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THE FUTURE OF HOUSING IN AMERICA: 

FEDERAL HOUSING REFORMS THAT 

CREATE HOUSING OPPORTUNITY 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

HOUSING AND INSURANCE 

OF THE

COMMITTEE ON FINANCIAL SERVICES 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

OCTOBER 21, 2015 

Printed for the use of the Committee on Financial Services 

Serial No. 114–56 

( 

(II) 

HOUSE COMMITTEE ON FINANCIAL SERVICES 

JEB HENSARLING, Texas, Chairman 

PATRICK T. MCHENRY, North Carolina, 

Vice Chairman 

PETER T. KING, New York 

EDWARD R. ROYCE, California 

FRANK D. LUCAS, Oklahoma 

SCOTT GARRETT, New Jersey 

RANDY NEUGEBAUER, Texas 

STEVAN PEARCE, New Mexico 

BILL POSEY, Florida 

MICHAEL G. FITZPATRICK, Pennsylvania 

LYNN A. WESTMORELAND, Georgia 

BLAINE LUETKEMEYER, Missouri 

BILL HUIZENGA, Michigan 

SEAN P. DUFFY, Wisconsin 

ROBERT HURT, Virginia 

STEVE STIVERS, Ohio 

STEPHEN LEE FINCHER, Tennessee 

MARLIN A. STUTZMAN, Indiana 

MICK MULVANEY, South Carolina 

RANDY HULTGREN, Illinois 

DENNIS A. ROSS, Florida 

ROBERT PITTENGER, North Carolina 

ANN WAGNER, Missouri 

ANDY BARR, Kentucky 

KEITH J. ROTHFUS, Pennsylvania 

LUKE MESSER, Indiana 

DAVID SCHWEIKERT, Arizona 

FRANK GUINTA, New Hampshire 

SCOTT TIPTON, Colorado 

ROGER WILLIAMS, Texas 

BRUCE POLIQUIN, Maine 

MIA LOVE, Utah 

FRENCH HILL, Arkansas 

TOM EMMER, Minnesota 

MAXINE WATERS, California, Ranking 

Member 

CAROLYN B. MALONEY, New York 

NYDIA M. VELA ́ ZQUEZ, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

MICHAEL E. CAPUANO, Massachusetts 

RUBE ́ N HINOJOSA, Texas 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

DAVID SCOTT, Georgia 

AL GREEN, Texas 

EMANUEL CLEAVER, Missouri 

GWEN MOORE, Wisconsin 

KEITH ELLISON, Minnesota 

ED PERLMUTTER, Colorado 

JAMES A. HIMES, Connecticut 

JOHN C. CARNEY, JR., Delaware 

TERRI A. SEWELL, Alabama 

BILL FOSTER, Illinois 

DANIEL T. KILDEE, Michigan 

PATRICK MURPHY, Florida 

JOHN K. DELANEY, Maryland 

KYRSTEN SINEMA, Arizona 

JOYCE BEATTY, Ohio 

DENNY HECK, Washington 

JUAN VARGAS, California 

SHANNON MCGAHN, Staff Director 

JAMES H. CLINGER, Chief Counsel 

(III) 

SUBCOMMITTEE ON HOUSING AND INSURANCE

BLAINE LUETKEMEYER, Missouri, Chairman 

LYNN A. WESTMORELAND, Georgia, Vice 

Chairman 

EDWARD R. ROYCE, California 

SCOTT GARRETT, New Jersey 

STEVAN PEARCE, New Mexico 

BILL POSEY, Florida 

ROBERT HURT, Virginia 

STEVE STIVERS, Ohio 

DENNIS A. ROSS, Florida 

ANDY BARR, Kentucky 

KEITH J. ROTHFUS, Pennsylvania 

ROGER WILLIAMS, Texas 

EMANUEL CLEAVER, Missouri, Ranking 

Member 

NYDIA M. VELA ́ ZQUEZ, New York 

MICHAEL E. CAPUANO, Massachusetts 

WM. LACY CLAY, Missouri 

AL GREEN, Texas 

GWEN MOORE, Wisconsin 

KEITH ELLISON, Minnesota 

JOYCE BEATTY, Ohio 

DANIEL T. KILDEE, Michigan 

(V) 

C O N T E N T S 

Page 

Hearing held on: 

October 21, 2015 ............................................................................................... 1 

Appendix: 

October 21, 2015 ............................................................................................... 29 

WITNESSES 

WEDNESDAY, OCTOBER 21, 2015 

The witnesses presented no oral testimony at this hearing. Due to time 

constraints, the Members gave opening statements and proceeded directly 

to questioning the witnesses. All of the written statements that the witnesses submitted can be accessed in the Appendix (see below). ......................

APPENDIX 

Prepared statements: 

Bradley-Geary, Heather, Lead Developer, Supportive Housing, The 

Vecino Group ................................................................................................. 30 

Burns, Laura, Board Member, National Leased Housing Association ......... 32 

Craig, Evelyn E., President and CEO, reStart, Inc. ...................................... 36 

Fischer, Will, Senior Policy Analyst, Center on Budget and Policy Priorities ................................................................................................................. 38 

Gawrilow, Hilary Swab, Director, Federal Policy, Corporation for Supportive Housing ............................................................................................. 47 

Kelly, Kevin, 2014 Chairman of the Board, National Association of Home 

Builders .......................................................................................................... 50 

Merritt, Stephen W., Executive Director, Norwood Housing Authority, 

and President, National Association of Housing and Redevelopment 

Officials (NAHRO) ........................................................................................ 57 

Polychron, Chris, 2015 President, National Association of REALTORS® .. 62 

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

Luetkemeyer, Hon. Blaine: 

Letter from the Corporation for Supportive Housing, dated October 21, 

2015 ................................................................................................................ 78 

Letter from the Housing Assistance Council, dated October 20, 2015 ........ 80 

Letter from the National Multifamily Housing Council and the National 

Apartment Association, dated October 20, 2015 ........................................ 81 

Letter from representatives of the real estate industry, dated October 

20, 2015 .......................................................................................................... 83 

(1) 

THE FUTURE OF HOUSING IN AMERICA: 

FEDERAL HOUSING REFORMS THAT 

CREATE HOUSING OPPORTUNITY 

Wednesday, October 21, 2015 

U.S. HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON HOUSING

AND INSURANCE, 

COMMITTEE ON FINANCIAL SERVICES, 

Washington, D.C. 

The subcommittee met, pursuant to notice, at 2:01 p.m., in room 

2128, Rayburn House Office Building, Hon. Blaine Luetkemeyer 

[chairman of the subcommittee] presiding. 

Members present: Representatives Luetkemeyer, Pearce, Ross, 

Barr, Rothfus, Williams; Cleaver, Capuano, Clay, Green, Ellison, 

Beatty, and Kildee. 

Also present: Representatives Sherman and Carney. 

Chairman LUETKEMEYER. The Subcommittee on Housing and Insurance will come to order. Without objection, the Chair is authorized to declare a recess of the subcommittee at any time. And unfortunately, they just called votes, so we may call a recess here in 

about 5 or 6 minutes. As a matter of fact, they have already called 

votes, and we are down to 12 minutes left in the vote. 

I think what we are going to do is, myself and Mr. Cleaver, the 

ranking member of the subcommittee, will give our opening statements. We will then recess. We have 4 votes, which will probably 

take about 40, 45 minutes. Then, we will come back, and at that 

time we will begin the discussion, and we can begin the questions. 

So with that, let me just continue on. Today’s hearing is entitled, 

‘‘The Future of Housing in America: Federal Housing Reforms That 

Create Housing Opportunity.’’ Before we begin, I would like to 

thank the witnesses for appearing before the subcommittee today. 

We look forward to your insightful comments. I now recognize myself for 3 minutes to give an opening statement. 

This panel represents a diverse cross section of the housing community. We have a REALTOR®, a home builder, a nonprofit executive, a public housing authority director, a witness who specializes 

in affordable housing development, and housing policy experts. 

