Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at the National Congress of American Indians 2010 Executive Council Winter Session

Washington, D.C. Monday, March 1st, 2010

Good afternoon. I would like to thank President Keel for inviting me to this year's Executive Council Winter Session, as well as Executive Director Jacqueline Johnson Pata and the entire 2010 Executive Board of the NCAI.

For nearly 70 years, NCAI has been a committed advocate for Indian Country -- representing over 250 tribal governments from across the country and playing a critical role in policy formulation and debate on Capitol Hill.

A Commitment to Native Communities

So it's an honor to join you today -- to discuss the challenges facing Indian Country, what HUD and this Administration is doing to help tackle those challenges, and how, going forward, we can be a better partner.

But first, full disclosure. Despite having spent the lion's share of my career producing and preserving affordable housing, when I came to HUD a year ago, the housing challenges of Indian Country were largely a mystery to me.

So early on, I set out to learn. Inspired by the words of a Native American proverb--"Listen or your tongue will keep you deaf"--I sought to gain a firsthand understanding of Native American housing and how HUD's programs work on the ground.

Each of my trips opened my eyes to the challenges facing Indian country.

In Montana, I saw firsthand some of the most severe cases of families living in overcrowded and substandard housing conditions. The headdress and quilt I received from Leroy Spang, the president Northern Cheyenne Tribal Council, hang just outside my office as a reminder of those challenges every day.

But I also saw how HUD investments could spark community transformation. In Alaska, I witnessed how one neighborhood in decline--with the lowest incomes in all of Anchorage, the highest crime rates, and deteriorating homes--could rise from the ashes with just a little help.

From an investment of $14 million that included CDBG and Neighborhood Stabilization Program funds, an Alaska Native regional housing corporation leveraged public and private commitments to the tune of $100 million. As a result, emergency calls to the neighborhood have been greatly reduced and its elementary schools have begun to improve.

The lesson from Alaska for me was clear: by bringing federal and state agencies together with tribal governments and private-sector stakeholders, we can leverage the resources we need to create economic stability and opportunity.

I'm proud of HUD investments in Indian Country -- how in 2009, the Indian Housing Block Grant program built or acquired more than 2,900 affordable homes and rehabbed another 4,400 units.

I'm proud that the Title V loan guarantee program has financed the development or rehab of over 2,000 affordable housing units and that Section 184 has guaranteed more than $1.4 billion in mortgages for more than 9,700 Indian families -- with a foreclosure rate remaining consistently below 1 percent.

I'm proud that the ICDBG program has helped tribes build everything from fire stations to day-care centers -- and finance infrastructure projects like extending electric service and improving water and road systems.

Perhaps most important of all is Rodger Boyd's team. For several years, ONAP has been working to increase tribal capacity and awareness of the importance of leveraged financing opportunities -- from creating a new initiative to maximize Indian Housing Block Grant funds, to working with the IRS to make Low Income Housing Tax Credits more accessible, to providing national training sessions on mixed and leveraged financing.

Despite these efforts, I would be lying if I said historically we on the federal side have gotten it all right.

Quite the contrary. Despite the financial investment, federal Native American housing policy has failed to meet the needs of Native communities.

Now, let me be clear. This Administration has made an unprecedented financial commitment to Native American housing policy -- and Native American policy as a whole.

You can see that commitment in the more than half billion dollars in Recovery Act funding invested in the Native American Housing Block Grant program to fund new construction, acquisition, rehabilitation, including energy efficiency and conservation, and infrastructure development activities.

It is reflected in the $700 million appropriated for NAHBG in FY 2010, a $55 million increase and the highest mark that program has ever seen.

Understanding the Need

But the truth is that no one fully understands the needs in Indian Country -- certainly not in the Federal government.

We do know an estimated 40 percent of reservation housing is considered inadequate -- as compared with roughly 6 percent nationwide.

We know that in Indian cultures, when housing is scarce, instead of homelessness, we see overcrowding. Extended families doubling and tripling up in modest housing, rather than leaving family members to fend for themselves.

Because of these unique needs, beginning in FY2011, HUD will conduct a comprehensive needs study.

Several studies on housing needs in Indian Country have been conducted in the past. Overcrowding on trust lands is six times the national rate -- in Alaska Native villages, eight times.

But most of these studies were limited in scope -- with the last comprehensive studies done in 1996. Using 2000 census data, today we believe nearly 275,000 households have "severe housing needs" -- lacking basic plumbing or kitchen facilities, paying more than half of their income on housing alone, or doubling up.

The one thing all these studies agree on is that the Indian community is in critical need of better housing.

And so, in consultation and collaboration with tribal leadership and our federal and state partners, HUD is embarking on a comprehensive needs assessment -- not just housing needs.

Through these partnerships, we will develop a long-term and long-overdue economic and community reinvestment strategy -- looking not only at housing but other obstacles, including access to quality healthcare, schools, transportation and employment.

