Why do you have to have a numerical limitation on the size of a county to make it eligible to get a 701 grant? Mr. SLAYTON. The basic concept of the 701 planning assistance when offered in 1954 was to aid small communities who lacked resources and personnel for creating master plans for their communities or the county. The original population limit was 25,000. Subsequently it was increased to 50,000. The concept is to help the smaller communities and smaller places who do not have the resources to undertake that kind of a job. Senator CLARK. Why do you think if you get to 51,000 you have the resources and if you are at 50,000 you have not? Mr. SLAYTON. This would be true wherever you set the limit, of course, Senator Clark. Generally also we find the counties-although this may not apply to the specific counties you are referring to-frequently form part of a metropolitan area. Senator CLARK. I am just talking about counties which are not part of a metropolitan area. That is all I am talking about. Would the Agency, Dr. Weaver, have any objection to either substantially increasing or eliminating that 50,000 limit? Dr. WEAVER. I think we have run into a problem here, and that is if you eliminate that limit for the county I do not see how you would not have to eliminate that limit for the cities. I think you get the program completely changed in its scope and its purpose. I am not saying this might not be a good thing, but I do not think you could handle counties separately from the urban areas. Senator CLARK. Obviously you would not want to make this applicable to large metropolitan areas or large cities, but I suggest that with the pace of your urban progress that 50,000 limit is unrealistic, and it might well be doubled. How would you feel about that? Dr. WEAVER. I think we would have to look at that and see what the implications were. Senator CLARK. Will you let us have your views on that? It seems to me that the National Association of Counties in their testimony had a very valid point. I wish you would read their testimony and their evidence and let us have your views. As of the moment, I would like to see that 50,000 population limit substantially raised. Dr. WEAVER. May I say I take it we are in agreement that there has to be a limit? Senator CLARK. Not necessarily, but I would reluctantly agree with you if you think there should be. I realize, Dr. Weaver, that you must deal with the Bureau of the Budget. You must remember that. I do not. Senator MUSKIE. Would the Senator yield? Senator CLARK. That ought to help you in Maine, too. Senator MUSKIE. I thought you might be interested to know the American Municipal Association and the U.S. Conference of Mayors also supports that suggestion, as does the Advisory Commission on Intergovernmental Relations. Senator DOUGLAS. If I may make a suggestion, why do you not classify the counties in 50,000 to 75,000, 75,000 to 100,000, and see how many would fall into those groups? (ÍÍFA later supplied the following information.) VIEWS OF HOUSING AND HOME FINANCE AGENCY ON TYPES OF COMMUNITIES ELIGIBLE FOR SECTION 701 URBAN PLANNING GRANTS Senator Clark suggested that the population limit for section 701 assistance to municipalities and counties might well be increased from 50,000 to 100,000. The National Association of Counties recommended the removal of the population limit. The Advisory Commission on Intergovernmental Relations recommended that eligibility be extended to municipalities and counties with a population over 50,000 which are experiencing rapid urbanization. As originally enacted, section 701 of the Housing Act of 1954 authorized 50 percent planning grants for two purposes. The first was to facilitate urban planning for smaller communities lacking adequate planning resources. Grants for this purpose were to be made to State planning agencies to assist municipalities with a population of less than 25,000. The second purpose was to encourage and assist metropolitan and regional planning which is exceptionally difficult to achieve because of the multiplicity of local jurisdictions. The section 701 program was extended to two special situations in 1956 and 1957: (1) municipalities and counties with a population of 25,000 or more which are in disaster areas and have suffered substantial damage (Housing Act of 1956), and (2) areas threatened with rapid urbanization as a result of the establishment or rapid and substantial expansion of a Federal installation (Housing Act of 1957). The Housing Act of 1959 broadened the scope of the program to cover: (1) municipalities and counties with a population of less than 50,000, (2) any group of adjacent communities with a total population of less than 50,000, having common or related urban planning problems resulting from rapid urbanization, and (3) State and interstate comprehensive planning. The Housing Act of 1961 increased the grants to two-thirds of estimated cost, specifically included transportation planning in the comprehensive planning for which assistance was authorized, and removed the population limit for municipalities and counties in redevelopment areas designated under section 5(a) of the Area Redevelopment Act. S. 2468 would also remove the population limit for redevelopment areas designated under section 5(b). The Housing and Home Finance Agency is acutely aware of how important it is that planning related to urban needs be carried on at all levels-municipal, county, regional, metropolitan area, and State. Its concern certainly embraces the two situations emphasized by the National Association of Counties; namely, the larger counties and other governmental units (population over 50,000) within metropolitan areas, and the counties with more than 50,000 population outside metropolitan areas. The present ineligibility of these two types of jurisdictions for section 701 assistance is in no way a reflection on the importance of planning for the well-being and orderly development of these areas. Based on considerations of broad program priorities, the present scope of section 701 is limited primarily to those situations where the need for assistance is greatest-the smaller jurisdictions with inadequate