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As to the time lag. Federal spending programs are presently, and quite properly, allocated on a functional basis that is, balancing needs against resources. However, it seems to me that if Government spending programs are also to be used to combat the destructive effects of recession, as the Employment Act of 1946 apparently intended them to, then we must set up a triggering mechanism in advance to accelerate Government spending at the time when it will do the most good. I believe that this bill which you have before you now would accomplish that aim.

By the time we exhaust our present procedures of introducing new legislation, holding hearings and gaining congressional approval, and then go through the equally long process of setting the administrative machinery in motion, the period where stepped-up public works can be effective in arresting a recession will long have passed.

Equally important too is the planning lag. To be truly effective, a public works program must be geared to get work started quickly on projects which can be completed within a reasonably short period of time. The most ready source of such public works is the great backlog of needed capital improvement projects which exist in every municipality of the Nation. State and local governments have presently programed a huge backlog of $25 billion vitally nedeed public improvements; about $10 billion of this amount are State projects and $15 billion are local projects. These are exactly the type of projects which can most readily be accelerated, but only if the proper advance planning takes place.

For this reason I prefer the provision in Congressman Blatnik's H.R. 10113, calling for the establishment of an Office of Public Works Coordination and Acceleration. This does not appear in H.R. 10318. It seems to me that if you don't centralize this type of coordination and planning in one place, but merely leave it up to each of the various Departments and agencies of the Federal Government to do it on their own as far as their own programs are concerned, you don't get the kind of advanced analysis and planning that is necessary. There would be no way of knowing how the various Federal programs relate to each other, how they individually and totally relate to State and municipal programs, and what legal, financial and statutory conflicts on the Federal, State, and local levels would thwart your efforts to get these program into effect quickly.

It seems to me further that a very important part of the job of such an office would be to keep up-to-date records on State and local projects which might be accelerated, and to work with the States and local governments to have State and local laws changed, where necessary, to make it possible to fit into a Federal program.

Finally, and perhaps most importantly, there is the financial gap. The legislation you are considering very wisely contains three principal elements: First, it provides for the accelerating of existing Federal programs; second, it provides for Federal loans to municipaliites and other local public bodies which otherwise would be unable to finance their required share of the cost of projects; and, third, it provides grants to localities to finance capital improvement projects which are not presently eligible for grants. All of these elements relate to each other, and all are required to make the program effective.

Let me cite Philadelphia as a typical example of the situation which exists in many communities. Employment in Philadelphia would not be helped very much if the Federal Government were merely to accelerate the rate of expenditure of existing programs such as highways, airports, water pollution, urban renewal, and so forth. The reason is that we at the local level have no way of raising the required increase in local matching funds in such a short period of time. Then, again, it would vitally affect our tax structure, to which we are already committed.

Like most cities, we operate on a fixed capital budget which must be geared exactly to our tax structure, and this in turn is limited by State-imposed debt limitations.

It does no good to merely increase the rate of expenditure of the Federal highway, airport, or urban renewal programs which appear in our capital budget, unless some way is provided for us to acquire the local matching funds required.

The present legislation comes to grips with this problem in two ways. One is to permit the Federal Government to lend us the money to meet our local share. This would enable us to undertake sooner the capital works programs planned for later years and accomplish them at a time when they will have the greatest impact on unemployment and our economy.

Most important, however, is the provision which permits grants of 50 percent for projects not otherwise entitled to Federal grants. As you undoubtedly know, the capital projects of a city include many locally financed necessities in addition to highways, airports, and urban renewal projects which are entitled to Federal grants. These locally supported facilities include recreation centers, police and fire buildings, libraries, health centers, local street improvements, sewage plants and sewage lines, waterlines, and similar facilities.

If we can receive Federal grants for such local projects it will enable us to increase employment rapidly, either by doubling in 1 year the amount we spend for them or else by reallocating funds we had earmarked for such purposes so as to increase our local share of Federal matching funds.

