"The Congress further finds and declares that cities, both large and small, do not have adequate resources to deal effectively with the critical problems facing them *** The problem is not that the resources to do the job are absent from the cities, but that these resources are not always mobilized effectively. Certainly there are resources in the cities. Cities are the centers of the income and wealth which have brought the United States the highest standard of living in the world and made it the best housed of the nations. And, in fact, the subsidies envisioned in S. 2842 would be paid from taxes which come, in the main, from city areas. But the round-about route of funds-from city to Federal Government, and (after deduction of a Federal handling charge and imposition of Federal controls) back to the city-is not necessary. Instead, cities can, through effective organization and action, get far more direct access to the funds necessary for local progress. Documentation of the fact that it is possible for cities to mobilize their own resources for local improvements is provided by the examples, from 66 different communities over a wide range of population sizes, in the national chamber publication, "Some Community Development Success Stories." Second, the bill (p. 2, lines 12 and following) states: additional Federal assistance is essential to enable cities to plan, develop, and conduct programs to improve their physical environment, increase their supply of adequate housing for low and moderate-income people, and provide educational and social services vital to health and welfare." The view that more Federal assistance is essential is controverted by the many examples of cities which, on their own, and through both private enterprise and public efforts, are planning, developing, and conducting programs to improve their physical environments, increase their supply of adequate housing, and provide educational and social services vital to health and welfare. The National Chamber's Report on the Community Development Management Seminar conducted in Washington, D.C., on June 9-11, 1965 (which amplifies certain of the examples contained in the aforementioned Success Stories publication), tells both what was done and how it was accomplished. Federal controls and a federally deisgnated czar The bill calls for heavy Federal controls on local actions, and includes provision for Federal designation of a local coordinator-a sort of commissar of czar who would possess vaguely defined powers. At first glance, the bill seems to deal with matters designed and directed by local leaders. It says (p. 3, sec. 4) that, "A comprehensive city demonstration program is a locally prepared and scheduled program But this language can turn out to be quite misleading. Actually, Federal controls spring up in the very next sentence (sec. 4(b)) which puts in the hands of the Secretary of Housing and Urban Development the powers to determine if the local program is big enough, if it is aimed education and social services, and employment and training opportunities, if it has enough local resources, if it has the right kind of administrative machinery, if it is using a relocation plan consistent with the Secretary's regulations, if it is assuming maximum opportunity in housing choices, and if it is meeting such additional requirements as the Secretary may set up. And then the bill (sec. 4(c)) calls on the Federal Secretary to make judgments on local laws and regulations, neighborhood design, technology, community relations and segregation, and comprehensive planning. In section 5 (p. 6), there is provision for the Federal Secretary to make determinations on the adequacy of local administration and on cooperation among local agencies. Clearly, this bill adds up to more Federal control over local affairs. And in section 7, there is indication of how the reins of Federal controls will be held. For this is the section that gives the Federal Secretary the power to designate, for each locality under the program, a Director of an Office of the Federal Coordinator. And so under this bill, the programs become, less and less, matters of local determination, and, more and more, federally controlled and directed. Such a Federal Director operating in a locality could become a virtual czar, for the extent of his powers is only vaguely hinted at in the bill which provides ing of our industry's extreme interest in S. 3116 which has been introduced by Senator Philip A. Hart. The Home Manufacturers Association represents the architectural specification type of home and component manufacturing industry, which in 1965 aecounted for approximately 25 percent of the total single family housing starts. This industry is one of the fastest growing in the general building industry, and conservatively is responsible for home package sales that result in approximately $4.5 billion in new house construction across the country. It is our association's opinion that passage of this legislation would greatly assist many sections of the country, where coincidentally exist side by side depressed and resort areas. S. 3116 would provide mortgage means not currently available, and would as a result enable a much larger segment of the American public to directly