The third requirement provides that there be "maximum opportunities for employing residents of the area in all phases of the proTC gram

* * *"

Is this meant to add a new citizen participation provision to each of the Federal programs which potentially might be drawn upon and utilized in a cities demonstration program?

The seventh requirement is that the program be designed to "assure maximum opportunity in the choice of housing accommodations by all citizens."

Inasmuch as State laws vary with respect to open occupancy, can the et Department indicate whether it intends to favor plans from cities where open occupancy is possible and is provided for in the plan, as against those cities where occupancy is not in the ordinance or otherwise in the statute book?

Mr. BARRETT. Would the gentleman yield?

Mr. ASHLEY. I have two more, and then I would be very happy to. The final requirement states that the program shall meet "such additional requirements as the Secretary may establish to carry out the purposes of this act."

Is it contemplated that such additional requirements would be substantive or procedural; can the Department indicate the kinds of requirements that might later be introduced pursuant to this section? Those are some of the questions that I have with respect to these seven general criteria.

Now I will yield.

Mr. BARRETT. I was just going to suggest-I know the gentleman has many more things to ask-I was going to ask if he would submit those questions to the Secretary. I notice Mr. Foard is trying to take it down.

Mr. ASHLEY. I have a copy of them. I would just as soon read them.
Mr. BARRETT. I think it might be more accurate.

Mr. ASHLEY. As I say, they will be available for the record. Mr. Secretary, subsection (c) on page 5 of the bill indicates that the Department will give maximum consideration to four criteria in reaching a determination as to which cities will be selected. Under the first, consideration is given to whether "substantive local laws, regulations, and other requirements are, or can be expected to be, consistent with the objectives of the program."

Again does this refer to such local laws as might relate to open occupancy? Can the Department indicate what other types of substantive local laws, regulations, and other requirements it has in mind that cities must be expected to respond to?

Secretary WEAVER. Do you wish that to be submitted also?

Mr. ASHLEY. Yes, please.

Secondly, consideration, as I said, will be directed to whether that program will enhance neighborhoods by applying a high standard of design.

Is it contemplated that a neighborhood plan will be sufficiently in detail that it would include design concepts?

The fifth consideration is that the program be consistent with comprehensive planning for the entire urban or metropolitan area. Again, does this mean that comprehensive planning will be a condition precedent to project approval, and if so, does such compre

hensive planning have to be in being or can it be undertaken in conjunction with the neighborhood project?

In other words, must the local community be engaged in a CRP, or in metropolitan planning? Just what is the position of the Department with respect to this requirement?

(The information requested follows:)

THE SECRETARY OF HOUSING AND URBAN DEVELOPMENT,

Hon. THOMAS L. ASHLEY,
House of Representatives,
Washington, D.C.

Washington, D.C., March 22, 1966.

DEAR MR. ASHLEY: During the course of the February 28 hearings on the Demonstration Cities Act of 1966 (H.R. 12341 and H.R. 12342) you requested written comments to a number of questions on the general criteria which a city must meet in order to qualify for assistance under that act. The questions you posed and our comments follow:

Question. The first requirement is that the program be "of sufficient magnitude in both physical and social dimensions (i) to remove or arrest blight and decay in entire sections or neighborhoods; (ii) to provide a substantial increase in the supply of standard housing of low and moderate cost: (iii) to make marked progress in serving the poor and disadvantaged people living in slum and blighted areas with a view to reducing educational disadvantages, disease, and enforced idleness; and (iv) to make a substantial impact on the sound development of the entire city."

I wonder, Mr. Secretary, if your Department can furnish guidelines as to what is meant by "entire sections or neighborhoods"?

Does the requirement that a substantial increase in the supply of standard housing of low and moderate cost be provided pertain to sections or neighborhoods where current density levels are already high? If not, does this requirement mean that there must be a substantial increase of standard housing of low and moderate cost in other than the project sections or neighborhoods?

Is the Department able to indicate how it will measure a "substantial impact" on the sound development of an entire city which the project section is required to make?

Answer. The term "entire sections or neighborhoods" will be interpreted in terms of the specific city involved and its particular neighborhood patterns. The intent is to deal with total cohesive areas rather than just small fragments of a few square blocks.

In his message transmitting recommendations for city demonstration programs, the President provided general criteria of what was intended. He indicated that a city program could involve as much as 15 to 20 percent of the substandard structures within the city. For the largest cities, such a program might involve a total of 35,000 dwelling units. For a city with a population of approximately 100,000, the program might involve 3,000 to 4,000 dwelling units.

