[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]
OVERVIEW OF THE FAMILY
SELF SUFFICIENCY PROGRAM
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON
HOUSING AND INSURANCE
OF THE
COMMITTEE ON FINANCIAL SERVICES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTEENTH CONGRESS
FIRST SESSION
__________
SEPTEMBER 27, 2017
__________
Printed for the use of the Committee on Financial Services
Serial No. 115-42
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HOUSE COMMITTEE ON FINANCIAL SERVICES
JEB HENSARLING, Texas, Chairman
PATRICK T. McHENRY, North Carolina, MAXINE WATERS, California, Ranking
Vice Chairman Member
PETER T. KING, New York CAROLYN B. MALONEY, New York
EDWARD R. ROYCE, California NYDIA M. VELAZQUEZ, New York
FRANK D. LUCAS, Oklahoma BRAD SHERMAN, California
STEVAN PEARCE, New Mexico GREGORY W. MEEKS, New York
BILL POSEY, Florida MICHAEL E. CAPUANO, Massachusetts
BLAINE LUETKEMEYER, Missouri WM. LACY CLAY, Missouri
BILL HUIZENGA, Michigan STEPHEN F. LYNCH, Massachusetts
SEAN P. DUFFY, Wisconsin DAVID SCOTT, Georgia
STEVE STIVERS, Ohio AL GREEN, Texas
RANDY HULTGREN, Illinois EMANUEL CLEAVER, Missouri
DENNIS A. ROSS, Florida GWEN MOORE, Wisconsin
ROBERT PITTENGER, North Carolina KEITH ELLISON, Minnesota
ANN WAGNER, Missouri ED PERLMUTTER, Colorado
ANDY BARR, Kentucky JAMES A. HIMES, Connecticut
KEITH J. ROTHFUS, Pennsylvania BILL FOSTER, Illinois
LUKE MESSER, Indiana DANIEL T. KILDEE, Michigan
SCOTT TIPTON, Colorado JOHN K. DELANEY, Maryland
ROGER WILLIAMS, Texas KYRSTEN SINEMA, Arizona
BRUCE POLIQUIN, Maine JOYCE BEATTY, Ohio
MIA LOVE, Utah DENNY HECK, Washington
FRENCH HILL, Arkansas JUAN VARGAS, California
TOM EMMER, Minnesota JOSH GOTTHEIMER, New Jersey
LEE M. ZELDIN, New York VICENTE GONZALEZ, Texas
DAVID A. TROTT, Michigan CHARLIE CRIST, Florida
BARRY LOUDERMILK, Georgia RUBEN KIHUEN, Nevada
ALEXANDER X. MOONEY, West Virginia
THOMAS MacARTHUR, New Jersey
WARREN DAVIDSON, Ohio
TED BUDD, North Carolina
DAVID KUSTOFF, Tennessee
CLAUDIA TENNEY, New York
TREY HOLLINGSWORTH, Indiana
Kirsten Sutton Mork, Staff Director
Subcommittee on Housing and Insurance
SEAN P. DUFFY, Wisconsin, Chairman
DENNIS A. ROSS, Florida, Vice EMANUEL CLEAVER, Missouri, Ranking
Chairman Member
EDWARD R. ROYCE, California NYDIA M. VELAZQUEZ, New York
STEVAN PEARCE, New Mexico MICHAEL E. CAPUANO, Massachusetts
BILL POSEY, Florida WM. LACY CLAY, Missouri
BLAINE LUETKEMEYER, Missouri BRAD SHERMAN, California
STEVE STIVERS, Ohio STEPHEN F. LYNCH, Massachusetts
RANDY HULTGREN, Illinois JOYCE BEATTY, Ohio
KEITH J. ROTHFUS, Pennsylvania DANIEL T. KILDEE, Michigan
LEE M. ZELDIN, New York JOHN K. DELANEY, Maryland
DAVID A. TROTT, Michigan RUBEN KIHUEN, Nevada
THOMAS MacARTHUR, New Jersey
TED BUDD, North Carolina
C O N T E N T S
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Page
Hearing held on:
September 27, 2017........................................... 1
Appendix:
September 27, 2017........................................... 27
WITNESSES
Wednesday, September 27, 2017
Gornstein, Aaron, President and CEO, Preservation of Affordable
Housing........................................................ 4
Lubell, Jeffrey, Director of Housing and Community Initiatives,
Abt Associates................................................. 5
Riva, Sherry, Executive Director, Compass Working Capital........ 10
Siglin, Kristin, Senior Vice President, Policy, Housing
Partnership Network............................................ 9
Spann, Stacy L., Executive Director, Housing Opportunities
Commission of Montgomery County................................ 7
APPENDIX
Prepared statements:
Gornstein, Aaron............................................. 28
Lubell, Jeffrey.............................................. 32
Riva, Sherry................................................. 39
Siglin, Kristin.............................................. 50
Spann, Stacy L............................................... 55
OVERVIEW OF THE FAMILY
SELF-SUFFICIENCY PROGRAM
----------
Wednesday, September 27, 2017
U.S. House of Representatives,
Subcommittee on Housing
and Insurance,
Committee on Financial Services,
Washington, D.C.
The subcommittee met, pursuant to notice, at 3:03 p.m., in
room 2128, Rayburn House Office Building, Hon. Sean P. Duffy
[chairman of the subcommittee] presiding.
Members present: Representatives Duffy, Ross, Posey,
Luetkemeyer, Stivers, Rothfus, Zeldin, Trott, MacArthur, Budd;
Cleaver, Beatty, Kildee, Kihuen, and Gonzalez.
Chairman Duffy. The Subcommittee on Housing and Insurance
will come to order.
Without objection, the Chair is authorized to declare a
recess of the subcommittee at any time.
Also, without objection, members of the full Financial
Services Committee who are not members of the subcommittee may
participate in today's hearing for the purposes of making an
opening statement and questioning the witnesses.
Today's hearing is entitled, ``An Overview of the Family
Self-Sufficiency Program.''
The Chair now recognizes himself for 5 minutes for an
opening statement. I want to welcome our witnesses, our
members, and our audience here today for our Housing and
Insurance Subcommittee hearing on the Family Self-Sufficiency
Program (FSS).
As we start to look at how to reform the housing finance
system--we are going to do that this fall--we also want to look
at programs that help those who cannot afford to purchase a
home and to utilize programs such as the the Family Self-
Sufficiency Program to reduce our dependency on welfare
assistance and rental assistance that is provided by the
Government.
We are joined by five great witnesses, each of whom work in
a capacity with this program, and we are looking forward to
their insightful commentary and the advice they have for this
subcommittee.
The Family Self-Sufficiency Program is focused on helping
families who are in public housing, Housing Choice Voucher
Program participants, residents of HUD-assisted housing, and
residents of the Project-Based Rental Assistance Programs.
The goal is to utilize a number of services coordinated
through the program to help families with individual training
to increase their employability and become less dependent on
government assistance. These services can include basic
education, childcare, transportation, education, job training,
employment counseling, financial literacy training, mental
health referrals, and home ownership counseling.
While receiving these services, an interest-bearing escrow
account is established for the family that can be used for any
purpose once the family graduates from the program. The Family
Self-Sufficiency Program is administered by the public housing
authorities who work with a program coordinator committee that
identifies partners, both public and private, for the operation
of the program.
Partners may include workforce investment boards, local
governments, and local departments of health, just to give a
few examples. These families generally enter into a 5-year
contract of participation that incorporates individual training
and a service plan. The service plan serves as a guideline of
goals and steps the family must make in order to graduate from
this program.
Through a Family Self-Sufficiency coordinator, they receive
supportive services needed to achieve economic self-
sufficiency, increase their employability and income, and move
towards independence from the public housing system and towards
home ownership.
In addition to the help families receive in supportive
services, an interest-bearing account is set up. The difference
between the initial rent and the increased rent due to
increased income goes into to the escrow account each month.
The escrow account can then be accessed by the family for
any reason once the program is completed. So here you have a
family who has gone through a program. They have the training.
They are self-sufficient, and they have a pot of money that
they can potentially use to put down on a house. Or they can
get a new or a used car that can effectively get them to work.
