PA Delegation Urges HUD to Include PA Public Housing Authorities in Competition for $1 billion in Stimulus Funds
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PA Delegation Urges HUD to Include PA Public Housing Authorities in Competition for $1 billion in Stimulus Funds

Washington, D.C. – May 21, 2009 – (RealEstateRama) — Today, 16 members from the Pennsylvania delegation sent a letter to Shaun Donovan, Secretary of the U.S. Department of Housing and Urban Development (HUD) urging him to reconsider selection criteria for the $1 billion in Public Housing Capital Funds included in the Economic Stimulus, also known as the American Recovery and Reinvestment Act (ARRA).

Based on current HUD requirements, only 35 of the 82 public housing authorities in Pennsylvania will be eligible to compete for the $1 billion available in the initial round of funding. The selection criteria was made public in a Notice of Funding Availability (NOFA) on May 7, 2009.

“We ask that your Department consider amending the NOFA to better ensure that Pennsylvania’s public housing authorities have maximum opportunity to compete for these needed funds,” the members wrote. “We are deeply concerned that many of the neediest Pennsylvanians will be denied housing, services, and jobs as a result of the NOFA guidance.”

The letter suggests several changes HUD could make to ensure that housing authorities in Pennsylvania can compete for funds on an equal footing with other agencies, including: waiving reporting requirements so that successful “Moving to Work” programs are eligible, opening the competition to communities where concentrations of poverty exceed 20%, and waiving the “high performer” status as a requirement for funding.

“As we are sure you know, Pennsylvania was hard hit by the recent economic downturn. Now more than ever, Pennsylvanians need equal access to the ARRA capital funds to ensure a ready supply of quality affordable housing and the jobs created by use of those funds,” the Members concluded. “We can assure you that the public housing agencies in Pennsylvania stand ready to spend ARRA funds quickly and effectively to meet these goals.”

Pennsylvania Delegation members signing the letter are: Senators Arlen Specter and Bob Casey, Representatives Bob Brady, Chaka Fattah, Jason Altmire, Bill Shuster, Tim Holden, Chris Carney, Tim Murphy, Kathy Dahlkemper, Mike Doyle, Glenn Thompson, Allyson Schwartz, Todd Platts, Charlie Dent, and Jim Gerlach.

Full text of the letter follows:

The Honorable Shaun Donovan
Secretary, U.S. Department of Housing and Urban Development
Washington, D.C.
Dear Secretary Donovan:

It has come to our attention that a number of public housing authorities in Pennsylvania will not have equal access to funds appropriated under the American Recovery and Reinvestment Act of 2009 (“ARRA”). We seek your assistance to resolve concerns expressed by a number of these housing authorities regarding the ARRA Notice of Funding Availability for Capital Fund Recovery Competition Grants (“NOFA”) issued by the U.S. Department of Housing and Urban Development (“HUD”) on May 7, 2009. We are told that currently only 35 of the 82 public housing authorities in Pennsylvania will be eligible to compete for the $1 billion available in the first funding round under this NOFA. We ask that your Department consider amending the NOFA to better ensure that Pennsylvania’s public housing authorities have maximum opportunity to compete for these needed funds. We are deeply concerned that many of the neediest Pennsylvanians will be denied housing, services, and jobs as a result of the NOFA guidance.

We received a letter, a copy of which is attached, signed by sixteen housing authorities within the Commonwealth of Pennsylvania, explaining why the selection criteria for this funding seems to disadvantage Pennsylvania housing authorities. All of these agencies should be granted an opportunity to demonstrate that they are able to expend funds within the ARRA-mandated deadlines. These agencies have asked that HUD consider the following changes to the NOFA that will better ensure that housing authorities in Pennsylvania can compete for funds:

MTW Agencies. The housing authorities in both Philadelphia and Pittsburgh are Moving to Work (“MTW”) agencies. As currently drafted, the NOFA excludes a number of MTW agencies from the first round of funding, including the Philadelphia Housing Authority (“PHA”), because it does not use HUD’s standard reporting systems per its agreement with the Department. We understand that successful MTW agencies in cities such as Chicago, Baltimore, Washington, D.C. and New Haven are similarly excluded from the first round of competition. The extraordinary success that PHA has had in revitalizing distressed neighborhoods in Philadelphia was due, in large part, to the agency’s participation in the MTW program. Under MTW, the PHA has spent hundreds of millions of dollars on public housing properties and put thousands of Philadelphians to work. We ask that you consider modifying the NOFA to include PHA and the other MTW sites in the first round funding competition.

Expenditure Rates. We understand that nearly all of the public housing agencies in Pennsylvania are currently spending funds in accordance with HUD’s legal requirements. It appears that the criteria in the NOFA exclude some agencies with successful spending histories from the first and second rounds of competition. These agencies ask that the NOFA language be modified to allow those that comply with the HUD legal requirements to compete for funds if they demonstrate that they can spend the ARRA funds in the timeframes provided by the ARRA statute.

High Performer Status. We believe that agencies that receive ARRA funds should have a demonstrated track record for spending public money quickly and effectively. We understand that the group of agencies designated by HUD as “high performers” does not include all of the agencies that have demonstrated their ability to use federal funds wisely. Our public housing agencies ask that agencies that do not have a “high performer” designation be allowed to submit applications in the first round if they can demonstrate a history of using federal funds efficiently and effectively. Historically, the high performer status measure has not been used to exclude housing authorities from even applying for competitive grant funding. Furthermore, with respect to PHA, HUD acknowledges that the Public Housing Assessment System under which high performer status is used is not the measure under which PHA is evaluated. Under the MTW agreement, PHA is required to submit a detailed annual report. We certainly agree that high performer status may be considered in awarding funding under the competitive grant formula, but it should not be used to exclude housing authorities from competing.

Use of Census Tract Data. We understand that the NOFA includes a threshold requiring that projects seeking grants from the $100 million of the Public Housing Transformation fund must be in census tracts that have concentrations of poverty that do not exceed 20%. This threshold is particularly problematic for Pennsylvania, as distressed public housing that needs reinvestment is located in areas with high job losses. As you know, many of the public housing communities that need housing investment the most are in census tracts with much higher poverty levels. Many high poverty areas need additional investment to transform public housing communities, so they can attract a broader mix of incomes. Other high poverty census tracts are gentrifying communities where it is important to invest in the preservation of affordable housing resources to better ensure that people of all incomes can reside there. Unless the threshold is removed, virtually the entire City of Philadelphia and sections of the City of Pittsburgh will be ineligible for funds from this category, as will a number of smaller communities with high unemployment. These are the very communities that need this type of investment. Furthermore, even if census tract data were a valid measure, the census information is based on the 2000 census the information for which was collected in 1999. Neighborhood conditions have changed significantly in many areas in the intervening years.

When Congress made funds available under ARRA, it was our intent that the public housing capital funds be distributed to communities across the country that desperately needed quality affordable housing and the jobs generated by construction and modernization of the public housing stock. It appears, however, that HUD’s method for implementing the NOFA will limit the access that many communities will have to those funds, thereby thwarting the purpose of the legislation.

As we are sure you know, Pennsylvania was hard hit by the recent economic downturn. Now more than ever, Pennsylvanians need equal access to the ARRA capital funds to ensure a ready supply of quality affordable housing and the jobs created by use of those funds. We can assure you that the public housing agencies in Pennsylvania stand ready to spend ARRA funds quickly and effectively to meet these goals. For these reasons, we ask that HUD make needed modifications to the NOFA to ensure that Pennsylvania public housing authorities can compete for additional funds on equal footing with other agencies.

Thank you, in advance, for your attention to this situation.

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