Hon. ROBERT F. WAGNER, STATE OF ARKANSAS, Little Rock, November 28, 1947. United States Senator, Washington, D. C. DEAR SENATOR WAGNER: This will acknowledge receipt of your letter of November 24 relative to your questionnaire on housing and urban redevelopment. The 1945 Housing Act to which you refer is act 212 of 1945 which so far as I know has not operated and for which there has been no appropriation made. I therefore count it as of no effect and certainly do not think that it woud help solve the housing problem in our State. Yours very truly, Senator ROBERT F. WAGNER, Committee on Banking and Currency, BEN LANEY, Governor. OFFICE OF THE GOVERNOR, Atlanta, Ga.. December 2, 1947. United States Senate, Washington, D. C. DEAR SENATOR WAGNER: Since receiving your letter of October 10 asking for a report from Georgia to your Joint Committee on Housing, we have endeavored to work out answers to all of the questions propounded in the questionnaire attached to your letter. The delay in complying with your request has been occasioned by the tremendous amount of business in this office and to the necessity for considerable traveling on the part of officials with whom I wished to confer before making a definite reply to you. Attached is the information covering the situation in this State. Sincerely yours, M. E. THOMPSON, Governor. 1. (a) There is no doubt that while private enterprise today is finding the opportunity through shorter profits to reach lower in the field of housing individuals, still it cannot now or ever reach sufficiently far enough to adequately house the lowest income groups who now live in slums in our towns and cities, and maintain the profit motive. (b) The above opinion is based upon actual surveys by those interested in housing in this State and statements by many real estate men themselves. Also, upon the fact that in a good many instances, projects of slum clearance in cities and towns have been submitted to private capital with the request that they ascertain their ability to solve the problem and in each instance their answer has been that they could not. 2. (a) The public housing projects which have been built in Georgia have proved conclusively that publicly assisted low-rent housing is the only feasible means by which families of the lowest income groups can obtain decent housing. (b) The cities and towns of our State are in the position that they can only participate in the capital cost of low-rent housing through the medium of normal improvements such as streets, sewers, water, etc. (c) Because of the financial status of our cities and towns and anticipated revenues, there is but one method through which they can participate in annual subsidies needed to permit low-rent housing and that is by tax exemption. (d) There are not now, nor is it anticipated there will be in the near future, any State loan or subsidy funds available for the above purposes. 3. (a) The low-rent housing program as initiated under the United States Housing Act of 1937, while it has made some mistakes in its pioneering course, has, I believe, rendered a tremendous contribution to the general economy of living standards of America and has transposed a group of people who were a financial burden upon the public treasury, into a group of stabilized citizens who are distinctly an asset to the community. Therefore, I, without equivocation, make the statement that I favor a continuation of this program. (b) In general I am in accord with the provisions of the Taft-Wagner-Ellender bill which is now pending in Congress. 4. (a) The State of Georgia has passed its own laws to put their municipalities in position to participate in the urban-redevelopment program when such a program is initiated by the Federal Congress. I believe that this would be one of the most important steps that could be taken in the achievement of eradication of slums. (b) I do not believe that the urban-redevelopment program can alone accomplish the clearance of slums in the blighted areas, but as stated above, it can render an important contribution to eradication as part of an over-all program. (c) The main reason that urban redevelopment cannot in itself eradicate slums in blighted areas is that while it can clear these areas it cannot provide necessary housing for the displaced families. You cannot cure slums by merely clearing the present areas and compel displaced families to start the creation of new slums because of their inability to meet economic rents necessarily established through the profit motive of private enterprise. 5. (a) and (b) I am putting these two paragraphs together because I am of the opinion that our municipalities can meet their financial responsibility in this urban-redevelopment program to the extent set forth in Senate bill 866, but I doubt their ability to go beyond this figure. 6. It is necessary that a comprehensive low-rent housing program be in existence before urban redevelopment is applied in order that there can be an equitable transition of displaced families into new housing units. Housing is today and will, I believe, for many years be in a limited position to meet needs, and should the additional emergency needs be placed upon the municipalities by application of urban redevelopment without the offsetting low-rent housing program, these displaced families would be without a place to turn to find living units. 7. Georgia being predominantly an agricultural State, I am naturally vitally interested in carrying the low-rent housing program beyond urban communities and into rural areas both farm and nonfarm. Many people do not realize that there exists proportionately in the rural areas worse conditions of housing than exists in the slums of the large cities. No housing program can be completely adequate without an equitable inclusion of a solution to the problem of the rural areas both farm and nonfarm. Hon. ROBERT F. WAGNER, THE COMMONWEALTH OF MASSACHUSETTS, Joint Committee on Housing, Senate Office Building, Washington, D. C. DEAR SENATOR WAGNER: Your letter has been received, and I am glad to participate in your survey of urban redevelopment and public housing. My answers to your specific questions are as follows: 1. (a) No. (b) New construction is not providing any help for low-income families living in slums or other substandard housing. 2. (a) Yes. (b) They are not in position adequately to finance such cost. (d) The State has agreed to reimburse municipalities for one-half the deficit incurred by them in operating moderate rental housing for veterans for 5 years and then selling them and from their sale thereafter with a maximum contribution by the State of not more than 10 percent of the original cost of construction. 