demonstration concepts in the Federal Government. That is why I think this program is so important. I urge your consideration of it. Mr. BARRETT. Thank you, Mr. Mayor.

Good morning, Mr. Lindsay.

We are certainly glad to have our former colleague here, and such a distinguished mayor from the city of New York.

We will give the opportunity to the dean of the New York delegation on this committee to introduce the mayor of the city of New York. And I am going to recognize now Mr. Fino, who is the dean of the New York delegation.

Mr. FINO. Mr. Chairman, it is my distinct pleasure and honor to present to this committee a former distinguished Member of Congress, who, because of his outstanding ability, keen knowledge, and enlightening and forcible crusade last year, became the mayor of the greatest city in the world.

During his 7 years in Congress he distinguished himself as an able, outstanding, and dedicated legislator. Our loss in Washington was certainly a tremendous gain for the people of the city of New York.

And I am indeed happy to present to this committee our home mayor of the city of New York, John Lindsay.

Mr. BARRETT. Mr. Mayor, as I am quite sure you know, we have one of your former colleagues here who is with the Republican delegation with the State of New Jersey.

Mr. Widnall, would you like to welcome the mayor?

Mr. WIDNALL. Mr. Chairman, we have more deans here than we have in a university.

John, we are very pleased to have you here before us today and see you back in Washington, although I know it is for a very brief appearance. We do miss you in the Congress. You made a great contribution there. And we are very pleased that you have seen fit to bring your talent and your great leadership to the city of New York. Mr. LINDSAY. Thank you.

Mr. BARRETT. Mayor, I note that you have an associate with you this morning. Would von introduce him for the record so that we may ask questions of him?

STATEMENT OF HON. JOHN V. LINDSAY, MAYOR OF NEW YORK CITY; ACCOMPANIED BY EDWARD J. LOGUE, CHAIRMAN, TASK FORCE ON HOUSING

Mr. LINDSAY. First of all, I should like to thank you and your colleagues on the subcommittee for giving me this chance to appear before

you.

And as a personal note, I wish to say that it is a great statisfaction to me to be back in the Halls of Congress. I look upon it from a distance of 235 miles with some nostalgia from time to time. And it is good to be back. And I should like to thank all members of the subcommittee for their kindness in being here this morning. And, of course, to the dean of the New York delegation on the minority side, Mr. Fino, for his kind introduction, and Mr. Widnall, the dean of the New Jersey delegation on the minority side for his kind introduction. I appreciate it very much.

I have with me Mr. Ed Logue, who is known to many of you. Mr. Logue is the chairman of the task force that I put together on the

broad subject of development in New York City, including, of course, planning, housing, and other aspects of city life. He heads a team assembled across the country of experts in the field. He is spending a very substantial amount of his time with me in New York in making a survey of our whole structure of government, and the procedures and methods that have been followed in the past, in preparation for making recommendations for reorganization of our whole approach to the development and planning of New York City.

He is prepared, of course, to answer questions at the conclusion of the statement.

Mr. BARRETT. Thank you, Mr. Mayor.

Mr. Mayor, we certainly want you to feel at home here this morning, and I am quite sure I speak for everyone on this committee. If you desire to read your statement in full, you may do so, and we will ask you questions after you finish. But if you feel that you would like to be interrupted, you may indicate that, and we will abide by your desires.

Mr. LINDSAY. I do not mind being interrupted at all, if that is your wish. Maybe some of the questions you have will be contained in the statement.

Mr. BARRETT. I think then it would be the committee's desire to extend the further courtesy to you to complete your statement, and then we will come back and ask you questions.

Mr. LINDSAY. Fine, Mr. Chairman.

I am here today in support of the proposed Demonstration Cities Act of 1966-legislation of substantial importance to the Nation at large and to New York City in particular. For it is my belief that this legislation, if adequately funded could represent the dramatic breakthrough that we have long sought in dealing with our urban ills. Despite some concerns I have about the bill, which I will outline below, I want to emphasize that it does indeed offer a real opportunity to meet the great challenge of improving the quality of life in urban America.