It is a program that actually makes a lot of sense.
So for the program to be completed, these families must
comply with the lease, be welfare-free for 12 consecutive
months, and the head of the family must seek and maintain
employment.
There are a lot of conversations we have about the programs
that come through this committee and how effectively they work,
but I think this is one where you look at providing people
services and moving them from dependence to independence, and
giving them that hand up that they need to get there makes a
lot of sense.
And again, I look forward to hearing from this panel on how
we can take a new look at the program. What are the bright
spots of the program? How is it working well? And what can we
do differently to maybe make some tweaks or changes to the
program so we can help a few more people?
If it works for some, maybe we expand that small number and
be able to grow it to a much larger number. So how do we take
lessons learned, good and bad, and make improvements that can
help more people? I am grateful for your participation, and I
look forward to your testimony.
And with that, I now recognize the ranking member of the
subcommittee, the gentleman from Missouri, Mr. Cleaver, for 5
minutes.
Mr. Cleaver. Thank you, Mr. Chairman. My mother actually
enrolled in Midwestern University when we were still living in
public housing. I think I was in the sixth grade when she
enrolled in Midwestern to pursue her degree in early childhood
and elementary education. Everyone can't do that and is not
going to be expected to do that.
And so I would have to declare that I think that the Center
On Budget and Policy Priorities was absolutely right when they
proclaimed this program as HUD's best-kept secret for promoting
employment and asset growth. I was mayor--to fast forward--of
Kansas City when George H.W. Bush signed this into law in 1990.
There was obviously going to be some apprehension about the
program, but overall I think that individuals who have
successfully completed the program after 5 years of
participation, and they receive the funds to use for various
jobs or housing needs, prove this program to be successful.
I welcome the opportunity to hear from those of you who are
kind enough to come in and provide us with testimony about the
program. We are still waiting on some results of a
comprehensive national assessment, individual experience in
administrating and participation in the program.
And I know that my longtime friend and colleague, Senator
Roy Blunt, has introduced a bill over in the Senate, the Family
Self-Sufficiency Act. And this bill, if approved, would make
important improvements to the program including the merging of
housing choice vouchers, the FSS program and Public Housing,
FSS program into--into one, expanding the scope of supportive
services and allowing project-based rental assistance residents
to be eligible.
I plan to introduce a House version of that same bill
shortly. Senator Blunt and I have had conversations about this
bill, and both of us are committed to trying to get a bill to
the President's desk.
So Mr. Chairman, thank you for holding the hearing. I know
this is not one of the more sexy issues to come up before the
committee. I noticed the empty seats and people are not--
there's no popcorn or anything.
I know we will try not to put you to sleep so we would--I
am going to ask that all of you witnesses to please put an
extra ounce of energy into your responses as we move through
this hearing. Thank you so much.
Thank you, Mr. Chairman.
Chairman Duffy. The gentleman yields back. I'm looking
forward toward a popcorn-filled, exciting hearing today.
So with that, let us welcome our witnesses. First, we have
Mr. Aaron Gornstein, the president and CEO of Preservation of
Affordable Housing. And our next witness is Mr. Jeffrey Lubell,
director of housing and community initiatives at Abt
Associates.
We then have Mr. Stacy Spann, executive director of the
Housing Opportunities Commission of Montgomery County. And then
we have our fourth witness, Ms. Kristin Siglin, senior vice
president of policy at the Housing Partnership Network. And
finally, last but not least, we have Sherry Riva, founder and
executive director of Compass Working Capital.
In a moment the witnesses are going to be recognized for 5
minutes each to give an oral presentation of their testimony.
And without objection, the witnesses' written testimony will be
made a part of the record.
Once the witnesses have finished their presentation, each
member of the subcommittee will have 5 minutes within which to
ask our panel questions.
And so with that, Mr. Gornstein, I now recognize you for 5
minutes.
STATEMENT OF AARON GORNSTEIN, PRESIDENT AND CEO, PRESERVATION
OF AFFORDABLE HOUSING
Mr. Gornstein. Good afternoon, Chairman Duffy, Ranking
Member Cleaver, and distinguished members of the subcommittee.
Thank you for the opportunity to testify regarding the Family
Self-Sufficiency Program, or FSS. I am Aaron Gornstein, and I
serve as the CEO of Preservation of Affordable Housing, or
POAH.
We are a private, nonprofit organization whose mission is
to preserve and create affordable homes that support economic
security. Since its founding in 2001, POAH has preserved or
built more than 9,000 apartments in 9 States and the District
of Columbia.
We believe that access to affordable housing is a crucial
step in overcoming the challenge of poverty. But we also know
that stable housing is only one part of the solution. POAH is
committed to using our housing as a platform for the delivery
of support services like onsite after-school programs to boost
educational achievement, budgeting programs to maintain
tenancies, and job training to help residents increase their
earnings.
That is why POAH was one of the first private owners of
HUD-assisted housing to adopt FSS. Last year we launched the
program at 4 sites, and then expanded to 7 this year with 1,100
eligible households. As the ranking member may know, we just
launched at Hawthorne Apartments in Independence, Missouri, for
example.
After 18 months, the program's early results are very
encouraging. We have enrolled 30 percent of our eligible
households, which is 6 times the national average.
At one of our original sites, 65 percent of the target
households are engaged and working towards earnings and savings
goals. We have already seen an average increase in earned
income of 14 percent. The percentage of participating
households who are employed has increased by 19 percent. And we
have had three households graduate from the program by reaching
their self-sufficiency goals and ending receipt of TANF
assistance.
We attribute this early success to three key factors.
First, our program is implemented by very committed and well-
trained property managers and a highly effective service
partner, Compass Working Capital. And you will hear from Sherry
towards the end of this panel.
Second, we use a site-based service model allowing
participants to access financial coaching, workshops, and other
resources where they live. And third, the HUD staff have been
fully committed to making the program successful. We also
appreciate Secretary Carson's personal interest in the FSS
program.
Finally, I want to suggest a few recommendations. First, we
are hopeful that Congress will create permanent authority for
FSS in privately owned assisted properties. The lack of
permanent authority means that owners face the risk that their
program may lapse in any year, leaving them unable to deliver
on the commitments they have made to participating families.
And second, we encourage Congress to clarify that the
escrow incentive should stay in place until a resident reaches
80 percent of area median income, rather than the current 50
percent cutoff. The current limitation prevents the program
from helping some residents climb the last few rungs on the
ladder to economic security.
POAH strongly supports S.1344, which Congressman Cleaver
mentioned, a bipartisan bill introduced by Senators Blunt,
Reed, Scott, and Menendez, because it responds to the
opportunities I have mentioned and makes a number of other
important improvements to strengthen the program. And we
certainly hope the House will introduce legislation that
mirrors those important provisions.
In conclusion I reiterate POAH's conviction that the FSS
program is a very promising tool that private owners can use to
help residents increase earnings, grow savings, and reduce
dependency on public assistance.
We would be pleased to work with the subcommittee on any
improvements and enhancements to the program, and I thank you
for giving me the opportunity to testify.
[The prepared statement of Mr. Gornstein can be found on
page 28 of the appendix.]
Chairman Duffy. Thank you, Mr. Gornstein.
The Chair now recognizes Mr. Lubell for 5 minutes.
STATEMENT OF JEFFREY LUBELL, DIRECTOR OF HOUSING AND COMMUNITY
INITIATIVES, ABT ASSOCIATES
Mr. Lubell. Thank you. Good afternoon, Chairman Duffy,
Ranking Member Cleaver, and distinguished members of the
subcommittee. Thank you for the opportunity to testify
regarding the FSS program.
My name is Jeff Lubell, and I am the director of housing
and community initiatives at Abt Associates. We are a mission-
driven research and consulting firm based in Cambridge,
Massachusetts, that conducts program evaluations, performs
research, and provides technical assistance and consulting
services on a wide range of social programs.
I have been researching and writing about FSS for about 20
years. Count me in the camp who opens up the popcorn when
something new comes out about FSS. And Ranking Member Cleaver,
I appreciate the metaphor there.
