portion to the population of their election districts or jurisdictions, but consisting of not more than 15 persons. The major of the central city of the metropolitan area or the chairman of the county township or parish commissioners of the largest county township or parish in the metropolitan area, should be appointed chairman of the committee. The governor of the State or States within which the metropolitan area lies should appoint one representative each on such committee. The director should be required to present to the committee for its review and comment any proposed policy affecting the distribution of Federal aids for housing or local public works.

On the establishment of any official metropolitan planning agency, the director should be required to present any proposed policy to the governing board of such agency for its review and comment prior to the adoption of such policy.

4. Aids to local public works: The provision of an eventual $48 million revolving funds of planned public works as provided in H. R. 5827 seems to us a step in the right direction. The need for advanced planning of public works necessary to support housing and community development has long been recognized nationally and locally. The present program of advance planning is obviously much too small. Experience has shown that public-works projects cannot be put into action in a short period of time. The average time between enactment and employment on the site has been approximately 3 years. This period could be considerably reduced, and substantial savings to local governments could be achieved by the following recommendations:

(a) The authorization and appropriation of loans to local agencies for advance planning should be increased by $20 million in the first year and by such an additional amount as is necessary in each succeeding year until the total planned program consists of $20 billion in local public-works projects or programs at the end of a 5-year period.

(b) The Secretary of Housing should be authorized to guarantee the bonds of local public agencies used for the acquisition of sites for local community facilities well in advance of actual need. For this purpose, it is recommended that the Secretary may guarantee up to $1 billion in local bonds.

(c) The existing program of loans to communities for local public works such as sewer and waterworks should be increased to $1 billion. (d) We recommend that there be authorized and appropriated $1 billion per year for a 10-year period for scholarships for graduate training of professional city planning and housing technicians.

5. Slum clearance, urban development, and renewal: The program of urban redevelopment authorized by the Housing Act of 1949 has, in our opinion, become a fully accepted, although still experimental, part of the programs of Federal and local governments. H. R. 5827 would increase present authorizations. While we recognize that the Federal program has been modified to include rehabilitation and conservation activities which have been developed by several cities, we feel that further and more fundamental modifications in the Federal-aid systems are required to meet needs which are fully recognized in many communities, but which have not commanded national attention vet. These include placing redevelopment on a continuing program rather than a project basis; changes in the grant-in-aid formula; authority

to acquire areas gradually over long periods of time; expansion of the program, and changes to meet the still unsolved problems of relocation.

In the interest of time, may I submit at this point our more detailed recommendations to be included in the record as attachment 2.

6. Special housing problems: There are a number of special housing problems that should be included in any comprehensive housing legislation.

In discussing public housing for the aging, I have made specific recommendations which we believe essential. We feel also that the field of consumer cooperative housing offers a genuine opportunity to make substantial advances in adding to the supply of homes for our senior citizens. We urge that the tools we have recommended be made available to these people.

While we recognize that in the provision of homes for the aging, certain elements of design should be stressed, we urge that the tools we have recommended be made available to these people.

While we recognize that in the provision of homes for the aging certain elements of design should be stressed, we urge these citizens not to be segregated as a special problem to be housed in the projects of their own but rather that they be absorbed as part of the total community. That will permit them to live in normal neighborhoods where many kinds of employment opportunities will be open to them. It will permit them to continue to occupy an important place in community life.

We are a long way from finding an adequate solution to the housing problems that face members of minority groups. The public housing program has been geared to the needs of all eligible families.

On the other hand, it is true that in the field of private housing receiving benefits through Federal guaranties and other aids, minority families have been almost totally neglected. They are unable to secure either land or adequate financing on any kind of an equal basis. Very little regard has been given even to their minimum housing needs. A substantial percentage of families presently living in areas marked for demolition through slum clearance and urban renewal, fall within middle and upper income brackets. They live in slums because no other shelter is available to them because of their race or color. If the needs of those families are not met, and if the private housing aids made possible by our Government are not made to apply to these families, the redevelopment program will fail, and an unforgiveable injustice perpetrated. They ask for no special privilege, they ask only to be permitted to bargain for homes in a free market. That is an appeal to which our Government can no longer turn its back.

It is recognized, Mr. Chairman, that the challenge of bringing the Nation's farm housing up to standard involves many problems peculiar to our farm and rural economy. To accomplish a farm housing program commensurate with that recommended for urban housing would require that at least 40,000 substandard farm homes be replaced each year. In our opinion, the most effective program devised to date was included in title V of the Housing Act of 1949. It is our belief that this program should be reactivated along the lines of the farm housing bill which has been introduced in this session by Senator

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Sparkman and Representatives Albert Rains and Robert E. Jones, Jr. Our only suggestion would be that the size of the program be spelled out in definitive terms, instead of leaving the determination almost entirely to the whims of the Committee on Appropriations.

