[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
AFFORDABLE HOUSING NEEDS IN
THE CITY OF HOUSTON: UNIQUE
CHALLENGES AND OPPORTUNITIES
=======================================================================
FIELD HEARING
BEFORE THE
SUBCOMMITTEE ON
HOUSING AND COMMUNITY OPPORTUNITY
OF THE
COMMITTEE ON FINANCIAL SERVICES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
OCTOBER 29, 2007
__________
Printed for the use of the Committee on Financial Services
Serial No. 110-76
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HOUSE COMMITTEE ON FINANCIAL SERVICES
BARNEY FRANK, Massachusetts, Chairman
PAUL E. KANJORSKI, Pennsylvania SPENCER BACHUS, Alabama
MAXINE WATERS, California RICHARD H. BAKER, Louisiana
CAROLYN B. MALONEY, New York DEBORAH PRYCE, Ohio
LUIS V. GUTIERREZ, Illinois MICHAEL N. CASTLE, Delaware
NYDIA M. VELAZQUEZ, New York PETER T. KING, New York
MELVIN L. WATT, North Carolina EDWARD R. ROYCE, California
GARY L. ACKERMAN, New York FRANK D. LUCAS, Oklahoma
JULIA CARSON, Indiana RON PAUL, Texas
BRAD SHERMAN, California STEVEN C. LaTOURETTE, Ohio
GREGORY W. MEEKS, New York DONALD A. MANZULLO, Illinois
DENNIS MOORE, Kansas WALTER B. JONES, Jr., North
MICHAEL E. CAPUANO, Massachusetts Carolina
RUBEN HINOJOSA, Texas JUDY BIGGERT, Illinois
WM. LACY CLAY, Missouri CHRISTOPHER SHAYS, Connecticut
CAROLYN McCARTHY, New York GARY G. MILLER, California
JOE BACA, California SHELLEY MOORE CAPITO, West
STEPHEN F. LYNCH, Massachusetts Virginia
BRAD MILLER, North Carolina TOM FEENEY, Florida
DAVID SCOTT, Georgia JEB HENSARLING, Texas
AL GREEN, Texas SCOTT GARRETT, New Jersey
EMANUEL CLEAVER, Missouri GINNY BROWN-WAITE, Florida
MELISSA L. BEAN, Illinois J. GRESHAM BARRETT, South Carolina
GWEN MOORE, Wisconsin, JIM GERLACH, Pennsylvania
LINCOLN DAVIS, Tennessee STEVAN PEARCE, New Mexico
ALBIO SIRES, New Jersey RANDY NEUGEBAUER, Texas
PAUL W. HODES, New Hampshire TOM PRICE, Georgia
KEITH ELLISON, Minnesota GEOFF DAVIS, Kentucky
RON KLEIN, Florida PATRICK T. McHENRY, North Carolina
TIM MAHONEY, Florida JOHN CAMPBELL, California
CHARLES A. WILSON, Ohio ADAM PUTNAM, Florida
ED PERLMUTTER, Colorado MICHELE BACHMANN, Minnesota
CHRISTOPHER S. MURPHY, Connecticut PETER J. ROSKAM, Illinois
JOE DONNELLY, Indiana THADDEUS G. McCOTTER, Michigan
ROBERT WEXLER, Florida KEVIN McCARTHY, California
JIM MARSHALL, Georgia
DAN BOREN, Oklahoma
Jeanne M. Roslanowick, Staff Director and Chief Counsel
Subcommittee on Housing and Community Opportunity
MAXINE WATERS, California, Chairwoman
NYDIA M. VELAZQUEZ, New York SHELLEY MOORE CAPITO, West
JULIA CARSON, Indiana Virginia
STEPHEN F. LYNCH, Massachusetts STEVAN PEARCE, New Mexico
EMANUEL CLEAVER, Missouri PETER T. KING, New York
AL GREEN, Texas CHRISTOPHER SHAYS, Connecticut
WM. LACY CLAY, Missouri GARY G. MILLER, California
CAROLYN B. MALONEY, New York SHELLEY MOORE CAPITO, West
GWEN MOORE, Wisconsin, Virginia
ALBIO SIRES, New Jersey SCOTT GARRETT, New Jersey
KEITH ELLISON, Minnesota RANDY NEUGEBAUER, Texas
CHARLES A. WILSON, Ohio GEOFF DAVIS, Kentucky
CHRISTOPHER S. MURPHY, Connecticut JOHN CAMPBELL, California
JOE DONNELLY, Indiana THADDEUS G. McCOTTER, Michigan
BARNEY FRANK, Massachusetts KEVIN McCARTHY, California
C O N T E N T S
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Page
Hearing held on:
October 29, 2007............................................. 1
Appendix:
October 29, 2007............................................. 43
WITNESSES
Monday, October 29, 2007
Allison, Horace, Senior Vice President, Housing Authority of the
City of Houston................................................ 14
Bustamante, Daniel, Executive Director, Greater Houston Fair
Housing Center................................................. 34
Celli, Richard S., Director, City of Houston Housing and
Community Development Department............................... 13
Gerber, Michael, Executive Director, Texas Department of Housing
and Community Affairs.......................................... 11
Henneberger, John, Co-Director, Texas Low Income Housing
Information Service............................................ 26
Junor, Debra, Member, Texas Tenants' Union....................... 31
McElroy, Toni, President, Texas ACORN............................ 33
Muhammad, Robert, Chief Executive Officer, ACTION Community
Development Corporation........................................ 29
Ozdinec, Milan, Deputy Assistant Secretary for Public Housing and
Voucher Programs, U.S. Department of Housing and Urban
Development.................................................... 9
Quan, Gordon, Founding Partner, Quan, Burdette and Perez, on
behalf of the National Coalition for Asian Pacific American
Community Development.......................................... 36
APPENDIX
Prepared statements:
Bustamante, Daniel........................................... 44
Celli, Richard S............................................. 57
Gerber, Michael.............................................. 60
Henneberger, John............................................ 71
Junor, Debra................................................. 93
Lopez, Manuel................................................ 101
McElroy, Toni................................................ 104
Muhammad, Robert............................................. 110
Ozdinec, Milan............................................... 114
AFFORDABLE HOUSING NEEDS IN
THE CITY OF HOUSTON: UNIQUE
CHALLENGES AND OPPORTUNITIES
----------
Monday, October 29, 2007
U.S. House of Representatives,
Subcommittee on Housing and
Community Opportunity,
Committee on Financial Services,
Washington, D.C.
The subcommittee met, pursuant to notice, at Houston
Baptist University, Belin Chapel, 7502 Fondren Road, Houston,
Texas, Hon. Maxine Waters [chairwoman of the subcommittee]
presiding.
Members present: Representatives Waters and Green.
Also present: Representative Jackson Lee.
Chairwoman Waters. Good morning, ladies and gentlemen. I'd
like to start by thanking President Robert Sloan and the
Houston Baptist University for allowing us to use this
wonderful space for today's hearing on ``Affordable Housing
Needs in the City of Houston: Unique Challenges and
Opportunities.'' It's a beautiful campus. This is a beautiful
auditorium. And let's just give the president a round of
applause to thank him. Where are you, President Sloan? There he
is, in the back. Thank you so very, very much.
Mr. Sloan. Thank you.
Chairwoman Waters. I'd also like to thank Congressman Al
Green for inviting me here today. And upon learning about this
hearing that was being held by the subcommittee that I chair
and where Mr. Green serves, your other Congressperson of the
area, Ms. Sheila Jackson Lee, said, ``I would like to
participate.'' Let's thank her for being here.
I'm very pleased to hold today's hearing for several
reasons. First, as I said, Representative Green asked me to.
And whenever he makes a request, I do my best to comply. That
is because Representative Green is simply the most committed
member of my subcommittee. We have many scheduling commitments
as Members of Congress. Representative Green, for example,
serves on the critical Homeland Security Committee as well as
facing the demands of the full Financial Services Committee
which has been extraordinarily active this season due to recent
events in the economy and the leadership of our chairman,
Chairman Barney Frank. Yet as we prepared for this hearing, my
staff confirmed what I had already suspected, namely that Mr.
Green is the only member of the subcommittee to have attended
every single one of our hearings this session. He has perfect
attendance.
Mr. Green. Thank you.
Chairwoman Waters. And he deserves much more than just a
gold star for attendance. Representative Green is a consistent
voice for the poorest, most vulnerable residents of Houston,
Harris County, and the Nation when it comes to Federal housing
policy decisions, whether they take place within our
subcommittee, at the full committee level, or even on the Floor
of the House itself. In the subcommittee, I can always count on
him. Indeed, he ably stepped in for me as chair recently when
my own multiple committee assignments forced me to miss a
portion of one of our subcommittee's hearings on homelessness.
At the full committee, during consideration of our Section 8
voucher reform bill, Representative Green offered a successful
amendment to authorize desperately needed additional housing
vouchers in recognition that we need to do more than just
improve existing Federal housing programs. We need to expand
them after many, many years of neglect. Finally, earlier this
month, Representative Green spoke eloquently on the House Floor
in support of the National Affordable Housing Trust Fund Act,
whose passage by the full House stands as perhaps our
committee's proudest accomplishment this year.
Representative Green is also an innovative legislator in
his own right. I look forward to hearing from all of the
witnesses today about the potential impact of a bill that he
has introduced, H.R. 2629, the Housing Fairness Act of 2007,
which would reinvigorate the Department of Housing and Urban
Development's enforcement of the Nation's fair housing laws. He
is also the lead sponsor of H.R. 3329, the Homes for Heroes
Act, which would devote substantial new resources to the
housing and supportive services needs of America's veterans, an
absolute necessity in these times, as we all know.
Now, before I highlight additional reasons why this hearing
is so timely and appropriate, I would like to acknowledge
Representative Jackson Lee. While I do not have her serving on
the Housing Subcommittee, she has many accomplishments that she
can be proud of, because in addition to the work that she does
on the Judiciary Committee--where I serve with her--she is
serving on three of the most influential committees in the
Congress of the United States. Again, in addition to the
Judiciary Committee, she is on the Homeland Security Committee
and the Foreign Affairs Committee. So I'm very pleased that
she's been able to join us today. And she has worked with
Representative Green as they have both been extraordinary
advocates on behalf of the victims of Hurricanes Katrina and
Rita and the housing of the Houston region which has been so
affected. They have both been staunch allies in the fight to
push for my legislation, H.R. 1227, which is known as the Gulf
Coast Hurricane Housing Recovery Act of 2007, through the
House.
Again, I'm pleased to hold this hearing because the
affordable housing needs in Houston are quite unique. As the
Nation's fourth largest city and one of the fastest growing,
Houston boasts one of the most diverse populations in the
Nation. As the title of the hearing suggests, Houston's
circumstances provide for both challenges and opportunities. On
one hand, as one who comes from Los Angeles where the median
home price is $529,000, the housing costs in Houston seem
downright reasonable. It is nearly $400,000 less than that to
purchase a median home here. I think the median here is about
what, Mr. Green, $156,000?
Mr. Green. $154,900.
Chairwoman Waters. $154,900. That seems awfully reasonable
to those of us who come from California. However, when we look
at the number of people who have very low incomes, and are just
barely making it, that can be very high. People are paying more
than 30 percent of that income for housing. These costs, as
well as flexible zoning environments, make development of
additional affordable housing here perhaps more feasible than
in some of the major metropolitan areas. On the other hand,
reasonable does not necessarily mean affordable, nor can
affordable housing be developed anywhere no matter the economic
and regulatory climate without the resources to do it.
Nearly one-third of Houston homeowners and over half of all
renters in the Houston metropolitan area again, as I indicated,
spend more than 30 percent of monthly pretax income on all
housing costs making them housing cost burdened as defined by
the Department of Housing and Urban Development. Fully a
quarter of renters pay more than 50 percent of their income in
rent unsustainable for households over the long term. And as in
every community in the country, working no longer guarantees
being able to afford housing in Houston. The National Low
Income Housing Coalition estimates that in order to afford a
reasonable two-bedroom apartment here, a renter would have to
earn $14.77 an hour, more than 2\1/2\ times the minimum wage.
Also, like most communities in the Nation, the Federal
housing resources available in Houston don't come close to
meeting the need. Across the country, only one out of four
households eligible for Federal housing assistance receive it.
Here, this manifests itself in waiting lists numbering in the
thousands for the Houston Housing Authority Section 8 vouchers
and public housing units. Houston's booming growth is now
threatened by the recent crisis in the subprime mortgage
market. The foreclosure rates here are not among the highest in
the Nation, but they are still significant. And this market
experienced double-digit drops in both home prices and housing
starts last month.
Added to these challenges, of course, is the continued
impact of Gulf Coast hurricanes. The nearly 200,000 evacuees
who initially came to Houston constituted the equivalent of the
entire City of Shreveport, one of the Nation's 100 largest
cities, suddenly being dropped in Houston's lap. Nearly half of
the evacuees remain here. The generosity shown by the City and
its residents has been extraordinary.
Representatives Green, Jackson Lee, and I have just had the
opportunity to observe some of the excellent work that has been
done here, but, of course, there have been bumps in the road
along with the successes. I'm sure that we will hear about both
today. I want to assure you that as chair of the Housing and
Community Opportunity Subcommittee, I am indeed committed to
helping Houston meet all of its affordable housing needs, both
those that existed before Hurricanes Katrina and Rita and
additional ones that have been created by the hurricanes.
Not only am I committed because of the wonderful advocacy
of Mr. Green and Ms. Lee and others, as you know, my husband is
from Houston. And so I have to honor him and his family also.
