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housing to house war workers. Of course, in that case, why the tenants were forced to pay an economic rent and no subsidy was paid by the Government for those people.
The CHAIRMAN. If it had not, they would have to stand out on the street.
Senator ELLENDER. Your association submitted, as I recall, to us a bill, a housing bill.
Mr. FARR. That is right.
Senator ELLENDER. Well, if we strike from this bill that is now under discussion the public-housing feature, would you say there is much difference between the bill you proposed and the one we are now considering?
Mr. FARR. Yes; there are certain points we are trying to bring out in this statement.
Senator ELLENDER. Because I quote here from a publication in which you are quoted. [Reading:]
NAREB was one of the sponsors of the "private enterprise" bill laid before Senators Wagner and Taft in late October 1945
Mr. FARR. Yes.
Senator ELLENDER (reading):
recommending an urban development program of Federal aid to cities for redevelopment calling for up to $500,000,000 in grants and $500,000,000 in loans. In a circular letter dated May 1, 1940, NAREB had the following proposal [reading]:
The blighted areas cannot be reassembled, replanned, and rebuilt by private effort unless Government helps. We suggest that USHA be remodeled into an agency which will assist private redevelopment companies chartered by it to rebuild large areas in the blighted districts. Such assistance would be necessary in land assembly and also in the form of long-term loans at low-interest rates. You are still for that?
Mr. FARR. In general. That original program has been modified through discussion and study.
Senator ELLENDER. So you have kind of receded from that plan? Mr. FARR. No. Remember we are all trying to make progress in this thing. The more discussion we have the more information I think we gain. I think we all know a lot more about it today than we did 5 years ago.
Senator ELLENDER. To be specific, with respect to the city of Washington all you have to do is walk about two blocks from here and you may be astounded.
Mr. FARR. I have been there.
Senator ELLENDER. Aren't you ashamed of it?
Mr. FARR. We have similar situations in Chicago.
Mr. FARR. That is right, and our desire is to rectify those situations. Senator ELLENDER. And your method, as you have stated to Senator Murdock a while ago, is to tear those down and let the people who live in there live in the older houses that would be vacated by those who would be fortunate enough to build on this new ground, supplied partly by Federal aid and State aid, and maybe city aid. That is your plan, isn't it?
Mr. FARR. That has been the custom for years and years.
Senator ELLENDER. I know, but it has not cleared the slums, has it? Certainly it has not worked in Washington.
Mr. FARR. Remember that the slum-clearance program has been one also of the ability to finance redevelopment in those areas.
Senator ELLENDER. Of course, that is why private capital has not ventured, because it is not profitable enough, and that is why we are offering a method here whereby it can be done. I am really disappointed that you folks should be willing to accept aid from the Federal Government to clear the slums and get this real estate back at a very large mark-down price and not be willing to utilize money in the same way to aid and assist the people that you have never been able to assist up to now. I cannot understand it.
Mr. FARR. Don't you want to encourage investment of this large mass of capital that is represented by the banks and insurance companies and other institutions?
Senator ELLENDER. Yes. The bill sets forth unmistakably that the local community decides its housing needs, the local community decides the extent to which private enterprise will do the job, and if a time comes when private enterprise cannot do it, then what happens! You don't come to Washington immediately, but you have got to get your municipal government to investigate, and the municipal government itself must make the determination that private enterprise cannot do it.
Until that is done, under this bill, you cannot come to Washington and get a dime for public housing. All the other requirements we added to make it certain that private enterprise would have the opportunity to do the job at home.
Mr. FARR. I think you should give private enterprise the opportunity to do that, and they have not had that opportunity up to now. Senator ELLENDER. But the bill does it.
Mr. FARR. The bill is not enacted yet, and the opportunity we would like to have
Senator ELLENDER. In other words, you would want to set the bill aside and give you a chance to try to do it for another 40 years, and maybe fail.
Mr. FARR. We all want to make progress, don't we? We don't want to spend all of our time arguing and disputing as to just how this should be done. We believe that things should be done that can be done now. We are much distressed at the obstacles that have been in the way of the private builder during the past few years, but the war is over now, and we think those obstacles should be eliminated.