The proposed requirement that there be a substantial increase in the supply of standard housing of low and moderate cost is intended to apply to the community as a whole and not just to the area of the demonstration. We expect that the bulk of the new standard housing of this category would be provided either through rehabilitation of existing housing or the construction of new housing in the demonstration area. However, if one of the problems of the demonstration area is excessive density, then a necessary part of the program would be the reduction of that density and the provision of housing in other parts of the community. It should be emphasized that there is no requirement that all of the activities of the local demonstration program must be carried out within the boundaries of the demonstration area. Some will be carried out in other parts of the community with the intention that they would have beneficial impact on the demonstration area.

A demonstration program will be making a "substantial impact" on the sound development of the entire city if the major social and physical improvements being made in the demonstration area or areas will make the city as a whole a better place in which to live and work.

Question. The second general requirement reads as follows: the rebuilding or restoration of sections or neighborhoods in accordance with the program will contribute to a well-balanced city with adequate public facilities (including those

needed for transportation, education, and recreation), commercial facilities adequate to serve the residential areas, good access to industrial or other centers of employment, and housing for all income levels.

Can the Department spell out for cities interested in this program what is meant by a "well-balanced city"?

Does the requirement that there be housing for all income levels mean that housing must be furnished within the project area or within the entire community?

Answer. The intent of this general requirement (subsection 4(b)(2)) is to assure that the demonstration area is not treated as a special enclave apart from the rest of the city. What is done in the demonstration area must be regarded as a part of the overall improvement of the city.

A "well-balanced city" is one which contains a mixture of the facilities and services needed to serve the diverse groups living and working in the city. It implies a variety of housing types, styles, and prices to provide an adequate range of choice for all who want to live in the city. It implies adequate and convenient commercial facilities to serve the needs of the residents. It implies adequate job opportunities and a transportation system to permit ready movement between residence and shopping and working areas. It implies adequate public facilities, including parks and other recreational facilities. In sum, a "well-balanced city" is one which provides the full range of services and opportunities which the average citizen expects to be a part of city living. The requirement that there be housing for all income levels does not apply to the demonstration area alone. The local demonstration program must contribute to that goal for the city as a whole. Generally, demonstration areas will be large enough that a variety of housing styles and price ranges to meet the needs of various income groups can ordinarily be provided within it. However, provision of housing for all income levels within the demonstration area is not a mandatory requirement since circumstances will vary from city to city and there may be sound reasons for not being able to supply a full housing mix within the demonstration area. On the other hand, the demonstration program should not result in increasing the concentration of housing at a single price level in the demonstration area.

Question. The third requirement provides that there be "maximum opportunities for employing residents of the area in all phases of the program

*

Is this meant to add a new citizen-participation provision to each of the Federal programs which potentially might be drawn upon and utilized in a city's demonstration program?

Answer. No. This requirement is designed to assure that, to the extent that job opportunities are created by the demonstration program, an effort will be made to make them available to the unemployed or underemployed residents of the area. This provision would add no further requirement to other Federal programs. However, it would require that the city make a conscious effort to see that the jobs created by these programs were, to the maximum extent feasible, made available to the residents of the area.

Question. The seventh requirement is that the program be designed to “assure maximum opportunity in the choice of housing accommodations by all citizens."

Inasmuch as State laws vary with respect to open occupancy, can the Department indicate whether it intends to favor plans from cities where open occupancy is possible and is provided for in the plan?

Answer. Open occupancy laws are only one method by which a city may undertake to assure maximum opportunity in the choice of housing accommodations. The existence of such a law is not necessary to achieve compliance with this requirement. The provision contemplates imaginative measures for maximizing housing choice rather than adherence to doctrinaire positions as to the desirability of particular local laws.

Question. The final requirement states that the program shall meet "such additional requirements as the Secretary may establish to carry out the purposes of this Act."

Is it contemplated that such additional requirements would be substantive or procedural; can the Department indicate the kinds of requirements that might later be introduced pursuant to this section?

Answer. This catchall general-authority provision has two purposes: (1) to serve as a base for procedural requirements, and (2) to permit the closing

of unforeseen loopholes. There is no intention of using this provision to impose new substantive criteria.

Question. Subsection (c) on page 5 of the bill indicates that the Department will give maximum consideration to four criteria in reaching a determination as to which cities will be selected. Under the first, consideration is given to whether "substantive local laws, regulations and other requirements are, or can be expected to be, consistent with the objectives of the program." Does this refer to such local laws as might relate to open occupancy? Can the Department indicate what other types of substantive local laws, regulations and other requirements it has in mind?

