Tag Archives: Department of Housing and Urban Development

Preserving Affordable Housing

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photo by Rgkleit

Alexander von Hoffman of the Harvard Joint Center for Housing Studies has posted an interesting working paper, To Preserve Affordable Housing in the United States. It opens,

Most Americans who have any idea about low-income housing policy in the United States think of it as composed of programs that either build and manage residences – such as public housing – or help pay the rent – such as rental vouchers. Few people realize that much, perhaps most, of the government’s effort to house poor families and individuals is now devoted to supporting privately owned buildings that, courtesy of government subsidies, already provide low-income housing. Similarly, few know of the national movement to prevent these rental homes from being converted to market-rate housing or demolished and to keep them affordable and available to low-income households.

The problem of “preservation of affordable housing” generally refers to privately owned but government-subsidized dwellings developed under a particular set of federal subsidy programs. Although the first of these programs was enacted in 1959, their heyday – when they produced the bulk of government-subsidized low-income housing – lasted from the late 1960s until the mid-1980s. Before these programs were adopted, the government’s chief low-income housing program had been public housing, in which government agencies funded, developed, owned, leased, and managed apartments for people of limited incomes on a permanent basis.

Starting about 1960, however, the government shifted to a new policy in which it provided subsidies limited to a specific length of time to private developers of low-income rental housing. These private developers could be nonprofit organizations or for-profit companies operating through entities that earned limited dividends. In the low-income rental programs of the 1960s the government subsidized the rents of poor tenants by providing low-interest mortgage loans (through mortgage insurance and/or direct payments) to the projects’ developers. In 1974, Congress added another program, Section 8, in which the government signed a contract to pay a portion of the tenants’ rents for up to twenty years, which was as long as the mortgage subsidies had been.

After the low-income rental projects were completed, a number of circumstances threatened to displace the projects’ low-income occupants from their homes. In the early years especially, some owners faced financial difficulties, including foreclosures. Starting in the boom years of the 1980s, others desired to pay back their subsidized mortgages early (or “prepay”) to rent or sell the apartments at lucrative market rates. And eventually all owners reached the end of the time limit of their original subsidies. To keep low-income tenants in the subsidized apartments, housing advocates fought to keep the subsidized projects livable and within the means of poor people. The cause they rallied to was the “preservation of affordable housing.”

*    *    *

Since the late 1980s a wide array of interests – including for-profit owners and investors, non-profit developers and managers, and tenants – have organized their interest-group associations and entered into coalitions with one another to shape government policies. They have worked with sympathetic members of Congress and their aides to preserve the subsidized housing stock for low-income Americans. The road has been rough at times. The Reagan administration was indifferent at best to the issue. Legislation in 1987 and 1990 for all practical purposes banned prepayments, angering the owners’ representatives who opposed these laws. After prepayments were again allowed, advocates and owners joined together again to push for affordable housing preservation programs and procedures. The government programs that they attained in the 1990s became a major component of low-income housing policy in the United States.

Until relatively recently, the interest groups focused on shaping federal policy. They worked to pass – or repeal – national legislation and to influence program rules set by the Department of Housing and Urban Development (HUD). Although the federal government continues to be essential to housing policy, the growing political opposition to large federal spending programs has led advocates of affordable housing preservation to press state governments for financial support. (3-5)

This working paper clearly identifies the problems with “[p]oorly thought out programs” that “encouraged bad underwriting and long-term management” and how they played out in affordable housing projects that were not intended to provide for permanent affordability. (73) It also provides a good foundation for a discussion of where affordable housing policy should be heading now.

A Different Approach to Homelessness

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JCS

Pacific Palisades Coast near Porto Marina

The Christian Science Monitor quoted me in In One California Community, a Different Approach to Homelessness. It reads, in part,

On a sunny morning in the beachfront community of Pacific Palisades, Steven “Boston” Michaud perches confidently on a large dock tie just above the sand. He waves vaguely at the hills above the Pacific Coast Highway, indicating where he sleeps. “It’s up there, but you’ll never see me,” he says, pointing to his own shadow on the ground, “because I’m a shadow and I don’t bother anyone.”

Mr. Michaud is one of about 170 homeless people in Pacific Palisades, an affluent waterfront neighborhood in Los Angeles. Pacific beaches have long been a magnet for the homeless from around the world.

