Mr. FORD. I have gotten these together from our own hearings. These are in the hearings.

Here are some housing facilities out on the Columbia River: dwelling type, five-room apartment, three bedrooms, frame, four in a unit; built in 1949 at a cost of $15,990; present value of $12,490. In 1951, the occupant of those facilities had a salary of $6,600. His rent was $40 a month.

As we all know, salaries for Federal employees were increased a year ago. The salary of the occupant of that housing unit was $7,240. His rent, a year later, after a sizable increase in salary, was still $40 a month.

Mr. MCDONOUGH. You mean frozen at that figure by the Rent Control Administrator?

Mr. FORD. Well, it was still there for two reasons:

One, the Department of the Army had been negligent in taking the necessary action.

Secondly, I am certain that in this area the Rent Control Administrator still controlled rents, and the Army hadn't gotten around to petition and get the approval of the Rent Control Administrator.

Mr. MCDONOUGH. Is that home built on Government-owned land? Mr. FORD. Oh, yes; part of a project.

Here is Fort Peck, Mont., one of the big projects under our committee jurisdiction: dwelling type, five-room frame, two bedrooms; built in 1934 at a cost of $13,794; present value, $9,104; salary of occupant in 1951, $5,800; and he was paying $35 a month rent.

Mr. MULTER. Are these in large part, Mr. Ford, civilian personnel, or are they military personnel?

Mr. FORD. That is an important point and one which should be brought out at this point.

When a military man, a man in uniform, occupies these quarters, he loses his rental allowance. So, whatever his rental allowance might be and that depends upon his grade or rank-he loses it in

toto.

These are all civilian examples which I am giving here.

As I said, the man's salary in 1951 was $5,800. He was paying $35 a month rent.

Congress last year increased his salary to $6,540, and he is still paying $35 a month rent.

I have a number of examples here that are as good as those that I have given to you.

Now, all through our hearings, whenever we came to a project where the Army engineers wanted substantial funds

Mr. BARRETT. Mr. Ford, who would you claim to be negligent there, the project manager or the area rent expediter?

Mr. FORD. Well, in the first instance, our committee feels that the Department of the Army and the Department of Defense are quite responsible, and in our committee hearings, this year, here is what we had to say about it [reading]:

In the hearings in connection with the civil-functions appropriation bill, 1952, the committee called to the attention of the Government witnesses the lack of an adequate rental policy for federally owned quarters. The schedule of rates then in effect in the Corps of Engineers was formulated on August 1, 1948, and is listed below

and they give the ridiculously low rentals.

97026-52-pt. 2-49

.

We end up the comment in this way, "Such dalliance on the part of the agencies involved is inexcusable and they are directed that the new rental rates are to be placed into effect as quickly as possible, and at all events not later than July 1, 1952, in the agencies involved in this bill."

Mr. MCDONOUGH. Is there any shortage of housing in any of these projects?

Mr. FORD. Wherever the Corps of Engineers goes in to build a project, and there is a housing shortage in the area, they include in the cost of the project the necessary funds for the construction of adequate housing facilities. Let me give you a couple of examples. Mr. COLE. While you are doing that, may I break in?

Mr. FORD. Surely.

Mr. COLE. It isn't only the Corps of Engineers that is doing that, Mr. Ford; it is all the other agencies that have housing on their Government-owned property as well.

Mr. FORD. That is absolutely correct, but I am trying to stick to the record that I know about. I am sure that similar conditions prevail in every other agency of the Federal Government.

Mr. COLE. I happen to know so.

Mr. FORD. Here on page 186 of our hearings for fiscal year 1953, we are interrogating a general about the fund request for Ice Harbor lock and dam, which is out at Pasco, Wash.

In the request for funds they have asked for $3,523,000 for the construction of housing facilities. In other words, they want to put in housing facilities with utilities and landscaping and so forth, at a cost of $3,523,000, and if our committee had given them the funds, which we didn't, they would have charged precisely the same ridiculously low rental rates that they have been charging for so long.

I am sure that it would have been a continuation of their past policies.

Now let me just give you a breakdown on that.

They wanted to construct 40 three-bedroom, permanent houses at a cost of $18,000 each, totaling $720,000.

