[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
BUILDING BACK A BETTER,
MORE EQUITABLE HOUSING
INFRASTRUCTURE FOR AMERICA:
OVERSIGHT OF THE DEPARTMENT
OF HOUSING AND URBAN DEVELOPMENT
=======================================================================
HYBRID HEARING
BEFORE THE
COMMITTEE ON FINANCIAL SERVICES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
__________
JULY 20, 2021
__________
Printed for the use of the Committee on Financial Services
Serial No. 117-40
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
__________
U.S. GOVERNMENT PUBLISHING OFFICE
45-507 PDF WASHINGTON : 2021
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HOUSE COMMITTEE ON FINANCIAL SERVICES
MAXINE WATERS, California, Chairwoman
CAROLYN B. MALONEY, New York PATRICK McHENRY, North Carolina,
NYDIA M. VELAZQUEZ, New York Ranking Member
BRAD SHERMAN, California FRANK D. LUCAS, Oklahoma
GREGORY W. MEEKS, New York BILL POSEY, Florida
DAVID SCOTT, Georgia BLAINE LUETKEMEYER, Missouri
AL GREEN, Texas BILL HUIZENGA, Michigan
EMANUEL CLEAVER, Missouri ANN WAGNER, Missouri
ED PERLMUTTER, Colorado ANDY BARR, Kentucky
JIM A. HIMES, Connecticut ROGER WILLIAMS, Texas
BILL FOSTER, Illinois FRENCH HILL, Arkansas
JOYCE BEATTY, Ohio TOM EMMER, Minnesota
JUAN VARGAS, California LEE M. ZELDIN, New York
JOSH GOTTHEIMER, New Jersey BARRY LOUDERMILK, Georgia
VICENTE GONZALEZ, Texas ALEXANDER X. MOONEY, West Virginia
AL LAWSON, Florida WARREN DAVIDSON, Ohio
MICHAEL SAN NICOLAS, Guam TED BUDD, North Carolina
CINDY AXNE, Iowa DAVID KUSTOFF, Tennessee
SEAN CASTEN, Illinois TREY HOLLINGSWORTH, Indiana
AYANNA PRESSLEY, Massachusetts ANTHONY GONZALEZ, Ohio
RITCHIE TORRES, New York JOHN ROSE, Tennessee
STEPHEN F. LYNCH, Massachusetts BRYAN STEIL, Wisconsin
ALMA ADAMS, North Carolina LANCE GOODEN, Texas
RASHIDA TLAIB, Michigan WILLIAM TIMMONS, South Carolina
MADELEINE DEAN, Pennsylvania VAN TAYLOR, Texas
ALEXANDRIA OCASIO-CORTEZ, New York PETE SESSIONS, Texas
JESUS ``CHUY'' GARCIA, Illinois
SYLVIA GARCIA, Texas
NIKEMA WILLIAMS, Georgia
JAKE AUCHINCLOSS, Massachusetts
Charla Ouertatani, Staff Director
C O N T E N T S
----------
Page
Hearing held on:
July 20, 2021................................................ 1
Appendix:
July 20, 2021................................................ 63
WITNESSES
Tuesday, July 20, 2021
Fudge, Hon. Marcia L., Secretary, U.S. Department of Housing and
Urban Development (HUD)........................................ 5
APPENDIX
Prepared statements:
Fudge, Hon. Marcia L......................................... 64
Additional Material Submitted for the Record
Hill, Hon. French:
Washington Post article, ``Rent prices are soaring as
Americans flock back to cities''........................... 68
Huizenga, Hon, Bill:
``Mortgage Insurance for Mortgage Transactions Involving
Downpayment Assistance Programs''.......................... 72
Tlaib, Hon. Rashida:
Article from The Detroit News, ``Detroit homeowners overtaxed
$600 million''............................................. 73
Torres, Hon. Ritchie:
Written statement of Capital One............................. 81
BUILDING BACK A BETTER,
MORE EQUITABLE HOUSING
INFRASTRUCTURE FOR AMERICA:
OVERSIGHT OF THE DEPARTMENT
OF HOUSING AND URBAN DEVELOPMENT
----------
Tuesday, July 20, 2021
U.S. House of Representatives,
Committee on Financial Services,
Washington, D.C.
The committee met, pursuant to notice, at 10 a.m. in room
2128, Rayburn House Office Building, Hon. Maxine Waters
[chairwoman of the committee] presiding.
Members present: Representatives Waters, Velazquez,
Sherman, Meeks, Scott, Green, Cleaver, Perlmutter, Himes,
Foster, Beatty, Vargas, Gottheimer, Lawson, San Nicolas, Axne,
Casten, Pressley, Torres, Lynch, Adams, Tlaib, Dean, Ocasio-
Cortez, Garcia of Texas, Williams of Georgia; McHenry, Lucas,
Luetkemeyer, Huizenga, Wagner, Barr, Williams of Texas, Hill,
Emmer, Zeldin, Loudermilk, Davidson, Budd, Kustoff,
Hollingsworth, Gonzalez of Ohio, Rose, Steil, Gooden, Timmons,
Taylor, and Sessions.
Chairwoman Waters. The Financial Services Committee will
come to order. Without objection, the Chair is authorized to
declare a recess of the committee at any time. As a reminder to
all Members, we have a hard stop at 1:30 p.m., and Members who
are unable to ask their questions at today's hearing will be
given priority at our next hearing with the Secretary.
Pursuant to House rules, the committee will continue to
provide accommodations for Members who request to participate
in hearings virtually, but I am very happy to have the vast
majority of our Members and our witnesses participating in
person here today. As a reminder, those who are not fully
vaccinated must continue to wear a mask in the hearing room and
practice social distancing, but I would also like to encourage
our Members to continue wearing masks if they feel more
comfortable doing so.
And so, Members, we have a little bit of a problem with our
timing apparatus here this morning. We can see the timing here,
when your 5 minutes are up. Our witness can see her 5 minutes,
and, of course, it will be monitored by our friends on the
opposite side of the aisle, so we will make sure that we are
all in sync with the timing.
Let me just say that I am going to be very strict with the
timing. If you take all of your 5 minutes to ask a question and
then expect the Secretary to answer for another 2 or 3 minutes,
that will not happen today. After 5 minutes, you will be
gaveled. So, thank you.
Today's hearing is entitled, ``Building Back a Better, More
Equitable Housing Infrastructure for America: Oversight of the
Department of Housing and Urban Development.''
I now recognize myself for 4 minutes to give an opening
statement.
First of all, a happy good morning, Secretary Fudge. I am
so delighted to have you with us today to discuss the work that
the Biden Administration is doing to build a more fair,
equitable, and accessible housing infrastructure in this
country.
I want to begin by applauding you and the Biden
Administration for treating our housing crisis with the urgency
and seriousness it deserves. The Trump Administration made it
crystal clear that it didn't appreciate the magnitude of our
nation's housing crisis. By repeatedly proposing deep budget
cuts to HUD programs, and taking action to undermine our fair
housing laws, the Trump Administration showed a complete
disregard for low- and moderate-income (LMI) families, people
of color, the LGBTQ+ community, and immigrants.
It is only because of Democrats in Congress that HUD's
budget was not decimated during Trump's presidency. Because
elections matter, President Biden and HUD have now begun to
reverse Trump's anti-fair housing rules. Democrats on this
committee also remain laser-focused on ensuring that eligible
families receive the housing assistance available to them
through the CARES Act, the December relief package, the
American Rescue Plan, and other coronavirus relief legislation.
We must remember, however, that we are not just building
back our economy from the pandemic and Donald Trump's
disastrous housing policies; we are building back better, and
that is my focus for today's hearing. Key to building back
better and more equitably is understanding that housing is
infrastructure. For the first time in a generation, we have a
real opportunity to fix structural problems in our housing
system and reverse decades of disinvestment in low-income
communities and communities of color.
Last week I, and several members of this committee
introduced a legislative package of three bills to do just
that. The first is the Housing is Infrastructure Act, the
second is the Ending Homelessness Act, and the third is the
Downpayment Toward Equity Act, which would help address the
racial gap in homeownership by providing $100 billion toward
down payment and other financial assistance for first-
generation home buyers.
We must make housing a top priority. These generational
investments will increase homeownership, provide a permanent
housing safety structure, and end homelessness in this country
once and for all.
Secretary Fudge, I know you are the right person to take
advantage of this moment. Thank you so much for your leadership
on this absolutely critical issue. I look forward to your
testimony today.
I now recognize the ranking member of the committee, the
gentleman from North Carolina, Mr. McHenry, for 4 minutes.
Mr. McHenry. Thank you, Madam Chairwoman. Thanks for
holding today's hearing.
Secretary Fudge, welcome. It's nice to see you in your
first appearance before Congress. On that side of the table, it
has a different perspective.
But I must begin today by asking, where is Treasury
Secretary Yellen? I sent the Chair a letter last week asking
for the Treasury Secretary to join us for today's hearing, but
it looks like they could not make that happen. Maybe Secretary
Fudge can shed some light on the most pressing issue in housing
at the moment for the Federal Government, and that is in regard
to the Rental Assistance Program. I know millions of renters
across the country and across the income spectrum would like
some answers.
Look, Madam Chairwoman, we are on a deadline. The Biden
Administration's eviction moratorium ends on July 31st. The CDC
has already said, no more extensions, so what are people
supposed to do? What is the plan? Last December, Congress
provided $25 billion in emergency rental assistance. Democrats
then added another $21 billion this year for the exact same
purpose. That is $46 billion. This might not sound like a lot
of money, considering what the Democrats are talking about in
spending $3.5 trillion on the progressive agenda with the next
budget. But I assure you, for the Americans who have to decide
next month whether to buy food for their family or to pay back
rent, it certainly is.
This money was specifically intended to retire old rent
debts and end the threat of eviction for millions who fell
behind during the pandemic. So, where is that money and whom is
it helping? The silence is deafening. The Washington Post
reported over the weekend that little more than $1 billion has
made it out the door. And I will remind my colleagues again,
that we have allocated $46 billion to help with this rental
problem.
Republicans on this committee have put forward a solution,
the Renter Protection Act. This bill would end the Biden
Administration's mismanagement of the emergency rental
assistance and get the money out the door now.
Last week, I called for the committee to consider this
bill, but the Chair has not scheduled it, or anything like it,
for a markup. Okay. So, what about a hearing? We are days away
from a preventable problem, and instead of figuring out how to
keep families in their homes, we are going to get an update
from HUD on all of the other stuff, on a forward-looking basis,
that they are working on. This is government at its worst.
It is clear that Democrats would rather talk about anything
but the rental assistance program and resolving old rental
debts. Not to mention with this level of mismanagement and lack
of transparency, I can only imagine the amount of waste, fraud,
and abuse of taxpayer dollars we will have to address. But
lucky for us, we have no information, so hear no evil, see no
evil, I guess is the approach right now.
Fortunately, for this hearing, HUD has a statutory
obligation with respect to transparency of these funds. The
original Emergency Rental Assistance Law requires the Treasury
Department, ``in consultation with the Secretary of Housing and
Urban Development--whom we have before us today--to provide
public reports on the use of the Emergency Rental Assistance
Program.''
So, while I would prefer to ask these questions to
Secretary Yellen, because they are supposed to be in the
driver's seat at Treasury, Madam Secretary, I will direct them
to you. And my questions here regard the mismanagement of this
program, and why less than 4 percent has gone to help renters,
and 96 percent has been unallocated.
So, where is the Treasury Secretary? I will ask that again.
I look forward to the questions.
Chairwoman Waters. I now recognize the gentleman from
Missouri, Mr. Cleaver, for 1 minute.
Mr. Cleaver. Thank you, Madam Chairwoman, and let me begin
where you began in this committee earlier, and that was with
your almost holy housing obsession, particularly on affordable
housing. So, thank you very much. The country, I think, is
moving in that direction.
I would also like to thank my dear friend, Secretary Fudge,
for not only being with us today, but for taking the time this
past May to visit Kansas City to discuss the vital role that
HUD has in every one of our congressional districts. Secretary
Fudge is, in fact, listening. She is taking bold action, and
her commitment to improving the Department and the quality of
life for hard-working Americans is unquestionable.
Madam Chairwoman, we know that we do not need another
study. I hope that there is no legislation designed to study
housing. We do not need another news article to tell us that
the wealthiest nation on Earth has streets filled with homeless
folks. We do not need another report to explain the American
Dream of homeownership.
Thank you very much.
Chairwoman Waters. Thank you. I now recognize the gentleman
from Arkansas, Mr. Hill, for 1 minute.
Mr. Hill. Thank you, Madam Chairwoman. I appreciate our
friend and former colleague, Secretary Fudge, appearing before
us today. But I have to reinforce the comments made by the
ranking member about the noticeable lack of Secretary Yellen. I
can't help but mention how available Secretary Mnuchin made
himself over his 4 years in office, and particularly for this
committee during the pandemic, and I hope we can expect that
from the Biden Administration.
It is imperative to have Secretary Yellen here to ensure
accountability for the trillions of dollars the government has
spent over the last year. Alarmingly, only 11 percent of the $9
billion provided to HUD by the CARES Act has been spent to
date, and none of the American Rescue Plan money has been used
to help an actual household yet.
Even more concerning is the gross mismanagement of the
Eviction Rental Assistance Program. In my home State of
Arkansas, of the $200 million allocated by Congress in
December, a mere $1.4 million, 70 basis points, has been
distributed.
I look forward to discussing this more during my questions,
and I yield back, Madam Chairwoman.
Chairwoman Waters. Thank you very much. I want to welcome
today's distinguished witness, and former colleague of ours,
the Honorable Marcia Fudge, who is the Secretary of the U.S.
Department of Housing and Urban Development. This is Secretary
Fudge's first time appearing before this committee in her
current capacity, and we welcome her testimony today.
You will have 5 minutes to summarize your testimony. You
should be able to see a timer on the table in front of you that
will indicate how much time you have left. I would ask you to
be mindful of the timer, and when the red light appears, to
quickly wrap up your testimony, so that we can be respectful of
the committee members' time. And without objection, your
written statement will be made a part of the record.
Secretary Fudge, you are now recognized for 5 minutes to
present your oral testimony.
STATEMENT OF THE HONORABLE MARCIA L. FUDGE, SECRETARY, U.S.
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD)
Secretary Fudge. Thank you so very much. Good morning,
Chairwoman Waters, Ranking Member McHenry, and distinguished
members of this committee, many of whom are my friends, and I
miss you. It's good to see you. Thank you for this opportunity
to discuss the transformational investments the Biden-Harris
Administration has proposed to advance housing opportunity in
America.
I know President Biden is committed, in his head and in his
heart, to help more people find a stable, affordable, and
dignified place to call home. He has made that commitment
clear. The President's proposed budget for Fiscal Year 2022
requests $68.7 billion for HUD. This represents an increase of
$9 billion, or 15 percent, from our enacted funding from the
previous fiscal year.
The American people need every dollar in this budget.
Today, it is harder to find an affordable home in America than
at any point since the 2008 financial crisis. The high cost of
housing keeps millions of families up every night. They wonder
if they can afford to keep a roof over their head and still
manage to keep their lights on, to pay for their prescriptions,
or to put food on their tables.
The President's budget takes bold action to address our
affordable housing crisis and to dramatically strengthen our
social safety net for the most vulnerable among us. The
President's budget requests $3.5 billion to provide housing and
supportive services to Americans experiencing homelessness,
including young people and survivors of domestic violence. It
contains $30.4 billion for HUD's Housing Choice Voucher Program
which, if enacted, would deliver life-changing assistance to an
additional 200,000 households.
The President understands that investing in housing
represents a major solution for advancing equity on behalf of
underserved Americans. The President's budget requests $723
million in Indian Housing Block Grants to create affordable
housing and spark economic development on Tribal lands. It
contains $3.8 billion in Community Development Block Grants,
including $295 million in targeted funding for historically
underserved areas and cities, small towns, and rural
communities.
Nearly half of our public housing stock is more than 50
years old. Many properties face significant capital needs. This
is not just a safety issue but an issue of racial justice, as
Americans of color represent roughly 70 percent of people
living in public housing. The President's budget provides $3.2
billion in capital funds to help restore public housing and to
improve the quality of life for the residents we serve.
We know people of color are especially vulnerable to the
threats posed by climate change and extreme weather. We are 3
times as likely to live in areas which lack green
infrastructure that helps guard against flooding. Too often, we
find ourselves in the path of natural disasters and are denied
the resources we need to rebuild our homes and our communities.
That is why President Biden provides $800 million to strengthen
climate resilience in public housing on Tribal land and across
HUD-supported communities.
The President's 2022 budget is just one part of his
commitment to make generational investments into America's
housing. In addition to the vital support contained in his
budget, the President has called for sweeping new housing
investments through his Build Back America agenda. These
investments would help build or restore more than 2 million
affordable homes. The Build Back Better agenda would help more
families of modest means realize the dream of homeownership. It
would expand our supply of affordable rental housing and help
revitalize our public housing stock.
Our nation must move with urgency to enact investments
contained in both the President's budget and his Build Back
Better agenda. During the COVID-19 crisis, we all came to
appreciate just how important it is to have a safe and stable
place to call home. Today, thanks to the leadership of
President Biden, our country is making great strides in
rebuilding from the pandemic. Our economy is surging, more
Americans continue to get vaccinated, and life is beginning to
feel closer to normal.
Yet, America cannot return to the status quo of yesterday,
prior to the pandemic. We must not return to an America beset
by crumbling homes and buildings, to an America grappling with
a crisis in affordable housing. We must build back better
together.
I look forward to partnering with this committee to help
make housing for all a reality in our nation and to ensure that
HUD acts as a responsible steward for the funding entrusted to
us.
And with that, Madam Chairwoman, I am happy to answer any
questions.
[The prepared statement of Secretary Fudge can be found on
page 64 of the appendix.]
Chairwoman Waters. Thank you, Madam Secretary. I now
recognize myself for 5 minutes for questions.
Since I joined this committee 3 decades ago, I have been
consistently focused on homelessness, not just managing it but
ending this national embarrassment for one of the richest
nations in the world. As you know, homelessness is also a
racial justice issue. Despite representing less than 30 percent
of the total population, Black, Indigenous, and Latinx
individuals make up well over two-thirds of the people
experiencing homelessness in America. Once they fall into
homelessness, they are also far less likely than their White
counterparts to be able to access the health and mental health
services they need to obtain and maintain housing.
Just last week, a team at the Urban Institute, led by Mary
Cunningham, who previously testified before this committee on
my Ending Homelessness Act, conducted a study on the
effectiveness of permanent supportive housing in interrupting
the costly cycle of chronic homelessness.
In a randomized trial, participants in a Denver supportive
housing initiative reduced their arrests and emergency room
visits by 40 percent relative to the comparison group, and more
effectively addressed their health needs, including doctor's
office visits and prescriptions.
Secretary Fudge, you and I have talked about this
endlessly, all during the time that we have served here, and I
know how you feel about homelessness. And I know that we have
had a conversation more than once about supportive services.
And, of course, we know that with supportive services, we are
able to help people become more independent, if we can help
them get to the doctor, if we can help them make sure they take
their prescriptions, and all of that.
