Prepared Remarks of Secretary Shaun Donovan at the United Neighborhood Centers of America Neighborhood Revitalization Conference

Renaissance Hotel, Washington, DC
Friday, August 3, 2012

Thank you, Ron -- for that very kind introduction. And thank you for your outstanding work lifting up communities in Chicago. Many thanks to UNCA and the Alliance for Children and Families alike for sponsoring this conference.

Thank you as well to everyone here today who represents the broader neighborhood revitalization movement. Whether you come from a housing authority or a counseling agency, a local non-profit or a national non-profit, let me simply say thank you for the remarkable work you've done these last few years.

I'm proud to represent an Administration that calls each and every one of you a partner.

Today, I want to speak a little about the central role neighborhood revitalization has played in our efforts to speed economic recovery -- and how we've begun to break down silos in Washington that for too long prevented the work you do in communities across the country from realizing its full potential.

I want to discuss how, by lifting up the model you provided for neighborhood revitalization, this Administration is fundamentally changing the way the Federal government partners with communities.

And most important of all, I want to explain how the Congressional Republican budget proposal puts all of this progress at risk -- and describe the very real danger we face should it become law.

Rebuilding Homes and Neighborhoods

I don't need to tell this audience what was on President Obama's plate when he took office.

Housing prices falling for 30 straight months, record levels of foreclosures month after month and neighborhoods on the brink of collapse -- many of which had finally turned a corner just a few years before thanks to your help.

In the face of each of these challenges, the Obama Administration acted -- and while there are still too many families struggling, the results are clear.

With the help of HUD-approved housing counselors who have assisted 8 million families since President Obama took office, foreclosure notices are half what they were in early 2009.

Through the Recovery Act alone, we saved nearly 7 million people from falling into poverty -- and more than 1.3 million from homelessness, the vast majority of whom were families with children.

And because we helped communities struggling with concentrated foreclosures, places with targeted neighborhood stabilization investments have seen vacancies fall -- and home prices rise.

In fact, the $7 billion we provided to communities through the Neighborhood Stabilization Program are on track not only to address 95,000 vacant and abandoned properties -- but also create nearly 90,000 jobs in the places that need them most.

With your help--and with these tools--we've pushed back.

Indeed, with his background as a community organizer, President Obama understood from the second he walked into the Oval Office that you couldn't rebuild homes and neighborhoods with a top-down, one-size-fits all approach -- but rather by identifying new ways the Federal government could support local solutions from the ground up.

But having done that community organizing in Chicago public housing, he also knew that fixing our poorest neighborhoods wasn't just a moral problem.

It's an economic problem as well -- with 1-in-5 kids living in poverty, that costing us $500 billion per year, every year, 4 percent of GDP.

Today we can predict a child's lifespan not by their education or by their parents' financial position -- but by where they grow up.

By their zip code.

And so, the question President Obama faced upon taking office wasn't whether to take this problem on -- but how.

He knew what you knew: that while the resources the Federal government provides have played a critical role in fighting poverty, when it comes to promoting opportunity in our poorest neighborhoods, the disconnected, one-size-fits-all federal approach of the last half century hasn't solved these problems -- but often deepened them.

This audience is all too familiar with the sight of rebuilt public housing surrounded by failing schools, plagued by rampant crime or even by other troubled housing -- rife with the kinds of lead hazards and asthma triggers that make kids sick.

As President Obama said, we couldn't treat the symptoms of poverty in isolation -- we needed a comprehensive approach.

The thing is, while that may be a new concept to the Federal government, it isn't new to you.

Long before this president took office, this audience recognized that a comprehensive approach based on partnership was essential.

That rebuilding educational opportunities for children trapped in poor neighborhoods was just as important as rebuilding the neighborhoods themselves.

That tackling problems like homelessness and long-term unemployment in these places was inextricably tied to families' ability to access health and workforce training services in those neighborhoods.

Perhaps most of all, you understood that when government does not act alone, but as a leader among private and non-profit partners, these goals don't just begin to take shape.

For the first time, they become achievable.

That's why the President formed the White House Neighborhood Revitalization Initiative. Bringing together five agencies across the Federal government, including HUD, the goal of the NRI is clear:

To support the work partners like you are doing to transform distressed neighborhoods into sustainable, mixed-income communities with the affordable housing, safe streets, and good schools every family needs.