Senator ELLENDER. If this bill is enacted into law, the Federal Government would not have to put up a dime of money for public housing if the local community can ascertain that private enterprise can do the whole job.
Mr. FARR. Why not give the local community that opportunity then? Senator ELLENDER. I say, what difference does it make if the local community is prohibited from doing it until it is established that you cannot do the job. You have elected officials there who are put into office by the voters.
Mr. FARR. When they cannot do it, then let's discuss the next step. Senator MURDOCK. You are overlooking the fact, Senator, that these people who live in tenement houses and slums vote and they might vote
for officials who would not be so favorable to the present landlords and might vote for people who want to do something for the tenants. As I understand it, you don't want any of this to come except with the approval of your organization.
Mr. FARR. No, no. We want the approval of our local community. Senator MURDOCK. Of course, you do all that you can through your organization to control that very thing.
Mr. FARR. The National Association of Real Estate Boards does not control the situation in Chicago, or Detroit, or New Orleans. The members in those local comunities are interested in the community, but there are many people in those communities. The real estate board does not run the local city.
Senator MURDOCK. They have a terrific influence on it, I will tell you that.
Mr. FARR. They should have a substantial influence, because
Senator MURDOCK. I think they should have a substantial influence, but I don't think they should have such an influence that perpetually keeps a certain segment of our population in the slums, and that is what this bill is intended to eliminate.
Mr. FARR. I think you will find there are many civic-minded citizens who are members of local real estate boards who are taking an active interest in trying to build up their communities; in trying to alleviate these conditions.
Senator MURDOCK. Well, I hope so, but as Senator Ellender has pointed out, is it going to take another 40 years before, right here in the National Capital, we remove things which are a disgrace to us? Here we are, and correctly so, appropriating more than a billion dollars today to be sent to poor people in other parts of the world. We should do that; but when I go around this Capitol and see the conditions right in the shadow of it, I cannot help but be ashamed of the fact that my country, although with all its generosity to the rest of the world, is still willing, right here in the Nation's Capital, to wink at housing conditions such as we have here.
Senator ELLENDER. As you read this bill, on page 76 of it appears this language, beginning on line 22 [reading]:
In recognition that there should be local determination of public low rent housing, the Authority shall not make any contract for financial assistance pursuant to this title with respect to any urban low-rent housing hereafter initiated unless the local public agency has submitted an analysis of the local housing market demonstrating to the satisfaction of the Authority first that there is a need for such low-rent housing which cannot be met by private enterprise; and, second, that a gap of at least 20 percent has been left between the upper rental limits for admission to the proposed low-rent housing and the lowest rents at which private enterprise is providing, through new construction and existing structures, a substantial supply of decent, safe, and sanitary housing; and unless the governing body of the locality involved has approved the provision of such low-rent housing.
Now, if you folks can submit any other language to further safeguard your rights to do the job, you submit it and I will cheerfully consider it in conjunction with the authors of this bill, whom I know will be glad to make it possible to the limit of our ability to give private enterprise full opportunity to do the job.
Mr. FARR. Why go as far as that, all in one step?
Senator ELLENDER. Oh, well, what you want, as I have indicated, is simply, then, you want to be given a chance to do a thing that you
haven't done in 50 years; you want 40 more years to do it; you want to delay it a while longer. That is what you want.
Mr. FARR. Has there ever been a slum clearance bill yet?
The CHAIRMAN. That is what I wanted to ask you.
ber the Federal Housing Act of 1937?
Mr. FARR. The original USHA program?
Mr. FARR. That included public housing.
The CHAIRMAN. It was all public housing.
Do you remem
Yes. What we would like to see is a bill which will really provide a facility for clearing the slums, for land assembly. The CHAIRMAN. Well, we have done that.
Senator ELLENDER. And that is in this bill.
Mr. FARR. But remember, there hasn't been such a bill up to now. Senator ELLENDER. No.
