HUD 2002 Budget News Conference
Remarks by Secretary Mel Martinez
Monday, April 9, 2001
TRANSCRIPT OF THE PROCEEDINGS:
SECRETARY MARTINEZ: Good morning. I'm happy
to talk to you today about the HUD budget. First of all, I want
to tell you that it is a compassionate and responsible budget, and
one that I'm very happy to give you some details on today. Our budget
is going to focus on serving people, not programs. And that's why
I have with me today, some of the very people that we're gong to
be serving through this budget.
We have the Spencer and the Williams families with us today, who
are part of Habitat for Humanity's efforts to bring home ownership
to yet more and more Americans. And they have a special significance
to me, because we worked -- a few of us worked on their house, each
of their houses here in Washington a couple of weeks ago. It was
part of the Senate Build.
And I still - we were commenting earlier, we still
have mud in our boots from the day that we had fun putting this
home together for this family and lending a hand in what is part
of that dream of home ownership in America.
But our budget increases the funding that we will
give to Habitat for Humanity this year, which will make that dream
of home ownership available to yet even more Americans.
And the issue of home ownership is big in our budget,
because that is at the heart of what we believe creates better communities
and better neighborhoods.
I'm reminiscing about a few days ago, a week or so
ago, when I was in Mount Vernon, New York, and the comments that
Mayor Davis was saying. We had been to the Brown's family, new home
owners in that community. And Mayor Davis was talking about how
when you make a home owner out of a citizen, how they become better
citizens, how they become a more contributing part of the community
and a better part of the community. So, that's why home ownership
is at the heart of what we believe is so important in this budget.
And to make more home owners in our communities around
America, we have several initiatives. One is the Renewing the Dream
Tax Credit, which we hope will provide 100,000 new homes - either
new homes or refurbished homes - to low-income areas around America.
The second one is the American Dream Down Payment
Fund. And this is a $1 billion over 5 years that we hope will create
650,000 new homeowners around our country.
The CDBG - Community Development Block Grants, which
are the life blood to local governments - and let me assure you
that I come from that world, and I know how important these are
to communities - those are fully funded this year.
But in addition to fully funding the CDBG program,
we have a new wrinkle in it, which I think is going to be very positive
for so many of our communities. We have the creation and the expansion
of technology centers, which either will be springing up new, or
will be expanded from what they have been in the past.
And these technology centers will ensure and help
to make sure that those in our low-income areas of our communities
are not left behind by the digital advances that we're making in
our world, so that the youngsters like the Williams and Spencer
youngsters here will me today, will have an opportunity to learn
the skills that are necessary to be successful in the world of tomorrow.
One other initiative in this budget that I'm very
excited about, is the raising by 25 percent of the FHA multifamily
loan limit. This will enable us, for the first time in nine years,
by the way, that this limit has been raised, to spur multifamily
This is something that is really necessary in order
for more and more families, who cannot yet afford the dream of home
ownership as the Spencer and Williams have been able to do or will
do very shortly, to have a place, a decent place where they can
So, multifamily construction is very important. For
the first time in nine years, the FHA loan limits will be raised.
This is important, because between the rising land cost and the
ever-increasing cost of construction, multifamily construction has,
particularly in low-income areas, come to a virtual standstill.
So, this is a very important new initiative. Between
these two initiatives of home ownership and multifamily ownership,
we're combining to help many, many more new families across the
country achieve the dream of home ownership, or achieve the dream
of a better place in which to live.
We also, in this budget, renew all expiring contracts
to continue rental assistance to over 2.8 million families currently
receiving Section 8 assistance. And it includes $197 million for
34,000 new housing vouchers.
However, no matter how many vouchers we have, and
how many computers we might put into neighborhoods, hope comes with
the armies of compassion, and the assistance of community faith
groups, like Habitat for Humanity that we've highlighted here today.
When I visited Philadelphia recently, I remember going
around with some of the people there who are reinvigorating that
city in so many ways. And these are the folks that are working in
these faith-based communities, faith-based efforts.
