Blog: Feds Must Fix Up Public Housing

Statement

Public housing can work ... when it's maintained right. But the results have been tragic when public housing buildings are not properly taken care of.

A public housing authority in Toledo, Ohio had to close 100 public housing apartments because of mold that made the apartments unsafe. In Chattanooga, Tennessee, over 20% of the units at the Harriet Tubman Development have been boarded up because of dangerously poor conditions like leaking roofs. In New York City, chronically broken elevators have trapped tenants, caused injuries, and even led to the death of a 5-year-old boy trying to get out of a stalled elevator. The list goes on.

The cause for these tragic events is simple: no money.

Massive federal disinvestment in public housing has left housing authorities strapped for cash and unable to make necessary repairs.

At this point, authorities estimate that unmet repairs average about $25,000 per public housing unit. With about 1.1 million public housing units nationwide, that means we'll need approximately $27.5 billion to make public housing livable again. That's a lot of money. It's hard to see Congress appropriating this full amount when the recent high water mark to repair public housing was the $4 billion secured in the American Recovery and Reinvestment Act (ARRA) - the Recovery Act - in 2009.

This reality shows that we need a new system to fund public housing.

This is why I introduced the Rental Housing Revitalization Act in Congress this past December. The Revitalization Act solves the public housing money problem by allowing these developments to take out mortgages and other financing to repair deteriorating buildings. Right now, public housing authorities can't use mortgage financing even though other affordable housing programs already do this. Mortgages allowed under the Revitalization Act will be sustainable, because the legislation also stabilizes the federal funding allocated to public housing buildings opting into this new system.

Using mortgage financing to revitalize public housing is a no-brainer, because it can improve building conditions both quickly and on a wide scale. By getting mortgage funding at the beginning and all at once, public housing authorities can begin comprehensive repairs instead of moving piecemeal from one problem to another. As for scale, the U.S. Department of Housing and Urban Development calculates that the Revitalization Act will generate as much as $7 billion in capital for repairs in the first year alone. In subsequent years, this reaches up to $25 billion. In other words, the Revitalization Act generates most of the funding needed to catch up on the repair backlog.

The Revitalization Act also breaks new ground by giving public housing residents more flexibility about where they live. In the current program, residents are wedded to living in public housing buildings if they want to keep their housing subsidy. Under the Revitalization Act, public housing residents will have an opportunity to move out of public housing but keep their subsidy in the form of a Section 8 voucher - tenants use these vouchers to subsidize the rent in privately-owned apartments. Giving public housing residents this choice and control will help families adapt to life or job changes.

The Revitalization Act builds on a proposal made earlier this year by HUD, which was known as PETRA. But, through the additional input of housing advocates and other stakeholders, the legislation now has strengthened affordability protections not included in the HUD version. These safeguards will prevent public housing from falling into private hands - even in the event of a mortgage default or foreclosure. If an owner of public housing defaults on its mortgage, the Revitalization Act gives HUD the power to step in to cure the default. If a public housing building ends up in foreclosure, the Revitalization Act mandates that HUD or another public entity must purchase the building.

Even with these protections - and despite the continuing decline of public housing buildings - some on the left find this legislation controversial. They fear that mortgage financing will hand public housing over to the private sector.

But, as I see it, the real risk to public housing is doing nothing at all and allowing these buildings to continue their decline. Eventually, this will put the future of public housing in serious jeopardy. The Revitalization Act not only improves housing standards in the short term, but it ensures the longevity of public housing by putting the program on a sound financial footing. I introduced this legislation because I support public housing, and I am unalterably opposed to privatizing or losing these important public assets.

The Rental Housing Revitalization Act deserves the consideration of the Financial Services Committee and Congress as a whole as lawmakers get to work during the 112th Congress. I look forward to continuing to work with advocates and stakeholders on developing this proposal during the 112th Congress.

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