[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
ACADEMIC PERSPECTIVES ON THE
FUTURE OF PUBLIC HOUSING
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON
HOUSING AND COMMUNITY OPPORTUNITY
OF THE
COMMITTEE ON FINANCIAL SERVICES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
FIRST SESSION
__________
JULY 29, 2009
__________
Printed for the use of the Committee on Financial Services
Serial No. 111-69
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HOUSE COMMITTEE ON FINANCIAL SERVICES
BARNEY FRANK, Massachusetts, Chairman
PAUL E. KANJORSKI, Pennsylvania SPENCER BACHUS, Alabama
MAXINE WATERS, California MICHAEL N. CASTLE, Delaware
CAROLYN B. MALONEY, New York PETER T. KING, New York
LUIS V. GUTIERREZ, Illinois EDWARD R. ROYCE, California
NYDIA M. VELAZQUEZ, New York FRANK D. LUCAS, Oklahoma
MELVIN L. WATT, North Carolina RON PAUL, Texas
GARY L. ACKERMAN, New York DONALD A. MANZULLO, Illinois
BRAD SHERMAN, California WALTER B. JONES, Jr., North
GREGORY W. MEEKS, New York Carolina
DENNIS MOORE, Kansas JUDY BIGGERT, Illinois
MICHAEL E. CAPUANO, Massachusetts GARY G. MILLER, California
RUBEN HINOJOSA, Texas SHELLEY MOORE CAPITO, West
WM. LACY CLAY, Missouri Virginia
CAROLYN McCARTHY, New York JEB HENSARLING, Texas
JOE BACA, California SCOTT GARRETT, New Jersey
STEPHEN F. LYNCH, Massachusetts J. GRESHAM BARRETT, South Carolina
BRAD MILLER, North Carolina JIM GERLACH, Pennsylvania
DAVID SCOTT, Georgia RANDY NEUGEBAUER, Texas
AL GREEN, Texas TOM PRICE, Georgia
EMANUEL CLEAVER, Missouri PATRICK T. McHENRY, North Carolina
MELISSA L. BEAN, Illinois JOHN CAMPBELL, California
GWEN MOORE, Wisconsin ADAM PUTNAM, Florida
PAUL W. HODES, New Hampshire MICHELE BACHMANN, Minnesota
KEITH ELLISON, Minnesota KENNY MARCHANT, Texas
RON KLEIN, Florida THADDEUS G. McCOTTER, Michigan
CHARLES A. WILSON, Ohio KEVIN McCARTHY, California
ED PERLMUTTER, Colorado BILL POSEY, Florida
JOE DONNELLY, Indiana LYNN JENKINS, Kansas
BILL FOSTER, Illinois CHRISTOPHER LEE, New York
ANDRE CARSON, Indiana ERIK PAULSEN, Minnesota
JACKIE SPEIER, California LEONARD LANCE, New Jersey
TRAVIS CHILDERS, Mississippi
WALT MINNICK, Idaho
JOHN ADLER, New Jersey
MARY JO KILROY, Ohio
STEVE DRIEHAUS, Ohio
SUZANNE KOSMAS, Florida
ALAN GRAYSON, Florida
JIM HIMES, Connecticut
GARY PETERS, Michigan
DAN MAFFEI, New York
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
STEPHEN F. LYNCH, Massachusetts Virginia
EMANUEL CLEAVER, Missouri THADDEUS G. McCOTTER, Michigan
AL GREEN, Texas JUDY BIGGERT, Illinois
WM. LACY CLAY, Missouri GARY G. MILLER, California
KEITH ELLISON, Minnesota RANDY NEUGEBAUER, Texas
JOE DONNELLY, Indiana WALTER B. JONES, Jr., North
MICHAEL E. CAPUANO, Massachusetts Carolina
PAUL E. KANJORSKI, Pennsylvania ADAM PUTNAM, Florida
LUIS V. GUTIERREZ, Illinois KENNY MARCHANT, Texas
STEVE DRIEHAUS, Ohio LYNN JENKINS, Kansas
MARY JO KILROY, Ohio CHRISTOPHER LEE, New York
JIM HIMES, Connecticut
DAN MAFFEI, New York
C O N T E N T S
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Page
Hearing held on:
July 29, 2009................................................ 1
Appendix:
July 29, 2009................................................ 37
WITNESSES
Wednesday, July 29, 2009
Boston, Dr. Thomas D., Professor, School of Economics, Georgia
Institute of Technology........................................ 5
Cabrera, Hon. Orlando J., Chief Executive Officer, National
Community Renaissance and Of Counsel to Nixon Peabody.......... 7
Fraser, Dr. James C., Associate Professor, Department of Human
and Organizational Development, Peabody College, Vanderbilt
University..................................................... 8
Goetz, Dr. Edward G., Director, Center for Urban and Regional
Affairs, and Professor, Urban and Regional Planning, Hubert H.
Humphrey Institute of Public Affairs, University of Minnesota.. 10
Harris, Dr. Laura E., Assistant Professor, Division of Public and
Nonprofit Administration, School of Urban Affairs and Public
Policy, University of Memphis.................................. 12
Jones, David R., Esq., President and Chief Executive Officer,
Community Service Society of New York.......................... 14
Joseph, Dr. Mark L., Assistant Professor, Mandel School of
Applied Social Sciences, Case Western Reserve University....... 16
Popkin, Dr. Susan J., Director, Program on Neighborhoods and
Youth Development, The Urban Institute......................... 17
APPENDIX
Prepared statements:
Boston, Dr. Thomas D......................................... 38
Cabrera, Hon. Orlando J...................................... 41
Fraser, Dr. James C.......................................... 49
Goetz, Dr. Edward............................................ 59
Harris, Dr. Laura E.......................................... 77
Jones, David R............................................... 88
Joseph, Dr. Mark L........................................... 94
Popkin, Dr. Susan J.......................................... 117
ACADEMIC PERSPECTIVES ON THE
FUTURE OF PUBLIC HOUSING
----------
Wednesday, July 29, 2009
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 10:07 a.m., in
room 2128, Rayburn House Office Building, Hon. Maxine Waters
[chairwoman of the subcommittee] presiding.
Members present: Representatives Waters, Lynch, Cleaver,
Green, Driehaus, Himes, Maffei; and Capito.
Chairwoman Waters. This hearing of the Subcommittee on
Housing and Community Opportunity will come to order.
Good morning, ladies and gentlemen. I would like to thank
the ranking member and other members of the Subcommittee on
Housing and Community Opportunity for joining me today for this
hearing on academic perspectives on the future of public
housing. Public housing plays an important role in providing
affordable rental housing for 1.2 million households,
containing about 3 million individuals.
In fact, research suggests that residents of public housing
fare better across a number of measures than households at
similar income levels who live in private market apartments
without housing assistance. Despite the many successes of
public housing, some critics continue to associate the program
only with problems. These perceptions of public housing have
led some public housing authorities to push for the continued
demolition of public housing units.
The Center on Budget and Policy Priorities estimates since
1995, 200,000 public housing units, including the great
majority of large high-rises have already been torn down, just
as yesterday the Associated Press reported that the City of
Atlanta is in the process of demolishing the last of its public
housing, making it both the first city to have public housing
and the first major city to eliminate it. These negative
perceptions of public housing also helped fuel disinvestments
in the program over the last 8 years.
For too long, our Federal housing policy said that
homeownership was a one-size-fits-all approach for all
households and neglected the important need that public housing
fills for some individuals and families. Year after year, our
Federal budgets reflected these priorities. Beginning in 2003,
the Federal Government underfunded the public housing operating
fund for 6 consecutive years. The public housing capital fund
has also fallen well short of need in recent years.
Where estimates vary, the Center on Budget and Public
Policy priorities estimates the cost of needed repairs and
modest upgrades at $22 billion. As the current Administration
begins to reverse the trend of underfunding the program, I
believe that now is the time to look at how the current program
can be improved, so that it best serves the needs of low-income
families.
First, we must address the loss of units throughout the
country. The HOPE VI Program has accelerated the demolition of
public housing, leading to a net loss of at least 50,000 units.
That is why last year I introduced in the House, and the House
passed, a HOPE VI reauthorization bill that required one-for-
one replacement. In addition, Chairman Frank and I recently
wrote to Secretary Donovan to request a one-year moratorium on
all public housing demolitions.
I am also troubled by resident displacement and the low
rates of return among original public housing tenants.
Additionally, I believe we need to build-up the record of HOPE
VI and reconsider how well public housing programs meet the
needs of different types of residents. In particular, I am
concerned about whether we are adequately serving the most
vulnerable public housing residents, including elderly and
disabled residents, families with children, and included in
that ex-offenders.
More needs to be done to ensure that housing is connected
to job opportunities, affordable healthcare, and
transportation. We also need to improve upon how public housing
agencies and nonprofits work together to provide case
management services to residents of all ages by grounds and
levels of need. This case management needs to continue through
the life of the development and it needs to effectively target
residents who relocate with vouchers. It is time to rethink the
way that residents are involved in the process of governing
their communities, particularly when redevelopment takes place.
This includes helping residents access job opportunities right
in their own backyards and ensuring that they can advocate for
how their communities are designed.
I am pleased that our witnesses are here today to comment
on these issues. There are many questions we have yet to answer
on these important topics and I look forward to our witnesses'
testimony.
I thank you, and I would now like to recognize our ranking
member, Ranking Member Capito, for 5 minutes for an opening
statement.
Mrs. Capito. Thank you, Madam Chairwoman. And I want to
thank the witnesses today for coming before us. I don't have a
formal opening statement. I just have a couple of things I
would like to say, and I also want to apologize. I have to go
to the Floor to manage two or three suspensions, so I might be
in and out during the committee hearing.
At this point in time, I think it's well-placed to be
looking at the future of public housing and how we can best use
our resources. Right now at this moment, Federal spending on
public housing is at an all-time high. When you combine the
consolidated appropriations with the stimulus package, it's
quite sizeable, and certainly the same can be said for the HUD
appropriations bill that was passed last week.
I think it's important as we look at more dollars that we
do this in a smart and efficient way, and one of the things I
have learned through service on this committee in talking with
my local housing folks is that some flexibility needs to be
built into the program. So, as the chairwoman said, a one-size-
fits-all approach no longer fits the housing authorities and
the others who are in the position to make decisions.
That's why we did our Section 8, the Moving to Work
revisions I think were good because of the flexibility we built
in there, and I would like to see us build flexibility into our
public housing programs as well. I think that innovative
solutions are what we are looking for today, and I'm certain
most of you have great ideas on that in terms of how to reach
our vulnerable populations, whether it's our elderly or
disabled from my perspective representing a rural State.
I think it's important too that we realize that rural
America has great housing needs, maybe not in the greater
numbers. But as a lot of our aging population lives in the
rural area, certainly in my State, we need to be able to help
them meet the challenges they have as they move into their
elderly years and make sure that they are in safe, affordable
housing. I have also noticed in my own community of Charleston,
West Virginia, when we have tried to reshape the face of public
housing, that a lot of the housing units were clustered
together intensely, and have come into quite disrepair, because
of the age, basically, of the units. And I think our housing
authority has done a wonderful job in terms of reshaping the
face of public housing in our community, but I think they have
been able to use some flexibility in terms of not necessarily a
one-to-one replacement in that exact locality but spread those
units around the different city and area to make sure the units
are there, but they are not as heavily concentrated as they had
been in the past.
