a restriction on the property the entire debt may be accelerated by the holder and become immediately due and payable. We have not done this for several reasons:

(a) The Veterans Administration does not prescribe a mandatory mortgage form. Our mortgage forms were prepared for use by those who desired to sell mortgages to the Federal National Mortgage Association. They can, of course, be used at any time by any lender, but so long as a first lien is obtained our requirements are satisfied. (b) The prohibition against creating a discriminatory racial restriction is by regulation incorporated by reference into each and every mortgage-loan agreement and is as effective as if it were printed in each mortgage.

(c) It is extremely unlikely that an individual would so restrict the sale or occupancy of property which he might want to sell. We have not been informed of any instance where it has happened. Sellers of individual properties normally do not do anything to narrow their sales market.

(d) Few mortgagors retain a copy of their mortgages and the maze of legal documents as well as the atmosphere attendant the usual loan closing would make it highly unlikely that the borrower would carry away with him such a requirement. We believe it is much better to depend on the lender to make certain there is no violation of Veterans' Administration requirements.

In conclusion, I would like to repeat that the Veterans' Administration benefits are available to all eligible veterans. We would hope that eligible veterans who want to satisfy their home-financing needs with GI loans would be able to do so. However, during the life of the program there have been many periods when veterans generally found it difficult, or impossible, to take advantage of this benefit due principally to the unavailability of mortgage funds or credit restrictions. As a matter of fact, at the present time GI loan financing is virtually nonexistent in many areas due to the tightening in the supply of investment capital and the unattractiveness of the Veterans' Administration 434 percent interest rate.

Another consideration is the fact that the Veterans' Administration programs have terminal dates under existing law. The World War II veterans' entitlement will expire on July 25, 1960, as will the entire direct-loan program. The guaranty program for Korean veterans expires on January 31, 1965.

We are certainly desirous of cooperating fully to eliminate discrimination from any area. Within our authority you may be sure we will continue to cooperate as we have in the past with State and Federal agencies who have this objective as a basic responsibility.

Chairman HANNAH. Thank you, Mr. Lamphere.

Now, if it is agreeable, we will proceed with the questioning period.

We will now make it possible for the Commissioners to raise any questions they may care to.

I will turn first to the Vice Chairman of the Commission.

Mr. Storey, do you have any questions you wish to raise?

Vice Chairman STOREY. I would like to ask Mr. Mason a few questions.

Mr. Mason, as I understand, you are the head of these various organizations insofar as administration is concerned.

Mr. MASON. Excepting the Veterans' Administration.

Vice Chairman STOREY. I mean of the ones you introduced.
Mr. MASON. Yes, sir.

Vice Chairman STOREY. In other words, the Housing and Home Finance Agency is your office; the Federal Housing Administration, Public Housing Administration, Urban Renewal Administration, Federal National Mortgage Association, all come under your jurisdiction. Am I correct in that?

Mr. MASON. Yes; they do. There are varying degrees of authority, sir, as I pointed out in my statement, but the policymaking is mine. Vice Chairman STOREY. I recognize that and that is what we want to get at.

There are varying degrees of authority but the top policy administration is centered in your office and under your direction; am I correct?

Mr. MASON. That is correct, sir.

Vice Chairman STOREY. You say there are varying degrees of authority. Without going into too much detail, what are the limitations on your authority with reference to your own and these other agencies?

Mr. MASON. The Public Housing Administration and the Federal Housing Administration are both independent agencies set up and operating under Commissioners appointed by the President with definite authority going to them from the Congress.

My agency was created as a coordinating and policymaking agency for all these agencies.

Vice Chairman STOREY. Including FHA and PHA; am I correct in that?

Mr. MASON. Yes.

The Commissioners of the Federal Housing Administration and the Commissioners of the Public Housing Administration have direct responsibility to the Congress for enforcing certain laws or carrying out certain laws.

Vice Chairman STOREY. Does that include the policymaking authority, also, for their administrations?

Mr. MASON. In general, I believe you could say, so far as this matter under consideration is concerned, the policymaking is done by the Administrator of the Housing and Home Finance Agency, which is myself. We do this by cooperation, may I say.

Vice Chairman STOREY. I recognize that.

You are a coordinating officer for those respective administrations? Mr. MASON. Yes, sir.

Vice Chairman STOREY. You made certain suggestions here and you have promulgated certain policies. What have you actually done in the way of promulgating policy to carry out these ideas that you have expressed in your very fine paper?

Mr. MASON. You will understand, or you probably know, that I came into this job and was confirmed in the tail end of January. Vice Chairman STOREY. I realize that. When I say "you," I mean the Administrator.

Mr. MASON. I know. That is me.

Vice Chairman STOREY. As well as your predecessors.

Mr. MASON. What I was trying to say was that I came into this job late in January, following Mr. Cole, who had been the Administrator. I had certain more positive policies, perhaps, or different policies that I felt were important to pursue, but it takes a little time in government to accomplish some of the changes that one wishes to make.

