That any such acquisition of real property shall not deprive the State or any political subdivision thereof of its civil or criminal jurisdiction in and over such property or impair the civil rights under State or local laws of the inhabitants on such property;

(4) Enter into agreements, with respect to any real property acquired and held under this Act, to pay annual sums in lieu of taxes to the State or local taxing authority, and such sums shall approximate the taxes which would be paid upon such property to the State or local taxing authority, as the case may be, if such property were not exempt from taxation;

(5) Sell or exchange at public or private sale, or lease, real or personal property, and sell or exchange any securities or obligations, upon such terms as he may fix;

(6) Obtain insurance against loss in connection with property and other assets held;

(7) Subject to the specific limitations in this Act, consent to the modification, with respect to rate of interest, time of payment of any installment of principal or interest, security, or any other term, of any contract or agreement to which he is a party or which has been transferred to him pursuant to this Act;

(8) Include in any contract or instrument made pursuant to this Act such other covenants, conditions, or provisions as he may deem necessary to assure that the purposes of this Act will be achieved; and

(9) Make such rules and regulations as he deems necessary or desirable to carry out the purposes of this Act.

(b) Section 3709 of the Revised Statutes shall not apply to any contract for hazard insurance, or to any purchase or contract for services or supplies on account of any property acquired pursuant to this Act if the amount of such purchase or contract does not exceed $1,000.

(c) In computing family income for the purposes of this Act (1) there shall be deducted amounts paid by the United States Government for death or disability in connection with military service and (2) for each member of the family less than 21 years of age (other than the head of the family and his spouse) there shall be deducted $200 or his annual income, whichever is the greater.

(d) To assist in achieving the purposes of this Act, the Administrator is authorized to furnish technical advice and assistance in the organization of nonprofit housing corporations of the character described in section 11 (a) hereof, and in the planning, development, construction, acquisition, and operation and management of their housing projects;

(e) In the administration of this Act, the Administrator shall take such steps as he deems necessary and desirable to assure that the benefits of the nonprofit character of any borrower hereunder are not dissipated through speculative devices and shall require that, under such terms and conditions as he shall prescribe, major contracts in connection with the development of the housing project shall be fixed-price contracts awarded after public advertisement or other adequate publicity as to the call for bids therefor.

(f) Any person who induces or influences a borrower hereunder to purchase or acquire property or to enter into any contract, in connection with any housing project to be financed with a loan made under this Act, and wilfully fails to disclose any interest, legal or equitable, which he has in such property or such contract, or any special benefit which he expects to receive as a result of such contract, shall be fined not more than $5,000, or imprisoned for not more than one year, or both;

PROTECTION OF LABOR STANDARDS

SEC. 9. In order to protect labor standards—

(a) Any contract for financial aid pursuant to this Act shall contain a provision requiring that not less than the salaries prevailing in the locality as determined or adopted (subsequent to a determination under applicable State or local law) by the Administrator, shall be paid to all architects, technical engineers, draftsmen, and technicians employed in the development, and to all maintenance laborers and mechanics employed in the administration of the housing project involved, and shall also contain a provision requiring that not less than the wages prevailing in the locality, as predetermined by the Secretary of Labor pursuant to the Davis-Bacon Act (49 Stat. 1011) shall be paid to all laborers and mechanics employed in the development of the housing project involved; and the Administrator shall require certification as to compliance with the provisions of this paragraph prior to making any payment under such contract;

(b) The provisions of section 874 of title 18, United States Code and section 2 of the Act of June 13, 1934, shall apply to any housing project financed in whole or in part with funds made available pursuant to this Act;

(c) Any contractor engaged on any housing project financed in whole or in part with funds made available pursuant to this Act shall report monthly to the Secretary of Labor, and shall cause all subcontractors to report in like manner, within five days after the close of each month and on forms to be furnished by the United States Department of Labor, as to the number of persons on their respective pay rolls on the particular housing project, the aggregate amount of such pay rolls, the total man-hours worked, and itemized expenditures for materials. Any such contractor shall furnish to the Department of Labor the names and addresses of all subcontractors on the work at the earliest date practicable.