And one of the aspects I think it's important that we
emphasize too, is as we rebuild and renovate units, that we do
this in a smart and efficient way to use our dollars the best,
and that's to make sure we build an energy efficiency and the
green standards I think will help drive cost savings, but also
be a smarter way to use our dollars.
So with that I would like to thank the chairwoman for
having this hearing and I look forward to the testimony of our
witnesses.
Thank you.
Chairwoman Waters. Thank you very much.
Mr. Lynch is now recognized for 5 minutes.
Mr. Lynch. Thank you, Madam Chairwoman.
I appreciate you holding this hearing and I appreciate your
longstanding advocacy on behalf of families living in public
housing. I would also like to welcome our panelists and I thank
them in advance for their testimony on this very important
issue.
As someone who was raised in public housing in the housing
projects in South Boston, I understand the important role that
public housing can provide for families and the community at
large. Federally-subsidized public housing provides homes for
about 3 million Americans living in 1.2 million households
today, but we know that our public housing stock is
insufficient and more units are necessary.
Prior to coming to Congress, I worked as a young lawyer. I
did pro bono work in the housing projects in the City of Boston
representing families living in public housing, who were having
trouble with lead paint on the pipes, asbestos in the
apartments. Folks who were underhoused, a lot of kids living in
apartments with maybe one bedroom. So I know the strain that's
facing a lot of families in public housing. Many factors have
contributed to a shortage of public housing, including
insufficient Federal funding and the demolition of aging units
without replacements, as Chairwoman Waters has mentioned.
This committee has received testimony at previous hearings,
and I have heard from the public housing community in my
district, that public housing agencies lack sufficient staff
and resources to perform inspections and maintain aging
buildings. It is especially stressful in larger urban areas,
including some cities in the Northeast, such as in my district
in Boston, where the housing stock is older than in many parts
of the country.
We know that additional maintenance and inspections are
necessary to ensure tenants' safety and the proper allocation
of Federal resources.
The lasting questions related to public housing are
grounded in how to best use affordable housing as a platform
for families' stability and independence. Research has
supported the idea that a stable, safe, and clean place to live
can serve as the foundation for self-sufficiency. And as we
enter into a new phase of federally-subsidized housing, I am
interested in hearing more about the many approaches to the
future of public housing intervention, whether it's a
continuation of the mobility-based, mixed-income models that
have helped transform old high-rises into revitalized
communities or the prioritization of housing preservation for
certain populations like the disabled and elderly.
I look forward to hearing from our panelists on these
ideas. I want to thank you, Madam Chairwoman, again for your
advocacy on this issue and for convening this hearing. And I
yield back the balance of my time.
Chairwoman Waters. Thank you very much.
Mr. Himes, would you like to make an opening statement? If
not, we will move to our witnesses. Again, we want to thank you
for being here today. We will recognize you each for 5 minutes,
and we will begin with our first witness, Dr. Thomas Boston,
professor, School of Economics, Georgia Institute of
Technology.
Our second witness will be the Honorable Orlando Cabrera,
CEO, National Community Renaissance and Of Counsel to Nixon
Peabody.
Our third witness will be Dr. James Fraser, associate
professor, Department of Human and Organizational Development,
Vanderbilt University.
Our fourth witness will be Dr. Edward Goetz, director,
Center for Urban and Regional Affairs, University of Minnesota.
Our fifth witness will be Dr. Laura Harris, assistant
professor, School of Urban Affairs and Public Policy,
University of Memphis.
Our sixth witness will be Mr. David Jones, president and
CEO, Community Service Society of New York.
Our seventh witness will be Dr. Mark Joseph, assistant
professor, Mandel School of Applied Social Sciences, Case
Western Reserve University.
And our eighth witness will be Dr. Susan Popkin, director,
Program on Neighborhoods and Youth Development, The Urban
Institute.
Without objection, your written statements will be made a
part of the record. You will be now be recognized for a 5-
minute summary of your testimony.
Thank you. Starting with you, Dr. Boston.
STATEMENT OF DR. THOMAS D. BOSTON, PROFESSOR, SCHOOL OF
ECONOMICS, GEORGIA INSTITUTE OF TECHNOLOGY
Mr. Boston. Thank you, Madam Chairwoman, and the honorable
and distinguished members of the subcommittee.
Your invitation letter asked me to answer eight specific
questions related to my research on the Atlanta Housing
Authority, and I will restrict my answers to those questions.
And let me start simply by summarizing my research findings,
and that is that when low-income housing-assisted families are
given access to quality affordable housing in neighborhoods of
greater opportunity, their self-sufficiency increases
significantly.
The first question I was asked to respond to was to
describe my research on public housing in Atlanta. I have
mainly focused on how mixed-income revitalization, housing
choice vouchers, and public housing have affected family self-
sufficiency. I have examined 20,000 administrative records of
families who received housing assistance from the Atlanta
Housing Authority between 1995 and 2007, and, more recently, I
completed an examination of 26,000 families who received
housing assistance from the Chicago Housing Authority between
1999 and 2007.
I have attempted to answer the following questions: Did
families relocate to better neighborhoods when the housing
projects they lived in were demolished? Did they lose housing
assistance? Did mixed-income developments or vouchers improve
self-sufficiency in comparison to housing projects? Did the
benefits of mixed-income revitalization exceed the cost?
Finally, did the performance of elementary kids improve if
their families had access to vouchers or lived in mixed-income
developments?
Next, I was asked to describe the transformation efforts in
Atlanta. Between 1995 and 2007, Atlanta fully constructed 13
mixed-income developments, more than any other housing
authority in the country. In 1995, Atlanta provided housing
assistance to over 16,000 families, 47 percent of whom lived in
public housing projects, and 33 percent of whom used the
vouchers.
By 2007, Atlanta provided housing assistance to over 17,000
families, 15 percent of whom lived in public housing projects,
and 59 percent of whom used vouchers. And then, another 90
percent lived in mixed-income developments and I am leaving
aside in those percentages the elderly families.
What are the re-screening policies of AHA and what
percentage of original public housing residents moved back into
the redeveloped communities? Madam Chairwoman, I cannot speak
authoritatively on the re-screening policies. I do know that
those policies, those re-screening processes were handled by
private development companies, and I would have to defer to the
management of the authority in regards to a more authoritative
answer to that. But with regard to the second question that I
have examined in detail, my research found that in Atlanta,
21.4 percent of the still-active original families moved back
into mixed-income developments, and about 61 percent used
vouchers.
I have also found through numerous focus group interviews
that the large percentage of families who remain on vouchers do
so primarily by choice. My statistical research in Atlanta also
found that mixed-income revitalization did not cause families
to lose housing assistance.
The next question I was asked is in what way have I updated
my 2005 article that was published in the Journal of the
American Planning Association. And I would simply say that I
conducted a number of updates to that study, including
extending it over a period of time. I have added a study of
Chicago. I have looked at issues of the association between
voucher locations and crime. I have done cost-benefit analyses,
and so on. The most important update has been the addition of
the Chicago Housing Authority that was funded by a grant from
the McArthur Foundation, and that is a 300-page report that is
currently undergoing peer review. Here are the findings:
First, I found that families who relocated--and this is
specifically with respect to Atlanta--from public housing
projects moved to much better neighborhoods. We looked at 16
community metrics to evaluate that. Second, we found that the
employment rates of work eligible adults increased from 21
percent in 1995, when most families lived in public housing
projects, to an average of 53 percent in 2007, when most
families had moved away from those projects. And we tracked
families longitudinally.
On nationally standardized tests we found that: kids whose
families lived in housing projects scored very low, in the 29th
percentile nationally; those whose families used vouchers
scored slightly higher, in the 35th percentile nationally; and
those whose families lived in mixed-income developments scored
higher, in the 43rd percentile. All of these, of course, are
much lower than we would like to see them. And, the most
important point is that the vouchers in mixed-income
developments provided access to better schools.
Violent crime was not significantly correlated with the
percentage of families who lived in census tracts. It was,
however, highly correlated with the poverty rate in census
tracks. And, finally, we found that the net social benefit of
revitalizing 6 public housing projects in Atlanta was $125
million per development, our benefit cost ratio of 1.6 to 1.
Let me end simply by saying that my research in Atlanta has
demonstrated conclusively that the self-sufficiency of low-
income families can improve significantly if those families are
provided access to quality, affordable housing in neighborhoods
where the opportunities for upward mobility are greater.
Thank you very much.
[The prepared statement of Dr. Boston can be found on page
38 of the appendix.]
Chairwoman Waters. Thank you very much.
Now, we will go to Mr. Cabrera.
STATEMENT OF THE HONORABLE ORLANDO J. CABRERA, CHIEF EXECUTIVE
OFFICER, NATIONAL COMMUNITY RENAISSANCE AND OF COUNSEL TO NIXON
PEABODY
Mr. Cabrera. Thank you, Madam Chairwoman.
Good morning, Chairwoman Waters, Ranking Member Capito, and
members of the subcommittee.
My name is Orlando Cabrera and I wanted to thank you, Madam
Chairwoman, and Ranking Member Capito for your invitation to
speak this morning. Madam Chairwoman, I ask that my written
comments be entered and accepted into the record.
Chairwoman Waters. Without objection, it is so ordered.
Mr. Cabrera. In light of present company, I feel compelled
to state that I am not an academic. Further, most of my
comments are tailored to the world of the PHA, the housing
provider. There are some axioms in the world of public housing;
and, one of them is that public housing is at a crossroads, and
that's because public housing is always at a crossroads. There
are pretty basic reasons for that being the case. The first and
foremost reason is that our country is always changing.
That is no different today. Public housing policy has
always been interesting because it's a terrific indicator of
where our country is. Public housing was very important to
returning veterans during World War II and it's going to be
very important to the elderly, right now, frankly, with our
aging population. We're going to see demand increased for
public housing and more accurately for affordable housing. And
one of the very large issues facing the issue of public housing
is how we look at housing.
Public housing has always been treated as something that is
outside of the housing spectrum. It is another theory I
disagree with strongly. I think public housing is well within
the housing spectrum and needs to be considered within the
housing spectrum. Moreover, the focus, I believe, for many
housing practitioners is the issue of affordable housing, and,
what is the supply of affordable housing? How is that supply
helping those who need it most?
No place is that reality more acute than in the world of
elderly housing; and no place will it be more acute in our
lifetimes, I believe, with the state of our aging population.
Another large issue for PHAs is the changing nature of our
Nation's demographics. Much of our public housing stock was
developed at a time when the population center was located in
the Northeast. Things are changing remarkably. The modality for
housing in the places where it's changing has typically not
been public housing. It has been for the last 30-plus years
Section 8. So issues that are very important to the Northeast
and rightly important, such as public housing and the
obsolescence of public housing, are far less important to
places in the West than in the South where vouchers are the
typical modality for housing people who have the need to be
housed. This is going to drive a lot of the conversation, but
it begs a big question, which is why we have typically treated
public housing in a particular way. We have decided long ago
that public housing, and this is not a one-size fits all
argument, but public housing is a particular kind of program.
The truth is that, from a practitioner's perspective,
public housing is one part of a very large spectrum that fits a
lot of needs, and that spectrum deals with its needs in
different ways in different parts of the country. The driver
here is always going to be whether the local government has the
flexibility to function in order to address the needs of its
particular community. In the Northeast it's going to be
different than in West Virginia or in Los Angeles, or for that
matter in San Bernardino, which is just 40 miles to the East of
Los Angeles.
