Box 7, Folder 9, Document 18

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Box 7, Folder 9, Document 18

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Prepared by
,.._m:llma The Housing Staff of
The National Urban Coalition
\
�An Agenda
For Positive Action:
State Programs in Housing
& Community Development
November 1, 1968
A Report Prepared by
the Urban Coalition's Task
Force on Housing, Reconstruction
and Investment
�Preface and Acknowledgements
On July 9, 1968, the Urban Coalition Task
Force on Housing, Reconstruction and Investment met in New York City. At that time the
Task Force members discussed the potential
role of the states in helping cities meet urban
needs.
The discussion soon revealed that a few -states
had begun innovative programs, many of which
show promise of bringing better living conditions
to an increasingly urbanized population. The
Task Force accordingly requested the staff of
the Urban Coalition to draw together and analyze legislative actions that had been taken, and
which cQuld feasibly be taken, so that states considering enacting housing and community devel~pment programs might have guidelines for action. This report is the result of that survey and
analysis, and was prepared with the goals of the
Urban Coalition in mind. The Task Force reviewed and commented on the paper in draft
form and at its meeting on .September 23, 1968,
approved its publication.
The report is intended to enable those in each
_state responsible for administering, recommendmg and drafting housing programs to ask relevant questions and to be aware of possible patterns for :state involvement. The paper describes
an assortment of weapons in the armory of state
action which can be combined to achieve overall objectives. The Task Force believes each of
the tools described in this paper is worthy of serious consideration. It further believes that no ·
recommendations for state action in housing and
community development can be deemed complete without their consideration.
_Although responsibility for the judgments in
this document remains with the Urban Coalition
~ousing staff, helpful suggestions were received
rom many sources. Chief among them were Seylllour Baskin, Esquire, of Pittsburgh ; Ralph
Brown and Michael Herbert, Department of
Colllmunity Affairs, State of New Jersey ; Joel
Cogen of Joel Cogen Associates, New Haven;
Mrs. Glenda Sloane, National Committee
Against Discrimination in Housing; and Stephen
Ziegler, Esquire, of New York City. Each attended discussion meetings and critically reviewed the draft in detail.
Helpful advice, assistance or critical comments also were advanced by: S. Leigh Curry
and H. Ralph Taylor of HUD; Stanley Berman,
Esquire, of New York City; Peter Paul · and
William L. Slayton of Urban America; Professor Daniel Mandelker, Washington University
Law School, St. Louis; Richard Blakley, Illinois
State Housing Board; Eugene Rossland, National Bureau of Standards; James Martin of the
National Governors' Conference; Stephen D.
Moses of Boise-Cascade Corporation; and Warren Lindquist, Associate of David Rockefeller.
In addition, representatives of the Task Force
co-chairmen supplied support and guidance
from the inception of the study: Thomas Hannigan for Joseph Keenan; David Cohen for Walter
Reuther; and Richard Dowdy for David Rockefeller. Jack Davies of the Chase Manhattan Bank
and John Kolesar of the New Jersey Department
of Community Affairs provided valuable aid in
redrafting some of the material.
.
Helpful advice on presentation of the matenal
was received from Commissioner Paul N. Ylvisaker, Mayor Jerome Cavanagh and James
Rouse, members of a special Housing Task
Force Subcommittee which reviewed the fin al
draft.
.
Citations were checked and expanded by
Stuart Stiller.
Two reports previously published : "The
States and Urban Problems," a staff study of the
National Governors' Conference, and a preliminary report ("Action for Our Cities-Part IlHousing" ) of the States Urban Action Ce~ter,
Washington, D. C. , stimulated Task Force thmking at the outset.
�Table of Contents
and
Summary of Recommendations
Page
v
Page
Introduction
II. Increasing Housing Choice
I. Increasingcthe Supply of Low- and Moderate-Income Housing
1
2
2
3
4
5
6
6
6
ii
Program I:
Seed money loans,
technical assistance
and grants.
7
Interest-free seed money loans and technical assistance to
limited-profit and nonprofit developers of low- and moderate-income housing; grants to nonprofit developers of loW·
and moderate-income housing.
Program 2:
State-developed housing.
State-developed low- and moderate-income housing.
Program 3:
Below-marketinterest-rate
mortgage loans.
Below-market-interest-rate mortgage loans to limited-profit
and nonprofit developers of low- and moderate-incorne
housing.
Program 4:
Interest-free loans
to developers.
Program 5:
Construction loans.
Program 6:
Land acquis ition and
write-down.
Program 7:
Rehabilitation housing
acquisition and
write-down .
Program 8:
Property tax
abatement.
Program 9:
Administration.
8
9
Program I:
Comprehensive fair
housing law.
A comprehensive fair housing law establishing a strong enforcement agency.
Program 2:
Metropolitan area
housing information
centers.
Financial assistance to nonprofit metropolitan area housing
information centers to aid families in finding decent housing.
Program 3:
Priority assistance
for integrated
housing.
Priority assistance to developers . which have affirmative
plans to locate, promote and manage their low- and moderate-income housing projects to achieve integrated housing.
III. Improving Building Codes
Interest-free loans to limited-profit and nonprofit developers
to enable them to fall within federal cost limitations on JoW·
and moderate-income housing.
Construction loans to limited-profit and nonprofit develop·
ers of low- and moderate-income hou sing.
10
Program:
Model building code.
A model building code embodying performance standards
for permissive adoption by communities; a building codes
appeal board ; aids for building inspection.
IV. Improving Relocation Assistance
11
Financial assista nce for acquisition and sale or lease of hous.
rket
.
mg sites for low- and moderate-income housing at ma
value or less than market value.
Program:
Uniform relocation
program.
A uniform relocation program to assist communities to pay
relocation expenses and to provide relocation services to
families and businesses displ aced by state or local government action.
V. Equalizing Landlord-Tenant Relations
Financial assistance for acquisition of substandard housing
and its sale or lease at market value or less th an market value
for rehabilitation for low- and moderate-income housing.
. Reimbursement to communities for abatement of normal
' or moderate-income b 0 us·
~roperty taxes on public housing
mg; ~~yments to cover extra public service costs incurred b)'
localities on account of this housing.
Administration of low- and moderate-income hou sing as·
sistance programs.
12
13
13
Program I:
Means to secure
code compliance.
Permit a tenant to institute a housing c~de enforcem~nt ~roceeding, to obtain specific relief for inadequately mam~arned
premises, and to withhold rent to secure code compliance.
Program 2:
Evictions.
Prohibit "retaliatory" evictions.
Program 3:
Private obligation
to repair.
Require that every lease pledge that premises are fit_ to live
in when the tenant moves in and that the landlord will keep
them in good repair.
iii
�Page
Introduction
13
Program 4:
Public housing policies.
~equire local housing authorities to give reasons for evictmg tenants and establish a "Board of Tenants Affairs" for
public housing.
VI. Enhancing Community Development
15
Program 1:
Financial assistance
for community
development programs.
16
Program 2:
Urban Development
Corporation.
17
Technical and financial assistance to communities to draft
proposals for federal program grants.
Eliminte ~onstitutional prohibitions, if any on the involvement o pnvate enterprise in urban affairs. '
Program 6:
Zoning and planning
reforms.
18
A Decent Home and Suitable Living
Environment
Program 5:
Constitutional reform.
18
guarantees to owners of residential property and small
Lo~n
b
usmesses.
Program 4:
Assistance to obtain
federal grants.
18
~n ~rban Development Corporation with state-wide aut onty to combine state and private resources for the improvement of metropolitan areas.
Program 3:
Loan guarantees.
17
Provide a substantial portion of the required non-federal
share of federa~y aided community development programs
a_nd a su~stantial portion of the cost of non-federally assisted projects.
AC
..
_omm1ss1on to review and assess modern techniques of
zonmg an~ land use regulation and to recommend legislation
to moderrnze the state's zoning enabling act.
Program 7:
Improving
design quality.
· o f structures mvolving
.
Excellence in the d es1gn
the use of
nd


ta~e fu s or c_redi~ and the preservation of public buildings


n areas of h1stoncal or architectural significance.
VII. Developing New Communities
19
Program:
Aiding the development
of new communities.
21
VIII. Centralizing Administratio n of Housmg
. and Community Development Programs
P
rogram:
A centralized Department
of Housing and
Community Affairs.
References
iv
New ~ommunity development corporations with eminent
domam powers; deferral of property taxes during development ~eri?d; state approval of new community development
plans m lieu of other land use regulation.
~C~binet lev~l Department of Housing and Community
a'.r~ res~onsible to the Governor, with responsibility for
adm1mstenng a broad range of community aid programs.
At its Emergency Convocation in August 1967,
the Urban Coalition called upon the nation to
t~ke bold and immediate steps to fulfill the nat10nal goal to provide "a decent home and
suitable living environment for every American
family" with guarantees of equal access to all
housing, new and existing.
This goal requires a national effort vastly
larger than anything done in the past. The Coalition set an objective of building or rehabilitating
one million housing units a year for lower-income
families. The National Advisory Commission on
Civil Disorders later recommended construction
of an average of 1.2 million units a year for lowand moderate-income families over the next five
years. The Housing and Urban Development Act
of 1968 set a goal of six million units in the next
decade-an annual average of 600,000 units.
These goals exceed by a wide margin the current annual rate of production of less than 100,000 housing units for low- and moderate-income
families.
Why State Action? State action must be part
of any national program to provide the housing
to meet the very real needs and expectations of
millions of Americans.
The states have abilities and legal authority
unavailable to the other levels of government. If
these resources are withheld from national programs, the federal government, the cities and the
private sector will be seriously hampered in carrying out their roles. If the states apply their
authority and abilities creatively, they can enhance the effectiveness of the other partners in
programs aimed at providing a decent environment for the residents of our communities.
States have authority to assist cities in modernizing governmental patterns and to amend
laws that impede new programs for urban progress. States have great flexibility to experiment
with a wide variety of instruments and incentives
closely tailored to local conditions and requirements. States, moreover, have the capacity to
respond directly to urban problems as they arise,
and to work with cities in supplementing federal
and local programs and to adapt them to the individual challenges each city faces.
A few states have already enacted their own
housing and community development programs
covering a wide variety of problems. But these
programs are not as well known as they should
be at a time when many states are seeking new
avenues through which -to enlarge their assistance to local communities to improve the quality
of housing and community facilities.
The Purpose of This Report. This report on
possible state programs has been prepared by
the Urban Coalition's Task Force on Housing,
Reconstruction and Investment as a guide for
those in the public and private sectors concerned with greater positive action by the states
to assist cities in housing and community development.
The programs for state action outlined here
are designed to meet problems which fall into
eight categories:
V
�I
I
I.
II.
III.
IV.
V.
VI.
VII.
Increasing the Housing Supply
Increasing Housing Choice
Improving Building Codes
Improving Relocation Assistance
Equalizing Landlord-Tenant Relations
Enhancing Community Development
Developing New Communities
VIII. Centralizing Administration of Housing
and Community Development Programs
Programs in each of these categories are prefaced by a brief statement of needs and potentials
in the area. And federal programs are related to
state programs where a relationship exists.
