in Social Security benefits. The first portion of this increase was effective the first of this month and the remaining 4 percent will be visible in your July checks. At the same time Congress passed similar increases in veterans' pensions, Civil Service and railroad retirement benefits. While far from adequate these measures only serve to keep the elderly even with increases in the cost of living occasioned by the present runaway inflation.

RAPIDLY RISING PROPERTY TAXES

Third, there is the problem of property taxes and the elderly. Rapidly rising property taxes are almost confiscatory in some States. For example, the Committee on Aging has documented instances where individuals were paying as much as 50 percent of their annual income in property taxes. An individual might have an annual income of $1,000 and pay $500 in taxes. Some 29 States have already enacted legislation to exempt the elderly from such taxes in proportion to their incomes. I have introduced my own bill, S. 1958, which is pending before the Senate Finance Committee.

Fourth, there is also a problem of housing. Housing is the largest single expense for the elderly. More than a third of the budget of our over-65 individual goes to pay for housing. Some 30 percent of our 20 million older Americans live in substandard housing-that is, without electricity or plumbing or other necessities. How to solve this problem is a topic very much under debate in Washington.

The Nixon administration has decided to limit sharply Federal housing subsidies to the elderly. The details of this move are not clear. Nevertheless, the approach is to remove Government from the housing field as much as possible. This, I believe, would be a grave mistake. I favor a loan program myself the type of program we had until the Nixon administration took over in 1969.

Under this program, church groups and nonprofit sponsors could borrow funds at 3 percent interest directly from the Government if the funds were used to provide housing for the elderly. This so-called section 202 program was the most successful housing program we ever had, providing thousands of units specifically designed for the elderly. It operated 10 years without a failure or foreclosure. It is a mystery to me why the Nixon administration decided to phase it out. I believe that they should reconsider.

For my own part, I have introduced a bill, S. 1997, which is designed to get private enterprise involved in designing and providing housing for our elderly at low rents. Essentially my bill sets up a design contest. It employs the total-living environment concept. The three best designs submitted would be funded and become prototypes for further construction. I call the bill "Campuses for the Elderly." Under the provisions of this bill, all types of housing from board and room right through nursing home care would be provided in one general area adjacent to a senior citizens center which would also provide outreach services to the community. One successful model exists in Syracuse, N.Y., where such housing for the elderly is built adjacent to the university campus. Senior citizens have the benefit of the university facilities and may even find part-time employment or attend classes.

Students have greater exposure to the older members of society

which promotes understanding. This would be a very helpful and progressive type of development to promote.

TRANSPORTATION FOR OLDER AMERICANS

Fifth-and one of the greatest problems-is transportation for older Americans. As some of you might know, there are several bills pending before the Congress to authorize reduced rate transportation on mass transit for senior citizens. Some 60 cities now feature such reduced fares on their buses and subways. I have cosponsored such legislation. In addition I have for years been the sponsor of legislation to provide reduced fares for senior citizens on the airlines. The bill was passed by the Senate last year but lost in conference with the House. This year the Senate again passed the bill. Hopefully, the House of Representatives will act favorably on this proposal some time this year.

NURSING HOME PROBLEMS

Sixth, there is the special problem of nursing homes. Earlier I pointed out that Medicare does not cover nursing home benefits to any significant degree. I told of the increasing numbers of elderly and suggested the concomitant increase in disability. It is a fact that the older you are, the more chance there is you will have some sort of disability. Individuals in nursing homes average 82 years of age, and have three or more major disabilities. Obviously, more and more individuals will need nursing home care. It is, therefore, incumbent upon us not only to enact legislation to help pay for nursing home care but also to insure that the best quality of care is provided by these facilities.

Many nursing homes are providing fine care. We seldom hear about them. We always hear about those that are doing a poor job-the ones that neglect patients or engage in penury or profiteering. During the past 11 years my Subcommittee on Long-Term Care has held hundreds of hours of hearings and labored to improve the quality of care provided in this industry.

We will soon release an exhaustive study of nursing home problems which it has taken us 5 years to compile. The report will conclude that we need to find ways to get the medical profession more interested in the care of the aged; that we need to provide training for nursing home personnel; that we need to enforce standards of care and to pay the nursing home operator a fair rate of return.

I have already introduced many of the report's recommendations in the form of bills which are pending before the Congress. It is my hope that when enacted these bills will result in a substantial upgrading of the quality of care of nursing homes. We have already come far in this regard, but we still have a long way to go.

In summary, let me remind you that the major problems which confront the aged are, after all, the same problems which confront all people problems of health, of housing, of income, and of transportation. The thing which makes them more brutal for the elderly is that they come in a distorted and amplified form at a time of life when people have the least strength and ability to deal with them.

In the years we have been trying to help the elderly find solutions to these problems, there has been an increasing awareness among the remainder of our population of the plight of our older Americans. We

have seen some progress made toward solving the most overwhelming of the elderly's dilemmas. We can therefore end this talk on an optimistic note.

Hopefully, the day is not too far distant when those in the last third of life can enjoy their remaining years to the fullest without worry and concern. This should be the legacy of years of contribution to the building of a nation. With your help perhaps we can make this vision a reality, if not for ourselves, then for our children and grandchildren. [Applause.]

I do appreciate your attention to that overly lengthy introduction to the subject matter, but I wanted to place it before you, because this is the area in which we have been working for many, many years, and again I give Val Halamandaris credit for compiling this nursing home report which will be released shortly. It has been a monumental effort. I will now call the first panel of witnesses: Sterling Peterson, Assistant Regional Commissioner of Social Security, from the Denver Regional Office, who will give you a few words about Social Security, and then we will hear from Jack Walsh of the Bureau of Supplemental Security Income who will speak on the new Supplemental Security Income program.