Not only do I have to work for Los Angeles and California, but
I have to work for Houston and Texas, also. So with that, I
want to recognize Representative Green for his opening
statement.
Mr. Green. Thank you, Madam Chairwoman. Friends, this is
indeed a great occasion, because today the Congress of the
United States of America via its Housing Subcommittee has
convened in Houston, Texas. It is historical. And I am so
honored, I cannot tell you what a preeminent privilege it is.
In fact, it is a superlative pleasure and a splendiferous honor
to be seated next to the Honorable Maxine Waters, the
preeminent authority. The preeminent authority, that's right.
Give her a big Texas-size welcome. If you love Maxine Waters
and you know it, you ought to stand up and show it. Give her
the kind of welcome that she merits for bringing this committee
to Houston, Texas. Give it to her.
Friends, in the United States Congress, the Congressional
Black Caucus, with its 43 members, is considered the conscience
of the United States Congress. I would have you know that the
Honorable Maxine Waters is considered the conscience of the
conscience of the United States Congress. Maxine Waters.
By way of some information that is of benefit to you that
will, of course, coincide with much of what we'll talk about
today, I need to share the following: There was an effort to
raise the minimum wage in this country. It took 10 years to get
it done. Throughout the entirety of the 10-year period, the
Honorable Maxine Waters was at the very forefront of that
movement. She was a part of the movement to raise the minimum
wage, and I say thank God that this Congress has now raised the
minimum wage to $5.85 an hour. It's not what it should be, but
thank God it isn't what it was. We have raised the minimum
wage.
It's important to talk about this minimum wage because,
when we talk about affordable housing, people who are among the
least, the last, and the lost need affordable housing too. And
they need to be able to have the dignity of earning an income
so that they can pay their own way. No one wants to be on
welfare. Every person wants to say farewell to welfare. A
decent day's wage for a decent day's work is a means by which
people can say farewell to welfare. She has been a part of that
effort to help people get that decent day's wage.
But more importantly--and as important as it is, I will say
more importantly, this Housing Trust Fund that she mentioned,
friends, it is unheard of in the annals of U.S. history to have
an Affordable Housing Trust Fund dedicated to the preservation
of affordable housing, to the construction of affordable
housing, to the renovation of affordable housing, dedicated to
maintaining a sufficient stock of affordable housing to meet
the needs of those in this country who do not have affordable
housing. This Affordable Housing Trust Fund will be funded with
money from the GSE, Fannie Mae and Freddie Mac, about $700
million annually, and money from FHA, about $300 million. This
is a significant number. We're talking about approximately $1
billion annually for affordable housing. And it is something
that we can thank the Honorable Maxine Waters for. I will also
tell you that I have been so blessed to serve on a committee
with her and to serve on a committee that is also under the
leadership of the Honorable Barney Frank. And when my
subcommittee chair and my full committee chair are working in
sync and harmony, if you will, it really makes it easy for us
to get some of the things done that you want to have us do. So
I'm very appreciative that she has come today and she is here
to hear from us and understand what our needs are here in
Houston, Texas, and we do have some needs.
I also want to say to you that I'm honored to have the
Honorable Sheila Jackson Lee here with us as well. She and I
are working together on a good number of projects, not only in
Congress but also here locally, that while they may not seem to
relate to the congressional effort, we are elected to help in
any way that we can, and we do so. And I ask that you give her
an expression of appreciation, as well.
Finally, before I give you just a bit of statistical
information--and I don't want to overwhelm you because we have
capable, confident, qualified experts who will impart this
information to you, but I do want say this finally before I go
to this information. When Katrina hit Louisiana, it was
necessary for Members of Congress to go there. I know of at
least five occasions wherein the Honorable Maxine Waters went.
But I want to tell you about one mall incident, just a brief
vignette, to give you some understanding of how she relates to
people.
We had a lady who wanted us to go and see how her home had
been flooded, and it was a consensus that we didn't have enough
time, that it was just really not available for us at that time
to do this. I want you to know that when she overheard that
conversation, she stepped up and said, ``We will go, we will
see, and we will hear.'' No one in her world is above the law,
and thank God in her world no one is beneath the law. Every
person merits consideration of the law.
With reference to my City of Houston, Texas, we define
affordable housing at the national level as spending no more
than 30 percent of your income, your gross income, on housing.
I regret to inform you that in our City, we have many persons
who are exceeding that and exceeding 50 percent, but also when
you add housing and transportation into the equation, we find
that the average family is spending about 56 percent of their
income on housing and transportation. Now, if you're spending
50 percent of your income on housing and transportation, that
doesn't leave a lot for the necessities of life other than
housing--clothing, food, and some of the other amenities that
you need to live, as well. So we're here today to hear from the
experts and ask that they would give us the insight that we
need so that we can go back to the Congress of the United
States and be efficacious in the effort to make sure that the
needs of all persons in this country are met with reference to
housing. Every person ought to have a place to call home. We
are here to meet these needs.
Finally, we have people who are homeless in Houston, Texas,
and the statistical information is quite shocking. For fear
that I may not recite it all absolutely correctly, I'd like to
just read to you some of this information: At any point in
Houston, Texas, we have about 12,000 to 14,000 people who are
experiencing homelessness. And in this group of people who are
experiencing homelessness, about 11 percent are there because
of domestic violence; about 24 percent are there because they
have been incarcerated and they are back trying to make their
way through life; about 28 percent of them are veterans; 55
percent have some mental health issues; 57 percent have had
some sort of history of substance abuse; 59 percent lost their
housing because they lost their job; and 66 percent have no
income at all. These numbers don't add up to 100 percent
because many of the persons will fall into multiple classes. We
have persons who have no jobs, who have substance abuse, who
may have some mental concerns that should be addressed.
So as we look to acquire our intelligence on housing, we
want to remember that we have the homeless, we have those who
are working and still cannot afford housing, and then, of
course, we have those who want to buy homes and would like to
have the opportunity to have a home and not get caught up in a
subprime market or, even worse, a predatory market such that
they find themselves only expending capital, not acquiring
equity and not building wealth.
I want to thank you again, Congresswoman, for convening
this hearing in Houston, Texas. I think I speak for all of
Houston when I say we will be eternally grateful that Houston
is now going to be a part of the focus, if you will, of the
housing issues in the United States of America. Thank you.
Chairwoman Waters. Thank you. Thank you, Congressman, for
that opening statement. We have such an appreciation for his
passion, and we just love his vocabulary. Okay. Without
objection, Ms. Jackson Lee will be considered a member of the
subcommittee for the duration of this hearing. And with that, I
recognize Ms. Lee for her opening statement also.
Ms. Jackson Lee. Thank you, Madam Chairwoman. And, again,
let me offer a deeply appreciated welcome on behalf of all of
the citizens of Houston in every congressional district that we
have the privilege of sending to the United States Congress. I
might leave off the concept that there was a change in 2007. I
won't be pointed in that. But that allowed Maxine Waters to
become the chairwoman of this subcommittee. You can see what a
difference a day makes in terms of the focus and the compassion
and passion. And so I thank her for her presence today, and it
is a delight to be able to work with my colleague. The smartest
thing that our Caucus could have done is to appoint Congressman
Al Green to the Financial Services Committee. We applaud that
act, and out of that was generated a great opportunity for
Houston.
I ask unanimous consent to put my entire statement into the
record, but I'll make these very brief points. Without a doubt,
I believe that when you think of our Constitution and our
beginning language in the Declaration of Independence, we all
are created equal with certain inalienable rights of life and
liberty and the pursuit of happiness. Although education and
housing may not have been directly mentioned, I don't know
about you, but I think that the quality of life of all of us is
dependent upon good education, good healthcare, and good
housing.
So I make these very brief points: One, we are looking
forward to this trust fund so that we can have a commitment to
affordable housing in this community and certainly across the
Nation. I encourage you to support this legislation. And even
though you may be in the State of Texas, call Senators across
the Nation. Particularly call our Senators and ask them to
support this very important legislation. And I will give you a
reason why: If you look at low-income owners who experience
severe costs and, therefore, block them out of the market,
you'll find among the 31,886 owner households with income below
30 percent of the area median income in 2000, almost half, 49
percent, spent more than 50 percent of their gross income on
housing costs and another 17 percent more than--more than 30
percent of their gross income. Disabled persons receiving SSI
benefits are particularly vulnerable to affordability concerns.
And so the most vulnerable people--for example, the fair market
rent for a one bedroom apartment in Houston is $633, which
exceeds by 5 percent the average monthly SSI benefits of $603.
So there are enormous costs for those who are seeking
affordable housing.
Let me move to another point that I think is very important
and close to Chairwoman Waters' heart and, of course, knowing
the Fifth Ward area, many of our older areas in Houston and
particularly areas in my district, she knows the number of
seniors who also suffer from the inadequate housing. I'm
grateful to the leadership of Congressman Green, who has worked
with me on these issues. But a couple of years ago, the City of
Houston suffered a number of challenges that required audits
and required the elimination of certain programs. One of them
happened to be the rehabilitation program of senior housing. In
actuality, the senior housing repair and rehabilitation was
actually stopped. When we recognized that seniors would suffer,
we brought together the Department's Director and Secretary of
the U.S. Department of Housing and Urban Development with a
goal of restarting the program. An agreement was reached where
the City would expend local funds and be reimbursed by HUD. The
program was restarted with new contractors and procedures.
Now, the home repair program for our seniors seems of
little consequence to City officials even though the repair of
senior's homes is a priority in the consolidated plan pursued
by HUD. Seniors continue to wait on a list. So we hope, as we
move through this hearing and further our interest, that we'll
be able to correct that problem.
My last point is just an example. Just last week, a senior
who had been on a waiting list expecting repairs came before
the City Council after being told that her property--that she
lived in the floodplain. The City staff who misread the
regulation had denied this woman home repairs because she lives
in the floodplain. Fortunately, Council Member Jarvis Johnson
called my office and we were able to connect the Council Office
with the HUD official who cited the chapter and verse of the
exemption that allowed repairs of this nature without regard to
the flood zone. So as we look for housing, we must include all
of those in our community--the disabled, the seniors, those who
need affordable housing.
And, Madam Chairwoman, I am so grateful for both you and
Congressman Green, because as I look as the representatives of
the homeless here in this auditorium--I took it upon myself to
drive around Houston late at night--12 to 2 in the morning--
just to see the second city that most of us don't see. The
enormous amount of homeless persons really begs for our action.
And so as I look to the State and look to the City and County,
I am grateful of your presence here but also of the leadership
of the chairwoman. And I'd like to, in a moment of personal
privilege, thank Mr. Guy Rankin, who is not here, Madam
Chairwoman, but who wanted to offer his appreciation to you
from the Harris County Housing Authority for their DHAP program
and also to acknowledge the work that they are doing. I thank
you very much. I look forward to this hearing, and I yield back
my time.
Chairwoman Waters. Thank you very much. I think that we
have some of the elected officials from the Houston area that
entered the room, so if you would like to make an introduction,
Mr. Green.
Mr. Green. I'm most appreciative, Madam Chairwoman. We have
with us this morning an outstanding elected official, public
servant, if you will, the Honorable Adrian Garcia, who is a
member of the Houston City Council. Adrian Garcia. I'd like to
also just acknowledge that our veterans have united and decided
to be here today as a unit. And we are honored to have a group
of veterans who are here. Veterans, would you just stand so
that we can see? Any veterans, of course, but these are
veterans who have united. They are here, and we must serve
them. They have served us well.
There are many institutions that were available to assist
when Katrina hit, but I will tell you that one that is in the
18th Congressional District, and I'm sorry that I can't move
them into the 9th Congressional District, but the Sheikh
Community Center is represented today by the Honorable Delord
Parker. Would you give him an expression of appreciation?
For the record, I would like to introduce a document, and
if there are others with documents that you would like to have
become a part of the record, I believe the chairwoman will
announce at some point that the record will remain open for
members. And if you'll give it to me, I will submit it into the
record for you.
But we have from the Honorable Gladys House--who needs no
introduction, but for edification purposes, I will tell you
that she's with historic Freedman's Town and Allen Parkway
Village--a document titled ``Affordable Housing Needs in
Houston, Unique Challenges and Opportunities.'' Madam
Chairwoman, I beg that have we have unanimous consent to place
this into the record as well as any other documents that I may
receive.
Chairwoman Waters. Without objection, it is so ordered.
Mr. Green. Thank you, Madam Chairwoman.
Chairwoman Waters. Mr. Green, I want to remind the veterans
of H.R. 3329, the Homes for Heroes Act, that has been
introduced by Mr. Green. One of America's shames is the number
of homeless veterans that we have on our streets all over
America. And not only will my subcommittee make this a
priority, we're saying to all of the presidential candidates on
both sides of the aisle that they better make that a part of
their platforms as they campaign to lead this country. So thank
you so very much for being here. Thank you.
With that, I'd like to introduce our first panel: Mr. Milan
Ozdinec, Deputy Assistant Secretary for Public Housing and
Voucher Programs, U.S. Department of Housing and Urban
Development; Mr. Michael Gerber, executive director, Texas
Department of Housing and Community Affairs; and Mr. Richard S.
Celli, director, City of Houston Housing and Community
Development Department. I'd like to thank all of you for
appearing for the subcommittee today, and without objection,
your written statements will be made a part of the record. You
will now each be recognized for a 5-minute summary of your
testimony.
We will start with Mr. Ozdinec.
