Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at the HOPE VI Green Building and Energy Efficient Development Conference

Washington, DC
Thursday, June 25th, 2009

Thank you, Sandy (Henriquez) - for that very generous introduction. Sandy is our new Assistant Secretary for the Office of Public and Indian Housing - and she arrives not a moment too soon.

As you will shortly hear, the kind of public and private collaboration and partnership efforts she led as Administrator and CEO of Boston's Public Housing Authority for the past 13 years are central to our new vision for HUD.

Sandy is poised to bring HUD's public housing efforts into the 21st century - and we are thrilled to have her on board.

Well, let me simply welcome everyone for traveling to Washington today. We have a great program in store for you over the next day-and-a-half.

The HUD and PIH team and our partners at the Departments of Energy, Transportation, Labor, Education, Health and Human Services, and EPA appreciate you coming to this conference to learn how to plan, design, build and maintain energy efficient, affordable housing communities.

We have sessions on the latest green technologies, construction practices and materials.

Other topics include green finance and certifications, energy audits, green jobs, among others.

We also plan on sharing with you some eye-opening case studies of Public Housing Authorities around the country who have used HOPE VI as a platform for building energy efficient, sustainable, affordable housing communities.

Our hope is that you'll come away with new ideas on how you, your development partners and HUD staff can work together to plan, design, build and maintain energy efficient affordable housing communities.

HOPE VI: Essential to Building Strong Communities

This conference comes at an important moment, as communities around the country each grapple with the same fundamental problem:

How to keep our neighborhoods strong in the face of an economic storm rooted in a crisis in our housing markets.

As representatives from public housing authorities across the country, you know that a home is the foundation upon which we build our lives, raise our children and plan for their future.

Home is family.

It is an essential source of a family's stability - the building block with which we forge neighborhoods, put down roots and build the communities that are the engines of our nation's economic growth.

That's why ensuring that every American has access to decent, safe and affordable housing is not just part our shared mission - it is the core of our mission.

The HOPE VI program we discuss this week has played an essential role in our efforts - meeting a need in communities across the country.

Twenty years ago, our country was ready to embrace new thinking about public housing.

In response, Congress created a National Commission on Severely Distressed Public Housing - the goal of which was to not only identify public housing developments with high rates of vacancy, crime and dilapidation, but to create an action plan.

Some wanted to sell off dilapidated public housing to the poor as England had done.

Others thought that only changes at the margins were needed.

And still others believed the underlying problem was how public housing could sometimes contribute to the concentration of poverty that created so many social problems.

It was out of that effort that the HOPE VI program was created in 1992. Its goal was simple:

To demolish obsolete and dilapidated public housing and replace it with decent, safe, affordable housing.

But as Senator Barbara Mikulski-the mother of HOPE VI-put it, "HOPE VI is not only about tearing down. It is also about building up."

Indeed, it is. Over the last 17 years, 248 HOPE VI sites have been built at 131 public housing authorities in 35 different states.

More than 92,000 units-about a third of which were vacant-have been demolished -- replaced by more than 107,000 new or renovated units - more than half of which will be affordable to the lowest-income households.

As a direct result of HOPE VI development, tens of thousands of affordable project-based Section 8 units and thousands of Section 202 senior's units have also been built, - community centers, parks and trails, grocery stores, Boys and Girls Clubs, Head Start Facilities.

In all, the $6 billion HUD has invested in HOPE VI has leveraged almost three times that amount in additional development capital - $17.5 billion.

HOPE VI has not only provided a good return for the taxpayer - it's changed the face of public housing, becoming an anchor of stability for communities across the country and, to quote the Urban Institute, a "laboratory to test new…ideas about public housing finance, management, and design."

From Recovery to Sustainability

Despite these successes, the foundation we've worked so hard together to build with HOPE VI and other critical efforts has been seriously eroded by our ongoing housing and economic crisis.

Millions of Americans have already lost their homes or are in foreclosure. Some have fallen into homelessness, devastating families and communities alike. And as a result, many of the communities we have worked so hard to lift up have fallen back into disrepair.

So, HUD's first responsibility is helping our communities get back on their feet again.

That work began with the Recovery Act - which through HUD is pumping some $14 billion into communities across the country - 75 percent of which was allocated within a week. $4 billion is for public housing authorities, helping to address the severe backlog created by underfunding during the last administration.

But as we work to help our economy recover and put a halt to foreclosures, we are also laying the groundwork for sustainable growth. We have made the highest amount of competitive funds available in HUD's history - encouraging state and local governments to develop new and innovative ways to improve public housing, rebuild communities, and increase energy efficiency.

We have also formed a partnership with the Department of Energy to streamline and better coordinate the use of $16 billion in federal weatherization funds appropriated through the Recovery Act.

By simply eliminating duplicative income verification requirements, we expect to be able to weatherize approximately 1.1 million public housing units, another 1.2 million privately owned federally-assisted units, and some 950,000 units financed with Low Income Housing Tax Credits.

As the Enterprise Green Communities program has shown, properties achieving 20 to 30 percent greater energy efficiency yield cost savings that accrue directly to low-income residents, or are reinvested back into the property in which they live.

And with HUD spending about $5 billion on energy for our public housing and Section 8 operations alone, savings to taxpayers, municipalities and low-income families alike through this effort are palpable.

