Transportation, Housing and Urban Development, and Related Agencies

Floor Speech

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Mr. RUBIO. Mr. President, I wish to talk about housing issues contained in the bill we are debating, and I want to talk specifically about a project in Florida that we became aware of in October. It is named Eureka Gardens. It is a low-income, affordable housing project that uses Section 8 funds to house people of lower income, as you are all aware of that program. It is run and owned by an organization called Global Ministries Foundation. It is run by a reverend, Richard Hamlet. It is organized as a 501(c)(3), the organization that owns this building. Mr. Hamlet, Reverend Hamlet, is the head of the organization.

If you look at the Web site for Global Ministries, there is a link that says: ``What We Do.'' If you go to that section of the Global Ministries Foundation Web site, this is what it says they do: ``Providing affordable housing across the United States and ministering to the physical, spiritual and emotional needs of our residents.'' That is what they state as their business purpose. I imagine that is what they needed to state because of their 501(c)(3) not-for-profit status. However, we have a quote from Reverend Hamlet, who has said that his involvement in housing is purely business-related. He said:

This is a business. This isn't a church mission. These are business corporations that we set up, but we're no different from a real estate investment trust or a private equity group.

That is how he described his 501(c)(3), not-for-profit Global Ministries Foundation.

Global Ministries has over 40 properties in multiple States--Alabama, Florida, Indiana, Louisiana, North Carolina, New York, Tennessee, and Georgia. In all of these States, in all of these properties, they have over 5,000 units that qualify as assisted. In 19 locations across Florida, they have over 2,000 assisted units. This particular project in Jacksonville, FL, Eureka Gardens, has 396 assisted units.

This is the problem we found with some of these properties. In Eureka Gardens, in the last year, the property was found to be in horrifying condition. I have spoken of it on the floor before. I am talking about people living in a place where there was mold on the walls, where the appliances were 15 years old, where the apartments hadn't been painted in 13 years, where windows didn't open, where staircases were literally falling down, and where the city had to come in, evacuate people, and condemn the property.

Those were the conditions in Eureka Gardens. We got involved last October to get those remedied. So there was the thinking, well, maybe this is just one property. Maybe Global Ministries only has one property that is run this way but generally they are a good actor.

This is what we found: They have two properties--Warren and Tulane Apartments in Memphis, TN--that have such poor living companies as well that HUD pulled their Federal funding from the housing.

In Atlanta, we found that their Forest Cove property has been plagued by rodents and sewage. This is what news crews reported about their property in Atlanta. It said ``building, siding, and ceiling tiles peeling from many of the buildings. . . . Garbage and stagnant green water were feet from playing children.''

At Forest Cove, this is what a tenant said to news reporters:

I'm homeless right now. I moved out to be homeless.

Because the conditions were so bad, the guy moved out of the property. In other words, he would rather be homeless than live in a Global Ministries Foundation property.

So we have two properties in Memphis, TN, we have a property in Atlanta, and then there is another property in Jacksonville that they own. The property is called Washington Heights. It also has been noted for violation. HUD's most recent review resulted in the property barely passing Federal inspections. And I will have more to say about Federal inspections in a moment.

At the Goodwill Village property in Memphis, one resident said that he thought the issue was snakes on the property--snakes on the property. He thought they were being caused because they were coming to ``eat the rats.''

At Goodwill Village, the same property, a resident had an issue with a gas leak. The resident's home had the sink torn out, her stove and hot water disconnected, and a hole put into her wall. Two months after all of that, no one had come by to fix it.

In Orlando, at the Windsor Cove Apartments owned by the Global Ministries Foundation, reporters saw holes in the walls where roaches and rodents came into the apartment. The same woman has a gap between her bathtub and the wall that lets water leak into the apartment below.

After issues with his properties were exposed, here is what Reverend Hamlet said: ``No one should have to live under these conditions.''

They are your properties. It is not just one property; there are multiple properties across multiple States. I want to focus specifically on the one I visited last week in Jacksonville. It was an amazing experience. Forty-eight hours before we announce we are coming, nothing--literally nothing--is happening at this property. When we announce we are coming to visit the property, suddenly a bunch of contractors show up. They put up a banner welcoming the residents to all the great stuff they do there. Suddenly work crews are walking all over, fixing the place up. All of a sudden, because we are coming to visit, all these work crews mysteriously show up.

Eureka Gardens's problems have been going on for a long time, but they only became known in October of last year when a local television station and other local media began to highlight them.

