FEBRUARY 25 (legislative day, FEBRUARY 21), 1949.-Ordered to be printed

Mr. MAYBANK, from the Committee on Banking and Currency, submitted the following

REPORT

[To accompany S. 1070]

The Committee on Banking and Currency, to whom was referred the bill (S. 1070) to establish a national housing objective and the policy to be followed in the attainment thereof, to provide Federal aid to assist slum-clearance projects and low-rent public-housing projects initiated by local agencies, to provide for financial assistance by the Secretary of Agriculture for farm housing, and for other purposes, having considered the same, reports favorably thereon without amendment and recommends that the bill do pass.

1. INTRODUCTORY STATEMENT

HEARINGS

Numerous bills dealing with a wide variety of housing proposals have been introduced in the Senate thus far during the first session of the Eighty-first Congress and have been referred to your Committee on Banking and Currency. Extensive hearings on S. 138, the administration bill, and S. 709, sponsored by a group of Republican Senators, and on other pending bills were held by the Subcommittee on Housing and Rents from February 3 through February 21, 1949. Testimony was presented by more than 75 witnesses, and the subcommittee considered numerous specific suggestions and amendments to the bill now being favorably reported.

While your committee called up S. 138 for consideration, the bill, as reported, combines the best features of several similar bills pending before the Banking and Currency Committee, and of various amendments recommended during the course of the hearings and by members of the subcommittee and of the full committee in the course of their consideration of the bill. After the full committee reached agreement on the legislation to be recommended, a clean bill (S. 1070) embodying that legislation was introduced under bipartisan sponsorship.

Your committee calls attention to the fact that this bill covers specific subject matters long considered by your committee and various special committees of the Congress. On four separate occasions similar legislation has been favorably reported by your committee, and twice approved by the Senate in bills passed by this body in the Seventy-ninth and Eightieth Congresses.

PHILOSOPHY OF THE BILL

The bill now being favorably reported by your committee is based upon the firm foundation that, although the housing problem is obviously national in scope, it is fundamentally a local problem, and that the first responsibility for its solution therefore rests with the local community. This bill leaves that primary responsibility with the local communities where it belongs. It recognizes that the need for any kind of housing action should be determined locally. It therefore provides that Federal assistance for the clearance of slums and blighted areas shall be available only for projects where there has been a local determination, by the governing body of the community, that the project is needed and where the plans for such project are locally made and locally approved. It therefore provides that Federal assistance for low-rent public housing shall be available only for projects where there has been a local determination, by the governing body of the community, that such housing is required in order to meet needs not being adequately met in that community by private enterprise, and where such projects are locally initiated, locally developed, and locally managed. It therefore provides that, in making Federal assistance available for farm housing, the Secretary of Agriculture shall have full authority to use local committees of farmers in order that there may be local determinations of the need for such assistance. This bill fully incorporates the basic philosophy that, if the people of a local community take no interest in that community's housing problems, it is not for the Federal Government to impose a program upon them. With this clear understanding, this bill then gives full recognition to the fact that there are many ways in which the Federal Government can and should render assistance to such local communities as themselves determine that they need and want that assistance in order to help them meet their housing problems effectively.

SCOPE OF THE BILL

Your committee is not, in this bill, attempting to deal with all of the main areas of the housing problem, or with the collateral problems which arise in connection with major housing legislation. This bill does not purport to be-and your committee is not presenting it to the Members of the Senate as-legislation authorizing the full and comprehensive housing program that is needed, or providing a complete and final solution to every phase of the complex housing problem. Convincing testimony presented during the hearings indicates that this bill does, however, represent the essential first action toward, and will provide the sound foundation for, such a comprehensive housing program.

The bill covers five major areas. First, it provides for a necessary and desirable declaration by the Congress of our national objectives in housing and the policies to be followed in attaining them. Second,

it provides the authorization of Federal financial assistance to communities for a long-delayed, but vitally needed, start on the clearance of slums and blighted areas for redevelopment. Third, it provides the authorization for a continuation and expansion of the program of extending Federal financial assistance to communities for low-rent public housing for families of low income. Fourth, it provides the authorization for a comprehensive program of Federal research in housing aimed at relieving the many technical, social, and economic problems which beset the whole field of housing. Fifth, it provides the authorization for a program of Federal financial assistance for the provision of decent housing for those families who live and work on the farms of the Nation, particularly for farm families of low income. In recommending favorable action on the bill at this time and in advance of consideration of other proposals, your committee has in mind the extended hearings, exhaustive investigation, and full floor debate which have been devoted to the basic principles and provisions of this bill during the past 4 years. It also has in mind the fact that these principles and provisions represent a sound foundation for the comprehensive action which is needed in order to make a real attack on the Nation's housing problem. It is therefore believed that, without further delay, Senate action should first be directed to the legislative proposals contained in this bill, which have been so thoroughly considered and on which substantial agreement has been reached.

OTHER HOUSING LEGISLATION

While the broad provisions of the bill now being reported are fundamental to any comprehensive and effective housing program, directed toward increasing and improving the general supply of housing in communities throughout the country, the testimony presented to your committee clearly demonstrates that other relatively urgent phases of the housing problem covered in other pending bills also require attention and action. The testimony of numerous witnesses impressed your Committee with the fact that the other more urgent phases of the problem include three main areas: (1) The need for developing a practical means of providing good housing for middle and lower middle income families who are largely priced out of the new housing market at the costs, prices, and rents generally prevailing today. (2) The need for modifications and improvements in the existing programs of FHA insurance of private mortgage investments in sales, rental, and cooperative housing, in order to give greater stimulus and assistance to increased production of privately financed housing of sound standards at more moderate sales prices and rents. (3) The related question of necessary revisions in the Federal Government's secondary market facilities for GI loans guaranteed by the Veterans' Administration, and mortgages insured by the Federal Housing Administration.

