A bill to provide that Federal housing and community development programs will be administered by the Secretary of Agriculture in nonmetropolitan areas, and for other purposes.

Amends the Housing and Community Development Act of 1974 to delegate to the Secretary of Agriculture authority to administer Federal assistance for community development programs involving units of local government and Indian tribes outside metropolitan areas or within such an area if the Secretary of Housing and Urban Development determines that the location is rural in nature and best served by the Farmers Home Administration (nonmetropolitian areas).

Requires that 20 percent of the special discretionary fund set aside for housing and community development grants by the Secretary of HUD be used by the Secretary of Agriculture for making such grants for nonmetropolitan areas.

Authorizes the Secretary of Agriculture to make rural development action grants to nonmetropolitan counties (which include portions of counties outside metropolitan areas).

Delegates to the Secretary of Agriculture the authority to administer specified Federal assistance programs for lower income housing in nonmetropolitan areas.

Amends the Housing Act of 1959 to direct the Secretary of HUD to delegate to the Secretary of Agriculture the authority to make loans for the provision of rental or cooperative housing for elderly or handicapped families in nonmetropolitan areas.

Amends the National Housing Act to delegate to the Secretary of Agriculture the authority to insure loans for home improvements and mortgages in nonmetropolitan areas. Directs the Secretary of HUD to transfer to the Secretary of Agriculture for use in rural areas and small towns 25 percent of the total authority of the HUD Secretary to contract for: (1) mortgage assistance payments for low income homeowners; and (2) mortgage interest reduction payments on behalf of owners of rental housing projects for lower income families.

Authorizes appropriations.