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9/12/75 - Washington Press Club
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9/12/75 - Washington Press Club
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This file contains material relating to Pruitt - Igoe Project, Community Development Act.
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Carla A. Hills Speeches
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The original documents are located in Box 1, folder "9/12/75 - Washington Press Club" of
the Carla A. Hills Speeches at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 1 of the Carla A. Hills Speeches at the Gerald R. Ford Presidential Library
d
FINAL II 2
WASHINGTON PRESS CLUB
SEPTEMBER 12, 1975
You ARE AWARE, I'M SURE -- SINCE MY CRITICS DURING
MY SENATE CONFIRMATION HEARINGS KEPT LETTING THE BIG
SECRET OUT OF THE BAG -- THAT I'M NOT WHAT IS KNOWN AS
A "HOUSING EXPERT".
THAT'S FAIR ENOUGH -- BECAUSE IT RELIEVES ME OF ANY
PRESSURE TO FOLLOW THE PLANS MAPPED OUT BY SOME OF THE
"BIG HOUSING THINKERS" WHO HELPED GET US TO WHERE WE ARE
TODAY.
BUT, IT DOESN'T TAKE MUCH OF AN "EXPERT" TO KNOW THAT
HOUSING PRODUCTION IS IN THE CELLAR AND OUR CITIES ARE
STRUGGLING FOR SURVIVAL.
THE COMPLAINTS ROLL IN FROM SUPPLIERS, BUILDERS,
PLANNERS, HOUSEHOLDERS AND THOSE WHO CAN'T AFFORD A HOUSE.
DESPITE THE BILLIONS OF TAXPAYER DOLLARS POURED OVER
THE PAST DECADE INTO THE IDEAL OF "PROVIDING A DECENT HOME
AND LIVING ENVIRONMENT FOR EVERY AMERICAN FAMILY", 16 MILLION
HOUSEHOLDS IN THIS NATION ARE OFFICIALLY CLASSED AS. "THE
HOUSING POOR".
GERALD R.
FORD LIBRARY
-2-
WHEN YOU THINK ABOUT IT, WHO WOULD EVEN WANT TO BE
AT HUD AT A TIME LIKE THIS?
WELL, I WOULD!
Yes, WE HAVE PROBLEMS, LOTS OF THEM. AND, SOME OF
THEM ARE AGONIZING, BUT WE FACE A CHALLENGE THAT IS WORTHY
OF ALL OF OUR ENERGY, CREATIVITY AND HORSE SENSE,
As A PRELUDE TO YOUR QUESTIONS, I THOUGHT YOU MIGHT WANT
TO KNOW HOW THIS "NON-HOUSING EXPERT" HAS SET HUD's PRIORITIES
FOR TACKLING SOME OF THESE TOUGH PROBLEMS,
FIRST, AND HIGH ON MY LIST, IS THE JOB OF HELPING TO
PRESERVE AND RECYCLE OUR CITIES. WE MUST COMBAT THE NOTION
THAT THE BEST WAY TO COPE WITH A WORN-OUT CITY NEIGHBORHOOD
IS TO THROW IT AWAY AND BUILD A NEW ONE A LITTLER FURTHER OUT,
DID YOU KNOW THAT BACK IN THE 50's, THE "EXPERTS" REFUSED
TO INSURE MORTGAGES IN GEORGETOWN?
FORD LIBRARY
&
0720
-3-
THE WIZARDS OF HOUSING SAID THAT OLDE GEORGETOWN HAD
TAKEN THE FINAL COUNT, AND IT WAS TIME TO MOVE ON,
GEORGETOWN WAS NOT ALONE!
FOR YEARS -- IN ALL PARTS OF THE COUNTRY -- PRIVATE
AND PUBLIC MONEY LITERALLY UNDERWROTE THE SUBURBAN SPRAWL.
