1940: Housing Developments

Housing for Defense Workers.

As 1939 drew to a close, a steadily growing group of citizens interested in comprehensive rehousing and rehabilitation efforts, both rural and urban, saw public housing programs as a significant contribution of a vital democracy to the maintenance of the American way of life. In 1940, however, under the lengthening shadows of war holding grave dangers for the American continent, public policy affecting housing found an abrupt re-orientation. By mid-year industrial expansion in aircraft, shipbuilding, military weapons and related industries focussed attention on dangerous housing shortages and highlighted the problem of hopelessly inadequate housing conditions. By the year's end the greatest emphasis lay on the production of homes for emergency defense workers.

On June 28 President Roosevelt approved the first defense housing measure—Title II of Public No. 671, 76th Congress. It authorized the United States Housing Authority to participate in the provision of 'necessary . . . housing for persons engaged in national defense activities.' A Housing Coordinator, acting under the direction of the Advisory Commission to the Council of National Defense was appointed July 21. The Coordinator became directly responsible to the Advisory Commission for expediting all housing developments in connection with defense activities, particularly where industrial expansion was creating an urgent need for additional housing facilities. A staff was quickly organized to make the most effective use of existing governmental and private facilities. In a first public address on Oct. 5 the Coordinator stated that the need for 200,000 additional family units in 216 communities was already evident and that the funds provided by the Congress enabled various agencies of the Federal Government to construct or aid in the construction of considerably less than half of these.

A bill approved on Sept. 9 appropriated $100,000,000 to provide housing for civilian and enlisted personnel and workers in industries essential to the military and naval national defense programs. This resulted almost immediately in the planning of a program for at least 12,600 units for the Navy and approximately 14,000 for the Army, all units to be used exclusively for low-income civilian and enlisted personnel connected with military and naval establishments. An additional 700 units were to be constructed for shipyard workers under the supervision of the Maritime Commission. These plans envisaged the use of some $95,000,000 of the $100,000,000 appropriation.

The United States Housing Authority, out of its dwindling funds, made available slightly over $31,000,000 to provide homes for 8,133 defense workers, again almost exclusively civilian and enlisted personnel of the Army and Navy. More than $24,000,000 of this sum was covered by loan contracts with local housing authorities, covering 6,408 homes in 21 projects (although later consolidations resulted in an official total of 19), sprawled over the map from Hartford, Conn., to Jacksonville, Fla.; from Newport, R. I., to Seattle, Wash. By the close of 1940, 17 of the 19 projects were under construction and a number complete. USHA had also allocated $7,225,000 to the Army and Navy for 4 projects providing 1,725 new units in localities such as Anchorage, Alaska and the Panama Canal Zone areas, where development by local housing authorities was not possible.

On Oct. 14 the Lanham Act (Public No. 849, 76th Congress) authorized $150,000,000 for the use of the Federal Works Administrator to provide still further housing for defense workers in the three categories already described. This Act permitted the Federal Works Administrator to utilize other Federal agencies and to cooperate with any local public agency. In late November the first projects were assigned in accordance with the Lanham Act: three to the Public Buildings Administration; six to the United States Housing Authority, to be developed on the basis of arrangements made with the local housing authorities; one to the Navy Department; and one to be handled directly by the Administrator's office. Meanwhile the War Department, which preferred to be free to concentrate on construction of a direct military nature, asked the Public Buildings Administrator to undertake the construction of the housing units it needed. By the end of 1940 the Federal Works Agency had announced approval of 18,932 dwelling units in 91 projects (excluding the six Lanham Act projects assigned to the USHA). Twenty-one of these projects, involving an estimated cost of $20,332,000 and providing 6,845 dwelling units, had been placed under construction contract.

The precedent of housing construction by Federal agencies had been established in the World War of 1914-18. Then the Congress was more cautious and slow in understanding the urgent necessity for housing construction. Considerably less argument was heard in 1940. The existence of hundreds of local housing authorities, many of whom had several years' experience in analyzing local housing needs and perfecting procedures for designing, constructing and managing housing units in their communities, gave promise of a sound defense housing program. A significant new element was a clearly marked tendency to keep on stressing long-term problems in the hope that carefully matured plans would make possible an expanded housing program that would be a strong bulwark against post-war depression.

USHA Record.

In the hurly-burly of defense legislation, a bill to provide an additional $800,000,000 for USHA's normal slum-clearance and rehousing program quickly died for lack of favorable action by the House of Representatives. In celebrating its third anniversary on Nov. 1, 1940, however, the USHA could point to a praiseworthy record. On Dec. 1, 1940, 480 USHA-aided projects had been placed under loan and annual contributions contracts. The projects had a total estimated development cost of $747,208,000 and provided for 156,692 dwelling units, in 218 different localities in 37 states and several territories. Of these 480 projects, 330 involving a total estimated development cost of $51,627,000 had been placed under construction or completed; 114 had been opened for occupancy and 32,866 dwelling units in 75 localities of 22 states and territories were occupied.

