Evening star., 1933-01-22
SELF-LIQU7DATINC LOANS
FIND FEW ELIGIBLE TAKERS
Restrictions Set Up by Congress Allow
Huge Fund to Remain Idle in
Hands of r. F. C..

light Of probable interest and amortiza-
ton charges.
It is not SO simple as 1t sounds. A
meeting Of engineering minds on de-
tailed estimates Of this sort Is not easily
achieved. What appears to be sound,
-liquidating project to one group Of
engineers may develop serious flaws
There are financial aspects to self
liquidating project calling for some
thing more than mere engineering
ability. The proposition may be per-
fectly sound from an engineering stand
point but insecure from the standpoint
Of financial return. Yet the law re-
quires the r. F. C. to make sure that
the financial phases are thoroughly
sound-that the undertaking will make
a profit and eventually return to the
Government the amount Of the loan,
with interest.
To pass on the engineering phases Of
the projects, the r. F. c. has created
an engineers advisory board, composed
Of five outstanding men of the engineer
ing profession. At present there are
some $50 applications awaiting the ver-
dict of this board. Whether these ap-
plications can hurdle this board will
depend on how well they meet the speci-
flcations laid down under the laws
measuring stick.
The second point to be considered by
a prospective borrower Is whether the
revenues from q project will come from
sources approved by law. A state
project for which the people are to
be taxed, for example, is ineligible to
receive loan. The revenues may,
however, be raised by tolls, fees, rents
or other charges.
Many projects that Congress intended
should be financed by the r. F. c..
are being held up because the appli-
cantS themselves are not authorized In
their own States to apply for q Federal
loan. Loans for low-cost housing and
slum clearance. for forest development
and for publicly-owned bridges are in
this category. Congress restricted loans
for housing and slum improvement to
corporations formed wholly for this
purpose and under State or municipal
regulation. New York was one of the
few jurisdictions having corporations
subject to such control. Many other
States and cities are Fastening to secure
legislation or ordinances which will
meet this provision, however. Similar
regulations are necessary in many
States before forestry enterprises may
R. F. G. Many agencies named as
eligible for self-liquidating loans have
no provision in their charters for OBJ
tanning Government loan. The char
ters must be amended.
Urges Early Applications.
Until these obstacles are removed the
flow of loans is bound to be small, it
is pointed out. According to Mr..
D~I4 Il w.
New York, sponsor of the loan act, and
several other legislators are consid-
ering amendments to the law that win
chinery and men to work with the
spontaneity contemplated at the outset.
Meanwhile the r. F. c. and other
organizations interested in giving the
movement more acceleration are ap-
pealing for loan applications.
Some communities" Mr.. Couch said.
have appointed committees to make
investigation Of all their public works
In order to determine whether or not
there are any repairs or any new pro-
jectS which may be handled at this
time"
The consumation of efforts to amend
the act so as to liberaliZe the loan
policy should not be allowed to delay
applications, he says, for perhaps the
application may receive prompt ap-
proval under existing law
Lawrence M. Conant of Carl Byor &
Associates. New York organization
which has been conducting survey of
the possibilities of reducing unemploy-
ment through self-liquidating projects.
believes that wider realization of the
fact that Federal loans are available
will result in flood of applications.
with the proper display of energy"
he said yesterday. State and local
agencies can get these funds for their
projects, and literally hundreds of
thousands Of men can be put back to
work not only on the projects them
selves but in the mills, mines and
plants that supply raw and finished
materials for construction - to say
nothing Of the railways and other in
dustries that must be called into action
on any great construction activity.
with little encouragement there is
no good reason why 1888 should not see
the self -liquidating project live up to
its reputation as work producer"