Prepared Remarks of Secretary Shaun Donovan at the National American Indian Housing Council

Washington Court Hotel, Washington, DC
Wednesday, February 16, 2011

Thank you, Cheryl, for that warm welcome. 

I'd also like to thank both you and Mellor Willie for your work on behalf of the NAIHC. The Council is a remarkable organization that has fought, and continues to fight, for the housing needs of Indian Country. And as Secretary of the Federal agency that oversees housing policy, you have not just my gratitude, but my partnership.

I realize that a Federal agency offering you its partnership may be a new promise -- or rather, it may be an old promise that has not seen much follow-through. Because when it comes to Native American communities, we in the Federal government haven't always gotten it right.

But I'm here today because despite the word "urban" in our name, HUD has a real presence in Indian Country. And our work is reflective of a broader commitment by the Obama Administration to a new chapter in strengthening the government to government relationship, and establishing meaningful consultation in Native American housing policy, and Native American policy as a whole.

You can see that commitment in the Indian Veterans Housing Opportunity Act, which President Obama signed into law last fall, and which will help more Native American veterans receive access to affordable housing. You can see it in the President's signing of the Tribal Law and Order Act, which will help protect Native American women from violent crime and sexual assault. 

And you can see it in HUD's proposed 2012 budget. Not only does our budget build on this Administration's commitment to the nation to nation relationship, but it shows how, under President Obama's leadership, we want to win the future by working with partners like the NAIHC to support innovation, build strong, sustainable, inclusive neighborhoods that are connected to education and jobs, and provide access to opportunity for all Americans.

Of course, we won't win that future by building it on a mountain of debt. 

That's why HUD's budget also reflects the tough choices President Obama has asked all of us to make, as we work to put the country on a fiscally responsible path.

Winning the Future by Supporting Native American Housing

So, first, let me put this budget into a bit of context.

We cannot win the future by leaving Native American communities behind. That's why the Obama Administration made an unprecedented commitment to the housing needs of those communities through the Recovery Act. 

We invested more than half billion dollars in Recovery Act funding in the Native American Block Grant Program to fund new construction, acquisition, rehabilitation--including energy efficiency and conservation--and infrastructure development activities.

But as you know better than anyone, the Federal government alone can't be the answer -- we need to work closely with the tribes themselves to ensure that funding is implemented in ways that actually benefit the Native American families it is intended to serve.

That's why I'd like to congratulate the tribes for drawing down more than 62 percent of the funding putting them more than a year ahead of schedule.

It's an impressive accomplishment -- but even more impressive have been the results those funds have produced in Native American communities.

In Fiscal Year 2010, recipients developed more than 1,100 affordable housing units with Recovery Act funds, rehabilitated more than 8,600, and provided the infrastructure their communities need. And these funds have also made more than 18,000 "green" improvements to homes.

Those funds are making a difference across the country, as I've seen for myself. 

I've had the privilege of traveling to Indian Country three times since becoming HUD Secretary, and during my visit to South Dakota last August, I joined Senator Johnson to visit a Rosebud factory where they were using Recovery Act funds to build energy-efficient single-family homes.

Or take the Karuk Tribe Housing Authority in California, which used Recovery Act funds to rehabilitate 100 housing units and 63 apartment units, including the installation of low-E dual pane windows, energy efficient heat pumps, metal roofs and tankless water heaters.

And in Anchorage, Alaska, a local housing authority is developing a 59-unit housing complex for elders with the help of the Recovery Act. This complex is being constructed with high-efficiency insulation, heating units, and windows.

We know that HUD's investments in Native American communities have brought real benefits to families and tribes. Still, we know there's more work to be done to ensure that Native American communities, and Native American workers, can compete and win in the 21st century -- and I'm proud to say HUD's budget tackles these challenges head on.

Winning the Future by Taking Responsibility for Our Deficit

But before I go in to the strategic investments this budget makes, let me say a few words about how we are taking responsibility for our deficit.

The President has proposed a freeze on domestic spending for the next five years, cutting the deficit by $400 billion over 10 years and bringing non-security discretionary spending to the lowest share of the economy since President Eisenhower. 

Every department shares a responsibility to make tough cuts so there's room for investments to speed economic growth.

And HUD is no exception.

