housing project assisted pursuant to that Act, within the meaning of section 1404a(b) of this title). Any instrument of conveyance by the Administrator stating that it is executed under subchapters II to VII of this chapter shall be conclusive evidence of compliance therewith insofar as any title or other interest in the property is concerned.
(c)The agreement between the public housing agency and the Secretary of Housing and Urban Development required by subsection (a) of this section shall contain the following conditions and requirements, and may contain such further conditions, requirements, and provisions as the Secretary determines—
(1)during a period of forty years following the conveyance the project shall be administered as low-rent housing in accordance with subsection 2(1) and 2(2) of the United States Housing Act of 1937 [42 U.S.C. 1402(1) and (2)]: Provided, That if at any time during such period the public housing agency and the Secretary of Housing and Urban Development agree that the project, or any part thereof, is no longer suitable for use as low-rent housing, the project, or part thereof, shall with the approval of the Secretary of Housing and Urban Development be sold by the public housing agency after which the agreement shall be deemed to have terminated with respect to such project or part thereof except that the proceeds from such sale, after payment of the reasonable expense thereof, shall be paid to the Secretary of Housing and Urban Development, or, with the Secretary’s approval, used to finance the repair or rehabilitation of a project or part thereof conveyed to the public housing agency under this section;
(2)the public housing agency shall, within six months following the conveyance, initiate a program for the removal of all families residing in the project on the date of conveyance who are ineligible under the provisions of the United States Housing Act of 1937 [42 U.S.C. 1437 et seq.] for continued occupancy therein, and shall have required such ineligible tenants to vacate their dwellings within eighteen months after the initiation of such program: Provided, That military personnel as designated by the Secretary of Defense or his designee shall not be subject to such removal until eighteen months after the date of conveyance;
(3)annually during the term of such agreement, the public housing agency shall pay to the Secretary of Housing and Urban Development all income from the project remaining after deducting the amounts necessary (as determined pursuant to regulations of the Secretary of Housing and Urban Development) for (i) the payment of reasonable and proper costs of operating, maintaining, and approving such project, (ii) the payments in lieu of taxes authorized hereunder, (iii) the establishment and maintenance of reasonable and proper reserves as approved by the Secretary of Housing and Urban Development, and (iv) the payment of currently maturing installments of principal of and interest on any indebtedness incurred by such public housing agency with the approval of the Secretary of Housing and Urban Development: Provided, That the provisions of this paragraph shall not be applicable to any project which is consolidated under a single contract with one or more low-rent projects being assisted under the United States Housing Act of 1937 [42 U.S.C. 1437 et seq.], and all income from any such project conveyed under this section may be commingled with funds of the project or projects with which it is consolidated and applied in accordance with the requirements of the consolidated contract and the provisions of section 10(c) of the said Act [42 U.S.C. 1410(c)];
(4)during the term of such agreement, the project shall be exempt from all real and personal property taxes levied or imposed by the State, city, county, or other political subdivisions;
(5)for the tax year in which the conveyance is made and the next succeeding tax year annual payments in lieu of taxes may be made to the State, city, county, or other political subdivisions in amounts not in excess of the real property taxes which would be paid to such State, city, county, or other political subdivisions if the project were not exempt from taxation; and thereafter, during the term of such agreement, payments in lieu of taxes with respect to the project may be made in annual amounts which do not exceed 10 per centum of the annual shelter rents charged in such project;
(6)in selecting tenants for such project, the public housing agency shall give such preferences as are prescribed by subsection 10(g) of the United States Housing Act of 1937 [42 U.S.C. 1410g], except that for one year after the date of conveyance of a project, the public housing agency shall, to the extent permitted by law, give such preferences, by allocation or otherwise, to military personnel as the Secretary of Defense or his designee prescribes to the public housing agency; and
(7)upon the occurrence of a substantial default in respect to the requirements and conditions to which the public housing agency is subject (as such substantial default shall be defined in such agreement), the public housing agency shall be obligated at the option of the Secretary of Housing and Urban Development, either to convey title in any case where, in the determination of the Secretary of Housing and Urban Development, (which determination shall be final and conclusive), such conveyance of title is necessary to achieve the purposes of this subchapter and the United States Housing Act of 1937 [42 U.S.C. 1437 et seq.], or to deliver possession to the Secretary of Housing and Urban Development of the project, as then constituted, to which such agreement relates: Provided, That in the event of such conveyance of title or delivery of possession, the Secretary of Housing and Urban Development may improve and administer such project as low-rent housing, and otherwise deal with such housing or parts thereof, subject, however, to the limitations contained in the applicable provisions of the United States Housing Act of 1937. The Secretary of Housing and Urban Development shall be obligated to reconvey or to redeliver possession of the project, as constituted at the time of reconveyance or redelivery, to such public housing agency or to its successor (if such public housing agency or a successor exists) upon such terms as shall be prescribed in such agreement and as soon as practicable after the Secretary of Housing and Urban Development shall be satisfied that all defaults with respect to the project have been cured, and that the project will, in order to fulfill the purposes of this subchapter and the United States Housing Act of 1937, thereafter be operated in accordance with the terms of such agreement. Any prior conveyances and reconveyances, deliveries and redeliveries of possession shall not exhaust the right to require a conveyance or delivery of possession of the project to the Secretary of Housing and Urban Development pursuant to this paragraph upon the subsequent occurrence of a substantial default.
