1 or 2 or 3 houses on the street are unpainted and unkept and remain so to the obvious discouragement of their neighbors.

Those who have had the opportunity to watch neighborhoods disintegrate will remember that exterior painting is the first thing to be discarded once a neighborhood starts down the path toward slums. If we are to save our neighborhoods from a few penurious owners and a few avaricious landlords, we will follow the forward step of many European cities. They have found the solution in local laws compelling proper maintenance of the exterior of their buildings. Consequently, our second recommendation is as follows:

2. Every city requesting certification will be asked to pass a local ordinance requiring the refinishing of all painted surfaces of the exteriors of all buildings 1 coat no less than once every 5 years unless waived for cause by the city building department.

Every citizen should be held responsible for the condition of the premises on which he lives regardless of whether he is landlord or tenant. Too many cities have ordinances which hold only the property owner responsible for the debris and litter on the premises. To help prevent slums the tenant must and should be held equally responsible. Local city councils back away from passing such ordinances for obvious reasons. Consequently, we have the following recommendation:

3. That every city requesting certification be required to pass an ordinance, if they do not already have one, making the occupants of premises responsible for any debris, rubbish, or litter found on those premises. Full incentive.-We believe that every incentive must be used to encourage the rebuilding of urban renewal areas. Consequently, we are in accordance with the provision of section 220 which increases, as added inducement for such rebuilding, the loans available from the 80 percent of section 207 to 90 percent permitted under this section. For the same reason we think it is a mistake to place any limitation on rents in these structures.

We believe that rents should not be controlled under this section for several reasons. Every incentive must be given the prospective builder to encourage him to build in the renewal area. The profit motive is one of the most important. Rent control itself is wrong in principal and favor the unscrupulous and dishonest operator. In addition we believe that rent control is unnecessary because the area itself will preclude unreasonable rents. We also believe another important incentive would be to permit accelerated depreciation on this construction.

Section 220 (d), paragraph 2, subsection (B) on page 18 of the House bill

Under a liberal construction almost any instrumentality whether it be Federal, State, municipal, or private, whether it be a limited dividend or redevelopment or housing corporations or nonprofit organizations either public, quasi public or private could become organized and start construction under this provision of section 220. It could become another form of public housing. This would make it undesirable, in fact impossible, for private enterprise to compete. If it is the avowed purpose of this bill to have private enterprise carry on the urban renewal program, then this provision (sec. 220 (d), par. 2, subsection B, p. 18) should be deleted.

Section 221: Relocation

RELOCATION

This is the section which provides for the system of relocating families displaced as a result of governmental action in a community which has certified to the Commissioner according to this act. We would like to make the following suggestions:

1. The same limitation be placed on section 221 that was placed on 220. Briefly: The required services of an architect.

2. That this type of financing provided under section 221 be available only in certified renewal areas, for the following reasons:

(a) Under the generous provisions of this section people will be encouraged to rebuild the core of the city. Given an alternative they would obviously pick some other location.

(b) The 95 percent financing provisions for a $7,000 home under section 203 would obviate any great hardship to anyone desiring to leave the renewal area.

(c) This would encourage home ownership in renewal areas which would be a beneficial situation for the entire area.

Section 221, paragraph (d), subsection 3, provides that a nonprofit corporation or association regulated under Federal or State laws, or by political subdivisions of State or agencies thereof, may borrow money for the construction and operation of housing. The preference given public or quasi-public organizations is obvious. The private builder is granted financing of 85 percent of appraised value on individual homes-the public association is granted 100 percent financing of appraised value and up to $5 million in funds. In addition this public organization could build any place at 100 percent financing, while the private builder under section 220 will be restricted to slum renewal areas at 90 percent financing. We object to the inclusion of this provision for several reasons:

1. Because we believe it permits unfair competition with private enterprise. 2. Because it will discourage the entrepreneur from constructing and operating housing in renewal areas.

3. Because the 100 percent financing coupled with a nonprofit organization "regulated or supervised under Federal or State laws" makes this very closely related to public housing. This provision could be used to circumvent limitations placed on the construction of public housing.

This section 221, paragraph (d), subsection 3, should be deleted in its entirety.

PUBLIC HOUSING

We regret that the need for more public housing will not be reviewed this year. It has become more and more apparent that public housing is not being occupied by the indigent or the needy but by people in moderate circumstances who could provide for themselves. The relief client, the pensioner, the public charge is the exception rather than the rule.