That driver is going to dictate a lot of how we deal with
the issue of affordable housing generally and the subset of
public housing. Very quickly, there is a tangential issue that
I promise you no one--none of my formal professional colleagues
at HUD--asked me to do this, but I'm going to do this
shamelessly. A big part of trying to determine the future of
public housing is probably funding technology at HUD. Public
housing is driven by data, and data currently is kept at HUD in
ways that would be a technological generation ago--a lot of
Excel spreadsheets. There are currently applications that will
make the business of keeping data much easier, would serve
Congress well, would serve HUD well, would serve PHAs well, and
would serve tenants well.
I would ask Congress to think about funding a solid,
technological platform for HUD to provide that data to all of
us, to the American taxpayer, to PHAs, to this Congress, and to
tenants.
With that, Madam Chairwoman, and Ranking Member Capito,
thank you for your time. Thank you for the invitation, and I
stand ready to answer any questions you might have.
[The prepared statement of Mr. Cabrera can be found on page
41 of the appendix.]
Chairwoman Waters. Thank you very much.
Dr. James Fraser?
STATEMENT OF DR. JAMES C. FRASER, ASSOCIATE PROFESSOR,
DEPARTMENT OF HUMAN AND ORGANIZATIONAL DEVELOPMENT, PEABODY
COLLEGE, VANDERBILT UNIVERSITY
Mr. Fraser. Good morning, Madam Chairwoman, Ranking Member
Capito, and distinguished members of the subcommittee. Thank
you for this opportunity to testify today.
For more than a decade, I have been involved as evaluator
in a variety of HOPE VI and mixed-income housing programs
around the southeastern United States, I have also been a part
of the active community of scholars who share scientific
findings with each other. Today, I draw on all of these to
testify.
One of the most noteworthy aspects of the HOPE VI Program
is that it addressed both place-based goals around neighborhood
revitalization and people-based goals around economic self-
sufficiency, wealth accumulation, and general wellbeing. Among
the most important lessons that we have learned from HOPE VI is
that any policy utilizing such a dual focus requires as much
planning, professionalism, and follow-through to create the
enabling conditions for people to move up and out of poverty as
it does to change the landscape by building housing and
providing increased police patrol.
Research shows that HOPE VI has been very successful in
most cases in providing decent, affordable housing that is
attractive and suits the needs of many low-income families. My
own research in Durham, North Carolina, and in Nashville,
Tennessee, show that residents are generally very satisfied and
appreciate safe, affordable, quality housing. Likewise,
research across the country does point to the fact that people
who are able to qualify to move back into HOPE VI
redevelopments actually do experience a better environment
living where there's less crime, whether that be their
perceptions or actual police records showing that it is
decreased.
However, people are not all benefiting equally for two
reasons. First, even when stakeholders claim that they equally
support place-based goals and people-based goals, the place-
based goals typically outpace people-based goals. And, second,
HOPE VI has been geared for a specific type of low-income
citizen, namely, those who have clear paths in mind to achieve
their goals, access to decent paying jobs, relatively few
barriers in their way, and they view HOPE VI as providing
quality, income stabilized housing as a stepping stone on their
journey. But we know the evidence suggests the large majority
of people in poverty do not fall into this category.
Many low-income families live in isolated poverty with
multiple barriers to work and a lack of access to living wage
jobs. Indeed, HOPE VI was designed to deal with this issue
through the creation of mixed-income communities. But today I
would contend there is little, if any, direct evidence, that
shows that living in a mixed-income community has actually
empowered low-income residents to move toward economic self-
sufficiency.
Certainly, living and having access to quality affordable
housing has helped that, but living near middle-income families
has not been shown to do that to-date. These findings have
prompted some people to suggest that we are expecting too much
out of a program like HOPE VI, that we could do better, or that
we should just not expect that people would move up and out of
poverty in such a way. But, my research and my review of the
literature shows that perhaps part of the issue is that we
haven't provided the authority to the people that we're trying
to help to actually make decisions about the communities being
built.
HOPE VI families do have quality housing, but broader
achievement around people in place-based goals of neighborhood
revitalization and increases in economic status have not been
realized. And, if residents through community-based
organizations had more control over their homes and
neighborhoods as well as the authority to lead and design HOPE
VI type neighborhood initiatives, it is likely these goal sets
would be addressed in a manner that mirrored the actual needs
of the people who are the stakeholders, the low-income
residents.
It is not my intention to say that public housing
authorities are not capable of meeting the goals of HOPE VI.
Rather, I suggest that we are asking too much of them. Let them
build on their strengths, which are frequently related to
developing and managing housing and other physical assets, and
let us instead turn to residents and community-based
organizations to lead the public, private, and non-private
sectors toward the intertwined goals of neighborhood
transformation and upward economic momentum for low-income
residents.
I have assembled policy suggestions that do stem from
different research projects, and I'll state a few right now.
First, thinking about the choice neighborhoods legislation that
will be considered, perhaps entities other than public housing
authorities could be considered to be the recipients.
Community-based organizations have long-standing relationships
with public and private organizations that have a track record
of getting things done.
The second, in terms of governance of these types of
initiatives, residents do much better when they come to a table
on equal footing. Too often, I heard stories from HOPE VI where
residents were asked to choose paint colors and give their
feelings or input about the relocation process. But when it
came down to the actual decision-making, they were not at the
table. So I concluded that their range of policy suggestions, I
suggest around this, that might be able to empower residents to
engender greater commitment toward the communities and
neighborhoods we're building and create the sustainability
we're looking for with the large public investment that is
outlayed.
Thank you.
[The prepared statement of Dr. Fraser can be found on page
49 of the appendix.]
Chairwoman Waters. Thank you very much.
Dr. Edward Goetz.
STATEMENT OF DR. EDWARD G. GOETZ, DIRECTOR, CENTER FOR URBAN
AND REGIONAL AFFAIRS, AND PROFESSOR, URBAN AND REGIONAL
PLANNING, HUBERT H. HUMPHREY INSTITUTE OF PUBLIC AFFAIRS,
UNIVERSITY OF MINNESOTA
Mr. Goetz. Thank you, Madam Chairwoman, and members of the
committee.
I appreciate the opportunity to provide this testimony
today. As Dr. Fraser noted, the HOPE VI Program is designed to
create two general types of benefits. The first is the
community-wide benefits. It is envisioned that HOPE VI
redevelopment will result in an increase in property values,
attraction of greater levels of private sector investment, an
improved neighborhood environment, a reduction in crime, and so
on.
The program is also designed to provide individual level
benefits for the residents of the public housing. The idea here
is that by relocating the better neighborhoods while moving
into the finished redevelopment that these residents will have
a reduced fear of crime and reduced risk of victimization. They
may even experience increased physical health, mental health,
and will achieve greater economic self-sufficiency.
The academic research to-date shows a fair amount of
success, an impressive amount of success on the first of these
objectives, these community-wide benefits. Studies across the
country have shown that crime is reduced in neighborhoods that
have undergone HOPE VI transformation, unemployment drops,
incomes in the neighborhood rise. poverty declines, there is an
overall increase in the level of education in the neighborhood,
and property values increase.
The only caveat to these generally very positive outcomes
is that most of them are dependent upon population turnover.
That is income is increased in the neighborhood and levels of
education increase, not because the existing residents have
improved their lot, but because those residents have been
replaced by more highly-educated and higher-income people.
At the individual level, the research is much more mixed
and the evidence of benefits to individuals is much more
modest. On the positive side, virtually all studies show
consistent and strong benefits in the form of a reduced fear of
crime. Residents report less evidence of social disorder. They
report higher satisfaction with housing conditions, with the
exception of cost in most cases. But, otherwise, the evidence
is really quite mixed. There is the predominance of evidence
shows no demonstrated benefits on employment, on earnings, on
economic self-sufficiency.
In fact, there is even evidence of greater economic
insecurity among families who are displaced through HOPE VI
redevelopment. There is no consistent evidence of health
improvements. This comes from the largest study in this respect
is the Urban Institute's five-city panel study. There is no
consistent evidence of school-related benefits for children.
There are mixed findings related to neighborhood satisfaction.
Some residents are more satisfied in their new
neighborhoods. Some are less satisfied. Some residents are more
satisfied with certain dimensions of their new neighborhood and
less satisfied with others. There are significant and
consistent findings, however, that displacement through HOPE VI
disrupts the social networks and the social support systems of
lower-income public housing families.
They experience, and their children tend to report, greater
levels of social isolation, fewer interactions with neighbors
in their new neighborhoods, a loss of a sense of community, and
damage to the overall social capital. These limited individual
benefits are problematic in and of themselves. I think they are
more problematic because of my current research, which shows
that HOPE VI and public housing demolition in general tend to
target projects with disproportionately high percentages of
African-American residents in them. So my recommendations going
forward, these results I think suggest a number of different
changes in direction.
The first would be to stop further demolition of public
housing. As you noted in your opening remarks, HUD has
demolished close to 200,000 units of public housing over the
last 15 to 20 years. That's more than twice the number of units
that the Commission that led to the creation of HOPE VI
identified as being severely distressed. As we continue to tear
down public housing through HOPE VI, we tend to tear down units
and projects that are more and more functional over time, and
this is reflected in the evidence of residents who are asked
whether they want to move, the majority of whom say no.
I would also suggest that given the positive outcomes of
the physical redevelopment in HOPE VI neighborhoods that we
have perhaps come upon a good model for building more
affordable housing. So far from continuing to tear down public
housing, we should use the lessons of HOPE VI to actually
expand public housing. We can build it in a mixed-finance and a
mixed-income manner, and we can be expanding the stock of
affordable housing. The demand for it, of course, still exists.
Any redevelopment policies going forward should limit
displacement of families to all extent possible. This means
favoring rehabilitation over demolition. It means phased
redevelopment. It means building replacement housing before
demolition takes place and then, finally, for a percentage of
residents of public housing, the evidence shows those who
benefit the most from voluntary, enforced displacement are
those who wanted to move in the first place.
And so Federal policy should maintain an option for people
who want to move out of public housing. Voluntary mobility
programs like Moving to Opportunity should be continued and
expanded in order to provide that opportunity.
[The prepared statement of Dr. Goetz can be found on page
59 of the appendix.]
Chairwoman Waters. Thank you very much.
Dr. Harris?
STATEMENT OF DR. LAURA E. HARRIS, ASSISTANT PROFESSOR, DIVISION
OF PUBLIC AND NONPROFIT ADMINISTRATION, SCHOOL OF URBAN AFFAIRS
AND PUBLIC POLICY, UNIVERSITY OF MEMPHIS
Ms. Harris. Good morning, Madam Chairwoman, Ranking Member
Capito, and distinguished members of the subcommittee. Based on
my research experiences, this testimony addresses the questions
posed in the invitation letter I received for this hearing.
I have submitted a more lengthy written testimony to the
subcommittee, but here I'll focus on describing the case
management system in Memphis and lessons for future policy.
Case management to help new residents toward employment and
economic self-sufficiency is a key part of the HOPE VI Program,
typically by referring residents to existing community
programs.
In the past few years, there has been a tremendous
evolution in this case management system used in Memphis based
on experiences with two early HOPE VI grants they received.
