Senator CHILES. Thank you for your statement. Can you give me your opinion or any of your group as to how you view the particular trade-offs in regard to the special revenue programs that the President is now talking about and which is tied to some of the phaseouts or some of the cutbacks, the reason for some of the cutbacks?

Mr. MAFFIN. In the first place, Mr. Chairman, the proposed special revenue sharing which is referred to in several instances in the departmental budget for HUD indicates that fiscal 1974 will in effect see no special revenue sharing program and that the announcements of around January 8 indicated that many of these programs would be terminated as of June 30, so there is a period of hiatus there of 1 year. Now it is being asserted that some of these programs contain ongoing available authority and obligational levels which would permit operating at a somewhat considerably lower level than we have been accustomed or need, but we question whether that will provide anything like a need to meet the national level, to meet the national needs. If experience with general revenue sharing can be shown as any parallel, the mayors and governors and lots of groups were promised, I suppose is a good word, promised that general revenue sharing would not be used to supplant categorical grant programs and yet in dealing with Federal agencies and offices the membership of various organizations in this coalition have come to expect that those offices of the Federal Government will suggest to local government and to private agencies that general revenue sharing money can now be used for these purposes.

What I am saying to you is that at least from the experience of general revenue sharing so far the trade offs would seem to those at State and local levels and to private groups relying on those programs that they are losing more than they might get by a substantial amount and promises have in fact been broken.

Senator CHILES. I see.

Mr. EDMISTEN. Have any of you gentlemen ever consulted with anybody at OMB about this? If so, what has been their response?

Mr. MAFFIN. I personally have not consulted with OMB directly. I know in the case of operating subsidies, for example, for lowincome housing, that the general response has been that we must find a way to close off open ended obligational authority and moreover that these programs in our opinion have been poorly administered and in many cases ill conceived. We need time frankly to reexamine those programs and come up with alternatives.

Now those of us in this coalition are probably as acutely aware as anyone in this country of whatever shortcomings there may be in some of the programs Congress has enacted. These shortcomings have in part become more prominent because the programs are now being asked to do things they were never designed to do.

But we are also mindful of the fact that 4 years may well not be time enough to devise alternatives and other than the consolidating and codifying of housing programs there have been no alternatives proposed.

Senator CHILES. Thank you very much, we appreciate your testimony and your appearance.

Mr. MAFFIN. Thank you, sir.

(Statements of Robert W. Maffin and Rev. Robert E. Johnson follow :)

PREPARED STATEMENT BY ROBERT W. MAFFIN, CHAIRMAN OF THE NATIONAL AD HOC HOUSING COALITION

Mr. Chairman and distinguished members of the Separation of Powers Subcommittee, my name is Robert W. Maffin, and I am Chairman of the National Ad Hoc Housing Coalition and Executive Director of the National Association of Housing and Redevelopment Officials (NAHRO). Accompanying me today are James P. Twomey, Vice Chairman of the national coalition and Executive Vice President of the Nonprofit Housing Center, Inc.; James H. Harvey, SecretaryTreasurer of the national coalition and Chairman of the Housing Task Force, of the Leadership Conference on Civil Rights; John Evans, Director of the Department of Urban Affairs, of the AFL-CIO; the Reverend Robert E. Johnson, Chairman of the Interreligious Coalition for Housing; John Thompson representing the National Association of Real Estate Brokers, Inc.; and Timothy D. Naegele, General Counsel of the national coalition.

We appreciate this opportunity to testify in support of Senate Bill 373, the Impoundment Control Bill, which was introduced on January 16, 1973 by Chairman Ervin and forty-four other Senators to insure the separation of federal powers. It is our understanding that the sponsors of this legislation now number fifty-one and we hope this list will grow even more in the weeks to come.