TODAY, THAT RING UPON RING OF SUBURBS AROUND OUR CENTER
CITIES HAS CONSUMED MILLIONS OF SQUARE MILES OF OPEN SPACE
-- WHILE ENCOURAGING THE WASTE OF INVALUABLE URBAN RESOURCES.
THE WASTE WAS NOT JUST IN UNCOUNTED MILLIONS OF DOLLARS
-- BUT IN THE HUMANITIES AS WELL,
FOR EXAMPLE, IN NEW YORK CITY ALONE, 35,000 UNITS OF
HOUSING WERE ABANDONED LAST YEAR.
"THERE IS DARKNESS AND DECAY IN THE HOUSE" -- SAID
EDWIN ARLINGTON ROBINSON -- "THEY HAVE ALL GONE AWAY. THERE
IS NOTHING LEFT TO SAY."
FORD
-4-
WELL, I INTEND TO SAY SOMETHING ABOUT IT.
AN ABANDONED HOUSE ISN'T JUST AN OLD DERELICT DOWN BY
THE RAILROAD IN AN EDWARD HOPPER LANDSCAPE,
ABANDONED WITH THAT HOUSE ARE A PART OF ALL OF THE
THINGS THAT MADE IT LIVE.
MUNDANE THINGS -- LIKE WATER AND SEWAGE LINES, ROADS
AND TRANSPORTATION SYSTEMS AND UTILITIES,
VITAL THINGS -- LIKE THEATERS, SCHOOLS AND CHURCHES,
AND PRECIOUS PIECES OF THE HISTORY AND CULTURE THAT
GIVE THE CITY MAJESTY,
A TIGHTER ECONOMY, A SCARCITY OF ENERGY, AND CHANGING
DEMOGRAPHIC TRENDS NOW DEMAND US TO USE ALL THE INGENUITY
WE CAN SUMMON TO PRESERVE AND RECYCLE THESE ASSETS,
OUR STUDIES CONCLUDE STATISTICALLY WHAT WE SHOULD HAVE
CONCLUDED INTELLIGENTLY MORE THAN A DECADE AGO: THAT IT IS
FAR LESS COSTLY TO RECYCLE A CITY THAN TO BUILD A SUBURB,
FORD
-5-
IN FACT, AN URBAN REDEVELOPMENT PROGRAM CAN CONSUME
ABOUT 50 PERCENT LESS OF EVERYTHING -- LAND -- CAPITAL --
ENERGY -- AND, AT THE SAME TIME, CREATE HALF AS MUCH AIR
POLLUTION.
FORTUITOUSLY, THE OLD POLICIES OF WASTE NOT ONLY COLLIDE
WITH SKINNIER POCKET-BOOKS, BUT ALSO COLLIDE WITH RECENT
CHANGES IN THE WAY AMERICA LIVES. THERE HAS BEEN A REMARKABLE
INCREASE IN ADULT-ORIENTED HOUSEHOLDS. SINGLES, YOUNG
MARRIEDS, CHILDLESS COUPLES AND ELDERLY ACCOUNT FOR 82 PERCENT
OF THE NATION'S NET POPULATION GAIN BETWEEN 1970 AND 1973.
THERE IS A GROWING NEED FOR LOW AND MODERATE COST HOUSING
ACCESSIBLE TO JOBS AND JOB OPPORTUNITIES, AND FOR NEARBY
SHOPPING FACILITIES, ENTERTAINMENT AND CULTURAL AMENITIES.
WE CAN DO SOMETHING ABOUT THESE NEEDS, AND IN so DOING
WE CAN BREATHE LIFE INTO OUR CITIES.
FORD
-6-
WE HAVE JUST CELEBRATED THE FIRST BIRTHDAY OF THE
HOUSING AND COMMUNITY DEVELOPMENT AcT OF 1974.
