We could not do this and still regard ourselves as part of the city in which we must work. We could not continue to act as a housing resource for all low-income families displaced by renewal or highways who need our help. Many of our poorest families have come to us as displacees. We could not, in conscience, do this, for where would the very poor go?

In the past four years, we have housed 1.649 families displaced by public action. Of that number, 49 percent had incomes under $3,000 a year, 60 percent had $3,600 a year or less. A full 80 percent of those families, many of them large families had incomes of $4,800 or less.

Beyond public housing in Boston and other cities are the poor I spoke of earlier, the tenants of private owners. Very many of them are living in substandard housing. Very many are paying too much of their incomes for rent. Another measure currently being suggested to improve our financial condition is to improve the tenant's sense of responsibility for his development and thus decrease our cost of repair and maintenance.

I believe there is an implication here that the Authority will make available to families, troubled by afflictions commonly associated with poverty, the many services they need. We agree that much more should be expended for tenant services and that, in the long run, these expenditures would mean a saving in our maintenance expenditures. But, in the meantime, where are we to get the funds?

I will say that the vast majority of our tenants are deeply concerned about the condition of the developments. These developments, after all, are their homes. Tenants in Boston have spent thousands of volunteer hours organizing and encouraging each other in their efforts to improve the developments. We now have tenant committees in each of our management areas elected by vote of the tenants and we have a citywide corporate organization of tenant volunteers composed of delegates from the local committees, an organization which helps to keep us on our toes and which is ready to cooperate in any task which might improve the homes of the tenants.

A continuing dialogue with these tenant organizations across the entire spectrum of Authority operations is well advanced. A pre-eviction hearing board with majority tenant membership has been established. Tenants have membership in a newly-created transfer review board. The Authority has recently adopted a revised lease, prepared jointly by tenants and staff. We are expending our efforts to provide maximum employment opportunities to tenants in management and maintenance positions with the Authority.

We look forward to increasing involvement and participation of tenants in the management process.

In one of our larger developments, Bromley-Heath, housing almost 1200 households with a median income of about $2500, a tenant organization is taking part in an experiment in tenant management.

Recently, phase one of this experiment was completed and it has been recommended that a tenant corporation be formed to contract with the Authority for management of the development.

We are very hopeful about this experiment. Already, we believe we can sense an improvement with the organizing work of the committee, a certain enthusiasm starting to build among the tenants. We believe we can detect a rising feeling of community and a decrease in vandalism.

Decreasing vandalism is important to us and to our tenants. Our figures on the extent of vandalism in our developments are uncertain. It is often difficult to make a distinction between vandalism and the extraordinary wear and tear caused by large numbers of children. It's difficult to know whether a window was broken by a baseball or a rock.

But we do know that vandalism is prevalent, that its costs are high and that it is associated with social problems. We believe that the remedy for vandalism lies in attacking the root causes of family disorganization and the lack of community feeling in our developments, that is, in attacking the underlying social causes of vandalism. But this, again, costs money.

Another measure currently being suggested is to improve our management techniques. We have been doing this and we are making continual progress. Let me mention here a few of the measures we have introduced at the Boston Housing Authority just in the past year.

First, however, let me say that all of our efforts to reverse past trends, to turn the program around so to speak, would not have been possible except for the three most recent appointments to the Authority Board of Commissioners. This

new majority, which includes two tenants, has brought to the Authority a new confidence and hope among tenants. New policy goals and objectives are being set and the staff has a clear and firm charge to implement these policies.

The Authority contracted with an engineering firm for a thorough study of its maintenance operations. The firm's report contains valuable suggestions for reorganization and we are at the stage now of implementing those recommendations. The staff of the Authority has studied the information flow within the agency and we have completely overhauled reporting systems, increasing the accruacy, speed and amounts of data available to us.

We are now developing a proposal for a greatly increased use of data processing. The reporting of vacancies has been computerized and we expect in the near future to include purchasing, rent rolls, and other calculations.

All our purchases are now being coded for the computer. We are preparing for a comprehensive analysis of 1969 purchases. We are developing a purchasing catalogue to consolidate purchases, to develop minimum and maximum inventories and the like.

Overtime expenditures in the past eight months have been cut to about half the rate of previous years. This has been accomplished despite the introduction of emergency night and week-end service for our tenants.

In addition, we have established a quota system for management personnel to set minimum standards of performance. We have pulled back painting crews from our developments and sent them out from our central office in teams. The result has been a 20 percent increase in productivity.

We have instituted training programs for all levels of our employees, ranging from management seminars to Spanish classes. We have become more strict. The number of disciplinary actions has increased about eight times over previous years.

We have found, however, that the net immediate result of our efforts to become more efficient is increased cost.

It takes money to hire skilled staff, to train personnel, to reorganize management structures, to introduce computerization. Our efforts now to increase efficiency will pay off in the future. For the present, we must pay the cost-often a heavy cost-of improving.

