September 4, 2001
Millennial Housing Commission
800 North Capitol Street, N.W., Suite 680
Washington, D.C. 20002
Re:
614 Grand Avenue, Suite 320
Oakland, California 94610
Telephone: 510-251-9400
Fax: 510-451-2300
nhlp@nhlp.org
www.nhlp.org
Additional Comments on the HOPE VI Public Housing Grant Program
Dear Commission Members:
The National Housing Law Project (NHLP) is a housing law and policy center whose
mission is to preserve and enhance the country’s supply of affordable housing. In July of
this year, NHLP submitted written comments to the Millennial Housing Commission in
response to the Commission’s April solicitation letter. We now submit these additional
comments on the HOPE VI public housing grant program.
Summary
The HOPE VI Program provides millions of dollars in federal grants that all too often are
used in ways that fail to provide real solutions for severely distressed public housing
developments. As it is currently administered, the HOPE VI Program exacerbates the
nation’s affordable housing shortage and funds the construction of new housing from
which current public housing families are largely excluded. Funding for the HOPE VI
Program comes at the expense of basic maintenance for the public housing program
overall. We urge the Millennial Housing Commission to do what HUD has not done:
conduct an objective, comprehensive assessment of the HOPE VI Program to determine
how better results can be achieved.
The HOPE VI Program
The HOPE VI Program was launched in 1993 to address the problem of severely
distressed federal public housing developments. The federal public housing program
provides affordable homes to over 1 million families across the country. Public housing
developments are owned and managed by local governmental agencies, known as public
housing authorities, with funding from the federal government. A 1992 report from the
National Commission on Severely Distressed Public Housing concluded that an estimated
6 percent of the county’s public housing, equal to 86,000 units, were severely distressed.1
1
See National Commission on Severely Distressed Public Housing, The Final Report of the National
Commission on Severely Distressed Public Housing: A Report to the Congress and the Secretary of
Housing and Urban Development at 2 (Aug. 1992).
Washington Office
1012 Fourteenth Street, NW, Suite 610 · Washington, DC 20005 · Telephone: 202-347-8775 · Fax: 202-347-8776 ·
nhlp@nhlp.org · www.nhlp.org
Millennial Housing Commission
July 11, 2016
Page 2 of 5
The HOPE VI Program was created to provide funding to local public housing authorities
to demolish or “revitalize” the most deteriorated public housing developments. HOPE VI
grants are awarded annually on a competitive basis, with public housing authorities and
their partners submitting funding applications to the U.S. Department of Housing and
Urban Development (HUD). Over the past eight years, HUD has distributed $4 billion in
HOPE VI grants for approximately 149 public housing developments in 90 cities.
The HOPE VI Program Exacerbates the Nation’s Affordable Housing Shortage
The nation has far less affordable housing than it needs. According to a HUD report
published earlier this year, for every 100 very low income2 renter households in 1999,
there were only 70 units affordable and actually available to them.3 The situation is even
worse for extremely low income4 renter households, with only 40 units affordable and
available for every 100 households in this income group.5 According to HUD figures, 57
percent of public housing households are extremely low income; 20 percent are very low
income.6
In light of this scarcity, the federal public housing stock is a precious national resource.
While other housing programs, such as the Low Income Housing Tax Credit Program,
are designed to provide housing only for households at certain income levels, public
housing provides opportunities for affordable homes for families of a wide range of
incomes. Public housing is guaranteed affordable housing, with rents in most situations
set at 30 percent of a family’s household income. But, public housing is also a limited
resource. No significant amount of federal public or assisted multifamily housing has
been constructed since the early 1980s.7
Increasingly, there are indications that the nation’s limited public housing resources are
being stretched beyond capacity. Across the county, waiting times on waiting lists
operated by public housing authorities have grown dramatically. On average, families
must wait almost a year for a public housing units. In larger metropolitan areas, public
housing waits range from almost three to eight years.8 From 1998 to 1999, the number of
families on waiting lists that were not closed due to their overwhelming size increased
between 10 and 25 percent.9
“Very low income” is defined as between 30 and 50 percent of area median income.
See HUD, A Report on Worst Case Housing Needs in 1999: New Opportunity Amid Continuing
Challenges at 8-9 (Jan. 2001) available on-line at http://www.huduser.org/publications/affhsg/wc99.pdf.
4
“Extremely low income” is defined as at or below 30 percent of area median income.
5
See id at 9.
6
See Multifamily Tenant Characteristics System (May 2001), available on-line at
http://www.hud.gov/mtcs/public/guest.cfm.
7
See Cushing Dolbeare, National Low Income Housing Coalition, Changing Priorities: The Federal
Budget and Housing Assistance 1976-2000 (2001).
8
See HUD, Waiting in Vain: Update on American’s Rental Housing Crisis (Mar. 1999).
9
See id.
2
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Millennial Housing Commission
July 11, 2016
Page 3 of 5
The HOPE VI Program is making a bad situation worse. On average, the HOPE VI
Program provides funding for the demolition of 11,000 units of public housing each year.
Approximately half the time, this demolition is done in conjunction with the construction
of new “revitalization” housing. In the other half, homes are demolished without the
construction of any new housing. According to a study conducted by NHLP, even when
new units are constructed under the HOPE VI Program, the number of rental public
housing units on the HOPE VI site is reduced on average by 55 percent.10
Public Housing Residents Are Being Excluded from New HOPE VI Housing
As a result of the reductions in the number of public housing units on sites redeveloped
with HOPE VI funding, public housing families are often largely excluded from the new
housing constructed on the site of their former homes. This exclusion of families is
tremendously unfair. Families who have had to live in severely distressed public
housing—often the only housing available and affordable to them—are being not
permitted to share in the revitalization of their communities.
