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In the New England States of Maine, New Hampshire, and Vermont, the average life of the home, in 1949, was 95 years. So you can readily see that those homes could not be of modern standards or possesing the things that we would normally expect a home to contain, such as running water, indoor toilets, and the basic sanitary requirements.

In the 12 Southeastern States, what we call the Cotton Belt, there lives one-half of the rural population of America, the lowest income group in America today-the so-called cotton farmer. How are we going to improve living standards if we don't have available a loan program that recognizes the economic situation that exists in those States?

Mr. DEANE. Mr. Jones, do you know who is opposing this program? Do you know why the title V was left out of the bill?

Mr. JONES. I haven't heard any complaints against the program. I didn't know there were any.

Mr. DEANE. Even if the interest rate under the Bankhead-Jones Act is increased I doubt the lending institutions will make insured rural loans. For example, I am now reading from a letter from Administrator Higley of the Veterans' Administration, giving me the facts on the loan guaranty program for 1953.

"There were 322,160 VA home loans. There were only 1,455 VA farm loans." This is an indication to me that the insured farm loan program is not attractive to lenders.

Mr. JONES. There is no demand on the part of the farmer for an insured program. He just doesn't think along those lines. In every type of loan program, insured loan program, it hasn't been successful for the farmer.

You will recall that under the REA Act, there was a provision for loans for water systems. So far as I know no loans are being made under that provision. At least I haven't heard of any.

Mr. DEANE. Thank you.

The CHAIRMAN. Are there further questions of Mr. Jones? If not, thank you very much, Mr. Jones.

Mr. JONES. Thank you very much, Mr. Chairman.

I would like, Mr. Chairman, to insert a short statement on this subject in the record.

The CHAIRMAN. That may be done.

(The information is as follows:)

When the Housing Act of 1949 was passed, we recognized the need for financial assistance to both farm and city families living in substandard homes if these families were to have an opportunity to obtain decent and adequate housing.

Title V of the act specifically authorized loans to farm owners to enable them to build, modernize, or repair their homes and farm service buildings needed to operate their farms profitably. The original act authorized annual appropriations for 4 fiscal years, beginning July 1, 1949. Although the law was amended in 1952 to extend the appropriation authorities for an additional year, no provision for loan appropriations was made beyond the 1954 fiscal year.

The bill I have introduced would extend and place on a continuing basis the authorities of title V of the Housing Act of 1949. Recognizing that loan authorizations for farm housing purposes are dependent, in part, upon economic conditions and other budgetary considerations, this bill authorizes appropriations and borrowing authority in such amounts as Congress may from time to time determine.

The original act authorized appropriations of $275 million for farm housing purposes. Only about a third of this amount was actually made available. The general curtailment of nondefense Government expenditures associated with 44022-54-54

the Korean campaign, as well as certain building-material shortages that existed in past years, are the principal reasons why the farm housing program did not reach its anticipated volume. The amount available for the 1954 fiscal year was $19 million. The demand for these loans was so great that almost all of the funds were committed within 6 months. The Farmers' Home Administration has received thousands of applications that now are unsatisfied because the farm housing funds were exhausted at such an early date.

Nearly 19,082 farm families have benefited from the $94,356,000 of farm housing funds that have been made available. With these funds they built or repaired over 16,000 farm homes, almost 14,000 farm service buildings, and 7,200 water systems. In my home State of Alabama, 724 families have received farm housing loans to build new and modern homes and 208 additional families repaired and modernized their homes. In addition, 368 farm service buildings and 623 water systems have been financed with farm housing funds. Through December 31, 1953, $5,509,475 had been loaned to Alabama farmers for these purposes.

This is a mere beginning in solving the problems of substandard housing on our Alabama farms but it does demonstrate the effectiveness of the farm housing loan authorities in meeting a critical need of farm families for construction credit.

That Alabama farmers want better housing is shown by the fact that the demand for these loans was so great during the past year that 80 percent of the funds allotted to Alabama were obligated within 2 months.

The cost of these new homes has been exceptionally low. To a person accustomed to the price of city homes, it seems almost unbelievable that farm families should be able to build good, substantial homes at an average cash outlay of less than $6,500. While these homes are modest in design, they do meet all the generally accepted requirements of decent, safe, and sanitary living. Low cash cost when compared with similar urban homes results from a number of reasons. One is the fact that there is no land cost involved. Another is that the borrower and his family ordinarily are able to contribute a substantial amount of labor, and a third is that in many cases borrowers have been able to utilize such materials as timber, sand, gravel or stone from their own farms or else obtain such materials from local sources at a low cost.

Low cost, however, does not mean low quality. Each of these homes is required to meet the construction standards of the Farmers Home Administration. These standards protect the borrower against faulty construction and the Government against an unsound investment. The standards are flexible enough to permit a farmer to use his skills and ingenuity to build at minimum cost the kind of a home of which he and his family are justifiably proud.

