Previous attempts to stimulate home production through market guarantees were a complete failure and we predict the same result for any program that attempts to push unacceptable and unproven houses off on the American public. Prefabricators who have had the foresight to study public demand are making satisfactory progress. They need the continued and increased support of FHA, a better public understanding and in some cases sound financial assistance. Their efforts and the progress of this new industry will be immeasurably set back by the continued Government financial support of extravagant housing experiments by companies inexperienced in the production, financing and sales of homes to the American public. (The following communications and statements were received for inclusion in the record:) CONGRESS OF THE UNITED STATES, Hon. BRENT SPENCE, Chairman, Banking and Currency Committee, House of Representatives, Washington, D. C. DEAR COLLEAGUE: I am enclosing the letter which I have received from Mayor Eugene I. Van Antwerp of Detroit, Mich., on the public housing situation in the city of Detroit, under date of April 4, 1949. It will be appreciated by me if you will have this letter embodied in the printed hearings on this subject before your committee. With kind personal regards and best wishes, I subscribe myself, JOHN D. DINGELL. CITY OF DETROIT, EXECUTIVE OFFICE, Congressman JOHN D. DINGELL, Detroit, Mich., April 4, 1949. House Office Building, Washington, D. C. DEAR CONGRESSMAN DINGELL: Detroit is the Public Housing Administration's operating lessee for 5,200 units of temporary, Lanham Act housing. Built to last 5 years, some of the better units just made it. Others, particularly the "mobile" (trailer-type) units, have succumbed to Detroit's rigorous climate and today represent merely substandard shelter for 565 families desperately in need of adequate housing. In the operation of these 5,200 units, the Detroit Housing Commission has insisted, where possible, on maintaining the dwellings in reasonable repair. "Peeling" gypsum siding has been economically and attractively covered with cement-asbestos board, leaking roofs have been retarred, and collapsing stoops and coal bins replaced. The cardboard "mobiles", however, defy our maintenance ingenuity and we confine our efforts to holding them together in the hope that we may soon have a house to offer these families. The Lanham Act's January 1950 deadline hanging over these 5,200 families can be extended and it must be; but the devastating effects of time and occupancy on these makeshift dwellings must also be ameliorated by substantial maintenance expenditures lest the buildings collapse and defeat the extending legislative action. We in Detroit know that even the early passage of public housing legislation will not produce a program to permit demolishing these "temporaries" in less than 3 or 4 years, and have only to look at our thousands of applications, and our monthly turn-over figure of less than 1 percent, to know that although ready for demolition these units must be held together. The Public Housing Administration, with understandable pride, has reported the deposit in the United States Treasury of huge sums representing the net income of these units throughout the country. We hope they now realize this bonanza could continue only through maintenance policies that would make frightful slums of these projects and destroy the self-respect of these "homeless" tenants. With the public's reluctance to distinguish between "temporary" and "permanent low-rent" housing, such a policy would forever destroy the local authority's standing in the community as a slum clearance agency. The units have outlived their usefulness as dwellings and should be scrapped, like the $1,000 bomb sights on sale in war-surplus outlets for $2. But unlike the bomb sights, this war product is still desperately needed and it is costing an increasingly greater amount to keep even as substandard shelter. Detroit enjoys the dubious distinction of being the Nation's largest operator of substandard public housing. Detroit has more at stake than any other large city in seeing the problem satisfactorily resolved. We strongly urge that these steps be taken promptly: 1. Further extension of the January 1, 1950, deadline for the removal of Lanham Act housing, with authorization to local authorities to deprogram the most seriously dilapidated units as soon as possible. 2. Approval by the PHA of more generous maintenance budgets for war housing projects. 3. The addition of a provision in the new public housing law providing increased allocation of new permanent public housing authorization to cities faced with the problem of deprograming a substantial amount of temporary war housing. 4. Permission from the PHA to transfer tenants from temporary war and veterans housing to permanent public housing where family income exceeds the present continued occupancy limits by less than 20 percent. 5. Authorization to permit the Public Housing Commissioner to grant cities such as Detroit, which have a preponderance of temporary public housing, permission to use a limited number of vacancies in such housing as temporary shelter for non veteran low-income families who need to be relocated temporarily from slum-clearance sites approved for public housing or other redevelopment purposes. These steps are urgently needed if our cities are to eliminate their "public housing slums" with the least amount of hardship to the families affected. Would you be kind enough to convey these thoughts of ours to the appropriate committee of Congress which is considering the problem of temporary war and veteran housing disposition. Also, we would like to be kept informed as to the progress of such legislation so that representatives of Detroit may be heard at committee hearings. Sincerely, EUGENE I. VAN ANTWERP, Mayor. THE UNITED STATES CONFERENCE OF MAYORS, Hon. BRENT SPENCE, House Office Building, Washington, D. C. DEAR MR. CHAIRMAN: It would be appreciated if you would put the attached