Mr. ADDONIZIO. Thank you, Mr. Adair.

Before we proceed with any questions I think it would be well to hear from Mr. Whatley.

Mr. WHATLEY. Mr. Chairman and gentlemen, my name is Brown L. Whatley, and I am chairman of the board of Stockton, Whately, Davin & Co., Jacksonville, Fla. That is a mortgage loan and insurance company. I, too, appreciate the opportunity of appearing here this morning and discussing with you the need for a more practical and effective approach by FHA to insuring loans on housing for the elderly and also I am interested in another section of the act which I would like to refer to and that is nursing home mortgages. In Florida we have a real need for these facilities and the FHA program was designed to provide these needed buildings, but it has not been effective for certain reasons which I want to try to point out to you. The Housing Act of 1961 is a most liberal expansion of purely public housing and mortgage insurance on housing in which public or semipublic bodies are sponsors and those who believe that private enterprise should be encouraged to do as much of this job as possible in the housing field, I think, would agree that every effort should be made in the proposed new legislation to permit and encourage private enterprise to do as much of the job as possible, leaving less of the load to be borne by public and semipublic subsidy as might otherwise be the case.

Nonpublic sponsorships under the section 231 program have been greatly handicapped by reason of the statutory mortgage limitation of $9,000 per dwelling unit. This differs from the other sections of the act insofar as rental housing is concerned because it fixes the ceiling, the limit definitely at $9,000 for each family unit whereas the others provide additional amounts where the apartments or family dwelling units are larger than the minimum. It is quite apparent that this section was drawn with the idea in the beginning that the greatest demand on the part of the elderly would be for minimum size or what we call efficiency apartments, but the actual experience of builder developers and the FHA mortgage lenders will bear out my feeling and belief that the need is for apartments of medium size, not minimum, and not luxury type.

Mr. BARRETT. May I ask a question?

Mr. WHATLEY. Yes, sir.

Mr. BARRETT. Do you think the $9,000 limit is too low?

Mr. WHATLEY. Yes, sir, except for minimum size, efficiency apartments.

Mr. BARRETT. What do you think about $11,000?

Mr. WHATLEY. Well, of course, I think $11,000 would be much better than $9,000 but the other sections provide for additions on a per room basis as rooms are added. For instance in 207 when you have four or more rooms, you get an additional $2,500 loan limitation for each roomette and it is my feeling that something like that ought to be done for housing for the elderly.

Just follow the same sort of pattern as you now have in 207 and 213. It just shackles the program to the point where the only thing you can provide in the way of housing for the elderly in multiple-unit buildings is small efficiency apartments and the record shows pretty well, I think, that the small efficiency apartments won't supply the need and I think our experience with the 608 program where there

was a limitation of $8,100 per family unit demonstrated that the planning of such buildings is forced into small units, forced into a volume of small units which is not marketable and the need for larger or medium sized units is simply not answered. The written statement which I have submitted and which I would like to submit to you for the record carries a suggested amendment that follows pretty well, tracks pretty well the language under section 207. It simply provides for $2,500 additional for rooms in excess of efficiency-sized apartments which according to the FHA's present method of room counting would be two and half rooms and that is the figure that is used in this proposed amendment. There is appended also to the statement which I ask be made a part of the record, a schedule showing the difference in the amounts of various size apartments as they now are limited and what would be the amount that would be in effect if the amendment is adopted. It simply makes the program workable. Now, I would like to mention a survey that was recently conducted in St. Petersburg, Fla., for the purpose of determining the requirements of the elderly people in that area for housing of this type. This survey was conducted by Mr. Stan Freifeld and his associates.

He is here this morning in the room. He is head of a firm that has done quite a bit of homebuilding in that area and has now plans for some projects for the elederly which are quite excellent projects. He conducted this survey in order to determine how to plan these buildings, what the people wanted. Among other things it contains information as to the size of apartments desired, the number of rooms, the number of persons in the family and their ages, the number of automobiles they own, the monthly amount available for the payment of rent. He made a careful study of these inquiries, this information, and discussed it in personal interviews with these prospective tenants and the plans for their buildings have been completed along the lines dictated by the survey. Twenty percent of the 200 living units in one building are efficiency apartments-only 20 percent. Sixty-two percent are one-bedroom units and 18 percent are two-bedroom units.

When the plans for this building were completed in February of this year an advertisement was inserted in the same local paper describing the proposed apartments in detail and soliciting reservations. From this single advertisement responses were received from 361 prospective tenants. In addition to Florida, the St. Petersburg newspaper drew inquiries also from 18 other States and the District of Columbia. Only 23 percent of these requested efficiency apartments, while 58 percent asked for one-bedroom units and 19 percent wanted two-bedroom units.

As a result of one insertion of this advertisement reservation deposits have now been made for 114 apartments and the actual reservations for the apartments of various sizes very closely compares in percentage to the preferences previously determined by the survey with 27 percent for efficiencies, 52 percent for one bedroom units and 23 percent for two bedroom units. Complete and detailed tabulations on this very enlightening survey, with copies of the advertisement used are available to the members of your committee and your staff. FHA's section 608 under which a great many apartment buildings were built had a statutory maximum amount limitation of $8,100 per family unit. As a result, the tendency of most builders was to