Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at Solutions for Working Families: 2009 Learning Conference on State and Local Housing Policy

Chicago, IL
Tuesday, June 30th, 2009

Thank you, Conrad - for that very kind introduction. And thank you to the National Housing Conference and the Center for Housing Policy-and Conrad Egan and Jeff Lubell-for your commitment to affordable housing, and for joining forces to put on this new conference as a way for our state and local leaders to collaborate on solutions to the challenges facing our working families.

It's great to be back among friends. And let me congratulate you both for winning the 2009 MacArthur Award for Creative and Effective Institutions.

It's a particular honor for me as a former board member who knows firsthand that NHC really is the "United Voice for Housing" in our country.

For more than 75 years, NHC has been providing leadership and advocacy - furthering our common mission of providing safe, decent, and affordable housing to all Americans every step of the way.

That work has always been important - but never more so than today, 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 state and local housing experts and policymakers, you know that a home is the foundation upon which we build our lives, raise our children, and plan for their future.

You know that home 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.

Unfortunately, that foundation has been seriously eroded by our ongoing housing and economic crisis. Millions of Americans have already lost their homes. Others are in foreclosure. And some have fallen into homelessness, devastating families and communities alike.

That is why this conference comes at such an important time.

Not only does it give community partners the opportunity to hear about local solutions and innovations on issues from foreclosure prevention to rental housing preservation.

It's also an opportunity for those of us in government to listen - to hear what's working, what's not, and what else we need to be doing.

And I hope you all were able to take part in the HUD feedback session that just took place - and benefit from our participation during the week.

My experience in New York tells me that many of the most promising housing policy innovations occur at the grassroots - in localities and pilot programs, with the help of local governments, foundations and non-profit partnerships.

So, as you gather at this morning's plenary to discuss the future of housing policy after the foreclosure crisis, I want you to know that I'm committed to making HUD a facilitator when it comes to spurring innovation at the local level and bringing the best ideas to the national stage - helping communities respond to today's crisis while planning for the sustainable and integrated future we all know is within our grasp.

A Sustainable Recovery

Of course, HUD's first responsibility is to help our communities get back on their feet again.

That work began with the Recovery Act-through which HUD is pumping some $14 billion into communities across the country-75 percent of which we allocated within a week, totaling more than $10 billion.

$4 billion is for public housing authorities, helping them to address the severe backlog of improvement projects created by underfunding during the last Administration.

And our work continues with the President's Making Home Affordable plan. More than a million homeowners have received information about the plan and the 20 participating servicers have extended offers on nearly a quarter-million trial modifications so far.

We already have early signs that the overall housing market is stabilizing. But over the next few months, we need these numbers to grow significantly, and we are pressing lenders and servicers to step up their efforts.

But as we work to help our economy recover and put a halt to foreclosures, we must keep in mind the words of that famous Chicago-an who serves as our President's Chief of Staff:

"A crisis is a terrible thing to waste."

That is why we are also laying the foundation for sustainable growth.

Right now, we have the highest amount of competitive funds available in HUD's history through the Recovery Act - over $3.5 billion encouraging state and local governments to develop new and innovative ways to improve public housing, rebuild communities, and increase energy efficiency.

One of the most important competitive elements in the Recovery Act is the additional $2 billion we've invested in the Neighborhood Stabilization Program to help communities purchase and convert foreclosed and abandoned properties into new affordable housing, land banks, or other options that preserve neighborhoods.

These competitive funds will not only turn foreclosed properties into homes again, but also ensure that communities go about the rehabilitation and purchase process in a smart, collaborative, and, above all, sustainable way.

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 have made 1.1 million public housing units eligible for these funds, as well as another 1.2 million privately owned federally-assisted units, and some 950,000 units financed with Low Income Housing Tax Credits.

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

We've also offered several innovative budget proposals, including a $100 million Energy Innovation Fund that will seed local energy retrofit funds.

We want to work with local communities to leverage another $1 billion in private financing-from utilities, local banks, and state clean energy funds-to help catalyze a home energy retrofit market in the United States.

A New Foundation

Of course, all of these initiatives are predicated on a bedrock commitment to building and preserving affordable housing nationwide.

We need a comprehensive, balanced national housing policy that recognizes affordable rental opportunities are inseparable from sustainable growth.