And so, I think it is important for us to talk about
supportive services, and what that means as we deal with this
homelessness issue, because as we talk about additional
affordable units and rental assistance and all of that, we know
that to the degree that we are able to assist people take hold
of their daily lives, with not only taking care of doctor's
appointments and all of that, but being able to get up every
day and maybe do everything from exercise, to read, to go to
the local library, or what have you, that this would go a long
way in helping them to become independent.
So, how do you feel about supportive services and what that
could mean in terms of the way that we look at homelessness?
Secretary Fudge. Thank you very much for the question. If
we do not have supportive services, Madam Chairwoman, what we
do is really set up people to fail. Once we get people off the
streets--and you know as well as I do that on any night in
America, more than 580,000 people in this country, the greatest
nation in the world, have no place to sleep, so until we can
start to provide those services, whether it be health services,
whether it be educational services, access to work, access to
transportation, and a myriad of other things, we really have
not done much, because we have not given them the tools and the
ability to live on their own successfully.
Chairwoman Waters. I know we absolutely agree on that
issue.
Let me just say a word about this rental assistance that
the ranking member talked about. We passed the Heroes Act in
June, and again in October. We also passed the standalone
version of the Emergency Rental Assistance Bill in July. It was
not until December that Republicans came to the table to help
us pass emergency rental assistance. So, it is very interesting
that Republicans are now complaining about delays in
implementation. We would have been much further along in the
implementation if Republicans had not dragged their feet in
acknowledging the problem from the start. And they can't be
more worried about it than I am. That is my issue. That is the
issue that I spend the most time on. And yes, I added
additional money after we had done the CARES money, into the
American Relief Plan.
We know that we have a problem all over this country. I
know that Secretary Yellen and you--everybody is concerned
about that. We are doing everything we can to get the States to
do what they should do in putting together the programs that
they need to do to get the rental assistance out.
I just wanted to say that as I end, and turn the time over
to Mr. McHenry.
The gentleman from North Carolina, Mr. McHenry, who is the
ranking member of the committee, is now recognized for 5
minutes.
Mr. McHenry. Thank you, Madam Chairwoman, and thank you for
talking about the same thing that I think we all care about. We
have allocated $46 billion to rental assistance. The Emergency
Rental Assistance Program was supported by both parties when
the law finally got passed. And when Secretary Yellen was here
in March, she pledged that she would come back before this
committee to explain what was going on.
According to the documents from Treasury, less than 4
percent of the money provided by Congress has reached eligible
households. So Secretary Fudge, can you tell us how much of the
$46 billion in rental assistance has ended up in the hands of
renters or their landlords at this point?
Secretary Fudge. Certainly, I cannot speak for Secretary
Yellen, but I will give you the facts as I know them. I would
be happy to do it.
What I do know is that Treasury has obligated 100 percent
of the resources from emergency rental. It is in the hands of
States, local communities, and some continuums of care. So, the
resources are out. It is not a fact that Treasury did not get
it out; 100 percent of the resources are out.
What we are doing now to assist--
Mr. McHenry. How much is in the hands of renters?
Secretary Fudge. Sir, I have no idea, but I would say this
to you--
Mr. McHenry. So, is the Washington Post story correct
that--
Secretary Fudge. I am not--
Mr. McHenry. --it is just over $1 billion? Were you
familiar with the Washington Post story I referenced, from the
weekend?
Secretary Fudge. I have not read the story, sir, so I don't
know if it is accurate or not.
Mr. McHenry. Okay. So, you are saying the funds are
allocated, but you are not sure if they have gotten in the
hands of anyone?
Secretary Fudge. I know it has gotten in the hands of some
people. I don't know that number.
Mr. McHenry. Is that knowable from government or is it--I
am not trying to play a pop quiz on you in testifying, but you
are, under law, statutorily consulted by the Treasury Secretary
for this program, and since she is not appearing, and this is a
very pressing issue, I think we have a right to know why only 4
percent has actually gotten in the hands of eligible
households. Is that a correct number?
Secretary Fudge. As I said, sir, I don't know if it is or
not.
Mr. McHenry. So, we don't know--
Secretary Fudge. What I do know--
Mr. McHenry. --if it is $1 billion, or less or more of the
$46 billion?
Secretary Fudge. HUD does not track the resources, sir.
Mr. McHenry. We will follow up with you on that comment,
because statutorily. you are required to publish the data about
Emergency Rental Assistance (ERA).
Secretary Fudge. In consultation with Treasury.
Mr. McHenry. Yes, but HUD is the one to publish the report,
statutorily, under ERA.
Section 501(g) of Division N of Public Law 116-260, which
created the original ERA program--are you familiar with it? It
reads, ``Reporting requirements. The Treasury Secretary, in
consultation with the Secretary of Housing and Urban
Development, shall provide public reports not less frequently
than quarterly regarding the use of funds made available under
this Act.''
The last report says only 4 percent has gotten in the hands
of renters. Do you dispute that?
Secretary Fudge. I don't know if it is accurate or not, so
no, I do not dispute it.
Mr. McHenry. Are you familiar with the report that your
Department published?
Secretary Fudge. Yes.
Mr. McHenry. And in that report, it says that less than 4
percent has gotten in the hands of renters.
Secretary Fudge. The numbers change every day, sir.
Mr. McHenry. Okay. But you have no idea what those numbers
are at this moment?
Secretary Fudge. I do not.
Mr. McHenry. Okay. So given the statutory obligation, can
you tell us what action HUD is taking to make sure that we get
help into the hands of these renters faster? What are you doing
to make that faster, with Secretary Yellen?
Secretary Fudge. We are the people who are providing the
technical assistance. And I would say to you--
Mr. McHenry. What technical assistance are you providing to
get it out the door faster? Is this an urgent issue for your
Department?
Secretary Fudge. It is.
Mr. McHenry. What are you doing to make it faster?
Secretary Fudge. We are talking to the communities, the
people who have the least capacity to use the resources, so we
are helping small and rural communities. We are helping small
and rural communities to get the resources from their States
and from their counties and other local governments, through
the Housing Trust Funds, et cetera. Because most of them do not
have the capacity. We give them money but we do not give them
people. We don't give them the capacity--
Mr. McHenry. You spent $800 million on overhead for this
program to distribute just over $1 billion.
Secretary Fudge. But they don't go to the rural
communities, sir.
Mr. McHenry. But understand that what has been spent by
this Administration is almost the same amount of overhead that
has actually gotten in the hands of renters. That is how deeply
flawed this program is.
Now, this is something that requires, I think, your
attention and Secretary Yellen's attention. This is an
absolute--it looks like complete mismanagement at this point,
when you only have less than 4 percent of the money getting in
the hands of renters, for this very important program.
Secretary Fudge. Let me just, if I may, sir, let me just
first off--we did make a mistake. Treasury actually publishes
the report, not HUD. We consult with them. That is number one.
Chairwoman Waters. The gentleman's time has expired, and
this program is overseen by Secretary Yellen and the Treasury.
When she is before us, then these questions will be--
Mr. McHenry. And that is why I have raised the question, to
invite Secretary Yellen, the Secretary of the Treasury, here.
Chairwoman Waters. The gentleman from California, Mr.
Sherman, is now recognized for 5 minutes.
Mr. Sherman. Secretary Fudge, I am honored to have you
here. And I am thrilled to say the words, ``Secretary Fudge.''
It is so appropriate that you are our sole witness here for
this hearing, and I can think of no better use of the
committee's time than to hear directly and solely from you in
this hearing.
The first question is something I would just like you to
respond to for the record. Our colleague, Salud Carbajal, has a
bill, the Naomi Schwartz Safe Parking Program Act, and I want
to thank the chairwoman for noticing that bill for this
hearing. And it focuses on those who are sleeping in their
cars, the vehicular homeless, and I hope that you would respond
for the record as to whether we can do more to help people who
are sleeping in their cars. It happens, especially in Southern
California. And particularly, if you and your staff could take
a look at the Naomi Schwartz Safe Parking Program Act.
And now, I would like to focus on Section 8, which is so
important to Southern California. People get the Section 8
voucher but then they can't find a landlord in my district who
will accept it. U.S. Senators Coons and Cramer have a bill, the
Choice in Affordable Housing Act--but I hear the story all the
time. People end up having to move 30 to 50 miles away from my
district because they can't find a landlord, and I don't
represent that wealthy of a district.
So, do you think that we can and should do more to
incentivize landlord participation in the Section 8 Program?
Secretary Fudge. Absolutely. And let me just say, if I may,
Mr. Sherman, that the $46 billion is needed. There has never
been anyone who can say that people who are homeless or at risk
of experiencing homelessness don't need the money. If there is
a problem on the Federal side, that is not their problem. The
resources are needed every day to get people off the street. In
California, most people can't afford to live in California
anymore.
The homelessness problem is so great there because even if
we can find a landlord who is willing to rent to someone who is
getting a Section 8 voucher, they can get so much more money
from someone else. So, there is such a small supply for such a
great demand.
Mr. Sherman. Thank you. Members of the committee know that
I have been concerned with these Property Assessed Clean Energy
(PACE) loans, because, first, you have a first mortgage on your
home, and then the PACE loan comes in as, in effect, ahead of
the first mortgage, and that can pose a threat to Federal
programs like FHA that guarantee first mortgages.
But I am also concerned. because as the National Consumer
Law Center says, these products are frequently expensive loans
that are often pushed by aggressive contractors for projects
which provide questionable savings and pose serious risks of
predatory lending. That is why I want to thank the chairwoman
for noticing for this hearing my bill, the Improving Federal
Oversight of PACE Financing Act, and to thank the National
Consumer Law Center for endorsing that bill.
Madam Secretary, would you agree that we need to take more
steps to protect consumers and the Federal mortgage guarantee
and assistance programs when it comes to these predatory PACE
loans?
Secretary Fudge. I don't know that I would agree to it
being predatory, but I would say that I do believe--
Mr. Sherman. Actually, some of them are predatory, and some
are not predatory. I want to make that clear.
Secretary Fudge. I agree.
Mr. Sherman. There are some that are quite legitimate, but
they come in above the--
Secretary Fudge. No, I absolutely agree, we need to have
more conversations, further discussions, and look at it to be
sure that it truly is providing a source of affordable
financing. Yes, I agree.
Mr. Sherman. Thank you. I yield back.
Chairwoman Waters. Thank you. The gentlewoman from
Missouri, Mrs. Wagner, is now recognized for 5 minutes.
Mrs. Wagner. Thank you, Madam Chairwoman, and I welcome our
former colleague, now Madam Secretary Fudge.
First, I think you are going to hear this from all of us,
because we are just deeply, deeply disappointed and frustrated
that Treasury Secretary Yellen is not testifying today. And I
know you are going to take a number of questions from us based
on the joint efforts between HUD and Treasury.
The Treasury Department has failed to properly administer
more than $46 billion, that's ``billion'' with a ``B,'' in
rental assistance to struggling families, and frankly, Madam
Secretary, the taxpayers in Missouri's 2nd Congressional
District deserve more accountability and transparency than what
we are seeing from the Biden Administration.
Congress has appropriated this money for families facing
the threat of eviction, but less than 4 percent, which you are
going to hear over and over again, of the rental assistance
funds have actually reached eligible households. It is
unacceptable that Secretary Yellen is not appearing before this
committee when time is so urgent. We have 2 weeks before
expiration. She should be here today to answer for the
mismanagement of the Emergency Rental Assistance Program: $46
billion, and less than 4 percent reaching those who need it.
Secretary Fudge, outside of Treasury's Emergency Rental
Assistance Programs, HUD received tens of billions of dollars
in Community Development Block Grants and Homeless Assistance
Grants from the CARES Act, two different programs, almost a
year-and-a-half ago, and frankly, the vast majority of which
remains unspent. Only 12.3 percent of the $5 billion in the
CARES Act's CDBG funds have yet been spent by grantees, while
only 9.4 percent of Homeless Assistance Grants in the CARES Act
have been spent.
What is this money, that is in your jurisdiction, Madam
Secretary--why are these funds delayed from reaching those who
need it the most?
Secretary Fudge. Thank you for that question. I think it is
a great question. HUD has actually obligated, which means we
have given to grantees, more than 93 percent of all CARES
money. Part of the problem with the CARES money is that as
communities receive the CARES money, and then they receive the
COVID money, the rescue money, what they determined was the
CARES money is the money that needed more planning, that gave
them a longer period of time to spend. And so, what they
basically said was, ``Let's spend the emergency money right
away. CARES money, we want to take the time to actually plan,
so that no one will accuse us of waste, fraud, and abuse,''
which we often do when people harshly and hastily spend Federal
resources.
So, they are in the planning phase. They have almost 4
years left on CARES dollars, so those are the dollars they are
using last, but they do have them.
Mrs. Wagner. But the need is so great right now, Madam
Secretary. Let me get to my second question here, which is, I
think, a reflection of what we have seen with this patchwork
quilt of different rental assistance programs. There has been a
lot said about the ability and inability of certain
jurisdictions to build two, three, or four different emergency
rental assistance programs and keep track of all the money,
with so many competing rules and timelines. And much of this, I
think, has to do with the rules that been set out, that are so
onerous that they are not being properly administered by our
Federal agencies and overseen by our Federal agencies, at both
HUD and Treasury. So, there are competing rules and timelines.
Given the limited experience and expertise of certain
localities, wouldn't it be easier to run it if there was only
one consolidated program with one rule set?
Secretary Fudge. Well, I don't know that it would be
easier. It depends on what the rules would be. But I would
certainly suggest to you that most communities are accustomed
to dealing with HUD. They get most of their technical
assistance from HUD, even though Congress decided to send this
money through Treasury. Communities are accustomed to dealing
with HUD.
Mrs. Wagner. But we have sent a lot through HUD, too, Madam
Secretary.
Secretary Fudge. I'm sorry?
Mrs. Wagner. We have sent a lot through HUD, also.
Secretary Fudge. And our resources are out, Mrs. Wagner.
Mrs. Wagner. But they are not being spent at the local
level. Those rules, that rule set, that oversight, that
accountability comes back up through your agency. I am not sure
if my time is expiring. I have not been watching. How much time
do I have?
Well, I would just say that anything we can do to try and
streamline this progress, to get the money to both the renters
and the landlords who are suffering right now is what needs to
be done, not 4 years from now, right now.
I will yield back. I am sure I have used--
Secretary Fudge. And I would agree with you.
Mrs. Wagner. Thank you.
Chairwoman Waters. Thank you very much. Let me deal, just
for a second, with this question about Secretary Yellen, as
opposed to Secretary Fudge and HUD. No, I did not invite
Secretary Yellen to intrude on the first time that Secretary
Fudge would appear before us, and I don't intend to treat women
that way. And so, no, Secretary Yellen is not here. She will be
here when the quarterly time is due, and that is it.
Mrs. Wagner. And I very much look forward to that, Madam
Chairwoman. Thank you.
Chairwoman Waters. The gentleman from New York, Mr. Meeks,
who is also the Chair of the House Committee on Foreign
Affairs, is now recognized for 5 minutes.
Mr. Meeks. Madam Secretary, I am delighted to see you, and
even more delighted with the job that you are already doing at
HUD. You have made increasing production and access to
affordable housing a priority for HUD's budget, and you have
identified our severe shortage of affordable housing as a
barrier to the home purchasing process.
As you know, since the financial crisis, private investors
have focused much on real estate because of high yields.
However, what I am concerned about is that the private
investors can often out-compete potential first-time home
buyers. Some cite cumbersome FHA paperwork as slowing down the
process for traditional home buyers as well as making the rehab
loan process expensive.
So my question is, can you consider or look at streamlining
the FHA loan process to put first-time home buyers in a better
position to compete with private firms in the home purchasing
process?
Secretary Fudge. Absolutely, and we are doing that now, by
looking at a number of things. One is that HUD has not given a
lot of small-dollar loans, which are what people need to
rehabilitate their homes. But we are changing that. HUD has
looked at credit in a way that we think has been unfair to
persons of color or low- or moderate-income home buyers,
because we have weighted student debt differently than we have
other debt.
So, we have created an environment in which people who
carry student debt, primarily Black people, Brown people, poor
people, and moderate-income people, and we have decided to
weight that differently to allow people to really be
creditworthy at this stage. We have also, in conjunction with
our Chair, looked at down payment assistance. So, we are doing
a lot of the things that you are requesting, and I am just
really happy that you brought it up. Thank you so much.
Mr. Meeks. And I wanted to bring up the next one,
homeownership, because it is important, in my estimation, in
closing the wealth gap, which has been a priority of mine and a
priority of this committee. And as you have just correctly
stated, your key component of achieving that is helping
individuals build up equity through homeownership. And again,
because of the price of homes skyrocketing, student borrowers,
especially those of color, view homeownership as unattainable.
That is why I am so happy that you have already taken on how
you calculate student loan debt in its underwriting process to
better reflect what student borrowers actually pay monthly,
which is not often the sticker price, which gives them an
opportunity to become homeowners, build equity in their homes,
and thereby closing the wealth gap. That is so tremendously
important.
Maybe I should just ask you, can you explain a little bit
more how you are implementing that policy and your forecast of
how impactful that change will be for student borrowers, and
especially those of color?
Secretary Fudge. Well, think about it this way, if I can
just give you a very quick example. Prior to our making the
change, a person who makes about $50,000 a year and has about
$75,000 worth of student debt could not be approved for a house
that costs $200,000, $225,000. They can now. That is the
difference.
And the other thing I think is so important is the fact
that we make an assumption that if you have a lot of student
debt, then for some reason you are not creditworthy. But I know
when I went to school, my mother would have paid anything,
every dime she had, to make sure I had a good education. And
so, it is not a matter of not being able to pay. We know most
people who can afford an apartment can afford a home. The good
thing is that HUD actually secures more than 50 percent of all
first-time home buyers' mortgages, and it is something that
comes within our shop, so we can make a difference.
Mr. Meeks. You are making a difference. I don't know how
much time I have left.
Secretary Fudge. A minute.
Mr. Meeks. A minute? I thought it was 6 minutes.
[laughter]
Mr. Meeks. But I will go until they stop me. Let me also
ask--I am a product of public housing in New York City, and
there is a big issue with the question of repairing public
housing. In New York City public housing, many of the buildings
there--the one that I grew up in, for example, is now 60-years-
old. I recently went to visit, and saw that a number of the
apartments are beyond repair
And so, I am hoping that in looking at some of these older
institutions, and New York City's Housing Authority is the
largest housing authority in the country, that we are looking
at ways in which we can make sure that we can rehabilitate the
apartments so that individuals can live in decent apartments in
a timely fashion, which they can afford.
Secretary Fudge. We are looking at it.
Chairwoman Waters. The gentleman's time has expired. The
gentleman from Michigan, Mr. Huizenga, is now recognized for 5
minutes.
Mr. Huizenga. Thank you, Madam Chairwoman. Madam Secretary,
I do want to do one little piece of housekeeping here. There
has been lots of discussion, obviously, about whether Secretary
Yellen ought to be sitting with you today. Just to clear the
air on that, Secretary Yellen last appeared at this committee
at the invitation of the Chair, with Chair Powell. I think I
called her Chair Yellen there. But former Chair Yellen, now
Secretary Yellen, was invited to this committee with Chair
Powell to do a joint CARES quarterly meeting. That was in
March. They were supposed to be back in June. They have not
been back. She has not been back. And that March meeting is
when she had made some commitments about getting back to this
committee.