VETERANS' PREFERENCE

SEC. 10. Every contract made pursuant to this Act for a loan for a housing project shall require that in the selection of tenants for, or members entitled to occupy, dwellings in such housing project preference shall be given, as among eligible applicants for occupancy of dwellings of given sizes and at specified rents, to families of veterans and servicemen (including families of deceased veterans and servicemen), and that as among applicants entitled to the preference provided in this section, first preference shall be given to families of disabled veterans whose disability has been determined by the Veterans' Administration to be service-connected, and second preference shall be given to families of deceased veterans and servicemen whose death has been determined by the Veterans' Administration to be service-connected: Provided, That nothing in this or any other Act shall preclude a nonprofit cooperative ownership housing corporation the permanent occupancy of the dwellings of which is restricted to the members of such corporation, from accepting, without regard to the preference provided in this section, nonveteran members of such corporation as initial occupants of dwellings in the housing project. For the purposes of this section the term "veteran" shall mean a person who has served in the active military or naval service of the United States at any time on or after September 16, 1940, and prior to July 26, 1947, and who shall have been discharged or released therefrom under conditions other than dishonorable. The term "serviceman" shall mean a person in the active military or naval service of the United States who has served therein on or after September 16, 1940, and prior to July 26, 1947.

DEFINITIONS

SEC. 11. The following terms shall have the meanings, respectively, ascribed to them below, and, unless the context clearly indicates otherwise, shall include the plural as well as the singular number:

(a) "Eligible borrower" or "borrower" shall mean (1) any private nonprofit cooperative ownership housing corporation the permanent occupancy of the dwellings of which is restricted to the members of such corporation, or (2) any private nonprofit corporation authorized to provide dwellings (i) the occupancy of which is to be permitted in consideration of agreed charges, or (ii) for sale to a corporation of the character described in clause (1) of this subsection.

(b) "Housing project" shall mean a project (including all property, real and personal, contracts, rights, and choses in action acquired, owned, or held by a borrower in connection therewith) of a borrower designed and used primarily for the purpose of providing dwellings: Provided, That nothing in this Act shall be construed as prohibiting the inclusion in a housing project of such stores, offices, or other commercial facilities, recreational or community facilities, or other nondwelling facilities as the Administrator shall determine to be necessary or desirable appurtenances to such housing project.

(c) "Development cost" shall mean (1) the amount of the reasonable costs, as approved by the Administrator, incurred by the borrower in and necessary for, carrying out all works and undertakings for the development of a housing project and shall include the cost of all necessary surveys, plans and specifications, architectural, engineering, or other special services, land acquisition, site, preparation, construction, and equipment; administrative expenses and carrying charges (including interest) incurred during the development of the housing project up to and including the occupancy date (as defined by the Administrator); initial working capital for the administration of the housing project; necessary expenses (including any initial operating deficit, as defined by the Administrator) in connection with

the initial occupancy of the housing project; and the cost of such other items as the Administrator shall determine to be necessary for the development and financing of the housing project, or (2) the cost, as approved by the Administrator, incurred by the borrower in, and necessary for, the acquisition of a housing project developed with a loan made under this Act.

(d) "Gross income" for any project fiscal year shall mean the total rents and revenues and other income derived from, or in connection with, the housing project during such project fiscal year.

(e) "Minimum interest payment" for any project fiscal year shall mean an amount equal to 2 per centum on the average balance of the loan outstanding during such operating year.

(f) "Operating expenses" for any project fiscal year shall mean the amounts, as approved by the Administrator, necessary to meet the reasonable and proper costs of, and to provide for, operating and maintaining the housing project, and to establish and maintain reasonable and proper reserves for repairs, maintenance, and replacements, and other necessary reserves, and shall include amortization and the minimum interest payment on the loan made hereunder, necessary expenses for real estate taxes, special assessments, administrative expenses, and insurance charges, together with such other expenses as the Administrator shall determine to be necessary for the proper operation and maintenance of the housing project.

