As prepared for delivery. The speaker may add or subtract comments during his presentation.

Introduction

Thank you, Matthew [Hunter] for the introduction, and thank you for all the work you do every day to ensure the implementation and execution of HUD programs across the country. The role of Assistant Deputy Secretary for Field Policy and Management is no easy task. Rarely are people calling you with good news, but you and your team have nimbly handled multiple issues across the country concurrently. I don't think a circus juggler has as more balls in the air at one time.

I also want to thank each and every one of our HUD employees here today. You could be making more money in the private sector. You could be living without the stress that comes with ensuring vulnerable Americans have access to safe, sanitary, and decent housing. But you have not backed away from public service. You have not shied away from helping families in need. You don't hear it enough, so I want to say it again, thank you. The work you do is valued by me and by millions of families across the country because it is so important. HUD would not be the Department it is without your commitment.

To better showcase the work you do every day, we're leveraging non-traditional media platforms to tell our story. Earlier this fall, we redesigned HUD.gov. We also launched a new podcast called "House Keys," and rolled out our "Humans of HUD" photoblog-which puts a human face on the programs and services HUD offers. All of these endeavors are designed to elevate the great work you do in the field, and really show how HUD is impacting our nation's most vulnerable populations.

Vision for HUD

I want to give you a little insight into my three overarching priorities for the next year: developing our people, increasing the supply of affordable housing, and being better stewards of taxpayer money.

Developing those who depend on HUD

For generations, the idea of the government providing housing assistance meant only one thing-helping to pay the rent so families can have a roof over their heads. But we must also think about how we can help families access financial programs, education, and other opportunities. In short, we must think beyond investing in bricks and mortar, and think about investing in human capital.

In today's very tight labor market, employers are desperate for workers and we need to rise to the challenge. The result would be a win-win for everyone - with tenants earning more money so they can graduate from HUD assistance, and local economies getting more work-able persons.

That's why HUD is focusing far more on policies and partnerships that bring together the public sector, private sector, and nonprofit community. These partnerships are key to further developing the skills and talents of our residents - with the end goal of an independent life beyond public assistance.

I know you're familiar with Jobs Plus, Moving to Work, and Section 3 - in fact, we are planning on announcing new rules for Section 3 in the new year. These rules will make it easier for HUD grantees to utilize Section 3 and will help HUD-assisted families tap into the economic opportunities that HUD funds.

We need to envision a new path forward for our residents - one that takes a holistic approach and goes beyond simply providing housing - and our EnVision Centers are instrumental in that respect, providing a one-stop shop, for key services in health, education, and job training.

The work you are doing in the field is leading the way and carving out a new direction for how housing assistance programs operate-so that they encourage economic advancement and well-being for America's vulnerable families.

Increasing the supply of affordable housing

Rising interest rates are putting a spotlight on an issue that impacts all of us in this room: affordable housing and our country's insufficient supply of it.

With rents rising faster than incomes, despite low unemployment and strong economic growth, we need to bring everybody to the table to produce more affordable housing and ease the pressure that's forcing too many of our neighbors into our shelters and onto our streets.

The issue of supply and demand is not just a federal problem-it's everybody's problem. We need to collaborate with every level of government and with the private sector to share ideas on how to apply evidence-based best practices. Solving our nation's affordable housing challenges will take a team effort.

HUD is doing our part to address the affordable housing shortage.

One key part of this is ensuring that the affordable housing overseen by HUD is safe and accessible.

In September, we broke ground on the 100,000th public housing unit preserved through the Rental Assistance Demonstration, or RAD, program. This public-private partnership, which many of you are familiar with, has generated close to $6 billion in construction investment and over 108,000 jobs.

If not for RAD, HUD estimates it would have taken 46 years to accumulate enough public capital to achieve these same goals. RAD continues to be a tremendous preservation tool for our existing housing stock.

We're also working on multiple fronts to increase our country's affordable housing supply, including reducing regulations on manufactured housing.

And, to improve how our programs help the tenants they serve, we are expanding our Moving To Work program so that local PHAs have more tools to tailor their programs to the needs of the local population, including flexibility to ensure that housing assistance programs do not discourage residents from working or taking higher paying jobs.

While unemployment is at historic lows and the housing market has ticked up, the demand for affordable housing is still staggering.

Only one in four households eligible for housing assistance actually receive it, and many of our public housing authorities have multi-year waiting lists. And as you know, even those that do receive assistance often have a difficult time securing housing.

To help meet this demand, we need more landlords to participate in our Housing Choice Vouchers program. So, we've launched a Landlord Task Force, which just completed listening forums in seven cities across the country to examine how we can all work together - local governments, public housing authorities, landlords, and HUD-to improve our voucher program and increase opportunities for the 2.2 million families it serves today.

We're working to bring fairness to fair housing by increasing the supply of affordable multifamily housing through several initiatives. As many of you are aware, earlier this year, we put out an advance notice of proposed rulemaking and announced our intention to amend the Affirmatively Furthering Fair Housing, or AFFH, Rule.

The current highly prescriptive regulations give participants inadequate autonomy in developing fair housing goals. They are also ineffective in addressing the lack of adequate housing supply, which has a particularly adverse impact on protected classes under the Fair Housing Act. These tools simply proved to be unworkable, which is why we felt compelled to take another look at AFFH.

Furthermore, while many of AFFH's objectives are certainly commendable, I am sensitive to criticisms that AFFH's approach was too heavy-handed and Washington-centric. What we want to do in pursuing new rulemaking, and why we've asked for public comment from all parties concerned, is to lessen regulatory burdens and help empower local officials to meet their obligations as they judge best.