There is a common bond that links these individuals: the mission 

to provide housing to Americans and to provide the foundation for 

better lives and build better communities. Many of these witnesses 

share another commonalty, the desire to see changes in Federal 

programs so they can more easily serve the families in need. That 

is why this committee solicits organizations like the ones repVerDate Nov 24 2008 15:17 Sep 16, 2016 Jkt 099754 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 K:\DOCS\99754.TXT TERI
2 

resented today for ideas on how to cut red tape, and replace it with 

opportunity. 

I am proud to have introduced H.R. 3700, the Housing Opportunity Through Modernization Act of 2015. I will be the first to 

point out that this legislation won’t necessarily change the world. 

It won’t end homelessness overnight, or meet the overwhelming 

need for affordable housing, but it is a first step in a long journey 

to reforming our housing system. We have to take a first step before we can get a second step. Right? This bill came to be because 

of the input provided by many of you, and I thank you for your participation. 

My legislation doesn’t include everything I want. I recognize that 

it doesn’t include everything the minority wants, or that housing 

advocates want. But it does represent an opportunity to show that 

despite rhetoric and what goes on around here daily, Congress can 

work together, and in collaboration with a diverse group of stakeholders, to foster a positive change. 

Also, I want to point out that Chairman Hensarling has asked 

for additional ideas in the fight against poverty and for a reformed 

housing system. I know the chairman wants to hear ideas from different points of view in different parts of the country. This is another opportunity to make your voice heard and participate in the 

process, and I encourage you to take advantage of it. 

Tomorrow morning, the full Financial Services Committee will 

hold a hearing to examine 50 years of HUD, and the impact the 

Department has had on our Nation. Fifty years later, too many 

Americans are in need, with too few resources to be had. We are 

past the time to act. It is my hope that the spirit of bipartisanship 

will last long enough, after H.R. 3700 has been signed into law, 

that we can all work together to discuss additional reforms to HUD 

and the Rural Housing Service. 

The status quo is no longer good enough. The majority of provisions in H.R. 3700 were agreed to years ago by advocacy and interested groups, and it is time Congress put these changes on the 

President’s desk. I want to again thank the witnesses for appearing 

today, and we look forward to your discussion. 

With that, I recognize the gentleman from Missouri, the ranking 

member of the subcommittee, Mr. Cleaver, for 5 minutes for an 

opening statement. 

Mr. CLEAVER. Thank you, Mr. Chairman. I appreciate the panel 

giving us your time, and in the spirit of trying to get there in time 

to vote, I won’t take the full 5 minutes. 

I would like to associate myself with the comments of the chairman of the subcommittee. Political compromising means keeping 

your shirt on and still getting something off your chest, and I think 

that is what we have been able to do is to work through knotty 

problems, and we believe that we will reform, and HUD will perform. 

The way in which we have dealt with this legislation, I think, is 

a style that we need to use to get a lot of things done. Congressman Luetkemeyer and I don’t think concurrently, but we do think 

collaboratively, and I think that is one of the benefits of us working 

together on this bill. And I do have a few remaining questions on 

the bill, but I do think that we will be able to work those things 

3 

out, and I am grateful for this hearing and the opportunity to move 

forward on H.R. 3700. 

Thank you, Mr. Chairman. I yield back the rest of my time. 

Chairman LUETKEMEYER. I thank the gentleman. 

It took two men from the ‘‘Show Me’’ State to show everybody 

that we can get things done and work together, and we are more 

than happy to do that. 

Again, we apologize to the distinguished panel of witnesses 

today. They schedule votes whenever they feel it is necessary, and 

as a result we have a duty that we are supposed to take care of, 

which is to go vote and take care of some of the business of the 

country, and of our citizens. 

So with that, we will recess until such time as the votes are concluded. Thank you. 

[recess] 

Chairman LUETKEMEYER. Okay. I appreciate your indulgence. 

Sorry for the interruption, but we are back, and we will try and 

expedite this as quickly as possible. To do so, we are going to forego 

the oral testimony of all of the witnesses. Your written testimony 

was all handed out. We have read it already, and we are going to 

go straight to the questions. So I have a few comments to make, 

and then introductions, and then Mr. Cleaver has an introduction, 

and we will go right to questions. 

Today, we welcome the testimony of Ms. Laura Burns, board 

member of the National Leased Housing Association; Ms. Heather 

Bradley-Geary, lead developer for supportive housing, The Vecino 

Group; Ms. Evelyn Craig, president and CEO of reStart, Incorporated; Mr. Chris Polychron, 2015 president, National Association 

of REALTORS®; Mr. Stephen Merritt, Norwood Housing Authority, 

on behalf of the National Association of Housing and Redevelopment Officials; Mr. Kevin Kelly, 2014 chairman of the board, National Association of Home Builders; Mr. Will Fischer, senior policy 

analyst, Center on Budget and Policy Priorities; and Ms. Hilary 

Swab Gawrilow, director of Federal policy, Cooperation for Supportive Housing. I apologize if I mispronounced any of your names. 

With a name like ‘‘Luetkemeyer,’’ that happens to me regularly, 

and so my apologies. It never seems to bother me, but if it does 

you, I certainly apologize. 

Given the large number of witnesses, the ranking member and 

I have agreed to waive oral statements from the witnesses, meaning we are going to move directly into the questions. 

And without objection, your full written statements will be made 

a part of the record. 

Before turning to questions, I want to extend a special welcome 

to two Missourians on today’s panel. Ms. Heather Bradley-Geary 

has long been an advocate for Missourians in need, and has dedicated her career to fighting homelessness, and ensuring that those 

in need, particularly children, have supporting housing options 

they need. 

Heather, thank you for being here today, and we look forward to 

your testimony. And now I turn to Mr. Cleaver to introduce Ms. 

Evie Craig, our other witness from Missouri. 

Mr. CLEAVER. Thank you, Mr. Chairman. I take great pleasure 

in introducing Evie Craig from the State’s largest City, Kansas 

4 

City. Ms. Craig, as the chairman mentioned, is the executive director of reStart, Inc., which is an interfaith ministry serving homeless men, women, youth, and families in the urban center of Kansas City. She has been in this position for 13 years, and I am very 

pleased that she has been there for 13 years. We have been able 

to work together. She has grown reStart’s annual budget from $1.3 million in 2004, to $7.17 million in 2015, which also points out the severity of the 

issue of homelessness. And she serves on the Jackson County Mental Health Commission, the executive committee of the Greater 

Kansas City Regional Task Force on Homelessness, and is the local 

Chair of the 100,000 Homes Campaign to provide housing for vulnerable individuals and families, among her other distinguished accomplishments. Ms. Craig, we are pleased to have you here. Thank 

you, Mr. Chairman. 

Chairman LUETKEMEYER. Thank you. And with that, I recognize 

myself for 5 minutes to begin the questioning. 

Obviously, all of you seem to be supportive of H.R. 3700, and I 

thank you for that. We have worked diligently to try and work with 

all the parties to come to an agreement on something that we can 

all find some support for, and along the way, we thank each of you 

for your help in getting to where we have gotten with this piece 

of legislation. 

I recognize there is more work to be done, and with that, I would 

like to ask what other things you would like to see in the bill, or 

any things you would like to, in particular, point out that are important to you? Let me start with Ms. Burns. 

Ms. BURNS. Thank you, Chairman Luetkemeyer, Ranking Member Cleaver, and distinguished members of the subcommittee. My 

name is Laura Burns, and I am here on behalf of the National 

Leased Housing Association. I am also a national affordable housing developer with 14 properties in Missouri and 2,000 units, so I 

am proud to own properties in your great State. 

Chairman LUETKEMEYER. And that is a great decision, I can tell 

you. 

Ms. BURNS. Some of the things that we think are really important in this bill that are really helpful, the steps might seem small 

to some but they seem quite material to us. The inspection standards changes that is included in the bill is very important to us. 

Our company provides housing through project-based contracts, 

through housing choice vouchers, through project voucher contracts, and through tenant vouchers. And some of the changes that 

are proposed in both the inspection standards, the recertification of 

fixed-income residents being allowed every 3 years, and the increased flexibility to the project-based voucher program will make 

a big difference. 

