Rep. Waters Speaks On Public Housing Asset Management Improvement Act of 2007
I think we can all agree that public housing agencies can be better at managing our public housing resources and that asset management has the potential to improve how public housing is managed nationwide. However, in examining the issues behind the implementation of asset management, it has become clear that HUD's one-size-fits-all approach simply won't work. In addition, the Department's willful disregard of existing statute as a part of the i mplementation is eroding the trust of housing agencies' residents and some Members of this Congress.
In light of the Department's actions and the need to proceed with asset management, my friend from New Jersey who introduced this bill, H.R. 3521, maintains and respects the negotiated rulemaking agreed to by all parties, housing agencies, their industry representatives and HUD and still requires housing agencies to convert to asset management by 2011.
However, the bill settles three outstanding issu es that have slowed the implementation of asset management: number one, the amount of management fees; number two, the ability of housing agencies to use a portion of their capital funds while operating expenses as allowed under statute; and number three, the kind of housing agencies that must convert to asset management. These are all critical issues that must be decided before 2011.
H.R. 3521 would require negotiated rulemaking to settle the issue of management fees. The fees that the Department is at tempting to impose on housing agencies are, in many cases, insufficient and will not meet the needs of housing agencies that have been historically underfunded.
In addition, these fees appear to have been arrived at in an arbitrary manner. Negotiated rulemaking on the subject of management fees would allow the Nation's housing managers to work with HUD to determine a reasonable fee for managing public housing. Because the date for full implementation of asset management would stay the same, negotiated r ulemaking would not delay or stall conversion to asset management.
On the use of capital funds for operating expenses, the statute is very clear. Housing agencies have the ability to move 20 percent of their capital funds to their operating fund. However, in its guidance, the Department has disregarded this plain-as-day statute and has limited capital fund fungibility to 10 percent. The bill simply asserts what is already in law.
Large housing agencies will benefit the most from asset management due to the economies of scale that will result from streamlining their operations. By raising the threshold for conversion from housing agencies that manage 250 units to those that manage 500 units, the bill simply ensures that only those housing agencies with the ability to benefit from asset management are required to comply with it.
Furthermore, the bill makes sure that asset management does not stifle tenant participation and resident organization. Public housing residents are very concerned about how asset management will impact their ability to participate and to organize. The bill ensures that the ability of residents to remain involved and to be represented is not impinged upon.
Mr. Chairman, this bill does not undo, reverse, or undermine the original negotiated rulemaking between housing agencies and the Department. It simply settles four outstanding issues so that asset management can move forward.
###