Do you have any comments, any suggestions to make as to how you might help to encourage regional planning, development, and cooperation?

Mr. MAFFIN. As we understand the bill, Senator Stevenson, there is no particular incentive explicitly stated. However, there is nothing which would preclude such regionalization of the programs. As a matter of fact, one section of the bill, permits interstate compacts for community development thereby clearly recognizing the inner relationship of the problem among political jurisdictions. However, by virtue of consolidating a wide variety of what have been differentially administered programs like sewer and water, open space, and urban renewal S. 2333 implicitly is requiring formulation of joint ventures and cooperation at the local governmental level.

Other devices to bring about regionalization have been suggested, such as providing bonuses similar to those in the early open space programs, where if an open space area covered two or more jurisdictions, the percentage of grant would be increased. That is one device for doing so. Of course, another approach is to provide penalties for not doing so. S. 2333, however, makes it possible to do regional programs where the will, the desire, the machinery, and the bureaucratic expertise exists, and does not require it otherwise; it does implicitly encourage it.

Senator STEVENSON. You indicated that S. 2333 would tie housing to community development. How would federally assisted housing be tied in with community development assistance?

Mr. MAFFIN. If I said it precisely that way, I probably put the foot on the shoe and not the shoe on the foot. What I meant was that when a community applies for community development assistance, and among the component actions that it proposes to undertake is the clearance of sites for federally assisted housing, then the Secretary, in approving that program, is required by the legislation to set aside the requisite assistance funds to provide these units. Thus, the Federal financial subsidies will, in fact, be available at the time when needed.

This does not mean that housing assistance cannot take place in other areas, but it precludes the reoccurrence of the problems we have had in the past. I can give you personal examples from my own experience, where a community plans and implements a program of urban renewal that proposes housing redevelopment, but when it reaches the point where it is ready to have the land redeveloped for housing, there is no Federal assistance available. This kind of delay causes two things. One, it makes prime land lie fallow, and, two, it runs counter to our desire to cut costs, because development costs rise with inflation. Both these problems ought to be dealt with, and we think the procedure contained in S. 2333 is, perhaps, the way to do it.

Senator STEVENSON. The Federal assistance under 235 and 236 would continue quite independent with regard to local development claims? Mr. MAFFIN. Yes.

Senator STEVENSON. I understand that a bill introduced by Representative Patman in the House would require that the federally assisted housing for housing funds be channeled through a metropolitan housing agency as opposed to going straight to the developer. I gather you don't think that is necessary in order to improve area wide development?

Mr. MAFFIN. I need to point out, Senator, that NAHRO will comment in depth on this proposal when testifying on pending housing legislation next month. As I said at the outset, we have in the last year developed a position on comprehensive community deevlopment, and similarly one of comprehensive housing assistance; on the housing side, we do propose incentives for market aggregation of housing assistance to have the kind of linkage to which you refer.

Senator STEVENSON. Senator Taft, do you have any questions?
Senator TAFT. Thank you, Senator.

Mr. Maffin, do you believe that local contribution in these programs is desirable, or necessary, or not?

Mr. MAFFIN. The answer to that question is "yes." We think, in the first place, that local assistance is going to be needed, in terms of personal services, the capital improvement program, the operating budget, and the maintenance and operation of facilities. We think that this type of local development ought to be recognized as part of the total community development effort. I think that it should be noted that federally assisted community development is only a part of the total action required at the local level. By requiring this kind of local contribution, S. 2333 tends to provide linkage between the federally assisted programs and other local programs being undertaken at the community level.

Senator TAFT. What extent would you require approval of plans, community development plans? Would you require that there be approval of a regional planning authority?

Mr. MAFFIN. The answer to that question is "No," and it may seem to run counter to the comments to Senator Stevenson a moment ago. Let me say why. With all due respect to the desire to improve the rationalization of these programs, the fact remains that their effective administration depends upon the existence of effective experience and personnel. It is sad to say, but nonetheless true, that this kind of expertise and experience in many parts of this country simply does not exist. The effect of regional requirements may well be to slow down the necessary delivery of needed service and products in programs while we are creating a new set of machinery.

Senator TAFT. May I say, I agree with you strongly on that point. The experience that I have seen exist in two or three different areas differed greatly from the lack of experience that I have seen exist elsewhere. I think it has been very damaging and disruptive. It has become a source of conflict between governmental units that should he cooperating. I am not sure what the answer is. I feel, in the long r, in theory, it makes sense. In practice, it just hasn't made very much sense, particularly when you are dealing in interstate situatons, as in Cincinnati, where you have got three States involved in a general metropolitan area. It has become extremely difficult with regard to financing multicounty problems, and everything else. I am interested to have your answer on that subject.

I know there is a section in each of these bills dealing with interstate ompacts. You made some mention of interstate compacts. Do you feel that advance approval by the Congress is one, desirable; two, Constitutional?