communication in the record of the hearings now being held on H. R. 5631—the housing bill you have introduced. The New York City Housing Authority has been serving as adviser to the United States Conference of Mayors in its analysis of the bill. You will note that the report of General Farrell, chairman of the New York City Housing Authority, is that with regard to the disposition provisions the bill in its present form is satisfactory from the standpoint of the local agencies affected thereby. With best personal wishes, I am Faithfully yours, PAUL V. BETTERS, Executive Director. NEW YORK CITY HOUSING AUTHORITY, Re H. R. 5631, omnibus housing bill Mr. PAUL V. BETTERS, Executive Director, United States Conference of Mayors, Washington, D. C. DEAR MR. BETTERS: Thank you for your letter of July 13, 1949, with which you transmitted copy of H. R. 5631, the administration omnibus housing bill. With regard to the disposition of temporary and war housing, the bill in its present form appears satisfactory to this authority. Sincerely yours, T. F. FARRELL, Chairman. DISABLED AMERICAN VETERANS, The Honorable BRENT SPENCE, Chairman of the House Committee on Banking and Currency, House of Representatives, Washington, D. C. DEAR CONGRESSMAN: Please find enclosed herewith a statement on behalf of the Disabled American Veterans in support of H. R. 5631. We would appreciate very much to have this statement incorporated in the record of the hearings now being conducted by your committee. Thanking you for your continued interest in the cause of the home-seeking veterans, I am, Very sincerely yours, CHARLES E. FOSTER, Assistant Director for National Legislation. STATEMENT OF CHARLES E. FOSTER, ASSISTANT DIRECTOR FOR NATIONAL LEGISLATION, DISABLED AMERICAN VETERANS Mr. Chairman and members of the Committee on Banking and Currency: on behalf of the Disabled American Veterans, I appear in support of H. R. 5631, a bill to amend the National Housing Act, as amended. Our support of this bill stems from a national convention mandate adopted at our last national convention which reads as follows: "Be it resolved, That the National Legislation Department be authorized to support legislation that will provide adequate rental units for disabled veterans at rents commensurate with the average income of such veteran; and Provided further, That the National Legislative Department be authorized to support legislation that will provide decent, fairly priced family housing units for sale to disabled veterans at a cost within the average income bracket of such disabled veterans." We feel that H. R. 5631 will accomplish the general purposes encompassed in the above resolution. The "Cooperative Housing Insurance" provision of the bill will furnish that necessary stimulus to veterans in organizing cooperatives for the construction of rental and for-sale housing units. The requirements in this section that the mortgagee must certify that such units conform with minimum construction standards will tend to overcome many of the complaints and faults that have arisen in the recent past. Title IV of H. R. 5631 seeks to amend section 501 of Public Law 346 of the Seventy-eighth Congress, the so-called GI bill of rights by increasing the amount of the guarantee to 60 percent of the loan but not to exceed $7,500. The DAV endorses this amendment but believes the committee should give consideration to making its provisions retroactive. At the present time several million veterans have exhausted their loan guaranty benefits under the GI bill and it seems only just and equitable that those veterans who took advantage of their loan guaranty benefits at an early date should not be prejudiced by future congressional action. As the members of this committee know, once a veteran has used his loan guaranty benefit, he is not entitled to a second loan. However, if the provisions of title IV are made retroactive, it would provide those veterans who have already used their loan guaranty, an additional $3,500 guaranty in the event he finds it necessary to refinance his home, or for reasons beyond his control, is compelled to move his family to a new locality and purchase another home. The DAV is particularly pleased with the provisions of section 512 of H. R. 5631 authorizing "supplementary direct loan to veterans." We have been quite concerned in recent months with the growing propaganda of certain groups in the country to force the interest rate on GI loans to 41⁄2 percent. We feel that this section of the bill will forestall these selfish groups in their efforts to obtain a 42-percent interest rate on GI loans. In closing, the DAV urges the members of this committee to give favorable consideration to H. R. 5631, to supplement the "Housing Act of 1949," by providing homes for the middle and lower-middle income groups. We urge each and every member to vote for H. R. 5631 as a measure necessary to complete legislation in the housing field. Hon. BRENT SPENCE, NATIONAL COUNCIL OF NEGRO WOMEN, INC., Chairman, House Banking and Currency Committee, United States House of Representatives, Washington 25, D. C. DEAR CONGRESSMAN SPENCE: The National Council of Negro Women heartily welcomes an opportunity to commend your committee for the extensive study and vigorous action which culminated in enactment of the Housing Act of 1949. This, together with your expeditious move to consider H. R. 5631, should result in the comprehensive housing program for which all of us have striven so long. Through such an accomplishment, American citizens for generations to come will find in every community residential monuments to the Eighty-first Congress of the United States. The council is confident that the Congress that has supported the declaration of national housing policy in the Housing Act of 1949 will rapidly fill in the middleincome gap, now existing as the only major deficiency in our otherwise comprehensive Federal housing legislative program. For only through provisions to meet the needs of this income sector can we achieve our national goal of "a decent