In a tight budgetary climate, we've had to make some difficult choices, including reductions to programs that, absent the fiscal situation, we would not cut. 

For example, the reduction to CDBG, which at 7.5 percent, is far less drastic than I think many anticipated.

But American families are tightening their belts -- and we need to do the same.

Winning the Future by Protecting Vital Investments in Indian Country

Despite this commitment to investing in what makes America stronger and cutting what doesn't, some will ask why we haven't cut our budget even deeper. 

Now, I respect those voices. But I also agree with President Obama that we cannot cut our budget on the backs of our most vulnerable citizens. 

And let's be clear: that is exactly what we would be doing if we cut even further.

Indeed, our 2012 budget is requesting $782 million to fund programs that respond to the severe, widespread housing and infrastructure needs in Indian Country.

I talked a moment ago about the Recovery Act's commitment to the Indian Housing Block Grant Program, which remains the single largest source of funding for Indian Country housing today. Our budget builds on that investment by requesting $700 million, and we anticipate that grantees will use nearly half of that funding to complete the construction, acquisition, and rehabilitation of over 4,400 single-family units and nearly 1,400 rental homes.

The remainder of the IHBG funding will support everything from down payment assistance to housing counseling, energy auditing, crime prevention, and the maintenance of nearly 50,000 low-income homes that were developed before IHBG was even implemented.

This funding will be supplemented by $10 million in Native Hawaiian Housing Block Grants, which in addition to developing 65 homes, will fund foreclosure prevention efforts and the promotion of responsible homeownership.

And our commitment goes beyond traditional affordable housing. To support the ability of Native American families to become responsible homeowners with market-rate financing, we fund the Section 184 program at $7 million, which we anticipate will support loan guarantee authority of nearly $480 million and will help 2,900 families either buy new homes, or upgrade the homes they already own. Although that represents a cut from last year's funding level, it comes in the context of major progress we've made in working with Ginnie Mae and the Federal Home Loan Bank of Chicago in opening their portfolios to purchase Section 184 loans.

And as HUD continues to expand our outreach by working with Community Development financial institutions and credit unions that serve Native American communities, I'm confident that we will increase access to borrowers at the grassroots level -- and that loan guarantee activity will continue to grow.

But the needs of Indian communities go beyond housing itself, and those communities need and deserve Federal support as they work to address their own development priorities. That's why HUD's budget includes $65 million for the ICDBG program -- level funding despite the overall cut to CDBG. Those funds will allow Native American communities to work toward solving urgent community development problems like blight or lack of housing options for low-income families.

These investments illustrate a central truth -- under the Obama Administration, our commitment to Indian Country will not flag, even in a context of tough fiscal choices.   The President is committed to building upon the nation to nation relationship he values--and I value--so much.

 Winning the future requires protecting some of our most vital priorities, as we help our communities prepare themselves for the 21st century economy with the support they need to grow and prosper. Indeed, HUD's overall investment in Native American programs will support over 6,000 jobs in areas where they are needed the most.          

Winning the Future by Transforming Tribal Communities

But generating that growth doesn't just mean direct support for communities -- it also means we need to spur the investments that will help build a stronger economy in those communities. 

Part of the solution for improving our economy--both in Tribal communities and throughout the country--is to encourage more sustainable communities.

Communities with more housing and transportation choices, located closer to jobs, shops and schools, will attract more private investment and talent and be the most globally competitive -- it's that simple.

That's why, last fall, HUD and the Department of Transportation awarded nearly $170 million in planning grants to ensure regions and communities across the country have more housing and transportation choices, more energy independence, and will be more economically competitive. 

Demand for our two new Sustainable Communities grant programs was phenomenal. And it didn't just come from central cities. More than half of applicants came from small towns and rural regions -- and winners included Tribal communities that featured innovative plans for sustainable growth.

Winners like the Apache/Navajo Counties Regional Sustainability Consortium of St. Johns, Arizona, which was awarded over $800,000 to fund a three-year regional planning effort to improve local economic conditions. 

Or the Spokane Tribe in Washington, which was awarded $1.5 million to plan mixed-income, mixed-use communities on the reservation that are energy-efficient and culturally-relevant, all while utilizing existing infrastructure. And to protect local wetlands, this funding will also help the reservation produce its first zoning code with input from tribal members. 