Our budget increases the commitment this agency will
make to that effort. We will be the lead agency for these faith-based
initiatives, where we will have the resources funded within our
budget to ensure that this initiative gets off to the wonderful
start that we all hope it will have.
We also reach out to protect Americans who have special
needs. We have put an additional $20 million, for a total of $277
million, to house 3,700 more people with AIDS, expanding the number
of eligible jurisdictions based on projections of AIDS cases by
the Center for Disease Control.
We're also making allowances for those in our communities
who have challenges when it comes to accessibility because of physical
disabilities. And there will be 200 additional facilities accessible
to the disabled, as a result of this budget.
And finally, the budget also refocuses HUD and its
core mission and ends some programs that are duplicative. It terminates
the Public Housing Drug Elimination, and also the Rural Housing
and Economic Development Program. Both of these programs, without
a doubt, are duplicative and really beyond the scope of HUD's core
The budget also reduces the Public Housing Capital
Fund by $700 million. And this is simply due to the fact that there's
a surplus of unobligated funds. It makes little sense to give money
where it hasn't been spent, just to add to the total funds that
have been accumulated and unspent.
There will be no roof that will go unrepaired, and
there will be no modernization that will not take place in any of
our housing projects throughout the country because of this cut.
It will simply mean that the accrual that has been accumulated,
will not be increased by $700 million.
So, I think that kind of covers the highlights. But
let me just say that as we talk about home ownership, it isn't something
that is artificial, or new to me. I can still remember the smile
in my parents' faces, and the happiness in our home when we purchased
our first home in America. It wasn't all that long ago - 1968, actually.
It seems like just the other day.
I was 19 or 20 at the time, so there's a little water
under the bridge since then. But I can still remember that joy,
and that wonderful opportunity which we hope to bring to so many
more American families in this coming year through this budget.
So, I'll take a few of your questions, and then there
will be some budget experts to get into some fine details. Yes?
Q: Yes, Mr. Secretary. There's some growing
evidence around the country that - excuse me - that Section 8 voucher
holders are having a more difficult time using their vouchers, for
a variety of reasons. And I was wondering if you were planning to
take any steps to help them do that in these communities by raising
fair market rents, or taking some other steps?
Or alternatively, did you consider not funding new
vouchers, and maybe using that money for some other area, like public
SECRETARY MARTINEZ: You know, I think without
a doubt, that there is an issue there. We need to spur more construction
of multifamily which will be available to folks with Section 8 vouchers.
That's why the FHA loan limit increase is a very important one.
I'll tell you something else that is important. And
it doesn't have to do with budget, because everything about improving
people's lives doesn't have to do with how much more money you spend
at the federal government.
But we at HUD need to be more responsive to local
developers that are seeking to build multifamily housing. You know,
I know in central Florida, affordable housing construction has virtually
stopped. And a lot of that has to do, not because of a lack of funds,
or a lack of budget monies. It has to do because HUD is too difficult
to deal with. And it takes too long, and it's unresponsive.
So as we become a more proactive agency, and engage
with the development community, we might spur more construction
of multifamily housing.
But in addition to that, we are looking to what else
we can do administratively here, to increase the minimal rental
or other proactive measures like that, that might help folks who
have vouchers but cannot find a suitable place.
I know that very well. I mean, this is not something
that is isolated to any one
part of our country. It really is around the nation, and it's a
Q: The Section 8 FMRs - the proposed FMRs are
supposed to come out in April.
Are you trying to accelerate when those will be used? Will they
be used immediately on that?
SECRETARY MARTINEZ: We're trying to cut through
that, and I am not sure
that I can meet that April deadline. But I think that we are moving
quickly to try
to be responsive.
We know there's a tremendous need, and we know it's
a serious problem. And we're trying to be responsive to that. Yes?
Q: One of the problems that I see is in the
self-employed individual. The entrepreneurs are out there - that
their bottom line might be $10,000 of income. Therefore, they will
not qualify, because they don't have the trajectory as far as income
is concerned, because they are self- employed.
Are there any things that can be done for them?
