National Low Income Housing Memo#42 12/19/97

H. C. Covington (
Sat, 27 Dec 1997 12:14:28 -0600

National Low Income Housing Coalition

NLIHC Weekly Housing Update
Vol. 2 No. 42
Memo to Members
December 19, 1997


by Helen Dunlap, President

In the continuing saga of housing and micro business, the staff from the
Portland HUD Field Office brought a letter from Tom Demery dated July 22,
1997 to my attention. While by no means a resolution to our concerns, the
letter is a start and remains in effect. It essentially says that tenants
may conduct incidental business such as typing, computer work, limited
babysitting, etc., in their units and receive incidental business income.
While recognizing that we need a broader vision to fit family day care,
etc., I wanted to pass this information along. If you need a copy of the
letter send me an e-mail (

Now to the topic of the day. As homeownership and the Partners in
Homeownership continues to be a principle focus of the affordable housing
community, it seemed appropriate to summarize several issues which are
critical to those of us who are perceived as a advocates for  households
with very low incomes. Each of these topics has been discussed at some
point this year in this column and I wanted to take a moment to summarize
and highlight them. Many often perceive that advocates of residents who
have very low incomes don't have a homeownership agenda. I think the
problems with the National Affordable Housing Coalition this past year
illustrated that we should and we do.

So what is important. First: retention. Many families with very low incomes
own their own home. While we add to the number of folks who are homeowners,
retention should be critical. At one point this past year I indicated that
there were a substantial number of FHA insured mortgages on homes where the
owner was on public assistance and potentially impacted by SSI and TANF
changes. I saw no planned effort by HUD to address this issue and hope it
is on the 1998 agenda. Secondly, counseling is available but many are
unaware. Getting the word out on how to find a counseling agency and how to
use them should be a critical facet of the advocates information effort.
The National Affordable Housing Coalition continues to attract families as
they travel across the US.

Thirdly, we need to work with our CDC's brethren, Fannie and Freddie and
FHA, lender and mortgage partners and local governments to grow the
interest and capacity for first time home buyers to do purchase
(acquisition) and rehabilitation. It strengthens neighborhoods, enables
diverse populations to stay in their neighborhoods and strengthens the
rental housing stock around it.  It is good for everyone and is currently
very tough to do.

Lastly, we need to work to grow resident homeownership opportunities -
whether it is for more flexibility in the use of Section 8 and tax credits
such as the work of the Anti Displacement Project in Springfield, Mass. ,
increased resident participation in the transfer of properties post
foreclosure or enforcement efforts, and increased training of residents in
sustaining participation in ownership such as the work of UHAB in New York.

The point of this discussion was to remind those who would divide and
classify those of us who work with very low income housing as only
interested in rental housing - this point of view does not reflect the
myriad of housing tools and challenges.

HUD Budget

Response to OMB Passback

HUD has issued its response to the Office of Management and Budget's (OMB)
passback to HUD's initial funding requests for FY99.  The Washington, D.C.
rumor wheel is maintaining that the numbers offered by HUD in response to
the passback are very near the final numbers for the President's FY99 HUD
budget.  What follows are snapshots of selected programs.  Some housing
programs, like those for elderly and disabled persons, were not mentioned
in the HUD response to the passback - apparently, HUD is not negotiating
these numbers further.

For public housing operating subsidies, HUD had originally requested FY99
funding of $3.84 billion, OMB passed back a recommendation of $2.818
billion and HUD's "post passback initiative" asks for $2.950 billion (FY98
enacted level was $2.9 billion).  For the public housing capital fund, HUD
originally suggested $3.2 billion and OMB passed back a recommendation of
$2.48 billion.  In the post passback initiative, HUD seeks $2.55 billion
(FY98 enacted level was $2.5 billion).  For HOPE VI and severely distressed
public housing, HUD asked for $550 million, OMB passed back the figure of
$477 million and HUD then responded with an ask of $550 million, restating
its commitment to approve 100,000 demolitions by the year 2000 (FY98
enacted level was $550 million).

For homeless assistance grants, HUD had requested $$1.5 billion, OMB had
passed back $1.004 billion and HUD then requested $1.15 billion, including
the same $181 million that was in the passback for 32,000 new Section 8
rental assistance vouchers.