So, we return again to the beginning of this statement, our financial difficulty, and to a question which underlies this whole discussion and the debate in the nation today. What are we to do about the poor in our society? More specifically, what are we to do about their undisputed need for housing and for the tenant services that should be associated with housing? For housing is more than buildings. It is an integral part of the social environment in which people live and it both affects and is affected by that environment. Three is a relation between the money we neglect to spend for tenant services and the money we have to spend because of vandalism. Given that premise, how can we administer a public housing program adequately without adequate resources for tenant services?

To summarize, we have done our best to solve our financial problems. We have gone about as far as we can go without undermining the essential reasons for the existence of public housing. But, Mr. Chairman, we are treading water. Where are we to turn?

I submit that we must turn now to the Congress. Congress must make clear to the Department of Housing and Urban Development that it meant to supply ade quate resources to local housing authorities with the passage of the Brooke and Sparkman Amendments of 1969. It must make clear that these resources must be adequate enough to allow us to operate programs that can provide decent, safe, and sanitary housing for the very poorest in our cities. For all of these reasons, we strongly support the 1970 Bill (S. 4086) introduced by Senators Brooke, of adequate federal assistance in these matters.

In view of the repeated declarations of concern by the Congress and in view of the 1969 housing legislation, I feel confident that the Congress will respond, that it will stand with us in keeping faith with the promise of public housing in our cities.

Thank you.

EXHIBIT I

QUESTIONS ASKED BY NAHRO OF 17 LARGE HOUSING AUTHORITIES ON CURRENT FISCAL SITUATION, JUNE, 1970

1. What is the impact of inflation on the cost of operating your LHA over the last few years?

2. What is the demand and need for housing in your community on the part of very low-income families, particiularly those displaced?

3. What is the immediate possibility of having a cross-section of income occupancy, to achieve higher rents, and solve financial problems?

4. To what degree have you had to postpone ordinary maintenance over the last few years, due to lack of funds; how serious is this?

5. To what extent have economies and reforms in management been undertaken by your LHA? What is your appraisal of management reform as an answer to financial needs?

6. What is the extent of vandalism and tenant destruction of property? What is the prospect for reduction if the LHA had a limited tenant services staff to help involve tenants in management responsibility?

1 For Boston's response to these 6 questions see NAHRO general testimony for the statement by Daniel Finn, Executive Director of the Boston Housing Authority, page 960.

CHICAGO HOUSING AUTHORITY

(Number of Units in Management: 39,962)

1. Impact of Inflation.-Within the last few years operating costs related to salaries and wages have increased 35%. Operating supplies, materials and services have increased from 10% to 65%. Rentals have been adjusted several times to keep pace with rising costs. The current average rental is approximately $69 per month which is inadequate to meet operating expenses. Chicago Housing Authority has had to resort to complete utilization of operating reserves to avoid more rent increases. Within the near future one of the following methods will have to be employed to meet the present crisis: (1) increase rents up to $10 per month; (2) reduce services or defer major maintenance programs; or (3) receive additional subsidy from HUD.

48-279-70-pt. 2- 4

2. Demand for Housing.-There is a great need for public housing at the present time. This is demonstrated by the size of CHA's present waiting list: 14,000 senior citizens; 8,000 families with children.

3. Cross-Section of Income.-CHA houses families according to date of application which results in a cross-section of income within the present limits. A "flat rent system" is employed and a policy change aimed at increasing the number of higher income families would not amount to a substantial increase in rental income.

4. Deferred Maintenance.-In 1969 and 1970 CHA was forced to refer major maintenance items, to the sum of $2,000,000, because of lack of funds. Deferred maintenance results in greater costs at subsequent dates because of worsening conditions and the inflationary trend in the cost of wages and materials.

5. Management Reform.-Management reform has been fully implemented to comply with the requirements for assistance of the Modernization Program. Every effort has been made to operate the low-rent program in the most efficient manner possible.

6. Vandalism and Tenant Responsibility.-Vandalism is a serious problem which costs the Authority hundreds of thousands of dollars annually. The needs of the low-income family and the nature of the problems involved have changed significantly in recent years. Today, public housing is occupied principally by families new to urban areas who find difficulty in adjusting to urban living. CHA for the last 15 years has worked closely with residents in a conserted effort to solve these social problems and has sought the services of every public and private welfare agency in the city which could offer the residents needed services. To reduce and ultimately eliminate the problem of vandalism and other serious social problems, emphasis has been placed on the organization of resident councils and the involvement of these groups in the problems of management arising from tenant behavior problems. Some improvement has been noted, however, the problem is far from being solved. Presently, 25 tenants have been employed as community representatives to help in the evaluation of reasons behind destructive behaviour patterns and to help in the establishment of a spirit of cooperation. There is a great need for further federal subsidies in this area to expand and continue the present program.

