[Congressional Record (Bound Edition), Volume 160 (2014), Part 11]
[Senate]
[Pages 15545-15547]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          NOMINATION OBJECTION

  Mr. GRASSLEY. Mr. President, I intend to object to consideration of 
the nomination of Lourdes Castro Ramirez to be the Assistant Secretary 
of the Department of Housing and Urban Development, HUD, for the Office 
of Public and Indian Housing.
  Over the last 4 years, I have been raising concerns about serious 
problems at public housing authorities and HUD's failure to address 
them. The Office of Public and Indian Housing is responsible for 
overseeing the public housing authority program.
  I recently learned that HUD is negotiating new, 10-year contracts 
with the 39 housing authorities participating in the Moving to Work, 
MTW, demonstration program. The Office of Public and Indian Housing is 
also responsible for administering this program but has failed to 
conduct proper oversight for years.
  The current contracts don't expire until 2018 so there is no need to 
rush into signing new contracts. Instead, I recommend HUD takes serious 
steps to address the program deficiencies and determine if this 
demonstration should continue.
  A group of housing advocacy organizations sent a letter to HUD on 
November 7, 2014, raising concerns about the lack of transparency in 
the MTW contract negotiations. I am requesting that a copy of this 
letter be included with my statement in the Record. These organizations 
represent the people directly impacted by HUD decisions. They are 
asking questions that would strengthen the program and protect funding 
from abuse. But HUD is blocking them from participating in the process. 
Only the MTW agencies are allowed to review the contracts and comment 
on the proposed changes.
  According to HUD briefing materials, the MTW housing authorities 
operate about 14 percent of the Nation's housing stock and receive over 
$3 billion in funding per year, equal to about 20 percent of total 
program funding. Yet HUD has failed to require any meaningful 
accountability or transparency.
  This has led to financial abuses at the Chicago Housing Authority and 
other MTW housing authorities. On October 23, I sent a letter to HUD 
about the Chicago Housing Authority (CHA), a Moving to Work 
participant. CHA has diverted approximately $432 million in Federal 
funding into a reserve fund instead of issuing over 13,500 vouchers to 
Chicago families who need affordable housing assistance.
  For example, the Atlanta Housing Authority has at least 20 employees 
receiving annual compensation ranging between $150,000 and $300,000 per 
year. The executive director explained that these high salaries are 
necessary ``to both `attract and retain' competent staff.''
  The executive director of the Philadelphia Housing Authority also 
received a high salary over $300,000 per year. He also threw lavish 
parties, provided patronage to friends and supporters, and secretly 
paid sexual harassment claims.
  Instead of providing safe, affordable housing for those in need, 
housing authority officials are using Federal funding to feather their 
own nests. HUD tells me these problems are anomalies, which lead me to 
believe the Department may be turning a blind eye to program failures 
no matter what the costs.
  Both the HUD inspector general and the Government Accountability 
Office, or GAO, audited the MTW program. Both determined that little 
program oversight is actually being done. HUD has no procedures to 
verify agency self-

[[Page 15546]]