A Greener HOPE VI

It's in this context that we've invited you here this week to see for yourselves how housing authorities across the country are using HOPE VI as a platform for innovation, building green and energy efficient affordable housing.

You'll learn about the New Columbia development in Portland, Oregon - how a complex originally designed to provide housing for defense workers during World War Two was transformed from a dilapidated, isolated public housing development into the vibrant mix of retail stores, apartments, townhomes, a public school, and senior housing it is today.

You'll hear how a dedicated rapid service bus line connects residents to a nearby light rail line and to downtown Portland, increasing access to jobs, services and opportunity.

You'll also hear how sustainable, green building has a clear connection to better health as well.

Right now, we can predict morbidity rates and life expectancy by zip code. Zip code!

But as we saw at Seattle's High Point development, an early commitment to building green can be a big part of rejecting that certainty for millions of children and lower costs in the long run.

As High Point's Breathe Easy Homes pilot program showed, by adding green features specifically designed to reduce asthma triggers, the number of asthma-free days increased, and mold-which often causes dangerous respiratory infections-was completely eliminated.

With unplanned doctor's visits declining as well, Seattle's housing authority was able to reduce one of the strains on our health care system which drive premiums up for everyone.

And you'll hear about Boston's Maverick Landing, a dense, walkable community that mixed land uses to create a compact community preserving open space, developed under the watch of our own Sandy Henriquez.

One of Maverick Landing's mid-rise buildings employs a cogeneration system that simultaneously produces electricity and heats water for space heating or hot water needs – by capturing exhaust gas from an automobile engine!

As futuristic as it sounds, the technology means the Boston Housing Authority pays lower heating costs and nothing for hot water in that building.

As you hear about these success stories, I think you'll begin to see for yourself that green, sustainable building practices aren't a "threat" to or a "luxury" for affordable housing - they're absolutely essential.

No one has more to gain from planning our communities in an environmentally sustainable way than low- and moderate-income families.

Going forward, we believe HOPE VI ought to incentivize green building so that as we encourage innovation, the burden isn't entirely on the public housing authority.

Choice Neighborhoods: A Sustainable HOPE VI

So, the results of HOPE VI are clear - substantial declines in neighborhood poverty, in crime and in unemployment and real, tangible increases in income, property values, and market investment.

Despite these successes, we believe we have only begun to tap the potential of the ideas and practices of HOPE VI.

That's why we've introduced our Choice Neighborhoods initiative, challenging public, private and nonprofit partners to extend neighborhood transformation efforts beyond public housing.

Public housing transformation always be a critical priority for HUD.

But for safe, affordable housing to be truly sustainable, it needs access to the good schools, child care, health care, public transportation, and retail businesses that are staples of every vibrant community. A Hope VI development that is surrounded by crime, disinvestment and failing schools cannot succeed.

And so, Choice Neighborhoods would build on the legacy and lessons of HOPE VI in several ways.

First, it would broaden the range of activities eligible for funding.

Choice Neighborhoods resources could be used to support the transformation of assisted housing development, the acquisition and renovation or replacement of unsubsidized, privately owned stock, and the construction of mixed income housing in strategic locations.

As a result, the pool of eligible applicants would be broadened to include local governments, non-profit intermediaries, private firms as well as public housing agencies.

And like the successful Jobs Plus Demonstration, residents in public and assisted housing would be eligible to receive work incentives and work supports.

Choice Neighborhoods would also link housing interventions more closely with school reform and early childhood innovations.

In several high-profile HOPE VI developments, we've seen significant improvements in the quality of the local schools and the educational performance of low-income children.

With preference given to cities and neighborhoods focused on intensive school reform and early childhood development activities, we believe we can foster synergistic relationships between housing and schools.

To the greatest extent possible, the Choice Neighborhoods initiative will be aligned with the Administration's effort to replicate the successes of the Harlem Children Zone through the new Promise Neighborhoods initiative.

To realize this expanded mission, our FY 2010 budget request would more than double the funding we saw under HOPE VI to $250 million.

Like our Sustainable Communities Initiative to better coordinate governmental efforts at all levels to integrate transportation, housing, and land use planning, Choice Neighborhoods is motivated by a similar principle:

When you choose a home, you also choose the schools your child attends. You choose transportation to work.

You choose...a community.

A New Era of Partnership

Whether it's this week's conference on HOPE VI to build green, providing Recovery Act funds to make our homes more energy efficient, or outlining a broad vision for sustainable growth, our ability to work in partnership has never been more important to America's immediate and long-term success than it is at this moment.

And seizing this moment requires transforming the way we do business at HUD.

That means better research, evaluation and accountability measures - to figure out how we can do more with less and give you the information you need to make informed choices.

It means partnerships and collaboration at all levels of government to drive green, energy efficient housing and sustainable growth in programs like HOPE VI.

And it means a balanced national housing policy that recognizes affordable rental opportunities are indispensible to our efforts to build the strong, sustainable communities America needs to prosper in the 21st century.

As President Obama has so eloquently said time and again, America has always been strongest when we work in partnership to build communities that are vibrant, durable and inclusive.

That is our goal with this conference and all our efforts here at HUD - and with your help and a new sense of urgency, I have no doubt that we will meet it.

Thank you and enjoy the rest of the conference.