Mr. RICHARDS. No.

Mr. THOMAS. Certainly it does.

Provided, That hereafter the national defense housing insurance fund shall be available in addition to the purposes for which it is otherwise available under law, for administrative expenses of the Federal Housing Administration.

You can use those funds plus this $51,000 plus this $2,500,000. Mr. FITZPATRICK. Mr. Chairman, we could not use that beyond the limitation of $25,800,000 which you would set by this law. The real reason for that language is that there was added to the bill on the floor of the Senate an amendment which said:

Provided, That no moneys in said fund—

that is the defense housing insurance fund

shall be expended for administrative expenses of the Federal Housing Administration under this title except pursuant to such specific authorization therefor as may be hereafter enacted by the Congress.

Now this would be the subsequent enactment which would make the fund available for administrative expenses within whatever limitation you set-both on the administrative and nonadministrative.

It is perfectly true that if you did not set the $25,800,000 limit, then we would be free to spend beyond that amount, but we could not spend beyond any limit that you establish by this law.

Mr. THOMAS. Of course, there is no appropriation for your nonadministrative expense.

Mr. RICHARDS. We are asking for $2,500,000. We estimate our income for the year to be $6,854,000, and we are asking permission to spend $2,500,000 of that income.

Mr. THOMAS. That is what I say. That is money you collect from the fees and is not appropriated. The only appropriated money in here you are seeking is $51,000.

Mr. RICHARDS. We are not asking for any appropriated money. The $51,000 also comes out of the insurance fees and premiums. Mr. THOMAS. Does that come out of the insurance premium, too? Mr. RICHARDS. That is right.

Mr. THOMAS. It is not an appropriated fund?

Mr. RICHARDS. That is right. So that what we are doing here is asking for the right to spend out of that insurance fund that was set up in order to operate title IX. We estimate our income in that year that we are spending this $2,551,000 as $6,854,000.

This language was required because of the Case amendment which said we could not spend from the new fund without specific authorization from the Congress. That is why we cannot operate title IX until the Congress authorizes us to use money out of that fund.

DEFENSE HOUSING

Mr. THOMAS. Clearing up another point here, under the Office of the Administrator appropriation it states:

For the provision of defense housing in accordance with title III of the Defense Housing and Community Facilities and Services Act of 1951, including administrative expenses of the Public Housing Administration in connection therewith, $50,000,000, to remain available until expended * * *.

That money is appropriated to the Administrator's office, yet Mr. Egan has been delegated to spend the money. Is that correct? Mr. FITZPATRICK. Yes, sir.

MERGER OF OPERATING FUNDS

Mr. THOMAS (reading):

Provided, That any moneys or reserves authorized by sections 303 and 605 (c) of the Act of October 14, 1940, as amended (42 U. S. Č. 1543 and 1585).

What does that mean?

Mr. FRANTZ. Mr. Thomas, section 303 of the Lanham Act authorizes the receipts from rentals and disposition proceeds under the Lanham Act to be used for expenses of maintenance and operation and for the establishment of reserves for the removal of that housing. Public Law 139 contains a similar provision.

The purpose of this language is to permit the merging of those operating funds and reserves so as to achieve economy by not having to keep elaborate detailed separate accounts on what is essentially the same operation.

Com

Mr. THOMAS. For bookkeeping purposes is one thing now. mingling the funds and using the funds for one project or another is a different thing. This language gives you authority to do that. Why could not each one stand on its own bottom? For accounting purposes it seems well and good, but under this language you can take the rentals from these new projects and spend them for maintenance and repair on the old projects. Is that correct?

Mr. FRANTZ. That would be correct; yes, sir.

Mr. THOMAS. Is that a good thing or bad thing?

Mr. FRANTZ. I think the answer to that, Mr. Thomas, is that you could not spend any more with respect to the total than you could spend separately from the two, if they were held individually.

Mr. THOMAS. Yet there is quite a difference there. You take funds from a new project where the maintenance certainly ought to be very low. You take those funds and spend them on an old project where the maintenance is very high and where you have been renting them awfully low, and perhaps you do not have enough money to do your maintenance. Do you not think they ought to be made to stand on their own bottom for every purpose except accounting?

Mr. FRANTZ. They are not segregated now by projects.

Mr. PHILLIPS. How would you show them if you were reporting them to this committee? You would show them as a pooled fund, and that is what the chairman is bringing out.

Mr. FITZPATRICK. We would show them as a pooled fund, and we would then show what was spent for those purposes on the total program. It would not be broken down separately.

I think it comes down essentially to the question of whether the desirability of keeping those records separate outweighs the economies which otherwise could be achieved by a single set of books.

PUBLIC HOUSING ADMINISTRATIVE EXPENSE

Mr. THOMAS. Carrying it one step further:

Provided further, That the amount made available under this head in title IV of the Independent Offices Appropriation Act, 1952, for administrative expenses of the Public Housing Administration is increased from $12,780,000 to $13,280,000.

And that gives Mr. Egan administrative expenses of $500,000 for about 9 months. Is that correct, Mr. Egan?

89877-51-7

Mr. EGAN. That is correct.

Mr. THOMAS. What will that administrative expense be on an annual basis?

Mr. EGAN. It is contemplated, Mr. Thomas, that we would have all the units that we would be able to construct under the $50,000,000 appropriation under contract by the end of this fiscal year, by June

30.

Mr. THOMAS. You are going to build less than 8,000 units, and what portion of Mr. Foley's $1,340,000 is going to be added to your $500,000 administrative expense?

Mr. FITZPATRICK. No portion of our funds would be added to theirs. Mr. THOMAS. It will not be added, but it is certainly doing the same and similar type of work, is it not?

