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us all, and I think this committee, Mr. Chairman, can claim a great deal of credit in the constant facilitation of homeownership for people in that bracket.

In short, I am not pleading that anything less be done in that bracket. I am rather concentrating such help as I can give to the committee in terms of help which we can give to people who are in a lower income bracket. That has been a constant problem here.

Now, the need, of course, is extremely urgent and very difficult. Everybody knows his own community. In New York City we have 500,000 really substandard housing units, and an overwhelmingly difficult relocation problem. I am all for slum clearance and urban development, and we have one of the great projects in the country in my own community, which, incidentally, is financed by Columba University and the great cultural institutions which surround it, the various seminaries, the Riverside Church—it is quite a distinguished civic effort in slum clearance.

Yet in that project—and it is symptomatic of our situation, I had to work very hard on behalf of the people who live there to be sure that the project which the colleges and other people were interested in was teamed up with a public housing project, otherwise the relocation problem would have been absolutely impossible.

We have about 56,000 families to relocate in New York City alone, of whom the most conservative estimate is that close to a half will have to go into public housing. So that is a real problem.


I would like to come, then, Mr. Chairman, to my fundamental point in this testimony, which is the public housing approach. I think the problem of figures has been settled for us now by the administration putting forward this 4-year program of 35,000 units per year. the chairman knows, I am well acquainted with the history of this, and I know that the Appropriations Committee has taken over the writing of the number of public housing units.

Mr. Chairman, they may have done it, but that doesn't make it right. It is the function of this committee. I think the most valid argument made against that approach by the Appropriations Committee has been that it is not considered in terms of overall housing needs of the country, or even in terms of the housing program, which the Appropriations Committee is in no position to do. This is the committee which ought to write the ticket in that connection, and I hope very much, Mr. Chairman, that the committee will see fit to do that.

The Housing Act of 1949 is, of course, an authorization. Anything else that the committee sees fit to do will, of course, be an authorization. But it will be an authorization which is based upon findings of fact by a committee charged with the responsibility in this very field. I believe it will be persuasive to the Congress and House of Representatives because it is in pursuance of part of the administration's own policy.

And so, Mr. Chairman, I hope that this committee will not be dissuaded from undertaking to act in the public housing field by the fact that the Appropriations Committee has assumed that power, but that this committee will undertake that responsibility.

I believe it is the strong weight of responsible opinion in the country that the administration's program of 35,000 public housing

units per year is certainly minimum. Certainly Mr. Cole's advisory committee was not prejudiced in favor of public housing, and after going through the whole situation from stem to stern they felt that there still remained a marginal need, and they sought every way they could to satisfy it, and they came to the conclusion that it just could not be satisfied except with some kind of a program of that character. I believe that the idea of a 40-year mortgages for $7,000 homes is a good idea, but it is very experimental. All the banking people, I understand, said that it is very unlikely that any such program can actually be put into effect. The people don't want chimeras or illusions or provisions in bills, they want housing programs starting from the bottom up, and, I believe, and I respect fully submit to the Chair, that this committee should act in that public housing field, especially as it will be implementing the administration's program. Just a word about FNMA in that connection, while we are talking about the 40-year $7,000 homes: I know what the proposal is for FNMA, and, again, I believe that FNMA can serve an enormously useful function; I believe that it can raise money from the public, but I have had occasion, in the course of professional activity, to sound out some of the great institutions of the country having enormous pools of money that ought to be available for mortgages-really enormous, in the billions-on this question of mortgage money, and I believe, Mr. Chairman, from that experience, which is professional and quite aside from my function as a Congressman, that the only way that the FNMA can be successful in terms of making mortgage money available in the way in which the President's program, and the bill contemplates that it should, is if these debentures are guaranteed, and Mr. Chairman, I don't see why we should hestitate to provide that in view of the fact that we haven't hesitated to provide for tens of billions of dollars in guaranties of the mortgages themselves, without feeling that that added appreciably to the liability of our country, because the security is so sound.

Therefore, I think that it is necessary to get money into FNMA in order to facilitate mortgage lending, and the debenture idea, and the idea of ownership by those who sell mortgages to FNMA is very sound. Why we can't go that extra step and assure success through having the debentures, themselves, guaranteed, I don't know.

