Evening star., 1943-08-08
Way Set for Low-Cost Housing
Built and Managed Privately
By Richard L. Stokes.

must not be imperiled through outlays
involving risk.
The controversy reached stalemate.
Then, as often happens. destiny inter-
vened with solution that was wholly
unexpected. If the war continues until
1916, the Department Of Commerce esti-
mates, there will be backlog In resi-
Dental housing aggregating no less than
$1,000, ,000,000 Thus emerged an oppor-
tunity for investment on huge scale
which was pleasing to both factions Of
the debate.
Contributes 10 Social Welfare.
For insurance officials, the undertake
ing combined free play sof private initi-
ative with maximum security and extern
sion Of life expectancies in urban groups,
as result of better sanitary conditions.
Four-f1fths of the Metropolitan's policy
holders are city dwellers, with death
rate lao per cent above normal. For the
SEC 1t meant capital put to constructive
use. and the diversion of great masses of
savings from the financing of indebted
ness. For both. presumably, it was also
a chance to contribute effectively to So
cial welfare.
Because OF its speculative features,
real estate was long held to be an unde-
sirable investment for insurance COM
panies. They were often forbidden to
own realty except temporarily, under
foreclosure and pending resale. The de-
preston made them involuntary land
lords Of immense tracts of farm and
urban property.
Irresistible factors were at work tend
ing to drive insurance companies and
municipalities to find common ground in
mass housing for underprivileged areas.
The former began to see special i'm
portance in real estate equities as a pos
sible hedge against the imitation irher-
ent in portfolios carrying tremendous in
vestments in bonds. Many cities came
to believe that their existence was men,
aced by the rapidly spreading cancer of
obsolescence in residential districts,
which entailed precipitate declines in tax
receipts.
The disease ragged with especial viru-
lence in New York's slum areas. Less
than-cost transportation impelled whole
sale flights to the countryside, and the
places of the departing families ceased
to be filled by immigrants from Europe.
The site of the future Stuyvesant Town
Is typical. Its population dropped in 20
years from $1,000 to 11,00O. Attendance
at Public School 104 sank from 1,133 In
1880 to SAB IN February of this year.
More than 100 shops are abandoned. A
recent survey indicated that 76 per cent
OF 4,88l dwelling units were constructed
in 1899 or earlier, that So per cent lacked
private baths and AZ per cent needed re-
pairs. Twenty-seven buildings were COM
pletely vacant, and many others were
untenanted above the street floor.
FL Profits Sharply Limited.
Special legislation was required, and
the State of New York made three tries
before arriving at satisfactory statute.
The first was an amendment to the con-
stitution which was adopted In 1898. It
specified low-cost housing and slum
clearance as appropriate purposes for
using the power of condemnation. It
was followed in 1s4l by the urban de-
velopment law, which served as a model
for similar legislation in other COM
monwealths. 1t permitted owners of
equity and mortgage interests in given
areas to pool their assets in redevelop-
ment companies which would be aided by
partial tax exemption over a period of
years and by power to WELD the right of
eminent domain.
The third and final effort was the Re-
development Companies Act of 1912,
under which condemnation proceedings
were placed In the hands Of the city
instead Of the company. In order to keep
land prices within bounds, and whicn
granted tax exemption for rs years on
improvements above the current assessed
value of lands and buildings. In the
case of Stuyvesant Town, the Metropoli-
tan will pay no taxes for quarter CEN
tury on developments estimated at $780,
100000 or more. On the other hand, gross
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