WASHINGTON - The U.S. Department of Housing and Urban Development today awarded a $35 million grant to the City of Phoenix, Ariz. Housing Department that will be used to replace 358 older public housing units with 372 new public housing units.

In Phoenix, the HOPE VI grant for the Matthew Henson Homes will also develop 50 affordable and market rate rental units and 50 market rate homeownership units. The redevelopment plan includes new community centers for job training and youth programs.

"With this first HOPE VI grant, Phoenix will join other cities across the country that have transformed aging public housing units into livable, dynamic, mixed-income communities," said HUD Secretary Mel Martinez, who made the announcement. "HOPE VI doesn't stop there, it gives public housing residents job placement centers and training programs - the tools that lead to self-sufficiency."

"We've worked hard in Arizona to provide housing and once again I am pleased to work with the federal government and the City of Phoenix to assist our residents," said Governor Jane Hull.

Phoenix was selected from a pool of 66 applications the agency received for the 2001 funding. Today's grant will ultimately attract $89 million in total investment to Phoenix, a return equal to about $2.57 for every dollar invested this year in the program. In 1993, the first year of the HOPE VI program, the return was only 31 cents for each dollar invested.

HUD will award more than $491 million this year in HOPE VI grants. The funds will be used to build or rehab more than 12,000 housing units and replace 8000 older public housing units. Cities were competitively selected based upon the effectiveness of their public housing revitalization plans. HUD policy provides local housing authorities with the flexibility to develop revitalization plans that meet their own special needs.

The HOPE VI program was created as a result of a report by the National Commission on Severely Distressed Public Housing, which found nearly 100,000 public housing units in the U.S. in need of revitalization. The HOPE VI grants, first awarded by HUD in 1993, have five objectives:

• Improve public housing by replacing severely distressed public housing projects, such as high-rises and barracks-style apartments, with townhouses or garden-style apartments that blend aesthetically into the surrounding community.
• Reduce concentrations of poverty by encouraging a mix of incomes among public housing residents and by encouraging working families to move into housing that is part of revitalized communities.
• Provide support services, such as education and training programs, child care services, transportation and counseling to help public housing residents get and keep jobs.
• Establish and enforce high standards of personal and community responsibility through explicit lease requirements.
• Forge partnerships that involve public housing residents, state and local government officials, the private sector, non-profit groups and the community-at-large in planning and implementing new communities.

As part of today's award, HUD will pay temporary relocation costs for residents being displaced by the revitalization effort. Relocated residents who meet program requirements will be given the first opportunity to move back to the newly constructed units at the site. Alternatively, if residents choose not to return to public housing, they will be given vouchers to subsidize their rents in privately owned apartments. In addition, relocated residents receiving vouchers will be provided with the same job training and services offered to people living in replacement public housing.

Since 1993, not including this year's grants, HUD has awarded 149 HOPE VI grants to 90 cities. The program's $4 billion in awards has leveraged more than $7 billion in public and private funds.

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