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BUILDINGS ERECTED BY THE ALLEY DWELLING AUTHORITY

Mr. FITZPATRICK. How many buildings have you put up during the last year?

Mr. IHLDER. Our act, so far as that is concerned, is divided into two parts, leaving out the defense housing, which is a separate thing. There is title I, which is basically slum reclamation, and title II, which is basically providing low-rent housing. The two things complement each other.

Under title I, we get rid of a slum and build something that is appropriate to that site. Under title II, we can get rid of a slum if the site does not cost too much and is adapted to low-rent housing. Consequently, under title II, where we do most of our work, we have done some reclamation but the emphasis is on low-rent housing, including building on vacant land. Mr. Mandell has the exact figures. Under title I, which is now before you, the emphasis is on slum reclamation, it is to get rid of slums and to redevelop for the use that is most beneficial to the city.

NUMBER OF PROJECTS AND AVERAGE RENT PER ROOM UNDER SLUM CLEARANCE

Mr. HOUSTON. How many projects have you had under slum clearance?

Mr. IHLDER. Only 14, of small size, because we have had less than $1,000,000 to use.

Mr. FITZPATRICK. What is the rent, on the average, per room in your slum-clearance projects

Mr. IHLDER. In the houses for low-income families?

Mr. FITZPATRICK. Yes.

Mr. IHLDER. May I voice my usual protest against giving an average, because averages do not give an accurate impression, and instead give you over a rent range. Our rents range from $9 on one project, where the tenants provide their own heat-$9 per dwelling, up to the economic rent of $39 for a six-room house. This rent includes heat, hot and cold water, gas and electricity.

Mr. FITZPATRICK. What would that $9 dwelling consist of?

Mr. IHLDER. We start with an economic rent. That is a rent which just pays all costs; interest on capital invested, amortization, operation and administration, city taxes. If that rent were paid by all our tenants, the property would be entirely self-supporting, without profit. Then we have a subsidy provided by the U. S. H. A., and exemption from taxes. We use those two things to reduce the rents below the economic level for a portion of our families. By use of the subsidy we grade rents down from the $39 economic level.

Mr. HOUSTON. The question Mr. Fitzpatrick asked you is what you provide for the $9 rental.

Mr. IHLDER. I am making a long jump to that. We go down from 8.9 to $11 on one property, and for that $11 we give a six-room house, light, heat, hot and cold water. On another property, where heat is not included in the rent, we go down to $9. This means that the subsidy makes up the difference between an economic rent and what the tenant pays. This enables us to house some families who are on the relief level. As they increase their income-and a growing numthe rent is correspondingly increased, the subsidy

ber of them do

decreased. We have families whose incomes have increased so they now are paying the full economic rent and getting no subsidy whatever. They are paying every cent of the cost of their housing.

Mr. FITZPATRICK. All your projects, then, are self-supporting, under your program; is that correct?

Mr. IHLDER. That is right; all our properties are self-supporting under our program except for the subsidy by the U. S. H. A. If that subsidy were withdrawn, we would have to raise our rents.

Mr. HOUSTON. Most of these houses are occupied by colored people, are they not?

Mr. ÏHLDER. Yes. The reason is that colored people form a large majority of the low-income population. When the Government clears sites for new office buildings, as it has been doing, or when the A. D. A. reclaims a slum the great majority of the families displaced are Negro. Moreover, there is a serious shortage of housing for Negroes. So we provide for them. It happened, however, that our first two large scale projects were for whites.

Mr. STARNES. Mr. Ihlder, is the Authority still taking houses which are practically slum houses in their nature and improving those, making them more livable for the people at a lower rate of cost than if you were to demolish the entire structure and put up a new house? I have in mind, of course, that you can by that means bring the benefits of this program to a greater number of people in that way? Mr. IHLDER. We have not done as much of that as we wish. We have not done anything of that kind during the last 2 years or more because it would come under title I, and no money has been available.

NUMBER AND TYPES OF UNITS, AND CONSTRUCTION COSTS PER ROOM

Mr. WIGGLESWORTH. Mr. Ihlder, you have given us a statement showing the number of units under each one of your activities, either constructed or that you have under construction.

Mr. IHLDER. Yes, sir.