Frankly it is impossible to determine just exactly who occupies public housing and the legal right to their being there. Nor are the financial operations available for review. The directors of public housing are reluctant to divulge any information concerning both their tenancy and their operations. Inasmuch as these are quasi-public institutions subsisting on public money, we believe that Congress should make it mandatory for all public housing directors to make available their books for review to responsible organizations.

We believe that public housing should be made available to the people for whom it was meant. All public housing now standing and under construction should be available under priority to:

1. For indigent families supported by relief.

2. Veterans dependent principally on their pensions or disability payments.

3. Any dwellings left over should be available to the lowest economic tenth of the community.

Unless this is provided the existence of public housing cannot be reconciled. When these limitations are adopted we can then determine with comparative accuracy our need for future public housing, if any.

We believe that all Lanham housing should be sold or disposed of as quickly as possible. There is little or no reason for the continuation of Government operation of this type of housing at the present time. Many public housing administrators refuse to relinquish their control of these housing units for private or personal reasons or as a matter of ideology. However, they have served their purpose and their sale will not diminish the amount of housing available for the American public. They should be sold as soon as possible-in any event within the next 12 months.

CONCLUSION

We have discussed the various provisions of the bill concerning rehabilitation, slum elimination, and urban renewal. We believe that this program is practical and that thereby sound civic goals can be achieved. However, as we stated previously, money is not the only tool necessary to insure the success of this program. We need planning and guidance for the borrowers to insure actual improvement to their homes. Occupans must be held responsible for the exterior housekeeping of their premises. We must recognize that responsibility for exterior maintenance must be mandatory upon the owner if we are to prevent future slums.

We do not believe that the present generous provisions for the financing of homes should be increased at this time. We are maintaining a very high rate of construction. Any overproduction would be deflationary, thereby wiping out the slim equities of the very homeowners created by this bill.

At the beginning of our testimony we suggested that we would limit our consideration of the housing bill to its possible impact on our existing housing inventory. I use the word inventory purposely in the hope that it will remind us of our superabundant inventory in other products. These inventory problems are tremendous-and they are rising every day-not only in farm products but in so many commodities such as autos, steel, etc.

If there is any purpose for my being here it is in the hope that I have shown you that housing can stand just so much of the hypodermic needle before it too can be overbuilt. In fact, I hope I have shown you that the overproduction of butter is child's play compared to the overproduction of housing. Butter spoils in a relatively short time—but it takes years to work off an overbuilt housing situation.

I hope I have shown you that in considering this bill we are deciding not so much the future of the housing to be built as the future of the 43 million nonfarm housing units now on hand. And if, at this critical stage, we are to become concerned, let us also be concerned with the 30 or more million homeowners who have had the courage and thrift to save for their homes as well as with the few who haven't.

Under this bill we believe we may increase the construction of housing abnormally. We maintain such abnormal stimulation is the most dangerous thing possible to our economy. We are debasing the biggest asset owned by the majority of our people their home. We are endangering its value, its desirability, and the financial standing of all homeowners.

This bill, unless substantially modified, offers a sure method for deliberately creating overbuilding, overfinancing, abnormal rise in private debt, and, as the end result, a financial depression caused by inability of the borrowers to meet their mortgage obligations. Basic housing is now available to everyone at very small effort through modest savings. Little more can be asked or should be granted.

Statistics

Vacant_

MARRIED COUPLES IN OWN HOUSEHOLDS

Increase, married couples_

Increase housing units_.

Persons 3.7

23.3

26, 600,000 35,000,000

8,400,000 12, 700,000

NUMBER OF VACANT DWELLING UNITS IF HOUSING USED AS IN 1940

Vacancy factor__

1 Census, p. 20, No. 41; Census, HC-8, No. 1.

2 Census, p. 20, No. 41.

6, 500, 000 units.

13 + percent.

The CHAIRMAN. Since we can't finish this morning, I think we might as well recess until 2:30-I was going to say if anyone has just a short statement that they could handle in about 3 or 4 minutes, we might take them now.

Mr. MITCHELL. It might take 5 minutes.

The CHAIRMAN. All right. Mr. Mitchell for the National Association for the Advancement of Colored People.

STATEMENT OF CLARENCE MITCHELL, NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE

Mr. MITCHELL. I have one chart I would like to put up, and refer to it, after I summarize my testimony.

Mr. Chairman and gentlemen of the committee, I am Clarence. Mitchell, director of the Washington Bureau of the National Association for the Advancement of Colored People.

I have my prepared statement which I would like to submit for the record.

The CHAIRMAN. Without objection, your statement, as prepared, will be inserted in the record. I don't think we can put that chart in, can we?