(d)At the end of each fiscal year, the total amount of payments during such year to the Secretary of Housing and Urban Development in accordance with subsection (c) of this section shall be covered into the Treasury as miscellaneous receipts.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
References in Text
The United States Housing Act of 1937, referred to in subsecs. (a)(1), (b), and (c)(2), (3), (7), is act Sept. 1, 1937, ch. 896, as revised generally by Pub. L. 93–383, title II, § 201(a), Aug. 22, 1974, 88 Stat. 653, which is classified generally to chapter 8 (§ 1437 et seq.) of this title. For complete classification of this Act to the Code, see
Short Title
note under section 1437 of this title and Tables. Subchapters III and VI of this chapter, referred to in subsec. (b), were comprised of sections 1531 to 1536 and 1571 to 1576, respectively, of this title and have been omitted from the Code. For further details, see note set out under section 1522 of this title. Subsection 2(1) and 2(2) and section 10 of the United States Housing Act of 1937, referred to in subsec. (c)(1), (3), (6), are references to section 2 and 10 of the Act prior to the general revision of the Act by Pub. L. 93–383. The Act as so revised is classified to section 1437 et seq. of this title. Provisions of former section 2 and 10 are covered by section 3 and 5 of the Act which are classified to section 1437a and 1437d of this title.
Amendments
1974—Subsec. (b). Pub. L. 93–383, § 207(a), struck out provisions relating to payment of capital grants or annual contributions to low-rent housing projects. Subsec. (c)(1). Pub. L. 93–383, § 207(b), inserted provision relating to financing repair or rehabilitation of a project or part of project conveyed to public housing agency under this section. 1959—Subsec. (b). Pub. L. 86–372, § 807(1), provided that if any such project is consolidated under a single annual contributions contract with any low-rent project being assisted with annual contributions under United States Housing Act of 1937, payment of any annual contribution on account of any project so assisted shall not be deemed to be a capital grant or annual contribution with respect to any project conveyed hereunder. Subsec. (c)(3). Pub. L. 86–372, § 807(2), inserted proviso making provisions of subsec. (c)(3) inapplicable to any project which is consolidated under a single contract with one or more low-rent projects being assisted under United States Housing Act of 1937, and permitting commingling of income from such project with funds of project or projects with which it is consolidated.
Statutory Notes and Related Subsidiaries
Transfer of Functions
For
Transfer of Functions
to Secretary of Housing and Urban Development, see note set out under section 1581 of this title.
Executive Documents
Executive Order No. 10284 Ex. Ord. No. 10284, Sept. 4, 1951, extended time for request for conveyance of housing projects from Dec. 31, 1950, to Dec. 31, 1951, and extended time for entering agreements with Public Housing Administration from
June 30, 1951, to
June 30, 1952. See note set out under section 1589a of this title. Executive Order No. 10339 Ex. Ord. No. 10339, Apr. 7, 1952, set out as a note under section 1589a of this title, extended time for request for conveyance of housing projects from Dec. 31, 1951, to Dec. 31, 1952, and extended time for entering agreements with Public Housing Administration from
June 30, 1952, to
June 30, 1953. Executive Order No. 10425 Ex. Ord. No. 10425, Jan. 16, 1953, set out as a note under section 1589a of this title, extended time for request for conveyance of housing projects from Dec. 31, 1952, to
June 30, 1953.
Reference
Citations & Metadata
Citation
42 U.S.C. § 1586
Title 42 — The Public Health and Welfare
Last Updated
Apr 5, 2026
Release point: 119-73not60