WASHINGTON -- Federal officials say that President Clinton probably will ask Congress to replace the federal agency that provides mortgage insurance to millions of home buyers with a new government-controlled corporation that operates more like a private business.
The agency, the Federal Housing Administration, was created 60 years ago to help combat the effects of the Depression. It has provided mortgage insurance for more than 51 million home buyers, enabling many of them to get mortgages they could not otherwise obtain.
The proposal to convert the agency to a government-controlled corporation is one of many being readied for Mr. Clinton as alternatives to Republican plans to reduce the size and scope of government.
Democratic strategists hope to demonstrate to the voters who gave Republicans control of Congress last month that Democrats are not reflexively in favor of big government, bloated bureaucracies and high federal spending.
Confidential budget documents show that the White House wants to eliminate 13 housing programs and consolidate many others.
Mr. Clinton is to sketch his vision in a televised speech to the nation tomorrow night. The White House said the president would deliver his remarks from a room in his official residence, to achieve a more informal feeling, rather than from the Oval Office, where presidential addresses are most often staged.
The budget documents show that the White House wants to provide more flexibility to state and local housing agencies, while cutting the amount of federal aid. The programs to be ended include construction of housing for the elderly, construction of special housing for disabled people and emergency shelter grants.
The agency's policies set standards followed throughout the home-building and mortgage industries. Nearly half of all HUD employees work on its programs. As a government-controlled corporation within the department, federal officials say, the housing administration could operate with the efficiencies of a .. private business.
The documents say that the housing department must make radical changes to "salvage its credibility," to rein in the growth of spending and to address criticism from Republicans like Rep. Newt Gingrich, R-Ga., in line to become speaker of the House, who says federal housing policies have been a failure.
But Deborah M. Austin, a lobbyist for the National Low-Income Housing Coalition, a private group committed to housing for the poor, said yesterday: "The administration is trying to outmaneuver the Republicans by developing proposals that we would have expected to come from conservatives in the new Congress. It's a pre-emptive strike."
The budget documents show the administration would make these changes:
* Withhold community development block grants and housing aid from cities and states "with a track record of blatant discrimination" against blacks and Hispanic people; Link the allocation of money to the enforcement of fair housing laws.
* Lower the maximum rent for people receiving federal housing assistance.
(Local housing officials oppose this change, saying it would increase the concentration of these tenants in the poorest neighborhoods, when it is preferable to scatter them through many neighborhoods.)
* Consolidate five separate programs for homeless people in a single block grant and encourage homeless people to seek assistance through other housing programs.
* Direct housing assistance to people with incomes below 40 percent of the median income in a local area. "Reward work" by reserving half of new assistance for working families with children. Allow them to keep a larger share of their income if they increase their earnings from year to year.
* Establish a new "public housing capital fund." Local authorities could use the money to demolish, repair or replace public housing.