Mr. FITZPATRICK. No, sir; the estimate of $500,000 for transfer to PHA is for those administrative expenses concerned with the actual provision of any housing that is built

Mr. THOMAS. How many employees does that give you?

Mr. EGAN. The detail is on page 30-186.

Mr. THOMAS. 186 employees.

PROVISION OF DEFENSE HOUSING THROUGH PUBLIC CONSTRUCTION

Mr. THOMAS. At this point insert in the record page 30. (The page referred to is as follows:)

Mr. THOMAS. How many units is that going to cover? Mr. EGAN. Seven thousand eight hundred and seventy-five is the estimated amount.

Mr. THOMAS. One hundred and eighty-six positions broken down as to administrative and legal 26, development 17, and management

and disposition 7. That is 50 in the District of Columbia. In the field it is 136.

NUMBER OF UNITS FOR PUBLIC CONSTRUCTION

You have lands and structures, $48,500,000; salaries, $420,000; communications, $12,000; supplies and materials, $5,000; equipment, $8,000. How did you arrive at this figure of 7,875, Mr. Egan?

Mr. EGAN. The number of units we contemplate to construct, Mr. Thomas?

Mr. THOMAS. Yes, sir.

Mr. EGAN. That was the figure I think we got from the Administrator's office.

Mr. THOMAS. How did the Administrator arrive at that figure? Mr. FITZPATRICK. That is arrived at approximately this way Mr. THOMAS. Give us a guess figure. Title IX, 175,000 units; other private, 42,000 units; total, 117,225; and other public units 7,875, a grand total of 225,000 units programed under which you are basing your administrative costs and your other costs totaling some $60,000,000 or $65,000,000. How did you arrive at those figures?

Mr. FITZPATRICK. Out of $50,000,000 you cannot get a very large amount of housing. Now, under the Defense Housing Act permanent housing may be provided through public construction only to the extent that the private builders do not take up the quota that is actually announced.

It seemed perfectly obvious that you are not going to have many cases where that is not taken up.

Mr. THOMAS. Where are you going to put these units?

Mr. FITZPATRICK. I think we felt one of the prime factors we would have to consider in connection with the use of Title III housing is cases of the type which have been referred to in the report of the Lyndon Johnson preparedness subcommittee.

UNITS TO BE CONSTRUCTED UNDER TITLE IX

Mr. THOMAS. Can you give us a breakdown of these 175,000 units under title IX of the act and the 42,000 which you list as other private units and then the public units of 7,875? Where you are going to locate them?

Mr. FITZPATRICK. Mr. Chairman, we could not give that until the areas are actually designated.

Mr. THOMAS. If the areas have not been designated, how in the world do you arrive at your total figure of 225,000?

Mr. FITZPATRICK. Our indications were that in the course of the year there would be a total of 400 areas declared critical.

Mr. THOMAS. You still do not know that?

Mr. FITZPATRICK. No.

Mr. THOMAS. In other words, the number of areas where they are going to be located is still to be decided and the number of private units to be built under title IX is still a guess and public units is still a guess. These figures are your best judgment on the question?

Mr. FITZPATRICK. They are an informed judgment, Mr. Chairman, as to what we expect. I think it is reasonable to assume that with the additional aids provided by the Congress in the new act, the

number of areas that will be declared critical areas will be much larger than the number declared by the Kaul committee in a period where we did not have the――

Mr. THOMAS. The authorization was $40,000,000, of which you got $15,000,000 and the Public Health Service got $25,000,000.

Mr. SEWARD. The authorization was $60,000,000, Mr. Thomas. Mr. THOMAS. That is right, and your request was $40,000,000. "The activities of the Public Health Service dealing directly with health" is the language of the authorization. I am rather confused as to what specifically is health, but anyway the Bureau of the Budget tried to come up with some guess on it, and perhaps they did about as good as anybody else could do. Is that right?

Mr. FITZPATRICK. Mr. Chairman, speaking with reference to your special interest in having facilities and housing treated as one-you will recall that the legislation when originally introduced did adopt that approach.

Mr. THOMAS. That is right, it was taken out in conference.

Mr. FITZPATRICK. The Congress decided that the four functions specifically mentioned in section 316 should be handled by the Public Health Service.

UNIT COSTS FOR PUBLICLY CONSTRUCTED DEFENSE HOUSING

Mr. THOMAS. I notice your cost here on these public defense housing units, $10,000 a unit, and your trailers cost $2,900 and temporaries cost $5,980 a unit. You have 16 permanent public housing. Is this 16 trailer camps?

Mr. FITZPATRICK. That is 16 projects, 16 areas where trailers will be located.

Mr. THOMAS. How many units are you going to have in these 16 projects? The unit cost is $10,000, and the sum total is $15,000,000. How many units will that be?

Mr. FITZPATRICK. 1,500 trailers and 4,875 temporaries.

Mr. THOMAS. These will be rather large projects, will they not? Your temporaries cost $5,980, and you have 1,553 projects. How many units will be in each one of those projects?

Mr. KELLY. 4,875 units, which is a little over 90 units per project. Mr. THOMAS. In other words, they will be placed then, as far as permanents are concerned, in 16 different towns and cities?

Mr. KELLY. That is right.

Mr. THOMAS. As far as your trailers are concerned, they will be in 16 different towns and cities and as far as your temporary public housing is concerned, they will be in 53 different towns and cities? Mr. EGAN. That is right.

Mr. THOMAS. How many units will that average for your permanent public housing?

Mr. KELLY. A little over 90 per project.

Mr. FITZPATRICK. A little over 90 in permanent, a little over 90 in trailers, and approximately 90 in temporaries.