Evening star., 1939-02-02
Straus Indorses
Bill 10 Increase
Housing Fund
Congress Reminded
All Of Moneys Have
Been Eurmurked

Administrator Nathan Straus of
the United States Housing Authority
today gave his backing to the bill
introduced by Senator Wagner,
Democrat, of New York, which
would increase by $500, ZOO, 900 the
loan fund of the agency and would
authorize it to spend an additional
$45 5,000,0 900 a year in subsidizing rents
for former slum dwellers.
Reminding Congress that the U. S.
H. A. has made commitments either
through contracts or earmarkings
for substantially all of its funds now
available. Mr.. Straus urged the ap-
preparation of additional funds for
continuing the Governments slum
clearance and low-rent housing pro-
gram. There was evidence also of
increasing pressure being brought to
bear from numerous cities where bad
housing conditions constitute a Sc
rious civic problem.
Opposition Is Seen.
Despite the fact that public hous-
ing has strong support in both the
Senate and House, there were signs
that legislation increasing the loan
and subsidy program by a large
amount would encounter stiff oppo-
sition. This opposition is directed
chiefly at the 60-year subsidy pay
rnents. which, if increased to $45,-
100000 annually, would amount to
the staggering sum of $2,76O, 900 900
as direct contribution from tax
payers to lowering rent levels for a
small proportion of the low-income
group.
In his annual report, just made
public, Mr.. Straus stated that the
maintenance of new construction
activity in 1910 and the opening of
additional completed projects late in
1910 and in 1941 will depend on a
new authorization of funds.
All Funds Earmarked.
Since the United States Housing
Authority now has no additional
funds to earmark" he said, there is
certain prospect of long hiatus
in the housing program when the
projects now under way are COM
pleted unless more funds are now
authorized to start new projects.
1T is equally true that the innum-
cradle cities throughout the country
with serious housing conditions
which have not yet entered the
program, the cities already in the
program but merely making
commencement in their attack upon
their slum problems. and the cities
in the Is States that have not yet
enacted enabling legislation, are all
precluded from initiating or ex-
panding their programs unless more
funds are made available"
BY misunderstanding laid at the
door OF Congress, the U. S. H. A. was
able to make loans and earmarkings
for only about $3.50, 1000, 900 instead of
the $500 100000 authorized in the
act. The loans are made for 80 per
cent OF the cost of the project, the
local community putting up the re-
naming 10 per cent. That would
leave ordinarily S7200O0.OOO which
the U. S. H. A. would loan.
10 Per Cent for Safety.
A 10 per cent margin of safety was
figured into every contract and ear
marking which reduced the actual
amount available for loans to $780,
100000. No doubt after all projects
are completed, this 10 per cent
safety margin will bring back a
considerable amount for other loans
If contract costs are held to mini
mum. Meanwhile, the loan chest is
empty.
The agency has s2S,OOO0Oo for
contributions to subsidize rents.
smaller sum than was anticipated
because the contributions are based
on 80 per cent instead of 100 per
cent of the funds appropriated in
the act. Local communities that
have contracted for projects are ex-
pected to make an annual contribu-
ton also for the reduction of rents,
usually in the form of tax eXemp-
tionS.
BY midsummer Mr.. Straus report