In addition, the city's program must be more than a statement of goals. It must be a definite plan of action. Projects and activities to be undertaken must be scheduled and ready for initiation within a reasonably short period of time. All of the activities which are part of the program should be scheduled for completion within a reasonable period of time.

OTHER ACTIONS EXPECTED OF THE CITY

An important benefit of Federal grant-in-aid programs is the spur such programs provide to local activities which may not otherwise be undertaken. The demonstration cities bill calls on the cities to take a series of actions, in conjunction with their demonstration programs, designed to make significant breakthroughs in the techniques of rebuilding and restoring slum and blighted

areas.

Even though a city demonstration program meets the statutory criteria described, other actions may be expected of the city if new Federal aids are to be provided under this legislation. Consideration will be given to the extent and nature of purely local actions which encourage more rational and efficient urban development. In preparing their demonstration programs, cities will have toFirst, examine their substantive laws to determine the extent to which those laws impede substantial progress in carrying out their demonstration programs and to take appropriate action, if necessary, to make those laws consistent with the objectives of their programs.

In many localities, the structure of real estate taxes, inadequate and often obsolete housing codes and zoning laws, and artificial restraints on building practices retard the prompt and proper development of the city's physical characteristics. Stimulating local efforts to remove these restrictions can be one of the major benefits of the city demonstration program.

Second, apply high standards of design to buildings constructed and rehabilitated under the program in order to maintain distinctive natural, historical, and cultural characteristics.

Revitalizing the Nation's cities requires more than the construction and rehabilitation of homes and buildings. City demonstration programs should contain special efforts to make new and existing structures as fresh and attractive as possible.

Third, make maximum use of new and improved technology and design, including the introduction of cost-reduction techniques to every aspect of a city's activities.

Massive rebuilding and restoration programs provide exceptional opportunities for applying the fruits of our technological advances to the homebuilding and rehabilitation industries. Cities should encourage the maximum use of such advances in the building and rehabilitation of homes and buildings.

Fourth, encourage good community relations and counteract the segregation of housing by race or income.

The physical rebuilding and restoration of our cities should be accompanied by appropriate actions to narrow the housing gap between the poor and disadvantaged and the rest of the community. Nondiscrimination in any housing assisted under a demonstration program is a legal requirement. In some cities, however, the mere requirement of nondiscrimination will not be sufficient to resolve the manifold problems to which rigid, and often longstanding, patterns of housing segregation have given rise. More affirmative action is needed to eliminate these patterns, to reduce the squalid concentrations of racial minorities and the economically deprived, and to assure that equal opportunity in the choice of housing will in fact be available to people of every race and income. Fifth, indicate that the projects and activities carried on under the program are consistent with comprehensive planning for the entire urban or metropoli

tan area.

Central cities are the economic and cultural cores of larger urban or metropolitan areas. As such, their activities affect the entire urban or metropolitan area. And the cities, in turn, are affected by activities undertaken in the entire area. No element of rational urban development is more important than the carrying on of sound comprehensive planning for entire urban and metropolitan areas. Cities will be expected to continue to cooperate with other governmental bodies in the metropolitan area to assure and promote sound community growth. A program meeting the statutory criteria for a comprehensive city demonstration program-and commtting the city to take those additional actions which may be expected of it—is not lightly undertaken.

But nothing less will do.

Only with a total commitment of their energies and resources and the desire and will of their people can the American cities stop the deterioration of their physical environment and social disorientation of large numbers of disadvantaged minority groups concentrated in low-income ghettos.

FEDERAL ASSISTANCE PROVIDED

The demonstration cities bill will provide Federal assistance for planning, developing, and carrying out comprehensive city demonstration programs. Federal funds will cover up to 90 percent of the cost of planning and developing these programs. Federal grants will also pay up to 80 percent of the cost of administering every project or activity which is included as part of a comprehensive city demonstration program (but not the cost of administering any project or activity for which Federal financial assistance is provided under an existing grant-in-aid program).