The programs cited are designed to spur swift
and effective action. This report does not envision establishing at the state level another set of
complex administrative requirements alongside
the existing federal regulations. To the greatest
feasible ex tent, where states supplement or relate to federal programs, the federal appro val
should be the principal criterion to obtain the
additional state aid. Duplicating and possibly
conff,icting state requirements may only delay or
frustrate needed action.
Cities have built up a body of experience dealing with federal aid procedures, however complicated these rules may be. States must master
the same procedures before they can work effectively to improve them. A state administration
truly intent on helping cities thro ugh these programs will develop its own experienced and
capable staff. It will, consequently, -find its voice
significantly strengthened in shaping -the course
of federal action. Strong voices are indeed
needed, because in the last analysis increasing
the effectiveness of federal efforts, backed by the
far larger potential financial resources of the
federal government, will prove crucial. States
should join with their cities in working to channel these resources into urban needs.
Except for a suggested commission to revise
complex laws for zoning and land use, no proposals are made that require extensive research.
A suggestion is advanced for centralized state
administration, but with one exception, no at~
tempt is made here to deal with long-range con~titutional or fiscal reforms. Though such organic and fiscal change is unquestionably vital, to
maintain a sharp focus this report concentrates
on specific measures which can be readily taken.
Indeed, most of th e measures described are already being undertaken in some form in one or
more states.
In ~an_y states constitutional li mitations may
make it difficult to enact some of the provisions
vi
described here. States with restrictive constitutions are, however, already undertaking many
of these programs by the use of responsible and
imaginative legal counsel, financing devices and
careful draftsmanship. Before a sensible course
of action is piscarded because of assumed constitutional difficulties, the statutes of other states
should be carefully e?(amined for possible solutions to the constitutional problem.
The primary objective of the majority of these
programs is to attract greater federal aid-to
bring in several federal assistance dollars for
each state assistance dollar. A number of the
programs also act to attract wider private sector
involvement and to overcome legal and political
impediments to swifter and more effective progress. In many cases, state assistance can be seen
substantially to improve the scope and efficiency
of federal and private programs.
No model legislation for these programs is included since such legislation must necessarily be
drafted to fit the circumstances in each state.
However, citations to existing state programs
and other relevant sources are given in the references at the end of this report. These citations
are intended to be illustrative rather than exhaustive. The staff of the Urban Coalition is prepared to provide further information and assistance to those interested in carrying out any of
these programs in their states.
E ach state is urged to review these suggested
programs carefully within th e fra mework of its
own needs, priorities and resources. The programs outlined here could be combined or considerably altered to fit particular circumstances,
and there is still certainly a great need for experimentation . Each housing and community development project, moreover, should be related to
an ongoing local or metropolitan comprehensive
planning effort. Ideally, each state should seek
to combine new concepts and existing programs
into a well-coordin ated and effective effort.
It is a time to decide. It is a time to act. To
justify the role of the state as an innovatora laboratory for imaginative approaches to
urban problems-state leaders must dramatically increase state assistance to urban communities.
Enactment and adequate funding of a com·
prehensive state housing and community de•
velopment program which in some measure
includes the specific programs described in this
report would dramatize an important commit•
ment that states could make to their own
people.
I. Increasing the Supply of Low- and Moderate-
Program I
Income Housing
Interest-Free Seed Mo ney Loans and T echnical Assistance to Limited-Profit and Nonprofit
Developers of Low- and Moderate-Income
Housing; Grants to Nonprofit Developers of
Low- and Moderate-Income Housing.
,
Federal and state low- and moderate-income
housing assistance programs rely heavily upon
.
nonprofit housing sponsors. *
Nonprofit housing sponsors are e1the_r bro~dly-based housing development corpo_rat10ns _aiding or sponsoring a number of ho~smg proiects
in the community or individual proiect sponsors,
such as churches, charitable foundations , se~tlement houses, labor unions, fraternal orgaruza.
tions and other civic-minded groups.
As landlords or as organizers of cooperatives,
these groups are likely to follow enlightened policies. As sellers, they are likely to help lowerincome buyers adjust to homeownership. Th_e social motivation of many nonprofit corporations,
moreover, causes them to undertake t_he_bften
risky, tedious and difficult task o~ bu1ld~g or
rehabilitating housing in inner- city . or gray
areas " where many private profit-motivated de' will not enter.
velopers
Experience has shown, however, t_hat to?
many nonprofit groups are long on social dedication but short on money and skills. Thus, ~he
difference between good intentions and hous'. ng
in place is often assistance to nonprofit housmg
corporations in the forms of:
-seed money loam, (advances from a revolving loan fund needed to cover initial
costs, such as preliminary architectural fees,
engineering fees , site options, tenant surveys, market analyses, and legal an_d organizational expenses during the project development stage, which are recoverable
from the proceeds of the FHA-insured
mortgage ) ;
.
- grants for administrative costs, social services and other necessary expenses whic~
are important to the success o~ the organization and the project, but which may not
be recoverable fro m the mortgage proceeds;
-interim fina ncing ( construction loans
needed when private construction loans are
not available as described in program 5
below) , and
- technical assistance (expert aid needed to
train personnel, develop projects, se_cure
project approval and oversee construct10n).
• A used ;,, this paper references to 11011 profit deve lopers or n~npro{it sponsors include nonprofit cooperatives as well as ot er
non profit entities.
�/
The availability of grant money is particul arly
important to housing development corporations.
These broadly based nonprofits need start-up
and operating money that will not be recaptured
from the proceeds of housing project mortgages.
Seed money loans interim loans and technical assistance might also be made available to
limited-profit housing developers in need of this
assistance.
The federal Housing and Urban D evelopment
Act of 1968 (hereafter the 1968 Housing Act)
provides similar assistance to nonprofit developers of low- and moderate-income housing. It
directs the Department of Housing and Urban
Development (hereafter HUD) to provide information , advice and technical assistance. It also
authorizes HUD to make 80 percent interestfree seed money loans to nonprofit corporations
from a small, newly created revolving fund. It
creates a government-chartered, nonprofit, private corporation known as the National Homeownership Foundation to encourage private and
public organizations to provide increased homeownership and housing opportunities fo r lowand moderate-income fa milies.
A state assistance program, however, would
provide an additional and more flexible source
of aid to developers of low- and moderate-income housing. A state program could be used to
give encouragement to the form ation of limitedprofit and nonprofit housing groups within the
state, when federal assistance is not available.
A state program, moreover , might put more
emphasis on making non-recoverable grants,
rather than recoverable seed money loans-the
thrust of federal aid. Grants, rather than loans,
are needed to help finance housing development
corporations and pay fo r the extra costs of housing low-income people, such as the provision of
important social services.
Program 2
State-Developed Low- and Moderate-Income
Housing.
Developing housing for low- and moderate-income families requires a great deal of expertness. The services qf a lawyer, real estate agent,
builder, banker and administrator at a minimum
are generally required. In many smaller communities it is difficult to find people who are both
qualified and willing to render these services to
a housing sponsor.
Thus, as a logical alternative to state or federal
technical assistance to help local groups become
qualified to develop housing projects, the state
may wish itself to develop either public housing
2
or moderate-income housing. It should only do
so where there is no functioning local p ublic
housing authority or moderate-income housing
developer to build the housing.
To produce public housing, the state would
establish a public housing authority which could
provide the necessary public housing anywhere
in the state. R ecent changes have added great
flexibility to the federally assisted public housing
program. A public housing authority can now
lease as well as bu ild or purch ase housing, and
can sell the housing to its tenants. State-wide
public housing authorities are eligible to receive
federal public housing assistance.
To build moderate-income housing, the state
could create a nonp~ofit housing development
corporation to develop this housing anywhere in
the state. The corporation generally would serve
as developer of the project. It would only serve
as sponsor (i. e., the owner and maintainer of
rented housing) in the absence of a local group
which could serve as th e sponsor.
In developing either public hou sing or moderate-income housing, the state would act in
close cooperation with local public and private
groups. And the state would not itself construct
the housing; construction would be done by a
private contractor under the " turnkey" system.
Program 3
Below-Market-Interest-Rate Mortgage Loans to
Limited-Profit and ·Nonprofit Developers of
Low- and Moderate-Income Housing.
States may use their power to borrow cheaply
through the issuance of tax-exempt bonds to finance moderate-income housing projects at
mortgage interest rates several percentage points
below commercial rates. On long-term mortgages (usu ally forty years) , this lower interest
rate can be of substantial assistance in reducing
the cost of housing. New York pioneered this
assistance with its highly successful "MitchellLama" program.
F ederally assisted moderate-income housing
programs also aid the production of housing by
reducing interest rates. The FHA section 221(d)
(3) program, for example, provides fin ancing at
a three percent interest rate. Nevertheless, at
least five states have enacted their own belowmarket-interest-rate programs to supplement the
federal programs.
There are many good reasons for states to
establish their own below-market-interest-rate
housing programs.
Com prehensive Program. A state agency may
find it difficult to undertake a comprehensive
Substantial reasons still remain, however, fo r
program fo r encou raging the development of
moderate-income housing without itself being states to make supplemental loans to developers
able to assist in the mortgage fin ancing of this to enable them to qu alify fo r federal assistance
housing. Without its own below-market-inte_r<:st- when they otherwise would not.
The FHA and the Housing Assistance Adrate mortgage program, the important decIS1on
(HAA) continually have under conministration
of whether to fin ance a proposed housing projproposals
for housing projeots which
sideration
ect would be made exclusively by th e Federal
or
fo und infeasible because
have
been
slowed
Housing A dministration.
proposed
costs
exceed
maximum fe~er_al ~ost
Flexibility . M any FHA programs can only be
limits.
In
many
cases
federal
cost hm1tat1ons
used to assist housing developers in communisimply
may
not
adequately
re~ect
lo~al cost facties which have enacted . a "workable program
might,
for. extors.
Costs
per
unit
for
a
proiect
for community improvement"- an overall plan
ample, exceed the federal maximum by as little
of action for meeting problems of slums and
blight, and for guiding community development. as five to ten percent; yet, as the ~evelo? er
This "workable program requirement" greatly spends perh aps months redesigning ~1s ?roiect
restricts the use of important FHA programs in to bring unit costs in line ( often sacr~cmg demany states where such a program has not been sirable design features in the process)'. m~reases
in construction costs during the redes1gnmg_ peadopted by a locality. A state program would not
riod might well consume wh atever other savmgs
be subj ect to this restriction.
The FHA allows a maximum six percent book were managed. This tedious proce~s causes many
units of badly needed housing to die on the draftreturn to limited-profit housing developers. To
. il
encourage greater participation, a state program ing boards.
State assistance can remedy this and s1m ar
may allow a greater maximum return , such as the
cost problems. To reduce th~ t~tal fed_eral morteight percent return allowed under the New Jergage assistance amount to w1thm m~x1mu~ fedsey program.
