Congresswoman Waters Addresses Public Housing Authorities Directors Association Legislative Forum

Congresswoman Maxine Waters (D-CA), Chairwoman of the Financial Services Subcommittee on Housing and Community Opportunity, delivered the following remarks today to the Public Housing Authorities Directors Association Legislative Forum at the L'Enfant Plaza Hotel:

"Thank you so much for inviting me to address you today at your Legislative Forum.  It is so important that you all came to Washington to send a strong message to Congress about the work you are doing, and the continued need for public and assisted housing in our communities.  Visits like the one you are on this week remind policymakers, particularly those that aren't on the Financial Services Committee or who might not otherwise give much thought to public housing, of the struggles both your agencies and your residents are going through. 

I'm also happy you're in Washington D.C. because I believe there are a lot of misperceptions about public housing right now, and I'm glad you're here to help correct them.  For example, because of the foreclosure crisis, there is the false impression that rental housing must be easier to afford than ever.  But the data doesn't suggest that's the case.  In fact, housing has become increasingly unaffordable for low-income renters since the start of the recession.

Housing Affordability Crisis

According to the Center for Budget and Policy Priorities, in 2009, 5.6 million households — or about 60 percent of all poor renter families — paid at least half of their income for rent and basic utilities. That's a 17 percent increase since HUD's last survey in 2007 and a devastating 45 percent increase since 2003.  Keep in mind that for a typical family, housing costs consume only about a quarter of income and the federal government considers housing unaffordable if it costs more than 30 percent of a household's income.

And in 2009, roughly 325,000 children lived at least part of the year in a homeless shelter, according to HUD data, an increase of 12 percent since 2007. Two to three times as many children were homeless if you count those living temporarily in hotels, doubled-up with other families, or on the street, according to separate data from the Department of Education.

There are two real causes of this problem – and I'm sure you all see this play out, firsthand, in your communities.  First, many poor households' incomes have fallen due to the unemployment crisis, making housing that much more unaffordable.  Second, the houses that have been foreclosed upon are not returning to the housing stock as rental housing, so prices aren't being driven down.  Though I secured $7 billion for the Neighborhood Stabilization Program to address this challenge, we need more funds to keep pace with the scale of the problem.

Fighting for Funding for Public and Assisted Housing

So to me, the need to fund our public and assisted housing programs has always been clear.  That's why I circulated a letter to the Appropriations Committee calling for $5 billion for the public housing capital and operating funds in fiscal year 2011. 

Unfortunately, the budget we received from the Administration was not as good for public housing as it could have been.  Though the Administration called for $4.8 billion for the public housing operating account, only about $2 billion was proposed for the public housing capital fund.

Now, we in the House pushed back against this, and the bill the House passed before our August recess ended up funding the capital fund at $2.5 billion, and the operating fund at $4.8 billion.

But make no mistake, fighting for this funding was a difficult process, and I had to push back against many Members – even those in my own caucus. For example, as many of you may have heard, I had to work hard to defeat an amendment to the House appropriations bill that would have eliminated the $50 million Resident Opportunity and Supportive Services (ROSS) program, 10,000 new vouchers for homeless veterans and $200 million for HOPE VI, among other things.

When I heard that this amendment was going to be offered, I quickly met with Chairman Frank and we mobilized Members to demonstrate just how devastating this amendment would be.  Fortunately, the Members who drafted the amendment withdrew it when we fully explained the real-world consequences of what they were proposing.

Unfortunately, attempts to cut these important programs are indicative of a mindset of many of my colleagues in Congress – a mindset that goes after our fragile social safety net during the greatest crisis since the Great Depression simply to look "tough" when it comes to the budget. 

Preserving and Transforming Rental Assistance (PETRA)

And I'm afraid that this mindset is becoming more and more prevalent.  For example, take the Preserving and Transforming Rental Assistance (PETRA) program proposed by HUD this year. 

While I am pleased that this Administration is actually thinking about the future of public housing, I'm afraid that this entire concept of leveraging and mortgaging is based on the premise that we've given up on trying to adequately fund the public housing capital account.  This is distressing, particularly given the solid track record for the vast majority of public housing authorities in spending the $4 billion in capital funds I fought for and secured under the stimulus bill (American Recovery and Reinvestment Act of 2009).  It seems that under PETRA, they have simply given up on trying to preserve our commitment as a nation to provide adequate appropriations to house our most vulnerable citizens.

Moreover, I am very concerned about what would happen to public housing under PETRA in the event of a bankruptcy or foreclosure. Right now we are in the middle of the worst foreclosure crisis this country has ever experienced. Many lenders made loans that simply weren't sustainable and homeowners subsequently defaulted on those loans. While the foreclosure of one home may be a tragedy, it is an event that only affects one family. The foreclosure of a public housing development would have a devastating impact for dozens—and in some cases—hundreds of families. 

Finally, I think it is important to maintain that there is value in public housing, particularly in the fact that it is "public" in the sense that its owners—housing authorities—are not profit driven. And public housing is very effective at serving the "hard to house" population—people who for one reason or another, can't navigate the private rental market. Allowing the private sector to enter may provide housing authorities with more capital, but for-profit actors will be looking for a profit. Neither this Congress nor this Administration should allow anyone to profit at the expense of public housing residents.

So put simply, I believe PETRA is just too much, too soon.  I think many questions remain unanswered, and I have yet to see precisely what the benefits or cost savings would be of combining the 12 or 13 separate rental assistance programs, when many were designed to serve distinct populations.  As I said during the May hearing of the Financial Services Committee, I believe we need to take the next few years to map out the best course of action.

While our Committee will continue to think about public housing financing proposals, we have acted on the Administration's proposal for Choice Neighborhoods, passing out my bill, H.R. 5814, in July.  The first Title of this bill establishes the Choice Neighborhoods Initiative, which would be the successor program to HOPE VI. 
Though I know we have disagreements about some of the provisions in Choice Neighborhoods, I think that the bill we passed out of Committee represents a good compromise and mirrors many of the changes we made in my HOPE VI reauthorization bill from the last Congress. 

In addition to increasing appropriations to $575 million, my bill would also preserve the original intent of HOPE VI – to preserve and revitalize public housing – by setting aside two-thirds of funds for public housing developments.

My Choice Neighborhoods bill would also allow public housing authorities to spend a greater percentage of their grants on supportive services, and would allow some spending on non-housing activities that build communities, without diluting the core function of HUD – to provide safe, decent and affordable housing.

Conclusion
 
So between our authorizing legislation, and trying to beat back the calls to cut our most important housing programs, we have had an ambitious housing agenda so far this Congress.

Now that Congress has returned from recess, I will continue to call attention to these problems and to offer solutions, even when it is unpopular, and even in the face of an opposition who questions the wisdom of our nation's commitment to the preservation of public housing.

Thank you so much for inviting me here today, and enjoy the rest of your conference."

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