I would like to cover three main things: first, to just
elaborate a little bit more on how the program works; second,
to summarize what we know from research about FSS; and third,
to quickly identify some of the steps that HUD has taken in
recent years to improve the program.
So as has been mentioned, FSS was signed into law by the
first President Bush. It has enjoyed a long history of
bipartisan support over the years. It has three main pieces.
One is stable, affordable housing. You need that to be able to
focus on getting and keeping a job but that is not enough.
The second piece is case management or coaching to help
participating families achieve their career and financial
goals. And here I just want to emphasize that this is a very
cost-effective approach. It is not about duplicating services.
It is about linking families up to services that exist in the
community.
The third part is a financial incentive for families to
increase their earnings in the form of an escrow account that
grows as their earnings grow. Basically, everybody in
subsidized housing pays 30 percent of their income for rent.
But if you are in this program, an amount that is equal to
the increase in rent that is attributable to the increase in
earnings goes into this escrow account. And you get that money
if and only if you succeed in graduating from the program or if
you qualify for an interim disbursement, like if your car
breaks down and you need help getting it repaired so you can
get to work.
This is important because it helps people get used to
paying higher rent, which is an important part of ultimately
transitioning to private market housing. To graduate, you have
to achieve the goals that you set out, and you have to become
employed, and you have to get off of welfare assistance. All of
those things, I think, are things that we would all support.
On balance, the research evidence is positive. HUD has
funded two national studies that examined the growth of
earnings of FSS participants over time, and both found that
earnings grew substantially.
The most recent study found that after 4 years, about a
quarter of the families who graduated from FSS, their annual
earnings had increased from an average of $20,000 in 2006 to
$33,000 in 2009. That is a $13,000 increase, and it was not a
particularly strong period for the economy. And they had about
$5,294 on average in their escrow accounts.
Another quarter were still enrolled in the program and had
experienced meaningful gains in earnings and hours worked and
had escrow balances of about $3,500. They hadn't graduated
because the program is a 5-year program with an opportunity for
2 years of extension, so that is partly what is going on there.
There were families who were no longer in the program. We
can talk about that. It doesn't work for everyone, but it works
for a large share of people.
Unfortunately, there was no control group for this study,
and that is really important. You need a comparison group in
order to be able to say something definitive.
HUD has commissioned a randomized control trial. The early
2-year results from that trial are expected later this year or
early next year. But remember, FSS is a 5-year program. Those
early results are only going to cover 2 years. So we are not
going to have long-term outcomes for many, many years to come,
but stay tuned. It is going to be an important study.
Now, there have been a number of local evaluations. One of
them is something that we just conducted of the Compass Working
Capital programs in Cambridge, and Lynn, Massachusetts, that
they administer in partnership with the housing authorities.
And that looked at results after 40 months and were generally
very positive.
Specifically, when we compared the results for FSS
participants against the comparison, we saw that the Compass
FSS participants had earned $6,305 more. Their annual earnings
had increased by $6,000. That is about 30 percent. And their
annual welfare income had declined by $500.
They also had improved credit scores. They had reduced debt
levels, and reduced credit card and derogatory debt. I can talk
more about it, but I am running out of time, and there are
other studies I am happy to talk about, including one in New
York City.
I just want to emphasize quickly before I stop that HUD is
really investing in trying to make this program better. We
worked with them to develop a guidebook of promising practices
based on the experiences of a number of FSS practitioners
around the country. That came out along with an online
training.
We are also working with them on a system for measuring
performance, a performance measurement system that is very
close to coming out. It is nearly done and that will help
ensure that local programs are accountable for their results.
I look forward to the opportunity to answer any questions
that you may have. Thank you.
[The prepared statement of Mr. Lubell can be found on page
32 of the appendix.]
Chairman Duffy. Thank you, Mr. Lubell.
Mr. Spann, you are now recognized for 5 minutes.
STATEMENT OF STACY L. SPANN, EXECUTIVE DIRECTOR, HOUSING
OPPORTUNITIES COMMISSION OF MONTGOMERY COUNTY
Mr. Spann. Good afternoon, Chairman Duffy, Ranking Member
Cleaver, and members of the subcommittee. Thank you for the
opportunity to testify.
My name is Stacy Spann, and I am the executive director of
the Housing Opportunities Commission (HOC) of Montgomery
County, in Montgomery County, Maryland.
Our housing commission is the largest provider of high-
quality, amenity-rich, affordable housing to low- and moderate-
income households in our county. And as a designated public
housing agency, we are serving approximately 13,800 households
through all of our housing programs, including administration
of the voucher program as well as other Section 8 programs.
We also operate non-Federal affordable housing programs as
well as finance and develop affordable housing units throughout
our county. In our role as housers, we take great pride in the
enrichment of programs and supportive services we are providing
to connect our customers and helping folks reach their fullest
potential.
HOC is delivering robust workforce and education
programming for adults and youth, including our Fatherhood
Initiative, a suite of educational opportunities for adults and
youth, we call HOC Academy. And in addition to HUD's FSS
program, we are working hard to transform lives by providing
career development support.
The participants that we are working with are receiving
comprehensive case management and service connections that
support them in gaining and improving employment through one-
on-one assessments, goal-setting, referrals, skills training,
and education.
Since HOC's FSS program began in 1993, we have graduated
938 participants from the program, and it has actually evolved
significantly since we began. In 2015, we had a shift in
leadership and took the opportunity to examine our program,
look inward, and really figure out how we could administer the
program better.
We wanted to ensure that enrolling customers in our FSS
program and guiding them through the process was not just pro
forma. We are not interested in simply checking the box and
tallying the numbers. We took a step back and asked ourselves,
what are we doing to help our customers achieve progress?
Are we requiring people to take meaningful strides toward
self-sufficiency in order to graduate? And we understand that
making a decision to change your life is difficult.
As an agency, what we wanted to do was be certain that we
are giving our customers our best effort to do this, this
personal and extremely deep work. If participants were
graduating only to find that they were accessing emergency
rental assistance programs or facing eviction just a few months
later, then we are clearly not doing our jobs.
So in taking the time, we actually decided to re-tool the
program in its entirety. And in fact, the case managers are now
the persons who are responsible for working with families from
the start to the end. And when they are coming up for
recertification, our folks are actually doing that work as
well.
Unfortunately, we lost some individuals, but what we gained
was real quality in the group of individuals that we are
working with. We reopened our program, and just last week, on
the 21st, we celebrated our gradation.
And there we were celebrating the accomplishments of 63 FSS
graduates. Where 52 percent of those graduates were unemployed
at enrollment, 100 percent were employed by graduation, having
at least 12 consecutive months of employment.
And as a group, the average earned income of the
participants quadrupled from $8,000, a little over, to about
$37,393 annually. So that is a huge increase, but we have more
work to do.
Through our mortgage programs, our own homeownership
initiatives, we are able to support families. And while our
graduates are accomplishing much, it is little as compared to
their peer group in Montgomery County where the average income
is over $100,000. That gap is significant. So we have miles to
go.
I wanted to take, in my last seconds, an opportunity to
thank you and say, while this is difficult and challenging
work, authorities, agencies who are doing the work should not
be penalized when they take a step back and really examine how
they are meeting the customers' needs.
And so if there are any improvements to be made, certainly
I am happy to work with this august group on the panel, as well
as those at HUD.
The improvement ought to be that every single family can't
do the same work, the same way. Every single family is not
engaged the same way. And unfortunately, there is no one-size-
fits-all in this program. Thank you very much.
[The prepared statement of Mr. Spann can be found on page
55 of the appendix.]
Mr. Ross [presiding]. Thank you, Mr. Spann.
Ms. Siglin, you are now recognized for 5 minutes for your
opening statement.
STATEMENT OF KRISTIN SIGLIN, SENIOR VICE PRESIDENT, POLICY,
HOUSING PARTNERSHIP NETWORK
Ms. Siglin. Good afternoon. I am Kristen Siglin, senior
vice president of policy at the Housing Partnership Network
(HPN), a business collaborative of nearly a hundred nonprofits
that develop and finance affordable housing and community
development projects in all 50 States.