STATEMENT OF MILAN OZDINEC, DEPUTY ASSISTANT SECRETARY FOR
PUBLIC HOUSING AND VOUCHER PROGRAMS, U.S. DEPARTMENT OF HOUSING
AND URBAN DEVELOPMENT
Mr. Ozdinec. Thank you, Madam Chairwoman. Good morning. My
name is Milan Ozdinec, and I am the Deputy Assistant Secretary
for the Office of Public Housing and Voucher Programs at HUD. I
wish to thank Chairwoman Waters, Congressman Green, and
Congresswoman Jackson Lee for inviting me here this morning to
appear before the subcommittee. Specifically, you requested
that I describe the Department's new Disaster Housing
Assistance Program and its implementation, including here in
the City of Houston, thus far.
The Administration recognizes the need to continue
assistance to Gulf Coast residents who remain displaced by
Hurricanes Katrina and Rita, many of whom are currently
residing here in the Houston area. The Disaster Housing
Assistance Program, or DHAP for short, is a new demonstration
program that will ultimately provide tenant-based rental
assistance to approximately 44,000 families. DHAP commenced
case management on September 1, 2007. The first rental
assistance payments under DHAP will begin December 1, 2007.
The DHAP is a temporary housing assistance program, and its
overall objective is to help families ultimately transition
back to permanent housing and economic self-sufficiency by
March 1, 2009. HUD is indeed responsible for the design,
implementation, and operation of DHAP. We welcome this
opportunity, Madam Chairwoman. Housing families in need is one
of our core missions. We are also in a unique position to help.
As you know, we have at our disposal a national network of some
2,400 housing agencies that administer HUD's Housing Choice
Voucher Program. We have proven to have the experience and
expertise at the local level to effectively administer tenant-
based rental assistance. These PHAs know their local housing
markets and already work with owners in the private rental unit
market. Housing authorities are involved in providing
assistance to families. Housing families is their bread and
butter. It's what they do.
DHAP may be a new program, but tenant-based housing
assistance has already proven to be a highly effective
mechanism for assisting displaced families. Shortly after
Hurricane Katrina, HUD developed and implemented the KDHAP
program to assist displaced families who were previously
assisted by HUD. Then in December of 2005, the Congress
appropriated an additional $390 million directly to HUD to
assist thousands of additional families displaced by Hurricane
Katrina--displaced who were previously HUD assisted or homeless
through the disaster voucher program. To date, over 33,000
families have received rental assistance through these two
programs. HUD is once again calling upon our public housing
authorities to provide assistance to eligible families under
DHAP. Since the vast majority of these families are already
housed, our PHAs will make rental assistance payments on behalf
of these families. These families may remain in their current
unit or, in some cases if they choose, they can find another
unit and move. In those cases where a family must move, the PHA
will provide housing search assistance.
Implementation of DHAP is well under way. We have published
operating requirements, contracts, grant agreements, and case
management procedures, including software development. We held
meetings with PHAs, landlords, and advocacy groups both here in
Houston and in other areas around the Gulf. We have provided
onsite technical assistance at PHA offices, broadcast
interactive Web casts, and established a DHAP referral call
center with a toll free number.
On August 11, 2007, FEMA referred to HUD 28,582 eligible
families for DHAP. Since then, we have executed 336 grant
agreements with PHAs that cover over 26,000 of those families.
Here in Houston, we have one of the largest concentrations of
DHAP families. We have executed two grant agreements, one with
the Housing Authority of the City of Houston, and one with the
Housing Authority of Harris County, to serve approximately
9,000 families. By way of contrast, Madam Chairwoman, through
the entire State of California, we only have 143 eligible
families for DHAP. With respect to the challenges and concerns
we face in regard to implementing DHAP, our biggest concern is
the nature of the transition from FEMA to HUD and all of the
complexities associated with it. For instance, this complexity
resulted in HUD concerns that the transitions would not be
seamless for all families. Therefore, it was decided to delay
the complete transition to DHAP from November 1, 2007, to
December 1, 2007.
Madam Chairwoman, members of the subcommittee, I cannot say
enough about the tremendous response and effort put forward by
our PHAs throughout the country. Without their dedication and
commitment, DHAP would not be possible. I especially would like
to commend both the Housing Authority of the City of Houston
and the Harris County Housing Authority for their exceptional
work on DHAP. All new programs have growing pains. Our PHAs,
through their hard work and perseverance, have been able to
ramp up this program and provide case management operations
within 30 days of signing an agreement with FEMA.
Madam Chairwoman, I wish again to express our enthusiasm
for being able to help. We believe that HUD, using our local
PHA infrastructure, can effectively and efficiently deliver
assistance. The expertise is already on the ground to link case
management services and housing assistance in order to provide
a comprehensive response to help families recover from a
disaster. In conclusion, and on behalf of the Secretary, Madam
Chairwoman, again, I want to thank you for affording HUD the
opportunity to discuss DHAP with you and the subcommittee in
its implementation here in Houston and around the country. I
would be happy to respond to any questions that you might have.
[The prepared statement of Mr. Ozdinec can be found on page
114 of the appendix.]
Chairwoman Waters. Thank you very much.
Mr. Gerber.
STATEMENT OF MICHAEL GERBER, EXECUTIVE DIRECTOR, TEXAS
DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS
Mr. Gerber. Good morning, Madam Chairwoman, Congressman
Green, and Congresswoman Sheila Jackson Lee. My name is Michael
Gerber, and I am the executive director of the Texas Department
of Housing and Community Affairs in Austin. I'd like to thank
you for the opportunity to appear before you today. Madam
Chairwoman, before I start, for those of us who have lived with
a natural disaster in Texas for the last 2 years, our hearts
and thoughts certainly go out to the people in Southern
California who are dealing with the effects of these horrific
fires.
Chairwoman Waters. Thank you.
Mr. Gerber. My department, TDHCA, is the lead State agency
to assist low-income Texans in finding safe, decent, and
affordable housing. Without you and your colleagues in
Congress, we couldn't do our jobs. And we'd like to thank you
for all that you do to help provide a better standard of living
for low-income Texans. We also want to join in thanking you for
your efforts in passing the new Housing Trust Fund legislation
that will help even more low-income Texans and other persons of
low income across the country to have greater access to
affordable housing.
The National Housing Trust Fund would enable our State to
have another tool in order to target lower-income Texans,
especially those at 30 percent and below. And we will certainly
take you up on your request to be in touch with our members of
the Senate to make them aware of the benefits of the Housing
Trust Fund nationally and here in Texas. Thankfully, our State
legislature has also received the word about the benefits of
the Housing Trust Fund. And thanks to the efforts of a number
of folks in this room, our State legislature in the last
legislative session approved an almost 60 percent increase in
our own State housing trust fund.
Even with all that help, we know that we're still not
reaching the need that's out there. So what exactly are we
doing? With the Federal funds available, we've allocated at
TDHCA more than $680 million for low-income Texans during the
2007 fiscal year that just concluded. With those funds, we
rehabilitated seniors and single head-of-household homes in
rural Texas allowing families to stay in their community while
repairing their homes to a decent standard.
We used private activity bonds to place a record level of
assisted and low interest rate unassisted mortgages helping
those people who are ready to take the next step in the housing
continuum of home ownership. These are safe, traditional
mortgages that provide real security rather than people going
to higher interest rate loans to gain homeownership.
Locally, through our Texas First time Homebuyer Program, we
have been able to help more than 1,500 families here in the
Houston area achieve the American Dream of homeownership. TDHCA
offers the lowest interest rates of any State agency and we
have a very safe and traditional mortgage product that's firmed
up by conventional underwriting. You'll find no exotic ARMs or
balloon mortgages through TDHCA.
We also work with the Department of Energy Weatherization
Program that not only saves energy but helps a family afford to
heat here in Texas and cool--cooling's very important--a home
without making choices between food and electricity.
And, of course, the public-private partnership of the Low
Income Housing Tax Credit Program has had a tremendous impact
in creating additional affordable house or rehabbing existing
housing and improving the quality of life for the residents in
those communities. For instance, here in the Houston area
alone, we have placed more than 26,000 units of affordable
housing since the program's inception in 1986. We have built
more than 250,000 units around the State. So it's a great
record of accomplishments, but clearly we need to do more. We
also make sure that every dollar spent is utilized for its
maximum impact.
And as a responsible steward of these valuable but limited
Treasury Funds, we closely monitor these units for compliance
with all State and Federal regulations. Once the units are
placed in service, we make sure that the residents and the
taxpayers get the full benefit of the program. This past year,
our State legislature gave us the power to levy financial
penalties up to $1,000 a day against those developers who are
not keeping their commitments. That's $1,000 a day per
violation. Accordingly, we'll make sure that those few bad
actors are firmly removed from the program and that a clear
message is sent industry-wide that TDHCA will not tolerate
slumlords. Our ultimate concern is always for the safety and
welfare of our low-income tenants, and we are proud here in the
Houston area to be partnered so closely with the City of
Houston and Harris County in that regard.
I also wanted to share with you this morning the active
work we've done in leading Texas' disaster recovery efforts
stemming from Katrina and Rita. While we appreciate the efforts
of the entire Congress in assisting Texans, I would be remiss
if I did not thank you, Madam Chairwoman, along with
Congressman Al Green, Congresswoman Jackson Lee, Congressman
Ruben Hinojosa, and Congressman Kevin Brady. So many other
members of the Texas delegation have been key in making sure
that we have some resources to assist Texans in need.
We expect with the dollars we receive, we will serve more
than 8,000 Texans here in Southeast Texas, including Harris
County. Shortly after Congress appropriated the funds, Texas
Governor Rick Perry designated TDHCA as the lead agency for
administering the funds that Congress has given to help us.
In May of 2006, we received our first allocation of funds.
That was $74.5 million, which was split almost evenly between
housing and infrastructure. The second allocation of funds came
earlier this year, and it totaled $428.6 million. We're working
very ambitiously to get those dollars out. Governor Perry
designated that $60 million specifically would be designated
for Houston, Harris County, to meet the needs of Katrina
evacuees. Houston will be using its $40 million of that $60
million for law enforcement overtime and public safety issues
associated with the influx of close to 200,000 Katrina
evacuees. And the City will also be using part of the funds to
rehabilitate many multifamily developments that are called home
by Katrina evacuees to ensure that they will have safe and
decent, affordable housing options. The remaining $20 million
will be used by Harris County for a myriad of social services
assistance programs for evacuees, such as crisis counseling and
medical services. The remainder of the funds are being used
primarily throughout Southeast Texas to meet the physical
devastation that has been suffered throughout the 22-county
area surrounding Houston and heading mostly east.
But, again, we will continue to report to you and make sure
those funds are used wisely. We are so grateful that you have
taken the time to come to Houston, Representative Waters, to
see this situation here firsthand. We welcome any questions.
[The prepared statement of Mr. Gerber can be found on page
60 of the appendix.]
Chairwoman Waters. Thank you.
Mr. Celli.
STATEMENT OF RICHARD S. CELLI, DIRECTOR, CITY OF HOUSTON
HOUSING AND COMMUNITY DEVELOPMENT DEPARTMENT
Mr. Celli. Thank you very much for the opportunity to
appear before you today and present brief remarks relating to
the unique challenges and opportunities in the City of Houston.
Two factors create increasing demand for affordable housing
in Houston: New households forming due to immigration or
population growth; and pent-up demand for homeless persons or
low-income households who are enduring substandard housing
conditions by two or more families sharing one roof.
According to the 2000 census, about 9,000 households per
year will be moved into Houston. In addition, 65,000 households
were reported as overcrowded in the 2000 census and
approximately 12,000 individuals in the City of Houston are
currently homeless. Total demand for affordable housing must
include some accounting for these underserved households. As
Congressman Green mentioned in his opening remarks, the
homeless population is a unique and severe problem in the City
of Houston. We work diligently as a city. We meet every 2 weeks
as a city, leaders within the city community, to try and solve
the homeless issue, but we need more dollars.
Due to the low incomes earned by many Houston households,
the overwhelming majority of housing units will have to be
affordable rental units, with less than 10 percent affordable
single family home units. The under 50 percent of area median
income, small family submarket is the most underserved in the
Houston market. Over 27,000 families are rent-burdened, meaning
that they spend more than 30 percent of their monthly income on
housing.
The demand for affordable housing is staggering. My staff
estimates that, including new arrivals and underserved current
residents, 2,000 households per year will demand affordable
housing products. Of these, 1,300 households are projected to
have incomes below 30 percent of area median income, and 700
households are projected to fall in the 30 to 60 percent area
median income. In addition, the Katrina evacuees currently
living in Houston and benefiting from re-extended housing
vouchers will eventually need to find housing on their own.
This will increase our demand further.
Historically, Houston City programs have invested about $54
million per year in housing. The City of Houston has worked
diligently to leverage all available resources, using low
income housing tax credits, HOME funds, and requiring developer
equity in outside debt in many multifamily transactions. The
City of Houston has encouraged private investment in
redeveloping historic neighborhoods via the Houston Hope
Program by granting downpayment assistance to low-income
families purchasing their first home, thus reducing the
mortgage risk to lenders.
Houston, like all major cities, works hard to meet the
needs of its citizens. Meeting all the demands for housing
would cost approximately $100 million a year. To close this
gap, additional resources are needed. I assure you, as director
of housing and community development, I could easily invest 3
times my current allocation of HOME funds every year and still
not meet the needs of deserving Houstonians.
Enactment of the National Housing Trust Fund Act of 2007
and the related Expanding American Homeownership Act of 2007
would help the City of Houston by providing more funds to
benefit low- to moderate-income families both directly and
indirectly. As a participating jurisdiction, Houston would
receive some portion of the trust funds intended to create
150,000 units of affordable housing nationwide each year. The
requirement that such housing be primarily targeted for
families with AMI below 30 percent would help those families
here who have the greatest demonstrated need for housing
assistance. Restructuring of the FHA program to reduce the need
for private market subsidy of subprime lending would provide
some benefit to Houston even though our housing stock is priced
very affordably. Any product that provides lower cost
alternatives for low-income households who qualify for
mortgages is a good product. I applaud the Representatives'
study of the needs of everyday households and welcome your
interest in Houston. Thank you very much for having me.
