Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at the Council on Foundations

2009 Fall Conference for Community Foundations

Marriott Rivercenter
San Antonio, Texas
Sunday, October 4th, 2009

Thank you, Steve - for that very kind introduction and for your remarkable leadership with the Council. I also want to thank Ralph Smith, the chair of the Council on Foundations' board and Executive Vice President with Annie E. Casey Foundation.

And many thanks to Mayor Julian Castro and Congressman Ciro Rodriguez for hosting us. It's a pleasure to be with so many men and women representing our nation's philanthropies and community foundations.

As you already know, the Obama Administration has made a historic effort to engage philanthropies - establishing an Office of Social Innovation within the Domestic Policy Council. And across the government we're looking at ways to partner with foundations - at Education, they've raised a $100 million match for their Innovation Fund.

But given the unique challenge of the economic crisis and the close connection between housing and opportunity, I believe there exists a special opportunity at HUD - both to help us meet that challenge and help us transform the way we do business as an agency. Something we share in common is our focus on place - your funding is bound to particular places and communities.

As you all know, housing has a special place in place-based interventions. When you choose a home, you don't just choose a home. You also choose transportation to work. You choose schools for your children. You choose a community. Place is at the center of every decision each of us makes.

And so, I want to outline a broad framework for how I believe HUD can be a better partner with our community foundations.

HUD's work has broad reach across urban, suburban and rural places in almost every neighborhood in America - and as I've traveled across the country, I've seen that work for myself, including partnerships with philanthropic organizations.

Partnering with foundations is not new to me. Before coming to HUD, I served as Housing Commissioner in New York City. And we built strong partnerships there.

With the Center for New York City Neighborhoods, it was foundations that helped us put in place a model for public, private and non-profit partnership to address the foreclosure crisis in a truly comprehensive way. At a time when many in government were in denial about the impending foreclosure crisis, it was foundations that had the resources—and the foresight—to act.

And with the New York City Acquisition Fund, it was foundations who identified the lack of access to early seed capital for nonprofit and other small housing developers, allowing $8 million in city funding and more than $34 million in foundation funding to leverage close to $200 million in private capital that will build and preserve 30,000 affordable housing units over 10 years.

Of course, it wasn't just New York. Over the last quarter century, we've seen a structural shift toward problem-solving at the local level - across party lines, inside and outside of government.

As the Federal government experienced a crisis of confidence about the success of the Great Society programs, the most important development in housing and community development has been the emergence of a third sector of non-profit community development corporations. With support from national and community foundations, these CDC's have become our most innovative housing developers and in many neighborhoods some of the most important civic institutions.

Through targeted investments in this third sector, you and your foundations became sophisticated social policymakers - and our non-profits respected practitioners.

Our challenge now is to restore federal leadership that takes these innovations to scale - not to return to an old model of federal intervention, but to capitalize on a new model of social innovation.

Improving the Quality of Data and Place-Based Research

And I believe there are four key ways we can do that.

The first is improving the quality of data and place-based research which is essential to evidence-based policymaking - to learning what's working, what isn't and what we need to do the job better, not just in Washington, but the communities we serve.

Community foundations have played a critical role in developing place-based indicators that tell us what's happening on housing, homelessness, civic health, and a host of issues at the local level.

You've helped us track dynamic neighborhood change in real-time in order to understand the impact of public and private investment. You've provided cross-cutting filters that blend those indicators to encourage a holistic view on issues from sustainable development to the relationship between housing and poverty. And you've helped communities see themselves in regional context - to see connections between transportation patterns, housing, health, and education.

For instance, we know that a child's ability to read at the 3rd grade level is an early indicator of future academic success. The Boston Foundation is working to help use this indicator to align and support work in other areas of its grant-making - connecting maternal health, early childhood education, and childhood poverty. It's exactly what we need to be encouraging at the national level - and are with HUD's Choice Neighborhoods initiative, which is aligned with the Department of Education's Promise Neighborhoods proposal.

The Fund for Our Economic Future's Regional Prosperity Initiative in Northeast Ohio is informing our work in a different way. With leadership from the Cleveland Foundation, they are showing how place-based research can identify the barriers communities face to develop and implement regional economic competitiveness initiatives - revitalizing a region that has undergone a prolonged period of economic transition.

We believe the "Data Dashboards" used in Northeast Ohio and similar tools will be essential to the work of a new White House Interagency Task Force on "Cities In Transition" - combining the White House Office of Urban Affairs and the Auto Communities Task Force. The Task Force will determine how federal funding can help those communities reposition their land assets and think of ways the alignment of federal funding—from housing to transportation—can be catalytic, promoting greater resilience to long-term economic challenges that predate the recent foreclosure crisis.