To prepare, ONAP will be holding a series of regional workshops this year. We will invite a diverse group, including tribal leaders, Native housing professionals, and other federal agencies. You will hear from us shortly about dates and locations.

This is not simply an excuse to "check a box" every decade or so -- but rather part of an ongoing process that we can build off. One idea being explored is using NAHASDA annual reporting requirements to update the needs assessment-- so our programming is informed by the latest data and the clearest picture possible.

As HUD takes a step back to understand need, it forced me to make one of the hardest choices I have had to make this year -- the decision to request reduced funding in FY2011 for the Native American Housing Block Grant program.

I recognize these cuts come at a very difficult time, particularly after last year's increases.

But I would quickly add that these cuts were by no means limited to Native American programs alone. Faced with the President's three-year budget freeze, we made the difficult choice to reduce funding for several programs that had received substantial Recovery Act funding -- including our Public Housing Capital Fund and HOME.

Indeed, funding under the Recovery Act was designed to be spent over a three year period -- and with tribes having expended only 38 and 20 percent of Formula and Competitive funds respectively to date, the vast majority of these block grant funds will be available to leverage for two more years.

Given that, it's important to recognize that the problem with Indian housing isn't just a lack of funding -- it's also a lack of capacity.

Indeed, you know as well as I that the capacity challenges in Indian Country are serious and longstanding, preventing funds from reaching those who need the most help. That's why just last week we convened a meeting to discuss the challenges you face when it comes to implementation.

If our goal is to put Native communities on sustainable footing, then we must first understand what sustainability means in Indian Country, and that is where HUD is targeting its investment.

If I've learned one thing this year as HUD Secretary, it's that "sustainability" means different things to different communities.

For Indian Country, I've learned that building sustainable native communities requires sustainable native economies -- institutions, human capital and legal frameworks that promote economic diversity and leverage sources of capital.

In that sense, housing is so important. We all know that housing has a tremendous impact on the surrounding community -- that when you choose a home, you don't just choose a home. You choose a community -- and the choices available in that community.

For tribal communities, this is especially true. I don't have to tell you how tribal economies suffer from a lack of housing.

People move to border towns. Money and resources leave the reservation. And perhaps most devastating of all, the reservation's cultural integrity suffers.

Indeed, the lack of housing choice has a direct connection to the lack of educational opportunity -- in that it impacts teacher recruitment and retention.

That is why HUD is working with the Bureau of Indian Affairs, the Department of Education and FEMA to provide housing for teachers who work on reservations.

We estimate that at least 4,500 homes are needed to meet the needs of teachers on Indian reservations. Working with Secretaries Salazar, Duncan and Napolitano, I'm committed to ensuring we provide the housing necessary so that Indian Country children can get the education they need to succeed in the 21st century.

Breaking Down Federal Silos

Indeed, building sustainable communities requires building partnerships, which is why HUD has spent the last year forging key interagency collaborations.

We've seen a decline in the percentage of people on reservations who apply for home loans over the past 5 years. This has happened for a variety of reasons -- from delays in the Title Status Report process, to inconsistent processing regulations, to the lack of lenders' familiarity with closing requirements.

HUD has been conducting a series of training sessions to educate lenders on the closing process when dealing with restricted lands. And Assistant Secretary Henriquez and Assistant Secretary EchoHawk are working to resolve the Title Status Report issue.

But HUD and BIA need to make this a priority. It may seem like a small technical issue. But streamlining the title process will directly impact homeownership and housing construction, leading to increased community development and an environment more conducive for lending on reservations.

Put simply, it is essential to our ability to promote more sustainable economic development on Indian lands.

Whether it is the interagency Infrastructure Task Force, or our work with the Departments of Agriculture, Health and Human Services and Energy, and the EPA -- to improve financial literacy, use housing as a platform to address health care and domestic violence, and weatherize homes to increase energy efficiency.

In all of these efforts, success won't be measured simply by what HUD does -- but whether we're able to work collaboratively to break down federal silos that for too long have kept federal funds from reaching the tribal communities that need the most help.

A New Era of Partnership and Consultation:

That's why we're committed to improving our consultation process with you, as expressed by the President's Executive Order.

HUD and tribal representatives will participate in negotiated rulemaking on NAHASDA reauthorization in about two weeks.

In so doing, we will build off of the success of the White House Tribal Nations Conference and the Government-to-Government Tribal Consultation Policy we're developing.

Together, we will change the way we do business -- and build the sustainable communities Indian Country needs to thrive.

I recognize that these are difficult times -- and that fostering relationships isn't easy after years of neglect. But together, with a clearer understanding of what works, what doesn't, and how we can break down barriers, I believe we can make a difference.

We can build more sustainable reservation economies and ensure that all Native Americans have a decent, safe, affordable place to call home.

And perhaps most of all, we can remove barriers to opportunity for tribal communities across the country.

That is our goal today. And together, may we rise to meet it.

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