Mr. MITCHELL. We have an attachment.

The CHAIRMAN. We will place that chart in the record, too, at the end of your remarks.

Mr. MITCHELL. I want to call the committee's attention to the first part of our statement where, in the third paragraph of page 1, we offer an amendment to the basic housing legislation.

We ask that "The aids and powers made available under the several titles of this act are not to be conditioned or limited in any way on account of race, religion, or national origin of builders, lenders, renters, buyers, or families to be benefited."

We have pointed out in our statement, that it is our firm conviction that if the present housing laws were properly administered, there would be no need for this amendment. The problem is that the housing agencies have studiously ignored their responsibilities. They have not had the courage to adopt such programs and policies as would eliminate the discrimination that exists under the present housing legislation.

We have said in our statement here that the policies which are followed by the housing agencies would not in any sense embarrass the present Malan government of South Africa, which is a prosegregation government. Curiously enough there is in this morning's New York Times a statement about the Malan government of South Africa embarking upon a program of clearing Negroes out of the slums areas over there, and apparently they will do it in about the same principle followed in this country; namely, that government money is used for the purpose of clearing colored people out of areas where they now live, reducing the land available to them, and all with the assistance of tax-supported aid of one kind or another.

Now, we want to call the committee's attention specifically to Savannah, Ga., where we have an area which is a place where a great many colored people have lived for years, and that area has been cleared out.

Right in the middle of it there is a wonderful and enormous new housing development with grass plots, trees, playgrounds, and whatnot, for whites only, and all around it, of course, are these shacks, unpaved streets, slum areas, where the colored people are forced to live.

I would like to offer if I may, Mr. Chairman, for the record, a request that we submitted to the housing agencies way back in 1952, asking them if they would change these policies, and they have to date

The CHAIRMAN. Without objection, that will be made a part of the record.

(The information follows:)

STATEMENT ON HOUSING SUBMITTED TO MR. RAYMOND M. FOLEY, ADMINISTRATOR OF THE HOUSING AND HOME FINANCE AGENCY

There has been a steady and dangerous trend in the application of racial policies by the housing agencies of the Federal Government since the United States Supreme Court decided the restrictive covenant cases in May of 1948. When the Court made that decision, it opened the door for colored homeseekers to purchase and use property in any neighborhood where there is a willing seller. This has resulted in a steady expansion of the colored population out of the racial ghetto into nonsegregated housing areas in communities such as Los Angeles, Calif.; Cleveland, Ohio; Washington, D. C.; and Richmond, Va. The chief threat now to this progress in eliminating Negro ghettos comes from the Federal Government itself through the operations of the Housing and Home Finance Agency and its constituent agencies.

Under the slum clearance and urban redevelopment program, colored residents of some areas that will be cleared are being forced to move out while white persons will be the only racial group admitted to the new rental or sales housing to be erected on the cleared site.

The number one illustration of this incredible type of discrimination, with the assistance of the Federal Government, is Baltimore, Md., where there are two areas designated for redevelopment-one known as the Waverly project and the other in the vicinity of the Johns Hopkins Hospital.

In several cities, public-housing projects will be built in areas where colored people have lived for many years but when the new projects are completed they will be designated for white occupancy.

The most critical example of this is Savannah, Ga. In this community, a number of colored families will be moved from what is known as the Old Fort area. We are advised that, because the site selected for the housing project in Savannah is of historical interest, city officials have decided that the project must be for whites only.

Under the FHA program, the city of Washington is ringed with new developments for white persons only. We are informed by builders that there are ironclad agreements between FHA and various lending institutions under which new housing areas must be designated for a specific racial group. Hence, in the areas surrounding Washington, practically all of the FHA-insured developments are for whites only. This is the typical pattern of FHA operations in the North and West in the South, FHA operations generally reinforce patterns of residential segregation.

The defense housing program will, undoubtedly, follow the same pattern of segregation now in effect under the other housing operations. The policy set forth in the Administrator's letter to Congressman Abraham J. Multer, dated November 26, 1951, clearly permits continued segregation.

During the debate on the defense housing bill in the first session of the 82d Congress, Congressman Multer stated that he had been advised by FHA that questions pertaining to segregation in housing aided by the Federal Government had been taken care of by administrative regulation. At that same time, the FHA through its general counsel, Mr. B. C. Bovard, said the following:

"I know nothing in the National Housing Act or in rules and regulations thereunder which would authorize the (FHA) Commissioner to require that mortgagors disregard racial considerations in the selection of their tenants. This would appear to be a matter for determination by the mortgagor and not by this Administration."