In addition, two types of Federal assistance are available to help finance all of the projects or activities which are included as part of an approved comprehensive city demonstration program.

First, to the extent such projects or activities are eligible for assistance under an existing Federal grant-in-aid program, they may be financed under that program. This bill contemplates that existing Federal grant-in-aid programs-and funds now available for those programs-will be utilized, where feasible, in carrying out projects or activities which, though part of a comprehensive city demonstration program, are eligible for assistance under existing grant-in-aid programs.

The fact that a particular project or activity eligible for assistance under an existing Federal grant-in-aid program is undertaken as part of a comprehensive city demonstration program will in no way affect its eligibility for assistance under the existing grant-in-aid program. The city will apply to the agency which administers the grant-in-aid program and the application will be subject to all the existing rules, regulations, and priorities governing that grant-in-aid program. Second, special grants, supplementing the assistance available under existing grant-in-aid programs, will be provided under the demonstration cities bill to (1) assist cities to provide their required share of the cost of projects or activities which are part of the demonstration program and are funded under existing Federal grant-in-aid programs, and (2) provide funds to carry out other nonfederally assisted projects or activities (including projects or activities of the type eligible for Federal assistance under existing grant-in-aid programs), undertaken as part of the demonstration program.

The amount of this special-supplemental-demonstration cities grant will be SO percent of the total non-Federal contributions required to be made to all projects or activities assisted by existing Federal grant-in-aid programs which are carried out as part of a comprehensive city demonstration program.

The non-Federal contribution to every project or activity which is included within an approved comprehensive city demonstration program, and which is funded under an existing Federal grant-in-aid program, may serve as a base for computing the special-supplemental-grant under the demonstration cities bill. It does not matter whether the Federal commitment to assist in financing the particular project or activity under an existing grant-in-aid program occurred at some time before the comprehensive city demonstration program is approved. So long as the activity financed by the existing grant-in-aid program is included within the approved city demonstration program, the non-Federal contribution to that project or activity can serve as a base for the grant computed under the demonstration cities bill.

The special-supplemental-grant funds authorized to be paid by the demonstartion cities bill are not earmarked for any one specific project or activity carried out as part of the demonstration program. After the amount of this special-supplemental-grant is established under the formula in the demonstration cities bill-the total amount will be available to the city to be used at its discretion for any project or activity which is included as part of an approved comprehensive city demonstration program.

Grant assistance will be provided under the demonstration cities bill to cover the full cost of providing relocation payments to individuals, families, business concerns, and nonprofit organizations displaced by projects or activities which are part of a demonstration program.

Technical assistance will be available to assist city demonstration agencies to help them plan, develop, and administer their programs.

MAINTENANCE OF EFFORT

The special-supplemental-assistance to cities provided by the demonstration cities bill is not to replace local funds already being used to rebuild and restore slum and blighted areas and provide community facilities and services to their residents. Accordingly, it will be required, as a condition to receiving assistance for an approved comprehensive city demonstration program, that the city not reduce, during the period an approved program is carried out, its prior level of aggregate expenditures for projects or activities similar to those being assisted under the demonstration program. In addition, a city will not be permitted to use grant funds provided under the demonstration cities bill as a substitute for local dollars committed, prior to the application for the planning of the demonstration program, to be spent for a project or activity for which Federal financial assistance is being provided under an existing Federal grant-in-aid program.

PREPARING A COMPREHENSIVE CITY DEMONSTRATION PROGRAM

A. City demonstration agency

The Federal assistance authorized by the demonstration cities bill will be provided to a city demonstration agency. The city demonstration agency may be the city or any local public agency established or designated by the local governing body to administer the comprehensive city demonstration program. The city demonstration agency, therefore, may be a public agency created expressly for the purpose of administering the demonstration program or it may be an existing local public agency assigned this responsibility. A very wide range of administrative organizations are permissible so long as the structure serving as the city demonstration agency constitutes a public body which is subject to the control of the local governing body.

