[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
STATUS OF THE ``BIG FOUR'' FOUR YEARS
AFTER HURRICANE KATRINA
=======================================================================
FIELD 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
__________
AUGUST 21, 2009
__________
Printed for the use of the Committee on Financial Services
Serial No. 111-71
----------
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Washington, DC 20402-0001
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:
August 21, 2009.............................................. 1
Appendix:
August 21, 2009.............................................. 73
WITNESSES
Friday, August 21, 2009
Freeman, Yusef, Project Manager, McCormack Baron Salazar......... 55
Grauley, Jim, President and Chief Operating Officer, Columbia
Residential.................................................... 46
Henriquez, Hon. Sandra Brooks, Assistant Secretary for Public and
Indian Housing, U.S. Department of Housing and Urban
Development.................................................... 9
Johnigan, Donna, Vice President, B.W. Cooper Resident Council.... 53
Johnson, Valerie S., former resident, Lafitte Public Housing
Development.................................................... 51
Key, Keith B., Chief Executive Officer and President, KBK
Enterprises.................................................... 52
Marshall, Jocquelyn, President, C.J. Peete Resident Council...... 57
Mingo, Stephanie, former resident, St. Bernard Public Housing
Development.................................................... 48
Nagin, Hon. C. Ray, Mayor, City of New Orleans................... 6
Patterson, Angela, Director, UNITY Welcome Home.................. 38
Perry, James, Executive Director, Greater New Orleans Fair
Housing Action Center.......................................... 32
Sinha, Anita, Senior Attorney, The Advancement Project........... 30
Tuggle, Laura, Southeast Louisiana Legal Services................ 34
Whetten, Michelle, Vice President and Gulf Coast Director,
Enterprise Community Partners.................................. 49
Wiggins, Cynthia, HANO Resident Advisory Board................... 36
Woods, Wayne, General Counsel, Housing Authority of the City of
New Orleans.................................................... 11
APPENDIX
Prepared statements:
Freeman, Yusef............................................... 74
Henriquez, Hon. Sandra Brooks................................ 78
Marshall, Jocquelyn.......................................... 86
Mingo, Stephanie............................................. 91
Nagin, Hon. C. Ray........................................... 94
Patterson, Angela............................................ 99
Sinha, Anita................................................. 105
Tuggle, Laura................................................ 122
Whetten, Michelle............................................ 147
Wiggins, Cynthia............................................. 154
Additional Material Submitted for the Record
Waters, Hon. Maxine:
Written statement of Samuel L. Jackson, Mayday New Orleans... 162
STATUS OF THE ``BIG FOUR''
FOUR YEARS AFTER
HURRICANE KATRINA
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Friday, August 21, 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 10:25 a.m., in
the Lawless Memorial Chapel, Dillard University, 2601 Gentilly,
New Orleans, Louisiana, Hon. Maxine Waters [chairwoman of the
subcommittee] presiding.
Present: Representatives Waters, Cleaver, and Cao.
Chairwoman Waters. Good morning, ladies and gentlemen.
Today is our second day at Dillard University's beautiful
Lawless Chapel. Again, I would like to extend my thanks and
appreciation to President Hughes for allowing us to use this
space for a second day.
And with that, I would like to ask President Hughes if she
would come forward and share with us her thoughts about our
visit here and the University, or anything else she would like
to talk about.
Ms. Hughes. Good morning.
Chairwoman Waters. Good morning.
Ms. Hughes. I am so pleased for this second day and I base
that on the fact that yesterday was so substantive. I listened
to so many people who were pleased with the information and who
learned as much as I did, because I did not understand all of
the complexities involved in the topic. So we have the
privilege of having a second day so that we can listen to
another topic.
Let me just say thank you, the Honorable Chairwoman Waters,
for coming to Dillard University now for 4 days, and presenting
issues that are so critical and so important to the entire
community. I also want to thank the Honorable Emanuel Cleaver,
who remained here and who yesterday was very insightful as
well. Now I know why your son, the alumni from Dillard, was so
successful. You did a good job.
Mr. Cleaver. Thank you.
Ms. Hughes. To the Honorable Joseph Cao, you have become an
ally to Dillard University and that is very, very important to
us as well.
I want to thank the entire community for coming to Dillard
University, because Dillard enjoys opening its doors for the
community as well. We are now in a position to do that because
we are almost finished with the total restoration of this
university. Every single building has almost been restored and
certainly you can tell that this one is now up to par. And so I
invite the community to use this space as they need to for
these kinds of activities and other appropriate activities.
I want to welcome other politicians who are here as well
and I would like to have them stand so they can be recognized.
Would all of our elected officials stand to be recognized,
please?
[members of the audience rise]
Chairwoman Waters. I do not know if everyone heard the
President welcoming all of the elected officials. She asked
that you all stand, please stand.
Thank you very much.
Ms. Hughes. Thank you. Have a good session.
Chairwoman Waters. Thank you very much, President Hughes.
We are so appreciative for your generosity and we are delighted
to be back at Dillard and let me just say you have done a
wonderful job. This building is beautiful and we feel very,
very fortunate to be able to be here. And even though we do not
solicit applause in these hearings, I would like to ask the
audience to please applaud President Hughes for the wonderful
job that she is doing here at Dillard.
Thank you so very much.
[applause]
Chairwoman Waters. Ladies and gentlemen, today is our
second hearing in Dillard University's beautiful Lawless
Chapel. We are here today to talk about the status of the ``Big
Four'' 4 years after Hurricane Katrina.
Now, I would like to give a special thanks to my colleague
Representative Emanuel Cleaver for joining me again today. And
I must share with you that we are on break from the House of
Representatives for the month of August. Many of our members
are traveling all over the world. They are in Afghanistan, they
are in Africa, they are just all over the world. But some of
our members decided that even if they took a few days to do
international work, that they were going to spend time on the
domestic agenda. So in addition to the work that Congressman
Cleaver is doing in his own home district, he thought it was
important enough to take time out to be here in New Orleans to
follow up on the work that we have been doing on the
subcommittee that I chair, the Subcommittee on Housing and
Community Opportunity, on which he serves. And so I would like
to thank him again for his commitment, and thank him for
closing out yesterday's hearing, and of course for the
attention that he has paid to this issue, Hurricane Katrina and
New Orleans and the rest of the Gulf Coast. I know when we
return to Washington, he is going to want to tell Congressman
Green and all of the other members of the subcommittee about
what took place here.
Now remember, Congressman Green was with us yesterday, but
he had to get back to Houston, Texas. He could not be here
today, but he is very much involved in this oversight and
follow-through that we are doing.
I am also pleased that we are joined by Representative Cao,
who represents this district. And without objection, Mr. Cao
will be considered a member of the subcommittee for the
duration of this hearing. I would like to thank him for his
quick response to our request to be a part of this hearing and
I would like to thank him for saying to us that not only would
he be present, but he too is interested in the subject of the
two day hearing; first of all, that which we talked about
yesterday, the Road Home Program, and of course, that which we
will be talking about today, the ``Big Four.'' So thank you,
Representative Cao.
Further, I believe that there are several members of the
Louisiana State Legislature, some who stood a moment ago when
President Hughes asked elected officials to stand. And I thank
you for being in attendance today.
Again, today's hearing will focus on the status of the
``Big Four'' 4 years after Hurricane Katrina. Yesterday, we
focused on the Road Home Program and I believe that yesterday's
hearing generated the possibility of some real solutions that
Mr. Cleaver, Mr. Green, and I can work on when we return to
Washington. And I am hoping for a similar result for today's
hearing.
Commonly referred to as the ``Big Four''--B.W. Cooper, C.J.
Peete, Lafitte and St. Bernard--were the largest public housing
developments in New Orleans with over 4,500 units. While some
of these units sustained severe damage as a result of Hurricane
Katrina, most emerged from the storm with minimal damage, that
we think could have been repaired. Unfortunately, the decision
was made to demolish all of these units. Let me be clear, I
have always opposed the demolition of public housing and the
``Big Four'' was no exception. Nationally, we have lost over
200,000 units to demolition. This is why Chairman Barney Frank
and I are asking for a one-year moratorium on all demolition of
public housing nationwide.
I believe that the demolitions here in New Orleans were
especially problematic for several reasons.
First, many former residents of those developments were
dispersed around the country and were flat out excluded from
the decision-making process. HUD did not know where most of
these people were and claimed they did not want to return. I
knew that this was not true, because I traveled to cities such
as Houston and met with displaced public housing residents.
They all told me the same thing: They wanted to come back to
their homes.
Second, following Katrina, the number of homeless people in
the City doubled from 6,000 to 12,000. At the same time, rents
rose sharply. In fact, today, rents are over 50 percent higher
than they were before the storm. In light of this crisis in
affordable housing, tearing down a major source of housing for
low-income families just did not make good sense to me.
Third, the redevelopment plan that had been submitted by
HANO and HUD are troubling. Essentially, HUD was going to
demolish 4,500 units of public housing and build back 600,
about an 85 percent reduction in the number of units. Yes,
these units would be part of mixed-income developments, but tax
credit units and market rate units are unaffordable to
extremely-low-income families who predominantly live in public
housing. It seemed that the strategy was to only allow a
limited number of families to return and then to send the
others to the suburbs with vouchers in a city which had lost a
significant amount of its rental housing.
That is why I opposed the demolitions. Now as we all know,
the demolitions have taken place. Construction is currently
underway and I am concerned about what is being built back.
These developments simply do not have enough public housing
units. I am also concerned about some of the occupancy policies
that the private developers of these properties are
implementing. These policies, such as work requirements for all
adult household members, serve to further limit the ability of
residents to move to the new developments.
Lastly, I am concerned that some developments might not get
built at all. Problems in the tax credit market are affecting
the redevelopment of affordable housing nationwide. It seems
that B.W. Cooper and Lafitte in particular are challenged as a
result of tax credit issues. I am very much interested to hear
the impact of these challenges on the development of these
properties.
I look forward to hearing the witnesses' views on this very
important program. And now I would like to recognize Mr.
Cleaver for his opening statement.
Mr. Cleaver. Thank you, Madam Chairwoman.
Let me again thank you for the vision that you have to try
to make right one of the tragedies of our lifetime. This of
course was devastating to the people of New Orleans, but in
addition to that, this may represent one of our most
embarrassing moments for the Federal Government in its modern
history, the fact that we have been unable to rebuild one of
our own communities.
I took great pride in being a part of the vote to send $14
billion to this community. I was troubled to learn that one
company walked away with almost $1 billion of the $14 billion,
and that should trouble every taxpayer in this country.
The truth of the matter is we have the opportunity to still
get this thing right and hopefully we will secure from the
panelists today additional information that can be used when we
go to Washington to try to restructure the way in which the
Federal Government is doing business here in New Orleans.
Yesterday, and I do not know if she is still here, a woman
spoke with me for about 5 minutes and it haunted me all night
last night. She told me, while we were standing out in the
hallway, that her mother had to leave during Katrina and when
she heard about the Road Home, the mother became excited,
wanting to finally make it home. But because the road home was
filled with obstacles, she made it home, but she was in a
casket. She began to weep out in the hallway yesterday over the
fact that the only thing her 80-something-year-old mother
wanted while she remained on this planet was to come home, to
come to New Orleans. That is all she wanted, nothing
extravagant. She just wanted to come home and she came home in
a casket.
There are probably people all around the country who tried
to come home. Many of them have been hijacked on the road home
and I think that it is the responsibility of all of us to do
whatever we can do to change things. We are hoping to make some
adjustments, Mr. Mayor, in the legislation so that HUD will
have an easier time doing what they need to do. And hopefully
we can say we are moving into a new day and that one day
Chairwoman Waters will bring us back to say that the road home
indeed worked, that people did come home.
But let me just finally say this, and this is a little
problematic for me to even say, but some of the testimony we
have heard and some of the things that were told us in our
listening session yesterday morning, there have been some bad
people doing some bad stuff. And I think we have a
responsibility to try to correct it, because right now, the
road home is a road not taken.
Thank you very much, Madam Chairwoman. I yield back the
balance of my time.
Chairwoman Waters. Thank you. I now recognize
Representative Cao for his opening statement.
Mr. Cao. Thank you, Madam Chairwoman. I would like to thank
my distinguished colleagues--
Chairwoman Waters. Would you speak up so they can hear you
way in the back?
Mr. Cao. Thank you very much.
First of all, I would like to thank you, Madam Chairwoman,
for taking a leadership role in the Congress in regards to the
housing issue here in New Orleans. I would like to thank
Congressman Cleaver for spending his recess here in our great
City. And I would like to thank Dr. Hughes for her generosity
and for the friendship that we have been able to establish in
the last several months in working together in order to bring
this City back and to push the whole recovery process forward.
For the last 8 months, we have worked very hard with the
State leadership as well as City leadership to address the
housing issues of our people here in the great City of New
Orleans. I understand some of the positions that they took,
obviously in facing an issue that was unprecedented. Many of
the leadership of the City wanted to rebuild in a way that can
provide the people with the best possible environment in order
for the people of this great City to live and to raise their
children. Obviously, there are issues in any recovery process
and in any decisions that members of leadership have to make.
And I applaud your leadership in trying to look at some of
these problems and trying to look at some of these issues and I
hope that we, as members of Congress, can work together in
order to address the housing needs of this City and hopefully
through our concerted effort, we can push forward this whole
recovery process in this region.
Thank you very much.
Chairwoman Waters. Thank you very much, Congressman.
I am now going to call on our first panel: The Honorable C.
Ray Nagin, Mayor of the City of Los Angeles; the Honorable
Sandra Brooks Henriquez--
Mayor Nagin. You just gave me a new job.
Chairwoman Waters. What did I say?
[laughter]
Mayor Nagin. Please do not do that.
Chairwoman Waters. It means that I am thinking about home.
The Honorable C. Ray Nagin, Mayor, City of New Orleans; the
Honorable Sandra Brooks Henriquez, Assistant Secretary for
Public and Indian Housing, U.S. Department of Housing and Urban
Development; and Mr. Wayne Woods, General Counsel, Housing
Authority of the City of New Orleans.
With that, let us start with the Honorable C. Ray Nagin,
the Mayor, who has been through every step, every inch, every
problem, every success, all that has to do with Katrina and
everything that has happened since. Thank you for being here
today, Mayor Nagin. We welcome your testimony.
STATEMENT OF THE HONORABLE C. RAY NAGIN, MAYOR, CITY OF NEW
ORLEANS
Mayor Nagin. Well, thank you to the Honorable Chairwoman
Maxine Waters, to the members of the subcommittee, to
Congressman Cleaver, and Congressman Cao. I want to thank you
for this opportunity to address you today, and for your
persistence in making sure that the struggles and the
challenges that New Orleans faces stay on the national stage,
if you will, and it does not go away.
Congresswoman Waters, you have been here from the
beginning, you have seen all of our challenges and struggles
and you have been working tirelessly, and we in New Orleans,
all of our citizens thank you so much for everything that you
have done.
I want to go really quick and touch on a couple of key
areas, as you asked me to. First, let me tell you a little bit
about where New Orleans is in its progress in the recovery and
then I will talk to you a little bit about the ``Big Four.''
Madam Chairwoman and members of the subcommittee, the City
of New Orleans has gone through a lot. We are facing our--
coming up on the fourth year anniversary of Hurricane Katrina
this August 29th. Our recovery strategy is working, but I must
be very blunt with you and let you know that the dollars that
you approved many years ago are just starting to flow to the
City of New Orleans.
When you talk about the $14 billion that was allocated, a
lot of that went to the Road Home Program, most of it went to
hurricane protection, but out of that $14 billion, only about
$411 million was allocated to the City of New Orleans for
disaster recovery--that is it. And we had a $14 billion need.
But in spite of all that, we have been able to move, press
ahead, and make progress. Our population sits at about 80
percent of our pre-Katrina numbers and our citizens continue to
come home. As a matter of fact, it was recently announced that
New Orleans was the fastest growing city in America for cities
above 100,000 people. So we continue to be amazed at the
resiliency and the dedication and the determination of our
citizens.
We are directly managing about $1.2 billion in recovery
projects and most of that is FEMA related repairs that the City
is managing directly. About $640 million of that is street
repairs.
My staff informed me that there was some talk yesterday
about us sitting on $200 million. Let me see if I can clear
that up. I do not know which $200 million they are talking
about, but I will let you know what we are dealing with. The
State, in its wisdom, our State legislators, we knew we had
shortfalls, significant shortfalls in FEMA funding, so they set
up for us a $200 million revolving fund that was designed to be
gap financing until FEMA caught up with what it really cost for
us to do repairs. We have that fund, we have been using it, and
right now it is at about 70 to 75 percent of those dollars are
appropriated, and as a matter of fact, if FEMA continues to
stay where they are today, we will run out of that pot of money
by November.
I do not know if they were talking about the $411 million
that we got from the disaster CDBG money. But 93 percent of the
projects that we have sent up to the State have been approved
or are either in the final approval stages and most of those
projects are moving forward.
So I am not sure. If there is some money sitting around, it
is not sitting around at the City level.
We have made progress with bringing back our performing
arts, the Mahalia Jackson Theatre for Performing Arts has been
brought back on line. We recently announced a big deal with
Nickelodeon. They are coming to New Orleans with a company
called Southern Star to revitalize the Six Flags site that has
been shuttered since Hurricane Katrina. We have had successful
Sugar Bowls, Super Bowls, Essence, Mardi Gras--you name it, our
economy continues to improve.
Our unemployment rate is among the lowest in the country,
if you can believe that. New Orleans has been also named as the
fifth best city in America to get a job. Business Week has
voted us as one of the best cities to ride out the national
recession.
But we still have our challenges, so I am not going to
totally say that everything is peachy keen. We have many, many
challenges in our City as it relates to crime fighting, as it
relates to post-Katrina stress that is still in our community
that is manifesting itself in suicides, attempted suicides in a
number of cases that our police officers deal with.
Let me turn my attention to the ``Big Four.'' You know, we
had many tough decisions to make after Hurricane Katrina. Most
of those public housing developments were in a state of
disrepair before Katrina and then we had some flooding that
occurred, and we had some delays in repairs. So the decision
was made to move forward to try and create a better model. But
we put some conditions before we would allow HUD to move
forward with the demolitions and the major redevelopment of
those units.
First, we said we would like to see a mixed-income model
that basically would not concentrate any demographic or any
income level in any one particular area of the City, but we
wanted to make sure that all public housing residents were
properly taken care of.
Before we would allow them to move forward, we wanted
verification of full funding of the tenant protection program,
which we got.
We wanted evidence that the 4,500 units would either be
rebuilt or there would be Section 8 vouchers or vouchers
associated with those tenants so that every tenant would be
taken care of.
We wanted documentation of their redevelopment financing
plan, which we were able to get.
And we wanted executed development contracts to make sure
that they were ready to move forward and we got those.
And then finally, we also made it a requirement that we
wanted to see a memorandum of understanding with the resident
councils to make sure that the residents had some input in
these developments and we were able to obtain that.
Now what is our long-term vision for the ``Big Four'' and
for all public housing? We want to make sure that every
resident who was here before Katrina has affordable housing
that is better than what they had pre-Katrina. We want to make
sure that HANO would have, as it moves forward, low vacancy
rates, that they would maintain up-to-date waiting lists, that
they would have timely response for maintenance. We want to
make sure that all of the renovations and reconstruction were
completed on a timely basis and we wanted a reasonable budget
sufficient in the future for appropriate maintenance. And
finally, we wanted to make sure that this development or this
housing authority was returned to local control so that the
citizens could have more input on what goes on in the future.
Let me close by talking to you a little bit about the
affordable housing situation in New Orleans as it exists today.
Hurricane Katrina damaged or destroyed more than 57,000 rental
units in the City of New Orleans, 75 percent of those were
affordable to citizens earning 80 percent of the area median
income. Shortly after the storm, the Federal Government
increased the amount it would pay for vouchers. This had the
effect of pushing rents up in the community when supply was
down. We saw a 46 percent increase in rents from the year 2005
to the year 2008. In addition to that, we also see in the City
of New Orleans a percentage of renters who spend more than 30
percent of their income on housing costs, increased more than
30 percent, from 48 percent to 54 percent.
We have focused on making sure that more affordable units
come into the marketplace, we have invested over $26 million to
leverage 1,700 affordable units that are either on line or
coming on line. And if everything continues with the current
trend, by 2011, 2012, we should have 36,000 affordable units
back in the City of New Orleans. That will take us, you know,
pretty close to what we had pre-Katrina, which is a little
ahead of the population trends that we are seeing today.
Another big need that we see in the community--and you
talked about this yesterday--is there are many citizens in our
community who did not receive enough from the Road Home Program
or the insurance companies, so there are gaps that they need
filled. We put together a program where we have put out in the
community forgivable gap loans of $35,000 to help primarily
senior citizens and disabled people, to see if they could fill
those gaps.
Our goal in this renewal of New Orleans is to hopefully get
to an environment where New Orleans can have a homeownership
rate that is closer to the national average. So we are putting
as many resources as we can, Madam Chairwoman, into helping
those homeowners to complete their repairs. Also to have a very
aggressive soft second program that allows young people to
become homeowners or anyone in the community to become
homeowners. It is a $65,000 program where you can have a soft
second to help you become a homeowner.
Madam Chairwoman, I want to thank you for coming to New
Orleans once again. The ``Big Four'' are a big part of our
history and the fabric of our community and from what we gather
from HUD and HANO is that those projects are moving forward. We
have one development that has some financing issues, but the
others seem to be moving forward and we want to keep this
momentum going and hopefully we will have better housing for
all of our citizens.
Thank you.