We have a property, for instance, in St. Louis with a housing 

choice voucher contract, and some of the program changes that are 

included here would have really made a difference to how efficiently this property operated over the years. We are in year 12 of 

our contract and have experienced many of the things that this bill 

looks to address, including significant delays in occupancy as a result of inspections; 30 days is very normal. Sometimes, we see as 

long as 90 days before a new resident can move in. 

5 

Site-based waiting lists are really important when the list is so 

long, and the rent increase process of having certainty in how the 

program is going to work when you marry that with the low income 

housing tax credit program, those are really helpful to our industry 

and to doing future deals. 

Chairman LUETKEMEYER. Thank you. Ms. Bradley-Geary? 

Ms. BRADLEY-GEARY. Thank you. I agree with Ms. Burns. There 

are a lot of great things in H.R. 3700, but I want to focus specifically on the Family Unification Program (FUP) vouchers, which 

has a horrible acronym, so I apologize. These are vouchers for our 

young adults who are leaving foster care, and I stand before you 

with three hats. I am a supportive housing developer who does a 

lot of development for young people who are aging out of foster 

care. 

I am also a foster care parent. Both of my kids are adopted from 

the foster care system in Missouri, and I am also a social worker. 

So, as you know, we have 23,000 kids, young adults who leave foster care every year. One in five of those are going to become homeless if we don’t do something to stop that. 

Chairman LUETKEMEYER. Is there anything that we can do or 

change, do something different to— 

Ms. BRADLEY-GEARY. I believe— 

Chairman LUETKEMEYER. —improve it or—we are taking a first 

step here. What is the next step we need to take? 

Ms. BRADLEY-GEARY. Absolutely. I believe you have added the 

language in the bill that we are asking for, and that is to up the 

time from 18 to 36 months if the voucher is eligible for the youth, 

and then also to up the age from 21 to 24 for our youth who are 

aging out of foster care to be eligible for those vouchers. 

Chairman LUETKEMEYER. What is the reason for jumping the age 

from 21 to 24? 

Ms. BRADLEY-GEARY. A lot of our kids leave the foster care system, and they still need the support up to age 24—I will use myself 

as an example. I had a safety net as a child that my parents were 

there when I was making bad decisions. These youth do not have 

a safety net. If we up the age to 24, we are able to catch a lot of 

those youth in those 3 years who do not have a safety net, so that 

allows us to give them that. 

Chairman LUETKEMEYER. How many kids are we talking about 

here who utilize this, that you anticipate utilizing it, how many 

kids do you anticipate utilizing these vouchers? 

Ms. BRADLEY-GEARY. Using the vouchers? In Missouri alone, our 

estimates come in at about 1,800 kids who are aging out, about 

one-fifth of those, so that would be 374 youth who would be eligible 

for those, and that is just Missouri. 

Chairman LUETKEMEYER. This is a very important issue to me 

because I think that this is an area where we can actually make 

a difference. 

Ms. BRADLEY-GEARY. Absolutely. 

Chairman LUETKEMEYER. I see I am about timed out. Let me 

stop here and I will— 

Ms. BRADLEY-GEARY. Thank you. 

6 

Chairman LUETKEMEYER. —thank you for your testimony. I now 

recognize the gentleman from Missouri, Mr. Cleaver, the ranking 

member of the subcommittee, for 5 minutes. 

Mr. CLEAVER. Thank you. I know many, if not almost everybody 

on the panel, and I appreciate all the work that you all have done 

over the years, but I want to send this question to Ms. Craig and 

Ms. Gawrilow. 

I can see in your facial expression how much you wish you were 

still here and sitting up here. But your advocates for foster care 

youth and you championed for changes to help improve housing 

services for young adults, and Ms. Craig, you were saying in your 

statement that more than 800 young adults aged out of the foster 

care system in Jackson County. How has the family unification 

program in our proposed bill been helpful in addressing the needs 

of our foster youth? 

Ms. CRAIG. I’m sorry, did you want me to answer first, Congressman? 

Mr. CLEAVER. Yes. 

Ms. CRAIG. I wanted to say, though, the Royals do play today. 

Mr. CLEAVER. Yes. Oh, my goodness. 

Ms. CRAIG. So we are up against some very— 

Mr. CLEAVER. We need to get out of here. 

Ms. CRAIG. —important—just saying. This happened to me 24 

hours ago at the city council testifying before the mayor’s legislative committee, so it brought good luck, so we can only hope, right. 

So sorry. 

Presently, there are lots of barriers to young adults, and specifically young adults in foster care, getting access to these housing resources, and transition age is a very, very, important time because 

we are looking at young people who haven’t had some normal developmental supports, and developmental growth is critical to successful adulthood. 

So this opportunity to have stable housing, and I think one of the 

provisions that I understand is—this may seem like a technicality, 

but it is huge in the life of a young adult—the opportunity to get 

access to a housing voucher 90 days before you are out of the system. That means, ta-da, it is amazing that you can get services and 

housing simultaneously for a 90-day period while you wait on that 

cusp of being independent. 

That is the kind of support that many people get from their families or extended families, and a lot of the young people that we 

work with don’t have that. They do, as we see, fall not only into 

homelessness but don’t graduate from high school, or 46 percent 

are unemployed by the age of 24, and what really we end up saying 

to them is, quite frankly, if you wait long enough and you are 

homeless long enough, we will get you housing just in time to die. 

We need to be able to use our Federal housing resources to get 

young people into housing in order to live their life to its fullest potential, and that is where I really feel very strongly that this bill, 

it may seem regulatory in nature, I don’t know, but I see it as having the capacity to have an amazing impact on the future of our 

country because these young people have that opportunity, but only 

if they can get some of these resources. 

7 

And I think what is for all of us, and we have been talking a little bit as we are here, we work in the world, some of us, of the red 

tape and the regulations, and there are things that no one—never 

by intent did anyone mean to put a barrier in front of a young child 

exiting foster care, but it is there nonetheless because of the inability of agencies to work together or us to be able to provide the resources. So I think the flexibility that has been added into the language around FUP has the possibility to be really simply transformational. 

Mr. CLEAVER. Thank you. Ms. Gawrilow? 

Ms. GAWRILOW. Yes, thank you. I would just like to kind of echo 

what Evelyn was saying, but I also think—I agree that aligning the 

transition plans that youth have when they are aging out of foster 

care, they are supposed to have a transition plan for 90 days prior 

to when they leave care, and this would align that, the resources 

with the plans that they have, and make sure that the voucher can 

be built into the plan so they are not having a lapse in housing. 

The other thing that I think is really important is the guidance 

between HUD and HHS and having them work together to help 

housing authorities work with their local child welfare agencies to 

improve referral processes, to improve access to supportive services 

for the young adults who are receiving these vouchers. 

So I do think the changes contemplated are really important, and 

I think that they will provide that housing stability and right away 

as opposed to what Evelyn was saying is when young adults fall 

into homelessness after leaving care and then they come back into 

stable housing situations. 

Mr. CLEAVER. Thank you. I yield back, Mr. Chairman. 

Chairman LUETKEMEYER. I thank the gentleman. We are looking 

to put that in the bill. We thank you for that suggestion, and we 

also are looking to add the—my sharp staff who keep talking in 

both ears at the same time, so unfortunately, I can only hear out 

of one at a time, but we are looking to do that as well. So we thank 

you for those suggestions, and keep them coming. 

With that, we go to the gentleman from Texas, Mr. Williams, for 

5 minutes. 

Mr. WILLIAMS. Thank you, Mr. Chairman, and also thank you to 

the witnesses today for being here. I appreciate seeing you. The 

Section 8 housing voucher concept can be one of the most successful public/private initiatives, but as with many other government 

programs, it has started to sag under the weight of too many burdensome and duplicative requirements. The Housing Modernization 

Act will make important changes that will improve the program for 

all stakeholders. 

My question will be to you, Mr. Merritt, what do you think are 

the most critical problems facing the assistive housing portfolio and 

how will the proposed legislation make improvements? 