and indirectly assist in the economic rehabilitation of such areas. It takes manpower and materials to build houses, and once such units have been established, additional jobs would be created to provide services to their occupants. As you know, home building is one of the greatest contributors to the total U.S. economy, but in recent years because of population cycles as well as other reasons it has not kept pace with the growth of other industries. Any legislation, therefore, which the Congress could enact favoring an increase in the number of annual housing starts could be construed as having a direct beneficial effect on the general economy. Much emphasis has recently been placed on housing in the city, but in all fairness to other segments of the housing industry and the general public it serves, some consideration should be given to those housing markets not presently sharing the benefits of Federal backing. Senator Hart's bill to authorize FHA to in ure mortgages on seasonal housing falls into this category. We therefore wish to officially go on record with you and your Subcommittee on Housing as being in complete accord with the intent and provisions as described by S. 3116. Very truly yours, RALPH C. LESTER, President. NATIONAL FOREST PRODUCTS ASSOCIATION, Hon. JOHN J. SPARKMAN, Chairman, Subcommittee on Housing, DEAR SENATOR SPARKMAN: During its current hearings, your committee will consider legislation introduced by Senator Philip A. Hart, of Michigan, S. 3116, to establish a seasonal housing program within the Federal Housing Adminis tration. Our association strongly urges your commitee and the Congress to approve this measure. The National Forest Products Association, headquartered here in the Nation's Capital, is a federation of 16 regional lumber and wood products organizations operating throughout the United States and Canada. Our industry takes pride in the fact that we rank as the fourth largest employer of manufacturing labor in the United States. Senator Hart's bill would amend section 203 (1) of the National Housing Act to establish within the Federal Housing Administration a mortgage insurance program for housing which is not necessarily intended for occupancy during the entire year. The measure would place a limit of $15,000 on mortgages covering such property, and require it to be "an acceptable risk." Additionally, the Seeretary of the Department of Housing and Urban Development, would be authorized to prescribe standards for such property and structures, including lot size and other pertinent standards, and to issue regulations to assure that the natural setting and scenic values are protected. The forest products industry feels that creation of a seasonal housing program within the Federal Housing Administration would be particularly helpful to the economy of many rural and other nonindustrialized areas of our country. It would supplement current programs of the Departments of Commerce, Interior, and Agriculture that are intended to assist areas of our country which are at economic levels lower than that of the rest of the Nation. Two beneficial But experience teaches that people, ideas, and leadership are far more important. The public must understand, want, and willingly support efforts for improvement. Ideas are constantly needed on newer and better and more efficient ways to solve problems. Leaders are needed to weld the diverse elements of metropolitan areas into cohesive forces for betterment. People, ideas, and leadership are the real keys to greater progress. But S. 2842 fails to recognize these essentials, and instead piles subsidies on top of subsidies to create a system of compound, wholesale subsidies. In practice, it would subsidize subsidies. No objective criteria for selection of demonstration cities-Money to the few at the expense of the many S. 2842 fails to provide city selection criteria which admit of direct and objective measurement. Instead, the bill delivers up to the discretion of the administration the critical decision on who shall get and who shall not get. Instead of providing a yardstick by which all communities may judge and be judged, objectively, the bill gives the Secretary of Housing and Urban Development the power to decide What shall be of "sufficient magnitude"; What is "a substantial increase"; What is "marked progress"; What "will contribute to a well-balanced city"; What is to be included in the "social services necessary"; What are "maximum opportunities"; What are "adequate local resources"; Whether "machinery is available"; What plans meet "the requirements of the regulations"; What is "maximum opportunity in the choice of housing"; and even Anybody, everybody, or nobody could qualify under such requirements, subject to the judgments of the Secretary. Under these circumstances, it seems apparent that a relatively small group of cities is going to get a lot of Federal money, and that the people in the vast majority of the Nation's 18,000 municipalities (and in its 17,142 townships) will not only not get the money, but will be paying the taxes to provide the few with the money. How much Federal money will this small group of cities get? While we have heard that the amount will be on the order of $2.3 billion, no limit (not