[The prepared statement of Mayor Nagin can be found on page
94 of the appendix.]
Chairwoman Waters. Thank you very much, Mr. Mayor.
Now, we will hear from the Honorable Sandra Brooks
Henriquez, Assistant Secretary for Public and Indian Housing,
U.S. Department of Housing and Urban Development.
STATEMENT OF THE HONORABLE SANDRA BROOKS HENRIQUEZ, ASSISTANT
SECRETARY FOR PUBLIC AND INDIAN HOUSING, U.S. DEPARTMENT OF
HOUSING AND URBAN DEVELOPMENT
Ms. Henriquez. Thank you and good morning.
Chairwoman Waters. Could you speak directly into the
microphone so that they can hear you in the back?
Ms. Henriquez. I hope this is better.
Chairwoman Waters. That is better.
Ms. Henriquez. Thank you. Thank you and good morning,
Chairwoman Waters, Mr. Cleaver, Mr. Cao.
Chairwoman Waters. Straight into it.
Ms. Henriquez. I am honored to be with you today and to be
here on behalf of the Department of Housing and Urban
Development.
I want to discuss the progress we have made over the last 6
months and share HUD's vision for creating sustainable,
inclusive, and prosperous communities to provide affordable
housing choices for New Orleans' low-income residents and offer
greater economic and educational opportunities and to help New
Orleans move from recovery to revitalization.
Prior to Katrina, the Housing Authority of New Orleans,
which has been under HUD receivership administrative control
since 2002, was already transforming conventional public
housing to mixed-income developments. At the time Katrina
struck, there were 7,379 public housing units, of which 5,146
were occupied.
Since the hurricane, HUD and HANO have committed to provide
housing for all public housing residents and Housing Choice
Voucher holders wanting to return to New Orleans, and we have
prepared a redevelopment plan for the ``Big Four'' to
facilitate that return.
The redeveloped ``Big Four'' will encompass over 4,000
mixed-income units and the initial phases will result in 2,170
new units, including public housing, affordable rental,
affordable homeownership, and market rate rental units.
These initial phases use tax credit equity, CDBG funds,
bonds, HOPE VI, HANO capital, and other funds. And HUD also
obtained additional funding from FEMA and HANO contributed more
money through the Section 901 extension and worked diligently
to leverage resources through the Louisiana Housing Tax Credit
Program and the Louisiana Recovery Plan's Piggyback Program, to
maximize the number of affordable housing units developed.
Phase I construction is now underway at both St. Bernard
and C.J. Peete and by December 2010, Phase I construction will
be complete, along with the homeownership units, for a total of
948 new units. 1,326 units at St. Bernard will be complete in
2012 and 510 units at C.J. Peete will be complete by the end of
2011.
Both Lafitte and B.W. Cooper have experienced delays,
primarily because of the equity market downturn last fall.
Construction on the first sub-phase of Lafitte, or 134 units,
will begin immediately following next week's closing. Phase I
infrastructure work began at B.W. Cooper in January 2009 and is
projected to close later this year, producing 410 units. At all
``Big Four'' sites, former public housing residents of both
complexes will receive first preference for the public housing
units there.
Due to the delays that have affected Lafitte and Cooper,
the placed in service date of December 31, 2010, poses a
significant challenge. The Administration supports a
legislative change to extend the placed in service deadline to
December 31, 2012, and find an appropriate budget offset. We
will work with Congress to ensure that these projects can be
completed as planned.
Beyond the ``Big Four,'' HANO, in partnership with HUD and
the State of Louisiana, will produce more than 7,600 hard
housing units with 6,320 of those units serving 1,174 more low-
income families at the end of the redevelopment process than
were served prior to Katrina.
Chairman Waters, I want to make clear HUD's commitment to
creating affordable housing opportunities for low-income
families. HUD is equally committed to ensuring that these
initiatives, and all Federal housing programs, are administered
in a way that affirmatively furthers fair housing and equal
housing opportunity in New Orleans and across this Nation.
Within days of the President's inauguration, the
Administration, along with HUD, acted quickly to ensure that
families receiving assistance under the Disaster Housing
Assistance Program, or DHAP, would be given additional time to
transition to permanent housing solutions before DHAP came to
an end.
So with our Administration partners, we announced the
Transitional Closeout Plan for DHAP families. This program
provided rental assistance and additional time to transition
families off temporary housing and into permanent housing.
Altogether, nearly 350 public housing agencies across the
country assisted in serving more than 31,000 displaced
families.
As part of this effort, public housing agencies have issued
more than 11,000 vouchers under an $80 million special
appropriation from Congress, of which 4,200 have been issued by
HANO to DHAP families here in New Orleans. HUD and FEMA have
also agreed to provide 2 months of additional transitional
rental assistance to families in the HCV pipeline. This
assistance ends October 31, 2009.
By the end of December 2009, we expect that this number of
vouchers should go from just under 9,000 pre-Katrina to about
15,000, including 4,400 vouchers to replace units demolished as
part of the ``Big Four'' redevelopment. In summary, there are
now significantly more assisted housing opportunities for low-
income families in New Orleans than existed pre-Katrina.
I want to be clear, public housing transformation is still
a top priority for HUD. But housing surrounded by disinvestment
and failing schools has virtually no chance of success.
Choice Neighborhoods, which more than doubled this year's
funding under HOPE VI to $250 million, will expand upon the
legacy HOPE VI built by leaders like you, Congresswoman Waters,
by broadening the range of activities eligible for funding and
fostering better coordination between housing, schools, and
other supportive services.
In addition, we are investing $150 million in our
Sustainable Communities Initiative that will bring together
transportation and housing planning at the local level to
reduce costs and increase opportunities for working families
who spend nearly 60 percent of their budget on housing and
transportation.
We are incredibly excited to start this work and New
Orleans would certainly benefit from such a program.
I hope it is clear to every single person in this room
today that HUD is committed to working with you to make this
community whole again--to changing the game on the ground by
cutting through bureaucratic red tape and by making a strong,
inclusive community the foundation of our revitalization
efforts.
Thank you for this opportunity to speak with you today. I
look forward to your questions.
[The prepared statement of Assistant Secretary Henriquez
can be found on page 78 of the appendix.]
Chairwoman Waters. Thank you very much.
Mr. Wayne Woods, General Counsel, Housing Authority of the
City of New Orleans.
STATEMENT OF WAYNE WOODS, GENERAL COUNSEL, HOUSING AUTHORITY OF
THE CITY OF NEW ORLEANS
Mr. Woods. Good morning.
Chairwoman Waters. Good morning.
Mr. Woods. Honorable Chairwoman Maxine Waters, Congressman
Cleaver, and Congressman Cao, again, my name is Wayne Woods and
I am general counsel and chief operating officer for
communication and intergovernmental affairs for the Housing
Authority of New Orleans. Thank you for allowing HANO to appear
before you today.
As you no doubt know, HANO's work is critical to the
recovery of the City of New Orleans. Because we help the less
fortunate residents of our City with affordable housing, we
probably have more direct contact with people on a daily basis
than any other public agency in the City of New Orleans. What
we have learned is simple. We have made progress since Katrina,
but we recognize much work remains to be done.
Before Katrina, HANO had 5,146 occupied public housing
units. We currently have 2,254 affordable housing units
occupied. A large part of our strategy, however, in serving the
residents of our City is by the redevelopment of B.W. Cooper,
C.J. Peete, Lafitte, and St. Bernard, the ``Big Four.'' Allow
me to give you a brief synopsis of those developments to date.
At B.W. Cooper, there were 1,550 units, of which 963 were
occupied before the storm. KBK Enterprises and its development
partner, the B.W. Cooper Resident Management Corporation, are
redeveloping the site. Phase I demolition work has been
completed, public infrastructure work is about 40 percent
finished, and construction will begin as soon as the financial
closing takes place. Cooper will cost about $225 million with
Phase I at $138 million. Phase I will include 410 units. The
first units are expected to be available in spring 2010 with
Phase I completed by April 2011. Once the entire Cooper site is
completed, there will be 740 units.
At C.J. Peete, we originally had 1,403 units. When Katrina
struck, only 144 units were occupied at the time. Central City
Partners LLC, comprised of McCormack Baron Salazar, KAI Design
and Build and the New Orleans Neighborhood Development
Collaborative, is developing this site. Peete, which is now
called Harmony Oaks, will cost about $183 million to develop.
Peete will have 460 units when completed in December 2010 and
the first units are slated for occupancy before the end of this
year.
At Lafitte, we had 896 units, with 865 occupied just before
Katrina. The developer, Providence Enterprises Orleans LLC,
will offer affordable and market rate housing at a cost of $400
million. The community is being developed in phases. The first
sub-phase will see 134 on-site affordable rental units by
December 2010 and 47 on-site affordable homeownership units by
March of 2011. Work has already been completed on 10 off-site
homeownership units. The cost of the entire Phase I of the
development, which will include 812 units, is $246 million.
At St. Bernard, we had 1,464 units before the storm with
963 occupied. Columbia Residential is developing that site. It
is expected to cost $190 million for on-site development. Phase
I alone will cost $138 million and will see 466 units. Of these
units, 83 are expected to be completed by the end of this year
with the rest of Phase I by December 2010.
HANO's role in the redevelopment of the ``Big Four'' is
very important. The success of each of the developments hinges
upon our effectively exercising our role. HANO has the
responsibility for planning, coordinating, and implementing the
redevelopment of the site. In fact, HANO is a developer partner
on each of the development scenes. HANO has worked with HUD and
the State to identify capital funding that could be leveraged
to provide total funds necessary for each project and HANO
itself has committed more than $100 million of its own funding
to the development.
Because of the unprecedented amount of dollars that are
being expended by HANO, we have an excellent opportunity to
financially impact the lives of our citizens and our residents
who were part of our communities before the storm. As such,
HANO is committed to providing employment opportunities for its
residents and resident-owned businesses. Each developer is
required to provide a Section 3 plan for each project and
submit monthly reports detailing the status of Section 3
employment and outreach efforts. HANO has also assigned project
managers to each site to monitor compliance.
In order to re-occupy the units, HANO has adhered to HUD's
PIH Notice 2007-3. Among other things, the requirements give
families living at the site at the time of Katrina the first
preference to return. Additional site-specific re-occupancy
criteria were developed with residents, HANO, investors, and
the lenders. Selection and occupancy criterias were discussed
with residents in open meetings and with investors and lenders
during the financing negotiations.
Now on the selection of the ``Big Four'' developments, our
developments can only be a success if we have strong
development partners. To select the developers for Cooper,
Peete, and St. Bernard, HANO issued a request for
qualifications in October of 2006. Proposals were received in
January of 2007 and then HANO conducted a ranking. The HANO
Board voted in March of 2007 to begin negotiations with the
highest ranked respondents.
HANO received an unsolicited proposal from Providence
Enterprises to redevelop Lafitte in conjunction with
Providence's other planned projects in the surrounding
neighborhood. HANO requested HUD approval of a non-competitive
procurement and on August 2006, HUD granted such approval.
In closing, Congresswoman and the other Members on the
dais, these are challenging times for our City and for our
residents. HANO's leaders realize and understand that. As
affordable housing advocates, we understand the intricacies in
providing effective housing options to our low-income
residents. Particularly for the last 4 years, we have been on
the front line in providing service for the most vulnerable of
our citizens. We are proud of our work and are passionate about
what we do. But we recognize again that more still needs to be
done. We are committed to the members of our community and look
forward to continuing our advocacy with them in the future.
On behalf of the leadership of HANO, I thank you for your
time.
Chairwoman Waters. Thank you very much. I will recognize
myself for 5 minutes to begin the questioning of this panel.
Let me thank the panel for coming.
Mr. Mayor, I was particularly drawn to the program that you
identified, the $35,000 gap program for forgivable loans.
Mayor Nagin. Yes.
Chairwoman Waters. Could you tell us a little bit more
about that? How does it work?
Mayor Nagin. Congresswoman, what we did is we started to
get some feedback from citizens and from people in the
community that the Road Home Program was just insufficient. We
were hearing there were gaps of anywhere from $30,000 to
$50,000 per household. We were getting this from people who
were working in the community with a lot of volunteer help
trying to get a lot more of our citizens in their houses.
To make a long story short, we took $10 million of CDBG
money and we set up this program. We put together a lottery
process, we advertised it to our citizens and we were, to be
quite frank, blown away by the response. With the $10 million,
we could only help about 300 families. The response--on the day
of the lottery, there were 6,000 people who had signed up and
this was just for senior citizens and people who had
disabilities. That told us that we needed to expand this
program. So we now have another $10 million that we are getting
ready to put out on the street for that same group and we have
another allotment of disaster CDBG dollars that we will open it
up to working families, not necessarily senior citizens or
people with disabilities, the same program. And we should go
out pretty soon with that.
Chairwoman Waters. That is very good to know because that
was the center of the discussion yesterday about the gap, that
the assessments that had been done for repairs, the amount of
repairs exceeded sometimes the value of the house, the way the
houses were valued, etc.
Mayor Nagin. Yes.
Chairwoman Waters. So there needs to be some discussion
about what you are doing and what we are advocating perhaps
could be done further to assist these homeowners who find
themselves in a situation where they got much less than they
expected from the Road Home Program and many of them are left
with incomplete repairs and still needing to find ways by which
to complete their homes. So we will talk about that a little
bit later.
Mayor Nagin. Yes.
Chairwoman Waters. About the ``Big Four,'' I recognize, as
was said yesterday by our representative here from HUD that
public housing residents deserve good secure living situations
and housing. We all agree with that. And of course, some of the
reasons for demolition had to do with updating housing, making
sure that the living conditions were quality living conditions
with expanded kitchen and bathroom opportunities--we recognize
all of that, and I think we all agree to that.
But what we are still concerned about is the fact that
public housing residents were evacuated from this City and
placed in or led to other cities, whether it was Houston or
Austin, Texas; Atlanta; other places. And many of them who
wanted to return, of course, could not return by virtue of the
fact that they had lived in public housing and the public
housing decisions were not made very early on. They did not
know what was going to happen to them and they were not told
that they were going to be demolished.
Lafitte, for example, I think everybody agreed only had
damage up to the first floor or first two floors at the most.
Mayor Nagin. Right.
Chairwoman Waters. And many of the residents felt that it
certainly could have been rehabbed and since Lafitte was
talking about phased redevelopment, they could have brought the
people back and then in phased redevelopment, the people would
have been in their homes, the new development could have
started, then they could have taken over or been moved into new
developments and we had hoped to have one-for-one replacement,
and that did not take place.
Mayor Nagin. Right.
Chairwoman Waters. So many of them are still wanting to
come back. Some have gotten settled and they just do not think
there are going to be any real possibilities because the number
of units that will be replaced on the footprint will be
decidedly smaller than what they were prior to their leaving.
And there is all this talk about scattered housing and other
opportunities.
Mr. Mayor, what do you think is going to happen for those
people who still want to come back and who may have lived in
one of these developments and have not been contacted, have not
been told what is going to happen to them? What can they expect
and what do you think should happen?
Mayor Nagin. Well, you know, Madam Chairwoman, you know, I
think about this whole odyssey, I do not know what to describe
it as, you know, now. Right after Katrina, if you had been
President of the United States, we probably could have gotten a
better result and we probably would not have demolished
Lafitte. But unfortunately, you were not President, and I had a
President at the time who was pretty determined to do
demolition. And we were faced with the difficult task of
allowing those developments to just sit or to try and come up
with a compromise position that at least moved things forward
and made sure that every tenant had a tenant protection voucher
that protected them until the units were redeveloped in New
Orleans. And that is pretty much what happened.
Now what will happen to those residents? Our residents are
very smart. You know, most people when we were dispersed over
44 different States, our folks started moving closer and closer
back to New Orleans and they are now concentrated in Texas and
Baton Rouge and throughout the State. And they are coming back
to this City. And one of the things that kind of gives me some
comfort is the number of affordable housing units that are
being built in the City as we speak. If we continue the current
trend, there will be a place for those residents to come back
and monitor up close and personal the development of these
public housing developments that we refer to as the ``Big
Four.''
It is not a perfect solution, but at the time when you had
the biggest bank in the world, being the U.S. government,
headed up by the former President, that was the best deal that
we could get.
Chairwoman Waters. Thank you very much.
Ms. Henriquez, I know that this is a new Administration and
we have great hopes for philosophical changes and actual
implementation of different kind of policies that would
certainly better benefit those people who are in need of some
assistance from their government. And I know that HUD and
Secretary Donovan stepped into this with all that had happened
and you have to make some decisions about what you do and how
you do it. So we recognize all of that.
But what I am wondering is this, in your role of providing
public housing to residents who need it, have you taken a look
at whether or not there is a real database that is being
maintained of all of those residents who lived in this public
housing and we know where they are right now?
Ms. Henriquez. Someone in the audience just answered the
question.
Chairwoman Waters. But I want you to answer it.
Ms. Henriquez. I know. As I--I am new to this process and I
am learning more and more and I met with a group of resident
leaders last evening as well as with members of the HANO staff
yesterday afternoon and I do believe that we do know where a
number of people are. But I think that there may be indeed
folks that we do not know and we are waiting to hear from.
There have been a number of letters sent out, sometimes as many
as seven letters to household members who we think are
eligible, for example, for a tenant protection voucher, who we
have not heard from. We have done phone calls, we have done a
number of things. And I had asked which staff is doing it along
with consultants, to identify what we have done to outreach to
every single household that we have not yet heard from. And
that information is being compiled family by family. I think we
are getting there, but there is an opportunity as these
hearings go on, as other articles become more and more
prevalent in the newspapers and in the media that if there are
families anywhere in the Nation who were displaced because of
Katrina and who want to come back to New Orleans, that they
should reach out and contact the HANO staff. And we will try
and figure out if we have lost people or not and how to get
them reintegrated into the system that is available here.
Chairwoman Waters. Ms. Henriquez, I have always been
concerned about the database of residents who were evacuated. I
have always been concerned that we have systems and operations
that could keep up with those people and who would communicate
with them and at some point in time offer them the ability to
return either on the footprint or in some subsidized housing.
And we will have to keep talking about that. I believe that
Secretary Donovan is committed to that.
But I need to know whether or not you have personnel who
are dedicated to doing that kind of work and whether or not in
future hearings that we probably will have in Washington, you
will be able to describe to us exactly how it is working.
Ms. Henriquez. I will reiterate the Secretary's commitment,
the commitment of all of us at HUD, that we should not lose
families, we should know where they all are, and indeed extend
the invitation that if they want to come back home, they should
be able to do that.
Mr. Woods. Madam Chairwoman, if I may, I may be able to
answer and illuminate some of the efforts that have been made
to contact folks and I also have some--
Chairwoman Waters. Excuse me one second. I am going to get
to you because I know that is part of what you have been doing.
But HUD now has some oversight responsibility and management
responsibility.
Ms. Henriquez. That is right.
Chairwoman Waters. And I just want to make sure that
stepping into this and trying to get a handle on all of this,
that this is something that is being dealt with. And then I
will talk a little bit with you about how you are doing this.
But they need to supervise it, they need to manage it, oversee
it in some way. Because still, as I understand it, this housing
authority is under the jurisdiction and supervision of HUD; is
that right?
Ms. Henriquez. Yes.
Chairwoman Waters. Okay, so that is why I am dealing with
this first.
Ms. Henriquez. Madam Chairwoman, you are absolutely
correct, HUD is the administrative receiver and so it is
incumbent upon HUD for us to provide the leadership and the
oversight that you have just spoken about.
I have been handed a note and I need to go and actually
sort of touch and see it, but as I understand it, 73 percent of
the pre-Katrina families, who had a relationship with the
Housing Authority of New Orleans, have been located and
accounted for. And of those, about 2,800 are here in New
Orleans. But I will commit to you that we will find out where
people are and figure out a good successful monitoring system.
And again, try to identify as many families as possible whom we
have not yet been able to either identify or we have not yet
heard from, and be able to tell you in which category they
fall.
Chairwoman Waters. In addition to that responsibility, HUD
has the responsibility for overseeing the redevelopment of
these ``Big Four'' housing units. By now, I am sure you have
looked at whatever the contractual arrangements are with the
developers, you understand the financing problems that are
being experienced at least by one or some, you know that there
were timeframes developed and I want you, if you will, to give
me an assessment of whether or not these developments are
moving in a way that they will meet the deadline or the
timeframes that have been developed for them, whether or not
the financing is real, are there more problems than we know
about and whether or not we are going to realize the
fulfillment of the development of the ``Big Four,'' even though
it is not as extensive as I would have wanted it in terms of my
one-for-one replacement and what you do on the footprint as
well as off the footprint.
Where are we with all of this? Is this real? Is it
happening? And is it going to get done? What have you
discovered in the short time that you have been there?
Ms. Henriquez. From what I have seen thus far, I am
confident that what is going on at the two developments that
are under construction will meet the timeframes and the
deliverables as designed and as planned.
As I said in my testimony, there is a concern about the
placed in service dates. We are working through those issues
with all of the relevant parties and will need to work with
Congress about some extensions on the placed in service dates,
because right now, even if you were to close today, the
construction window on that placed in service by December 2010
is too narrow to do a competent, quality construction job and
deliver the product as designed and as promised. So we will
need to move that and work through those issues on the tax
credit side.
As I have looked at the plans, as I understand them at this
point, they make sense to me, having done similar development
work in my professional life at the Boston Housing Authority. I
think the plans are solid, I think the financing is solid. I
hope that the market rebounds so the equity amounts will be
higher, so that we can make sure that we can get to a final
product at least by the time we are saying, if not faster, more
quickly. And that would be my goal, to make sure that we keep
this moving and I will be looking to see with staff here and
with the City and with the developers, looking at reports,
following up, coming to see more often actually what is going
on on the ground, and to touch it and to look at it myself.