Mr. MERRITT. Thank you. I just want to speak to that. This is 

a great bill for us, and it is a start to fix some of those problems 

that you bring up, Mr. Congressman. A couple of things: increasing 

the percentage of the limitation on the voucher program for projectbased vouching will be critically important to us to help populations who are underserved now, such as persons with intellectual 

disabilities, which I have done a project in my hometown on. 

8 

There is a whole population out there of young people aging up 

over 22 who are in need of housing with supportive services, and 

the project-based voucher extension would allow us to serve more 

of those individuals who will need help for a long time. It also, the 

idea of triannual rent redeterminations will take away some of the 

administrative burden that we would have having to renew rents 

every year for people who are on fixed incomes. The rent doesn’t 

change. We are doing recertifications for rent that might change $2 

or $3 either way, and that is really a waste of a lot of time and 

effort that could be used for other more productive issues. 

The other is the fair market rent issue is becoming a problem, 

and by allowing us to raise the percentage of fair market rent that 

we are able to up to 120 percent would be very important, particularly in high-income areas, high-rental areas like where I am in the 

Boston area. 

Mr. WILLIAMS. Thank you. 

Mr. Kelly, steps have already been taken to eliminate duplicative 

inspections through the budget process for assisted housing funded 

with multiple subsidies, and H.R. 3700 further streamlines the effort by permitting immediate tenant occupancy if the unit has been 

inspected under the Federal housing program with the same stringent standards. 

Would you help us understand the financing challenges associated with affordable housing, and does this mean that in order for 

affordable housing to exist and/or be developed, an owner must find 

multiple sources of capital to develop these properties? 

Mr. KELLY. Thank you, Congressman. I am representing the National Association of Home Builders, but I am a builder/developer, 

I own and operate some 5,000-plus units of affordable housing, and 

I have developed over 11,000 units. Securing financing for affordable housing is an extraordinary challenge and becoming more so 

each and every day. I use both Section 8 project-based assistance. 

The vouchers are critically important in the development of new 

properties, primarily the low income housing tax credit where State 

housing finance agencies, their communities decide to target lowerincome families below 50 percent of median income, so those vouchers make it critically important in order to secure the financing. 

Those transactions also have a multiple number of financing 

sources besides the debt, the tax credits, often funds from the Federal Home Loan Banks, or home funding, but again, often, if the 

targeting is such to very-low-income families, the vouchers are 

critically important in order to make the transaction feasible. 

Mr. WILLIAMS. Thank you. Mr. Chairman, I yield back my time. 

Chairman LUETKEMEYER. The gentleman yields back his time. 

With that, we go to the gentleman from Texas, Mr. Green, for 5 

minutes. 

Mr. GREEN. Thank you, Mr. Chairman, and may I please take a 

moment of my time to thank you and the ranking member for 

working together on this piece of legislation. I think it is exceedingly important, Mr. Chairman, and it has bipartisan support. 

This is one of those times when I think we can say that we are 

working together for the good of our country, and I appreciate you 

very much. And I thank you, also, Mr. Ranking Member. You have 

9 

been a real friend to those who are in need of housing in this country, and I appreciate both of you. 

Mr. Chairman, if I may say this, I also would like to speak on 

behalf of 420 Members of Congress. That is the number who voted 

for the Homes for Heros Act in the 113th Congress, and I am proud 

that you have made Section 403 of this legislation, you have dedicated it to the Homes for Heroes legislation. The Homes for Heroes 

legislation would place a person in HUD whose job it is to look out 

for veterans. This person would help us to prevent persons from becoming homeless, veterans and their families, and also to provide 

some relief for those who may be homeless. 

We believe that those who are willing to risk their lives for this 

country merit the very best that we can offer, and I think that we 

can do more. I think this legislation will help us to help our veterans who are in poverty, homeless, and those who may be falling 

into poverty and homelessness. 

I would also mention to you, Mr. Chairman, that I am concerned 

about people who are waiting in line for housing. Most of the housing authorities across this country have persons who are standing 

in very long lines to get help, and as you know, we have, as of late, 

seen news stories about persons who are over income and still receiving a housing subsidy, as it were. 

Perhaps they are paying the max that they can be required to 

pay, 80 percent of the AMI, but they are still over income. Some 

of them are over income by a wide margin. My concern is this: We 

have people who are standing in line who need this housing. Many 

have been in line for years literally, not figuratively, for years, and 

we have persons who are over income who are in public housing. 

The public perception is that as you move up, you move out. You 

move up, your income is better, and you move out. I am appreciative that you are attempting to address this issue in this piece 

of legislation. 

We cannot allow the perception to be that this benefit is for the 

greedy as well as the needy. It is not for the greedy. It is for needy 

people. And those who are standing in line are of concern to me. 

I want to make sure that they have the opportunity to benefit from 

good decent housing just as the people who are there currently are. 

And there is much more that we can do. I am not a person who 

believes that we have done all we can do, but I am a person who 

believes that we have to give some thought to those who are in 

line, those who need this housing. 

So I am appreciative that the legislation addresses this. There 

may be some tweaking to it. I am amenable to working with you, 

Mr. Chairman, and Mr. Ranking Member, but this is something 

that I think is of paramount importance. And finally, if I may say 

this as I close, across the length and breadth of our country, there 

are people who are working hard to help those who are homeless. 

People do a good job every day, and now I am talking about the 

housing authorities. 

I find that too often they take heat for things that they are trying their best to do properly and to do correctly, and I just want 

to say to them, please, continue to do the good work that you are 

doing. The criticism that you get is something that sort of comes 

with the job, but there are just so many who are doing a good job, 

10 

public servants all, working hard for the persons who are in need 

of housing. 

With that said, Mr. Chairman, I thank you again, and I will 

yield back the balance of my time. 

Chairman LUETKEMEYER. The gentleman yields back the balance 

of his time. Next, the gentleman from New Mexico, Mr. Pearce, is 

recognized for 5 minutes. 

Mr. PEARCE. Thank you, Mr. Chairman. I find myself agreeing 

with Democrats frequently on many things, but now I am in the 

awkward position of finding myself agreeing with a Texan on some 

things, so I would agree with the gentleman as he said thanks to 

our ranking member and to our chairman for the work that they 

have done. 

We began this sort of reform work, I guess you would call it, with 

Native American housing about 3 years ago. One of the things that 

we found is that the reforms were fought by HUD more than anybody else. Is that something that you would sort of ring true, and 

just do a head shake because I have a couple of more questions. 

Head shakes up and down, or no, yes, no, yes. So yes, the agency 

is resistant to anything that makes the system work better, and we 

are not going to overcome that unless you all start calling your 

Members of Congress to go in and sit with them. 

Through lengthy processes, HUD actually began to see what we 

are doing, as not a threat, but as a benefit, but I suspect we are 

going to have to do the same thing here. And so as you bump up 

against those physical stops, those emotional stops inside the agency, just consider it worthwhile to get one of us to sit down, you 

come in, and I think anybody on either side of the aisle, anybody 

on the committee would be happy to sit and reason through with 

HUD the reasons for doing these. 

So again, I appreciate all your passions here working in your 

particular areas. My question for Mr. Kelly has to do with rural 

housing. Obviously, New Mexico is a very rural State; 50 percent 

of the housing in my district is in manufactured housing, so we are 

always struggling to improve the lot. What are the biggest challenges that are being faced for rural housing right now? Your testimony has things about that, so— 

Mr. KELLY. Thank you, Congressman. I am a developer and 

owner of 515 rural housing developments. I own approximately 18 

developments. I have acquired those under the RD demonstration 

program. This bill talks about making that permanent. I think that 

would be an extraordinary positive step forward. 

It is an enormous challenge. There is an inventory of housing out 

there that the country and private owners have invested in that 

has the ability to be preserved and maintained for decades to come 

with utilizing the right programs. It is a challenge. The incomes in 

rural areas are often depressed, but nonetheless, there is, I think, 

that program has demonstrated that it can be done and it certainly 

should be done to meet those crying needs because you rarely find 

the private lending institutions, or for that matter, FHA providing 

assistance in those areas. 

