make your State and my State and our country a better country. We try to put the two of them together. I know you will give us every consideration, because we are neighbors, and we visit you and you visit us, and we appreciate it.

Senator CAPEHART. That is all I have.

Senator DOUGLAS. Mr. Mayor, is it not true that while there are some things that are postponable, human needs are not postponable, juvenile delinquency and crime and bad health will continue so that an urban renewal program which reduces and in some cases removes this will eliminate evils that otherwise would go on and in the long run be true economy?

Mayor DALEY. I think you are right, Senator. And it is not only economy, but the true values, the human values, as you pointed outthe necessity of us fronting up to the human values. If we have people living in those conditions in any place in America, that should be our challenge to remove them and to give them better neighborhoods and better living accommodations.

Senator DOUGLAS. Mr. Mayor, I too have been on the receiving end of this economy drive, and I have received 2,500 letters stirred up by one of the Chicago metropolitan papers-and I will not say which one, because I do not wish to advertise it at the moment. Answering those letters is going to cost the taxpayers some $4,000 in added clerical help that I have been compelled to hire.

Let me ask you this question, Mr. Mayor. Is it not true that virtually all the papers, regardless of their political tendencies, support full urban renewal in Chicago?

Mayor DALEY. There has been no dissenion, Senator, or no disagreement on urban renewal. I have never heard anyone in the newspaper fraternity or in any medium of communication or any phase of our society oppose urban renewal. Everyone says it is a good thing, everyone says we should do it. Everyone says we should have done it years ago.

Senator DOUGLAS. But you can only carry this through with Federal appropriations to help State and local appropriations.

Mayor DALEY. That is right.

Senator DOUGLAS. Therefore, the newspapers are not really attacking this feature of the program; are they?

Mayor DALEY. No, they are not.

Senator DOUGLAS. It is simply somebody else's expenditures that they wish to have reduced; is that right?

Mayor DALEY. That is right.

Senator DOUGLAS. Thank you very much, Mr. Mayor. I am going to call on the distinguished member of our committee who formerly occupied the great distinction of a parallel office to yours, Mr. Mayor, Senator Clark, of Pennsylvania, whom you know has been mayor of Philadelphia, the second greatest city in the United States.

Senator CLARK. Mr. Chairman, I would certainly like to commend Mayor Daley, not only for his very temperate and most persuasive statement of Chicago's case, but for the splendid urban renewal program which, I know personally from having visited it, is in midstream in Chicago right now.

I have here, Mr. Mayor, and I would like an opportunity to read it into the record, and then to ask Mayor Daley about it, a telegram which was sent on March 27 to Hon. Dwight D. Eisenhower, Presi

dent of the United States, and signed by 39 or 40 mayors, including the mayor, I think, of every large city in the country, except Los Angeles, and a number of smaller cities, emphasizing what Senator Sparkman mentioned a moment ago.

This telegram resulted, Mr. Chairman, from the hearing before this subcommittee last week, which, unfortunately, Senator Sparkman and I were the only members of the committee able to attend. Six of the leading mayors of the country, headed by representatives of the American Municipal Association and the United States Conference of Mayors, testified that the cutback in urban renewal was in effect killing the Federal program.

After those mayors left here, through the good offices of Representative Hugh Scott, of Philadelphia, Pa., they had an audience with Mr. Cole, and then they went to the White House and saw Mr. Pyle, who is the liaison there for the urban community requirements.

They were discouraged by those interviews, and they sent this telegram to the President, which I would like to read into the record.

As mayors charged with the responsibility of ridding our cities of slums and blight we are genuinely alarmed at the sudden and totally unexpected cutback order by Housing and Home Finance Agency and Urban Renewal Administration and to the equally drastic reduction in budget requests proposed recently. The cut from $250 million to $175 million and the new administrative policy established by LPA Letter 91 threaten to stop completely slum clearance in the Nation's cities. Together they can result only in a complete breakdown of the fight against urban blight. Severe reduction of the urban renewal program will seriously weaken the economy and the whole fabric of our cities. Tens of thousands of American families will be condemned to live in squalid surroundings and our cities will suffer irreparable harm. The drastic reduction in Federal National Mortgage Association assistance to private enterprise under sections 220 and 221 will have a disastrous effect on these important programs.

Your HHFA Administrator recently warned us:

"Any city that does not set in motion by 1960 a comprehensive program to halt blight will be flirting with municipal ruin by 1965."