Chairwoman Waters. Finally, I believe that all of the
contractual arrangements include a commitment to what I suppose
would be guidelines or law in HUD that talk about the
employment of residents in the developments. Now let us just
start with demolition. How many residents were employed to do
demolition?
Ms. Henriquez. I do not know that and I am being handed a
piece of paper, because I do not know that.
Chairwoman Waters. I am sorry, I cannot--you would have
that information?
Ms. Henriquez. Yes.
Chairwoman Waters. Okay, for your oversight, you are not
focused on that yet, you do not have it.
Ms. Henriquez. I do not have that information. However, you
do know that there is Section 3 which requires resident
employment?
Chairwoman Waters. Yes.
Ms. Henriquez. And a number of the Assistant Secretaries,
starting with and including John Trasvina, the Assistant
Secretary for Fair Housing and Equal Opportunity, he and I and
the Assistant Secretary for Community Planning & Development,
Mercedes Marquez, have formed an internal task force to make
sure that the focus on Section 3 across all of HUD's programs
is not just on the books, but that it is real and that there
are deliverables and that there are goals. And we will make
sure from top to bottom that we reinforce that with housing
authorities, with cities, whoever spends and receives Federal
funds.
But in the moment here, at HANO, I do not have that
specific information.
Chairwoman Waters. I appreciate that, and I know, again,
that Secretary Donovan is supportive of the residents having
these opportunities as kind of required by law. And we have one
member of my committee, Ms. Velazquez from New York, who is
working on additional legislation to make sure that happens.
But for now, what I am going to ask Mr. Woods to do is to
help fill in the gaps about the implementation of the
contracts. While HUD is committed to making sure for the future
that this is done, these commitments were part of the
contracts, as I understand it, and so some work has already
started, been done. Demolition has taken place. How many
residents received jobs in the work that has already been
completed?
Mr. Woods. Thank you very much. And let me apologize first
if I breached protocol, but I--
Chairwoman Waters. Oh, no, no, no, no problem.
Mr. Woods. I just wanted to make sure that we had the
correct information that was part of the record.
Chairwoman Waters. Sure.
Mr. Woods. Again, HANO is very committed to making sure
that all of our residents have as many job opportunities as
they can at the site. As a native of the City, I would prefer
that there would be 100 percent of those jobs at the site to
be--
Chairwoman Waters. I just want to know how many got jobs.
Mr. Woods. Absolutely.
With regard to the C.J. Peete development, we had a--there
is a construction training program at the development. There
has been a total of 20 graduates of the program who have been
hired by the developer--a total of 43 residents.
Chairwoman Waters. Okay, let us hear Mr. Wood, let us hear
what he has to say. He is going to give us some real numbers.
How many people got jobs at C.J. Peete?
Mr. Woods. We had 20 who were part of the--who were hired
by the developer, they were graduates of the--
Chairwoman Waters. They are still in the training program?
Mr. Woods. No, they are graduates of the training program.
Chairwoman Waters. They graduated and they all got jobs?
Mr. Woods. That is correct.
Chairwoman Waters. Twenty three.
Mr. Woods. Twenty.
Chairwoman Waters. Twenty, okay.
Mr. Woods. There has been a total of 43 residents who have
been hired in connection with redevelopment at that site, at
C.J. Peete.
Chairwoman Waters. At C.J. Peete, you had 20 who went
through the training program, or 23, and 20 got hired and you
have some more who received jobs also?
Mr. Woods. That is correct.
Chairwoman Waters. How many more, 20 more?
Mr. Woods. It was 20 who graduated from the program and
were hired by the developer and there are a total of 43
residents who have been hired, so that would be an additional
23.
Chairwoman Waters. And could you give me some examples of
what kind of jobs they got?
Mr. Woods. Well, they would have gotten, through the
construction training program--
[audience disruption]
Chairwoman Waters. Excuse me, let us hear what Mr. Woods
has to say just for a minute. Let us hear what he has to say.
Mr. Woods. Through the construction training program,
again, that was developed by the developers, they were trained
in journeyman type activities. So what would happen is they
would get, you know, basic jobs, not necessarily licensed
electricians or plumbing jobs, but they would get basic jobs
and the hope would be that on the job site, they would get
additional training and additional experience so that they can
move on and do additional--
Chairwoman Waters. So the 23--the first 20 who were in
training programs, they were assistants to electricians and
plumbers and those kinds of jobs?
Mr. Woods. Right, those folks had no experience in
construction at all.
Chairwoman Waters. Okay. And the other 20?
Mr. Woods. The other 23 would have been folks who would
have already had some construction training, would have put in
job applications and would have been hired at the site.
Chairwoman Waters. And at C.J. Peete, are these 43 still
working now?
Mr. Woods. I believe so. I do not know for sure, but I do
believe so.
Chairwoman Waters. All right, and let us go on to the other
developments.
Mr. Woods. And if I can, the jobs were in the areas of
masonry, painting, and sheetrocking work.
Chairwoman Waters. Thank you.
Mr. Woods. With regard to B.W. Cooper, there have been 15
residents who have been hired by the demolition and
infrastructure contracts and additional Section 3 residents
will be hired when construction begins.
Chairwoman Waters. This is at Cooper?
Mr. Woods. This is at Cooper; yes, ma'am.
Chairwoman Waters. How many employees are on the job
totally with the construction company?
Mr. Woods. I am sorry?
Chairwoman Waters. The construction company has employed
totally, non-residents and residents, how many, so I can find
out what percentage that 15 represents--
Mr. Woods. I do not--
Chairwoman Waters. --of all the jobs.
Mr. Woods. I do not have that information, that probably
can be garnered from the developer at the site, I know that
they are prepared and have presentations to do so.
With regard to St. Bernard, I understand that there are 600
residents who had been identified as potential job hires.
Chairwoman Waters. What does that mean, identified?
Mr. Woods. They have been identified, they have gone
through either the application process or--been part of the
application process to begin working for the site. Again, the
developer--
Chairwoman Waters. Has all of the demolition been done at
St. Bernard?
Mr. Woods. Demolition has been completed at St. Bernard and
we are actually in construction now.
Chairwoman Waters. So how many residents worked during the
demolition period?
Mr. Woods. I do not have that for St. Bernard or for--
again, that would be information that the developers would have
and I do not have the current Section 3 employment.
Chairwoman Waters. Okay, I understand. Go right ahead. Of
course, Lafitte has not been demolished, is that right?
Mr. Woods. Well, Lafitte has been partially demolished. As
you recall, there are 94 units that are still standing at the
site.
Chairwoman Waters. That is right. And how many residents
worked on that portion of the work, the demolition, for
example, of Lafitte?
Mr. Woods. Again, for Lafitte, I do not have that. Again,
that can come from the developer himself.
Chairwoman Waters. Okay. All right, now you wanted very
much to add to the information from Ms. Henriquez about the
database and how you maintain that database and how you are
able to keep up with the residents.
Mr. Woods. Right. The database is actually maintained by
HUD and the PIC system and so--
Chairwoman Waters. Oh, that is maintained by HUD?
Mr. Woods. It is maintained by HUD. I have the data of the
actual percentages of folks that we have been able to contact.
In addition to that, what we have done is every time that
we have had any type of major initiative, we have advertised,
not only here in New Orleans and in papers across the State,
but we also advertised obviously in Houston, Atlanta, Dallas,
Memphis, Jackson, and other places where we know that our
residents are living. So for instance, we are now about to open
up the Section 8 waiting list. We will have advertisements that
I think began appearing today in the paper, or begin appearing,
excuse me, August 23rd. So that folks who are interested in
being part of the Section 8 waiting list, there is a period
from September 6th to the 12th when they will be able to apply
to our waiting list. And so we hope that will open up very
soon.
And we did the same process for our public housing waiting
list, which we just completed that process.
So our goal has been to try to contact as many of the
residents as we possibly can, wherever they are. We can only go
by the addresses that we have, and as Secretary Henriquez said,
there are several times that we have sent out several letters
and continue to mail out letters to those folks.
I think that the important part, particularly for those who
have not maybe come back yet or for those who have not
transitioned from DHAP to the traditional Section 8 voucher
program, we are now starting to deal with our hardest to house,
folks who may miss appointments or folks who may not respond to
mail, so what we have to do and be focused on, I believe at
this point, is to do even more intrusive case management for
those folks that we are dealing with now because we have to
take an extra step. For instance, one of the things that we are
doing in the Section 8 program is we have an actual mobile
outreach unit. So if we are not getting responses from folks,
if we are mailing out and they are missing appointments or not
coming in or not submitting information, we are dispatching
folks to their residences. And we have to do this, particularly
I think, for our elderly and our disabled population.
So I think that we are trying to figure out a way to make
sure that we are actually touching everyone as much as we
possibly can.
Chairwoman Waters. Thank you very much.
And I would like to thank my colleagues for indulging me
with this length of time that I have taken on this questioning.
And Mr. Cleaver, I am going to turn it over to you.
Mr. Cleaver. Thank you, Madam Chairwoman.
Mr. Mayor, thank you again for being here.
Yesterday, we learned that the Secretary is at least trying
to figure out how to make some adjustments in the Neighborhood
Stabilization Program so that the City residents can benefit,
because many of the residents here did not suffer from
foreclosure, which is what the program is aimed at correcting.
Mayor Nagin. Right.
Mr. Cleaver. Or ministering to, but because of the flood.
So I think that is going to happen, that was testimony we
received yesterday from HUD. And so that would grant you I
think some additional ability to make an impact in the
neighborhood.
Is there anything that we can do legislatively that would
help you as you continue to try to rebuild the City?
Mayor Nagin. Congressman, the biggest thing--you know, now
the State of Louisiana has asked me to join them in lobbying
Congress and the Administration to have more flexibility with
the unspent dollars that they still have at the State level.
All of the recovery dollars flowed from the Federal
Government to the State and then to the City, and as I stated
earlier, we got $411 million out of $14 billion. It is my
understanding that there may be as much as $3 billion that is
still unspent and they are going to come to the Congress and
ask for some flexibility and waivers. And on top of that, there
is another $1.2 billion in hazard mitigation dollars that I
have not seen a report on how that has been spent.
Before you grant those waivers, I would ask you to make
sure that the dollars that Congress originally intended to come
to New Orleans come to New Orleans expeditiously. And the
formula that everybody agreed to way back when, when we were
lobbying for this money, is that New Orleans received 57
percent of the State's damage, damaged buildings and damaged
residences during Hurricanes Katrina and Rita, and therefore,
that should be the percentage that should come to this City. I
just have not seen that, Congressman.
So before you issue any waivers, make sure that there is a
hard core rule that those dollars have to be spent in the most
devastated areas.
Mr. Cleaver. Would you give us an estimate of what
percentage you may have gotten?
Mayor Nagin. You know, it is hard to really say because a
lot of the money that came down was spent in State-controlled
assets that reside in New Orleans and I do not have those
numbers. So maybe you can get them because I have been asking
for them for a long time.
Mr. Cleaver. I will get those numbers.
As a former mayor, I said then and I will continue to say
now, one of the biggest mistakes that was made was sending the
money to the governor. That was a mistake.
Mayor Nagin. Amen.
Mr. Cleaver. And I think we need to reverse that.
Mayor Nagin. I think what most people do not understand is
that when you send money from the Federal to the State, a city
can only go as fast as the State's approval process. And last
year, mid-year, was the first time we got approval on any of
that disaster CDBG money. And then after you get approval, you
have to go through the environmental studies, which take
anywhere from 4 to 6 months. So we can only move as fast as the
State will allow us to move. And that has just been a real
challenge with this recovery.
Mr. Cleaver. Yes, I am troubled by it. I learned yesterday
that a sizeable portion of the money went to some chicken
factory here in the State. I am not asking you to respond to
that, I will try to find out more about it when we get back to
Washington.
Mr. Woods, thank you for being here. We approved just under
a billion dollars in a stimulus package and a large portion of
those stimulus dollars, a sizeable portion, was allocated for
PHAs. What is--do you know what amount your PHA has received?
Mr. Woods. Just a little over $34 million.
Mr. Cleaver. Now will the $34 million be used to augment
the work that has gone on, or will the $34 million be used to
do--we have a little different world here in New Orleans than
in Kansas City, Missouri, where we are using the PHA allocation
to do weatherization, we are hiring people from the PHAs, they
get trained, they are trained in auditing and then
weatherization. But with money having already been spent and
being spent to rehab the PHAs as a result of Katrina, does the
$34 million you received have flexibility so that you can
perform some additional rehab work on properties, or do you
have to use it for weatherization?
Mr. Woods. No, we are actually doing a whole bunch of
things at different sites. What we did was we had a meeting in
consultation with our resident advisory board to determine
where that total $34 million was going to be spent. So we are
spending a significant portion at the Guste development, we are
spending a significant portion at our scattered sites, and we
are spending a significant portion also at the Iberville
development. So all of the $34 million is being allocated to
developments that are not part of the ``Big Four,'' but are
being allocated at the other sites that we either manage or own
or are managed by someone else.
Now what we have done, for instance, at Iberville, we spent
about $3.4 million, allocated $3.4 million at Iberville to do
some upgrades and cosmetic work to the exterior and interior of
the units. What we have done at Iberville, in collaboration
with the Urban League, is we have been able to hire 35
residents at Iberville to actually perform the work.
And we are hoping from that program that we have instituted
there, that those residents would be able to again obtain some
job skills and take those jobs skills hopefully on the market.
So that work is continuing right now, going on right now as we
speak.
Mr. Cleaver. So, Ms. Henriquez, was a waiver required?
Because the legislation, as I remember it, does not--has not
been allocated to do some of the things that Mr. Woods just
discussed. I am not mad about it, I am just--I just want to
know was a waiver required?
Ms. Henriquez. No, the round of the $34 million that he is
talking about comes out of the first traunch of the $3 billion
or the $4 billion that was set aside for public housing
authorities. It was delivered by formula, so housing
authorities could use it as capital money and, therefore, they
could use it for gap financing or they could use it as well, as
described by Mr. Woods, to do repairs consistent with an
ongoing program that was laid out by a particular housing
authority, as he has described it here.
Mr. Cleaver. Did you develop a training component? One of
the things that we are trying to do, as you know, is--I think
we are going to have an industrial revolution that many of us
missed out on or our parents and grandparents missed out on at
the turn of the 20th Century. This revolution will not be an
industrial revolution as such, but will be a green revolution.
And if we do not have green collar job training, I think we are
going to miss out again. So I am wondering if there is in place
green collar job training, because if we are going to make
green the new--the rehabbed units, the ``Big Four,'' or the
others for that matter, we are going to have to have people who
do it.
In many of the cities, we are having green collar job
training and those who complete it are certified as green
collar job specialists--I am sorry, as weatherization
specialists. And then some of them are even opening up their
own companies to do this kind of work.
So I am not concerned yet, but I may be concerned after you
answer.
Mr. Woods. Well, I will answer in two fashions. First of
all, with regard to the stimulus dollars, we cannot use those--
that funding is only available for capital outlays. So what
HANO has done is the actual training that we are providing to
those residents is coming out of HANO's funds and that
training, albeit it is not a green training, it is a basic
training for those residents who did not have or were not
employed at the time that we started this program. And again,
that is why we brought on the Urban League to assist us with
that training.
Now overall, there is a weatherization issue all across the
State and the Louisiana Housing Finance Agency is actually the
entity that is administering the weatherization dollars for the
State that the State has received. I could speak about that as
the chairman of the board of the LHFA, but that is a whole
separate entity.
But what we have tried to do, and even in our development
plan, is to be green in everything that we are doing right now,
particularly what we are doing at Guste and other developments,
is to make sure that we are doing green building, because we do
have to figure out a way to bring electricity bills down, we do
have to figure out a way particularly even for our scattered
sites to bring down the cost of electricity bills and utility
bills. So that is part of what we have done in our needs
assessment, part of what we are focused on.
Mr. Cleaver. Let me just say--and I am glad that you are
doing that--let me suggest that you work with HUD to develop an
application to the Labor Department and we have a Secretary
there who I think is very sensitive to this issue. In fact, she
received the Kennedy Award for the work she did in energy
conservation in California. And the reason I am saying this is
we need to have certified auditors, energy auditors, and
certified weatherization specialists because if we do not, we
are not going to be able to produce the kind of workforce and
deliver the jobs that the President stipulated when he put
forth the stimulus package.
And I am not talking about HUD dollars, I am now talking
about energy, which was $60 billion in the stimulus package,
$60 billion. And many of the cities have opened up through
metropolitan community college systems job training and
creating the opportunity for the jobs because of all of the
green work that is taken place with the stimulus package.
Ms. Henriquez. Mr. Cleaver, you are absolutely correct. And
that was also an agreement between the two Secretaries of HUD
and the Department of Energy, to begin to get housing
authorities access to weatherization dollars, to figure out
other kinds of partnerships to really work across and out of
our silos across the Federal Government. And this is a prime
example of that.
Mr. Cleaver. So you do not need any help from us, you are
already moving in that direction?
Ms. Henriquez. We are already talking and moving in that
direction.
Mr. Cleaver. So when we come back, you are going to have
green collar job training coming.
I will yield back the balance of my time, Madam Chairwoman.
Chairwoman Waters. Thank you very much.
Mr. Cao.
Mr. Cao. Thank you, Madam Chairwoman.
Mr. Mayor, I have one question concerning the loan gap that
was implemented by the City. This is the first time that I
heard of it and I just wonder whether or not you adequately
conveyed this program to the public so that every elderly,
every person who is disabled in the City has access to this
program.
Mayor Nagin. Well, it was a new program, Congressman, and
we did some advertising and the response was so overwhelming
that we had to go back and find some more dollars to put into
the program. Simultaneously, we are talking to the State about
some of their excess funds, to really do it in a much bigger
way. But this is a very new program that we are just rolling
out.
Mr. Cao. Okay. And my next question is, first of all to
you, Mr. Mayor, and then secondly, to Secretary Henriquez. One
of the decisions, at least based on my understanding of the
decision that was made by the City, in connection with mixed-
income housing was to improve the quality of life for the
residents. Has there been a study that has been done, maybe
even a survey, to keep track of whether or not residents feel
better or feel happier with respect to the mixed-income units,
whether or not the number of crime incidents--has that been
kept in these mixed-income housing units versus what it was
before?
Mayor Nagin. I do not have that study. I know there have
been many studies, attitudinal studies, on our residents but I
am not sure there has been one focused primarily on public
housing residents.
Mr. Cao. Madam Secretary, is there, at the national level,
a study that has been done to compare the traditional housing
project versus the mixed-income projects that is being done in
the City of New Orleans?
Ms. Henriquez. There have been some studies that have
generally focused in large part on the effect on the economy,
and then secondly on growing the economic development and self-
sufficiency of residents. I do not have them specifically but I
certainly will look at the body of work and I can get that
information to you.
Mr. Cao. Thank you.
And my question to Mr. Woods, you stated that at the
Lafitte housing project there are 94 units that have not been
demolished, is that correct?
Mr. Woods. That is correct.
Mr. Cao. And are they ready--can people live in those units
or what has to be done?
Mr. Woods. Well, actually at this point, they are slated
for demolition. We have a notice to proceed that has been
issued to the demolition contractor. But we have done
previously, a couple of years ago, studies to determine the
feasibleness of reopening those units.
Now as you may know, those units were built back in the
1940's, they are brick masonry buildings. The plumbing in the
buildings currently have a diverter system. To explain a
diverter system, if you were married and your wife was taking a
bath, you could not brush your teeth at the same time because
the water could not move from the tub to the sink.
Likewise the energy systems at those buildings were built
to accommodate 1940's energy needs. So to include an air
conditioner and a cell phone plug-in and a computer and other
electronic items that we currently have today would overload
the system.
Now we estimate at this point that if we were able to maybe
gut and rehab the units, it would cost somewhere in the
neighborhood of about $400,000 to do so, per unit. However, it
is much cheaper to demolish the units and rebuild the units. I
think that they are absolutely beautiful buildings, I have a
lot of memories at that site during Mardi Gras. However, based
on the cost analysis that we have been able to get to date, and
again, that study was maybe about 2 or 3 years ago, it would
cost again, $400,000 per unit to just rehab to bring them up to
standards.
And then the other piece is that those buildings, if you
look at them, the stairwells are small, the bedroom sizes are
small, they do not accommodate the type of furnishings that are
currently being sold and that our residents are buying. And so
in order to be able to have what I consider to be a liveable
space, it would require us to rehab those units to an extent
that we would have to expand the size of the units.
You know, so those are the challenges that are facing us
and at this point it is just not economically feasible to rehab
those units to make them liveable.
Mr. Cao. And in addition to your position at HANO, you also
sit on the board of the Louisiana Housing Finance Authority, is
that correct?
Mr. Woods. That is correct.
Mr. Cao. What are some of the finance-related obstacles in
these projects being completed?
Mr. Woods. Well, as has been previously stated, again the
placed in service date is a big obstacle. If the placed in
service date is not extended, we are going to have potential
issues with some investors. Right now, the placed in service
date is December 31, 2010. What we are concerned about is
whether or not we will be able to complete construction by that
time.
The other thing that we are concerned about is also on the
exchange program under TCAP. Congress or the Treasury has
opined that GO Zone credits are not eligible for the exchange
program. Right now, credits are trading somewhere in the
neighborhood of 59 cents to 63 cents on the dollar. Under the
exchange program, those credits could be exchanged for about 80
cents on the dollar and it would allow additional funding in
order to complete development.
