Prepared Remarks of Secretary Shaun Donovan at the National Association for Latino Community Asset Builders National Conference
Mayflower Hotel, Washington, DC
Thank you, Raul, for that kind introduction, and for all that you do with NALCAB and the Resurrection Project.
Thanks to your leadership and that of Noel Poyo, NALCAB has done extraordinary work on behalf of Latino families, particularly in the wake of this economic crisis.
I'm proud to say that in the Obama Administration, HUD is your partner every step of the way.
And your work has never been more critical than it is right now.
This crisis touched the lives of every American family -- but with an unemployment rate of more than 11 percent and having seen median wealth fall by a staggering two-thirds between 2005 and 2009, let's be clear:
No one has been hit harder by this crisis than the Latino community.
To anyone who cares about an equitable, fair, and inclusive America, those statistics aren't just troubling.
They are completely unacceptable -- to me, to President Obama, to anyone who is working to lift up our families, rebuild our communities, and grow our economy.
Because as you know better than anyone, Latinos are critically important to the future of this country -- accounting for 65 percent of the Nation's population growth over the next 40 years and forming the backbone of America's labor force in the coming decades.
Indeed, as Noel has said, "so go Latinos, so goes the U.S. economy."
So today, I'd like to talk to you about what this Administration is doing to push back against the crisis for Latino families.
I want to discuss the partnerships we've forged with so many of you to rebuild Latino communities all across the country and forge pathways to opportunity for every American.
And I'd like to talk to you about the work that lies ahead to speed economic growth -- growth that will lay the foundation for the American economy and for Latinos in the 21st century.
Lifting Up Latino Families
Of course, our first challenge upon taking office was to stop the bleeding -- to extend a lifeline to our most vulnerable families during this crisis, while keeping middle-class families from losing any more ground in the aftermath of the worst economic collapse since the Great Depression.
To create jobs and put money back into the pockets of working families, President Obama enacted a series of new and expanded tax credits -- from a payroll tax cut to the Making Work Pay tax credit to an expansion of the Earned Income Tax Credit. Thanks to these tax credits, a typical family earning $30,000 per year has almost $4,000 extra dollars in their pockets.
To help people who had lost their jobs through no fault of their own, we expanded unemployment benefits for the long-term unemployed -- both through the Recovery Act and again in last December's tax deal.
To help vulnerable families put food on the table, we made new investments in federal child nutrition programs.
These changes alone kept 1.7 million children above the poverty line last year.
And using Recovery Act funds, we've renovated nearly 210,000 homes nationwide in communities of color.
Indeed, almost 30 percent of HUD's Recovery funds went to Congressional Hispanic Caucus and Congressional Black Caucus districts -- with our poorest areas receiving nearly 20 times the funding per capita than other neighborhoods.
I know you've heard some people refer to the Recovery Act as a "failed stimulus."
Well, tell that to the more than 1 million people the Recovery Act saved from homelessness since the beginning of the Administration.
That's a million people who won't be forced to sleep on our nation's streets, in their cars or double up at a relative's house. A million people--men, women and children--who can begin their lives again.
Or tell it to the six million Americans who the Recovery Act prevented from falling into poverty.
The result of these investments is clear -- despite the economic headwinds we are still facing, we've been able to protect low-income families and offered middle-class families the relief they desperately needed.
Of course, the immediate cause of the economic crisis was the housing collapse. And no community has been hit harder by that collapse than Latinos, who currently face a foreclosure rate of nearly 8 percent.
While it's clear we still need to do more to keep families in their homes, let's be clear:
Our efforts have made a real difference.
That starts with the 6 million families who have been assisted by HUD-approved housing counselors since President Obama took office.
According to NeighborWorks America, distressed homeowners working with a housing counselor are nearly twice as likely to receive a modification on their mortgage.
While some in Congress eliminated housing counseling last year, I'm proud to say that, with your help, we successfully fought to restore critical funding for housing counseling in the recent FY 2012 budget agreement -- a major victory for Latino families across the country trying to stay in their homes.
But counseling is only one part of this Administration's commitment to ensuring that families who need help get it.
Outrageously, before President Obama was inaugurated, the majority of loan modifications that banks and servicers were doing weren't making mortgage payments more affordable, but more expensive -- actually raising monthly payments on borrowers.
