paid to elderly tenants occupying housing rented by private owners. We would limit such assistance to those living in housing operated by nonprofit or limitedprofit organizations such as churches, unions, or cooperatives.

Thus, an amendment to the section 202 direct loan legislation or to the section 221(d) (3) low- and moderate-income legislation for a program of rent supplementation in nonprofit, cooperative, or limited-dividend housing would be helpful. This need not be administered by the Federal Government sending a check to an individual to make up the difference between what he can pay in rent and what the actual economic rent would be, but through a reduction in the amortization charges of the nonprofit or cooperative corporation. This would remove much of the welfare aspect.

There is a beginning to rent supplementation in the Housing Act of 1964 on a very modest basis for persons dislocated in urban renewal areas. They will be provided rent supplementation for a transitional period of 2 years—if the bill passes in order to be able to live in standard housing despite low incomes. Housing for the elderly is a different phenomenon from housing for people of all ages. To be successful, senior citizen housing should include access to health facilities, recreation activities, a lounge space, craft shop, hobby work, a senior center, and the necessary equipment for these facilities. In the loans made by HHFA for such housing, as much space as possible is included for the development of such facilities. However, generally these have to be cut to a minimum since their incorporation increases the cost of construction and therefore the size of the loan. Consequently, the rents to be borne by the residents of the projects are proportionately higher in order to pay off the loan for these facilities.

Health, recreation, social services, sheltered workshops are programs that could be used not only by residents of the projects but by the community as a whole. This would be healthy not only for the residents, but for the community. Therefore it would seem feasible to limit the loan program in senior citizen housing to the dwelling units and have them on a completely self-liquidating basis. However, these loans could be complemented by grants to the nonprofit groups who build housing for the elderly under HHFA programs for the construction and operation of health, recreation, and social service facilities so important to a successful project of housing for the elderly.

SPECIAL ASSISTANCE TO THE ELDERLY HOMEOWNER

Last year when I appeared before the subcommittee, I read excerpts from a letter from an aged single man living alone who retained legal title to his home located in upper New York State. The old gentleman had the most meager income (somehow or other he was not eligible for social security payments). The house he owned had no indoor plumbing: the water supply froze in the winter time. However, it appeared that the house was located on a good plot of land and could have been fixed up both as a marketable dwelling and more important a place where the owner could live out his remaining years in reasonable comfort. I cite this case of course to illustrate the need for the type of assistance for elderly homeowners proposed—the legislation you are now considering.

Rehabilitation loans at less than market interest rate with deferral of principal payments for older persons living on minimum incomes in their own homes could become a boon to many, many of the people for whom we speak. This provision of the law should not be confined to those living in urban renewal areas. The FHA should be enabled to guarantee loans of this type for persons whose homes might be located anywhere.

RURAL HOUSING PROGRAM

The National Council of Senior Citizens wishes to support those sections of title V of the bill which contain several provisions for extending and expanding a rural housing program that is adapted to the special needs of the senior citizens that live in rural areas. This is a very significant part of the total housing effort for 1 out of every 3 people over 62 living in a rural part of our country.

One provision of title V would extend to June 30, 1968, the authority of the Farmers Home Administration, an agency of the Department of Agriculture, to insure loans to finance rental housing for senior citizens in rural areas.

The first of such rural projects was completed in Ocean County, N.J., last summer. The housing there is contained in neat, modern, one-story buildings. There are no stairs to climb, electric outlets are located at waist height to eliminate stooping and grab bars have been placed in bathrooms for added safety.

Fireproof walls separate each apartment. A hospital is only 2 miles away, 10 doctors live within 5 miles of the project, a community center is nearby.

These homes are occupied by retired farmers and their wives. The location in the rural area enables these elderly couples to remain near their families and in the community they have been a part of for most, if not all, of their lives. The alternatives, so far as living quarters are concerned, would have been far less attractive, if not in some cases downright disagreeable and demoralizing. What are these alternatives? Doubling up with the children, trying to heat and maintain a home two or thre times larger than needed, moving away from friends and family to an urban environment.

We believe the Farmers Home Administration has made a good start in launching this phase of the senior citizen housing program. We look forward to an expansion of this type of assistance.

Another provision of title V would place on an insured basis the loans to individual farmers and rural residents for the construction and repair of housing. It is our understanding that this would expand these loans to a level that would come closer to meeting the need. Through the years the demand for these loans has far outrun the funds available.

We are heartily in favor of an expansion. We would urge the committee to make certain that the revisions made in the bill would provide a housing program of adequate dimensions.

Last year these loans fell somewhat short of $200 million. We would favor a program in the $400 to $500 million range.