Mr. FARR. I would think the first step in the job of clearing the slums is providing the facilities for doing that. There has got to be an opportunity, in the first place, to assemble the land, plan the development, and then attract capital and builders to do the job. We can assure you that will be done.
Senator ELLENDER. In respect to this proposal would you object to putting in the act some language that would force you to find decent homes for those who are displaced before any money is spent for slum clearance?
Mr. FARR. I think you will find that would discourage materially the type of people you want to get to do the job. You remember we have to encourage people to do this work. We want to get intelligent people who have reasonable business ability to go into it and do these jobs. Senator ELLENDER. Well, you say that would discourage them. How would you provide homes for those who are displaced?
Mr. FARR. I am not suggesting that you go in and wreck the entire city and rebuild it. You have to do it on a piecemeal basis. Senator ELLENDER. You have to plan it, though.
Mr. FARR. You have to plan it; that is right.
Senator ELLENDER. As a whole.
Mr. FARR. That is right.
Senator ELLENDER. Take a certain area and do the job. Well,
Mr. FARR. We are perfectly willing to see that consideration is given to the providing of housing for those in these areas.
Senator ELLENDER. Well, to what extent?
Mr. FARR. But you have got to be careful how you set that up, so that you don't put the man who is going to do the building in a straitjacket and prevent him from proceeding. If you tell him he cannot wreck any buildings, then you mean he cannot even go in and clear one block at a time.
The CHAIRMAN. I want to ask you one question because I am confused. You are talking about you have got to do this and do that. Do you remember the United States Housing Act of 1937?
Mr. FARR. Yes.
The CHAIRMAN. Do you remember what has been done under that? Your organization opposed that, didn't they?
Mr. FARR. That is right.
The CHAIRMAN. What have we done under that act?
Mr. FARR. Well, in Chicago there has been-there were originally three projects built under that act.
The CHAIRMAN. Slums were razed, weren't they?
Mr. FARR. NO. The first project, the Jane Addams project was in a slum area. The other two were on vacant land. The Julia Lathrop was on the north branch of the Chicago River.
The CHAIRMAN. You put some low-income homes in there.
Mr. FARR. They were plain, simple houses.
The CHAIRMAN. But they were sanitarily perfect, weren't they? Mr. FARR. Yes.
The CHAIRMAN. They gave a number of people a chance to live in a decent home.
Mr. FARR. That is right.
The CHAIRMAN. That helped the city, too.
Now, in New York we had a number of them built under that act with Federal Government aid. Do you know Red Hook?
Mr. FARR. No; I don't.
The CHAIRMAN. Do you know Williamsburg?
Mr. FARR. I know of the project, but I am not familiar with it. The CHAIRMAN. There are a number of them where they aided poor people a great deal. We wanted a great deal more of them, but that was done under an act.
You say we have done nothing about those people.
Mr. FARR. I am talking about the facility for assembling the land which can be redeveloped and rebuilt by private enterprise.
The CHAIRMAN. Private enterprise couldn't do that. They told us they couldn't do it. So that we had to go through the United States Housing Administration.
Mr. FARR. Remember this, that the cost of assembling the land in these areas, many old buildings have to be purchased and then wrecked and the cost is much higher than a group of private builders can afford to pay for the purpose of redevelopment. We will say it costs $3 a square foot to assemble land. It is only worth a dollar a square foot for redevelopment purposes.
Under the slum clearance provisions of this act, you do provide for that program, but I say it has not been provided before. We think that program should be started, and private enterprise should be given every encouragement to operate under that program. Let's see what they can produce.
The CHAIRMAN. They had their chance in New York, Mr. Farr. They had their opportunity and they were unable to do it, so that the Government had to step in, and incidentally, we didn't put these poor people living in the slums under the most terrible unsanitary conditions, back in some other slums. We put them in these clean new simple homes, where they are living now.
Mr. FARR. Remember this, that private enterprise hasn't had any opportunity to acquire this land at a price low enough to redevelop. The provisions of this bill will provide assistance from the Government and from the local municipalities to write down the cost of this land to a point where it is economically sound to redevelop it. That is a feature that has never been produced before. We have had slum