For new Section 8 rental assistance vouchers, OMB had passed back to HUD
18,000 new vouchers at a cost of $100,000,000; in its recent response HUD
asks for more funding ($112.6 million) for the 18,000 new vouchers.  An
additional 50,000 vouchers, for a grand total of 100,000, will be requested
from the presidential priority initiative reserve.  There have been no new
vouchers (incrementals) since FY94.  All contracts will be renewed for one
year terms; the question is what per unit rent level the budget ultimately

For CDBG, HUD had originally requested $4.700 billion and OMB passed back
$4.675 million.  HUD's response to the passback was a request for $4.725
billion coupled with the separation of the formally included Youthbuild
(for which HUD is requesting $35 million).  The FY98 CDBG appropriation was
$4.675 billion.  For HOME, HUD had initially requested $1.6 billion and OMB
passed back $1.309 billion.  HUD's response to the passback was to ask for
$1.550 billion (FY98 enacted level was $1.500 billion).

For fair housing, HUD asks for $23 million for the fair housing assistance
program (OMB passback was $15 million, enacted FY98 was $15 million) and
for $29 million for the fair housing initiatives program (OMB passback was
$29 million and enacted FY98 was $15 million).

McKinney Act Reauthorized

On November 5, 1997, the House Banking and Financial Service Committee
approved H.R. 217, the Homeless Housing Programs Consolidation and
Flexibility Act.  This bill reauthorizes HUD's portion of the Stewart B.
McKinney Homeless Assistance Act.  Another portion of this Act, the
National Health Care for the Homeless Program, was reauthorized in 1996
through the Consolidated Health Centers Reauthorization Act.

In FY 1995, Federal homelessness assistance reached its highest level of
funding at $1.12 billion.  It has since declined to $823 million, even as
the incidence of homelessness increases. The debate concerning H.R. 217 in
the House Banking and Financial Services Committee reflected significant
disagreement regarding the appropriate level of funding.

The original version of H.R. 217 included a $1 billion yearly
authorization.  Committee Democrats offered an amendment pushing this
amount to $1.35 billion in FY 1999 and $1.5 billion in FY 2002.  Socialist
Committee member Bernie Sanders (I-VT)proposed a $1.6 billion level that
was countered by Jim Ryum (R-KS) who suggested $850 million.  The Sanders
amendment was defeated by a vote of 18-14 with the final authorization
level set at $1 billion.  Committee Chairman Jim Leach (R-IA) promised to
advocate with appropriators for spending at authorized levels in future

H.R. 217 replaces the existing SuperNofa process with two major funding
streams-Flexible Block Grants and a national competition for permanent
housing grants.

The Flexible Block Grants which accounts for 75% (70% in the second year)
of HUD's homeless assistance dollars would be distributed to States through
"entitlement communities", communities which currently receive Emergency
Shelter Grants(ESG) and "consortia" which are newly created collaborations
of small communities.  Initially, the ESG formula will be used for
distributing these funds, but the Secretary of HUD is required to create a
new allocation formula based on the incidence of homelessness and
contributing factors, subject to Congressional approval.  In the first
year, no more than 30% of these grants can go directly to States.

Flexible Block Grant funds can be spent for construction, acquisition, and
rehabilitation of emergency shelter facilities and housing, as well as for
preventative ans supportive services.  The caps on expenditures for
emergency shelter and supportive services, which had been included in H.R.
217 as originally drafted, were removed by the committee.  A 50%match using
non federal dollars is required; if in-kind services are used, a 100% match
is required.

The Permanent Housing Grants which account for 25% (30% in the second year)
of HUD's homelessness assistance dollars, are set aside to fund permanent
housing projects.  These grants would be distributed via a national
competition and could pay for construction, acquisition, rehabilitation,
operating costs, or rental subsidies.  Grantees are encouraged to target
this housing to people with special needs.

