HOUSING

THURSDAY, MARCH 20, 1947

UNITED STATES SENATE,

COMMITTEE ON BANKING AND CURRENCY,

Washington, D. C. The committee met at 9:30 a. m., pursuant to recess, in room 301, Senate Office Building, Senator Tobey (chairman) presiding.

Present: Senators Tobey (chairman), Buck, Flanders, Bricker, McCarthy, Maybank, Taylor, Fulbright, Robertson, and Sparkman. The CHAIRMAN. The committee will come to order. Mr. Ketchum?

STATEMENT OF OMAR B. KETCHUM, DIRECTOR, NATIONAL LEGISLATIVE SERVICE, VETERANS OF FOREIGN WARS OF THE UNITED STATES

Mr. Omar Ketchum, director of the national legislative service of the Veterans of Foreign Wars. We are glad to have you with us. Mr. KETCHUM. Thank you, Mr. Chairman.

I should like to have the privilege of presenting, just so the committee may know him, our national American housing officer, Mr. Wesley D. Pearce.

I would like to present to the committee our national housing officer, Mr. Wesley D. Pearce.

Mr. Chairman and members of the committee, I am grateful for this opportunity to present the views of the Veterans of Foreign Wars with respect to the bill, S. 866, which we believe establishes a sound, comprehensive, national housing policy and program.

Some of the members of this committee may recall my testimony before the committee in December 1945 in support of the bill S. 1592, Seventy-ninth Congress. The bill presently under consideration retains the principal provisions of the former bill.

I wish at this point to advise that the Wagner-Ellender-Taft bill of the Seventy-ninth Congress was endorsed by the forty-seventh national encampment, Veterans of Foreign Wars, held in Boston in September 1946, and that the endorsing resolution petitioned the President to call a special session of the Congress to consider the bill. We are hopeful that this committee and the Congres swill expedite action on this measure so that this Nation can set about doing a job that has too long been left undone.

In the spring of 1946 our organization was heartened by the passage of the Veterans Emergency Housing Act. Since that time we have witnessed with anxiety the ceaseless bickering, name calling, recrimination, and "loopholing" that has made a molehill out of what we

had been led to believe would provide a solution to a housing problem which was essentially a national emergency.

Millions of veterans today recall how a magnificent American ingenuity and engineering skill placed in their hands a military machine which exceeded their wildest imaginations. These same veterans today stand as mute witnesses to an apparent break-down of this phenomenal industrial potential when it comes to the building of homes-decent homes that the average veteran can afford to buy or

rent.

The veterans decried the emergency-and the President declared a housing emergency. The veterans asked for controls and got controls. But in all this there was one important factor, dormant but very pertinent. A highly complex long-range problem, affecting the basic needs of a great majority of the people, was groping for solution through the medium of temporary halfway legislation.

For example, the emergency housing program was designed to speed up the flow of materials to houses for veterans-but there was no machinery for bringing down the cost of houses to the veterans' economic level. The Veterans of Foreign Wars had already reached the conclusion that the housing emergency would not be solved until a national housing program had been developed as part and parcel of a national goal to provide a decent home and suitable living environment for all its citizens.

The opposition to the Veterans Emergency Housing Act was a vociferous and powerful one. This opposition was kept alive by the comforting thought that it was all a matter of temporary controls and if the controls did not work-or if they were caused not to workout the window they would go. That is why it is important to us that this comprehensive legislation be enacted into law-that is why it has for over a year been part of our national housing program.

The details of S. 866 have already been presented to the committee and I do not propose to go into a repetition of what the various titles and sections purport to accomplish.

The Veterans of Foreign Wars is confident that title V, which expands the authority of the Federal Home Loan Bank Administration and the Federal Housing Authority, will permit a much wider participation by the veteran in the loan provisions of the GI bill of rights. We commend to you the plan set forth in title VI which is designed to assist private enterprise to serve the middle-income families. The more liberal home financing-95 percent of cost; 30 years to pay; 4 percent-have long been an objective of the Veterans of Foreign Wars.