[The prepared statement of Mr. Celli can be found on page
57 of the appendix.]
Chairwoman Waters. Thank you very much. And while I failed
to announce Mr. Allison, I'd like to call on him now. Mr.
Horace Allison is a senior vice president of the Housing
Authority of the City of Houston. I thank you for being here.
STATEMENT OF HORACE ALLISON, SENIOR VICE PRESIDENT, HOUSING
AUTHORITY OF THE CITY OF HOUSTON
Mr. Allison. Thank you. Welcome to Houston. Chairwoman
Waters, Congresswoman Lee, and Congressman Green, I want to
thank you for your tireless efforts in support of affordable
housing. On behalf of the resident population that we serve, we
want to thank you for convening this hearing here in Houston.
The Houston Housing Authority operates about 4,000 units of
public housing and currently runs a voucher program of about
15,000 units. We have a waiting list of over 42,000 families
for those two programs. We opened our waiting list last
December and it was only open for 14 days. And to give you a
magnitude of the need, we ended up with 30,000 people in 14
days wanting to get on the waiting list. This does not include
people who may have not had the opportunity to or who may need
housing assistance but who elected not to.
There's a vast need for affordable housing in Houston. Our
current utilization rate is 99 percent for the Public Housing
Program, and 98 percent for the voucher program. In our voucher
program, we only have a turnover of about 120 units a month,
which means if you look at that 30,000 waiting list, it will be
a long time before those families can be served. Hence the need
for additional vouchers in the City of Houston. The families
that we serve, typically their income is about $10,000 per
year, whereas the median income for the City of Houston is
$61,000 a year.
How we've been trying to address some of these issues--the
Housing Authority, several years ago, embarked with HUD's
participation on the Hope VI program to develop additional
affordable housing. We received $56 million in Federal funding
in which we turned around and leveraged into $110 million. We
did that in partnership with both the private sector, the
public sector, and the City and State and local entities so
that we could leverage those funds. Out of that, we created
over 1,000 units of affordable housing. Rental, multifamily
rental, single family rental, homeownership opportunities for
families, inclusive of historic rental and homeownership, and
the provision of social and community services. The effort
revived a formerly neglected neighborhood in the near west end
of Houston. It was done with the help and in partnership with
various City leaders and departments.
Mayor Bill White of the City of Houston has formed a joint
task force comprised of the Housing Authority, Houston Housing
Finance, and Housing and Community Development to address the
affordable housing needs here in Houston. It's on the front
page. In Katrina and Rita, as you're aware, the Gulf Coast was
devastated. But Houston welcomed the evacuees into the City of
Houston. Working with the City, working with the County, we
processed over 60,000 families during a 4-month period of time
in helping them find shelters, moving from the shelters into
homes or into multifamily units. It took some 80 of our key
staff people working 12- to 14-hour days, 7 days a week, for
over 6 weeks, to address this need. The impact on our current
program was felt, however, knowing the need for maintaining the
existence of affordable housing in Houston, we prevailed, and
our current programs are functioning well.
Currently under the KDHAP DVP and DHAP program, we manage
about 1,500 DVP vouchers and we're working on 2,400 DHAP
vouchers. Our concern when this program ends is the need to
address those who will not be assisted, i.e., the elderly and/
or the disabled. There will be a need for additional vouchers
to address these families.
Some of the challenges that the Housing Authority faces
are: this vast waiting list, as I said earlier, 42,000
families; shortfall in the availability of development funding;
and operating subsidies at only 80 to 85 percent. And just
imagine if your household was only receiving 82 percent of what
you thought would be needed, you can feel the impact of that as
well as the Housing Authority. So there's an increased need for
public housing units in the City of Houston. A city of our size
should have upwards of 10,000 public housing units, and we only
have 4,000. There's a need for additional funding and support
to adequately support healthcare, education, and employment,
and provide supportive services, needs from HUD, simplification
of the rules and regulations so that Housing Authorities can be
more proactive in addressing housing needs, reforming the
adjusted income definition, and something as simple as--for the
seniors and the elderly, just something as simple as having the
elderly to be able to provide medical information through a
copy as opposed to having to go to the doctor to obtain a
certified copy.
Chairman, Chairwoman, and committee members, we want to
thank you for coming to Houston. We want to recognize again
your tireless efforts in support of affordable housing in
Houston. And we want to make sure that you're aware that the
Houston Housing Authority and others in the City are doing
their best to deliver and create additional affordable housing
opportunities as we move forward. Thank you.
Chairwoman Waters. Thank you all very much for your
testimony. I recognize myself for 5 minutes for questions. I
think I'll start with Mr. Gerber.
You mentioned that this legislature provided a 60 percent
increase in the State housing trust fund. Could you tell me
what that puts the funding level at and just discuss a bit
about the mechanism for funding the State trust fund as well as
the targeted requirements. And I think it was you that I talked
to earlier. You asked me about the City of Los Angeles housing
trust fund. I gave you a wrong figure. It's $100 million for
the City of Los Angeles. I think I was talking with you about
that. So tell me about yours.
Mr. Gerber. Sure. I wish I could say ours was anywhere near
a $100 million. We have historically received about $7 million
a year from the legislature. Thanks to the efforts of folks in
this room, it was increased by $5 million. The $7 million that
has been available remains largely limited to something called
our bootstrap program. That's--
Chairwoman Waters. This is for the entire State?
Mr. Gerber. For the entire State.
Chairwoman Waters. $7 million?
Mr. Gerber. $7 million--$12 million. $12 million is the
total.
Chairwoman Waters. $12 million is the total?
Mr. Gerber. $12 million now. It was $7 million, but now it
has gone up by $5 million.
Chairwoman Waters. Provided by the legislature.
Mr. Gerber. The $5 million. And that's the only money.
Chairwoman Waters. Did you put any of your CDBG money in
too?
Mr. Gerber. No, ma'am.
Chairwoman Waters. No CDBG.
Mr. Gerber. No CDBG.
Chairwoman Waters. Do you have any money that's coming from
the developers to support this fund in any way?
Mr. Gerber. No, ma'am. That's the only money.
Chairwoman Waters. So this is the total amount of your
statewide housing trust fund?
Mr. Gerber. That's correct. And the $7 million, a little
over, is largely used again for the bootstrap program, which is
a self-help, sweat equity program largely done in the Colonias
along the U.S.-Mexico border.
Chairwoman Waters. Largely on what?
Mr. Gerber. Largely sponsoring homes in the Colonias, which
are areas along the U.S.-Mexico border, that have just
tremendous needs. It's a sweat equity, Habitat for Humanity-
like construction program, and we have had tremendous success
down there using those very limited resources. The $5 million,
though, that the State legislature has put in, we're trying to
do a number of very innovative things. And we actually have
several notices of funding availability out for those funds.
Our hope is that we can prove that a little bit of housing
trust fund money can go a long way. And there are opportunities
to increase home ownership through production in senior
housing, multi-family housing. There are a variety of different
homeownership program options that might be available,
additional programs to provide barrier removable for the
disabled community and accessibility benefits for the disabled
community. That has certainly been a key thing.
We're also using some of those funds for gap financing for
disaster victims who are not able to quite get into a safe and
affordable repaired home or new home because they just don't
have enough money in the current benefit that we have in our
CDBG program for disaster recovery. So that gap--that missing
gap is also--we have about $1 million that is going into
meeting that, those gap financing needs for those folks in
Southeast Texas as well.
Chairwoman Waters. Just give me the total amount of State
assistance for housing for Houston. Tell me basically that in
addition to your housing trust fund, whether CDBG or HOME
funds, or any other funds or tax credits, give me an idea of
what the State does to assist housing in the Greater Houston
area, in Harris County.
Mr. Gerber. Sure. Thanks again to our tax credit program,
which is $42 million statewide, roughly 25 percent of that goes
here into the Greater Houston area for affordable housing. So
that's putting real multifamily housing units on the ground,
either new construction or rehabilitation. In terms of the home
program--
Chairwoman Waters. Wait. So going to both nonprofit and
for-profit developers?
Mr. Gerber. Yes, ma'am. That's correct. The HOME program,
the City of Houston is a participating jurisdiction, so they
receive a direct award of HOME funds. And that gets
administered by Mr. Celli.
Chairwoman Waters. That's from the State?
Mr. Gerber. From the Federal Government.
Chairwoman Waters. From the Federal--so that is CDBG
through the State to the local?
Mr. Gerber. That's the HOME program. The HOME program,
which can be used for a myriad of purposes, including tenant-
based rental assistance, homebuyer assistance, or owner-
occupied rehab. We at the State level manage a pot of about $45
million in home funds, but it's for largely the rural parts of
the State, the nonparticipating jurisdictions that aren't big
enough or sophisticated enough to manage their program on their
own. Large cities like Houston, of course, have that ability,
so they receive a direct allocation from HUD for the HOME
program.
Our other big program that we have are certainly the first-
time homebuyer program. We do a tremendous amount of business
here in the Houston area, not just in Harris County, but in the
surrounding counties which have large, booming suburbs. I'm
very pleased that just with our last issuance of first-time
homebuyer funds, $16 million got used within 30 minutes to
provide mortgages for families here in the Houston area, first-
time homebuyer mortgages here in the Houston area. So that's
another program. And right at the moment, we have $120 million
in funds available for folks here in Houston as well as
Statewide.
Chairwoman Waters. What would say is the poorest area of--
and maybe the Mayor would like to--the absolute neediest,
poorest area of the Houston area in your City, say, Mr. Celli?
Mr. Celli. We have several neighborhoods, Congresswoman,
that we're focusing on with Houston Hope--the Settegast area on
the near north side of Houston, Acres Home, and Sunnyside.
Those are the areas that we're focusing our attention with the
Houston Hope foreclosure program where we're trying to create
affordable housing and redevelop these neighborhoods.
Chairwoman Waters. So what do you do as the City and the
State combined to try to work together and target funding to
some of the neediest areas? And how is that realized? What can
you tell me about a combination of HOME funds, Housing Trust
Funds, CDBG, and other funds that you've directed? What
percentages do you put into the poorest areas?
Mr. Celli. Primarily we work with the State, with the low
income housing tax credit program. We try and leverage those
funds to do multifamily projects. Lately we've been focusing
our efforts on the homeless. We've done just one project that
we--that just scored number one in the State of Texas, an SRO
right on the Gulf Freeway in Houston, right as you come in from
Hobby Airport, where they were awarded low income tax credits.
And partnered with our dollars two to one, we're going to
credit about 175 brand new units of single room occupancy.
Chairwoman Waters. So are you focusing on permanent housing
for the homeless or basically still emergency shelters?
Mr. Celli. Still emergency shelters. We have a desperate
need for permanent housing for the homeless. We've spent our
initial efforts with rapid rehousing, but with--after the rapid
rehousing, we need to create some permanent housing in the City
of Houston along with the commensurate programs to get people
back on their feet, some support programs. Those cost money,
and there is a lot of money involved in that.
Chairwoman Waters. That will be a focus of our committee to
try and get permanent housing for the homeless. We think that
this vicious cycle of emergency shelters and people lined up
has to stop.
Mr. Celli. We applaud that.
Chairwoman Waters. Thank you. So we'll be looking forward
to the efforts put forth here and see what we can do to provide
some assistance.
To Mr. Allison, that waiting list that you have is typical
of what's happening all over the country. And the only way to
deal with that is what we're attempting to do through the
Housing Trust Fund, the National Housing Trust Fund, that will
present some new opportunities for people who need housing.
Hopefully, as Mr. Green described, through the resources that
we will get from the GSEs, Fannie Mae and Freddie Mac, and
Federal Home Loan, we'll be able to make some new money
available for the creation of new housing units.
As we look at our public housing, we have to figure out how
to expand those opportunities and give people some choices. And
as we look at Hope VI projects, we have to make sure that we
don't eliminate housing as been done with some of the Hope VI
projects where they redesigned these projects so that they look
beautiful and they're wonderful, but they don't tell us what
happened to the people who get lost after they redevelop the
housing projects and they reduce the size of those projects. So
we're going to look out for public housing and for expanded
opportunities for people who really do need that assistance.
With that, I'm going to turn to Mr. Green for his
questions.
Mr. Green. Thank you, Madam Chairwoman. And I thank the
members of the panel for being here today. Your testimony has
been very enlightening.
Let me start by just asking if we have any persons in the
audience who are with NGOs or some sort of 501(c)3, some sort
of entity that is trying to assist with housing? If you are,
would you raise your hand so that I can just get some sense?
Okay. We have a lot of people here who are working with
housing. And this is important. So I would like to ask each
member of the panel, as tersely as you can, to tell us about
some of the products that are available for these NGOs so that
they can benefit from much of what may not be published widely.
I understand that you have problems in terms of getting your
information out. You don't have big budgets to PR your
products. So let's talk about some of the products that you
have that they can benefit from. And friends, this would be a
good time for you to take out your pen and your paper. Because
one of the things that we want to do in Congress is make sure
that what we know and, to a limited extent some of what we
don't know, you have an opportunity to know.
So let me start with you, Mr. Allison. Tell me some of the
things that NGOs are doing that can be of benefit to them.
Mr. Allison. We have been partnering with other entities in
the development of affordable housing.
Mr. Green. Say that again.