COLUMBUS METROPOLITAN HOUSING AUTHORITY

(Number of Units in Management: 6,141)

1. Impact of Inflation.—The impact of inflation on the operating costs over the last five years has been so great as to be well-nigh disastrous financially. Costs of such essential items as door locks, window glass, ranges, janitorial supplies have burgeoned anywhere from 10% to 55%. The maintenance crew and management staff are stretched thin to provide essential services without increasing personnel costs. The Authority takes advantage of every program possible to supplement its personnel; for example, this summer 135 young people from Neighborhood Youth Corps are, under proper supervision, doing the extra yard and cleanup work that summer brings. But this is only a stop-gap, not a solution.

2. Demand for Housing.-There are 4,129 active, eligible applications at the present time, principally from very low-income families. Approximately one-fifth of the applicants are elderly. Less than 2% of the applicants are displaced families. The housing applications reflect only the local demand, not the need. Because of the long waiting period, many applicants become discouraged and fail to renew their applications. Only emergency cases can be housed at the present time.

3. Cross-Section of Income.-There is little immediate possibility of having a cross-section of income occupancy to achieve higher rents. Not only are the majority of our applicants lower-income, but also families with higher income, when housed, tend to move on quickly to other housing, thus making our turnover greater among the higher income residents.

4. Deferred Maintenance.-For the past two years all ordinary maintenance has been reduced and all extra-ordinary maintenance eliminated from our budgets. This would have meant a serious breakdown in our operation had it not been for the Modernization funds we received.

5. Management Reform.—To effect economies in our management practices we have undertaken a number of reforms in our methods of operation. We have started data processing and already our payrolls and accounts receivable are computerized with the eventual goal of all records and reports on the sys

tem. A systematic preventive maintenance program is cutting down on emergency service calls while keeping our property in better condition. Many of our residents, informed and instructed through resident councils and scattered site housing workshops, do as much of their own maintenance work as is practical or safe. Though these actions stem the financial drain to some extent, they are by no means the answer. The only answer, to our mind, is an adidtional contribution from the Department of Housing and Urban Development for the additional operating and maintenance services that can no longer be provided for under the present rigid subsidy formula.

6. Vandalism and Tenant Responsibility.—Vandalism and destruction of property play a small but vital part in the over-all maintenance problem, and contribute to our financial woes. However, our relationship with our residents, especially through resident councils, is good, and could be improved with the proper tenant services staff to encourage continual active tenant involvement in management responsibility. Even the younger residents are assuming civic responsibility. Teenagers at one development have formed a "Teenagers Patrol" to hold down youthful damage and litter. This type of program could be extended to all developments, and others of similar nature established to reduce or eliminate vandalism and property damage.

KANSAS CITY HOUSING AUTHORITY

(Number of Units in Management: 2,506)

1. Impact of Inflation.-Inflation is the principal cause of the present financial crisis. The average wage increase for maintenance employees has been nearly 100% from $4,186 in 1964 to $7,461 in 1969. The Authority's income, however, has only increased 20% in the same period. This has resulted in an overall reduction of maintenance personnel: from 73 in 1964 to 60 in 1969. Material costs have risen 30% while contract costs have increased 50%. Administration costs are up only 30% in spite of the addition of 9 tenant Services personnel to meet the social goals requirements or HUD for the Modernization Program. 2. Demand for Housing.-Did not answer.

3. Cross-Secton of Income.-Theoretically, a cross-section of income in occupancy would be beneficial, however, it has little practical applicability. The majority of higher income families can and do find housing elsewhere, paying in most cases beyond their means to avoid the stigma of living in a readily identifiable public housing project with extremely low-income families. During the past 6-7 years, the national economy has been in a period of unparalleled proserity, and many of the upwardly-mobile tenants have moved into private housing; leaving public housing with an increasingly low-income residency. Currently 70% of the tenant population are the recipients of welfare and it becomes difficult to attract higher income families.

4. Deferred Maintenance.-Many preventative maintenance programs have been held in abeyance and deferred in order to produce residual receipts. The effects of deferred maintenance, or "catch-up" maintenance, have caused the KCHA to dip heavily into reserves. The current Modernization Program will force utilization of reserves well below the 50% level.

5. Management Reform.-HUD advice and directives have been followed in regard to the reform of management. The adoption of policies and leases in concert with the tenant associations and the use of machines to release people to do personal contact and tenant services work have not resulted in a financial benefit for the authority.

6. Vandalism and Tenant Responsibility.-Although vandalism has occurred from time to time in all of the projects, it has been most prevalent in the single high-rise family project. Until 1966, vandalism was not a serious problem but new social unrest in the community has been a contributing factor to the increase in vandalism.

HOUSING AUTHORITY OF THE COUNTY OF KING (SEATTLE)

(Number of Units in Management: 1,914)

1. Impact of Inflation.-The impact of inflation over the past five years has resulted in an increase in routine operating costs of 18.4%. The corresponding increase in rent from tenants has been 10.5%.