And under their present rental policies, the Federal Government couldn't possibly have gotten any return on the investment. It is a gross example of the worst kind of bureaucracy, first on the part of the Army engineers, the Department of Defense, and now this superimposition of rent-control authority by the Housing Expediter or his

successor.

Mr. MULTER. Mr. Ford, I think you overlook the fact that we long ago wrote into the rent-control legislation a provision that it shall not apply to new construction. What we have done here is to put the Government, as a landlord, on the same basis as any other property owner. It doesn't apply to new construction.

Mr. FORD. I am only trying to bring the problem to the attention of the committee.

Mr. MULTER. I am not finding fault with you, Mr. Ford. This question also presents itself to me: Did the Department also try to justify the low rents on the basis or theory that they couldn't get these civilian employees to go into these places unless they supplied these accommodations at these low rents?

Mr. FORD. That is one of the factors that they have tried to use. and

Mr. MULTER. Is there any substance to their claim?

Mr. FORD. I think there is to this degree. In other words, if you ask a man go up into an isolated area for a Fish and Wildlife experimental station, obviously you have to make it somewhat attractive to him.

Mr. COLE. It is to a degree, but I am quite certain that it is a matter of policy throughout the Government. So, they are following a policy, irrespective of whether or not it is an isolated area.

Mr. MULTER. Policy of low rents?

Mr. COLE. Yes.

Mr. MCDONOUGH. Your argument to the committee then, Mr. Ford, is this, as I get it: That all Government-owned housing facilities be taken out from under rent control?

Mr. FORD. I say, in effect, that because the past record has shown to me that the Federal agencies in and of themselves, are and have been doing an adequate job of protecting tenants-there is no doubt that they have protected the tenants very well-the present provision in the law prevents the Federal Government from getting a fair return on its investment in these homes.

Mr. MCDONOUGH. What would you say that house at Fort Peck should rent for if there was no control by the Rent Control Administrator?

Mr. FORD. Frankly, I am no authority on what a rental policy should be, except that I know what rental policies are in my home town. I know that a man who lives in a five-room frame two-bedroom house and is earning $5,800 a year pays more than $35 a month. Certainly he pays more than $35 a month if he is making a salary of $6,540.

Mr. MCDONOUGH. A further question is this: If the bill were amended to remove this section 206, would the Administrator of those Federal housing units increase the rent to give a fair return? Can you answer that?

Mr. FORD. Well, they didn't for 9 months, but that wasn't entirely the fault of the Army engineers. That was the fault of the Secretary of Defense, and the difficulty of trying to get Government agencies together to settle a problem.

You see, our subcommittee raised the devil with the Army engineers a year ago-in April. They, appropriately, went back to the Department of Defense and said, "We have got to do something about it."

The Department of Defense then appointed a study commission to get together to try to set a policy for all agencies under the Department of Defense. When they came back to our committee in January of this year, they were still arguing, the Army and Navy and Air Force, as to what the policy change should be.

In the meantime, on February 1, Mr. Tighe Woods froze all rents on federally owned housing facilities. So, all the work of this interdepartmental committee, in the Department of Defense, was about to go for naught, except that Mr. Woods said: "Well, you can act just as any other landlord. You should petition us for an increase in rentals.

You know how much time and how much cost will be involved when two Federal agencies get together to try to determine what a

new rental should be on a housing unit out in Fort Peck, Mont., or anyplace else.

Here is the unfortunate part of it, Mr. Chairman, as I indicated, the Fish and Wildlife Service requested our subcommittee to appropriate $4,900,000. Included in that was $306,000 for 19 residences in the Columbia Valley.

When our subcommittee found out what the rental policies were that they had pursued and were going to pursue under Mr. Tighe Woods' directive, we didn't give them any money.

Now, all you are doing is hurting the individual agencies by having this rent-control policy, that we now have, in effect in the future.

And in the case of Ice Harbor lock and dam, the case that I mentioned earlier, they wanted, for the project, for the next fiscal year, $5 million, I believe, and included in that was the money that I indicated for 40 three-bedroom permanent houses.