Mr. WIGGLESWORTH. Have you given us-and if not, will you give us-the construction cost per room in respect to each of the three types of construction, is there is any variation?

Mr. MANDELL. We have that, I believe, on the last page of these tables, Mr. Wigglesworth.

Mr. WIGGLESWORTH. Very well, if it is already in the record.
Mr. MANDELL. Per room and per dwelling unit.

Mr. WIGGLESWORTH. Will you give the same information with respect to operating cost, if it is not already in the record? Mr. MANDELL. Yes, sir.

room.

COST PER ROOM

Mr. IHLDER. May I say one thing in regard to the question of the cost per room? You will find on our table that we have two costs per I want to call attention to that, because there are many different ways of figuring cost. We have tried here to give you a table where costs are comparable. The result is that we have given you a double cost per room. We have always said that a room is a room irrespective of size, so we give you in the first table on this sheet a cost per room of our title I dwellings. We also give you the cost per room of our defense houses. But the U. S. H. A. counts half rooms.

A

half room means the space in a room that exceeds in size the requirements for a room. That is, it makes it a room and a half. So, in order to make all of our figures comparable, we have added a column counting half rooms and put that in parentheses.

Mr. FITZPATRICK. What is the increase in cost per room over last year?

Mr. IHLDER. I have heard the statement made recently that the cost of building has increased 14 percent in the last 6 months or so.

INCREASED COST OF MATERIALS AND LABOR

Mr. FITZPATRICK. Does that include material and labor?
Mr. IHLDER. Yes.

Mr. FITZPATRICK. How much has material increased apart from labor?

Mr. IHLDER. I cannot answer that definitely.

Mr. FITZPATRICK. I think that is very important.

Mr. HOUSTON. I understand the market has dropped in the last 2 or 3 months.

Mr. WOODRUM. You mean on labor?

Mr. HOUSTON. No; on lumber.

Mr. STEARNS. Certain materials have been reduced.

Mr. IHLDER. The price of lumber went up at the time of the construction of the cantonments.

Mr. STEARNS. And then it dropped.

Mr. WOODRUM. That is only one of the materials, however.

Mr. FITZPATRICK. Do you not have any idea how much materials have increased in the last year?

Mr. IHLDER. I do not have the figure in my head.

Mr. MANDELL. About 2 years ago we did have figures showing that labor and material were just about running even at that time; they were a third each of the total contract price.

Mr. FITZPATRICK. I wish you would find out and put in the record, if possible, what the increase in material cost has been for the last year, or the last 6 months, and also what has been the increase in labor.

Mr. MANDELL. We will put those figures in the record.

Mr. BROOKS. I know that there has been an increase in some labor costs in certain particular trades.

Mr. FITZPATRICK. I want an over-all figure, not for any particular trade.

Mr. WOODRUM. You want an average?

Mr. FITZPATRICK. An average for the whole building industry. Mr. IHLDER. Do you not think, Congressman, it would be well, if we can, to give a break-down of those figures, because they have not been even. As has been said, lumber has gone down somewhat, but copper first went up and then it went out of sight.

Mr. BROOKS. We will get those figures and make up a statement for you.

(The information requested is as follows:)

From April 1940 to the present time material costs in the District of Columbia increased approximately 14 percent. Labor costs increased approximately 11 percent.

Foremost in the increase in material costs has been lumber. This increase has been due to the demand in the construction of cantonments. More recently this demand has slackened and a decrease has been noted generally in lumbe

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prices.

The cost of metals has increased and exact cost figures are not obtainable of recent costs. However, the armament program has put almost all metals used in residential construction on the critical list and costs increased to a great extent. As an example, one item used in kitchens increased 30 percent in 3 months and 7 percent within 7 days.

Labor costs have increased due partly to shortages of skilled laborers and mechanics, thus requiring more laborers or mechanics less skilled to do work which would ordinarily be done by fewer trained workmen.

Labor costs have also increased due to increased wage rates. Wage rates for some of the classifications have not increased, while others have increased 5, 10, 20, 50 percent. Fortunately those in the higher percentages have been in those trades which do not have a very great portion of the work. However, a majority of the classifications employed in residential construction have received increased wage rates.

Therefore, the figures given herein represent over-all figures an average for the construction industry in the District of Columbia for the past 18 months.