We are all familiar with the programs and policies upon which this legislation builds. The Federal Government's involvement in the cities has long emphasized physical renewal with a continual broadening and expanding of programs. Public housing was the start. Then came slum clearance and urban renewal and most recently an increasing emphasis on the rehabilitation of existing structures. Gradually, we have learned that these building programs do not of themselves attack the hard core causes of urban poverty and blight. Over time, it has become painfully clear that much more than physical renewal is needed.

Out of this heightened awareness, the Congress has shaped new programs of social renewal, with such legislation as the Economic Opportunity Act, which have stimulated new approaches to the problems of discrimination, illiteracy, and inadequate job training.

By means of the Demonstration Cities Act, these two components of Federal involvement in our cities will be integrated and coordinated in a comprehensive effort. Social renewal programs will go hand in hand with projects for physical renewal. In one sense, this legislation is a culmination of all that has gone before-it could call upon the full arsenal of Federal programs for urban areas. Yet it also constitutes

a most important beginning-it views ultimately all these programs as working toward the goal of improvement of a physical environment combined with the promise of a new life for its residents.

The adoption of the legislation before us today should enable an interaction of programs which has been sadly lacking. We at the local level, could select blighted sections as demonstration areas in which truly integrated programs could be mounted for the first time. In the President's words, this effort must be "large in scope, more comprehensive, more concentrated than any that has gone before."

Physical renewal would emphasize rehabilitation and conservation, the preservation and indeed rejuvenation of existing neighborhoods. Demolition, as a tool, would be used where existing structures are beyond repair. Housing would be provided within the financial reach of those displaced. Space would be provided for schools, libraries, parks and playgrounds, health clinics, and other community facilities. This would be accompanied by intensive programs for social renewal: preschool programs for the very young; health assistance to eliminate dietary deficiencies; welfare guidance aimed at improved housekeeping and better budgeting; and, most important, to those who have been hampered, for one reason or another, from attaining meaningful employment. Here lies the capstone of the social renewal effort and, for that matter, the entire program. The completion of new buildings and facilities should be accompanied by the emergence of the neighborhoods' residents as self-supporting citizens able to sustain their revitalized neighborhood and to contribute constructively to the growth of our society.

The legislation, quite properly, places the principal responsibility for this physical and social change on local government. In doing so, it provides an important stimulus for improved coordination by city governments. Recognizing that responsibility for administration of these programs is usually divided at the local level, the President has recommended that the demonstration should be managed in each demonstration city by a single authority with adequate powers to carry out and coordinate all phases of the program. We are now moving to streamline the structure and operations of government in New York City to enable us to meet this challenge.

Experience has taught us some of the complexities and problems of large-scale Federal aid programs. Programs for physical revitalization, particularly urban renewal and public housing, have too often suffered from inadequate Federal funding and a lack of long-term financial commitment. Above all, lack of coordination in administration at both Federal and local levels has reduced the impact that some of the most farsighted programs might have attained.

It is my hope that in launching this new effort, the Congress will make very effort to insure that difficulties of administration do not handicap this program. At the same time, because the success of the demonstration cities program will depend on the effectiveness of the numerous underlying programs, I hope that the Congress will take this opportunity to remove some of the most grievous impediments from existing urban programs. My principal reservations about the proposed legislation will illustrate these concerns.

The President's message and budget call for $2.3 billion to be made available over a 5-year period beginning in fiscal 1968. In fiscal 1967,

a total of $17 million is to be made available for planning the demonstration.

These sums will limit sharply both the number of cities that may participate in the program and the scale and impact it can have on the individual communities which do, in fact, participate. It is of the utmost importance that the program be large enough and so apparent that our people will readily perceive its value.

I would urge that you amend the survey and planning provisions of the urban renewal program to have funds available as planning grants from that source. This would mean that a much larger amount of money could be made available and that the number of demonstration cities could be enlarged. A competition among America's cities with the fate of the poor at stake, is not a very attractive prospect for local officials.