While the current rule centers on analytics to discover discrimination, I hope local leaders will take a closer look at the archaic local and state regulatory barriers, such as outdated zoning and land use restrictions. These restrictions are preventing the construction of new mixed-income multifamily developments, whether they are in poor or in wealthier neighborhoods.

Basically, we need to encourage the development of mixed-income multifamily dwellings all over the place. And how can we do this? By working together with local officials and leaders to examine existing rules and regulations to see if they're inadvertently driving up the cost of housing and multifamily development.

As noted, the National Association of Home Builders estimates that more than 25% of the cost of a home is the direct result of federal, state, and local regulations. Currently, a large majority of land parcels in big cities are only eligible for single-family homes-not larger multifamily buildings. These larger multifamily buildings could house more people and, in the process, moderate rent prices which continue to climb higher and higher in our large cities.

A study by the CATO Institute reveals that federal housing vouchers go to the most-restrictively zoned states at more than twice the rate that they go to the least-restrictively zoned states. And, the most-restrictively zoned states receive nearly two times more federal dollars per capita than the least-restrictively zoned states because of the high price of land use.

Overall, we are taking a long, serious look at all the regulations that have held back America's affordable housing supply - especially multifamily housing - from keeping pace with demand. HUD is doing its part on the federal side by conducting an ongoing review of the agency's federal regulatory burdens. But to be successful, we need local communities to get involved and we need each of you to be HUD's voice in the field, encouraging the communities you live in to identify, share, and implement best practices that will lead to more housing construction.

After all, it strengthens our communities if the teachers, firefighters, police officers, and nurses that serve them can afford to call them home.

Being good stewards of taxpayer money

When I became Secretary, the Chief Financial Officer position had been vacant for several years. I made it a priority to get a C-F-O onboard, so we can protect taxpayers' funds and streamline operations. Thankfully, Irv Dennis, who spent 37 years at Ernst and Young, took on this task and has done a phenomenal job at getting us where we need to be.

To operate sound financial systems and operations, any organization needs strong people, processes, and technology. I can say, with pride, that HUD has great people, like you, who love what they do and are motivated not by the salary, but by helping their fellow Americans.

HUD has not always invested enough in processes and technology. Currently, we are implementing better financial processes and controls, so we can maximize our budget and protect taxpayers' funds.

The Office of the Chief Financial Officer has developed a three-to-five-year Finance Transformation Plan and formed an Agency-wide Integrity Task Force designed to reduce risk and improve areas of operational deficiencies within HUD.

Given the growth in disaster recovery grants in the past few years, we have dedicated resources to proactively review the internal controls related to the flow-of-funds. The process is designed to review internal control compliance before significant CDBG-DR funds are dispersed.

We are also modernizing our Information Technology (IT) systems. This is not news to any of you, but HUD has antiquated IT systems. They do not interface very well, are clumsy to work with, and expensive to support. There is good news on this front. We recently partnered with the General Services Administration (GSA) as part of the Center of Excellence initiative to modernize HUD's information technology systems and operating procedures. I am proud of our O-C-F-O team for their support and embracing a new path forward.

Over the last nine months, we have made improvements in many areas and our efforts have yielded some positive results. It will take a three-to-five-year effort to fully remediate HUD's financial statement material weaknesses and restore stability, but I am confident we are making the proper investments in people, processes, and technology to achieve our goals.

Implementation of FPM Protocols

Changes are not exclusive to Headquarters. We are streamlining our organizational structure by delegating more authority to our staff in the field so that all of you feel empowered to act decisively when confronted with local issues in your communities.

Our new Standard Operating Protocols provide guidance on how to work with our stakeholders and support the people we serve. They also convey substantial field office management and operational authority to the Office of Field Policy and Management and Regional Administrators.

The authorities provided to the R-As are:

• Authority to coordinate the implementation of the Department's policies and programs in the field;
• Authority to manage the work environment and key operational and administrative functions, and to exercise a leadership role to convey and meet agency priorities in the field;
• Authority to respond to urgent operational needs and opportunities;
• Authority to convene partners (local elected officials, the faith community, philanthropic partners, and business leaders); and
• Authority to advise the Secretary on policy and management of the field.

The new protocols enable F-P-M and the R-As to provide leadership and optimize operations in the field through cross-program coordination. Nothing here at HUD should ever happen in a bubble, and these new protocols will spur the kind of collaboration that will allow us to better serve HUD-assisted families.

FQMR

We are not just updating the protocols and hoping for the best. This year we began Field Quality Management Reviews (FQMRs) in four cities: Boston, Massachusetts; Fort Worth, Texas; Portland, Oregon; and Richmond, Virginia.

These reviews, led by Marcelline Yearwood, are an important tool in ensuring that HUD is operating as efficiently as possible. By evaluating how each program office is performing the field, we are measuring our work to identify ways to improve and increase collaboration.

When I was a doctor and performing complex neurosurgery, I was never alone. There were other doctors, nurses, and anesthesiologists. We had to work together to ensure our patients survived and the surgery was a success. After each surgery, we held after-action meetings to go over what worked, what didn't, and what we could do better. These F-Q-M-Rs are like the after-action meetings I held as a surgeon, and in the long-run they will improve the way we serve HUD-assisted families.

Conclusion

I want to thank all of you again for what you do. I'm optimistic that we can meet the affordable housing challenges facing our nation and ensure that our cities and communities are accessible to all the families we serve.

We are envisioning a new path forward in all aspects of our housing policies. And that's what I want to bring to those we serve, a new vision: one of hope, self-respect, self -sufficiency, and the opportunity to exercise their God-given talents.

I want to thank you again for your dedication and commitment. Together, we are strengthening America.

Thank you.

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