Mr. Allison. We have been partnering with other entities in
the development of affordable housing. We don't have an open
RFP process, but any organization that desires to partner with
the Housing Authority or trying to obtain assistance through
the Housing Authority to develop affordable housing is welcome
to come in. We will sit down with them and evaluate their
project or their proposal and work with them to try to see if
we can go forward. We do have some limited capital moneys that
we are investing, whether it be with a nonprofit or a private
developer, but that is our process.
Mr. Green. Are you currently working with not-for-profits
in developing products right now?
Mr. Allison. No, we are not partnered directly with a not-
for-profit.
Mr. Green. If you have one that will perform some outreach,
you would be amenable to working with a not-for-profit--
Mr. Allison. Absolutely.
Mr. Green. --to develop a product?
Mr. Allison. Absolutely.
Mr. Green. All right. Thank you very much. Now, Mr. Celli,
in giving your explanation, if you would, tell us about the low
income tax credit just briefly, because we have a lot of NGOs
that can benefit from that kind of intelligence in terms of how
that can work to develop affordable housing.
Mr. Celli. Well, a low income housing tax credit is the
best way to create quality affordable multifamily housing for
low income individuals as well as seniors. It basically
provides a Class A property with Class C rents. No other
vehicle can leverage dollars the way that does, and we like to
use our Federal dollars in partnership to leverage the low
income housing tax credits.
Generally, we can do that sometimes two and sometimes three
to one. So what that really relates to, it costs about $100,000
to build a multifamily apartment unit that's a quality,
livable, decent place for people to live, but it only debt
service about $30,000 of that cost. So low income housing tax
credits, along with our dollars, can bring down that
affordability for our senior citizens as well as for our low-
income individuals.
Mr. Green. For further explanation, that low income tax
credit means that there is a tax certificate that is made
available to someone that we'll call a developer. Is that a
fair statement?
Mr. Celli. Yes, it is. And then it's sold to investors.
Mr. Green. Let's just make that clearer. When we say that
it's sold to investors, that means that this developer will go
out and find an investor who can benefit from a tax break?
Mr. Celli. Yes, sir.
Mr. Green. And he then will partner with him, and he'll
receive moneys from the investor that he can couple--that the
investor will benefit from the tax break, so he's willing to
give the money to the developer to develop property?
Mr. Celli. Yes, sir.
Mr. Green. And when this property is developed, of course
they all go to the bank. But it means that some not-for-profit
or some entity we'll call a developer has had the opportunity
now to build this low-income housing.
And tell me if we have some NGOs that are participating in
this process. Do we have some?
Mr. Celli. Yes, we do.
Mr. Green. Okay. Now for the benefit of those of you who
are listening and you want to get into the business of helping
to develop affordable housing, this low income tax credit is an
excellent means by which you can get involved. It really
provides money from the private sector by virtue of a tax break
that is accorded. Is that a fair statement, Mr. Celli?
Mr. Celli. Yes, it is.
Mr. Green. All right. Do you have another product that you
can tell us about briefly? Because my time is quickly passing.
Mr. Celli. The City of Houston just provided $700,000 to 10
different community development corporations to construct 10
houses in the Houston Hope neighborhoods. Those are the
neighborhoods that I mentioned earlier, like Sunnyside, Acres
Home, Settegast, and Independence Heights. That's a single
family program where we're encouraging new homes by community
development corporations with our product. Along with that,
we're coupling our down payment assistance program where for
the homeowner, you can buy down the mortgage up to $30,000 in
the Houston Hope neighborhoods.
Mr. Green. And for additional information on these products
and others that you may have, how would people access the
intelligence?
Mr. Celli. Call me. 713-868-8444.
Mr. Green. Now, if you did not get that number, raise your
hand--you need to repeat it.
Mr. Celli. 713-868-8444. That's a direct line to my office.
Mr. Green. Thank you, Mr. Celli.
Mr. Gerber. In the interest of time, I'll just add on. The
tax credit program, that is a very complex program. We were
very pleased about 3 or 4 months ago to do a--actually less
than that, an event with Congresswoman Jackson Lee, a workshop
with members of the faith-based community who are interested in
participating in that program. It is a very complex and
challenging program that really is something that requires some
degree of expertise. And many of the folks in this room have
those skills. We would very much welcome a chance to do another
workshop, maybe even partnered with the City of Houston and the
County under your good offices. Let's try to piece that
together to invite folks in this room to come together and
learn in a, you know, full-day workshop, which is really what
it takes to get, I think, a grounding of some of the benefits
and the risks of going into this. Because building a 250-unit
apartment complex is not something that one wants to go into
lightly. There's a lot that is involved. So we welcome that
chance. And, of course, we really value the leveraging that
goes on with locals in order to make those tax credit deals
work in places like Houston. So I would just focus really on
that program.
Mr. Green. Well, I want to thank you for volunteering and
being accessible. I think we'll take you up on that offer and
have that workshop. Absolutely. There's a competitive side to
the low income tax credit program. Are you prepared to address
that, or should I go to the next speaker?
Mr. Gerber. Well, there are really two tax credit programs.
There's a 4 percent tax credit program, and then there's the 9
percent tax credit program. It's the 9 percent tax credit
program that has the deepest subsidy and is the program that is
the most competitive. And, you know, we're oversubscribed for
those funds 3 to 1.
In contrast, the 4 percent tax credits are generally
layered with a bond transaction. And the Harris County, you
know, Housing Finance Corporation of Southeast Texas has a
finance corporation. All are bond issuers. The Texas Department
of Housing and Community Affairs is a bond issuer. And then we
will layer onto it 4 percent tax credits. There are plenty of
those. It's based on the volume counts the State receives to be
able to do an additional deeper targeting to make the economics
of the deal work. So for both a bond transaction, layered with
4 percent credits, or the 9 percent competitive program, I
would propose that we do a workshop that would link both of
those and talk about both of them. Because in many cases, in a
City like Houston, a bond transaction makes a lot of sense at
those 4 percents. You can make the economics of it work as you
can with the 9.
Mr. Green. Ms. Lucinda Daniels will contact you about it.
Mr. Gerber. I'll look forward it.
Mr. Green. Mr. Ozdinec, if you can respond quickly, because
my time is very limited.
Mr. Ozdinec. Sure, Congressman. As you know, the
Department's annual budget is about $32 billion a year. A
little more than half of that is the Housing Choice Voucher
Program. That's the engine that drives the rental assistance
market pretty much across the country. Our ambassadors to our
programs are literally public housing authorities and our
cities. All of our funds flow through the cities. But there are
things that can be done, obviously, in the Section 8 program
for the nongovernmental folks out here that do small-scale
development. They can reach out to their Public Housing
Authority. Each Public Housing Authority has the ability to
project base their vouchers. To the extent that a Housing
Authority is looking for properties or rental units in--
Mr. Green. Let me just intercede quickly. Explain that
term, ``project base.'' Many people may not understand exactly
what that means. That's an important term.
Mr. Ozdinec. I'll give you an example, a hypothetical. If a
Housing Authority had 1,000 vouchers in their program, they
could take the budget authority for up to 20 percent of that
voucher program and solicit proposals from developers,
nonprofit or otherwise, to provide rental units through the
project-based program. And they would sign a 10-year contract
with the Housing Authority to provide that unit for waiting
list families for that period of time.
That helps to support some of the deals that Mr. Gerber
discussed. The 4 percent deals are tough to do, but often when
there's project basing associated with it, it's the grease that
makes the wheel run.
Mr. Green. Thank you very much. Madam Chairwoman, I'd like
to submit for the record a statement from Council Member Adrian
Garcia. Without any objection, I offer it at this time.
Chairwoman Waters. Without objection, it is so ordered.
Thank you very much. Ms. Jackson Lee?
Ms. Jackson Lee. Madam Chairwoman, thank you very much. And
to all the witnesses, let me thank you for very instructive
testimony. Might I just repeat, because I think we have already
acknowledged the leadership of Chairwoman Waters, but let me
repeat these numbers that are so striking.
I want to pose a line of questioning that hopefully maybe
will change attitudes: 30,000 people came on the waiting list
in 14 days; 42,000 are waiting for Section 8 vouchers. I know
we can do better here in Houston. We can do better. And I thank
you for that instructive information, because we have to find a
way to move toward a corrective action. And so let me just
quickly--Mr. Ozdinec, let me quickly just refresh your memory.
As you know, about a decade or so ago, there was a mindset that
suggested that large structures such as Cabrini-Green in
Chicago, and some others in Atlanta, were not the way to go in
terms of public housing. Unfortunately, Houston got caught up
in the overall umbrella where Houston was not high density. And
so my question to you, listening to Mr. Allison and the crisis
we have here, that's Section 8, but he also mentioned the need
for public housing units. We have only 4,000. We've had 4,000
for decades. We now are minimally needing 10,000. What
policies, because of the policy that I've just enunciated--you
worked in New Orleans, you worked in Chicago and Atlanta--can
be altered to work with a city that really needs these public
housing units?
Mr. Ozdinec. Thank you. And I appreciate the question. The
thing that I think is the most important lesson that we could
have learned through the 1990's through the Hope VI program, if
there's one very important lesson, is partnerships. Up until
that point, Housing Authorities were doing public housing
developments on their own through direct appropriations from
Congress to build public housing projects. I think in the last
decade, we've gotten housing authorities familiar with the
terms that many of the people in this room are familiar with,
the difference between a 9 percent and a 4 percent credit.
What do I need to do to be a good partner to a private
developer so I can participate as part of a development process
where, for example, a 250-unit multifamily development can
support perhaps 100 very-low-income families as part of the
public housing program. We have, as part of that new
development process, instituted ways for nonpublic housing
authorities to own public housing through long-term rental
assistance agreements and other mechanisms that are available
to take what were traditionally operating subsidies to support
market rate and tax credit units combined together to generate
additional low rent public housing units in the context of a
larger community.
To the extent that housing authorities can take those tools
that they've learned on financing, mixing incomes, mixing
financing tools, partnering with developers who develop
affordable public housing across the country, and being a good
steward and a good partner for those sorts of deals, using
their Section 8 program potentially to project base, those are
all tools, I think, that we've learned through the 1990's. To
the extent that the Congress decides to appropriate any
additional development funds for the Department, my
recommendation would be for those funds to be used very similar
to the way we use the tax credit equity both on the 9 percent
and the 4 percent credits; that developers submit proposals--
Ms. Jackson Lee. I'm sorry. My time is limited.
Mr. Ozdinec. I apologize.
Ms. Jackson Lee. If you can wrap up.
Mr. Ozdinec. Well, that's it. I mean, that would be my
number one lesson, partnerships and a variety of funds being
pulled together to create partners and stakeholders around
affordable housing developments.
Ms. Jackson Lee. I guess the question I would have is
whether or not we have the ability through legislation or
otherwise to go back to those underutilized communities that
never had the density and let them build public housing. Is
that a possibility?
Mr. Ozdinec. If the money is there, Congresswoman, I think
the answer is yes to that. I think the method of development
now has changed from 30 years ago to something more akin to
what you see in Atlanta and some parts of Chicago now.
Ms. Jackson Lee. Thank you. Let me ask Mr. Celli on another
issue that I'm very keen on and, Mr. Ozdinec, if you can
respond to this as well, and that is the question of senior
repair housing under your community development funding. It is
in your consolidated plan. I understand the program is, if you
will, suspended. The question is the ability to be able to
address senior repair programs in a way that meets the needs in
this community. And Mr. Ozdinec, if you can speak from a
housing perspective--from HUD's perspective in the utilization
of these funds, so what we call senior repair reconstruction,
as to the viability of that. And why don't I go to you first
and then Mr. Celli, please.
Mr. Ozdinec. Thank you, Congresswoman. That is not my
account, unfortunately.
Ms. Jackson Lee. I understand.
Mr. Ozdinec. But I met with your staff this morning, and I
will definitely get them in contact with our Deputy Assistant
Secretary who runs the CDBG program. We can have a conversation
about that to ensure that your concerns are being met.
Ms. Jackson Lee. Mr. Celli.
Mr. Celli. We are in the process of going back and looking
at about 1,800 homes that are required by us, by HUD, to go
back and reinspect homes that we did senior repair to going
back to 2001 through 2005. And we have to go back and reinspect
those houses and fix them if they need to be fixed.
Unfortunately, we have a waiting list of about 2,000
individuals who are on that that are in need of repair work.
And that list was created when Federal funds were cut off to
the City of Houston in 2005. And so we're in the process--on
that 2,000 waiting list, we're looking at, I believe, 200 of
those houses right now. And we're beginning to try to whittle
down that waiting list.
Ms. Jackson Lee. So, Mr. Ozdinec, we can work with you to
correct this seemingly heavy burden on the City of Houston,
which is looking behind and not forward, the crisis of senior
housing and disabled housing on rehab and reconstruction, maybe
we can move along, because it really is at disaster proportions
in terms of seniors and the disabled not being able to have
home repair because the work that the City is now doing is work
that is fix-up work, meaning going back to try and correct
ills. And I know there should be a parallel track of them being
able to fix the problems of the past and report to HUD but move
forward on a program that is literally now stagnated and people
are suffering.
Mr. Ozdinec. Yes, ma'am.
Ms. Jackson Lee. Thank you.
Chairwoman Waters. Thank you very much. The Chair will
grant herself an additional minute because, as we walked in, we
were handed pictures from some of the citizens about homes that
were built, developers that were contracted with by the Housing
Authority, that are falling apart. Who is responsible for
making these homeowners whole for these homes that have been
paid for by HUD, I'm told?
Mr. Allison. I would need to see the properties. The
Houston Housing Authority is only responsible for homes in
Houston. We are not responsible for homes in San Antonio.
