Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at the National Leased Housing Association 38th Annual Conference

Washington, D.C.

June 18, 2009

Thank you, Denise, for that generous introduction. It's a pleasure to be back among friends and colleagues from the world of multifamily housing as we celebrate your 38th Annual Conference.

Let me also take a moment to recognize outgoing President Steve Salop and incoming President Alan Isbitz who joins us from Jewish Community Housing for the Elderly in Boston. Thank you both for all you've done and will do.

This Association's motto is "Serving America's Rental Housing Needs." And at a moment when we face a housing and economic crisis the magnitude of which we haven't seen since the Great Depression, those needs are greater than ever.

For nearly four decades, you've helped us grapple with the changing political and economic realities of low- and moderate-income housing - and in the coming months, as we develop a balanced, comprehensive housing policy we will need your guidance, counsel and tenacity like never before.

In my view, nothing will be more critical to the stability and vitality of our communities and our country.

A Common Agenda
And so let me state for the record what I hope all of you already know:

HUD is completely committed to building and preserving affordable housing nationwide.

From this day forward, ours is a common agenda.

You and I both know that a home is the foundation upon which we build our lives, raise our children and plan for their future.

Home is family.

It is the source of a family's stability - the building block with which we forge neighborhoods, put down roots and build the communities that are the engines of our economic growth.

With homes so central to our success as individuals and as communities, ensuring that every American family has access to decent, safe and affordable housing is not just part of HUD's mission - it is the core of our mission.

Unfortunately, that foundation has been seriously eroded by our ongoing housing and economic crisis. Millions of Americans have already lost their homes or are in foreclosure. Some have fallen into homelessness, devastating families and communities alike.

Homeownership is incredibly important. But if this crisis has taught us anything, it's that it is long past time we had a balanced, comprehensive national housing policy - one that supports homeownership, but also provides affordable rental opportunities, and ensures nobody falls through the cracks.

Indeed, bringing HUD's multifamily rental efforts into the 21st century was one of the biggest reasons President Obama asked me to assume this responsibility.

From my experience in New York, I know that on these issues is that local partners, owners, and residents know best when it comes to navigating the local politics and barriers to affordable rental housing. HUD's job is to provide guidance, flexibility and incentives that empower our partners on the ground to carry out their critical work.

It's all part of the strategic partnership we envision with states, metropolitan areas, localities, and the private sector that fosters collaboration and innovation at the local level to tackle the structural housing challenges facing families.

Key to this partnership at HUD will be Deputy Secretary Ron Sims, who as King County Executive in Washington State was instrumental in creating a new Regional Affordable Housing Program. Through his work, King Country contributed an average of $10 million annually for regional housing development and supportive housing opportunities.

Our Deputy Assistant Secretary for Multifamily Housing Programs, Carol Galante, will also play a critical role. Carol joins us at HUD from the Bridge Housing Corporation, California's largest non-profit developer of affordable apartments and homes.

Carol's convening stakeholder meetings this week - including one yesterday with Denise - to engage a wide cross-section of community and industry partners as we evaluate how HUD's preservation programs are working and strategize how to best reform them within our existing administrative framework.

And one of her priorities right now is to modernize our multi-family closing documents to speed and simplify the process of preserving and developing new affordable housing.

Our goal is to serve more families, more effectively and with less money.

Making Affordable Rental Housing Preservation A Priority
A critical component of our affordable rental housing commitment will be our support for Section 8 Project-Based Assistance, which helps us create and preserve affordable housing units in multifamily developments across the country.

With demand so high, this Administration is committed to full 12 month funding of Section 8 contracts, which is demonstrated by HUD's funding allocations through the Recovery Act that add $2 billion to ensure that this commitment is met, as well as the same full funding in our FY 2010 budget.

Stability and consistency will be hallmarks of our work on Section 8 Project-Based Assistance going forward. Annual renewal funding should be predictable, timely, and sufficient to fund rental contracts for a full 12 months.

I know that many of you have had concerns and frustrations with late payments and the crisis that occurred when full funding was not available, and we are fully committed to working with you to make sure that those concerns are addressed.

Our 2010 budget also requests a higher level of federal funding for housing vouchers - the most direct means to meeting the affordability challenge facing very low income renters and the most efficient means of addressing the increase in homelessness we've seen of late.

HUD is also committed to improving both the stability and consistency of our voucher program, including a more predictable renewal formula.

Again, funding stability leads to program stability and with program stability comes the opportunity for HUD to work with public housing authorities to reduce the administrative barriers of our voucher program. My hope is that the SEVRA legislation currently being discussed in Congress will help us start to make progress on these reforms.

Let me also mention that our 2010 budget makes a strong commitment to the National Affordable Housing Trust Fund. The product of more than a decade's worth of work, the Fund represents the first major federal housing production program since the creation of the HOME program in 1990.

Our budget requests $1 billion for the initial capitalization of this fund. With 74 units available for every 100 very low-income households - and only 44 for those in extreme poverty - the Affordable Housing Trust Fund is essential to providing affordable housing in America.

Sustainability and Affordable Housing Improvement:
While these programs are at the heart of HUD's work, I see affordable housing as a bedrock component of our efforts to build the stronger, healthier, and inclusive communities America needs to meet the challenges of the 21st century.

This idea is at the core of HUD's Sustainable Communities Initiative, which will better coordinate governmental efforts to integrate transportation, housing, and land use planning.

Today, families spend nearly 60 percent of their budgets on housing and transportation costs. That's not only unacceptable - during an economic slowdown, it's unsustainable.

Essential to these efforts is building green. We need to dispel the notion that green building will mean higher energy costs for low-income families.

No one is more vulnerable to rising energy prices than low- and moderate-income families, who often cut back on other needs, such as medicine, food, or education when costs go up. Property owners, landlords and managers feel the pinch of these costs as well.

So, does HUD, which spends about $5 billion on energy for our public housing and Section 8 operations alone. Saving just 5 percent annually could generate a savings of $1 billion over the next several years that we could invest in affordable housing.

That's why we have formed a partnership with the Department of Energy to streamline and better coordinate the use of $16 billion in federal weatherization funds appropriated through the Recovery Act. Those funds will allow us to reach approximately 1.1 million public housing units, another 1.2 million privately owned federally-assisted units, and some 950,000 units financed with Low Income Housing Tax Credits.

In my view, no one has more to gain from green building than low and moderate income families - whether it's through lower energy costs, better health, or more job opportunities.

After all, we're talking about a new generation of professionals, not simply ready to build these technologies, but to install, repair and maintain them.

Planning communities in a more integrated, sustainable and inclusive way isn't separate from advancing economic opportunity for the families we're trying to reach - it's absolutely essential.

A Bedrock Commitment to Affordable Rental Housing
All of these efforts depend on the same thing: a bedrock commitment to affordable rental housing.

This as a civil rights issue. If there isn't equal access to safe, affordable housing, there isn't equal opportunity. It's that simple. In America, we should never be able to predict a child's life expectancy by the zip code they grow up in.

Building strong, healthy sustainable communities that reject that certainty for millions of children is what our collective work is about - yours and mine.

With a new set of priorities, a new commitment and a new way of doing business, I'm convinced we can and will. Thank you for this opportunity.