Dwight D. Eisenhower photo

Veto of the Second Housing and Urban Renewal Bill.

September 04, 1959

To the Senate of the United States:

I return herewith, without my approval, S. 2539, "An Act to extend and amend laws relating to the provision and improvement of housing and the renewal of urban communities, and for other purposes."

On July 7, I returned an earlier housing bill, S. 57, to the Senate and set forth in an accompanying message of disapproval many of that bill's objectionable features. Although some of these features have been removed in S. 2539, and some partially corrected, in its most important provisions S. 2539 represents little over-all improvement over S. 57. In one respect--the setting of an expiration date next fall on the new loan insurance authorization of the Federal Housing Administration, with potentially serious disruptive effects on the building industry--S. 2539 is worse than the earlier housing bill.

Clearly this bill, like its predecessor, goes too far. It calls for the spending of more than 1 3/4 billion of taxpayers' dollars for housing and related programs over and above the vast expenditures to which the Federal government is already committed for these purposes. The history of the bill indicates that the Congress intends it to be a one-year bill. So regarded, S. 2539 calls for Federal spending at virtually the same rate as that provided for by S. 57--a rate far in excess of my recommendations to the Congress.

At a time when critical national needs heavily burden Federal finances, this bill would start two new programs, certain to cost huge sums in the future, under which taxpayers' money would be loaned, at subsidized interest rates, for purposes that could be better met by other methods.

One of the new programs would have the Federal government make direct loans to colleges for classrooms and related facilities and equipment by methods that would tend to displace the investment of private funds in these projects. This is Federal aid to education in a highly objectionable form.

The other new program would have the Federal government make direct loans for housing for elderly persons despite the fact that a program is already in operation and working well, at no cost to the taxpayer, and under which private loans for this same purpose are guaranteed by the Federal government.

Among its other objectionable features, this bill would authorize 37,000 new units of public housing while many thousands of previously authorized units have not been completed or occupied. These, too, would be subsidized, on a basis that would cost the taxpayer many hundreds of millions of dollars over the next forty years. The bill would also authorize 650 million dollars of Federal grants to cities for urban renewal projects. This sum considerably exceeds the first-year amount recommended by the Administration for these purposes.

This is not the kind of housing legislation that is needed at this time. It does not help the housing industry for the Federal government to adopt methods that in these times would increase inflationary pressures in our economy and thereby discourage the thrift on which home financing is heavily dependent. Nor does it make sense to purport to assist any group of citizens, least of all elderly persons living on fixed retirement incomes, by legislation that tends further to increase the cost of living.

There is still time for the Congress to enact a sound housing bill, and I once again urge that it do so. These things can be and ought to be done: (1) remove the ceiling on FHA mortgage insurance authority; (2) extend the FHA program for insurance of property improvement loans; (3) enact reasonable authorizations for urban renewal grants and college housing loans and adjust the interest rate on the latter; (4) extend the voluntary home mortgage credit program; and (5) adjust the statutory interest rate ceilings governing mortgages insured under FHA's regular rental and cooperative housing programs.


Note: On September 23 the President approved S. 2654 "An Act to extend and amend laws relating to the provision and improvement of housing and renewal of urban communities, and for other purposes" (Public Law 86-372; 73 Stat. 654).

Dwight D. Eisenhower, Veto of the Second Housing and Urban Renewal Bill. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/234177

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