Now, Mr. Chairman, just one final word on the minority housing situation. That has come in for a good deal of attention; though I don't agree with the way in which it has had attention, nevertheless such part of it as has been done by the housing Administrator has been done sincerely and with a real effort to make progrsss in terms of housing for minorities, especially for Negroes.

I believe, however, that the real way in which to do it, the fundamental way in which to do it, is not alone to endeavor to interest builders through the various means which the housing authorities have, in constructing projects which will be available to minorities. I believe the real way to do it is once and for all to end any FHA aid to projects which are segregated.

And interestingly enough, Mr. Chairman, this is not, as I understand it, a southern problem. On the contrary the segregation problem is much greater in the North, in terms of housing, than it is in the South.

Mr. Chairman, I make this assertion for a fundamental reason: A survey by the National Association of Home Builders-and I have it here, and it is in their March 1954 issue-shows that the principal impediment to the construction of housing for minorities is the unavailability of mortgage financing. That is shown on page 11 of their survey, and it is headed "Reasons for lack of activity in this field were quite diverse," but shows which stood out most prominently were: Lack of mortgage financing, 40 percent.

Certainly that is a very material part of the whole difficulty. And, Mr. Chairman, I submit that if neighborhoods are nonsegregated, if people of all colors can move into them, then the mortgage money situation no longer become a factor. It is a factor in terms of neighborhoods which will be largely available to minorities. It would cease to be a factor if the minorities took their place in all neighborhoods in the modest proportions in which they figure in all neighborhoods certainly in the North, where their proportion is in no case more than about 10 percent.

Mr. MULTER. May I interrupt you there for a moment: How would you implement or effectuate or enforce that kind of a provison? Mr. JAVITS. I believe the provision can be enforced by the terms of the mortgage guaranty, and that is what I am talking about, and I think that can be done administratively.

Mr. MULTER. Would you be more specific?

Mr. JAVITS. I believe that the mortgage guaranty can provide that the policy pursued in the renting or sale of homes shall be without discrimination as to race, creed, or color, and the Commissioner would receive complaints of violation on that score.

Mr. MULTER. Let us assume we have that language in a form that you and everybody else agrees will accomplish the purpose. How is that going to compel the lender to lend the money? That is the problem. You said the survey shows it, and I agree with you, and everybody else does.

Mr. JAVITS. Right.

Mr. MULTER. The difficulty is in getting the lender to lend the mortgage money. We have got the guaranties in the act now. Suppose we write all sorts of additional language that the guaranty will not apply unless this general situation is followed, and the intent is followed, and everything else, that there be no discrimination. How are you going to make the lender lend the money to a nonsegregated project?

Mr. JAVITS. If the rule is universal, there are no loans except with the nonsegregated provision.

Mr. MULTER. You and I are in agreement as to what we want to accomplish.

Mr. JAVITS. May I finish?

Then the lender has only this choice: He will stop any kind of lending to any project because any project, no matter where he lends, will contain this provision. Sometimes you have to have a showdown between the Government and lenders.

Mr. MULTER: Suppose the provision is there.

Mr. JAVITS. Yes.

Mr. MULTER. The provision is there, and the builder is putting up a segregated project. He doesn't say it is segregated. He simply

puts up a project and everybody who comes there who is not white is turned away. Every minority group is turned away, when they come looking for a house to buy or an apartment to rent. There is nothing in the documents to say they are going to discriminate.

How can you make the lender hold back his money?

Mr. JAVITS. The guaranty will not apply. The lender will not be covered by an FHA guaranty if there is proof of the fact that there is segregation or discrimination followed in that project, and if that is universal then lenders have a choice of lending without an FHA guaranty, or with it. That is my point in saying you have to have a showdown on this thing, and the only way to have a showdown is to make it universal.

Mr. MULTER. I am afraid all the language in the world would not accomplish our purpose until you get the lender to do as they are beginning to do now, and that is for the lender to lend the money to these projects. As long as they sit back and say, "We won't lend on these projects," all the language in the world is not going to make them do it.