HPN members work together on businesses that make them more
efficient and effective at delivering affordable housing. For
example, HPN members together own a property and casualty
insurance company that insures their apartments.
HPN members also work together on public policy and learn
from each other, which is what leads me to FSS. In 2014, two
HPN members, Preservation of Affordable Housing, which you
already heard from, and the Caleb Group, approached me and said
that they wanted to offer FSS to their residents.
At the time, FSS could only be administered by housing
authorities for public housing residents, or voucher holders.
But FSS is a very intuitive model that makes a lot of sense. It
combines the three elements you have heard of: stable,
affordable housing; financial coaching; and an escrow account
to help the residents build assets.
So in 2015 the appropriations committee, with some support
from members of this committee, agreed to open up the FSS
program to Project-Based Rental Assistance. When the law was
changed, these HPN members, who had already been thinking about
this and wanting to do this asset building work with their
residents, got to work.
And you have already heard from POAH, so I will talk about
the other HPN member, the Caleb Group, which actually worked
with Compass Working Capital on the coaching piece of the
project.
The Caleb Group owns 2,000 units of affordable housing in
four States: Massachusetts; Connecticut; New Hampshire; and
Maine. And their first FSS projects were in Willimantic,
Connecticut, and another one in Gloucester, Massachusetts.
And the residents have not completed their 5 years yet, yet
of the 34 families who have began the program, already 5 of
them have graduated. Four of those families created escrow, and
the average escrow was $8,543. So that is significant.
Three of them used that escrow to buy a home. The CEO of
the Caleb Group, Debbie Nutter, e-mailed me and said, ``The
major point is how satisfying it is to show folks how they can
make the leap.'' That is what she wanted me to tell you.
There are two important points to make about FSS. One is
that the program is voluntary. Housing authorities and project-
based owners choose to offer it or not, and residents choose to
participate or not. And I think this aspect, that it is a
coalition of the willing, makes it an effective program.
The other thing is it is very small in the universe of HUD
programs. According to the latest figures from HUD, there are
72,000 families currently enrolled in FSS. So if if you find
this model appealing, there is something you can do to help:
Introduce and pass legislation similar to the Senate
legislation introduced by Senator Roy Blunt of Missouri and
Senator Jack Reed of Rhode Island. To us, the most important
part of the Blunt-Reed bill is making permanent that extension
of the program to privately owned rent projects with rental
assistance, because currently, private nonprofits are not
eligible to compete for the service coordinator dollars that
housing authorities use to run the program; that money is all
spoken for. So our members do private fundraising, as Aaron
Gornstein did.
It is hard to convince members to open an FSS program when
they want to be able to do it--it is a 5-year program. You need
to offer that escrow every year. So it would be very helpful if
you all permanently authorized the extension of FSS to project-
based rental assistance.
In conclusion, I would like to commend this subcommittee
for shining a light on this program. If new housing providers
can offer FSS for the residents, we can continue to amass
evidence on what works to help residents to achieve more
success.
This is a voluntary program that could become a model for
using the power of stable, affordable housing, to help families
achieve their dreams. It would be very impressive in a time of
partisan division over so many issues for this subcommittee to
come together around improvements and expansion of a program
that makes a great deal of common sense and gives families a
tangible path to hope and opportunity.
Thanks for inviting me.
[The prepared statement of Ms. Siglin can be found on page
50 of the appendix.]
Mr. Ross. Thank you, Ms. Siglin.
Ms. Riva, you are now recognized for 5 minutes.
STATEMENT OF SHERRY RIVA, EXECUTIVE DIRECTOR, COMPASS WORKING
CAPITAL
Ms. Riva. Good afternoon, Chairman Duffy, Ranking Member
Cleaver, and members of the subcommittee, and thank you for the
opportunity to testify today about the Family Self-Sufficiency
Program.
My name is Sherry Riva, and I am the founder and executive
director of Compass Working Capital. We are a nonprofit
financial services organization headquartered in Boston,
Massachusetts.
I am here today to share my deep support for the FSS
program and my thoughts on ways in which Congress can take
action to expand the scope and impact of the program around the
country.
There are three key points I would like you to remember
from my testimony today. First, the FSS program empowers low-
income American families to transform their own lives. It
provides opportunities for working families to save for and
invest in themselves, in their children, and in their futures.
Second, as you heard from Jeff Lubell, the FSS program is a
promising, evidence-based model that has enjoyed strong
bipartisan support since it was introduced in the 1990s. FSS
promotes work, it helps people build savings, and it creates
the conditions for families to move themselves up and out of
poverty. It is ripe for expansion and for greater public-
private partnership.
And finally, the most important action this subcommittee
can take is to introduce legislation that mirrors the
provisions of the Family Self-Sufficiency Act, the bill that
was recently introduced in the Senate.
Let me just briefly take a step back and tell you more
about Compass, how we do this work, and why we chose to focus
on the FSS program as a tool to achieve our mission.
We are not housers at Compass. Our mission at Compass is to
help low-income families build assets and financial
capabilities as a pathway out of poverty. Our work is grounded
in two core fundamental beliefs. First, poverty is not just an
income problem. It is a wealth problem. All people need and
deserve access to opportunities to save for and invest in
themselves and in their families.
And the second belief is this: Low-income families have
hopes and dreams for themselves, their children, and their
futures, as all of us do. And our experience at Compass is that
families want to work, they are working, and they want to get
ahead.
And our job, our first job at Compass is to tap into these
deeply held aspirations and invest in families' abilities to
transform their own lives. So at Compass we saw in the FSS
program an incredibly powerful tool to help low-income American
families who live in subsidized housing to escape poverty and
to access broader economic opportunity. And that is why we have
dedicated ourselves for the last 7 years to expanding the scope
and impact of this program around the country.
The Compass FSS program builds on the fundamental
components of the FSS program, which is affordable housing,
service coordination, and access to this escrow account, which
my follow witnesses have discussed. And we combine that core
model with robust financial coaching and education to drive
even stronger outcomes for participants.
We partner with public housing authorities and affordable
owners in Massachusetts, Connecticut, and Rhode Island. And
building on our success in New England, in late 2016 we
launched a national network to support mission-aligned partners
in other parts of the country to unpack that power of this
wealth-building model in their own communities.
Our initial partners in the national network are in Maine,
Missouri, Mississippi, and Illinois, and we field new inquiries
from housing partners around the country every single week.
The best way though to hear and understand the power of the
FSS program is to share a story. So I am going to, in closing,
take a moment to tell you about Tanya Febrillet, who is a
graduate of our FSS program in Lynn.
When Tanya enrolled in our program she had been receiving
housing assistance for 4 years. She was working full-time,
raising her two kids, but she had bigger dreams, including
owning her own home.
At the time, Tanya believed that owning a home--and these
are her words not mine--``wasn't for families like mine, a
single, low-income mother who came from a family where no one
had ever been a homeowner.''
The FSS program was just what Tanya needed to achieve her
dreams. After she joined FSS, she started working with a
financial coach. She increased her income by nearly $8,000,
improved her credit score by 140 points, saved about $3,000 in
her escrow account, and became a homeowner. She graduated in
2015 and became a homeowner, the first person in her family to
do so.
The truth is, and the most important thing to say today is
that there are so many more families like Tanya's that we can
and should be reaching in this program.
By bundling affordable housing assistance, support for
families, and a savings account, FSS is a fundamentally strong
program, and we believe it can be even stronger and help more
families escape poverty and achieve their dreams. Thank you.
[The prepared statement of Ms. Riva can be found on page 39
of the appendix.]
Mr. Ross. Thank you, and I thank the witnesses for their
testimony.
I will now recognize myself for 5 minutes for questions. In
my area of central Florida, we have a significant need for
affordable housing. In fact, in the Tampa Bay area we have over
13,000 applicants on a waiting list for affordable housing.
Affordable housing not only has to be affordable, but it
also has to be available. And FSS has been probably one of the
more premier programs because not only does it allow them to
develop, over time of course, their home ownership, but it
instills in them a sense of dignity, a sense of dignity in
family, a sense of dignity in success of what they have been
able to accomplish, achieve, and own.