We recommend also that the Federal Housing Administration be authorized to insure the buyer of homes against loss or replacement on new products or novel methods of construction. This insurance should be available at no cost to any 10 percent of FHA's insurance volume and to any product or method approved by any recognized testing laboratory as practicable, and sponsored by any experienced builder.

Always, we conclude by urging an increased and effective housing research program. We suggest that the Housing Administrator should be authorized to draw upon any reserves or authorizations of the FHA, the Federal Home Loan Bank Board, the Public Housing Administration, or the Federal National Mortgage Association, in proportion to their total participation in Federal housing activity, to finance any needed housing research, and in an amount not to exceed $2 million per year. An additional $2 million per year should be authorized to be appropriated to the Administrator for research.

In addition, we have some specific recommendations concerning liberalization of conventional mortgage credit aids through FHA, the Home Loan Bank system, and FNMA. The actions suggested would, in our opinion, assist additional families in the upper middle income group who are presently unable to take full advantage of existing programs. These recommendations I submit for the record as attachment III.

I thank you again for this opportunity to appear today. (The material referred to by Mr. Robbins is as follows:)

Attachment I

RECOMMENDATIONS OF THE NATIONAL HOUSING CONFERENCE ON HOUSING FOR FAMILIES OF MIDDLE INCOME

1. There shall be established a mortgage bank for cooperative and middleincome housing.

This bank shall be authorized to make loans to housing cooperatives for 40 years, with the interest rate at the cost of money to the Government plus 1⁄2 percent. The terms on such loans should be comparable to those described in S. 2246, the housing bill of 1950. They include loans of up to 95 percent of the cost of construction with requirements that cooperatives purchase shares in the cooperative bank as added security for the loans.

2. The bank shall be authorized to make loans to private nonprofit legal entities on similar terms where such corporations agree to provide housing for families of moderate income and to give preference in the following order, with preference to veterans in each category: (1) To families displaced by public action; (2) to families living in substandard housing; and (3) to families living in overcrowded housing.

3. The bank shall also be authorized to make similar loans (40-year terms; interest rate at the cost of money to the Government plus 2 percent to individual purchasers of homes, subject to the following conditions:

(a) That such loans shall be available only on homes in developments which are being built with conventional FHA mortgage insurance and such loans shall not be available to more than 50 percent of the homes in any development being built by any builder under any single FHA mortgage insurance commitment.

(b) The favorable interest rates are to be made available with preference to families in the following order: (1) To families displaced by public clearance or enforcement action; (2) to families living in substandard homes; and (3) to families living in overcrowded homes. Veterans shall have preference in each category.

(c) The normal stable income of the purchasing family to be ascertained by the lending institution making the conventional loans on the project by means of the customary credit report.

(d) Eligible families are to be those with incomes that preclude them from purchasing or renting conventionally financed new housing with total monthly housing expenditures of 20 percent of their stable normal family income as defined by FHA.

(e) Down payments of 5 percent shall be required of all families except those certified by a local public agency as being displaced. In such cases the home is to be sold under a lease-option plan with title transferred upon accumulation of a 5 percent down payment from rent payments.

(f) Builders would be required to make a 5 percent price concession on units sold under these liberal credit terms which involve practically no selling costs. (g) Credit at an interest rate of cost of money to the Government plus 2 percent, would run with the family, not with the house. The mortgage lender shall be authorized to convert the mortgage to a conventional FHA insured mortgage in the event of resale by the borrower. In the event of default, the mortgage lender shall be authorized to repossess and resell the home upon the original terms to another eligible family.

(h) The bank shall issue mortgage loan commitments, at an interest rate of cost of money to the Government plus 2 percent, only on such homes as it determines to be the best quality home available at the lowest price for each type of housing and in each submarket area currently proposed to be built in the locality involved.

(i) Mortgagees making loans under this program shall agree to service the loan at a 2 percent servicing fee.

4. The Administrator of the Housing and Home Finance Agency shall estimate the need for middle income housing in each housing market area of the country and shall allocate to each area its appropriate share of the loans authorized under this act. In making such allocations, the Administrator shall be required to reserve funds for loans to projects serving displaced families, families requiring rental accommodations and minority group families, in accordance with the respective needs of such groups. All loans made and commitments issued under this program shall be made pursuant to such allocations and subsequent reallocations of loan authority.

5. The bank may enter into contract with any FHA approved mortgagee to service loans and may enter into commitments to purchase or repurchase loans during the life of a loan or to participate in a loan made by such institution. 6. For the purposes of cooperative, rental and sales housing under this middle income section, $3 billion a year in mortgage loans should be authorized.

