Prepared Remarks of Secretary Shaun Donovan at the National Association of Regional
Council's 2012 National Conference of Regions

Washington, D.C.
Tuesday, February 14, 2012

Thank you, Mayor Morrison, for that very kind introduction and for your leadership. Many thanks also to your Past President, State Senator Steve Cassano.

It's a pleasure to be back at NARC and to see so many local elected officials and members of leadership in regional planning organizations from around the country.

Well, this has been an extraordinary few weeks.

In his State of the Union address last month, you heard President Obama outline his vision for an economy built to last -- built on American manufacturing, American energy, skills for American workers, and a renewal of American values.

In that address, the President announced a new broad-based refinance plan for homeowners -- and an investigation into the conduct of financial servicers that broke the law and led to the crash of the housing market.

A few days later, not far from here in Falls Church, Virginia, I was in the audience as President Obama unveiled a Homeowner Bill of Rights -- a single, straightforward set of commonsense rules that families can count on when they buy a home and after they get the keys to their new home.

And, of course, last week, I was proud to stand with Attorney General Holder and a bipartisan coalition of attorneys general from 49 states as we announced a historic $25 billion mortgage servicing settlement on behalf of American homeowners.

The largest federal-state civil settlement ever agreed to--and the single largest pay-out by the banks so far--this agreement addresses foreclosure processing violations by the nation's five largest mortgage servicers and provides substantial and immediate financial relief to homeowners.

At the same time it requires banks to reduce the principal balance on at least 1 million loans, refinance loans for "underwater" borrowers, and pay billions of dollars to states and consumers, the settlement also establishes new homeowner protections for the future -- forcing the biggest banks to clean up their acts and fix the problems that led to so much devastation in your communities.

Taken together, these steps will not only help homeowners and our housing marketcontinue to heal from this crisis -- they will help your communities and your regional economies heal as well.

Of course, we know that as important as it is that we begin to turn the page on an era of recklessness that left so much damage in its wake -- it's only the first step.

Those on the frontlines know that addressing this crisis can't just be about helping communities today -- but also about planning for the challenges of tomorrow.

That's why the budget President Obama released this week is so important. Targeting scarce federal resources to the areas critical to growing the economy and restoring middle-class security, this budget invests in education and skills for American workers, in innovation and research and development, and in clean energy and infrastructure.

I'm proud HUD's budget does its part to meet the President's charge -- bringing private capital back to the housing market, keeping vulnerable families in their homes, continuing progress on our economic recovery, reforming government.

And nowhere is that charge clearer than our decision to once again invest $100 million in our Sustainable Communities planning grants.

We are restoring funding for this program.

You understand what these grants mean to your communities' economic future. And so does this Administration.

That's why HUD forged the historic Partnership for Sustainable Communities with the Department of Transportation and the Environmental Protection Agency three years ago -- joining the Federal government with local partners in taking a pragmatic, regional approach to problem solving that supports local leadership, local resources, and local innovation.

You understand that as our communities' economies become more and more interdependent, today the partners that are growing more important with each passing day are those in the regions where we live.

Whether it's bond ratings or the ability to attract businesses, workers and families, regional neighbors matter.

China doesn't distinguish between Detroit and Troy or LA and Orange County -- they see a single region, a single economy, a single competitor.

They know what you know:

That America's metropolitan areas are where 85 percent of jobs are located and more than 8-in-10 residents live.

That our metros produce over 80 percent of the nation's patents and exports, and generate 90 cents out of every dollar America produces.

So today, I want to talk about why sustainable communities hold the key to realizing the vision President Obama laid out in his State of the Union -- and how our Sustainable Communities grants are helping to create new jobs here in America.

I want to explain how they make the most of America's energy resources -- and how they give hard-working, responsible Americans a fair shot and ensure every community plays by the same set of rules.

Above all, I want to talk about why I believe--and President Obama believes--that sustainable communities are essential to creating an economy that isn't built on a house of cards, on phantom profits or on shady mortgage practices.

But rather an economy that's built to last.

Creating New Jobs Here in America

Now, everyone in this audience knows that an economy built to last is an economy built on jobs.

And on that front, we've made extremely important progress since President Obama was sworn into office.

Then, we were losing three-quarters of a million jobs every month.

Housing prices were in freefall -- for 30 months.

Foreclosures were surging to record levels month after month.

Since that time, more than 5.6 million families have received restructured mortgages to keep them in their homes.

Foreclosure notices are down -- nearly 50 percent since early 2009.

And most important of all, the economy has added private sector jobs for 23 straight months -- 3.7 million jobs in all.

With a resurgent auto industry leading the way, last year our economy added more private sector jobs than any year since 2005.

Critical to that progress has been the new way of doing business that the Partnership is supporting from the ground up.