So, there is no intention of disrespect to anyone. I am
sure there was no intention of disrespect to anybody back in
March, when both Secretary Yellen and Chair Powell were invited
to a joint hearing on this.
Onto some of the issues that we are talking about today,
and I have to tell you, I was a little taken aback when, I
think in response to my colleague from California, you
mentioned that--and I wrote this down--``People can't afford to
live in California anymore.'' I think a lot of us see that, and
realize that, and I think a lot of people in California are
seeing that and realizing it, which is why they are moving out
of California.
What is, I think, disturbing, or certainly confusing for a
lot of us is, then, does that simply mean because California
has made California very expensive to live in, that it is the
rest of the country's responsibility to then subsidize those
rents and to subsidize that cost structure that California has
imposed upon its own citizens? And this could go for any State,
whether it is Michigan or New York or California.
I want to talk a little bit about a program here in
Michigan. You have expressed your strong support for down
payment assistance as a means of increasing minority
homeownership, certainly an important goal for many of us. When
I was in the State legislature in Michigan, I chaired the
Commerce Committee. I worked on a number of housing issues at
that time, and I am happy to be on the subcommittee that is
continuing to have that.
But I have to say, I was a little surprised to see that HUD
announced recently that it would be pursuing rulemaking that
would restrict FHA financing for loans with this type of
assistance. And in my home State of Michigan, the Michigan
State Housing Development Authority runs a successful program
that provides Michiganders with up to $10,000 towards the
purchase of their first home.
So, could you shed some light on what HUD hopes to
accomplish with this particular rule, and can you assure me
that it won't negatively impact successful programs like the
one operated by Michigan's Housing Finance Authority?
Secretary Fudge. Which rule are you referring to?
Mr. Huizenga. There had been an announcement that HUD would
be pursuing a rulemaking regarding FHA financing loans that
have this assistance, down payment assistance.
Secretary Fudge. I am thoroughly confused. Can you tell
me--
Mr. Huizenga. My understanding is that there was an
announcement by HUD that--and I can't open the link, because I
actually am using paper--but the link to it being cited, that
it is going to be pursuing rulemaking on this down payment
assistance program.
So are you saying that there is not going to be a
rulemaking?
Secretary Fudge. Let me say this to you, since I am not
sure what rule you are talking about; it is not clear to me.
All of our work is to advance down payment assistance. We want
homeownership. We would do nothing--
Mr. Huizenga. Okay. Reclaiming my time here, so you can
assure me that it won't negatively impact State programs like
the one that we have in Michigan?
Secretary Fudge. Yes.
Mr. Huizenga. Wonderful. We will hold you to that. Staying
on that issue, one of the bills we are examining today would
create a new down payment assistance program that would be
housed within HUD, with a price tag of $100 billion. That
program would actually be larger than your entire annual
budget, which this Administration has even increased. So given
that there are approximately 2,500 national, State, and local
programs like the one operated by Michigan's Housing Finance
Authority, that are already providing down payment assistance
to first-time home buyers, I might add without using taxpayer
dollars, do you think that we need to be spending limited
resources duplicating these efforts for the Federal program?
Chairwoman Waters. The gentleman's time has expired.
Mr. Huizenga. I will pursue that with a written question.
Chairwoman Waters. Thank you. The gentleman from Georgia,
Mr. Scott, who is also the Chair of the House Agriculture
Committee, is now recognized for 5 minutes.
Mr. Scott. Thank you, Madam Chairwoman. I appreciate that.
Secretary Fudge, I am so proud of you. You and I served
together in the House for many years, and you are doing a
wonderful job as Secretary.
Now, I want to pick this up in a way and deal with two
issues. I want to get to the rental one, because that has
raised some issues as well. But I think it is very important,
because we have the nation watching this. And while I am on
that, Chairwoman Waters, you are absolutely right. It was very
important. This was her first chance to come before this
committee, and she deserves to have this opportunity on her
own. And I respect you and thank you for doing that.
Now, I want to set the record straight. First of all, the
White House's initial infrastructure proposal included a $213
billion investment to create and retrofit over 2 million
affordable housing units that were, and still are badly needed.
But in the bipartisan infrastructure agreement that provision
did not make the cut.
So here we are, working our way through the infrastructure
situation, and I think it is fair for us to hear from you. What
do you see? What do you want? It is your job to deal with this.
Tell us what we must do, how much money we need to make sure is
here to get the job done.
Secretary Fudge. Thank you very, very much. Just a couple
of things to frame this for you. There is no place in America
today where a person making minimum wage can afford a two-
bedroom apartment. Nowhere. Not just California. Nowhere. So,
we know that we need affordable housing.
And so, Mr. Scott, I would say to you that we are
anticipating, and very hopeful, that in the reconciliation in
the Build Back Better Plan, the resources will be there to
build at least 2 million, but we need far more. There are 11
million people in this country today who are spending more than
half of their money on rent. It cannot continue. It cannot
support itself.
So, we know that we need more, but we are hopeful that we
will at least get the resources to match what the President is
asking for in the Build Back Better Plan.
Mr. Scott. Thank you. And now, let's go to this rental
issue, because we worked hard, and we did get nearly $47
billion there. But I want you to, and I think the nation needs
to know that you can execute the program, but much of these
funds go down to the States to implement. How has that been
handled, and do you see difficulties in the States fulfilling
their obligation, because in so much of this--I have been
involved in this for quite a while. You were with us when we go
all the way back to the hardest hit program, when we sent
billions of dollars down to our States and Territories so that
we could help homeowners stay in their homes. We are doing the
same thing with the renters. We even have moratoriums going on.
But tell us how this works, and also tell us, does this
money go to the renter? Does it go to the landlord? How does it
work? America may need to know.
Secretary Fudge. Let me start at the back end. The money
goes to the landlords, so the landlords can be made whole, so
that we can get people current with their rent. But most
importantly, part of the problem has been that when we sent the
money to the States, and to anything other than CDBG or a
formula city or community, the money was held up because they
didn't have the assistance or the capacity to get it out fast
enough.
So what we have been doing--personally, I have been calling
mayors and governors and others to say that we have to get the
money through the system. What we are seeing today is that the
numbers of resources that are getting out is increasing
exponentially every month.
Mr. Scott. Thank you.
Chairwoman Waters. The gentleman's time has expired. The
gentleman from Kentucky, Mr. Barr, is now recognized for 5
minutes.
Mr. Barr. Thank you, Madam Chairwoman, and to our former
colleague, congratulations on your appointment and
confirmation.
I do want to echo the comments of the ranking member and my
colleagues about the Emergency Rental Assistance (ERA) program.
Perhaps it is right that you are here all by yourself in your
first appearance, but it is also right that Secretary Yellen
should be here to testify, not just about the mismanagement of
this programc, but also her statutorily-mandated quarterly
CARES oversight hearing. I don't know why she hasn't yet
appeared.
But let's talk about the $46 billion appropriated by
Congress and only 4 percent of it that has actually reached
renters. With vaccines distributed and available and many
lockdowns ended, taxpayers, I think, are asking the question,
either this is too late because people now are working again,
or it is not in time, because the moratorium on evictions is
about ready to expire.
I just think that this is the poster child for why
hardworking taxpayers are so critical of big government,
bureaucratic programs like that. I just want to ask you, Madam
Secretary, given the fact that you do have an obligation under
Section 501(g) of the law to make a report regarding the use of
these ERA funds, what would you say to the taxpayer out there
who is frustrated that only 4 percent of the $46 billion has
actually been deployed? And many of these folks are now back at
work.
Secretary Fudge. What I would say to the taxpayers is that
both Treasury and HUD have done exactly what we were directed
to do by this Congress. We have issued the resources. We are
providing the assistance. And I would further say that we are
required to make reports. There is a quarterly report coming.
We don't give daily reports. But there is a quarterly report
coming, and I think that it will be more reflective of where we
stand.
Mr. Barr. Can you see why taxpayers would be frustrated
that 96 percent of the funds that Congress appropriated, back
at the height of the pandemic, have still not reached renters?
Can you understand why taxpayers would be skeptical of future
spending blowouts like this, going forward?
Secretary Fudge. I can understand why taxpayers would be
concerned if they are at risk of being evicted. There is no
question about that. I agree with you.
Mr. Barr. Well, yes. So to my point, for many of these
renters it is either too late, the money is too late getting to
them, or if it is not too late, then time is of the essence to
deal with the arrears.
Secretary Fudge. I agree.
Mr. Barr. I know you are working on it. I appreciate that.
Just understand, taxpayers are always going to be skeptical
about big government programs, precisely because of the
mismanagement we have seen here.
Housing First: I was encouraged by your exchange with
Chairwoman Waters earlier, when you discussed the need for
services in addition to just a roof over the head of a person
struggling with housing insecurity. I remain concerned that
many transitional housing facilities in my district and around
the country, Madam Secretary, are barred from receiving Federal
Homelessness Assistance Grant funding because they mandate
wraparound services, such as addiction treatment or job
training, as a condition for continued residence. In many
instances, these requirements are beneficial for specific
communities. Facilities like the Franklin County Women and
Family Shelter in my district, in central Kentucky, are left
behind, because their business model, which is demonstrably
effective in our community in getting homeless women into
permanent housing and addiction-free lifestyles, doesn't comply
with a one-size-fits-all qualification for funding
availability.
For the sake of clarity, I am not proposing to end Housing
First, but I am proposing that we end the government's
exclusive reliance on Housing First. HUD's current policies
create a situation like I just described, where providers who
have an excellent record of successfully transitioning people
out of homelessness are excluded from government assistance.
Secretary Fudge, are you willing to work with Congress to
explore innovative options to expand the universe of successful
transitional housing programs that received Federal support?
Secretary Fudge. I am certainly willing to, and I would
really love to talk to whomever you think we are being unfair
to.
Mr. Barr. I would love to have you--the previous Secretary
came to my district. There are a lot of faith-based
organizations in my district and around the country that are
not Housing First, but have an excellent track record, and they
are being systematically denied Federal assistance, and
discriminated against, because they do not have this one-size-
fits-all model of Housing First. But they deliver results, and
they don't get your help.
And I do want to invite you to the 6th District of
Kentucky, and other districts around the country, in both blue
and red districts, where we have non-Housing First models that
deliver for the homeless population of this country.
Chairwoman Waters. The gentleman's time has expired.
Mr. Barr. Yes, I yield back.
Chairwoman Waters. The gentleman said that the Secretary of
the Treasury should be here. The Secretary of the Treasury is
not here because the Chair did not invite her to be here,
because she should not be here.
With that, the gentleman from Texas, Mr. Green, who is also
the Chair of our Subcommittee on Oversight and Investigations,
is now recognized for 5 minutes.
Mr. Green. Thank you, Madam Chairwoman.
And I would add to your commentary that if we had the
Secretary of the Treasury here, we would be asking for the
Secretary of HUD. This is all about a major distraction. My
colleagues on the other side--many of them, not all--oppose a
minimum wage. Many of them fight against a living wage. They
oppose subsidies for housing.
Yet, they are willing to spend billions on nuclear arms,
Nimitz-class aircraft carriers, bombers. But they oppose the
things that give people decent living conditions. Housing
infrastructure has become a bridge in my district for many
people. The infrastructure has become a tent, a lean-to, in my
district.
Too many people are suffering, and Madam Chairwoman, I want
you to know that I totally, completely, and absolutely support
the Housing is Infrastructure Act of 2021 that you have
proposed.
I support it, because nearly 50 percent of all U.S. renters
are cost-burdened and pay 30 percent or more of their income in
housing. Seventy-one percent of the nation's extremely low-
income rental households spend more than half of their incomes
on rent and utilities.
And as the Secretary has mentioned, there is no State where
a full-time minimum wage worker can afford a two-bedroom unit.
As a result of the lack of investment into affordable housing
infrastructure, many families pay unaffordable rents or live in
substandard conditions.
Madam Secretary, do we need to proclaim housing as
infrastructure?
Secretary Fudge. Yes, absolutely. I think that the best way
to describe it, if I may, Mr. Green--when COVID began, the
first thing they said to us was to stay home. What happened if
you didn't have a home?
They said, don't send your children to school. Teach them
virtually. What happened if you didn't have a home and you
didn't have high-speed internet or broadband?
They said if you get sick, stay home. What do you do
without a home?
Mr. Green. Thank you, Madam Chairwoman, and I will yield
back the balance of my time.
Chairwoman Waters. Thank you.
The gentleman from Oklahoma, Mr. Lucas, is now recognized
for 5 minutes.
Mr. Lucas. Thank you, Madam Chairwoman, and it is wonderful
to see my old friend, Secretary Fudge, here.
And before we begin much more discussion, I would just note
that I think some of the concern--the Secretary knows the way
my mind works--some of the concern on my side of the room is
that when the eviction moratorium ends on July 31st, if we
don't have those resources flowing, there are going to be a
bunch of folks who are going to be in a terrible jam at sunrise
on August 1st.
So, it is a legitimate concern that I think is shared by
both sides. How do we make sure that doesn't happen on the
first day of August?
That said, thank you for being here. For those of you who
have not served on another committee that the Secretary and I
served on for a long time, you wouldn't know that we worked
together on a variety of conservation-related issues and rural
development, and from the Secretary, I learned more about algae
bloom in the Great Lakes than I might have otherwise ever have
known. So, I appreciate that relationship that we have had.
And you are in a unique position. Typically--not always,
but typically--House Members don't become Cabinet Secretaries
and step up to that level of responsibility in the Executive
Branch. So, you have a vantage point, a view that most of us
will never have.
If you don't mind sharing for just a moment or two the
things that have caused you frustration but, by the same token,
the things that have been a positive surprise to you in your
new role, things you would not have had knowledge of sitting on
this side of the dais.
Secretary Fudge. Thank you. It is good to see you, my
friend, as well.
The thing that I think has probably disappointed me the
most is that I find that as I come here or to other places,
there is an assumption that we don't work hard to do the work
to serve the American people. We do. I inherited an agency that
is overworked, understaffed, and yet they still do everything
they can to take care of the people we serve. I think sometimes
we forget about the people. That has disappointed me.
I think the thing that has encouraged me the most is that
whenever I travel around the country and talk to people, they
know we care enough to fight to make it right. That is what has
encouraged me. People have hope that we are going to make it
right, and I feel really good about that.
Mr. Lucas. In our time working together on the Agriculture
Committee, I think we were old-time legislators and we worked
to achieve consensus.
In your role as CBC Chair, you were critically important in
helping put the 2014 Farm Bill together, a comprehensive
document that addresses everything from producing food to
people's ability to have enough to eat.
That seems to be out of style these days and has been for
some time. I hope, in your role as the Secretary, that you will
continue that spirit as you work with us.
And as I allude for a moment back to the concern about July
31st, there are some real challenges that are coming up that
face real people back home.
Sometimes, we all get a little excited and we pump a lot of
adrenaline here on both sides of the room and on both sides of
the building. But the bottom line is that we are here to
represent those citizens back home, to make sure they all have
the ability to put that foot on the first rung of the ladder to
carry themselves on up, and that we make things happen.
So as you address this issue about what happens after July
31st, understand that it is a sincere concern by many people
that we don't come up on what will be another catastrophe for
good folks.
And along with that, if you don't mind, I am a big
proponent of bringing the COVID-19 pandemic to an end, and that
is using science and technology to its very best. We now have a
variety of vaccines that are making a real difference out
there. Can you discuss in your final moments how HUD has worked
to leverage the available resources to make sure that there is
access to those COVID-19 vaccines?
Secretary Fudge. Yes, two things. Let me just say I am
concerned as well. There is no way that I want to see people
put on the street or evicted from their apartments or removed
from their homes. I am also concerned, and so we are doing
everything we can to prevent it. We have a short timeframe, but
we know that every single month, we are getting to more and
more people and that additional 30 days is going to make a
significant difference.
As it relates to making sure that people are vaccinated, we
are at a point now where we have to take extraordinary steps.
We are already doing vaccination clinics in public housing
facilities. We are already doing them in almost any pop-up
situation we can find, working along with HHS.
Mr. Lucas. Thank you, my friend. I yield back.
And thank you, Madam Chairwoman.
Chairwoman Waters. Thank you. The gentleman's time has
expired.
The gentleman from Missouri, Mr. Cleaver, who is also the
Chair of our Subcommittee on Housing, Community Development,
and Insurance, is now recognized for 5 minutes.
Mr. Cleaver. Thank you, Madam Chairewoman.
Secretary Fudge, I want to know a couple of things that I
think my colleague just raised, and that is the whole issue of
the vaccine. As you may know, Missouri has been on fire with
COVID for the last week or so, leading the nation in new cases
and hospitalizations.
I don't know how many individuals who are living in public
housing or some form of HUD housing are involved in this
crisis. But is there a plan that is being implemented in HUD
housing that is in some way trying to guide residents into
accessing the COVID vaccine?
Secretary Fudge. There are a couple of things happening.
First, we are working with HHS to be sure that the vaccine is
in the places where we believe it is needed most. There still
are some minor access issues.
But the bigger issue is the educational portion of it.
Because you talk about Missouri on--it is on fire, but it is a
fire that is caused by unvaccinated people, most of whom choose
to be unvaccinated, and there is really not a whole lot we can
do about that other than to continue to tell them why they
should be vaccinated and to continue to make available the
vaccine.
It is in every single pharmacy. We have pharmacies that are
staying open now every Friday, 24 hours a day, to be sure that
people don't have a problem with getting off work. Twenty-four
hours every single Friday, every single week.
If you want to drop your kids off at daycare, we have a
place that will do that for you. Everything that we can think
of to do, we are doing, to make sure the vaccine is available.
Mr. Cleaver. Thank you.
The other issue, and I am sure you are getting a lot of
inquiries about this, is manufactured housing and tiny housing.
Like many other places, we are having difficulty finding
places in our community, in the urban part of my district, and
so we are struggling. Some areas are rejecting tiny homes, and
some are rejecting manufactured housing. Almost all of them
rejected--no matter what the housing is, if it is related to
housing those who are without any shelter.
There is nothing HUD can do to remove this, ``Not in My
Backyard (NIMBY)'' philosophy. But are there any success
stories in the tiny home process or manufactured homes?
Secretary Fudge. Manufactured homes is something, of
course, we interact with all the time. You can build a
manufactured home for something very reasonable, someplace in
the $100,000 range. They are fast to put up. They are easily
installed, and they are an alternative, I believe.
But the problem we have, and you know yourself as a former
mayor, is that zoning and planning create lots of problems for
us. And so, what we are trying to do now is engage communities
to talk about the zoning such that it increases the cost of
housing, it keeps people out, and that is even in addition to
NIMBY. So, there are issues that we are working on, and we do
believe that until we start to address it, we are going to
continue to always perpetually be in this kind of a situation.
Mr. Cleaver. You hit on something, I think, that I want to
address with the U.S. Conference of Mayors, and that is--and
maybe we need a conference with the mayors to talk about this
whole issue of zoning.
I was on a call with people involved in housing from around
the country last week and everybody was talking about the same
issue that you just raised, and that is zoning, and I think we
need to have a revolution in how we do zoning, because we are
zoning poverty, and it needs to change.