My Jacksonville office staff toured Eureka Gardens in early 2015 and in October of 2015. I want to report what they found in that one building. As I said, we have now had reports about other buildings with similar conditions run by this Global Ministries 501(c)(3), but I want to share what my staff found when they visited Eureka Gardens. They saw crumbling stairs disguised with duct tape and covered with apparent black mold. When I am talking about the stairs, I mean the stairs that connect the first floor of the building with the second floor of the building, these metal stairs. They would just put duct tape over the areas where the stairs and the wall were cracking and almost falling. They just put duct tape on it. There was mold on these stairs; they spray-painted over it. My staff found faulty electrical wiring. Do you know what they did with the faulty electrical wiring? They covered it up with a garbage bag so no one could see it. They could smell the natural gas odor being sucked from an outdoor piping system into the air-conditioning units of residents, and they found all sorts of other health and safety issues.

At Eureka Gardens, when residents were asked about housing, one resident said, ``Dogs live better than this.'' In fact, there was a 4- year-old living in Eureka Gardens who was suffering from lead poisoning, which her mother has a right to believe she got in her Eureka Gardens apartment--an apartment, by the way, paid for with your taxpayer money. Section 8 housing is Federal taxpayer money going into the hands of these slumlords, and a child now has lead poisoning because of it.

In December of last year, HUD declared Eureka Gardens to be in default of the contract, and it set a February 24, 2016, deadline to meet requirements. In February, Eureka Gardens passed this inspection, but by March HUD had written to Eureka Gardens saying the Department ``does not believe the property would currently pass another REAC inspection.''

Last Friday I visited Eureka Gardens. I saw, for example, an apartment where the window did not open. I saw an apartment where the window did not open. The window had been cracked, and do you know how they fixed it? Somebody came and put a glob of glue where the window connects next to the pane, and if you tried to open the window, it wouldn't go up. That means if there was a fire in that house, the person sleeping in that room would not be able to get out of that window unless they break it. I saw that with my own eyes last week when I was there. I saw an apartment that hadn't been painted in 13 years. I saw a stove where the knobs were unrecognizable because they were covered with glue, basically, and grime. I saw a refrigerator that looked like it was from North Korea. It had to be 15 years old. There was all sorts of rust on the side and they just spray-painted over the rust.

As I said earlier, 48 hours before I visited, Global Ministries started to fix some of these cosmetic issues. By the way, that included putting up a piece of wood with exposed nails and calling it a door. This apartment has two exits--in the front and in the back. This lady gets home from work and she opens her back door. They have boarded up the door, and there are nails sticking through the wood. She has little children. The nails were the kind that if you ran into that door because you didn't know it was there, you would get a nail to the face, to the heart, to the gut.

So you would ask yourself, all right, you have these owners of all these units and they are getting this Federal money under this HUD contract. Where does all the money go? What are they doing with all this money they make? Well, you can look at their 990 tax forms, which are available for all 501(c)(3) organizations.

Let me tell you about the 2014 tax year, which is the most recent one that is available. In the year 2014, the Reverend Richard Hamlet paid himself $495,000 plus $40,000 in nontaxable benefits. Also in 2014, the Reverend Hamlet's family members were paid an additional $218,000.

By the way, he had previously failed to disclose his family members' compensation on tax forms, which is in violation of IRS rules that require CEOs to disclose the compensation of all family members who work for an organization.

The IRS reports also show that between 2011 and 2013, Global Ministries Foundation--the landlord that owns all of these units in all of these buildings that your taxpayer money is paying for--shifted $9 million away from its low-income housing not-for-profit to its religious affiliate. There is no one here who is a more strident proponent of private and public partnerships, of faith-based initiatives, but you have these building that are crumbling. You have these people living in these deplorable conditions. In addition to paying himself half a million dollars and his family another $218,000, they took $9 million, and instead of using it to fix these units, they transferred it to the other entity they had for religious purposes.

They don't seem to want to spend the money--including the taxpayer money--on making repairs, on making sure places like Eureka Gardens are liveable. Let me tell what you they do spend their money on. They spend their money on public relations specialists, because last week when I visited Eureka Gardens, they had a public relations firm on the premises counterspinning me with the media, saying things like: Oh, well, where has Rubio been all this time? Well, this became available in October, and since October we have been involved in it.

