Now, we also made inquiry of the situation in Illinois and in Pennsylvania, which have huge cities. Senator Douglas and Senator Clark will speak for themselves, but there too we found enormous demand very much paralleling what we find in New York.

The original proposal providing $1.3 billion in additional capital grant authority for the next 6 fiscal years will, I believe, prove inadequate. Under the existing limitation of no more than 12.5 percent for any one State, New York has already used up its maximum and is, in fact, currently dipping to the extent of $16 million into the so-called "extender" fund. But according to the survey we have made, New York City could singlehandedly utilize more than the total amount to be allotted to the entire State of New York over the next 6 fiscal years under present plans. I emphasize that "under present plans."

Also, it is our belief that cutting the formula to a 50/50 basis from the present two-thirds/one-third would not work and would be very harmful to the cities in our State.

The 16 cities from which we have gotten authoritative figures would either have to eliminate $64 million worth of renewal projects or divert an equivalent amount of local funds from such things as schools and similar municipal facilities to meet their increased urban renewal shares.

Also, the more than $70 million in applications from these cities now pending before the Urban Renewal Administration is particularly alarming in view of the fact that as of May 16, 1958, the Urban Renewal Administration had less than $38 million in available funds to meet more than $260 million in requests pending from cities across the Nation.

We point out that the consequences of this are that project requests from several cities in New York, including the hard-hit recession area of Buffalo, cannot be processed in the immediate future.

We think at least I think and I am quite sure that that view is shared by my associates on this bill-that this sharing of costs should stay as it is.

Now, Mr. Chairman, I have the telegrams available. I did not wish to encumber the record with them. But they are available to the committee's staff if they feel that they can get some use out of them. We will be very glad to let them see them.

Now, the other recommendations which I have are personal and do not represent the group which put in the bill. They may very well agree, though I am not in position to state that authoritatively.

The other recommendations relate to certain changes in the urban renewal law which are compelled upon us, I believe, by experience. First, I think that the costs of relocation should be borne by the Government to a more substantial extent than they are being borne now and that, realistically, the maximum relocation allowances in the case of an urban renewal project should be raised to $500 per family from the present $100 and to $5,000 per commercial occupant from the present $2,500.

Our experience in New York, where we are having very considerable trouble with relocation from urban renewal projects, shows that the increase of the amounts allowable as maximum could be very, very helpful, and we strongly urge that that be done.

We, of course, have already directed the attention of the housing authorities to New York's rather unique and often-criticized system of tenant relocation in which the private developer moves according to an approved plan to relocate the people on the site.

Now, it is not possible to condemn that as a matter of law, as it were. I am speaking now as a lawyer. Because sometimes it works and sometimes it does not. It depends upon management. And, hence, the management-that is, the city's management, the supervisory management is supremely important.

There are two projects in New York, and one of them in my own old congressional district called Manhattanville, Morningside Gardens. There it worked very well, and everybody who wanted to be relocated got relocated quite efficiently. There the matter was well supervised. I must say I was on the job myself. And also we had nine institutions like Čolumbia University and Juilliard School of Music and various others at a place we call Morningside Heights, a kind of little area in the middle west side, which did the things themselves, and they did it with great attention to social need.

On the other hand, we had a project called Manhattan Town, which was a dismal failure, only a mile and a half south of the one I am just describing which was a great success. There we had all kinds of difficulties with relocation and, indeed, scandalous conditions which were revealed before this committee.

I point that out only as a matter of fact and information for the committee and to emphasize the need for top-level management.

Now, the other thing to which I wish to refer in respect to urban renewal is the need for recognizing the public housing on urban renewal sites or in connection with the relocation of urban renewal tenants is extremely important.

Again I revert to the two projects I have described: The Manhattanville project, a huge success because of the location of a big public housing project called General Grant Housing. The Manhattan Town, a terribly dragged out, very difficult and pain-creating enterprise for the tenants and everybody else concerned, which did not have public housing located on the site.