planning resources and the metropolitan areas which usually present jurisdictional and other special problems. Plannnig assistance for the smaller places, which are generally not in a position to carry on their own planning operations, ordinarily must be channeled through State planning agencies. The Housing Agency believes the present scope of the section 701 program represents a reasonable measure of Federal support for urban planning at this time. Senator CLARK. Dr. Weaver, let us get back to this point which Senator Javits was raising and I got into about the proportion of funds that goes into commercial, or could go into commercial and industrial redevelopment, as opposed to that which would go into purely residential redevelopment. What would you think of a suggestion that we increase the eligibility of commercial and industrial renewal but cut the amount of the Federal subsidy from two-thirds to one-half, thus still giving a break to residential urban renewal but in instances where the local community is really determined to rehabilitate its own skid row, its commercial or industrial situation, make it easier for them to do it, but increase the tab that they would have to pay? Dr. WEAVER. I think there are several points involved here. I happen to feel there are many points of view in this, and this is a personal point of view really rather than an administration point of view at the moment. There is a great deal of importance in keeping the posture and image of urban renewal as it originally started, and that is primarily a housing activity. I think, however, that an urban renewal program that does not have the downtown feature to it is an incomplete one, because you have to have an economic base. But there is, I think, a danger in getting too much emphasis on the downtown aspect and not enough emphasis on the other aspect. For example, I said when I appeared here before to a question from Senator Sparkman that I feel we have gone as far as we ought to go in increasing the proportion of the program which is used in the downtown area. This was on the basis of our present formula, and this was on the basis of allocation of funds which I was thinking of. I now have some reservations about what would happen. First I will let Mr. Slayton say as to whether or not this would be economically feasible, because he knows this better than I, but I have some initial off the top of my head reactions of a negative sort that this might develop into what I consider an equal partner in this activity becoming the senior partner. I do not think this would be good for the program, but Mr. Slayton can speak to the economic aspects. Before he does, let me say I quite agree with you that this must be a question of judgment as to how far you are going to go. Certainly the residential should always be the senior partner. Mr. SLAYTON. It is the senior partner, and I want to emphasize again in the nonresidential projects there is a considerable amount of residential. This is the category that we have to put projects in, because of the way the law reads, but if it is not predominantly residential it must be classified as a nonresidential project. Senator CLARK. That is before and after. I have seen so many of these projects where they take a situation where it is more than 50 percent residential when you start and therefore it is eligible, and when you get through you have an awful lot less than 50 percent residential. If anything, this is really a loophole. Mr. SLAYTON. An example is the 120 projects we have that are under this nonresidential category, 120 as of the end of last year that were in advanced stages of planning or execution. In these 120 projects, 27,000 dwelling units are going to be demolished. In addition, in the reuse, 26 percent of the net area of the project is going to be used for housing and 13 percent is going to be used for public and institutional uses. So there is a great deal more residential activity before and after in these projects than you would normally think by the nonresidential designation. The nonresidential designation does not take into account the residential aspects of the whole thing. We do have some projects that end up all industrial. Senator Douglas has one in his city, but these are rather unusual. Also, the nonresidential projects do have the advantage of stimulating job opportunities in close-in areas in the city, so that those who live close in can have jobs close to their places of residence. So it has some basic social objectives, too. Senator DOUGLAS. For the sake of the record, I should say while I have exercised a somewhat negative influence on these nonresidential projects in the past that I have moved into a period of benevolent neutrality, also favoring a limited application of this principle, but I do not want to see it swallow up the basic purposes of urban renewal, which I have always thought should be to eliminate the slums and to pave the way for better housing for the poor. But I think we are getting toward a reconciliation, provided the nonresidential groups do not try to take over the entire program, or major part of the program. Senator CLARK. Would you not agree that there are a good many communities-I think there are several in Maine. I think of the city of Reading, Pa., as an example, where you never are going to get that Reading situation cleaned up until you can move those railroad tracks and get that outmoded, old freight stuff out of the way. Yet it is not eligible for urban renewal, and they do not have the local resources. Mr. SLAYTON. It is not eligible because it is not in itself blight. Is that what you mean? Senator CLARK. It seems to me it is blight, but I do not think it can be defined as blight under the act if that is the sole use and it is just railroad use and a freight station and is in good shape. We have had situations where railroad tracks were removed as part of a renewal project because the condition of the freight station really was a blight. Mr. SLAYTON. It does not solve the problem, though, does it? (The following comments were later submitted by HHFA:) COMMENTS OF HOUSING AND HOME FINANCE AGENCY ON SUGGESTION BY SENATOR