Evening star. [volume] (Washington, D.C.) 1854-1972, 1938-11-03
Alley Authority
Here 10 Take
9096 Loan
Terms Of U. S. H. A.
Agreed To, Droft
Indicates
BY NELSON M. SHEPARD.

The contract for the Districts
$l0,614.o00 initial housing program.
it was understood today, will con-
form to the principle of subsidized
rentals and financing laid down in
the So contracts which the United
States Housing Authority and Presi-
dent Roosevelt already have ap-
proved in So other cities.
This was interpreted as meanino
that the Alley Dwelling Authority
has capitulated to the demands of
the U. S. H. A. and is prepared to
accept 80 per cent loan instead OF
a 100 per cent loan as first proposed
by Chairman Melvin c. Hazen and
Executive Officer John Ihlder.
The houses which are to be built
here under the program are expected
to be reserved for tenants in the low
est self-supportlng income groups,
generally those with incomes ranging
from $500 to $l,100 or perhaps 81 200.
Rentals will be provided, by means
OF subsidies, within the range of
about $3.50 per room a month to
around S6. This would undoubtedly
be below the standard in New York
City and well above the rentals to
be charged in the South and West.
1870 to Cost d. C. s1,O64, 900.
Administrator Nathan Straus re-
turned from Detroit early today and
found ready for him the final draft
OF the revised application submitted
from the Alley Dwelling Authority.
Neither he nor other officials at the
U. S. H. A. were ready to divulge
any official information regarding
its proposals. Mr.. Straus was to
study the draft this afternoon, and
officials indicated the contract would
be drawn up for submission to the
President in short time. The re-
vised application was turned in last
night.
In agreeing to contribute 10 per
cent OF the cost of the project as
other cities engaged in the Nation
wide program are doing, the Alley
Dwelling Authority was informed
it was understood, that there was no
other legal way in which the u. S.
H. A. could sign contract.
A 10 per cent contribution would
81 ,064, 900. Congress had authorized
such a contribution but had made
no appropriation to meet it. The
payment, however, would not have
to be made until the low-rent DWELL
ings are practically completed, at
least a year hence.
d. C. Cash Payment Minimized.
Should the A. D. A. contract. con-
form to others approved under the
United States Housing Act, as in
dications point, annual Federal
subsidy for the purpose of keeping
rentals at a low level would amount
to 81 per cent OF the cost of the
project. The payments the District
government would be called upon to
make would come chiefly in the form
of tax exemption. 1t was believed
the cash payment would involve
very little.
The first indication that the A. D.
A. and the U. S. H. A. had come to
an agreement and ended a months
deadlock was given October 26,
when Mr.. Stratus said he expected
to forward a contract to the White
House within two or three weeks"
Since then he has given orders
for his technical staff to devote as
much time as possible to the A. D.
A. program The fact that he re-
garded it then as "a splendid pro-
gram" was an indication that the
terms were such that the U. S. H. A.
could no longer raise legal objec-
tons as to the methods of financing
or as to the scale of rentals.
Solution Dawned October II.
The break" in the long contro-
versy that had been staged behind
the scenes and in public print be-
tween the two agencies came on
October II, it was learned authori-
tatively.
Mr.. Ihlder had submitted a pro-
gram calling for 100 per cent loan
and utilizing exempt taxes to cut
down the rentals for one-fourth of
the 1920 tenants the A. D. A. pro-
posed to house. Some of these, it
was proposed, should be families on
public relief. Other rentals ranged
UP to SOTO for families with in
comes as high as $1,654.
1t was impossible for the U. S. H.
A. to consider seriously any such
proposal for families in this higher
income group or the upper rent
levels. Mr.. Straus thereupon sug-
gested a conference with Mr.. Ihl-
der, feeling confident a common
ground could be reached,