While these early grants maintain compliance with HOPE VI
guidelines, they did not achieve the desired change of
significant progress toward economic self-sufficiency for many
residents, which was the ultimate goal.
By the time the Memphis Housing Authority received its
third and fourth HOPE VI grants in 2002 and 2005, there were
local stakeholders, including the Housing Authority, who saw
that there needed to be a more structured, intensive, and
comprehensive case management system in place to help
households move toward self-sufficiency. The most important
stakeholder to become involved in the HOPE VI redevelopment
efforts was the Women's Foundation for Greater Memphis, who
made a financial commitment of $7.2 million to support the
entire case management program for these 2 cities for 5 years
for approximately 600 families.
During this time, the Memphis Housing Authority identified
urban strategies as a key partner in providing technical
assistance to this case management program, helping plan and
coordinate community development programs. In 2006, Urban
Strategies, the Memphis Housing Authority, and the Women's
Foundation together agreed to the creation of a new nonprofit
called Memphis HOPE, which is now the entity responsible for
case management for HOPE VI residents.
One key lesson from much HOPE VI research has been that
many adults need far more than referrals to job training
programs or encouragement in order to get a job. In my written
testimony, I describe three key barriers that public housing
residents in Memphis and elsewhere face when trying to improve
their economic situation: low levels of education and literacy
problems; health problems that are undiagnosed, not managed
well, or do not meet Federal guidelines as disabilities in
order to receive assistance; and a lack of personal or
accessible public transportation.
In thinking about the lessons from HOPE VI, there are five
issues that should be considered in crafting future Federal
policy for public housing residents and other very poor
households. First, in programs like this, identify a strong
intermediary who will advocate throughout the local community
for the needs of this client population in the redeveloping
neighborhood. In Memphis, the Women's Foundation and local
foundations have made a commitment to see long-term change,
continually asking for evidence of change and plans for
sustainability after the initial 5-year case management period
ends. Many in the local community now view this Memphis HOPE
model as an incubator for creative ideas about how to affect
real change for poor households.
Second, following on this first point, figure out how to
work around the program funding silos which make comprehensive
case management and redevelopment efforts difficult. In
Memphis, the local funding through the efforts of the Women's
Foundation and the creation of this third-party nonprofit have
made it possible to react quickly to create programs as they
identify program gaps for their case load.
Third, ensure that the program starts to make plans early
on to figure out how case management will be sustainable for
HOPE VI clients wherever they live. In particular, the presence
or absence of case management services may affect the long-term
viability of these newly developed mixed-income HOPE VI sites.
For example, at one of the earlier HOPE VI sites that is now
mostly redeveloped, property managers have reported that in the
last year since HOPE VI case management stopped there, there
has been an increase in the number of public housing residents
losing their jobs and facing eviction. There is concern at this
site and others that particularly during the current economic
climate, more residents will lose employment and face some more
circumstances. There is a need for ongoing case management if
this vision of creating mixed-income communities where public
housing residents live is to be truly viable.
Fourth, make sure that grantees are realistic from the
start about the goals for their client population, by
understanding the depth of literacy problems, mental and
physical health problems, and other barriers to employment and
self-sufficiency. After more than a decade of Welfare to Work
era efforts, including HOPE VI case management, there is a much
better understanding about the types of issues to look for and
plan for.
Finally, encourage grant recipients to capitalize on
creative approaches to identify local partnerships for client
employment. I go into more detail in my written testimony about
this, using a very innovative approach. They work to create
individual relationships with both large and small area
employers to help open doors for clients who are qualified for
work. They have chosen to target opportunities where clients
might move ahead and ultimately become economically self-
sufficient, rather than merely focusing on quickly locating
minimum wage service sector jobs. These recommendations suggest
that both the system of service delivery and the content of
those services should be examined to ensure that programs can
be as efficient as possible in helping move poor individuals
toward economic self-sufficiency as appropriate.
Thank you.
[The prepared statement of Dr. Harris can be found on page
77 of the appendix.]
Chairwoman Waters. Thank you very much.
Mr. Jones?
STATEMENT OF DAVID R. JONES, ESQ., PRESIDENT AND CHIEF
EXECUTIVE OFFICER, COMMUNITY SERVICE SOCIETY OF NEW YORK
Mr. Jones. Thank you, Madam Chairwoman, and honorable
members of the committee. Thank you for inviting me to testify
on the future of public housing, particularly in regard to the
New York City Housing Authority's (NYCHA) implementation of
something called Section 3 of the 1968 Housing Act, which
requires that HUD funds be used to maximize job and training
opportunities for low-income residents.
My organization, the Community Service Society, has long
been concerned about the scale and effectiveness of local
Section 3 efforts by the New York City Housing Authority. As a
more than 160-year-old organization, we were one of the first
to address urban poverty in America. We founded the Columbia of
Social Work, and for those visiting New York, the first public
baths. But our work recently has focused on labor force issues
in New York, particularly concerning black males and
disconnected youth.
To place New York's experience in context, it should be
noted that the New York City Housing Authority runs the largest
and reputedly one of the best housing authorities in the
Nation. It serves over 180,000 households in 340 developments
across the 5 Boroughs of the City. With a resident population
in that complex of 500,000, its size comes closer to matching
some major cities in America and it represents, I think,
somewhat over a quarter of the total population of residents in
public housing.
In contrast to other areas, low-income families are
desperate to get into public housing in New York. We have a
waiting list that well exceeds 100,000 and waits as long as 9
years are not uncommon for people waiting to get in. NYCHA
receives more than $1 billion in HUD funds each year, which are
spent on management operations and capital improvements. And,
this year, NYCHA has already received 423 million additional
economic and stimulus funds, which opens up further
opportunities. In short, NYCHA is a major economic engine
within the City of New York and we have a good reason to expect
Section 3 efforts to be significant.
But, we find it falls short of providing economic
opportunity to residents at a size comparable to the
expenditure. In our latest housing policy report that we have
submitted to the committee making the connection, economic
opportunity for public housing residents, we find that only 51
percent of NYCHA's 231,000 working age residents participated
in the labor force in 2005. Another 13 percent were engaged in
school or training.
We estimate at present, and this is probably a low
estimate, that between 20- and 30,000 residents are unemployed,
and now actively seeking work in a recession. Our economy can
serve the worse since the Great Depression of the 1930's. We
have some reason to believe from our experts that unemployment
rates for Blacks and Latinos in New York may well top-out in
2011, somewhere in the vicinity of 20 percent. So we're coming
into an enormously bad time.
Most in the Housing Authority in New York are Black and
Latino women--62 percent--many under age 24; or Black and
Latino men between 18 and 34. Over a third don't have high
school diplomas. As our report indicates, the Authority's
Section 3 effort is ridiculously small compared to the number
of potential jobseekers in NYCHA communities. For that reason,
CSS supports the Earnings and Living Opportunities Act being
drafted by Congresswoman Nydia Velazquez, because it will
strengthen existing Section 3 provisions in several ways.
It accords, first, hiring-training priorities to residents
in developments where head funds are being expended and then to
those in the broader community around those developments. It
essentially incentivizes and makes it possible for residents to
watch as enormous investment goes on in their community and sit
around; and none of those jobs are available. This becomes an
intolerable situation.
It provides a private right of action that enables
aggrieved parties to take legal action against agencies or
contractors, and New York, as you may be aware, has a long
history of discriminatory behavior in the trades. It sharpens
the requirements for hiring and training for agencies and
contractors receiving HUD funds. It creates a Section 3 office
within the Office of the HUD Secretary, and it increases local
accountability.
Moreover, we urge congressional drafters to incorporate
real incentives for housing authorities to intensify Section 3
efforts. The proposed legislation speaks to performance
incentives that can be instituted by the HUD Secretary. I'll
close there.
[The prepared statement of Mr. Jones can be found on page
88 of the appendix.]
Chairwoman Waters. Thank you very much.
Mr. Joseph.
STATEMENT OF DR. MARK L. JOSEPH, ASSISTANT PROFESSOR, MANDEL
SCHOOL OF APPLIED SOCIAL SCIENCES, CASE WESTERN RESERVE
UNIVERSITY
Mr. Joseph. Madam Chairwoman, members of the subcommittee,
thank you for the invitation to speak before you today.
Secretary Donovan has said that building communities in a
more integrated and inclusive way is essential to advancing
social and economic justice in America. The HOPE VI Program, as
we have already heard, has had some impressive successes and
also faces some deep challenges.
The Choice Neighborhoods initiative has great promise as a
new phase of poverty deconcentration, but as best I can tell,
it also has the potential to repeat or overlook some of the key
shortcomings with the HOPE VI Program. Along with collaborators
at the University of Chicago, one of whom--Amy Khare--sits
behind me today at the hearing.
My research is focused at the ground level of the massive
public housing transformation currently underway in Chicago.
Our research has included in-depth interviews with almost 200
residents and 75 other stakeholders; and almost 300
observations of internal meetings and community activities. I
want to make just two main points this morning about what we
are learning about mixed-income development in Chicago. First
we have identified some of the early benefits that residents
have experienced, but also some important downsides to what is
happening to them. Second, successful mixed-income development
is more complicated than anticipated, and I will propose six
key success factors that should be considered.
So one of my early resident experiences in mixed-income
developments, on the very positive side, there have been high
levels of resident satisfaction with the new physical
environment. Public housing residents never thought they would
get to live in such high-quality housing. My written testimony
includes quotes, so you hear in residents' own voices about all
of these findings I am going to talk about.
Also positive, there have been self-reported psychological
benefits. Some report a decrease in the stress that they feel,
not having to deal with violence and crime. Some particularly
increased aspirations, feeling that they are more motivated to
accomplish more in their lives now that they have had this
housing opportunity. But, on the other hand, there are
residents who report an increase in stress. For some, the
strict rules and monitoring in the new developments generate
stress, and, some have told us that they feel there are double
standards that are applied to them versus the other residents
of the developments.
For some, there's an increased sense of stigma within the
new development. Residents feel stereotyped by their new
neighbors because of where they used to live. There are low
levels of social interaction among the residents. Some
residents are disappointed with the lack of a sense of
community. Others welcome the privacy in the new developments,
but there's a considerable amount of self-isolation--residents
withdrawing and really keeping to themselves. And this was not
the intention of HOPE VI.
There have also been some tensions and negative
interactions among residents driven by underlying us versus
them dynamics. These issues include an absence of shared norms
and concerns about social control. Let me use my remaining time
then to suggest six possible key factors for success:
Number one: balancing screening with inclusion: Which low-
income residents will get to return on-site to benefit from the
revitalization? The key will be how to screen-out those
residents who may create problems for everyone while screening
in as many residents as possible, who could make the most of
the opportunity.
Second, property management: It is clear that high quality
property management is critical to a successful development.
But less obvious is the potential for property managers to
either be central players in the positive community building
process; or, to detract from it by imposing their own
prejudices and differential treatment of residents.
Third, support services: Housing relocation alone will not
change residents' economic circumstances. There need to be both
pre and post occupancy supports; and, not just work supports
and incentives, but social services as well; and these services
must be sustained well beyond move in. So that's where there's
a need for long-term funding, service infrastructure and
service integration.
Fourth, physical design: Units should be externally
indistinguishable, but also physically integrated on the site.