AT THE SIGNING CEREMONY LAST AUGUST, PRESIDENT FORD
CALLED IT A "LANDMARK", AND SENATOR JOHN SPARKMAN -- WHO
THEN CHAIRED THE BANKING AND CURRENCY COMMITTEE, CALLED IT
THE MOST IMPORTANT COMMUNITY LEGISLATION SINCE THE HOUSING
Act OF 1949.
AND, IT IS,
FOR THE FIRST TIME THE FEDERAL GOVERNMENT IS PROVIDING
RENTAL SUBSIDIES -- $1.6 BILLION THIS YEAR -- TO HELP HOUSE
OUR LOWER-INCOME FAMILIES IN EXISTING AND SUBSTANTIALLY
REHABILITATED UNITS, AS WELL AS NEW, GIVING PREFERENCE WHERE
THERE IS AN ECONOMIC MIX.
FOR THE FIRST TIME THE LOCAL COMMUNITIES DIRECT HOW,
WHEN, AND WHERE FEDERAL COMMUNITY DEVELOPMENT FUNDS ARE
SPENT -- MORE THAN $8 BILLION OVER 3 YEARS -- $2.6 BILLION
OVER THE PAST FISCAL YEAR.
-7-
GONE IS THE OLD GAME OF GRANTSMANSHIP. HUD NOW
DISTRIBUTES FUNDS ON THE BASIS OF OBJECTIVE DATA OF POVERTY,
HOUSING OVERCROWDING AND POPULATION, IT PERMITS THE LOCAL
RECIPIENTS TO CREATE THEIR OWN COMMUNITY DEVELOPMENT PLANS
THAT DIRECTLY ADDRESS THEIR REALISTIC LOCAL NEEDS,
THE INVIGORATING THING ABOUT THIS NEW APPROACH IS THAT
IT IS WORKING. OUR FIRST YEAR WITH COMMUNITY DEVELOPMENT
FUNDS SEEMS TO SHOW UNMISTAKABLY THAT IF THE FEDERAL
GOVERNMENT KEEPS ITS HEAVY HAND OUT OF LOCAL DECISION-MAKING,
THE CITIES ARE UP TO THE TASK.
CLEARLY THE NEW SCHEME HAS THE BLESSING OF THE RECIPIENTS.
SEVENTY-EIGHT PERCENT HAVE TOLD US THAT COMMUNITY DEVELOPMENT
GRANTS SIGNIFICANTLY INCREASED THEIR ABILITY TO RESPOND TO
LOCAL PROBLEMS, EIGHTY PERCENT WELCOMED THE SHARP REDUCTION
IN THE RED TAPE WHICH USED TO ATTEND FEDERAL ASSISTANCE,
BUT MOST IMPORTANTLY, WE SEE THAT MORE THAN 66 PERCENT
OF HUD's GRANTS HAVE BEEN USED TO PRESERVE DECLINING AND
BLIGHTED NEIGHBORHOODS AND TO PROVIDE THE PUBLIC SERVICES
NECESSARY TO SUPPORT THESE EFFORTS,
-8-
I DON'T THINK YOU CAN ACHIEVE VERY MUCH UNLESS YOU
TRY NEW THINGS, So, WE ARE EXPERIMENTING WITH METHODS TO
ENCOURAGE RECYCLING OF INNER-CITY RESOURCES. FOR EXAMPLE,
HUD IS MOVING AHEAD WITH AN URBAN HOMESTEADING DEMONSTRATION
TO SEE WHETHER A COMBINATION OF FEDERAL, LOCAL, AND PRIVATE
EFFORT CAN REVERSE THE DECLINE OF AN URBAN NEIGHBORHOOD.
HUD WILL PROVIDE THIS YEAR $5 MILLION WORTH OF SECRETARY-
HELD HOUSES PLUS AN ADDITIONAL $5 MILLION IN REHABILITATION
LOANS. BUT THE COMMUNITIES WILL DEVELOP THE HOMESTEADING
PLANS, AND I THINK THIS IS AN IMPORTANT POINT.