reported performance data and HUD officials weren't even aware that 
they were required to perform annual risk assessments. HUD also has no 
program-wide performance indicators that would help determine if this 
program is a success or failure.
  Worse yet, HUD never performed mandatory program evaluations to 
determine if the agencies complied with their MTW agreements or whether 
they should still be in the program. Department officials said they 
lack the funding to performing the evaluations. Under the current 
budget climate, additional funding may not be available anytime soon. 
In other words, HUD can't tell me if the Moving to Work program 
actually works or if it will work in the future.
  GAO officials informed me that the agency may be close to closing 
three recommendations. For the other five recommendations, they are 
waiting for HUD to provide additional documentation about what steps 
are being taken or what is needed to close each of them. Instead of 
taking steps to improve program performance and provide more effective 
oversight, the Agency is, instead, rushing to extend contracts for an 
additional ten years.
  I expect a lot more answers and accountability before there is a vote 
on Ms. Castro Ramirez's nomination. HUD must also refrain from adding 
new housing authorities to the MTW program until the agency provides 
GAO with the requested information and a definitive timeline for 
closing the outstanding recommendations.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                 November 7, 2014.
     Hon. Julian Castro,
     Secretary, U.S. Department of Housing and Urban Development, 
         Washington, DC.
       Dear Secretary Castro: We represent housing advocates who 
     work with clients and community members in the jurisdictions 
     of public housing agencies (PHAs) that have Moving to Work 
     (MTW) status. We look forward to working with you to further 
     HUD's mission to create strong, sustainable, inclusive 
     communities and quality affordable homes for all.
       We are writing to ask HUD to take immediate action to 
     create a more open, inclusive, and transparent process as HUD 
     negotiates the terms for any potential extensions to Moving 
     to Work Agreements past their current 2018 expiration. 
     Consistent with the statutory language creating the MTW 
     program, we specifically request that HUD consult with 
     advocates during the contract negotiations. Indeed, Congress 
     was clear that ``in making assessments throughout the 
     demonstration, the Secretary shall consult with 
     representatives of public housing agencies and residents.'' 
     As a first step, we urge HUD to make the baseline language it 
     is crafting for MTW extension contracts available for public 
     comment and discussion, and solicit and consider input from 
     resident and community advocates on the conditions for 
     extensions and the terms of the extension agreements.
       As you undoubtedly know, HUD's MTW demonstration is steeped 
     in controversy. In addition to receiving criticism from 
     advocacy agencies providing services to PHA residents in 
     deregulated jurisdictions, HUD's own Office of the Inspector 
     General and the U.S. Government Accountability Office have 
     released studies critical of the MTW program's underlying 
     structure and HUD's implementation and oversight of the 
     program, including the GAO's 2012 Evaluation and the HUD IG's 
     2013 Study. These studies indicate that the Moving to Work 
     program lacks performance standards and evaluation, and HUD 
     has not provided critical oversight to agencies participating 
     in the MTW program to evaluate agencies' compliance with 
     statutory requirements or verify agencies' self-reported 
     performance data.
       Based on these pervasive critiques, we believe that any 
     extension of the MTW demonstration must be done with 
     thoughtfulness, diligence, and open discussion of the lessons 
     learned from HUD's previous experiments in deregulation, 
     which simply have not demonstrated any of the programmatic 
     results this venture was designed to achieve.
       The current MTW Agreements do not expire until 2018. We 
     understand that HUD's stated goal for beginning MTW extension 
     discussions in 2014 has been to develop better tools and 
     standards to enable more effective regulation and oversight 
     of MTW Agencies moving forward. We support any process that 
     will ensure that new language in MTW contracts will provide 
     clear metrics for performance, clear processes for 
     evaluation, and clear protocols for HUD to monitor and 
     enforce Agencies' compliance with statutory requirements and 
     standards, even amidst the flexibility the MTW program 
     intentionally allows.
       We strongly support some goals HUD has put forward for the 
     extensions, including establishing requirements that agencies 
     use the bulk of their voucher funds for vouchers, higher 
     baselines to determine if agencies are assisting 
     ``substantially the same'' number of families, and more 
     rigorous evaluation of policies that pose risks to 
     participants. Effective requirements in these areas would 
     have major benefits for low-income families. Without more 
     information on the details, however, it is impossible for us 
     to assess whether the changes HUD plans will bring about 
     meaningful improvements.
       As advocacy organizations who work with tenants who are the 
     ``end-users'' of HUD's programs in regions de-regulated under 
     the MTW program, we believe we have experiences and 
     observations that can help contribute to HUD's success in 
     amending the program.
       We have documented concerns with the current MTW Agreements 
     that are not adequately addressed by the limited information 
     HUD has released about the planned extensions. These concerns 
     include but are not limited to:
       How new MTW Agreements will prevent de-regulated PHAs from 
     diverting significant resources out of their housing programs 
     into unrestricted cash reserves or towards other questionable 
     uses such as excessive executive compensation. These actions 
     clearly contradict MTW's statutory goal to, ``reduce cost and 
     achieve greater cost effectiveness.'' The agreements should, 
     for example, include clear limits on reserve levels and 
     specific sanctions for agencies that exceed those limits.
       How HUD will evaluate the real effects of proposed or 
     existing major policy changes allowed under MTW, such as time 
     limits, work requirements, and major rent changes, to assess 
     whether these changes are achieving the program's statutory 
     goals of helping families achieve economic self-sufficiency 
     and increasing housing choice, or instead just creating a 
     revolving door of homelessness and hardship. HUD has 
     indicated that it will require more rigorous evaluation of 
     some new policies, but it should also seek to evaluate 
     policies already in place and should make clear that it will 
     prohibit agencies from adopting risky measures like time 
     limits and work requirements unless funding for a rigorous 
     evaluation is available.
       How HUD will define, monitor, and enforce, the new standard 
     of 90% voucher utilization, both before and after new MTW 
     agreements go into effect. This standard will be far more 
     effective if HUD uses the voucher funding formula to enforce 
     it, and if it prohibits agencies from counting funds spent 
     for purposes other than rental assistance toward voucher 
     utilization.
       How HUD will define and enforce the requirement to assist 
     substantially the same number of families. HUD has indicated 
     that it will adjust the baseline number of families agencies 
     must assist upward, but unless HUD also defines ``assisted 
     families'' to include only families receiving substantial 
     rental assistance this requirement will have little meaning.
       How HUD will ensure appropriate hardship exemptions are in 
     place.
       How HUD will ensure MTWA jurisdictions increase housing 
     choices and mobility to opportunity communities among program 
     participants.
       Thank you for considering this request.
       Through a collaborative, thoughtful, transparent and 
     inclusive approach, we are confident that we can work with 
     HUD and participating public housing agencies to create 
     targeted revisions to the MTW program which clarify 
     performance metrics, and create clear processes for 
     evaluation and oversight. Our goal is to create a structure 
     that provides both flexibility and discipline--A well-
     considered framework for any continuation of the program will 
     better ensure we realize the original goals of the MTW 
     program, which were to expand housing choice, increase cost 
     effectiveness, and help families achieve self-sufficiency.
       Congratulations on your confirmation as HUD Secretary.
           Sincerely,
         Asian Americans Advancing Justice--Asian Law Center, San 
           Francisco Bay Area, California, Christina Dang and 
           Thomas Lee, Staff Attorneys; Atlanta Legal Aid Society, 
           Inc., Atlanta, Georgia, Margaret L. Kinnear; Cabrini 
           Green Legal Aid Clinic, Chicago, IL, Jill Roberts and 
           Ryann Moran, Staff Attorneys; Center for Tax and Budget 
           Accountability, Ralph Martire, Executive Director; 
           Chicago Housing Initiative, Chicago, IL, Leah Levinger, 
           Executive Director; Community Alliance of Tenants, 
           State of Oregon, Steve Weiss, Board President; 
           Community Legal Services, Philadelphia, Pennsylvania, 
           Rasheedah Phillips, Housing Law Division.
         Delaware Housing Coalition, State of Delaware, Trish 
           Kelleher, Director of Housing; Housing Action Illinois, 
           State of Illinois, Bob Palmer, Policy Director; Jane 
           Addams Senior Caucus, Chicago, IL, Lori Clark, 
           Executive Director; Law Foundation of Silicon Valley, 
           San Jose, California, Nadia Aziz, Senior Attorney; 
           Legal Aid Society of San Mateo County, San Mateo 
           County, California, Shirley E. Gibson, Directing

