FEDERAL WORKS AGENCY

UNITED STATES HOUSING AUTHORITY

INTEROFFICE MEMORANDUM

DECEMBER 27, 1940.

To: All regional directors.

From: W. P. Seaver, Assistant Administrator. Subject: Management policies to be established for United States Housing Authority aided defense housing projects under Public, 671.

This memorandum sets forth management policies that have been established by the Administrator for United States Housing Authority aided defense housing projects under Public, 671.

Prior to approval of loan contracts for United States Housing Authority aided defense projects, it will be the function of the regional management adviser, in collaboration with the Management Division, to review the suitability of the project for nondefense purposes including the proposed nondefense rents, income limits, and subsidy.

I. PERIOD FOR DEFENSE HOUSING

The management program resolution will contain a statement that the resolution applies only during the period when the President determines that in any locality there is an acute need for housing to assure the availability of dwellings for persons engaged in national-defense activities.

II. INCOME LIMITS

1. Income limits for admission.-A. A sufficient number of income grades shall be set up to serve the market as defined below.

B. With respect to Army and Navy noncommissioned personnel, income limits are to be established at the top income of the personnel recommended to be rehoused by the officer in charge of the Army or Navy post served by the project.

C. With respect to Army and Navy civilian employees, the principles set forth in B above shall apply.

D. With respect to privately employed industrial workers, the top limit shall not be higher than the median income of the workers who are coming into the community to meet the personnel needs of the majority defense industries. 2. Income limits for continued occupancy.-If income increases above the top of any grade, the family shall go into the next grade. The income limit for continued occupancy shall not exceed 120 percent of the top limit of the top grade.

III. RENTS

1. Rents must be set to serve the group for which the project is intended. The Defense Housing Coordinator suggests the following guide in setting shelter rents:

"For noncommissioned officers of the first three grades in the Army the amount which is allowed them for commutation of quarters; for enlisted per sonnel of the Navy shelter rents shall be approximately 17 percent of income; for civilian employees of the Army, Navy, or defense industries living in family dwelling units shelter rents shall be approximately 20 percent of income.”

In general, the statutory rental value should be not less than one-fifth of the income; where State laws so require this is mandatory.

2. Rents are to produce at least sufficient revenue to meet all expenses including 59-year debt service and 10-year RMR. Operating estimates are to be figured conservatively, not predicated upon unusual tenant maintenance.

3. Any surplus revenue produced as a result of 1 and 2 above shall be used to amortize bonds of latest maturity.

IV. ALLOCATION OF DWELLING UNITS

When grades and appropriate rents have been established for United States Housing Authority aided defense projects and dwelling units are allocated to

The Coordinator, in collaboration with the Federal housing agencies, prepares a locality management program which contains the statements of rent levels and policies of tenant selection to be used in the particular locality concerned. Attention is called to the fact that the management of Army and Navy projects is handled somewhat differently than those of defense industry because of basic differences in factors of employment. Considerations in these instances are usually guided by the regulations of the Army and Navy. If the projects are managed by agencies other than the Army and Navy, these agencies are governed by priorities issued by the Army and Navy. Usually occupancy is given to a family after certification by the service.

Decisions regarding rent levels, tenant selection, and other basic factors are supported by information contained in the locality files which covers, among other things, the major defense employers' estimates of the scope of their defense activities as measured either by the volume of contracts or the number of workers engaged or about to be engaged in defense work, and the wage scales to prevail for those to be housed.

You will also be interested in those factors which enter into the selection of tenants. For the sake of brevity, I shall list these briefly and expand any point, if the committee cares to have me do so.

1. Consideration is given to the number of industries in the locality engaged in defense activities in order that the total number of houses may be appropriately divided among the employees of the various defense activities.

2. Priority is given to applicants who have come from other localities, whose domiciles are beyond reasonable commuting distance of the defense industry in which they are engaged. This category also includes applicants who have come from other localities and who are now living locally with their families in temporary quarters, including trailers and official Farm Security Administration trailer parks; or doubled up with another family; or desiring to bring their families from their domiciles elsewhere.

3. If a sufficient number of applications are not received from the above classification, applicants domiciled within reasonable commuting distance of the defense industry or in the locality are considered according to their relative housing need. The local manager is given discretionary authority to waive the above priority of selection in unusual individual instances where the applicant's occupation or skill is vital to the local defense program, or other vital considerations make such waiver essential to the defense program.

In conclusion, and to point up the answer to your question, the total effect of the above considerations is to house first those nonresident workers who have migrated to the scene of defense activity from another locality or who are housed beyond reasonable commuting distance from their employment.

TESTIMONY OF CARL HENRY MONSEES

Mr. THOMAS. It appears now, from your statement, that the defense program emphasizes the fact that people who come into a community for employment and do not have a house are to be preferred.

Would that same preference also apply to a nonresident who is not a defense worker, if he does not have house?

Mr. MONSEES. The answer is no, if you are talking of publicly financed defense-housing projects. Of course, our responsibility is broader and encompasses the entire housing problem in areas of defense activity. While nonresidents who are not defense workers would not have preference in Government defense-housing projects, we would attempt to provide for them through organization of homes registration offices to make fullest use of existing housing facilities and through encouragement of private effort both in reconditioning of existing structures and in new construction where feasible.

Mr. THOMAS. But there is no present program for taking care of all residents?

Mr. MONSEES. Under our program an attempt is made to meet the housing need of all defense workers, but should we miss in our