(The additional information requested follows:)

UNIVERSITY OF DENVER (COLORADO SEMINARY),
COLLEGE OF BUSINESS ADMINISTRATION,
Denver, Colo., April 3, 1954.

Hon. HOMER E. CAPEHART,

Chairman, Committee on Banking and Currency,

United States Senate, Washington, D. C.

DEAR SENATOR CAPEHART: We attach herewith the full statement that we would have made if we had had time to do so last week. I want to express our deep gratitude to you personally for your courtesy in hearing us and for the friendliness of your response to this proposal. Your courtesy to us in view of your other engagements was most heart warming.

Frankly, we believe that if our church or other sponsoring groups can borrow, through a trust, 90 percent of cost, we will have no difficult in carrying out experimentation with this type of housing. We have grave doubts about the wisdom or propriety of asking church or other nonprofit sponsors to risk sums of money in planning a housing program when they cannot know until after they have invested many thousands of dollars in land and plans what FHA will estimate the "value" of a proposed project to be. We trust that you and your committee will be able to work out some resolution of this problem that will not impair in anyway the opportunities we see in the use of the trust corporation under section 213.

Mr. Skrivan joins with me in expressing our very real gratitude to you for the opportunity you have afforded us.

Sincerely yours,

BYRON L. JOHNSON, Associate Professor of Economics. STATEMENT OF BYRON L. JOHNSON, ASSOCIATE PROFESSOR OF ECONOMICS, UNIVERSITY OF DENVER

Mr. Chairman and members of the committee, we appreciate very much the opportunity you have afforded us to discuss briefly this morning a completely new proposal we have been developing to use the trust form of organization in order to build, under section 213 of the Federal Housing Act, housing for the oldest members of such consumer groups as churches, labor unions, lodges, fraternal organizations, and the like.

I am Byron L. Johnson, an associate professor of economics at the University of Denver and I have with me this morning my colleague, Mr. Gene T. Skrivan, chairman of the Department of Building Industry and Real Estate, also of the University of Denver. We have been engaged for more than a year in studying the problems of providing better housing for the senior citizens of our country. There are already 14 million aged persons, that is persons over 65 years of age, and their number is growing at the rate of 400,000 each year. Most of these people desire housing which will preserve their independence and permit them to live their own lives as they see fit. We think it is significant that in 1950 only 3.14 percent of the aged population were in institutions. Tables 1 and 2 show the breakdown of the institutional population among the aged, by sex and age, and by type of institution.

The aged are often left with relatively low incomes because only a small percentage of them are at work; most of them are living on savings or on pensions or on income from members of the family and the like. Because of their income situations they usually cannot afford new, expensive, attractive homes. The attached tables 3 and 4 show the income position of the aged.

TABLE 1.-Number of persons aged 65 and over and number and percent in institutions, by age and sex, 1950

Sources: Bureau of the Census, U. S. Census of Population; 1950, vol. II, Characteristics of the population, pt. 1, U. S. Summary, ch. B, pp. 90, 92, and vol. IV, Special Reports, pt. 2, ch. C, Institutional Population, p. 15. (This table taken from Social Security Bulletin, October 1953, vol. 16, No. 10.)

TABLE 2.-Persons aged 65 and over in institutions, by type of institution, 1950

Source: Bureau of the Census, U. S. Census of Population: 1950, Special Reports, pt. 2, ch. C, Institutional Population, pp. 16-18. (This table taken from Social Security Bulletin, October 1953, vol. 16, No. 10 )

TABLE 3.—Percentage distribution of income in 1949 of nonfarm primary family or primary individual, 65 years of age and over, and under 65 years

Source: U. S. Bureau of Census, Special Tabulation for Division of Housing Research, Housing and Home Finance Agency, July 1951. One-in-a-thousand sample of nonfarm dwelling units. Sample is not suitable for use to secure State or local figures. (This table taken from Facts for Housing the Aging, compiled, for the University of Michigan, Fifth Annual Conference on Aging, July 24-26, 1952, Ann Arbor. Mich.)

TABLE 4.-Numbers and percent of persons 65 years and over receiving income from specified sources (December 1951) 1

1

1 Some persons received income from more than one of the sources listed.

2 Wives of male beneficiaries of programs other than old-age and survivors insurance and railroad retire

ment.

Source: Estimated by Social Security Administration from Bureau of the Census data and reports of agencies administering social insurance and related programs and old-age assistance. Estimates are preliminary. (Table 4 taken from Facts for Housing the Aging, compiled for the University of Michigan, Fifth Annual Conference on Aging, July 24-26, 1952, Ann Arbor, Mich.)

Instead, many of the aged are living in oversized units or in dilapidated units. A special study prepared by the Bureau of the Census in agreement with the Division of Housing Research of the Housing and Home Finance Agency shows that only 66.4 percent of the aged were living in housing in 1950 which had private toilet, bath, and hot running water. (See table 5 from study attached.) By contrast 72 percent of those persons under 65 years of age live in houses having private toilet, bath, and hot running water. Eleven and three-tenths percent of the aged do have private toilets, bath, and cold running water, but most of them live in a dilapidated house. Twelve and eight-tenths percent of the aged had running water but no private toilet or bath, and 8.4 percent did not even have running water available to them.

Not only do the aged live in dilapidated units, but usually they occupy oversize units as well. Fifty-eight percent of the aged live in houses involving five or more rooms although they have smaller families than households headed by persons under age 65. See table 6 attached.

