Additional data submitted by-Continued National Association of Real Estate Boards: Schedule A. Rental-type multifamily dwelling units started...--- Page 525 526 Gardner, B. C., Jr., attorney, Albany, Ga., letter of July 5, 1958.. Excerpt from hearings, Subcommittee on Housing of the Daley, Hon. Richard J., mayor, Chicago, Ill., statement. Donovan, Hon. William J., mayor, Somerville, Mass., letter of Gardner, Hon. Arthur J., mayor, Erie, Pa., letter of May 9, 1958- Hartsfield, Hon. William B., mayor, Atlanta, Ga., letter of May Hynes, Hon. J. B., mavor, Boston, Mass, letter of May 2, 1958- Reynolds, Hon. Walter H., mayor, Providence, R. I., statement. Selland, Hon. Arthur L., mayor, Fresno, Calif., letter of May 7, Stull, Hon. Harvey M., mayor, Stockton, Calif., letter of May 409 Yager, Hon, John W., mayor, Toledo, Ohio, letter of May 15, 1958 Yancey, H. A., city manager, Charlotte, N. C., letter of March 422 413 Yerger, Hon. W. C., mayor, Rock Island, Ill., letter of May 6, 1958 410 Schedule A-Year end condition, December 31, 1959. Schedule B-Year end condition, December 31, 1960. Schedule C-Year end condition, December 31, 1961. Revised draft of proposed law authorizing the Mortgage Guaranty Corporation based on pattern adopted by Senate Subcommittee Section-by-section outline of July 1, 1958, revision of proposed 178 Wheaton, Wm. L. C., National Housing Conference, letter of July 314 Abbott, Miss Charlotte E., representing the National Consumers' League 706 American Hotel Association, Washington, D. C., statement. 740 American Institute of Certified Public Accountants, letter of July 15, 1958, 699 Butts, Porter, director, The Wisconsin Union, University of Wisconsin, 724 Citizens Committee for Children of New York City, Inc., telegram of July 678 Colburn, Fern M., National Federation of Settlements and Neighborhood 735 Comments on items raised by Congressman Rains' letter of July 756 Florida State Board of Health, letter of July 2, 1958, to Hon. Paul G. 677 Frates, G. H., National Association of Retail Druggists. Home Builders Association of Metropolitan Washington, Inc., letter of 708 Metropolitan Association of General Improvement Contractors, letter of Morano, Hon. Albert P., letter of March 13, 1958, to Hon. Brent Spence National Council of the Churches of Christ, letter of May 29, 1958--- Ostrem, M. H., Western State Life Insurance Co., Fargo, N. Dak., tele- Rose, Alvin E., executive director, Chicago Housing Authority, statement_ Rovelstad, Howard, professor, University of Maryland, statement... Sherman, Irving, Conference of Presidents of Section 213 Cooperatives, Spangle, Wm. E., Jr., Menlo Park, Calif., letter of July 9, 1958, to Hon. HOUSING ACT OF 1958 MONDAY, JULY 7, 1958 HOUSE OF REPRESENTATIVES, COMMITTEE ON BANKING AND CURRENCY, Washington, D. C. The subcommittee met, pursuant to notice, at 10 a. m., Hon. Albert Rains, chairman of the subcommittee, presiding. Present: Messrs. Rains, Addonizio, Barrett, Mrs. Sullivan, Messrs. McDonough and Betts. Mr. RAINS. The committee will be in order. I might say the subcommittee will be considering the Senate bill, pending bills by myself, Dr. Talle, other members of the committee, and other Members of the Congress. All of the housing bills that have been introduced will be considered by the committee. We will expect to use the Senate bill as somewhat of a vehicle to work on. For today we have listed the agencies. I see we have our longtime good friend, Mr. Cole, the Administrator of the Housing and Home Finance Agency, and he is accompanied by the heads of the various departments of his Agency. I am going to ask Mr. Cole to proceed in any way he sees fit. I think we will let each of you proceed with all of your statement and possible we will reserve questioning until this afternoon. You may proceed, Mr. Cole. STATEMENT OF HON. ALBERT M. COLE, ADMINISTRATOR, HOUSING AND HOME FINANCE AGENCY Mr. COLE. All right, Mr. Chairman, thank you. Mr. Chairman and members of the committee, I appreciate the opportunity to present the views of the Housing and Home Finance Agency on housing legislation of interest to your committee. Our comments will be directed primarily to H. R. 11173, the administration bill introduced by Mr. Talle, and S. 4035, the general housing bill recently reported by the Senate Committee on Banking and Currency. These bills would affect programs of each of the five constituent organizations of our Agency. I have with me the heads of these constituent organizations who have statements expressing the views of the Agency on legislation affecting their programs. In order to conserve the time of the committee, I will make a few general observations, if agreeable to you, Mr. Chairman. Also, following our discussion of other mortgage insurance matters, I will present the views of the administration on H. R. 10637, the Home Loan Guarantee Corporation Act, and similar legislation. 1 I have been authorized to advise that H. R. 11173, with additional proposals we will recommend, is in accord with the program of the President. That bill would provide legislation necessary to expand, or continue, or more effectively carry out, programs of the Housing and Home Finance Agency for the provision and improvement of housing and for the removal and prevention of slums and blight. These interrelated programs have the common objective of providing adequate housing in suitable neighborhoods for all persons in communities throughout our country. The programs also have a vital effect on our entire national economy. The residential construction industry is, itself, a major industry. It directly affects not only the producers and manufacturers of lumber and brick and electrical and heating equipment and countless other products which enter into the construction of a home, but also hundreds of other industries and trades which supply home furnishings and services and which depend for an important share of their business on continued residential construction. The Senate bill, S. 4035, contains some provisions recommended by the administration affecting our operations. However, that bill contains a number of very serious defects and undesirable provisions, as we will explain. They will be discussed, insofar as possible, with provisions on the same subject contained in the administration bill. FHA MORTGAGE INSURANCE Provisions on FHA mortgage insurance are contained in title I of the administration bill and in titles I, II, and VI of the Senate bill. Both bills contain a number of desirable provisions with respect to this subject, but the Senate bill is deficient in several major respects, as Mr. Mason, the Federal Housing Commissioner, will explain. It fails to deal with the problem of making maximum interest rates for rental housing and cooperative housing mortgages insured by FHA consistent with maximum interest rates for sales housing. It makes a number of unnecessary increases in FHA mortgage insurance ceilings on these project mortgages, both as to dollar amounts and as to the ratios of loan to value or loan to cost. These increases are unnecessary because existing ceilings are not an impediment to construction. They are undesirable because they would tend to raise the rentals or charges for the units involved. The Senate bill also fails to make realistic increases in the maximum dollar amounts for FHA-insured mortgages on sales housing. Mortgage ceilings on sales housing have lagged far behind cost increases and are thus thwarting the original intent of the Congress to make FHA mortgage insurance available to the bulk of American families. Among the desirable mortgage insurance provisions in both bills, I wish to call your particular attention to the proposed annual adjustments in the FHA general mortgage insurance authorization which would permit continuation of FHA operations over the next 5 fiscal years. Both bills would also make several changes in section 221 mortgage insurance operations for the purpose of providing more housing for families displaced from their homes by urban renewal and other governmental activities such as highway construction and code enforcement. An important change would extend this mortgage insurance program to rental housing produced by builders for profit, |