Senator MILLER. I have not, Mr. Chairman. However, ISenator SPARKMAN. You did see the letter that Mr. Slayton, the head of urban renewal, wrote?

Senator MILLER. That is correct, Mr. Chairman, and I have quoted briefly from that in my remarks.

Senator SPARK MAN. Yes, I notice you quoted it.

Senator MILLER. As I say, I have not seen the letter, but we recognize that Mr. Slayton is in good faith in wanting to have the maximum discretion. The chances are, if Mr. Slayton had been personally in charge of the immediate activities in connection with the Erieview project in Cleveland, that there would not have been 84 substandard properties declared when only 24 should have been.

But, unfortunately, Mr. Slayton is just one person far removed from the discretion of many of his local supervisors, and we cannot see that there would be any harm done whatsoever by writing in the guidelines in the law.

After all, it just repeats what Mr. Slayton's office itself has come out with in the form of regulations. But we think that putting that in the law might serve a salutory purpose to prevent repetition of these two unfortunate incidents which I referred to.

Senator SPARKMAN. The thought occurs to me that an urban renewal area might contain some good usable buildings in it but in order to carry out the purpose for the renewal of the area the buildings would be in the way even if they were good usable buildings.

For instance, suppose you had a downtown area that you were going to rebuild altogether and you had usable buildings in that area. Could the project be put through?

Senator MILLER. Mr. Chairman, I can understand how peculiar situations may arise, and this particular problem that you have posed gave us some concern.

We believe, however, that the phrase "which can be economically improved or modified to meet requirements reasonably established" would cover that.

After all, we have got to expect the court to enforce such a law on a reasonable basis.

But the beauty of this amendment would be that it would force the administrator in that situation to come in to the court, if the owner of that property brought an action, and show that the plan which would, in effect, exclude the building you refer to is a reasonable plan. Now, if it is, he ought to be able to establish that, and we do not think it is too tough a burden to put on the administrator in a case like

that.

If it could be shown that the modification of this building would be something that would be economically impossible to attain to meet a reasonable plan, then we do not believe that there would be any difficulty in the court deciding that the property would have to go. But the burden of proof is going to be on the administrator to show

that.

Senator SPARKMAN. Well, we will certainly be glad to give consideration to your measure.

Senator Tower, would you like to ask him any questions? He has testified on a bill that he has introduced.

Senator TOWER. I am familiar with the Senator's bill, and I have no questions. I think he's got some pretty good ideas.

Senator SPARKMAN. Thank you very much, Senator Miller. Senator MILLER. Thank you, Mr. Chairman and members of the committee.

Senator SPARKMAN. Our next witnesses will be the Government witnesses, Dr. Weaver, Administrator of HHFA, accompanied by the heads of his various constituent agencies.

Dr. Weaver, we welcome you back to our hearings, you and all of your associates.

For the benefit of the record, will you identify each one of them? STATEMENT OF ROBERT C. WEAVER, HOUSING AND HOME FINANCE ADMINISTRATOR; ACCOMPANIED BY SIDNEY WOOLNER, COMMISSIONER, COMMUNITY FACILITIES ADMINISTRATION; WILLIAM SLAYTON, COMMISSIONER, URBAN RENEWAL ADMINISTRATION; PHILIP BROWNSTEIN, COMMISSIONER, FEDERAL HOUSING ADMINISTRATION; STANLEY BAUGHMAN, PRESIDENT, FNMA; MARIE MCGUIRE, COMMISSIONER, PUBLIC HOUSING ADMINISTRATION; AND MILTON SEMER, GENERAL COUNSEL,

HHFA

Dr. WEAVER. Starting at my right, Commissioner Woolner of the Community Facilities Administration.

Next to him, Commissioner William Slayton, Urban Renewal Administration.

Phil Brownstein, Commissioner of FHA, Federal Housing Administration.

At my extreme left, Mr. Stanley Baughman, president of FNMA, Federal National Mortgage Association.

Next to him is Mrs. McGuire, Commissioner of PHA, Public Housing Administration.

