WASHINGTON - Henry Cisneros, President-elect Bill Clinton's nominee to head the Department of Housing and Urban Development, favors giving state and local governments increased federal aid and a greater say in how to spend those dollars on housing programs, industry officials said yesterday.

Clinton told reporters yesterday the former mayor of San Antonio "will bring fresh energy to an agency that badly needs reform and revitalization." With Cisneros at HUD, "America's cities will have the voice and the vision they need and deserve," Clinton added.

Before serving as mayor from 1981 to 1989, Cisneros, 43, spent six years on the San Antonio City Council. He was president of the National League of Cities in 1986.

"I'm delighted someone with local government experience has been chosen to head the agency that has the most dealings with, and perhaps influence over, local governments in the areas of housing and community development," said John C. Murphy, the executive director of the Association of Local Housing Finance Agencies.

Murphy and other housing industry officials said Cisneros is known to be an enthusiastic supporter of Clinton's housing proposals, which include increasing funding for the HOME program and making permanent the tax exemption for mortgage revenue bonds.

As a former local official, Cisneros is likely to be especially supportive of Clinton's stated desire to develop a housing partnership between the federal government and state and local governments. Clinton, for example, has said he wants to give states and localities more flexibility in spending federal aid under the HOME program, which requires the federal government to match contributions states and localities make to low-income rental and home-ownership projects.

"Particularly in the HOME program, [Cisneros] understands the need to have local governments develop programs responsive to their needs," said Reggie Todd, chief executive officer of the National Community Development Association.

"It's clear to me Henry Cisneros is very excited about HUD and believes it can have a very significant role." said Frank Shafroth, the director of policy and federal relations for the National League of Cities. "I think what he wants to do at HUD is transform it and make it a viable agency" with an increase in emphasis on urban development policies.

Cisneros' appointment would mean a breath of fresh air at HUD after 12 years of inactivity under Presidents Reagan and Bush and their housing secretaries, Samuel Pierce and Jack Kemp, housing officials said.

"Hopefully, this ends the Kemp inertia at HUD and we can move away from fear of scandal to the production of housing," said Robin Salomon, a lobbyist with Brownstein, Zeidman and Lore. He said Cisneros' reputation "is more on the urban development side and we look forward to his views on housing."

John T. McEvoy, the executive director of the National Council of State Housing Agencies, said, "For 12 years we've had HUD dedicated to ignoring problems, except Kemp in his first year or two." Next year "this whole place is going to have an energy and a commitment to its original mission that it's been missing for more than a decade."

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