And so for that reason, the Tampa Bay Housing Authority
went back to HUD and asked them if they could expand the
program. And I was told that unfortunately HUD informed them
they were not allowed to do so and provided little explanation
for that.
My first question is, have any of you experienced similar
situations with HUD in trying to expand the FSS programs? Who
would like to start?
Yes, sir, Mr. Lubell?
Mr. Lubell. Yes. If I may? My understanding is that any
housing authority that wants to expand its program is
absolutely free to do so. In order to do that, they simply have
to revise their FSS action plan and submit it to HUD. The
question is whether they can get funding for the FSS
coordinators that run the program, which is different from
being able to operate the program.
So there are two things. They could expand it very easily
by submitting the revised action plan. But the problem is, that
funding has been level for many years and their first priority
has generally been provided to the agencies that are currently
running it so that they can continue to serve people throughout
the course of their 5-year period.
So in order to provide additional funding for more agencies
there would need to be an overall lift of the cap in funding
provided. I know that is not your job. You are the
authorizers--
Mr. Ross. Right.
Mr. Lubell. --but I am just explaining, I think, what the
issue might be.
Mr. Ross. I appreciate that. Anyone else?
Mr. Spann?
Mr. Spann. Sure. I certainly agree with, Mr. Lubell. It is
completely that. I would also add, though, that there is a
funding formula. And so the challenge becomes, again, the
number of persons who are registered participants versus
quality of actual engagement.
The truth of the matter is, we opted for quality of
engagement so that once someone actually ascends and graduates
from our program, that individual is able to support his or her
family--
Mr. Ross. I think that is the point there. If we are
looking at scoring this for increased funding and to make sure
that we can afford to do this, we have to look at the outcomes.
And Mr. Spann, I think you hit on that in that funding formula.
And I guess the question would be, at what point do we see
the rate of return to HUD with regard to the participation in
the program as these participants move on? And I guess the best
way to quantify that is, what is the success rate?
I know you talked about having some 923 graduates in your
program, or 938 graduates so far. How does that compare to
those who have not made it? If you were to ratio this, is it a
70 percent success rate, 50 percent, or can you quantify that?
Mr. Spann. It is generally going to be somewhere in the 30
percent rate of success, maybe a little higher than--
Mr. Ross. 30 percent?
Mr. Spann. Around 30 percent.
Mr. Ross. Okay.
Mr. Spann. But again, our program is different from other
programs. So there is no--this sort of comparative thing is
important. It is helpful, however--
Mr. Ross. And do most of them want to help themselves? In
other words, I would think that the first step to success is
wanting to help yourself, and, I guess that could also be an
impediment if they don't. And that would impair your ability to
be successful.
Mr. Spann. I don't think this is really a question of
whether or not individuals and families want to help
themselves. I think every single customer we serve wants to
help himself, herself, or her family. The issue is that life is
happening while they are doing this.
Mr. Ross. Right. And Ms. Riva, I think you mentioned that
that becomes a scenario for Compass. You teach these life
skills. You teach the financial planning. You teach the ability
to see the success of their incremental savings and create the
escrow accounts.
And I am not suggesting that they don't want to be
successful. I understand the outside influences, but it
requires a good coach. It requires a good counselor.
And I guess, Ms. Riva, you mentioned in your testimony
that, ``You should include individualized, client-driven
financial coaching and education to help participants chart and
follow a path, to reach their financeable goals, and become
more financially secure.''
I am hurrying, because I am running out of time here. Is
your program in addition to or greater than what is being
required of FSS?
Ms. Riva. In the Compass model, coaches are essentially
taking the place of coordinators and integrating this coaching-
driven model. But there is no reason why a public housing
authority can't integrate coaching and education. It could be
through community partnerships--
Mr. Ross. And even hereafter, even after they have had
their escrow invested, bought their homes, is their follow up
such as--
Ms. Riva. Yes.
Mr. Ross. --see how that is the important thing.
Ms. Riva. Yes.
Mr. Ross. Okay. Thank you. I see my time has expired, and
now I will recognize Mr. Kihuen for 5 minutes for questioning.
Mr. Kihuen. Thank you, Mr. Chairman, and thank you, Ranking
Member Cleaver. And thank you all for being here to testify and
for being here as witnesses. Just 2 weeks ago, there was an
article published in one of our local newspapers talking about
the success of the Family Self-Sufficiency Program that was run
by the Southern Nevada Housing Authority.
Taquana Edwards is quoted saying that she, ``loves paying
her bills on time,'' which is a sentiment that sounds funny
until you live in a situation where paying bills becomes a
major point of stress.
So I just have two questions, and I think anybody can
answer these. First, why don't more people participate in the
FSS program? And second, do you think that many more people
would participate if agencies and owners had access to
increased funding to hire more coordinators in order to open
enrollment?
Ms. Riva. I would be happy to start answering that
question. So the first question is one of the reasons more
families don't participate is limited coordinator dollars so
that naturally, the FSS Coordinator Grant naturally keeps the
program small.
At Compass, with our public housing authority partners and
our nonprofit housing partners, we have actually leveraged
philanthropic investment to prove that families want to work
and they want to get ahead, which is how we have gotten to
enrollment rates as high as 65 percent at some of the
properties where we are working in partnership with POAH. It's
really important to emphasize that low enrollment rates are not
a reflection of families' desire to move forward.
And then the second thing I would emphasize is the outreach
and marketing in the program is something historically we have
felt could always be strengthened, and to be marketing to
people's hopes and aspirations, not to compliance, and not to
the rules of the program because people are afraid, they are
already afraid.
And so a lot of the work we have done with Compass that we
are sharing with PHAs through our national network is leading
with aspiration and watching how that drives enrollment in the
program.
Mr. Gornstein. Can I just add to that? I think what we have
seen and why we have a higher enrollment rate is the engagement
of our property management staff on the site, the entire team,
not just the property management staff, but the maintenance.
In fact, the maintenance staff have helped in recruitment
of families. Those are the people who are interacting with
these families every single day. They know them best.
And then when you combine that with the financial coaching,
it is very powerful in terms of really trying to recruit
families into the program and then sustaining them going
forward. And I think having some additional funding over time
could certainly help get more organizations more actively
involved and really scale up the program. And that is what we
need to do in the months and years ahead.
Ms. Siglin. And I would like to just add that POAH raised
private funds. They used some retained earnings from other
parts of their rental portfolio and raised private
philanthropic money to pay for the coordinator. Not all
organizations can do that.
So as so many improvements have been made in recent years
in FSS, if we really want to scale it up, you have to look at
the funding. Thank you.
Mr. Kihuen. Thank you, Mr. Chairman. I yield back the
remainder of my time.
Mr. Ross. Thank you. The Chair now recognizes the gentleman
from Michigan, Mr. Trott.
Mr. Trott. Thank you, Mr. Chairman.
I appreciate all of you being here. My research indicates
that the appropriation is about $75 million a year. And just so
I understand the program--and frankly, I don't know a whole lot
about it, so I sure appreciate you being here--is the $75
million largely used for grants for the coordinators and then
also then also to fund the escrow? Anyone can answer my
questions; they are general questions.
Mr. Lubell. It is used entirely to fund the coordinators.
The escrow is funded separately out of the normal subsidy
formula for the three main rental systems programs.
Mr. Trott. Okay. And someone mentioned that roughly 72,000
people a year participate. How many people graduate, would you
say, annually?
Mr. Lubell. It is around 30 percent of program participants
who end up graduating. But I want to emphasize--
Mr. Trott. It is a multi-year--
Mr. Lubell. It is a 5-to 7-year program, so--
Mr. Trott. Right.
Mr. Lubell. --if you looked at any given cohort, roughly 30
percent graduate, but I want to emphasize a couple of things.
One is that even if you don't graduate, people can benefit from
the program because they are getting coaching. They are finding
jobs.
Keep in mind that unlike other programs, if you decide, for
example, to move in with a boyfriend and you are no longer on
public housing, you have to leave the program because you have
to be in subsidized housing.
Mr. Trott. Right.
Mr. Lubell. So some people who don't graduate actually have
positive outcomes today. Some have negative. I don't want to
say this program works for everyone.
Mr. Trott. Right.