In order to determine exactly how this program might operate insofar as the city of Philadelphia is concerned, I asked my various operating departments to submit to me a list of major capital projects over and above those scheduled for the 1962 capital budget which could be initiated and completed within 1 or 2 years. I have listed them at the end of my statement.

I have submitted a breakdown of some $42 to $45 million to this committee, all of which is set forth, and it is not necessary for me to go into it specifically at this time. All of the arguments I have already submitted apply with equal force to the administration amendment offered by Congressman Blatnik, and by our own Senator Clark, in the Senate, to authorize the immediate expenditure over the next 2 years of $600 million for public works.

The city of Philadelphia, for instance, is a class D surplus labor market, and would, therefore, be eligible to participate in the program, I assume. However, I should like to call attention to what I believe to be an inequity in these programs which are tied to labor market categories, insofar as our larger cities are concerned. Let me cite Philadelphia as an example.

Philadelphia has a current rate of unemployment of 10.4 percent. However, Philadelphia, like most core cities of large metropolitan areas, is ringed with rich suburban areas largely populated by skilled white-collar workers and managerial personnel. These suburbs are included in the same labor market with us with the result that our percentage of unemployment for the whole labor market is 7.1 percent. The same thing applies to many cities of the Nation.

Let me more specific. In Philadelphia, we have $42.7 million worth of major capital projects which could be initiated and completed in 1 year. If stretched out to 2 years, the cost would be an additional $300 million annually, because of the spiraling increase in supplies and labor.

None of these items are presently scheduled in our 1962 capital budget, for the simple reason that we do not have the required funds. We are presently spending just under $25 million alone of the taxsupported ceiling in our local economy. Nevertheless, they are all necessary to the health and welfare of our citizens. They include a new incinerator, a new health center and laboratory, a new rapid transit line to serve a community of 10,000 homes, sanitary and storm and flood relief sewers, parks and playground facilities, traffic signals, and street lighting.

It seems to me that the standby public works authority which this legislation would authorize in conjunction with the manpower retraining legislation you have already approved, would go a long way toward alleviating the longstanding unemployment problem which has plagued Philadelphia and many other local governments.

There has been some discussion whether tax cuts or public works would be more effective in achieving this goal. Tax cuts may increase the demand for consumer goods, and thus may ultimately increase employment, but they offer no immediate help to the unemployed, who do not have any taxable income anyhow.

Public works, on the other hand, can put meat and milk on the tables of the unemployed now.

The greatest argument against public works has been that they can't be started quickly enough to be effective. If this legislation is enacted, that argument will no longer apply.

Gentlemen, I appreciate the courtesy extended to myself, to the American Municipal Association, and to the great city of Philadelphia, and, of course, to the great State of Pennsylvania. It has been a pleasure to be with you.

Are there any questions?

Mr. BLATNIK. Mr. Mayor, again I want to express our appreciation for your appearance and for the very sound, factual statement based on practical experience. The Chair is particularly encouraged by your emphasis on the need for advanced planning, and having projects on the shelf, particularly smaller ones that can be gotten underway quickly. We are all familiar with the spectacle of the homeowner who has a leak in the roof in a thunderstorm. They vow every time to fix that leak as soon as the storm is over, but when good weather arrives we have a tendency to forget about it. We can have good, sound, justified, and badly needed projects that would contribute to the upgrading of the cities and civic communities, and provide service for years to come, and at the same time be paying men and women

to work just as we now pay many men and women who do not work through our unemployment compensation and through the relief rolls of towns and municipalities.

Are there any questions on my right? Any questions on my left? Mr. SCHWENGEL. Mr. Chairman.

Mr. BLATNIK. Mr. Schwengel.

Mr. SCHWENGEL. Mayor, I commend you for your statement. I followed it with interest. It is a very fine statement, I think, representing the American Municipal Association.

I want to say to you, before I make another observation, that I have a great interest in American history, and I have been in your town many, many times. Last year I spent 2 full days there touring the city, and, with the help of a very efficient and genial guide furnished by the chamber of commerce, whose name I am sure you would know, I saw some of the plans that the chamber of commerce had for the future development of your city.