Mr. WIGGLESWORTH. Mr. Ihlder, I do not quite understand the table that you have referred to. For instance, at Hopkins Place, your cost per room is $860 plus, and a half room is $765 plus.

Mr. IHLDER. Yes. For instance, at Hopkins Place we have said that there are four rooms per dwelling, but those rooms are of a generous size. Using the U. S. H. A. method, there would be four and a half rooms in that house instead of four rooms, and that reduces the cost per room.

Mr. HOUSTON. Is that a one-story house or a two-story house?
Mr. IHLDER. A two-story brick house.

OPERATING COSTS OF HOUSING PROJECTS

Mr. WIGGLESWORTH. Will you give us similar information with respect to operating costs in respect of these three types of construction?

Mr. IHLDER. Yes, sir.

(The information requested is as follows:)

Statistical table reflecting percentages of rental schedules and annual average operating expenses to the development cost for housing properties

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GRADED RENTS

Mr. WIGGLESWORTH. Does the statement stand that you gave us a year ago about your graded rent formula or program, or has there been a material change in that?

Mr. IHLDER. It does. I also have a recent statement on graded. rents that has just been written, which states our position.

Mr. WIGGLESWORTH. Will you put that in the record, Mr. Ihlder? Mr. IHLDER. Very well.

GRADED RENTS

POLICY AND PROCEDURE IN THE DISTRICT OF COLUMBIA

The methods adopted by an agency should be designed to achieve its purpose. The purpose of the Alley Dwelling Authority is to assure that all low-income families in the District of Columbia shall have proper dwellings at rents within their ability to pay. It believes that its job is to meet a need, not to find a market; to help rid the city of substandard housing, not to conduct a safe business; to attack the slums, not to defend its properties from them. Each of its properties is an advance post in an aggressive battle, not a peaceful oasis.

In the effort to achieve its purpose the Authority is ready to take risks when they seem necessary but it seeks to avoid risks by forethought and careful planning. It seeks to have each step lead to the next. The fact that it has won all of its condemnation suits, ending with a favorabie decision by the Supreme Court of the United States, is, it believes, due to this plan of action.

Cooperation given and welcomed.-In its effort to achieve its purpose, the Authority welcomes assistance from other agencies, private as well as public. Whatever anyone else does to help rid the city of substandard housing, to provide good low-rent housing, reduces by so much the burden on the Authority. From the beginning, the Alley Dwelling Authority has publicly offered to withdraw from any slum site which it proposed to reclaim if another responsible person or agency would take over the job. It has sold cleared slum sites to others for agreed upon redevelopment. It has ceased acquisition of vacant land upon the promise of private interests to develop it for needed housing.

Perhaps that is the reason there has been so little publicly expressed opposition to the Authority's program during recent years, the reason all witnesses at a congressional hearing this fall favored an extension of the Authority's powers.

But despite such self-imposed limitation, the Authority has a task that will tax its resources during a long future. Its purpose being to assure good housing for all whose incomes are not sufficient to cause private enterprise to build an adequate supply of proper dwellings, it must provide for a wide range of income. There is tacit acceptance that in the District of Columbia private enterprise cannot build for families with annual incomes less than $2,000. Need for the Authority's service therefore extends from that level down to the level of those who receive public or private assistance. Obviously no single rental would serve families with incomes of $2,000 and those with incomes of $600 or $700. Either it would be too high for those in the lower grades or it would be ridiculously low for those in the higher grades. So the ADA devised its system of graded rents. "Graded rents" defined.-The phrase "system of graded rents" is used because it is designed to be complete, to meet the need in full. The term "graded rents" has been applied in some other cities to a widening of a former single or flat or half-rent to two or three or four rents at different levels. In some cases the purpose of this has been to broaden the "market," to make more families eligible in order that properties may be filled. Incidentally, it has had the good effect of making possible a longer retention of prospering families by advancing them from one rent level to a higher one as their incomes increase, so meeting the United States Housing Act requirement that income shall not exceed five, or six, times rent. But this is not a system; it is an expedient designed merely to ease an impossible situation.

Relationship of public to private housing defined. The Alley Dwelling Authority's conception is that public housing shall complement private housing to the end that all families in the community shall be properly housed. This means that there shall be no gap, no no-man's land between public and private housing. So graduates of public housing may move directly into proper privately owned dwellings.

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