At the center of this effort is Choice Neighborhoods, which as you know builds on the HOPE VI public housing revitalization program. Indeed, with the partnership of so many of you, HOPE VI created over 90,000 public housing units in healthy, mixed-income communities. It leveraged twice the federal investment in additional capital. And it raised the average income of residents by 75 percent or more.

That's success. And with Choice Neighborhoods, you'll be full partners in the transformation, using proven mixed-use, mixed-finance tools to build on that success -- revitalizing not just public housing, but all kinds of federally-supported housing in poor neighborhoods.

In the first two years alone, Choice Neighborhoods grants have leveraged $1.6 billion in additional capital--over 12 times the $130 million federal investment--to create new schools, park space and transit options, and improve public safety.

It's forged dozens of partnerships between not only housing authorities and owners of multifamily housing but also school districts, universities, police departments, and hospitals.

In Chicago, you can see this integrated approach in action. If you take the Green Line on the El south, at the last stop you'll see a forlorn neighborhood named Woodlawn just blocks from one of the world's greatest universities yet plagued for years by crime, poor schools, unemployment, and neglect.

With its $30 million Choice Neighborhoods grant, the city is partnering with Preservation of Affordable Housing, Inc. -- a non-profit working to transform Woodlawn into a mixed-income community with critical assets like grocery stores, a youth center, and improved access to public transportation.

By partnering with Hull House, the University of Chicago's Urban Education Institute, and the Woodlawn Children's Promise Community, the city is using its grant to build on local efforts to turn around poor performing schools and create "cradle to career" educational opportunities.

Woodlawn reminds us that the key to turning around America's poorest neighborhoods isn't a job the Federal government can do alone.

It reminds us, as you say, that we need to "rebuild neighborhoods with neighbors" -- with the people who know these places best.

Indeed, that is the approach we're taking with our new Rental Assistance Demonstration, which is helping owners of public housing tap their equity to make physical improvements to 60,000 public housing units -- and ensuring the mix of uses and incomes we know are essential to a healthy neighborhood.

And after extensive consultation over the past few years with key stakeholders--none more important than the residents themselves--just last week we published our final rule -- and the initial application period for the competition is scheduled to open the last week of September.

Obviously, this is just a demonstration. But having lost 150,000 homes from our nation's affordable housing stock in the last 15 years--and with an estimated $26 billion capital needs backlog facing our public housing program--it represents more than just a new way of preserving and improving affordable housing for future generations.

Taken together with Choice Neighborhoods, it also represents a sea change in how the Federal government partners with communities and the private sector to make it possible.

Strengthening Regional Competitiveness

Of course, this audience understands that the transformation of our neighborhoods and communities doesn't happen because of a federal grant alone.

It happens when stakeholders who have never worked with each other before start coming together to build consensus.

It happens when these partners work to secure and target funding from different sources -- and when they bring innovative, evidence-based solutions to complex problems like crime and underachieving schools.

Most importantly, it happens when that process is driven by the most important stakeholder of all:

The residents and members of the community.

That's one of the reasons we've engaged residents not only at the housing and neighborhood level -- but also to our work to strengthen the competitiveness of cities and regions upon which those neighborhoods depend.

It's no coincidence that the places 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.

And so in the earliest months of his Administration, President Obama created an unprecedented partnership between HUD, EPA and DOT to help launch a new wave of housing, zoning and land use reform to help communities work together to become more competitive as a region.

Indeed, the Partnership for Sustainable Communities recognizes that communities today aren't just competing against their neighbors -- but across the globe. And a big part of what allows places to win that competition and collaborate with other places that share an economic future is the way communities manage transportation, building and land use.

By helping neighboring communities work together to harmonize their rules and codes, the Partnership helps communities attract businesses to their regions and create jobs, enhancing regional competitiveness.

And at a moment when the fiscal environment has forced us to essentially flat fund our block grant programs--dollar for dollar, HUD's biggest job creators--the Partnership also uses taxpayer dollars smartly -- to leverage the private investment communities need to create jobs.

This Partnership also recognizes the critical role community development plays in attracting private investment -- and clearing barriers to it.