(g) State" includes the several States, the District of Columbia, and the Territories, dependencies, and possessions of the United States.

(h) "Rent" shall mean the monthly charges, to the members, in the case of a borrower of the character described in clause (1) of section 11 (a) hereof, or to the tenants, in the case of a borrower of the character described in clause (2) of section 11 (a) hereof, in consideration of which occupancy of a dwelling in a housing project is permitted by the borrower.

(i) "Administrator" means the Housing and Home Finance Administrator

ACT CONTROLLING

SEC. 12. Insofar as the provisions of any other law are inconsistent with the provisions of this Act, the provisions of this Act shall be controlling.

SEPARABILITY

SEC. 13. Except as may be otherwise expressly provided in this Act, all powers and authorities conferred by this Act shall be cumulative and additional to and not in derogation of any powers and authorities otherwise existing. Notwithstanding any other evidences of the intention of Congress, it is hereby declared to be the controlling intent of Congress that if any provisions of this Act, or the application thereof to any person or circumstances. shall be adjudged by any court of competent jurisdiction to be invalid, such judgment shall not affect, impair or invalidate the remainder of this Act or its applications to other persons and circumstances, but shall be confined in its operation to the provisions of this Act or the application thereof to the persons and circumstances directly involved in the controversy in which such judgment shall have been rendered.

The CHAIRMAN. The committee will adjourn to reconvene tomorrow morning at 10 o'clock.

(Whereupon, at 4:15 p. m., the committee adjourned, to reconvene on Thursday, July 28, 1949, at 10 a. m.)

HOUSING AMENDMENTS OF 1949

THURSDAY, JULY 28, 1949

HOUSE OF REPRESENTATIVES,

COMMITTEE ON BANKING AND CURRENCY,

Washington, D. C.

The committee met, pursuant to adjournment, at 10 a. m., the Honorable Brent Spence (chairman) presiding.

Present: Messrs. Spence, Brown, Patman, Monroney, Buchanan, Deane, McKinnon, Kunkel, Talle, McMillen, Cole, and Nicholson. The CHAIRMAN. The committee will come to order and we will resume the hearing on H. R. 5631.

Congressman Lind, of Pennsylvania, desires to make a statement. STATEMENT OF HON. JAMES F. LIND, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF PENNSYLVANIA

Mr. LIND. Mr. Chairman, I have a brief statement that I would like to read and I ask unanimous consent that a letter I have, addressed to me by the attorneys representing a group of veterans in the city of New York, and also 600 tenants of property surrounding this area, be included as part of the record.

The CHAIRMAN. That may be done. You may proceed.

(The letter above referred to is as follows:)

Hon. JAMES F. LIND,

Old House Office Building, Washington, D. C.

JULY 26, 1949.

SIR: It has come to our attention that Senator Sparkman has introduced a bill in the Senate known as S. 2246, wherein under section 606 of said bill the Housing Administrator will be specifically authorized to convey war-housing projects of the Federal Government to local public housing authorities for use as low-rent housing projects.

For your information, War Housing Project No. P. A. 36295 is located in York, Pa., and known as Yorktown Homes, and is included in said bill.

This office has been retained by two groups of people who are definitely opposed to acquisition of this project by the York Housing Authority for the purposes above stated.

The first group is composed of 112 veteran residents of this project, for whom we are in the process of forming a nonprofit corporation for the purpose of enabling said veterans through said corporation to secure title to their homes in the project aforesaid. It might be added that it is the intention of the veteran members to admit into membership of the corporation a sufficient number of nonveteran residents of the project so as to enable the said corporation to purchase the entire project which consists of 220 units.

The passage of this bill as it now reads would defeat the purposes for which we are forming the aforesaid corporation, and would deprive the veterans of the right to purchase their homes. In addition to such right, these veterans would also face ultimate eviction because they are all in a salary group higher than that which would be acceptable to qualify a family for low-rental housing.

The second group consists of 600 property owners in the vicinity of the aforesaid housing project, who are thoroughly convinced that the acquisition of said