TABLE 5.-Condition of dwelling units-Condition and type of plumbing equipment of all housing in 1950 by heads of family over and under 65 years in nonfarm areas

Source: United States Bureau of the Census, special sample tabulation of 1950 census data prepared under agreement with the Division of Housing Research, Ho sing and Home Finance Agency. (This table taken from Facts for Housing the Aging; compiled for the University of Michigan Fifth Annual Conference on Aging, July 24-26, 1952, Ann Arbor, Mich.)

TABLE 6-Size of dwellings, number of rooms in dwelling units by heads of family over and under 65 years of age in 1950 in nonfarm areas

Source: United States Bureau of the Census, special sample tabulation of 1950 census date prepared under agreement with the Division of Housing Research, Housing and Home Finance Agency. (This table taken f om p. 27 of Facts for Housing the Aging; compiled for The University of Michigan Fifth Annual Conference on Aging, July 24 to 26, 1952, Ann Arbor, Mich.).

The aged often experience a feeling of extreme insecurity, not because of inadequate income but because they live alone. They fear the possibility of a fall or an illness with no one to notice their illness or their failure to appear at meal times. As a result they lead lonely and frustrated lives. Because their families are grown and no longer dependent upon them, they often have a feeling of uselessness as well which makes life hardly worth living for them. They desire companionship; they desire a feeling of being needed; they wish security in a psychological sense just as much as in an economic sense. They want to be housed decently, and yet they want to feel that what they have they are paying for that it is their own. Unhappily for them the market provides practically no opportunity to buy houses. The few that are available are very high cost because of their particular circumstances.

The reason for the lack of housing for the aged in the commercial market is no hard to understand. The aged are relatively questionable as a mortgage risk. Hence there is usually a large down payment required of them, and the only mortgage given them is a relatively short-term mortgage, with resulting high monthly payments. The consequence of all this is that only the well-to-do aged can easily qualify for a new house in the open market.

From the landlord's standpoint, many are doubtful about renting to the aged because they fear the aged may become ill and be unable to pay their bills; or the aged may require expensive medical care. He fears that they may become a very real burden upon him and require more and more of his attention. From the builder's standpoint, the market has been so good for housing for young families for the last 10 to 14 years that he has kept busy building homes on a speculative basis that he could sell directly to young or on contract with the young and middle aged. He has not thought to cultivate the market for housing among the aged. From the standpoint of rental housing, speculative builders have managed to do very well building for the young bachelor person, the young married couple, and the childless couple, and here investors have not thought to cater to this market. The aged are not likely to develop organizations through which they can provide housing for themselves. No case of consumer cooperatives, for example, composed of the aging has ever been called to our attention. The likelihood that older persons will organize a new corporation to build housing for themselves on any general basis is very small.

As noted above, the aged who are dependent are now being housed in mental institutions or in nursing homes or in hospital beds of all manner of descriptions some bad, some good, and some indifferent. We do not believe that we can provide housing for those who are already in this group on any economic basis that the typical aging person who has become dependent can afford. But since 97 percent of the aged still have some form of independence these are the group for whom we are concerned. Some of the independent ones own or rent adequate homes. Some live with members of their families or other relatives, sometimes happily; sometimes not so happily. Some rent and some own homes that are old, too large, and rundown. But many are renting quarters that are not only too expensive but also already slums. In Denver we find that many of them are living in old rundown hotels. Some are residing in institutions, such as nursing homes, that are loaded with chronically ill persons. Such housing is relatively expensive, and may give old-age homes a bad reputation. Furthermore, these homes for the aged are usually old buildings which have been converted to this purpose. We have examined some of the homes in Denver where the aged live, and we find that in many cases the aged are physically prisoners in such institutions. They must climb a half flight of stairs up to the structures from the ground simply to get into the living quarters. Furthermore, in most of these homes they must then climb a full flight of stairs to get to a bathroom or to bedroom facilities. The woman who lives in a house of this sort and who does her own laundry may have to go down a full flight of stairs to a laundry in the basement and then climb a half flight of stairs carrying a heavy wetwash out to the yard to hang it up. For those aged of limited physical strength this type of housing virtually makes them a prisoner in their own home. For those who are living in such homes the only way their independence can be restored is to provide them housing which is suited to their physical condition.

Many of the larger homes that take aged persons in, even though sponsored by charitable or nonprofit groups, tend to become institutions that make "inmates" out of the residents. Some of them require the person to transfer all of his property to the home at the time of his admission. The result is that he no longer controls his own income or property, and he really is not free to leave the institution if his circumstances or his desires change and he wishes to leave. This appears to us to be a way of destroying the independence of the aged. We are anxious to provide housing which avoids this type of financial arrangement.

In my own neighborhood there is a home for the aged which is located literally miles away from the nearest shopping center, theater, church, or any other social organization or any other person who might wish to visit the aged or whom the aged might wish to visit. The only opportunity for aged living in such institutions is to ride in on a private bus or station wagon to the city at hours that match the schedule of the station wagon or bus. Putting the aged out "to farm" on "grassy acres" is not a proper solution. This may be an appropriate treatment for a faithful old horse, but it seems indecent to put our senior citizens out of sight and probably out of mind in a fashion which makes them prisoners of the location of the housing which has been provided. The facilities should not be situated away from friends, families, community ties, and community institutions. They ought to be near or on a transportation line that provides proximity to the library, the church, the lodge hall, and the other institutions which have meant much in the enriching of the lives of the aged persons.

What kind of housing do the aging want? There is an interesting study in contrasts here. We have recently been providing housing which is ideally