We agree with Mr. Cole. We are prepared to do our part if the executive branch will give us the help called for by the Housing Act of 1954, one of the landmarks of your administration.

Urban renewal aid to cities is less than one-half of 1 percent of the Federal budget. Economy at the expense of municipal ruin is not the answer to the Federal-budget problem.

One-third of the cost of each urban-renewal project is borne entirely by local funds. The willingness of our citizens to finance the local share of this program is the best evidence of their support for urban renewal.

Knowing your support for this program and your faith in local government, and with our own grave concern for our millions of constituents in 40 cities, leads us to respectfully request a meeting at your earliest convenience to review this policy and to urge that you order LPA Letter 91 rescinded and the go-ahead signal given to communities that want to do a real job of eliminating slums and blight from the American way of life.

Thank you for your courtesy.

It is signed by 40 mayors.

Mayor Daley, in response to a question from Senator Capehart a minute or two ago I understood you to say that you were advocating a return to the $250 million authorization for urban renewal which President Eisenhower had initially recommended. But as I read your testimony on page 5, I come to the conclusion that you are urging a $750 million authorization for a 3-year period at the rate of $250 million a year, on the theory that you need a 3-year authorization in order to do adequate planning. Is that correct?

Mayor DALEY. Senator, you are absolutely right. We would like the continuity of the program to continue, and the more continuity we can have in urban renewal, the more planning we can do in Chicago, and the more we can get done in the neighborhoods and the communities. At the present time I feel that your committee is addressing itself to the immediate question of whether or not it will be cut back from $250 million to $175 million.

Senator CLARK. The initial authorization was for a billion; was it not?

Mayor DALEY. That is right.

Senator CLARK. And it was because you had that large sum and were able to pay it over a number of years that you were able to get urban renewal off the ground in Chicago.

Mayor DALEY. That is right.

Senator CLARK. Would you not think it would be wiser economy in the long run and better administrative procedure to give another large authorization over a period of years, rather than dishing it out in driblets every year?

Mayor DALEY. Definitely; because as has been pointed out we could then have our continuity of action, and we could plan and know and be assured that this would be the amount of revenue that we would receive from the Federal Government in this cooperative project.

Senator CLARK. Thank you, sir. Is one of the gentlemen with you involved in your public-housing projects?

Mayor DALEY. Mr. Bach, our commissioner of planning, and Mr. Downs, our consultant, both of whom have had to do with that, and also Mr. Doyle and Alderman Murphy.

Senator CLARK. I would like to ask you this question. I have a bill, S. 1727, before this committee which would reinstate publichousing authorizations at 200,000 a year as was originally set up in the Taft-Ellender-Wagner Act of 1949. There has been some testimony before this committee that public housing was no longer desired by some cities to the same extent that it was before. On the other hand, yesterday, at a hearing at which unfortunately I was the only member of the committee here, the housing administrator for New York State, Mr. McMurray, testified that New York State needed 25,000 units of additional public housing a year for the next 10 years, 25,000 each year.

When Mayor Dilworth was here, he testified that Philadelphia still needed 70,000 units of public housing and could take them, if we could get rid of the redtape which now surrounds the grant of funds for that, at the rate of 10,000 units a year.

I wonder if you have the view that perhaps Chicago does not need any more public housing, or whether it does, and if so, how much. Mayor DALEY. I believe that there is a necessary part in this overall picture for public housing. We in Chicago need more public housing. Senator CLARK. Have you any rough idea as to how much you could absorb? I am making the basic assumption that we could get rid of some of the present restrictions which make it so difficult, both with respect to income and cost, selection of sites, and the like.

Mayor DALEY. There are many projections made as to what we need and what we do not need. At the present time we have approximately 24,000 or 25,000 units. This year they project we will build

between 3,500 and 5,000 additional units. The need of the city is coupled directly with not only the present need but the projected and estimated need. Some people have estimated that we have need at the present time for 75,000 additional housing units.

Senator CLARK. At what rate per annum could you absorb them with proper administration?

Mayor DALEY. I think probably Mr. Downs would be able to answer that.

Mr. Downs. We have usually taken all of the public-housing units which we could get under the limitations for the State of Illinois. Senator CLARK. Has it been difficult for you to do adequate planning and to get these units by reason of the relatively small amount which has been authorized each year?