Advocates have raised the following concerns about these new funding
  some jurisdictions are likely to receive significant reductions in
funding when a new allocation formula is implemented, requiring the closing
of effective projects
  given the inadequate level of the authorization, local jurisdictions will
be forced to choose between existing projects or implementing new

The FY 1998 SuperNofa process foreshadows these contradictions.  A funding
announcement is imminent; the ability of local communities to impact upon
homelessness may change dramatically in response to these allocation
decisions.  You can obtain more information and an analysis of these issues
by visiting the National Coalition for the Homeless website (

One of the most controversial provisions of H.R. 217 concerns the desire of
r Congress to enhance cooperation among various Federal agencies which have
responsibility for homeless assistance programs.  The original version of
H.R. 217 granted the Secretary of HUD authority to impound homeless dollars
appropriated to other Federal agencies.  The National Health Care for the
Homeless Council vigorously opposes this provision.  While the argument
that HUD dollars ought to be spent for "bricks and mortar" and not for
services may have some merit, this is best addressed by funding mainstream
programs (such as public housing, Section 8, Supplemental Security Income
and Medicaid) adequately.

The National Health Care for the Homeless Council and the National
Coalition for the Homeless urge you to join them in advocating for rational
housing and homelessness programs.  The Senate will be considering
homelessness reauthorization in 1998 so now is a good time to contact our
Senator (202-224-3121) to offer your perspective on this issue.
HUD Announces National Homeless Info Line

HUD Secretary Andrew Cuomo recently announced the creation of a new
information line for people interested in becoming volunteers to help
homeless people in their communities.

The toll free National homeless Information Line (1-800-HUD-1010) provides
callers from all areas in the country with the names and phone numbers of
local homeless providers.  The providers then suggest ways that callers can

HUD will also distribute 300,000 "Take Ten" Tip Cards to callers and other
groups explaining how to help homeless people get housing, jobs, health
care and other services.  The wallet-size cards list 10 specific ways for
people to take ten minutes, hours, weeks or months to help the homeless.

Local HUD field offices will also distribute the cards to supermarkets,
bookstores and community center.  HUD encourages other groups to reproduce
and distribute the cards.

"Millions of American have walked by homeless people, wanting to help but
not knowing how," Secretary Cuomo said.  "HUD's Homeless Information Line
and our "Take Ten" Tip Card will give Americans a quick and easy way to get
information on how to help homeless people in their community."

Operators will answer calls from 8:00 am until 8:00 pm Eastern Time on
weekdays.  In the evenings and on weekends callers will get an automated
service that will give them toll-free local numbers in most major cities
and for all states.

HUD Planning Award

Department of Housing and Urban Development Secretary Andrew Cuomo, in
partnership with the American Planning Association (APA), announces the
first annual "HUD Secretary's Opportunity and Empowerment Award" as part of
APA's annual 1998 National Awards for Planning. The HUD Secretary's
Opportunity and Empowerment Award recognizes excellence in planning that
has led to measurable benefits in terms of increased economic, employment,
education, or housing choice or mobility for low- and moderate-income

To receive an APA application form (required for entry) please write HUD
USER at P.O. Box 6091, Rockville, MD 20849; or call 1-800-245-2691; or
download information at:

Judging for the award will take place in early February 1998 and
presentations will be made at the American Planning Association's national
conference in April 1998.

APA must receive all completed entries by Wednesday, January 21, 1998.

For current information on housing needs, market conditions, and existing
programs from HUD's Office of Policy Development and Research, visit the
HUD USER Web Site at  If you have comments on this
listserv or the HUD USER Web Site, please send email to

To stay abreast of new PD&R research and resources, subscribe to our
listserv, HUDUSERNEWS. This free service will automatically send--to your
e-mail address--publication announcements and other notices from the U.S.
Department of Housing and Urban Development's Office of Policy Development
and Research.

To subscribe to HUDUSERNEWS, simply send a message to:  In the body of the message, type: subscribe
hudusernews snd your e-mail address.


Public Housing Assessments

After a series of meetings with industry representatives, HUD has begun to
meet with residents and advocacy organizations on the reconfiguration of
the public housing management assessment program (PHMAP).  Currently,
public housing authorities (PHAs), at the end of their fiscal years, send
to their respective HUD field offices a self-completed PHMAP certification
form.  The field office then has 45 days to confirm / investigate the PHA's
self-completed form.  Field offices end up doing confirmatory reviews at
only a small sample of the developments within their purview.