Homeownership is incredibly important.

But it's long past time we recognized that long before the homeownership crisis in this country there was an affordable rental housing crisis - and it's still going on.

For years, the National Housing Conference has been the lone voice in the wilderness on this issue - and I want to thank you for never giving up that fight.

It's time we made affordable rental housing the priority it needs to be. And together, we will.

Indeed, President Obama's bedrock commitment began with full funding of Section 8 contracts in the Recovery bill and additional $1.8 billion of federal funding in our 2010 budget proposal for housing vouchers we so clearly need.

We want stability and consistency to be hallmarks of our work on both these programs going forward.

Our budget also requests $1 billion for the initial capitalization of the Affordable Housing Trust Fund. With 74 units available for every 100 very low-income households-and only 44 for those in extreme poverty-the Affordable Housing Trust Fund is essential to providing affordable housing in America.

Each of these efforts is based on our shared belief that if there isn't equal access to safe, affordable housing, there isn't equal opportunity.

But as we work on all these issues-offering more affordable housing options, making buildings more efficient, and helping families facing foreclosure-it's clear that we need to find ways to tackle all these problems together.

The truth is, when you choose a home, you also choose the schools your child attends, you choose transportation to work.

You choose a community.

That's the idea behind our Sustainable Communities Initiative, which encourages regions, via competition, to develop integrated housing, land use, and transportation plans.

We want to use those integrated plans to drive the planning and decision making of localities, increasing transportation choices and reducing housing and transportation costs for American families.

The Center for Housing Policy has been a national leader in putting these issues on the map, so to speak, by helping us understand that average working families spend nearly 60 percent of their budgets on housing and transportation costs.

That's not only unacceptable - during an economic downturn, it's unsustainable.

And so, the goal of this initiative is to articulate a vision for development or redevelopment tailored to specific metropolitan and rural markets that federal housing, transportation, and other investments can support.

Our Choice Neighborhoods Initiative is also motivated by a similar idea.

We all know the impact the HOPE VI program has had on communities around the country - substantial declines in neighborhood poverty, in crime and in unemployment and real, tangible increases in income, property values, and market investment.

HOPE VI has changed the face of public housing. But we believe we have only begun to tap the potential of its ideas and practices.

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

For safe, affordable housing to be truly sustainable, it needs access to good schools, child care, health care, public transportation, and retail businesses that are staple of every vibrant community.

A HOPE VI development surrounded by disinvestment and failing schools cannot succeed.

And so, Choice Neighborhoods would broaden the range of activities eligible for funding.

It would link housing interventions more closely with school reform and early childhood innovations.

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

At the core of all of these ideas is the same concept:

Planning communities in a more integrated, sustainable and inclusive way isn't separate from advancing economic opportunity for the families we're trying to reach - it's absolutely essential.

A New Era of Partnership

Whether it's helping our nation recover, or laying out a broad vision for building strong communities, HUD has never been more important to America's immediate and long-term success and sustainability than it is at this moment.

And seizing this moment requires transforming the way we do business at HUD - to ensure we become a dynamic force in the Federal government and a model for innovation.

I understand you've heard about our Transformation Initiative in depth this week from my staff but I cannot overstate its importance - not only to HUD, but to communities across the country.

For us, transformation means better research, evaluation, and accountability measures- to figure out how we can do more with less and give the marketplace the information it needs to make informed choices.

It means partnerships and collaboration with agencies, non-profits, and all levels of government. Too often, HUD hasn't been a catalyst for change - but a barrier to it.

This needs to change.

And it will.

This change is not the work of a day or a month or a year.

It's not the work of one speech or one Recovery bill or one budget.

And it is not the work of HUD or the Federal government alone.

For too long, we as housing advocates have been on the defensive, fighting each other for a slice of a shrinking pie.

To succeed in any of this, we must follow NHC's lead in becoming a "United Voice for Housing" - united in purpose and in recognizing where each of us-within government and outside of it-need to take a look in the mirror.

Ensuring we do is our goal today. As Dr. King said, "The arc of the moral universe is long - but it bends toward justice."

With a new sense of partnership and collaboration, I have no doubt that we will meet that goal. Thank you for this opportunity.