It envisions, for the most part, leadership at the local level. You have evolved some tremendous plans for downtown commercial development in your city. I was thrilled beyond description to note the redevelopment of the Independence Hall.

Mayor TATE. Yes.

Mr. SCHWENGEL. And I was amazed that you didn't even refer to it in your talk. It is one of the most important developments, so far as the Nation is concerned, and it must be one of the most important developments so far as the local community is concerned. It is a project of which you ought to be justly proud. I was so thrilled with it when I came home loaded with facts and experiences that it inspired me to make a speech on the House floor, and I think you know about it.

Mayor TATE. Which we appreciated.

Mr. SCHWENGEL. And I spoke of the ambition I have for that development.

It occurred to me some of the programs you have testified for here may put that program in jeopardy. I think this would be a great shame. You need to acquire property down there to develop an information center comparable to the one they have at Williamsburg, which is a tremendous development and a very worthwhile project. I stand ready and willing to help you all I can to do that job, and to bring that to fruition.

The recent plans revealed by Mr. Anderson, whom I am sure you know, who works for the Interior Department, and who is a fine, able and devoted public servant, to restore the Franklin Home, which was covered up in the middle of a street, as you know, was a great idea. I introduced a bill to acquire the property where Jefferson lived when he wrote the Declaration of Independence, which I think is one of the greatest political documents and one of the most liberal papers ever written, and something we should never lose track of. This was born in your city

Also, near your city you have Valley Forge. It seems to me that this redevelopment program would help business tremendously in your community, and, more importantly, would make America and especially the youth of America acquainted with some of our glorious history, without which we cannot have the kind of patriotism and citizen

ship that we need, not only as we contend with the problems of today, but as we make plans for the future of this great country.

I hope you people there are not losing sight of that project and that you will never be identified with anything that will hamper that in any way, and that you will redouble your efforts to bring that to fruition, and thereby increase the traffic into your community, which would increase the traffic into this community and all the areas where the great history of our country was made. It is so important for us to think about it today.

Mr. DOOLEY. Mr. Chairman.

Mr. BLATNIK. Mr. Dooley.

Mr. DOOLEY. Mr. Tate, as a former mayor I sympathize with your problems. I want to commend you on a very fine and forthright statement and ask you this question: Has there been any estimate made of the number of people who would be restored to employment if you were to have the optimum grants and loans of $42 million if this legislation were passed?

Mayor TATE. I don't know. I do not have those figures there. But I am sure it would help us substantially at our public works level, for the people who are employed in construction of buildings of this type.

Mr. DOOLEY. Thank you.

Mr. BLATNIK. Thank you very much, Mr. Tate. Again we wish to express our appreciation that you appeared before us on behalf of the American Municipal Association.

Mayor TATE. Thank you, Mr. Chairman.

I would simply like to reply to Congressman Schwengel's remark to the effect that in the city of Philadelphia we are very much aware of the historical background of our city, and I would be imposing my time on this committee if I were to speak at length of it. I am sure he is aware of the fact that I could do so, but I want him to know the thing we are trying to do is to do it quickly. It has taken us more than 17 years just to get underway in that great project of which you speak. With help of this kind, I am sure that we can do it more quickly. Thank you.

Mr. SCHWENGEL. I might say, I found here a marvelous example of community cooperation between the State and Federal Government in developing a project with a great idea. This kind of balance is something we ought to seek to emulate, but I am fearful that your testimony here in behalf of some of this legislation that I think is poorly thought out, may throw it out of balance.

Mayor TATE. We have no concern about that and we have real responsibility.

Mr. SCHWENGEL. And it would postpone the development of this project. We feel there are many other projects across this land which would serve the public interest and enhance our opportunities for growth and expansion if we can follow a procedure in a normal and sensible way, and in a fiscal sense strengthen our economy more than some of these measures.

Mayor TATE. Thank you, sir.
Mr. HARVEY. Mr. Chairman.
Mr. BLATNIK. Mr. Harvey.

Mr. HARVEY. First of all, let me apologize for being late, but may

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