So they have the money to hire a law firm. They have the money to hire a lobbying firm. They have the money to hire a public relations firm. They have the money to transfer $9 million from the not-for- profit sector into their religious uses. They have the money to pay themselves half a million dollars per year, plus $40,000 in nontaxable benefits, plus $200,000 for family members, but they don't have the money to fix these units--and not just in Florida but all across this country.

Let me tell you what this behavior is. Let me tell you what Global Ministries Foundation is. It is a slumlord. They are slumlords. There are people who are living in these deplorable conditions while your taxpayer money is going into their bank account, and they are laughing at us.

By the way, the other day, this minister--he has now put these properties up for sale. He told the press: This is such a profitable business. We have so many bidders who want these properties.

Well, No. 1, if it is such a profitable business, why are you organized as a 501(c)(3)? And No. 2, where is all the money? Where are all the profits? Why aren't they being invested?

I am all in favor of faith-based organizations being involved in the public and civic life of this country, but as an organization that was organized on the principles of caring for others, this is not caring for people. This, my friends, is the stealing of American taxpayer money, subjecting people to slum-like conditions, pocketing the money, living off the money, and transferring the money.

For the life of me, I don't know how they passed any inspections. I am not a building inspector. You don't have to be one to visit this building and know there is no inspection that building should ever pass.

I would just say that this is the most outrageous behavior I have seen in public housing, and now I am hearing that the same conditions exist in Orlando and in other buildings in Jacksonville. We know they exist in Memphis. In fact, they just lost their HUD contract in Memphis. A judge just issued a ruling against them yesterday on another issue in Memphis, TN.

As a result of these conditions and other issues, I have filed four amendments I wish to briefly talk about. The first is amendment No. 3918, which passed. What it does is it shortens the required response time for contract violations from 30 days to 15 days. Within the 30 days that they found that gas leak at Eureka Gardens, four people at Eureka Gardens were hospitalized due to gas leaks. So I am glad shortening the timeframe will be a part of it.

Another amendment we passed is one that basically asks HUD to determine the state of the assessments. Even the Secretary himself has told me it is time to revisit these assessments. If you look at this property, there is no way it should have ever passed any inspections. We need to fix the inspection process in HUD because there is no reason a property like this should pass any inspection.

The third amendment I filed, and that I hope we can pass, would give State and local governments more say when HUD renews contracts for owners who have violated previous contracts. In essence, the amendment would allow the Secretary to refuse to withdraw a notice of default if the Governor of the requisite State petitions HUD to do that.

Currently, the only trigger for the Secretary to withdraw a notice is a REAC score of 60 or above. If this amendment became law, if the property passed the inspection but the Governor of the State in which the property is located requests the Secretary to overturn the result, the Secretary would have the power to do so.

This impacts Eureka Gardens and these other places because flawed inspections led HUD to recertify properties that are not up to standard. The Jacksonville City Council has been engaged and Mayor Curry of Jacksonville is supporting this amendment. It would grant them the ability to seek the Governor's support in having a say over the properties.

The last amendment I filed is Rubio amendment No. 3986, and it is to make temporary relocation assistance available for residents in situations such as those I have just described. This amendment would make tenant protection vouchers available for tenants living in units where the owner has been declared in default of a HUD Housing Assistance Payments contract due to physical deficiencies, allowing the Secretary to consider granting tenant relocation vouchers sooner in the process.

The lack of temporary relocation assistance has kept these tenants trapped in Eureka Gardens. The inability to temporarily relocate resulted in tenants being hospitalized because of gas leaks and other difficult conditions. For example, a man had to sleep in his bathtub for a week at Eureka Gardens, and tenants could not cook because the heat was shut off for days at a time.

One of the things we hear from HUD is: Well, we can take away the contract, but then what happens to all these people? We don't want to do that, and slumlords like Reverend Hamlet and his group know they can get away with this as a result.

There is probably more to be done. I said publicly that I think the Justice Department should look into these people. I think the Justice Department should look into places such as this. I think the IRS should examine their tax status. I think people like this should never again be allowed to have a single HUD contract anywhere in America. This is unacceptable, and it is happening right under our noses.

Today it is Eureka Gardens, but I mentioned all those other States. In fact, I encourage my colleagues who live in the States of Alabama, Indiana, Louisiana, North Carolina, New York, and Georgia to look into the properties that Global Ministries Foundation operates in your States. If the trends continue, if the trends hold up, then I almost guarantee you are going to find slumlike conditions in your State the way they were found in my State and the way they were found in Tennessee.

I hope I can earn my colleagues' support in bringing these reforms as a part of the bill before us today.

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