Overall, California experienced the second-largest increase in the number of homeless people (1,786 individuals) among the 50 states this past year, according to the US Department of Housing and Urban Development. As their ranks have swelled, some homeless people have edged out of the shadows and have taken up in tidier areas in the Golden State. That, in turn, has attracted the attention of residents – especially when crimes have occurred.

Even Michaud isn’t as invisible as he says he is. A local supermarket took out a restraining order against him.

 By and large, California has been dealing with these issues from a legal standpoint. In general, cities in the state have more anti-homeless laws than cities in other states, with an average of almost nine such laws in each of 58 Golden State cities, according to a report by the Policy Advocacy Clinic at the University of California’s Berkeley School of Law.

But some communities in the state think that too much emphasis has been put on law enforcement to deal with homelessness – and not enough on other approaches that account for the needs of homeless people and try to address the root causes of the problem. These places are thus coming up with a new generation of creative ways to deal with the persistent problem of homelessness. Pacific Palisades, which is trying out a private, philanthropic approach, is one of these communities.

*      *      *

Private philanthropy in support of community needs is not new, says Mr. Berg of the National Alliance to End Homelessness. But what is new and less common in dealing with homelessness, he says, “is the organized approach to philanthropy at the local level.”

While she applauds the ambition of the effort, Maria Foscarinis, executive director of the National Law Center on Homelessness & Poverty, has concerns about the implications of a privatization approach. “The government’s role is to provide for public needs in critical times,” she says, adding, “This just serves as yet another example of the government stepping away from that role.”

Beyond that, there is the question of who can afford to duplicate the Palisades approach. Raising enough money to hire social services staff is beyond the reach of many communities, says Brooklyn Law School professor David Reiss, who specializes in housing policies. “So it is unlikely that Pacific Palisades is going to start a big trend, but a well-intentioned program could be effective locally, like many other community-based initiatives.”

HUD at 50

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United States Dept of Housing and Urban Development by Tim1965

The Office of Policy Development and Research at the Department of Housing and Urban Development has issued HUD at 50: Creating Pathways to Opportunity. It is a massive tome, with a lot of interest in it for the housing geeks among us. In the Preface, Deputy Assistant Secretary for Policy Development Lynn Ross writes,

This volume looks back on HUD’s history and looks forward to ways the agency might evolve. If you are familiar with the mission and the work of PD&R, you will not be surprised to learn that this book includes thorough analyses of not only how programs succeeded, but also how they sometimes fell short and what was done in response. I hope you will take the time to engage with the analysis and ideas contained throughout this volume. We’ve organized this book so you can read the thematic chapters in any order—although you can certainly read it cover to cover.

Given that HUD at 50 is more than 250 pages long, only the most dedicated among us will do so. Nonetheless, it is worth skimming the table of contents to see if any of the entries are worth reading in full:

  • Introduction by Julián Castro
  • Chapter 1 The Founding and Evolution of HUD: 50 Years, 1965–2015 by Jill Khadduri
  • Chapter 2 Race, Poverty, and Federal Rental Housing Policy by Ingrid Gould Ellen and Jessica Yager
  • Chapter 3 Urban Development and Place by Raphael W. Bostic
  • Chapter 4 Housing Finance in Retrospect by Susan Wachter and Arthur Acolin
  • Chapter 5 Poverty and Vulnerable Populations by Margery Austin Turner, Mary K. Cunningham, and Susan J. Popkin
  • Chapter 6 Housing Policy and Demographic Change by Erika Poethig, Pamela Blumenthal, and Rolf Pendall
  • Conclusion Places as Platforms for Opportunity: Where We Are and Where We Should Go by Katherine M. O’Regan

I will take a closer look at some of these chapters in the coming days, but feel free to dip in before I do!

Friday’s Government Reports Roundup

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Friday’s Government Reports Roundup

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  • According to the Family Outcomes Study conducted by HUD, Housing Choice Vouchers are critical in families maintaining housing. Children from homeless families that receive vouchers “are less likely to miss school, and they experience lower rates of hunger and domestic violence.”
  • The Office of the Inspector General for HUD released report, “Overincome Families Residing in Public Housing”, which finds that 1.1 million families currently living in public housing units have incomes that exceed the threshold, showing extreme examples.
  • The Census Bureau released an edition of “Facts for Features” comparing the New Orleans area prior to Hurricane Katrina and now, including number of housing units, business establishments, employment, etc.

Friday’s Government Reports Roundup

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Friday’s Government Reports Roundup

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