Well, because we pushed the banks to clean up their act, that's no longer the case. More than 5.3 million families have received restructured mortgages since April 2009 -- twice the number of foreclosures completed in that time. Families are saving over $300 per month on average. And foreclosure notices are down 45 percent since that time.
That's not all we're doing to get help to families during this crisis.
As you all know, we're pursuing a foreclosure settlement with state attorneys general in response to the revelations that banks were improperly foreclosing on some families -- using faulty documentation and fraudulent affidavits.
The notion that many of the very same institutions that helped cause this housing crisis may well have been making it worse is shameful.
I know some have suggested that the Administration wants to let the banks off the hook with this settlement.
Well, take it from me: the goal of this settlement isn't to help banks.
It's to help people.
And it's to provide that help not sometime in the future by which time it will be too late to help many of these families.
We need to help them now -- particularly those families who can't sell their home to get a new job because they owe more on their mortgage than their home is worth.
And once we get this settlement finalized, we will help them.
But we are not just waiting for the settlement to take more actions to extend that help. Indeed, last month the Federal Housing Finance Agency announced changes to help more families who are underwater refinance their mortgages.
Because of these changes, more borrowers will be able to take advantage of today's low mortgage rates, and we've eliminated barriers such as closing costs and fees that can cancel out the benefit of refinancing altogether.
And by creating more competition so that consumers can shop for the best rates, these changes will save homeowners on average $2,500 per year -- the equivalent of a pretty good-sized tax cut.
As I said at the outset of my remarks, Latino families lost two-thirds of their median income as a result of the economic crisis.
Particularly given how many of these families were just starting to enter the middle class after decades of hard work, that's an absolute tragedy.
Well, because of these efforts, Latino families will have a new opportunity to rebuild -- not just the wealth they lost, but their faith in an American Dream they've spent generations working for.
You deserve it -- and this Administration is committed to ensuring every family has that chance.
Revitalizing Latino Communities
But as this audience knows better than anyone, the economic crisis didn't just harm families -- it devastated communities.
That was particularly true for neighborhoods of color, many of which saw decades of gains wiped out in a matter of months -- particularly in cities like Phoenix and Las Vegas that were in so many ways "ground zero" for the housing crisis.
Indeed, in many Latino communities, families saw their home prices and property values collapse through no fault of their own -- watching the value of their homes fall by $5,000 to $10,000 simply because they live on a block with a foreclosure sign.
That's not right. And as the Obama Administration understood from the beginning, revitalizing those communities is key to spurring economic growth in the wake of the recession.
That's why, with the leadership of Assistant Secretary of Community Planning and Development Mercedes Marquez, HUD awarded $7 billion of Neighborhood Stabilization funding to hard-hit communities across the country -- funds that are on track to create nearly 90,000 jobs and address 95,000 vacant properties.
And it's why our fair housing partners investigated over 10,000 complaints of housing discrimination this past year alone, as we work to ensure that every neighborhood in America is open and inclusive.
Now, despite these efforts--saving 6 million Americans from poverty, 1 million from homelessness, and targeting Recovery dollars to the hard-hit communities of color--given the scope of the damage, I know some folks have wondered whether this Administration has done enough to rebuild Latino communities.
Well, just ask folks like Edmundo Hidalgo from Chicanos Por La Causa.
It was with his partnership that we awarded nearly $140 million to CPLC and the NALCAB National Consortium to revitalize neighborhoods in 8 states and the District of Columbia.
That award is not only substantial.
In fact, it represents the single largest federal grant given to a Latino network in history.
And you can see that commitment not just in that grant -- but in community after community.
You can see it in Hernando County, Florida, where our NSP investments have not only helped families like Sandy and Socorro Beiro move in to once-foreclosed homes in hard-hit places.
Just as importantly, they've helped keep construction workers on the job and given real estate agents the opportunity to show and sell homes once again.
You can see it in the La Puente community, a predominately Hispanic suburb outside Los Angeles, where these efforts have helped increase home prices by nearly 15 percent.
And you can see it with the innovative "First Look" partnership, where we're collaborating with NCLR and the Urban League to ensure Neighborhood Stabilization funds are strategically targeted to places with the greatest need.
These awards and partnerships recognize that for all the federal support HUD can give, it's partners like you who understand the situation on the ground -- who know which communities need the most help and, just as importantly, how resources can be used to get the most "bang for the buck" in our hardest-hit neighborhoods.
And those partnerships are producing results.