Whatever the administrative organization of the city demonstration agency, it must have the endorsement and support of the elected officials of the city and the agency must have sufficient power and authority to undertake the overall administration of the demonstration program.

This does not mean that the city demonstration agency would have to assume operational control of all projects and activities which are a part of the local demonstration program. For example, to the extent urban renewal activities are a part of the demonstration, the existing urban renewal agency would carry out such projects. School boards would continue to direct educational activities in the demonstration area.

The function of the city demonstration agency would be to obtain the cooperation of all participants and obtain their agreement to a concentrated and coordinated effort. The agency would have a strong tool for obtaining such cooperation in its capacity to use demonstration grant funds to supplement existing efforts.

The city demonstration agency could establish, in some appropriate way, an advisory body composed of both public officials and private citizens who are representative of the various public and private interests whose coordinated activities will constitute the demonstration. Independent or semi-independent local government units such as school boards, redevelopment agencies, housing authorities, and community action agencies could also be represented. It may be desirable to have private citizens represent the views of private agencies and business interests. Citizens of the area may be represented by the chairmen or directors of representative neighborhood organizations serving as members.

B. Planning and developing the city demonstration program

The city demonstration agency will apply to the Secretary of Housing and Urban Development for a grant to pay 90 percent of the cost of planning and developing the comprehensive city demonstration program. The application for this grant would have the approval of the local governing body of the city. Before he makes a grant to plan a comprehensive city demonstration program, the Secretary of Housing and Urban Development must determine that there exist (1) administrative machinery through which coordination of all related planning activities of local agencies can be achieved, and (2) evidence that necessary cooperation of agencies engaged in related local planning can be obtained.

Applications for assistance to plan and develop a comprehensive city demonstration program will be required to set out in broad and general terms what the city intends to do and how it intends to go about it. This initial proposal will be tested and refined during the planning and development process and usually

some proposed projects and activities might well have to be modified or dropped and others added as a result of that process. At the initial application for planning assistance the city will often have only a general idea of the components of its proposed demonstration program and the means by which they will be carried out.

As an example, when the application for planning assistance is made, the city might propose with regard to relocation that a central relocation bureau would be created, that early contact with relocatees would be made, that there would be followup after relocation, that new housing construction would be correlated with relocation needs, etc. However, it would not be required that a specific relocation plan in terms of numbers of people and their economic characteristics and the numbers of available units and their economic and physical characteristics have been developed at this stage.

The bulk of the effort during the planning and development period will be spent in refining the program elements of the initial proposal and developing their inter. relationships, working out organizational arrangements, and scheduling and budgeting program activities. The planning and development period will not require more than 6 to 8 months, and usually less time. Much information in terms of needs identification will already be available. Many cities that will be in a position to qualify as a demonstration city will already have undertaken a community renewal program, will have a community action agency which will have already collected data on social problems and needs, and will have a well-developed physical master plan and capital improvements program.

Completed plans for comprehensive city demonstration programs will be reviewed by the Secretary of Housing and Urban Development to determine that (1) they satisfy the statutory criteria for demonstration programs, and (2) the various projects or activities to be undertaken in connection with the program are scheduled to be initiated within a reasonably short period of time.

THE AREA OF THE DEMONSTRATION PROGRAM

Administration programs need not be limited to a single geographically delineated demonstration area in which slum and blight are to be removed or arrested. Rather, there may be several of such areas of varying sizes in the city. In addition, a wide variety of activities which serve the demonstration program, no matter where located, may be included in the demonstration.

For example, a hospital or vocational school which serves the needs of residents of slum and blighted areas may be a part of the city's program though constructed in a section which does not require clearance or rehabilitation treatment. Similarly, providing housing for families displaced from slum and blighted areas may involve construction activities outside of the slum and blighted areas in a wholly different portion of the community.

Grant funds provided under this legislation will, therefore, be available for certain communitywide activities, and the cities will be expected to study the effect and impact of their prorgams with a view to the well-being of the entire community.