.
eral cost limits, the state could provide an mterL essComplexAdministration. FHA processmg
est-free loan to the developer of up to t~n percent
of moderate-income housing proposals is comof his cost to supplement his FHA-msured fiplex and generally time-consuming. An adenancing. R epayment of the state loan would ~e
quately staffed state program may be able to
deferred until after the fed eral mortgage loan is
simplify its rules and regulations and thus spee~
.
processing time. And based on its own expe~I- ·paid off or refinanced.
The state loan is secured by a state lien on the
ence, it may be able to suggest .improvements m
project. T he loan is subordinated t~ the FHAFHA regulations.
insured mortgage. It becomes a first hen af~er the
Experim entation. States may wish ~o i_nnovate
with their own programs, such as Ilhno1s, M as/" . M sac/111setts and N ew Jersey also
sachu setts and New Jersey are doing with "rent • To lower rents, II m o,s, b -:;-' programs to pay the di ffe rence
~~"~\ ~om_e family can afford to pay
skewing." Through rent skewing, rents in a 143.215.248.55,~e:~a~;:etd : :~:,,,~~n!
state-assisted pro1ects.
and the ren s o n
'
may wish to delay initiating rent supmajority of apartments are raised slightly_ to
Other states, howe'r~[· they see how two new sections of the
plem ent programs un 1
••
low larger reductions in the rents of a mm~nty
· A ct are adnumstered.
b
68 H
19Secti;:s143.215.248.55(b) allows f';deral rent supplem ent payments to e
of apartments. R ent skewing allows a wider
.
. t made t_o st~~6't/if~r,~::;0 ;,~;t~;ew fe deral interest reduc tion pa?;range of tenants' income~ in a hous'.ng f roi ec
Sect,onb
de for state-assisted housing. These payments_ w1 I
m ents to e ma
b t ee n normal rents on a state-assuted
th an would be possible without skewmg.
ma~e up the dlfferenc{ ,:h;; ,. tenants can afford to pay ii they


u-


pro1ect and the re nta_ s ·ncome for rent . Tir e paym ent cannot ex-
P rogram 4
Interest-Free Loans to Limited-Profit and Nonprofit Developers to Enab le Them to Fall Within
Federal Cost Limitations on Low- and Moderate-Income Housing.
Federal programs have almost excl u_sively assisted housing by reducing fin ancmg costs
through mortgage lo ans, mortgage in_surance and
interest subsidies. T he 1968 H ousmg Act ex~
pands these programs. Due to th e ex istence of
substantial federal ass istance some states ~ ay
not wish to engage in the same form of assistance. ( As desc ribed in P rogram 3 above.)
pay 25 percent of 1•.e~ 'vo11ld lower the effective interest rate on
ceed an am ount w uc , 'd I om the rentals to less than one perthe project mortgage pa, r
cent.
. .
f state m ortgage loan and federal rent
Th ese comb1'.1at1ons :eduction payments give pro mise of lwussupplem ent or mtere~t
in state-assisted housing.
Ing families of low m co;"e ver that in many cases the state
Jt does not appear, ,owe t ~ e loan and the federal in terest
below-mark et-interest-ra!lel m ar bg ·,g,e to reduce rents below the
.
. tance w, com ,
.
d
reduction ass1s
I the m ortgage were FHA-msure at
amount _they would be di ti e fe deral program , and not statemarke t-mterest rates un er 1
1 1 arket-in terest rates.
. 11
assisted at b e O H- m
0 m ent m ay not exceed the
T he federal interest"i:e!~~f'~teJ' t~ pay under the mortgage"
amount a m ortgago~,
Id b! obligated to pay if the m ortgage
and the am o unt he ,!vo~t ti e rate of one percent. To the ex tent
we re to bear inte~es! ~
' federal assistance com es into play .
this one percent l1111k1tat1? 1t1 orenst-rate m ortgage loan wo uld simply
.1 re below-m ar e t-Ill e
I
t ,e ., a
f d I b itli• by lowering th e am ount the mortgagor
'i,,
reduce the e era ·"'.,
the absence of the state below-market"is obligated to pay. 1
the federal government would make
interest-rate mortgage ,oa,b,, . of FHA -insured market interest
higher payments on t ,e
rate morgage.
as,s
3
�financing of federally insured housing for lowand moderate-income families. This action was
instrumental in clearing the backlog in Illinois in
221 (d)(3) housing.
As of October 1968, $288 million were allocated to qualifying banks in proportion to ,their
outstanding loans. Additional sums for time deposits have been made available where needed
by banks to meet special public needs. Those
varied needs have included programs other than
housing.
The Illinois plan involves no sacrifice to the
state of earnings on its investments, or greater
risks of loss.
Where this state stimulus is not possible and
construction financing is difficult to secure, states
might make or participate in providing interim
construction loans at below-market-interest rates
to developers of low- and moderate-income
housing. A state could borrow its loan money
through the sale of tax-exempt bonds and establish a revolving loan fund. Since construction financing is short-term, such a revolving fund
would have a rapid turnover. Thus, a limited
amount of money could finance a large number
of projects. No net cost ,to the state would be
incurred, and a state could in fact earn a sum on
its Joans sufficient to pay borrowing costs and
the costs of administering the program.
FHA-insured mortgage is paid off. (FHA has indicated approval of this type of state assistance
since_ t~chnically it does not constitute currentl;
proh1b1ted secondary financing.)
The state loan is well secured. Even were the
improvements on the property to be depreciated
completely by the end of the FHA-insured mortgage period, the land would still remain to secure it.
The small state loan brings high returns. If the
state w~re, for example, to finance ten percent of
the proJect cost With its supplemental loan, the
state loan would call forth ten times its amount
in private and federal investment.
Program 5
Construction Loans to Limited-Profit and Nonprofit Developers of Low- and Moderate-Income
Housing.
The recent tight money situation and the general
shortage of long-term mortgage financing in
some areas have hampered the development of
low- ~nd moderate-income hom;,ing. Despite a
commitment on the permanent financing by the
federal government and in some cases FHA insura~ce of the interim construction loan, conventional loans have often been unavailable to
finance the construction of housing in the interim
period before the permanent financing takes
place.
When interim construction financing is available for lo:V- and moderate-income housing, the
~eveloper is often required to pay high rates thus
mcreasing housing costs.
'
The shortage and high cost of short-term construction financing can thus be a substantial
bottleneck to the production of large amounts of
low- and moderate-income housing.
State authority to invest millions of dollars of
cash resources not immediately required for expenditure provides leverage to encourage banks
to meet public objectives.
In January 196 7, the sta:te of Illinois announced a Sta~e Investment Program to forge a
new partnership between the public and private
sectors-between public treasuries and private
ba~s._ The_ program was implemented through
adm1mstrat1ve action by the state treasurer.
Under this program deposits of state funds
are made in banks agreeing to make interim financing available for construction of low- and
moderate-income housing. Working with FHA
and several banks in the Chicago area, the state
agreed to deposit, at competitive interest rates
about $90 million in those banks which in tur~
were willing to invest equivalent sums for interim
4
Progra1n 6
Financial Assistance for Acquisition and Sale or
L ease of Housing Sites for Low- and ModerateIncome Housing at Market Value or L ess Than
Market Value.
..
A state program of assistance for land acquisition can: (1) increase the incentive of limitedprofit developers to construct low- and moderate-income housing; or (2) help assemble large
housing sites and, where justified, lower the cost
of housing by writing down the cost of the land
through its sale or lease to a nonprofit housing
developer at less than fair market value.
(1) Increasing the incentive of limited-profit
developers to construct low- and moderate-income housing.
Nonprofit housing sponsors alone cannot
build or rehabilitate six million houses in the
next five years. The private developer can produce a large share, either by building "turnkey"
public housing (public housing developed by a
private developer rather than the local public
housing authority) or by operating as a limitedprofit sponsor developing low- and moderateincome housing. Since 1961, when FHA assistance for moderate-income housing began, 42
percent of its projects have been built by limitedprofit sponsors and 58 percent by nonprofit
sponsors.
As a limited-profit sponsor the private developer is allowed a regulated return before taxes
on its equity investment in a housing project. In
FHA programs this is usually six percent. With
the benefit of early writeoffs and other favorable
investment factors to which a developer is entitled under the law, he can substantially increase
his after-tax return above this amount.
Yet even with the favorable rate of return
presently allowed under the law, only a small
number of units of low-r,isk, moderate-income
housing projects have aotually been built by limited-profit developers, principally at times when
other construction business has been slow.
To increase the incentive for a limited-profit
developer to build low- and moderate-income
housing, states could leverage the federal program by financially assisting communities to purchase land and to lease it to a developer at favorable terms without loss to the states or the
municipalities. Land purchase and lease frees
the developer from investing substantial capital
in land, which cannot b_e depreciated, and substitutes an annual rent on the lease which is a
deductible expense, thus increasing his after-tax
return.
Such land purchase and lease would also
lower the cost of housing by enabling lower sales
prices or rents.
States may be able to obtain the money
needed to help municipalities purchase and lease
land by floating state-guaranteed, tax-exempt
bonds which are repaid from rent receipts
under the lease. The financing is analagous to
state financing of industrial parks.
(2) Assembling land and ·reducing the cost
of low- and moderate-income lwusing .
The increasingly high cost of suitable land in
metropolitan areas is a major factor in boosting
housing costs beyond the reach of low- and moderate-income families.
The federal government does not provide
financial assistance in writing down land costs
for housing except in urban renewal area ,
which, for the most par·t, have been in the central city. Section 506 of the 1968 Housing Act,
however, now allows federal assistance for
"write downs" of open land in declared urban
renewal areas for low- and moderate-income
housing. But designating urban renewal areas
and receiving federal funds is a long and cumbersome process, involving more than writing
down land costs for housing projects.
Additional state assistance to communities
5
�j
assembling and developing land for low- and
moderate-income housing outside of urban renewal areas would give substantial aid to the
large-scale production of low- and moderateincome housing. By use of the community's
eminent domain powers, large tracts of land
could be assembled. With state aid a municipality could sell or lease the land at less than market
value to nonprofit developers where the write
down was to be reflected in lower rentals or
sales prices.
Program 7
Financial Assistance for Acquisition of Substandard Housing and Its Sale or Lease at
Market Value or Less Than Market Value for
Rehabilitation for Low- and Moderate-Income
Housing.
Systematic rehabilitation of housing in the core
or "gray areas" of cities is an important part of
the nation's housing program. The federal assistance needed to clear these areas for the development of new housing is greater than is likely
to be made available in the foreseeable future.
Even if the money were available, •the dislocation
and disruption involved in clearance and reconstruction would weigh heavily against total reliance on c;learance as a renewal instrument.
Of the six ml'llion standard houses that the
Department of Housing and Urban Development sets as a production goal, two million ( one
third) are intended to be rehabilitated structures.
Housing rehabilitation could be increased
greatly if the states were to help municipalities
purchase substandard houses and resell or lease
them to nonprofit developers which would rehabilitate them for sale or rental as low- and
moderate-income housing.
With state aid a municipality could sell or
lease the substandard houses at less than market
value where the write down was to be reflected
in lower rentals or sales prices.
