Two Key Lawmakers Sponsor Related Legislation
PHADA President Mark Gillett.
I have previously written that PHADA believes HAs should be afforded more local flexibility in the administration of our programs. This has been a theme the association has advocated for many years. Our Board of Trustees reiterated that support in its most recent strategic planning meeting, identifying some key points to serve as an overall guide. Now, we find ourselves in a situation where the newly confirmed HUD Secretary and two key congressional leaders largely agree with our perspective.
The challenge now is to try and make our vision a reality by working with HUD, lawmakers on both sides of Capitol Hill, and industry partners. We believe this change is especially needed now based on the realities facing domestic discretionary programs funded by Congress.
The Local Flexibility Option
PHADA’s plan is for a Local Flexibility Option (LFO) that is based on the original Moving to Work Demonstration (MTW) program. We know that one size does not fit all for thousands of local housing agencies. PHADA therefore supports legislation allowing housing authorities the flexibility to operate within the context of the conditions in their own communities. This approach has been assessed through the original MTW program, not HUD’s more recent expansion. That flawed version is helpful but does not go far enough to provide HAs with latitude.
We envision a rollback of federal restrictions and requirements on our operations and housing authorities in general. 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 pandemic era CARES Act waivers demonstrate greater effectiveness that can be achieved by local agencies with such flexibility.
- Elimination or revision of rules and restrictions that inhibit innovation and experimentation. Several MTW HAs have successfully increased their affordable housing stock through those innovations and partnerships. A workable LFO could prove particularly useful at a time when housing affordability—and lack of availability—has reached crisis proportions.
- Rollback of some HUD oversight and monitoring reporting systems and regulatory micromanagement while still ensuring accountability on the part of HAs. Such an approach would not only help us but will be needed considering likely staff reductions at HUD.
Congressional Legislation
Sen. Tim Scott (R-SC) is the new Chairman of the Committee on Banking, Housing, and Urban Affairs. During the last congressional session, 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. The MTW portion is part of a larger housing bill sponsored by the Senator.
Key objectives outlined in Scott’s bill include providing residents with more opportunities for economic independence and housing choice. At the same time, HAs would be allowed to develop local and flexible policies that are 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. A similar bill has been introduced by the House of Representatives’ Financial Services Committee Chairman, French Hill (R-AR).
PHADA’s Board and our policy staff have reviewed the legislation and have some suggestions to improve it. PHADA spoke with the Senator’s staff very recently, renewing our desire to work on this legislation. The bill’s recent reintroduction provides a vehicle to advance a much-needed conversation in Congress.
We are enthusiastic but realistic about the prospects for this legislation. First, getting any legislation through Congress in recent years has proved quite difficult. Second, while we know MTW is successful and works well, it still has opponents, who fear HAs will impose harsh rent increases, unfair work requirements or time limits that threaten vulnerable residents. These kinds of fears have proved unwarranted, as no such harm has been demonstrated in the almost 30-year history of the program. Not to mention the fact that HA plans will require local and HUD review before implementation.
Opponents sometimes say that this approach could result in negative financial consequences because Congress might “block grant” funding to HAs, making it easier to reduce our resources. Critics ignore the present budget environment in which our funding is already inadequate and threatened more. A Local Flexibility Option would give us more latitude to use our limited funds more effectively.
Conclusion
Some HAs have successfully converted and prospered under the Rental Assistance Demonstration (RAD). For a variety of reasons, RAD does 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 another option that allows local housing authorities to operate better within the context of their local conditions. There is a successful model in place—the original MTW program.
Again, the reintroduction of this legislation in the new Congress is helpful because it increases the chance for deliberation on Capitol Hill, 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.