At some point, I think maybe HUD should consider some kind
of program with mayors to just get mayors to understand the
problem that is going to continue until we begin to address the
issue of zoning.
Secretary Fudge. And let me just say, I was in Denver last
week, and in Denver, the average price of a home is $700,000.
In Boulder, it is over $800,000.
The thing that they were complaining about was not
necessarily more housing, but that they can't get workers, and
why? Because workers can't afford to live there. They can't
live close enough to be there. So not only do they have a
housing crisis, they have a worker shortage.
And these are things we have to address.
Mr. Cleaver. Thank you, Madam Chairwoman.
Chairwoman Waters. Thank you very much.
The gentleman from Texas, Mr. Williams, is now recognized.
Mr. Huizenga. Madam Chairwoman, a point of order?
Chairwoman Waters. Yes. The gentleman is recognized.
Mr. Huizenga. Thank you. I would like to request unanimous
consent--during my questioning about the rulemaking with the
Secretary, we either miscommunicated, or Secretary Fudge is
unaware of a rule that was proposed in the spring of 2021. It
is titled, ``Mortgage Insurance for Mortgage Transactions
Involving Downpayment Assistance Programs.'' Alissa Saunders is
the contact. This is through OMB, the website, reginfo.gov. And
I ask unanimous consent to submit it for the record.
Chairwoman Waters. Without objection, it is so ordered.
Mr. Huizenga. Thank you very much.
Chairwoman Waters. The gentleman from Texas, Mr. Williams,
is now recognized for 5 minutes.
Mr. Williams of Texas. Thank you, Madam Chairwoman.
And I want to join my colleagues in expressing my
disappointment also with how emergency rental assistance aid is
still sitting idle while renters and landlords are waiting for
help.
Secretary Fudge, it's good to have you here today. As you
are aware, bank participation in the FHA program has dropped
dramatically in the last several years, and in speaking with
some of my friends back home in Texas, the Texas bankers, they
say this is because of two main factors: first, the high cost
of servicing FHA loans; and second, enforcement actions taken
under the False Claims Act.
Several major FHA lenders were hit with unreasonable fines
for what amounted to nonmaterial underwriting errors under this
Act, which has caused many to simply stop participating in the
program rather than run the risk of being fined for minor
errors.
And in response, the FHA made some changes to the quality
control process, and the Department of Justice put in place a
memorandum of understanding (MOU) to try to create some more
certainty within the industry.
I am sure that we all agree that banks need to be held
accountable for major violations of this Act if they were
intentionally trying to defraud the government.
However, I also don't think we should expose lenders to
high penalties for minor violations, and the housing market
might be stronger if we had more competition, which I am a big
supporter of, and competing banks participated in this program.
So my question is, can you provide us with some assurances
that the Department of Justice MOU will remain in place, and
then go into detail, any detail you want, on additional steps
that the FHA is taking to attract more banks back to the FHA
lending program?
Secretary Fudge. Certainly. We are always willing to take a
look at things. But I would suggest to you that FHA is probably
in a better position than it has been in a very, very long
time.
And I think that as it relates to the false claims, I know
that is being worked on, and so I am happy to have a
conversation with anybody on your staff about it.
Mr. Williams of Texas. Okay.
My last question is about the FHA, again, its multifamily
department. I have been told there are massive wait times for
some apartment deals to go through with people having to wait
between 6 months to a year before even being assigned an
underwriter.
And I have seen this a lot. These delays are making it less
attractive for private developers to come in and invest their
money to increase the supply of affordable housing that we need
across the country. And I saw that the FHA contracted out some
of the underwriting work to the private sector, but so far it
has not had any impact on reducing these wait times.
So, Secretary Fudge, what are you doing to work through
this backlog of multifamily deals so we can increase our
housing supply and ensure developers are able to deploy capital
in a timely manner and get people in homes?
Secretary Fudge. You are absolutely right. In the past,
that has been what has happened. We are on top of it. We are
changing the process. We are streamlining the process. I think,
going forward, they will see a much shorter period of time.
Mr. Williams of Texas. Well, in the end, it helps those
looking for homes to live in.
Secretary Fudge. Absolutely.
Mr. Williams of Texas. Thank you for being here.
I yield back.
Chairwoman Waters. The gentlewoman from Ohio, Mrs. Beatty,
who is also the Chair of our Subcommittee on Diversity and
Inclusion, is now recognized for 5 minutes.
Mrs. Beatty. Thank you, Madam Chairwoman, and thank you to
Secretary Fudge.
Let me start by simply saying the title of this hearing is,
``Oversight on HUD.'' I will just cut it short. ``HUD.'' It is
not, ``Oversight of HUD and the United States Treasury.''
And for the record, Madam Chairwoman, I wanted to note that
I do not expect Secretary Fudge to be accountable for Secretary
Yellen. I do not expect her to answer or speak for her, nor did
I expect Secretary Carson to speak for Secretary Mnuchin. And I
know he couldn't. He could barely defend why he took 16.4
percent of HUD's budget before he got started.
I would like to remind my colleagues that Secretary Fudge
has only been in this position for about 6 months. So, let me
educate my colleagues and those listening. She has crisscrossed
the United States for housing. She came to the State of Ohio
and met with a bipartisan team of housing experts.
Let me also say, to allocate 100 percent of the rental
housing funds to State and local governments, we should be
saying, thank you.
In my district alone, having them receive the money--that
part, my colleagues got correct. We should be applauding her
for getting all the dollars there for rental assistance.
Now, it went to the State and local governments to do that.
Let me share with you and paraphrase what she said to State and
local governments in the capital city of Ohio with--including
our mayor sitting there.
She said, ``Allocate the funds and help these individuals
who are in need.''
Thank you for the investments in the nation's housing
infrastructure as part of the Biden Build Back Better plan,
rolling back actions of the Trump Administration which set us
back and undermined the Fair Housing Act. So, thank you.
Now, I do have a question, if I have enough time, but I
want to say thank you to your entire team. They have been
amazing in responding and reaching out earlier this year.
I have a bill, the Housing Financial Literacy Act, that
passed the House with overwhelming bipartisan support. This
bill would give FHA borrowers a 0.25 basis point discount
upfront on their mortgage insurance for first-time home buyers
in exchange for taking a HUD-approved prepurchase housing
course.
And this bill lowered the down payment rate for first-time
home buyers by more than $500 on average, and likely lowered
the default rate within the FHA's portfolio.
Under the current law, the FHA has the authority to
implement this program, which it did between 1996 and 2000. So
would you consider asking your team to reimplement this
discount program for first-time home buyers?
Secretary Fudge. Yes, we are really pushing that towards
the front of the line. We are having discussions about it.
Mrs. Beatty. Thank you. And in my last minute, that I would
be honored to yield to you, is there anything you would like to
say to this committee?
Secretary Fudge. Thank you so much.
I would say to this committee that I have not been gone
from here that long, so I understand your concerns. I am doing
everything that I possibly can do to make sure that we are good
stewards of the resources we have been given.
Just give me time to make it happen. I have been there for
4 months. When I was sitting on your side of the table, I would
probably have been asking the same questions. So, I am good
with that.
But know that I know how to do it, we have the people to do
it, and we will do it.
Mrs. Beatty. Madam Chairwoman, I yield back.
Chairwoman Waters. Thank you very much.
The gentleman from Arkansas, Mr. Hill, is now recognized
for 5 minutes.
Mr. Hill. Thank you, Madam Chairwoman.
And once again, Secretary Fudge, it's great to have you
before the committee and, again, let me add to all of my
colleagues' congratulations for your service to our country as
our HUD Secretary.
I listened to the chairwoman talk what might have been last
summer in terms of getting the rental assistance money started
sooner. But last summer, the Congress was faced with sort of an
all-or-nothing play.
We were going to pass the HEROES Act or have no discretion
to target money that we really felt, on a bipartisan basis,
needed to be targeted, and so we went for days and days without
starting the Paycheck Protection Program back up.
It expired on August 5th last year, and we could have
gotten a targeted bipartisan relief on rental assistance, but
we didn't. So, it passed in December, and $25 billion of that
money in the Appropriations bill has been 100-percent allocated
to the States.
And of the $21 billion that was in the American Rescue
package, only 50 percent of that money has been allocated. So,
it hasn't all been allocated. I wanted to correct the record
that, in fact, it has not been all allocated. I think that is
an important point.
And the ranking member noted the Washington Post story by
Rachel Siegel, ``Five-Alarm Fire: Slow Trickle of Rental Aid
Heightens Concern About Evictions Crisis.''
Madam Chairwoman, I ask unanimous consent to submit this
article for the record.
Chairwoman Waters. Without objection, it is so ordered.
Mr. Hill. Thank you, Madam Chairwoman.
And in this article, there is a quote from Diane Yentel,
president and CEO of the National Low Income Housing Coalition.
She says, ``Setting up rental assistance programs from
scratch is a major and time-consuming undertaking, true. But by
now--repeat by now--that is no excuse for the abysmally slow
pace of spending in some communities.''
I think that lays the stage, and so I ask you, Madam
Secretary, who should be held accountable for getting this
money out? Just within the Administration, who is the point
person, in your view, to get this money out to our tenants and
our landlords who need it?
Secretary Fudge. The people who now have it, which is the
cities and the States. Diane Yentel is absolutely right. It
took some time to stand up the new program. The resources are
there.
That is why I am constantly calling mayors and governors
and other people to say, ``You are the cog in this. Get it
out.'' They know they have the resources. They will say to me,
especially smaller communities, ``Well, we didn't have the
people to do it. We don't know how to do it.''
So, we provide that assistance to them. But it is their
responsibility because they have the resources. It is no
different than if it is CDBG money or any other kind of formula
money or competitive money.
Once they receive it, they are responsible for it. We are
responsible for the oversight, but they are responsible for the
program.
Mr. Hill. But it is a challenge when some of these States
have never done that before, and that was the decision by
Congress.
I think the Treasury Secretary and you have, really, the
disproportionate responsibility to try to set those parameters
and get that out, because the money was distributed in January,
and it is almost the 1st of August, and as I said in my opening
comments, a tiny portion, just seven tenths of 1 percent of
that money in Arkansas has been spent, and just 4 percent,
overall.
Let me switch subjects, if I may. You referenced 50-year-
old housing unit stock and made that a point, and HUD, over the
years, starting with the Obama Administration, has had the
Rental Assistance Demonstration (RAD) program, which was
started in 2011 to preserve and maintain affordable housing by
allowing public housing authorities to convert public housing
units into Section 8 Project-Based Rental Assistance.
HUD Secretary for President Obama, Shaun Donovan, created
that program and he said, ``The administration created RAD as a
comprehensive and innovative strategy that offers long-term
solution to preserve and enhance the country's vital affordable
housing stock by finding ways to get private capital off the
sidelines and back into communities.''
Donovan goes on to say, ``RAD is a model of smart
government.''
So my question to you is, do you agree with Secretary
Donovan that RAD is smart government?
Secretary Fudge. I think it is a great program, because the
thing about it is it still is maintained as public housing.
They don't own it. The private industries don't own it. They
have leveraged the resources.
But it is a problem we are looking at, because the one
thing we have to be very, very careful about, and I know that
Members of Congress are, is that we don't start to go down a
road of privatizing public housing.
Mr. Hill. Okay. Let me ask you one follow-up quickly. Do
you support lifting the statutory cap that currently limits RAD
participation to a maximum of 455,000 units?
Secretary Fudge. I don't know that I--we are still looking
at it. But I would suggest to you that I think that we should
consider raising it, yes.
Mr. Hill. Thank you. I yield back, Madam Chairwoman.
Chairwoman Waters. The gentleman yields back.
The gentlewoman from Pennsylvania, Ms. Dean, is now
recognized for 5 minutes.
Ms. Dean. Thank you, Madam Chairwoman.
Secretary Fudge, welcome. Welcome back. It is a delight to
be here with you and we are delighted that you are here alone
speaking about homelessness, affordable housing, repairs to our
housing stock, and increases to our housing stock.
When you talk about how we were all told to stay home when
COVID hit, it is very poignant that hundreds of thousands of
people in this country had no place to call home, and that
continues to this day.
I represent suburban Philadelphia, Montgomery County and
Berks County. We have the Montgomery County public housing
authority, which serves a large portion of Montgomery County,
Pennsylvania.
It has a portfolio of 625 units and a waiting list of over
20,000 applicants. Simply put, and you have said it over and
over, there is not enough affordable housing for those who need
it.
Could you tell us from the American Jobs Plan with some
specificity how that proposal, this transformational American
jobs plan, will make an impact on that tremendous need that is
in my district, and, I imagine, is mirrored throughout this
country?
Secretary Fudge. Thank you very much for the question.
As a nation, we have not at any time in recent history, for
decades, invested in public housing or new moderate- and low-
income housing. We just have not done it.
And so, time has finally caught up with us. That is where
we find ourselves today. So, the President, in the American
Jobs Plan, recognized the fact that millions and millions of
people need housing.
In that plan originally, if you recall, there was $300
billion set aside just to do housing. There is a new housing
tax credit to incentivize persons to build new housing. That is
in addition to the low-income housing tax credits.
The plan right now looks like it is about $200 billion, but
neither the amount of money--it is the housing, 2 million new
units, and up to 500,000 renovated and rehabilitated units,
units that are energy-efficient, units that are resilient, and
units that will keep the costs down for the people who live in
them.
It is the most significant piece of housing legislation in
my lifetime.
Ms. Dean. It is very exciting, and I do hope we will get it
across the finish line with really broad bipartisan support.
You referenced another problem in my district, which is
that many of our housing units are 40 years or more old. We
have had the opportunity through some investment to renovate
some and reconstruct others.
But, really, the capital needs are very, very great. Just
outside my district in Philadelphia, more than 60 percent of
the housing stock was built more than 50 years ago.
Do you believe that the American Jobs Plan funds will be
able to cover the full scope of what is needed? If you had a
magic wand, what would be needed to make the repairs so that
these are decent, as you say, energy-efficient, safe, warm, dry
places?
Secretary Fudge. Forty billion dollars is really a down
payment. We know that we need so much more. It is estimated
anywhere between $70 billion and $100 billion or more. But what
we do know is that $40 billion is a great down payment to start
to make the change we need to make.
And it is a commitment that I believe that housing
authorities and others are welcoming because they know we have
never, ever given them these kinds of resources.
Do I think it is enough? No.
Do I think it is a great start? Yes.
Ms. Dean. Terrific. Thank you.
I want to switch now to something else I care passionately
about, which is ensuring proper housing for those who suffer
from the disease of substance use disorder, addiction, or those
with mental health ailments.
We know, oftentimes, these people are unable to find
affordable proper housing when that is precisely what they need
to stabilize their lives, receive treatment, and begin to heal.
What efforts is HUD leading for these populations of people
who either are struggling with the disease of addiction or
mental health issues? What is HUD doing about housing for them?
Secretary Fudge. There is a carve-out in the Jobs Plan that
asks for billions of dollars for housing for the disabled,
which would include the population that you are referencing.
Ms. Dean. Thank you very much, and I hope we make sure it
is a robust carve-out for those. And offline, because I see my
time is up, we did signal over to your team that we want to
talk about the problem of the definition of group homes for
those who are in recovery, and unlicensed group homes that are
sometimes taking great advantage of people who are in the
greatest of need.
Thank you, Madam Chairwoman. I yield back.
Chairwoman Waters. Thank you very much.
The gentleman from Tennessee, Mr. Kustoff, is now
recognized for 5 minutes.
Mr. Kustoff. Thank you, Madam Chairwoman, and thank you,
Madam Secretary, for appearing today. Let us see if you would
welcome the opportunity to talk about something other than what
we have talked about here before, and that is Opportunity
Zones, if I could.
We know that the Opportunity Zones were created in the Tax
Cuts and Jobs Act of 2017. In my State of Tennessee, at last
count I saw we had 176 Opportunity Zones, 32 in Shelby County,
which is the Memphis area, an area that I represent with
Congressman Steve Cohen.
And in 2019, I had the opportunity to tour one of those
zones, an area called Union Row. It is now called the Walk.
That is actually in Congressman Steve Cohen's district. I
toured that with your predecessor, Secretary Carson.
Madam Secretary, could you talk about the Biden
Administration's position right now? Is the Biden
Administration, in fact, open to expanding Opportunity Zones?
Secretary Fudge. I don't think they have taken a position
at all at this point. But certainly, we are going to be talking
about it, because not only have Senate Members mentioned it as
well, but it is something that some people feel very, very good
about. So, we will be having further conversations.
Mr. Kustoff. And to that point, Madam Secretary, can you
talk about what specific changes, if any, or reforms that the
Administration would look at to the existing Opportunity Zones
or to further Opportunity Zones, if you would, please?
Secretary Fudge. I don't know, because we have not had the
discussions.
Mr. Kustoff. Thank you. Could you also, Madam Secretary,
talk about where the Biden Administration stands right now as
to the Biden appraisal task force that HUD was guarded with the
leadership of?
Secretary Fudge. Yes. As a matter of fact, I am the Chair
of the task force, and what we are talking about is what we
know to be true, that we have throughout this nation's history
looked at property in certain communities, primarily those that
are Black and Brown, and undervalued those homes.
I live in an all-Black community by choice. My home is
undervalued compared to the community right next door to me,
literally within walking distance. But my home is valued as
much as $20,000 less than a comparable home in another
community.
We want to level the playing field.
Mr. Kustoff. I hear from a number of FHA borrowers that
they say they can't compete in today's market, that sellers are
refusing to entertain offers using FHA financing due to
concerns with certain minimum property requirements, maybe with
appraisal issues, or concerns over the quality of the loan
itself.
Can you talk about what FHA is doing to combat the
narrative and, hopefully, try to address these issues?
Secretary Fudge. The first thing is they can't be using
appraisals at this point. We just started the committee. So if
they have been having problems in the past, it certainly wasn't
that.
And I don't think that there is anything that I see, no
basis--if they are concerned, they need to raise what those
exact concerns are. But there is nothing that has been changed
to this point that would create a problem for them.
Mr. Kustoff. If I could, one last area, and I appreciate
you allowing me to jump to different issues.
This involves the Community Development Block Grant
program, and I think we can all agree that it has served a
vital role.
My question is about Formula B, which uses a pre-1940
housing units variable in determining grant sizes. My position
would be that that essentially allows cities which had large
populations 80 or 90 years ago to receive larger grants today.
And I will use, again, my City of Memphis as an example. In
the year 2020, the City of Baltimore received 3 times as much
funding as Memphis, despite Baltimore having a lower population
and poverty rate than Memphis in current times.
Can you address, if you can address, whether you think that
CDBG, whether the formula is outdated and in fact does need to
be modernized?
Secretary Fudge. I certainly think we need to take a look
at it just like we do so many other formulas in HUD. We are in
the process of evaluating where we stand. Absolutely, I think
we should look at it.
Mr. Kustoff. And I do appreciate that answer. I would
appreciate it if your staff could follow up with my staff on
any thoughts and any proposals, and maybe we could share ideas.
Secretary Fudge. I would be happy to.
Mr. Kustoff. Thank you, Madam Secretary.
With that, Madam Chairwoman, I yield back.