Just look at the East Liberty neighborhood in Pittsburgh, where the expansion of Google has helped transform an old Nabisco plant along Penn Avenue into a mixed-use office and retail cornerstone.

When Google decided to expand, they didn't just throw a dart at a map. They saw East Liberty's proximity to the City's universities and talent.

But Google also knew something else:

That the neighborhood had been the focus of public reinvestment -- from the introduction of rapid transit, to the transformation of one of the nation's most troubled public housing developments, to a joint sustainability grant from HUD and DOT focused on improving housing and small business opportunities in the surrounding area.

As a result, Google is expanding from around 45,000 square feet to more than 100,000 square feet, taking up nearly all of the remaining office space in Larimer Bakery Square. And about half of Google employees in the $130 million project are graduates of local schools.

We've seen this story in community after community where we've made these investments.

In Memphis, where HUD's Community Challenge Grant has helped the city revitalize neighborhoods surrounding its international airport. Their integrated housing, transportation, economic development and workforce development strategy has helped FedEx create over 3,000 jobs, and is poised to create another 1,500 by attracting companies like Electrolux, Mitsubishi, and Nucor Steel.

Or in Indianapolis, where Kronos Incorporated is expanding to the PNC Tower in the heart of the city's downtown, bringing hundreds of jobs with them.

Why would a tech firm from Chelmsford, Massachusetts decide to open a branch in Indianapolis, Indiana?

Well, in part because Mayor Greg Ballard has used a DOT TIGER grant to build over 60 miles of new transportation infrastructure over just the last three years, transforming Indianapolis into one of the Midwest's most attractive business destinations. And with a comprehensive neighborhood redevelopment strategy supported by a HUD Community Challenge grant, the city will be able to continue to attract a workforce that is younger and better skilled.

In all, in just two years' time, HUD's Sustainable Communities planning grants have provided $270 million in upfront investment capital to communities and regions across the country -- ensuring that they are able to grow and compete in the 21st century global economy.

Making the Most of America's Energy Resources

At the same time sustainable communities are creating new jobs and encouraging companies to invest here in America, they are also helping make the most of America's energy resources -- which are becoming more valuable by the day to our families and businesses alike.

California alone expects an additional 7 million families will live in the state over the next four decades. That's 7 million more people on California's roads, using its water infrastructure and increasing demand for affordable housing.

Concerned about the potential loss of agricultural lands--an important economic anchor for the state--the rising cost of doing business and the demand for energy resources, the state challenged its regions to create their own blueprints for growth and reinvestment.

With four of the five regional blueprints funded by HUD, collectively they will help California businesses and families save 420 billion gallons of gas and put $3.2 trillion back into its economy each year.

Across the country, taxpayers are seeing how plans that HUD is funding can conserve resources and save them money.

Led by the business community, Chicago and its surrounding suburbs have adopted a plan that will save $1.5 billion in future infrastructure and strengthen their competitive advantage in the global marketplace.

With its population growing rapidly, Salt Lake City has found that they can save $4.3 billion in infrastructure costs if they focus development on their new transit system.

They know what you know:

That if we are going to continue our recovery, we can't afford to have moving products on our roads cost businesses five times as much wasted fuel and time as it did 25 years ago.

Our research shows that if every community had these tools to help them realize their visions for economic growth and sustainable prosperity, the country could save over 14 billion gallons of gas each year -- saving households about $1,500 annually and creating over 300,000 jobs each and every year.

That's why sustainable communities aren't only about bringing jobs and housing closer together so that people can spend less time stuck in traffic and more time with their families.

They're also about generating savings that put money in people's pockets -- and put people back to work.

Giving Americans a Fair Shot, Ensuring Communities Play By the Same Set of Rules

But as President Obama said in his State of the Union, the measure of our success isn't just how many jobs we create or dollars we save, as important as those goals obviously are.

It's also about whether we expand opportunity in this country.

It's no coincidence that the neighborhoods that faced the brunt of the economic crisis and had the highest foreclosure rates and the deepest job losses, were the most unsustainable -- with the least access to transportation, the most troubled schools and the least economic opportunity.

That's why for me--and for this President--these grants aren't just about planning.

They're about whether we're going to tell families who pay 52 cents out of every dollar they earn on housing and transportation that they're on their own -- or give them a fighting chance.

They're about whether we're going settle for a country where a shrinking number of people do really well, while more and more Americans barely get by -- or if we are going to build a nation where everyone gets a fair shot, where everyone does their fair share, and everyone plays by the same rules.

That's the kind of community Austin is building by linking its long-term regional transportation plan to 37 mixed-income communities near transit and job centers, with a $3.7 million grant from HUD as the catalyst.

