Bill Would Authorize Expansion of Original MTW Program
PHADA President Mark Gillett.
You will receive this Advocate just a few days short of the new federal fiscal year that starts on October 1. As indicated in a separate article elsewhere in this edition, we are still a way off from enactment of a final spending bill. However, it does appear certain that funding for our programs will again be insufficient to address needs.
Pending versions of the House and Senate appropriations bills are similar in their overall funding for public and assisted housing accounts. A comparison of the two bills is included in the chart in PHADA’s Position Paper on page 7. The most significant difference is the Senate appropriation of about $400 million more in operating funds, a provision that PHADA supports. The House bill, meanwhile, slashes the HOME program by more than 60 percent, which we strongly oppose. Working with our industry partners and other housing advocates, the association will continue to push for the greatest sums possible in a final FY 24 bill.
More Local Flexibility Still Needed
Unfortunately, insufficient funding is a scenario we have encountered all too frequently. This is one of several reasons why PHADA believes HAs should be afforded more local flexibility in the administration of our programs. Indeed, we have pushed this theme for many years.
We reiterated our support during a more recent Board retreat, identifying some key points to serve as an overall guide.
Since one size does not fit all for thousands of local agencies, PHADA supports legislation allowing public housing authorities flexibility to operate within the context of their conditions in their own communities. This approach has been assessed through the original Moving to Work Demonstration program, not HUD’s more recent expansion. That flawed version of the program is helpful but does not go far enough to provide HAs with enough flexibility or the keys to true innovation.
As I mentioned above, public housing has been underfunded for decades, as have Section 8 administrative fees. PHADA therefore recommends a broad rollback of federal restrictions and requirements on both public housing operations and public housing authorities. Highlights of our approach would include:
- Greater flexibility in the use of funds. The success of both the MTW Demonstration agencies and the effective use of flexibility granted through CARES Act waivers demonstrate the greater effectiveness that can be achieved by local agencies with such flexibility.
- Elimination or revision of rules and restrictions that inhibit innovation and experimentation.
- Rollback of some HUD oversight and monitoring reporting systems and regulatory micromanagement while still ensuring accountability on the part of HAs.
New Senate Legislation
Sen. Tim Scott (R-SC).
PHADA’s preferred approach is embodied in legislation that an influential lawmaker will soon formally introduce. Sen. Tim Scott (R-SC) is the Ranking Member on the Senate’s Committee on Banking, Housing, and Urban Affairs. His staff shared legislation with PHADA that includes a major expansion for MTW. Importantly, the legislation would authorize HAs to transition to the original version of the program.
Key objectives outlined in Sen. Scott’s bill include providing residents more opportunities for economic independence and housing choice. At the same time, HAs would be allowed to develop local and flexible policies that are also potentially more cost efficient. In addition, the bill states there would be “no limitation” on the number of agencies that could participate. The bill also removes the demonstration status and permanently authorizes the MTW program.
Times and Circumstances Dictate Need for Change
Looking at the situation realistically, we do not see prospects for much improvement in this congressional session or anytime soon. We face strict limits on overall federal spending and continuing inflation. This leaves us in a situation where costs are continuing to rise, and funding is stagnant. Further compounding the problem, HUD and Congress continue to add regulatory burdens. Among others, these include new inspection requirements and costs, and the “Buy American” requirements that will be implemented in 2024.
Some HAs have been able to thrive through conversions under the Rental Assistance Demonstration (RAD) as well as voluntary conversions for small HAs. For a variety of reasons, those programs do not work for many HAs. The situation is untenable for many agencies and the millions of people we serve. If HAs are going to succeed, we will need an approach that allows local housing authorities to better operate within the context of their local conditions.
There is a successful model in place that the Biden Administration and Congress should look to – the original MTW program. The introduction of Sen. Scott’s bill is helpful because it should increase the needed congressional discourse on the matter, hopefully leading to enactment. For its part, PHADA will do all it can to promote the theme of local flexibility along with this important legislation.