In recommending that the initial Senate action in the field of housing legislation be confined to prompt and favorable action on this bill to provide an initial and far-reaching foundation for a comprehensive housing program, your committee wishes to give its assurance to all those who have shown such a vital interest and concern about these various proposals, on which we have already heard testimony, that your committee proposes to take prompt action on those measures

which it can agree are urgently required if we are to have a truly effective housing program.

II. HISTORY OF THE LEGISLATION

SENATE SUBCOMMITTEE ON HOUSING AND URBAN REDEVELOPMENT

The legislative proposals embodied in this bill have received earnest and detailed study. Beginning in mid-1944, the Subcommittee on Housing and Urban Redevelopment of the Senate Committee on Postwar Economic Policy and Planning commenced an examination of every aspect of the housing problem. That subcommittee sent out a detailed questionnaire to major organizations throughout the country concerned with housing from construction, finance, labor, and consumer viewpoints. It also held extensive hearings during the period from June 1944 to February 1945, where again every available source of informed opinions was sought, including national organizations interested in housing, representatives of Federal, State, and local governments, and individual experts in the field of housing. August 1, 1945, the subcommittee, in its unanimous report, made specific recommendations relating to the need for action with respect to postwar housing. The recommended program included the following major points:

1. A declaration of national housing policy and objectives.

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2. The establishment of a permanent over-all Federal Housing Agency.

3. The continuance and improvement of Federal financial aids to private enterprise, such as those already established in the Federal Housing Administration, and the development of a plan for the guaranty of a minimum yield on debt-free investments in moderate rental housing.

4. The extension with perfecting amendments of the low-rent housing program authorized under the United States Housing Act of

1937.

5. The establishment of a new form of Federal financial assistance to help cities eliminate slum and blighted areas.

6. The development of plans for a comprehensive attack on bad farm housing conditions.

7. The establishment by the Federal Government of a comprehensive research program in the field of housing and construction.

S. 1592, SEVENTY-NINTH CONGRESS

On the basis of these subcommittee recommendations, Senators Wagner, Ellender, and Taft, in November of 1945, introduced S. 1592, Seventy-ninth Congress. The Committee on Banking and Currency then held detailed hearings on this bill during a period of 2 months. The bill was favorably reported (S. Rept. No. 1131, 79th Cong., 2d sess.) to the Senate in April 1946, was passed by the Senate, and was under consideration in the House of Representatives at the close of the Seventy-ninth Congress.

S. 866, EIGHTIETH CONGRESS

The basic legislative proposals which had been made by the Senate subcommittee and incorporated in S. 1592 were the subject of further

study and investigation by three committees in the Eightieth Congress. S. 866, of the Eightieth Congress, introduced by the sponsors of S. 1592 as a successor to that bill, was the subject of extensive hearings before the Senate Banking and Currency Committee in 1947 and again in 1948. That bill was favorably reported to the Senate in April of 1947 (S. Rept. No. 140, 80th Cong., 1st sess.).

JOINT COMMITTEE ON HOUSING

In the meantime, however, the Joint Committee on Housing had been created in July 9 of 1947, and was directed to conduct full investigation of the entire field of housing. The joint committee held hearings in 33 cities throughout the country. Its final majority report (H. Rept. No. 1564, 80th Cong., 2d sess.), issued on March 15, 1948, closely paralleled the conclusions reached 3 years earlier by the Senate subcommittee. This report of the Joint Committee on Housing formed the basis for certain modifications of S. 866 which were favorably reported by the Senate Banking and Currency Committee (S. Rept. No. 140, pt. 2, 80th Cong., 2d sess. and S. Rept. No. 1773, 80th Cong., 2d sess.).

S. 866 AMENDMENTS

These recommended amendments were adopted, and S. 866, as thus amended, was passed by the Senate, and a substantially similar bill was favorably reported to the House of Representatives by a majority vote of the members of the House Committee on Banking and Currency (H. Rept. No. 2340, 80th Cong., 2d sess.). Both bills expired at the end of the Eightieth Congress, however, without having reached a vote in the House.

Some of the provisions for aid to privately financed housing contained in S. 866 were enacted as the Housing Act of 1948, approved August 10, 1948. These consisted of improvements in the Federal Housing Administration's mortgage insurance programs, the new program for guaranteeing a minimum yield on direct investments in moderate rental housing, and a program of limited technical research. However, none of the legislation providing for aid in the main problem areas of housing-aid for slum clearance and the redevelopment of blighted areas, low-rent public housing, a comprehensive program of housing research, and aid for farm housing-was enacted.

It is this unfinished and unenacted housing legislation which your committee earnestly recommends as the first order of housing action by the Senate.

III. THE HOUSING NEED

The evidence and current testimony presented during the hearings concerning the dimensions of the housing shortage demonstrated increasing recognition of the fact that the housing problem is one of great magnitude and long standing. It also indicates that, in the main, such differences of opinion as still exist concerning the housing problem are concerned, not so much with the size or scope of the problem, or with the fact that further housing legislation is necessary to help meet it, as with the details of the means that should be employed in dealing with the problem.

The data available indicates that we must be prepared to build or rehabilitate an average of at least 1,300,000 nonfarm dwelling units,