In the fall of 1962 these loans to individual families were adapted to the needs of the elderly. Those 62 or over can now obtain loans to buy housing tracts and buy existing housing. When they are short on repayment ability the children can cosign the note.

These amendments have meant a great deal to hundreds of senior citizens in rural areas and the program will grow in importance in the years to come.

We would also like to be on record as favoring the provisions of title V that would vastly improve the loans made by the Farmers Home Administration for the construction of housing for farm laborers. It is our understanding that the provisions in the bill would make it possible for the agency to contribute up to two-thirds of the cost of farm labor housing projects. This would be a very vital step in the creation of adequate housing for the poorest housed of our Nation's people.

Senator WILLIAMS. Mr. Theodore T. Dorman, who is administrator of the United Church of Christ Homes, Inc.

STATEMENT OF THEODORE T. DORMAN, ADMINISTRATOR, UNITED CHURCH OF CHRIST HOMES, INC.

Mr. DORMAN. Mr. Chairman, my name is Theodore Dorman, I am administrator for the United Church of Christ Homes, and I have come to talk to you today particularly about the direct loan program.

My board and I have found a site, we have drawn up plans, and we have let the contract for the first 202 project for the metropolitan area of Washington. Actually, our number is four, so there have not been too many of these projects built.

I am very glad that you are interested in this program, because I can tell you a great deal about it. I am not an expert on the Federal Housing Act, but I certainly know something about going to a regional office and getting an application and then sitting down with the application and trying to figure out how to fill it out and proceed with a 202 project.

Now, I think that these 202 projects could be of probably the greatest value in housing for senior citizens in the country today.

In the first place, you cannot call this program in any degree socialistic. It simply allows sponsors of good reputation to borrow money, which is paid back over, as you know, 50 years, actually 48 years, as there is no payment on principal for the first 2 years.

It affects church groups such as I am representing today, we represent 41 churches in the Washington metropolitan area and the Baltimore, Md., area. It is a question of two churches coming together, Congregational Christian, and Evangelical Reform, forming the United Church of Christ.

Now, without this legislation, we would not be able to do what we are doing today. It has been agonizing in many respects. I do not think that I have ever undertaken anything which has been more difficult in actual patience, but we have had tremendous help from Mr. Sidney Spector and Dr. Leeds. These two men have consoled us and helped us when we felt that the situation was desperate.

I think, Mr. Chairman, the main difficulty is that you have a decentralized program, and you have a number of different regional offices. Some of these offices are excellent, and some of them are extremely trying.

We had a most disagreeable experience in our regional office. We found that it was almost impossible to break through the aura that surrounded this office, and I think that if I had not spent 211⁄2 years, myself, personally, in the Federal Government, I would have gone away from the regional office and said: "It is impossible to get a 202 loan."

Instead of that, I came back, counseled with people in Washington, we proceeded with it, and we broke the track record, because we got a loan processed in 1 year's time.

Now, this is practically unheard of. I do not think this could be done unless there was a good bit of technical know-how. I think that the average layman who went out to get a project approved under the 202 loan would have to get some technical help.

In the first place, the application is this thick [indicating], and it is a very, very, very difficult situation to deal with. But it is rewarding. Senator WILLIAMS. You say "this thick." That does not, of course, appear in the record. You are indicating several inches there?

Mr. DORMAN. I think it would weigh about 7 pounds, the long form. which has just come out.

The chairman of our board is a remarkable man. He is an attorney, an accomplished person, and an application like this just excites him. He enjoys filling them out. To me it is terrifying. But to this man it is a challenge. And he was delighted with that long form. This I think would probably not be prevalent, generally speaking.

We are very fortunate, in that we are building our unit right in the heart of Silver Spring, Md. This home will consist of 109 efficiencies and 15 1-bedroom units. And, Mr. Chairman, half of the applications that we are getting now, of course-people have to be 62 or over-are from married couples, who are tired of the plumber and the roofer and the rest of it, and they want to come and live in a project such as ours, where the emphasis will be on independent living, entirely on independent living, but the arm of our church will be around them in case they need help.

Senator WILLIAMS. What size loan?

Mr. DORMAN. $1,540,000 total loan, construction costs-well, we are bid, so I can tell you what our construction costs will be, which are $1,138,035.

Senator WILLIAMS. Have you projected the rental?

Mr. DORMAN. Yes, we have to project the rental before the application is processed, because the budget must be drawn up. This is one of the things that you go through. This, of course, as you know, is an extremely high rental area that we are building in.

We figure that we will be able to rent an efficiency, air conditioned, with a kitchen in it, and all utilities, for approximately $92 a month. The one-bedroom apartments will be $115 a month.