home and a suitable living environment for every American family." Fortified with this conviction, we have reviewed the housing amendments of 1949 to the conclusion that its provisions would appear to be most helfpul in contributing to solution of the difficult housing problems which so persistently confront racial minority groups. Basic measures generally enabling middle-income families so achieve decent homes within their financial means are essential to racial minority groups. According to the 1947 census data on distribution of family and individual incomes, less than 10 percent of the nonwhite population in the United States falls into income ranges in excess of $4,000. It would follow that the bulk of racial minorities must be served by low-rent and middle-income housing programs. Under present conditions, the highest hope for literally millions of these families is to have access to cooperative or other types of nonprofit housing in order to gain a reasonable degree of balance between public and private families to meet their total housing needs. This is dramatically illustrated by the many instances in which Negro families, who have improved their living standards through occupancy in public housing and have also increased their earning capacity as more useful and productive citizens of the community, become ineligible for low-rent housing but cannot find standard housing open to them. As earnestly as we have advocated an adequate public program have we also sought aids for standard housing at suitable costs to enable families to be graduated out of the low-rent program as soon as they become ineligible. These provisions are essentially complementary. Among the specific provisions of the proposed amendments, we are most concerned about the authorization for direct loans for nonprofit and cooperative housing for which private investment funds are not available. These provisions, indeed, meet a crucial need among racial minority groups. In order to refreshen your memory with respect to this vital question of financing, we are attaching a table showing racial comparative data on first mortgage holders as reflected in analyses of 1940 census data. You will observe: (1) Commercial banks, savings banks, life insurance companies, and mortgage companies hold a much smaller proportion of first mortgages for nonwhite occupants than for the total of mortgagees. (2) The highest proportion, almost one-third, of the mortgages for nonwhite occupants are held by the individual mortgagors who charge the highest interest rate-6.52. (3) Only for mortgages held by an agency of the Federal Government-the HOLC-is the interest rate the same as between the nonwhite mortgagors and the total. (4) In all other cases, the interest rates are higher. Clearly, you will see from these data that the nonwhite group, with the lowest economic capacity, has the greatest difficulty in securing mortgage credit in the first place, and pays most for it when it is available. Moreover, the council has been repeatedly advised by real estate operators that racial minority group home purchasers typically carry the high cost burden of second mortgages while such junior financing is generally considered to be obsolete. We cannot overemphasize the urgency and necessity of governmental direct loans which will either make mortgage financing on equal terms and conditions available to racial minorities or will encourage competing private financing resources to provide funds on this basis. Our sole criticism of the amendments in this respect is that they would limit the direct loans only to cooperative and nonprofit housing. Actually, this recourse should be available under any circumstances where economically and structurally sound housing is obstructed solely because credit is withhold on discriminatory grounds. We would urge your committee to take this serious deficiency into consideration. It is essential to afford racial minorities a truly equal opportunity to improve their housing conditions. Beyond this point of emphasis, we would indicate only that the amendments appear to be eminently sound and potentially invaluable in meeting the urgent housing needs of the millions of families now neglected in housing's no-man's-land. We would appreciate your placing this letter of our endorsement in the record of the hearings before your committee. Sincerely yours, MARY MCLEOD BETHUNE, Founder-President. Average value, average interest rate, and holder of first mortgage on 1-family nonfarm owner-occupied property, by race of occupant, for the United States, 1940 Source: Adapted from Sixteenth Census of the United States, 1940: Housing, vol. IV, Mortgages on Owner-Occupied Nonfarm Homes, table A-4 (p. 9), table A-10 (p. 13), and table A-13 (p. 17). NATIONAL ASSOCIATION OF HOUSING MANUFACTURERS, Hon. BRENT SPENCE, House Office Building, Washington, D. C. MY DEAR MR. SPENCE: The Banking and Currency Committee has given much attention to the problem of reducing housing costs. Last year, a notable study of this subject was completed by a Senate Subcommittee on the High Cost of Housing. Its conclusions included recommendations to reduce housing costs by stimulating mass production of housing through the use of industrial techniques which have proven successful in other manufacturing fields, and have given Âmerica industrial leadership throughout the world. Congress accepted these recommendations of the Subcommittee on the High Cost of Housing and included section 102 in the Housing Act of 1948 which authorized RFC to make loans for the mass production of housing through either factory production or large-scale on-site operations. Several loans have been made under this authorization and a number of producers have expanded their operations to achieve lower housing costs. However, as was pointed out by Mr. Raymond Foley, Administrator of the Housing and Home Finance Agency, a major obstacle has arisen in the achievement of lowering housing costs through mass production. That obstacle is the difficulties and delays in obtaining ade |