The PHMAP is a management assessment and does not take into account the
physical status of the property.  HUD is holding meetings in order to
develop a more practical PHA performance evaluation system - one which will
most likely include an independent physical inspection, a financial audit,
a management review and a customer service indicator.  Each indicator will
include various components - HUD stakeholders in these meetings are trying
to determine the components and the method for carrying out the performance

Resident leadership representatives from across the country, organized to
participate by the Center for Community Change's Public Housing Residents'
National Organizing Campaign, were clear in their view that the stand-alone
customer service indicator is critical to the validity and usefulness of a
new performance evaluation.  According to notes from one of the industry
group meetings, a consensus was reached to subsume the customer service
indicator under the management indicator.  Residents were also clear in
their desire to have a resident component to each of the indicators.

HUD has invited residents back for a second meeting day on January 13.
Assistant Secretary for Public and Indian Housing Kevin Marchman has also
committed himself to one-day sessions on the new performance evaluation
system in various cities across the country.  HUD's goal is to have a new
performance evaluation system by early March.

People and Faces

After two years as Acting Assistant Secretary, Kevin Marchman, through a
Congressional recess appointment, was made Assistant Secretary for Public
and Indian Housing at HUD.

Field Notes

Public Housing Residents Organize

Residents across the country have organized themselves both by states and
by regions.  Actions are occurring from the "ground up" - versus from
Washington, D.C. out to the field.  In addition to working in regional and
state clusters, public housing tenants from each development are working
within those developments to ensure resident awareness of PHA plans for
their homes.  And, when needed, they are taking actions to ensure that
their rights and needs are protected in any plan to "save public housing"
that reduced the number of assisted units available to people who have low
incomes and that destroys housing in order to save it.

The Public Housing Residents Campaign is based on the following tenets:
1.  Public housing should be reserved for people who have low incomes who
most need it.
2. Rents should be set at affordable rates.
3.  Public housing should be protected from unwarranted demolition.
4.  Alternate property management models in public housing should be more
seriously proposed.
5.  Public housing governing boards should be required to include an ample
percentage of its residents.
6.  The overall management system of public housing should not be
7.  Ample federal funding should be annually appropriated for operating
subsidies, upkeep of property and essential resident activities.

To date, there has been one national rally - it took place simultaneously
in 30 different states on March 27th.  In addition, one regional meeting
for the southeast states was held from April 9th - 10th.  Other regions
will soon follow with their regional meetings to plan strategy and actions.

For names of regional and/or state public housing contact persons, please
call Othello Poulard at the Center for Community Change, 202/342-0519.  The
Center for Community Change is serving as the support / coordinating
organization for this national tenants action.

HUD Announces Proposed MTM Reg Development Schedule

HUD conducted a meeting for representatives of the various interest groups
this past week with Hill Staff participation.  The schedule called for
interest group input in a series of meetings from mid January through
February followed by regulation preparation by HUD.  After the period for
input, HUD will prepare regulations and manuals. They would expect interim
regulations for effect to be submitted to OMB and Congress for review in
late May with publication in mid June.

Loss of Subsidized Stock in California Profiled in State Legislative

In 1989 prior to the passage of LIHPRHA and the many other changes in
housing resources in the past several years, many predicted the loss of
10,000 of affordable units.  It didn't happen. LIHPRHA passed, localities
and community groups struggled to save or replace units which had to be
removed because of condition and the market sagged making the use of
vouchers and certificates in both the San Francisco Bay Area and the Los
Angeles Environs possible.

It 1997 and the derriere predictions of the late 1980's are reality. HUD
Secretary's Liaison Art Agnos, testified at recent hearings that owners
representing approximately 50,000 units have began the process to prepay
the FHA insured and regulated mortgages and/or indicated that they will not
renew Project Based Section 8 Contracts. Various experts in California
believe that upwards of 10,000 to 20,000 units where rents are capped or
subsidies are attached will be lost as permanent affordable housing.  This
problem is coupled with an increasing difficulty in using Section 8
vouchers and certificates because of rapidly increasing rents which often
exceed FMR's and owner reluctance to be involved in long term lease
arrangements at modest rent levels.

This situation while not as acute in other parts of the country is also
happening where similar market conditions and HUD practices relating to
enforcement mean owner prepayment, nonrenewal of contracts and/or
foreclosure and resale of properties for market rate housing.