In addition, a judicious use by a locality of its
power of eminent domain would enable a systematic rehabilitation of all declining properties
in a neighborhood or on a block, rather than the
rehabilitation of only those houses which are on
the market, as is now generally the case. This
systematic rehabilitation has a greater effect in
upgrading entire neighborhoods.
Program 8
Reimbursement to Communities for Abatement
of Normal Property Taxes on Public Housing or
Moderate-Income Housing; Payments to Cover
6
Extra Public Service Costs Incurred by Localities on Account of This Housing.
Under the federally assisted public housing program,communities are required to abate real estate taxes on the project. They receive a payment in lieu of taxes of approximately ten percent of the rentals of the project. This reduction
of tax income to communities has proven to be
an important barrier to the production of public
housing. State payments to make up the difference between what the public housing pays in
taxes and the normal tax bill would help communities to provide needed public housing.
On the other hand, local property taxes often
account for between twenty arid thirty percent of
the rents paid by occupants of FHA-assisted
moderate-income housing. These projects are
usually taxed as though they were conventional
apartments even though the rental income they
produce is limited by FHA. State payments to
communities to reimburse abatements of normal local property taxes on federally and stateassisted housing would be a potent device to
lower rents.
An additional barrier, even if full taxes are
paid by or on behalf of low- and moderateincome housing projects, is the higher cost of
public services for occupants of higher density
housing, e.g., schools, playgrounds, social services.
State payments to communities in excess of
local taxes to meet these extra costs would provide an inducement to communities to accept
low- and moderate-.income housing. This inducement would assist in locating low- and moderate-income families outside central cities,
closer to places of expanding employment. Gearing these payments to an industrial development
program would help relieve labor shortages
which increasingly inhibit economic growth of
outlying areas.
Program 9
Administration of Low- and Moderate-Income
Housing Assistance Programs.
States administer housing assistance Programs
one through eight in varied ways. A pattern of
clustering programs designed to encourage the
construction of low- and moderate-income housing-seed money loans and grants, technical
ass istance, construction loans, tax abatementaround the core program of making belowmarket-interest-rate loans to developers has,
however, emerged in several states .
These programs are then either administered
directly by the state with the below-market-
interest-rate loans being made from a housing II. Increasing Housing Choice
development fund . Or they are administered by
a separate public benefit corporation, sometimes
called a Housing Development Authority or
Housing Finance Agency. State constitutions
may well dictate this choice.
The important factor in administering these
programs is to assure that one responsible
agency has the authority to combine them imaginatively.
For example, a state seeking to increase the
production of low- and moderate-income housing and homeownership by low- and moderateincome families, might administer each of the
first eight assistance programs described.
The state could make seed money loans or
grants and give technical assistance to help establish sponsors.
.
It could help finance projects by makmg construction loans and permanent mortgages to developers. And it could make additional loans to
lower the costs of projects which exceeded FHA
maximum cost limitations.
Where sponsors did not exist it could develop
projects itself.
It could assist. communities in purchasing and
leasing housing sites or houses for rehabilitation. The sales or leases could either recover fully
the state's costs or, if needed, could assist the
project by recovering less, i.e. , by writing down
the land.
·. f
It could help to reimburse commumties or
abated taxes where needed.
And in addition to the first eight programs,
the stat~ might be given some unearmarked de_monstration funds to devise new ways of meetmg
its housing problems.
For example, using demonstration money, the
state might:
-make equity loans to developers of ~ooperative housing to enable moderate-mcome
families to purchase their houses on a cooperative basis with a minimal down payment and liberal financing of the balance Program 1
A Comprehensive Fair Housing Law Establish.
over a period of years, or
- establish a rent assistance program to fill m ing a Strong Enforcement Agency.
gaps in federal programs whereby houses
The landmark June 17, 1968, Supreme Court
would be purchased or leased by ,~ e state
decision, Jones vs. Mayer Company (20 L.Ed.
and then leased or sublet to low-mcome
2nd 1189), interprets an 1866 Civil Rights law
families at reduced rentals.
(guaraillteeing to all citizens the right "to inherit,
To fin~nce loan-type programs, such as seed
purchase, loan, sell, hold, and convey real _an?
money loans, construction loans, below-m~ketpersonal property") to prohibit ra~ial discnnninterest-rate loans, and purchase and leasmg of
.
land, the state would issue tax-exempt bon~s nation in the sale or rental of bousmg.
The Jones decision, however, is not a substi(guaranteed by the state where the state constItute for a comprehensive fair housing law . .It
tution permitted). Grant programs and other ~scovers only racial discrimination and not_ dissistance would be financed by state appropnacrimination on the grounds of religion or national
tions.
7
�origin. It does not deal with discrimination in the
provis,ion of services or facilities in connection
with the sale or rental of a dwelling. It does not
prohibit advertising or other representations that
indicate discriminatory preferences. lit does not
cover discrimination in financial arrangements
or in the provision of brokerage sources.
Nor does it provide for administrative assistance to aggrieved parties or enforcement. And
although courts can fashion effective remedies to
enforce the 1866 statute, ,the statute contains no
provision expressly authorizing a federal court
to issue injunctions or to order payment of damages.
The 1968 Civil Rights Act, on the other hand,
covers these specific acts of discrimination
omitted in the ·1866 s,tatute and fashions administrative and legal remedies as well. The remedies, however, are not strong enough to provide
adequate relief in many cases for those who suffer discrimination. The Secretary of HUD may
investigate complaints. His powers, however,
are limited to conference, concilia-tion and persuasion. He may not issue an enforceable administrative remedy.
For enforceable relief under federal law, the
aggrieved party must himself generally go to
court. (The Attorney General may bring suit
based on a pattern or practice of discrimination
or a denial of rights to a group of persons that
raises an issue of general public importance.)
The 1968 Civil Rights Act, however, invites
strong state action to gu arantee fair housing.
Section 81 0 ( c) provides that wherever a state
(or local) fair housing law provides rights and
remedies at least substantially equivalent to
rights and remedies in the 1968 Act, the federal
government will defer to the state in its enforcement activities.
Thus, in enacting a comprehensive state fair
housing law and in establishing a strong state
fair housing agency to secure the constitutional
rights of raci al and other minority groups, states
would be filling the gap in federa l legislation and
taking advantage of the priority extended to
state legislation by section 810 ( c ) of the 1968
Act.
A strong and comprehensive state fair housing law should :
-establish an enforcement agency with adequate staff and appropriations to enforce
the law;
-empower the enforcement agency to receive complaints fro m citizens, from appropriate state officials, and to initiate complaints on its own motion;
- ban all discrimination on the grounds of
8
race, religion, or national origin in the sale
or rental of all property, including:
-refusal to sell or rent,
-discrimination in the terms or conditions
of a sale or rental,
-use of advertisements or applications
which express or imply any such discr-imination,
-discrimination by real estate salesmen or
brokers, or
-discrimination by lending institutions;
-empower the enforcement agency to use
temporary injunctions on sale or rental during its investigation of a complaint;
-empower the enforcement agency to conciliate, issue cease and desist orders, require appropriate affirmative acts to cure
the discrimination ;
-provide penalties for a failure to comply
with the enforcement agency's orders;
-subject the enforcement agency's orders to
judicial review, and
-empower the enforcement agency to carry
on appropriate research and education programs to eliminate hous.ing discrimination.
ment, state and federal grants.
There is presently no regular source of funds
for the support of housing information centers.
States might make grants to help establish and
operate such centers.
Progran1 3
Priority Assistance to Developers Which Have
Affirmative Plans to Locate, Promote and Manage Their Low- and Moderate-Income Housing
Projects to Achieve Integrated Housing.
Racial integration of housing projects or neighborhoods rarely occurs without deliberate measures by developers.
Low- and moderate-income housing must be
located in areas where housing for these families
does not exist in great numbers.
The housing must be affirmatively marketed
with minority communities not accustomed to
considering housing so located.
Rental projects, if they are to become and remain integrated, must be managed with ,this objective always in mind.
A state can encourage developers to locate,
market and manage projects with the objective
of achieving integration by giving priority on its
state assistance (Programs one through eight)
to developers with affirmative and practical integration plans.
Program 2
Financial A ssistance to Nonprofit Metropolitan
Area Housing Information Centers to Aid Families in Finding Decent Housing.
In most communities the existing supply of decent housing for low- and moderate-income
families is not limited to the central city ghetto
or to its gray areas. It is often found in other
p arts of the metropolitan area as well. The lack
o f information on available rental and sale housing throughout the metropolitan area, however,
is a substantial barrier to the movement of families out of declining neighborhoods of the central city. F amilies in the housing market need
help in finding housing they can afford, convenient to their jobs, and located in good school
districts.
A nonprofit metropolitan area housing information center would list available housing,
i nteres t low- and moderate-income families in
moving to areas with which they are initially unfa miliar, escort them on inspection of houses,
ed ucate the community to the need for providing
more housing fo r low- and moderate-income
families and undertake other associated activities.
The Metropolitan Denver F air Housing Center, Inc. is the principal example of a housing
information center providing these kinds of
services. It is supported by private, local govern-
\
,I
9
�Ill. Improving Building Codes
P rogram
IV. Improving Relocation Assistance
A Model Building Code Embodying Pe,jormance Standards for Permissive Adoption by
Communities; A Building Codes Appeal Board;
A ids for Building Inspection.
Program
In most states, communities enforce differing
and generally outdated building codes. This profusion of outdated codes has tended to raise
building costs by perpetuating the outmoded and
uneconomic use of building materials and building techniques and by restrieting the natural play
of economies of scale in the construction industry. Higher building costs, in turn, unnecessarily
restrict the availability of decent housing for
low- and moderate-income families.
States might assist communities to improve
their building codes and building codes enforcement. Specifically they might:
- authorize the development of a state model
building code utilizing to the greatest extent possible performance standards for
permissive adoption by communities. (To
maintain uniformity the state should specify that the code would be automatically
amended when state amendments were
adopted, and that communities might only
alter the model code upon specific approval
of the administering agency) ;
- establish an appeals board to hear appeals
from decisions on the administration by
communities of the state model code or
other codes adopted by communities;
- require that state and local government
agencies utilize the state model code for
public construction;
- require that the state model code be used
for federal or state-assisted nonpublic construction ;
-establish professional qualifications for
building inspectors, train and license them;
- establish minimum staffing requirements
for community building inspection departments;
--offer building inspection services to communities which do not wish to maintain
their own building inspection departments .
10
A Uniform R elocation Program to Assist Communities to Pay R elocation Expenses and to
Provide R elocation Services to Families and
Businesses Displaced by State or Local Government Action.
Communities cannot be rebuilt for public objectives without uprooting families and businesses.
The public has the obligation to compensate
these dislocated families and businesses for the
costs of dislocation, and to see that they are relocated in suitable accommodations.
Unfortunately, famil ies displaced by public
action are often those with the least freedom in
the housing market- the poor, minorities, large
families and elderly. Special government efforts
therefore must be made to relocate these families successfully.
States might establish a uniform relocation
program for families and businesses displaced
by state and local government programs. It
would give financial assistance to communities
in making relocation payments and providing
relocation services where federal assistance is
unavailable.