When our subcommittee saw the rental policies they have been following, we didn't give them any money.

Mr. BROWN. At this point I want to congratulate you on the remarkable statement you just made. I agree with you. And I want to congratulate you on the exhibits that you have to illustrate your point. It shows you have given this problem a lot of time. I hope we can get something done. There is no reason in the world why a $16,000 home should rent for $25 or $30 a month anywhere. Mr. MCDONOUGH. Mr. Chairman.

Mr. BROWN. Mr. McDonough.

Mr. MCDONOUGH. Under the terms of the bill we passed last year, the Rent Control Administrator could not apply rent control where it previously had not been applied, unless he made a finding, under the direction of the Defense Mobilization Director and the Secretary of Defense, that this area was a critical defense area.

Are these areas you are talking about critical defense areas? Mr. FORD. In this budget presentation by the Fish and Wildlife Service, I now turn to the portion where they wanted to get some funds for a Bonneville hatchery, out in the Bonneville area, and included in the Bonneville request was $40,000 for three residences. I am almost certain that in the Bonneville area they still have Federal rent control. And if that is the case, and they had built these residences, with funds requested, the interference by the Housing Expediter, or the Rent Control Director, would have existed in the future.

Mr. MCDONOUGH. Well it would seem to me that if the committee addressed a letter to the Secretary of Defense and asked him if these areas that you are complaining about had been declared critical defense areas under his direction, and he found that they had not been, that Mr. Woods' directive would have no effect in those areas.

Mr. FORD. That is correct; in any area where there is nɔ Federal rent control, of course, these examples that I have mentioned are not applicable.

But I think you will find, wherever the Federal Government goes in to build a huge project-hydroelectric power project—and where they have to build housing accommodations, almost without saying, there is a critical housing shortage. I mean the mere fact that they have to build housing facilities is indicative of the fact that there aren't sufficient housing facilities available.

So then you can almost rest assured that Mr. Woods has some jurisdiction over the matter.

I do not want to take too much time, Mr. Chairman. I have taken altogether too much now. But it is a problem that we see, on the Appropriations Committee, that just does not make sense.

Mr. MULTER. Mr. Ford, there is not any doubt that it is a problem that requires attention, but I wonder if you have not overlooked that we have two different types of Government housing.

You have the Government housing you have told us about, which is being maintained in connection with a Government project. Government land, Government-owned buildings, and rented to people employed by the Government.

In addition we have Government-owned housing which the Government has not yet been able to dispose of, built in World War II, where the Government is just a landlord. And that was what really brought this about, this change in the law. It was projects like Greenbelt, Md., where the Government raised the rents arbitrarily 150 percent. We, and all the Congressmen from Maryland, were flooded with complaints about that kind of action. The Government said, "You, Mr. Private Landlord, have got to be decent and not extract extortionate rents," and then it turned around and did the very thing it did not want private landlords to do.

It was that situation that we had in mind in changing the law. I think in the main, in the Government projects, where these civilians are living on Government land, in Government housing, the agency involved is being lax. I think they could go in and almost automatically get an increase in rents, by merely submitting the appraisal they have made, and the review and surveys they have made, in order to determine whether they can raise the rents and by how much. All they would have to do is present that to the Agency and they would get the increase.

But I think they are hiding behind this change in the law to cover up their dereliction of duty before we changed the law.

Mr. FORD. I agree with you to a large extent, Mr. Multer, that these agencies that have come to my attention are now hiding under the rent directive which was issued by Mr. Woods on January 31, 1952.

But I feel so strongly about this situation that I don't want to give them any escape valve, so that they can get out from under and say, "Well, Mr. Woods is putting it on us now.

Let's put them on the carpet and not let them escape with some weak alibi, which in my judgment should not be an alibi, but it is just. what they have been using.

Thank you very much, Mr. Chairman and members of the committee.

Mr. BROWN. Congressman Burleson is our next witness.

STATEMENT OF THE HON. OMAR BURLESON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS

Mr. BURLESON. My name is Omar Burleson, a Member of the House from the Seventeenth District of Texas.

Mr. Chairman and members of the committee, I am most grateful for the opportunity of appearing before you, and I shall be as brief