The assistance to private enterprise for the construction of rental or mutual-ownership housing projects-90 percent insured loans; 40 years to pay; at 4 percent-should stimulate the construction of multiple dwellings.

It is estimated by us that the combination of the above liberal financing and home ownership provisions will achieve a monthly cost to the veteran of not to exceed $50 a month even during a period of abnormal costs.

The yield insurance for rental housing should, in our opinion, go far toward the solution of the most vexing problem facing the lowincome veteran whose greatest need at this time and for many years to come will be low-cost rental housing.

In our opinion the above incentives to rental housing will stimulate a large volume of such housing in the area between $30 and $50 per month.

Another group of veterans-those who cannot pay more than $20 to $30 a month for housing is definitely the impossible man for private enterprise. For these veterans the locally administered public low-rent housing to be constructed over a 4-year period, with preference to veterans, is especially commendable.

There are two suggested amendments which we would like to offer and which we believe would materially strengthen this bill; first, with respect to veterans and second with respect to an immediate attack on the housing shortage. The suggested amendments are as follows:

(1) Amend section 1201 (c) under title XII, page 104, to provide a specific top priority for veterans or veterans' cooperatives to purchase Government-owned permanent war housing development at a fair value on a negotiated bid.

The Federal Public Housing Administration, in the sale or disposition of Government-owned permanent housing, has apparently established a policy of giving preference or priority in purchase to present occupants, irrespective of veteran or nonveteran status. We believe that veterans should be given the first opportunity, either as individuals or in cooperatives, to purchase these properties.

Senator MCCARTHY. May I interrupt there?

The CHAIRMAN. Yes, sir.

Senator MCCARTHY. Mr. Ketchum, in connection with what you have to say, I believe the FPHA you mentioned have a priority that runs like this: No. 1, priority to the municipality in case they care to by the project?

Mr. KETCHUM. That is right.

Senator MCCARTHY. No. 2, to the present occupants. No. 3, sort of a fictitious priority to veterans. We find, however, that there is another system of priority that works through this whole priority system. They have been attempting to dispose of the projects built under the Lanham Act, on a sort of cooperative basis. In other words, sell the property to the occupants. The occupant would never get title, but would have a permanent interest in the property. They have been offering loans that are very inviting if the purchase is made on that basis, making it very difficult, however, to buy the property. The veterans' priority which is No. 3 along the line means nothing at all. In fact, the present priority of present occupants means very little unless he wants to go into a cooperative system of buying. Bear that in mind.

Mr. KETCHUM. I appreciate that very much. However, there are a few of these properties that do lend themselves to purchase by individuals, where they are of such a nature, in individual communities. That is why I mentioned preference to veterans or veterans' cooperatives, because there may be instances where a veteran could purchase an individual unit within one of those housing projects.

Senator MCCARTHY. I was not going into the merit of your thought at all. I was merely pointing out to you what has presently happened to the war housing.

Mr. KETCHUM. I understand and I appreciate that.

To obtain such a preference it will be necessary for the Congress to

incorporate said preferences into the law itself. We know from experience that preferences will not be forthcoming otherwise.

(2) Incorporate in S. 866 as a new title or titles the provisions of S. 701, which would amend the United States Housing Act of 1937, as amended, by adding title I after the enacting clause and by adding a new title II. S. 701 is a bill to assist in the immediate alleviation of the critical shortage of moderate rental housing for veterans.

We believe that the addition of the provisions of S. 701 will insure the immediate construction of multiple housing rental developments throughout the Nation at a price the average veteran can afford to pay. A recent survey on veterans' housing needs, undertaken by the Veterans of Foreign Wars, indicated that the average income of veterans is less than $2,400 per year.