To reduce inequities in the treatment between
families displaced by federally assisted activities
and families displaced by state or local activities,
to the extent possible there should be uniformity in the relocation assistance offered to fa milies or businesses displaced by any public action- federal, state or local.
Federal urban renewal relocation assistance
includes :
- relocation payments to families and individuals which may not exceed $200 for
moving costs and property loss;
-relocation adjustment payments totaling up
to $1000 over a two-year period to fa milies and elderly individuals to assist them
to relocate in standard accommodations;
-an additional payment to owner-occupants
of residential property acquired for an urban renewal project ( in lieu of a relocation
adjustment payment) to enable them to
purchase a replacement dwelling within
one year. (This payment would be that
amount not in excess of $5,000, which,
'
when added
to the acquisition price paid
for the owner-occupant's borne, equals the
average price for an adequate replacement
home in the community, and
- relocation payments for moving expenses
and re.imbursement to business concerns or
nonprofit organizations for property loss,
up to $3,000, incurred in their move. (If no
property loss is claimed, reimbursement
for moving expenses can be made up to a
maximum of $25 ,000.)
Such payments are covered in full by a
federal relocation grant made to the appropriate local agency. If the moving expenses
of a business concern exceed $25,000, the
locality may elect to reimburse the excess
costs through a local cash payment which
will be shared by the federal government
through a relocation grant in the same percentage as other urban renewal project
costs.
State-assisted relocation agencies should be
required to:
-establish a single central relocation agency
to offer services to all families needing relocation in a metropolitan area ;
- formulate a single reloc-ation plan covering
all foreseeable relocations by all government programs;
- see that displaced families are relocated in
. standard housing that is decent, safe and
sanitary ;
- relocate families to the greatest possible extent practicable outside of declining areas
of the community;
-provide for temporary relocation of displaced fa milies in decent housing where
permanent housing is not immediately
available;
-pay the expenses of moving the displaced
family or business and fix payments to
cover other expenses, and
- provide social services to relocated families
with such needs.
11
�V. Equalizing Landlord-Tenant Relations
The law governing the relationships between
landlord and tenant in the Anglo-American system has not changed substantially since feudal
times. Historically the law viewed a lease, not as
a contract recording mutual obligations, but as a
conveyance of an interest in land subject to conditions. Consequently, the law as formulated by
the courts does not adequately, with some recent
notable exceptions, reflect the new aspiratiions
and economic realities of an urbanized society.
An updating of these archaic laws" not only will
tend to reduce tensions in our cities by responding to the just claims of tenants, but may instill
greater respect for law -in general and provide
greater incentives for the maintenance of property by ,those who occupy and own it. At the
same time, responding to the valid claims of
tenants while ignoring the legitimate interests of
those who own and finance housing would not
be productive.
Landlord-tenant relations have attracted legislative attention recently in Illinois and Michigan. The Illinois Legislative Commission on
Low-Income Housing, in a 1967 report entitled
"For Better Housing in Illinois,"examined many
of the inadequacies in the laws governing landlord-tenant relationships and the enforcement of
housing codes in that state. Revisions of these
laws were recommended in ways which may be
applicable to other states.
Five laws that significantly equalize the rights
of tenants have recently been enacted in Michigan. These laws and similar provisions in other
states are the basis for the following guidelines.
Program 1
Permit a Tenant to Institute a Housing Code Enforcement Proceeding, to Obtain Specific R elief
for Inadequately Maintained Premises, and to
Withhold R ent to Secure Code Compliance.
Anti-trust laws, securities laws and other modern regulatory measures have commonly provided for private as well as public enforcement.
By contrast, although the tenant is a critically
interested party, the enforcement of housing
codes has been heretofore generally a two-party
affair between the public enforcement agency
and the landlord. Tenants have not been allowed
to initiate or control enforcement proceedings.
Yet their critical concern is justified in view of
the fact that in many instances the proceedings
can lead to the abandonment of the building, the
eviction of the tenants, or a major increase in
rent; and the failure to take action would result
in the continuance of substandard and often intolerable conditions.
12
The Michigan law makes housing code enforcement a civil rather tha'Il a criminal matter,
allowing a tenant to begin court action. The law
also creates a variety of court actions that may
be taken against landlords, including injunctions
or orders permitting the tenant, a receiver or the
city to make necessary repairs. The repairs can
be paid for out of rents withheld in an escrow
fund or by a lien on the property when the landlord is at fault, or by an assessment against the
tenant when he is at fault. In Connecticut, state
law authorizes municipalities ,to create repair
receivershipt with the state advancing the cost
of the repairs until rent receipts replenish the
fund.
These rent receivership or rent withholding
measures are also a housing code enforcement
technique. The state of New York, because of
its dense patterns of urbanization, as long ago as
1930 allowed New York City residents to pay
rent into court rather than to the landlord when
a certified code violation exists. The court retains
the rent, and evictions are stayed, until ,t he violation is corrected. To stimulate prompt remedial
action by the landlord, the law was amended in
1965 to permit the tenant to arrange for heat,
electricity, janitorial service or make repairs and
apply to the court to have bills paid out of the
rent on deposit.
Another method of rent withholding, applicable to New York City tenants, permits onethird of the tenants in an apartment to bring
action against landlords when conditions in the
building are dangerous to "life, health or safety. "
The court may appoint an administrator to collect rents and use them to remedy defects.
Rhode Island, Pennsylvania (limited to Pittsburgh, Philadelphia and Scranton) , M assachusetts and M aryland (limited to Baltimore) have
recently enacted similar measures. In a rela,ted
problem area, some states (Illinois, New York
and Michigan among them) have enacted legislation suspending the legal duty of a welfare recipient to pay, and the right of a landlord t? collect rent for housing in violation of applicable
housing codes.
Program 2
begin eviction proceedings without giving any
reason. A few courts, however, have begun to
rule that retaliatory evictions violate the tenant's
constitutional right to petition for redress of
grievances.
The Michigan law enables a tenant to resist an
eviction by contending that it is in retaliation for
exercising lawful rights, such as complaining to
public code enforcement authorities. In addition,
the new law reverses the general common law
rule that the breach by the landlord even of an
explicit promise to make repairs does not excuse
the tenant from payment of rent. Thus the tenant
may withhold his rent until the landlord makes
the repairs he has promised.
Program 3
R equire that Every Lease Pledge that Premises
Are Fit to Live in When the Tenant Moves in
and that the Landlord Will Keep Them in Good
R epair.
The common law provides a tenant with little
assurance that his dwelling will be comfortable
or even habitable. No duty to repair is imposed
on the landlord and he is under no duty, in the
absence of express agreement to the contrary, to
maintain or repair the premises. This rule is so
firmly entrenched it is widely felt that specific
legislation is required to override it.
In o rder to correct some of the injustices of
the basic rule, courts long ago adopted the fiction
of a constructive eviction-which permitted the
tenant to move out without payment of further
rent if he lost the beneficial use and enjoyment
of the premises through lack of beat -or light or
some similar gross defect. The right to leave,
however, is an empty one for the slum dweller.
The Michigan statute, accordingly, specifically places upon the landlord the duty of repair
during the term of the lease, and the duty to comply with applicable health and safety laws, except when the disrepair or violation has been
caused by the tenant. Presumably, the courts will
construe this to give the tenant the right to sue
for damages, consisting of the difference in the
rental value of the premises as they are and their
value if in the condition warranted by the landlord.
Prohibit "R etaliatory Evictions."
The term "retaliatory eviction" refers to an eviction undertaken in retaliation for the tenant's
complaint to municipal authorities of violations
of housing and health regulations: W~ere landlords have resorted to this practice it has not
been challenged. This may result from the law
prevailing in most states, where a landlord may
Program 4
R equire Local Housing Authorities to Give
R easons for Evicting T enants and Establish. a
"Board of Tenants Affairs" for Public Housing.
Local housing authorities are instruments for
local, state and federal housing policies. Such
13
�authorities are created by the state, subsidized
by the federal government, and their members
are appointed by the cities. Unlike the private
landlord, the local housing authority is not motivated by profit.
The admission and eviction of tenants is the
source of most controversy in public housing
practices. Because of the silence of most state
enabling statutes and the special concern of the
federal government with financial aspects of subsidized housing authority operations, the local
authority typically sets its own admission and
eviction policies. These standards may not be
published, or if published may not be clear; they
often relate to the "social desirability" of prospective or existing tenants as determined by the
management.
Nevertheless, tenants seeking to resist their
eviction from public housing projects have
found the courts frequently an alogizing public
landlords with private landlords, or using other
rationales to avoid reviewing the merits of such
cases. Although there have been exceptions to
this rule, the results of most cases leave local
housing authorities with power legally to evict,
or refuse admission to anyone, without cause.
Corrective regulations aimed at " upgrading . . .
outmoded management policies" addressed to
procedural problems have been issued by HUD.
Section 3.5 of the HUD Low-Rent Management
Manual ("Procedures Prescribed for the Operation of Federally Aided Low-Rent H ousing" )
requires a local authority to adopt and publicize
its admission policies, but does not prescribe
policies beyond those imposed by law relative to
income, age, disability, race, etc. Section 3.9
prohibits evictions witho ut giving the tenant
notice of reasons and affording him "an opportunity to make such reply or explanation as he
may wish." Although these rules are intended as
mandatory by federal officials, it is not clear that
local authorities view them in the same light.
In the absence of an adequate supply of decent low-income housing, the refusal to confer,
or the withdrawal of the benefits, of a dwelling
in public housing constitutes substantial injury
to a potential or existing tenant. It is within the
pu rview of the state to prescribe the manner in
which housing authorities deal with applicants
and tenants. The ingredients of a policy reflecting commonly accepted standards of fairness
might be:
- applicants for admission to public housing
should be apprised with in a specified period of
a determination of ineligibility and given a right
to appeal to a body other than the management;
- the reasons for an unfavorable decision
14
should be clearly and concisely stated in relation
to precise standards of admission;
- leases should be written in simple language and effective on a self-renewing basis
terminable (for a cause other than exceeding
income limitations or nonpayment of rent) only
for conduct injurious to other tenants or substantially injurious to the project;
- evictions should be permitted only for
good cause with the opportunity for a fair hearing; and
- rights of privacy of tenants should be respected and harassment in the form . of fines ,
charges for repairs, threats of eviction, etc. , prohibited.
The Michigan law adopts many of these principles.
Another essential ingredient of a soundly administered public housing program is an increased effort to involve tenants in the management of projects. This may be done through the
creation of representative tenant organizations
or the representation of tenants on the local
housing authority board.
The Michigan law creates for public housing
in the City of Detroit a " board of tenants affairs ," one-half of which is composed of elected
tenant members and one-half by appointees of
the mayor. The board may veto rules and regulations of the authority and acts as a binding
board of review on decisions of project management or the authority with respect to matters
such as denial of admission to or eviction from
public housing and rent increases.
A similar Rhode Island measure creates a
board of tena~ts affairs for each city in the state
with a public housing project. One-half the
board is elected from among tenants occupying
housing proj ects, the others to be appointed by
th e mayor from residents of neighborhoods in
which the projects are located. Thi s board advises the housing authority on tenant welfare,
may veto authority rules on admission, occupa ncy, and eviction policies, and sits as a board
of review for individual compl aints on these
matters.