ALSO, HUD HAS PUT INTO ACTION A PROPERTY DISPOSITION
PROGRAM, WHEREBY CITIES CAN RECEIVE, AT NO COST, HUD-HELD
PROPERTIES. THIS IS ANOTHER EXPERIMENT IN PROVIDING A
RESOURCE FOR INNOVATIVE COMMUNITY USE.
WE ARE MAKING SUBSTANTIAL EFFORTS TO COORDINATE OUR
PROPERTY TECHNIQUES MORE CAREFULLY WITH THE COMMUNITY
DEVELOPMENT PROGRAMS OF THE LOCALITY,
-9-
WE ARE EXPERIMENTING WITH LEASE-PURCHASE AGREEMENTS
WHEREBY LOWER-INCOME FAMILIES CAN LEASE HUD-OWNED PROPERTIES
WITH A SUBSEQUENT OPPORTUNITY TO ASSUME HOMEOWNERSHIP,
WE HAVE SOUGHT TO ACT AS A CLEARINGHOUSE TO ASSIST LOCAL
COMMUNITIES IN THEIR PRESERVATION ACTIVITIES. IN LATE SPRING
WE PUBLISHED A NEIGHBORHOOD PRESERVATION CATALOGUE. THE
CATALOGUE DESCRIBES 100 OF THE MOST INNOVATIVE AND SUCCESSFUL
PRESERVATION INITIATIVES WHICH CITIES HAVE DEVELOPED. I HAVE
SENT EVERY MAYOR, WHO IS A MEMBER OF THE CONFERENCE OF MAYORS,
A COPY,
WE HAVE SCHEDULED A SERIES OF 10 REGIONAL PRESERVATION
STRATEGY WORKSHOPS TO OFFER LOCAL COMMUNITIES ADVICE ON
CONSTRUCTING WORKABLE APPROACHES TO URBAN PRESERVATION.
WE ARE TRULY FOCUSING ON URBAN PRESERVATION AS NEVER
BEFORE,
My SECOND PRIORITY -- NOT IN RANK, ONLY IN PRESENTATION
-- IS TO PROVIDE BETTER SHELTER FOR OUR LOWER-INCOME CITIZENS,
-10-
IN THE PAST WE HAVE RELIED ON THE BUILDING OF NEW PROJECTS
TO HOUSE THE POOR. Too OFTEN, THE CONCENTRATION OF POVERTY IN
THE GOVERNMENT-SUBSIDIZED PROJECTS COMPOUNDED THE PROBLEMS OF
THE TENANTS AND SIMPLY CREATED NEW GHETTO SLUMS FOR OLD ONES.
THE TRAGEDY OF THE PRUITT-IGOE PROJECT IN ST. LOUIS ILLUSTRATES
THE POINT.
DURING THE PAST 90 DAYS WE HAVE STARTED OUR NEW RENTAL
SUBSIDY PROGRAM WHICH ALLOWS OUR LOWER-INCOME FAMILIES TO FIND
DECENT STRUCTURES OF THEIR CHOOSING AND AT A RENTAL THEY CAN
AFFORD.
THE SUBSIDY IS THE DIFFERENCE BETWEEN APPROXIMATELY 25
PERCENT OF A RECIPIENT'S INCOME AND THE COST OF HIS HOUSING,
UNLIKE ITS PREDECESSORS, THIS RENTAL SUBSIDY IS OPEN-ENDED,
AND, COVERS THE GAP BETWEEN THE POOR FAMILY'S INCOME AND THE
SKYROCKETING COSTS OF HOUSING, WE HAVE SEEN TOO MANY HOUSING
PROJECTS WITH FIXED GOVERNMENT-INTEREST SUBSIDIES INCAPABLE OF
SURVIVING THE RECENT RAPID RISE IN OPERATING EXPENSES. THE NEW
OPEN-ENDED SUBSIDY AVOIDS THIS SERIOUS PITFALL,
THE RENTAL SUBSIDY PROGRAM MAXIMIZES THE OPPORTUNITIES FOR
A LOWER-INCOME FAMILY TO FIND THE HOME IN THE NEIGHBORHOOD IN
WHICH IT WANTS TO LIVE.