CLARK WITH RESPECT TO NONRESIDENTIAL URBAN RENEWAL AREAS Senator Clark suggested that consideration be given to reducing the amount of the Federal grant for commercial and industrial renewal from the present two-thirds to one-half, accompanied by an increase in the exception from the residential requirement. While such an approach is possible, the Housing Agency does not believe that it is either justified or desirable. Senator Clark's suggestion arose out of a discussion which implied that there was a danger that nonresidential renewal was increasing at such a rapid rate that it would gradually become the dominant purpose of the urban renewal program to the detriment of housing objectives. It is unlikely that such course of events will materialize. Projects with a residential orientation have been and are expected to continue to be the principal objective of the program. As of December 31, 1963, only 25 percent of the total capital grant authority made available since the inception of the program has been used for the so-called nonresidential projects under section 110 (c). Even with the requested increase in the limit on section 110(c) exceptions, nonresidential objectives will not become the "senior partner" in the program. Also to be taken into account is the extent to which these so-called nonresidential projects do have a residential involvement. In the 120 nonresidential section 110 (c) exception projects in an advanced stage as of December 31, 1963, approximately 26 percent of the net acreage will be used for residential purposes while 13 percent of the net acreage will be used for public and institutional purposes. Part of the apparent reason for the growing concern about nonresidential renewal is the increasing number of projects aimed at revitalizing the decaying central business districts of cities. Because such projects are at the center of local attention, they tend to receive the maximum amount of publicity. By comparison, the less glamorous residential projects appear to be receding into the background. If, in fact, there was a tendency toward an unbalanced local program, this would be a cause for concern. However, of the 679 communities with urban renewal projects as of June 30, 1963, only 180 were carrying out projects under the section 110 (c) exception. Of these 180 communities, 76 had only 1 federally assisted urban renewal project. However, almost all of this latter group were small localities and the one project was concerned with revitalizing a central business district or providing land for industrial growth. Of the remaining communities, the great bulk were carrying out a nonresidential project as part of a balanced program involving both residential and nonresidential objectives. Such balanced programs would tend to be upset under variable grant formulas for different kinds of projects. The basic reason for not establishing a discriminatory formula for nonresidential projects is that such projects are equally necessary for the revitalization of American communities as are residential projects, and they should have the same Federal support. The nonresidential projects are aimed at eliminating the eroding economic base of the communities concerned. Unless this erosion is stopped there can be no realistic hope of achieving sound housing in sound neighborhoods. Without the jobs which are created by such projects, the residents of the community could not afford sound housing. Without an improvement in the tax base, the community could not afford the services and improvements necessary for sound neighborhoods. Senator CLARK. No, it does not. Going back, Dr. Weaver, to your section 101 and the rent supplementation program, I am quite unhappy about the administrative restrictions or limitations which you have written into that program for helping the elderly. In particular-I think Senator Williams mentioned this is the fact that the supplementation payments are only made for 24 months, which seems to me to be very bad, indeed. Now, that is a strong statement for me to make, but I wonder if you would give me the rationale and why we should not eliminate that 24 months. Dr. WEAVER. I think the reason is the reason I attempted to outline to Senator Williams, and that is the fact that the problem of the elderly family, both in housing and otherwise, is a problem which is indigenous to the family before urban renewal occurs and will remain after urban renewal has been completed. I think that certainly these families need assistance. They need more assistance than this provides. But I do not think this bill is the vehicle to provide all of the assistance that they need; and, if so, then all of the funds would soon go into solving all of the social problems, of which this would be only one, because you could go all the way down the line on all the social problems in the community under a bill which relates to housing and community development. Senator CLARK. I think I agree with you, and I was disappointed when you put these housing for the elderly provisions in the omnibus bill. What is the matter with S. 1170 as a separate piece of legislation? Dr. WEAVER. I do not know how I can answer that. Senator CLARK. It is a little "quickie," I will admit, but my philosophical feeling is that since you have a problem of housing for the elderly you have a problem which overlaps a little bit in urban renewal, and why should not the Senate of the United States pass two bills, one dealing with housing for the elderly, in which you as the HHFA Administrator very naturally have a keen interest, and another housing and urban renewal bill? Why do we have to mix them up and say we cannot have this provision out of 1170 in the housing and urban renewal bill because it does not fit the pattern of our previous thinking? Dr. WEAVER. I can answer that in part, and that is to justify why I have suggested putting what we have suggested putting in this particular bill. This represents that segment of the problem which I believe is a legitimate cost to urban renewal. The urban renewal occasions this discomfort. It occasions this displacement, and therefore I think it is a legitimate expense for urban renewal. |