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Mr. FOLEY. There is a provision here to reimburse them for those costs above the satutory costs that are now existing in our present act. If we get this relief on cost limits in this bill, we can reimburse them on deferred projects. That involves one project in the city of Chicago, one in the city of Milwaukee, and one in New York City, I think.
Mr. McMILLEN. Do you think it would be fair that that be done with all who have already provided the money for covering this great problem?
Mr. FOLEY. That is right. In the State of Massachusetts, I think, they have appropriated $200,000,000 for housing up there which is contemplated solely as a State program and it is a program to house veterans. It is limited to that.
Mr. COLE. Would you give me the name of a housing project in New York City ?
Mr. Egan. Any one?
Mr. COLE. It is only so I can have a designation because I am going to make a request.
How about one in California ?
Mr. COLE. One in the Middle West somewhere. I call the Middle West either Iowa or Kansas-or Illinois.
Mr. Egan. There is one in Omaha, but I do not know the name of it offhand.
Mr. COLE. Is there just one there?
Mr. COLE. Let me ask you, Mr. Egan, how difficult would it be for you to bring to the committee, and not for the record, but for anybody's examination, the original record of those projects that you have listed, showing the occupants and the names on the waiting list of those, and those not admitted and the reasons, and knowing the income at admission and the income of those occupants, now, the size of the family and the reason for admission?
Mr. Egan. I think we could give all of those readily with the exception of those not admitted and the reasons. I do not know whether there is a record as to those not admitted.
Mr. COLE. What I would like to do is look at some of these things instead of having you tell me about them. Would that be possible?
Mr. EGAN. I think that would be available.
Mr. MULTER. Would you like to have him also give the party enrollment of the tenants?
Mr. Cole. I will let somebody else argue that.
The CHAIRMAN. Do you have those records here, Mr. Foley?
Mr. Foley. We would have to get them from the field, I think, Mr. Chairman.
Mr. EGAN. We have to go to the projects to get it.
Mr. PATMAN. The annual reports, too, would be interesting. Do they not make annual reports?
Mr. Egan. That is correct.
Mr. PATMAN. Each city takes pride in doing that. You could bring them along, too.
Mr. EGAN. All right.
Mr. MULTER. All through the years when legislation of this type has been advocated, we have heard the objection raised that this kind of project will create unfair competition with private industry and deter private building. Will you tell us your view on that?
Mr. FOLEY. Very definitely I disagree with that statement, Congressman. I think it will not interfere with private building. I think it is not unfair competition with private enterprise. I think it will, on the contrary, create a general situation in which private enterprise in building in the residential field will be assisted. I think it is explicit as well as implicit all through this bill, and particularly in the Declaration of Policy. It seems to me there is perhaps a tendency to underestimate the importance of the Declaration of Policy contained at the beginning of this bill. It is of the greatest importance that such a policy be stated, in my opinion, and that policy very clearly sets forth that one of the fundamental purposes shall be the encouragement of private enterprise to accomplish all that it possibly can in the field.
The same thing is very specifically true in connection with the slumclearance provision. There is a field in which private enterprise admittedly has been unable to perform on the residential front because of the cost involved in making a site available for that type of housing in the congested slum areas.
The language of this bill very specifically defines the purpose to be to promote the possibility of private enterprise in that field.
In connection with the research program, that is particularly important and it is very pointedly directed toward increasing the effectiveness of private enterprise in the field. The whole tenor and spirit of the bill, even the public housing provision, which is said to be in competition with private enterprise by certain of its opponents is certainly not in competition with them and is certainly a champion of private enterprise.
I have a pretty strong conviction on this after a number of years of experience. It seems to me that if we are successful through this means of making the American system, of which governmental aid is a part, produce a healthier and more wholesome situation for the lower income groups of our people who admittedly cannot be decently housed otherwise, in the main, now, we will have removed from the scene one of the growing difficulties, one of the great problem areas out of which arises more and more of the contention that our private enterprise system is not good because it fails to take care of that situation.
In my way of thinking, the whole of the operation is, in essence, a private enterprise operation. To my way of thinking, and I have stated it many times, private enterprise in the building field and in the residential scene particularly is a combination not only of private management, private capital, and labor, but of governmental resources, too. Through the teaming of them together to do each the part that it can do and that it perhaps alone can best do, I think we further most the free enterprise system of this country.
I am sorry to have made such a long statement.
Mr. Brown. In clearing the slum of these cities, what percent of the cost does the local community contribute ?
Mr. FOLEY. Of the total cost, the local community would bear onethird and the Federal assistance two-thirds, on the basis of an aggre. gate result of the group of projects undertaken in a community. There was a careful investigation of that subject made by the committees of Congress in the past. A subcommittee of the joint committee last year sent a questionnaire throughout the country to the municipal governments and the results of that questionnaire, I am sure, are available to chis committee. The judgment arrived at from that study was that this was the practicable approach.
The CHAIRMAN. The cities are, in a great many instances, limited in their tax rate and limited in their expenditures, and they would have difficulty. Usually they have to do it by a bond issue, do they not?
Mr. FOLEY. They are limited in many situations with respect to their bond limit. They do not have the breadth of tax resources of the Federal Government.
Mr. Brown. I think it is true that some of the communities would not be in a position to contribute more than one-third but I believe some of the cities are in a position to contribute just as much as the Government.
Mr. FOLEY. I could not answer for every city, Congressman.
Mr. PATMAN. As a member of that Joint Committee on Housing, I was convinced that the cities would not do any more, myself. I am convinced now that if we were to require more of them, they just would not take advantage of the housing.