even such a huge one) is contained in the bill. Instead, S. 2842 provides (in sec. 12 on p. 12): "There are hereby authorized to be appropriated such sums as may be necessary to carry out the provisions of this Act." This vacant stare at costs, in a bill overwhelmingly concerned with putting money into a relatively small number of cities, seems to imply either that the work of determining the costs has not been done or that there is a reluctance to divulge and stand on such determinations. It is important that costs be determined and exposed to full public scrutiny in this important field of city improvement. This view is supported by Presidential efforts to make cost-benefit analyses of Federal programs, with the avowed purpose of more economical conduct of the Federal Establishment. Because S. 2842 is based on questionable assumptions, extends Federal controls, requires use of all available Federal aids (without specific limitations regarding desirability, appropriateness, or priority), treats symptoms instead of causes of problems, dwells on money without recognition of the importance of people and ideas and leadership, provides no objective criteria for city selection, and would benefit the few at the expense of the many, the national chamber urges that the bill be rejected. S. 2977. URBAN DEVELOPMENT ACT Title I of S. 2977 would provide (with respect to certain Federal subsidy programs) extra subsidies in the case of projects which are planned, programed, and coordinated on a "metropolitanwide" basis. In metropolitan areas containing a number of municipal jurisdictions, the projects in one such jurisdiction can have effects, good or bad, in other jurisdictions. Coordinated project activities might produce greater total benefits fected. Experience over the past 17 years has shown that urban renewal must of necessity move slowly if the locality is to prevent the stresses and strains which it occasions from rending asunder its social fabric. The funds actually expended over the past 17 years amount to less than one-third of the $5 billion allocation for urban renewal, at the rate of only some $100 million per year. Since there is no reason to believe that the more ambitious program now contemplated will, in fact, be able to move at a much greater rate of speed, we respectfully recommend that the entire $2.3 billion allocation be made available forthwith, and that additional allocations in future years be made as demand therefor materializes. Also, since the new program will greatly increase the demand for urban renewal funds, if all the Nation's cities which remain outside of the demonstration cities program are not to be shortchanged, it is essential that the $2.9 billion current urban renewal authorization be also fully released without limitation as to fiscal years. A broadening of horizons is essential if the new program is to meet even in part the bold goals set forth in the President's message. In enacting new programs and in extending old programs, it would be most desirable if, in unmistakable terms, Congress indicated its concern with the urgency of the present situation and the need for a corresponding sense of urgency in the administration of all Federal programs. Federal reviews, which are admittedly essential to the sound conception and proper execution of such programs, should, however, be limited only to areas dealing with matters which cannot be safely delegated to local governments. Unnecessarily detailed reviews and complex procedures dealing with secondary minutiae are voracious consumers of the limited manpower available, and detract from the ability of local governments to concentrate on the major problems confronting them and on the maintenance of the momentum of activity which is essential to the realization of their plans. We are living in a time of revolutionary ferment, and the programs under discussion before your subcommittee are centrally involved. There is frequently no recognition of this fact at the regional levels of administration, where localities have to go to resolve their problems. We also wish to go on record as endorsing wholeheartedly the goals of the Urban Development Act, and particularly of those of its provisions under which this Nation will be able to begin to control the endless sprawl of its metropolitan areas and replace it with comprehensively planned, heterogeneous new communities. We appreciate this opportunity of stating our views, and wish to assure you of our future cooperation toward the realization of a proper physical and social environment for our emerging Great Society. Respectfully submitted. GEORGE M. RAYMOND, Chairman, Legislative Committee. INVESTMENT BANKERS ASSOCIATION OF AMERICA, Hon. JOHN J. SPARKMAN, DEAR SENATOR SPARKMAN: The Investment Bankers Association asks that this letter be made a part of the public record of your present hearings on housing. We strongly urge you and the members of the Banking and Currency Committee to amend the college housing program to return the rate of interest charged on those loans from a flat 3 percent, if financing is not available at equally favorable terms, to the formula proviously used which was related to the market. Prices on municipal bonds, as indicated by the Daily Bond Buyer 20-Bond