CUOMO WILL URGE VETO OF HOUSE PUBLIC HOUSING BILL THAT ABANDONS POOR FAMILIES

WASHINGTON -- Housing Secretary Andrew Cuomo said today he will urge President Clinton to veto a House bill that would keep hundreds of thousands of poor families out of public housing and dramatically increase the number of higher income families admitted, if the House version of the bill reaches the President's desk.

The House bill would change income eligibility to allow more people earning up to about $35,000 to enter public housing. The median income in public housing today is about $6,500.

"The House bill adds insult to injury -- it seeks to improve public housing by excluding poor people and increasing public housing eligibility for people making $35,000 per year," Cuomo said. "First, the bill eliminates all new Federal housing assistance -- not a single new unit will be provided under the bill. Then it excludes the poor from existing housing."

"There is one simple question this bill can't answer -- where can the poor live if not in public housing? There are over 5 million poor families who qualify for 1.2 million public housing units. Where are they supposed to live?"

"I will urge President Clinton to veto this bill if this provision is not corrected," Cuomo said. "HUD supports an increased income mix in public housing, but the House bill goes too far in keeping out poor families to make room for people with higher incomes."

"How can we desert a family earning minimum wage for a family making close to the median income?" Cuomo asked. "We only hurt those who need our help the most -- the poorest of the poor."

"This could not have come at a worse time," Cuomo said. "It will also frustrate states' efforts to move families from welfare to work, because even families who successfully make the transition to work won't earn enough to get public housing. A full-time minimum wage worker earns approximately $10,000 per year -- a far cry from the $35,000 mark."

Under the House bill, substantially more than 65 percent of families admitted to public housing could have incomes up to $34,800 on a national basis -- denying scarce apartments to poorer families.

Under legislation proposed by HUD, 90 percent of families admitted to public housing would be the poor and working poor. Family income limits would vary around the country based on area median incomes, but on a national basis would amount to $13,050 for 40 percent of families, $26,100 for another 50 percent of families, and $34,800 for the remaining 10 percent of families.

"It is vital that the Administration, House and Senate come together to reach agreement on a bill that can be enacted this year," Cuomo said. "Without new legislation, public housing reforms we initiated will remain in effect only on a year-to-year basis, subject to change in appropriations bills. We will continue working with the House and Senate to reach agreement in Conference Committee."

The House, Senate and Administration bills all set income targets for new families admitted to public housing. All these targets are based on the median area family income.

Median family income varies in every metropolitan area -- ranging from $27,400 in parts of Louisiana to $60,800 in parts of Connecticut. (SEE ATTACHMENT). On a national basis, the median family income is $43,500.

Here is a summary of the income provisions in the three bills:

HOUSE BILL

Of new families admitted to public housing each year:

• Up to 35 percent of families could earn no more than 30 percent of area median income ($13,050 nationally, would vary in each locality).

• The remaining 65 percent of families could earn up to 80 percent of median income ($34,800 nationally).

• However, many more families could earn as much as 80 percent of median income ($34,800 nationally) if large numbers of very low-income families are admitted to the Section 8 program, which provides subsidies to allow them to live in privately owned housing. This could happen in many communities.

SENATE BILL

Of new families admitted to public housing each year:

• 40 percent of families could earn no more than 30 percent of median income ($13,050 nationally).

• Another 35 percent of families could earn no more than 60 percent of median income ($26,100 nationally).

• The remaining 25 percent of families could earn no more than 80 percent of median income ($34,800).

ADMINISTRATION BILL SUBMITTED BY HUD

Of new families admitted to public housing each year:

• 40 percent of families could earn no more than 30 percent of area median income ($13,050).

• Another 50 percent of families could earn no more than 60 percent of median income ($26,100).

• The remaining 10 percent of families could earn up to 80 percent of median income ($34,800).

Under HUD's Public Housing Management Reform Act of 1997, troubled housing authorities performing below acceptable levels would be monitored more closely by HUD, and could lose funding and be placed under court receivership.

The HUD legislation would allow housing authorities performing acceptably to devote less time and resources to reporting to HUD and to focus on delivering good housing.

Housing for about 6 million poor Americans would be covered by the legislation -- about 3 million in public housing developments and another 3 million in the tenant-based Section 8 program, which is run by housing authorities.