Three-quarters of communities across the country with targeted neighborhood stabilization investments have seen vacancy rates go down -- and two-thirds have seen home prices go up compared to surrounding communities.
In fact, even though CHC districts make up just 1 percent of congressional districts, they received almost 10 percent of NSP dollars. And 1 out every 6 households benefiting from acquisition, new housing construction, homeownership assistance, or rehabilitation in the first two rounds of NSP were Latino.
That's why I believe we're not just making a critical investment -- but forging a new kind of smart government that is responsive to the people.
And it's about time it was.
The Task Ahead
Of course, we will continue to tap into your expertise and commitment in the months to come.
In fact, we're already doing just that. Your dedication has not only helped us revitalize communities nationwide -- you've proven that you're capable of taking this kind of work to an even bigger scale.
And as we continue to grapple with the "overhang" of foreclosed properties, we need to think creatively about ways we can engage the nonprofit and "Third" sectors to dispose of this shadow inventory.
That's why with about a quarter of a million foreclosed properties owned by HUD and the GSEs, this August HUD joined with FHFA and Treasury to issue a "Request for Information" to generate new ideas for absorbing excess inventory and stabilizing prices.
We received an overwhelming response -- including from NALCAB, which has suggested we dispose of up to a quarter of this portfolio to non-profit housing developers who can use it to rebuild some of our hardest-hit communities.
Although we're still reviewing all the ideas we've received, I want you to know that we have heard you -- and in the coming months will develop a proposal to put the best ideas to work.
But as excited as we are about the potential for REO-to-Rental, the scope of the problem means we can't wait to tackle the challenges of revitalizing foreclosed properties and the neighborhoods that are forced to deal with them.
That's why President Obama proposed a new "Project Rebuild" as part of the American Jobs Act.
Building on our neighborhood stabilization efforts, Project Rebuild would create 200,000 jobs in communities across the country -- creating real opportunities for the nearly 3 million Latinos working in the construction industry.
And by allowing our local partners to redevelop not just homes, but commercial properties as well, Project Rebuild will attack blight and foreclosures from all sides -- revitalizing neighborhoods and providing the spark entrepreneurs need to start small businesses and create jobs.
Its inclusion in the American Jobs Act reflects President Obama's belief that rebuilding neighborhoods is essential to rebuilding our economy.
Unfortunately, a minority in the United States Senate has repeatedly voted to obstruct the bipartisan ideas in the American Jobs Act.
But as you all know--and as President Obama knows--we can't wait to help homeowners, rebuild our communities, and restore the American Dream for millions of Latino families.
The quarter-million Latino-owned small businesses that will receive tax cut benefits from the American Jobs Act can't wait.
The 25 million Latino workers who will see more money in their pockets from an extended payroll tax cut can't wait.
And the 1 million Latinos who have been out of work for more than 6 months and who will benefit from "Bridge to Work" Programs that address long-term unemployment?
They certainly can't wait either.
And they shouldn't have to -- not while we're still working to jumpstart our economic recovery.
Not while legislation that will offer desperately needed relief is sitting in front of Congress.
That's why we need your help.
All of you have deep connections with the families in your communities -- and you can let Congress know that passing the American Jobs Act is critical not just to their futures, but to the future we all want to share.
Keeping the Pressure On
Because this isn't just about a piece of legislation.
This isn't just about a bill on Capitol Hill.
It's about moving forward.
Not you, not me. But together.
All of us.
As I mentioned at the beginning of my remarks, no community has been hit as hard by the economic crisis as the Latino community.
Between the collapse in household wealth, the sudden spike in unemployment for families who want nothing more than a chance to earn an honest living, and the devastation foreclosures have inflicted on communities, for Latinos across the country this crisis has been more than an economic setback.
It's been a tragedy.
But it's not a tragedy you're prepared to accept. And it's not a tragedy President Obama and all of us who serve in his Administration intend to simply live with.
Latino families--and families of all races and backgrounds throughout the country--deserve better than that. They deserve to have access to good jobs, live in quality homes they can afford, and watch their kids grow up in safe, stable neighborhoods.
That's the future the Obama Administration is working to build.
But we can't do it alone. We need allies like you -- fighters, working every day in the trenches, for little money and less glory, to make that change real on the ground. In people's lives.
You've already done extraordinary work these last few years to drive that change in our communities. And I know you'll keep doing it in the weeks and months to come.
That's why I'm so proud to be your partner. Thank you all so much.
|Content Archived: February 23, 2017|