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           Attorney; Legal Assistance Foundation, Chicago, IL, 
           Lawrence Wood, Housing Practice Group Director; Logan 
           Square Neighborhood Association, Chicago, IL, John 
           McDermott, Housing & Land Use Director.
         Lugenia Burns Hope Center, Chicago, IL, Rod Wilson, 
           Executive Director; Massachusetts Alliance of HUD 
           Tenants, State of Massachusetts, Michael Kane, 
           Executive Director; Metropolitan Housing Coalition, 
           Louisville, Kentucky, Cathy Hinko, Executive Director; 
           Metropolitan Tenants Organization, Chicago, IL, John 
           Bartlett, Executive Director. Mid-Minnesota Legal Aid, 
           Minneapolis, MN, Dorinda L. Wider; National Alliance of 
           HUD Tenants, National, Charlotte Delgado, Board 
           President.
         National Housing Law Project, National, Deborah Thrope, 
           Staff Attorney; North Carolina Justice Center, State of 
           North Carolina, Bill Rowe, General Counsel and Director 
           of Advocacy; Northwestern University School of Law, 
           Chicago, IL, John S. Elson, Professor of Law; 
           Organizing Neighborhoods for Equality, Chicago, IL, 
           Jennifer Ritter, Executive Director; People for 
           Community Recovery, Chicago, IL, Cheryl Johnson, 
           Executive Director; Sargent Shriver National Center on 
           Poverty Law, Chicago, IL, Kate Walz, Director of 
           Housing Justice; Tenants Union of Washington State, 
           State of Washington, Jonathan Grant, Executive 
           Director.

                          ____________________