THE COALITION

The National Ad Hoc Housing Coalition was formed earlier this year by some 70 organizations (see Attachment 1) representing the elderly, organized labor, banking and financial interests, churches, middle-income families, poor people, tenants, landlords, minority groups, public officials, rural interests, and others— all committed to honoring this nation's federal commitment to a decent home and a suitable living environment for every American family. Our immediate goals are to achieve a roll-back of the moratorium on new federal housing commitments which began on January 5, 1973, and to obtain the release of authorized and approved funds to meet pressing housing needs. Our long-term aims include the refinement of existing programs where such refinements are necessary; the fashioning of workable alternatives, where such alternatives are justified to fulfill this nation's federal commitment to housing; and the restatement of federal responsibilities in this area of domestic concern, to insure that urgent needs are adequately addressed. In all cases, we intend to work closely with the committees of Congress which are responsible for this legislation, and provide whatever assistance may be necessary.

In addition to the groups previously enumerated, we also speak on behalf of local coalitions which are springing up all over this country, patterned after the national coalition, in such states as California, Illinois, Massachusetts, Michigan, New Jersey, New York, Ohio, Pennsylvania, Utah and West Virginia. We are here today because of our concerns over what has taken place in recent months, not only in the field of housing but in other important areas, as well. We want to point out the problems which have been created in the process and describe what we feel will happen unless present trends are reversed.

EFFECTS OF MORATORIUM

On January 5, 1973, the Administration took decisive action to terminate the following programs: college housing, model cities, neighborhood facilities, open space land, water and sewer facilities, urban renewal, rehabilitation loans, public facility loans, community development training and fellowships, and supplementary grants for new communities. In addition, it suspended the assisted housing programs which include rent supplements, the Section 235 and Section 236 programs, and public housing; the housing programs of the Farmers Home Administration; nonprofit sponsor assistance; and the public housing modernization program.

These drastic measures, in the face of unmet demands for decent, low-cost housing-in urban and rural areas alike evidence a lack of concern and understanding on the part of administration officials which has broad implications for

other vital national programs, as well. In essence, the administration has rejected congressionally enacted housing programs and has said that all new housing activity will be halted, while a "period of searching evaluation" is completed and a nation's housing needs go unmet.

Iimpounded funds in the fields of housing and community development, during fiscal year (FY) 1973, will amount to $991 million and constitute approximately 16 percent of the Department of Housing and Urban Development's total available budget authority. In FY 1974, impoundments will exceed $1 billion and rise to at least 21 percent of total HUD funds available for new commitments. Almost $400 million of the total monies which will be impounded in FY 1974involving some 450,500 housing units for lower income families- relates to the Section 235 home ownership program, and the Section 236 rental assistance program.

It has been estimated that the economic impact of impounding funds for these two programs alone will exceed $19 billion and result in an estimated loss of 2.2 million man-years of employment (See Attachment 2). These figures are staggering; however, it must be realized that they do not include an assessment of the economic or employment impact relating to the impoundment of funds for rent supplements, water and sewer facilities, rehabilitation loans, college housing, nonprofit sponsor assistance, public housing modernization, model cities, neighborhood facilities, urban renewal, community development training and fellowships, supplementary grants for new communities, open space land, or public facility loans. The impoundment of funds in the latter areas of activity far exceeds the level for the two programs mentioned above; and therefore the moratorium's total impact on our economy in terms of dollars and jobs lost will be multiples of the $19 billion cost figure and the 2.2 million job figure.

The recent housing moratorium's consequences become even more apparent when one realizes that the level of new commitments for HUD-assisted housing programs will drop from 426,924 units in the FY 1972 to 29,800 units in FY 1974a reduction of 93 percent in new activity. At the same time, requested appropriations for the Department of Housing and Urban Development will drop from $4,291,508,000 in FY 1973 to an estimated $2,684,303,000 in FY 1974. Rural America's potential loss in dollars over the next 18 months is equally staggering: nearly $1.6 billion. But, dollars tell only part of the story; potential employment losses are estimated at 133,120 man-years.