So I think those are the two largest obstacles that are
facing us right now for the completion. And that is not just
necessarily for the ``Big Four,'' but that is for a lot of the
affordable housing units across the State.
Mr. Cao. Mr. Mayor, you also stated that there--or at least
every time when I talk to the State, the State blames it on the
City; every time I talk to the City, the City blames it on the
State.
Is there a system of dialogue where you all can communicate
to see who is doing what and when so that there is no finger
pointing?
Mayor Nagin. We talk all the time and we make progress at
times and at times we do not make as much progress. This is an
enormous undertaking. The City by itself is managing over 300
individual recovery projects. That is before we start talking
about the community disaster money that is coming down. We talk
to them, but the rules at it relates to community disaster
dollars, there is just so many things you have to go through.
And everybody wants to move the money out fast, but the reality
is that it does not move fast in its current form. So there is
lots of frustration on both sides.
Mr. Cao. And I recently--if you would allow me just one
more question, Madam Chairwoman--I recently spoke with the
State in connection with its Small Rental Program. I know there
were issues with respect to that particular program, to allow
small and local contractors to be more involved. And we
proposed and we basically asked them to revise that particular
program to allow more small contractors, more local contractors
in this program. Based on your understanding of the program,
has the request been implemented?
Mayor Nagin. I could not speak on that particular program.
All I know is they allocated about $700 million to the program
and I think $690 million is unspent. So I do not know where
that program is going or what is the direction.
My frustration, Congressman, is that the City of New
Orleans can only move as fast as the State moves because of the
way the Federal laws are set up. And I am really concerned
about the $3 billion that is sitting up there. I do not know
how they are going to spend that any time soon and at some
point in time, you as a Congressperson, and the Administration
facing a huge deficit, is probably going to ask for that money
back. And that would be an absolute tragedy--absolute tragedy.
So if I could ask anything of this panel is to try and
figure out a way to help us to reduce some of the rules
associated with spending this money so that it can get to the
street and do some good for more people.
Mr. Cao. Thank you, Madam Chairwoman. I yield back the
balance of my time.
Chairwoman Waters. Thank you very much. I would like to
thank this panel for your participation. Let me just wrap up by
saying that you have probably seen--or you have already
testified to in some shape, form or fashion about the numbers
and the way the units will be replaced and who they will be
available for. This is an outline, a demonstration of that,
that was published in the Times Picayune, who clearly--and this
clearly identifies that, for example, at B.W. Cooper that had
1,546 units, even though 441 of them were unoccupied, basically
what happened over the years, it appears that when units became
vacant or they were not repaired or what-have-you, you just
took them off the market. And so 441 at B.W. Cooper were
unoccupied.
But look at this, in the planned units, only 143 are set
aside for public housing residents. At C.J. Peete, it is very
interesting in that of the 867 units over the years somebody
allowed 723 of those to go unoccupied, for whatever reason, at
C.J. Peete. And it looks as if only 193 units will be available
for public housing, people who meet that criteria, for public
housing, for a total replacement out of the 867 units, 460
units altogether, but again, only 193 for public housing.
At Lafitte, they appear to do better with only 31
unoccupied, a total of 896, and they plan on putting back in
812 but only 176 of those will be for people who meet the
qualifications for public housing. But look at this number, 392
of those will be for the tax credit units, which means that
most people who lived in public housing will not be eligible
for those. You understand? They have to be subsidized further I
suppose with the Choice vouchers or Section 8. And then you
have 244 of those that are going to be sold under the
homeownership portion of that.
And at St. Bernard, of 1,436 units, 473 were going
unoccupied. You are only going to restore 466 in total with 157
of those only being for those who are eligible under the
criteria for public housing with 160 of those for the tax
credit units that will require a subsidy for those who do not
make the required amount of income. And of course another 149
of those at market rate.
So I understand thoroughly, and Mr. Cleaver, who was a
mayor of a city understands, that you have the responsibility
for land use planning, the City does, I understand that.
Chairwoman Waters. I understand that, but you know, as
Members of Congress trying to carry out the intent of the
public policy that has been developed about how we are going to
deal with those people who cannot afford, who do not have the
salary, who do not have the money to pay for market rate
rental, we have the responsibility to make sure that the public
policy is implemented to provide these units. I am worried
about where these scattered units are and we will talk with you
more about that and we will talk with the developers and all
that. But this looks like what the City has been accused of.
And let me just say this, because I do not know, but the
City has been accused--and perhaps because the former Secretary
Mr. Jackson said it, he said--you know what he said, he said
something like this: That they were not interested in
maintaining the public housing units for poor people as we knew
them, in essence that the City was going to be less poor and
less black. Is that what he said?
So even though the goals of perhaps thinning out the public
housing units so that they are more liveable perhaps, all of
those goals may be commendable. But you cannot help but wonder
whether or not these policies are going to do precisely what
Mr. Jackson intended them to do.
Yes, ma'am?
Ms. Henriquez. If I might.
Chairwoman Waters. Yes.
Ms. Henriquez. I am not going to offer an opinion on a
former Administration. I can only tell you about this
Administration, of which I am a part.
Chairwoman Waters. I am sorry, you are not going to offer
an opinion about what?
Ms. Henriquez. On the former Administration.
Chairwoman Waters. No, please do not, you do not have to do
that.
[laughter]
Ms. Henriquez. I can offer an opinion and tell you about
this Administration, of which I am a part.
Chairwoman Waters. Sure.
Ms. Henriquez. This Secretary and this Administration are
committed to increasing and improving the numbers on affordable
rental housing. Homeownership is important, but not everyone
wants to be or can be or should be a homeowner. And so it is
our--we see it as our responsibility to create as many
affordable housing rental opportunities as possible in the
marketplace--not just here in New Orleans, but across this
Nation.
To that end, I have not seen the numbers from which you
were quoting; however, I will say that there are a variety of
affordable housing types based on how they are funded in a
redevelopment opportunity, such as with the ``Big Four.'' And
there are ACC or public housing units that come back with
public housing subsidies where the rent for the occupant family
is based on a percentage of their income. There are also tax
credit units which are affordable which may or may not meet the
income levels of affordability for some public housing
residents--
Chairwoman Waters. They will not, based on the formula that
I have seen.
Ms. Henriquez. --however, Section 8 vouchers can be--which
the family will have, could then create affordable living
spaces in those redeveloped units in the tax credit. So that
when we look at the totality of where public housing level rent
at 30 percent of your income, with or without a Section 8
voucher attached to you or to the unit, about a third of all
those units of the more than 7,600 we talked about, when all is
said and done, will come back as deeply affordable units at the
``Big Four'' and across this City. That is just what is going
on with what is being developed through HUD's formula, not what
else might be developed by other developers who have access to
affordable tax credits and so on.
Chairwoman Waters. I appreciate that very much. And as I
said, I am going to certainly dismiss this panel, but let me
tell you what it means when you have less units in public
housing, which may or may not be good, and when folks who are
part of a community are given vouchers to go distances from
where they have community connections and support. They
oftentimes find themselves in communities where they are not
wanted, they oftentimes find themselves in a community where
they have no transportation even if they are trying to get
trained and look for jobs. They oftentimes find themselves
alienated, isolated, and what you intend to do in maybe putting
them in maybe nicer four walls is creating all kinds of other
pressures and stresses.
So, you know, we have to keep that in mind and we are going
to have to follow this very closely. Again, this is already
done and we are not blaming this Administration certainly, but
we are concerned. And we have to follow this to make sure.
And lastly, Mr. Mayor, the homeless problem, as it is in
Los Angeles, is a problem here. And the Section 8 vouchers that
are going to become available, are they available to the
homeless also?
Mr. Woods. They would be available, anyone can apply and so
they would be available--
Chairwoman Waters. But they would not necessarily get the
newspaper that you are talking about advertising in.
Mr. Woods. Right.
Chairwoman Waters. Does a mobile van go to under the
bridges where the homeless are?
Mr. Woods. We have not started that outreach.
Chairwoman Waters. But it could happen, they could do that.
Thank you all so very much. You have been so patient and I
appreciate your cooperation, and again we will continue to work
with you.
Let us take the next panel so we can--what we really need
to do is we need to learn as much as we can about what they are
doing or what they have not done so that we can correct it. So
bear with me, bear with me for awhile.
Thank you all very much.
Ladies and gentlemen, we are going to move right into the
second panel, so I am going to invite those panelists to come
to the seats that are provided. For panel number two, we have:
Ms. Anita Sinha, senior attorney, The Advancement Project; Mr.
James Perry, executive director, Greater New Orleans Fair
Housing Action Center; Ms. Laura Tuggle, Southeast Louisiana
Legal Services; Ms. Cynthia Wiggins, HANO Resident Advisory
Board; and Ms. Angela Patterson, director, UNITY Welcome Home.
For those who are exiting the room, please do it quietly.
Others, please take your seats, the panel is in place. And let
me apologize, I spent a little bit more time than was allocated
because it was important for us to query those who have
responsibility for this redevelopment, to try and understand
exactly what has been done and what they are doing and what
kind of oversight they have.
So I am going to ask each of you, most of whom I have met,
I have worked with and it is so good to see you all again. Ms.
Wiggins, I came looking for you yesterday over at the park. I
do not know what happened, I may have missed a meeting but I
thank you all for being here and we are going to get started
right away. We are going to hold you each to your 5 minutes.
So let us begin with Ms. Anita Sinha, the senior attorney
for The Advancement Project.
STATEMENT OF ANITA SINHA, SENIOR ATTORNEY, THE ADVANCEMENT
PROJECT
Ms. Sinha. Good afternoon.
Chairwoman Waters. Good afternoon.
Ms. Sinha. My name is Anita Sinha, and I am a senior
attorney at The Advancement Project. I direct a--
Chairwoman Waters. Speak right up as much as you can so
they can hear you in the back.
Ms. Sinha. I direct our post-Katrina project which since
August 29, 2005, has helped residents fight for just
reconstruction in New Orleans.
I am also counsel on Anderson v. Jackson, a class action
lawsuit that continues to pursue justice for displaced public
housing residents of the ``Big Four.''
The 4-year anniversary of Hurricane Katrina is imminent.
The economic crisis plaguing our country has reared its head in
New Orleans where the rates of foreclosures, empty and blighted
properties, and homelessness are staggering.
I am both honored and dismayed to be testifying today.
Honored because this hearing is a very strong statement that
you, Ms. Waters, and the subcommittee know that the people who
continue to suffer greatly since Katrina are not forgotten. I
am dismayed though because over 4,500 public housing units have
been destroyed and big questions about redevelopment and re-
occupancy loom large.
There are presently less than 2,500 public housing units in
New Orleans, and even these units are at risk. We are deeply
concerned about reported plans to demolish the Iberville
development. Essential repairs and maintenance in Iberville
have gone unattended and we fear that this is yet another
example of disinvestment as a way to justify demolition. There
is no justification for demolishing Iberville, especially
before public housing units have been built on the ``Big
Four.''
We are also concerned about the 94 units at Lafitte that
HUD and HANO have spent million of dollars, about $29,000 per
unit to repair. I think the previous panel testified on these
94 units and Mr. Woods was talking about the cost to rehab or
something. But these units have been rehabbed, they have spent
millions of dollars on them and they sit vacant, and as Mr.
Woods testified, are slated for demolition. These units should
not be demolished. In fact, there should be a moratorium on any
further demolition of public housing in New Orleans.
As for the ``Big Four,'' we are concerned that families
most in need of housing will be left out or left for last. The
initial disposition plan for the ``Big Four'' was to rebuild
only a fraction, as you mentioned, Ms. Waters, about 15
percent, of the original public housing units. That was bad
enough, but now we are concerned that the current state of the
market will mean even less housing will be rebuilt.
Particularly of concern is what construction is financed past
phase I of the building on each site. For example, we really
would like to know whether Lafitte developers still can do one-
for-one replacement.
The other issue concerning reconstruction is whether
building a partial number of public housing units to market
based units is part of the initial phase of constructing the
``Big Four'' sites. We know that phase I is being completed or
has been completed, but we still do not know how many are
apportioned to public housing as opposed to how many public
housing is being left for later phases of redevelopment. We do
not think the public housing families should be the last to get
home and we would like to see their homes be built sooner than
they already are.
We are also concerned about re-occupancy rules. We believe
that residents of at least one of the sites, the site of St.
Bernard, are being subjected to illegal work requirements. HUD
regulations do allow for work preferences, which is giving
admission preferences to households where one family member is
working. But the law does not permit work requirements. It is
our understanding that the residents of St. Bernard have been
told by Columbia Residential that all adult household members
must have full time employment. And that is not what the law
says. Columbia also claims to its residents that HUD has
granted waivers to the developers so they can set such rules.
We have not been able to verify whether this is true.
The other issue is credit and extensive background checks.
These checks have been reported as ways to keep families out of
public housing. Now is the time to move obstacles out of the
way, not impose new hurdles in the path of displaced residents.
The last issue I would like to raise here is whether
employment opportunities from the redevelopment of the ``Big
Four'' are going to public housing residents as you know is
required by Section 3 of the 1968 HUD Act.
Each of the ``Big Four'' sites are subject to Section 3.
Part of HANO, HUD, and the developers' duties under Section 3
is to track the jobs given to residents. As Mr. Woods and Ms.
Henriquez testimony just showed, this tracking is not
happening. But the law says they must be tracking Section 3
jobs. Anecdotally, we know that jobs are not going to
residents. So we respectfully urge the subcommittee to closely
monitor Section 3 compliance, including receiving regular
updates from the new internal task force that Ms. Henriquez
just testified about.
I respectfully direct the subcommittee to my written
statement for further details on what was read in my testimony.
Thank you.
[The prepared statement of Ms. Sinha can be found on page
105 of the appendix.]
Chairwoman Waters. Thank you very much.
Mr. Perry, it is good to see you again.
STATEMENT OF JAMES PERRY, EXECUTIVE DIRECTOR, GREATER NEW
ORLEANS FAIR HOUSING ACTION CENTER
Mr. Perry. Same here, thank you.
Thank you, Congresswoman; thank you, Congressman Cleaver,
for the opportunity to testify. Of course, I run the Fair
Housing Action Center here in New Orleans, and before I get
into my substantive testimony, I wanted to offer two things.
One is a thank you for the hearing yesterday about Road
Home issues. My organization is the plaintiff in the lawsuit
against the Road Home organization in taking on this basic
issue of making payouts based on the value of homes rather than
the cost to repair homes. So it was very important to us that
you addressed that issue yesterday.
Second is that in the last panel, one of the questions that
you raised was about the data tracking residents who formerly
resided in public housing. In one of our lawsuits against the
housing authority in 2007, they were required to turn over
information about where residents were. And when we got the
list that they provided to us, many times they sent surveys and
information to addresses that were pre-Katrina addresses. In
fact, some of the addresses on the list were the addresses of
the public housing developments that were, of course, vacant.
So I can tell you that accounted for about 30 percent of the
mailouts, the survey that they provided to us in the course of
that litigation.
I am hopeful that the new Administration is working hard to
make sure that those lists are clean and accurate, but at least
during our experience in 2007 under the prior Administration,
those lists were far from accurate and far from reliable.
The thing that I want to focus on in my testimony is what
happens in the aftermath of demolition of public housing. You
know there is so much work and so much discussion around mixed-
income housing about whether or not it works, but with a
typical mixed-income development, what happens of course is
that the majority of the units and so the majority of residents
cannot return. In New Orleans, an example of that was the
former St. Thomas development where there had been 1,500
families. Only 246 units are reserved for low-income residents
at the new development, so there is a question about what
happens to the remaining more than 1,200 families, where did
they go? For the most part, they get Section 8 vouchers,
Housing Choice vouchers.
And so the fundamental issue, I think, during the time when
we are rebuilding housing and making sure there are enough
units--and there is a question about whether or not that is
being done effectively--is are people able to use the units--I
am sorry, the vouchers.
Well, just yesterday, my organization released a study
where we sent testers to apartment complexes and to small
landlords all across the City and inquired whether or not they
would allow a renter to use a voucher. What we found was 82
percent of the time, landlords refused to accept Section 8 and
Housing Choice vouchers. So the thing that is supposed to
bridge the gap right now for people who do not have public
housing to rely on is the Housing Choice voucher. But what
happens if landlords will not take the voucher?
Now this is a huge and very difficult issue. And it also
becomes racialized because 99 percent of people in the City of
New Orleans who rely on Section 8 and Housing Choice vouchers
are African American. So when landlords refuse to take vouchers
82 percent of the time, it has a disparate discriminatory
effect on African-American voucher holders.
In addition, we interviewed landlords and asked them well,
why did you not take the voucher, what was your reasoning for
denying folks based on the voucher? Sometimes we got very clear
racial comments. For instance, people said, we do not want
these people with dreadlocks living in our complex. I will read
you one quote that is extremely disturbing, from a landlord. He
said, ``I won't take vouchers until black ministers start
teaching morals and ethics to their own so that they stop
having litters of pups like animals and they are not milking
the system.'' And he refused to take the voucher based on that.
Now of course, generally people who live in public housing
and have vouchers have to have jobs. For the most part, people
work, right? Unless you are elderly or disabled, people work.
So these are generally unfair stereotypes and untrue
stereotypes about folks.
The second thing that landlords said consistently was that
they were frustrated with their own dealings with the Housing
Authority of New Orleans. Consistently they would make
agreements to take voucher holders in the past and what would
happen is that they would go 2, 3, sometimes 4 or 5 months and
never receive a payment. We talked to one landlord who said
that right now he is owed more than $5,000 by the Housing
Authority of New Orleans because they have not paid on valid
contracts. There is another large scale landlord who is owed
$25,000 by the Housing Authority of New Orleans. They also
talked about basic issues of folks just not answering the phone
and being discourteous.
And all of these things work to make it such that people do
not want to work with the Housing Authority and do not want to
rely on the voucher program.
So we are unclear about what is going to happen with hard
unit public housing. But in the meantime, we are relying on
vouchers and if vouchers cannot be used 82 percent of the time,
then New Orleans renters in New Orleans are going to be in a
very difficult position.
So I encourage and implore you and the subcommittee to look
at this issue and to consider it very heavily as you promulgate
legislation on these issues.
Thank you.
Chairwoman Waters. Thank you very much.
Ms. Tuggle.
STATEMENT OF LAURA TUGGLE, SOUTHEAST LOUISIANA LEGAL SERVICES
Ms. Tuggle. Good afternoon. Thank you, Chairwoman Waters
and Mr. Cleaver, for allowing me to come here today to testify
about remaining affordable housing needs almost 4 years after
Katrina. I especially also want to thank you for your
leadership in bringing recovery funds to our area.
I work at the Legal Aid office, which is called Southeast
Louisiana Legal Services. Most of our service area was severely
devastated by Katrina and the elderly, disabled, and low-income
families that we serve on a daily basis are still struggling to
try to obtain decent housing that they can afford. I know this
committee's interest and continued support will make a
difference in that daily struggle.
While tremendous resources have come our way, we still have
such a long way to go. We all understand that the tax credit
deals are in crisis, but even the tax credit deals that were
planned were only going to repair a fraction of what we lost,
only about 40 percent of our pre-Katrina affordable housing
stock.
There is also the looming end of the Disaster Housing
Assistance Program, or DHAP, at the end of this month for most
families. And the lack of affordable rental units, including
public housing that is actually ready now is extremely
troubling. Post-Katrina, we all know homelessness has doubled.
We are also faced with other non-``Big Four'' sites, such as
Iberville and the Florida site that may be on the chopping
block.
Frankly, for many folks, the road home is still under
construction, full of potholes, and the bridge is out. For
many, it has been a road to nowhere.
We are bracing ourselves here for the end of DHAP.
Thankfully, we have been allocated voucher funding to provide
permanent housing assistance to about half of the families
locally. But the conversion process has gone extremely slow and
additional extensions have been necessary, at least two so far.
Of about the 9,000 DHAP families in New Orleans, only about
half have been eligible for a voucher. That leaves us about
3,900 families who may have remaining unmet housing needs. Of
course, 850 of them are elderly and disabled families who have
been either denied vouchers or whose file is still in limbo.
While HANO and HUD have worked very hard to reach these
families, additional efforts are needed. We cannot afford folks
falling through the cracks and we can certainly not afford any
increase in homelessness.
Despite voucher funding for DHAP and extensions,
significant housing needs still exist, particularly for low-
income families with incomes between 50 to 80 percent of area
median income. Unlike other HUD programs, the income limit for
vouchers is only 50 percent of AMI. Because of the high rents
that pervade our City, many of our workforce families on DHAP
will still face significant affordability gaps when the program
ends in just a few days.
The situation is even bleaker for homeowners who are on
DHAP with incomes at these levels. Take Clarence, who is an
outreach worker at UNITY, getting people off the street every
day. He is worried that in a few days, he is going to have to
join them. He cannot get a voucher due to his income, his rent
is $995 a month, the mortgage on his Katrina-damaged home is
$935, and his income is only $1,800 a month.
There is a possible safety net for families like Clarence.
The LRA has allocated $5 million in CDBG funds for up to 12
months of temporary rent assistance. Unfortunately, the service
delivery system to administer this program is simply not ready.
If DHAP were extended for 2 more months for everyone, there
would be time for this program to kick in. Additionally, our
City is poised to get $7.5 million in homeless prevention funds
under the stimulus, which should be hitting the street sometime
in October. Our recommendations regarding DHAP are:
To extend it for everyone to allow a smoother landing as
new resources become available;
To review all prior denials and withdrawn status of elderly
and disabled families on DHAP for possible voucher eligibility;
and
To prioritize vouchers to families who moved out of FEMA
trailers when they were being pressured earlier this year.