3. (a) Yes. (b) Construction cost limitations should be increased. There should be more liberal payments made to municipalities in lieu of taxes. (c) Possibly the functions of the Federal Public Housing Authority could be taken over by State boards. 4. (a) Despite amendments adopted this year to provide better utilization of Federal Housing Administration financing, only one application has been received by the State board of housing up to the present time and the completion of even this project seems doubtful. (c) No alternative proposal to suggest. 6. By constructing the first development before any area is cleared and giving priority in occupancy to the families then living in the first area to be cleared and continuing this process until all areas have been cleared and their occupants rehoused. 7. The providing of low-rent housing is one of the most important problems facing the United States today and required immediate and forceful action. Due to the magnitude of the problem, I believe that the funds should be provided by the Federal Government, supervision first by the State and actual operations carried on at the local level. Sincerely yours, Hon. ROBERT F. WAGNER, ROBERT F. BRADFORD. STATE OF MINNESOTA, Saint Paul 1, November 3, 1947. Senator, United States Senate, Washington, D. C. DEAR SENATOR WAGNER: This will acknowledge your letter of October 10, 1947, in which the Congressional Joint Committee on Housing of which you are a member, requests our observations on the broad question of redevelopment and slum-clearance problems in the State of Minnesota. It has been my privilege to participate in the development of housing and redevelopment legislation in Minnesota which for the first time establishes a comprehensive State housing and redevelopment policy. The Municipal Housing and Redevelopment Act is an enabling measure authorizing cities to create housing and redevelopment authorities with broad powers to clear slums and provide lowrent housing and redevelopment areas for all kinds of housing and commercial and industrial uses. My interest in slum clearance and redevelopment goes back many years since I not only sponsored the present State Municipal Housing and Redevelopment Act, which became effective in April of this year, but I was a sponsor in 1935 of the only slum-clearance project we have in the State. Coming at the present time when future Federal housing policy has not been established and being an original housing measure in this State, the Municipal Housing and Redevelopment Act declares our housing policy. Accordingly, may I commend to your committee a careful examination of the Minnesota Housing and Redevelopment Act if you wish to obtain a statement of Minnesota housing policy as declared by the State legislature. A copy of the act is transmitted herewith. Since the Municipal Housing and Redevelopment Act enables cities to undertake slum clearance and redevelopment and to participate in any benefits made available under correlative Federal legislation dealing with the problem, it is our view that the legislature has recognized that Federal action in the field of slum clearance may be required. It was one of the purposes of the enactment of the State measure to put the State in a position to participate in any such Federal aids. It is our view that the Congress should do all things necessary to get housing action started now and to start sound permanent slum-clearance housing and redevelopment projects in the right direction without delay. We were pleased to learn that Senator Robert A. Taft, one of the other sponsors of the comprehensive housing legislation to which you refer in your letter has stated on his recent western tour that the Congress should consider and enact housing and slum-clearance legislation. The Minnesota delegation to the recent American Legion convention voted unanimously to approve the Taft-Ellender-Wagner housing and redevelopment bill. In suggesting that you give special attention to the Minnesota Housing and Redevelopment Act, allow us to point out that the Minnesota act is not the same in all particulars with such enabling legislation of other States. A veteran's preference must be provided under the State act, a gap of 20 percent must be left for rents charged in slum-clearance projects and rents in other accommodations. Only families in the lowest 20 percent of the income group may be served by slum-clearance projects. Tenancy is limited to a period of 4 years in order to achieve rehabilitation. By an amendment after the introduction of the original housing and redevelopment legislation, slum-clearance housing projects can be undertaken by a community only after a referendum on the question. Public housing should be forced progressively lower by the expansion of good low-cost private housing. Under any Federal housing legislation presently existing or to be enacted, greater autonomy and independence of judgment should be given to local communities and to the States. The past paternalistic practices of national housing agencies should have no place in a national housing program. The Federal Government should discharge its legal responsibilities enacted by the Congress and provide national leadership in improving those phases of the constructing industry that must be attacked on a national basis. In reply to the specific inquiries attached to your letter, there is transmitted herewith a statement prepared by the State division of housing and redevelopment in the department of administration. Separation of the national housing problem into an immediate action program which legislative investigating committees can properly handle and an over-all investigation into every phase of the construction industry calling for an independent scientific investigation of housing problems would appear to present a common meeting ground for proponents and opponents of present housing legislation. Only by action tending to eliminate inefficient practices in all phases of the industry will it be possible to achieve decent housing for all people without the subsidies which now perpetuate the practices we all wish to eliminate. Experience in 1946 has conclusively proved that necessary housing cannot be achieved by regulation alone even though those regulations are designed to protect the people most in need of housing at rents and prices they can afford to pay. Nor can a long-term policy of subsidizing practices continuing the very evils that must be eliminated be accepted as the definitive answer to the housing problem. Regulation that does not have for itself reasonably foreseeable purpose, the elimination of uneconomical practices preventing efficient operations in a free economy tends toward bureaucracy. Emphasis on any long-range housing program must be to establish a positive program leading to a national framework that will permit private enterprise in a free economy to produce