And to ensure we are aligning our interests around data and research, we have partnered on a What Works collaborative, which has already raised $1.3 million from the Rockefeller, MacArthur, Ford, Surdna and Annie E. Casey foundations.

Knowledge-Sharing and Convening

Data and research about economic, social and demographic trends is critical to policymaking at the local level - but the real power of these efforts is that they don't just sit on the shelf.

And that's where the second opportunity for partnership with community foundations comes in: Knowledge-Sharing and Convening.

Too often, the public sector can be insular and self interested - fearful that it will be criticized by the press or the very people its policies impact.

We're determined not to make that mistake at HUD and believe HUD can be a "hub" for knowledge sharing as well. But having served at the local level myself, I know that the need for objective, honest brokers outside of government can't be overstated.

Working together, the Federal government and foundations can ensure the crucial lessons you've learned from your data and research efforts are shared and replicated widely.

On countless issues, we have already benefited enormously from discussions with groups like the Funders Network for Smart Growth and Livable Communities, Funders Together to End Homelessness and the Living Cities collaborative.

Just this week, we had a HUD team in Phoenix examining Recovery Act investments with the Arizona Community Foundation and local partners to examine what lessons we can draw from this historic commitment of public funds.

I know some of you participated in an interactive session we held at the National Alliance to End Homelessness's annual conference in July as part of the Funders Together to End Homelessness. The feedback from that session and another last month at HUD is already informing our upcoming study on the Impact of Housing and Services on Homeless Families.

And I know many of you here have already come to Washington to discuss transit-oriented development in the context of our partnership with DOT and EPA and joined us on a day-long trip to Baltimore to discuss innovation and barriers.

Now, as we prepare to launch our Office of Sustainable Housing and Communities, I know many of you are working to establish a Sustainable Communities Coalition.

HUD's Sustainable Communities Initiative offers a big opportunity for knowledge sharing, with $140 million funding planning and challenge grant programs to help localities and metro areas undertake a new wave of transportation zoning, building code, and land use reform.

In order to leverage those resources to the maximum extent possible, today I'd like to announce that we will include philanthropic support in how we score these applications.

Catalyzing Innovation

The third opportunity for partnership is catalyzing innovation.

The truth is, foundations can test new ideas that government couldn't on its own. With our statutory and regulatory constraints, there is a fishbowl we operate in. Trying new things can be hard even for the most innovative governments.

You bring speed, and take risks government can't - or won't.

In New York, I saw for myself how Mayor Bloomberg reached out to private and philanthropic interests with a simple proposal - if you finance these new, even controversial ideas like conditional cash transfers and prove they can work to actually reduce poverty, we'll scale up those ideas with taxpayer dollars.

And if you want to talk about catalytic, place-based innovations that have influenced federal housing policy - you have to start with the ten-year plans to end homelessness we've seen in communities across the country.

It was that kind of work in communities across the country that enabled us to achieve a remarkable shift in our approach with the Recovery Act through a brand new $1.5 billion Homeless Prevention and Rapid Re-Housing program.

Now, as Chair of the Interagency Council on Homelessness, I'm looking to catalyze different approaches to make ending homelessness a measure of success not just at HUD, but across the Federal government. And we need your help again.

Breaking Through Silos

The fourth opportunity for partnership is to break through silos. Local governments may know place - but community foundations know how to connect place to people, institutions and ideas.

It's no secret that the Federal government tends to operate in silos - from one program to the next. It's really community foundations who have a unique vantage point to see where gaps exist and how programs can best be overlaid and blended - to work together.

And with the flexibility you have, regional foundations often provide the glue needed to make place-based policies work in a way that government often can't.

Efforts like the Recovery Partnership in Chicago have demonstrated this clearly. Terry Mazaney with the Chicago Community Trust saw what a unique moment we are in with the Recovery Act - $787 billion being pumped into our communities. But he not only saw that moment - he saw the need to create a broader platform for change and sustain it over the long haul.

And so, with Mayor Daley's leadership, more than 200 people from 50 foundations and every city department and sister agency are working across public, private and non-profit sectors to ensure Recovery Act dollars enhance existing platforms for investment.

In the same way, the Foundation for the Carolinas convened stakeholders last spring to develop a coordinated community response to Recovery Act opportunities. What resulted was a comprehensive portrait of the needs in the community and how to best serve low-income residents.

In New Orleans, where we are in the middle of perhaps the most urgent place-based intervention in our history, it was philanthropic organizations like the Greater New Orleans Foundation who stepped up and funded non-profits they knew could make a difference on the ground.