-11-
AND, I AM COMMITTED TO ENSURING THAT THIS MARKET CHOICE
IN REALITY EXISTS. WITH THE EXISTING HOUSING, WE REQUIRE
THE LOCAL AGENCY WHICH ADMINISTERS OUR RENTAL SUBSIDY PROGRAM
TO HAVE AN EQUAL OPPORTUNITY AND OUTREACH PLAN, TO ENCOURAGE
THE PARTICIPATION OF LANDLORDS OUTSIDE ESSENTIALLY LOW INCOME
OR MINORITY AREAS, AND TO ASSIST THE TENANT IN SECURING
HOUSING IN SUCH AREAS,
WE ARE SENSITIVE TO THE PROBLEMS OF RACIAL AND ECONOMIC
IMPACTION WITH RESPECT TO THE NEW CONSTRUCTION SUBSIDIZED BY
OUR RENTAL SUBSIDY PROGRAM. OUR SITE-SELECTION CRITERIA ARE
INTENDED TO AVOID AGGRAVATING HIGH CONCENTRATIONS OF LOW
INCOME OR MINORITY FAMILIES INSIDE OUR CITIES,
IN MANY URBAN AREAS THE ISSUE OF INTEGRATION CAN BE DEALT
WITH ONLY ON A METROPOLITAN-WIDE BASIS, Too OFTEN, IN THE
PAST, OUR APPROACH TO RESIDENTIAL SEGREGATION HAS BEEN TO
CREATE NEW BUT SMALLER GHETTOS IN THE SUBURBS RATHER THAN TRUE
ECONOMIC INTEGRATION. THE 1974 AcT GIVES US TEETH TO BITE
INTO THE PROBLEM OF METROPOLITAN SEGREGATION,
-12-
COMMUNITIES WANTING OUR COMMUNITY DEVELOPMENT FUNDS
MUST SHOW HOW THEY WILL USE THOSE FUNDS TO MEET THE NEEDS
OF LOWER-INCOME FAMILIES IN THEIR COMMUNITY.
ONE PARAMOUNT NEED THEY MUST ADDRESS IS THAT OF LOWER-
INCOME WORKERS WHO CAN BE "EXPECTED TO RESIDE" IN THE
COMMUNITY. RECENTLY, HUD ISSUED A DIRECTIVE TO ITS FIELD
OFFICES INTERPRETING THIS REQUIREMENT. A LOCAL COMMUNITY
MUST NOW ADDRESS A PROPORTION OF THE HOUSING NEEDS OF ITS
LOWER-INCOME WORKERS WHO DO NOT LIVE IN THE COMMUNITY.
THUS, A FAMILY CAN APPLY FOR RENTAL HELP IN A SUBURBAN
COMMUNITY IN WHICH IT WORKS BUT DOES NOT YET RESIDE, THE
SUBURBAN COMMUNITIES WHICH ENJOY THE TAX BENEFITS OF
EMPLOYMENT CENTERS MUST CARRY A PORTION OF SOCIAL AND FISCAL
BURDENS OF PROVIDING HOUSING FOR THEIR LOWER-INCOME WORKERS,
I WANT HUD TO ASSIST 400,000 RENTAL FAMILIES THIS FISCAL
YEAR,
-13-
My THIRD PRIORITY -- AGAIN, NOT NECESSARILY IN RANK --
IS TO ENSURE A MORE REALISTIC OPPORTUNITY FOR HOMEOWNERSHIP
FOR THOSE WHO WANT IT. THAT REQUIRES GREATER AVAILABILITY
OF MORTGAGE MONEY TO MR. HOMEOWNER.
