PREPARED REMARKS FOR
ROY BERNARDI, DEPUTY SECRETARY OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, DC
WEDNESDAY, JUNE 25, 2008

Thank you. I just wanted to come here and speak for a moment about our policy direction.

I know there are other people from HUD who will provide an in-depth briefing on such matters as multi-family issues, housing vouchers, PIH audits, and the Violence Against Women requirements.

My job is to give an brief overview and to present the Washington Update Scholarship Award.

Affordable multifamily rental housing is a national priority and must remain so. We know it is vital for millions of people. The largest component of HUD's budget is for affordable housing. You might say that we are in the "affordable housing business."

And, as a former mayor, I know that our cities must include people of all incomes and backgrounds.

In a recent publication, Christian de Duve, the Belgian researcher who won the Noble Prize for Medicine, predicts the fate of our cities in fifty years. He has a sad vision of mega-cities overpopulated, straining under enormous pressures of growth and resource management. In his view, fifty years from now, our cities will have a fortunate few who live in comfort and a majority who live in a state of nature, fighting and competing for food, housing, and other staples.

This sounds like a science fiction movie, but in some parts of the world, we can see these difficulties now, today, not in some distant, dismal future.

In this country, we must not let this happen in our cities, now or later. Our cities must represent all of America, not just the well-off or the well-placed. From New York to Los Angeles, Billings to Biloxi, those with limited means must have their place in the city, too. Our cities cannot become exclusive communities of the rich…havens of wealth and privilege. We cannot allow people with lower incomes to be disregarded and eliminated.
We must not let millions of Americans be priced out, moved on, and then shipped off.

Affordable multifamily housing is where many of our teachers, firefighters, nurses, policemen, and service workers grow together, and even grow old together. Our cities are great only if they are diverse: open to people from all races, classes, and incomes. And they are great cities only if those who work in the city have the opportunity to live in the city. This is how a city becomes a community, where we interact with each other in business and recreationally.

Let me put it to you another way. Twenty-five hundred years ago, Pericles of Athens, maybe the greatest major, said that "All good things come to the city because of the city's greatness." Well, if a city repels or rejects those who serve it, the city will never be good, much less great. So, for the sake of our citizens and for the good of our cities, we must use our public and private partnerships to increase the development and preservation of affordable multifamily housing. And we must examine all available information on the need for multifamily affordable housing.

It is unacceptable that so many hard-working families are still struggling to find homes or apartments within their budgets.

It is unacceptable that so many people are forced to commute long distances, or live in sub-standard housing, or reside in over-crowded conditions.

Now, I realize that for most people the American Dream is about homeownership. But homeownership is neither wanted by every person, nor affordable for everyone. There is an obvious demand to keep the affordable rental market we have - and expand it.

That means renovating affordable housing, whenever possible.

That means building affordable housing, whenever practical.

That means opening up current non-rental properties as affordable housing, whenever workable.

There are powerful economic forces that threaten affordable rental housing. But there are places where we can take a stand. Recently, I participated in efforts to preserve Starrett City, our nation's largest affordable housing complex. There were those who wanted to convert it, gentrify it. As a result, hundreds, if not thousands, of residents would have lost their apartments because they could no longer afford to live there. And, in New York City, a strained affordable housing market would have experienced even more shortages.

But Starrett City was saved. And this happened because a bipartisan coalition of people came together - Representative Ed Towns, Attorney General Andrew Cuomo, Senator Chuck Schumer, and we in the Administration all joined forces.

I was pleased that we could identify substantial common ground on affordable housing. Recently, as Acting Secretary, I signed a Memorandum of Understanding outlining the guidelines for any future purchase of Starrett City. I wanted to make sure that no one sold those affordable housing units out from under the people living there.
I believe Starrett City shows what we can all do, together, both parties, all parties, working to maintain and expand affordable housing.

I hope that the spirit of Starrett City lingers and moves us to further actions.

There are also commonsense things we can do. All across the country we see burdensome regulations, excessive fees, and out-of-date building codes as barriers to affordable housing. Development is often expensive, and that expense is passed on to the renter or homebuyer. HUD studies show that excessive regulations can increase the cost of housing by 35 percent - maybe more!

In this century, our citizens expect us to do better. They want a modern, efficient, compassionate, and effective government response. In a computerized, digital, virtual age, people expect the government to be pro-active and ahead of the curve, not reactive and lingering behind, buried in bureaucracy.

So HUD created an effort called "America's Affordable Community Initiative." We did this in 2003. The program is working with state and local governments to cut red tape and reduce regulatory barriers. In fact, over 120 communities have heard this call for action and are taking steps to remove excessive and burdensome regulations.

This is a very promising effort. But the key thing is that government must work harder to catch up and then get ahead. We must be leaders in innovation and responsiveness, educating our citizens about new and better services. We need to do all that and more. In the latest budget, the Administration offers some good ideas for expanding affordable housing availability.

For example, the HOME Investment Partnerships Program is one of our most successful efforts. Since 1992, more than 600 communities have built almost 820,000 affordable housing units. The President has asked Congress for almost $2 billion for the HOME Program in the coming fiscal year. These funds would help finance land acquisition, new construction, rehabilitation, down payment opportunities, and rental assistance.

Another effort is HUD's Housing Choice Voucher Program, which is providing approximately two million low-income families with subsidies to obtain affordable housing. This is a substantial national commitment. The President has asked Congress for $16 billion in the next fiscal year, coupled with some changes in the program that would allow for housing authorities to assist even more families.

The President also wants to make sure that housing tax credits are preserved. Each year, housing tax credits produce about 140,000 affordable units. Since its inception, tax credits have funded more than 2 million affordable units of housing.

HUD will also continue its successful implementation of the Public Housing Capital Fund Financing Program. As you know, this program allows public housing authorities to borrow from banks or issue bonds using future Capital Fund grants as collateral or debt service. In this way, the Public Housing Authorities can leverage their Capital Funds to make home improvements. The President's FY 2009 Budget request is at just over $2 billion.

The FY 2009 Budget request for the Public Housing Operating Fund is the highest funding request in the history of HUD, a $4.3 billion request.

In total, the President's FY 2009 Budget request to support our Office of Public and Indian Housing is $23 billion. This would support nearly 4.8 million rental housing units through public housing.

We also seek $7.4 billion for Project-Based Rental Assistance administered by HUD's Office of Housing.

I know that these funds will make a difference. As Mayor of Syracuse and now as Deputy Secretary of HUD, I've talked to thousands of tenants, property managers, owners, lenders, government officials, advocacy groups, and service providers. Like most of you, I've walked miles of hallways, been invited into many apartments, smelled a lot of home cooking, and worked the pathways of government to help people with limited means find a home.

I've done this because our cities must have safe, secure, healthy, and respectful affordable housing.

We all work to promote and protect affordable housing because it is the right thing to do.

Affordable housing is a measurement of what we can do together. Our cities can be great places to live, safe and secure, culturally thriving, places of community and beauty.

Here, together, let's make a passionate - compassionate -- national commitment to affordable housing even better.

Thank you.

###