I urge this committee-and I shall myself adduce a suggestion; I notice the committee is already seeking to find a way-to give some allowance in the one-third contribution of municipalities for public housing. I am not going to try to tell the committee what I think ought to be done specifically. I will suggest that in writing, which I am working on now. But I notice the committee is dealing with it, and I applaud that, the attention to that problem, and I hope very much that it can be considered.

We think in my office that it certainly ranks with playgrounds or schools or anything else of that tangible nature in the way of community facilities for which allowance is made and, indeed, has even more impact upon the success of the urban renewal project itself. So much, Mr. Chairman, for urban renewal.

Now, on the general FHA bill, I have two suggestions. I shall take but 30 seconds to mention them because I have discussed them in great detail before.

One is extension of the maximum mortgage period to 40 years. That is coming in for a lot of attention. The committee will have a lot of testimony on it I am sure. I would strongly urge it.

25834-58-40

The other, in which at the moment I have not too much company, is reducing the FHA premium from one-half of one percent to onequarter of one percent. I feel that actuarily that reduction is justified. I might say to the chairman that I am hoping to commission a study by competent housing economists to prove it is justified.

But I have already adduced some of these figures on the floor in interchange with the chairman of the committee when the emergency housing bill was up. And I strongly commend it to the committee.

This is one of those ways in which Government can show its adaptability to changing conditions and not just let something roll on and on and on just because we did it that way to begin with.

Thank you, Mr. Chairman.

Senator SPARKMAN. Thank you, Senator Javits.
Senator Payne?

Senator PAYNE. No questions.

Senator SPARKMAN. Senator Javits, with reference to your survey of New York, it is very interesting and very helpful. You know, under the committee print, which is just a suggestion, we propose a total of $32 billion over the next 10 years, or an average of $350 million a year, with permission to spend as much as $500 million in any one year.

Taking your figures, I notice that they would come for that period of time to a total of $437 million.

Senator JAVITS. That is right.

Senator SPARKMAN. For New York State, under the formula of a maximum of 12.5 percent to any one State.

I wonder if your needs would not be filled under that kind of an arrangement.

Senator JAVITS. I like the formula in the committee print. I say I like it, because our group has put in this bill for $500 million right away. But that seems to me certainly to be meeting the need very much more closely than the administration's proposal.

Now, Mr. Chairman, I would like to point out in fairness to this administration that when it came into office a lot of people were very alarmed about the fact that it would be against urban renewal, against public housing, against a lot of things. It is showing it is not so. Now, its approach to it may be more modest than people like myself and those who are joined in this bill believe to be necessary, but, nevertheless, I think it is important and fair to note that they are moving in this area which we think is very vital for the Government to move into.

Now, I would like to emphasize that in urban renewal there is no more constructive activity that I know of socially than this one, nor do I believe there is any more constructive activity in the wealth production. And I hope the committee will see through any claims that this is inflationary, because inflation depends upon a situation where you spend money, for arms or some other expense, where you get nothing back which is tangible in terms of wealth production. Of course, you get back security and so on, and I am all for that. I am not arguing the merits.

But I am pointing out on the inflationary side that here you are putting in your money to an affirmative asset in the country, and, though you may owe money, you have an asset which far more than counterbalances what vou owe.

One of the defects of a great deal of the thinking which we see around here economically-and engaged in by some of our colleagues too-is that they think in absolute money terms without thinking in terms of what we have got as against what we owe.

Sure, the debt of the United States is $280 billion. But what have we got against that debt as contrasted with what we had some time ago?

And the best gauge for that that I know is gross national product. On that basis, the national debt with relation to our gross national product has been shrinking very markedly over the years. Whereas it has been going up in dollars, it has been shrinking very markedly in what any businessman knows to be the realistic equation—that is, what have you got and what are you taking in as against what you owe. Senator SPARKMAN. I think you will be interested to know that no witness appearing before our committee has opposed urban renewal. I think I am correct in saying that. I think it has received unanimous approval.

By the way, Mr. William McChesney Martin, the chairman of the Federal Reserve Board, spoke out in behalf of it. Of course, you know inflation is something that he is always watching.