Mr. Lubell. And I do think that some emphasis on improving
graduation rates would be good, but that responds to your
questions.
Mr. Trott. Great. And that does respond. Kind of along the
same lines, the benefits of the program, independent of
graduating and getting escrow, someone mentioned, help them
make that leap, I think it was Ms. Siglin?
What is the biggest challenge, if you could each--is it
transportation, housing, increase in salary, life? What would
you say the--
Mr. Spann. I think it is the entirety of it. It is all of
that and then some. We are meeting--so we are a housing
authority. We are housers every single day and so we are
meeting folks where they are to provide that service, and it is
an entire continuum. This isn't--while there are beginning and
end points, it is a continuum that, frankly, has steps.
And I think the rigor of just life itself in addition to
something else is quite a bit. The other part is you have to
remember these are customers who are essentially laying their
souls bare to a confidant.
Mr. Trott. Right.
Mr. Spann. And that is incredibly personal work. Most of
America doesn't do that work. So doing that over a 5-year
period is incredibly difficult. And a 30 percent graduation
rate really is substantial given, frankly, the very small
resource allotment to it.
Mr. Trott. I appreciate that. Thank you.
Ms. Riva, you just told the story about Tanya, I believe,
and her dream to own a home. Have any of you worked with the
private sector in terms of mortgage lenders and to help
facilitate and make that goal more attainable? Is that part of
what you--
Ms. Riva. Absolutely, yes.
Mr. Trott. So they would be clearly independent of this
program--
Ms. Riva. Yes.
Mr. Trott. --but that would be the logical step for some of
these folks, right?
Ms. Riva. Absolutely. And the original statute for FSS
really positions it as a program designed to take advantage of
those partnerships in the community. And so in the markets that
we are in, we are always working with affordable mortgage
providers, building those relationships with banks around their
CRA commitments.
And I just want to mention on graduation, I think it is
important. We are an earlier program at Compass, but we are
tracking closer to 75 percent of our clients are graduating.
And I also wanted to mention the HUD data as among graduates,
36 percent do exit subsidized housing. So I think that it is an
important piece.
Mr. Trott. Yes.
Ms. Riva. Not all families get to that point at the same
moment, and exiting isn't right for everybody at 5 years, but
families are making progress on that path to financial
security.
Mr. Trott. Great.
Ms. Riva. It's just important to point out those statistics
as well.
Mr. Trott. And maybe another dumb question here, but $75
million, how many coordinators are there, if you had to
estimate? And how big is the caseload for a coordinator?
Mr. Lubell. HUD has a standard that the caseload should be
at least 50 per full-time coordinator--
Mr. Trott. Okay.
Mr. Lubell. --although the first coordinator can be 25
because they have other responsibilities like running the
program. Some agencies routinely have higher caseloads and are
trying to be more efficient. And I would say compared with
other programs, this program is pretty efficient in terms of
the number of people who are being served per coordinator.
Mr. Trott. I am almost out of time, so I have to ask one
last question. Any concerns regarding fraud and abuse in the
program, maybe coordinators that really don't have the
families' best interest and any concerns that we should be
focused on to try and improve the integrity of the program?
Mr. Lubell. Not that we are aware. Not that I am aware of.
Mr. Trott. Okay. I am out of time. I yield back, Mr.
Chairman.
And my one other comment is, it would be interesting to
have a coordinator here testifying. That would be a great
addition to the panel. Thank you again for being here.
Mr. Ross. Thank you. And the gentleman yields back.
The Chair now recognizes the gentleman from Texas, Mr.
Gonzalez, for 5 minutes.
Mr. Gonzalez. Thank you, Mr. Chairman.
This is for Mr. Spann. Mr. Spann, in Montgomery County,
Maryland, a person needs to earn more than $33 an hour just to
be able to afford to rent a two-bedroom apartment in that fair
market rate. That means that someone earning minimum wage would
have to work 145 hours a week--more than 3 times the minimum
wage you mentioned in your testimony.
While the average annual earned income of $37,393 by your
clients is a tremendous personal milestone, that is a far cry
from full economic self-sufficiency, especially in an area
where the median income for a family of 4 is $110,304.
Based on this data, it is clear that families need better
job opportunities that pay much more than the minimum wage to
become self-sufficient. How can the FSS program help improve
employment prospects beyond minimum wage positions?
Mr. Spann. Thank you. So further in the testimony and,
frankly, even prior to that, we talk about the actual continuum
itself. And so this is not simply a matter of financial
coaching. This is not simply a matter of finding someone a
minimum wage job.
It also includes a great deal of workforce training in
addition to educational opportunities. And this is about how we
meet a family who is a participant in FSS with the entire
basket of HOC services.
And so for us, that is exactly the mission: How do we close
the gap between that livable wage in Montgomery County and what
some of our graduates are making? And that is the average
number that you are getting. So we do have some graduates who,
frankly, are at a higher level.
But the fact of the matter is, average, many of them are
right there. And so what we have seen in tremendous success is
attaching folks to those educational opportunities that then
help for career advancement, but also allow for career
advancement, offering summer opportunities to not just the high
school students, but those college students of families who are
participants in not just FSS, but all of our programs, and
making sure we have linkages with partners who are committed to
this work.
Many of these folks are working with Compass. We happen not
to be working with Compass. But we have actually found
partnerships throughout the Montgomery County Government and in
the nonprofit sector in Maryland.
And so let me just offer you one of the best testaments of
how successful this program can be, is that this audience is
not filled with participants because they are at work.
Mr. Gonzalez. Fair enough. Thank you very much.
I yield back.
Mr. Ross. The gentleman yields back.
The Chair now recognizes the gentleman from Pennsylvania,
Mr. Rothfus, for 5 minutes.
Mr. Rothfus. Thank you, Mr. Chairman.
My first question is for Ms. Riva. This subcommittee has
been looking at a number of HUD programs and considering their
effectiveness and uniqueness. As I looked at this program, I
wondered whether the goals of FSS could be achieved absent the
program. Could you please talk about whether housing
authorities would be able to deliver the FSS-type services and
outcomes without the program?
Ms. Riva. Thank you for your question. As I mentioned in my
oral testimony, we think what is unique about the bundle that
FSS provides is the combination of affordable housing, one-on-
one support and service coordination for residents, and the
savings account. And where we sit at Compass in the asset
building space is a belief that assets and wealth really matter
in helping families move forward.
So there are other programs and other important programs
that HUD runs that support residents and need to stay in place.
What is unique about FSS is this bundle of promoting work,
promoting savings, and providing support one-on-one to
residents to help them to do that.
It is unique among anti-poverty programs in this Nation and
it is actually the largest asset-building program we have for
low-income families in the United States.
Mr. Rothfus. So is the asset-building part that is unique,
for example, and maybe anybody on the panel can address this,
too? The synergies that this program might have with, for
example, the Moving to Work program, can anybody speak to that?
Mr. Lubell. Yes, I can speak to that. Thank you for your
question. One of the nice things about FSS is that it is open
to all housing authorities. And it is really one of the only
ways to provide a financial incentive for families to increase
their earnings that is available to them. And so that is one of
the important things.
The Moving to Work program gives greater flexibility to
adapt program rules, and there have been a number of agencies
that have taken advantage of that to really experiment with
different approaches including variations on the FSS program.
Cambridge, which is one of the agencies where Ms. Riva
works, has experimented with a different model that they think
can allow them to expand FSS to a much larger group of people
The Portland Housing Authority in Oregon is doing something
similar. So while I think the nice thing about MTW is it gives
the flexibility, but it is only available to a smaller number
of agencies, so FSS is an important thing that is available to
everyone.
Mr. Rothfus. Thank you. And if I could say with--go ahead--
Mr. Gornstein. I was just going to say that we view FSS as
a component in broader program offerings under we call a
Financial Opportunity Center. And that is what we launched in
Independence, Missouri, where you have FSS, you have a college
savings program, you have job training employment, you have
educational programs, various other social services programs,
childcare, and it really helps to get people engaged by having
that financial incentive in FSS.
But they are taking advantage of a broad array of programs.