It is also important to note that by the end of FY 1974, the January 5th moratorium on new commitments (when coupled with an already diminished pace of new activity) will place HUD-assisted housing programs 45 per cent behind goals set forth in the Housing and Urban Development Act of 1968 (See Attachment 3). Thus, by the end of that fiscal year-the sixth year of the ten year period during which six million new or rehabilitated units were to have been produced for low and moderate income families-slightly over half of the three million units anticipated will actually be ready. The most serious gaps exist in the public housing program where existing activity will lag 55 per cent behind projected goals; and the rent supplement program where the lag approaches 72 per cent. Both of these programs, interestingly enough, were designed to serve the lowest income families. It must also be emphasized that only four years remain to make up these deficits, if this nation sincerely hopes to honor its commitment to a decent home and a suitable living environment for every American family.

As a result of the moratorium, builders, lenders and others who have cooperated in producing housing under these programs will turn their efforts and investments in other directions. Substantial numbers of workmen and contractors, many of them members of minority groups, will be forced to seek other employment. Vast public and private resources and skills will be lost and cannot be replaced easily in the event that new housing programs are initiated at some future date.

In addition, housing costs will be left almost exclusively in the control of a very imperfect market. Average costs for both single-family and multifamily units may rise and the impact produced by the absence of lower priced housing will remain with the nation for many years. Rents on conventional apartments may also rise faster than if they had been constrained by the competitive effects of

additional subsidized rental projects. Rehabilitation of existing housing in many neighborhoods can also be expected to grind to a virtual standstill in the absence of sudsidy funds. The revitalization of salvageable inner-city neighborhoods which might have occurred with large-scale rehabilitation or clearance will not take place.

In short, the effect on substantial sectors of our economy will be disastrous; however, the foregoing analysis does not begin to describe the costs in human terms. It is important, therefore, that the hopes and aspirations of vast numbers of elderly persons, workers, homeowners, and others are not dashed beneath the pens of socially disinterested budget cutters. With the committee's permission, at this point in the record we would like to introduce concrete examples of the housing moratorium's impact on various areas of the country.

CONSTITUTIONAL CRISIS

It is clear from the information set forth above that a constitutional crisis of staggering proportions is indeed at hand. This crisis becomes even more apparent when one considers the impoundment of funds in other areas of domestic concern. Similar social needs affected by the impoundment process include welfare for those low-income and elderly persons who are desperately in need of timely assistance; education and manpower training programs for those who have been socially disadvantaged and who have only recently been given the hope and opportunity to better themselves; water pollution treatment funds; highway funds; assistance programs for farmers; and other domestic programs which can foster improved conditions in our cities, rural areas and our environment generally, and eliminate those conditions which contribute to crime and despair.

We believe that S. 373 and the goals which it seeks to achieve are extremely important at this point in America's history. The Administration is asserting the power to impound authorized and appropriated funds where such action makes impossible the fulfillment of domestic programs that Congress has enacted into law. Other Administrations have certainly frustrated programs, but never under claim of right to do so. It is undoubtedly true that a major portion of responsibility for the existence of the present impoundment crisis rests with Congress. In many instances, Congress has enacted statutes which leave open to the Executive Branch entire areas of discretion not policed by carefully drawn standards; incautious drafting and reliance upon the good faith of an incumbent President are poor shields for a legislative program when the Executive is not sympathetic to the purpose and goals of the law.

To be sure, the very structure of constitutional government may be altered by the President's assertion of the power to impound. Practically speaking, the initiative for establishing national priorities is shifted from Congress to the President. By impounding the funds that Congress has approved, the President is in essence exercising the item veto which Presidents have often sought by legislation or Constitutional amendment, but have repeatedly been denied. Such a power clearly is prohibited by the Constitution which empowers the President to veto entire bills only. The lack of constitutional authority for the President to act in the area of impoundment was recognized as recently as December 19, 1969, when then Assistant Attorney General William H. Rehnquist advised that "With respect to the suggestion that the President has a constitutional power to decline to spend appropriated funds, we must conclude that existence of such a broad power is supported by neither reason nor precedent."