And the design should include common space, green space, and
shared amenities. This is need to promote and shape social
relations; but, we must anticipate that it will be contested
space, raising issues of turf, of norms of behavior and of
informal social control.
Next, resident engagement and community building: Given the
extreme income and racial diversity in these sites, social
connections will not happen naturally. There must be ways to
identify shared interest and common ground, or else perceived
and real differences will drive social relations.
And, finally, governance and decisionmaking: In the Chicago
developments, the condo associations are the sole, formal the
decisionmaking body; and, they exclude all renters. The local
advisory counsels have been disbanded, thus creating tension
and increasing divisions. There need to be inclusive governance
bodies, where all residents can be represented and have a voice
in their community.
I'll end there. I have not had time to address the impact
of the current housing market crisis on mixed-income
development, and can take that up later if there's interest.
Thank you.
[The prepared statement of Dr. Joseph can be found on page
94 of the appendix.]
Chairwoman Waters. Thank you very much.
Dr. Popkin.
STATEMENT OF DR. SUSAN J. POPKIN, DIRECTOR, PROGRAM ON
NEIGHBORHOODS AND YOUTH DEVELOPMENT, THE URBAN INSTITUTE
Ms. Popkin. Thank you, Chairwoman Waters, and honorable
members of the subcommittee. Thank you for inviting me to
appear here today.
For the past decade, I have been studying the impact of the
HOPE VI Program on the original residents of public housing
targeted for redevelopment. While most of my research is
focused on Chicago, which had more distressed public housing
than any other city, I have conducted research in 15 HOPE VI
sites across the country.
My remarks today draw from two major studies: the HOPE VI
Panel Study, which tracked residents from five sites across the
country from 2001 to 2005; and the Chicago Family Case
Management Demonstration, which began in 2006. HOPE VI was a
key element of a bold effort to transform distressed public
housing communities and demonstrate that housing programs could
produce good results for residents and communities.
Evidence from The Urban Institute's Hope VI Panel Study,
the most comprehensive study of resident outcomes, shows that
many former residents have received vouchers or moved into
fixed-income developments, and now live in better housing, in
less-poor, dramatically safer neighborhoods. And as Dr. Goetz
said, we see the same finding in virtually every study that has
been done on relocation. However, despite these very real
gains, our research shows that the program has not been a
solution for those hard-to-house families who suffered the
worst consequences of distressed public housing.
If Choice Neighborhoods is to be more successful than its
predecessor in meeting the needs of the most vulnerable, the
initiative must incorporate strategies that effectively address
their needs. Hard-to-house residents are long-term public
housing residents who are coping with multiple, complex
problems, such as mental illness, severe physical illness or
disability, substance abuse, large numbers of young children,
grandparents raising young children, low levels of education,
weak labor market histories, and criminal records.
Our analysis from the data from the Hope VI Panel Study
estimated the proportion of families falling into one of these
categories ranges from 37 percent in 3 smaller cities to 62
percent in the 2 larger cities, in Chicago and Washington, D.C.
In 2005, we found that the follow-up, that every site these
hard-to-house families were more likely to end up in
traditional public housing than to have received vouchers who
have moved into mixed-income housing. Placing them in other
traditional developments may well have kept them from being
homeless, but clearly we need better solutions for vulnerable
residents than simply moving them to other developments, which
may well become as or even more distressed than the
developments where these families started.
The Chicago Family Case Management demonstration provides
one model for serving the needs of the most vulnerable public
and assisted housing families. The Demonstration, the
partnership of The Urban Institute, the Chicago Housing
Authority, and Heartland Human Care Services, serves residents
from two CHA developments and provides these families with
intensive family case management services, long-term support,
enhanced relocation services, workforce strategies for those
who have barriers to employment, and financial literacy
training.
The ultimate goal of these services is to help these
families maintain safe and stable housing, whether in
traditional public housing in the private market with a voucher
or in a new, mixed-income development. The project is now in
its third year, and has achieved impressive interim outcomes,
including engagement rates of 90 percent; and, successfully
adapting the model from one that provides place-based services
to one that follows residence post-relocation.
We have used the data from the demonstration to create a
resident typology to develop criteria for targeting services
effectively. Our analysis divides the demonstration population,
all long-term, extremely poor, African-American residents, into
three distinct groups based on characteristics, each needing a
different kind of service approach. What we call the ``Striving
Group'' has their high school diplomas. They are connected to
the labor market, even if they are cycling in and out of low-
wage jobs, and most significantly they are in good physical and
mental health. These are the residents most likely to benefit
from relocation with vouchers or to mixed-income developments.
Their biggest problem is that they have lived in public housing
for more than 20 years.
They will continue to need light-touch support to ensure
that they are able to maintain the gains they made in leaving
distressed public housing, including long-term follow-up,
employment and financial literacy services, and perhaps second
mover counseling to help them make subsequent moves to even
less poor neighborhoods that offer greater opportunities for
them and their children. In contrast, the group we're calling
``Aging and Distressed'' have stark physical and mental health
challenges, and are unlikely to move toward self-sufficiency.
In addition to having very fragile health status, most have
not worked in decades, and are truly disconnected from the
labor market and the world outside public housing. A better
approach for these extremely vulnerable residents is to focus
on harm reduction; essentially, helping them remain stable and
avoid becoming either homeless or ending up in nursing homes.
And since many of them still have children in the household, to
keep those children from ending up in the child welfare system.
For example, a strategy might be to convert some
traditional senior housing into an assisted living model that
provides sufficient care, meals, housekeeping activities,
healthcare and case management, to help these frail residents
remaining in the community. To accommodate the needs in the
public housing population, the service would need to be
available to residents well under the age of 60, so not just to
elderly who suffer from major and physical disabilities.
Finally, the group we're calling ``High Risk'' residents
share characteristics with both the ``Striving'' and ``Aging
and Distressed'' groups. Like the ``Striving Group,'' they
generally are younger and have children in the household; and,
like the ``Striving Group,'' the vast majority of these
residents indicated they didn't want to remain in traditional
public housing. But they have very low levels of education and
literacy. They are disconnected from the labor force. And,
further, while they are not yet as frail as the ``Aging
Distressed Group,'' they already have serious physical and
mental health challenges with high rates of poor health,
depression, anxiety, obesity, and substance abuse.
With their multiple challenges ``High Risk'' families are
the group for whom intensive case management models and
permanent, supportive housing are most likely to pay off in
terms of keeping them out of the homeless, child welfare, and
criminal justice systems. Assisting them to achieve their
housing goals for vouchers or mixed income, and helping them
move towards self-sufficiency.
In conclusion, with its proposed Choice Neighborhoods
initiative, the Obama Administration has the opportunity to
build on nearly 2 decades of experience with HOPE VI.
Incorporating intensive case management and permanent
supportive housing for the most vulnerable into Choice
Neighborhoods or any other comprehensive redevelopment efforts
is one way to ensure these initiatives truly meet the needs of
all public housing families.
Thank you.
[The prepared statement of Dr. Popkin can be found on page
117 of the appendix.]
Chairwoman Waters. Thank you all very much for your
testimony here today.
I would now like to recognize myself for 5 minutes to try
to raise some questions about some of what I have heard. Let me
ask Dr. Boston, would you describe the case management services
that have been received by those clients who have been moved
out of public housing or even those who remain in mixed-use
HOPE VI projects? What kind of case management do they get?
Mr. Boston. Each family who is relocated has an individual
case manager. That family is assigned a person and that person
works with an individual on a one-on-one basis, so that if it
is an issue of relocation or if it is an issue of attempting to
find housing, if they have to move from one location to
another, they have that. There's also a very extensive program
of training, both in terms of workforce development as well as
educational training and other kinds of programs.
Chairwoman Waters. Are the case managers social workers?
Are they individuals who are hired to connect with community
resources rather than do the kind of social work that deals
with the whole person and the whole family?
Mr. Boston. They are a combination of both, and they do.
Chairwoman Waters. Do you have professional social workers
who are doing this work?
Mr. Boston. The individuals are not professional social
workers, but they are individuals who are very familiar with
the problems that families have encountered and they have a
variety of strategies to assist those families in addressing
those problems.
Chairwoman Waters. The residents who are given Section 8
vouchers, and I think you described something like 61,000 of
those, I'll go back and take a look, had they been tracked? Do
you know why they are?
Mr. Boston. Yes, I do.
Chairwoman Waters. Where are they?
Mr. Boston. The residents who have Section 8 vouchers have
moved in a variety of locations. They have roughly of those who
have Section 8 vouchers about 20 percent live in suburban
communities outside of Atlanta and the remainder live in
various communities within the City of Atlanta. Most of those
residents are in the southern part of the city, but more
recently with the growing use of project-based rental
assistance, which allows the location of housing assistance
throughout the City, there are a number of families who have
moved in all locations of the City, including some of the
wealthiest neighborhoods.
Chairwoman Waters. So what you are telling me is your
research is such that you have traced all of those and you know
where they are and that none are concentrated in the poor
census tracks?
Mr. Boston. No. I am not saying that none are concentrated,
but I can tell you definitively that I have traced every one of
the families; and, we have what we call a metric, a community
attribute index that includes 16 variables. And we have
geocoded that index to the address of every family and we have
tracked those families' movements from year-to-year between
1995 and 2007.
Chairwoman Waters. How do you account for the growing
homelessness in Atlanta? I was recently there over by Five
Points and Woodruff Park, and there were hundreds of people
being fed. And when I went back in the evening I saw what
appeared to be thousands. Who are those people, and are any of
those former residents of public housing? Has the homelessness
increased in Atlanta?
Mr. Boston. Homelessness has increased, but I cannot say
the increase is due to any policies of the Atlanta Housing
Authority. In fact, as the initial part of my research, I spent
a great deal of time setting up a research designed
specifically to determine whether or not the housing policies,
particularly in regards to mixed-income development, was
causing families to lose housing assistance at a rate that
would not be expected otherwise, and I found that was not the
case.
Atlanta has had, up until the recent housing crisis, a
serious problem of housing affordability; and it had created a
tremendous strain for families, both working families as well
as housing assisted families, low-income families, without
jobs.
Chairwoman Waters. Well, you had waiting list for housing
assistance in 2001 with over 24,000 individuals on it. So are
you suggesting that even with the Section 8 vouchers that you
put out into the overall Atlanta area and the waiting list,
that there was plenty of room for these Section 8 vouchers,
plenty of units that could be utilized by the displaced
tenants?
Mr. Boston. The families who have been relocated, and in
addition to tracking records, I have conducted over 20 focus
groups, and each focus group has a minimum of 10 families
there. And so I have looked at families both qualitatively as
well as quantitatively and I can say that those families have
been able to find housing in locations throughout the City. And
there has not been a problem with families who received housing
vouchers finding places to live.
Chairwoman Waters. Our records show that as of 2007, of the
5,000 families displaced from public housing, only 332 moved
back into mixed-income communities. Does that number sound
correct to you?
Mr. Boston. That number does not sound correct to me.
Chairwoman Waters. What does your research show? About how
many moved back?
Mr. Boston. Well, yes. As I indicated earlier, my research
shows that roughly 20 percent of the families who were living
in public housing moved back to public housing, and the issue
is complex, because there is a normal year-to-year attrition of
families from public housing, and that attrition rate is about
10 percent independent of whether they are involved in mixed-
income development.