Chairwoman Waters. Thank you. The gentleman's time has
expired.
The gentlewoman from Texas, Ms. Garcia, is now recognized
for 5 minutes.
Ms. Garcia of Texas. Thank you, Madam Chairwoman, and thank
you so much for this very important hearing, and for our
invitation to Secretary Fudge.
And, Madam Secretary, it just sounds so great to say that.
In fact, I am going to say it again. ``Madam Secretary.''
Welcome to your first hearing before the Financial Services
Committee. I know many of us join you and stand with you in
your success, and if there is anything that I or my office can
do, please do not hesitate to call.
I want to focus on housing, of course, particularly access
to housing. Research shows that access to housing equals a
healthy productive society. Access to housing means access to
building generational wealth. It also means closing the racial
wealth gap.
It is estimated that between 2020 and 2040, 70 percent of
new homeowners will be Latino. And Freddie Mac found that in
2019, there were 8.3 million mortgage-ready Latinos aged 45 and
under.
The National Association of Hispanic Real Estate
Professionals found that the top-producing real estate firms
are the ones that offer bilingual services throughout all
stages of the home-buying process.
In light of this, it is important that we think about how
we can use language access to expand access to housing. It is
great to see that HUD's housing counseling agencies provide
multilingual services, and as you said about the homeless, if
we don't provide services, we set them up for failure, and we
want our home buyers to succeed.
This is a critical service. It is important to home buyers
struggling to navigate such a cumbersome financial decision.
The American Rescue Plan provided $100 million for housing
counseling to help struggling families stay in their homes. But
housing counselors do not always have the ability to assist
homeowners with legal help when they need it.
Is HUD reviewing how they can connect housing counseling
with legal aid services in the future? And if so, how is HUD
working with counseling agencies and legal aid services to
ensure access for homeowners who do not primarily speak
English?
Secretary Fudge. Yes. We right now have about $20 million
from, actually, funds that were allocated by Congress to assist
with legal issues, especially.
It was designed, of course, for those who are facing
eviction, but it can be used for other things. So, we do have
$20 million now that came from the Rescue Plan.
In addition to which, we do know as well that the wealth
gap or the gap between homeownership for Black and White
Americans is as wide today as it was in 1968, and so we
understand very clearly the need to be sure that we can bring
in Black and Brown people in a way that is comfortable to them.
So, we do have resources and we are working on it daily to
make sure that we do--
Ms. Garcia of Texas. And they will also address services
for those who cannot speak English or have language barriers?
Secretary Fudge. Absolutely. Language, yes.
Ms. Garcia of Texas. Well, thank you so much. And there is
much being said about how many dollars have actually been
spent, and I think it is clear that you have said that 100
percent of the dollars have been obligated that were received.
And we all know, as you have also stated, that the problem
becomes, you send it to the States, and then the States do not
put it out there quickly enough, or sometimes they sort of play
with the money and don't do quite what we asked them to do.
And as you know, you and I have visited about the situation
with the CDBG dollars for disaster mitigation in Houston and as
they were handled in Texas. We had a hearing about that last
week.
And it is just another example of how the dollars are sent
but the governors--sometimes, governors from the other side of
the aisle, in our case, just decide to either delay or do their
own formulas, or do whatever they want to with the dollars.
What can we do as lawmakers to prevent those situations
from happening? What other guardrails, what other procedures
can we do?
And is it possible that some of these dollars go directly
to cities like Houston who can probably handle the dollars and
have the resources and staff to quickly get those dollars out
the door?
Secretary Fudge. The good thing is that cities like Houston
do get it directly because they are entitlement cities, which
is anything over 50,000 people.
But I would say that I was in this body long enough to have
heard many, many times that States have their rights. They
should be able to do what they want to do. And cities have
their rights, and they should be able to do what they want to
do.
Now, they want me to control it. There is only so much we
can do based upon the way that the law is written, but but we
are enforcing it as best we can.
Ms. Garcia of Texas. Thank you. I yield back.
Thank you, Madam Chairwoman.
Chairwoman Waters. Thank you.
The gentleman from Georgia, Mr. Loudermilk, is now
recognized for 5 minutes.
Mr. Loudermilk. Thank you, Madam Chairwoman.
Madam Secretary, it is good to see you again, and
congratulations on your new role.
As you know, the primary funding source for many housing
authorities is this monthly drawdown from HUD. However,
guidance from the Office of the Chief Financial Officer states
that HUD auditors do not recognize interim directors. Only
permanent officials can obtain drawdowns. What that means is
when a housing authority has an interim director as a
transition period, it may not be able to access HUD funds.
Interim directors were able to do drawdowns in the past. I
am not sure why the policy changed. But this is becoming a
problem and it is a problem with small cities, especially with
small staffs.
It recently happened in my district. The City of Canton had
an interim director, and they were unable to draw down the
money that they needed. They were able to come to a one-time
resolution with HUD.
But there are thousands of State and local housing
authorities in the country that frequently have executive
directors leave their position and an interim director is
appointed.
I understand the intent of the policy is to potentially
prevent fraud, but there needs to be some kind of process for
interim directors to access the downloads.
So my question would be, is this something that you can
look into and find a permanent solution, so that housing
authorities, especially during this time period we are in right
now, don't have to go through so many hoops to--if they have an
interim director in the middle of the change to where they can
actually access the funds for their folks?
Secretary Fudge. Absolutely, because if that is the case,
we do need to look into it. That should not be an impediment to
a drawdown.
Mr. Loudermilk. I appreciate that, and like I said, with
the City of Canton, Georgia, recently they had to go through
this.
They were able to work through a one-time solution. But if
they don't have an executive director by the time the next
month comes in, they are going to have to go through that
again.
On another issue, I would like to echo some of the concerns
that have been raised regarding mismanagement of emergency
rental assistance funds.
The bipartisan December Omnibus provided a structure for a
$25 billion rental assistance program, but instead of
continuing with that program, Democrats established an entirely
new partisan program from scratch. This has created two
different sets of rules for State and local governments to
follow, and has resulted in less than 4 percent of the funds
being distributed so far.
This has created some of, potentially, the worst
legislating that I have seen, with two different programs, with
two different sets of rules, that cities and States are trying
to work through.
So the question is, if Congress consolidated the two
programs into one, would that help get the funds out to renters
more quickly?
Secretary Fudge. I think that Congress should do what they
believe is best. I can't make a decision adjustment based on
what Congress will do. But I would say that the more
streamlined, the better. What HUD does is follow the rules.
When Congress tells us how to do something, that is what we do.
Mr. Loudermilk. Well, I understand that, but with two sets
of rules for two different types of programs that want to
accomplish the same thing, it gets very convoluted, and State
and local governments already have enough trouble dealing with
the Federal Government.
But with only 4 percent of the funds making it down there,
it seems to me that if we could get a functioning rental
assistance program into place, would there be a need for an
eviction moratorium?
Secretary Fudge. Well, I think that the one thing that we
don't talk about is that the fact that these funds were put in
place because of an emergency situation.
I think coming out of COVID--either way, we would have
needed it because of COVID. I don't know that as a general rule
we would, but certainly because of COVID, I would say yes.
Mr. Loudermilk. Okay. But even with COVID, only 4 percent
being distributed--it seems to me that if we could just get the
money to the people who need it, we wouldn't have to have the
eviction moratorium.
With that, Madam Chairwoman, I yield back.
Chairwoman Waters. Thank you.
The gentlewoman from Iowa, Mrs. Axne, is now recognized for
5 minutes.
Mrs. Axne. Thank you, Madam Chairwoman, and thank you,
Secretary Fudge, for being here. It is great to have you here
today.
I want to start with a question on rental assistance. I
know this has been run out of the Treasury. But I also know
that HUD has been helping State and local groups trying to run
those programs.
Iowa's State program has not done well in getting this aid
out. I believe at the end of June, they had given out just
about 2 percent of the funding they had received.
However, I don't quite understand why my Republican
colleagues here on the other side of the aisle are so hung up
on the Treasury here.
I have a local program in Polk County that has now given
out more than two-thirds of the funding. It is the largest,
most populated county in the State. So, we can get it out there
and to the folks who need it, but, apparently, our State
Government can't.
Clearly, this is not a question of the rules preventing it.
It is about, really, communities who have the will and the
knowledge to get the funding out and support the people
properly.
Secretary Fudge, my question is, can you share some of what
HUD sees as best practices here so we can encourage our States
to adopt those?
Secretary Fudge. The easiest thing is for communities,
whether it be the State or the county or whomever, to work with
people who do this every day.
Most people who are at risk of eviction either have worked
with social workers or we know who their landlords are. We need
to do the work. They need to do the work. They want it to be
easy.
But they have to start to talk with people on the ground
who are doing this every day. It is not hard to find out who
they are and to get them the resources. But we also have made
it somewhat cumbersome for the renters.
We assume a certain amount of sophistication for renters to
get the resources because we are putting the onus on renters,
really, to come and ask for the resources. So, we have to find
another way to reach those renters and to get them the kind of
information they need to get those resources out.
Mrs. Axne. I look forward to continuing to work with you on
those opportunities, and I will make sure to talk with the
State about that.
They sound like good ideas and I, certainly, know that as
you mentioned, in Polk County, they actually are working with
those local groups. So, you are right, it works.
I did want to also point out another thing I am wondering
about. Our governor decided not to give people the 3 months of
forward rent that they could, and to me, it seems like a pretty
clear way to provide help to people without making the same
person apply every single month, and it is also going to make
administering of this easier as well.
Is that something that you have seen elsewhere and do you
agree that this would raise costs if people have to apply
repeatedly?
Secretary Fudge. There is no question, and one of the
complaints we get is that it is too much paperwork. So, why
create additional paperwork?
Mrs. Axne. Okay. So it would be a good thing for us to
continue to move forward with that? It would ease up the
pressures on the application process?
Secretary Fudge. Absolutely.
Mrs. Axne. Thank you. I do hope that our State Government
can put this in place as it reconsiders passing up the
opportunity to help more renters in the second round.
I would like to move on now to something that I think could
help with affordable housing across this country, and that is
manufactured housing, which I think can be part of our solution
to helping get a good solid roof over folks' heads.
However, for those who own the home itself but rent the
land, they don't get that benefit if the rent gets jacked up to
levels that they can't afford, or if the landlord kicks them
out for no reason, forcing them to sell their home, sometimes
at a major loss.
I actually had a constituent who had to sell their home for
a 40-percent loss of what she paid for it just 3 years earlier,
because of these predatory tactics.
Secretary Fudge, do you think there is more that we can do
to make manufactured housing communities work as affordable
housing that truly prioritizes the tenants rather than solely
focusing on extracting profit?
Secretary Fudge. Yes, we can, and I have spoken with the
manufactured housing group. I have also spoken with tenants of
not just public housing, but manufactured housing as well.
And we are trying to work through some issues that we think
are going to be helpful. But they know that there is a problem,
and we know that there is a problem, so I do believe it can
work.
Mrs. Axne. And are you pulling together best practices from
some of those landlords who are doing the right thing?
Secretary Fudge. Oh, absolutely.
Mrs. Axne. Okay. I would love to see some of those if we
get a chance. Thank you so much for doing that.
It is why I introduced a couple of bills to get these
protections in place so things like this don't happen. Just so
you know, I have the Manufactured Housing Tenant's Bill of
Rights that would increase protections for renters in
federally-backed properties, and the Manufactured Housing
Community Preservation Act that provides grants to resident-
owned groups and others who might want to step up and own the
places themselves and give those benefits to the residents.
So, I hope we can work together on those to get people more
protected and safe in their homes that they currently live in,
and also give other folks more opportunity for affordable
housing.
Thank you so much, Madam Secretary, for all that you are
doing, and thank you for helping us move this agenda forward
with the American people.
I yield back.
Chairwoman Waters. Thank you.
The gentleman from Ohio, Mr. Gonzalez, is now recognized
for 5 minutes.
Mr. Gonzalez of Ohio. Thank you, Madam Chairwoman, and
welcome, Secretary Fudge, my friend. It is good to see you. We
miss you in Cleveland, but Cleveland is so very proud of you
and we are grateful for your continued service to the country.
I want to start off by talking about something we have
spoken about in private, which is veterans' homelessness. That
is something that is a big issue in our country, and it's
certainly a big priority of mine here in Congress.
In your written statement, you noted that HUD's mission is
to create strong, sustainable, inclusive communities and
quality affordable homes for all.
As you know, this certainly means ensuring that our
veterans have access to affordable housing after serving our
country. I believe no veteran should have to worry about having
a roof over his or her head. Currently, throughout the United
States, there are still far too many veterans who are homeless,
and countless more who are at risk of losing their homes.
What more do you think we can be doing through HUD in
collaboration with the VA and those who serve our veterans to
extend more housing opportunities?
Secretary Fudge. That is a really great question, and I
tell you, it is something that I wrestle with every day, and I
have had the opportunity to speak with Secretary McDonough.
There is no reason, first off, in this nation that anyone
should be homeless, but especially those people who have served
their nation with such distinction.
And so, we are trying to find more ways. We have right now
in our system, unused at HUD, more than 20,000 vouchers for
veterans. We have in this budget, the President's budget, when
we reauthorize them, almost 100,000 vouchers. We are just
trying to make sure that we can find a way to get them to the
veterans who are homeless, and we are doing better, certainly.
But it takes a concerted effort, because the one thing
about veterans is that they are resilient. So, when they get
into these communities they become in charge of these
communities. It becomes a culture.
We are breaking down the barriers every day.
Mr. Gonzalez of Ohio. That is great, and I look forward to
working with your office more on figuring out how we can get
those unused vouchers out. If we already have them out there,
let us make sure our veterans are using them and they are
getting into their hands.
As far as the emergency rental assistance dollars, I know
that reports are being produced and that has been a big topic
of conversation. In those reports, will there be special--not
special call outs, but will we be reporting on the status of
veteran homelessness in there or will that be in separate
reports?
Secretary Fudge. It is really separate. They will come
through the VA, but I will make sure that we get you that
information so that you can have it.
Mr. Gonzalez of Ohio. Fantastic. Thank you.
And then another issue I know you care passionately about,
and that impacts northeast Ohio disproportionately compared to
the rest of the country, is the issue of lead paint in older
housing.
Ohio has the third-most Housing Choice Voucher units in the
country which were built prior to 1978, only behind California
and New York. This can have serious impacts on the health and
development of children, as we know, who are exposed, and it is
something I believe we need to address head on.
What more can we do on the preventative side to identify
housing that has lead-based paint and make sure that northeast
Ohio families are kept safe?
Secretary Fudge. It is a passion of mine, and it almost
brings me to tears to talk about it. In Cuyahoga County alone,
1,000 children annually--annually--are poisoned to the extent
that they cannot function in the county I live in. Just about
all of the children in the public schools have elevated levels
of lead. We must find a way to do something with lead paint in
public housing.
The resources have been requested in the President's
budget, and I just need for people like you, Mr. Gonzalez, to
help me fight for it.
Mr. Gonzalez of Ohio. Well, I will continue to do just
that, and I look forward to working with you on the lead paint
issue, veterans' homelessness, and the priorities of this
committee.
And with that, I yield back.
Chairwoman Waters. The gentlewoman from Massachusetts, Ms.
Pressley, is now recognized for 5 minutes.
Ms. Pressley. Thank you, Chairwoman Waters, for convening
this important hearing, and thank you to Secretary Fudge for
being here today. What a welcome change. I am overjoyed to see
that we have someone dedicated to exacting housing justice back
at the helm of the Department of Housing and Urban Development.
In May 2019, former Secretary Carson came before this
committee and refused to answer any of my questions. I asked if
he thought safe housing was a social determinant of health. He
refused to answer. I asked if he thought substandard housing
conditions posed a threat, a risk to tenants' health. He
refused to answer. I asked if my constituents deserved to live
in housing filled with life-threatening mold. He refused to
answer. And then, to no one's surprise, he repeatedly tried to
cut funding for long-overdue repairs.
Unlike the prior Administration, Secretary Fudge, which
simply avoided the problem and slashed much-needed resources,
President Biden, as you alluded to in your opening statement,
has proposed a budget and a Build Back Better Plan which
increases such efforts and includes billions in funding to
address the public housing repair backlog and millions to
remove lead-based paint and other health hazards.
Here in Congress, we are working urgently to make good on
those proposals, and I appreciate having good partners in this
fight. But there is also work that HUD can do on its own,
without Congress, to improve inspections and repairs to HUD-
subsidized units, work that your Administration undoubtedly has
inherited but now has an opportunity to address, once and for
all.
With HUD Real Estate Assessment Center (REAC) inspections
cautiously resuming following the unprecedented pause during
the pandemic, we have a responsibility not just to return,
again as you alluded to in your opening statement, to an unjust
status quo normal, but to build a new normal, one which ensures
that everyone has a safe, clean, and healthy place to call
home.
Secretary Fudge, how long, on average, does it take for a
property that failed its REAC inspection to make the repairs
and then to receive a passing score? Is this data that is
currently tracked?
Secretary Fudge. I don't know that we track the exact
length because every situation is a little different in terms
of the agreements that they have. What they try to do is make
an agreement with the landlord, if it is Section 8 or some
other. But let me just say this. The reason that I demanded
that we start inspections again, to the concern of many people,
is because I believe in the dignity of people who live in these
places. And so, we are trying to speed up the process.
What I have asked them to do is give me a list of the worst
properties in their areas, and when they are going to get in
them and look at them. I don't want to hear about concerns they
may have. People are depending on us. And so, I have asked for
the list of the top 10 worst properties in every single
community we serve, and it is my expectation that within a 30-
day period, they will look at every single one.
Ms. Pressley. Thank you, Madam Secretary. Certainly, that
transparency is so critical. I am a believer that that which
gets measured, gets done, so that transparency is very
important.
Would you be open to working with our office to perhaps
explore ways that this data could be collected and reported in
order to ensure that HUD is meeting those oversight
responsibilities?
Secretary Fudge. I would be happy to, because we should
have already been collecting that data.
Ms. Pressley. Thank you. I certainly, throughout my
district, the Massachusetts 7th, continue to hear complaints
from constituents that some housing providers take years to
make those improvements, after having a failing REAC score.
Some have shared, in fact, that in past year they have been
skeptical about whether HUD followed up promptly after the
provider claim to make repairs. So again, I appreciate your due
diligence on this front.
Just a couple more questions in that vein. When properties
fail inspections are there any strategies currently under HUD
to bring properties back into compliance quickly and
efficiently? Is there a prompt?
Secretary Fudge. There are procedures in place. I just
think that for so long, we have been somewhat lax in following
up. I think also we go overboard because we know that people
need the housing. I think that prior Administrations have been
more lenient than I would be. If they are not going to let
people live decently, I don't want them to have taxpayer
dollars, period.
Ms. Pressley. Agreed. Simply because someone could not
afford more doesn't mean they don't deserve better. So, I thank
you for your partnership and your commitment to ensure that the
time between a failing REAC score and a completed repair is as
short as possible.
Chairwoman Waters. The gentlewoman's time has expired. The
gentleman from Texas, Mr. Taylor, is now recognized for 5
minutes.
