1. IN Statewide Conference on Housing & Community Economic Development / Midwest Summit September 20, 2011 Linda Couch Senior Vice President for Policy www.nlihc.org

2. Last week’s Census numbers 46.2 million people in poverty, 2.6 more million than in 2009 The largest number in the 52 years for which poverty estimates have been published One in six are poor in the United States One in three young families with children

3. The Gini Index Measure of income inequality Ranges from 0, when everyone earns the same To 1, when all income goes only to one person In 2009, U.S. Gini index was 0.468, a 20% rise in income disparity over last 40 years Similar to Gini indexes of the Philippines and Mexico

4. HUD’s Largest Programs Vouchers Public Housing Project-Based Section 8

5. Housing Choice Vouchers 2 million vouchers in use today Loss of 150,000 (2005 – 07) Many improvements in the offing House subcommittee would cut more than 40,000 voucher households from program in FY12

6. Housing Choice Vouchers Section 8 Voucher Reform Act / SESA – Rent-setting and income reviews – Inspections – Enhanced vouchers – Project-basing vouchers – Other objectives? Time limits, Moving to Work?

7. Public Housing 1.1 million units, $26 billion rehabilitation backlog Loss of 150,000 over last 15 years, >10K a year Choice Neighborhoods Initiative: Continue to redevelop housing, but also focus on entire neighborhood

8. Public Housing HUD’s Rental Assistance Demonstration Authorize greater access to private capital – Allow conversion of PH units to project-based contracts – Choice option – Long term, renewing contracts and use restrictions House subcommittee $$: 16% cut to operating; 25% cut to capital

9. Project-Based Section 8 1.4 million units Loss of more than 300,000 units late 1990s, pace of loss has slowed Contracts with owners backed by FHA insurance, Congress reticent to underfund but threats loom as all is on the table

10. These three programs are critical: They are affordable to each household – bringing stability to households and communities They are deeply income targeted – Why income targeting matters:

11. If you lined up…

12. The Gap

13. Severe Housing Cost Burdens Of all renter households paying more than 50% of their income on housing 78% have incomes below 30% of area median in IN 79% have incomes below 30% AMI in OH 76% have incomes below 30% AMI in IL 75% have incomes below 30% AMI in KY 73% have incomes below 30% AMI in MI

14. “Vacancies,” “Glut of Empty Homes” Incomes of extremely low income households are extremely low! Median U.S. household income is $60,000 Median HUD household income is $10,200 Just 32 affordable and available homes for every 100 extremely low income renter households

15. CDBG and HOME House subcommittee did not cut CDBG funding but would cut CDBG admin fees from 20% to 10% House subcommittee would cut HOME program in FY12 by 25% Cuts expected in Senate as well

16. Super Committee Budget Control Act set up requirements for massive spending cuts over next decade Sets 10 years of spending caps for discretionary spending Anything short of $1.2 trillion in cuts enacted by 12/31/11 would be metered out in across the board cuts beginning in January 2013

17. Tax Reform and Deficit Reduction– what will be addressed? Low income housing tax credits $5 billion a year Reforms Keep out of tax reform/deficit reduction discussion Mortgage interest deduction reform $100 billion a year Top 10% of tax payers get 30% of benefit (top 32% get 72%) On the table in deficit reduction talks as well as how and whether gov’t should be supporting homeownership

18. Housing Finance Reform U.S. take over of Fannie Mae and Freddie Mac White House sees more limited role for feds in future mortgage market Agree w/White House that fed gov’t has duty to low income households ELI rental market is one that history (and current data) tell us private developers will leave behind MF rental is ripe for public investment

19. HUD is busy, too Happy to avoid Congress if possible Small area Fair Market Rent (FMR) demonstration Implement HEARTH Act, consolidating three McKinney- Vento homeless assistance programs Amend HOME rule Streamline portability process Allow new cross-jurisdictional consortia to administer vouchers Improve Section 3 education and oversight Improve and simplify Consolidated Plan process PHA accountability and transparency: salaries, red flags

20. Opportunities Sane person finds the bright side GSE reform Some common sense reforms generate savings and could be implemented Administration and many in Congress are committed to balanced housing policy

21. Balanced Housing Policy As more of us become renters Balanced as to favoring one form of tenure over another Balanced as to resources devoted to programs

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