From the August American Planning Association Domestic Policy Watch
Written by:
W. Paul Farmer, FAICP
APA Executive Director
HOPE for Federal Housing Policy?
Housing Choice and Affordability. That's APA's "supertopic" for the next two years, following Safe Growth, our inaugural supertopic. You can expect to see articles in all of our print media, such as Planning, Zoning Practice, and Planning & Environmental Law. You will have the opportunity to read more online in Practicing Planner and PAS Memo. Today, we'll look at the federal policy issues in this edition of Domestic Policy Watch.
As a nation, we pride ourselves on our rate of home ownership, our housing quality, and for most, the housing choices available to us. Earlier this year, APA's Planners Press published a remarkable book, Tomorrow's Cities, Tomorrow's Suburbs, that explores data and challenges many of our long-held beliefs about housing values and community safety. As just one example, consider that your chances of dying a violent death (by auto accident or homicide by a stranger) are lowest in cities and highest in exurban/rural areas. Also consider that pre-1940s housing has held its value more than 1960s housing. These are fact-based conclusions that most Americans would find surprising. The authors use their analyses to look ahead.
Now, let's look at both present and future domestic policy for affordable housing and community revitalization.
It is an understatement to say that federal affordable housing and community revitalization programs have not fared well in recent years. As local demand for these initiatives has increased, Washington has responded, ironically enough, with fewer resources and a series of administrative changes intended to shift ever-greater burdens to municipalities.
It has become an annual rite of spring for the U.S. Department of Housing and Urban Development to send a budget request to Capitol Hill that slashes or outright eliminates programs designed to help communities with the real and daunting challenges associated with providing affordable housing and bolstering struggling neighborhoods. For some reason, HUD's leadership seems most committed to undermining its own mission.
These annual efforts have been partially forestalled by Congress, but many programs have simply limped along on congressional life support. For most of this year, things in Washington progressed pretty much according to this script. HUD asked Congress to eliminate HOPE VI, cut the Community Development Block Grant program, and "consolidate" the Brownfields Economic Development Initiative and Section 108 loan guarantees into CDBG. Meanwhile, HUD suggested changes in the CDBG formula that would prevent more than 300 cities from receiving support.
However, just before Congress left town for the August recess, some senators began deviating from the script. Is this an election season conversion or a principled stand? Hard to say, but their action may signal an important, and welcome, shift in congressional interest in helping improve neighborhoods and communities back home.
At the end of July, a united, bipartisan Senate Appropriations Committee gave approval to the FY 2007 appropriations bill for Transportation, Treasury, the Judiciary and Housing and Urban Development (TTHUD). As Sen. Patty Murray (D-Wash.) said, "In nearly every case, this bill restores the punitive funding cuts that the President requested." Among the bill's highlights are $1.2 billion more for CDBG than HUD wanted, a $500 million increase for Section 8 rental vouchers, and $100 million for HOPE VI.
Let me be clear: these "increases" don't begin to reverse years of bipartisan fiscal neglect, but perhaps the action does suggest a change in direction. Of course, the work of a single committee does not call for popping champagne corks just yet. Not only does the full Senate have to act, but Senate action must be reconciled with the House-approved version of the bill.
As tenuous as this progress may be, let's hope that it portends a rediscovery of the community development component of HUD's mission. Dealing effectively with affordable housing means dealing seriously with the task of creating communities of lasting value. Yet the few HUD initiatives that support neighborhood revitalization have most often been the target of the deepest cuts or outright elimination.
The saga of HOPE VI is an instructive example. In 1989, Congress established the National Commission on Severely Distressed Public Housing. After three years of investigation, the commission reported to Congress that at least 86,000 public housing units were "severely distressed." Congress responded with a program whose intent was more than capital improvements of dilapidated housing projects. The HOPE VI initiative was crafted by Congress to help communities turn neglected concentrations of poverty into vibrant mixed-income communities, while providing for coordinated services to public housing residents. Congress set the ambitious goal of building "sustainable communities" into the original HOPE VI legislation. (Remember the 1949 goal of "a decent home for all Americans"? It's still on the books as our national commitment.)
HOPE VI, along with CDBG, is basically the only federal source of redevelopment funding. Many communities have had considerable success using these funds as part of larger efforts to improve quality of life and the economies of struggling neighborhoods. Many of APA's members have worked tirelessly on these successes, from HUD staffers to local planners and consultants.
According to a 2004 report by the Urban Institute, HOPE VI funding has helped 166 cities rehabilitate public housing. The same report notes that HOPE VI has leveraged billions of dollars in other public, private, and philanthropic investment. The report, while identifying important issues with implementation, also found that HOPE VI "achieved substantial success" in replacing "some of the most distressed and destructive housing environments" with "higher quality housing and, in many cases, mixed-income communities." The result? Higher quality of life and safer neighborhoods for residents.