Mr. MAFFIN. I am not qualified to address the latter point. To the former point, Yes, I think it is desirable. It recognizes that community

development problems are structured many times without regard to political boundaries, crossing a variety of jurisdictional lines. The desire to begin to match programs and problems together is a good one, and by allowing this kind of effort to take place, it is recognition of multijurisdictional nature of the problem.

Senator TAFT. How do you feel about the water and sewer grants not included in a program of this sort?

Mr. MAFFIN. Obviously, an effective community development program cannot take place unless it addresses itself to the problems of sewer and water within that jurisdiction. There are however, situations in this country, quite frankly, where sewer and water at the moment may be the only real vital, critical need. It is NAHRO's opinion that while sewer and water ought to be recognized as integral parts of community development, there are situations where community development may not be requisite to sewer and water problems.

Now, that is kind of a left-handed way of saying water and sewer should be both in and out.

Senator TAFT. I think that is all the questions I have, gentlemen. (The full statement of Mr. Maffin, with attachments, follows:)

STATEMENT OF ROBERT W. MAFFIN, EXECUTIVE DIRECTOR, NATIONAL ASSOCIATION OF HOUSING AND REDEVELOPMENT OFFICIALS

Mr. Chairman, members of the subcommittee, I am Robert W. Maffin, Executive Director of the National Association of Housing and Redevelopment Officials, I wish to thank you for this opportunity to testify on community development proposals now pending before you on behalf of the local housing, renewal and code enforcement officials who comprise the membership of NAHRO.

NAHRO SUPPORTS A REVAMPING OF FEDERAL COMMUNITY DEVELOPMENT POLICY

Twenty-two years ago Congress passed the landmark Housing Act of 1949, which established the basic framework for federal and local community development policy, urban renewal. Today, after more than two decades of operating under the renewal program, local public officials have accumulated sufficient knowledge and experience to be intimately familiar with the program's potential and its shortcomings.

This expertise, based on daily confrontation with the ugliness of physical decay, has led to a recognition of the collateral problems associated with physical development--education, health, employment, crime. We know that the shape and the form of the city-its physical environment-shape the city's economic potential and its citizens' lives. Thus, as the physical deterioration of our cities has increased, so also has the social and economic conditions of its citizens deteriorated. While urban renewal has permitted communities to deal with some of these collateral problems, it has usually been done on a piecemeal basis. Existing law does not encourage, facilitate or permit communities to launch the total. coordinated community development effort needed to stem the rate of urban decay. NAHRO, recognizing the national significance and urgency of this unmet need. felt compelled to draw upon local, member experience to examine the current status of federal urban development policy-where it is today, in what directions it should move. (Earlier, in the mid-forties, national urban policy was at a similar seminal point. NAHRO recommendations then for post-war urban housing policy contributed substantially to the Housing Act of 1949.) In 1970, NAHRO established a special policy development committee which, after working for six months, recommended the implementation of a new comprehensive community development program and a new single-subsidy housing assistance program. These recommendations are contained in exhibit number one of our testimony and we ask permission to have it included as part of our statement.

Mr. Chairman, your bill, S. 2333, The Community Development Assistance Act, we find to be in basic agreement with the thrust of our community develop ment policy statement. NAHRO strongly supports this bill as the best approach

to revamping our development efforts. I appear today to discuss the bill, emphasize how the development process would operate under it, and discuss its technical aspects. First, however, I would like to make a few comments on the relationship of this bill to existing development policy.

S. 2333 recognizes the present inadequacies of Federal development policy but builds on its successful approaches.

The strength of S. 2333 is that it builds on existing federal and state law and local development practices, expanding or maintaining those provisions which have permitted progress toward community development; to provide the necessary linkage of physical activities to social and economic needs; and to permit local flexibility in organizing development programs. This approach means local officials, now administering existing programs, will find the transition to this new program facilitated. Moreover, public support for existing programs developed over the past two decades will not be jeopardized. Finally, passage of the bill without lengthy hearings and endless deliberations may be facilitated since Congress is familiar with many of its provisions.

Recently, others have suggested proposals which would scrap the existing approaches used in urban renewal and replace them with totally new and untested programs. Those proposals ignore two basic facts: first, urban renewal has been a successful and popular program, and; second, renewal's problems are not a result of its basic concept but due to inadequacies in present law.

Nationally, the list of accomplishments attributable to renewal is impressive. Over 1,000 communities of all sizes—in every state-have participated or are participating in the program. Through renewal, communities have been able to clear hundreds of acres of slums, to replace worn out public facilities and improvements, to reduce the danger of fire, remove sources of water and air pollution and areas of traffic congestion. At the same time renewal has brought to the level of public consciousness the enormity of physical and human problems which are hidden in the slums and blighted areas of our cities. When the projects approved through fiscal year 1970 are completed, renewal will have: facilitated the construction and rehabilitation of 1.3 million housing units, two-thirds of which are for low and moderate income families; reduced the cost of public services to locations in renewal neighborhoods; generated 2.2 million jobs; and increased the assessed value of the renewed property by an average of 240 percent. These statistics only tell part of the story; in individual communities, renewal has been the tool to rejuvenate public confidence in the future of that community, to encourage private investment in other neighborhoods, and to attract new jobs. In summary, urban renewal has been responsible for producing a diverse list of accomplishments: increased citizen awareness and participation in Rochester, New York; new medical facilities in Birmingham, Alabama; disaster relief in Atchison, Kansas; historic preservation in Plymouth, Massachusetts and new economic vitality in Montevideo, Minnesota, a town of 6,000.