And to my immediate left, Mr. Semer, who is the General Counsel of the HHFA.

Senator SPARKMAN. Mr. Semer is back home.

We are glad to have all of you.

Senator JAVITS. Mr. Chairman-
Senator SPARKMAN. Yes.

Senator JAVITS. If I may

Senator SPARKMAN. I am sorry. Senator Javits wanted to make a few comments before we started the testimony.

Senator JAVITS. Mr. Chairman, I shall be very brief.

I am very pleased to be participating for the first time as a member of this subcommittee in a major review of the housing law, a subject with which I have dealt ever since I have been here in Congress.

The bill before us is necessarily long and complex, and I shall not endeavor to review it, but I do wish to call to the attention of the witnesses two points which are of major consequence to me. Rather than wait for the question period, I would like to present these issues to them so that, if they will, they might comment on them in the course of their testimony, as they may be relevant to more than one aspect of the bill.

The first is our feeling in New York, now backed up in a very impressive way, that air rights over railroad rights-of-way, bridge and tunnel transportation, subway storage yards and highways should qualify as an urban renewal base the same as land for middle-income housing.

We have actually tried this out in New York, as anyone knows who has seen, for example, the project at the George Washington Bridge in Manhattan, which is in the congressional district I used to represent in the House.

And so I would hope that some attention would be given to this concept for big cities. It is extremely important to us. And I believe it is a totally new and exciting, provocative possibility for other big cities in the country.

The second point relates to a very interesting colloquy, Mr. Chairman, which I had with the chairman, to which I would like to refer, in connection with the last time we really debated this whole issue, which goes back to 1961. I have reference to the debate on June 28, 1961, in the Senate in which the chairman of this subcommittee and I exchanged some views as to whether we really were doing what needed to be done for the middle-income family and the moderate-income family, especially those needing rental housing, in the 1961 bill.

Now, I have not yet had, though I have requested it, an accounting— and I do not use that word invidiously, but it is really what it comes to a report-as to the experience with what we designed under that bill to deal with this particular problem.

We need that in these hearings.

The second point I would like to lay before the group is the experience of New York with middle-income housing financed on the concept of limited profit, importantly with cooperatives, and financed through the New York State Housing Finance Agency, which is now a billion dollar going concern without State guarantees or a strain on the State treasury but under State auspices, and which has now financed 29 projects, including 6,853 apartments completed, with 21 other projects under construction, including 17,659 apartments, and 11 more in planning, or 5,950 apartments, or, in round figures, a total of about 60 projects accounting again in round figures for about 30,000 apartments. Now, this is based upon the pooling of the risk of these projects and the issuance of bonds to cover them by a central State agency, with eligibility for special arrangements with municipalities with respect to taxation, and without State guarantee.

We also, of course, are continuing the so-called Mitchell-Lama program which still has about $150 million in loan funds. That is direct State loan for the same purpose.

And, finally, we have added to that a new program called the homeowners' purchase endowment, which enables low-income families to borrow in order to acquire cooperative apartments. That is an authorization of $40 million and it has made 2,119 loans.

There are very enterprising private-enterprise activities in the housing field, especially in the area where help is very urgently required, as is shown by this bill.

This bill is very heavily concentrated upon the same general area. And I submit these two propositions to the administration really through the witnesses not in any hostile sense at all. I think my

credentials are pretty good on that in terms of the support of housing going way back to the Taft-Ellender-Wagner bill of 1949, which I think I had a good deal to do with getting through the House. But this is only by way of stimulating new ideas, new thinking, fresh air in a situation which can always stand new and provocative ideas, and with the greatest respect to the Administrator of this Agency and his desire and good faith to do everything humanly possible to accomplish precisely the same objectives which I have and which I know I share with every member of the committee.

But I did want to submit those.

Now, I might say, to, while I have got the floor that I am very pleased to see a number of things done here in the administration's recommendations. One, I like very much what you are doing about relocation allowances. I have had bills in on that, and at long last small business and other problems are gaining far more recognition than they did.