The Urban Institute findings were reinforced by a study conducted by the Brookings Institution. Researchers looked at HOPE VI results across the nation. Among the documented findings:
* In Atlanta, median income in the HOPE VI financed Centennial Place redevelopment rose 174 percent compared with increases of 16 percent and seven percent, respectively, for the city and metro areas;
* In St. Louis, one of the poorest neighborhoods in the city has seen new residential, commercial, and retail growth spurred by the Murphy Park project;
* In Louisville, the new Park DuValle has had an 82 percent drop in crime since HOPE VI funded redevelopment.
This does not mean the program is perfect. There are legitimate worries about ensuring that affected residents are not displaced. That's why Congress made a series of improvements when HOPE VI was initially reauthorized in 2003. That authorization added new protections for tenants, including strengthening their role in the planning process. The program also was expanded to provide assistance to smaller communities.
The current authorization for HOPE VI expires this year. Bipartisan legislation has been introduced in the House and Senate to extend and continue improving the program. Of course, this effort faces the continuing desire by HUD to eliminate one of the only major sources of federal assistance for redevelopment.
In fact, a look at the recent history of HOPE VI provides an instructive view on the efforts of the administration to systematically reduce the federal role in affordable housing and neighborhood revitalization. For three consecutive years, HUD has asked Congress to eliminate all funding for HOPE VI. Last year, the agency went even further. What's less than zero funding, you ask? The budget request sent to Congress sought to rescind $99 million from last year's approved funding.
The bipartisan support for HOPE VI has emboldened leaders on Capitol Hill to reject the plan to eliminate funding. However, with the program out of favor in the administration, it has become an easy target for big cuts in tight domestic discretionary budgets. Prior to FY 2004, HOPE VI was funded at $570 million. In each subsequent year, funding fell — to $100 million in FY 2006. For the last two years, funding in the House appropriations bill had to be added in a last minute floor amendment. Of course, the declining amount for HOPE VI has not been replaced by increased spending for other HUD revitalization programs like CDBG.
The story is depressingly similar for CDBG. The administration proposes funding cuts and then elimination of funding altogether. Congress rejects a radical dismantling of federal investment in our nation's cities, towns, and neighborhoods but instead approves a steady erosion in core funding.
For CDBG, the stage is set for a new front in this battle next year. Having been rebuffed by Congress in its attempt to roll CDBG and several other programs into a new "Strengthening America's Communities Initiative," the administration now proposes to simply redefine CDBG from the inside to achieve most of the initiative's original objectives.
HUD has already laid the groundwork for this change by releasing suggested changes to the CDBG formula and program composition. At its core, the proposal would move funding to a need-based system with less emphasis on maintaining a reliable source of funding to leverage additional local investment. The proposal would also weaken certain planning requirements and provide far less money overall. Congress does not seem inclined to take up the proposal in the few weeks remaining before Election Day, but you can be sure that the language will be pushed again in next year's HUD budget proposal.
As with HOPE VI, CDBG is not perfect. Both programs need to be updated and improved. APA would welcome the chance to work with HUD, Congress, and other stakeholder organizations on finding the best ways to modify the programs, using the lessons learned in communities.
Bipartisan conversations are happening with some interested leaders on Capitol Hill, like Rep. Mike Turner (R-Ohio) and Sen. Jack Reed (D-R.I.). However, the unfortunate reality is that most time and energy is spent on simply keeping vital programs alive. The need is too great to allow federal investment to just disappear. I hope that you've been reading a fine series of articles in Planning, "Overlooked America." Recent articles have examined teen homelessness, day laborers, and others who have yet to achieve the American Dream.
APA has embarked on this two-year special focus on Housing Choice and Affordability. Part of this effort will mean redoubling our efforts in support of vital federal housing and neighborhood revitalization programs. In addition, we will continue the conversation with our members, our allies, and policymakers about how to improve these programs and what the next generation of federal policy should look like.
Despite recent years' dreary record in Washington, I think there is cause for hope. Maybe that unanimous voice vote a few weeks ago in the Senate Appropriations Committee means more than just continuing funding for some good programs. Maybe it is a harbinger that Congress wants to get serious about supporting local efforts at improving communities.
If that's the case, I hope lawmakers will come back from their August break and not only approve funding for HOPE VI but also pass legislation reauthorizing the program. For a year, bipartisan bills in the Senate and House have languished without action. Just days after the Senate Appropriations Committee vote, the House Financial Services Committee sent a HOPE VI reauthorization bill to the full House. So, the opportunity is there. We'll be watching and encouraging. So will, I suspect, voters back home — voters from all parties. If you have ideas, let us hear from you.