Chairwoman Waters. Well, without looking at these
particular ones--I'll give you a copy of these, are you aware
of this problem?
Mr. Allison. No, I'm not aware that--of the problems with
some homes that we have developed that are in disrepair. Not at
all.
Chairwoman Waters. All right. Are you going to stick around
after the panel?
Mr. Allison. Yes, ma'am.
Chairwoman Waters. Very good, because I think we have some
people here who will describe it in more detail to us. With
that, I think--yes?
Ms. Jackson Lee. May I read just two questions into the
record--
Chairwoman Waters. Yes, you may.
Ms. Jackson Lee. --just very quickly? This is for the
Secretary for HUD. Let me ask for a response to a series of
letters that I have written regarding the Allen Parkway Village
and the nonfulfillment of the Hope VI requirements that were
agreed to in the reconstruction and rehab of Allen Parkway
Village. The second one is the issue of HUD programs that may
be applied in a discriminatory fashion as relates to low-income
residents, particularly in the Fourth Ward area. And I'd
appreciate it. We have a series of letters in to you on that
issue.
Mr. Ozdinec. I'll look into that, ma'am.
Chairwoman Waters. They will be included in the record. The
Chair notes that some members may have additional questions for
this panel which they may wish to submit in writing. Without
objection, the hearing record will remain open for 30 days for
members to submit written questions to these witnesses and to
place their responses in the record. This panel is now
dismissed. I would like to welcome our second panel. Thank you
very much. I will call on Mr. Green to introduce the second
panel.
Mr. Green. Thank you. And as you're coming forward, I will
start the introductions because time is of the essence and we
want to cover as much as possible. So panelists, if you would,
kindly move forward as expeditiously as possible.
Our first witness will be Mr. John Henneberger. He is the
director of the Texas Low-Income Housing Information Service.
This organization provides a great service in terms of
statistical information. We are honored to have Mr. Henneberger
with us.
Our second witness is Mr. Robert Muhammad, the chief
executive officer of ACTION CDC; they very much involved when
the Katrina survivors were coming to the City and in need of a
multiplicity of services. They were, of course, there to be of
assistance.
Our third witness is Ms. Debra Junor, a member of the Texas
Tenants' Union. She, I believe, has testified in Washington,
D.C. If not Ms. Junor herself, we've had a member of the
organization to testify before us in Congress.
Our fourth witness is Ms. Toni McElroy, the president of
Texas ACORN. Texas ACORN has been to Washington many times on
behalf of Katrina survivors, and we're honored to have Ms.
McElroy with us today.
Our fifth witness is Mr. Daniel Bustamante, the executive
director of the Greater Houston Fair Housing Center, a long-
time community activist and champion for persons who are
suffering from homelessness.
Our sixth witness is Mr. Gordon Quan, founding partner of
Quan, Burdette and Perez, here today on behalf of the National
Coalition of Asian Pacific American Community Development, also
shown as CAPACD.
And, finally, we have Mr. Manuel Lopez, the housing
director of the Tejano Center for Community Concerns. I would
add also that Mr. Quan is a former city council person--I
neglected to say this--who chaired the Housing Committee for
the City of Houston. And Mr. Lopez has been involved in this
community for some time as well. I don't see him currently; but
if he does arrive, of course we will hear from him. With this
said, Madam Chairwoman, I yield back to you.
Chairwoman Waters. Thank you very much. We will start with
Mr. Henneberger. We will recognize you for 5 minutes.
STATEMENT OF JOHN HENNEBERGER, CO-DIRECTOR, TEXAS LOW INCOME
HOUSING INFORMATION SERVICE
Mr. Henneberger. Thank you, Madam Chairwoman, and members
of the subcommittee. I want to thank you for the opportunity to
be invited to testify today. I'm John Henneberger. I'm the
director of an NGO that undertakes education, research, and
advocacy concerning the low-income housing and community
development needs of Texans. Madam Chairwoman, beyond the
course of this hearing, I would urge the committee to help us
shine the light on the problems and challenges that have been
encountered with providing housing assistance to the 75,000
Texas families who lost their homes or had their homes severely
damaged by Hurricane Rita. We are coming to a train wreck
regarding this program because of a lack of adequate funding
and the fact that many of the poorest people who had their
homes destroyed by Hurricane Rita in Texas stands not to be
able to receive any housing assistance because of the shortage
of available funds, but that is a topic for another day.
And today I would like to first begin by talking to you
about the current state of affordable housing in Houston, which
I can best characterize as a worsening crisis. There are four
trends that highlight the critical housing challenges that face
Houston; first of all, the large share of Houston residents who
rent rather than own. Madam Chairwoman, it is counterintuitive
to those of us in Texas who are very proud of our independence
and our ownership to find that we are 41st among the States in
homeownership. And it is deeply distressing to find that
Houston is 57th among the large U.S. cities in terms of
homeownership. We are 22 percentage points below the national
average of homeownership here in Houston. And we are 10 percent
below the rate of homeownership of central cities in the United
States.
So Houston is a profoundly troubled city in terms of its
extremely low rate of homeownership. Houston's rate of
homeownership is lowest among all the major cities in the State
of Texas. We also have a very large share of renters who pay
too much of their income for rent and utilities--36 percent of
all the renters in Houston have incomes below $20,000. And many
of these, as I think you have already well summarized in
statistical data, are severely rent-burdened; 140,000
households in the City of Houston with severe rent burdens. I
provided you 20 pages of testimony which provides you detailed
statistics, so I won't go into all of the details here.
The fourth characteristic trend in Houston is the shortage
of rental housing to the low-income families who need that
housing. And the City has, based on our estimates of the 2005
American Community Survey, a deficit of 49,323 homes for
extremely-low-income families, that is, families below 30
percent of median family income. I provided you in my testimony
a breakout by congressional district. And those congressional
districts which represent the Greater Houston area have a
deficit of 108,000 homes for families with incomes below 30
percent of median family income. The crisis is truly
astronomical.
The fourth trend is the sizable gap between the
homeownership of the City of Houston and its suburbs. This gap
is 23 percent. The ratio of Houston homeowners to suburban
homeowners is 23 percent lower in the City of Houston than it
is in the suburbs. And this is in excess of national trends of
major metropolitan areas and their suburbs.
And, finally, government housing subsidies, as Ms. Jackson
Lee has explored with a previous witness, in Houston are
disgraceful. And the government housing, in essence, has to
provide the safety net for the poorest families in most cities.
In Houston, the rate is substantially below that of most of the
rest of the country. Houston has the smallest number of per
poverty population--smallest number of Section 8 units and
public housing units per the number of people in poverty of any
of the 20 largest cities in the country, with the exception of
Detroit and Phoenix. We are well below the rate. We have only
one Section 8 and public housing unit for every 22.5 persons in
poverty in this town. That is that a disgracefully low rate.
All of these make for a major affordable housing crisis in
Houston. And then came Hurricanes Katrina and Rita, and things
suddenly got a whole lot worse.
I'll briefly summarize a few of the challenges that the
City of Houston and the surrounding community have faced in
meeting the housing needs of Katrina and Rita evacuees, first
and foremost of which is that Texas has received grossly
inadequate levels of funding for hurricane survivors for
housing assistance. The total amount budgeted currently for
assistance for Katrina evacuees in this City, which received by
far the largest number of Katrina evacuees of any city in the
country, is only $60 million.
Now, of that $60 million, in our opinion, the City made a
poor choice to spend a large portion of that money for
additional policing and for reimbursement of various costs the
City has incurred. We believe that if you only have $60
million, the first people in line ought to be the people who
were hurt and lost their homes. And the government ought to
stand behind them. The housing programs, furthermore, that we
have available, housing resources that we have available--the
other housing resources we have available is largely limited to
the Low Income Housing Tax Credit Program. And Texas did get an
allocation from Congress of additional funds under the Low
Income Housing Tax Credit Program. But the Tax Credit Program
cannot serve people at the income levels of the average Katrina
and Rita evacuee. They just cannot afford those rents. And, in
fact, a recent market study by the Texas Department of Housing
and Community Affairs has shown that Houston is actually
overbuilt with tax credit units of 60 percent of median family
income while we have 140,000 plus families below 30 percent of
median family income who are paying more than 50 percent of
their income for rent. Texas came together and submitted a plan
for long-term housing recovery and submitted it to the
President in 2006, which I've attached to my testimony.
Unfortunately, those specific recommendations have largely not
been provided for.
I know my time is up, and I'll briefly--I'll move quickly
to our specific recommendations from that letter. First of all,
if Houston is going to make it, it's going to need substantial
new Section 8 Housing Choice Vouchers, and I don't know exactly
where they're going to come from given the budget situation the
way it is. The combined organizations which looked at the Rita
and Katrina problem estimated that Texas cities all together
needed 36,000 incremental additional Section 8 vouchers in
order to deal with the Katrina and Rita population that we've
had.
We need an additional, in our estimate, $97.5 million of
low income housing tax credits, but only if we can get that
coupled with a rules waiver which will allow the State issuing
entity to permit the State to fund a portion of the apartments
within each development at a higher level than the 9 percent
credits. In other words, use the total cap of authority that
Congress would give the State for low income housing tax
credits but allow them to enhance the subsidy so we can get
some units at the 40 percent of median family income rate,
because we are only able effectively to generate at the upper
50 percent and 60 percent of median family income rate with tax
credits.
Chairwoman Waters. Mr. Henneberger, is all of this in the
attached testimony that you've given us?
Mr. Henneberger. Yes, ma'am, it is. And I thank you very
much for the opportunity to testify before you today.
[The prepared statement of Mr. Henneberger can be found on
page 71 of the appendix.]
Chairwoman Waters. Thank you. And I'm hopeful that you will
make sure that the plan that you alluded to that was presented
to the President about how to fix some of this is not only made
available to us but you will perhaps even, at the invitation of
Mr. Green, come to Washington and work with us on that.
Mr. Henneberger. Thank you.
Chairwoman Waters. I appreciate it very much. And I'm
sorry. We're going to have to move on in order to get to
everybody's testimony in the time that we have been alloted.
Mr. Muhammad.
STATEMENT OF ROBERT MUHAMMAD, CHIEF EXECUTIVE OFFICER, ACTION
COMMUNITY DEVELOPMENT CORPORATION
Mr. Muhammad. Chairwoman Waters, Representative Green and
of course my own representative, Sheila Jackson Lee, I am
Robert Muhammad. I'm the founder and CEO of ACTION Community
Development Corporation. I would like the record to reflect,
Madam Chairwoman, that I am being joined today by Ruqayya
Gibson who is our executive director, and Sadiyah Evangelista,
who is a board member and our general counsel for ACTION CDC.
I hold a master's degree and I am currently beginning the
dissertation phase in my Ph.D. work in the field of urban
planning and environmental policy at Texas Southern University
here in Houston. I have served as a student in the ministry and
a community servant in Houston for over 20 years.
ACTION CDC's mission is to empower low- and moderate-income
individuals, families, and neighborhoods. Our motto is,
``Improving Our Nation One Neighborhood at a Time.''
Houston-- Just some background, Madam Chairwoman. Houston
is a nonzoned, low regulation, market-driven, developer-
friendly city. Houston's cost of living is relatively low, as
you noted, in comparison to California. When rental cost and
unit availability are the variables used in determining housing
affordability, one could reasonably conclude that there's no
shortage of affordable housing stock in the City of Houston.
However, a more thorough examination will reveal that there is
a shortage of safe, hazard free, environmentally sound, energy-
efficient, handicap accessible, senior citizen and family
friendly affordable housing, conveniently located near transit,
decent schools, and job centers.
In Houston, for-profit developers would gladly build
affordable housing if it was in their best interest. Land
acquisition and carrying costs, predevelopment expense,
construction, and marketing for sales and rental dictates that
each project in its highest and best use results in the highest
return on investment. Therefore, housing stock in Houston is
built--or affordable housing stock in Houston is built by small
for-profit developers or nonprofits or is the result of
cyclical market forces that make housing units available
because they cannot reasonably command market prices without
major reinvestment and redevelopment.
I just want to go through the challenges of meeting the
housing needs of Katrina evacuees, and then I will, if time
allows, tell you the projects that ACTION is working on in
terms of building some housing. After Hurricane Katrina, ACTION
CDC provided housing counseling to 1,400 Katrina families,
financial recovery counseling to 1,120 families, case
management services to 916 families, employment services to
1,620 families, food services to 5,090 families, and
transportation assistance to 2,050 families. We have provided
$172,164 to families in unmet needs assistance from the long-
term recovery committee of Houston, $85,000 in direct financial
assistance, $240,000 in financial assistance through the
American Red Cross. Our staff of eight hard-working case
managers includes four Katrina evacuees.
Now, according to a recent statistic, nearly 3 years after
Hurricane Katrina, an estimated 100,000 survivors still reside
in Houston and have no concrete plans to leave and return to
New Orleans. Many are elders and they are losing hope,
suffering from prolonged mental anguish and/or dying.
Another challenge is that in assisting 30 percent of the
survivors who are elderly or disabled, with meeting the long-
term needs, the survivors who were able to live off of a $600
disability check in New Orleans cannot do so in Houston due to
our cost of living. And they cannot do so in New Orleans any
longer because the cost of living there has doubled since the
hurricane. According to a recent Zogby poll, a large number of
survivors are currently employed, but 70 percent earn less than
$25,000 per household. Many survivors that we have been engaged
are living two and three families to a household, which
contains 9 to 18 individuals per apartment. The constant
instability in the FEMA housing program has had a negative
effect on the mental health of survivors. For the past 2 years,
ACTION CDC has made it our priority to assist the survivors
with recovering and achieving self-sufficiency.
