this fund to FNMA. The first few weeks of this activity was very gratifying and portends a successful program. The bill was signed on April 1 and at the end of the first 5 weeks the FNMA had entered into commitment contracts totaling $143,940,000 for the purchase of 12,000 Government-backed mortgages. The emergency housing bill also added $50 million to the armed services FNMA program for purchase of title VIII mortgages, making a total new addition of $1,550 million for purchase of mortgages under the special assistance program. This program now has a total of $2,650 million authorization for purchase of FHA and VA mortgages.

FNMA activity under the Emergency Housing Act of 1958 (Public Law 83–364, signed Apr. 1, 1958), in number and dollar volume of commitment contracts

Status of FNMA special assistance fund (as of Apr. 24, 1958

1 The figures for this program are as of May 1, 1958.

This includes $20 million for cooperative (consumer-sponsored) mortgages, $25 million for sec. 809 mortgages and $700 million for low- and moderate-cost housing.

3. Management and liquidating functions

Under this function, FNMA is required to manage and liquidate its portfolio of mortgages acquired under contracts issued prior to November 1, 1954.

As of August 2, 1954, when the new FNMA charter was approved, the portfolio of mortgages amounted to $2,414 million and commitments amounted to $737 million, a total liability of $3,152 million. This was reduced to $2,304 million by the end of 1957, which is the approximate balance at this time.

Originally the financing for purchasing mortgages under this program came through borrowings from the Treasury. In 1957, FNMA sold notes to private investors and refinanced $1.6 billion or about 70 percent of the total obligations with private capital.

FNMA has not sold any mortgages under this program since 1955 and has not yet announced when mortgages will again be for sale but if the present trend in the mortgage market continues, time may soon be ripe to reopen the portfolio for sale to private capital.

COMMUNITY FACILITY LOANS

Loans under this program are made by the Federal Government to supplement the resources of communities in the planning and construction of community facilities.

1. Advances for public works planning

This is a loan program to help States, municipalities and other public agencies prepare plans for public works.

The advances made since enactment of the law in 1954 are as follows:

1955.

1956. 1957.

1st 4 months of 1958..

The status of the fund is as follows:

Total authorization_____

Authorization available___.

(An additional $14 million will be made available July 1, 1957.)

Actual appropriation to date---

Commitments or advances (as of April 30, 1958)

$240,000 3,975,000 6, 926, 000 5, 359, 000

$48, 000, 000 34, 000, 000

17, 000, 000 16,500,000

About one-half of the advances have been for sanitation and water facilities.

2. Public facility loans

Long-term loans are made under this program to States and local public agencies to finance specific public works which are urgently needed. Priorities are given to small municipalities (less than 10,000 population.)

Loans are permitted up to 40 years but in practice the agency tries to limit loans to 30 years. The interest rate is based on the rate currently applicable for municipal and long-term bonds. Over the last several years, the rate was between 4 and 5 percent. In late March, the interest rate was 4.125 percent and 4.625 percent for general obligation bonds and revenue bonds, respectively, depending on which was put up as security by the community for the loan.

Urban Planning Assistance: A grant program (section 701 of Housing Act of 1954).

Administered by: Urban Renewal Administration.

Purpose.-To facilitate urban planning for smaller communities (less than 25,000 population) which lack adequate planning resources. The grants are made to official State, regional, or metropolitan planning agencies. The planning shall be for surveys, land use studies, urban renewal plans, technical services, and other planning work, but excluding plans for specific public works. Terms of grant.—It shall not exceed 50 percent of the estimated cost of the work for which grant is made.

Applications, coming in to regional offices, average $350,000 per month. No applications received subsequent to December 16, 1957, have been processed, because of lack of funds.

At the present rate of applications for loans, not only the $30 million available, but also the $25 million impounded by the Budget Bureau will be needed. It is believed that many colleges are withholding applications and in fact are discouraged from submitting applications because of the small balance in the fund. The current interest rate on college loans is 3 percent. According to law, the Treasurer computes the average interest paid on all Government obligations and adds one-fourth percent. This is done at the end of each fiscal year and is applicable for the ensuing year.

The administration has recommended another $200-million loan fund authorization for fiscal 1959.

URBAN RENEWAL PROGRAM

This program, originated in 1949 to provide Federal assistance to communities for slum clearance and urban redevelopment and broadened in 1954 to help communities prevent the spread of slums and blight through rehabilitation and conservation of deteriorating areas, has made real progress in the past year. The program has been slow-moving because of the extremely complex procedural problems in getting local clearance and Federal approval of the urban renewal plans. The time requirement has been from 4 to 7 years from original planning to completion. Up to the present date, only 4 projects have been completed, but 521 projects have been approved for assistance.

Recent activity of the program is indicated by the following data:

The basic issue faced by the Congress in urban renewal legislation is the approval of the amount of capital-grant authorization. In 1957 capital-grant funds were depleted to the point that URA had to issue rationing regulations. Many communities were turned down for lack of funds after they had spent considerable time and effort in preparing applications. The Housing Act of 1957 authorized $350 million additional capital-grant money, making a total authorization of $1,250 million. Of this amount, the Budget Bureau is withholding $54.4 million. The URA has been flooded with applications estimated at about $360 million for this year. It is estimated that URA will have a backlog of well over $200 million of pending applications by the end of the year.