Families move away. Some families are evicted. Some
families have health problems, and other problems. And so
that's 10 percent across-the-board, so if you take that 10
percent out, which is true of both families affected by mixed-
income revitalization and those that aren't, then 20 percent of
those remaining who are in public housing moved back into
public housing developments.
Chairwoman Waters. Someone, and I don't know if it was you
who mentioned that the screening process for being able to get
back into a HOPE VI project is done by the private developer.
Is that true?
Mr. Boston. Yes.
Chairwoman Waters. Why would private developers be deciding
how we spend our government money to house?
Mr. Boston. Because that's the way it is done. I'm sorry,
Madam Chairwoman, I don't know all of the details of the
screening process, so I can't speak authoritatively on that.
But I can say simply that the housing authority works with
private developers and they outline the criteria that the
developers have to follow in providing services to the
families, and, there are also certain stipulations in the lease
agreement that families sign onto that establish conditions for
them occupying those houses.
Chairwoman Waters. Mr. Goetz, it sounds as if your research
and your information is quite different from Mr. Boston's. You
have heard what his research has shown in Atlanta, and it
differs somewhat with what you appear to have discovered in
your work. Can you tell me about what you have discovered with
the ability of those who were living in distressed housing who
are transferred into HOPE VI projects--the ability for them to
get back in--how was that screening done? Who gets back in and
why?
Mr. Goetz. Well, I don't know of any studies that have
answered that particular question about who gets in and why. I
do know that in most cities the screening process is managed by
private management firms that are working in the redeveloped
site and that they apply screening criteria that are generally
much stricter than what had been applied in previous public
housing instances. So increased tenant screening criteria is an
important reason why so few of the original residents ever get
back into the development.
Chairwoman Waters. Do you know if the private developers
have social workers who are part of that screening who are
looking at these individuals, what their needs are and how they
possibly could benefit from this redeveloped housing?
Are we looking at Atlanta and other areas who are
interested in getting people back into HOPE VI projects, who
had no problems, who have demonstrated that they already have
taken control of their lives and that they are on the path to
career development.
Are we literally getting rid of the most vulnerable people
in those housing projects who need more services and the people
who are already on the track to taking control of their lives
benefiting from these policies? Is that what we are doing?
Mr. Goetz. Well, I do know also that most of the families
who are displaced from a HOPE VI project, they do as many of
the members of the panel have mentioned: move to better
neighborhoods; but that's a relative term. They are moving in
most cases from neighborhoods that have 60 percent poverty to
neighborhoods that have 30 percent poverty. This still leaves
them in neighborhoods that are more than 3 times as poor as the
average city neighborhood and more than 4 times as poor as the
average metropolitan area neighborhood.
They also move to other racially segregated neighborhoods.
So those who don't get back into the redeveloped site may have
marginally improved their neighborhoods, but they are still in
many of the most disadvantaged neighborhoods in the city.
Chairwoman Waters. So, I'm going to move on to my other
members, but let me just say that everyone basically concluded
that most of the distressed housing projects are occupied by
African American and Latino minorities for the most part. And
when they are given these Section 8 vouchers that will allow
them to move wherever they want to move, they are moving into
suburbia and into better communities where they are welcomed by
everybody. Is that right?
Mr. Goetz. No.
Chairwoman Waters. No?
Mr. Goetz. No.
Chairwoman Waters. Why not?
Mr. Goetz. Well--
Chairwoman Waters. In Atlanta, they move wherever they want
to move.
Mr. Goetz. They are of course restricted by the ability of
fair market rents and by the willingness of landlords to accept
housing choice vouchers. They are also limited by their
knowledge of the housing market and their own preferences for
staying in neighborhoods that are neighborhoods that they may
be more familiar with or neighborhoods where they had social
support networks in place.
Chairwoman Waters. Do you think that the poor Census tracks
in these cities are impacted by the displaced, Section 8
voucher holders, more than any other sections of these cities?
Mr. Goetz. Are you still asking just me?
Chairwoman Waters. Yes, just you.
[laughter]
Mr. Goetz. I asked because I actually haven't researched
that particular question, but, given the fact that that's where
most of the displaced families conduct their housing searches,
it's logical to conclude that it's putting significant pressure
on the housing stock in those neighborhoods.
Chairwoman Waters. Well, I thank you for that, and the
reason I did not ask some of the others was I had an
opportunity to meet Mr. Jones up in New York when I held a
hearing there just last week, and I know what he has testified
to. And both Dr. Harris and Dr. Popkin basically gave testimony
today that comports with my experience having worked in public
housing.
So I just did not ask them additional questions, because,
you know, they too like you seem to share some of the knowledge
and information that I have, but I wanted to hear a little bit
more from you, because you first opened up some of the
questions about the success. And everybody said with HOPE VI
there is some success, but I appreciate you also identifying
the weaknesses along with Dr. Fraser.
Thank you very much.
With that, I will turn to Mr. Cleaver.
Mr. Cleaver. Thank you, Madam Chairwoman.
I understood Mr. Goetz on the same deal, but I want to
include Dr. Joseph and Dr. Harris to perhaps get some kind of
an academic response as well. When I was Mayor of my City and
in charge of public housing, we built the first HOPE VI project
in the Nation in Kansas City, Missouri. And if we look at the
units today, they still look good.
They are well cared for, but I was criticized because all
the HOPE VI units are still in the lowest income tracks. But,
we have a structural problem, and I don't know how we can get
it fixed. I know right now you're going to fix it, because you
can answer this question and we are going to solve this
problem. I am going to be a hero. Yale University is going to
get big grants.
Here it is. HUD--Mr. Cabrera may need to get in this as
well--will only give a certain amount of money for land
acquisition. And it turns out that land acquisition is always
less expensive in the low-income tracks. And so if we get
dollars for a HOPE VI project, I don't care where the housing
authority looks or the mayor looks, it's going to end up in the
lower-income tracks, because that's the only affordable land.
How do we solve it?
I mean, there are some neighborhoods that are exempt. Now,
they would probably fight anyway, but their exemption, at least
when I was mayor, is based on the fact that I can't buy land
there.
Mr. Cabrera. Congressman, are you asking?
Mr. Cleaver. Well, yes.
Mr. Cabrera. Okay. HOPE VI developments happen on property
that belongs to the public housing authority that is subject to
a declaration of trust and that has units that have annual
contributions contracts on them that are going to be
demolished. So when the portion of the HOPE grant, and I don't
recall that there is an acquisition portion, it might be that
they are adding on land around the property that they already
own.
The first step in HOPE VI is identifying what property the
public housing authority has that it wants to deal with in
terms of demolition. HOPE VI's purpose, legislative intent to
this day, is two-fold. It is to demolish public housing units
that are obsolete, because the vast majority of public housing
stock is between 50 and 70 years old. Its purpose is to
deconcentrate poverty. And its purpose is to build something
back, using a bunch of different kinds of financial tools--not
just public housing funds. The reason that it worked in Kansas
City, the reason it has worked in other cities as well--when it
has worked and it has worked mostly--is because the marriage of
all those tools have come out with a product that serves a lot
of people--not just the demographic--that is occupying the
public housing band width.
Public housing is a financing mechanism. It essentially is
a unit financing mechanism to operate a particular apartment.
When you add the other mechanisms, you are serving essentially
low-income people, but you may not be serving low-income people
who had received a public housing unit. Dr. Popkin illustrated
this just a few minutes ago with respect to how it is that
folks come back or don't come back. There's always attrition
from public housing.
One of the reasons that it winds up being the case that
HOPE VI deals, as you noted, look better, is because generally
the way they are pro forma, the way they are economically
modeled, allow for reserves to permit the maintenance of those
units. So from an economic perspective, Dr. Boston, I don't
know if I missed that, but if I did, please correct me.
Mr. Boston. Yes. Congressman, I would like to share my
perspective on that, and maybe we can get some grant money
coming to Georgia Tech. But it requires a complex of strategies
to have a successful community. The fundamental strategy is
that you have to focus on the issue the ladders that create the
fulfillment of the human potential. And above and beyond bricks
and mortar, and anything else, the most important element is
having in place policies and strategies that allow families to
fulfill their human potential.
What does that mean when we talk about neighborhoods? Well,
forget about the bricks and mortar. We mean, have we built
better schools? Do the children have access to better schools?
On average, their mother, typically black, has two kids. Those
kids are very young. She is concerned about their safety. Have
we addressed issues of crime in the neighborhood through
various partnerships with communities that have capabilities of
doing so? Have we established an early learning center and do
we have new YMCAs or after school programs?
Mr. Cleaver. I am going to interrupt you because you're
making the point I was trying to make. What we're talking about
is trying to completely, socially, and in some cases even
morally and physically, rehab an area and that's because the
only place we place housing units are in areas like that.
I mean why can't we place housing units, whether they are
Section 8, whether they are HOPE VI, in areas where, you know,
everybody says scatter sites of housing. If people find out
that you're going to try to build something, they are going to
come and say, I know the whole deal. We will have traffic
problems if we build new housing coming in, or we're going to
overload the schools. But why can't we have scatter-site
housing in neighborhoods where we don't have to go in fighting
crime?
Mr. Cabrera. It's very expensive, scattered housing. And,
Congressman, just a small tweak: The case of Kansas City is
different than other cases. So if you go to San Francisco,
there is a HOPE VI deal smack down in the middle of North
Beach. If you go to Seattle, there is a huge, brand new,
beautiful HOPE VI deal in South Seattle, which is now a very
vital community. And, if you go to Tacoma, you go to Salishan.
It's another example of a place where, again, it's in a vital
community. And this is where the local nature has to be brought
into consideration. It depends upon the location. It depends
upon where you are building. It is a very different situation
in Kansas City, perhaps, than it is in Seattle. And I think
that's part as it is in Atlanta for that matter. So I think
that's part of the stress there.
Chairwoman Waters. Thank you very much.
Mr. Green?
Mr. Green. Thank you Madam Chairwoman, and I thank both you
and the ranking member for the work that you have done in
affordable housing, especially with the Affordable Housing
Trust Fund, which I hope will in time help us with a good many
of the problems that we are contending with currently. I also
thank you for the assemblage of witnesses that we have today,
all of whom have great credentials, and I thank you for your
testimony.
My first question, and it's to anyone who would care to
respond, and if you can be terse, it would be appreciated. Why
do we need brick and mortar as opposed to just having vouchers?
There are many who contend, why have a building that we have to
manage? Why not just have all vouchers?
Mr. Goetz. The most prominent answer to that would be that
in some cities with very tight housing markets, Housing Choice
vouchers are extremely difficult for tenants to use. They face
tremendous competition in the rental market, and given the
choice, landlords tend to prefer residents who don't have
vouchers and Section 8 certificates to those who do. And so in
some hot real estate markets that characterize many American
cities, Housing Choice vouchers are about as good as
confederate money.
Mr. Green. Moving to another question, and thank you.
We have lost about 50,000 public housing units because of
the HOPE VI revitalization program. Is that a fair statement?
If I have made an unfair statement, somebody please correct me.
Mr. Cabrera. We have demolished 110,000 units through the
HOPE VI Program, if I recall.
Mr. Green. Now, if the purpose of the Program was to
revitalize severely distressed public housing, has HOPE VI in
some fashion been less than HOPE VI, maybe HOPE V?
Mr. Cabrera. There was a HOPE V, you know. There is HOPE I
through V.