Mr. Taylor. Thank you, Madam Chairwoman. Madam Secretary,
thank you for being here. I was gratified in your opening
comments that you said the United States of America is the
greatest nation on Earth. I just wanted to give you a chance to
say why you thought that. And yes, that is a slow pitch.
Secretary Fudge. I think one of the things that makes us a
great nation is that we, as a people, have always been able to
see our problems and to repair our faults. We want to be the
leaders of the world. We are the people who lead the world in
so many things.
Are we a perfect nation? No. Are we a great nation? Yes. We
are a great nation because our people are good people.
Mr. Taylor. Thank you. That was a great answer and I
appreciate that.
In the vein of trying to correct faults, I am sure you are
aware, under current law, 18 USC Sec. 1001 that it is a crime
to knowingly make material, false, fictitious, or fraudulent
statements or representations to the Federal Government. So in
the vein of finding fraud, what are your thoughts on using new
technology or artificial intelligence to find fraud, to stop,
whether it is a real estate developer, like what Ms. Pressley
was talking about earlier, that is not coming through the way
they should, or whether it is a pretend tenant who is taking
advantage of our programs? I know you have finite resources.
Have you thought about artificial intelligence as a way to find
fraud?
Secretary Fudge. I really haven't, because it has not been
proven to work all the time. And so, I would rather err on the
side of a person who needs help than not.
Mr. Taylor. What would you think about looking at different
programs--I will let you think about this--to use artificial
intelligence (AI) on a test basis, on a pilot basis, to try.
Because as we know, many financial institutions are using AI in
underwriting, to eliminate fraud and to be more effective in
the way that they allocate credit. And so if we think about
that, reapplying it in this case, trying to make sure that we
are giving help to where help is needed.
Secretary Fudge. I am certainly willing to give it some
thought. It is not something that I have given any thought to
prior to your question. But we are always trying to make sure
that people are treated better, that the Federal Government
operates better. I am certainly willing to think about it.
Mr. Taylor. Sure. And obviously, I think we can both agree
that your resources are limited and your needs are great. So, I
think we can agree we want to focus resources where they are
indeed needed.
And in that vein, what are the limits of helping people at
HUD, the financial limits? You can perhaps educate me on what
those limits are. And do you think they are perhaps too high?
Secretary Fudge. Which limits? I am not sure.
Mr. Taylor. Income limits.
Secretary Fudge. Oh. No, I don't think so. I don't think
that the income limits are too high at all. I think that as we
look at where this nation is evolving as it relates to housing,
as it relates to what a dollar can buy you, as it relates to
what it costs to buy food or to build housing, I don't think we
are too high at all.
Mr. Taylor. Is there a point where you would say that
person is making too much money--hey, you're at 700 percent--
Secretary Fudge. Yes. We have rules, of course. We have
guidelines. We don't just say any person making any amount of
money can be serviced by HUD. We obviously have guidelines. And
most of those are generally 80 percent of the average median
income, or less.
Mr. Taylor. Okay. So, 80 percent is the general standard
that HUD uses to determine when someone can no longer receive
aid?
Secretary Fudge. Correct.
Mr. Taylor. Okay.
Secretary Fudge. Of the average median income, because
every community is different, so the dollar amount is different
in every community.
Mr. Taylor. Sure. And I just--
Chairwoman Waters. The gentleman's time has expired. No,
there are another few seconds.
Mr. Taylor. Thank you, Madam Chairwoman. I was really glad
to hear your comments on zoning. I think that zoning can make
housing extremely expensive, and in some places unlivable. And
I just want to say that I appreciated your comments. I identify
with those. I think zoning can be very hurtful to people in
terms of making housing very expensive, by putting requirements
on housing that just isn't practical. And certainly, I happen
to live in a place in Plano, Texas, where we are pretty good
about zoning, I think, and so we have relatively affordable
housing. It is causing a lot of demand for people coming from
other parts of the country, which is driving up our housing
prices.
I yield back.
Chairwoman Waters. Thank you very much. The gentlewoman
from Michigan, Ms. Tlaib, is now recognized for 5 minutes.
Ms. Tlaib. Thank you, Madam Chairwoman. And thank you,
Madam Secretary. It is so incredibly good to see you, and thank
you for being accessible right from the beginning, and meeting
with me and Congresswoman Kaptur.
As many of the folks on your team know firsthand, the Great
Recession devastated many places like Wayne County, and many of
these communities have yet to fully recover. In my district, we
faced a tax foreclosure crisis that is still ongoing. So, I
just want to thank you so much for including the Restoring
Communities Left Behind Act that Congresswoman Kaptur and I are
championing in addressing tax foreclosure but also home
improvement in neighborhoods, true grassroots neighborhood
revitalization. And again, thank you for that partnership.
As you probably know, since 2011, the Wayne County
Treasurer has foreclosed on more than 100,000 families for
delinquent property taxes, and that is nearly 1 in 4 properties
in the entire county. Madam Secretary, in Wayne County, we used
to have one of the highest Black homeownership rates in the
country. People would envy us, and wonder what we were doing.
And it was something that we always bragged about. And in 2000,
it went from 53 percent to now close to 40 percent in Black
homeownership.
So again, I applaud you for including tax foreclosure
relief in the implementation of the Homeowner Assistance Fund,
and I can't thank you enough for including the Restoring
Communities Left Behind Act.
I also know, in the City of Detroit specifically, that more
than 92 percent of our homes were overtaxed. And if I may,
Madam Chairwoman, I would like to insert into the record an
article from The Detroit News entitled, ``Detroit homeowners
overtaxed $600 million.'' I think it is important to know that
is nearly 96,000 homes that were taxed twice as much as they
should have been, and I think that continues to contribute so
much to some of the tax foreclosure issues that we continue to
see.
Chairwoman Waters. Without objection, it is so ordered.
Ms. Tlaib. Thank you, Madam Chairwoman. I know that we
don't want you to take on this role about telling localities
what to do. However, to advise or at least make a statement
that this is really something that could be violating the Fair
Housing Act.
Is there anything that HUD can do to end this? Can HUD
consider withholding CDBG funds to localities that over-assess
property tax at such a high rate, in violation of the Fair
Housing Act?
Secretary Fudge. I think there are a couple of things that
can be done. First, we follow the law, so if there is a Fair
Housing violation, we want to know about it, we will
investigate it, and we will do whatever is necessary to make
sure we get it correct. So, the first thing I would hope that
you would do is to contact our office, or just tell me, and I
will make sure that our Fair Housing people take a look at it.
And there are conversations we can have about resources coming
to communities.
Ms. Tlaib. Yes, I will be more than willing to make sure--
there was a study by the University of Chicago and many others
which shows that the overassessment continues.
Again, one of the things that I know the Department can
take steps, and I enjoyed the fact that you say, ``follow the
law,'' because one of the things is to codify, really identify
which localities are over-assessing homeowners right now and
how that is contributing to the tax foreclosure. Have there
been any discussions, in the previous Administration or now,
about some sort of database or recording of over-assessment
around the country, that you might know of?
Secretary Fudge. Not that I am aware of, but I will check.
Ms. Tlaib. Okay. Wayne County property taxes account for 60
percent of the County's general fund revenue, and you know what
means. That is why I am hoping to have your partnership and
leadership, Madam Secretary, at the Federal level, at least to
call out when it is wrong to do it, to at least show some sort
of alignment with property owners, and many of them, again, are
Black property owners, that this crisis needs to be addressed
and that HUD will definitely be able to, or in some way show
that this is wrong and that we need to do something about it
and push back against many of those efforts.
Secretary Fudge. I just want to say, just rest assured, I
was the mayor of a small city that was predominantly Black, and
I am a lawyer by training. So we are going to follow the law,
and we are going to do what we can to make sure it is done
properly.
Ms. Tlaib. I appreciate that, Madam Secretary. I am also
extremely grateful, Madam Secretary, for the conversation
earlier this year on our bill, and I am so incredibly happy to
see Chairwoman Water's $10 billion towards the program, the
Housing is Infrastructure Act. Does the Administration support
this funding? I know you talked a little bit about it, but can
you talk about next steps and maybe, again, you have this
committee, many of us are very much in support of that, of any
actions by the Administration in pushing that forward?
Secretary Fudge. At this point--
Chairwoman Waters. The gentlewoman's time has expired. The
gentleman from Tennessee, Mr. Rose, is now recognized for 5
minutes.
Mr. Rose. Thank you, Chairwoman Waters and Ranking Member
McHenry, for convening the hearing today, and welcome,
Secretary Fudge, back to the House and to your first time
before our committee. I am a recovering lawyer as well, so I
feel like I have some appreciation for your plight.
I think this hearing is long overdue. HUD was tasked with a
significant role in response to COVID-19, but in my opinion,
unfortunately, it has failed to live up to the
responsibilities. Specifically, I have been extremely
disappointed with the slow rollout of the rental assistance
programs as well as HUD's development and implementation of
confusing guidelines. Congress appropriated $46 billion in
rental assistance, and as we have heard repeatedly today,
almost 7 months after that initial funding, data shows that
less than 4 percent of that money has actually been used to
help eligible households. This is putting millions of families
at risk of eviction and severely hurting landlords across the
country.
Under the previous Administration, Treasury issued binding
Emergency Rental Assistance (ERA) program rules and FAQ
guidance to accompany those funds on January 19th. The Biden
Administration then opted to rescind that guidance and publish
new ERA rules in February. It then revised rules again in
March, then added new rules in May, and then revised and added
new rules again in June.
Secretary Fudge, how has this constant revision of rules
and added red tape slowed ERA funds from helping eligible
families and households who are in need?
Secretary Fudge. Well, it really hasn't slowed it, because
you remember that the money actually came out of Treasury, and
it went immediately. The rulemaking, I agree, has probably been
somewhat cumbersome. I don't disagree with you on that. But it
has not been the problem with getting the resources out.
Mr. Rose. I am concerned that housing policies coming out
of the White House and HUD are simply throwing money at old,
outdated programs that will not build or incentivize the
creation of new housing units. Several modern, innovative
programs do exist, and they are working well in States like
mine. My friend from Arkansas, Mr. Hill, emphasized how the RAD
program is a proven solution that allows residents greater
choices and flexibility.
Secretary Fudge, could you expand on some of the benefits
that the RAD program has created for public housing authorities
and residents of public housing?
Secretary Fudge. Well, obviously, the advantage is that
they leverage the resources that the public housing authorities
already have, and it gives them the opportunity to do more
things, especially as it relates to capital improvements, than
they could have just through the resources that this Congress,
in its wisdom, gives them.
Mr. Rose. Since the Biden Administration's prior proposals
included putting tens of billions into retrofitting public
housing, is that a step away from successful programs like the
Rental Assistance Demonstration (RAD) program?
Secretary Fudge. Oh, absolutely not.
Mr. Rose. What do you think the Administration should do to
seize the opportunity that RAD creates?
Secretary Fudge. RAD is expanding all over the country. No
one is trying to do away with RAD. I don't know if that is what
you are thinking. But what we want to do is to take care of the
people in public housing. We want to be sure that they live in
safe, decent housing. We want to be sure that we can fix
leaking roofs and take mold off of walls. We want to be sure
that we don't have rodent infestation. We want to be sure that
they are living in a decent environment. And if RAD helps to do
that, that is great. We are all for whatever it is that we can
do within, obviously, our responsibilities and our authority to
make sure that people live in decent housing.
Mr. Rose. Thank you. In Tennessee's 6th Congressional
District, which I represent, 12.9 percent of total occupied
housing units are manufactured homes. Manufactured housing is
the most affordable homeownership option available nationwide
for minorities, underserved, and low-income borrowers.
According to U.S. Census data, 90 percent of new homes under
$75,000 are manufactured housing, yet increasingly, we are
seeing scenarios where localities use zoning ordinances to
exclude affordable manufactured homes in their communities. HUD
has the authority to prevent localities from excluding
manufactured homes, yet they have not utilized it.
How can HUD encourage communities to expand their
affordable housing options like manufactured homes?
Secretary Fudge. I would disagree that HUD has the ability
to change local zoning. We do not.
Mr. Rose. So, you don't see a way that HUD can help to
encourage communities?
Secretary Fudge. We are working on it, but we do not have
the authority to change local zoning.
Mr. Rose. Okay. Thank you, Madam Chairwoman, and I yield
back the balance of my time.
Mr. Green. [presiding]. The gentleman's time has expired.
The Chair now recognizes the gentlewoman from Georgia, Ms.
Williams, for 5 minutes.
Ms. Williams of Georgia. Thank you, Mr. Chairman, and thank
you, Secretary Fudge, for joining us today. Today's hearing
builds an important foundation for our shared work to ensure
that low-income families and those most marginalized are well-
served by HUD's programs.
As we move forward with this work, we need to focus on
breaking down barriers that folks face getting a decent home,
but we also need to be thinking about how we can maximize
opportunity and minimize disparity through the housing system.
I have legislation, the Voters on the Move Registration Act,
included as a part of this hearing today, and it helps ensure
that as we get individuals housed, we also break down any
barriers they face in getting registered to vote at their new
residence.
My bill would task the Consumer Financial Protection Bureau
(CFPB) to work with the Election Assistance Commission to issue
information on how individuals who are moving can register to
vote and what their voting rights are under the law. This will
ensure that public housing agencies and owners of federally-
assisted housing can provide this information and make moving a
little bit easier for their tenant. This bill is based on a
simple idea: It shouldn't matter how often you have to move or
what ZIP code you are moving to. People should have the tools
they need to exercise their voice in our representative
government.
Secretary Fudge, how can empowering tenants in HUD's
programs with more information as they move, whether it is
about their rights or services that they can access, help to
reduce socioeconomic disparities for the populations that those
programs serve?
Secretary Fudge. Well, I would say that people
underestimate people who live in public housing. Most people
who live in public housing do want to know what their rights
are. They do want to understand how they can become more
involved in their communities. That is why we have more and
more tenants' associations. That is why they are asking for
more information. They want computers in their community rooms.
They want to be able to be a contributing member of society
like everybody else. And I think that it is great.
Ms. Williams of Georgia. Thank you so much, and I have no
additional questions. I am looking forward to working with you
on implementing this program and getting everyone the access
and information that they need to continue to voice their
concerns and be a part of our representative government.
And, Mr. Chairman, I yield back the balance of my time.
Mr. Green. The gentlelady yields back. The gentleman from
Missouri, Mr. Luetkemeyer, is now recognized for 5 minutes.
Mr. Luetkemeyer. Thank you, Mr. Chairman. Congressional
Democrats are falling woefully short on their responsibility to
conduct oversight of the Biden Administration, and the American
people need to know about it. Currently at the CFPB, we have an
acting Director who has not been confirmed by the Senate,
making major policy decisions. He has taken nine enforcement
actions, rescinded Administration guidelines on CFPB's policy
for combatting abusive industry practices that delay the
implementation of the debt collection rule, and is moving full
speed ahead on a rule to implement Section 1071 of Dodd-Frank.
Furthermore, there have been reports that the CFPB has used
incentive packages and started investigations into senior
career staff in order to remove them from the Bureau due to
their political affiliation. This could potentially violate the
Civil Service Reform Act.
And while the acting Director has been busy leaving his
mark at the CFPB, the chairwoman can't find the time to have
him testify before this committee. In fact, at the end of this
month it will have been a full year since someone from the CFPB
testified in this committee. Conversely, when Director
Kraninger was the head of the CFPB, and Chairwoman Waters took
over the chairmanship of this committee, it took only 2 months
for her to call up the former Director.
As far as this committee hearing goes today, the single-
most pressing housing issue that this country is facing is the
eviction moratorium, which is set to expire July 31st. While
multiple courts have ruled the eviction moratorium is
unconstitutional, Congress responded to the crisis facing
renters by passing $46 billion in renter assistance.
The idea is simple. If Congress provides you the money, you
pay your rent, you pay your back rent, and you will not be
evicted. However, to date, Treasury has reported only $1.5
billion of the $46 billion given to the program has actually
reached renters.
Why the ineptitude by Treasury? Could it be that the
Treasury Secretary has completely abandoned any sense of
ownership or oversight of these programs or refuses to appear
in front of Congress to discuss them? Secretary Yellen is
statutorily required to appear in front of this Financial
Services Committee on a quarterly basis to discuss the pandemic
and the economic recovery. It was agreed to, on a bipartisan
basis, in the CARES Act, and was even maintained in the
partisan Democratic bill passed this March.
But where was the Secretary last quarter? The answer is,
absolutely nowhere near this committee. Unless she plans on
appearing in September, it will mark two consecutive quarters
where she has broken the law by failing to appear before us.
I also serve as ranking member of the House Small Business
Committee. Secretary Yellen was statutorily required to testify
in front of the Small Business Committee before April 26th of
this year on the Paycheck Protection Program (PPP), but to no
one's surprise, she has yet to appear there. I am aware of her
schedule, and she has attended at least two political events
and made an overseas trip. Now, I am not complaining about her
doing those things, but I am making the point that if she has
time for that, she has time to do her statutory duty, which is
to appear here.
What's worse is that I think our colleagues across the
aisle don't seem to want to hold Biden appointees accountable,
and I think it is this woeful neglect of the law that is at the
expense of the American people's view of it that is going to
take its toll.
With that, let me begin my questioning. Secretary Fudge,
welcome, by the way. One of the largest drivers of housing
affordability is the lack of affordable housing. Specifically,
during the pandemic, we have seen the impact of low housing
stock on home prices. According to the National Association of
Home Builders, and the National Multifamily Housing Council,
regulations imposed by all levels of government account for an
average of 32 percent of multifamily development costs. In
fact, on a quarterly basis, that number is at least 42 percent.
What is HUD doing to eliminate or minimize these kinds of
costs to multifamily developments?
Secretary Fudge. I have had an opportunity to meet with the
Home Buyers, and certainly, HUD is not responsible for the cost
of lumber or plastic or anything else. But what we are trying
to do is to assist Commerce and other agencies who look at the
supply chain.
My colleagues, for many, many years when I was here, talked
about the free market. It is a free market. That is what we are
dealing with. And so, there is nothing that HUD specifically
can do to bring down the cost of housing--
Mr. Luetkemeyer. Is there something--
Secretary Fudge. --other than through the programs you all
have approved to get funding, whether it be the Housing Trust
Fund, whether it be CDBG, whether it be HOME--
Mr. Luetkemeyer. Okay. My time is running short here. I
apologize. My question is, 32 percent of the multifamily
housing costs are development costs, and 42 percent in other
cases. So, the number is huge on rules and regulations. Is
there something that you think you can do to help minimize
that?
Secretary Fudge. Well, that is what I was saying. We are
trying to provide gap financing. Let's just say that a cost of
a home now is $32,000 more than it was a year ago. Through
things like HOME, things that Congress has approved--HOME,
through low-income housing tax credits, through all of the
other things, the tools you have given us, we can at least
bring down the cost for the end user. We can't bring down the
cost of the unit itself.
Mr. Luetkemeyer. Well, that is problem. The building
costs--
Mr. Green. The gentleman's time has expired.
Mr. Luetkemeyer. --on the front end are where the costs
are, and we have to minimize that somehow--
Mr. Green. The Chair--
Mr. Luetkemeyer. --and we should--
Mr. Green. --will now recognize the gentleman from
Massachusetts, Mr. Auchincloss, for 5 minutes.
