Housing is primarily a private market enterprise in the United States. Most housing in this country is privately built and owned and most regulation of that process is done at the state and local level. However, the federal government has played a role for many years in assisting in the provision of safe, decent, and affordable housing for families of modest means. The low-rent public housing program was the original effort through which the federal government supported this policy goal. While public housing is a federally created and funded program, administered at the federal level by the Department of Housing and Urban Development (HUD), the properties are owned and managed at the local level by quasi-governmental public housing authorities (PHAs) under contract with the federal government. Given this unique federal-local relationship, the program is governed in part by federal rules and regulations and in part by policies set at the local level. The program was controversial from the start, with opponents contending that it subverted local control and interfered with private enterprise. Later, criticism grew about the conditions of the housing the program provided. Concern was expressed about the quality of life public housing provided to the families it served, as well as the character of the tenants the program served and the effect public housing was having on the communities in which it was located. Over time, in response to these critiques and others, the public housing model—publicly owned and subsidized apartment buildings for poor families—was replaced with other models of assistance. While no new public housing is authorized to be funded and built, much of the existing stock of public housing built under the original program remains. Today's roughly 1.2 million units of public housing are home to some of the poorest families in the nation, including persons who are elderly, persons living with disabilities, and other families with and without children. In some cases, these families live in high-quality housing in neighborhoods of opportunity; in other cases, these families live in housing that is physically decrepit, socially isolated, and plagued by social ills. The federal government currently pays roughly $6 billion to $7 billion per year to support the remaining stock of public housing and there are differences of opinion about whether this program is a worthwhile federal investment or whether recent funding levels reflect an inadequate federal investment. This report is meant to serve as an introduction to the federal public housing program. It provides information on the history of the program, how it is administered and funded, and the characteristics of public housing properties and the households they serve. While it introduces current policy issues, a full analysis of those issues and discussion of current legislation is not included in this report. In order to understand today's public housing program, and the issues surrounding the program, it is useful to know the background of how it evolved. The following section of this report provides a short history of the public housing program. It should not be considered a comprehensive or exhaustive treatment of the topic. The idea of a federal public housing program began taking shape in the 1930s during the Great Depression. Its purpose was intended to be twofold: the housing created would respond to a lack of sanitary housing available at a low cost to families who had fallen on hard times, and the construction of the housing would lead to the creation of jobs and economic growth. However, the idea of the federal government providing housing proved to be controversial. Opponents saw government involvement in housing as a step towards socialism, the building industries thought that they could handle the nation's housing problems without government intervention, and some local governments were concerned that federal housing would encroach on their sovereignty. The Housing Act of 1937 (P.L. 75-412) attempted to balance some of these concerns in the way that it designed the low-rent public housing program. Under the terms of the act, public housing properties would be built and owned only by state-chartered and locally governed public housing authorities (PHAs). This gave states and localities the right to choose whether or not to participate in the program by deciding whether or not to create PHAs. The federal government would provide capital financing under long-term Annual Contributions Contracts (ACCs). These contracts would spell out the federal requirements of the program; however, many of the decisions about how the housing was designed, where it was located, and who could live in it would be left to the PHAs. Public housing's operations would be sustained primarily on tenant rents, which meant that families would be required to have incomes high enough to pay the rents charged for public housing units. However, in part to prevent competition with the private market, the authorizing statute dictated that families who wanted to live in public housing could not have incomes that exceeded five times the rents (six times in the case of large families). Further, the law required that for each new unit of housing built, an unsafe or unsanitary unit had to be eliminated (a concept often referred to as "slum clearance"). Not long after the program was created, World War II shifted the focus of federal involvement in housing. The Lanham Act of 1940 halted new development under the low-rent public housing program in favor of government construction of housing for war workers. The act also gave war workers priority for existing public housing units. By the end of the 1940s, around 200,000 public housing units had been built and were under contract. The earliest residents of public housing were primarily working class families who were "temporarily poor" because of the Depression. Later, many war workers moved into public housing. As the nation began to prosper again, many families in public housing had income above what was considered to be low income. After being diverted to support the war effort, the low-rent public housing program was restarted at the end of the decade by the Housing Act of 1949 (P.L. 81-171). That act created a federal policy goal of "a decent home and suitable living environment for every American family." It authorized the Urban Renewal program—formalizing the policy of slum clearance evident in the 1937 act—and required communities to give preference for public housing units to families displaced by Urban Renewal. The act expanded the authorization for new public housing units, calling for the creation of 810,000 units by 1954 (or 135,000 units per year). At the same time, the act added new requirements. Out of concern about crowding out private market housing, the act instituted construction cost limits and added a requirement that public housing rents be at least 20% below prevailing market rents for safe and decent housing. Given that upper income eligibility limits were tied to rents (i.e., incomes could not exceed five times the rents), this meant that income eligibility limits would be lowered. Additionally, the act required that the Annual Contributions Contracts be amended to require the eviction of tenants whose income exceeded the limits. While the 1949 act restarted the public housing program, its goal of 810,000 units in six years was not met. The year after the enactment of the 1949 act, President Truman lowered the rate of construction to roughly half the authorized level in response to concerns about materials shortages resulting from the outbreak of hostilities in Korea. Congress followed suit by further lowering the authorized annual level of public housing construction starts each year in the appropriations acts. Also, opposition from local communities made it difficult for some PHAs to get approval to build public housing. As a result, fewer units were built in the 1950s than were envisioned by the 1949 act. By the end of 1957, only about 210,000 of the 810,000 units authorized by the 1949 act were under management. The characteristics of the tenants served in public housing also began changing during this period. The policy changes included in the 1949 act, taken together, would mean that public housing would serve families with income lower than what was originally required under the 1937 act. This change in the income character of tenants is evident in the fact that from 1952 to 1962, the number of families in public housing receiving income from private or public assistance programs rose from 29% to 46%. Further, given that public housing development was explicitly tied to Urban Renewal after 1949, the program began to house more families of color, particularly black families, who had been uprooted and displaced by Urban Renewal. From the beginning of the 1950s to the end, the percentage of nonwhite families living in public housing increased from 36% to 46%. In an era of legal segregation and discrimination, the increasing proportion of black families living in public housing led to great opposition to new public housing development in some predominantly white communities and to the perpetuation of segregation in public housing properties themselves. The 1960s brought a new vision with regard to federal housing assistance. Several new programs were developed to subsidize privately owned rental properties, as opposed to publicly owned properties, including the Section 236 rent supplement program serving low-income families and seniors; the Section 202 program serving the elderly; and the Section 221d(3) program serving families with incomes too high for public housing but too low to afford housing in the private market. Another program, the Section 23 leased housing program, was a new public housing program designed to utilize private market units. It permitted PHAs to lease private market units on behalf of public housing-eligible families. Also, by the late 1960s the Turnkey model of public housing began growing in popularity; under the Turnkey approach, a private developer builds housing on land he owns and then sells the property to a PHA to use as public housing. These new models of assistance, because they utilized private market participants, were thought to be more efficient and timely. Despite the introduction of new programs, the number of public housing units increased significantly during the 1960s to over 800,000 units, an increase from about half a million units at the beginning of the decade. The 1960s brought other important changes for public housing related to the social aspects of the program.