Housing Act of 1954

In 1953, the Eisenhower Advisory Committee on government housing policy and programs recommended that a broader program of urban renewal replace the narrow program of urban redevelopment that was found in the Housing Act of 1949. President Eisenhower supported the change, and one year later, the Housing Act of 1954 (O.L. 83-560) changed the program title of the Housing Act of 1949 from the Slum Clearance and Urban Redevelopment program to the Slum Clearance and Urban Renewal program. It followed President Eisenhower's proclamation, in a January 25, 1954, message to Congress, that “the national interest demands the elimination of slum conditions and the rehabilitation of declining neighborhoods.” With housing problems continuing to plague the United States with millions of people living in slums, it became national policy to clear [Page 335]slums and blighted areas and, ultimately, to eliminate the causes of slums and blight. After signing the act on August 2, 1954, President Eisenhower indicated that its passage would “raise the housing standards of our people, help our communities get rid of slums and improve their older neighborhood, and strengthen our mortgage credit system … strongly stimulate the nation's construction industry and our country's entire economy” (Peters & Woolley, n.d., “Dwight D. Eisenhower,” para. 1). It was now more than just a federal housing program. It stands as one of the most significant pieces of federal legislation ever passed that affected U.S. cities. It has also been controversial and criticized by some individuals for being a “people removal” program.

The new urban renewal program represented a more comprehensive tool that offered localities federal assistance for conservation and rehabilitation as well as assistance for slum clearance. The earlier “primarily residential” clause of the Housing Act of 1949 was broadened to allow urban sites to be developed for commercial and institutional developments, not just for housing. The previous requirement that cleared slum land had to be used for housing was strongly opposed by supporters of urban renewal.

To receive federal funding under the urban renewal program, localities were required to develop a “workable program.” The workable program had to contain the following requirements:

• 1.
  Adequate codes and ordinances—standards for construction and standards for housing
• 2.
  A comprehensive community plan for land use and public capital development that would include a land use plan, a thoroughfare plan, a community facilities plan, a public improvement program, a zoning ordinance and map, and subdivision regulations
• 3.
  Neighborhood analysis to show the existence and extent of blight
• 4.
  Administrative organization adequate to an all-out attack on slums and blight
• 5.
  Program for relocation of displaced families
• 6.
  Citizen participation
• 7.
  Adequate financial resources for accomplishing the aforementioned requirements

The Housing Act of 1954 authorized several mortgage insurance programs. The Section 220 program authorized a Federal Housing Administration mortgage insurance program for rehabilitation and neighborhood conservation housing insurance. It was designed to assist with the financing required for the rehabilitation of existing dwellings and the construction of new dwellings within urban renewal areas. The Section 221(d)(2) program offered mortgage insurance to increase homeownership opportunities for low- and moderate-income families, especially those displaced by urban renewal. The Section 221(d)(3) and Section 221(d)(4) programs provided mortgage insurance for low- and moderate-income families and for families displaced as a result of urban renewal activities. The 221(d)(3) program offered 100% mortgage insurance for nonprofit developers and 90% for profit-oriented developers. The 221(d)(4) program provided mortgage insurance for profit-oriented developers for moderate-income projects.

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