At the same time, Mr. Chairman, we recognize that there are gaps in the present program which have precluded communities from undertaking the coordinated approach necessary to bring about their total revitalization.

First, the program limits community renewal to certain geographic areas. It is based on the presence of blight in a certain area and a plan to remove it. As such, certain project areas are designated and only within these boundaries can renewal operate. This had led to situations which many citizens complain are inequitable. Low income property owners in one location can receive a grant to rehabilitate their property while a family of the same income across the street is ineligible to receive such assistance because it is not within the "boundary area".

Second, the list of activities eligible for assistance is not a complete one if the community wants to deal with the total restructuring of an area. For example, in a code enforcement project, certain public improvements, such as new sewer lines and undergrounding of utilities are not eligible activities, preventing total nighborhood improvement under this renewal activity.

Third, and perhaps most important, urban renewal does not provide the necessary linkage to other programs vital to the coordinated social, economic and physical development of an area. Today, renewal plans are drafted which call for the construction of federally-assisted housing, neighborhood factlities, schools and libraries on the cleared land. However there is no guarantee that this federal assistance to construct these factlities will be available when the land is cleared. Land will remain vacant for months, even years, while separate applications are reviewed and processed in Washington. Meanwhile, community improvement timetables become meaningless and neighborhood support for the project deteriorates.

Fourth, there is a lack of financial commitment at the federal level to the renewal program, with federal budget requests and appropriations far short of actual need. Today, the renewal backlog approaches three billion dollars in application requests; yet, the appropriation for this entire fiscal year amounts to only 1.25 billion dollars. The recent impoundment of appropriated funds by the administration has complicated matters even more, forcing postponements and curtailments of planned activities. Finally, Congressional reluctance to approve funds for more than one year has meant the communities are unable to schedule activities along any rational basis.

Fifth, the application procedure is a complicated process involving endless paper work, needless reviews, and protracted delays. What twenty-two years ago was viewed as a quick process has grown into a complicated bureaucratic nightmare with applications for assistance looking more like encyclopedia volumes than statements of action. Not only does this mean additional time to draft the application but needless reviews and requests for clarification from federal officials.

Therefore, Mr. Chairman, a new program to rectify these problems is justified. but this program should be based on the experience and knowledge we have acquired over the last two decades, building upon the techniques which have succeeded.

S. 2333 PROVIDES A PROGRAM WHICH WILL PERMIT LOCALITIES TO TRANSFORM THEMSELVES INTO VIABLE, HEALTHY COMMUNITIES

S. 2333 meets the inadequacies an gaps in the present federal development programs. It consolidates related programs, simplifies federal requirements. provides linkages to other programs, increases the federal financial commitment to communicate while guaranteeing the continuity of this commitment, and maintains the national priorities of slum removal, blight prevention and housing production while encouraging flexibility in establishing local programs. This is a different approach—and in NAHRO's opinion a far superior one-than that contained in the other major community development proposal now before the subcommittee, S. 1618. Urban Community Development Revenue Sharing. Mr. Chairman, the NAHRO Information Center for Community Development has prepared a detailed comparison of these two bills along with the grant consolidation bill recently introduced in the House of Representatives. This is attached as exhibit number two to our tesimony and I ask permission to have it included as part of the record of these hearings. I would like to devote the remainder of this statement to a discussion of the key elements of S. 2333, indicating the advantages of this bill, suggesting some minor modifications, and comparing it to the special revenue sharing proposal.

I.

S. 2333 recognizes, for the first time, a national commitment to maintaining cities and other urban areas as viable economic, social and political entities. Section 2 of the bill, "Finding and Purpose" contains this national policy statement. It also identifies the policy mechanisms which must be enacted to achieve it: systematic and sustained activity for blight removal, conservation of existing neighborhoods and renewal of declining areas; substantial increase in the level and scope of federal assistance with guaranteed continuity of assistance; and streamlined procedures at all levels of governments.

It is NAHRO's opinion that this national commitment, if enacted, will be as significant as the 1949 goal of a "safe and decent home and suitable living envi ronment for every American family" and the 1968 legislative establishment of national housing goals. This commitment is at variance with the special revenue sharing proposal, which emphasizes the need to improve the delivery system of federal monies to localities without expanding the level of this assistance.

II.

S. 2333 maintains national priorities for the distribution of federal funds but gives communities flexibility to devise programs recognizing local priorities, This is an area where a delicate balance must be achieved. It is a federal respon sibility to establish overall goals on how federal funds should be spent. However, in the past, federal legislation and regulations have added so many detailed re