This fact has not been squarely addressed by HUD or by public housing authorities
participating in the HOPE VI program. For example, Miami-Dade, Florida mayor Alex
Penelas was quoted in a 1999 HUD press release announcing a $35 million HOPE VI
revitalization grant for the Scott and Carver Homes public housing developments: “The
residents of Scott and Carver Homes will now have a greater opportunity to become selfsufficient homeowners, productive employees and residents who can be proud of their
neighborhood.”11
In fact, almost no Scott and Carver Homes residents can expect to return to their
neighborhood under the Miami-Dade HOPE VI plan. The Miami-Dade application called
for the demolition of 850 units of public housing. These units were to be replaced with
only 80 units of rental public housing and 382 homeownership units. The bulk of these
homeownership units, while described as “affordable,” will be well beyond the means of
current Scott and Carver Homes residents. According to the Miami-Dade HOPE VI
application, the minimum qualifying income levels for these units all range from nearly
twice to over three times the income of the average Scott and Carver Homes family.
The HOPE VI Program Diverts Funding from Basic Public Housing Maintenance
In 1992, 86,000 units of public housing were estimated to be “severely distressed,” a
figure that represented 6 percent of the 1.4 million units then in existence. Four years
later, HUD set a goal of removing 100,000 public housing units by the year 2000. As of
10
NHLP, Survey of the Proportion of Family Public Housing Rental Units in HOPE VI Revitalization
Sites: FY 1998, 1999, 2000 Awards, 31 HOUS. L. BULL. 45 (Feb. 2001).
11
See HUD, Cuomo Announces $78.3 Million in HOPE VI Grants to Miami-Dade, Lakeland, and
Bradenton, Florida to Transform Public Housing, HUD No. 99-162 (Aug. 25, 1999), available on-line at
http://www.hud.gov/library/bookshelf18/pressrel/pr99-162.html.
Millennial Housing Commission
July 11, 2016
Page 4 of 5
October 2000, over 110,000 units were on track for removal from the public housing
inventory.12
Despite having met and exceeded its 100,000-unit goal last year, HUD is set to fund an
additional $565 million in HOPE VI proposals later this year. According to HUD’s own
demolition goals, the upcoming round of HOPE VI Program funding should not be
necessary.
HUD justifies its continued operation of the HOPE VI Program, despite having met its
demolition goals, on additional deterioration of the country’s public housing stock since
1992. HUD has not set a new demolition goal for itself or provided an updated estimate
of the number of severely distressed public housing units, but HUD’s position may have
some merit.
Beginning in fiscal year 1993, funding for the HOPE VI Program came from a set-aside
of $600 million formerly applied to the Public Housing Capital Fund. The Capital Fund
supports basic maintenance and upgrades for all public housing units. If what HUD says
is correct, the diversion of funding from the Capital Fund has resulted in the accelerated
deterioration of the nation’s public housing. In other words, despite HOPE VI’s purpose
of solving the problem of severely distressed public housing, tens of thousands of
additional units — totaling perhaps 50 percent or more of the original number identified
by the National Commission — have become severely distressed since the program’s
inception. Paradoxically, this on-going deterioration of the nation’s public housing due to
diversion of resources to the HOPE VI Program in turn provides further justification for
the continuation of the program.
HUD Has Not Provided a Complete Picture of HOPE VI Results Nationwide
Without sufficient information, it is impossible to develop meaningful strategies to
address the HOPE VI Program’s shortcomings. After eight years, HUD has never
produced a comprehensive report on the results of the HOPE VI Program. Instead, HUD
has published selective case studies of a handful developments from a handful of the
cities that have received HOPE VI funding.13 HUD has no plans to publish a nationwide
study until 2004 or 2005 — 11 or 12 years after the program’s inception.
We urge the Millennial Housing Commission to gather and analyze national data on the
HOPE VI Program. We believe that this should include an assessment of the
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12
number of dwelling units the program has produced;
family income levels at which these units are designed to be affordable;
HUD Special Application Center, Demo/Dispo Units: State Total Recap (Oct. 26, 2000).
See, e.g., HUD, An Historical and Baseline Assessment of HOPE VI (Aug. 1999), available on-line at
http://www.huduser.org/publications/pdf/hopevi_vol1.pdf; HUD, Hope VI: Community Building Makes a
Difference (Feb. 2000), available on-line at http://www.huduser.org/publications/pdf/hope_vi.pdf.
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July 11, 2016
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cost of producing these units;
number of families displaced by the program and the effect of this displacement;
location, affordability, and quality of the housing into which displaced families
initially move and subsequently move;
extent to which displaced families are able to rent or buy the new housing
constructed with program funds;
effect of the reduction of public housing on families in need of affordable
housing;
capital needs of the public housing program overall and the cause of the growing
number of distressed units;
extent to which people of color, families with children, and other members of
classes protected under the Fair Housing Act disproportionately bear adverse
effects of the program or are disproportionately excluded from its benefits.
Thank you for this opportunity to express the Nation Housing Law Project’s profound
concerns about the HOPE VI Program. The program is reducing the nation’s supply of
affordable housing at a time when HUD has recognized a severe shortage of affordable
housing. The new housing that the program produces all too often is unaffordable to the
families displaced by redevelopment activities. And, funding for the program comes at
the expense of basic maintenance for public housing developments nationwide. We ask
the Millennial Housing Commission to cast an objective light on these issues, to conduct
an assessment of the overall administration of the HOPE VI Program and its effect on the
nation’s affordable housing shortage.
Yours truly,
Gideon Anders
Executive Director