So we don't view FSS in isolation of the broader array of
offerings and opportunities that may be available for low-
income families.
Mr. Rothfus. If I could go back to Mr. Lubell for a minute,
I want to talk a little bit about self-sufficiency as a goal.
When I speak with public housing advocates, I often ask them
what their metric for success is, and I happen to believe that
self-sufficiency should be the chief metric that we try to
meet, at least for able-bodied adults.
I think that this is the moral approach, and I worry that
we are failing the American people when we create the
conditions that allow multiple generations of a family to
remain in poverty and dependency.
Naturally, a program like FSS seems like it could be an
attractive way to meet this goal of self-sufficiency. Though
the program is still being studied, I understand that it has
already demonstrated some outcomes that are positive on net. If
the program proves effective, should we consider making
participation mandatory for all able-bodied adults?
Mr. Lubell. It is an excellent question, and it is one that
may be difficult to answer in 1 minute as you might expect. But
I would say a few things about that.
First of all, I would agree that there is very strong early
evidence from FSS of success. We just completed an evaluation
that found earnings, gains, and improvements in credit scores,
reductions in debt, and a lot of positive outcomes.
But I should stress that FSS in the way it is set up and
the way it is funded is funded to work with people who
volunteer to be in the program. These are more motivated
people.
So if you were to expand it to other people who are not
necessarily motivated, the question I would ask is, what would
that do to FSS in terms of the number of people who would be
served, in terms of the type of program model that we need to
reach those people?
And I would say that if we made it mandatory and we did not
substantially increase the funding so we could provide
coordinators to deal with the thousands and millions of
additional people who are joining, then we would actually
dilute the effectiveness of the program rather than improve it.
So I would just urge the committee if they are thinking
about that to think about the implications both for the amount
of funding that is really needed to make the program work, but
also the service model.
You might not be able to serve 50 families. You might be
able to serve 20 families with a coordinator, because you are
going to have to work with them a lot more intensely. And so I
would say we just don't have experience with that right now.
What we have experience with is a program that is designed
to help people who want to move ahead get ahead. And we could
serve a lot more people today even with that same model if we
really sort of promoted the program more and provided a little
more money. So I hope that is a helpful answer to your
question.
Mr. Rothfus. That is great.
I yield back. Thank you.
Mr. Trott [presiding]. The gentlewoman from Ohio is
recognized for 5 minutes.
Mrs. Beatty. Thank you, Mr. Chairman, and thank you to our
ranking member, and let me just say to all the panelists today
how much I appreciate you being here, not only for your
expertise in the area, because it is always great to have
people who have actually worked in and lived what we are
talking about versus just speculating on it, but more
importantly than that, this has been a great committee hearing.
It took us a little time to get here, but the interesting thing
is we appear to all be somewhat on the same page, and that is
very comforting when you can sit here and nod your head with
some of the questions on the other side of the aisle.
So I wanted to interject that for the record so we can
remember that when we have other housing programs that come or
maybe we should just bring you all back on whatever the topics
are.
[laughter]
I am a long-time public housing person, some 20 years as a
consultant, and oftentimes we don't give enough attention to
the smaller programs.
But one of the things I can remember from my early years in
working in public housing is we always talked about the
ultimate goal being self-sufficiency or being self-reliant. And
being able to have a program like this is very welcoming
because, certainly, my time in public housing was long before
when President Bush initiated this program.
But I am big on partnerships because, obviously, we aren't
in a position it appears to double the funding that you could
get, but I think you can grow programs and grow your expertise
in a lot of ways.
And so one of the things I was reading, because I am from
Columbus, Ohio, is that our Metropolitan Housing Authority
talked about some of the partnerships with Fifth Third Bank,
with Catholic Social Services, and even Sherwin Williams Paint
stores.
So I guess I wanted, Mr. Spann or Ms. Riva, to get your
opinion about how partnerships would work? Very briefly,
because then I have one other question. Either one of you can
start.
Mr. Spann. Sure. The partnerships are absolutely key, and
for us, this is about us being as an agency a member of a
vibrant, functioning community, and so are the folks we serve.
And as a consequence of that, our partners in other business
for the housing authority are also our partners as we go on to
support folks as they work through the FSS continuum.
So it is incredibly vital to what we do. And the truth of
the matter is we would not be able to connect people
responsibly to housing or a career or even education pathways
without them.
Mrs. Beatty. And don't you think that it is important that
corporate America sees or gets a truer picture of how
individuals who live in public housing might be economically
deprived, but it doesn't mean that they are challenged
academically or in the world of work if given an opportunity?
I am going to take your nod as a ``yes,'' and I am going to
go to the next question for anyone to answer. We talked a lot
about outcomes and metrics and how we can be more accountable.
And I am in full support of that because the ultimate goal I
think that you have is the same as it is for me.
So can anyone tell me how you are evaluating the outcomes?
I have read some of the studies. That study that talks about
credit rate, scores going up, talking about savings going up.
Is that the only one, or are there other ways that you
monitor, evaluate? Because that is what my colleagues are going
to ask me when we start talking about this program and others.
How do you prove that it is working?
Ms. Riva. I am happy--
Mrs. Beatty. You get 10 seconds apiece if everybody--
Ms. Riva. Yes, so 10 seconds for Compass. So we are--our
discipline around data collection we think it is really
important in doing this work. And we look at our outcomes
across five main measures, changes in earnings, changes in
credit score. And debt credit is a tool that is a piece of
economic mobility.
Access to quality financial products, which is where banks
are coming in, increases in savings, and then a fifth is a
qualitative measure which is people's overall sense of
confidence and well-being. It really matters to keep marching
forward on that path to economic opportunity.
That is how we do it at Compass. I think historically, at
HUD, outcomes have focused primarily around graduation, home
ownership rate, and exit rates. And in the last year or two,
working particularly with Abt, HUD is looking at and
introducing stronger performance-based measures, which we are
excited about and think will also help to improve the program.
Mrs. Beatty. Thank you.
Mr. Trott. The gentleman from Missouri, Mr. Luetkemeyer, is
recognized for 5 minutes.
Mr. Luetkemeyer. Thank you, Mr. Chairman.
Just a few quick questions here. How do the individuals
qualify for the program? Do they come to you? Do you recruit
them? Put an ad in the newspaper? Do the folks who manage the
facilities go down the road and knock on doors? Or how does
this all work?
Mr. Spann. It is sort of a ``yes-and'' for us.
Mr. Luetkemeyer. I'm sorry?
Mr. Spann. Yes, and more.
Mr. Luetkemeyer. Okay.
Mr. Spann. Absolutely it is. So it is voluntary. The
program is voluntary.
Mr. Luetkemeyer. Right.
Mr. Spann. So persons are choosing to be a part of it. They
are doing so--
Mr. Luetkemeyer. Do you sort of pre-screen them, though,
when somebody comes in and say, hey, I heard about this great
program. I would like to try and qualify for it. And you sit
down and you work through an application on it? And do some
people not qualify?
Mr. Spann. What we work through is an assessment.
Mr. Luetkemeyer. Okay, an assessment.
Mr. Spann. And so that assessment is really to determine
where people are in their own journey. But are folks
disqualified as a consequence of something other than being out
of compliance in another program? No.
If an individual is out of compliance in, say, the voucher
program or the public housing program, then certainly it is
possible that person might not be able to participate. However,
generally you won't have persons who are out of compliance
volunteering themselves.
Mr. Luetkemeyer. Okay.
Mr. Gornstein. We also do a combination of one-on-one
outreach with each of our residents, group workshops,
information sessions. When people move in we go over the
importance of the program and hope that they consider it. So at
all different touch points, recertification, all--
Mr. Luetkemeyer. When do you recertify, once a year?
Mr. Gornstein. Yes.
Mr. Luetkemeyer. Okay. What happens if an individual--you
said they just moved in, what happens if the person moves away?
Are they able to keep this program? Does it follow them or do
they have to move to a facility that has a coordinator?
Mr. Gornstein. As long as they are in compliance with the
program they can take their escrow amount with them. And if
they move into another assisted property or public housing
where there is an FSS program they can continue it there. I
believe that is the case. If you want to clarify that?
