We would be pleased, if you would wish to send you some copies of our analyses of community development proposals that have come forth in the first year or more importantly, perhaps, in the second year, which strikes us as not at all related directly to expanding opportunities of low- and moderate-income families.

There are citywide programs where the claim might be made that low- and moderate-income families will be beneficiaries. These families are not excluded from the programs. But the programs as we interpret them do not meet the act's specific proposal of expanding opportunities for low and moderate income, as we interpret them.

Mr. BADILLO. Yes, we would be very grateful if you could give us that information, because the act does say that maximum consideration for the use of funds be given to benefit low- and moderateincome families, and we do have the statement of the 70 percent, which seems to be quite a substantial percentage.

I have found, in the areas that I have looked at, that maximum consideration, if it were to be given, could easily be 100 percent, but in some cases, less than 50 percent goes to those families.

So any information you can give the subcommittee on applications that would indicate a percentage lower than 70 percent would be very useful to us.

Mr. DAVIDOFF. We would be pleased to do that, Mr. Congressman. Let me ask this question: Did HUD submit an analysis of projects for you?

Mr. BADILLO. We asked for it.

Mr. DAVIDOFF. I would like very much to have a chance to review that.

Mr. BADILLO. Now, you say in your statement, on page 8, that one of the factors that was not present in the applications of several towns was the required signed assurances in the housing assistance plan. Which assurances were those, specifically?

MS. BROOKS. There is a required, preprinted form prepared by HUD that is simply entitled "Assurances." It states, among other things, that the applicant community in the use of funds will comply with Federal civil rights and other laws. The form is to be signed by the applicant community.

In addition, on that assurances form, there is a point No. 10and I can supply you with the assurance form if you do not have it-where the applicant community is to indicate whether or not the use of its community development funds will in fact go to benefit low- and moderate-income persons, or whether those funds are being used to meet some other kind of urgent need. In many instances, no indication was made of the use of the funds or the form was not signed or was not in the application at all.

Mr. BADILLO. There is also an assurance, is there not, that in terms of the construction of the projects, there will have been an opportunity given to minority contractors to be hired for those projects? Were those assurances given?

MS. BROOKS. I believe that is a part of the same form, that the law under which those obligations are found are itemized on this

assurance.

Mr. DAVIDOFF. Let me just add a word about the assurances. In some circumstances, we thought it ludicrous for certain towns to sign those assurances. They just have not, in their past practices, understood what was meant by obeying the civil rights law.

I think it is very important that there be a very close scrutiny of how HUD monitors those assurances at the end of the first year's performance, what it will call for, how closely it will scrutinize what these communities have done to act affirmatively to expand opportunities.

Mr. BADILLO. On the question of the review procedure, where you have indicated that some of the civil rights groups objected and their objections were overruled, was there a hearing at a regional office, because, you know, there is a procedure that requires that the regional office have a period of time in which to disapprove the application. Then it goes to the central office. Did you get an opportunity to present the objections to the regional office?

Ms. BROOKS. NO. In no instance-Even when the reviewing organizations requested a conference, the conferences were not held in most instances.

Mr. BADILLO. I think my time is up.

Mr. EDWARDS. One of the problems, it seems to me, is that HUD does not have enough muscle. Even if it exerted all of its opportunities for insistence on fair housing, the majority of the municipalities could say "well, we can get along very well without you, HUD, and we are going to go our own way." That is a problem, is it not?

Mr. DAVIDOFff. It is.

Mr. EDWARDS. It is certainly a big problem in my area, where the cities surrounding San Jose are affluent. They are nearly all white, middle class, and have no interest in helping the ill-housed, unemployed and those in the barrios of San Jose, which is 20 to 25 percent Spanish-speaking.

I want to, just for a moment, ask you about this section 8 that is in operation now. I see in the New York Times this morning that only 4,600 of 1 million eligible low-income families in the city of New York have applied for the new rent subsidy program. Now, the theory of this program is sort of an outgrowth of section 23, Scattered Housing, which has worked very well in Californiathat is, section 23 did.

Is this the way section 8 is going to work:

Is not one of the differences between section 8 and section 23 that, under section 23, the housing authority itself, at least in California, would rent the houses and then re-rent them at a lower rate to the low-income families? Now, under the new law, section 8, the families themselves have to go out-they get a certificate, and then they go out and find their own housing.

Now, apparently, that has gotten off to a very poor start in New York City. It has gotten off to a very poor start in California. Is there any hope for it?

Mr. DAVIDOFF. I find it difficult to answer that question. I am troubled with section 8 with the information problem, on the one hand, of what information is given to families who qualify in New York City.

I think there is very little knowledge of the program. I think the agencies are not informing, are not providing the kind of public information that is required to enlarge greatly the number of appli

cants.

Mr. BADILLO. Well, the problem, Mr. Chairman, in New York City, is that the builders will not build privately, and the city of New York cannot get credit. Therefore, from a practical point of view, new construction under section 8 is not available.

Mr. EDWARDS. Well, this would be for existing housing, and the people are not even interested in getting a certificate and going out and paying just 25 percent of their income for existing apartments, and I am sure there are some vacancies in New York.

Mr. BADILLO. Well, if we could get Mr. Roger Starr to stop going around talking about cutting services and spend some of his time promoting the program, I think that we could get people to apply. But one of the difficulties is that we have a worse situation than Mrs. Hills', in terms of the people running our housing programs, in terms of wanting to get the project under way.

This is what I mentioned yesterday. New York filed the application pointing out the needs; a million people in New York City, but then in terms of having a program to meet the need, there is no reasonable effort that accompanies the application.

Mr. EDWARDS. Well, it just seems to me that it would be a much better policy to apply to the housing agencies and not send lowincome families all over New York City knocking on doors, trying to find an existing apartment, carrying in their hands the certificate of entitlement. It has never made sense to me. I do not think they are going to do it. I do not think they are necessarily equipped to do it. The housing authority is the agency that should take this responsibility.

Maybe that is the law-I do not know. I see the HUD General Counsel back there in the audience. Is that the law, or is that a regulation? Could you please answer that question for me?

Mr. ELLIOTT. I did not really understand the thrust of your question. Could you restate it, Mr. Chairman?

Mr. EDWARDS. Well, under section 23 housing, the housing authority itself would lease the property from the landlord and then sublease it to a low-income family at low rent. Now, under section 8, the low-income family gets the certificate, and then has to go out and find its own apartment or house to rent, and it can rent and have a subsidy. But you see, in New York, for example, that they are not doing that. They are not about to go out and find their own housing. Now, is that process for section 8 provided in the law or is that a regulation? That is my question.

Mr. ELLIOTT. In the legal structure of section 8, the housing authority does not rent the property from the owner. I have not looked at the article you have there, but I think generally throughout the country, there has been very considerable response to that program. It has not been a program that it is very difficult to have citizens participate in.

I think generally that civil rights groups view that structure very affirmatively because it enables prospective tenants to seek housing

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in any location they wish, within the jurisdiction that the housing authority administers the program. So, to answer your question, yes, section 8 is a structure which Congress substituted for section 23, and it requires direct leasing by the tenant.

There is a separate housing assistance payments contract which pays for part of the rent, and that contract between the housing authority and the landlord, but the lease itself is between the tenant and the landlord.

Mr. EDWARDS. Thank you very much. I appreciate it.

Mr. BADILLO. Could you get for this subcommittee some figures that show the success of that program, as you put it, in different parts of the country up to now?

Mr. ELLIOTT. Yes. The number of units leased to date, and that sort of thing? We would be happy to submit that.

[The Department submitted the following information for the record:]