Another huge problem is the current status of the HUD
multi-family stock, which we never hear talked about. This
stock of privately owned properties had a direct HUD subsidy
and provided thousands of deeply affordable units. Also, these
units had families in them with similar incomes as those in
public housing.
As of September of last year, HUD reported 3,314 units of
this multi-family stock was closed. Of that amount, 96 percent
had Section 8 project based contracts. Those contracts had been
suspended since Katrina. Many of the deals on the multi-family
side that were hoping to reopen are plagued with the same
financing gaps as public housing. Our community could wind up
permanently losing not only thousands of public housing units
but thousands of HUD assisted multi-family units. In addition
to the 3,300 units above, there are another 1,500 units that
have been lost from prepayments.
We would like to recommend in regard to multi-family stock
that:
Any suspended project based Section 8 contracts be
transferred to other deeply affordable properties if that site
cannot reopen; and
Tenant protection vouchers for all prepaid multi-family
sites be issued.
We need to get a report made to this committee from HUD on
the status of all multi-family housing and a report on the
issuance of tenant protection vouchers to 1,500 families.
Thank you.
[The prepared statement of Ms. Tuggle can be found on page
122 of the appendix.]
Chairwoman Waters. Thank you very much.
Ms. Wiggins, thank you. Again, I was at the park yesterday
looking for you, but I want to thank you for all your work, all
that leadership that you have provided to public housing
residents, and I look forward to talking with you.
STATEMENT OF CYNTHIA WIGGINS, HANO RESIDENT ADVISORY BOARD
Ms. Wiggins. Good morning, Congressman Cleaver and
Congresswoman Waters. On behalf of the Citywide Tenant
Association, we want to thank you for this opportunity to
present before you today. We also especially want to thank
Congresswoman Waters for her commitment and her dedication to
ensuring that the rights of low-income families and public
housing families were not being violated after Hurricane
Katrina.
In my written testimony, we presented information on all of
the public housing sites and not just the ``Big Four.'' Since
Secretary Donovan's swearing-in, we have been afforded the
opportunity to sit at the table and have conversations with the
housing authority with respect to the redevelopment that is
taking place at each of the public housing sites. So the
information that we provided in the written testimony is
information that we actually know is going on.
However, we do have some concerns with respect to the
Lafitte redevelopment and the lack of funding that has been
awarded to the B.W. Cooper housing development. It is our
opinion that HUD needs to allocate additional money for the
redevelopment at B.W. Cooper and I am certain Donna Johnigan
will speak to that following me.
In my written testimony, we talked about the Section 8
program, and while the Section 8 program has truly assisted
families here in New Orleans, we do believe that the
discrimination that Mr. Perry is talking about is real and it
is prevalent. Residents who are moving from subsidized housing
such as public housing are feeling threatened with homelessness
because of the utility costs, because of the enormous amount of
security deposit that is being asked for. They are feeling
threatened because landlords, those who choose to manipulate
the program, have placed them in leases that they cannot get
out of, some of them to the extent that they have threatened
the residents to get out because they were complaining about
the conditions that they were living in. We have some concerns
about the water bills that residents have been forced to carry
and take on water bills that were not their water bills. We
have residents who have been asked to pay utilities that were
not their utilities, where construction work was taking place
at their unit prior to moving in, and that utility cost was
passed on to them when they went to have the lights turned on.
While the Section 8 program is certainly a good program, we
are of the opinion that it is not for low-income families. It
is really for the working poor. And our elderly residents are
suffering, some of them are living in houses without utilities,
being very quiet about it because their living arrangement is
in jeopardy. When the lights are turned off, the housing
authority or the landlord is required to report it and then
cancel the Section 8 voucher. That is a great concern for us
and we have seen an enormous increase in our elderly residents
having no utilities and struggling with paying high light bills
and water bills.
Also, we want to make a recommendation to this committee
with respect to these lease agreements that our residents are
being forced to enter into. It is our opinion that the housing
authority should develop a lease, a lease that protects the
resident as well as the landlord, where there is a standard
lease that they can enter into and we do not have all of these
different lease arrangements.
We are also asking that HUD would mandate that there is a
limit on security deposits and base that security deposit on
the unit size. We have a lot of our residents who cannot come
up with $1,800. We have residents who have been evicted or have
been asked to leave by a landlord and the landlord would
literally fight them to the bitter end to keep from giving them
their security deposits even though they are turning the unit
back over.
We believe that there has to be some kind of control in
place where residents can go and file grievances not just with
Mr. Perry's office but for the housing authority about the
violations that are occurring with these landlords. Some of
these houses are substandard, some of the conditions are awful,
and we have residents in here today who will testify that some
of these houses are in deplorable condition and it is worse
than the units that we were living in when we were in public
housing.
We also want to say that the traditional public housing,
there are some old and outdated standards there that must be
changed. They must be changed because they do not conform to
today's standards. This housing authority does not conduct
market studies with utilities. The utility allowance is not
enough and it is not enough because the utility cost is going
up every year and there is never a market study done to make
the necessary adjustments. So persons who have to pay
utilities, their rent can be offset through those utility
adjustments.
We also have some concerns about some of the issues within
the housing authority admission and continued occupancy policy,
but the only way that we can address those issues is if the
regulations are changed.
Under the tax credit program, we believe that Congress
should mandate that HUD and the PHAs and the developers all
enter into an agreement that the tax credit ACC units and the
project based units incorporate the same standards for
occupancy. We have a difference in the occupancy standards and
we believe that you guys need to ensure that you do not have a
separation of what each developer is actually doing.
Again, we want to thank you.
Chairwoman Waters. Thank you very much. Thank you for being
here.
Ms. Wiggins. May I say one last thing?
Chairwoman Waters. Yes.
Ms. Wiggins. At the request of Elisha, we also believe that
HUD should be removed from the agency and that we bring in an
executive monitor to oversee the housing authority.
[The prepared statement of Ms. Wiggins can be found on page
154 of the appendix.]
Chairwoman Waters. Thank you very much.
Ms. Patterson, I know of your work. Please tell us what you
came today to testify about.
STATEMENT OF ANGELA PATTERSON, DIRECTOR, UNITY WELCOME HOME
Ms. Patterson. Chairwoman Waters, Congressman Cleaver, and
the other members of the subcommittee, we thank you for
inviting me to testify today on behalf of UNITY of Greater New
Orleans. And by the way, if I might digress for a moment, I do
not know, Madam Chairwoman, if you recall a moment when Martha
Kegel and myself were in Washington, D.C., advocating for the
recovery vouchers for the persons who were most vulnerable in
our community. And it was a very, very dark moment for us
because it did not look as though the vouchers were going to be
passed. And we met you in the hallways of Congress and you
said, ``That's not going to happen.'' And it passed. And we so
much thank you for your leadership and your support.
Chairwoman Waters. You are welcome.
Ms. Patterson. UNITY is a nonprofit organization and HUD-
designated lead agency for an award-winning collaborative of 60
nonprofit and governmental agencies providing housing and
services for the homeless. Our mission is to coordinate
community partnerships to prevent, reduce, and end homelessness
in New Orleans and the neighboring Jefferson Parish. In
addition to raising and distributing funds to support our
member organizations' work, UNITY conducts homeless outreach on
the streets and, very importantly, in abandoned buildings and
rehabs supportive housing apartment buildings in partnership
with the New York based organization Common Ground Institute,
which helps the public locate affordable housing and advocates
for public policy to prevent and reduce homelessness.
While thousands of homes in the New Orleans area have been
repaired since the levees broke, often with the help of caring
volunteers from across the Nation, the extent of the
devastation here remains simply overwhelming. There is still so
much more to be done to rebuild our community.
Four years later, the effects of the levee failures are
most keenly felt by New Orleanians who are its most vulnerable
residents. For many New Orleanians with limited means,
especially the elderly, those with physical or mental
disabilities or those who are struggling to raise a family on
the minimum wage, the struggle for a decent place to live
continues.
Although New Orleans currently stands at only 74 percent of
its pre-Katrina population, homelessness has nearly doubled
since Katrina, from 6,300 homeless persons on any given day
before the hurricane, to a current estimate of 11,500 people
meeting the HUD definition of homelessness. That is, people who
are living and trying to live a human life in abandoned
buildings, people living in cars and on the street, those
living in homeless facilities who are stuck there and cannot
get out, and those who are being evicted or discharged from
institutions who have nowhere else to go. Six thousand people
are currently estimated to be living in New Orlean's more than
65,000 abandoned buildings, while about 5,500 others are living
in other deplorable homeless situations. During the course of
2008, the UNITY network of organizations provided services and/
or housing to 18,875 unduplicated homeless people, including
4,667 homeless children.
Last year, UNITY and its member organizations and
government partners successfully rehoused in the course of one
year 457 people into permanent housing. Those people had
formerly been living in large, squalid homeless camps in the
middle of downtown New Orleans. We are looking at people in
abandoned buildings. These people are the sickest of the sick
and the work that is being done by the nine measly workers of
the outreach team, these very, very committed and fearless
people, is both dangerous and difficult going into these 65,888
abandoned properties. This work that is being done in these
abandoned buildings is unprecedented anywhere in America.
Abandoned buildings dwellers are living in the midst of
crumbling ceilings and walls, mold all over the place, living
with a bucket beside them where they have to use the bathroom.
There is no electricity, no sewage, no running water in these
places, and this is how people are being forced to live in the
richest country in the world.
We are so grateful to Congress for granting last year the
request of UNITY, the Louisiana Supportive Housing Coalition
and the Louisiana Recovery Authority for the 3,000 Hurricane
Recovery permanent supportive housing vouchers which were meant
for people with disabilities in hurricane devastated areas of
Louisiana. And we are especially grateful to you, Congresswoman
Waters, for the important role that you played in that effort,
as well as to Senator Mary Landrieu, the House leadership, the
Louisiana delegation, and the Mayor and City Council of New
Orleans.
Of the 3,000 PSH vouchers, 752 are being targeted to the
New Orleans homeless. What we need is:
$5 million to implement a robust City-wide campaign to
search for and rescue the thousands of vulnerable people living
in the City's 65,000 abandoned buildings;
$35 million for 700 additional shelter plus care vouchers
designated for the New Orleans disabled and elderly homeless,
especially those living in those abandoned buildings; and
$100 million to create housing stock for the poorest and
most vulnerable which is needed to fill the anticipated gaps in
financing, which is the goal of the New Orleans/Jefferson--
Chairwoman Waters. Ms. Patterson, I am going to have to
bring you to a close and for one very, very good reason. Mr.
Cleaver has to catch a plane and so we are going to yield to
him the time to ask some questions before he leaves.
Thank you very much.
Ms. Patterson. Thank you.
[The prepared statement of Ms. Patterson can be found on
page 99 of the appendix.]
Mr. Cleaver. Thank you, Madam Chairwoman. I apologize that
I need to be in Kansas City by 7:00 tonight. I have just two
questions.
Ms. Wiggins, I am not sure, but were you suggesting that a
receivership is where you would suggest the PHA be placed?
Ms. Wiggins. We are asking that HUD is removed and an
executive monitor is put in place. And the reason for that is
because if we have an issue, it is HUD where we get our
redress. There is no place for us to get it because HUD is
actually managing the housing authority at this point. So we
are asking that they are removed and an executive monitor is
put in place, so when there are issues that the residents are
having, that we can go to HUD to get it. That is what we are
asking for.
Mr. Cleaver. I mean, Federal legislation of course places
housing authorities under HUD, that is Federal legislation.
Ms. Wiggins. They can appoint an executive monitor instead
of a HUD employee.
Mr. Cleaver. No, sometimes courts will appoint a receiver,
which I do not think you want.
Ms. Wiggins. No.
Mr. Cleaver. But I do not think you can remove HUD.
Ms. Sinha. The legislation says that if HUD has been a
receiver of a public housing authority for more than 3 years,
they shall then be removed. Meaning that if they have done it
for more than 3 years and something is going on that has not
been improved for more than 2 years. So there is a provision of
law that says that there is a time limit when HUD is supposed
to be receivership and when they are supposed to move it on. So
the law actually says that HUD should move on after a certain
point. And my understanding is that HUD has been a receiver of
HANO since 2002.
Mr. Cleaver. So you are saying that you want the public
housing authority, which means the board, a board, to now
assume the leadership as opposed to the Federal Department of
Housing and Urban Development.
Ms. Sinha. Yes.
Mr. Perry. One of the things that has frustrated so many
people in this City is that administrators from outside of New
Orleans have been making decisions about housing for New
Orleanians. And we just think that is simply unfair.
One of the things that happened in the course of the
demolition process was that there was a memorandum which the
Mayor submitted which said that in order to demolish you have
to agree to allow there to be at least a three-person board and
that three-person board would have a HUD representative, it
would have a public housing representative and a representative
of the Mayor. And the Administration has not been willing to do
that so far.
Mr. Cleaver. Excuse me. I hate to interrupt you, but most
housing authorities are appointed by the mayor and there is a
makeup of course with--there is supposed to be a residential
member and then probably the others are appointed maybe through
some formula, it depends on the City. So I am trying to get a
picture, you are saying the 2 years are over, Ms. Tuggle, and
so you believe that now is the time for the housing authority--
meaning the legal unit that supervises the housing authority--
be appointed and assume that role or are you saying that we
need to have a court-appointed receiver?
Ms. Wiggins. No, a citizen board.
Ms. Tuggle. The residents that I speak with would prefer to
have local control, as their number one choice.
Mr. Cleaver. We use the term public housing authority, PHA,
but that is not accurate, the authority is the board. And so
you are saying that is what you want?
Ms. Wiggins. We want a citizen board put back in place.
That is what we are asking for.
Mr. Cleaver. Is there unanimity, Ms. Sinha?
Ms. Sinha. Anita.
Mr. Cleaver. Everybody is in favor of that?
Ms. Sinha. Yes.
Mr. Cleaver. I am not mad about it, I mean I appointed the
board when I was mayor and the residents generally prefer that
because they could touch me and they can touch the housing
authority as opposed to Federal--thank you and I appreciate
that and again, I apologize for having to leave.
Chairwoman Waters. Thank you so very much for spending time
with us, Mr. Cleaver, please get your plane, get back to the
district, I know that your constituents are waiting on you.
Let me just say to this panel that I am familiar with all
of you because of your advocacy. You have been on the front
lines in all of the ways that you have continued to describe
here today. I have worked so closely with The Advancement
Project. We have done everything from, you know, tour and visit
the ``Big Four'' units where women were busy scrubbing up mold,
to march in Washington, D.C. And the testimony that has been
provided by The Advancement Project has helped to educate me
about what was taking place.
Mr. Perry, I thank you for your work and this business of
Section 8 discrimination is going to have to be dealt with in
some shape or form. We have fair housing laws but those laws do
not reach into the Section 8 problem that you are describing.
Not only are you vividly describing for us discrimination based
on the fact that people just do not want to take Section 8 and
they have all these myths about who Section 8 people are. You
just told us that there was some outright racial discrimination
that was described very vividly to you, and we really have to
see what we can do to make the civil rights laws extend into
this Section 8 problem.
Ms. Tuggle, Ms. Wiggins, Ms. Patterson, all of the talk
about Section 8 that you have shared with us today helps me to
understand that it is time for a revitalization of the policies
that oversee and implement Section 8. This business about the
deposits that are required of people who certainly cannot
afford it is such a deterrent and such an obstacle to being
able to just get into a place. And I have also been made aware
before I came here today of another city where it appears that
some landlords have been very, very good at keeping people's
deposits. As I understand it, not only do they come up with
pictures to show damage, but sometimes there is longstanding
damage that there has been an attempt to get the landlords to
correct that have not been corrected, and then we do not have
anybody advocating that the tenants get their deposit back,
based on the fact that damage has been there and not been taken
care of by the landlord. So I am focused on this and I am
certainly going to deal with this.
The lease problem had been brought to our attention when I
went over to Dallas, I believe it was, and you are absolutely
correct and I like the recommendation about what to do about
this. Our tenants from public housing were confronted with
having to sign leases that they could not get out of, and
should not be put in that position of being in a lease that you
cannot get out of, for a lot of reasons. And it seems to me
that the housing authority or HUD or somebody needs to talk
about what is a reasonable lease for public housing tenants or
other tenants so they are not left with a big legal problem
confronting them that they have to negotiate all by themselves
on these leases.
So I am going to take a look at the revitalization of all
of Section 8 dealing with these problems, including the
problems of the cost of rising utility bills that people are
confronted with.
So what you have done today is to help me and the staff
focus on what we need to do further in dealing with Section 8
and public housing and all of the issues that you bring before
us.
The homeless problem in America indeed, Ms. Patterson, is
shameful, all over America, including Los Angeles. What has
happened here in New Orleans is unconscionable and you are
absolutely right, the consistent figures that we get about the
doubling of the homelessness, and it has been described about
people living under bridges and in cars, but you painted a
picture today about these abandoned buildings and the
conditions under which people are living, which must be dealt
with.
The question that I asked of the last panel about whether
or not the availability of this new Section 8 would be made
available also to the homeless was not clearly answered for me,
but we will pursue that, because as I said, and I do not know
if he understood or not, he talked about publicizing it and
putting it in the local newspapers. When you are homeless and
you have no money, you are not going to spend your money on a
newspaper to see whether or not the housing authority has some
new policies or practices. So I am going to pursue whether or
not the mobile unit that was somewhat described will be moving
around into those areas, and all of the other problems
associated with Section 8.
Thank you so much for being here today. Do not leave. We
have with us, as you know, the Representative for this area,
Mr. Cao, who would like to raise some questions with you I am
sure. In doing his job of representing, he is confronted with
these problems every day. While we are in Washington, you are
coming home to them and you must have a lot of thoughts about
them. So I yield time to Mr. Cao.
Mr. Cao. Thank you, Madam Chairwoman.
This is a question to the whole panel. As you know, there
is not just one type of person or situation that creates
homelessness. If you could advise the City and some of the
developers and officials here about the best way to address the
needs of this population, what are some of the suggestions you
would offer. And I would like to begin with Ms. Sinha.
Ms. Sinha. Let me repeat the question so I understand it.
What--
Mr. Cao. What would you advise the City leaders, the
developers and officials with respect to how can we cope with
the situation of homelessness when we know that there is not
just one type of person or situation that would create this
situation?
Ms. Sinha. I think the theme that comes to mind--and this
is very hard when you have rules and regulations governing this
world--but is flexibility. We are in a place, both in terms of
our current economic crisis but also the fact that we are
dealing with the problem of people who have been displaced
moving from home to home, city to city, for the past 4 years.
And to then have them have this mound of requirements in order
to get their foot into the door and a roof over their head is
completely--it is inhumane.
If you have credit checks, for example, you are required to
have a credit card.
Mr. Cao. If you would keep your answer please--
Ms. Sinha. Yes, okay. So I would say barriers such as
credit checks, barriers such as criminal background checks, the
homeless population are exposed to a lot of criminalization,
are two huge problems. The employment requirement is also a
huge problem. So flexibility in those kinds of requirements are
needed in this situation.
Mr. Cao. Mr. Perry?
Mr. Perry. Thank you. I would offer a few things. The first
is that oftentimes right now, people criminalize renters. It is
this idea that it is so much better to be a homeowner. And of
course it is great to have homeowners and we need them, but not
all people will be homeowners. So you have to be open to the
idea of folks being renters.
The second is that a lot of times when people do create
programs for renters, they do not focus on people who are
extremely low income. And so you have to target funding for
folks who are extremely low income.
The third is the issue that has been raised today and that
is that you have to realize that a lot of times people who are
homeless are not going to be able to go through the typical
application process. So you have to seek people out who are
homeless and make sure that they can navigate, and you have to
streamline frankly the application process.
And then the last thing, the support for nongovernment
entities that actually get out in the community and do a lot of
the work. So a group like UNITY, for instance, if fully funded,
can put a huge dent in the homeless problem here in the City of
New Orleans, but oftentimes nongovernmental organizations are
struggling just to stay alive and so it is very difficult to
then at the same time work in the homeless problem in the City.
Mr. Cao. Ms. Tuggle?
Ms. Tuggle. Thank you. I would make a couple of
recommendations. One would be even with the permanent
supportive housing vouchers that have come down, some of those
are already--were already in the works and some of that housing
came on line without the vouchers and now there is a swap-out
going on. And we have already encountered so many homeless
clients and other disabled clients who have been denied
admission to the PSH units that are subsidized with the
vouchers. And it is to the point now where we are getting ready
to write a fellowship proposal to find an attorney to just
focus on some of the admission issues with that population and
some other advocacy issues.
We have had developers tell us that they will not consider
any reasonable accommodation if someone happens to have a
record of an arrest, even if it is somewhat of a minor arrest.
We have had some developers tell us one bad unit will ruin the
entire property.
So one thing that would be important is for the developers,
landlords, to get more training about fair housing so there
could be more vigorous enforcement of a lot of the issues that
arise.
Additionally, we would suggest that developers be flexible
when working with residents on security deposits. You know,
even developers that only charge $500--I say only because we
are used to now, unfortunately, seeing $1,300 and $1,400
deposits--that you let folks pay that out over time. It is a
huge barrier.
And one last thing that I would mention that often keeps
folks out of housing, there is this idea--and I am not sure
exactly where it comes from--that the utility bill can only be
in the head of household's name. And while that is desirable,
many folks after Katrina had sky high--I am sure you have heard
about the sky high energy bills that ran forever and they were
never shut off. And that has been a huge problem with being
able to have people get back into housing.
Mr. Cao. Ms. Wiggins, Ms. Patterson, if you could keep your
answers brief, I would appreciate it.
Ms. Wiggins. Mine is going to be really brief.
