Evening star. [volume] (Washington, D.C.) 1854-1972, 1957-02-17
HOPES
BY GEORGE BEvERIDGE

The big lease-purchase Federal
building program. which had been
plodding along with the speed of q
damaged concrete mixer, has begged
down completely. It's collapse, off,
cially called temporary, left q
number Of Washington's hopes in
midair.
The Capital had banked heavily
on the programs success. 1t held
hopes Of constructing needed Gov
eminent office buildings, completing
half finished Federal projects in
the Mall and Federal Triangle areas,
stimulating urban redevelopment
and Kidding the city Of most Of its
eyesore wartime tempos.
One Of Washington's big prob
lems over the years has been the
hack Of real long-range building
program. Lease-purchase seemed
to be the answer. Under the pro-
gram. the General Services Admin
istration was to rent" space in
buildings to be put up by private
investors. At the end of q specified
period, the Government would take
title to the buildings. The total
buying price," in effect, would be
the total Of the installment pay
ments. representing the construc-
ton costs of the buildings, plus
interest. And installment payments
were to come largely from money
the Government now is paying to
rent private Office space.
Off to a Fost Stort
Last year. GSA gave Congress q
firm 10-year building plan-based
largely on leaSe-purchase-to meet
all the Federal Governments per-
manent office needs in Washington
and permit demolition of tempos.
In burst Of activity, the House
and Senate Public Works Commit
tees cleared seven Washington
projects to cost an estimated $166
million. BY last month, GSA had
acquired sites for four of them.
Last week came the GSA and
Post once Department announce
ments Of a temporary deferra1"
on any further bids for actual
lease-purchase construction.
What happened?
Franklin G. F1oete. chief Of GSA,
said the move was in line with
President Eisenhower's policy to
postpone deferrable public works,
and thus hold down "infiationary
pressures" arising from "unneces-
sary competition for labor. mate
rails and equipment"
The record. however, shows there
was considerably more behind the
decision than that.
Representative Jones, Democrat
Of Alabama, q central figure in
handling lease-purchase legislation,
says bluntly that it has proven
most Intellectual"
OF nearly $50 lease-purchase
projects cleared by Congress for
GSA and the Post Once Depart
ment since 1855, only two are at
the construction stage.
But the real shock to the pro-
gram-and to GSA--has been the
apparent lack Of interest on the
part Of builders and investors in
participating at all.
OF GSA's 90 approved projects.
for example, it has solicited con-
struction and financing bids on
nine. Only one. q 81 million
courthouse-post ONCE at Rock
Island. H.. has been accepted.
OF the other eight. two projects,
ut Green Bay. Wis, and Hunting
ton, w. Va. got no bids at all.
Among the other six, no project
got more than two bids for finallc-
ing and construction. GSA re-
jected all the bids Is being too
high.
What's behind this failure? Those
close to the program cite q num-
Der Of factors.
investment Money Scorce
The scarcity Of investment cap
ital generally is one. Dissatisfac-
ton with the maximum I per cent
interest rate GSA wants to pay
in its annual rental" installments
is another.
Mr.. Jones feels q major factor
Is simply that small projects are
widely scattered over the country,
many in small towns. The incen-
tive for investors to search them
out. he believes, just doesn't exist.