Those are only two examples of our Sustainability grantees -- grantees who come from 45 regions where 78 million Americans live. And despite that broad sweep, we were still only able to fund a quarter of the applications we received.

Our proposed FY12 budget helps meet the demand by requesting $150 million for additional Sustainable Communities grants.

These funds will create incentives for communities to develop comprehensive housing and transportation plans that spur jobs and reduce the combined cost of housing and transportation -- funded not by the Federal government, but by private investment. 

But we can't build sustainable Tribal communities if those communities face concentrated rural housing distress and community poverty.

That's why our budget requests $25 million for the Rural Innovation Fund to help tackle housing and poverty challenges in rural communities. That investment builds on and scales up the Rural Housing and Economic Development program or "RHED", increasing the maximum award RHED can provide from $300,000 to $2 million.

The Rural Innovation Fund not only sets aside $5 million for Native American tribes, but makes them eligible for broader funding by linking up with other partners to develop innovative proposals. And if the RHED program is any indication, our grantees will be able to leverage up to 10 times the capital HUD initially provides.

Planning our communities smarter means parents will spend less time driving and more time with their children.

More families will live in safe, stable communities near good schools and jobs. 

More kids in your communities will be healthy and fit. 

And more businesses in your communities will have access to the capital and talent they need to grow and prosper. 

Regions who embrace sustainable communities will have a built-in competitive edge in attracting jobs and private investment -- the investment so many Native American communities require to win the future.

Not only that, but by helping them use existing financial resources more strategically, these communities will be able to solve three or four problems with a single investment.

That is the new fiscal responsibility President Obama proposes in this budget -- and it's the kind of responsible approach communities are going to need to succeed in the 21st century.

These efforts recognize that one size doesn't fit all -- particularly in tribal communities, where creative, locally-focused thinking deserves to be rewarded, not limited by the silos Washington has operated in for too long.

Winning the Future by Reforming Government for the 21st Century

As these investments remind us, we need to reform government so that it's leaner, smarter, more transparent, and ready for the 21st century. 

That's why we continue to make it our focus to improve and simplify the way HUD works with other agencies -- and with communities at the local, regional, and tribal level. 

Of course, making smart, responsible choices depends on more than partnership -- it also requires quality information.

As you well know, the housing needs of Native American communities are not only profound -- they are profoundly unique. For example, we know that that in some Indian cultures, when housing is scarce we frequently see overcrowding -- extended families often double and triple up in housing, rather than let family members fend for themselves.

Our last comprehensive study found that there was a need for more than 90,000 affordable housing units in Indian Country -- and that was in 1996.

Indeed, any discussion of what Native American communities require must begin with a simple acknowledgement -- we don't know enough about the scope of the problem. That's why HUD is beginning a new, 2-year effort to study and document the extent of housing needs in Indian Country.

The results of that study will help us 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.

Winning the Future Starts at Home

With each of these efforts, the goal is the same: to better address need, to better protect the American taxpayer and to better partner with your communities so that we can meet the challenges ahead.

Ultimately, one of the great challenges of my tenure at HUD will be not only to help you emerge from the economic crisis -- but to help you emerge more resilient and competitive.

If we are going to meet the President's charge to win the future, my job is clear:

To be a better partner to you.  To engage in meaningful consultation. To honor our government to government relationship.

In Montana, I received a headdress and quilt from Leroy Spang, the president of the Northern Cheyenne Tribal Council. They now hang just outside my office as a reminder of the challenges Indian Country often faces.

These gifts remind me that, in all of these efforts, success won't be measured simply by what HUD does -- but whether we'll be able to become the Federal partner that Native American communities deserve -- and that's long overdue.

That's what this budget is about -- and I know this isn't the end of the conversation, but really the beginning.

Whether the issue is providing quality affordable housing for all families, helping transform distressed areas into communities of opportunity and hope, or taking responsibility for our deficits by doing more with less, I'm confident we can not only make progress with this budget -- but history.

Ensuring we do starts with the men and women on the front lines of our communities -- all of our communities. 

It starts with the leaders here today in this room. It starts with you.

Thank you for this opportunity. Thank you for everything you do. I look forward to continuing our work together in the weeks and months to come. 

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