As reported by the National Low Income Housing Coalition's Memo to Members
The House Committee on Financial Services held a hearing on June 19 on the preservation of affordable housing. Two panels of witnesses discussed the need to preserve affordable housing and policy options for strengthening federal preservation. The committee had circulated a draft bill before the hearing, and much of the testimony was directed at that draft.
Committee Chairman Barney Frank (D-MA opened the hearing by talking about the important role assisted housing plays in creating diverse, vibrant communities. He also noted that protecting this housing has been a focus of his for many years, and is, in fact, a bipartisan issue. An early proponent was Senator Edward Brooke (R-MA) who initiated one of the first pieces of preservation legislation in the late 1970s. Mr. Frank noted that Senator Brooke had wanted to be at the hearing but could not for health reasons. Instead, Senator Brooke sent a letter of support.
Representative Shelly Capito (R-WV) expressed concern for the tenants in assisted housing and their welfare when assisted properties are converted to market rate housing. Representative Al Green (D-TX) spoke in support of maintaining assisted units and one-for-one replacement. "Vouchers are not enough," he said. Both Representatives Stephen Lynch (D-MA) and Emanuel Cleaver (D-MI) spoke about growing up in assisted and public housing and the importance of those resources to families and communities.
The witnesses on the first panel were John Garvin, Deputy Assistant Secretary for Multi-Family Housing Programs at HUD, Shaun Donovan, Commissioner of New York City's Department of Housing Preservation and Development, and Clarence Snuggs, Deputy Secretary of the Maryland Department of Housing and Community Development.
The witnesses on panel two were Michael Bodaken of the National Housing Trust, Laura Burns from Signal Group/Eagle Point Properties, Amanda Seward of the Lincoln Place Tenants Association, Laverne Joseph from the Retirement Housing Foundation, Ricky Leung of the Cherry Street Tenant Association, J. Kenneth Pagano of the National Affordable Housing Management Association, and Brian Poulin of Evergreen Partners LLC, representing the National Leased Housing Association.
Mr. Garvin described the lack of protection for tenants when an assisted mortgage matures. In that case there is no statutory requirement for HUD to provide the tenants with enhanced vouchers, as is required when an owner prepays or opts out of an assisted mortgage. Mr. Donovan discussed the importance of assisted housing to New York City and the need to provide for the conversion of units assisted under the old Rental Assistance Payment (RAP) and Rent Supplements (Rent Supp) programs to Project-Based Section 8 assistance. Such conversions would enhance preservation efforts by securing a commitment to longer-term affordability in exchange for certain benefits to the owner, such as mark-to-market rents. Mr. Donovan also noted that the draft bill circulated by Mr. Frank includes H.R. 44, the Stabilizing Affordable Housing for the Future Act, introduced by Representative Nydia Velasquez (D-NY) (see Memo, 1/5), which would provide much-needed preservation tools including upfront grants for the rehabilitation of HUD multifamily properties.
Mr. Bodaken testified on behalf of the Preservation Working Group (PWG), a coalition of individuals and groups who support the preservation of affordable rental housing that is co-convened by the National Housing Trust and National Low Income Housing Coalition. His testimony included the recommendations of the PWG for legislative changes and comments on the draft bill. He outlined several actions Congress needs to take to support the preservation of assisted properties, including fully funding the Section 8 Project Based program, ensuring that tenants are fully protected in the case of expiring contracts or maturing mortgages, and providing appropriate incentives for owners to maintain affordable housing.
Ms. Seward and Mr. Leung provided tenant perspectives on preservation issues and the draft bill. Mr. Leung testified on behalf of the National Association of HUD Tenants (NAHT) and both he and Ms. Seward spoke strongly in favor of a right of first purchase for tenants. Such a right would allow a preservation-minded purchaser to have the first opportunity to purchase an assisted multifamily property when an owner indicates a desire to sell. This provision is included in the committee draft, and Mr. Frank questioned the opposition of the owner groups to such a provision. "If you don't lose a nickel, what's the problem?" he asked.
Based on the testimony and other comments on the draft bill, the bill is expected to be revised and introduced sometime after the July 4th recess. Mr. Frank recognized that it is not likely that the House and Senate could complete work on the bill before the end of the Congress, but he did indicate that he would try to get the bill before the House later this summer.
The testimony can be found at www.house.gov/apps/list/hearing/financialsvcs_dem/hr061908.shtml