This is a projected budget. In this area, the rents would be, I expect, approximately 40 percent higher than this.

There will be central dining for 50 people at one time, too, incorporated in this project.

Senator WILLIAMS. What is the cost of your money, under the law? Mr. DORMAN. Three and one-half percent at the present time, over a 50-year period, which would give a charitable organization, or a good nonprofit sponsor, an edge.

Well, there are arguments about this, but I set a figure. An edge of about $18 a month rent, as opposed to conventional financing. And this is a tremendous assist.

We represent a middle-income group, middle- to lower-income group, who will profit by this, of course, and anybody else who wishes to come in, as the 202 projects, as you know, are open-end projects. We feel that there are just one or two things that I would like to stress, as a suggestion toward you, in legislation.

We are taking in approximately 139 people, Senator. We feel that we have an obligation to those people in the future regarding health. Now, we hope that we are going to keep them so happy that they just live out their lives and die a natural death, but there is a possibility that they will become incapacitated. We will not be able, then, to care for them, when they do. Our church group, this corporation, would like to build a nursing home, would like to build it soon, but there is absolutely no purpose in our building a nursing home in which we have to charge $325 to $800 or $900 a month, as is the custom in nursing homes throughout this area.

In other words, the area is reaching a saturation point regarding high-priced nursing homes. Our church group would like to build a nursing home in which we would have the benefit of this advantageous financing, so that we could take care of the people who get sick at a lower rate. Then the world would beat a path to your door. And I have a suggestion, here, of amending section 232, adding the words "and private nonprofit."

Senator WILLIAMS. I want to get the full import of what you are saying, here. What is the limitation now, that you are expanding? Mr. DORMAN. On nursing homes?

Senator WILLIAMS. Yes.

Mr. DORMAN. Our difficulty is now that there is no provision for nonprofit in nursing homes. In other words, it is the same as though it were proprietary. And we feel that this is an obligation, a Christian obligation, which we have, to our guests in this home.

Now, there is another limitation under section 202, Senator, which says that we cannot take anybody in as a resident if they have an income of $4,000 a year or more. We are not subject to this, because we filed our application before this went through.

Personally, I feel, and my board feels, that this is segregating people according to income. We feel that community facilities will go ahead

with sponsors who do not have large rich groups, but I see no sense in discriminating against somebody in a facility such as this, because they happen to have an income of $4,000 a year.

This is just putting people into brackets according to their income and I think that the person who has an income of $4,000 a year might very well profit by associating with some people who have less income, and you get a better cross section of your country.

And I do not think that this is a very sensible inclusion in this law, After all, if your screening is done properly, you are not going to accept as sponsors people who are building society houses for the rich, and that sort of thing, but $4,000 a year is not a great deal of money, any more, and I think that this is a mistake.

I would second Mr. Edelman's suggestions on some research being done in finding out just exactly what senior citizens want in housing. You know, they will not tell you. You go out and ask them, and they will not tell you.

I have been in this field for 9 years, and they are always suspicious when you ask them questions, if they are sitting in their home. But I would suggest that some grants be established for the housing authorities to go in and talk to the elderly and find out from the elderly whether they like these facilities, and what suggestions they make.

They will tell you after they have gone into these facilities, and have been exposed to them. But you can go and interview people over 62 until you are blue in the face, when they have not been subjected to surrounding, and they feel that it is none of your business, particularly, and they will not give you much information.

But some sensible research in this line, under the auspices of the Housing Administration, which is vitally interested in this some grant money would be very acceptable, I think.

Also trained personnel is in a great shortage. I am the chairman of the administrators and superintendents of home for the elderly in the metropolitan area. There are 22 of us at the present time. It is an association. And we all realize that there are very, very few people who are qualified in any way to run and see to it that these organizations are properly run.

It is a new field. It is a brandnew field. In our unit in Silver Spring-actually, there is no unit like this anywhere around. This is a brandnew conception. And we need trained personnel. Some grant money would be extremely to the point.

Senator WILLIAMS. You have 22 members of your association?

Mr. DORMAN. Of our association. It has just been newly formed, and this constitutes the newly built homes in our area and some that have been here for many years.

Senator WILLIAMS. Just this area?

Mr. DORMAN. Just the metropolitan area of Washington, yes.
Senator WILLIAMS. I see.

Mr. DORMAN. And we also have one more point which I would like to stress, and that is that we are going to have people, guests, in this home, who will come in saying, "We have an income of $70 a month. Where are we going to get the rest of the money?"

Well, I am going to go and beat my churches on the head to try and get that money up, but I am not sure that I can. If some legislation could be written that would be a way of reducing the cost of