I think that there should be--I would recommend a waiver to
some of the requirements that people have to meet when they
come into public housing or subsidized housing.
I would also recommend that there is a waiver for utilities
for a reasonable period of time, because a lot of times they
are coming from the street and they are homeless and they do
not have income. Those who do have incomes, their family
members are holding it, so there should be some provisions put
in place to allow for a waiver for a period of time so they can
adjust to having that responsibility.
And also, I think there needs to be a support resource
center put in place where these families can go to to get
clothing, furniture, and the necessary things they need to
survive in those units.
Mr. Cao. Ms. Patterson?
Ms. Patterson. Thank you for proposing this question.
Actually, it is contained in the recommendations of UNITY and I
will be very brief with the three major recommendations.
First of all, $5 million is needed to implement a robust
outreach program. We have nine workers, there is no way in the
world that of the two workers of those nine, who are presently
going into abandoned buildings and finding the sickest of the
sick, that this work can continue to be effectively done. So we
need more money to beef-up the outreach team.
We need $35 million to provide for 700 additional shelter
plus care vouchers which is for the sick, the disabled, and the
elderly homeless.
And then to create housing stock for the poorest and most
vulnerable persons, another $100 million is needed.
Mr. Cao. Thank you, Madam Chairwoman. I yield back the
balance of my time.
Chairwoman Waters. Well, let me thank all of you for your
patience, for the time that you have spent here today, for the
testimony you have afforded us and the concerns that you have
caused us to focus on.
And let me just wrap this up by saying we have some of the
developers who are going to come next. Ms. Sinha, you have been
focused on the policies that are developed by some of the
developers, or the developers. I have been talking with my
staff about why does government allow developers to make public
policy to begin with. But in addition to that, as I understand
it, this is not a move-to-work situation, which means that they
do not get to develop those kind of policies anywhere that
relates to the criteria. So I will be taking a very, very, very
close look at that.
Thank you all very much.
I would now like to invite our third panel to come forward:
Mr. Jim Grauley, president and chief operating officer,
Columbia Residential; Ms. Stephanie Mingo, former resident, St.
Bernard Public Housing Development; Ms. Michelle Whetten, vice
president and Gulf Coast director, Enterprise Community
Partners; Ms. Valerie Johnson, former resident, Lafitte Public
Housing Development; Mr. Keith B. Key, chief executive officer
and president, KBK Enterprises; Ms. Donna Johnigan, vice
president, B.W. Cooper Resident Council; Mr. Yusef Freeman,
project manager, McCormack Baron Salazar; and Ms. Jocquelyn
Marshall, president, C.J. Peete Resident Council.
Thank you all for your patience. Thank you for coming here
today to share your testimony with us. And we are going to
start with Mr. Jim Grauley, president and chief operating
officer, Columbia Residential.
Am I pronouncing your name correctly?
Mr. Grauley. It is ``Grauley.''
Chairwoman Waters. Thank you. Will you begin the testimony
for us?
We have a pretty large panel, so we are going to hold you
to your time limits so that we will have an opportunity to
raise some questions that need to be dealt with. Thank you.
STATEMENT OF JIM GRAULEY, PRESIDENT AND CHIEF OPERATING
OFFICER, COLUMBIA RESIDENTIAL
Mr. Grauley. Good afternoon, Madam Chairwoman, Congressman
Cao. My name is Jim Grauley, and I am the president and chief
operating officer of Columbia Residential. I would like to
thank you and the members of the Subcommittee on Housing and
Community Opportunity for affording me the opportunity to
address the subcommittee regarding the status of the ``Big
Four.'' It is my honor to speak to you today representing our
development team.
Hurricane Katrina and the broken levees that followed
devastated the City and the region. Included in the destruction
was the St. Bernard housing project, which was deluged under
several feet of water. These homes and the entire surrounding
neighborhood were destroyed and the citizens were scattered
across the Nation. This was an immense human tragedy as well as
an unprecedented destruction within an American City. Madam
Chairwoman, in this context, we began the daunting task of
rebuilding the St. Bernard community and it is well underway
for the affected families and the broader community.
My company, Columbia Residential, was invited to New
Orleans as a development partner for the redevelopment of St.
Bernard. Building on the vision of HANO, the City and our
partner, the Bayou District Foundation, we have launched the
redevelopment of the surrounding area. Columbia Residential is
a leader in the revitalization of housing--of distressed
housing neighborhoods in several cities across the country. It
is our experience and success in these other communities that
made Columbia Residential the right partner to work for the
Bayou District Foundation and the Housing Authority of New
Orleans.
Columbia builds and manages healthy mixed-income
communities comprising over 4,500 units of housing, which are
known for setting the standard of design quality and responsive
management in their communities. Fully half of the families in
these communities are public housing and former public housing
families, either in the redeveloped sites or within off-site
replacement housing. Over 1,000 of these units are apartments
for low-income seniors in public housing assisted units. We
serve also hundreds of families with special needs,
disabilities, or who are transitioning from homelessness
working with partners providing social services.
I am pleased today to report that thanks to the incredible
efforts of our partners at HANO, HUD, the State of Louisiana,
the City, financial partners, and the resident partners, we
were able to close phase I of the development late last year.
As of today, construction is 30 percent complete on phase I of
Columbia Park at the Bayou District, which includes the first
466 new homes.
Ten new city blocks with new infrastructure are now in
place and are filling with new homes. A community center and
first apartment and townhome units will be available later this
year. Phase I will be completed by late 2010 with resident
move-ins ongoing and continuing into 2011.
I would like to pause, given the discussion about Section
3. We take very seriously our Section 3 compliance and
reporting and outreach efforts. We report that regularly to
HANO. But it was not characterized correctly in the prior
testimony.
During demolition at the St. Bernard site, we had 17
Section 3 workers, 8 of whom were residents. As of today, on
the new construction, we have 50 Section 3 workers who have
been hired by our contractors and suppliers and by the general
contractor, and 12 of those are former residents. We take this
seriously and we are at an early point and we will continue
those efforts. Those numbers represent more than 70 percent of
all the new jobs created at the site.
Columbia Parc is a mixed-income community with multiple
phases of development, 157 units in phase I and at least one-
third of the units in subsequent phases, are set aside as
public housing units specifically for returning families. We
are pleased at the early response at this stage.
Let me skip ahead just for time. We are principally a real
estate developer and our communities serve people and families.
We have made a sincere effort to firmly understand the unique
circumstances in New Orleans and be sensitive to the pain and
incredible challenges faced by families affected by the
upheaval over the past couple of years.
With the assistance of former St. Bernard residents, HANO,
and a variety of outreach mechanisms, we have identified more
than 900 affected St. Bernard families who have traveled to
other communities around New Orleans and across the country.
After extensive outreach and a widely advertised application
period, thus far, more than 400 families have expressed an
interest in returning to the site. As of today, 276 former St.
Bernard households have made application and been qualified by
HANO for the initial site-based waiting list for the
development. The opportunity to return will continue to be open
to all former residents and this outreach on our part will
continue.
Kingsley House, a leading provider of social services to
families in southeast Louisiana, is our partner who provides an
array of services to returning former residents. They are
working with families on an individual basis to prepare and
succeed in returning to the community.
Madam Chairwoman, I believe it is important that we say to
you that throughout the life of this project and our
involvement, priority for occupancy will be given to former
residents of the St. Bernard community, particularly those who
are elderly or disabled.
Madam Chairwoman, we are well on our way through the first
phase of building a healthy community that will transform an
important area of New Orleans. We continue to learn daily as
we, HANO, and Kingsley House work with resident families. We
learn more ways that we can assist and provide services that
will help make a return possible for as many families as
possible.
Chairwoman Waters. Thank you very much.
Ms. Mingo.
STATEMENT OF STEPHANIE MINGO, FORMER RESIDENT, ST. BERNARD
PUBLIC HOUSING DEVELOPMENT
Ms. Mingo. My name is Stephanie Mingo. I want to thank you
for allowing me to speak today. My heart kind of hurts me right
now.
I just want to talk about other residents. Every resident
of public housing, just like every New Orleanian, has a right
to return. Planning at the ``Big Four'' should be reflected on
this. Currently, they do not. Public housing residents are
being denied the right by HANO and the development.
Columbia plans to bring 150 homes for public housing
residents at the former St. Bernard, excluding at least 90
percent of the former residents. We should be rebuilding 1,500
units of public housing at St. Bernard, not 150. If they do
one-third of public housing, one-half of Section 8, and one-
third of tax credit, then it would take care of the low income.
But why is two-thirds of St. Bernard being developed on purpose
for the people who did not live there before Katrina?
Finally, the rules and regulations or eligibility
requirements at the redevelopment of the ``Big Four'' are being
designed to exclude low-income New Orleanians, especially
public housing residents.
I have been working on Section 3 a whole lot, I have
something written down, but I want to clarify something. I have
to write letters to the development. HANO and the developments
are not complying with Section 3 requirements. They claim to
be, but we have yet to see hard data provided for what they
said.
Section 3 was created so that impacted communities will
benefit from redevelopment. In other words, as a resident of
St. Bernard, I do not see my constituency benefitting from the
jobs and the contracts produced so far. I have attempted to
contact HANO's Chairwoman Diane Johnson and HUD staff members,
including Stacy Hanson, the Director of HUD's Economic
Opportunity Division, and Marvelle Robinson, the field office
director for HUD in New Orleans about my concern. I have yet to
hear from any of them. I have copies of my June 14th letter
sent to them, and if this committee would like it, I will
provide it for you.
I feel this committee should force HANO to release all data
of hiring and contracts to be published so that we can get to
the bottom of this quickly.
Iberville, stimulus money is being used to fix up some part
of Iberville. As much as we appreciate it, we need much more
than a fresh coat of paint or new lightbulbs. We need to have
all the unoccupied units fixed up and rented out so what
happened to St. Bernard, Lafitte, C.J. Peete, and B.W. Cooper
will not happen in Iberville. This is also a security issue. If
you occupy those developments, you would not have to worry
about crime--neighbors can watch out for each other, is what I
am trying to say, if they were occupied.
Having them board-up apartments increases crime and reduces
the community's ability to keep on one another's space. We need
our utilities permanently upgraded. The needs of Iberville
should never be used as an excuse to demolish or redevelop it
along the lines of the ``Big Four.'' We need a reinvestment in
Iberville as it once was.
As for Lafitte, I believe the remaining 100 apartments
should be reopened and reoccupied by residents immediately.
Across the City and across the Nation, we should implement a
moratorium on the demolition of public housing.
To conclude, we need a one-for-one replacement of public
housing that was demolished after Katrina. This means building
more than 5,000 units of public housing in New Orleans.
Vouchers have failed us. They do not secure quality housing and
they do not provide tenants with a home. Vouchers might be a
part of a housing strategy but only true public housing can
reduce the rent price in our City.
And one more thing I would like to say, I probably have
more names of public housing residents than Mr. Grauley. Me and
a lot of other residents have worked on the ground every single
day. I have a job, I have been working 13 years where I am at.
I mean, do not get me wrong, I want something new and I like
something new, because I deserve something new, but the way
that St. Bernard is coming up, it is no better than what it was
before. We cannot talk to the developer. We are shut out. If we
say something that they do not like--and this is the God's
honest truth--we are shut out. We have at least 10 people--he
was right, because I give him the benefit of the doubt, he
might be right, eight people working on the ground. We had our
own--I forgot the word I am looking for--but we had our own job
fair, we had 150 people come out. We went out on the street to
deliver the applications, then we did a re-check on the
applications. They said we had to go to HANO, I just saw HANO
at a meeting. HANO said we have to go back to Columbia. We did
our own diagram and wanted our own builder, they denied that.
My heart is still hurting. Thank you for listening.
[The prepared statement of Ms. Mingo and other material
referred to can be found on page 91 of the appendix.]
Chairwoman Waters. Thank you, and without objection, your
letter and your list will be submitted for the record and I
will take that and we will review that.
Ms. Whetten.
STATEMENT OF MICHELLE WHETTEN, VICE PRESIDENT AND GULF COAST
DIRECTOR, ENTERPRISE COMMUNITY PARTNERS
Ms. Whetten. Thank you, Chairwoman Waters and Congressman
Cao, for holding this important hearing. My name is Michelle
Whetten and I am vice president and Gulf Coast director for
Enterprise Community Partners.
To date, Enterprise has invested over $100 million in
grants, loans, and equity with 1,450 homes completed and 3,000
in some stage of construction or development in Louisiana and
Mississippi.
Our most ambitious project in this effort has been the
redevelopment and revitalization of the historic Treme/Lafitte
neighborhood on and around the site of the Lafitte public
housing development.
Before creating a plan for Lafitte, Providence and
Enterprise engaged a local community organizing group to help
us locate nearly 600 of the nearly 865 Lafitte households who
had evacuated to cities across the country. With a team of
architects and planners, we held a series of charrettes both in
New Orleans and in Houston, where residents were involved in
the design process and articulated a vision for what the new
community would look like. And our site plan today reflects
very closely that vision of the residents.
The 27-acre parcel of the Lafitte site and the scattered
site properties involved in the redevelopment do allow us to
accomplish two important goals: to honor our commitment for a
one-for-one replacement standard; and to deconcentrate an area
of poverty. And I would like to correct--the information that
was presented from the Times Picayune was inaccurate. In our
first major redevelopment phase, which includes 568 rental
units, only 40 of those are low income tax credit only units. A
full 387 units are project based Section 8 and the balance are
ACC, which means that 528 of our first units will be affordable
to the typical public housing occupant.
With the Housing Authority of New Orleans and our local
partner Providence, we will break ground on the first phase of
the new development next week. This development will meet
Enterprise's nationally recognized green community standards.
And while we look forward to getting construction underway, we
would be the first to acknowledge that it has taken far too
long to get to this point.
Although we were awarded CDBG funds and tax credits in 2006
for this development, demolition was not completed until
October 2008. And that timing coincided with the dramatic
decline in the credit market that I am sure you are all too
familiar with.
While the stimulus act provided several important and
helpful programs to address the problems with the low income
housing tax credit market, Gulf Opportunity Zone loans and
housing tax credits have been determined by Treasury to not be
included in the important tax credit exchange program and the
current deadline of December 2010 for placement of these
credits in service is causing a major point of risk and
disincentive for investors to purchase credits in the GO Zone.
And I think it is important to note that a majority of the
affordable rental housing that was to be redeveloped following
Katrina in Louisiana and Mississippi in particular depended on
these GO Zone tax credits to be constructed. So we believe that
extending that placed in service date and allowing the exchange
program to apply to these credits would allow the majority of
those units to be finished, which currently there is
approximately 6,800 units in Louisiana and Mississippi at risk
of not being developed.
We maintain a database of former residents that is
regularly updated and verified through letters, surveys, and
monthly meetings and we provide residents updates on the
progress of the development and solicit their input on
important issues such as selection of a property management
company and other activities. As construction gets underway, we
will provide clear instructions to residents on the process for
applying to live in the community, the new community.
With $2.5 million in in-kind services provided by Catholic
Charities USA to former Lafitte residents in New Orleans,
Houston, and Baton Rouge, and other philanthropic support, over
450 former Lafitte resident families have been assisted with
finding stable housing and addressing basic needs after being
displaced by Hurricane Katrina.
And Catholic Charities in January of this year reopened the
Sojourner Truth Community Center adjacent to the Lafitte site,
where families and residents can access a variety of programs.
We are grateful for the leadership of Chairwoman Waters and
others in Congress for keeping a spotlight on the ongoing
recovery needs of the Gulf Coast. Four years following the most
devastating disaster in our country's history, the long-term
recovery of the region, particularly for the region's lowest
income and most vulnerable residents, is far from complete.
So we would ask again that Congress take action to extend
the placed in service deadline 2 years and consider the tax
credit exchange program so that these units can get built.
Thank you.
[The prepared statement of Ms. Whetten can be found on page
147 of the appendix.]
Chairwoman Waters. Thank you.
Ms. Johnson.
STATEMENT OF VALERIE S. JOHNSON, FORMER RESIDENT, LAFITTE
PUBLIC HOUSING DEVELOPMENT
Ms. Johnson. Thank you. My name is Valerie Johnson, and I
am a former Lafitte resident. Thank you for taking time out of
your busy schedule to hear from the ``Big Four'' and what
relates to their future.
I had to do a little change on my agenda, where I said the
current status of public housing in New Orleans appears to be
on the fast track. I changed it. Right now I am looking forward
to the building. In the process, I have been afforded the
opportunity to be a part of the planning process from the
beginning as it relates to:
The type of housing we will live in;
Saving of the oak trees;
Monthly meetings since its inception; and
Working in concert with Providence and other social service
entities at Sojourner Truth Community Center addressing the
needs of residents and identifying resources to support these
needs.
We are looking forward to the groundbreaking in the
upcoming week at the Lafitte public housing development.
The Section 8 program offers little or no support as it
relates to assisting residents making conscious decisions in
the application of the Section 8 program. Many residents and
elderly and persons on fixed incomes are struggling to survive,
making decisions on buying their medications, food, and other
staples to sustain them or paying their utilities.
There is little or no affordable housing for former
residents and attaining a job with livable wages is virtually
obsolete. The challenges may seem unreachable, but with the
right support services in place, it could ease the stress of
making dire consequences to survive.
Many residents of public housing are currently spread
throughout this country in strange lands with strange people.
They want to come home, but where is their home that was
promised 4 years ago?
It is time to stop procrastinating and blame shifting and
work in concert with social service agencies to reach goals
that seem out of reach, and receive the residents of public
housing back home in a land that is familiar to them and they
call home.
Chairwoman Waters. Thank you very much, Ms. Johnson.
Mr. Key.
STATEMENT OF KEITH B. KEY, CHIEF EXECUTIVE OFFICER AND
PRESIDENT, KBK ENTERPRISES
Mr. Key. Good afternoon and thank you for allowing me to
come and speak about the B.W. Cooper project. My name is Keith
Key, and I am the president and CEO of KBK Enterprises.
Let me start by saying that it has been an honor for me to
be involved in this project and an honor to work with our
partners at the B.W. Cooper Resident Management Corporation. We
were fortunate that they chose us to be the developer prior to
even the submission of the RFP, which we all agreed to respond
to together as a team. So we were proud to be selected by the
residents before we were selected by HANO. So that is an honor
for me just to be involved and trusted by the residents.
Let me begin at least summarizing my response. The project
is currently in the status where we have completed demolition,
the infrastructure is approximately 40 percent complete, the
drawings are complete, submitted, and approved by the City. We
currently have a $22 million gap. That gap is the distance
between us beginning construction and going vertical and
completing the project moving forward. So we are working very
diligently on filling that gap.
Our current strategy for the gap is we have an application
with the stimulus package with HUD for $10 million; we have a
structure to reduce a portion of our reserve by $4 million; and
we are seeking City, State, and Federal resources for another
$8.2 million. That would close the gap on the project and allow
us to move forward with our vertical construction.
We have looked at a variety of proposals and options to
pursue various support systems to encourage our investor to
stay involved and continue to look at the rate and structure of
our financing. One of the important issues that we would like
for Congress to help with is the extension of the GO Zone
credits. They currently have a closed and placed in service
date by end of 2010. We would like to look at an extension to
that.
We would also like for Congress to help with the TCAP
exchange program, in making that available to GO Zone credits
as well. That would greatly enhance the capitalization of our
project, which is currently at about 59 cents in credits versus
the 80 cent plus that you would be able to have from the
exchange program.
We are also looking to work with the Louisiana Office of
Community Development. We have supplied an application to
provide project based vouchers at our site in contrast with the
LIHTC program, the low income housing tax credits, so that
would allow us to actually reduce our reserve and allow us to
provide residents with access to Section 8 program vouchers,
support their rent for lower income.
The other key piece of our proposal I think that should be
mentioned, in terms of occupancy, the first phase of the
project is 410 units. We are expecting 173 of those units to be
units that will be occupied by public housing residents,
another 106 of those units would be in the phase two, totaling
279 public housing units in phases one and two of the total 660
units planned.
We have also looked at the numbers of that 173 and 106, 20
percent of those units would come from LIHTC units. We did a
survey with the residents and the resident management
corporation of looking at the residents and their income base
and their income base stipulated that there are many of them
who would be eligible for LIHTC rents. And so we estimated
about 20 percent of those residents using LIHTC available units
for their occupancy.
One of the questions was asked about the information of how
we would find residents and work with HUD and HANO to bring
those residents back to the community. It is important to note
that the resident management corporation has been by far not
only a great relationship for us but they have maintained great
relationships with the current residents. We have nearly 300
residents on site today and they have done an incredible job of
seeking and communicating with those residents who have left
New Orleans and left B.W. Cooper. And they have developed a
database that we are currently working to purge and refine so
that we can make sure that those residents who are on their
lists are identified and responded to.
Lastly, the question regarding the occupancy and the rental
terms that the residents would have to endure when leasing the
property, those structures are actually going to be created in
selection process with the resident management corporation and
the residents. So our plan is to sit down with the residents
and build a selection policy that would be amenable to both the
residents, HANO, HUD, and our investors.
Thank you.
Chairwoman Waters. Thank you very much.
Ms. Johnigan.
STATEMENT OF DONNA JOHNIGAN, VICE PRESIDENT, B.W. COOPER
RESIDENT COUNCIL
Ms. Johnigan. To the Honorable Chairperson and
Congresswoman Maxine Waters and other distinguished members of
the subcommittee, and most importantly, to the thousands of
public housing families of New Orleans who were impacted by
Hurricanes Katrina and Rita.
My name is Donna Johnigan, and I want to start my testimony
by thanking you all for allowing me the opportunity to appear
before this distinguished panel to express my personal
observations and experiences since the devastation of 4 years
ago.