Mr. JAVITS. I make the point-and I know my colleague and I are in agreement only that if the rule is universal, which is the fundamental point I make, then you have a choice only of the lender being on strike against FHA guaranties, and that showdown you have got. to have.

That concludes my statement, Mr. Chairman.

The CHAIRMAN. Thank you, Mr. Javits.

Mr. MULTER. One other point if I may, Mr. Chairman.

Mr. JAVITS. I have a hearing of my own.

Mr. MULTER. Just one question. Have you presented your views on public housing to the Appropriations Committee?

Mr. JAVITS. I understand that the Appropriations Committee doesn't hold hearings of this character. I am glad you prompted me. I will present my views.

Mr. MULTER. I don't know what the reaction of this committee is going to be. I have already pointed out that unless we write back into the law affirmative provisions we will get no housing.

Mr. JAVITS. I just testified to that.

Mr. MULTER. But as of yesterday the off-the-record opinion was that the Appropriations Committee is not going to appropriate any money for public housing, that is for new starts in public housing and unless somebody goes to work there, even if we get the authorization here we will still have no money for it.

Mr. JAVITS. Well, you are and I am sure I will, and I hope there will be many others like us.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you, Mr. Javits.

Congressman Jones, we are very glad to have you here this morning. Mr. JONES. Thank you, Mr. Chairman.


Mr. JONES. Mr. Chairman and members of the committee, I appreciate the opportunity I have been afforded to discuss with you the continuation of title V of the Housing Act of 1949.

I have not had the pleasure of appearing before this committee since that date, because there has been, under an amendment, a continuation of that act for an additional year, through fiscal 1954.

When the President transmitted the budget to the Congress, there was omitted any reference to funds to be made available for the rural housing program.

Mr. Chairman, I was very apprehensive that the administration intended to neglect the housing needs of our farm people. And I was under that fear and apprehension for some time, until the Secretary, Secretary Benson, in a speech at Tuskegee, Ala., stated that the program had been a tremendous success, and in substance he stated that it would be a policy of this administration to continue the farm housing program. The administrative agency that is charged with the responsibility of carrying out the rural housing provisions of the 1949 act,

that is.

Mr. SPENCE. Will the gentleman yield?

Mr. JONES. Yes, sir.

Mr. SPENCE. Have you a breakdown of the loans that were made by the Farm Loan Administration?

Mr. JONES. A breakdown of the total amounts of money made available, Mr. Spence? Or do you have the various categories of loans that were made? Do you have reference to loans that were made for housing, for chickenhouses, and that sort of thing?

Mr. SPENCE. I think they made 18,401 loans, 7,675, the total amount for $93,992,000. I have a breakdown of that that I would be glad to insert with your testimony.

Mr. JONES. I would appreciate it very much because I do not have a breakdown of the specific characters of the loan, because under the provisions of the act, the loans under title V could be made for water systems, for barns, for any appurtenances belonging to an orderly farm unit.

Mr. DEANE. Mr. Chairman, will Mr. Spence yield at this point? Mr. SPENCE. I would like to have this breakdown inserted in the record at this point.

The CHAIRMAN. That may be done.

Will you yield to Mr. Deane?

Mr. SPENCE. I yield.

Mr. DEANE. On that point, Mr. Jones, I have a letter dated February 16, 1954, from Mr. McLeaish, the Administrator of the Farmers Home Administration, giving me this information:

As of the end of January, the reports received from our State offices indicate that there are on hand 5,020 applications for farm-housing loans, and of this amount, 1,971 are from veterans. Applications on hand multiplied by $5,100 (the estimated average-size loan for the 1954 fiscal year), would amount to $29,116,000. The farm-housing funds remaining unobligated for the 1953-54 fiscal year are $3,219,226. Loans are in process which will use these funds by April 1 of this year.

Mr. JONES. There has been a ready acceptance, on the part of the farmers, to utilize this program, which is attested by the fact that in my own State of Alabama all the funds allotted to that State have been obligated within 60 days, and there are pending in the Southern States far more applicants than there would be money to satisfy their needs.

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