Senator JAVITS. That is right.

Senator SPARKMAN. He said he thought urban renewal was the right kind of a program.

Senator JAVITs. Well, I am delighted, Mr. Chairman, and I think it just indicates that the world marches on.

Senator SPARKMAN. Thank you very much, Senator Javits.
Senator JAVITS. Thank you.

Senator SPARKMAN. Mr. Roland Boyd, general counsel of the Wherry Housing Association. Come around, Mr. Boyd. We have your statement, Mr. Boyd. Will you proceed in your own way?

For the benefit of the record, would you identify your associates? STATEMENT OF ROLAND BOYD, GENERAL COUNSEL, ACCOMPANIED BY HUB HILL, PRESIDENT, HAMILTON SHIELDS, VICE PRESIDENT, AND CHARLES A. KNOTT, SECRETARY-TREASURER, WHERRY HOUSING ASSOCIATION

Mr. BOYD. Thank you, Senator Sparkman and Senator Payne.

I am accompanied by Mr. Hub Hill of Dallas, president of the Wherry Housing Association, by Mr. Hamilton Shields of Portland, Maine, vice president of Wherry Housing Association, and by Mr. Charles Knott, of Baltimore, Md., secretary-treasurer of the Wherry Housing Association.

My name is Roland Boyd. I live in McKinney, Tex. I am actively engaged in the private practice of civil law.

Since October 15, 1957, I have been general counsel of the Wherry Housing Association.

The Wherry Housing Association is a voluntary, nonprofit organization composed of the majority of the owners of the 82,000 Wherry housing units in the United States and its possessions.

The board of directors of this association have passed a resolution that we request permission to appear before any committee that is considering matters affecting Wherry housing.

I as counsel for the association want to assist this committee in getting any pertinent facts affecting Wherry housing.

When I have finished this brief statement, I will welcome any questions from the committee and will be happy to supply additional information if I do not have it at my fingertips.

I would like to discuss five points:

One, the fact that Congress has determined it is in the best Government interests that Wherry housing be acquired.

Second, the present status of the acquisition program.

Third, the history of acquisition.

Fourth, the sound reasons in our judgment for acquisition. And, fifth, the fact that evidently most Wherry is going to be acquired and the reasons why we think it should all be acquired. And, lastly, our recommendation for a modification in the present law.

The first point is that Congress has determined that it is in the best Government interest that Wherry housing be acquired.

I would like to call the committee's attention to some typical statements contained in official reports field by congressional committees. The Banking and Currency Committee of the House, in 1957, said: Your committee believes strongly that Wherry housing on or adjacent to military bases should be owned and operated by the military department concerned.

The Armed Services Committee of the House, in 1957, said:

As the Armed Services Committee pointed out last year the savings to be effected are so large that it would be an unreasonable man indeed who would deny the wisdom of embarking upon this program of purchase.

The Senate Armed Services Committee, in 1957, said:

Recognizing that Wherry units would be in existence at military installations for perhaps the next 60 to 70 years and that in many instances it would be desirable for the military department to purchase them, Congress enacted permissive acquisition legislation in 1955.

The Senate Committee on Appropriations, in 1957 said:

It appears that the continued operation of these projects under the present conditions is excessively expensive to the Government, and that the best interest of the Government will be served if the military will proceed with dispatch and acquire these projects.

The House Committee on Appropriations in 1957 said:

These owners have businesses to operate and are certainly entitled to know what the plans of the Government are with respect to the acquisition of these projects.

From the above it is amply clear that Congress wants these projects acquired.

Next, the status of the acquisition program :

Of the 37,100 units built on Air Force bases, as of March 25, 1958, 21,200 units had either been acquired by negotiation by the Air Force or had been placed in condemnation. The Air Force proposed to acquire by negotiation or condemnation through June 30, 1958, an additional 5,500 units.

Of the original 22,200 units built on Army bases, as of March 25, 1958, 9,400 units had been acquired, either by negotiation or had been placed in condemnation. The Army proposed, by the end of this fiscal year, to either acquire or condemn 3,300 additional units.