Most important, construction costs, rentals charged and subsidies required decreased as the USHA and the local housing authorities gained experience during 1940. The average estimated net construction cost per unit had been reduced to $2,585 during the last half of 1940 and was $2,717 for the total contemplated program. The average monthly shelter rent for projects with rental schedules set up and approved was $12.78 per unit and the average family income anticipated for tenants in these projects was $799 a year. During 1940 the average subsidy anticipated was about 20 per cent less than the legal maximum. Though the assumption was rather generally made a few years ago that maximum subsidies should be utilized in all projects to achieve low rents, the principle of varying subsidies in accordance with local conditions was rather widely accepted by the end of 1940.

A modest program of rural housing was initiated by USHA during the year. A careful beginning made by six county housing authorities provided for 1,300 farm homes at a total estimated development cost of $2,805,000. The first of these farm homes was completed and occupied during 1940 and the USHA was sufficiently encouraged to consider further commitments from its remaining funds for rural projects.

Genuine civic improvement was likewise recorded in concrete terms as the construction activities under the USHA-aided program advanced. Not only did the new developments represent community assets, but slum elimination activities in connection with 173 projects accounted for a total of 44,137 unsafe and unsanitary dwellings torn down, compulsorily closed or adequately repaired by Dec. 1, 1940. A sizeable contribution to the solution of the unemployment problem is indicated by USHA's 1940 estimate that 115,000 man-years of direct employment for building trades employees would result from the construction of the projects included in its total program. Additional indirect employment away from project sites was estimated at 170,000 man-years.

The plan of short-term borrowings from private sources to provide funds during the construction period, initiated in 1939 to achieve reductions in debt service, was widely used during 1940. By Dec. 31, net USHA advances to local housing authorities totaled $76,750,536.22, in addition to short-term borrowings of local authorities totaling $246,476,000. Bonds in the total amount of $18,604,000, providing local participation in the capital costs of projects, had likewise been sold to private investors. In accordance with the agreements to purchase long-term local securities contained in local contracts, USHA had accepted long-term bonds of the local housing authorities in the total amount of $99,801,000. Revision of many loan contracts during the latter half of the year, designed to take advantage of a reduction in the Federal going rate of interest, will eventually result in further reductions in debt service.

The number of local housing authorities rose to more than 500 in the 38 states with legislation enabling the creation of such agencies. No new state 'enabling' laws could be passed during the year because the legislatures of the states lacking such laws—Iowa, Kansas, Maine, Minnesota, Nevada, New Hampshire, Oklahoma, South Dakota, Utah and Wyoming—did not convene. There are, however, indications of the passage of housing 'enabling' laws by the legislatures of Iowa, Minnesota, and Utah during 1941. Indicative of the legal base of the decentralized housing program was the fact that, as of the end of 1940, 43 decisions on public housing legislation, all of them favorable, had been handed down by the highest courts of 27 states.

Federal Housing Administration.

Increased activities continued to be reported by the Federal Housing Administration. Total FHA insurance reached a figure of $4,076,264,676 by Dec. 31, 1940, an increase of slightly over $1,000,000,000 during the year. The greatest part of the funds provided by the FHA to approved lending institutions was used for buying, building and modernizing small homes. More than 634,000 premium-paying home mortgages accounted for $2,706,352,739 of the total FHA insurance.

In line with the growing recognition of the importance of homes for lower income families, FHA continued last year to place special emphasis on livable small homes. At the end of eleven months it was reported that at least one-half of the new homes financed by FHA-insured loans were being purchased by families with annual incomes ranging from $1,000 to $2,500.

A slow but steady decline in the average amount of new-home mortgage loans accepted for insurance was also noted. The average at the end of ten months' experience in 1940 was $4,417—as compared with an average of $4,824 in 1935 and $4,638 in 1937. Since February 1938, however, FHA has been authorized to insure loans of up to 90 per cent of property valuation rather than 80 per cent, as formerly. And the higher proportion of valuation must be borne in mind in evaluating the significance of the declining averages. The higher percentage mortgage loans so far have not entailed excessive losses. The experience is not yet conclusive, but a record of 186 acquired after foreclosure, out of nearly 250,000 properties with mortgages exceeding 80 per cent of valuation, seems to represent a favorable credit experience and justify further governmental efforts to facilitate home ownership for families of modest means.

During the fiscal year 1940-41 operations of FHA are to become self-supporting and an additional $9,000,000 transferred to insurance reserves out of current revenues. About two-thirds of operating expenses were paid out of revenues during the preceding fiscal year in addition to some increases to reserves. More than 8,000 lending institutions had FHA-insured mortgages in their portfolios at the end of 1940. Approximately 3,000 institutions were participating in property improvement loans under Title 1 of the National Housing Act.