With that funding, non-profits such as the St. Bernard Project, who I've had the privilege of volunteering with, were able to develop a proven track record of helping families facing a gap in financing—from insurance reimbursements to FEMA grants—that prohibited them from returning to their homes.

That work signaled to us both the need to support this model but also to identify barriers to using federal funds to meet the needs of New Orleans families. As a result, we have taken action that will allow families to use CDBG assistance to bridge that gap.

New Orleans has shown us that with a new kind of partnership, we can learn from the way you bring these programs together.

We can start to break down silos.

And we can make taxpayer investments more impactful, catalytic and sustainable.

Bringing it all together: Green and Healthy Homes

Whether it's better data and research, sharing knowledge, catalyzing innovations or breaking down silos, we have our playbook.

But not only that, we have a great opportunity to use that playbook at HUD - by connecting Recovery Act energy efficiency efforts with HUD's Healthy Homes program. And I hope you introduce yourselves to Jon Gant, Matt Amon and Eric Hornbuckle from our Healthy Homes staff here with us today - as well as my Deputy Chief of Staff, Ana Marie Argilagos, who I'm sure has reached out to many of you already.

I know you're doing important work in this area. But they've joined me today because I want to tell you what we're doing - and what we're going to do with so many of you.

Over the last decade, with your help, we've reduced the number of children with lead poisoning by 75 percent.

Today, I'm proud to announce that HUD is awarding more than $118 million to 46 local lead hazard projects around the country - helping communities transition their lead programs into more holistic healthy homes programs that will allow them to address multiple housing-related health hazards within a single intervention.

The moment is right to transition the platform we've established for lead to a broader healthy homes agenda. Today we understand the relationship between stable home, health outcomes and costs. And with $20 million of Recovery Act grants HUD has awarded this year, we've effectively doubled Healthy Homes funding from the level it was at a year ago.

The Council has recognized this unique moment as well, committing to conducting 10 Green and Healthy Home demonstrations across the country. I want to announce today that HUD is unveiling a Green and Healthy Homes Initiative of its own in which we will commit $1 million for technical assistance in these cities.

Not only that, we will make sure all the necessary partners are at the table locally to learn from each others' experiences as we implement these programs and scale healthy homes models nationwide.

Using the lessons learned from these pilots, we will also conduct an agency-wide review to ensure that Green and Healthy Home standards are integrated throughout our programs.

But it's not just about HUD. We've already formed a federal Healthy Homes Working Group to establish a national healthy housing standard.
Today, I want to announce that we will finalize this standard within a year - and to ensure we can, we will include private stakeholders as members of that working group.

A New Era of Partnership

The truth is, it's been three decades since the Federal government's approach to place has been examined. Back then, people speculated that we were witnessing the death throes of American cities and metropolitan communities - and that government was powerless to help.

Since that time, we've developed tools that allow us to examine and enrich place in ways we never could have dreamed of even fifteen years ago, much less thirty.

We've seen the rapid evolution of the "technology" of combining housing plus services move the needle on chronic homelessness.

We've seen mixed-income, mixed use housing change the face of public housing.

We've seen the emergence of a whole new sector supported by community foundations around the country.

And this year, we've witnessed the benefits of that relationship as communities use the Recovery Act as a platform for rewarding innovation, integration, and collaboration all at once.

Last month in Denver, I saw how the model of New York City's Acquisition Fund is being adapted to preserve the affordability of neighborhoods served by its new multi-modal transit system.

In Kansas City, I saw how a 150-block neighborhood is directing Recovery Act funds into the same focused areas for investment to transform that neighborhood into a beacon for smart, green, sustainable economic growth.

In Anchorage, Alaska, I saw how a $14 million investment made by HUD has been leveraged into $100 million commitment by public and private partners, ensuring our collective investment serves an ethnically diverse community in what was once one of the city's poorest neighborhoods.

In place after place, I've seen that age-old city/suburb tension break down as they learn they not only share problems but can also collaborate on solutions.

That's only been possible because of the financial, intellectual and human investment of our community foundations.

We have an extraordinary opportunity - to nurture local innovations and bring some of the best ideas to the national stage.

Making that possible starts with recognizing change comes from the community level and often through partnership - mutual partnership with mutual commitment and mutual responsibilities.

Whether it's ending homelessness, rebuilding and revitalizing America's great, neglected cities, or creating a geography of opportunity where our choices are never limited or our futures determined by where we live--where our futures are never determined by our zip code--that is the scale of our ambitions.

In partnership with our community foundations, together we will take those ambitions to scale. Thank you.