Attachment II

RECOMMENDATIONS OF THE NATIONAL HOUSING CONFERENCE OF SLUM CLEARANCE, URBAN DEVELOPMENT, AND RENEWAL

1. The Division of Slum Clearance and Urban Redevolpment of HHFA should be authorized to provide up to 90 percent of local expenditures for planning rehabilitation and conservation activities and for redevelopment planning on an annual basis. Annual expenditures from Federal and local sources would be allocated on a pro rata basis to any projects subsequently financed in accordance with the existing two-thirds-to-one-third matching basis.

(The Federal-aid formula does not recognize that urban renewal is a continuing process. Even rehabilitation and conservation efforts, which must go on for an indefinite period of years are now financed upon a project basis, upon the presumption that when the project is completed, no further action will be needed. Federal advances for planning, for enforcement and rehabilitation, and for conservation should be budgeted and advanced on an annual basis for a continuing program of activities at the local level.)

2. The financial formula for urban redevelopment projects under title I of the Housing Act of 1949 must be modified to require that local expenditures authorized as a part of the project plan shall not be required to exceed one-third of total expenditures required to complete the redevelopment plan. This change is also essential if local governments are to finance their share of a program whose size is more than an experiment.

(The present financial formula requires local agencies to provide one-third of net project cost and the Federal Government to provide two-thirds of net cost.

In actual practice, however, local agencies are often required to provide local public improvements or public works which are not credited as part of project cost. As a consequence, actual local expenditures often exceed total Federal expenditures many times. In one current project, for instance, local expenditures of $5 million will be required to obtain Federal aid of $22 million.)

3. Acquisition of areas to be cleared should be permitted over a period of years. (Areas now have to be acquired, cleared, and rebuilt with all practicable dispatch. This inevitably means a disruptive and inhumane treatment of residents, small-business men, property owners, and social and religious institutions. It inevitably means higher costs, greater resistance and political tensions. A more orderly, humane, and economical policy would permit localities to acquire sites over a period of years, acquiring properties as they come on the market, demolishing structures as they are vacated, moving families and small-business men as vacancies permit. Rebuilding also might take place to a greater extent over a period of time.)

4. The capital grant authorization under title I of the Housing Act of 1949 should be increased by $1 billion.

(The present Federal program is not clearing slums as rapidly as slums are being created. If slums are to be reduced the program must be more than doubled, and planning must be undertaken now for projects which will go into acquisition 5 years hence as integral parts of a citywide program.)

5. Existing law and administrative regulations require comprehensive plans for relocation of population as a condition for Federal financial aid. Such plans show the numbers of people to be relocated as a result of plans for the elimination of slums and other governmental activity and also show the areas to be developed to accommodate families relocated from overcrowded areas. This requirement needs strengthening and positive Federal assistance. Relocation must be viewed as an integral part of urban renewal, and additional Federal assistance should be provided to aid cities in meeting the problem. The law should be amended (a) to require the presentation of a comprehensive plan for population density and for the relocation of population as a condition for Federal financial aid. Such a plan should show the estimated future population of the metropolitan area, allowed densities for different sections of the city, the numbers of people to be relocated as a result of plans for elimination of slums, and the areas to be developed to accommodate families relocated from overcrowded areas. (b) Vacant land assembly projects should be encouraged rather than discouraged. Such projects should be eligible for capital grants and should be averaged with all other projects for financial purposes. Where the families involved in displacement and where the proper solution to the relocation problem requires the development of vacant land, vacant land projects or other areas open to occupancy by such families should be shown to exist before clearance is permitted. (c) Existing relocation requirements of Federal law should be amended to require that adequate relocation housing will be available as families are displaced, rather than merely plans, after January 1, 1956, as a condition of clearance. (Relocation is still the most imposing obstacle to comprehensive redevelopment and rehabilitation. Almost all redevelopment and rehabilitation requires substantial reduction of the excessive population densities which are characteristic of slum and blighted areas. The renewed areas usually contain less people than the formerly blighted areas did. The excess people cannot return, they must go somewhere. They must go into other blighted areas or into newly developed areas on open land. The former merely spreads the slums. New housing on vacant land at prices within the means of the surplus displaced families should be required to be in existence before clearance is permitted. Only new housing on vacant land can permit orderly and permanent reductions in the population of overcongested areas.)

Attachment III

RECOMMENDATIONS OF THE NATIONAL HOUSING CONFERENCE TO EXTEND PRESENT CONVENTIONAL MORTGAGE CREDIT AIDS

Above the income levels we have described as families of middle income, there remain many families who cannot afford new private housing on present credit terms, or for whom the supply of new housing is inadequate. For these families improvements in the functioning of present credit and building systems are essential. The following are proposed: