Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at the National Action Network Reverend Dr. William A. Jones Memorial Luncheon

New York, New York
Friday, April 16th, 2010

Thank you so much. It's an honor for me to take part in the National Action Network's National Convention for the second year in a row, and a special honor to be able to join you for today's Ministers Luncheon.

Reverend Sharpton, thank you for the invitation, and for your continued leadership --advocating for civil rights, equality, and social and economic justice by bringing a moral voice to these issues.

I would like to acknowledge Reverend Richardson, Bishop Blake, Bishop McKissick, Reverend Jackson, and New York City Councilman Charles Barron.

Let me also recognize today's honorees: Reverend Dr. Raphael Warnock, Reverend Dr. Herbert Daughtry, Sr., and Dr. Lawrence E. Carter Sr. It's wonderful to be able to join this event honoring you.

In particular, I want to recognize the family of Percy Ellis Sutton. Percy Sutton truly was "the father of modern Harlem," -- one of the real leaders in the revival of that great neighborhood, helping to bring jobs and affordable housing to its residents, getting the drugs and crime of the streets and rebuilding a neighborhood safe for families and seniors. Yet all the while ensuring that Harlem lived up to its title of the "capital of Black America."

I can think of no more fitting tribute to his accomplishments than gathering here today, in the presence of our nation's current, and future, civil rights pioneers.

HUD's history, too, is inextricably linked with the history of civil rights.

Indeed, in 1966 when Robert Weaver was tapped by President Lyndon Johnson to serve as HUD's first Secretary, he made history -- becoming our nation's first African American Cabinet member.

And HUD too was part of history -- founded at a moment when America's cities were literally burning, and our urban areas were in crisis.

HUD's work since its founding has continually been shaped by the forces of civil rights. Indeed, perhaps Secretary Weaver's most lasting achievement was the Fair Housing Act, which President Johnson signed into law in the wake of Dr. King's assassination.

So as we mark the month of April as National Fair Housing Month--and celebrate how far we've come as a nation and acknowledge how far we still have to go--I'm thrilled to join leaders from across the faith community this afternoon to share with you how we at HUD--and across the Obama Administration--are working to build the strong, sustainable and inclusive communities our nation and our families need to thrive and prosper in the 21st century.

And I'm honored to share with you the difference I believe we've made over the past year with President Barack Obama in office, working with partners like you -- trusted leaders in your communities nationwide.

Economic Recovery

Certainly, this has been a remarkable year -- for all of us who have dealt with a housing crisis that has touched every community in one way or another. Particularly hard hit have been middle class African American and Latino families -- for whom owning a home has been a critically important wealth vehicle and source of financial stability.

Indeed, when I spoke to you a year ago, our housing markets were in turmoil.

But due to the Obama Administration's swift, aggressive, and comprehensive approach--helping to maintain low mortgage interest rates, ensure mortgage credit access, provide tax credits for homebuyers, modify families' mortgages, and revitalize communities overrun with foreclosures--the housing market did significantly better in 2009 than nearly anyone predicted a year ago.

And a year on, while we are not out of the woods, home prices have stabilized and home owner equity started to grow again in the second quarter of 2009. And confidence derived from the increase in home equity has helped the economy grow at the fastest rate in six years and helped to create 162,000 jobs last month.

FHA, the Federal Housing Administration, is playing a vital role in ensuring access to our housing market. In 2008, 51 percent of African American homebuyers purchased homes with FHA financing.

And through the Making Home Affordable Program, we've worked to help families keep their homes.

While the program had a slow start, it's important to note that more than a million immediate foreclosures have been avoided because of trial modifications, saving these households an average of over $500 per month in mortgage payments. And an additional 650,000 FHA homeowners experiencing financial difficulty were assisted through FHA's variety of loss mitigation options.

And where the housing challenge before was bad loans, the challenge now is the havoc those loans have wreaked on our economy -- leaving responsible homeowners unemployed, with many owing more on their homes than they are worth.

You know this challenge better than anyone. You are the pastors to whom families turn in times of struggle. You don't need to read about the stories in the press, because you have been witness to them. You have had those hard conversations; you have prayed with and consoled men and women out of work, who are faced with the tragic choice between walking away from a home and keeping food on the table.

That's why--and in part because of hearing these stories from leaders like Rev. Sharpton and those of you gathered here today--we recently announced a series of changes to our programs that will give some unemployed borrowers relief as they look for work -- and provide underwater borrowers with the option to refinance into safe, affordable FHA loans.

Under these new changes, servicers will be required to provide a minimum of 3 months, and up to 6 months, of reduced or suspended mortgage payments to unemployed borrowers -- enabling them to remain in their homes as they look for work.

Indeed, we've made these changes because President Obama and this Administration believe that no family should ever have to choose between keeping a roof over their heads, and keeping food on the table.

Stronger, More Resilient Economy

But if we've learned anything in this housing crisis, it's that the problems our economy is facing today didn't begin with the foreclosure crisis -- in many cases, they were just made worse.

President Obama and I are committed to building a stronger, more resilient economy that offers every American the opportunity for a good job and a better life.

That commitment began with the Recovery Act, through which we've been able to build back some of the safety net that had been dismantled over the previous 8 years -- by cutting taxes for 95 percent of working families, extending and increasing unemployment insurance for 12 million Americans, and making COBRA available at a cheaper rate for people who've lost their jobs.

To help communities where foreclosures have torn apart whole neighborhoods, we're helping turn abandoned and foreclosed homes that drag down property values into affordable rental housing communities, through $6 billion in Neighborhood Stabilization funds.

And by creating 2.5million jobs, let's be clear -- the Recovery Act has helped stave off a second Great Depression, which would have turned back the clock on decades of wealth creation and advancement in the African American community.

Through the Recovery Act, we're also pioneering the green economy that our communities need to thrive -- by training the new generation of professionals, from mechanics and plumbers, to architects, energy auditors, and factory workers building solar panels and wind turbines. These are the good-quality, well-paying jobs that we will need to design, install, and maintain the first wave of green technologies.

HUD's Deputy Secretary Ron Sims--a civil rights pioneer in his own right from Washington State--often says that people of color, in large part, missed the technology revolution of the 1990s. We both agree that cannot be allowed to happen with the Clean Energy revolution--not this time--and thanks to the Recovery Act, it's not.

Helping New Orleans Move From Recovery to Revitalization

And speaking of Recovery, we're also making incredible progress helping New Orleans and the Gulf Coast recover from the catastrophe of Hurricanes Katrina and Rita.

Since I spoke to the National Action Network last year, I'm proud to say that with our partners in the Administration, we brought together nearly 350 public housing agencies from all over the country to provide customized case management and permanent housing solutions to 30,000 families who had been displaced from their homes those hurricanes.

And just last weekend, I was in New Orleans -- my fifth visit to the city as Secretary. I attended a ribbon cutting to celebrate the re-opening of one of the Big Four, and I participated in a Housing and Community Development and Infrastructure working session with Mayor-elect Landrieu's Transition team. There were five federal agencies and the White House represented at a series of meetings over two days, showing the ongoing and real commitment to the revitalization of New Orleans and the Gulf Coast.

Those sessions reminded me that no city more deeply demonstrates the need to plan and build our communities--our homes, schools, transportation, and job centers--so that they provide the most opportunities and choices to the people who live there in New Orleans.

I experienced a real sense of optimism and possibility in a city that didn't know those emotions for too long. And the sense of possibility is being made real thanks to the unwavering commitment to New Orleans from all of you and a President who has made the city's revitalization one of his Administration's highest priorities. With your help, we will make it right in New Orleans.

Building and Preserving Affordable Rental Housing

But as we continue to recover on all fronts -- both in the Gulf Coast and nationally, now is the time to look toward more fundamental reforms to prevent an economic crisis of this magnitude from ever happening again.

This requires a comprehensive, balanced national housing policy that supports access to homeownership, but that also provides affordable rental housing and brings public housing and other forms of assisted housing into the 21st century.

And it requires providing real opportunity for people living in neighborhoods of concentrated poverty and segregation, offering choices to help families live closer to jobs and schools.

That's why, since taking office just over a year ago, President Obama has made an unwavering commitment to improving and preserving affordable rental housing nationwide -- putting the Federal government squarely back in the affordable rental housing business.

Indeed, at a time when our families need it most, the HUD budget for this year--which President Obama signed into law-- fully funds the renewal of all project-based and tenant-based rental assistance contracts. Your voices were crucial in realizing this vision, and I want to take a moment to acknowledge your help. Thank you.

And in February, the President offered a proposed Fiscal Year 2011 budget that builds on these successes, even in a very difficult fiscal environment -- including a nearly $200 million increase in homeless assistance funding, a record number of people to be served by the Section 8 voucher program, and a billion dollars to capitalize the National Housing Trust Fund.

If you need any proof of this overwhelming commitment on the part of the Obama Administration to building and preserving affordable housing, you only need look around you.

Indeed, right here in New York, the Recovery Act invested some $423 million of public housing capital funds in NYCHA -- the single-largest grant to any public housing authority in the nation.

And just a short month ago, I was proud to stand with Mayor Bloomberg, Senator Schumer, and Congresswoman Velazquez -- announcing that over $100 million of funds from President Obama's Recovery Act were going to help rehabilitate over 20,000 public housing units in 21 developments across the city.

Thanks to this $100 million in Recovery Act funds, NYCHA will leverage an additional $410 billion dollars from public and private partners including the State of New York, the New York City Housing Development Corporation and Citibank.

At the same time we reached an agreement to make 12,000 NYCHA apartments eligible for Public Housing Operating Subsidies, estimated to bring NYCHA an additional $75 million of federal funds annually -- clear proof of the Obama Administration's dedication to help put NYCHA on a stronger foundation for years to come.

And today I'm pleased to announce that NYCHA is among 600 public housing authorities that will receive additional funding -- to support families currently participating in HUD's Housing Choice Voucher Program.

I want to thank Senator Schumer and Congresswoman Velazquez for their work in making this additional $150 million possible for public housing authorities across the country -- and congratulate NYCHA Chairman John Rhea on NYCHA's nearly $24 million award that will allow the agency to continue supporting up to 2,500 families.

This special additional funding will help NYCHA continue to provide affordable housing for New Yorkers in need.

Transforming Rental Assistance

In our FY11 budget, we've also launched a long-term Transforming Rental Assistance initiative, or TRA.

Today, we have a parallel system where most families live in housing financed, developed and managed in ways that can be integrated--literally and figuratively--with the surrounding communities -- while the two-and-a-half million poor families served by HUD's oldest programs live in another.

TRA will bring HUD's rental assistance programs into the twenty first century, putting these programs on a more sustainable footing for years to come.

I'm proud that the Obama Administration provided an additional $4 billion in public housing capital funding as part of last year's Recovery Act.

But that funding meets only about a fifth of the estimated $20 billion capital backlog in public housing properties. At the same time, we've lost 150,000 units from our inventory of assisted stock through demolition or sale in recent years.

Given the size of the federal deficit we've inherited, it's clear the Federal government alone will not be able to provide the funds needed to bring properties up to date and preserve them for the next generation. TRA will allow public housing to attract capital from private and other public sources.

Over half a century ago, in 1954, the Warren Court's unanimous decision in Brown vs. Board of Education stated that "separate educational facilities are inherently unequal." Well, a separate housing system for low-income families is also inherently unequal. Let's work together to complete this unfinished business of the Civil Rights movement -- and work to ensure that all families can live in sustainable, vibrant communities of opportunity and choice.

Creating True Neighborhoods of Choice

But we also know that choice isn't always about moving -- it's about having the choice to stay in a community with opportunity, safety, good schools and a mix of incomes. That is the goal of our Choice Neighborhoods initiative.

There's no question that the HOPE VI program has become one of our country's most powerful weapons to fight concentrated poverty and rebuild distressed public housing.

At its best, HOPE VI changed the world outside the development gates -- reducing neighborhood poverty, crime, and unemployment; increasing income and property values; and spurring investment, business growth, and jobs.

Indeed, over time, HOPE VI transformed from a housing program into a dynamic way communities could learn from best practices -- encouraging participants to invest in the most catalytic and meaningful neighborhood impacts.

It is that foundation that we seek to build upon with Choice Neighborhoods. Choice Neighborhoods celebrates HOPE VI's successes, but also learns from its mistakes. And it gives communities more tools to tackle their interconnected needs.

By expanding the HOPE VI toolkit to allow for the redevelopment of private and federally assisted properties alongside public housing, Choice Neighborhoods will bring disinvested properties that had no tool for redevelopment under the HOPE VI umbrella.

Building More Inclusive Communities

But let's be honest: the truth is, you can't hope to build a truly sustainable community of choice if you promote segregated development patterns and concentrated poverty.

Let me take you back to the founding of HUD -- and the Fair Housing Act. With the passage of the Fair Housing Act in 1968, we acknowledged that segregation didn't happen in spite of government policy -- it happened in large part because of it.

And we affirmed that government has a role to play in creating integrated, inclusive, diverse communities with access to opportunity for all.

That is fair housing. That is equal opportunity.

That is the realization of the life's work of so many of you gathered in this room.

And that is what we are fighting for every day in our work at HUD and across the Administration. In fact, it starts at the top. Indeed, long before he became our President, access to opportunity for all was what a young community organizer named Barack Obama was fighting for in public housing in some of Chicago's poorest neighborhoods.

And to this day, it has remained among President Obama's highest priorities.

To be sure, one of our most important responsibilities at HUD is to enforce the Fair Housing Act. This work is always important, but particularly so today, as we battle an economic crisis in which housing, as I said earlier, was ground zero for discrimination, fraud and predatory lending.

At the same time, evidence shows that discrimination continues, particularly against people of color, families with children and the disabled.

That's why, this past year, HUD has filed 12 Secretary-initiated complaints and conducted an additional four Secretary-initiated investigations.

We're not waiting for individuals to come to us, but rather, monitoring, tracking and taking the initiative.

This new commitment to the strategic and aggressive enforcement of the Fair Housing Act and protecting against discrimination of all kinds starts with President Obama and at HUD -- but doesn't end there.

That's why we're working collaboratively across the federal government, through the Department of Justice, with the Financial Fraud Task Force. To keep lenders who don't play by the rules accountable, HUD's budget this year includes $37 million to combat mortgage fraud and predatory practices, a third of which will go to curbing lending discrimination through increases in HUD's fair housing activities.

The Task Force's non-discrimination working group, which HUD co-chairs, will build on these efforts, identifying opportunities for coordinated action, including joint investigations and enforcement actions.

The Promise of America

Still, for all these efforts, you and I both know that Dr. King's dream won't be realized in our courtrooms alone -- but rather in the neighborhoods each of us works to help communities build.

And that's where you come in.

President Obama has launched an historic engagement with the African American church and a wide range of other faith leaders and traditions.

Indeed, just last week, the President met with heads of many of the major African American denominations to celebrate Easter, including the largest Baptist and Methodist conventions, as well as leading independent pastors. They discussed ways that local leaders and national groups can help advance the administration's agenda around jobs, community development and responsible fatherhood.

And here at HUD, we will continue to build on our longstanding partnerships with faith-based and neighborhood organizations like the National Action Network through our own Center for Faith-Based and Neighborhood Partnerships.

This office is playing a critical role in helping us connect with organizations like yours to build communities that are strong, vibrant, and above all, inclusive.

All of you have unique relationships with so many of the communities that we need to lift up in the wake of the economic crisis.

They know you. They trust you. They respect you.

That's why I want you to know that we are committed to continuing to listen to your lessons and experiences, and to working with you to ensure that families and communities who need help, get help. You must--and will-- continue to be a part of the solution.

Indeed, you understand that building communities in a more integrated and inclusive way isn't separate from advancing social justice -- it's absolutely essential to it.

You understand that if there isn't equal access to safe, affordable housing, there isn't equal opportunity.

You understand that how we develop our national housing policy is one of the great civil rights debates of the 21st century.

And above all, you understand that in America, we should never be able to predict a child's life expectancy by the zip code they grow up in!

Together, we're committed to changing the way we do business at HUD -- changing this country for decades to come by making strong, inclusive communities the foundation of America's prosperity.

That is our goal today. Let us rise to meet it.

God bless you all -- and thank you for this opportunity.

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