Mr. Lubell. Yes, it is more or less correct, but if they
leave subsidized housing they are no longer in the program. And
that is one of the things that is tied to being in the program
and people do leave subsidized housing for a range of reasons.
Mr. Luetkemeyer. Right, but if they went to another
facility that they would qualify for they could--
Mr. Lubell. Yes.
Mr. Luetkemeyer. --continue the program and they--
Mr. Lubell. They could continue.
Mr. Luetkemeyer. As long as that facility had a
coordinator, I assume? Or the coordinator from the past
facility would be eligible or able to take them on and continue
with them if they move from different cities, right, for
instance?
Ms. Siglin. One of the things that has happened with the
recent expansion of FSS to project-based rental assistance is
public housing projects are converting under the RAD program to
become project-based Section 8. So when that happens, the
residents are protected now that FSS has been temporarily
expanded to project-based. So the resident who is accumulating
escrow in public housing can continue to do so.
Mr. Luetkemeyer. If you look at the recent flooding, you
have people who perhaps were in a situation where their
facility was flooded out and they have to go someplace else.
So, my question is, if those folks could continue on in some
other facility?
Is there some sort of oversight or accountability for the
funds, the $75 million roughly? Do you have an auditor come in
and double-check to make sure that whomever you are designating
as the coordinator, that they are doing their job? What sort of
oversight is there?
Mr. Gornstein. We are self-funding the program and so we
are not eligible for the coordinator funds. So we are not being
audited in that sense from HUD. However--
Mr. Luetkemeyer. So you have your own self-coordinated
funder, or self-funded coordinator?
Mr. Gornstein. Self-funded, correct. However, we have plans
of actions approved by HUD and then we have regular reporting
to HUD with regard to each family and the escrow accounts. So
there is significant oversight by HUD, even though we are not
getting direct funding from them.
Mr. Luetkemeyer. How often do you report to them, once a
month, once a quarter, once a year?
Mr. Gornstein. I believe it is quarterly.
Mr. Lubell. Yes. And HUD is also in the process of adopting
a performance measurement system, so all housing authority FSS
programs that are funded by HUD will be assessed on a series of
metrics. That is what we do--
Mr. Luetkemeyer. Is that a cost-benefit analysis? Is that
what you are talking about?
Mr. Lubell. I'm sorry?
Mr. Luetkemeyer. Is it a cost-benefit analysis?
Mr. Lubell. No. It is an analysis that looks at outcomes.
It looks at the extent to which families' earnings have gone up
relative to other families in the same housing authority.
Mr. Luetkemeyer. Okay.
Mr. Lubell. It looks at the graduation rate and it looks at
the number of people who are being served.
Mr. Luetkemeyer. So a while ago when you were in your
opening statement, or maybe you were responding to somebody
else here, you made a statement that because the program hasn't
been in place long enough and you haven't had a baseline to
compare against, you are not sure how effective it is.
But it would appear that you are doing great, I would
assume? That is your conclusion that--
Mr. Lubell. Who is doing great? I'm sorry?
Mr. Luetkemeyer. The folks involved in the program--there
seems to be a substantial graduation rate from it, which is
great, but there--you made a comment I think to the effect that
you didn't have a baseline to compare or a control group--
Mr. Lubell. Oh, I'm sorry.
Mr. Luetkemeyer. --to compare against. Is that--
Mr. Lubell. Yes. Let me clarify.
Mr. Luetkemeyer. And maybe I am not--
Mr. Lubell. I apologize if I was--the program has been
around for 25 years, so we have a lot of data.
Mr. Luetkemeyer. Right.
Mr. Lubell. And the issue was that the particular
evaluation--HUD's first two program evaluations tracked
families over time, but they did not have a comparison group to
compare them to and therefore were not able to make a
definitive statement about the impact of a program.
The most recent study that we did of Compass, for example,
did have a comparison group. We were able to compare the
outcomes against the comparison group and therefore be able to
say something meaningful about the program's positive impact.
Mr. Luetkemeyer. My time has expired. I yield back.
Mr. Trott. Thank you. The gentleman yields back.
The Chair now recognizes the gentleman from Missouri, Mr.
Cleaver, for 5 minutes.
Mr. Cleaver. Thank you. Let me first of all, again, thank
all of you for being here.
Mr. Spann, we did try to get two of your residents to be
here today, but we were delighted that they could not come
because they couldn't take off work.
And let me also just say, as a former resident of public
housing, and as a mayor who appointed the housing authority and
had oversight of it, and Independence is in my district, as is
Marshall and Kansas City where this program has worked, this is
a good program and it is working well.
One of my regrets is that we want this program and other
things like it to be incentives to the residents, but it also
ought to be an incentive for us to invest more money in the
program.
You hear a lot about programs that don't work, but I have
not heard a single Member here today make a negative comment
about the workability of this program. I have experientially
seen it work.
All of you have, and my hope, my goal, would be to somehow
convince this committee and maybe even the Secretary that when
we have a program like this introduced by somebody who was from
a different party than me, I could care less whether he was a
member of the Oakland Raiders. All I want is a program to work.
And this is working, and I am going to support it and give
President Bush the credit for the wisdom for putting it in
place.
Now, one of the things that I would--I had a lot of
questions that I wanted to ask you, and some of them I already
knew the answer to, but I wanted to get you on record. But
somebody was asked a question about fraud and abuse, and we
are, obviously--I guess we are the oversight committee so
people we are supposed to be concerned about that.
But to my knowledge, as of today at 10 minutes after 4:00,
that has not been, there has not been any Federal investigation
or charge against the program for any kind of fraud or abuse.
Am I wrong?
Mr. Lubell. I don't think any of us are aware of any such
investigation, sir.
Mr. Cleaver. Yes. I know the answer, but the point I am
trying to make is why in the world don't we celebrate this
program by saying, look, if we can get 30 or 35 percent success
and invest more money to bring it up to 60 percent, why not do
it and just sing hallelujah or whatever you sing at church?
But this is a program to celebrate. And I am hoping that
all of you feel good about the fact that that it has been
successful and you played a role.
Somebody mentioned the Fatherhood Initiative. Mr. Spann,
can you just go into a little detail on that, please?
Mr. Spann. Certainly. The Department of Health and Human
Services has a father initiative, a grant. We are maybe one of
two housing authorities to apply for and receive that funding,
and what we have decided to do is include it in our suite of
HOC Academy and resident services, along with partnering with
the FSS program so that there are fathers who are identified
and supported.
And again, we are matching them as quickly and as
deliberately as we can to workforce opportunities, to workforce
readiness opportunities, educational opportunities and the like
so that we have fathers supported in our community who are
present in their children's lives and active and so forth.
Mr. Cleaver. Let me close out by saying I would argue that
the success numbers are higher than what we officially report.
And the reason for this is that proximity breeds imitation.
Somebody in a neighborhood that is rundown paints their
home, and you look up the next Saturday and people down the
street are painting their home. The same thing happens in
public housing. I saw it. I know what happens.
Or somebody decides to get married. We don't consider that
a success, in spite of the fact that they get married, they go
on and have a successful marriage and raise children and work
and so forth. So I think the success rate is actually higher
than we report, than the data would report.
So let me thank you all very much for your testimony, and I
appreciate the fact that our Chair put this on the agenda.
Mr. Trott. The gentleman's time has expired.
I don't believe there are any more Members who have
questions, and we have a vote series coming up shortly, so I
think that is part of the reason. But I want to thank everyone
again for being here.
And I have to agree with Mrs. Beatty. I believe that this
hearing has been particularly productive and informative. And I
also want to thank all of you for everything you do in your
communities. You clearly make a big difference, and we
appreciate it.
The Chair notes that some Members may have additional
questions for this panel, which they may wish to submit in
writing. Without objection, the hearing record will remain open
for 5 legislative days for Members to submit written questions
to these witnesses and to place their responses in the record.
Also, without objection, Members will have 5 legislative days
to submit extraneous materials to the Chair for inclusion in
the record.
Without objection, this hearing is adjourned.
[Whereupon, at 4:18 p.m., the hearing was adjourned.]
A P P E N D I X
September 27, 2017
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