FEDERAL COORDINATION

For each locality that has a comprehensive city demonstration program, a Federal coordinator will be designated by the Secretary of Housing and Urban Development. The coordinator will not be involved in the planning and development of the cities demonstration program. He does not come into existence until a demonstration program meeting the statutory criteria has been approved by the Secretary.

The coordinator will expedite and coordinate Federal contributions and technical assistance to the various projects and activities that are a part of the approved demonstration program. He will provide liaison services between the local city demonstration agency and national representatives of the Department of Housing and Urban Development and of other Federal agencies providing assistance for these projects or activities. He will report regularly to the Secretary of Housing and Urban Development.

The coordinaator has no authority over, and no power with respect to, the activities of Federal agencies other than the Department of Housing and Urban Development. He has no authority over local officials, and no power with respect to the programs and activities of the locality.

In addition, the Secretary of Housing and Urban Development is required to consult with each Federal department and agency affected by the comprehensive

city demonstration program before making a commitment to make grants for the program.

THE CITIES' NEEDS

A comprehensive city demonstration program will not replace existing Federal programs which now assist cities to provide for their urban development and growth. Rather, it will supplement and tend to encourage the focusing and coordination of existing programs, such as the urban renewal, mass transit. antipoverty, and health and welfare programs, in rebuilding and revitalizing urban areas. By encouraging coordination of these existing urban aids, the new program will achieve the maximum concentration of all available resources in order to improve substantially the conditions of life in urban areas. The cities which need to undertake comprehensive city demonstration programs desperately require every bit of this additional Federal assistance.

The great problems confronting the Nation's cities are well known.

Slums and blight are widespread. Persons of low income concentrate increasingly in the older urban areas. Housing and community facilities are services are inadequate.

Cities are caught in a descending spiral which leads to widespread municipal insolvency. The continuing spread of blight reduces the taxable value of city land. As slums and blight spread, crime, delinquency, and disease follow.

At the same time as the need for city services grows, the city's ability to provide these services is impaired by the very blight that creates the demand. Greater blight-greater demand for city services-decreasing revenues to meet the demand-that is the downward trend in many American cities. In these circumstances, it is not surprising that the cities with the greatest slum problems have the least capacity to deal with those problems.

Significantly, the efforts of our cities to help themselves are in large measure self-defeating. The more determined the city's efforts to raise funds to meet the need for increased services, the more likely that effort drives its economically affluent citizens to the nearby suburbs. Similarly, the greater burden the city places on industry within its borders, the smaller its opportunity to attract, and hold, the industry and commerce its economy requires. As a result, the city becomes, increasingly, a home for the economically deprived, those least able to bear the cost of municipal services.

The city plays a critical role in American life. It must provide jobs and adequate housing and education for millions of the Nation's unemployed, ill housed, and uneducated. It must provide community facilities and health and social services on a scale unprecedented in the Nation's history. And, it must do so in the face of overwhelming demands on its skills and resources.

The success of the city in providing the physical and social framework through which millions of poor and disadvantaged Americans are prepared to participate fully in the Nation's life-is a vital national concern. The city is performing an essential national function.

The objective of the President's program and the demonstration cities bill is to help the city to adequately perform that function.

URBAN DEVELOPMENT ACT

The bill referred to as the Urban Development Act deals with the problem of urban growth.

TITLE I-GRANTS TO ASSIST IN PLANNED METROPOLITAN DEVELOPMENT

Purpose of title

The first title of the bill would provide the new incentive for effective metropolitan planning and development recommended by the President in his January 26 message on city demonstration programs.

In brief, the incentive consists of increased aid to federally assisted projects of types which generally affect the growth of metropolitan areas. This aid would be given only within metropolitan areas where all public and private development having major areawide impact is consistent with fully comprehensive and current metropolitan planning.

This represents a new approach to making planning effective. It would not deprive any project of aid it would receive under existing programs. It would simply increase assistance to cities and other State and local bodies that actually develop projects and administer local zoning and subdivision controls consistently with metropolitan plans.