Cranston Will Offer Bill to Provide More Affordable Housing

Flanked by bipartisan elected officials and leaders of the real estate and lending industries, Sen. Alan Cranston (D-Calif.) announced Thursday that he will seek major legislation to create affordable housing for the poor and middle class and fight the growth of homelessness.

Cranston, chairman of the Senate subcommittee on housing and urban affairs, speaking at the second day of public hearings in Los Angeles, said he hoped to introduce the bill in July.

He vowed to “make this an issue in the presidential race and get people committed to restoring the American dream of a good home in which to live.”

The centerpiece of the effort is a list of recommendations from the National Housing Task Force, a privately funded group of nationally known housing experts that began its work last year at the urging of Cranston and Sen. Alfonse M. D’Amato (R-New York).

On Wednesday, the task force released a report calling for a sweeping new national housing policy and $3 billion annually in federal funds to create a housing opportunity program.

The program would use federal funds in combination with state matching funds and creative financing techniques to construct and renovate housing for the poor and make home buying easier for first-time buyers, an attempt to halt the alarming downward spiral in the percent of middle-class and low-income families who are buying homes.

Cranston said the task force’s report, entitled “A Decent Place to Live,” is the “single most important policy paper on housing in the last 20 years, created by a total mix of experts with hands-on knowledge of housing who were not asked first whether they were Republican or Democrat.”

He said he expects bipartisan support for the broad ideas outlined by the task force but also anticipates “lively opposition” to many of the specific recommendations.

Views Echoed

Indeed, Rep. David Dreier (R-La Verne), who sat near Cranston Thursday, said that while he takes issue with the task force’s criticisms of the deep cuts in housing programs by the Reagan Administration, “I share your efforts for a comprehensive overhaul of the nation’s housing policy.”

On Wednesday, David O. Maxwell, chairman and chief executive of the Federal National Mortgage Assn.--known as Fannie Mae--told a packed audience that if a federal program is not created soon, the nation will pay later, “not just in dollars, but in almost incalculable social costs.”

Maxwell, who was co-chairman of the task force, said that half of all low-income renters nationwide now spend more than 50% of their incomes on rent. (Under federal guidelines, affordable housing is defined as no more than 30% of a family’s income.)

Moreover, he said, the nation’s rate of home ownership declined from 65.6% of all households in 1981 to 63.8% of all households in 1986--representing 2 million families who, in the past, would have been expected to purchase a home.

The two-day conference, organized by UCLA and industry groups, attracted dozens of housing industry power brokers, including Nathan Shapell, chairman of Shapell Industries Inc., Ira Gribin, president-elect of the National Assn. of Realtors, and Anthony Downs, senior fellow at the Brookings Institution in Washington.

Warning Sounded

Shapell, one of the largest housing developers on the West Coast, said that because of the increasing financial barriers to buying and renting housing, “soon only the wealthy will be able to buy houses, and the lower-income people will be forced to live with other families or in their cars. And this is not the future, this is happening now.”

Maxwell likened the housing crunch to a game of musical chairs, “with each chair shabbier than the one next to it. When the music stops, those who would normally buy a home grab the apartment chairs and those who would be renting comfortable apartments settle for substandard ones. The weakest and most helpless get no chair at all.”

Gribin said that because of the intertwined nature of problems facing both renters and home buyers, a new housing policy can only succeed if a partnership is formed between industries and agencies that want to help home buyers and those that want to help the poor and homeless.

Americans Chided

He cautioned, however, that Congress and individual state governments may not be ready to back such a costly program, because “Americans react to Pearl Harbors and Sputniks” and not to more subtle problems such as the growth of slums and loss of affordable housing.

In fact, one of the toughest battles for the program at the state level may be in Sacramento, where the Deukmejian Administration has vetoed more than 75% of the bills for housing.

As a result, California now spends only 48 cents per capita on housing, putting it near the bottom of the list nationally.