We found that 39 percent of the veterans share living quarters with other families; 6 percent live in basements or attics; only 50 percent have a private shower or bath; and only 59 percent have refrigerators. Over 81 percent of the veterans who were surveyed want to remain in their home communities. It seems to us that the Nation could well take heed of these findings and make sure that veterans are encouraged to remain in their home communities, are adequately housed and employed, and reasonably content.

On behalf of the Veterans of Foreign Wars I want to thank you for the opportunity to appear before your committee.

The CHAIRMAN. Mr. Ketchum, as to that recent survey that you refer to in your last paragraph, how general is that? Is that a check plot system or cross section of the country? To what extent did it cover the country?

Mr. KETCHUM. We made the survey through all of our States, butI will not say that in each State they made an entire survey of all the veterans. It was a spot check survey made by the individual posts in the various communities. We have made those findings particularly in one or two various States.

The CHAIRMAN. You have made your position known to us in favor of this legislation. This is not testimony. This is just talk across the table. As I understand it, perhaps I am incorrect, I hope I am, the American Legion is not taking the position you take, is that correct?

Mr. KETCHUM. I could not answer for the American Legion, Senator. I do not know what their policy is. There has been some dispute over it.

The CHAIRMAN. The American Veterans' Committee are in favor of this legislation.

Mr. KETCHUM. It is my understanding that they are, yes.

The CHAIRMAN. I have been told but I have not had it confirmed yet that the American Legion has not taken a position in favor of this legislation. That, of course, would seem to me unfortunate because you have got a great body of veterans who are veterans before any other organization and their needs are paramount before any other organization.

What we are considering here is human needs rather than what organization a man belongs to. I hope I am incorrect. I believe the cause as you state; that being so I want to see all veteran agencies go

along in solid phalanx for the cause but that would be entirely up to their judgment.

Mr. KETCHUM. I could not speak for the Legion. I do not know what testimony they are going to offer or whether they are going to offer any before the committee. All I can state is our position which has been arrived at after long study.

Senator MAYBANK. May I ask this, Mr. Chairman?

The CHAIRMAN. Go ahead.

Senator MAYBANK. I was just going to suggest to the distinguished veteran of Foreign Wars that there has not been anything you have heard that the American Legion would oppose it?

Mr. KETCHUM. That is right.

Senator MAYBANK. I mean there is so much duplication in numbers in the two organizations.

Mr. KETCHUM. I would not say there was too much.
Senator MAYBANK. There is some.

Mr. KETCHUM. Probably 15 percent. That is what we have estimated.

Senator MAYBANK. But what I meant was that you have not heard they would oppose it?

Mr. KETCHUM. I do not know what their position is.

Senator MAYBANK. I have never heard that.

Mr. KETCHUM. There have been statements back and forth. Senator MAYBANK. I hope they are not going to. The only thing that concerns me in this amendment, without prejudice at all, Mr. Chairman, was the testimony of the House authorities here the other day when some question was raised. I think Senator McCarthy raised, that if you would give the veterans preference you would displace a lot of these people in these cities right now that would bring about a rather rough time on families who themselves might not be veterans but were more or less related to veterans and so forth and so on and cause quite a displacement within communities. Have you given any thought to that? I do not know whether that would be a fact or not but that was the testimony that was here. Mr. KETCHUM. Here is why we do not anticipate any particular difficulty on that. It does not mean the present occupants would be immediately evicted even though preference was given to the veterans and the veterans purchase it immediately. It will not be until 1948, as I understand it, that the present occupants will be removed from the properties.

That is the present contract drawn up for sale regardless of who purchases it. In other words, there is protection to the present occupants to make certain that they are not immediately evicted, that they have ample time and opportunity to seek other quarters. Senator MAYBANK. Just thinking out loud and not committing yourself at all, suppose this was further amended to give them 12 months?

Mr. KETCHUM. That would be all right, surely.

Senator MAYBANK. Because that was the testimony that the housing authorities came down here and said. I have always been one for veterans' preferences, as you know, on these other bills here. Mr. KETCHUM. I know that is right.