Mr. Green. Yes, well.
Mr. Cabrera. HOPE VI has been successful in places where
the local government has the capacity to move it forward. It
has struggled in places where that might have been a challenge.
I would take, you know, without at all trying to appear
disagreeable, I would disagree with Dr. Goetz.
In those places that allocate Section 8 vouchers, what
you'll find is utilization rates that are bordering 98 percent,
and they tend to be very dense areas of the country. The places
where you see Section 8 probably struggle a bit, are in places
that have housing authorities in suburban areas or housing
authorities in rural areas.
Rural areas drive a lot of the Section 8 voucher
underutilization. The second largest housing authority in this
country is not on the mainland. It's in Puerto Rico. It has
more units than Los Angeles. It has more vouchers, I believe,
than Chicago.
Mr. Green. I am going to have to ask you to wrap up. I have
about four more questions.
Mr. Cabrera. No, sure. I'm sorry. And so my point is, it's
more a balance of understanding what the demand is in the city.
Mr. Green. And I'll give you a chance to respond in a
moment if I have enough time. But because we don't have one-
for-one replacement, and because we have persons who do not
return for various and sundry reasons, I have to ask, is HOPE
VI being used to evict people from projects who ordinarily
might not be evicted? I heard what were called forcible injury
and detainer lawsuits in another life, commonly known as
evictions.
And there were persons who could not be evicted, but my
suspicion is if they had a chance to find another way to move
persons, this may have been done. So does that happen when you
rebuild, reconstruct? Do you lose people who have been deemed
undesirable, but who were lawfully eligible to be in the
project, the housing unit?
Ms. Popkin. May I respond to that?
Mr. Green. Go on.
Ms. Popkin. Our research has shown that what mostly happens
to the most troubled tenants, the undesirable tenants, is they
have been moved to other distressed public housing. They have
not been evicted in large numbers. They have been pushed
somewhere out of the way in a place that I think could become
even more distressed than the place they started, because now
you have all the troubled families concentrated together. So in
the housing authorities I have studied, they have certainly
been moved out of where they were, which was often an awful
place. But they often feel that where they have gone is a
little bit better, but it's certainly not anywhere any of us
would think is a good solution.
Mr. Green. Madam Chairwoman, may I ask one final question?
Chairwoman Waters. Yes.
Mr. Green. My final question, thank you, is this. Is public
housing in this country at risk because of undocumented
workers?
Mr. Cabrera. No, Congressman. Public housing is offered to
either folks who are legal residents of the United States or
U.S. citizens; or, alternatively, children who might have
parents who are illegal, but who have an entitlement.
Mr. Green. But are you having a real problem? Are you being
sued by undocumented workers, lined up outside, demanding that
they have units?
Mr. Cabrera. No.
Mr. Green. Are they protesting outside, saying where is my
public housing?
Mr. Cabrera. They aren't, Congressman.
Mr. Green. I ask because there's a big concern about the
takeover, about the undocumented workers just absolutely
consuming the public housing stock of this country, and I'm
eager to know where this is happening. Have any of you
experienced a big takeover because of undocumented workers?
Mr. Cabrera. No. No.
Mr. Green. Let the record reflect that all heads were
indicating a negative in terms of an answer, and I thank you
Madam Chairwoman. If we have a second round, I will have more
questions.
Chairwoman Waters. Thank you very much. Our ranking member
has returned. Ms. Capito?
Mrs. Capito. Thank you, Madam Chairwoman.
I apologize for missing a lot of the testimony, but I am
very interested in the questions. Dr. Boston, in your
presentation you talked about the influence of different public
housing availabilities on the level of achievement for students
in testing. And, I think if you go from 29 percent in public
housing to 43 percent in the mixed income, that's dramatic.
I am not a professional like you all are, but that's a
dramatic increase there. But as you said, that's still low, but
it's going in the right direction. How much in the future
strategy of the best way to put forth public housing are
statistics such as this incorporated into reshaping public
housing for the future? We are looking at the academic side of
the polling--not polling--but the research that you have done.
Mr. Boston. Thank you very much for the question. It is
increasingly becoming an issue, and, indeed, a growing criteria
that is being asked of public housing authorities to consider.
That is, how do various policies affect the performance of kids
whose families receive housing assistance, so that if you look
at the Choice Neighborhoods Program, it's a part of that
program. And I think it's an excellent criteria, because
fundamentally, those are the kids who in the future will either
contribute productively to society or if there is no adequate
intervention, unproductively.
Mrs. Capito. Does anybody else have a response? Yes, Dr.
Joseph?
Mr. Joseph. I think it is also important to note though
that what Dr. Boston is finding may also be evidence of
different populations going into different circumstances. So
the group that we see going into mixed-income housing and
having these better numbers in terms of achievement may have
been actually a higher achievement group in some ways, had they
been able to jump through the different hurdles they needed to
to get themselves into the new housing versus taking a voucher
or making different choices.
So part of what we do moving forward to your question is
also sort out a little bit how much of this is an actual impact
of the different circumstance and how much is driven by
different types of families making or being forced or
constrained into different choices.
Mrs. Capito. Yes, I could see that. I see what you're
saying, but I do think as Dr. Boston points out that those
children--and I'm sure I'm not telling you something you don't
already know, but--those children are probably going to be the
children; that, as they grow if they fail to achieve or if they
have difficulties--meaning they are going to be the ones who
are going to be looking at public housing as an option for
them--and then the cycle continues in a way that it makes it
difficult to break those cycles. So I think that's good.
We do a lot in this committee and subcommittee about
different social programs, and counseling programs, housing
literacy programs, foreclosure assistance. Well, not
foreclosure, obviously, that wouldn't be right, but other
educational programs. And can you give me an overview of the
utilization of these programs and are they actually achieving
what we hope they do achieve?
Ms. Popkin. I think that related to the HOPE VI Program,
specifically, the case management has very considerably. You
heard Dr. Harris talk about Memphis, where it took them a long
time to develop a comprehensive case management. I know from
Chicago, the City where I'm doing work now, utilization is
about 50 percent, generally.
Mrs. Capito. About what?
Ms. Popkin. 50 percent.
Mrs. Capito. 50 percent of the residents are using it or
the total program is only used 50 percent of the time?
Ms. Popkin. 50 percent of the residents are using it in a
demonstration. We are doing it and have been able to increase
that to 90 percent, but that takes extra money and more time
for the case managers.
Mrs. Capito. What would be the best? This might be a
dangerous question in some sense, but what would you say is the
most effective best program in terms of counseling assistance,
whether it's parenting or child skills, or financial literacy
or home budgeting? I mean, is there one that kind of stands out
above the rest?
Ms. Popkin. I think you need all of it, especially. You
know, a lot of people have been using distressed public
housing, not all public housing, the subset of really troubled
public housing, as the housing's last resort. And you're
dealing with a population that is very similar to the homeless,
and they need comprehensive services--everything you
mentioned--parenting, support. And a lot of them are going to
need it for a long time. It's not going to go away quickly.
Mrs. Capito. Doctor?
Ms. Harris. May I say, in Memphis, they do really think.
They haven't come up with words like Dr. Popkin described for
their typology in Chicago looking at their entire case load.
But they really do think about, you know, what are the services
appropriate for their elderly and getting them in stable
housing, where there's not work as a goal there. And what do
they do for people who are officially, technically disabled,
who may be able to work a little bit.
But a full time job is not feasible for them and helping
them find what's appropriate for them. And then there's the
whole rest of the case loads. That's the working age adults who
may have employment, or may not, that need some further
assistance in some way. And it's figuring out for them is their
key barrier really getting him hooked up to one more program;
you know, a job training program, that's going to move them
into a position that would be stable for them; or, is it really
getting them into that literacy class and finding childcare and
whatever the other issues are.
So I think it's so hard to come up with what is the program
or what is the most effective, because it's so personalized for
small segments of the case load. And I think Memphis has done a
good job of looking at that, particularly when it comes to
employment, in figuring out small groups to work together with
those residents to move toward employment.
Mr. Jones. I would just be careful, and not just from an
academic vantage point, not to forget that the magnitude of the
recession we are in is changing all the rules. If you have
whole communities where public housing is set that are losing
employment at extraordinary rates, that changes the game
entirely.
So some of the inventions we're talking about here may not
be as effective, because the real question is, can you get
people back into the workforce and can you get people in
housing authorities, that we see some skills to get back into
productive work? So I think there has been a shift here, and
some of the fights we have in New York are assuming full
employment where people are just holding back. That's not the
case here. People are clamoring for work.
Mrs. Capito. Thank you.
Chairwoman Waters. Thank you very much.
Mr. Driehaus?
Mr. Driehaus. Thank you very much, Madam Chairwoman, and
thank you for this hearing.
I have worked with the housing authority very closely over
the last 10 years in Cincinnati, and, with all due respect to
Dr. Boston and his comments about the way the voucher system is
working, we haven't seen it play out that way in Cincinnati.
And I would like to ask any member of the panel about rent
reasonableness, because we are running into what I perceive to
be a real challenge.
The HOPE VI project in Cincinnati has displaced many low-
income families, but in addition to the HOPE VI project, there
were other very large developments that were also torn down
around the same time, which led to a dramatic increase in the
voucher population. But where the relocation occurred in many
cases was driven not by the housing authority or the policies
of the housing authority directly, but by what they were
claiming to be the private sector.
Well, when we dug into it a little deeper, what we found
was that the reimbursement rates for the vouchers in certain
neighborhoods, and they tended to be high poverty
neighborhoods, so far exceeded the market rate rental that
that's where landlords flocked. We are in low- to mixed-income
neighborhoods, and, purchase single family homes, there was an
additional incentive, a 10 percent bump-up in the voucher if it
was a single family home.
So we found a lot of investors going in and purchasing
single family homes in what were moderate priced neighborhoods.
And what we did not find was the type of dispersion, Dr.
Boston, that you spoke of in Atlanta. And we found that there
was a reconcentration of poverty in essentially the
neighborhoods right around where the HOPE VI project was. So we
created this kind of artificial mixed-income neighborhood
through the HOPE VI project.
We took what were mixed-income neighborhoods in the
surrounding area, and turned them into low-income
neighborhoods. And we have seen the subsequent flight that one
often sees when that happens. You know, in addition, these were
the same neighborhoods that were impacted by predatory lending
and who have felt the brunt of a foreclosure crisis. So at the
same time, these neighborhoods are experiencing predatory
lending.
They have an influx in investors using vouchers, and really
tipping the balance in many of these neighborhoods. But it was
driven in large part in terms of the voucher side by what the
reimbursement rate was for the voucher. How do we get around
the rather strict requirements at HUD on rental reimbursements?
How do we get more flexibility to the local housing authority
to recognize where that disparity exists between the rental
reimbursements and the market rate to make that even across-
the-board, so we do achieve the type of balance that Dr. Boston
spoke of.
Mr. Boston. Could I just respond very quickly?
Mr. Driehaus. Sure.
Mr. Boston. And, again, one of the things Atlanta has done
is to create what they call rental submarkets. And, so, rather
than applying the same fair market rental standard across the
City, whereby you actually constrained to neighborhoods that
you can move in and it confines most of the rental
opportunities to the lower-income neighborhoods, they have
taken the same pool of money and disaggregated it, broken it
down into different power, depending upon the cost of housing
in different neighborhoods.