Farm Security Administration.

While not primarily a housing agency, the Farm Security Administration (FSA) announced in its report for the fiscal year 1939-40 the construction of 2,056 new homes, built at an average cost of $1,313. During the year arrangements were made by FSA to open unused portions of the land in its three greenbelt community projects to further development by private builders. Greenbelt, Maryland, Greenhills, Ohio, and Greendale, Wisconsin, as completed by FSA, contained 2,133 suburban homes in 1940. Under the 1940 plan, new houses in the projects may be sold or rented without income restrictions on the residents. To preserve the character and general plan of the original communities, FSA reserved the right to pass upon proposed plans and specifications for any additional houses.

A notable development was the intensive use of camps as part of the FSA program to provide shelter and sanitary facilities for migrant farm labor families. The problems of migratory labor aroused such serious concern during the year that the House of Representatives adopted a resolution calling for a comprehensive survey. As a result, FSA concentrated its major attack on stopping migration at its source, particularly in Kansas, Oklahoma, Arkansas, Texas, Missouri and California. A report for the fiscal year 1939-40 indicated that 56 FSA camps, capable of accommodating a total of 13,205 families at any one time, were either complete or under construction in Idaho, Oregon, Washington, California, Arizona, Texas and Florida. Of the 56 camps, 16 provided mobile facilities—tents, power plant, etc.—that can be hauled from place to place by trucks and trailers. All in all, temporary FSA shelters and tent platforms provided accommodations for 11,476 families. Some 1,729 permanent units, inexpensive houses with small garden plots, provided homes for rural low-income families.

Another new development in FSA may be cited as evidence of increasing general concern during 1940 about the relationship between housing and health. Because poor health was observed to be one of the gravest handicaps of low-income farm families, FSA began to develop a medical care program for its rehabilitation borrowers. County medical plans, worked out in close cooperation with state medical associations and local medical societies, were established in 634 counties in 31 states. More than 80,000 families have joined in these plans. Plans were organized in 245 new counties during the fiscal year ended June 30, 1940.

Health Problems.

Within the year much publicity was given to the findings of the National Health Survey. Staff members of the U. S. Public Health Service were assigned to act in an advisory capacity to housing agencies. Municipal health officers began to work closely with local housing authorities, sometimes establishing clinics in new public housing projects. Nutrition advisers, pediatricians, and nurses were detailed for part-time service in the nursery schools in these projects. Professional associations of health officers and nurses gave increasing attention to the relationship between good housing and good health in their national and state conferences. Many American officials and publications called attention to the vast improvement in the health of the English people as indicated by the medical examinations made under the British Military Training Act. The explanation assigned was extensive governmental investment in social services, particularly better housing, during the 1920's and 1930's.

Future Outlook.

The radical changes likely to occur in the housing pattern of most American industrial cities under the impact of the defense program will depend to a considerable extent upon housing data collected in the course of the decennial census during 1940. It is interesting to note that certain trends suspected by experts seemed to be verified by figures released by the Bureau of the Census. Although the growth of population had slowed down to 7 per cent, the number of private households had increased from 29,904,663 to 34,772,673—approximately 16.3 per cent. This trend prevailed even in cities of static or declining population. As the national birthrate declined, the average number of persons per family fell from 4.1 in 1930 to 3.8 in 1940. For the first time in our history the residential units in existence, both in city and country, were counted. The total turned out to be 37,211,463. The 1940 census also indicated that suburban areas were growing faster than the cities adjacent to them, giving point to the warnings of housing officials that rehabilitation rather than further subdividing must be encouraged, lest parasitic suburban growth destroy the parent city.

Although attention was being given to a host of new problems at the close of 1940, progress had been made along more conventional lines: in the understanding of the economics of housing problems, in survey and planning techniques, in house design and construction, in realizing the need for effective enforcement of sanitation and occupancy standards, and in the professionalizing of housing management. The problems of rural housing were still without generally accepted solutions. Construction costs, including both labor and materials, began to rise. Most indexes showed costs only slightly below 1929 levels.

The total construction of new, non-farm housing accommodations for 1940 was estimated at 545,000 dwellings by the Bureau of Labor Statistics of the U. S. Labor Department. This is the highest figure for a 12-year period and compares with 465,000 units in 1939 and 509,000 in 1929. Building of boom proportions seemed not unlikely for 1941, inevitably carrying with it the temptation to relax housing standards. To a noticeable extent, however, public officials continued to be mindful of the period when the high tide created by defense orders must recede and national energies can be creatively expended in producing a more adequate physical environment. See also ARCHITECTURE and CIVIL ENGINEERING.