SECRETARY MARTINEZ: Well, we're working - you
know, the American Dream Down Payment Fund is going to help many
people to be able to get a down payment to become home owners.
However, there are still going to be barriers to home
ownership that have to do with the availability of credit. You know,
we are proactively looking at predatory lending issues. We're looking
at what else we can do to facilitate the whole range of things that
must take place in order for someone to become home owners, particularly
also, frankly, home ownership education.
I know that Habitat takes care of helping these good people up here
to become homeowners. It takes knowing, you know, how to care for
a home, how to create wealth, how to put together the money for
the payment every month. Things like that.
So there's a whole range of things that we need to
look at in hopes of helping more people.
FEMALE SPEAKER: Because they may qualify with
a down payment with help. But if they don't have the income previously,
there's nothing we can help. The guidelines need to be adjusted
in order to fit certain people that cannot prove that they did have
an income in the previous two years.
SECRETARY MARTINEZ: Well, you're saying because
they were self-employed and could not prove the income?
Well, these are issues that I don't think I can do
too much about. But I think as we work through these things with
lending agencies, that we ought to try to be helpful to them in
any way that we can. I'm not sure that from a budgetary or from
the Secretary's office standpoint, there is too much I can do about
But I think it is a legitimate issue, and I'm sure
we'll follow up on it and see if we can do something with that.
Q: I was wondering, about that Capital Fund
and some of the funds that are not used right now, that some of
what I've been hearing and reading, is that it takes such a long
time for the funds to get released from HUD. And I'm wondering if
the Department's looking at ways to move that.
SECRETARY MARTINEZ: Right. Absolutely we are.
We're going to be much more responsive in seeing that those funds
are released more timely.
But even accounting for that, by the way, there's
still accrued funds that are unused and untapped. So we're definitely
looking at how we can be at HUD more responsive in releasing the
funds more quickly.
But there still are substantial funds that would be
unobligated. Take one more. Yes?
Q: The Renewing the Dream Tax Credit - is that
tax credit going to be made available to consumers who agree to
purchase a home and rehabilitate it in a low-income neighborhood,
or is that tax credit available to developers?
SECRETARY MARTINEZ: Just to developers. Just
to developers, to assist them in the development of these homes.
Let me take one more.
Q: Can you speak a little bit to what will
fill in the gap with the Drug Elimination Program .
SECRETARY MARTINEZ: Well, first of all, let
me say that the drug elimination was $309 million. $150 million
of that is going to still be a grant to the housing authority.
So, it's not going away. It's just going to be given
to them as part of the Public Housing Assistant Operating Fund.
They can then determine what are their highest priorities
for the use of those funds. It might be for drugs, but it may be,
in other places where they don't have a drug issue, it may be in
elderly housing, or something like that, they can use it for other
So it eliminates the necessity that it must only be
used for drug elimination type programs. Although in fact, there
have been programs that have fallen far afield from that. So I think,
with $150 million, they'll be able to fund their highest priorities,
and at the same time, we will be doing away with a duplicative program.
SECRETARY MARTINEZ: Well, let me say. The President
has a commitment of $19 billion to the effort against drugs. And
so, the Department of Justice, the drug czar's office, and every
other tentacle of the federal bureaucracy and local law enforcement
as well, will all be working on the drug issue.
And, you know, when you look at HUD's mission of providing
housing, I'm not sure that law enforcement really falls very well
under that category for us.
Well, thank you very much. I'll take one last.
Q: The dollars from the CDBG Special Programs
projects - do you realistically expect Congress not to appropriate
some programs this year?
SECRETARY MARTINEZ: Well, you know. We - what
did the President say? We propose, and the Congress disposes. And
I think that's probably a good note to end on.
This is the President's budget. Comprehensively, it's
a good budget. As I said at the beginning, it's a compassionate
budget and also a responsible budget.
The rate of growth throughout the federal government
of 4 percent we think is very prudent. Our growth is going to be
about 6.8 percent, almost 7 percent. And with that, I will leave
it with the experts, and thank you very much. I appreciate it. Thank
Additional Proceedings of the Press Conference
Content Archived: March 11, 2010