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Congress pushes to deregulate public housing authorities across the nation

June 11, 2012

by Lynda Carson

Oakland – With corruption running rampant on Wall Street and in the nation’s lending institutions and housing industry, millions of homeowners are facing foreclosure as a direct result. Matters are only getting worse as members of Congress and the Department of Housing and Urban Development (HUD) are pushing to deregulate the nation’s more than 3,000 public housing authorities (PHAs) and are insisting that more PHAs should be able to convert to what are called Moving To Work (MTW) demonstration housing authorities.

The current campaign to demolish or privatize public housing nationwide, most dramatically demonstrated when New Orleans destroyed 4,500 perfectly livable, unflooded apartments after Katrina, is motivated by the fear of large concentrations of poor people and the power they can wield when they vote as a bloc and demand self-determination. – Photo: Survivors Village
Authorized by Congress in 1996, the Moving To Work (MTW) demonstration program was created for a limited number of PHAs to try out new and different ways to save money and find cheaper methods to deliver housing services. However, MTWs have morphed into agencies that are becoming notorious for abusing the funding from Congress – funding that was meant to assist the poor.

Meanwhile, HUD is under fire from an April 19, 2012, report that was released on May 21 by the Government Accounting Office (GAO). It ridicules any assertions by HUD that an MTW’s activities can be evaluated properly.

The GAO is an investigative arm of Congress with the power to examine matters related to the receipt and use of funding by Congress, and the GAO believes that MTWs are not regulated enough to properly evaluate how they are operating.

As was reported by the National Low-Income Housing Coalition (NLIHC), during a March 29 oversight hearing on HUD and Department of Transportation programs in Washington, D.C., HUD Inspector General David Montoya publicly criticized the public housing authority of Philadelphia as an example of the corruption of MTWs.

IG Montoya stated that the PHA in Philadelphia is an MTW demonstration program that was legally allowed to use $1.1 million of its funding to fight against the oversight of the IG’s office and was allowed to use money to hire outside legal counsel to shadow IG staff who were auditing the housing authority, when it could have used the money on housing instead.

The PHA in Philadelphia is an MTW demonstration program that was legally allowed to use $1.1 million of its funding to fight against the oversight of the IG’s office and was allowed to use money to hire outside legal counsel to shadow IG staff who were auditing the housing authority, when it could have used the money on housing instead.

Since it was legal for that MTW to operate in such a way, apparently all other MTWs are allowed to abuse funds that were meant to be used for housing needs to fight against audits by the HUD Inspector General’s Office.

At the same hearing, IG Montoya also stated that removing the MTW status from the PHA in Philadelphia would be a first good step to resolve the problems the IG is aware of at that housing authority since 2004, according to a March 30, release by the NLIHC.

According to the GAO report, the information available from HUD about MTWs varies, and HUD has declined to specify in its rules and regulations that the performance information from an MTW must be quantifiable and outcome oriented. The lack of rules and regulations has corrupted and hampered efforts to determine if MTWs are functioning properly and places hundreds of millions of dollars in federal funding at risk of misuse and abuse.

HUD has not established a process to assess compliance with statutory requirements for MTWs, and the report further states that HUD lacks the assurance needed to determine that an MTW is complying with the statute that governs them.

Additionally, “HUD has not identified the performance data that would be needed to assess the results of similar MTW activities or the program as a whole and has not established performance indicators for the program,” according to the GAO.

The MTW program is wide open to abuse and, according to the recent GAO report, “HUD has not done an annual assessment of program risks despite its own requirement to do so and has not developed risk-based monitoring procedures.”

Additionally, the GAO report reveals that HUD cannot verify the accuracy of information being self-reported by MTWs to HUD and that HUD does not have any policies or procedures active to verify what is actually going on in an MTW housing authority.

Despite the corruption of the existing MTW demonstration programs, members of Congress and HUD want to allow for the creation of more MTWs across the nation in the latest housing reform bill working its way through the system.

As is, 75 percent of all Section 8 housing assistance vouchers are required to go to poor people whose income is equal to or less than 30 percent of the area median income but, under an MTW demonstration program, those rules may not apply any longer.

As is, 75 percent of all Section 8 housing assistance vouchers are required to go to poor people whose income is equal to or less than 30 percent of the area median income but, under an MTW demonstration program, those rules may not apply any longer.

The current 35 existing MTW demonstration housing authorities are essentially free of the normal rules and regulations that most housing authorities have to abide by, and MTWs are allowed to ignore income targeting regulations meant to serve the poor that are required in over 3,000 other non-MTW housing authorities.

Low-income tenants and housing advocates across the nation continue to speak out against the MTW program. MTWs can impose time limits and work requirements that are designed to force the poor out of the nation’s subsidized housing programs, can set rents without regard to household incomes, and can merge the funding from the public housing program with the Section 8 voucher program, turning it all into one big slush fund.

According to the NLIHC, members of Congress are currently working on a huge housing reform bill called the Affordable Housing and Self-Sufficiency Improvement Act (AHSSIA), formerly called SEVRA (Section 8 Voucher Reform Act) and SESA (the Section 8 Savings Act). AHSSIA has been stalled over efforts to expand the MTW demonstration program.

The latest details of the bill released on April 13 have broad support even though they reveal that it is designed to have a significant negative impact upon the poor, elderly and disabled. It is another example of class warfare against the poor.

The latest details of the bill released on April 13 have broad support even though they reveal that it is designed to have a significant negative impact upon the poor, elderly and disabled. It is another example of class warfare against the poor.

Efforts to move the bill forward continue, and even though the NLIHC has opposed the proliferation of MTWs in the past, it may be open to making a limited deal with lawmakers that would allow more MTWs.

HUD is not fully embracing the GAO’s eight recommendations on how to operate the MTW program and has disagreed with the GAO’s major recommendation to create overall performance indicators for all of its MTWs. Despite the GAO’s belief that performance indicators are critical to demonstrating program results in the MTWs, HUD continues to resist changes to its policies.

In addition to allowing for the expansion of MTWs, Congress may soon pass legislation that raises the rent on the poorest of the poor and allows for a number of PHAs to test time limits, rent reform and work requirements for poor people in the nation’s federal housing programs.

Lynda Carson may be reached at tenantsrule@yahoo.com.

 

2 thoughts on “Congress pushes to deregulate public housing authorities across the nation

  1. SuzieQue

    Perfect example of sensational journalism – and it's a stretch to call this journalism. The picture – and New Orleans for that matter – have nothing to do with the substance of the article. But if you are going to use a picture and profit off the drama that unfolded as a result of Hurricane Katrina, PLEASE do some fact checking before making inflammatory statements such as "4,500 perfectly livable, unflooded apartments . . ." You would not let your nuisance neighborhood cat reside in the apartments that were demolished. ALL 4 of the Housing complexes had significant flood water (St. Bernard, B.W. Cooper, C.J. Peete, and Lafitte). All 4 were located in neighborhoods that had significant flooding and all residents alike experienced being displaced for some period of time. Just as you would experience in rental property, the "owner" of the apartment buildings needed to demolish the majority of the units in order to build bigger and better.
    Please stop using our devastation as your tagline.

    Reply
  2. article

    Heya i’m for the first time here. I came across this board and I find It truly useful & it helped me out a lot. I hope to give something back and help others like you helped me.

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