I would further suggest that the entire $2.3 billion be made available in fiscal 1967 by contract authority. As you know, this means that the budgetary impact would be spread over the 6 years designated in the President's proposal. But it would give those communities which are prepared to move ahead more quickly the long-term commitment and necessary resources to do so. I would hope that in its report your committee would express its intent that the Secretary of Housing and Urban Development set as an objective the execution of contractual commitments for the entire $2.3 billion in fiscal 1967. This would give the sense of priority and urgency which I believe the program needs if it is to get the running start it must have to succeed.

When the entire amount has been committed and applications have been reviewed from additional communities, it would then be appropriate for the legislative and executive branches of the Government to decide whether to authorize more demonstration or wait until the results of the first round were in before beginning a larger program. I would certainly hope that the answer would be to authorize more demonstrations.

Many of us with local elected responsibility are concerned about the very real possibility that operating programs will not be able to start until fiscal 1968. This would be a disaster.

The poor in the troubled areas of our cities have heard about planning for too long. We are now witnessing a new and justified impatience. Action now is what they want and I think they should have it.

While we can all agree that a fully developed plan and program is desirable, it seems to me that there are many programs which can begin immediately; for example, intensive education programs and the early acquisition of sites for schools and for relocation housing.

I would urge that you consider amending the legislation to permit an early start on elements of the total program if the Secretary is satisfied that these elements will fit into the final plan and that the community has set up the proper administrative machinery to carry out and coordinate the overall program.

I urge that the Congress make a maximum effort to achieve administrative simplicity so that the high expectations we all hold for this program will not be frustrated in a bureaucratic tangle. The special 80-percent demonstration grant is the product of an extremely complex procedure because it is based on the local contribution to a

great variety of federally aided local programs. Although these many programs will constitute the components of the demonstration program, it is not necessary that the demonstration grant formula be tied to the computation of each individual program. I can see a hazard for communities, both large and small, not only in calculating these local shares, but, more importantly, in obtaining commitments for them from the many Federal agencies involved.

Let me suggest an alternative approach that would be considerably simpler and faster. A community would be given the option of waiving available Federal grants by submitting a single overall demonstration application which, if approved, would receive a Federal grant of 90 percent of the total cost. The city would have then to negotiate with only one Federal agency, permitting a rapid start and prompt followthrough. The 90-percent figure is somewhat less than I understand is expected to be the average grant under the complicated formula in the legislation.

Another alternative with similar advantages could require that a community seek all relevant grants that could be obtained quickly from Federal agencies, and then seek 90-percent Federal assistance for carrying out the rest of the demonstration, as approved by the new Department.

An effective demonstration cities program will quickly expand and accelerate the demand for Federal funds for existing aid programs, especially urban renewal, public housing, and community action. This will restrict the amount of funds available to those cities which are not conducting demonstrations while, at the same time, it is likely to heighten interest in and demand for these established programs by these same nonparticipating cities. As we are all aware, the demand for urban renewal and community action programs, in particular, far exceeds the supply.

According to the best information available to us, more than $800 million of urban renewal applications are now pending with the new Department. This enormous backlog should be funded without further delay. If these urban renewal projects could move forward in the hundreds of cities and towns where they are located they would make a substantial impact on housing and the physical condition of those cities. I would hope that early in this session of the Congress you would consider removing the annual limitations on the urban renewal program, restoring it to the contract authority approach and making it available for cities which need it as soon as they effectively demonstrate their needs. The informal "rationing" which has existed for many years has been a most important reason why urban renewal has not achieved its full potential.

In the past, in urban renewal and other programs, quotas have been set to limit the amount of aid given to New York City. While the concern of others that New York not gobble up entire programs is understandable, it seems fairer to me that the Congress provide programs as large as the problems-and in the case of New York City, the problems are of unparalleled magnitude.

It might be useful if I sketched for vou the dimensions of our problem. We have a population of 8 million people; 24 percent of our city's 2,655.000 households have an annual income under $3,000 making them eligible for consideration for poverty program activities;