Mr. Driehaus. The challenge we face is that those runaways
can change dramatically from street to street in certain
neighborhoods. So when we try to set rental rates by Census
track, even, they can be wildly off, depending upon what block
you're on.
Mr. Boston. Right.
Mr. Driehaus. And in many older cities, we find this all
the time, that neighborhoods are not homogenous in terms of the
housing. But, yet, the Housing Authority finds itself
restricted because of what they are being told by HUD.
Mr. Cabrera. Congressman, it isn't so much what they are
being told by HUD. HUD, when they set rent payment
reasonableness standards, now use something called the American
Community Survey. And it isn't the perfect tool. Traditionally,
it used a lagging indicator built on the Census, which meant
your rent standards were being set 2 years behind the date when
it would apply.
Mr. Driehaus. But by Census track, correct?
Mr. Cabrera. It is by Census track, but it's beyond the
Census track. It is more a survey beyond what you are
describing to me, as I understand it, is a qualified Census
track. So it has other permutations to it. Even if it is a
standard rate, housing authorities can go in and ask for a
multiple increase over the rent reasonableness standard up to
140 percent. One of the problems here--I hate to keep coming
back to this--but actually there are two issues that you are
highlighting.
The first one is that rent setting is a bit of a Byzantine
process, and for most public housing authorities it is very
frustrating. If anybody knows what their community looks like,
it's the housing authority. They know what rents should be.
That is an issue of some controversy before this body. It has
been for a very long time.
I am certainly an advocate of that decision being made, as
locally as humanely possible, within some parameter. But the
second issue here is one of a housing authority recognizing
what it's looking at in terms of what its housing stock looks
like. Cincinnati's housing stock is very different than
Atlanta. Atlanta has an enormous number of multi-family options
and also of single-family detached, where Cincinnati has far
more single-family detached.
That's the supply driver, and that has to do with a broader
policy issue that's tougher to address. Certainly, on the
payment standard issue, there are options that the housing
authority has within a degree, but there is a question in
there, a policy question, of who is better at setting rents. Is
it going to be the public housing authority, or is it going to
be policy development and research at HUD. And I understand.
Mr. Driehaus. Well, I appreciate the understanding. I thank
you, Madam Chairwoman, and I'll wrap up. But I really do think
that the objective, obviously, through the voucher program, is
to allow families, allow kids to grow up in neighborhoods that
create a supportive environment. But that is not the way we
have seen it play out, at least in Cincinnati. What we are
seeing is a reconcentration of poverty. You know, the same type
of concentration we are trying to break down through the HOPE
VI project, but that's not how it's working in practice. And I
believe that for the most part is due to the restrictions
through rent reasonableness that are placed on local housing
authorities by HUD. And I would like to see far greater
flexibility.
You only have to open up the newspaper to figure out what
the market rate is in a given neighborhood or sub-neighborhood.
It's not that tough, and it seems to me that we should allow
local authorities the flexibility to do so.
Chairwoman Waters. Thank you very much.
I would like to yield to myself another minute and to all
of our members here today one minute for a closing statement or
questions that you may have.
Let me just thank our participants for being here today and
presenting very valuable information. We really do have to
think about public policy for this entire country and recognize
that they are different communities with different kinds of
problems and different kinds of resources that we must
recognize. But we must always recognize that there are people
who have little or no income and have little or no education or
health problems and other kinds of problems that do not allow
them to be fully in charge of their lives, and we have to deal
with that. And so we are going to look at all this information
and try and get all of the research that we possibly can to
help move us to a public policy that will make good sense for
basically everyone.
I am committed to the moratorium on demolition for the next
year. I think that's important while we try to get a handle on
where we are going. We will be looking very closely at the new
secretaries at Choice Neighborhoods proposal, etc., etc. Let me
just close by asking a very simple question relative to the
private developer criteria I have been given from Atlanta in
determining whether or not residents are eligible in the
residents' election plan. There are several questions that I
don't understand.
Credit and good standing: No negative information without
remedy relating to a landlord, property owner or mortgagee. No
debt can have been written off within one year of application,
including bankruptcy as a write-off. Any past-due consumer
debts showing balances older than 6 months must accompany
written evidence on creditor stationery indicating repayment
plan, and no past due balances within 3 months of application.
What does that have to do with whether or not a potential
resident, particularly one who lived in distressed housing, is
able to get back into a HOPE VI redeveloped project. Anyone?
Yes, Mr. Fraser, is it?
Mr. Fraser. Yes. I would say that that speaks to the
multiple goal sets that public housing authorities find
themselves in under a type of program like HOPE VI. So they
have the responsibility of managing an asset, that asset has
been heavily invested in. And, most times, what I have seen in
my own research is that the rules and regulations go well
beyond what would be expected of someone who is middle class
and items that aren't necessarily pertinent.
So in the name of keeping the asset the way it is, we do
find that many people who need housing are kept from it. So
it's not surprising my research in Nashville, where I
interviewed people at all four public housing sites that were
HOPE VI, no one is complaining, because everyone who got in met
such high criteria that they are really not the population that
I was speaking of before who needs the most help. They are
grateful, but we need to also help those people who have not
risen to that level yet.
Chairwoman Waters. Does anyone on the panel believe that no
debt can have been written off within 1 year of application,
including bankruptcy as a write-off, is a fair criteria?
Mr. Cabrera. Madam Chairwoman, for me it's not a question
of whether it's fair or not. There are two dynamics in a HOPE
VI deal, and I'm assuming that questionnaire comes from a HOPE
VI deal. The first one is which are the units that are being
financed with ACCs, and which are the units that are being or
were financed in terms of their construction by low-income
housing tax credits?
When they are financed by low-income housing tax credits,
it means an investor was involved. And that questionnaire is
very, very common in the 2 million or so units that we have
nationwide with respect to low-income housing tax credits.
Further, I am currently a tenant in Southern California.
Chairwoman Waters. Do you meet the credit criteria?
Mr. Cabrera. Pardon me?
Chairwoman Waters. For this application?
Mr. Cabrera. I received an application that looked an awful
lot like that, and asked those questions, just like the way you
have asked them. Now I ask those questions, because when you
are an investor, the critical issue is can the tenant pay rent,
in order to support the units that they have invested in.
If there is evidence the tenant cannot, that is
troublesome, because they are the landlord and they have to pay
usually a lender. They have to pay an investor. They have to
pay whomever they have to pay. They have to find out whether
that's a legitimate recourse.
Chairwoman Waters. What percentage of public housing
tenants are evicted for non-payment of rent?
Mr. Cabrera. Public housing tenants?
Chairwoman Waters. Yes.
Mr. Cabrera. I don't know. It depends upon what the public
housing authority's policy is on rent setting. I think a great
example of which percentage are evicted for, you know, Section
8 vouchers are a great example. If the Section 8 voucher is
presented to a HOPE VI deal that has been financed by low-
income housing tax credits or any low-income housing tax credit
deal, there are a series of questions. The first one is, do you
have a criminal record, because that's required by Federal law.
Chairwoman Waters. I know. I know about that. I am just
interested in the credit question, because I am aware that
unfortunately many people in our society oftentimes run into
credit problems.
Mr. Cabrera. Right.
Chairwoman Waters. And to have had a debt written-off, does
not necessarily mean that it was your fault. It could have been
fraud that was involved in the contract that was opposed by an
attorney or someone that caused it to have to be written off.
This is very tough criteria--
Mr. Cabrera. Madam Chairwoman, I couldn't agree with you
more.
Chairwoman Waters. --to ask of poor people.
Mr. Cabrera. I am not saying they are right.
Chairwoman Waters. Yes.
Mr. Cabrera. I am simply saying in terms of how they are
asking it's very normal in this context.
Chairwoman Waters. No. It is not normal in this context.
Mr. Cabrera. No. No, I'm saying but Section 8 voucher
holders are not typically evicted; that's once they are in.
Chairwoman Waters. No, they are not.
Mr. Cabrera. That's what I was trying to answer.
Chairwoman Waters. I understand.
Thank you very much. Let me go to Mr. Cleaver. Do you have
one minute, Mr. Green? Oh, I'm sorry. Ms. Capito comes first.
Excuse me. Ms. Capito.
Mrs. Capito. Thank you, Madam Chairwoman.
I want to just thank you all and I appreciate it. And we'll
just continue working on this. It's very important to the
safety and health of a lot of people here in this country.
Thank you.
Chairwoman Waters. Thank you very much.
Mr. Green?
Mr. Green. Yes, thank you, Madam Chairwoman.
Madam Chairwoman, I would like to join you in supporting
the moratorium and I believe it would be beneficial. Also, I
would like to simply submit that whether by accident or design,
it appears that the Federal Government is becoming the sole
source of affordable housing. And, I wanted to have some
response to this basic premise that while municipalities
receive the funds, and by the way, when they open up a new
project, there is a big, big, big parade. We have a new housing
project.
Never say that it's funded by Federal dollars. There seems
to be the notion that municipalities are doing it, but it's
actually the Federal Government that's funding it and it's not
widely known. So I see someone who would like to respond and
let's start with the doctor at the very end, Dr. Boston.
Mr. Boston. Yes, Congressman, and it's a very astute
observation and an important issue. One of the things that I
have done as a part of my research is looking at the benefits
and cost of revitalizing communities, and I shared with you
that benefit. For the 6 communities that I looked at, on
average, it was $126 million.
One issue that I have raised with individuals who are
involved in this area, both developers and others, is how can
that surplus be used to generate greater affordability in the
neighborhoods within which mixed-income developments have been
constructed. Let me just give a brief example, and I know that
time is short. But if you look at the neighborhood in Atlanta
where Centennial Place is now, that was formerly Techwood
Homes. That neighborhood had a violent crime rate of 37 times
the national average. Now, that neighborhood has not only a new
mixed-income development, but it has the Georgia Aquarium. It
has the New World of Coca Cola and the Civil Rights Museum.
That is a great deal of tax revenue that has been
generated. So I think that there needs to be creative
strategies, getting with private developers to figure out if
these benefits are flowing to both the private and public
sector, how can they be used to generate greater affordability
in the communities surrounding it.
Mr. Cabrera. Congressman, just to add to Dr. Boston's
comments, HOPE VI by itself has never funded a unit. The low-
income tax credit has never funded a unit. Nor have private
activity bonds ever funded a unit of affordable housing. All of
those things together, together with local money and State
money in a variety of pots are put together with private money
to fund a unit. When we talk about HOPE VI, it's one part of a
very big machine. I can say that with some glee because I have
been in a lot of grand openings and a lot of HOPE VI grand
openings. They have never forgotten about us.
Mr. Green. You said they have never forgotten about it?
Mr. Cabrera. Never forgot the Federal Government; they
always said thank you, and we were always a big piece of the
pie. But it should be the case that those grand openings are
participatory and that they involve everybody involved in
financing the construction of these units, because it takes a
lot of the partners.
Mr. Green. Thank you, Madam Chairwoman.
Chairwoman Waters. Thank you very much.
Mr. Green, we are going to have to get to a telephone
interview. I would like to thank all of the panelists for
coming. 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, and, without objection, I would like to
enter into the record the criteria that is being used by
private developers relative to the screening process for
potential resident.
With that, this committee is adjourned.
[Whereupon, at 11:59 a.m., the hearing was adjourned.]
A P P E N D I X
July 29, 2009
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