Again, it is not your fault. But it is just that the time has come at long last.

And also the problem of home mortgages in default. I am glad to see you are doing something about that.

These new concepts of entirely new communities and payments to the elderly and lower income families and so on, we will go over in connection with the questioning.

There is one other thing I would like to call to the witness' attention, Mr. Chairman. That is, I have got a bill in with relation to defects in construction, S. 2226, which I hope, too, in the course of the hearings the Administrator will give us some view on, as to its desirability and timeliness with respect to the general housing complex.

Thank you, Mr. Chairman.

Senator SPARKMAN. Thank you, Senator Javits.

I may say that your bill to which you made reference is included in the list to be considered in the course of these hearings.

Senator JAVITS. Thank you.

Senator SPARKMAN. With reference to the programs that you mentioned that have been tried out in New York, you will recall that in 1960 we had some hearings here on them and other proposals to establish a program for middle-income housing.

All right, Dr. Weaver. We shall be very glad to hear from you. Dr. WEAVER. Mr. Chairman and members of the committee, I appreciate this opportunity to present the views of the administration on the housing and community development legislation being considered by you today.

Accompanying me are the heads of our five constituent agencies who have been introduced and who will assist in discussion of provisions affecting their respective activities.

In this statement, I shall discuss primarily the objectives and principal provisions of S. 2468, introduced by Senator Sparkman, which is the administration's omnibus housing bill. I would like to submit for the record a more detailed statement on the specific provisions of that bill and S. 2469, a bill relating to the sale of mortgage assets by the Federal National Mortgage Association.

I want to acknowledge that several of the provisions of the administration's omnibus housing bill are adapted from other bills on which

you are also holding hearings: S. 981 introduced by Senator Williams of New Jersey; S. 1170 and S. 2031 introduced by Senator Clark; S. 1200 introduced by Senator Gruening; S. 2086 introduced by Senator Brewster; and S. 2226 introduced by Senator Javits.

Three years ago in his housing message to the Congress, the late President Kennedy said:

A nation that is partly ill housed is not as strong as a nation with adequate homes for every family. A nation with ugly, crime-infested cities and haphazard suburbs does not present the same image to the world as a nation characterized by bright and orderly urban development.

The Congress responded to the late President's recommendations and enacted the Housing Act of 1961.

On January 27, President Johnson in his housing message to the Congress said:

The dramatic increase in our Nation's population projected for the coming decades-over 300 million by the year 2000-and the increasing concentration of our population around urban centers will create increased housing needs and intensified problems of community development which must be anticipated and acted upon immediately. * * The substantive programs I have proposed

in this special message will speed our solutions to today's problems and the predictable needs of tomorrow.

To provide legislation necessary for this purpose, the President recommended enactment of the administration bills before you today. In the past 3 years, we have seen the homebuilding rate rise to 1,600,000 units, a 25-percent increase over 1960.

The number of communities undertaking urban renewal in this period has risen 56 percent, to a total of 743, and the number of projects has passed the 1,500 mark, a 76 percent increase.

We have authorized 100,000 new public housing units, approved financial assistance for 234,000 college housing accommodations, approved 500 public facility loans for small towns, exclusive of emergency loans for accelerated public works and area redevelopment, and we have approved 1,600 advances to local governments for planning public works projects. All of these represent sharp increases over the past.

We have also successfully launched FHA's new moderate-income housing programs, with commitments during this period totaling nearly 110,000 sale and rental units. As you know, this legislation expires in 1965, when I assume there will be a full review of this particular program, or these programs I should say.

We have also approved 98,000 units of housing for the elderly under our several programs.

These are some of the indicators of how our housing and community improvement programs have been accelerated and advanced under the Housing Act of 1961.

The Administration's omnibus housing bill would deal with the unfinished business of the present and the impending needs of the future in housing and community development.

Its housing provisions would broaden the scope and make more effective use of our mortgage insurance and secondary market programs. They would give greater assistance to the housing industry to meet the expanding housing demand of the years ahead. They would extend FHA assistance to encompass land development for our urban growth.