Evening star., 1936-09-16

Greenbelt, the Resettlement
Administrator lo,p-rent housing
project at nearby BerDyn, Nd, is
no,o nearing completion. Within
sir months 1000 families tDil nloue
into their new homes there. This
Is the fourth in a series OF five
articles discussing the social, gop-
ernmental and financial phases OF
the Ne,o Deals experiment.
BY GORDON EAMES BROWN.
IN RELEASE to the press, in con-
versations with newspaper men
and in pamphlets distributed for
i public consumption, the Resettle-
ment Administration has persistently
spoken of Greenbelt as . "self-liqui-
dating" project.
To quote from q recent release:
THE annual income Of Greenbelt
from rentals and other sources will
provide q sum sufhcient to pay back
the total cost Of the project to the
Government over q period Of years"
Unfortunately, this is not true.
Actually, the $7,500,000 investment
cannot be completely liquidated. the
$7,500,000 cannot be completely paid
back to the Government, If rents are
kept at a sufficiently low level to re-
main within the small income brackets.
And Resettlement officials, charged
with formulating this financing plan,
have admitted that some Government
subsidy must be included in that
plan-n the project Is to operate on
a low-rent housing basis.
Necessity Of Low Rents.
The New Deal cannot ignore the
necessity of low rents, nor has 1t any
intention of ignoring 1t. Certainly,
the homes could be rented at rates
high enough to amortize that entire
7,50O, 900 debt over long period,
so years perhaps. But as soon as
high rents enter the picture, the ex-
pertinent fails, the Tugwellian ideals
disappear, and the project becomes
nothing more than q planned. real
estate development. The forgotten
man remains forgotten. -
The importance Of . sensible solu-
ton to the whole financing problem
cannot be overemphasized. at this
writing, Resettlement Is attempting to
work out that problem, one Of many
phases.
Before rents can be set, expenses
must be estimated. Those expenses,
now under careful study and esti-
mate by the administration, consist
of several factors: Cost Of completed
project, town government, town main
tenance, utility operation and plan of
amortization Of this $7,50o,00O. This
last item, the debt repayment plan,
will be directly reflected in the rents
Under the Public Works Administra-
ton financing plan on its housing
projects, the Government gives q IS
per cent grant or subsidy. In other
words, only IS per cent Of the total
cost Is expected to return to the
Government. Most Resettlement ex-
ecutives favor such q scheme for
Greenbelt.
Revenue-P Producing Plans.
Another plan, which would bring
even less cash return to the Govern
ment, is also under consideration. This
one involves repayment of only IS per
cent Of the cost Of revenue-producing
items, not IS per cent Of the total cost
OF the project. Revenue-producing
items include only the land occupied
by the town, some 2,100 acres, instead
of the total originally purchased, some
1900 acres, Of which about $500 were
transferred to the Department Of Ag-
riculture's research center. Such
items also include only utilities for use
of the present town, excluding utilities
extensions constructed for future pos
sib', expansion Of the community into
a municipality Of 5000 families. thrice
its present size.
These revenue-producing items, in
Guiding houses and commercial struc-
lures, excluding streets and sewers,
have cost about $5,500,000. In other
words, Resettlement is seriously con-
sidering repayment of only S. per cent
of $500, 900 instead of full repayment
of the entire Greenbelt cost of ST.
100000.
Under this venue-producing items
only" plan, rents could, of course, be
kept exceedinly low. The less money