Building Affordable Housing is Risky Business
Please note: This post is a collaboration between James Brooks and Michael Wallace at NLC.
For the past two days, The Washington Post has lambasted the Department of Housing and Urban Development and local housing authorities and community development corporations for failing to adequately manage programs that build or rehabilitate affordable housing.
There is a great deal wrong with the conclusions drawn by The Post. It is useful for us to step back and examine the obvious: HUD and local authorities have an 85% success rate at going into the poorest neighborhoods in the country and providing affordable housing. These are neighborhoods that private developers don’t dare to tread on their own because of the financial risk involved. (To see a list of successful HOME projects, please look at the 20th Anniversary award winners at http://hometa.info/index.cfm?do=viewDKAwards.)
In its reporting, The Post brushes off the complete collapse of the housing market that represents a significant and real factor that has caused delays in all efforts to build or rehabilitate housing. This housing market collapse began in 2006 and continues to languish to this day. This is a major reason why many buildings remain unsold.
Granted, not everything is rosy. There remains a need for improved capacity of local housing authorities and community development organizations. But, this is already being addressed by more aggressive reporting requirements in the Neighborhood Stabilization Program (NSP).
If these reports are any indication, the local groups are improving their reporting and demonstrating they are effective in delivering housing programs even during a time of significant crisis. This occurs despite local governments continuing to reduce their workforce in significant numbers as a response to the poor economy.
Additionally, HUD has been working to update its obsolete data management systems that are the legacy of the slash and burn tactics by the leadership of HUD operations from 2001 to 2009. And, as HUD’s own response to the articles points out, they are recapturing money at every instance where fraud is taking place.
While there is no denying some of the lapses in oversight that The Post reports, the characterization that HUD and local housing agencies are complicit and doing nothing is false. To pick only the most egregious projects and ignore that the vast majority of the projects in the program are wildly successful, smells of cherry-picking for sensationalism. There are very good managers and program officers at every level making significant contributions to the lives of millions of families around the country.