Mr. BUCHANAN. The reason is that they are financially unable to.
Mr. PATMAN. There are several reasons. Several cities will turn this down.
The CHAIRMAN. We could not write a law to cover the financial condition of each ctiy.
Mr. FOLEY. I think that is true, Mr. Chairman. This is a result of rather extensive studies.
Mr. MULTER. Having in mind that the city of New York and the State of New York are looked upon as being the richest city and the richest State in the Union, and they have reached the limit of their debt capacity in connection with public housing: do you not think that certainly would be typical of the situation in other parts of the country and that they cannot do any more financing on their own, certainly, if the richest city and State cannot? Is that so?
Mr. FOLEY. I would think so.
Mr. MULTER. Reverting to my original question, we have experienced also in the city and State of New York of public projects being built side by side with private projects. There has been no undue strain there upon the labor and materials there for private construction because of the public housing construction; is that not so?
Mr. EGAN. Yes.
Mr. MULTER. There would be no strain or drain upon labor and materials for private projects in this case?
Mr. Foley. I think that is particularly true in view of the flexibility provisions.
Mr. MULTER. Some mention was made yesterday about immediate relief and adopting a measure for immediate relief. This is not a problem that can be solved by sticking houses up over night and getting immediate relief, is it?
Mr. FOLEY. No. As a matter of fact, that is probably one of the basic causes of our difficulty, namely, that we never have worked out a long-range, comprehensive approach to our housing problem geared to meet some reasonable estimate of our needs over a period of time in the future.
You had the boom and bust cycle in connection with housing, and as long as we have had it, we have had a more or less faulty approach.
Since you have raised the question, Mr. Congressman, I might point out that we have now for some years been debating in Congress this general approach, a comprehensive bill not greatly different from the one before you. Up to this time one of the chief arguments against passarre has beer, "What we neel is something immediate, something today and something tomorrow, so we will postpone it." Arguments in opposition point out that we have to honestly state that if this bill is passed this month, it will probably be a good many months before houses will be occupied that are produced under it.
I think it is fair for me to point out, however, that had we enacted such legislation a year ago, those houses would now be coming into occupancy.
Mr. MULTER. If the Eightieth Congress acted in March of the first year of that session, you would probably have 200,000 units now occupied and another 150,000 units in the course of construction; is that a fair statement?
Mr. FCLEY. We would certainly be much further along the road than we are.
Mr. MULTER. We have to make a start somewhere if we are going to take care of the situation at all.
Mr. FOLEY. That is right. Fundamentally we are going to have to have in this country agreement upon a policy to be pursued with respect to housing and some long-range comprehensive plans to be carried out. Otherwise our emergency steps constantly being taken are likely to be misgeared and frequently mistaken.
Mr. MULTER. Reference was made awhile ago to the Baltimore plan of rehabilitating by force of law the slum areas and the like. Has that relieved the housing shortage in any area where that has been tried!
Mr. FOLEY. The Baltimore plan has been variously described by some as a slum-clearance plan, which it is not; by others as a plan for relieving the housing shortage, which, by and large, it is not; and by others as a means of preventing blight. To the extent that it was applied in the stages where it should be, it probably can be useful in preventing the further spread of blight. It cannot help in increasing
the housing supply, but can be very effective in improving the existing housing supply.
As a matter of fact, the governmental officials of Baltimore, I think, do not describe this as a slum-clearance plan but have properly described it as a step toward an improvement of the situation. It does not add to the physical supply.
If the police power, which is the basis of the plan, were extended to every city in the United States today, you would be reducing your housing very sharply and you would have no place to move those people to.
Mr. MULTER. It is obviously a problem that requires Nation-wide planning and not merely local planning.
Mr. FOLEY. It requires both, of course.
Mr. MULTER. It requires an over-all plan. We must, as a Nation, concern ourselves with it.
Mr. Foley. It requires, it seems to me, a great deal of local planning and a great deal of assumption of responsibility locally and the exercise of a great deal of local authority, which can be most usefully done and probably result in the quickest beneficial results if it can be geared into an agreed-upon national plan and some means of national assistance such as is proposed here.
Mr. MULTER. I do not know whether one of the questions yesterday was intended to intimate that H. R. 1938, whic' deals with finance, mortgage insurance and the like, would solve the problem, it might have left that idea with some. These two plans as embodied in the bill we have before us now, H. R. 4009, and that in H. R. 1938, are complementary, they can go along side by side, each doing its share to relieve the situation!
Mr. FOLEY. That is correct. That is correct. H. R. 1938, as I recall its provisions, is substantially the same as the one I have here testified upon in the Senate and will undoubtedly later testify upon here. They relate to private enterprise specifically through the insured mortgage system and through the development of the secondary market and through the further development of the cooperative plan, which we believe has a great deal of possibilities, although I think there may at this point in some minds be a danger of overemphasizing the im mediate results we had and the immediate general results. We believe the cooperative plan offers a great deal of possibility. Both of those bills, I think, need refinements in that field. Those are supplemental, as I say.
Mr. MULTER. H. R. 1938 is the same as Senate 712.
Mr. MULTER. Referring to the research provisions of this proposed legislation, is that intended to develop more prefabricated homes? Mr. FOLEY. I did not get the first part of your question.
Mr. MULTER. Referring to the research provisions of this proposed legislation,
Mr. FOLEY. You are probably referring there to the language, with regard to improved techniques. To the extent that prefabrication is an improved technique, it is included in that language. It would be a mistake to consider that was all that was meant. There are many possibilities of improved methods, improved materials, improved uses of materials.