HUD DEPUTY SECRETARY TESTIFIES BEFORE HOUSE FINANCIAL SERVICES COMMITTEE ON GULF COAST RECOVERY EFFORTS
HUD Continues its Commitment to Help Gulf Coast Residents Return Home

WASHINGTON - U.S. Housing and Urban Development Deputy Secretary Roy Bernardi testified today before the House Committee on Financial Services on HUD's recovery efforts in the Gulf Coast, detailing the use of the $16.7 billion in Community Development Block Grant (CDBG) supplemental funds for the region's long-term recovery.

"The Department is committed to helping states with their recovery plans by offering guidance and assuring compliance with the law to prevent waste, fraud, and abuse," said Bernardi. "It is essential these state recovery plans are strong and sound so that all Federal Government funds are used to help those in need."

In response to the disasters, the Federal Government has committed more than $110 billion to help the Gulf Coast, including $16.7 billion for the CDBG program, which allows local officials great flexibility in prioritizing and spending. President Bush has given the Gulf States and their governors the principal responsibility for designing and implementing their individual rebuilding efforts. HUD continues to move quickly with reviewing and approving State recovery plans.

Bernardi also discussed the status of public housing in New Orleans, as well as the region's continuing challenges in creating affordable rental housing. The Deputy Secretary reiterated the Department's commitment to providing families displaced by the hurricanes the opportunity to return to HUD-assisted housing.

In New Orleans, HUD is working with the local community to redevelop public housing so families will have the opportunity to return to better, safer neighborhoods. The C.J. Peete, B.W. Cooper, Lafitte and St. Bernard public housing developments are schedule to be redeveloped to make way for a mixture of public housing, affordable rental housing and single-family homes.

"Immediately, in the aftermath of Hurricane Katrina, the Department's goal was to repair, rehabilitate or rebuild the affordable housing projects to the greatest extent possible to ensure that the residents could return as quickly as possible to the Gulf Coast Region," explained Bernardi.

"Of the approximately 5,100 units of public housing that were occupied and affected by the disaster, nearly 2,000 units have been repaired and are habitable. As Louisiana and the other affected States develop their solutions to the challenges they face in public housing, HUD will continue to offer its support and guidance."

Prior to Hurricane Katrina, there was a high demand for moderately affordable housing. Since the storm, finding affordable housing has been even more of a challenge, especially in New Orleans. Not only are there 112,000 fewer rental units in the five State Gulf Coast region, there is increased demand for the non-damaged rental units,

"We have been aggressive in our efforts to provide rental housing assistance to displaced families and individuals," stated Bernardi. "However, the pre-storm weak housing market, lack of affordable rental units, and increased construction costs has caused rent inflation."

In response to the need for more affordable housing, HUD has increased its Fair Market Rent Rate for New Orleans 45 percent since the storm. In addition, HUD has worked to provide previously-HUD assisted displaced families and homeless individuals with housing during this period by paying rental subsidies to over 30,000 persons and assisted close to 25,000 families in finding affordable rental units.

To read the full testimony, please visit HUD's website.

For more information about Hurricane Katrina rebuilding efforts please visit www.hud.gov.

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HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet and espanol.hud.gov.