Mr. PEARCE. Does the 515 need to be expanded or can the agency 

do that by itself? Does this legislation need expansion or— 

11 

Mr. KELLY. I believe the program should be expanded because of 

the size of the portfolio. 

Mr. PEARCE. Can it be done by the agency or does it need to be 

done in legislation, in your opinion? You have much more experience than most on us on the committee. 

Mr. KELLY. I would say probably legislatively. 

Mr. PEARCE. Okay. Ms. Craig, the—you have a passion there for 

helping people who need help, and then you have heard again the 

gentleman from Texas talk about moving up, moving out. How big 

a problem is this prioritization of need? In other words, do people 

languish in the housing who should be out and on their own? 

Ms. CRAIG. I can’t speak to it in general overall in terms of individuals who are in housing authorities, but I certainly will say that 

I think anything that clarifies and simplifies and provides more options for getting people off the waiting list to—housing authorities 

have preferences, but because there is such a backlog, that ends up 

not having an impact on the waiting list, which is frustrating to 

everybody. 

And when we went through sequestration, we were finding that 

in Kansas City, an 8-year-old child previously might be waiting 4 

years to get into public housing, and with sequestration, that same 

kid might be waiting 12 years until he would have his own family— 

Mr. PEARCE. I have a couple more. I only have 23 seconds. 

Ms. CRAIG. Sorry. 

Mr. PEARCE. Ms. Gawrilow, would you happen to have an opinion, or Ms. Burns, either one of you all have an opinion about this 

moving up and moving out, how bad is the problem, how much 

could we improve it? 

Ms. GAWRILOW. Yes. One thing that I think could help people 

who are in assisted housing or families and households who are in 

assisted housing is looking at the Family Self-Sufficiency Program, 

which is an asset building and financial capacity program that resides in HUD, and PHAs administer this program, and to better 

connect families to that program and families who are maybe higher in need. So maybe connecting the HUD–VASH recipients with 

it. You can connect families who are receiving the FUP voucher, in 

particular youth who are receiving the FUP voucher. This may be 

a great tool to help them as an additional service to increase their 

access to programs and services to lead to independence later on. 

Mr. PEARCE. Thank you, Mr. Chairman. I yield back. 

Chairman LUETKEMEYER. The gentleman yields back. Next in 

line, the gentleman from Minnesota, Mr. Ellison, is recognized for 

5 minutes. 

Mr. ELLISON. I would like to thank the chairman and the ranking member for putting together this bill to improve how we provide affordable housing, affordable rental housing to extremely-lowincome families, to help home buyers purchase a condo. This is 

great. I appreciate it. The goal of today’s hearing is to examine how 

the Federal Government can better provide housing assistance in 

the 21st Century. In light of the fact that incomes remain too low 

for many workers to afford market rate housing, we need to invest 

more Federal funds to address the rental housing crisis. 

12 

While I support many provisions in the bill considered today, the 

real answer is to—I am, in my opinion, quadruple our investments 

in rental housing for extremely-low-income families. I have asked 

for Chart 1 to be shown on screen. 

Mr. Fischer, this chart is from the Center for Budget and Policy 

Priorities. Can you explain what it says about our rental housing 

crisis? 

Mr. FISCHER. Sure. And I will say first, I think it is really important to move forward with the targeted changes in this bill, which 

I think are well-designed and would deliver real benefits to low-income people, but it is true that the challenges go well beyond what 

this bill can address. 

This chart shows—the blue line there is the number of families 

with what HUD calls worst-case housing needs, which means they 

are very low-income families who pay more than half of their income for housing or live in severely substandard housing, and that 

has gone way up. It is up more than 30 percent since before the 

recession. 

The red line is the number of families with rental assistance, 

which has pretty much been stagnant, so this shows that the number of families struggling to afford housing has gone way up, but 

the programs that are best positioned to address that need have 

very much been treading water. 

Mr. ELLISON. Thanks a lot. I would like to point out that nationwide, we have more than 1.3 million homeless children. In my own 

district, in the City of Minneapolis, which is a pretty well-to-do 

town, we have about 4,000 kids every day going to school from a 

shelter. 

Anyway, Mr. Fischer, let me show you Chart 2. We spend more than $270 billion a year on housing, $270 billion in housing in 

America. But this chart shows that the bulk of the investment, 

well, it is for better-off families. Can you explain the financial benefits families receive and who receives the most generous housing 

assistance? Because some people would have us believe that it is 

the very poor who get all the housing assistance. Is that correct? 

Mr. FISCHER. When you include tax expenditures along with direct rental subsidies, the bulk, close to three-quarters of Federal 

housing expenditures go towards homeownership, and the biggest 

share of that is for deductions like the property tax deduction, and 

especially the mortgage interest deduction that go predominantly 

to higher-income families, and that is what this chart here shows. 

About three-quarters of the benefits from those deductions go to 

families with incomes above $100,000 and more than a third go to 

families with incomes above $200,000. 

Mr. ELLISON. Okay. So yes, so this is three, and when we think 

of who receives housing benefits, we don’t realize that high-income 

families receive 4 times more housing benefits than do low-income 

families. What should we do to right-size housing assistance, and 

I know you are familiar with my bill, the Common Sense Housing 

Investment Act, I would welcome your reflections on it, and your 

reflections on this chart. 

Mr. FISCHER. I think what this chart shows is that it is cause 

for concern. Low-income people are much more likely than higherincome people to deal with problems like eviction and homelessVerDate Nov 24 2008 15:17 Sep 16, 2016 Jkt 099754 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 K:\DOCS\99754.TXT TERI
13 

ness, which are bad for everyone but especially bad for children, as 

you mentioned. And part of what drives that is that Federal housing resources are targeted heavily on higher-income families who 

could afford housing without help. 

I think that the issues that your bill raises, like looking at reforms to the mortgage interest deduction that would keep a large 

mortgage interest benefit in place but reducing it some for higherincome households and expand it for middle-income folks and generate some savings that could be used for other things, I think, is 

a sensible approach. 

Mr. ELLISON. Thanks a lot. 

It looks like I am running out of time. Let me see if I can ask 

Mr. Polychron a question. Mr. Polychron, thank you for being here 

today. Allow me to ask you about marketing services agreements 

and control business arrangements. I read the REALTOR’S® recent report, ‘‘Definitive Analysis of Negative Game Changers 

Emerging in Real Estate.’’ It is called the ‘‘Danger Report.’’ It 

warns that many REALTORS® are most likely in violation of 

TILA–RESPA rules regarding illegal kickbacks. When the title insurance agency is referred business through an affiliated business 

arrangement, where does the cost of the referral get absorbed? Who 

pays for it? 

Mr. POLYCHRON. The Danger Report, as you may—and thank 

you for the question, sir, but the Danger Report was something for 

us to look forward that might happen. It isn’t something that is actually happening. It is something that we are trying to prevent 

from happening. And marketing service agreements are certainly 

something that not only the DOJ looks at a lot but we have to be 

careful on how those are initiated. I can tell you that our association is constantly monitoring that to make sure that when we do 

any type of marketing service, that it is done properly. 

Mr. ELLISON. Thank you, and I yield back the time that I don’t 

have. 

Chairman LUETKEMEYER. The gentleman is correct. His time has 

expired. With that, we go to the gentleman from Pennsylvania, Mr. 

Rothfus. He is recognized for 5 minutes. 

Mr. ROTHFUS. Thank you, Mr. Chairman. And I thank the panel 

for being with us this afternoon. I will address this first question 

to Mr. Kelly. 

In your written testimony, you note that it currently costs an 

apartment owner more to rent to a voucher holder than it does to 

rent to an unsubsidized resident. One of the reasons for this cost 

discrepancy is the program’s burdensome and often duplicative inspections standards. 

Can you discuss some of the disincentives for renting to voucher 

holders? 

Mr. KELLY. Sure. The inspection process itself is one, certainly, 

sir. The uncertainty for a landowner or an apartment owner, when 

a prospective tenant approaches him with a certificate, or a voucher, and explains that their property has to be inspected by a public 

housing agency, they have to wait for that. The owner can’t enter 

into the agreement at that point in time. It is subject to the inspection process. 