The HUD-funded Disaster Housing Assistance Program
administered jointly through the City of Houston and Harris
County Housing Authorities will not help every survivor. There
are an estimated 25,000 households in Houston not covered by
DHAP, and at least 50 percent of those households need
additional assistance. This is a complex situation, meeting
housing and human needs, will most certainly require patient
pragmatic, holistic case management. And funding to provide
these services haves to be adequate and ongoing.
In terms of tools that are needed to increase and preserve
affordable housing and our position on the National Housing
Trust Fund Act of 2007, H.R. 2895, let me say it like this to
this distinguished panel subcommittee. Nonprofits in a
nonzoned, low regulated, market-driven, developer-friendly city
such as Houston are at a distinct disadvantage. Sometimes it
feels like we're being asked to make brick without straw. In
order to increase and preserve affordable housing, we request
that you consider the following.
Continued and increased access to funding, programs such as
HOME and Community Development Grants are critical to
nonprofits to be able to design, build, and manage quality
affordable housing in the communities we serve. Operating funds
for Certified Housing Development Organizations is equally, if
not more, important because it frees the nonprofit to focus on
project delivery versus a preoccupation with seeking funds to
cover related overhead. Funds for staff, consultants, and
quality training are important to building the internal
capacity necessary for continual project success.
Transparency and clarity of process has already been
stated. Federal and State and City entities should simplify
processes and documentation requirements.
Land acquisition funds, nonprofits cannot build or preserve
affordable housing stock if we cannot assemble parcels near job
centers, transit, or in low-income areas that are going through
gentrification. Land cost normally should not exceed 20 percent
of one's total project cost. Nonprofits need gap land
acquisition funding in order to build affordable projects that
would otherwise be impossible under highest and best use
analysis.
Lastly, we need predevelopment funds. Nonprofits cannot
properly assess the feasibility nor deliver affordable housing
projects without competent, professional expertise. Private
lenders will not participate in projects that are not packaged
properly or fail to cash flow. ACTION predicts that energy
usage and expense along with public safety will become major
determinants of housing affordability in the future. Energy
efficient ``green'' building and safety through design programs
increase cost during the development phase. However, these
predevelopment expenses increase development sustainability and
property value over the life of the project.
I close with this. ACTION CDC fully supports the National
Housing Trust Fund of 2007 because it will provide increased
funding and clear benchmarks for achievement. The addition of
significant funds will be tremendous in its impact on
underserved communities. In a major metropolis such as Houston,
new and existing nonprofits need to be positioned to assist
government in meeting our low-income population's needs. We see
H.R. 2895 as a wise use of taxpayer funds. H.R. 2895 helps
deconcentrate poverty by allowing nonprofits to offer quality
workforce housing to middle class first responders, teachers,
and other public employees. It is good for nonprofits because
it has the potential to help create innovative affordable
housing developments that are mixed income, mixed use,
transportation oriented, environmentally sound, energy
efficient, hazard mitigated, safe, handicapped accessible and
financially feasible. May God bless you for your concern for
the poor and less fortunate. On behalf of the Board and staff
of ACTION CDC, thank you in advance for your invitation and
consideration of our testimony.
[The prepared statement of Mr. Muhammad can be found on
page 110 of the appendix.]
Chairwoman Waters. Thank you very much.
I'd like to ask the other members of the panel to please
summarize your testimony. We're going to try to wrap each of
your presentations up in about 4 minutes. We allowed the first
two to go far beyond the 5 minutes, because I know they have
been waiting a long time to tell somebody about what is going
on and what the needs are. I think they have done a pretty good
job of kind of identifying what the needs are, so I'd like you
to just add to it as quickly as you possibly can, and then
we'll give the members an opportunity to ask some questions. We
will then have to catch planes to go back to Washington to
vote. Thank you very much.
STATEMENT OF DEBRA JUNOR, MEMBER, TEXAS TENANTS' UNION
Ms. Junor. Good morning, Congresswoman Waters, Congressman
Green, Congresswoman Jackson Lee, and members of the committee.
My name is Debra Junor, and I'm here of behalf of the Texas
Tenants' Union, a nonprofit tenants' rights organization which
empowers tenants through education and organizing to protect
their rights, preserve their homes, improve their living
conditions, and enhance the quality of life in their community.
I am a former tenant of a HUD-assisted apartment complex, a
former HUD-funded VISTA volunteer, and a former tenant
organizer for the Texas Tenants' Union.
The HUD properties I have worked in and will discuss today
are privately-owned apartment complexes that either have HUD-
insured loans or project-based Section 8 Housing Assistance
Payments contracts, or both. In the 1960's and 1970's, HUD
encouraged private developers to build affordable housing
through low-interest HUD-insured loans. In exchange, the owners
were required to keep rents affordable to low- and moderate-
income people.
In the late 1970's and early 1980's, HUD began providing
additional subsidies to some of these developments and created
new apartment complexes with the project Section 8 program.
This program provided great affordability to low- and
extremely-low-income people similar to the public housing or
Section 8 voucher program.
In the mid 1980's, some owners began paying off these HUD-
insured loans which released them from the obligation to
provide affordable housing. One of the first prepayments in the
country occurred in Dallas, Texas, where the apartments were
demolished and replaced with a 17-screen theater. At that time,
there was no Federal program designed to keep the properties
affordable and no protection at all for the residents.
I'm going to skip a whole lot because of the 4 minutes. The
Texas Tenants' Union participates in the Preservation Working
Group, which has a number of recommendations:
Provide adequate appropriations to renew Section 8
contracts. HUD's failure to request appropriate appropriations
is a huge threat to the success of preserving this housing. It
is essential for Congress to fix this problem very soon. TTU is
working with a property in South Texas now that is likely the
casualty of this fiasco.
Strengthen the mark-to-market program. Mark-to-market has
generally been an effective tool for preserving and improving
Section 8 housing; 134 properties in Texas are involved in this
program, including nine in Houston. At least two dozen Houston
properties could still benefit from mark-to-market
restructuring in the reforms pending in H.R. 3965.
Amend H.R. 3965 to direct HUD to fund the technical
assistance programs to tenants. Expiring subsidies can have a
drastic impact on residents. And tenants can play a critical
role in determining the outcome of these properties. Please
include the amendment that was submitted in the National
Alliance of HUD Tenants testimony on mark-to-market last week.
Enact a Federal first right of purchase. This could be a
very useful tool in getting at-risk properties under new
ownership willing to keep the subsidies in place.
Ensure vouchers are provided for all families and units
when properties are not preserved. Too many low-income families
have fallen through the cracks as subsidized properties convert
to market-rate housing.
Empower tenants to enforce their rights when HUD
enforcement is lacking.
Provide HUD with the direction to save troubled properties
and other at-risk housing through the enactment of H.R. 44. Our
written testimony elaborates on the recommendations. Thank you
for giving me the opportunity to testify on these issues.
[The prepared statement of Ms. Junor can be found on page
93 of the appendix.]
Chairwoman Waters. Thank you so much, Ms. Junor.
Ms. McElroy, thank you for being here. We are very much
aware of the work of ACORN all over the country. You made your
presence known in Washington.
STATEMENT OF TONI McELROY, PRESIDENT, TEXAS ACORN
Ms. McElroy. Okay. Thank you, Chairwoman Waters,
Congressman Green, and Congresswoman Jackson Lee. Thank you.
I'm glad to have the opportunity to testify today about the
affordable housing needs of low-income residents in the City of
Houston. I'd just like to skim over some of the challenges of
affordable housing needs in this City as well as the challenges
of low-income families to achieve and maintain homeownership,
the lack of protection for renters, the remaining long-term
housing needs of Katrina survivors which has been documented
today, and finally some recommendations to enhance the
availability of affordable housing.
There's a shortage of affordable housing construction
within the City. The developers are building affordable
housing, but it's outside of the City limits. Many times they
are putting minority residents, outside of the City of Houston
where there's no public transportation, where there's no
healthcare facilities, where there are few, if any, job
centers. So our neighborhoods are being gentrified. And the
infrastructure is being improved, but the traditional residents
are gone, so we don't benefit from that at all.
Third Ward is an example of such a community. Let me talk a
little bit about our predatory lending and housing campaign. We
have issued a report called ``Foreclosure Exposure'' which
examines the Home Mortgage Disclosure Act data and talks about
what's happening right here in Houston. African-Americans were
issued 26 percent of all the high-cost home purchase loans in
Houston in 2006, but only 6.7 percent of the prime home
purchase loans. Latinos were issued 32.8 percent of those same
high-cost loans originated here in Houston and 20 percent of
the prime loans, which is greater than their--which is really
out of whack. In contrast, Whites received 52.5 percent of the
prime loans originated in Houston, 52.5, which is greater than
their 30 percent share of the high-cost loans originated here.
African-Americans represent 16.6 of the population in the
metropolitan area, but they're getting a great number of the
high-cost loans. Latinos in the Houston area represent about
28.7 percent of the population. So the home loans, the
mortgages that are being written are really bad predatory
loans, and they're affecting minority buyers out of proportion
of their population in Houston. Immigrant families are falling
victims to a number of scams which we have worked on, including
the contract for deeds.
Also, it has been mentioned about the home repair program.
ACORN members, along with Members of Congress, Congresswoman
Jackson Lee have fought tooth and nail. We went to the City, we
went to HUD, and there's still not enough money for senior home
repairs. There has been a lot of improvement under Mayor White,
but we need more dollars, especially Federal dollars, to get
into the program to help seniors who are literally dying before
their repairs can be made. So we're encouraged by the
improvements, but we know that there is a need for more.
There are few protections absolutely for renters, because
Houston, as been alluded to, has such a high number of renters
for a city this size. For a major city, most of the folks are
renters. And there is no protection. ACORN members in other
areas have gotten legislation, such as having landlords being
licensed and being fined for not keeping up their properties.
Something of that nature is needed right here, right now.
And, of course, the housing needs for Katrina survivors,
the rise in foreclosures, ACORN is--along with its sister
organization, ACORN Housing, has been meeting with banks,
mortgage companies, and services to try and get some relief for
the almost 2 million families that could lose their home in
foreclosure in the next few years. So we'd like to see a number
of things happen, one of which is that the State of Texas
should enhance enforcement and oversight of landlords, of which
we have none now.
[The prepared statement of Ms. McElroy can be found on page
104 of the appendix.]
Chairwoman Waters. Thank you very much, Ms. McElroy.
We are going to have to move to Mr. Bustamante now. Thank
you.
STATEMENT OF DANIEL BUSTAMANTE, EXECUTIVE DIRECTOR, GREATER
HOUSTON FAIR HOUSING CENTER
Thank you. Good morning to the honorable members of the
subcommittee. My name is Daniel Bustamante, and I'm the
executive director of the Greater Houston Fair Housing Center.
I'm here today to testify before you about the fair housing
needs and the state of fair housing in Houston, Texas. After
hearing testimony today, all I have to say is that housing
discrimination is alive and well in our City. It is a daily
occurrence in the lives of thousands of families and children,
Blacks, disabled individuals, Latinos, and other protected
class members.
Since the passage of the Federal Fair Housing Act in 1968,
and its amendment in 1988, the issue of housing discrimination
has continued to be prominent in the development of the City of
Houston. Studies and surveys have consistently shown that
housing discrimination against African-Americans and Hispanics
continues unabated in our region. The influx of Hurricane
Katrina evacuees exacerbated this historical housing
discrimination problem and has been documented through testing.
The area's demographics include an ever-growing immigrant
population, with limited English proficiency, who are
victimized daily by unscrupulous housing providers. The
disabled in our region are in constant need of fair housing
enforcement services, such as reasonable accommodations and
modifications to ensure their rights to barrier-free living.
Houston is the largest city in the south as well as the
fourth largest city in the country. The use of racially
restricted covenants to maintain segregated communities is not
very far removed. The 1968 Civil Rights Act through the Fair
Housing Act made housing discrimination practices illegal and
created the protected classes that exist today. In spite of
these laws, housing discrimination has continued throughout
America and still occurs on a daily basis in the Houston area.
In general, people move into better housing situations so
they can improve their quality of life. The ability to access
quality housing will impact access to quality education,
employment opportunities, retail establishments, parks,
churches, and other public services. Most people are totally
unaware of their fair housing rights. Discriminatory practices
in housing can be quite subtle and are unlikely to be detected
by victims.
The United States Census clearly shows segregation and the
changing patterns in the ethnic and racial composition of
Greater Houston's neighborhoods. Over the last 30 years, the
primarily White communities have developed in areas towards the
outskirts of the City of Houston and in the surrounding
counties. In recent years, many of the historically minority
low rent communities in the inner city have been redeveloped
into high-rent mostly white communities.
The metropolitan Houston area includes a large region with
multiple counties, and the further away you get from the City
of Houston into the surrounding counties, the less colored the
community becomes and the more White it is. The City of
Houston, for example, is a majority-minority community, but if
you take the population surrounding Houston, it is primarily
White. And what has been happening, and this has been
documented by studies all the way from Harvard and a lot of
other prominent universities that are quoted in my documents,
Houston is still a segregated community. We have desegregated,
but we have not really paid attention to what's going on in our
community with discrimination.
The 2007 Fair Housing Trends by the National Fair Housing
Alliance indicates that the incidence of discrimination against
African-Americans, Latinos, and Asian-Americans continues
unabated. In Houston, the Housing Discrimination Study in the
year 2000, which was conducted by HUD, found that African-
Americans and Latinos were discriminated against 25 percent of
the time when they went to rent homes and 19 percent of the
time when they went to purchase them. These statistics continue
to be very real.