I am a life-long resident of New Orleans and have spent 4
decades of my life living in New Orleans public housing and
working to better the living conditions of public housing
residents in New Orleans and nationally.
I have served in numerous public housing resident advocacy
positions over that period and served as one of the founders of
an organization of mothers who have lost children to the
senseless violence that plagues our youth in public housing
communities across this Nation.
Currently, I am the vice president of the board of
directors of the B.W. Cooper Resident Management Corporation.
B.W. Cooper RMC is a residential property management entity
that contracts with the Housing Authority of New Orleans to
manage the development I live in.
We are one of only two such corporations in the City of New
Orleans and the State of Louisiana, and have existed for over
20 years, successfully demonstrating our capability to manage
our lives and our communities.
Unfortunately, my community and other public housing
communities are not what they were once, in part because of
Hurricanes Katrina and Rita, but also because of a housing
authority that seems to be insensitive and out of touch with
the realities of the uniqueness of our plight in New Orleans.
As you know, thousands of public housing units were
destroyed 5 years ago, and thousands of families were displaced
as result.
Since that time, there has been a major effort on the part
of the Federal Government and the Housing Authority of New
Orleans to rebuild our communities, and we welcome that effort.
However, a great majority of families who were displaced will
not benefit from this massive effort.
Our communities are being rebuilt as mixed-income housing,
with only a small number of units targeted to return as public
housing units. And though it is claimed that a majority of
units will be affordable, the term ``affordable,'' while
appropriate in other cities, will not be affordable to or serve
the majority of needy families in this City.
``Affordable'' includes families whose incomes are up to 60
percent of median income for this City, when in reality, the
majority of families who need affordable housing fall well
below that and the national poverty level.
We welcome the opportunity to live in a community that has
diverse income levels, but that should not come at the expense
of harshly impacting the families who need help and once made
up our communities. At least 50 percent of units constructed in
these communities should have been actual public housing.
Also, there is a local and national effort for the Section
8 voucher program to replace conventional public housing as the
primary source for the provision of assisted housing. But in
reality, Section 8 vouchers are not good for very-low-income
families, because of the uncertainty of utility costs as an
added burden, and the requirement that families receiving these
instruments must find and convince a landlord to lease to them
in a competitive market.
Those requirements and others are burdensome to families
who have never had to perform those tasks. And the housing
authority staff is not informing families of all the
consequences of selecting Housing Choice vouchers, which is
inexcusable.
Finally, the opportunities for resident management
corporations to continue to manage in the future has been
seriously eroded because of the move away from traditional
public housing that they and we have experience in managing.
At a time when government is asking us to take more
responsibility for our communities, one of the instruments that
allows us to do that is being systematically phased out. We are
being left to compete with private market management companies.
I have fought all my life to remove the image of the
stereotypical public housing resident that the public holds in
general. And I now find myself having to gear up again to fight
for the rights of public housing residents to reclaim their
communities.
I am up for that fight.
With the help of people like you, Congresswoman Waters, I
am confident that we will again overcome the barriers that have
arisen to prevent us from controlling our communities. And I am
equally confident that we will eventually prevail in providing
really affordable housing to the families who are relying on
the government to help them return to their communities.
Again, Congresswoman Waters, I want to thank you and your
committee for coming to New Orleans to see and hear our stories
firsthand.
Chairwoman Waters. Thank you very much, Ms. Johnigan.
Mr. Freeman.
STATEMENT OF YUSEF FREEMAN, PROJECT MANAGER, MCCORMACK BARON
SALAZAR
Mr. Freeman. Madam Chairwoman, Congressman Cao, thank you
for this opportunity to speak before you today. My name is
Yusef Freeman and I am an employee of McCormack Baron Salazar
and the project manager of the redevelopment of Harmony Oaks,
formerly known as the C.J. Peete and Magnolia public housing
development. In partnership with the New Orleans Neighborhood
Development Collaborative, a local nonprofit organization, and
KAI Design and Build, an MBE architecture firm, we were
selected by the Housing Authority of New Orleans through a
response for qualifications procurement as Central City
Partners with Urban Strategies, to redevelop the former public
housing site, provide community supportive services to the
former residents of the site, improve educational opportunities
in the neighborhood, develop sports and recreation facilities,
and develop quality commercial services for the community.
The mission of McCormack Baron Salazar is to rebuild
neighborhoods in central cities across the United States that
have deteriorated through decades of neglect and disinvestment.
In partnership with communities, we bring vision, experience,
and commitment to the challenge of community revitalization.
When Hurricane Katrina struck, 144 families were still
living at the C.J. Peete site. These families were displaced,
many out-of-State. The buildings remained vacant until they
were demolished in the spring of 2008.
The new Harmony Oaks mixed-income community will include
460 mixed-income rental units. Of those, 193 will be public
housing units, 144 will be low income housing tax credit units,
and 123 of those units will be market rate rental units. Public
housing residents with vouchers will be eligible to use those
vouchers in both the low income housing tax credit units and
the market rate rental units.
Three on-site historic buildings are being rehabilitated,
including one residential building, the administration
building, and the community center. In addition to the
community center, which houses the computer lab, the site will
include a swimming pool, fitness room, community space, an on-
site management building and each cluster of buildings will
have tot lots and secured parking. The community center is
currently run by the head of the C.J. Peete tenant's
organization, Ms. Marshall, who will speak after me.
Harmony Oaks was designed in partnership with the C.J.
Peete Resident Council, HANO, and community stakeholders. A
project steering committee that includes representatives from
the resident council, HANO, State and local government, the
school district, neighborhood faith community, and other
community stakeholders continues to meet on a quarterly basis
to contribute to the development of the site.
The for-lease apartments are all designed with market rate
features. There are no amenity distinctions between public
housing, market rate and tax credit units. Each unit will
feature high quality flooring, window treatments, central
heating and cooling, wood kitchen cabinets, refrigerators,
ceiling fans, microwaves, dishwashers, clothes washers and
dryers, and security systems.
Construction of the 460 rental unit phase began in February
of this year and is approximately 22 percent complete, 57 slabs
have been poured, 27 buildings are framed, 95 percent of the
drainage and sewerage are constructed, and 50 percent of the
water lines are complete.
The cornerstone of the new community will be a Campus of
Learners comprised of a new state-of-the-art elementary school,
recreation center, and health clinic. McCormack Baron Salazar
has committed $20 million of our allocation of new markets tax
credits to the recovery school district for the redevelopment
of the Woodson School that is located across the street from
the Harmony Oaks site.
Fifty homeownership units are being developed by the New
Orleans Neighborhood Development Collaborative in the
communities surrounding the Harmony Oaks site. Eight of these
homes are currently under construction. NONDC is working with
HANO and Urban Strategies to qualify low-income homebuyers to
participate in the homeownership program. Public housing
residents have the first right to these homeownership units.
The development team procured Urban Strategies to
coordinate community and supportive services for households who
lived at the former C.J. Peete development. Urban Strategies is
a not-for-profit corporation that is coordinating all the
support programs that assist former C.J. Peete residents
achieve self-sufficiency, including intensive case management,
job training and placement, quality child care and schools,
access to physical and mental health services, senior programs,
and enrichment activities for children and youth. Urban
Strategies case managers are working closely with the residents
to access needed services, regardless of where they are
currently residing in the country.
CSS activities currently operating out of the C.J. Peete
Community Center include case management, technology programs,
social activities, tutoring, construction job training, health
programs, and community-based programs built on local
partnerships. Urban Strategies case workers are currently
providing community supportive services to 485 former C.J.
Peete residents.
When complete, 193 of the 460 mixed-income units at Harmony
Oaks will be public housing units. Public housing residents
will also be eligible to use vouchers to rent market rate and
tax credit units. All former residents interested in returning
to the site will complete an application to the management
company, McCormack Baron Ragan. To be admitted to a public
housing unit, the applicant must meet all eligibility
requirements for admission to public housing as established by
HUD and HANO. Before an applicant is denied admission for any
reason, they will be able to refute that denial.
HANO adopted the re-occupancy policy under which residents
of the former C.J. Peete public housing development and of
other HANO-owned public housing developments, will have
priority rights to admission to the public housing units in
Harmony Oaks, subject to the previously mentioned eligibility
requirements.
In closing, in partnership with the C.J. Peete Resident
Council, HANO, HUD, the Louisiana Housing Finance Agency, the
Louisiana Office of Community Development, the City of New
Orleans, Council member Stacy Head's office, the Ford
Foundation, the Casey Foundation, LISC, Living Cities, the
Greater New Orleans Foundation, and others, the development and
community supportive services team have been successful in
commencing construction and connecting residents to needed
services.
The last thing is to continue this success, further
investment is needed to provide additional community supportive
services. While Katrina was 4 years ago, the traumatic impact
on residents is still at the forefront. More funds are needed
to provide mental health services to families impacted by the
storm. In addition, more resources are needed to sustain case
management services--
[The prepared statement of Mr. Freeman can be found on page
74 of the appendix.]
Chairwoman Waters. Thank you, Mr. Freeman.
Ms. Marshall.
STATEMENT OF JOCQUELYN MARSHALL, PRESIDENT, C.J. PEETE RESIDENT
COUNCIL
Ms. Marshall. Good afternoon, Madam Chairwoman, invited
guests. It is indeed an honor to testify before you all today
on the status of the ``Big Four'' as well as the state of
housing throughout the City of New Orleans.
The status of public housing, including the ``Big Four,''
is bleak. The supply does not meet the demand.
The families who were typically middle class before Katrina
have fallen into a lower tax bracket because of their inability
to find livable wage jobs and meet the high cost of rent in the
current housing market. With the state of the economy and the
housing market, it leaves all New Orleans residents with little
hope that things will improve.
As it relates to the redevelopment of C.J. Peete, initially
there was apprehension. That apprehension was based upon what
the demolition of public housing would mean to the state of
affordable housing throughout the City of New Orleans. However,
as it specifically related to C.J. Peete, we knew that
demolition was inevitable but we did not agree with how HUD
proceeded with their plan.
To my surprise, redevelopment at C.J. Peete is proceeding
very well. We have a very unique working relationship with the
redevelopment team which consists of Central City Partners,
C.J. Peete Resident Council, McCormack Baron Salazar, KAI
Design and Build, NONDC and Urban Strategies, Inc., our
community and social services contract administrator.
What is unique about this project is that Urban Strategies
works side-by-side with the resident council to provide
technical assistance and support for the residents and resident
leaders. Also, we have case managers onsite to address the
needs of the many families that we serve.
As it relates to the Section 8 program, it has been my
experience that the Section 8 program basically creates
disparity between low- to moderate-income families and market
rate tenants. You are either too rich for public housing or too
poor for market rate units. There has to be a balance across-
the-board.
What housing challenges are facing former C.J. Peete
residents and how should those challenges be addressed?
I would like to break those challenges down into three
categories, if I may. There will be current challenges that
they will face. There will be challenges that they face trying
to get back home. And there will also be challenges when they
come back and reside at the new redeveloped sites.
Their current challenges are the social needs--employment,
literacy, transportation, affordable, quality early childhood
education, locating services in the cities where they currently
reside, lack of community schools, and limited healthcare.
My recommendations are:
Each redeveloped site in conjunction with a community
center, needs a community social service component to address
the needs of residents. Consequently, if we do not address the
social element of everyone in the household and provide
services at every site, we will be back where we were 10 years
ago. Redevelopment should not be focused on bricks and mortar;
the social elements must be addressed as well.
Since the lack of employment opportunities is a real
challenge for residents, the enforcement and oversight of the
Section 3 hiring process is critical in assisting qualified
low- to moderate-income individuals in gaining employment. We
recognize the challenges each site faces in addressing the
pressing needs of many families we serve. We have formed a
collaboration with the other sites, beginning with a
construction training program coordinated by the C.J. Peete
team and community partners to proactively address the Section
3 hiring process at each site. I recommend that all sites
address redevelopment from the holistic approach by doing our
part in addressing all of the issues to the greatest extent
possible.
The challenges that they will face coming home: Getting out
of their current leases with landlords, relocation expenses,
paying deposits.
Currently, HANO will approve a family or individual to get
out of a lease to return to public housing, but that does not
typically--they do not typically approve it if you are a
voucher recipient. I recommend that HUD, HANO or the developer
pay an early termination fee to the landlord.
Relocation expenses are only offered to residents returning
to public housing sites. Therefore, I recommend that the fees
be offered to anyone deemed having a right to return to the
site, especially if in fact they are returning to that site.
The rationale is each resident was involuntarily moved out, so
each should be assisted in moving back in.
The challenges that they will face when residing back in
the sites: There will be no group to advocate on residents'
behalf. There are outdated HUD regulations. Lack of male
involvement in the family.
I would recommend that each site needs a resident council
or an advisory group made up of a diversified group of
residents who reside in the community, to advocate on their
behalf. There should be a set criteria that is developed with
the current leadership, Legal Aid, HANO and the developer
approved by HUD. There should be consistency across-the-board.
Thank you.
[The prepared statement of Ms. Marshall can be found on
page 86 of the appendix.]
Chairwoman Waters. Thank you very, very much.
Let me thank again all of our panelists who have come today
to share such important information with us. I am particularly
proud of the public housing advocates, residents and former
residents who have worked so hard, informed themselves so well
and who are advocates on behalf of people who do not have fancy
lobbyists working for them at the City, County, or Federal
level.
I am extremely impressed with your recommendations and will
take them seriously and do everything that I can to try and
right some wrongs and to prevent some wrongs from happening in
the future as we look at how we rehabilitate and how we
restructure Section 8.
Let me start with Mr. Grauley, however. I want to ask each
of the developers just quickly, you do not have to go into
detail. As you penciled out your proposals and as they were
accepted for development, do you now have all of the financing
that you need, except for the tax credit part that I understand
is not available because of the lack of investment because of
the meltdown in our economy? But other than that, do you have
all of your financing lined up?
Mr. Grauley. We have all the financing for phase I, 466
units. We have a commitment from the housing authority that is
in place for the infrastructure for the remainder of the site.
After that, there is not funding in place that we are aware of
from HANO, but they have committed to see the whole thing
through. We have made an application to the State of Louisiana
and to HANO for phase two, it is a very strong application and
our intention and what we believe will occur is we will roll
immediately into phase two late in 2010 with our current
application, that will allow us to continue build out.
There is a lot of talk about how there are only so many
units, but the focus and the numbers in the Times Picayune are
focused on phase I. Our phase I is an extraordinary size, 466
units, as the other developers--
Chairwoman Waters. I am just interested in the financing
right now. As you developed your proposal, had you anticipated
the needed funding from HANO or from any other sources other
than your traditional financing sources--well, that may be even
traditional, but were you expecting any more money from HANO or
HUD?
Mr. Grauley. HANO was clear that they were committed to
seeing the development through all phases.
Chairwoman Waters. I am sorry, start that over again, I was
a little startled by God's work.
Mr. Grauley. HANO was clear that they were committed to
seeing the development through all phases and they have stood
by us on that. There was a significant traunch of funding for
all the ``Big Four'' from the State of Louisiana and the CDBG
program. Those funds have largely been used with the first
phases of the ``Big Four'' and so having additional funds to
fill that gap are important. Further, I do not think any of us
anticipated, as my colleagues have referenced, seeing the tax
credit market occurring as we have. We certainly--I would echo
the request around the GO Zone credits. That enhanced our
equity raise very substantially, we were able to close it in
time. And having that come back in place would be very
important to allow future phases to get the kind of pricing
that would bring a lot more private funds in.
Chairwoman Waters. So what you are basically telling me is,
of course, you anticipated the cost and you organized your
redevelopment based on real numbers that you submitted. But
there are still some questions about some portions of that
funding coming from other sources, such as the State, HANO,
etc.
Mr. Grauley. Yes. In our case, we do not have questions
about phase two, our phase two does not use the State CDBG
resources, but in subsequent phases after that, to get to the
full build out of the site, which is very important, so we can
replace all the units, there is a question about that.
Chairwoman Waters. Okay. All right, what about Lafitte and
Enterprise, except for the investment tax credits.
Ms. Whetten. Right.
Chairwoman Waters. Do you have all of your financing lined
up?
Ms. Whetten. For the first 568 rental units and 244 for
sale units, we have the CDBG funds from the State of Louisiana
through the piggyback program, and tax credits committed and we
have HANO subsidy committed to complete those units. If there
is one sort of gap in where we believe we need additional
funds, it is for additional homeownership subsidy to make the
for sale homes that we build more affordable to the residents
wishing to buy a home.
Now we have a committed investor for the first 137 rental
units and we have, as I mentioned, the funds committed for the
for-sale units, which is 47 in the first phase. We believe we
have--we do have strong investor interest and believe we can
sell the credits to complete the 568 units but for the placed
in service extension.
Chairwoman Waters. So you in no way, either Mr. Grauley or
you, are looking to HUD for any more money?
Ms. Whetten. As I said, we believe additional funds are
necessary to make for sale homes affordable to the residents in
Treme--
Chairwoman Waters. Okay, and what about you, Mr. Grauley?
Mr. Grauley. Not on phase I and phase two, Madam
Chairwoman, but in additional phases, certainly we will be and
HANO has committed to that.
Chairwoman Waters. All right. Mr. Key?
Mr. Key. Congresswoman, I am looking to HUD for help.
Chairwoman Waters. You need some money.
Mr. Key. Yes, we need $22 million.
Chairwoman Waters. Okay. Mr. Freeman?
Mr. Freeman. We have all of our funds for the original
phase with the soft second program for homeownership. We are
looking for additional funds for our homeownership phase and
for additional funds for a commercial phase.
Chairwoman Waters. Okay, what I have heard here today,
developers, from residents and from our advocates is there
should be more low-income units or units that people could
qualify for, who only have--meet the criteria for public
housing.
So you have already designed your projects, you have
penciled them out, you know what the costs are, but if you need
more money to complete it and if you were asked in exchange for
that money to modify your plans so that you could increase the
number of low-income units, what would you do?
Mr. Grauley. I believe we would like to look at that and
consider that. We do believe in the mixed-income model and that
was--
Chairwoman Waters. No, I know all of that. I see your
mixed-income model, I see what you have for public housing in
essence, I see what you have for the tax credit units, I see
what you have for homeownership. That is not my question. My
question is that would you, could you modify your plans to
accommodate more low-income housing opportunities, if you had
to.
Mr. Grauley. We could--yes, we certainly would consider it.
Chairwoman Waters. What about Enterprise, could you do
that?
Ms. Whetten. In our first major development phase, the 568
rental units, all but 40 are permanently affordable to
households that could previously afford public housing rents.
Chairwoman Waters. For Lafitte, I am looking at your
planned units are 176 from the Times Picayune very graphic
description of the total number of units that they had at
Lafitte, the number that was unoccupied, the number that is
planned in the blue section for the low income or the public
housing criteria eligible, etc. What I want to know is if you
are looking at the same thing I am looking at or if you
understand the same thing I understand, would you increase that
176?
Ms. Whetten. I am not familiar with the numbers you are
looking at and they do not match with anything in my
understanding of what--
Chairwoman Waters. Well, let me just ask it this way, if
you need money from HUD and you were told by HUD the
legislators will not let us do it unless you increase the
numbers, what would you do?
Ms. Whetten. Our commitment is to build 900 affordable,
subsidized permanently affordable rental units in the full
development.
Chairwoman Waters. We know that, we know that, you told us
that already, and we know that you have some units on the
footprint and you have some that are in scattered housing.
Ms. Whetten. Right, our first phase--
Chairwoman Waters. We are talking about in the footprint,
that is what I am talking about now. I am asking a question. I
do not have any plans yet, I do not know anything. I am just
wondering, since the residents tell me that they believe, as I
do, that there should be one-for-one replacement, they do not
necessarily believe that it should be a reduced number on the
footprint and the rest of it in scattered housing, that maybe
we should have more on the footprint. If you were asked to do
that, based on the ability to help continue the funding, what
would you do?
Ms. Whetten. Our site plan was carefully designed based on
the wishes of residents to de-densify the site and provide more
single and double occupancy homes and apartments. Our
commitment is one-for-one replacement and deconcentration of
poverty, and we are doing that through scattered sites and on-
site development. Our on-site rental units are--our first phase
is 568 and as I said, all but 40 are permanently affordable. So
additional affordability if we had--
Chairwoman Waters. Okay, you are not prepared to answer my
question at this time.
Let me move on to Mr. Key. What would you do, Mr. Key?
Mr. Key. If we could make it economically affordable, we
would definitely look at it.
Chairwoman Waters. You would consider what I am proposing?
And like I said, I am not proposing it now, I am wondering.
Mr. Key. Sure.
Chairwoman Waters. And I am trying to--because all of you
respect the residents so much and you work with them so closely
and you want their input. And their input to a person is there
should be more onsite low-income units. And so what you are
saying is you would consider that.
Mr. Key. Yes, I would consider it.
Chairwoman Waters. What about you, Mr. Freeman?
Mr. Freeman. All 50 of our homeownership units that we need
additional funds for are public housing replacement units.
Chairwoman Waters. I beg your pardon?
Mr. Freeman. All 50 of our homeownership units that we need
additional funds for are public housing replacement units.
Chairwoman Waters. Okay. I am certainly not talking about
homeownership, and you know that.
Mr. Freeman. Well, the answer to your original question of
do we need additional funds for--
Chairwoman Waters. No, no, no, no. That is not what I asked
you. What I said was if you need additional funds to finish
whatever you have to finish and if the requirement was, in
exchange for the funding, that you have to maybe instead of
having 50 homeownership units, maybe you have 25, and the other
25 are converted now to low-income units. Could you do that?