14 

And, as I think has been indicated in some of the written testimony, those inspections can fail for such innocuous things as a torn 

screen. And those are the kinds of things that you don’t keep secret 

in the private rental market. Owners know about it. They talk 

about it. So that is an example of the kinds of disincentives that 

are out there in the current administration of the program that dissuade private property owners from participating in the program. 

Mr. ROTHFUS. By consolidating inspection standards, is there any 

risk for increased fraud and abuse which would potentially place 

residents in unsafe housing? 

Mr. KELLY. I assume there may be, but I think, quite frankly, 

there is an expeditious process to follow up on the heels of that tenant being approved to live in that residence, and with an owner understanding that if in fact he has defrauded somebody, that will be 

caught relatively quickly, so I think it is extremely de minimis. 

Mr. ROTHFUS. Mr. Merritt, my district is home to many seniors 

living on fixed incomes, and some of these individuals receive housing assistance. As you know, H.R. 3700 permits income recertification for people living on fixed incomes every 3 years as opposed 

to yearly. 

Clearly, this reform reduces burdens on residents by avoiding 

what can be a stressful and difficult yearly process. Can you comment on how this might impact housing providers and administrators? 

Mr. MERRITT. I’m sorry, how it will protect, sir? 

Mr. ROTHFUS. How the moving from every 3 years on income certification to—I’m sorry, annual to every 3 years, can you comment 

on how this might impact housing providers and administrators? 

Mr. MERRITT. Thank you for the question. The impact would be 

pretty immediate as to the decline—lower the workload for individuals and offices around the country. The caseload would go down, 

which would allow us to spend some time on other things that we 

have had to take time away from. 

And I would agree with you that the process of rent certification 

can be very stressful, particularly for seniors on an annual basis. 

I would also say they are also some of the most prepared when 

they do come into our office and it can be very easy, so the timeframe to do a residence, a senior residence rent calculation can 

take anywhere from 5 to 10 minutes to an hour-and-a-half, depending on what their capabilities are and the medical deductions that 

are allowed and things. 

So, it is a burdensome administrative activity that would be reduced to every 3 years, and it wouldn’t be—I would assume not 

every resident would come in on the same year. We would stagger 

it so it would reduce the monthly workload which frees up time 

that is actually not there anymore. 

Mr. ROTHFUS. Thank you. And I am wondering if maybe any 

panelists would want to comment on this: Section 109 of H.R. 3700 

creates flexibility of capital and operating fund amounts by allowing housing authorities in good standing to blend up to 20 percent 

of their federally appropriated capital and operating funds. Does 

this create an incentive for public housing authorities to modernize 

their systems and operations so they can have greater flexibility 

and control moving forward? 

15 

Mr. MERRITT. I will answer that. Absolutely, affirmatively yes, it 

would help us to incentivize improving our systems. It allows us to 

have flexibility to spend that money either on a property issue that 

we are dealing with and may be short-funded, or administratively 

in helping our offices maintain computer systems and things like 

that which come up every so often. 

So that would go both ways, that fungibility. It is an important 

tool to help complete capital projects that may need that little bit 

of extra cash that isn’t available through the capital programs. 

Mr. ROTHFUS. I thank the chairman. I yield back. 

Chairman LUETKEMEYER. The gentleman’s time has expired. 

Next up is another gentleman from Missouri, the distinguished Mr. 

Clay. He is recognized for 5 minutes. 

Mr. CLAY. Thank you, Mr. Chairman, and thank you, Mr. 

Cleaver also for conducting this hearing. 

Let me ask Mr. Polychron about HUD’s 223f program. There has 

been a precipitous drop in the program, and it is because HUD 

changed the underwriting requirements 2 years ago. What has 

been the impact of HUD’s underwriting changes to its multi-family 

program? 

Mr. POLYCHRON. Congressman, with your permission, I am going 

to defer that to Ms. Burns. I don’t do rentals. I am being honest 

with you. 

Mr. CLAY. I see. 

Mr. POLYCHRON. It is you either do rentals when you are a REALTOR® or you don’t, and I am going to defer to Ms. Burns, with 

your permission. 

Mr. CLAY. Ms. Burns, could you— 

Ms. BURNS. Sure. 

Mr. CLAY. —talk to me about what has been the impact on the 

program? 

Ms. BURNS. It is hard to know specifically what could cause that 

drop, but we do know how complicated it is to put together a transaction and to make all the pieces work in an affordable housing 

transaction. 

Every piece of the underwriting matters, and what we understand is that the movement to a longer-term view of replacement 

reserve needs has created a more difficult program to underwrite, 

and our understanding is that the change could be made back to 

a 10- or even a 12-year replacement reserve window, and that 

would make it more affordable for the developer to put that property together and to be successful in that transaction. 

Mr. CLAY. So it is really then—the rule change has dampened 

the ability to develop those properties. 

Ms. BURNS. It requires a much larger investment on the front 

end, which means that you don’t have enough money to afford to 

do something else that may be more important. 

Mr. CLAY. Thank you for that response. 

Let me go to Mr. Kelly with the Home Builders. Are you familiar 

with the 223f program? 

Mr. KELLY. I am, sir, and I have done a number of developments 

utilizing the program. But as Ms. Burns said—and I have done 

them typically in conjunction with repositioning a property, utilizing also the low income housing tax credits. 

16 

The challenge we face is when that kind—those reserves are required up front, additional capital reserves up front, it simply 

leaves often inadequate resources to rehabilitate the project to 

meet not only sort of my standards, because I know I am going to 

be holding on to it for a long time, the investor standards, and also, 

in many instances, to meet local code requirements that continue 

to raise the cost of housing, while well-intended, often outstrip the 

ability of particularly of affordable housing developments to meet 

and, therefore, render the development infeasible. 

Mr. CLAY. Mr. Kelly, in the best of all worlds, what would be a 

reasonable modification of this rule? If you had it your way and 

could go into HUD and direct them to change this rule, what would 

be a reasonable modification of the rule? 

Mr. KELLY. Again, a reasonable amount of reserve for replacement up-front, but also earned, over time, as was traditionally 

done. Put it into the reserves over time, because it is that large, 

up front cash investment that renders the project infeasible. 

Obviously, every project is slightly different, and depending on 

its physical condition, its market, that amount may vary, but there 

ought to be greater flexibility, depending on the particular circumstances, and that doesn’t exist at the moment. 

Mr. CLAY. And it has really dampened the ability to provide affordable housing to larger amounts of the population. Is that right? 

Mr. KELLY. It does, sir. 

Mr. CLAY. Thank you so much for your responses. 

Mr. Chairman, I have no other inquiries, so I yield back. 

Chairman LUETKEMEYER. The gentleman yields back. Next, we 

go to the gentleman from Kentucky, Mr. Barr, who is recognized 

for 5 minutes. 

Mr. BARR. Thank you, Mr. Chairman, and thanks for your leadership in introducing H.R. 3700. 

And to our witnesses, I want to first address the issue of continuum-of-care grants in combatting homelessness, and I think I 

will direct my question to Ms. Bradley-Geary and Ms. Craig on this 

one and anybody else who might want to jump in on this. 

As I understand it, the continuum-of-care program provides that 

if a grant is not fully expended in 24 months, the money is recaptured by HUD unless the Secretary re-allocates it to another entity 

serving in the same geographic area. 

We have had a problem with this in Kentucky, my home State 

of Kentucky, where two metropolitan areas, Lexington in my congressional district, and Louisville, are receiving continuum-of-care 

dollars, but in Lexington in my congressional district, that money 

goes out the door pretty quickly and we exhaust that funding, but 

we have had a situation where Louisville has had a surplus of 

funds, and instead of allowing a reallocation of those dollars to Lexington, which has a significant homelessness need, the Department 

recaptures that. 

H.R. 3700 does attempt to address that issue, fortunately, by 

clarifying geographic area, and my question to you all is, do you 

think facilitating the convertibility of unspent funds, unspent grant 

monies between qualifying grantees would increase access to fighting homelessness? 