Not only is Austin tying new workforce housing to a planned trucking and rail transportation hub near the airport that will employ 2,000 people -- just as importantly, they're also helping 3,000 family-run, small businesses expand by making that expansion contingent on hiring people put out of work by the recession.

And by doing the right thing for Austin families -- the city is also doing the smart thing for Austin's economy.

The city estimates that HUD's sustainable communities grant will help create at least 7,000 permanent jobs and thousands more in the construction sector -- generating an additional $1.1 billion of economic growth over the next five years and saving the taxpayer $1.25 billion.

But it's not only individual Americans that need a fair shot -- every community does as well, whether they're inner-ring suburbs, rural farming towns or tribal lands.

Over 40 percent of HUD Sustainable Communities Grants have been awarded to smaller regions and rural places with less than 50,000 people -- from central Florida, to Appalachian communities in western North Carolina to Native American tribes in Wisconsin, Montana, South Dakota, and Arizona.

Some have asked, "Why does the Federal government need to be involved in this work?"

Well, let me tell you about Ranson, West Virginia--population 4,000--where economic decline has devastated more than a third of jobs in the local economy over the last decade.

Ranson is using a HUD sustainability grant to partner with neighboring Charles Town--population 4,300--to reverse that decline and creates its own vision for a sustainable economic future. In fact, with DOT TIGER II grants and funding from EPA to recycle contaminated Brownfield sites, the community is already in the process of creating a high-tech commerce corridor that includes housing, office space and community parks and recreational opportunity for families.

Or the Pine Ridge Indian Reservation in South Dakota, where the unemployment rate is 47 percent. Half of all people don't have a job. On the entire 3,400 square mile reservation, there is one grocery store.

One. And not a single bank.

Little wonder that 80 cents out of every dollar tribal families have leaves the reservation -- and so do many families.

With support from HUD's Sustainable Communities Regional Planning Grant program, the Thunder Valley Community Development Corporation and the Oglala Lakota Tribe are developing the region's first economic development plan, including identifying sectors that could be competitive in the regional economy, increasing job training, especially for young people, and streamlining business regulations to enhance access to capital.

Indeed, for regional partners to work together, communities have to play by the same rules.

That's because, whether it's Pine Ridge, South Dakota or Memphis, Tennessee, mobility of capital and people means in the 21st century communities aren't just competing against their regional neighbors. They face competitors from across the country and the globe.

A big part of what allows communities to win that competition and collaborate with other places that share an economic future is their regulatory structures, from taxes to land use.

And when it comes to the way communities manage transportation, building and land use, it isn't always federal barriers that get in the way, but often that every community in a region has a different set of rules and codes.

And for regenerating regions, this is particularly true -- especially those which rely on integrated supply chains that cross national borders and are essential to meeting the President's charge to double U.S. exports over the next five years.

That is why helping communities launch a new wave of transportation zoning, building code, and land use reform that responds to their unique needs and assets ought not to be just a local or regional priority.

But a national priority.

That's precisely why these tools can't just be available to those who receive our grants -- not when funding has far outstripped demand.

In fact, over the last two years, we have been inundated with applications for these grants from every state. In all, we received over 1,500 applications, but were only able to fund about 150 of them -- 40 of which went to your members.

And so today, I'm proud to announce that we are launching a Sustainable Communities Resource Center that will stretch the economic impact of these funds even further.

Showcasing successful ways that other places around the country are repositioning themselves to attract business and talent, this online one-stop-shop will be where you can find proven strategies, toolkits, data, and cutting edge research on everything from creating more housing and transportation choices, to reducing energy costs in buildings and homes, to improving public health and safety through community design.

An Economy Built to Last

Now, I know many of you were disappointed when funding for our Sustainable Communities grants was eliminated in last year's budget agreement.

I was disappointed as well.

And with the $100 million we have proposed in this budget, I can assure you: we are going to fight to get those grants back.

But it's just not just about how hard we fight.

It's also about the case we make.

As one of our grantees told us, "For the first time, in a long time, someone at the Federal government actually cares."

That wasn't a Democrat who said that -- it was a conservative Republican Mayor from the Midwest.

For him, these grants aren't about someone in Washington telling him what to do.

They're about having a partner in Washington that's actually asking, "What can we do to help?" -- and actually providing him with that help when he tells them.

For him, these grants are about having a partner that can help him bring all the stakeholders he needs to the table to realize his vision for economic growth -- from business leaders, to community leaders, to local elected leaders.

They're about creating an economy built to last -- built not by Washington but by the citizens and businesses of his community.

And so, we need you to do your part -- to tell your story and remind your Members of Congress that these grants and these efforts aren't about government that's big or small.

They're about government that's smart.

That's what this effort is about -- and it's why I've been so proud to partner with so many of you on it.

So, thank you -- for this opportunity and for everything you do to make your communities and your regions strong.


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