Evening star., 1936-01-18
DEFINITE METHODS
MAPPED FOR VAST
HOUSING PROGRAM
ECONOMIC Recovery Group
Holds Mass Production
Would Cut Cost.
MAJOR FINANCING ROLE
UP TO PRIVATE CAPITAL
Government Would Serve Only
in Supervisory Capacity for
Workers Dwellings.
BY JAMES Y. NEWTON.

BY JAMES L. NEW1ONs
Clearly defined methods of carrying
out a Nationwide home building pro-
gram to provide 100000 homes year
for the next 10 years, with private
enterprise accomplishing IS per cent
of the entire schedule, were suggested
to President Roosevelt this week by
the Committee for Economic Recovery.
The committee, composed of proml-
nent manufacturers, hnanciers ana
general business men, believes the
ambitious program would strike a
death blow at depression and provide
millions of families now living in unit
and inSanitary homes with adequate
shelter. 1t suggests sound methods OF
ACCOMPLISHING the objective, with the
Government serving only in super
visory capacity and providing dwell
ings only for groups with family IN
comes below 81 900 per annum.
In addition to aiming at an increase
In adequate housing facilities. the
committee also seeks partial alleVla-
tion of the seasonal employment
evil in the construction industry
through a suggestion that labor pe
guaranteed a reasonable number OF
working days for definite perlods OF
operation. Income to labor, they point
out. has seemed high on an hourly
basis but really is low on a yearly
basis, a condition which should oe
cured in so far as possible.
Price 90 500 to $4,000.
The program would be modelled after
the gigantic home-building plan in
England, with variations to suit con-
ditions in this country. 1t provides
for construction of homes in the price
range of s2,500 to $4,000. To build
structures in this range, obviously
building costs must be greatly reduced.
AS a means toward cost reduction the
committee suggests: More factory pre-
fabrication of the parts comprising
house: larger concentrated volume'
more efficiency in construction on the
site: modern merchandising methods,
and readjustments of methods OF lano
acquisition and usage.
Eve must produce homes" the
committee report to the President
stated, with capacity closely ap-
proximating those built in England,
but including the essential necessltles
of our American life. Our costs under
mass production should not be very
far out of line with those OF England,
even though we do not Immediately
attain all our objectives. But England
did not wait for maximum eff1clency
before starting a real program. Neither
can we afford to delay much longer.
The committee recommended the
formation of a subcommittee OF the
National Association of Home Builders,
which should have as its major pur-
pose the development, in co-operatlon
with the Department of Commerce, OF
ideal types of homes in the price
range described above.
Industry Held Vital.
Asserting that there is no home
building industry, and that develop
ment of one is essential if we are TO
have a successful program. the COM
mittee suggests formation of home
building corporations as a means TO
this end. The report continues:
"As soon as the promotion of home
building has been delegated to the De-
partment of Commerce, plan should
be evolved whereby 40 home-building
companies are formed or, if any are
already in existence, expanded in the
20 largest metropolitan areas. Each
company should have total capital OF
at least one million dollars; executive
direction of outstanding ability;
program of building homes to sell
from $500 to $4,000 in at least three
planned communities in each area.
This will provide for 100 demonstra-
ton projects. Each project should
provide from 200 to 1000 homes. Both
purchase and rental plans should be
included. Rental projects should be
kept separate from communities
planned for home ownership"
Capital for these companies would
be provided in the following way:
A minimum equity capital of S250,000
should be invested in each company
by those interested in the enterprise;
the company should issue debenture
bonds at maximum interest rate of
per cent, or preferred stock at
maximum rate of per cent, while the
bonds should provide for a minimum
sinking fund of per cent annually,
with an agreement to increase the
sinking fund to 10 per cent of the
annual profits; investment bankers
should be invited TO underwrite the
senior issues, while any securities not
sold by the bankers should be under
written by the Recontruction Finance
Corporation. The total underwriting
required under this plan would be
thirty million dollars. Important
business men should act as directors
- 1Cae EOMES pogo a.