Mr. Downs. I think that the Chicago capacity to absorb publichousing units in view of the present law, which we would like to see some amendment of, has been in the area of 5,000 units per annum. This is due to a host of factors with which you are very familiar. But we could carry forward with a continuation of that amount and meet the needs of relocation and other factors that enter into our picture.

While I am speaking, I would like to make an observation on a program of urban renewal at $175 million.

In the metropolitan area slum clearance today it costs $150,000 an acre to do a redevelopment job. That means that it costs $96 million a square mile. That means that $175 million will do less than 2 square miles of urban area in the United States. The magnitude of this program is overwhelming. As a consequence, we have all had to deal in a palliative. When we are talking about $175 million or even $250 million we are spreading it mighty thin, and we are operating with mighty economy in order to do the job at all.

Senator SPARKMAN. May I ask a question there? You do not mean that the Federal Government's part amounts to the figures that you gave?

Mr. Downs. The Federal Government's part would be two-thirds. It would cost the Federal Government $100,000 an acre.

Senator CLARK. Mayor Daley, there has been testimony before this committee from the mayors that we were being urged to raise the Federal contribution to urban renewal from two-thirds to four-fifths, that is to say, to go up to 80 percent. Do you have any feeling about that?

Mayor DALEY. I recognize the desirability of it, Senator, and surely if that could be achieved and accomplished, it would also aid and assist us in our problems.

I also recognize the problem that you are confronted with in putting together the budget, and recognize full well the importance of trying to put your expenditures alongside of your revenue.

Senator CLARK. Mayor Daley, is there much new housing being built within the city limits of Chicago by private builders today?

Mayor DALEY. I would say yes. We have developed in many areas, because of this urban renewal, the great incentive of neighborhoods and communities themselves, such as my own, in putting up individual homes that may be small in number but important, 10 and 15 at a time. We have had Mr. Meegan in the back-of-the-yards district making a

search of the entire back-of-the-yards area that is available for home construction, and surprisingly enough we are seeing new homes being erected in the old neighborhoods.

Senator CLARK. Can you give us a rough idea of the price at which those new houses are being sold?

Mayor DALEY. I think Mr. Downs could give it to you more adequately. I would say $12,000 to $14,000.

Mr. Downs. Well, I think they run from a minimum of about $12,600 to $16,100, thereabouts.

Senator CLARK. Would you agree, Mr. Downs, that roughly speaking, as a rule of thumb, a family can afford to buy a house which costs 211⁄2 times its annual income?

Mr. Downs. I think that is true; yes, sir.

Senator CLARK. So those $14,000 houses would be available readily for families with incomes of $6,000 a year, but not much less.

Mr. Downs. That is correct. That is new housing. Our average industrial work wage today in the Chicago area is fairly close to $100 a week, with three-tenths of a secondary worker per family.

Senator CLARK. Isn't most of this new housing which is being built out of his price range?

Mr. Downs. I would say not to the average industrial worker-that the housing in the $12,900 to $15,000 range, with the three-tenths of a secondary worker which he usually has in his household-that is within his range if the financing is there.

Senator CLARK. Which it is not at present.

Mr. Downs. That is right.

Senator CLARK. But would you agree that families with a total income of $5,000 a year or less are unable, under present circumstances, to buy new housing within the city of Chicago.

Mr. Downs. That is correct. Because when you say families-Senator CLARK. I am talking about the total family income. Mr. Downs. There is the anomoly of our situation that the more the responsibility, the less the rent-paying capacity.

Senator CLARK. Just a couple of more questions and I will be through. As individuals are forced out of your public housing units because they exceed the income maximum, are they able to find decent and sanitary housing to move to as a general rule?

Mr. Downs. Not without substantially altering their family budget. Senator CLARK. I would appreciate it, Mayor Daley, if you and Mr. Downs would have a look at S. 1727, and let us have the benefit of your thinking about it, if possible before the end of the week, when, as I understand it, Mr. Chairman, we are going to close the record.

That is all I have, Senator Douglas.

Senator CAPEHART. I have one question. You do have a lot of $8,500 and $10,000 and $11,000 houses being built in Chicago, do you not?

Mr. Downs. Not within the city limits.

Senator CAPEHART. Outside the city limits.

Mr. Downs. Not too many there.

Senator CAPEHART. About $12,500 within the city limits?

Mr. Downs. We do not think there are any $8,500 houses in our metropolitan area.