Answer. There is no requirement for the general review of local laws or regulations. The Department will be concerned only with those laws and regulations which have a bearing on the capacity of the city to carry out its demonstration, such as its housing, building, and zoning codes. In some cases, the existence of an open occupancy law might be an essential element in the capacity of a city to meet the goal of maximum opportunity in the choice of housing accommodations by all citizens. However, as indicated earlier, the existence of such a law is not at all mandatory if alternative approaches are provided.

Question. Secondly, consideration will be directed to whether the program will enhance neighborhoods by applying high standards of design.

Is it contemplated that neighborhood plans will be sufficiently in detail that they will include design concepts?

Answer. There is no mandatory design requirement in the act. Rather, the Secretary is directed to give consideration to local efforts to apply such standards in the carrying out of its demonstration program. To the extent a city proposes the application of high design standards, the Secretary will recognize this as an effort toward achieving the objectives of the act.

Question. The fifth consideration is that the program be consistent with comprehensive planning for the entire urban or metropolitan area.

Does this mean that comprehensive planning will be a condition precedent to project approval; if so, does such comprehensive planning have to be in being or can it be undertaken in conjunction with the neighborhood project?

Answer. There is no mandatory planning requirement in the act. However, the existence of appropriate plans and a continuing planning effort are indications of the extent to which the city has committed itself to sound development policies and they are matters to which the Secretary will have to give consideration. Equally, the extent to which the city's demonstration proposal is consistent with comprehensive planning for the entire urban or metropolitan area is a matter which will have to be considered.

Sincerely yours,

ROBERT C. WEAVER, Secretary.

Mr. ASHLEY. I am interested, Mr. Secretary, in how and where the $2.3 billion price tag came from on this program.

Referring again to the New York Times piece of Sunday a week ago, it was suggested that it was arrived at by determining the total cost of all the programs, bearing in mind that such programs would affect a certain percentage of the community-a certain percentage of dwelling units, people that the cost will be $5.6 billion, and that there would be derived from resale of land and improvement some $3 billion, leaving a net of $2.6 billion, the local contribution toward which would be $300 million and the Federal share $2.3 billion. Would you comment on this, please?

Secretary WEAVER. Yes.

As far as the figure of $2.3 billion is concerned, that is an estimate made by the Department on the basis of the best information that we currently have. Obviously it is an estimate. It is not a firm figure, because, No. 1, we don't know which cities will participate.

Mr. ASHLEY. I am interested in how it was arrived at.

epare

Secretary WEAVER. It was arrived at on the basis of assuming that anywhere from 60 to 70 cities of various sizes were to participate, and assuming further that if they were to participate, a certain number of gidwelling units would be involved, so many to be rehabilitated, and so many by new construction, and also that certain social services would be provided, and that all of this activity would result in a certain amount of Federal grant-in-aid programs. The total of the required local contributions in those grant-in-aid programs was then summed and 80 percent of that total became the figure which is the $2.3 billion figure.

n the

up,

Mr. ASHLEY. Isn't it true that the New York Times piece that I am sure you read as I did indicated that the impact of the program would be in the neighborhood of $6 billion?

Secretary WEAVER. That is the New York Times figure, and not our figure.

Mr. ASHLEY. I would be interested in a further detailed account of how the $2.3 billion was arrived at. I am interested in the total dollar impact of this program. The $2.3 billion represents, I understand, the Federal contribution toward the cities' share of the various programs. Is that not so?

Secretary WEAVER. No, sir. The $2.3 billion represents the amount of supplemental grant that would be given to the cities. That in turn is based upon the amount of the non-Federal cost of the grant-in-aid Federal programs that would be involved in these demonstrations. Mr. ASHLEY. Let's take an urban renewal project which is a part of a demonstration cities program. If it is a $80 million project, if the net project costs some $80 million, and there are no noncash credits available, the Federal Government would buy-let's make it $80would buy $60 million, and the local will be responsible for $30, isn't that correct?

Secretary WEAVER. That is right. The local then would get 80 percent of the $30 million in addition.

Mr. ASHLEY. Yes.

I don't see where the disagreement came from a moment ago when I suggested that the $2.3 billion is going to be corrected to picking up the local share of the various Federal loan programs.

Secretary WEAVER. The difference is that it is not as big as it should be, it is 90 percent.

Mr. ASHLEY. All right. Presumably there has been serious consideration given to the dollar impact to the program. I don't see how the dollar impact would be very much less than $8 or $9 billion, based upon-and I am talking about the total Federal contribution toward total local contribution, or should I say, in addition to total local contribution.

Secretary WEAVER. We estimate and these are all estimates, because I cannot give you firm figures now—we estimate that the total impact of this will be from $5 to $10 billion.

Mr. ASHLEY. I would appreciate it if there could be provided for the record the basis for that assumption.

Secretary WEAVER. In round numbers we would be happy to give

it to you.