In addition to providing financing for farm homes, the farm housing program offers farm families an opportunity to build or improve service buildings needed to put their farms on a paying basis, and to operate them more efficiently.

A fourth of the farm housing funds have been used for purposes such as building dairy barns and milking parlors, general purpose barns, poultry houses and for installing water systems. While this has not been the largest field of activity of the housing program it has been a highly significant one. Through it some farmers have been able to put their units on a paying pasis; others have been able to make necessary changes in their farm buildings to meet the changing requirements of our present day agriculture; and others have needed to change their building facilities to use more efficiently their family labor and their land. The nature of the farming business-one in which the family home and income producing activities are inseparably joined-makes this authority an important phase of our farm housing program.

The level of living of farm families depends upon the productivity of their farm. When through the addition or modernization of farm service buildings farm families of moderate means, such as the ones to whom farm housing loans are made, are able to increase their income, they are better able to pay the cost of a decent home.

These housing loans to farm families who are unable to obtain their credit from the usual sources are sound investments. During the 4 years that the farm housing program has been in operation, borrowers have established a commendable repayment record. As of January 31 of this year, less than 5 percent of the borrowers had not paid in full the amounts that had become due on their loans. Approximately one-third had paid more than was due.

I am particularly proud of the repayment record established by the borrowers in Alabama. Of the almost 1,000 farm housing borrowers who had payments

due at the end of 1953, less than 1 percent had not paid the full amount due on their loan by January 31, 1953. These few are the families who did not have sufficient resources to meet the credit requirements of conventional lenders for a construction loan. However, as soon as they make sufficient financial progress to qualify for a loan from another source they will be required to refinance their Government loans with private or cooperative lending institutions. They only need adequate credit on reasonable terms and an opportunity to prove that they are good credit risks. When the construction work is finished and the loans become seasoned, private credit agencies can and will carry the remaining debt.

The farm housing program is not in competition with private and cooperative credit, but rather it is an integral part of our total credit system that will enable farm families to have homes comparable to those enjoyed by city residents. I think we will all agree that a high percentage of our city families are well housed today because they have been aided in their home purchase or improvement through Government financed, insured or guaranteed programs.

I take considerable pride in the fact that it was an Alabama World War II veteran who received the first farm housing loan made under the Housing Act of 1949. I wish all of you could have seen the transformation that took place on his farm when the ramshackle and dilapidated house that was too worn out to repair was replaced by a modern six-room home complete with running water, bath, and up-to-date kitchen.

Both the appearance of the farmstead and the efficiency of the farming operations were further improved by the addition of a new barn and the installation of a pressure water system.

All this was done with a $4,300 farm housing loan coupled with careful planning to use most advantageously the materials that could be salvaged from the wornout buildings that were replaced.

I mention this first farm housing loan because it is both a typical example of the shocking condition of many of our farm homes and a dramatic demonstration of how such a condition can be remedied by a soundly conceived and efficiently administered farm housing program.

Although the inadequacy of farm homes has been less conspicuous and perhaps less publicized than the slums in the cities, a far greater percentage of our farm families are living in substandard houses than is true of urban families. Nationwide 1 out of every 5 farm families is living in a house that is so dilapidated that it either needs to be replaced or else needs major repairs. In Alabama only 1 farm family out of 12 has the commonly accepted convenience of a private toilet, bath, and hot running water. One out of four families live in homes having less than four rooms. A high percentage of Alabama farm homes are not only inadequate, but 1 out of every 3 needs major repairs or needs to be replaced.

The economic and social problems associated with inadequate housing on a fifth of our Nation's farms are too great to be brushed aside. The idea that privation and hardship necessarily are a part of farm life was commonly accepted during the years when our country was being settled, but today farm families want, and I believe they are entitled to it, the same conveniences that city people enjoy.

Farm families for one reason or another frequently have deferred home improvements until they had paid for their farms. The idea has prevailed among both farmers and lenders that the house was something to be improved out of savings and that it wasn't prudent for the farmer to borrow to give his family a decent home. This postponement of home improvements frequently extended beyond the years of greatest family need-the years when the children were at home. Particularly during these years, the household duties of farm wives meant hard labor and drudgery without such commonly accepted conveniences as electricity, running water, and efficiently designed and equipped kitchens.

This postponement of home improvements was largely because of economic necessity and not by choice. All too frequently farm families never did accumulate enough money to build a decent home. The possibilities of obtaining a long-term amortized loan to build a new home were exceedingly scarce; consequently, many of these families were forced to patch and continue to live in rundown and inadequate homes.

Today, farm families no longer accept the notion that because they chose farming as a way of life they need to live in homes that are inconvenient and inadequate. To the extent that private and cooperative credit sources can meet the building credit needs of farm families they should be encouraged to do so.

Government loan guaranties and insurance have encouraged private capital to finance improved housing for our city families on a substantial scale. When private credit was not available direct Government loans have been provided. What farm families want and need is a like opportunity to finance farm building improvements.