Developments Continue on Universal Service

Federal Communications Commission Chairman William Kennard announced late
on December 15 that the rate of contribution by companies to the universal
service fund for libraries and schools would be reduced for the first six
months of 1998.  Under the revised plan, $625 million would be collected in
the first half of the year.

This change affects collections but not disbursements.  The original cap of
$2.25 billion for the full year would remain in place, and the program
would start up as planned on January 1.  A reconsideration order formally
announcing the new contribution rate is expected from the FCC today.
ALAWON will provide more details once documentation is available.

Separately, there are reports that major long distance companies would not
put a line item on residential long distance bills for the first six months
of 1998, although a line item can be expected on business bills.

The FCC May order on universal service (FCC 97-157) stated in paragraph 855
(; paragraph 855) that
the universal service contribution is not a federally mandated direct
end-user surcharge, and that it would be misleading for a carrier to
characterize its contribution as a surcharge.  If companies choose to pass
through their contributions and specify that on customers' bills, they must
convey information to customers accurately.  (Essentially, such an action
is a company's choice, not a requirement of the law or the FCC rule.)

ALA is aware that many libraries have now received discount application
forms from the Schools and Libraries Corporation, and have planned for and
are ready to see this program begin.  ALA remains concerned that all
library users and students, particularly those in rural and low income
areas, be fully able to benefit from the discount program.  We are
appreciative of those libraries that got involved in the most recent threat
to the discounts; without that involvement the current outcome might indeed
have been significant delay or serious cutbacks.

Please continue to thank your Senators and Representatives for their part
in approving the library/school portion of universalservice in the
Telecommunications Act of 1996, and continue tokeep them informed about the
importance of this program tolibrary services to their constituents.

ALAWON is a free, irregular publication of the American LibraryAssociation
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20004-1701--800.941.8478 (V) Lynne E. Bradley, Editor,,
Deirdre Herman, Managing Editor,

LIHEAP Program Slated for Cuts

The Clinton Administration plans to cu the Low Income Home Energy
Assistance Program(LIHEAP) by as much as 32% in FY 1999.  This is
approximately a $350 million cut from the $1.1 billion for FY 1999 that was
approved by Congress this fall.

The Northeast/Midwest Coalition issued a statement expressing its concern
about the Clinton Administration's draft proposal to cut LIHEAP in FY 1999.
This proposal most like came from The Office of Management and Budget
(OMB), which recommended a cutback and phase-out of the program last year.
The Senate Coalition has written to the President asking that he propose at
least $1.215 billion or the FY 1999 LIHEAP in his budget request.  Congress
has moved in the direction of restoring funding for LIHEAP, approving and
advance appropriation for FY 1991 of $1.1 billion.

Representative Kennedy (D-MA) and Gephardt (D-MO) are circulating a letter
in the House requesting a $500 million increase for LIHEAP in the Clinton
Administration's FY 1999 Budget Request.  You should contact Democratic
Members of Congress to urge them to either sign on to the Kennedy/Gephardt
letter to the President and to call the White House Office of Legislation
to express their support for funding FY 1999 LIHEAP at no less than last
year's level of $1.215 billion.

AFL-CIO Celebrates Labor and Community Partnerships

Last week the AFL-CIO Housing Investment Trust celebrated innovations and
success stories where labor has invested in building and rebuilding
communities.  Awardees included the City of San Francisco represented by
Mayor Willie Brown, the New Jersey Economic Development Authority, the
Building and Construction Trades Department of the AFL-CIO represented by
Robert Georgine, Azteca Economic Development and Preservation Corporation
represented by longtime NLIHC Board Member Rafael Torres, the Marco
Consulting Group,  the Carpenters Pension Trust Fund of St. Louis, the
Mercantile-Safe Deposit and Trust Company, the Planning Office for Urban
Affairs for the Archdiocese of Boston and the International Masonry
Institute. The Trust took a moment to recognize the talented efforts of
Helen Kanovsky who has recently left the Trust to be Chief of Staff for
Senator John Kerry.

To quote Richard Ravitch, Chair of the Board of Trustees of the AFL-CIO
Housing Investment Trust, "these individuals are exemplary of the hundreds
of individuals and organizations who share a commitment to improving the
economic well-being and quality of life for pension beneficiaries, their
families and their neighbors".