17 

Ms. BRADLEY-GEARY. I can address that, and yes, I do. The short 

answer is yes. I think as long as we leave that up to the continuum 

of care in the areas that you are serving. So the continuum of care, 

right, is the plan to end homelessness, and those are your boots on 

the ground in those communities, and so as long as there is input 

from that community about how those funds should be spent, yes, 

I think that would be in the best interest of the people we are serving. 

Mr. BARR. Our State office has said that even though you have 

unspent funds in one city, one hour away from another city in 

need, that Washington HUD wouldn’t allow for the convertibility, 

and it just seems like a little bit of bureaucracy getting in the way 

of delivering the dollars where they need to go, so I appreciate your 

thoughts on that. 

To Mr. Merritt, I want to talk about Moving to Work. The Lexington housing authority, my district, is a Moving to Work jurisdiction, and it has been very successful in terms of the fungibility of 

dollars, but I want to address work requirements and time limits. 

My colleague and friend from Texas, Mr. Green, on the other side 

of the aisle, talked about the need for us to focus on these waiting 

lists, and I couldn’t agree more. 

We need to not only focus on the beneficiaries of Section 8 vouchers and trying to help them achieve self-sufficiency, but the many 

people who are waiting in line, and this is an over-subscribed program, these Section 8 vouchers. I would want to see Section 8 modernized to the point where we could encourage work, encourage 

self-sufficiency, so that those who are deserving and waiting in line 

can get their opportunity at Section 8 housing. 

So my question to you is, the President has proposed—in the 

past, President Obama has proposed expanding Move to Work. 

Move to Work has worked in my congressional district, that flexibility to encourage work requirements and time limits. My question 

to you is, do you think it would be a good idea to maybe apply time 

limits and work requirements to Section 8 nationwide? 

Mr. MERRITT. I think the Moving to Work program is a great 

program for public housing authorities, and I know the director in 

your home district office, Mr. Simms, has done a great job at his 

authority. To apply it nationwide is a little bit dangerous because 

the Moving to Work program allows the local housing authority to 

deal with those issues locally, and that is what is really more important, and it needs to be addressed and is a valuable tool, but 

it needs to be done on the local level because what may work in 

Kentucky may not work in Massachusetts. 

Mr. BARR. If I can just jump in, I agree with you, and Austin has 

done a great job, and I agree with that local flexibility, but generally speaking, I think what we did in 1996 in this country with 

welfare reform is we recognized that work is a blessing. Work is 

not a punishment. Work is a blessing. Work is an opportunity for 

people to achieve self-esteem and a sense of value, and I think that 

it is not a local issue. I think it is a universal issue, work, work 

providing able-bodied people who receive taxpayer benefits in the 

form of a Section 8 voucher, to encourage work as an incentive of 

receiving this benefit is a way to get people the help that they need 

and then out of the system, and then open up those vacancies to 

18 

all those people who are in waiting lines, and again, achieve that 

self-sufficiency. 

Mr. MERRITT. I agree with you, and the Family Self-Sufficiency 

Program is one that we run in my office as well, and it has helped 

many people on that track to work through educational opportunities. We had several young women become nurses or licensed practical nurses and be able to move off the program, and at the same 

time that they—even before they move off, the subsidy level for 

that voucher goes down because they are working more, they are 

paying more. So it is a valuable tool and there should be a way to 

incentivize that and help that system along. But the Family SelfSufficiency Program is working out there in many jurisdictions. It 

is working very well. 

Mr. BARR. Thank you. My time has expired. I yield back. 

Chairman LUETKEMEYER. The gentleman’s time has expired. 

Next we have the gentlelady from Ohio, Ms. Beatty, who is recognized for 5 minutes. 

Mrs. BEATTY. Thank you, Mr. Chairman, and Mr. Ranking Member, and thank you to all of the witnesses here today. 

First, let me start, Mr. Chairman, by echoing what some of my 

colleagues have already said, but I think, because of the tone of today’s hearing, it is worth repeating, that it is a good day and a 

good feeling when we can have a bill that we can find so much good 

and bipartisan in and meet the standards of why we are here in 

creating housing opportunities. 

As someone who has spent a lot of time working in the housing 

areas, working with public housing, I commend all of you for the 

roles that you play in helping to create and sustain these opportunities that gets us to that self-sufficiency. 

With that, before I go to my questions, let me also say what we 

are doing for those young foster care individuals. Recently, I had 

a number of them who appeared to be somewhat atypical who 

ended up in my office. They were all college students who had been 

homeless but found a way through some advocacy group or individual to get all their paperwork done and get into college. Well, 

at the first face value, you think, how wonderful. Here is a person 

who is going to college and great, and as the one gentleman looked 

at me and said everything is fine for the first 45 days of school, 

and then we read the notice that said people are going home for 

the holiday, and I didn’t have a home to go to. 

And that just hit me right in the face, that I am thinking, here 

you are at one of the largest institutions in the country and you 

are matriculating and doing well. He said, but I ran out of couch 

surfing, and that was the first time I had heard that term, and so 

he said I am asking you as an advocate and a member of this committee to make sure that any opportunities you get, to help us have 

some of the same privileges that we do for veterans or pregnant 

teenagers because we are the future and we are doing well. So I 

thank everybody here for pushing with that. 

With that said, since I am on a roll, I should also say to you, Mr. 

Chairman, that I think that this bill contains a lot of stuff that I 

like and that I would be willing to put my signature on, so I want 

us to note that today. But also, earlier this month I joined 51 of 

my colleagues in sending a bipartisan letter to HUD Secretary CasVerDate Nov 24 2008 15:17 Sep 16, 2016 Jkt 099754 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 K:\DOCS\99754.TXT TERI
19 

tro asking for changes to the process of financing condominiums 

and to ease other requirements like owner occupancy and delinquent condo association dues because I have heard from a lot of my 

stakeholders that such requirements and restrictions have made 

the FHA certification process daunting at times and especially for 

some of the smaller properties and those that don’t have the elite 

management, contracts, or people to operate them. 

I think I read somewhere last week that the Federal Housing 

Administration is expected to issue rules by the end of the year 

that could make it easier for lenders to finance loans for condominiums, sales with government backing. So, Mr. Polychron, you stated in your testimony that FHA has a number of significant restrictions that prohibit many buyers from purchasing a condo despite 

the fact that condominiums often represent the most affordable options for first-time home buyers. This is important to me because 

I am seeing so many people in my district in condos. 

Mr. POLYCHRON. Yes, Congresswoman, and thank you for the opportunity to speak on a subject that I do know something about. 

Mrs. BEATTY. I thought you would like that question. 

Mr. POLYCHRON. Seriously, I live in the small community of Hot 

Springs, Arkansas, and it says that we have, in the whole State of 

Arkansas, 54 condominium developments certified. I know in my 

own hometown, we have homeowners associations, or POAs, in excess of that number, but because of the certification process, which 

is 95 pages long and sometimes not only burdensome to finish or 

daunting, as you said, but expensive to hire—to get a certified financial statement done by a CPA, for instance, the 35 percent rule, 

and thank you, Mr. Chairman, for putting that in H.R. 3700, the 

35 percent rule is a great start. We would like to see it at zero as 

far as occupancy. The last time we asked for a reduction, the HUD 

reduced it—or FHA from 51 to 50 percent. We hope we do better 

this time with your 35 percent suggestion. 

Condominiums are the lowest of the seriously delinquent rates of 

any of the FHA-insured mortgages. They are 4.9 percent. The average is 6.96 percent, so we certainly think that they deserve merit 

in relaxing the requirements for condominium financing. 

Mrs. BEATTY. Thank you. Thank you, Mr. Chairman. 

Chairman LUETKEMEYER. I thank the gentlelady. With that, we 

go to the gentleman from Florida, Mr. Ross. He is recognized for 

5 minutes. 

Mr. ROSS. Thank you, Mr. Chairman, and I wish to add my name 

to the list of those who have thanked you and the ranking member 

for bringing this bill forward. I particularly like certain incentives 

in there, the incentive to give charitable organizations and nonprofits opportunities to invest in energy and water conservation 

and the remodification and building of housing. I think that is 

very, very important. 