Index, were at 3.07 percent on Jaunary 8, 1965, and by March 4, 1966, they were 3.83 percent, reflecting a steady downward trend in prices with a corresponding increase in yields. The 3.83-percent yield was the highest yield on tax-exempt municipal bonds since 1934. As of April 21, 1966, this average has leveled off to 3.54 percent well above the 3-percent rate of these Federal programs. During 1965 there were substantial losses in underwriting some new issues and carrying inventory against this trend of the market. During 1965 a record total of $11,141,176,000 municipal bonds totaling 6,203 issues were sold. During the 1965 session of Congress the Investment Bankers Association's Municipal Securities Committee opposed amendments to the college housing pro At the same time, however, the national chamber urges that alternative actions be taken to promote city progress. NATIONAL CHAMBER ACTION FOR CITY PROGRESS The national chamber works for the achievement of effective and lasting solutions to city problems. We recognize that some cities are achieving greater success than others in working out their problems. But, we believe that insufficient attention has been given to many different efforts being made, and that there has been insufficient organized dissemination and interchange of ideas which could speed the progress of additional communities. Consequently, the national chamber, first, is taking action to bring together, organize, publicize, and disseminate information on alternate successful approaches currently being used for solving city problems. Areas in which the national chamber is working include steps to 1. Conduct conferences for State, local government, and community leaders at which officials and experts present information and recommendations on ways to modernize local and State government actions for the more efficient solution of urban problems through the exercise of local and State government responsibility. 2. Gather information, from communities throughout the United States, on ways in which urban problems are being solved by the mobilization and utilization of local resources, and publish reports giving detailed information on how the problem-solving action was organized and brought to completion. 3. Provide consulting services to distribute know-how on community development to both private and governmental leaders. Second, the national chamber recognizes the need for systematic and comprehensive work to blaze the trail to newer and more efficient methods for solving city problems and contributing to community progress. On this, we believe that we are already taking the lead through the national chamber's task force on economic growth and opportunity. Task force on economic growth and opportunity As already indicated, the national chamber fully recognizes that improving the quality of urban life is among the most critical of nationwide problems. By opposing S. 2977 we in no way imply the contrary. But, solutions to complex urban problems can be best found through carefuly planned studies and projects involving local talents, resources, and initiative rather than through crash projects predominantly directed by people sitting in Washington, D.C. In accordance with this conviction, the national chamber has invited over 100 chief executives of major American corporations to make serious and independent studies of two of this country's most important domestic socioeconomic problems: poverty and America's cities. This business study group is called the task force on economic growth and opportunity. The chairman is Erwin D. Canham, editor in chief of the Christian Science Monitor. The task force has now served for over a year and a half. During this time it has devoted its entire efforts to the study of poverty, a problem that relates closely to cities. Over 35 leading experts have been commissioned to develop background papers on various aspects of this important problem. Ten panels involving over 100 authorities have met to advise the task force. Six field trips to representative parts of the country have been made to get firsthand information at the local level. The task force itself has researched the subject. Two reports on poverty have been issued to date; several others are in various stages of development. The two reports address themselves to a host of issues, ranging from the definition and measurement of poverty to changes in the Social Security Act. The value of this study is indicated by comments received from private and public leaders who have read the first reports from Bill D. Moyers, Special Assistant to the President, who told the task force that the study was providing "many extremely useful insights into the problems of poverty," to Governor Hughes, of New Jersey, who told the task force that "an effort such as yoursa serious, independent, and extended study of poverty-will be significant in carrying out the war against poverty," to Daniel P. Moynihan, former Assistant Secretary for Policy Planning and Research, U.S. Department of Labor, and now a member of the faculty of Wesleyan University, who recently wrote in an academic journal that the first report "is perhaps the most competent commentary on the Government's antipoverty program yet to appear." |