Mr. Auchincloss. Thank you, Mr. Chairman, and welcome,
Madam Secretary. I did not have the pleasure of working with
you in Congress, but I am looking forward to working with you
in your new position, especially as housing is probably the
single-biggest issue in the district I represent, the
Massachusetts 4th. I represent a socioeconomically-diverse
district where, in the inner suburbs of Boston, housing prices
can be well above $1 million, and in the southeastern part of
Massachusetts, less than a fifth of that. But north and south
of the district, housing is always at the top of people's
minds, and we have seen double-digit increases in the price of
housing over the last several years.
And I am pleased that Massachusetts has started to step up
in this area. Late last year, the State legislature passed the
Housing Choice Bill, which reduced from a supermajority to a
simple majority the vote count required for zoning boards to
approve special permits, to make it easier to build housing at
the local level. It is not exhaustive but it is a good first
step to alleviate the pressure in the housing market,
especially in the parts of the district where demand greatly
outpaces supply and zoning has become really exclusionary.
Understanding that HUD cannot directly change zoning laws,
are there other steps that you would like to see Massachusetts
and the other States of the union, in your experience working
on housing for so long, do to encourage more housing through
statutory changes?
Secretary Fudge. Yes. We know we can't change it but we are
having discussions. We are trying to find ways to even just
bring to their attention some of the ordinances that they may
have that are detrimental. As a mayor, I didn't go back and
look at things we did 30, 40, or 50 years ago. But when someone
brings to my attention, ``You know what? If you just change
this one small thing, that may bring down the cost of
housing.'' So, we are having those discussions.
But we are also trying to say to them that we have, through
Congress, increased funding in our Housing Trust Fund, which is
designed to assist with building or providing housing for low-
and moderate-income people. Use those resources to help you
make that housing affordable.
We have CDBG and HOME money--HOME money is very, very
flexible--that can provide some resources to assist the end
user. Let's say that it costs them--and I am using a small
number, obviously--$50,000 to build a home, but the average
person, the low- or moderate-income person, can only afford
$40,000. We can make up that $10,000 difference.
So, there are tools that Congress has given us that we can
use. It is just that we need the local communities to help us
do it.
Mr. Auchincloss. And Madam Secretary, can we work with your
office on that, as we explore housing issues?
Secretary Fudge. Absolutely.
Mr. Auchincloss. Thank you. Now in the southern part of my
district, the City of Fall River is registering abandoned
housing and working with the State to bring that housing up to
code. And there are many communities that are working hard to
return these kinds of abandoned properties to clean and
habitable places to live. Are there programs that HUD is
pursuing that make it easier for cities like Fall River to
upgrade abandoned properties and turn them into habitable
places to live?
Secretary Fudge. Yes, we have all kinds of low-income
housing, if that is what you are asking me. And if you just
call our office, we can give you all the information that you
need, because a lot of times, small communities don't even know
what is available. We would be happy to do it.
Mr. Auchincloss. I appreciate that, Madam Secretary. And
then the final question I want to build off of is what the
gentlewoman from Michigan was asking before her time expired,
that the chairwoman has proposed a transformative series of
bills, including Housing as Infrastructure, and I want to give
you the opportunity, Madam Secretary, to just tell this
committee what you think this funding and this policy put
forward by the chairwoman could do for housing stability and
housing access in the country?
Secretary Fudge. Well, if you would allow me, I won't
discuss the various parts of the legislation, but I will say to
you that housing is probably the number-one crisis in this
country today. And whatever it takes for us to start to address
it, I don't know if it is that piece or a lot of pieces of
legislation. But if we do not address this crisis now, it is
just going to continue to get worse.
Housing was a crisis before COVID; all COVID did was to lay
bare how big of a crisis it was. And if we do not take this
opportunity to invest in housing, as we have not done in
generations, we will never be able to catch up.
Mr. Auchincloss. Thank you, Madam Secretary, and I yield
back the balance of my time, Mr. Chairman.
Mr. Green. The gentleman yields back. The gentleman from
South Carolina, Mr. Timmons, is recognized for 5 minutes.
Mr. Timmons. Thank you, Mr. Chairman. Secretary Fudge,
congratulations on your new position, and thank you for being
with us today.
I want to begin by associating myself with my colleague,
Representative Beatty, when she said that you are not
accountable for the actions of Secretary Yellen. She is right.
You are not directly responsible for the administration of the
emergency rental assistance dollars. But I think we can all
agree that this is a critically important issue, and since
Secretary Yellen is not here and will not appear before this
committee before the eviction moratorium expires at the end of
the month, it is our responsibility to do whatever we can to
push this issue to the forefront.
I also think that we can all agree that there remains a
great need to get these dollars not just in the hands of State
and local governments. but actually to the intended targets:
renters and their landlords. We can all surely agree that is
the goal.
Mr. Hill said earlier that the legislation was drafted in a
way that does really put the onus on State and local
governments to run this program, and we can see that they are
just not doing a very good job. You also said earlier that our
job is to provide oversight, and we are trying to do that but
it is just not working. The dollars are not getting where they
need to go. And obviously, we know time is running out.
You also said earlier that you don't even know how much
money has actually made its way to the tenants who are in need,
and you have only been on the job for a few months so that is
not your fault. But we need to find out, and we need to get
this done quickly.
So my question is, can you help us find out just how much
of the $40-plus billion we appropriated has reached its
intended target, and can you please help get these resources
where they need to go?
Secretary Fudge. Yes, I will do everything I can to make
sure you have it. I will get in touch with Treasury to see if I
can get those numbers for you, as well as yes, we are
continuing to talk. We do have oversight but we just can't
demand.
Mr. Timmons. I have only been here for 2\1/2\ years. You
have spent more time in this body than I have. So, what else
can we do that we are not doing?
Secretary Fudge. One of the things that I did when I was a
Member of Congress was, I would go and talk to my State and
local people, and tell them what needed to be done. I was
proactive in making sure that they knew what was happening, so
I didn't sit back. I really went and took the initiative to say
to them, ``If you don't do this, you are failing your own
constituents.'' As Members of Congress, you all have
constituents. I have them too. They are people who live in
housing that we support. And so, we do the best we can to make
sure we can be helpful.
Mr. Timmons. Maybe if there are any resources that you
could provide to give us best practices on how to actually
achieve these objectives, I would really appreciate that. And I
just want to say thank you for your help in achieving this very
important objective.
I want to switch gears to vaccine hesitancy. During your
exchange with Mr. Cleaver, you ran through the Biden
Administration's efforts to vaccinate Americans living in
public housing against COVID-19, and I appreciate those
efforts. I have been telling everyone in my district who wants
to get a vaccine, that they need to get one, because we have to
get back to work and we have to get on with our lives.
So, I want to go to some of the words that we heard during
the election. I guess Vice President Harris, then candidate
Harris, said, ``If past is prologue, the scientists and health
officials will not be able to weigh in on the efficacy of the
vaccine. They will be muzzled. They will be suppressed. They
will be sidelined.''
So when we look at the vaccine hesitancy amongst
demographic groups, we see that rates, particularly in African-
American communities, are not where they should be. My question
is, what can we do to help fix this problem? What can we do to
help repair the trust in government?
Secretary Fudge. Well, there are a couple of things. One,
obviously, is there is a justified distrust by African
Americans of the government, because even today, more Black
women die in childbirth than any other color. More doctors
ignore problems that Black people have than ever before. And
so, there is a justified distrust, especially in medicine.
But I think that what we have to do is go to the people,
which is something that we historically do not do. It does not
bother me to go into a public housing facility and talk with
them about getting the shot. Because I think that when people
they trust talk with them, whether it be their pastor, the
college coach, the high school coach, people like me, people
like you, I think that they have a different outcome. And so, I
am hopeful that all of us will realize how important it is to
have one-on-one conversations. I think that can turn the tide.
Mr. Timmons. Well, I hope that everyone who wants a vaccine
can get one as quickly as possible, because we do need to get
back to work. That is the only thing that is going to help get
our economy back on track. So thank you, Madam Secretary, and
Mr. Chairman, I yield back.
Mr. Green. The gentleman yields back. The gentlewoman from
North Carolina, Ms. Adams, is now recognized for 5 minutes.
Ms. Adams. Thank you, Mr. Chairman. ``Madam Secretary,''
what a wonderful sound that is. First of all, I want to say
what a pleasure it is to have you here today. I was honored to
serve with you in this body, and I am grateful for your
excellent leadership at HUD, and I thank you for showing up in
my district when we asked you to speak.
Secretary Fudge, you touched on Section 8 vouchers and
source-of-income discrimination. Currently, in my district,
there is an 11-year waitlist to receive a voucher, and what's
worse, 21 percent of the families in my district who received
the voucher were unable to find housing by the time the voucher
expired, which is 180 days.
Can you describe why it is so important that we move
swiftly to end source-of-income discrimination nationwide, and
what is the possibility of expanding that 180 days and also
issuing more vouchers?
Secretary Fudge. Well, three things, and thank you so much.
It is nice to see you as well.
Source-of-income discrimination has been around a long
time, even just Social Security. We have people who--and it has
always been a little crazy to me because they know they are
going to get a check every month, so I have never been able to
understand why there were these issues.
But what we are finding more and more is that because of
the lack of supply, people are not accepting these vouchers,
because they know they can make so much more. So, we need to
expand the base of rental properties. You can have thousands
and thousands of vouchers, but if there is no place for them to
use them, because people are upset because they get Social
Security or they get some kind of disability check or some
other kind, we do need to find a way to legally prevent source-
of-income discrimination. We have been talking about it within
Fair Housing. We are trying to find a way to do it. And as we
get further in our discussions, I would be happy to talk to you
about where we are.
Ms. Adams. Okay. Great. Your 2020 budget calls for $100
million to support public housing conversions to a Section 8
platform under the rental assistance. So, can you explain a
little bit how HUD, under your stewardship, will administer the
rental assistance in such a way that long-term affordability
and public oversight is maintained and the residents are not at
risk of losing stable housing that they can afford?
Secretary Fudge. There is no circumstance by which RAD or
any other program would be totally privately-controlled.
Generally, it is a 40/60 split, for the most part. There is a
RAD project right here in Maryland that I would love for you to
take a look at, at some point, and we will get you the
information. But trust me very, very clearly on this, I will
never, ever allow the privatization of public housing.
Ms. Adams. Thank you, ma'am. I would also like to take this
time to say that my bill, the Promoting Resident Opportunities
and Self-Sufficiency Act would help ensure that residents who
live in housing units that are converted by RAD would still
receive critical congregant housing services.
As you know, Black borrowers rely on and obtain FHA and VA
mortgage loans at much higher rates than conventional loans
guaranteed by Fannie Mae and Freddie Mac. In 2019, about 37
percent of Black home buyers bought homes using the FHA
mortgage insurance program. Despite the fact that FHA is
overwhelmingly serving Black borrowers, the overall
homeownership gap is still wider than it was in 1968. So, do
you think that the conventional market, including Fannie Mae
and Freddie Mac, could do a better job of serving more
borrowers of color, to help narrow that overall gap, and do you
have any ideas on how that might be done and what role HUD
could play?
Secretary Fudge. We absolutely can do a better job, and we
will do a better job. We are right now looking at how FHA
determines creditworthiness. We are looking at how FHA
determines which mortgages they want to do. We are looking at
small-dollar loans. We are taking every single thing out of the
box, because HUD has been as much a problem through FHA and
GSEs as anyone.
Ms. Adams. Great. Thank you, Madam Secretary, for being
here, and Chairwoman Waters, I want to thank you for inviting
the Secretary to come and address this body. And certainly, if
there is anything my office can do to assist you, please reach
out to us.
Madam Chairwoman, I yield back.
Chairwoman Waters. Thank you very much. The gentleman from
North Carolina, Mr. Budd, is now recognized for 5 minutes.
Mr. Budd. I thank the Chair, and Madam Secretary,
congratulations on your new role.
Secretary Fudge, this is a bit of a follow-up from a prior
colleague. It seems like funds that are spent on infrastructure
development would go a lot further if they were paired with
regulatory reforms that reduced the cost of construction. Fair
enough.
Secretary Fudge. Fair enough.
Mr. Budd. According to the National Association of Home
Builders, and also the National Multifamily Housing Council, up
to 30 percent of the cost of new construction, so the cost of
development of housing, is due to regulations at the Federal,
State, and local levels.
When you weighed in earlier, it is my understanding that
you said that HUD can't really help with State and local
regulations.
Secretary Fudge. Zoning.
Mr. Budd. HUD cannot, right?
Secretary Fudge. I said, zoning.
Mr. Budd. It was zoning. Okay. Just a small part of the
regulations.
Here is what is going on in my district, and I imagine in
many of our districts. People are having a hard time affording
housing. There is no ability to help. You are sending money for
bike paths, and pools, and tree planting. Now in some world,
that is actually a fine idea, but not now.
I am concerned that you have a tremendous ability to make
housing more affordable. You could make funding conditional on
lower regulations at a State and local level. But is there
anything you can do to reduce a single regulatory hurdle that
would lower the cost of housing for regular Americans?
Secretary Fudge. Let me just first say that I don't send
out money to pools. Communities do that. Secondly, I would say
to you that, as I have said earlier, we do not control States.
We control what we control based on the law. We are always
going to follow the law. But tomorrow, somebody will be asking
me why we are trying to control what their States do. What we
do is what you have authorized us to do. That is what--
Mr. Budd. Thank you. I am going to reclaim my time. And
what I see is that we have a tremendous influence here in how
the Federal Government works with States. Of course, we want to
preserve the rights of States and the strength of States and
regulations, but we want to make sure to properly steer people
to properly use Federal taxpayer dollars. I think we all could
agree with that. Thank you. And we certainly want to lower the
cost of housing for average, every day, sometimes they feel
like they are the forgotten Americans out there.
Well, I want to continue on. It is no secret that America
has a housing supply shortage. President Biden's plan is to
build, preserve, and retrofit more than 2 million homes and
commercial buildings to address the affordable housing crisis.
However, that initiative attempts to merge the building of new
units with existing units, sort of an upfit. Preserving or
retrofitting a unit might be good for its current occupant, but
that is no substitute for creating a new housing unit that
meets an unmet need.
And this is an easy math question here: How many new units
of housing are created when an existing home or housing is
retrofitted?
Secretary Fudge. Well, obviously none, but that is not what
the President did. The President asked for 2 million new units
and retrofitting 500,000.
Mr. Budd. So, we are spending a lot of that $213 billion on
retrofitting, thus not creating new units, or creating less
than otherwise could have been. So of the $213 billion the
Biden infrastructure proposal wants to spend, what sort of
percentage should be devoted exclusively to the building of new
housing units? You can give that to me in a dollar sign or a
percentage, either one, of the $213 billion.
Secretary Fudge. It is not broken down at all. It is just a
top-line number, which I think all of us know.
Mr. Budd. So do you think that some should be devoted
exclusively to the building of new housing units?
Secretary Fudge. Absolutely.
Mr. Budd. Thank you. Slightly different question before I
yield back, and just getting details on this and still awaiting
more information, I understand that three HUD nominees are on
the record supporting Defund the Police efforts. Is that
something that you would support nominees to support, defunding
the police?
Secretary Fudge. First off, I don't know if that is
accurate, because I don't know.
Mr. Budd. And we are still getting details on that. But if
that were to come up and they were on the record for supporting
Defund the Police, is that something that you would support?
Secretary Fudge. That is not my decision, sir. That is the
decision of the U.S. Senate.
Mr. Budd. So you would not weigh in on that, if that was
something they were supporting?
Secretary Fudge. I would not weigh in.
Mr. Budd. Okay. Thank you. I yield back to the Chair.
Chairwoman Waters. The gentlewoman from New York, Ms.
Ocasio-Cortez, is now recognized for 5 minutes.
Ms. Ocasio-Cortez. Thank you so much, Chairwoman Waters,
for convening this important hearing, and thank you, Secretary
Fudge, for coming before us today and sharing your expertise
and knowledge.
And I think hearing a lot of these question lines from the
other side of the aisle, it kind of feels like Groundhog Day,
right? The same two or three things that we are hearing over
and over and over again. And I think that there is some
confusion, or perhaps some of this information that you are
trying to communicate isn't quite getting across.
So, I want us to talk about the Emergency Rental Assistance
Program. For folks who are just tuning in at home, this was
developed in response to the crisis that we had due to the
pandemic. We had massive spikes in unemployment due to
shutdowns, and people were at risk of losing their homes and
being evicted. So, Congress authorized a total, in two sums, of
about $46 billion in emergency rental assistance to get to
tenants and landlords to help cover the rent during this time.
The issue that we have is that the CDC's eviction
moratorium is set to expire in 11 days, and out of this $46
billion that we have authorized, and that has been provided in
emergency rental assistance, very little of that has gone out.
Now again, as you have communicated throughout this hearing,
this is not under the domain and not due to any bottlenecks at
HUD, but you would say that this is due to State and local
municipal governments, correct?
Secretary Fudge. Correct.
Ms. Ocasio-Cortez. The checks have gone out. That money has
been disbursed. And the reason for the holdup is because
governors, mayors, municipal governments are not getting it out
to people, correct?
Secretary Fudge. Correct.
Ms. Ocasio-Cortez. So all of this hubbub about wanting to
talk to the Treasury Secretary, and you being right before us
with your expertise, I think they are trying to address the
wrong folks in this bottleneck. Would that be a fair assessment
to make?
Secretary Fudge. Yes.
Ms. Ocasio-Cortez. Thank you. And so, respectfully, if my
colleagues are concerned about these bottlenecks, they need to
get their governors on the phone, they need to get their mayors
on the phone. Would you say that is correct?
Secretary Fudge. Yes.
Ms. Ocasio-Cortez. And I would beseech my colleagues, if
they represent a State where their governor is of their same
party, to be unafraid to hold your own party governors
accountable. I say this as a person who does that within my own
party.
Now, what I will say, that I would like to engage with you
on today, is that I am concerned about some of the
communications happening with the Biden Administration
regarding the eviction moratorium date. The eviction moratorium
is set to expire within 11 days, and whether it is in Federal
control or not, the money to help people has not gone out.
So my question to you is, in your view, should this
eviction moratorium be extended?
Secretary Fudge. If I may say this, Congresswoman, I think
you are going to see significantly higher numbers of usage by
the end of this month. I can't speak for the CDC, and the only
reason it is being extended is because the CDC has said that
there is a health crisis. So, I don't know that really it is
something that can be done, if, in fact, we believe that we are
coming out of COVID.
So I would just suggest that, as you said, all hands on
deck.
Ms. Ocasio-Cortez. Okay. Thank you. And while I know that
this isn't quite under HUD, we do know, and this has come up
during the course of this hearing, that housing is a profound
social indicator of health, correct?
Secretary Fudge. Yes.
Ms. Ocasio-Cortez. And would it be fair to say that if, for
whatever reasons due to the emergency rental assistance not
coming out in time, if this resulted in a large population of
people being evicted due to this mismatch in timing and fund
distribution, could that precipitate almost a secondary public
health crisis and concern due to displacement and homelessness?
Secretary Fudge. Certainly, it could.
Ms. Ocasio-Cortez. And do you believe that the CDC should
potentially consider housing status as an indicator in health
and public health?