VI. Enhancing Community Development
Housing without stable neighborhoods served_by
adequate community facilities will not provide
long-term values to our cities and their people.
States can take important steps to enhance the
environment which supports new and rehabilitated housing. Just as an expanded supply of
well-designed housing requires the stimulation
of private initiative and assistance to local units
of government, balanced community d~velopment cannot take place without a contmuous
partnership between government on all levels
and private groups.
Program 1
Pro vide a Substantial Portion of the R equired
Non-Federal Share of Federally A ided Community Development Programs and a Substa~tial
Portion of the Cost of Non-Federally Assisted
Projects.
The federal programs to aid local comm~nity development require contributions to project cost
from non-federal sources. These are often in the
form of cash but usually in the form of non-cash
items ·such as staff services, parks, schools or
other facilities related to the project.
Increasingly, the ability of many localities t_o
utilize these programs is dependent upon their
ability to finance the non-federal share of a
.
project.
Connecticut has recently implemented comprehensive community development legislation
which, among other programs, extends state financial assistance to localities in the form of
contributions to the non-federal sh are of _fe~erally assisted projects. In some instances this kmd
of help has spelled the difference between federal
funding and no local program at all.
Connecticut, for example, fund s one-half of
the local share of fed erally assisted urban renewal projects, demolition of unsafe or uninhabitable buildings, construction of neighborhood facilities, and open-space land acquisition.
The state contribution to the non-federal share
of urban renewal projects actually began in 1955
and has contributed materially to the flow of
federal urban renewal fu nds to cities in that state
ever since. A Connecticut city need supply only
one-sixth instead of one-third of net project cost.
As a result, one dollar of city funds (supplemented by one state dollar) generates four federal dollars instead of only two. The form of state
assistance was inaugurated in Pennsylvania as
early as 1949, the year the federally assisted urban renewal program was enacted.
Neighborhood facilities, in particular, embrace a wide range of horizon-expanding centers
15
�for persons of low- and moderate-income. These
centers house health, recreational, social service,
civic, educational, cultural and youth activities
that can give residents a sense of identity, community pride and participation. In Connecticut,
the state pays half the non-federal share of the
cost of building these modern-day settlement
houses, and there have been proposals to extend
state aid to non-federally aided neighborhood
facilities.
In Connecticut, a special state program also
assists the development of child day-care centers
for disadvantaged children by funding two-thirds
of the operating cost to the locality ( or an antipoverty agency) . The state normally relies on the
application approval by the federal authorities
in allocating its own contribution to the locality,
thus avoiding unnecessary paperwork by municipal officials.
In New Jersey, the state, in addition to providing one-half of the local share, allows a flexible formul a (up to 100 percent) for contributions to the local cost of federally assisted urban
renewal projects to the extent they are devoted
to public uses.
As a prerequisite to aid for community development programs, Connecticut requires localities to prepare a Community Development Action Plan (CDAP). The CDAP is a community's
survey and estimate of its problems and the physical, economic and human resources for dealing
with them. T he state provides three-fourths of
the cost of preparing the CDAP ; some of these
costs to the state, with respect to CDAPs for
communities under 50,000 are in ,t urn funded by
HUD. It is vital, however, for a state to assure
that these planning requirements do not become a
substitute for or an inhibitor of program actions.
The Connecticut Community Development
Act, moreover, permits state aid to many projects that do not receive federal funding. In such
cases the state provides two-thirds of the cost of
the project. A state which participates in the
funding of federally assisted projects should retain this flexibility. Some deserving applications
will not receive federal funding fo r a variety of
reasons. The state may wish ,to help localities
that have sought federal fund ing but have not
been able to obtain it for reasons unconnected
with the merits of the project.
Pennsylvania, for example, has launched an
ambitious open-space land acquisition program
financed by proceeds of a $500,000,000 bond
issue. This pays for one-half of project cost to
the locality.
Although Connecticut only makes grants for
specific programs set forth in its statute, states
16
might consider making a portion of their grant
money available in block grants to cities for programs which do not fall within established categories of federal or state assistance. This will
encourage ·1ocal initiative and will help meet individual locality needs.
Program 2
An Urban Development Corporation with StateWide Authority to Combine State and Private
R esources for the Improvement of Meiropolitan
Areas.
There are many factors inhibiting private, profitmotivated entrepreneurial participation in city
renewal efforts on the scale demanded by current
needs. Profit-motivat¼d entrepreneurs are used
to assuming normal business risks. They are less
accustomed to the political and public relations
risks associated with publicly assisted programs.
And they are disinclined to shoulder the additional commitment of personal and fin ancial resources occasioned by protracted negotiation
and processing which often lengthens the development period.
One way to bridge the gap between public
control over land use and private entrepreneurial initiative has been indicated in New York.
The state has recently created the New York
State Urban Development Corporation (SUDS) .
SUDS is empowered to draw upon the combined
talents and resources of the state and private
business to work with local governments to produce development and redevelopment projects
throughout the state. These projects are intended to include balanced combinations of
housing, light industri al, commerci al, recreational and cultural developments. As requested
by agencies of the state or by cities, the corporation is to consider implementing projects within
ex isting state and city programs.
The corporation board of an urban development corporation similar to SUDS could be onehalf comprised of public officials and one-half
chosen from the private sector. Initially, the corporation could be funded by the state through
the issuance of tax-exempt revenue bonds. Conceivably, the corporation would eventu ally genera te sufficient earnings to cover operating expenses with o nly investment capital furni shed by
the state in the form of loans at a rnte approximating that of the state's cost of borrowing.
The corporation would plan projects and assemble the land, through eminent domain if
necessary. In New York, SUDS has ultimate authority to override local building and zoning
regulations. Although SUDS has extensive statu-
tory authority in these respects, it is likely that it
will oper-ate most effectively and perhaps exclusively in communities where local governmental
and planning bodies are cooperating with the
corporation.
Rather than tie up its capital in the actu al development of a project, the corporation could
encourage private developers to undertake this
work.
The corporation could also act as a developer
itself where necessary. In such instances, after
the project was completed, with long-term financing in effect and the project fully rented or
functioning according to plan, the corporation
would undertake to sell the project to a private
investor or investors. The proceeds of the sale
would be applied to the retirement of state loans
to the corporation. Pursuant to conditions to be
defined, some portion of the proceeds could be
retained by the corporation. In some instances,
the corporation might find it necessary to take
back a lease in order to relieve the investor of the
operating or supervisory burdens of ownership.
Conceivably the corporation might eventu ally
cause various real estate investment trusts to be
organized. Projects would be sold to the trust
with a lease-back by the corporation. If feas ible,
this could be a method of mobilizing and channeling substanti al amounts of priva te capital into
investments to which it would ordin arily not be
attracted. Direct investment in real estate and
development requires experience, sophistication,
and fixed amounts of equity money, with the ·a dditional diffic ulty, especially in the case of residential real ~state, of responsibilities to tenants,
legal, public relations and political hazards.
However, purchasers of the real estate investment trust certificates could enj oy the benefits of
real estate ownership and be substantially free
of its hazards.
Progra1n 3
Loan Guarantees to Owners of R esidential Property and Small Businesses.
Private initiatives are necessary to reh abilitate
the economic life and physical fac il ities of
blighted communities. But often th ese are not
forthcom ing unless th e addition al risk of inve tment in deteriorated areas is reduced.
When needed capital, or bonding capacity, is
not otherwise a~a ilable, states might provide an
urban development guarantee fund to guarantee
loans made by conventional lenders to owners of
resi dential property and small businesses.
A loan to an owner of residential property
would have to be intended to provide housing
for persons and families who could not obtain
safe and sanitary accommodations provided by
the unaided operations of private enterprise. A
business would qualify for a guaranteed loan if
it were unable to obtain adequate financing to
maintain a stabilized work force or increase job
opportunities by virtue of (a) its location ; (b )
its net assets ; or ( c) its doll ar volume.
The New York Urban Development Guarantee Fund loans are to be used for the purposes of
construction rehabilitation, or refinancing of
properties a~d, in the case of small business pr_ojects, for equipment, stock in trade or wor~mg
capital. The monies of the fund are den ved
through the sale of debentures and from gifts.
The fund is empowered to invest funds held by
it and to charge a premium for its guarantees. In
the event of default, the fund would pay to the
lender the net amount of the loss.
Program 4
Technical and Financial Assistance to Communities to Draft Proposals for Federal Program
Grants.
The increasing complexity of application requirements fo r some federal yrograms, eve~
those whose ultimate objective 1s frankly expen1:1-ental, has outrun the staff resources of many
small er communities.
The federal "Model Cities" progra m, for example, is intended to demonst rate how th~ ~nvironment and general welfa re of people hvmg
in slu m and blighted neigh borhoods ca n be substanti ally improved through the orchestrati~n of
federal, state and local governmental and pnvate
efforts. Cities must submit proposals fo r planni ng grants. T hese proposals are to analyze the
social, economic and physical problem~ of the
model neighborhood area, what the city proposes to do about t~em, ~n? the strategy and
adm inistrative machmery 1t mtends to employ.
Under the program, cities with approved
planning grants will become eligible fo r s~e~ial
grants supplementing assistance under_ ex1stmg
federal 1rrant-in-aid programs. T he reqwred nonfederal 0 contribution to every federally as isted
project or activity carried ou t as part of an approved model cities program serves as the " base"
fo r computing the special supplemental grant.
The special grant may be up to 80 percent of
the total non-federal contri bution.
The development of a model cities or urban
renewal proposal places a demand on the financial and techn ical capabilities of many localities.
To help them obtain the e grants, the state
might:
17
�--l
I
( a) assist in drafting proposals for federal
grants for communities which request
technical assistance, and
(b) make grants to enable those communities which wish to draft their own proposals to hire competent staff and consultants for this purpose.
The stategic injection of assistance in this
manner can help to enhance the flow of federal
dollars to communities within the state. The purpose of this kind of assistance, however, should
be the development of local competence to handle these administrative tasks in the future. It
can be applied to a variety of federal grant-inaid programs.
The New Jersey Department of Community
Affairs has been particularly active in helping
communities with Model Cities applications to
HUD. Pennsylvania, through its Department of
Community Affairs, provides similar help with
applications for federal assistance for a broad
range of programs.
HUD is authorized to make grants to states
to provide technical assistance to communities
under 100,000 in population. A state program
as described here, organized as a special technical assistance effort, might be eligible to receive a 50 percent grant from HUD to cover its
cos ts.
Program 5
Eliminate Constitutional Prohibitions, if Any, on
the Involvement of Private Enterprise in Urban
Affairs.
A concerted attack on the problems of urban
housing and community development requires a
public-private partnership. New legal and financial tools and interrelationships must be devised
to permit states, local units of government and
private groups to marshal their resources in ways
not foreseen years ago. Some state constitutions,
however, specifically prohibit the use of the
state's credit for private undertakings or contain
provisions which have been interpreted as precluding tax abatement and other desirable public-private cooperative arrangements.