Our agency did a rental audit in 2001, and through testing,
we found the following: 85 percent of families with children
were discriminated against when they sought to rent; 80 percent
of African-Americans were discriminated against when they
sought to rent; and 65 percent of Hispanics were discriminated
against when they sought to rent. These are very real figures
that we have documented through independent testing that we
have done.
These figures continue to trouble us because we understand
that people move for the right reasons. The disabled in our
community, for instance, are being forced to file complaints,
Federal complaints, to get such basic needs as accommodations
and modifications for their living situation because of
landlords' inability to comply with the law.
Our City is experiencing a tremendous growth right now.
Over 29 percent of our City is foreign born. 47 percent of the
population over 5 years old speak a language other than
English. This community is bringing new dynamics to our City,
and they're very much being targeted by unscrupulous landlords.
Families with children, for instance, represent a significant
part of this tremendous growth. Single-parent families and two-
parent homes with several children are very common in the City.
Many families are denied their fair housing right when they
seek to improve housing. Children are constantly made to suffer
policies by landlords who don't tolerate children. They
frequently take advantage of families through penalties and
fines when they're trying to get them to move to larger units.
I do want to address this panel about the Housing Fairness Act
of 2007.
[The prepared statement of Mr. Bustamante can be found on
page 44 of the appendix.]
Chairwoman Waters. We are going to have to move on to Mr.
Quan. I'm so sorry. We're going to have to limit our time.
Thank you very much.
STATEMENT OF GORDON QUAN, FOUNDING PARTNER, QUAN, BURDETTE AND
PEREZ, ON BEHALF OF THE NATIONAL COALITION FOR ASIAN PACIFIC
AMERICAN COMMUNITY DEVELOPMENT
Mr. Quan. Thank you, Chairwoman Waters, Congresswoman
Jackson Lee, and Congressman Green. My name is Gordon Quan, and
I am here representing the National Coalition of Asian Pacific
Community Development, as well as the Asian Chamber of
Commerce, our largest Asian business group in the Houston area.
You have copies of my testimony, so I'll go straight to the
items that have not possibly been covered.
Houston, as you see, has a very unique situation. You asked
the question, Ms. Waters, as to what areas are in greatest
need. And the mayor has designated seven areas of development
that we need to be looking at. We have this mixed blessing of
tax-delinquent properties that we can redevelop into affordable
housing in the future. What I propose is greater cooperation
between government agencies, both Federal, State, and local, to
earmark funds to these different areas, and also a public-
private partnership that looks at working with CDCs and
developers. As has been said by the panel previously, this City
has been long an area for private development, where developers
have really taken a major role in the City. Unleash that power.
Work with nonprofits and see how we can develop communities,
not just low income but multi--mixed income communities where
we have middle income and higher income homes. We don't want to
stigmatize areas of the City as ghettos. In 10 years, nobody
will want to live in those areas, and we've wasted our time. So
how do we look at developing long-term neighborhoods that will
have a lasting effect.
Another thing you talked about was homelessness. In our
City, we did a poll to indicate that 12- to 14,000 individuals
every night are homeless. What we have found is that 35 percent
of those individuals have mental or physical ailments that do
not allow them to live independently in our City, and 55
percent need a structured environment where they can receive
the counseling that they need to get back on their feet, so it
is only 10 percent that are left in shelters. So while we're
looking at sheltering, we're not looking at the long-term
benefits. How do we get these people off this treadmill, not
just a bandage approach? Permanent housing is the answer.
Unfortunately, we have been producing very few permanent
housing units.
Mr. Celli talked about this one project, 175 units. That's
great. But we need 7,000 units if we're really going to address
our needs. So we're talking about project-based tax credits. We
talked about housing vouchers. Those are things that we need
because, otherwise, these projects are not feasible because
there's very low income, so no bank will finance these
projects.
We also need to be building capacity. There are only two
organizations in Houston that really develop SROs, the Housing
Corporation of Houston and the New Hope Housing. We need at
least five or six of these corporations. We need to have more
people who know how to do that. Catholic Charities, the
women's--so many groups would like to do it, and they don't
know how. We need to instruct them.
Education is the third point I want to reach, because I
know I'm running out of time. As mentioned by Mr. Bustamante,
we have a changing demographic in Houston, and many new
immigrants don't know about homeownership. I know there are
programs that have been raised up, but I look at the Vietnamese
community where we have had condominiums that have been
foreclosed upon because people didn't know their obligations to
maintain within that common structure. We've had, as Ms.
McElroy talked about, deed--contract for deed. So many
immigrants are coming who don't know how to purchase homes in
our community, not to mention subprime lending, which we all
know about, and first-time homebuyer programs, which many
people don't know about.
Finally, I'd like to just hit upon the Fair Housing Act.
One of things we're trying to develop in this community is
senior housing specifically geared towards certain communities
where there are special needs, such as the Vietnamese
community. We're going to be having a ground breaking this
afternoon for the Golden Bamboo Village, which will work with
the Vietnamese community. But we want to make sure the Fair
Housing Act does not inadvertently discriminate against
organizations that seek to meet special needs groups that are
not otherwise being enforced. So I thank you for this time, but
I know my time is up. I'm available to answer any questions you
have. Thank you.
Chairwoman Waters. Thank you very much.
A big round of applause for this panel. I'm going to kind
of forego what would be our traditional questions to say, we
get it. We get it. We understand. And all that has been
mentioned from this panel about funding, adequate funding for
housing survivors, and the extreme shortage of government-
subsidized housing, the mark-to-market program we just heard,
we're going to insist that all of those owners of those
buildings be paid and be paid on time, and that they be paid
fair market value for the rents. And we're working on that,
including moneys to help, you know, fix up some of those
places.
For the predatory lending, we have a big bill that we are
putting together. We know that there are people who should be
given prime loans but have been forced into the subprime
market. That market has collapsed because of all of the
reasons, greed mostly, that have taken place out there. And
we're now focused on trying to save some of these homes from
foreclosure. Housing discrimination is one of the shames of
this country, and we have to continue to work on it. I'm so
pleased that Mr. Green has presented us with legislation to
deal with housing discrimination in America and fair housing.
We understand what is going on. You have adequately described
the gentrification that is going on, and you are absolutely
right. The need for 7,000 units--I'm absolutely shocked at the
fact that there are only 4,000 public housing units here. I
hear what you're saying about the seven areas that have been
identified, the tax delinquent properties.
And I want to thank you all for reinforcing what we've
already come to understand, but we came here to have you
document what is going on at the invitation of Mr. Green. I
will yield time to Mr. Green and ask him to keep his comments
and his questions to a minimum so that we can get out on time.
Thank you very much.
Mr. Green. Thank you. I will be brief, but I do want to
thank you, Mr. Bustamante. In your testimony, you mentioned the
Housing Fairness Act of 2007. And just for edification
purposes, friends, we can end discrimination in housing in this
country. We really can. We can. The most efficacious tool that
we have available to us is something known as testing. Testing
works. When we can send our persons equally qualified of
different ethnicities or different stations in life, we can
find out who is performing this dastardly kind of behavior, and
we can catch them. We can catch them. But it takes not only an
act of Congress to do this; it takes a Congress willing to act.
That is what it takes.
And I assure you that this committee chaired by
Congresswoman Waters is willing to act. I have been very
grateful and benefited from her help with this Housing Fairness
Act. I just want to tell you that in that Act, we have $20
million annually from HUD--for HUD to administer nationwide
testing. We also have in that Act a requirement that HUD
presents a report to Congress on testing every 2 years--every 2
years--so that we can track what's happening as a result of
what we are doing. And we have other means by which NGOs can
get involved, and the NGOs can go out and do the testing and
bring lawsuits. The NGOs can test and also litigate to make
sure that, when we catch them, we can punish them. That must
happen.
And finally, to Ms. McElroy from ACORN. You mentioned
contracts for deed. Let me just share this with you. Some of
them are contracts for misdeeds. Many people find themselves
having made a long history of payments only to have what they
thought would be their home taken from them when they're right
near the point where they can purchase. So I share your
concern, and I assure you that is something that I will be
working with you and others on in the Congress of the United
States to see if we can make some corrections. I want to only
echo what the Congresswoman had said, ``From time to time it's
good to say amen.'' This is one of those days when we should
say, ``A woman, a woman, a woman.'' Thank you.
Chairwoman Waters. Thank you very much. Now Ms. Jackson
Lee.
Ms. Jackson Lee. Madam Chairwoman, let me thank you and
Congressman Green. And let me--because of the great panel--Mr.
Henneberger, Mr. Muhammad, Ms. Junor, Ms. McElroy, Mr.
Bustamante, and Mr. Quan, and I know Mr. Lopez was detained--
let me champion and thank Congresswoman Waters for recognizing
that we live in a diverse America. All of the amendments that
have been discriminatory relating to housing and immigrants
have been fought back by this chairwoman. And we have joined
her with Chairman Frank and Congressman Green, and we will
continue to do that.
Let me quickly do a few thank you's, and acknowledge the
presence of Mr. Love of the Coalition of the Homeless. I hope
he has been inspired today. I would also like to thank, in his
absence, Chad Bogany and Gerald Womack. Both of them are
leaders in the real estate area and they have fought these
issues of discriminatory housing. And we thank them. I want to
acknowledge Gladys House as well and just put on the record in
particular that the Gregory School received HUD-earmarked
dollars and the project is yet to be finished. We recognize
that.
Let me quickly just say not only do we get it, Ms. McElroy
and ACORN, I can't thank you enough. We're going to reignite
the battle on senior housing, particularly on the reverse
mortgages that Congressman Green--we'll all be working, but
also on the senior repair, which does not make sense. I want to
make sure that we reignite that fight. And I do want to put
into the record that we--Mr. Henneberger, if you would share
with us additional legislative fixes to help us, if you will--
and I'm going to get you to put it in the record, but to help
us overcome what has happened to Houston where they only have
4,000 public housing units when they should have more. I know
that you can think about it collectively.
And then would you also note that we--your point about
segregated housing. What we want to do, and I think what we
heard, people think the Third Ward is segregated, or the Fifth
Ward. But we want to come out and fix it up. We don't mind our
seniors and low incomes coming in, but let's have them have
beautiful properties. Let's get ACTION CDC to take up this
project that HUD has said where they can joint venture on the
Section 8. Let's let the CDCs build these facilities for
Section 8. I'd like to develop it, but let's get the CDCs to do
it.
I close, Madam Chairwoman with this: We are champions of
what our cities do. All we do is take back the message of our
cities. And so when you hear the term Houston HOPE, we champion
it. We think, in fact, that we have a wonderful effort because
it has Houston HOPE. But I want to put into the record, Edith
Salaville, 87 years old, at Weinburg & Delanore on the front
page of The Houston Chronicle. Her inherited property by a
historic civil rights leader in our community and she, I think
was a granddaughter, fell behind in property taxes after she
lost her senior exemption.
She was foreclosed on, an 87-year-old woman who lived in
this property under the pretense we can get these houses and
put them in Houston HOPE. We must have restraint and oversight
federally of a program that builds itself on foreclosures which
might catch up the elderly and the disabled. We want Houston
HOPE, but we want it to work in a nondiscriminatory fashion.
And so I am grateful for the presence of all of you here
today. And, again, I thank you, Madam Chairwoman, and
Congressman Green. I thank you for allowing me to participate
in this outstanding hearing. With that, I yield back.
Chairwoman Waters. Thank you very much. I'd like to thank
both Congressman Green and Congresswoman Jackson Lee for their
great advocacy and the time and attention that they put into
their work in Washington, D.C. I know there are days when many
of you have felt that there's no help coming, that Washington
is not doing what it should do. But I want to tell you that we
do have the gavel now, and it is going to make a difference. We
are going to use our power to correct some of these ills that
have existed for far too long. Again, I'm so pleased that Al
Green is on that committee doing such a great job. He is a
workhorse. He has a fabulous work ethic. And so I'm delighted
to be here. The Chair notes that some members may have
additional questions for this panel which they may wish to
submit in writing. And without objection, the hearing record
will remain open for 30 days for members to submit written
questions to these witnesses and to place their responses in
the record. I understand that there are some other things that
should be submitted for the record, and without objection, Mr.
Green first.
Mr. Green. We have these photographs, and I would ask that
the parties submitting the photographs give us a narrative that
will be placed in the record as well, if there are no
objections.
Chairwoman Waters. Yes. And also do you have any other
documents to submit, Ms. Lee?
Ms. Jackson Lee. Yes, Madam Chairwoman. I'll read it
because I have written on it. Just simply to announce again,
the Harris County Housing Authority that developed the disaster
housing process that may become a national model for disaster
housing assistance. And if there is anyone from Harris County
Housing, just raise their hand. I'm just putting that statement
in the record. Thank you very much.
Chairwoman Waters. Thank you very much. And I would also
like to submit for the record the written statements of the
Houston Center For Independent Living and historic Freedman's
Town and Allen Parkway Village as well as that of Mr. Malaika
Adan will be made part of the record. And if the young lady in
the back who submitted these being would raise her hand--oh,
I'm sorry--in the front, will raise your hand, and make sure we
get a narrative to go along with those pictures so that we can
put that in the record and have an opportunity to address what
you brought to our attention, I would appreciate it very much.
I'd like to thank all of you for being here. This is a
fantastic turnout for rather short notice to be here today. And
we really do appreciate it. You bring to us the support that we
need to be able to move forward. This hearing is adjourned.
Thank you very much.
[Whereupon, the hearing was adjourned.]
A P P E N D I X
October 29, 2007
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