After their presentations, the members of the audience may address. questions to them. Accompanying them to help answer the questions are E. Donald Davis, associate regional representative, Bureau of Disability Insurance; Don Donaldson, district manager, Social Security Office, Provo, Utah; and Walter D. Mackey, operations supervisor, Social Security Office, Provo, Utah.

We will first hear from Sterling Peterson.

STATEMENT OF STERLING K. PETERSON, ASSISTANT REGIONAL COMMISSIONER, SOCIAL SECURITY ADMINISTRATION, DENVER REGIONAL OFFICE; ACCOMPANIED BY JOHN F. WALSH, JR., SENIOR PLANNING OFFICER, BUREAU OF SUPPLEMENTAL SECURITY INCOME; E. DONALD DAVIS, ASSOCIATE REGIONAL REPRESENTATIVE, BUREAU OF DISABILITY INSURANCE; DON DONALDSON, DISTRICT MANAGER, SOCIAL SECURITY OFFICE, PROVO, UTAH; AND WALTER D. MACKEY, OPERATIONS SUPERVISOR, SOCIAL SECURITY OFFICE, PROVO, UTAH

Mr. PETERSON. Thank you very much, Senator Moss. I have a bad habit, ladies and gentlemen, of digressing from my notes. I trust I will not digress too much, Senator.

I was most pleased, and I am digressing already, I was most impressed to hear your account of problems that elderly people are facing. I say this with the greatest of sincerity, Senator, despite having some prejudice, as a Richfield, Utah, native, who has been trying to get back there for the last 23 years, and I hope to make it some time. That Senator Moss, and I have heard many discussions, many reports on problems of the aging, but I think the Senator identified in a very clear and very succinct way the same problems I would identify as the most critical areas that elderly people are faced with today.

I commend you, sir.

President McDonald, we very much appreciate this opportunity to be in these lovely surroundings, and exchange information with you and the people from the four-county area. We are grateful for, the help Dr. Selman gave us in preparing for this seminar.

I think of all of us and all of you as fellow pioneers. I use the word pioneers because I believe everyone here is anticipating, as evidenced by the Senator's comments, a new era for the elderly, a new era that we have waited for a long time, in which we hope to see the reintegration of older people into the mainstream of our society.

Moreover, I think we are all dedicated, we in the Social Security Administration, to developing and implementing programs that will help make the later years of life truly golden and significant and important, programs that will provide the opportunity for the large numbers of older persons who are eager and able to give creatively, an opportunity that is too frequently lacking, in my judgment.

Although Social Security occupies only a small part of this hearing, of this conference, we have some of our region's most expert technicians with us today. The Senator identified them. They are all sitting to my right. Thank you, gentlemen, for joining us.

I will hasten to add that we do not intend to overburden you with Social Security nor monopolize this conference.

SOCIAL SECURITY-A HOUSEHOLD WORD

Social Security to me is sort of a household word. Many people know in a general way what Social Security is all about. We would be very willing and happy, as the Senator indicated, to answer your questions, your general questions. Although Social Security cannot

guarantee the coming of this golden era for all of the older people, the benefits of Social Security can contribute to a goal recently expressed by the American Medical Association, and I quote, "That of making the aging experience a cause for national celebration, rather than the national disgrace that it is today."

I would like, therefore, to give you a brief overview of the Social Security program as it operates now with particular emphasis on its operation in Utah, and more specifically on the Social Security impact in Grand, Emery, Carbon, and San Juan Counties, the area in which most of you are concerned.

When the average person thinks of Social Security, he thinks of retirement insurance, but the program has grown through the years to meet or attempt to meet many replacement income needs with increased benefits and increased contributions to keep pace with spiraling living costs.

I am reminded when we talk about living costs and inflation, of a story I heard at a luncheon the other day in Denver.

It is about a dog, a boy, and a banker. The banker was on his way to the office, and he customarily and traditionally walked about the same way from his home to the office. As he was going down the street on a nice, bright, warm day, rather early in the morning, he noticed a young boy on the sidewalk with a sign, "Dog for sale."

The banker stopped. "How much would you charge for the dog,

son?"

"$20,000."

The banker said, "That is incredible. That is rather expensive. Do you hope to find a customer that will pay $20,000 for your dog?" "Oh, yes, I do not think I will have a bit of difficulty."

"Will you accept cash, or will you go on the installment basis?" "Oh, I would prefer to have the money right away." The banker said, "I am sorry, I cannot buy your dog."

That evening, as he was walking home on the same route, he noticed the same boy, and the dog was gone. The sign was gone. He stopped, and he said, "Well, apparently, young man, you sold the dog. I am amazed. Did you get full payment?"

"Oh, yes, I traded the dog in for two $10,000 cats.”

In 1940, when only employed workers in commerce and industry were covered under Social Security, the employer and the employee each paid 1 percent on a $3,000 annual salary base.

The maximum benefit in 1940 for a worker retiring at age 65 was $40 per month. Through the years, the coverage has expanded, and today almost every category of employed and self-employed persons is included within the Social Security benefit program, but there are other changes.

This year, 1974, the annual wage base salary is $12,000. The maximum benefit for a retired worker at age 65 is $286.80, about a 700percent increase over 1940.

On the other hand, the contribution of both the worker and his employer has risen almost 600 percent since 1940.

Last year some 109,000 persons in Utah received a total of $198 million in Social Security benefits. In Carbon, Emery, Grand, and San Juan Counties, approximately 6,000 persons received about $685,000 a month in Social Security benefits. Considering the total population