The Advisory Commission on Intergovernmental R elations, a permanent, bi-partisan body
esta blished by Congress to study relationships
among local, state and national levels of government, has recommended the following constitutional language to facilitate general cooperative efforts between state and local public agencies and private enterprise :
Notwithstanding any other provision of
this constitution, the state, its political sub18
divisions, and any public corporation may, as
provided by law, where a public purpose will
be served, grant or lend its funds to any individual, association, or private corporation
for purposes of participating or assisting in
economic and community development.
These basic constitutional changes are important. It is nonetheless vital to recognize, for example, that a program of state aid to localities
for urban renewal under existing constitutional
provisions can go far ,to bring about a constructive public-private partnership.
Program 6
A Commission to Review and Assess Uodern
Techniques of Zoning and Land Use Regulation
and to Recommend Legislation to Modernize
the State's Zoning Enabling Act.
The period of rapid urbanization since the war
has proven the inadequacy of present zoning
statutes to control urban sprawl.
The American Law Institute is presently drafting a Model Land Development Code to overhaul antiquated state zoning enabling statutes
and provide much needed new tools to communities for shaping urban development.
States should authorize the establishment of a
commission to review and assess modern techniques of zoning and land use regulation and to
recommend legislation for modernizing the
state's zoning enabling act. A legislative committee of this nature is now at work in Connecticut
having the benefit of a report on th at state's plan~
ning legislation . It is drafting specific measures
that may have applicability in other jurisdictions.
The prime objective of such a review would be
to introduce greater flexibility into typically rigid
requirements which inhibit imaginative and progressive land use for community development,
and to eliminate the use of zoning powers to undergird economic segregation in residential development.
Program 7
Excellence in the Design of Structures In volving
the Use of State Funds or Credit and the Preservation of Public Building,r and Areas of Historical or Architectural Significance.
Stimulation of massive increases in needed housing and community facilities will not achieve durable improvements in urban life unless conscious
and unremitting attention is paid to the quality
of the structures and public spaces and their sensitivity to the needs of people.
Design quality is not a matter of style or pa-
tina or the application of cosmetic effects. It goes,
rather, to the heart of the process by which space
is shaped. Delay, inadequate fee arrangements,
resistance to innovation, imprudent concern with
short-run savings at the expense of long-run viability-any of these will drive superior talent
away from design responsibilities in subsidized
projects. Great architecture, it has wisely been
said, requires great clients. The state, in its manifold direct and indirect role as a potentially
"great client," should impress all those who deal
with it or serve it as functionaries with ,t he understanding that excellence in the end product is a
keystone of .the state's housing and community
development policies.
The creation of a State Council on Architecture is one means of implementing these objectives. Such a Council has been created in New
York to:
-encourage excellence in design of all buildings constructed by the state or under supervision or with assistance of any state
agency;
-stimulate interest in architectural excellence
in public and private construction throughout the state;
-accept gifts to further its objectives;
-obtain from other agencies of the state necessary cooperation and assistance;
-make grants to municipalities to rehabilitate structures of historical or architectural
significance for public purposes.
Whether a council or some other instrument
is created is secondary to assuring that what is
designed, who is involved in the process, and
how the process works is sensitive to user needs
and community values as well as the normal economic structures. Even in purely economic
terms , costs of managing, maintaining ( and protecting) a structure may be sharply reduced by
appropriate design in the first instance. The responsibility for analyzing and changing the manner in which public funds are employed in designing community facilities from capital budgeting to maintaining the end result-must be
centralized and highlighted.
VII. Developing New Communities
Program
New Community Development Corporations
with Eminent Domain Powers; Deferral of Property Taxes during Development Period; State
Approval of New Community Development
Plans in Lieu of Other Land Use R egulation.
States can participate directly in solving urban
problems by encouraging the development of
new comunities on raw land outside of existing
urban concentrations.
New communities offer opportunities both
for alleviating the problem of overcrowding in
the central city and for overcoming the ugly
patchwork sprawl on urban fringes .
By providing a wide range of housing at varying prices, including low-income housing, new
communities give promise of economically and
socially integrated cities.
Through comprehensive planning, new comi;nunities can provide for orderly urban growth
using the most desirable locations, timing their
development to correspond with area-wide or
regional development plans or objectives.
Internally, new communities can use land
more efficiently, thereby cutting costs and providing better public services. They can br~ak
away from conventional thinking, devel?p~ng
new arrangements in such fields as bu~dmg
codes, land use controls, zoning regulations,
public services and governmental structures: .
New communities offer unique opportumttes
to enlist the talents and energies of the private
sector in the inevitable expansion in the nation's
metropolitan areas. They offer 'large-scale investment opportunities and new markets. Moreover, they offer a dramatic chall~~ge to ~e
private sector to demonstrate its a~1hty to ~mld
new urban environments in a settmg relatively
free of the many constraints which hamper private initiative in existing cities.
A first step in undertaking a state new community program could be to inventory land now
owned by the state which may be deemed surplus to its needs. It may be found , fo r example,
in many states that thousands of acres were purchased in the last century for penal or mental
19
�institutions and hospitals in then rural areas
which are no longer required in the light of mod~
em medical or penal practice. Such land could
be retained by the state, but leased to new community developmeat corporations.
To help fin ance approved new communities
Title X of the H ousing and Urban Developmen~
Act of 1965 provides FHA insurance of mortgages fin ancing land and improvements for new
communities. T itle IV of the Housing and Urban
D evelopment Act of 1968 provides a federal
guarantee of debt obligations of private new
community developers. These provisions should
ease the financing difficulties of new community
developers.
S~ates, however, can remove three other major
barners and thus stimulate the development of
new communities within their borders.
F irst, they might charter new community
development corporations which would be authorized to use the power of eminent domain to
assemble _large tracts of land necessary for the
construction of new communities.
S_econd, they might defer local property taxes
dunng the development period of the new communjty by temporarily reim bursing developers
for local property taxes paid, as an interest-free
loan to be repaid when the property is sold, but
not la~er than the end of a stated deferral period.
Third, they might provide for state approval
of new community development plans wpich
would supersede local land use regulation that
would otherwise apply to new com munity tracts.
In many areas where new communities would
be located, largely rural local government is
unable t~ respond effectively to the needs of new
commumty developers. Direct state action is
~eede~ to speed development or, indeed, to make
it ~oss1ble. State authority would then be relinq~1shed to the government of the new commumty, once it was established.
A state land should not be leased eminent
domain powers granted , the deferral of local
property .taxes made, nor state approval of new
commumty development plans given unless a
state finds that:
- the development of a new community will
make a substantial contribution to the
economic and social development of the
area in which it is situated ;
- the site ~elected fo r the new community is
sound with regard to projected population
trends, the availability of land required ,
the absence of undesirable topographical
or geological features, and the availability
of transportation;
- the proposed new community will have a
20
sound economic b ase and sound land-use
patterns;
-adequate provision has been made for local
self-government;
- adequate provision has been made for all
necessary public utilities and facilities including those n eeded for education, he;lth,
transportation, open sp ace, sites for industrial and residential uses, a central business
center, and cultural and recreational facilities, and
- adequate housing is available to meet the
needs of families of a wide variety of income levels, including a substantial number of families of low- and moderateincome levels.
VIII. Centralizing Administration of Housing
and Community Development Programs
Program
A Cabinet L evel Department of Housing and
Community Affairs R esponsible to the Governor, with R esponsibility for Administering a
Broad Range of Community A id Programs.
A state's ability to help communities tackle the
tough urban problems of poor housing and inadequ ate community facilities could be greatly
increased if responsibility for aid to urban communities were centralized in a single dep artment,
agency or individual. Yet, today only a score of
states have centralized a uthority for housing and
community affair s programs.
A centralized agency for community affairs ,
With adequate authority to administer a broad
range of community aid programs like those described above, should be able to:
- help communities attract private capital investment a nd business skills in ,solving
community p roblems;
- help communities attract and effectively
utilize greater amounts of federal assistance;
- help communities attract the financial assistance of private foundations ;
- fill the gaps among existing federallyassisted community programs;
- help local governments improve their planning and management of community programs, so that they can better assess
community needs and decide the kinds of
federal and st ate assistance that are required ;
- help communities develop new approaches
to commun ity problems through smallscale pilot programs which, if successful,
could be widely repeated;
-marshal state resources for more effective
assistance to communities;
- provide needed technical assistance to public and private groups, and
- be a clearinghouse fo r information on a ssistance available to communities and a
coordinator among communities, between
state and communities, and between the
federal government and communities.
The form a centralized state authority for
community affairs will take must fit into the administrative pattern of the state. At least three
variations of centralized authority have been
adopted :
- a department of housing and community
affairs with broad statutory authority ( e.g.,
Connecticut, New Jersey, Pennsylvania,
Rhode Island ) ;
- a housing and community affairs administrator with narrower statutory authority
(e.g., Alaska, Illinois, Vermont);
- a special assistant to the Governor for housing and community affairs without statutory authority (e.g., Kentucky, Kansas, and
North Carolina).
.
A department of housing and community affa irs responsible to the Governor and armed
with a full range of community assistance programs is, generally speaking, the best administrative arrangement. It dramatically demonstrates the state's commitment to assist its communities on a continuing basis; it allows the
Governor to assert executive leadership, and it
may make possible a marshalling of state resources in other programs toward solving community problems. A principal task of the department would be to see that state assistance
progra ms are more directly aimed at aiding communities to solve u rban problems.
At the same time, the department as its principal task must direct its energies to helping
communities to help themselves. This requires
an able staff familiar with both local needs and
the federal and state resources available to meet
them. It also requires sufficient funding to create
incentives to attract community support and
capable personnel convinced of their value to
the localities they are assisting.
A special program of federal matching grants
has been authorized to assist states in providing
special training for professional, sub-professional and technical persons to be employed in
housing and community development. Many
states have already filed plans spelling out specific proposals, but these await federal funding,
which is now anticipated. This program m ay
thus provide the key resource for departmental
staff development.
21
�References
New Jersey :
Other:
I.
Increasing the Supply of Low- and ModerateIncome Housing
Program 1: Seed money loans, technical assistance and
grants.
Connecticut:
Illinois:
Michigan:
New Jersey :
New York :
Other:
8 Connecticut General Statutes Annotated, secs. 218, 220 (P.A. 522,
laws of 1967, sec. 20-21 ) .
Chapter 67 1/2 Smith-Hurd Illinois
Annotated Statutes, secs. 308-309.
12 Michigan Statutes Annotated
secs. 16: 114 et seq.
'
52 New Jersey Statutes Annotated
secs. 27D-59 et seq. (P.L. 1967 c'.
82).
41 McKinney's Consolidated Laws
article 11.
'
Urban America, Inc., Proposed
Kentucky Housing D evelopment
Fund; Proposed W est Virginia
H ousing D evelopment Fund.
Contact:
James Twomey, Director
Nonprofit Housing Center
Ur ban America, Inc.
I7i7 M assachusetts Avenue,
N.W.
Washington, D.C. 20036
202/265-2224
Program 2: State-developed housing.