THE CURRENT CRISIS IN THE HOUSING INDUSTRY ILLUSTRATES
THE "FEAST OR FAMINE" CYCLES WHICH PLAGUE IT.
OVER THE PAST 20 MONTHS HUD HAS OFFERED $15.5 BILLION
TO PURCHASE OVER 500,000 MORTGAGES BEARING INTEREST RATES
LOWER THAN THOSE OFFERED IN THE MARKET, TODAY, WE GUARANTEE
7-1/2 PERCENT MORTGAGES WHEREAS THE MARKET IS AT 9 PERCENT.
MODEST AS THIS INTEREST SUBSIDY MAY SEEM, IT HAS
COMPENSATED, TO A SIGNIFICANT DEGREE, FOR THE RAPIDLY
RISING COSTS OF HOME FINANCING WHICH CLOSE THE DOOR ON
HOMEOWNERSHIP, THERE HAS BEEN A 40 PERCENT IMPROVEMENT
IN THE LEVEL OF HOUSING STARTS SINCE THE FIRST OF THIS YEAR.
-14-
I REALIZE THAT TEMPORARY INTEREST SUBSIDIES DO NOT
SOLVE THE LONG-TERM PROBLEM OF ENSURING A SUPPLY OF MORTGAGE
MONEY. So, WE ARE TAKING STEPS TO INCREASE THE ATTRACTIVNESS
OF MORTGAGE INVESTMENT.
FOR EXAMPLE, WE ARE IMPLEMENTING A CO-INSURANCE PROGRAM
WITH MORTGAGE LENDERS, EXPERIMENTING WITH NEW FORMS OF DEBT
INSTRUMENTS, AND SUPPORTING LEGISLATION THAT WOULD ATTRACT
MONEY INTO THE MORTGAGE MARKET.
My FOURTH PRIORITY IS TO PROVIDE GREATER CONSUMER
PROTECTION FOR HOME OWNERS AND BUYERS, WE ARE SEEKING
LEGISLATION THAT WOULD AUTHORIZE AN ASSISTANT SECRETARY
FOR CONSUMER AND REGULATORY FUNCTIONS AT HUD.
HUD HAS BEEN GIVEN INCREASING REGULATORY RESPONSIBILITIES,
AND I AM ALL FOR IT, RIGHT NOW, WE ARE RESPONSIBLE FOR
PROMULGATING MOBILE HOMES SAFETY AND DURABILITY STANDARDS,
AS WELL AS IMPLEMENTING THE REAL ESTATE SETTLEMENTS PROCEDURE
AcT, AND THE INTERSTATE LAND SALES AcT. LEGISLATION HAS BEEN
INTRODUCED TO GIVE HUD REGULATORY RESPONSIBILITIES IN THE
CONDOMINIUM MARKET,
-15-
I BELIEVE WE CAN -- AND MUST -- DO MORE TO ENSURE
CONSUMER CONFIDENCE IN HOUSING, I SEE OUR GREATEST CHALLENGE
IN PERFORMING OUR ROLE OF CONSUMER PROTECTOR WITHOUT so
ENCUMBERING THE HOUSING INDUSTRY WITH REGULATIONS THAT THERE
WILL BE NO CONSUMERS TO PROTECT.
THESE ARE JUST THE HIGHLIGHTS. THERE ARE OTHERS. HUD
MUST USE ALL ITS ENERGIES TO INCREASE THE EFFICIENCY WITH
WHICH WE DELIVER OUR SERVICES. AND, WE MUST HAVE BETTER DATA
UPON WHICH TO DECIDE THE TOUGH POLICY QUESTIONS WE FACE,
YES, WE HAVE PROBLEMS,
You DON'T HAVE TIME TO HEAR HOW MANY,
BUT, I REPEAT.
HUD IS A GREAT PLACE TO BE IN THIS CHALLENGING ERA.