Evening star., 1936-02-14
WAGNER HOUSING
PROPOSAL GIVEN
TENTATIVE FAVOR
Bill to Be Drafted, but No
Specific Plan Endorsed
by President.
WHITE HOUSE PARLEY
COVERS MANY PHASES
Slum Clearance, Loans and Sub.
sides Discussed With Roosevelt
by Senator and Others.
BACKGROUND

B14CkCROUND-
Efforts to effect housing i'm
prouements throughout Nation
haze been numerous during New
Deal administration.
One OF first pas through Home
OUners' Loan Corporation, pro-
piding financial aid to distressed
home otoners. At same time, p. w.
A. undertook slum clearance and
lo,D-cost housing projects while
helping to finance subsistence
homestead agency More recently
Rural ReSettlement AdminiStrd-
ton has attempted social erperi-
ments in housing, and F. E. r. A.
and w. p. A. each haze concerned
themselves NTH housing problem.
Federal Housing Administration
has been one OF most ambitious at
tempts, concentrating on stimu-
lating private construction through
loans to potential builders.
Small degree OF coordination has
eriSted bettCeen oil these efforts.
by the ASSOCIATED freSS.
The White House emphasized to-
day that the 'go-ahead" signal given
Senator Wagner, Democrat, of New
York for the drafting of housing legis-
lation did not represent a presidential
Endorsement for any specific plan.
Mr.. Roosevelt, while interested in
the low-coSt housing problem, de-
scribed the proposal today as still very
much in the preliminary stage.
The Presidents discussion yeSter-
day with Wagner. Secretary Morgen-
thau and Peter Grimm, Morgenthau's
housing adviser, covered slum clear
ance. low-cost housing loans and sub
sides to local communities and an ex-
tended authority to insure loans for
home modernization and repair.
Bill to Be Drafted.
Wagner said he would draft a bill
along these lines and introduce 1t be-
fore March l, for action this session.
He put the Federal cost the first year
at between 100000, 900 and $780,
900 900.
The Wagner bill would stress local
responsibility. Communities them
selves would control and manage the
slum clearance program, the Senator
said. He asserted the Federal Gov
ernment would make both grants and
loans at low interest rates.
Many of the details, including what
agency will handle the vast undertak-
ing, are still uncertain, but these are
the main points:
i. Federal loans and grants to COM
munities to clear slums and erect
better housing.
2. An increase in Government in
surance of mortgages, up to 80 per
cent OF appraised value, to encourage
private construction of housing.
3. Legislation to prolong the Gov
ernment's authority to insure 20 per
cent OF loans made by banks for mod
ernlzation and repair of homes. This
autnorlty is due to expire April /.
Encouragement Seen.
Under the increased insurance for
new home construction. officials said.
persons with small incomes would be
encouraged to build houses. If q man
wanted to own house appraised at
$4,000. he would need only $500 as
the down payment. A bank or other
agency would lend the rest, officials
SAID and the Federal Housing Admin
istration would insure the lender
against loss. The home builder could
nave as long as 20 years to nav.
with no need to renew the mortgage.
Inc present system is similar, except
mat insurance covers only 80 per cent
OF the appraised value, instead of 90.
Thus the down payment on a $4,000
house is 81 900.
Housing Administrator Stewart Nc
Donaid has praised the system as
eliminating second mortgages, ''usury''
In interest rates, bonuses and "ex-
pensive renewal fees"
Secretary Ickes, public works ad-
ministrator, who is directing the pres
ent slum-clearance efforts, told re-
porters he approved of the Wagner
plan "in principle"
Some time ago, Ickes and the Cham
Der of Commerce of the United States
engaged in argument. The chamber
argued the Government should stop
building homes, while Ickes said Gov
ernment aid was necessary because
private capital was not doing the job.