DRASTIC ACTION TAKEN, BUT NO SOLUTIONS OFFERED

In the fields of housing and community development, there is also reason to be concerned about the manner in which the Administration has chosen to alter drastically longstanding national housing policies and programs. Neither Congress, interested public and private groups, elected government officials, organized labor nor housing consumers in general were consulted in the process.

While a full four years were required to alter this nation's course of action in Southeast Asia, our nation's housing policies were drastically altered overnight without the benefit of careful or systematic study. Furthermore, con

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structive and workable alternatives have not been forthcoming from the Administration to refine or replace existing programs.

It is no solution to say that the private conventional housing market has demonstrated its basic capacity to meet this nation's housing needs, when vast numbers of low and moderate-income families desire but cannot obtain decent shelter within their means. It is no solution to institute a holding action on new commitments for water and sewer grants, open space grants, and public facility loans until these activities are folded into Special Revenue Sharing; this constitutes Executive Branch coercion of Congress, the needy and the public-at-large. It is no solution to speak of the current pipeline of approved applications as assuring a substantial level of production well into the future, for the pipeline has been allowed to shrivel up for months and, indeed, may drop up completely before national needs are met, if the moratorium is allowed to remain in effect. We too believe there is room for improvement; and that present programs must be refined further to insure that scattered abuses do not persist and color public thinking on vital social needs. We do not believe, however, that the American people gave the President a mandate last November to terminate federal housing programs; nor do we believe that the impoundment process should be used to frustrate effectively the will of Congress, as expressed in some thirty years of housing laws.

SENATE BILL 373

It is for these reasons that we testify before this distinguished subcommittee today. We have reviewed Senate Bill 373 and commend the Chairman of this subcommittee for his leadership on this matter and for his continuing dedication to the Constitutional processes. While we stand ready to support Senate Bill 373 as presently drafted, we respectively urge that consideration be given to the elimination of a 60-day "grace period" for Presidential impoundments. It appears to us that Congressional approval should be obtained by the President prior to any impoundment of funds for domestic programs; however, we would defer to the Chairman's thinking on this matter. We also respectfully urge that the Bill be amended to specifically cover the impoundment of funds by any cabinet officer, the Director of the Office of Management and Budget (OMB), and any other federal employee; and to specifically cover the withholding of subsidized housing funds, as well. As presently drafted, there is some question as to whether these individuals and programs are covered. We know that a great deal of time and effort has already gone into the preparation of this Bill; and, therefore, we offer these comments merely as suggestions, in the event that further refinements are made by the committee.

Finally, we concur wholeheartedly with the statements made by Chairman Ervin on the Senate floor when S. 373 was introduced, to the effect that the impoundment of funds does not constitute a cure for our nation's fiscal or economic woes. We too believe that impoundment does not save anybody any money, nor does it lead to lower taxes. As Chairman Ervin stated, "It is merely a means whereby the White House can give effect to the social goals of its own choosing by reallocating national resources in contravention of congressional dictates." In conclusion, we call upon Congress to reassert control over its own programs. This Administration and previous Administrations have sought to influence these programs while under consideration by Congress and, in many instances, they were successful in their efforts. Now, the present Administration is seeking to undo years of cooperation between Congress, private interest groups and consumers alike, by ignoring Congressional directives in the process. Such actions have grave implications for our country as a whole, and therefore, we earnestly hope that this subcommittee and other committees of Congress will see fit to alter the course of events before permanent inroads are made in our constitutional process.

Mr. Chairman, we thank you for the time which you have afforded us today and commend you for your efforts. We are prepared to respond to any and all questions, in the time remaining. We are also prepared to provide this committee with any additional information which might prove helpful to your deliberations.

[Attachment I]