Coalition News ....

We Are Moving.....

Between Christmas and New Years, NLIHC is moving downstairs from Suite 1200
to Suite 610. Beginning after the first of the year we will have a new home
to be shared with the National Homeless Coalition. We look forward to the
opportunity to work more closely with our partner, NHC and to move to space
with fresh paint and new carpet.  Phone and fax will be the same.  Between
December 24 and January 5, please be patient if it takes a little while to
return your call or fax. Hope you will be able to visit us in our new home
next year.

We Are Changing Our Membership Cycle....

Many of you recently got letters asking you to renew your membership for
1998. We so appreciate your attention to our letter.  In some cases you got
a letter asking you to join if your membership had lapsed even briefly. We
apologize for not catching the second group and simply including them in
the renew request. We very much appreciate your support for the Coalition
and hope you will renew for 1998.

Memo to Members...

Memo will be on vacation until January 9.

Happy Holidays and May 1998 Be the Year of the Success Story in Affordable

1998 Calendar
Housing and Community Development Events

Please send us the date, location, topic, and staff contact info via E-Mail
to or fax to 202-393-1973.  We want to hear from you!  We
print as much as space can permit herein Memo, but see our calendar on the


  Jan. 13-16, Fort Worth, TX- "Project Development Program" for
CHDOs-Series II
Development Training Institute--Contact Kelly Grimes at 410-338-2512,

  Jan. 14-16, Boca Raton, FL Annual Meeting
The National Multi Housing Council--Contact Bonnie Reid at 202-659-3381,

  Jan. 29-31, Washington, DC--"Role of CDFIs in Community Development"--
The Coalition of Community Development Financial Institutions--Contact
Monifa Williams at 215-923-5356, e-mail

  Jan. 16-19, Dallas, TX--The Builders Show
National Association of Home Builders (NAHB)--Call 202-822-0200 or fax

  Jan. 22-23, Tampa, FL-- "Welfare-to-Work"
National Association of Housing and Redevelopment Officials
(NAHRO)--Contact Moria Brown at 202-289-3500, e-mail

  Jan. 22-24, Atlanta, GA-- "Revitalizing Housing Quality Standards
National Association of Housing and Redevelopment Officials
(NAHRO)--Contact Jill Quaid at 202-289-3500 or fax 202-289-4949

  Jan. 26-27, Temple AZ-- "Managing Economic Development Organizations"
National Council for Urban Economic Development (CUED)--Contact Cathy
Katona at 202-223-4735, e-mail

  Jan. 28-30, Indian Wells, CA--Mid Year membership Meeting
National Leased Housing Association (NLHA), call 202-785-8888 or fax


  Feb. 1-4, San Francisco, CA Commercial Real Estate Finance/Multifamily
Housing Conference
Mortgage Bankers Association of America (MBAA) call, 800-793-6222 or fax

  Feb. 2-3, Charlotte, NC--Annual Conference and Membership Meeting
North Carolina Low Income Housing Coalition, call 919-881-0707 or e-mail

  Feb. 9-13 Atlanta, GA--Neighborhood Reinvestment Training Institute
Neighborhood Reinvestment Corporation (NRC) call 800-438-5547, e-mail

  Feb. 9-13 Albuquerque, NM--Section 8 Series
National Association of Housing and Redevelopment Officials (NAHRO) call
Moria Brown at 202-289-3500, e-mail


Current Issue of Memo

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and future "current" issues.


Write Us!

Write or phone specific staff members:

Helen Dunlap, President, x225, e-mail Helen
    Linda Couch, Legislative Associate & Faith Outreach, x242, e-mail Linda
    Darlene Jones, Administrative Assistant, Publications Orders, x243,
e-mail Darlene
    Tracy Kaufman, Researcher, x237, e-mail Tracy
    Deirdre McIntyre, Webmaster & Systems; Telecommunications Policy, x226
e-mail Deirdre
    Tomiquia Moss, Intern, x227, e-mail Tomiquia
    Frances Williams, Assistant to the President, Membership, Meetings
x224, e-mail Frances
    National Low Income Housing Coalition (NLIHC)
1012 Fourteenth Street NW
Suite 1200
Washington, D.C. 20005
Fax 202/393-1973
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