Secretary Fudge. No, I think that every single person in
America should be trying to figure out how we keep people in
their homes. Those are discussions that I know will come up
with the CDC, but I am certainly hopeful that we will not have
to face that.
Ms. Ocasio-Cortez. Of course. Thank you very much.
Chairwoman Waters. Thank you. The gentleman from Wisconsin,
Mr. Steil, is now recognized for 5 minutes.
Mr. Steil. Secretary Fudge, thank you for being here with
us today. I think it is important to note that one thing was
left off in our most recent conversation, and that is that the
CDC's moratorium on evictions has been found to be
unconstitutional by two courts. So we are heading down the
railroad tracks here, and the bridge is out. And my concern is
that by saying that HUD has done its job but the States have
been slow, that is not a lot of solace to an individual in
Racine, Wisconsin, in my district, or in a city across the
United States who finds themselves out of their home because
the funds haven't made it all the way from HUD through the
States to that individual or to their respective landlord.
And one of my real concerns is that the Biden
Administration has rewritten the guidance and the rules on this
4 times. They rewrote it in February, they rewrote it in March,
they rewrote it in May, and they rewrote it in June. And so, I
have real concerns that we are heading down this railroad track
with the bridge out, the moratorium has been ruled
unconstitutional. And although HUD has, as you, I think,
correctly noted, made those funds available to the States, the
States haven't acted. I would note that the rewriting of that
guidance by the Biden Administration gives me great pause for
concern.
But let me shift gears and dive into an issue that I have
great concern with, which is the impact of rising costs on
American families. It is hard to ignore the fact that prices
have continued to increase, and they are increasing at a rate
faster than we have really seen since 2008. I think we know why
this is happening. Washington has dramatically increased
spending, and the Fed continues to push an aggressive monetary
policy. And as a result of these misguided government schemes,
like paying people not to work, supply chain and labor force
problems are taking even longer to resolve.
And as I discussed with Fed Chairman Powell last week, this
might lead to a reset of our inflation expectations, creating a
self-fulfilling prophecy driving higher inflation, which means
more uncertainty and higher prices for American families. And
these price increases flow directly into housing costs. Rising
material costs have added $36,000 to the price of a new home.
Nationwide, home prices are up 14 percent in the past year. And
it is not just economists they are talking about. The American
public is feeling it. I talk to people on a regular basis who
stop me in the grocery store and talk to me about the impact of
the rising cost of groceries, but also the rising costs for
them to live their lives.
And so, as I read your testimony today, the word,
``climate,'' appears in your testimony 5 times, ``equity''
appears twice, but I find it a little bit interesting as I read
that you failed to mention the word, ``inflation'' once out of
1,300 words in your written opening statement. And I worry
about this Administration's misplaced priorities, which I think
are out of step with American families.
To be direct for a question here, have you or HUD done
analysis on the impact of rising costs on working-class
Americans and their ability to purchase a home?
Secretary Fudge. Let me first say that every reputable
economist in this country has said that inflation will be
temporary only, and that it is not something to be concerned
about. And secondly, let me say that two courts have found the
CDC's moratorium unconstitutional, but two have found it
constitutional, and the Supreme Court of the United States let
it proceed.
Now as it relates to the cost, yes, we are looking at the
cost. That is what we do.
Mr. Steil. What is that showing? As costs have gone up--for
a new home, it has increased $36,000. What have your studies
said about that?
Secretary Fudge. The Home Builders told me it was going up
because of the cost of goods and services. I believe them.
Mr. Steil. Let me then shift gears into how the policies of
demand-side subsidies, I think, will also increase prices. I
think one is the Biden Administration's policies and the
aggressive spending we are seeing in D.C. is increasing the
prices. It is showing up--the economists that you are speaking
with--it is making homes more difficult and more out of reach
for the average American.
But also, as we look at the policies being put in place,
increasing demand-side prices--you mentioned in your testimony
your support for more vouchers and other subsidies to challenge
renters. I know Chairwoman Waters has also proposed expanding
the voucher program to make it an entitlement. And I am
concerned that broad demand side subsidies fail to address one
of the underlying problems in our housing market, which could
be the fact of a lack of supply. And it seems like we should be
working to encourage developers to build more homes.
What is, in your opinion, is getting in the way of
increasing the supply?
Secretary Fudge. There are so many it would take me an hour
to have that conversation with you. And I think, sir, just to
be honest, that your assessment is really very unfair. You know
that there are many issues as to the cost of housing as well.
Chairwoman Waters. The gentleman's time has expired. The
gentleman from Illinois, Mr. Casten, is now recognized for 5
minutes.
Mr. Casten. Thank you, Madam Chairwoman. Secretary Fudge,
so nice to see you here. Congratulations. We are fortunate to
have you at the helm of HUD.
This won't surprise you: I would like to talk about climate
change, and specifically that the 2022 budget proposes $800
million for targeted investments in energy efficiency and
resiliency in the housing sector. And this is through the Biden
whole-of-government approach to climate. And I am so excited to
finally have a White House that is taking a whole-of-government
approach. It is maddening to me that we subsidize energy
extraction in this country and we also subsidize energy
conservation. It is amazing that we get anything done when we
are driving in the same direction.
My first question, and this could be very long but I want
to get to two more questions, so if you could just--I am just
curious if you are satisfied that within the silos within HUD,
you are coordinating and rowing in the same direction, and
across the other various government agencies? Because we have
never really had a whole-of-government approach to climate
change before. And are you satisfied that you have the tools
you need to coordinate and make sure that we are rowing in the
same direction? Is there anything we can do to help, if not?
Secretary Fudge. We just hired one person whose sole
responsibility is climate and working across agencies. So, I am
feeling good about the fact that we recognize that we have
elevated it and are giving that person the staff that they
need, to make sure that we can do this right.
Mr. Casten. Terrific. Well, let us know if we can help.
Second question. When I was with the President when he was
out in Illinois 2 weeks ago, we had a brief conversation about
the fact that there is that which is necessary, scientifically,
for us to leave a better planet to our children than the one we
inherited, and there is that which is politically possible. And
over the course of my lifetime and my brief tenure in this job,
I think we have twisted our arm an awful lot congratulating
ourselves for doing what is politically possible. And if you
are comfortable answering the question, I am curious whether
$800 million of investment in our housing stock for resiliency
and efficiency meets all of your needs, or is that just the
limit of what is possible?
Secretary Fudge. It certainly doesn't meet all of the
needs. I don't think that any of us believe that it does. But
what we do know is that it is a great place to begin. It is
more than we have ever put in it. It is more than we have ever
done as a nation, especially when we have Members of this
Congress who don't even believe in climate change.
So we are doing the very best we can to really make a mark,
and to set the example for what we can do if we put the kind of
resources in it that it really needs.
Mr. Casten. Okay. My last question ties into a number of
issues. My colleagues have heard me say before that the CFTC,
in the Trump White House, issued this report managing climate
change in the financial sector, which pointed out, among other
things, that there is a huge concentration of exposure in the
collateralized mortgage-backed securities market. I think it is
something like 25 percent of all of that portfolio is in
Houston, New York, and Miami, that are exposed to massive
losses, and how should we be thinking about that.
Now, that is obviously a bit outside of your agency, but as
the frequency of these natural disasters increases, the CDBG
Disaster Recovery Program has become an increasingly important
portion. In 2017, natural disasters caused $306 billion, with a
``B,'' in damages in the United States. But as I don't need to
tell you, that program has never been authorized. So you have
to come back for a Federal Register notice for each one-off
appropriation.
How would permanent authorization of that program better
help you do your job and better help communities recover after
a disaster?
Secretary Fudge. It would help significantly. It would
allow us to move quicker. It would allow us to assess faster.
Because right now, we do have to come back for authorization.
It would be tremendous.
Mr. Casten. Thank you. I have no further questions. I
appreciate your time, and I yield back.
Chairwoman Waters. Thank you. The gentleman from Texas, Mr.
Gooden, is now recognized for 5 minutes.
Mr. Gooden. Thank you, Madam Chairwoman, and welcome, Madam
Secretary.
An overwhelming amount of HUD funding to address
homelessness goes to continuum of care boards, and those boards
are responsible, as you know, for providing a holistic approach
to end homelessness, including housing, soup kitchens, mental
health, job placement, et cetera.
It is my belief, based on conversations I have had with
some in my local area, that many of them--not all, but many--
operate as homeless cartels, if you will, with little
oversight. The White House and HUD requested roughly $3.12
billion for continuum of care programs next fiscal year, and as
an example of what I just stated, recently a grand jury in
Fresno, California, criticized the COC model because it lacks
transparency and is rife with conflicts of interest.
Additionally, a report from the California State Auditor
confirmed the lack of oversight and effectiveness of continuum
of care boards. The grand jury also mentioned the same people
who control these board funding allocations are the same people
in charge of the organizations receiving the funding.
Do you feel, Madam Secretary, that there are adequate
measures in place to provide effective oversight of these
boards and prevent waste, fraud, and abuse?
Secretary Fudge. I do, but I also do believe, as well, that
we could do better.
Mr. Gooden. Does HUD have any plans to improve these? Is
there a plan of action in place? I would also ask, would you
agree that allocating funding by some of these board members
who may also sit on the boards of a nonprofit could be a
conflict of interest?
Secretary Fudge. If there are conflicts of interests, of
course it would not be appropriate.
Mr. Gooden. Wonderful. Would you commit to perhaps working
with my staff on this?
Secretary Fudge. Absolutely. I would be happy to do it.
Mr. Gooden. That would be great, and I appreciate that.
Moving on, one I constantly hear from local leaders in the
rural parts of my district is they often feel left out or
forgotten when working with Federal agents to address housing
issues, and by some estimates, writing a single Federal grant
application takes a nonprofit an average of between 80 and 200
hours, and many jurisdictions do not have the staff or
resources to even apply, let alone compete. Would you care to
comment, or would you comment specifically on plans that your
organization may have to reduce that burden and make it easier
for small, rural localities, like those in my district, to
receive grants?
Secretary Fudge. That is a major problem. That is also one
of the reasons we don't have the emergency rental money out as
fast either, because smaller communities don't even know how to
get it. They don't have the capacity, once they receive it, to
figure out how to quickly move it through the system.
So we are working with rural and small communities,
particularly through technical assistance. I even met yesterday
with the League of Cities. We are doing all we can to be sure
that we get to those communities, because they get left out. I
agree with you, 100 percent.
Mr. Gooden. Thank you. And before I close, I would like to
congratulate you and welcome you. My friend, Congresswoman
Jahana Hayes, was sitting behind you, supporting you, so I
think you are missed by many of your colleagues. Welcome. Thank
you.
Secretary Fudge. Thank you.
Mr. Gooden. I yield back.
Chairwoman Waters. Thank you. The gentleman from New York,
Mr. Torres, is now recognized for 5 minutes.
Mr. Torres. Thank you, Madam Chairwoman. And it is always a
pleasure to see you, Madam Secretary. I hope that your nephew,
who cares as deeply about the New York City Housing Authority
(NYCHA) as I do, is doing well.
As you know, the state of public housing has been plagued
by decades of disinvestment at the hands of the Federal
Government. I would characterize the state of public housing in
New York City as demolition by neglect. And the fate of the New
York City Housing Authority, the fate of America's largest
public housing stock in America's largest city will depend on
what we do collectively in the upcoming reconciliation bill.
NYCHA needs enough funding not only to address a capital
need of $40 billion, and counting, but also to transition to
clean energy building systems.
A central figure in the future of NYCHA is the HUD Regional
Administrator, a position that remains vacant. What is the
timeline for appointing a new HUD Regional Administrator
specifically for Region 2?
Secretary Fudge. I know that it is in the process that is
done by the White House Personnel Office, but I don't know the
timeframe.
Mr. Torres. Fair enough. On January 1, 2022, a new mayor of
New York City will assume office. The mayor historically has
been in charge of the New York City Housing Authority, by
virtue of appointing both the CEO and the COO, the chair and
the general manager. But as you might know, the relationship
between the mayor and the Housing Authority was fundamentally
altered by the administrative agreement among HUD, the U.S.
Attorney for the Southern District, and the City of New York.
Given the certainty of a new mayor in January of 2022, does
HUD have any plans to restore mayoral control of the New York
City Housing Authority?
Secretary Fudge. I would really need to look into it. I do
know that there is Federal oversight. I do know, as well, in my
conversations with the Tenants Association there that they have
some concerns as well that we need to take into consideration.
I don't have a problem with it personally, but I need to know
if we can do it legally.
Mr. Torres. Fair enough. The President has proposed over
$200 billion for affordable housing. When the subject of
affordable housing is brought up, the question that often comes
to mind is affordable for whom? And a concern that I have
expressed is that if we expand housing supply without expanding
housing subsidy then we run the risk of creating housing that
is unaffordable to the lowest-income Americans. In my view, the
best path to affordability for all Americans is the Ending
Homelessness Act, which would universalize Section 8 vouchers.
Of the $200 billion that the President has proposed for
affordable housing, how much do you envision going towards
Section 8?
Secretary Fudge. None of that, but there are set-asides,
and he is requesting 200,000 vouchers, in addition to the $200
billion for new housing.
Mr. Torres. So, that is in addition?
Secretary Fudge. Correct.
Mr. Torres. The Fair Housing Act--we often speak about
systemic racism, and I would argue nowhere is systemic racism
more manifest than in the area of housing, segregated housing,
segregated schools. Do you think that exclusionary zoning laws
are arguably a violation of the Fair Housing Act?
Secretary Fudge. I am not sure, but I would suggest this:
It is a violation of everything we stand for.
Mr. Torres. The Administration recommends grants incentives
for States to adopt land use reforms. Are you concerned that
incentives can only take us so far, and that there might need
to be enforcement of the Fair Housing Act?
Secretary Fudge. I would say, as a former mayor, I know how
touchy that subject is with local communities, because they
don't believe that the Federal Government should come and tell
them how they should zone. But I really do believe, Mr. Torres,
that it is a problem, and we have to address it. And I am going
to look at it from the law, and see if there is something that
we could do with Fair Housing. I think that it is a good way to
approach it. We will take a look.
Mr. Torres. No, I know that there is resistance, but keep
in mind that historically, there has been resistance to Federal
intervention when it comes to voting rights. States and
localities would prefer to enact voting laws without any
accountability to the Federal Government. But the reason for a
Federal role is to crack down on the complicity of States and
localities in systemic racism. So, I hope that is something you
would explore in greater detail.
Secretary Fudge. We are looking at systemic racism all
throughout HUD. Historically, systemic racism is in every
single agency of the Federal Government, and we are no
different. So, we are trying to address it.
Mr. Torres. And obviously, public housing has been
chronically underfunded. Have you thought about how to bring
greater accountability to the operation and management of
public housing? Is that a subject you have thought about?
Secretary Fudge. Well, I have given it great thought,
because of what I have found in my own travels, in talking with
tenants, and I talk to tenants every place I go. So absolutely,
I have given it a lot of thought.
Mr. Torres. And what are your thoughts on the New York City
Housing Authority?
Secretary Fudge. Well, one thing that I think that we have
to do is to be honest, to be transparent, and to do our part.
We can't change it all, but certainly there are some things we
can change, and we should.
Mr. Torres. I see my time is about to expire, but it's
always a pleasure.
Secretary Fudge. My pleasure, indeed.
Chairwoman Waters. Thank you very much. The gentleman from
Florida, Mr. Lawson, is now recognized for 5 minutes.
Mr. Lawson. Thank you, Madam Chairwoman. And Madam
Secretary, welcome to the committee. It certainly is a pleasure
to see you. I want to thank you, first of all, for the
immediate action that you were able to take on some of the
housing problems that I have in my district.
My question will probably come at the end, but what I want
to say is that during my tenure as a coach at Florida State
University, I spent a lot of time--because that is where the
athletes were located--in New York, in Chicago, in Ohio, in
Atlanta, and in many of those areas where they came out of
major housing complexes. And there have been very little
changes in some of the things that I noticed then.
I am more concerned about--and I know that we face a
housing shortage here, but I am more concerned about the safety
and the problems that I have been experiencing with some of the
management companies. And those management companies, I know,
are getting Federal dollars to keep up the upkeep and
everything else.
Could you elaborate on what condition--because I did with
the last HUD Secretary and nothing much happened--what is a way
that we can improve the relationship with management companies
so they help keep up the properties, as so many, especially
women, have to depend on with a kid, to be in very safe
conditions?
Secretary Fudge. Let me just say, first off, it is nice to
see you, Mr. Lawson. That is our responsibility. We have 64
offices across this country. We have a staff of about 7,000
people, not nearly enough to do the work we do, but a big
enough staff to do the work that we should do. We have to do
our part. We have to make sure that our inspectors are doing
their jobs, that our local people are doing their jobs, and we
are doing our jobs.
And we also have to hold these management companies and
landlords accountable, and let them know that we are not
playing about this. We are going to make them keep up their end
of the bargain, and we are going to keep up ours. It is all
about leadership, and it is all about demanding that we do the
work that the people are paying us to do, that we do the work
that we have been charged to do by this Congress.
Mr. Lawson. That is very good to hear. And I know this
might have been addressed earlier, but I guess the key question
in my last 2 minutes is, and I know you have elaborated on it
some, what can we do in Congress? I have heard a lot of the
other Members say that we need this, or we need that. And I
know you are more familiar with what has happened in Congress
over the years. But what can we do now, in Congress, to
alleviate a lot of problems that would help you all do your
jobs better?
Secretary Fudge. I didn't hear the last part, Mr. Lawson.
Mr. Lawson. To help you all, what can we do in Congress--
Secretary Fudge. Oh, what can you do to help us? One thing
is, of course, to give us the flexibility to do our jobs. I
think it is important for people to understand, they don't like
the word, ``flexibility,'' but if you allow us to do the work
we know needs to be done--we talk about regulations and
restrictions, but some of those are on us too. So, we need the
flexibility to do the work that we know that we should do. That
is what we need you to do, is just be supportive.
The other thing, I think, the biggest thing to do is to
fund us properly. At one point, HUD made up 7 percent of the
entire discretional Federal budget. Today, it is less than 1
percent, and the problem is just as great.
Mr. Lawson. I think one of the things that happened, before
my time runs out, that I noticed in the 4\1/2\ years that I
have been in Congress, is that these issues come up about HUD,
and there has been a reluctance to provide the resources it
really needs. But when Members, myself and everybody, go back
to their districts, they see the hardships. But at the same
time, they don't realize that a lot of that has to do with what
we do here, and why we are in Congress.
And with that, Madam Chairwoman, I yield back.
Chairwoman Waters. Thank you very much, Mr. Lawson.
I would like to now thank our distinguished witness,
Secretary Fudge, for her testimony today.
The Chair notes that some Members may have additional
questions for this witness, which they may wish to submit in
writing. Without objection, the hearing record will remain open
for 5 legislative days for Members to submit written questions
to this witness and to place her responses in the record. Also,
without objection, Members will have 5 legislative days to
submit extraneous materials to the Chair for inclusion in the
record.
And with that, I want to thank you so very much again,
Secretary Fudge, and the hearing is now adjourned. Thank you.
[Whereupon, at 1:19 p.m., the hearing was adjourned.]
A P P E N D I X
July 20, 2021
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