Each of you knows that what businesses want to see when they invest in your community is that the city has a plan in place and is putting money behind it.

They want to see the proper infrastructure coming online.

And here again, they want to know that the community and its residents have bought in and contributed to the plan. That's what HUD's sustainable communities grants make possible.

For instance, as I saw for myself this spring, by bringing stakeholders from all sectors to the table during the planning process, Memphis is planning to revitalize neighborhoods around its "Aerotropolis," giving companies like Electrolux and Mitsubishi the confidence they need to generate over 1,500 jobs with over $500 million of investment.

Pittsburgh's plans to revitalize the East Liberty neighborhood gave Google the confidence it needed to open 100,000 square feet of office space in an old Nabisco factory.

And on the Pine Ridge Indian Reservation in South Dakota, the Thunder Valley Community Development Corporation and the Oglala Lakota Tribe are using these tools to create the first economic development plan in the region's history.

Now, despite extraordinary demand, most of you probably know that Congress eliminated funding for HUD's grant program this year. And so, our first step to taking this Partnership to the next level is to restore that funding. And we need your help.

We also need to align our efforts even further. That starts with streamlining the application process Partnership grants and identifying other grant programs that can enhance its potential.

Building Our Cities' Capacity

Of course, this audience knows that no matter how big the federal grant or well crafted the policy, no city can compete without strong local leadership and institutional capacity.

And while a federal partner that understands the importance of local capacity to every community, it's absolutely essential for those places that were facing long-term structural challenges long before the recession hit.

That's why the platform we've created with the Strong Cities Strong Communities pilot is so important.

To six geographically and economically diverse cities and regions, SC2 is piloting two capacity-building tools -- from Community Solutions Teams comprised of highly skilled federal officials who are working on-site full-time to help these cities get the most out of the millions of federal dollars already awarded...to a Fellowship Placement Program funded by philanthropy that makes sure there is capacity within the local government to lead when the federal teams depart.

And just yesterday, as part of the Neighborhood Revitalization Initiative, the Department of Justice announced that two SC2 pilot cities--Fresno and Memphis--will receive assistance through the Building Neighborhood Capacity program -- ensuring that capacity exists at the neighborhood and municipal levels alike.

But SC2 is not just about cities facing long-term challenges. It also includes a National Resource Network that can act as a "one-stop-shop" for technical assistance to local governments across the nation. And for localities that have large deficits in their fiscal capacity, it features an Economic Visioning Challenge designed to help them develop and implement a comprehensive, 21^st century, globally competitive economic strategy for their region.

So, when President Obama says that an economy built to last requires everyone to get a fair shot, he's not just talking about families.

He's also talking about the communities where they live.

Housing and Communities Built to Last

Ultimately, whether it's SC2, the Partnership for Sustainable Communities, or Choice Neighborhoods, we've demonstrated what's possible when government is in the business of supporting local solutions.

Of supporting the work you do to create real access to opportunity -- to the good schools, safe streets, and decent jobs that every family needs. And for all the achievements I've mentioned, that may well be our single biggest so far.

Even still, you and I know that this is just a beginning -- a foothold for the kind of lasting change our communities need and that you've been fighting for.

To cement this change for the future, we need every dollar across government to be working together toward helping communities realize their own visions for success.

That's why I believe that the budget debate in Washington isn't about whether we create jobs faster, grow the economy or heal our communities.

It's how. It's whether we support communities' ability to work together to attract jobs -- or pit them against one other.

It's whether we open public housing to the local businesses and private sector partners who have a stake in preserving them for generations to come -- or shut those partners out.

It's whether we assist cities with tremendous assets but enormous capacity gaps -- or let them fend for themselves.

It's whether have a new Project Rebuild that builds on the success of NSP to create 200,000 jobs -- or allow the abandonment in these neighborhoods to spread.

But in many ways, the choice before us in the debate between the President's budget and the Congressional Republican budget is even simpler:

It's whether we return to the same top-down policies that got us into this economic crisis -- or build an economy based on local decision-making and a strong and secure middle class.

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

Those are the values I stand for, that you stand for, and that we all stand for as Americans -- and we need to reclaim them.

We need to fight for them.

With your partnership and commitment, I know we can-- and will. Thank you.

###