The farm housing section of the Housing Act of 1949 gives this opportunity to the farm families who cannot obtain their financing from private or cooperative sources. The limited funds that have been made available under this act have proved its effectiveness in helping farm families of modest means improve their homes. We need to extend these authorities. They are an essential part of our national housing program which has as its objective the progressive improvements of our housing standards with the eventual realization of a decent home and suitable living environment for every American family.

Mr. JONES. Again let me state to the committee I appreciate the opportunity of appearing on behalf of rural housing. Thank you. The CHAIRMAN. Mr. Lantaff.

STATEMENT OF HON. WILLIAM C. LANTAFF, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF FLORIDA

Mr. LANTAFF. Mr. Chairman, I appreciate the opportunity of appearing before this committee to call to your attention a very small and somewhat minor bill that I introduced last year, pertaining to military housing. With it in connection with a work of which I am a member, we ran into quite a problem at various military installations with reference to the construction of bachelor officers quarters. Bachelor officers quarters cost approximately $240,000. Normally, that is one of the first things that is stricken from the appropriations bill. In many of our installations and bases there is a great need for these bachelor officers quarters, but as I have mentioned before, they cost some $240,000, and normally in an attempt to cut expenses the Appropriations Committee eliminates that item from the bill.

When Homestead Airbase was reactivated in Miami, Fla., on a permanent basis, 2 years ago, and construction was started there, the same thing happened. The bachelor officers quarters were eliminated, and I received letters from one or more individuals in my community suggesting that the title VIII provisions of the Wherry Act be extended to cover bachelor officers quarters.

The question was posed to me as to why private enterprise couldn't go in and build these BOQ's under the provision of title VII of the Housing Act, on the same way that multiple-family housing was being constructed, and that private enterprise was willing to do the job and it would save the Government having to appropriate that money in the public-works program of the military budget.

I then took that idea up with the Air Force, because the Air Force was involved at the Homestead Airbase, and the Air Force said that no particular thought had been given to it, but about a month later came back and said there was no reason why it couldn't work. The only minor objection that they had to it was the fact that if the BOQ requirements, on a base, dropped under the officers' requirements for BOQ quarters, that there might be a problem of renting to civilians on the base or outsiders. But they thought that the advantages to the Air Force of being able to go ahead with their BOQ program, utilizing private enterprise, would more than outweight those advantages.

And so this bill which you have before you, H. R. 6667, was actually prepared for me by the Department of the Air Force.

I talked with some of the officials in the Air Force this morning, as to whether or not they had any change of heart about this particular bill, and they said no, that they thought it would be a very helpful amendment to the title VIII of the bill.

That, Mr. Chairman, is about all there is to that bill. I think that it will enable private enterprise, however, to construct a needed facility for the Air Force without the requirement of our having to appropriate approximately $240,000 per BOQ, which, as I pointed out, is always stricken from the appropriation bill, and that is one of the great needs of all the services today.

Mr. BETTS. Did you say $240,000?

Mr. LANTAFF. The cost varies. That is about an average cost for a 40-unit bachelor officers' quarters.

The Secretary of Defense, as I recall it, has stated that the cost per unit should not exceed $6,000. In this bill, it states $9,000 per unit-up to $9,000 per unit-which, as I recall it, is the same per unit cost authorized for the multiple family housing.

The CHAIRMAN. Thank you, Mr. Lantaff.

Mr. MULTER. Mr. Chairman.

The CHAIRMAN. Mr. Multer.

Mr. MULTER. Mr. Lantaff, I am sure we appreciate your calling this to our attention. But tell me, are there any parts of the country where the cost of the unit may run as high as $9,000? I am not talking now about Alaska or outside of the continental United States, but within the United States; are there any areas where it would run that high?

Mr. LANTAFF. No, sir. I think, in fact, that the $9,000 figure is an outside figure. The $9,000 figure was used to track the other provisions with reference to multiple-family housing.

Actually, the most expensive bachelor officers' quarters that we ran into was out at El Toro Air Force Base, Calif., where the cost was $7,076 per man.

After our report the Secretary of Defense issued a directive that no bachelor officers' quarters housing would be approved which exceeded the cost of $6,000 per man.

Mr. MULTER. Thank you.

The CHAIRMAN. Thank you very much for being here, Mr. Lantaff. Mr. LANTAFF. Thank you, Mr. Chairman.

The CHAIRMAN. Mr. Watts.

STATEMENT OF HON. JOHN C. WATTS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF KENTUCKY

Mr. WATTS. Mr. Chairman, members of the committee, I appreciate the opportunity of appearing before this committee for a short time this morning. I am here in support of H. R. 7743, which I introduced in the House, and S. 2937, which was introduced in the Senate by Senator Sparkman, and which passed the Senate on March 1, 1954. These 2 bills are identical except in 1 minor particular, in that they seek to amend section 15 of the United States Housing Act of 1937.

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