1 Congress authorized an additional $100 million subject to Presidential allocation (1955 act). This amount has never been released.

The status of community participation as of March 31, 1958, is as follows:

POPULATION AND HOUSING FACTS-UNITED STATES

1. Population.-172 million (as of January 1958)-increase of 15 percent from January 1950 population of 150 million. United States adding about 3 million population per year-estimated to reach 180 million by 1960, 193 million by 1965, and 210 million by 1970.

2. Births.-4,302,000 in 1957. This is the highest in history of United States. Compares with 3,649,000 in 1950 and 2,559,000 in 1940.

3. Marriages.-1,516,000 in 1957. This is down 3.4 percent from the 1956 figure of 1,569,000. Compares with 1,667,000 in 1950 and 1,596,000 in 1940. The 1957 marriage rate of 8.9 marriages per 1,000 population is far below the postwar peak rate of over 12 and is one of the lowest rates in history. Marriages in 1958 are likely to be less than 1957 because of continuing effect of low birthrate of midthirties and the present recession. However, marriages are likely to continue to increase to reach a peak in midsixties following the increase in number of young people reaching marriageable age. Reference to following figures will give some idea of potential new marriages:

19551960

1965

1970

Estimates of populationage 18 to 20 6, 507, 000 7,300,000 9, 300, 000

10, 900, 000

By 1965 we can expect 43 percent more marriages than in 1955, assuming the same economic conditions.

Nonfarm households increased at a rate of over 1 million per year for last several years. Farm households lost about 150,000 per year over last several years.

5. Dwelling units

Estimated about:

December 1956

March 1958__

Substandard dwelling units:

December 1956--

National vacancy rate (1st quarter, 1958):

For rent or for sale..

For rent____

For sale--‒‒‒

55, 340, 000

56, 500, 000

13, 000, 000

Percent

2.8

2.2

.6

6. Source of housing demand.-(a) Net household formation: about 1 million per year in nonfarm areas.

(b) Houses torn down, demolished, burned, etc.: about 400,000 per year have been lost since 1950.

(c) Family mobility or net inmigration into certain tight housing market areas: No data on this, but is probably as important as the other two sources of demand. About 1 out of 5 families move every year. Those moving into already crowded areas create a big demand for housing.

Hon. JACOB K. JAVITS,

NEW YORK CITY, May 12, 1958.

The United States Senate,

Washington, D. C.

DEAR SENATOR JAVITS: Thank you for offering to bring this letter and its subject matter to the attention of the proper committees of Congress.

It is my understanding that the Government Operations Committee of the House of Representatives is exploring the nature of the civil defense shelter requirements and the scope of practical, possible solutions.

The point of departure for my letter is the assumption that some sort of shelter construction program is needed and, as a practical matter, can be undertaken.

My associates and I, along with other groups, are engaged in carrying out or have under construction various title I FHA urban rehabilitation projects in various major cities. By coincidence, all major cities have become important potential targets for enemy atomic attack.

Irrespective of whether actual attack is to occur, it would appear necessary to provide our citizens residing in major cities with the belief that, in event of hostilities, they have at least minimal chance of survival. Otherwise in time, it will probably be impossible to command the necessary political support from the electorate for a strong foreign policy and the military and foreign aid programs relating to such a policy.

I am reliably informed that technical solutions to the defense shelter problem are in a state of flux owing to changes in the nature of possible attack with its resultant effect on the time that prudence and conditions dictate be allowed for advance warning to the civilian population.

Assuming that time for advance warning is confined to 15 to 30 minutes, then it seems mandatory that the shelter be incorporated in the structures where the populace lives and works.

Additionally, I am assuming that the Congress will probably conclude that protection against impact and the direct blast effect is financially impractical and that, consequently, shelter may be confined to protection against fallout and incidental damage from radio active sources during a 30- to 60-day period when plans for mass evacuation from the exposed area might be implemented.

Another valid assumption seems to be that it is impractical to contemplate that the office and residence structures in our major cities will be reconstructed in their entirety to meet the defense shelter problem and, as a result, the problem will be dealt with piecemeal in the general course of new construction.

On the basis of the above assumptions, I recommend that the Congress consider enacting amendments to existing FHA and other appropriate legislation to provide for federally financed incentives to permit and pay for the costs of including such adequate civil defense shelter facilities as may meet minimum technical requirements to be established by designated appropriate executive departments or agencies.

The title I urban rehabilitation program is gathering momentum and any delay in reaching decisions as to how to provide for the defense shelter requirements means the passing up of additional opportunities for meeting defense shelter needs in the new building sponsored by the FHA, title I program. Consequently, I believe action should be taken before the adjournment of Congress. Kindly feel free to call upon me directly or though my counsel, Mr. William R. Burt, (whose office is in the Barr Building in Washington, D. C.) for any assistance that I may provide to you or to the appropriate committee of Congress in this matter.

Respectfully submitted.

HERBERT S. GREENWALD.