Vice Chairman STOREY. I am very cognizant of that.

Mr. MASON. I am in the process of doing these things, which makes it somewhat embarrassing for me to appear before you gentlemen at this time and talk about anything but what I am planning to do.

Vice Chairman STOREY. Are you able to give us, within the area under inquiry, any definite proposals that you are free to talk about now relating to policy matters?

Mr. MASON. One of the things that I have done recently was to have each of the constituent Commissioners review his program to see whether there were ways that could implement the policy which I believe is important in accomplishing more understanding and more cooperation with all the factors that are interested in this problem. To this end, Mr. Steiner spoke in his paper about certain facets there. In the Federal Housing Administration we cooperated very extensively with the State of New York in its program and have in that agency a man currently working and studying that program. The results of his study will certainly be available to your Commission if he gets the report done in time. He is studying the operation of that law.

As you know, the enforcement of it is largely done by persuasion, or at least the first steps are done by persuasion, to see whether the cooperation we have is adequate and functioning properly. This is something that is actually being done at the present time.

Vice Chairman STOREY. In other words, you are more or less like we are. You are in the fact finding business at the present time, personally.

Mr. MASON. I think all of us in this field are in the fact finding business, because I believe we are progressing to find answers and that the answers we have today may not be the answers we will find next year or year after next.

Vice Chairman STOREY. In other words, your major attention now is in the factfinding process, looking toward the promulgation of certain policies based upon facts and a proper evaluation of them.

Mr. MASON. I would say that was correct; yes sir.

You will note that I said that one of the things I believe in strongly is that we accomplish the most in this field by giving rewards rather than punishments. Most of our programs are not now geared that way. Some of them are.

Our workable program, which is, in my estimation, one of our most potent forces to accomplish the good we are trying to accomplish, is one which offers rewards. If you as a city will adopt a workable program, a program in which you review where you stand as a city and where your zoning and building and safety ordinances are, and tell us that you are going to do something about a better implementation of these, then we will make available to you the facilities of the Federal Housing Administration, Public Housing Administration and the loan-and-grant program of the Urban Renewal Administration. We don't make these available without this. This is the kind of incentive that I talk about as an objective to go further in our program.

Vice Chairman STOREY. I believe that is all I have, Mr. Chairman. Chairman HANNAH. Father Hesburgh, do you have any questions? Commissioner HESBURGH. Yes.

I was wondering what were your reactions to the thought of a Presidential Commission to study this whole program and come up with some suggestions.

Mr. MASON. Father, with your Commission working on this, I felt the proper thing to do was to wait until your Commission had made. its findings rather than to have two groups working simultaneously. I would say this is not only my opinion but it is also the opinion of the Administration.

Commissioner HESBURGH. I think those of us who have been working directly with this in the hearings have often felt that we wind up with a lot of peripheral knowledge and what this really needs is an expert group that knows the field perfectly and that has some competence beyond what we have in housing, as such, that could perhaps

sharpen up some of the factual material and make good recommendations regarding an Executive order or other such things.

Mr. MASON. I am sure there are possibilities along this line, but I am sure your Commission is finding out a lot of information, too, that is not available in the more restricted field in which that committee worked.

Commissioner HESBURGH. I was wondering, Mr. Mason, what you thought about the suggestion of the Schwulst committee that there be an Executive order saying that all federally financed housing should be made available on an open-occupancy basis; in other words, that it be for the benefit of all the citizenry, not just one group.

Mr. MASON. America is a big nation, Father. As you know, in a good many parts of this nation open occupancy is already a requirement. On the other hand, in other parts, it is steadfastly and tenaciously opposed. Until we have more fully caught up with the housing needs of America, it seems to me that we might do more harm. than good by precipitant action. This kind of cure at this time-this month-this year-might cause problems more serious than the ones now facing us. We can accomplish the objective we strive for by using the greatest care to be certain that we are doing the right thing.

Commissioner HESBURGH. What would you think of a suggestion that there be set up an executive committee for this whole problem, geared to phase out a program? There are some areas where this is required by law right now and other areas where there is no objection to it, but there may be no law or only the objection of the real estate people. There are other areas where laws are actually under consideration. There are three or four such areas now, and where a recognition of the problem in some of the Southern States where it might be equivalent to a kick in the head to the public housing program, where the thing could be taken under advisement or talked over with various groups involved. I am thinking of a phased program. Would this involve leadership, do you think, on the part of the Federal Government?

We were told that a very low percentage of financing of private new building was available on an open-occupancy basis. I think it was less than 1 percent in New York.

Mr. MASON. The question is: Should there be somebody to go on with the program beyond the recommedations of your committee? I take it that is what it is. This is, in essence, what I am trying to do now in a limited way.

I would think it would be an excellent suggestion. In my responsibility in its limited field, I am studying such things as the Schwulst committee's report. I think he is a fine public citizen to have gotten