Alaska:
Alaska Statutes, secs. 18.55.010 et
seq.
Hawaii :
8 Revised Laws of Hawaii, 1955,
secs. 74-1 et seq.
Vermont:
Acts of 1961 , no. 21 2 ( as amended
by H.B. 447, laws of 1968) .
Program 3: Below-m arket-interest-rate mortgage loans.
Illinois:
67 I /2 Smith-Hu rd Illinois Annotated Statutes, secs. 310 et seq.
M assachusetts : 2A Massachusetts General Laws
Annotated, Chapter 23 A.
12 M ichigan Statutes Annotated,
Michigan :
secs. 16.114 et seq.
New Jersey:
55 N ew Jersey Statutes Annotated,
sec. 141-5 (P.L. 1957 c. 8 1); 52
New Jersey Statutes Annotated,
sec. 27D -66 (P.L. 1967 c. 82).
New York :
41 McKinney's Consolidated Laws,
article 2.
Program 4: Interest-free loans to developers.
New Jersey :
Senate Bill 859, introduced June 13,
1968.
Program 5: Construction loans.
Illinois:
67 1/2 Smith-Hurd Illinois Annotated Statutes, sec. 3 IO.
Massachusetts: 2A Massachusetts General Laws
Annotated, Chapter 23A.
RI
144 New Jersey Statutes Annotated,
sec. 141-5 (P.L. 1967 c. 81).
Urban America (see Program
above).
Program 6: Land acquisition and write-down.
Connecticut :
8 Connecticut General Statutes Annotated, sec. 214 (P.A. 522, laws of
1967, secs. 16, 17).
Program 7: Rehabilitation housing
write-down.
New Jersey:
acquisition and
Senate Bill 859, introduced June 13,
1968.
Program 8: Property tax abatement.
Connecticut:
Michigan:
New Jersey:
New York :
8 Conn~cticut General Statutes Annotated, secs. 215, 216 (P.A. 522,
Jaws of 1967, secs. 18-19) .
P.A. 1968, No. 334.
52 New Jersey Statutes Annotated,
sec. 27D-51 (P.L. 1967, c. 80).
41 McKinney's Consolidated Laws,
article 11, sec. 57 5.
Program 9: Administration.
Illinois :
67 1/ 2 Smith-Hurd Illinois A nnotated Statutes, secs. 308 et seq.
M assachusetts: 2A M assachusetts General Laws
Annotated, Chapter 23A.
Michigan:
12 Michigan Statutes Annotated
sec. 16.114 et seq.
'
New Jersey :
55 N ew Jersey Statutes Annotated
secs. 14J-1 et seq. (P.L. 1967:
C. 81 ) .
41 McKinney's Consolidated Laws
New York:
article 3.
'
II.
Increasing Housing Choice
Program ]: Comprehensive fa ir housing Jaw.
Alaska :
Alaska Statutes, secs. 18.80-010. 160.
Colorado:
69 Colorado Revised Statutes, article 7.
New York:
18 McKinney's Consolidated Laws
article 15.
'
Program 2: Metropolitan area housing information
centers.
New York:
Senate Bill 4099, Assembly Bill
6026.
Contact:
State Senator Whitney North Seymour, Jr.
State Capitol
Albany, New York
Other:
Paul D avidoff, Neil G old, Harry
Schwartz, A H ousing Program for
N ew Y ork State (1 968) .
Contact :
Paul D avidoff, Chairman
Urban Planning Program
Hunter College of the City U niversity of New York
N ew York, New York
Metro Denver F air Housing Center,
Inc.
Contact :
Richard E. Young, Chairman
130 West Twelfth Avenue
Denver, Colorado 80204
303 / 534-1263
Other :
Program 3: Priority assistance for integrated housing.
III.
Improving Building Codes
Program: Model building code.
18 McKinney's Consolidated L aws,
New York :
ar ticle 18.
Advisory Commission on IntergovOther:
ernmental Relations, 1968 State
L egislative Program , pp. 287 et seq.
IV.
Improving Relocation Assistance
Program: Uniform relocation program.
Connecticut :
8 Connecticut General Statutes Annotated, sec. 219 (P.A. 522, laws of
1967, sec. 24) .
Maryland :
33A Annotated Code of M aryland,
sec. 6A.
New Jersey:
52 N ew Jersey Statutes Annotated,
secs. 31B-1 et seq. (P.L. 1967 c. 79).
Other:
Advisory Commission on Intergovernmental Relations, 1968 State
Legislative Program, p. 264.
V.
Equalizing Landlord-Tenant Relations
Program I: Means to secure code compliance.
Connecticut:
Community Development Act.
Illinois:
"For Better Housing in Illin ois," Report of the Legislative Commission
on Low-Income H ousing ( April 10,
1967).
Maryla nd :
Code of Public Laws, Baltimore
City, 1949 ed., sec. 459A.
Massachusetts : M ass. Gen. Laws Anno., Ch. 111,
sec. 127H (1967) .
New York:
Real Property Actions and Proceedings Law, sec. 755 (McKinney
Supp. 1966).
Pennsylvania : Pa. Stat. Anno. Lit., 35 sec. 1700-1
(Supp. 1967 ) .
Rhode Island: R. I. G en. Laws Anno., 45-24.2-11
(1956) .
( Rent withholding by welfa re agencies ) :
Illinois:
Ill. Rev. Stat., Ch. 23, secs. 11-23
( 1967 ) .
Michigan :
M ich. Stat. Anno., sec. 16.414 (3)
(Supp. 1968 ).
New York:
N.Y. Social Services Law, sec. 143-b
(McKi nney 1966) .
Program 2: Evictions.
Michigan :
Laws of 1968, P.A. 297.
Program 3: Private obligation to repair.
M ichigan :
Laws of 1968, P.A. 295.
Program 4: Publ ic housing policies.
M ichigan:
Laws of 1968, P.A. 267, 344.
Rhode Island: R.I. Gen. Laws Anno., 45-25-18
(House BiJI No. 1605, Laws of
1968).
VI.
The American Bar F oundation, under contract to the U.S. Office of
Economic Opportunity, is preparing a "Model Landlord-Tenant
Code." The final report, expected
to be available by January 1969,"
will consist of a statutory text together with relevant notes and comments. Its purposes include the codification of existing Landlord-Tenant Law, as well as the suggesting
of useful changes. The Code is designed for eventual submission to
the various state legislatures after
initial submission to the National
Conference of Commissioners on
Uniform State Laws.
Contact:
Philip Hablutzel
American Bar Foundation
1155 East 60th Street
Chicago, Illinois 60637
Enhancing Community Development
Program J: Financial assistance for community development programs.
Community Development Act, P.A.
Connecticut:
522, Laws of 1967.
N ew Jersey:
State Aid for Urban Renewal Projects, Laws of 1967, c. 80 (NJSA
52:27D-44 et seq. ).
Program 2: Urban development corporation.
New York :
Chap. 174, Laws of 1968.
Program 3: Loan guarantees.
New York:
Chap. 175, Laws of 1968.
Program 4: Assistance to obtain federal grants.
Laws of 1967, c.82 (NJSA 52:27DN ew Jersey:
59 et seq. ).
Program 5: Constitutional reform .
Advisory Commission on lnter~ovOther :
ernmental Relations, State L eg1s/atio11 Program for 1969.
Program 6: Zoning and plan ning reforms.
Connecticut :
New Directions in Planning Legislation, American Society of Planning Officials.
1313 East 60th Street
Chicago, Illinois 60603
American Law Institute, Model
Other:
L and D evelopment Code.
Contact:
Allison D unham , C hief Reporter
101 N . 33rd Street
Philadelphia, Pennsylvania 19104
Program 7: Improving design quality.
Chap. 982, Art. 22, Laws of N.Y.
New York :
Contact:
John P. Jansson, Executive
Director
New York State Council on
Architecture
545 Madison Avenue
New York, New York 10022
R2
�VII.
Developing New Communities
Program: Aiding the development of new communfries.
New York :
Laws of 1968, Chapters 173, 174.
Other:
Advisory Commission on Intergovernmental Rel ations, 1969 State
Legislative Program, pp. 507 et seq.
VIII.
Centralizing Administration of Housing and
Community Development Programs
Program: A centralized department of housing and
community affairs.
Connecticut :
8 Connecticut General Statutes Annotated, secs. 201 et seq. (P.A. 522,
Laws of 1967.
New Jersey :
52 New Jersey Statutes Annotated,
secs. 27D-1 et seq. (P.L. 1967,
c.293).
Pennsylvania : Reorganization Plan 2, Act 582,
1965, Reg. Sess.
Further information concerning the operation of the
state programs referred to can be obtained from the
follow ing officials :
A laska
Larry Montgomery, Director
Local Affairs Agency
Pouch AB
Office of the Governor
Juneau, Alaska 9980 l
907 /586-5 386
Connecticut
LeRoy Jones
Commissioner of Commun ity Affa irs
1179 Main Street
P.O. Box 786
Hartford, Connecticut 06120
Ha waii
Yoshio Yanagawa
Executi ve D irector
Hawaii Housing Authority
1002 North School Street
Honolul u, Hawaii
/1 /in ois
Richard Blakley
Managing D irector and Secretary
Illinois State Housing Board
160 LaSalle Street
Chicago, Illinois 60601
3 12/ 346-2000
Kansas
John I va n
Special Ass istant for Urban Land
Community Affairs
The Governor's Office
State Capitol Building
Topeka, Ka nsas 6661 2
913/ CE5-00l I , Ext. 261
K entucky
John Vanderweir
Director of Division of Land Development
Assistance
Kentucky Program Development
Office of the Governor
Frankfort, Kentucky
502/564-3840
Massachusetts
Julian D. Steele
Commissioner
Department of Community Affairs
State Office Building
JOO Cambridge Street
Boston, Massachusetts 02202
617 /727-3238 ..
Michigan
Robert McLain, Director
State Housing Development Agency
Department of Social Services
Lewis Cass Building
Lansing, Michigan
5)7/ 373-2000
N ew Y ork
Edward Logue
President and Chief Executive Officer
New York State Urban Development Corporation
22 W. 55th Street
New York, New York 10019
212/ JU 2-7030
N ew Jersey
Paul Ylvisaker, Commissioner
Department of Community Affairs
State of New Jersey
363 W. State Street
Trenton, New Jersey 08625
609 I 292-6420
North Carolina
Luther C . Hodges
Housing and Urban Affairs Land Specialist
State Planning T as k Force
405 State Adminjstration Building
P.O. Box 1351
R aleigh, North Carolin a 27602
919/829-4131
Pennsylvania
Joseph W. Barr, Jr.
Secretary of Communit y Affairs
State of Pennsylvania
201 South Office Building
Harrisburg, Pennsylvania 171 20
717/78 7-7160
Rhode Island
Rev. Arthu r L. H ar dge
Director
Department of Community Affairs
State House
Providence, Rhode Island
401 / 52 1-7100
Ve rm ont
J ames F in neran
Executive Director
State Housing Authority
Mo ntpelier, Vermont
802 / 223-23 I l
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