Evening star., 1938-11-29


bearing notes secured by the reve-
nues of the properties.
Interest Rate Not Yet Fixed.
Mr.. Ihlder said the A. D. A. notes
referred to by the President as
'bonds'-Would be retired in Is
years. The interest rate has not
been determined. The amortization
of the $6,600,0OO loan will not start
however, until the notes are wiped
out. The latter are not tied up in
taxes.
"The U. S. H. A. feels that these
notes are good security and is con-
fldent they will find ready mar
ket," Mr.. Straus said. It was re-
called that these are probably the
first mortgage notes issued by a
governmental agency in Washing
ton since the days Of Boss" Shep-
herd.
In a discussion of the monthly
room rentals the two housing eX-
ecutives were in slight disagree
ment. Mr.. Straus expressed conf
dence, based on experience, he said,
that the rents would average be-
tween $3.50 and 81. The A. D. A.
executive, on the other hand, ac-
cepted as a challenge" a rental
of mot more than 81 per month -
Both agreed that Washington is a
"high-cost city," presenting difficult
ties in keeping housing costs down.
Commissioner Melvin C. Hazen,
chairman of the A. D. A., was among
those attending the press confer
ence.
The four developments-two for
white and two for colored families
now living in slums which Federal
officials described today as "equaling
IN sordidness and squalor those in
any other American city''-will pro-
vide modern housing for 5000 per-
sons at the lowest possible shelter
rentals.
Cite Vast Need.
According to data supplied by the
A. D. A. in its application for a loan
some 10000 families of meager
means are said to be living in unfit,
unsafe and insanitary dwellings
within the District. Approximately
10000 of these are living in the worst
possible conditions in the Capitals
many defined alley slum areas.
For the new dwellings erected un-
der the new A. D. A. housing pro-
gram, the contract exacts assurances
that an equivalent number of unsafe
and insanitary dwelling units in the
city shall be eliminated in accord
ance with the United States Housing
Act. Only in this way, officials claim,
can there be brought about a gradual
elimination of slum areas.
AS forecast in The Star on Novem-
ber 3, the terms announced today
are in general accordance with the
usual U. S. H. A. form of contract
carrying provisions for direct annual
Federal subsidies to assure low
rentals.
The contract provides annual con-
tributions up to maximum of $685.
760, or not more than 31a per cent
of the total development cost of the
project, over 60year period. In ad-
dition the Federal subsidies are to
be supplemented by contributions
from the A. D. A. in the form of
tax exemption, which will be applied
also in reducing the yearly rentals.
D. The A. D. A. won a concession, it
was said, by being granted the right
to apply these subsidies to reducing
the rents in accordance with family
needs. BY that it is meant, Mr..
1hlder explained, the subsidies will
be applied to the rents of the FAM
flies in the lowest income brackets,
making 1t possible thereby to in
clude a small number of relief
families as tenants. Ordinarily re-
lief tenants are barred from par
ticipation in the Nationwide hous-
ing program.
The initial loan to the A. D. A. is
for less than half of the $4,000 900
earmarked on July / for the clear
ance of some of the city's slum
areas The balance of $8,40O,OOO in
U. S. H. A. funds set aside for local
use will be converted into loan con-
tracts, Administrator Nathan Straus
said today, as rapidly as additional
applications are approved.
The fact that only $500 900 was
announced as the initial loan came
somewhat as surprise to the public
when it was recalled that Executive
Officer John Ihlder had applied on