housing for all income groups. Until this can be accomplished, continuation of a subsidized program on a provisional interim basis is required.. Sincerely yours, LUTHER W. YOUNGDAHL, Governor. SURVEY OF URBAN REDEVELOPMENT AND PUBLIC HOUSING 1. (a) In your opinion, based on your knowledge of conditions within your State, will private enterprise be able now or in the foreseeable future to provide decent housing, new or old, for all low-income families now living in slums or other substandard housing, at rents or prices within their ability to pay? No. (b) Please indicate, briefly, the basis for your opinion. Transmitted herewith are tentative surveys in four Minnesota cities which may serve as a spot check of general conditions. The need for housing is well established but the great need is for housing renting or having a carrying charge of less than $45 per month. Privately financed housing at the present time is selling for upward of $10,000. The following is a quotation from a statement of George M. Shepard, city engineer of St. Paul, before the United States Chamber of Commerce on September 11, 1947, in Washington, D. C., and appearing in the October 1947 issue of Minnesota Municipalities: "I would like to suggest certain long-range planning activities which should be given particular study by planning commissions or boards. "1. Replanning of blighted or decadent residential areas. "2. Provision for adequate housing in areas convenient to employment centers. "3. Creation of adequate educational and recreational facilities in such residential areas. "4. Restudy of zoning with a view of eliminating encroachment of commercial and industrial uses into residential areas. "5. Cooperation with the proper operating agencies in the planning of a comprehensive street and highway system to serve the present and future traffic needs of the city. "Those of the above items which involve participation by the city, State, or Federal Government in housing are still quite controversial in nature in many localities. It is being more and more realized, however, that the provision of adequate housing in substitution for the substandard housing now existing in most of the blighted areas is a major step in the improvement of our cities. This cannot be done entirely by private initiative. Local as well as State and Federal financial assistance will be required." 2. (a) If it is your opinion that private enterprise will not be able to provide decent housing for all such families, do you favor the provision of publicly assisted low-rent housing for such families? The policy of the State of Minnesota, as declared by the State legislature in the Minnesota Municipal Housing and Redevelopment Act, enables cities to undertake publicly assisted low-rent housing. Responsibility for determination whether such housing should be undertaken rests with the communities. As sponsor of the State act, the provision of the publicly assisted low-rent housing under present conditions is justified. (b) To what extent are the cities in your State in a position to finance the cost of constructing such low-rent housing? Financial structures of our cities do not permit financing low-rent housing. (c) To what extent are cities in your State in a position to furnish annual subsidies needed to permit such housing to be rented to such low-income families at rents within their ability to pay? Cities are not financially able to furnish annual subsidies for low-rent housing nor are they authorized to furnish such subsidies under the State Housing and Redevelopment Act. (d) To what extent are State loan and subsidy funds available for such purposes? State loan and subsidy funds are not available for such purposes. 3. (a) Do you favor a continuation of a program of Federal assistance to local communities, along the lines of the United States Housing Act of 1937, as a means of aiding the communities to provide decent housing for low-income families? The Municipal Housing and Redevelopment Act contemplates the continuation of Federal aid program in order for it to be effective with respect to low-rent housing. (b) Have you any modification in that program which, in your opinion, would make it more effective, or would make it more adaptable to conditions in your State? The The cost limitations on construction should be increased realistically. recent amendment requiring cities to contribute development-cost funds is undesirable. (c) Please outline briefly, and describe the practical effect of, any alternative proposals which you desire to recommend as a feasible means of meeting this phase of the housing problem. Limited dividend housing, redevelopment housing, and moderate rental housing are discussed in the attached bulletins of the State division of housing and redevelopment. If housing is to be provided now for families in the lowest income group, a national-housing program involving financial assistance will be required. 4. (a) Please describe briefly the results achieved or in prospect under the urban redevelopment legislation of your State. Several Minnesota cities are developing plans for redevelopment projects in accordance with the attached suggested community-housing program. It is recognized that this program is the best possible one permissible under the State legislation but would be much more effective if there were a national housing policy on the subject. (b) In your opinion, under this legislation alone, will the cities in your State be able effectively to accomplish in full the clearance and redevelopment of their slums and blighted areas? Slum clearance and redevelopment would be speeded with Federal funds. However, the Minnesota act provides means for local financing. (c) Please indicate briefly the basis for your opinion. The financial structure of our cities at the present time justifies the use of outside financial assistance. 5. (a) To what extent are your cities in conjunction with the State government in a position to finance the write-off of excessive costs of acquiring and clearing slums and blighted areas if this land is to be made available at prices permitting its redevelopment for the uses which your cities determine are most appropriate? A study of the Municipal Housing and Redevelopment Act will indicate how cities may accomplish such write-down. However, the total amount of write-down and necessary supplementation of funds required under present conditions to get projects started in the right direction can only be known in connection with specific projects under known construction conditions. It would appear that very large amounts of financial aid will be required under present conditions. (b) S. 866, now pending in Congress, proposes that two-thirds of the net cost of local urban redevelopment programs be carried by the Federal Government and |