Mr. Freeman. On our current plan, we could not do that.
Chairwoman Waters. That would be impossible for you to do?
Mr. Freeman. Yes.
Chairwoman Waters. Okay, so you would have to turn down the
money if that was a requirement.
Mr. Freeman. Right.
Chairwoman Waters. Okay. That is all I wanted to know.
Secondly, let me ask about the jobs. And I do not want to
prolong this discussion on this and I want to be as clear as I
can possibly be.
You gave me a number, Mr. Grauley, that you had--of jobs,
that had been realized in what, the demolition stage?
Mr. Grauley. The demolition stage and the new construction
stage.
Chairwoman Waters. Okay, give me that again. On the
demolition stage, how many residents did you hire and are they
still hired, what happened to them? Did they transition to the
new construction? What happened to those--what was it, 17?
Mr. Grauley. That is right. We had--Section 3 requires that
we report Section 3 hires against all new hires at the site.
And in the demolition phase, we had 17 Section 3 hires. That
was all of the new hires at the site, by our contractor.
In the new construction phase, we have--our latest report
to HANO is based on July and that was a total of 39 Section 3
hires on the site by the site contractors and subcontractors.
That number, as of today, has increased to 50, because as each
new contractor comes on site, new trades, painting, drywall is
just coming on site--
Chairwoman Waters. Let me try and understand. The first 17
that you hired, are they still working?
Mr. Grauley. The demolition work is complete, so they are
not working now.
Chairwoman Waters. That is complete, so that 17 is not
there now.
Mr. Grauley. Not at this time, they were hired for
demolition.
Chairwoman Waters. Okay, so the 39 that you are referring
to that you described as Section 3, they are now working on new
construction, is that right?
Mr. Grauley. Yes, they are. There are a couple who had been
working and who are no longer working, one--
Chairwoman Waters. I beg your pardon?
Mr. Grauley. There are a couple of those who have been
working and who are no longer working, but we reported them as
part of the total.
Chairwoman Waters. How many of the 39 are actually working
today, have jobs?
Mr. Grauley. Based on the numbers that I have, that would
be 37.
Chairwoman Waters. About 37?
Mr. Grauley. It would be 37.
Chairwoman Waters. And what about--what is this number 50
that you referred to, what does that include?
Mr. Grauley. We report this every month and it builds every
month as we have more contractors on site, we have more trades
on site, more opportunities. So 50 is as of August, the 39 is
as of July. We reported to the community as part of your
package in June that had a lower number than that. It is
building as we go through.
Chairwoman Waters. Is this report a report that is
cumulative of all the people that you have hired or are these
new hires?
Mr. Grauley. It is both, Madam Chairwoman, it is--
Chairwoman Waters. So the 17 who are no longer working
there may be showing up in this 50 number, is that right?
Mr. Grauley. There may be--
Chairwoman Waters. It probably is. Okay, Mr. Key.
Mr. Key. We just completed demolition, so we have not gone
vertical yet, so our construction work has only been mainly
demolition and beginning of infrastructure.
Chairwoman Waters. How many people did you hire during
demolition, residents?
Mr. Key. We had 21 Section 3 employees.
Chairwoman Waters. Twenty one residents.
Mr. Key. Out of the 21, I do not know exactly how many were
residents, it was about maybe 10 or 12 residents.
Chairwoman Waters. About 10 or 12 residents. And those 10
or 12 are still working or no longer working? Demolition is
over.
Mr. Key. Is done.
Chairwoman Waters. So they are not working?
Mr. Key. No.
Chairwoman Waters. Are you in new construction?
Mr. Key. We are not in construction yet.
Chairwoman Waters. That is it.
Mr. Key. Yes.
Chairwoman Waters. All right. Mr. Freeman?
Mr. Freeman. During demolition, we had 23 Section 3, that
was 87 percent of all demolition staff on site. During
construction, we are at 55 percent of new hires, which is 12
Section 3. Overall, which includes community supportive
services, we are at 79 percent, which is 58 Section 3 hires.
Chairwoman Waters. What was that bottom line, 58?
Mr. Freeman. Fifty eight, yes.
Chairwoman Waters. Total, including the--
Mr. Freeman. Community and support services.
Chairwoman Waters. --the 23, the ones on demolition?
Mr. Freeman. It does include demolition.
Chairwoman Waters. I beg your pardon?
Mr. Freeman. It does include--
Chairwoman Waters. And demolition is complete?
Mr. Freeman. Demolition is complete.
Chairwoman Waters. So 23 of the 58 are not working any
more.
Mr. Freeman. That may or may not be true. Some may be with
some of the contractors.
Chairwoman Waters. Well, tell me what is true.
Mr. Freeman. I cannot tell you how many of the demolition
were hired by--
Chairwoman Waters. Okay. Well, we are going to have to get
some oversight on these resident jobs and we are going to have
to understand it a lot better.
And our numbers have to be--yes, Ms. Marshall, what do you
know? Maybe Ms. Marshall can help us out.
Ms. Marshall. I do want to state as it relates to the
demolition, we really did have to fight to get residents hired
with the demolition process, because at first when that
contractor came in there, there were no residents hired. We
brought it to the attention of McCormack Baron Salazar and they
addressed the situation and for many reasons that contractor
was cut. So that issue was addressed, and as a result of that,
we coordinated that construction training program.
But there needs to be more enforcement with the contractors
to have some kind of set rules in place that if they do not
adhere to hiring Section 3 qualified individuals, you hold
their money or something or the contract is cut.
But as it relates to the C.J. Peete construction training
program, we have had two training sessions thus far. Our next
session is on September 28th. We have trained 33 individuals.
Out of the 33, 22 new hires. We have exceeded the Section 3
first hire mandate by 55 percent. Ten of the residents were
C.J. Peete residents. We had three residents from B.W. Cooper.
And when I stated that we are trying to coordinate with other
sites, we recognize, we were awarded a whole big $20 million
funding grant, so wherever we can help other residents at other
sites, the goal is to train them and those developers hire them
at that site. So those individuals--and we work very closely
with B.W. Cooper and we are reaching out to other sites to send
as many residents over so they can get those jobs on those
sites as opposed to others.
Chairwoman Waters. Thank you very much. This is a real bone
of contention with me. I do not think that people who are
unemployed should stand around and watch other people who come
from every place else, working on their site where they used to
live or where they are going to live, and not be hired. So that
is a real problem that needs to be monitored and oversight
needs to be done. And we will be talking about how we get that
done.
Now let me just move to this criteria that is being
developed. How many of the developers have developed criteria
that would require credit checks for people moving into these
units?
[Mr. Freeman raises his hand.]
Chairwoman Waters. Why?
Mr. Freeman. It is for all residents, not just public
housing residents and it is--
Chairwoman Waters. I do not care about all residents. All I
want to know about is public housing residents right now.
Mr. Freeman. It is just a check to make sure that folks are
who they say they are and it is just another check to make sure
that they are on the list properly with the housing authority.
Chairwoman Waters. Well, if you are vetting to see if
people are who they say they are, there are a lot of ways to do
that. But one of the things I have a real problem with is
people being denied because they have credit problems. If you
are poor, you have credit problems. And I do not want people
denied because they have credit problems. So what do you use
this information for?
Mr. Freeman. We do not deny residents because they have
credit problems. If there are things on their credit that makes
it hard for them to get utilities, they work with the case
management in the community center, which works with them
through those credit agencies and we work with them well before
lease up to make sure that they are ready for occupancy and can
get utilities in their name and they are ready to move into the
units.
Chairwoman Waters. It is great if you are helping people
with utilities, but again, I am adamantly opposed to the
refusal of rental units to people who have poor or weak credit.
Let me also ask about this work requirement. You have work
requirements, Mr. Grauley?
Mr. Grauley. The documents that we have with HANO have a
work requirement for head of household and co-head of household
for all the residents of--
Chairwoman Waters. This is not a move-to-work housing
authority.
Mr. Grauley. I am not aware that it is. But this was part
of our application from the outset, it was part of what we
reviewed with HANO and with HUD and part of what was adopted as
part of the management plan, the regulatory and operating
agreement, etc.
Chairwoman Waters. That is being challenged in one of our
advocacy groups that was here today. The Advancement Project is
looking at this issue. And we will follow up on it.
What about Enterprise, do you have credit requirements and/
or work requirements?
Ms. Whetten. As I understand it, as mandated by HUD or HANO
policy, credit checks are conducted only on applicants who have
a prior history of rent payment issues with the Housing
Authority of New Orleans. Beyond that, we do not conduct credit
checks.
And we do not have a work requirement.
Chairwoman Waters. And the credit check is on residents who
had previous problems with paying their rent?
Ms. Whetten. That is my understanding, yes.
Chairwoman Waters. Do you understand that even if there
were residents who had previous problems paying their rent,
unless they were evicted, they should be eligible?
[no response]
Chairwoman Waters. You do not know that either. Do not
worry.
Mr. Key?
Mr. Key. As I mentioned earlier, we have yet to create
our--
Chairwoman Waters. I cannot hear you.
Mr. Key. We have yet to create our structure for rental
policy. We will be working with the residents, the investor,
and HANO to do so.
Chairwoman Waters. You are smart, Mr. Key. Work with the
residents.
Mr. Freeman?
Mr. Freeman. We do not have a work requirement.
Chairwoman Waters. Good.
I reviewed some of the identified requirements and it
appeared to be almost hearsay. Information that has been
presented by somebody sometime somewhere about somebody's
character. Do you have such loose requirements, Mr. Freeman?
Mr. Freeman. Character? No.
Chairwoman Waters. Run down your requirements for me.
Mr. Freeman. We do not have those loose requirements.
Chairwoman Waters. What requirements do you have?
Mr. Freeman. We do have the same screening process that
HANO requires.
Chairwoman Waters. I do not know what it is. I want you to
tell me.
Mr. Freeman. To verify that they are eligible for public
housing. We do criminal background checks.
Chairwoman Waters. Okay. What else?
Mr. Freeman. And the credit checks.
Chairwoman Waters. Okay. Do you send people out to visit
folks to view their living conditions before they can move in?
Mr. Freeman. Yes, all residents do receive a home visit.
Chairwoman Waters. Is this what the residents told you they
wanted you to do?
Mr. Freeman. This was in consultation with the residents
and they did not object to it.
Chairwoman Waters. I did not ask if they objected. I asked
if they told you this is what they wanted.
Mr. Freeman. That is my understanding, but I will let Ms.
Marshall speak for herself.
Chairwoman Waters. Ms. Marshall, is that part of the
requirements that residents helped to develop, that there be
home visits to determine whether or not people should get
units?
Ms. Marshall. Yes. That is something that we actually
proposed to the resident council and we thought the residents
were really going to have a fit with that. But it was presented
to residents at our community meeting and to my surprise, you
know, a few residents asked questions in regard to it, but we
consult with legal every day basically and legal is at the
table and one of the things I asked legal was if someone may be
living somewhere and their living conditions are not up to par,
legally can they deny that resident to return. And the answer
is no, so I do not know--
Chairwoman Waters. What do you know about this, Ms.
Johnigan?
Ms. Johnigan. About what--
Chairwoman Waters. About what you guys--you said they
developed their criteria in conjunction with the residents. Did
you all require or are you going to require or have you
required that there be a home visit before people can get a
unit?
Ms. Johnigan. Because we still have families on site, we go
out to visit the home. That has been a part of our process, to
look at it to make sure that the resident--that the work that
we have done, that the residents are still living in safe and
sanitary conditions.
Chairwoman Waters. Did I not visit you at your home?
Ms. Johnigan. Yes, you did.
Chairwoman Waters. I was at your house. I understand how
the residents--you are strong over there.
Ms. Johnigan. Yes.
Chairwoman Waters. I remember that.
Ms. Johnigan. But I have a smaller apartment now.
Chairwoman Waters. I thought they were expanding your
apartment when I was there?
Ms. Johnigan. I moved to a smaller apartment.
Chairwoman Waters. Oh, I see, okay, all right. I remember,
yes.
Ms. Johnigan. But anyway, what we have to do is--that is a
part of what we do, to make sure that the work we have done
when we redid it, that our residents are keeping their
apartments up to par. So that when something happens, it is
nothing that we have done. Okay? So when we get ready to start,
this is something that Mr. Key, and we were in a retreat
yesterday talking about how we are going to go about putting
the new lease together and what are the requirements going to
be.
Chairwoman Waters. Would you come up with a requirement
that if someone's home has not been kept up in a way that you
would want it to be kept up and thus they would be denied a
unit?
Ms. Johnigan. No, let me go back and tell you why it makes
it so unique for the relationship that we have. We have told
Mr. Key, they have been out there and looked, some of the
apartments have people living in them we already know have one
bedroom. So if you go in and you see different things here and
there, that is because that one bedroom is still not
comfortable enough for a person to live in. So when you go in,
do not think that person cannot pick up, it is the fact that
there is no closet space, no kitchen space, no bedroom space.
So there are boxes in corners and things like that. Cleanliness
means if you go in and there is a greasy stove that you can use
without even lighting a match are things that are
inappropriate. But no, when we talk about coming in, you have
to look at the situation they are in now. Even under Section 8
housing, if they go look, you have to look at the way that
house is too.
Chairwoman Waters. All right. I think I saw several
instances where you talked about resident councils or advocates
who are going to be a part of the development, who will truly
have the opportunity to speak for the residents and be involved
in decision-making. The formulation of the resident councils or
resident involvement now should be just that. If it is not, is
there something else we need to do in order to ensure that
there are well organized resident councils and involvement? I
think Ms. Mingo, you said nobody pays any attention to what you
say anyway.
Ms. Mingo. No.
Chairwoman Waters. And that you do not feel as if you have
the ability to influence these decisions. What do we need to do
to strengthen the resident council?
Ms. Mingo. First of all, the developer needs--they need to
start building a relationship and stop ignoring and neglecting.
I was one of the very first persons on the ground when they
tore down the first brick in St. Bernard. They went straight
non-stop because we were so strong trying to stop them. To my
knowledge, and I was there, we never had any job training, we
have no more than five residents working on that ground.
If you ask Mr. Grauley or one of his colleagues a question
when we are--I have so much anger in me with them, but when I
go to their meetings to ask them to break it down--because some
of the stuff they are talking about, really I do not understand
it. So I try to break it down to the same level with me and a
resident. But if you ask them and you make them angry--we have
residents right now that was here with me at that meeting. They
will walk out on you. And the whole meeting will be shut down.
I went to the last meeting so I asked Mr. Grauley or one of his
colleagues who is sitting four rows back to explain what
straight public housing is and what tax credit public housing
is. So first I asked a resident and she said well, she told me,
he told me. I said no, they did not explain it the way for you
to understand. So the next time we went to a meeting, they
didn't explain it because I walked out, I was so mad. So it was
a big old thing, but after I explained it some kind of way,
they explained it the right way.
And she got very angry because when they explained it, they
said oh, no, there are 157 public housing residents, straight
public housing residents can return. Columbia, they talked to
probably one person who used to be on HANO's board, but people
who are on the ground who are fighting that are not getting
picked, they totally ignore. The only way we will get
attention, we have to bring 50 and 60 people to get attention.
And if you bring that, you are cut out, period.
We do not have job training. When they demolished the
buildings, everybody came running to me because they know we
are out here, we were requesting jobs for them. We even went up
to HANO building, all the people who sent them and when they
went, they said oh, no, we have to put you on another site. I
do not care what site you put them on. Like Ms. Jocquelyn was
saying, as long as you are a public housing resident and you
get on a site to help rebuild this. I never asked for a job
with this because I do not want a job, I have a job. I do not
want anybody to dictate to me, I will fight and say what comes
from my heart.
Chairwoman Waters. So from your point of view, Mr. Grauley
is not all that he says he is, is that right?
Ms. Mingo. No. I never--this my first time meeting Mr.
Grauley--this is my first time seeing him.
Chairwoman Waters. Okay.
Ms. Mingo. This is my first time ever seeing him. You
cannot hold a conversation with staff, because if you don't
understand while they read through their list, they act like
you are not even there.
Chairwoman Waters. Do you have some people you want to
report to him who have treated you in the fashion that you are
describing? Do you have some names you want to give him so he
can see if he can correct this?
Ms. Mingo. Well, he can talk to Monica in the back. When
you are sitting up in a meeting and you ask her a question, she
[motions].
Chairwoman Waters. Which one is she?
Ms. Mingo. She rolls her eyes.
Chairwoman Waters. Is she here?
Ms. Mingo. Right there, yes.
Chairwoman Waters. Really?
Ms. Mingo. She will not talk to you. And there is another
guy, I forgot his name. I tell you, I have so much anger. When
you had a mother who died in Katrina because she wanted to come
to St. Bernard--these people do not do any training. They say
they have 50, you go count them. People across the street from
public housing by the grocery store watch as others take jobs
that rightfully belong to surrounding communities. Now I do not
have a problem with the people who are working, but I do have a
problem when St. Bernard residents come and ask you and beg for
the crumbs, can we pick up a brick? When St. Bernard was down,
public housing did not pick up any bricks. The only reason why
I have two St. Joseph bricks is I went in and I got some St.
Joseph bricks. And I can tell you a lot of other St. Bernard
residents went up to save St. Joseph brick for remembering. St.
Bernard is not like that and that is why what Jocquelyn was
saying, that is good and I recommend her and I love her, but
only if they can start by building a relationship and stop
ignoring us, maybe me and the others, we would not be so angry.
Because I know when I said my testimony, I know you can hear
the anger in me. They do not tell you anything, they do not
want to talk to you. We just had our own job fair, one of these
guys, I do not know his name, but somebody in the audience
knows his name.
Chairwoman Waters. Okay, I get it. Now obviously you need
to develop a relationship. No matter what you say, the only
thing that is true is the fact that they do not feel, and Ms.
Mingo does not feel, that you have the kind of working
relationship that is respectful. So you all need to work that
out.
Let me ask Mr. Grauley, do you have any minority joint
venture partners in your development? Minority partners in your
development.
Mr. Grauley. Well, we have--
Chairwoman Waters. Minority partners.
Mr. Cao. As part of the development team?
Chairwoman Waters. Yes.
Mr. Grauley. Columbia Residential is--
Chairwoman Waters. I beg your pardon?
Mr. Grauley. Columbia Residential is a minority-owned
business, we have numerous contractors--
Chairwoman Waters. No, no, I am not asking about the
contractors now, those are the people that you employ. I am
asking about your development company, do you have minority
partners?
Mr. Grauley. Yes, Columbia Residential is a--
Chairwoman Waters. I beg your pardon?
Mr. Grauley. Columbia Residential is a minority-owned
business enterprise.
Chairwoman Waters. Oh, it is?
Mr. Grauley. Yes, it is, ma'am.
Chairwoman Waters. And who are the minorities?
Mr. Cao. Noel Khalil is the founder and chairman.
Chairwoman Waters. Who is?
Mr. Grauley. Noel Khalil is the founder and chairman and
built the company over the past 17 years. He does not wear his
minority status on his sleeve at all, but it is the truth about
our company.
Chairwoman Waters. We will check it out.
What about Enterprise, do you have minority partners?
Everybody at Enterprise is minority, right?
Ms. Whetten. Well, obviously, that is not the case. No, if
you are asking just the members of the development team, the
co-developers, we do not.
Chairwoman Waters. You do not. Mr. Key, obviously you are
the CEO of the company. Did you joint venture with any other
minorities?
Mr. Key. No. We partnered with the BWCRMC, they are our
partners.
Chairwoman Waters. Okay, Mr. Freeman, what about you guys,
McCormack Baron Salazar, do you have minority partners?
Mr. Freeman. Tony Salazar is the minority partner in the
firm and we partnered with KAI Design and Build.
Chairwoman Waters. What is your partner?
Mr. Freeman. KAI Design and Build.
Chairwoman Waters. In St. Louis?
Mr. Freeman. Yes, ma'am.
Chairwoman Waters. Okay, we will check it all out and see
what is happening with these developers.
You have something you are just dying to say, Mr. Grauley.
What is that?
Mr. Grauley. I would just like to respond to Ms. Mingo. I
appreciate the anger that she has, but the fact is that we do
meet regularly, we do review with the resident council, who are
the resident leaders, not represented right here. On a regular
basis, we have met over the past 2 years as part of the design.
There are a lot of questions that come up, and we try to
respond to those. I have met Ms. Mingo, I met her first in July
of last year at a meeting. We also have responded to her letter
of June to the housing authority. And so I just wanted to set
that straight. We take it very seriously and we are trying to
work with the residents.
There are concerns that are raised, there is not always
agreement and obviously we would like to do better with that,
but to state that we do not hear and to state that our staff is
not trying to hear the concerns of residents, I just wanted to
put that straight.
Chairwoman Waters. As I said, you obviously need to develop
a better working relationship. Ms. Mingo would not be here in a
public meeting with these complaints and this kind of anger if
she was happy, or if she was satisfied, or if she thought you
had done your best. So it is on you to do what you can to
develop a better relationship and have the people who work for
you treat people respectfully and answer their questions and
who do not snub or turn up their noses at them. That is just
not acceptable and it leads to problems.
So I hope you take her concerns seriously.
Thank you all for being here today. You have helped me so
much.
And I guess I have some things I have to do here.
Some members who have participated here with me 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.
And before we adjourn, the written statement of Mr. Sam
Jackson will be made a part of the record of this hearing.
With that, I think I have complied with all that I must
comply with. And this hearing is adjourned. Thank you so very,
very much. Thank you for your participation.
[Whereupon, at 2:25 p.m., the hearing was adjourned.]
A P P E N D I X
August 21, 2009
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