I particularly like what my colleague from Kentucky, Mr. Barr, 

discussed with the Move to Work programs. Those are great incentives. I think it is important that a lot of this is temporary, but it 

has become multi-generational and we need to do all we can to 

make sure that we provide incentives, not only for good housing 

but also for the opportunities to gain dignity through work. 

20 

Section 103 of this particular bill is of interest to me, and it has 

to do more with the modified means testing in terms of those who 

stay in the homes and whether they are overqualified financially 

to be in there. For example, my colleague from Florida, Representative Jolly and I have been focused on reducing waste and fraud 

within HUD and to ensure those who rightfully are in need of assistance are able to receive it. 

A recent HUD independent inspector general’s report revealed 

that over 25,000 families currently in taxpayer-supported housing 

exceeded the maximum allowable income threshold to qualify for 

federally-subsidized housing. In one instance, a New York family 

with an income of nearly $500,000 is paying $1,574 a month to live 

in taxpayer-subsidized public housing. 

In another unfathomable incident, a family had personal assets 

of over $1 million while living off the backs of taxpayers. With an 

ever-growing waiting list for housing assistance for those truly in 

need, these incidences of waste, fraud, and abuse should be eliminated. Therefore, my first question is to Ms. Burns. What is your 

perspective regarding tenants who remain in public housing but 

have the financial means to afford nonsubsidized housing, thus 

opening up an opportunity for those who should be in line for that 

type of assistance? 

Ms. BURNS. My expertise is in privately owned housing, not public housing, but I can respond this way. I think it is incredibly important to catch fraud and abuse. Just this morning, the National 

Leased Housing Association, myself and our executive director 

were meeting with HUD to talk about the EIV program. 

Mr. ROSS. Right. 

Ms. BURNS. And the way that program is working, we believe 

strongly that it is essential to catch fraud and to put teeth in when 

we catch residents who have misled us on their income and 

miscertified, that there be teeth rather than just a slap on the 

wrist and say please pay us back when you can. 

Mr. ROSS. So would you support Section 103, that after 2 years, 

if their income is in excess of 120 percent of area median income, 

to charge the tenant the fair market value for the housing? 

Ms. BURNS. It seems to make sense to me. As I said, I am not 

a public housing person. 

Mr. ROSS. I agree with you. Moving on. I have a good friend of 

mine from Florida who now lives in Atlanta, Georgia, who is head 

of a nonprofit organization called IMPACT! I don’t know if any of 

you all have heard of that, but the IMPACT! Group provides housing for homeless veterans, amongst others, but they have a tremendous program that incentivizes the private sector to invest, and 

then they will assist not only in temporary housing but finding employment, taking part of their wages to invest in a deposit that 

eventually they move on to work. 

The company is in Gwinnett County, Georgia, and they are 

searching for more ways for private sector participation rather 

than depending on the Federal Government. And I will tell you, I 

think what has happened over the last few years in housing, being 

able to leverage private investment to create greater housing with 

certain guarantees of Section 8 housings and other vouchers has 

21 

been a great program in order to manage and maximize the 

amount of housing we have out there. 

Since it was established in 1992, the IMPACT! Group has grown 

over—such that over 90 percent of the families who graduate their 

program remain independent of assistance a year later. My question, Mr. Merritt, to you and to anyone else is that given our type, 

that Federal budget environment, let’s face it, we have competing 

interest for Federal dollars, how can local and State housing agencies leverage their assets better and find other financial tools to 

incentivize the private sector to invest in these types of programs? 

Mr. MERRITT. Being an administrator of a public housing agency, 

we look at that sort of through the eyes of the HUD regulations 

and other rental assistance demonstration or something that is 

under way and is a way to bring in private money into the public 

housing system, but it also needs the public investment as well because it has been invested in for a long time and there is investment there that needs to be protected, so the capital fund program 

to keep things in repair is important to local public housing agencies. 

Mr. ROSS. And furthering tax incentives for the private sector to 

invest should be good as well, shouldn’t it? 

Mr. MERRITT. It should. Through the low income housing tax 

credit system is also very important. 

Mr. ROSS. Thank you. And I yield back. 

Chairman LUETKEMEYER. The gentleman yields back. With that, 

we go to the gentleman from Delaware, Mr. Carney. He is not a 

member of the committee, but he has a lot of great questions today 

and we look forward to his insights and the information he is going 

to glean for us. 

Mr. Carney, you are recognized for 5 minutes. 

Mr. CARNEY. Thank you, Mr. Chairman, and Ranking Member 

Cleaver. And Mr. Chairman, thank you for your kind remarks. 

Actually, I am here mainly to welcome to the Capitol one of my 

constituents, Kevin Kelly. Kevin and I have worked together over 

the years. He is a Delawarean, and he is the chairman of the 

NAHB and a real leader nationally. But he has been developing 

and working on housing projects for a long, long time. And a Delaware protege of one of the giants of affordable housing in our country, Leon Weiner. Welcome, Kevin. It is great to have you and your 

expertise here. 

But since I have a couple of minutes, I might ask a few questions. I had to pinch myself for a minute because there was so 

much agreement across the aisle here. I guess it is not surprising, 

frankly, given who the chairman and the ranking member of this 

subcommittee are, two people who are always looking to work together; and the comity that you bring to this committee is extraordinary. 

There has been a lot of discussion. What is interesting is we have 

common problems among our districts; and they all, many center 

around the lack of adequate resources and the scarce resources, 

and I wonder if, to start with you, Mr. Kelly, if you could tell us 

how we could more efficiently use Federal resources that are available? And I will ask Mr. Fischer and Mr. Merritt that question as 

well. 

22 

Mr. KELLY. Thank you, Mr. Carney, for the kind words, and it 

has been a pleasure working with you over the years. I certainly 

applaud the initiative of the committee in this particular bill. We 

are competing in a world of very scarce resources. 

I think what H.R. 3700 does, is look at substance and results 

over process. Too many of our programs are burdened by process 

and not results. And I think this bill attempts to address many of 

those issues. 

Mr. CARNEY. I know there is some controversy over the Moving 

to Work Program, but it is and folks have indicated it works differently in different places. It has worked well in Delaware. It is 

not the be-all and end-all, but it seems to me it ought to be a piece 

to the point, Mr. Kelly, you are mentioning in terms of effectiveness. 

Mr. KELLY. I would agree. In looking at my privately owned Section 8 family portfolio, we run somewhere between 70 and 75 percent of the families in our developments are working at any one 

time. These families are often underemployed, and face challenges 

in employment. But on average, our developments run, again, they 

are Section 8. These are people at or below 50 percent of median 

income, but the vast majority of them are working. And that is a 

benefit, certainly. 

Mr. CARNEY. But I have the same problem frankly that I have 

heard from my colleagues on both sides of the aisle with respect 

to Section 8 waiting lists. They are just way too long. I go to a 

training session for mostly young women who are on TANF and 

one of their big complaints is that they can’t get any housing assistance because they can’t get a Section 8 voucher because folks 

aren’t moving off of it. 

I guess part of it is we don’t have enough of them. But it makes 

it extremely difficult for people who are moving up, we are trying 

to help. And give a hand up, to get that kind of assistance that 

they need. 

Mr. KELLY. Excuse me, sir. I didn’t mean to interrupt. But I will 

tell you with our project-based elderly developments, the waiting 

list is approximately 5 years. 

From Chelton Apartments down at Wilton Route 40, to Main 

Towers in Newark, those waiting lists run about 5 years. They are 

closed at the moment. Our family developments are probably 2 to 

3 years at a minimum. Obviously for families in dire need, that is 

an impossible— 

Mr. CARNEY. Mr. Fischer, any solutions? 

Mr. FISCHER. Yes, in terms of the points you just raised about 

helping people to move off of housing assistance and helping them 

move towards self-sufficiency, I think one way to do that, and it 

could be readily added to this bill that we are discussing today, 

would be improvements to the Family Self-Sufficiency Program. 

Senators Reid and Blunt, in the Senate, have a good bill to do 

that, and it has bipartisan support in House bills as well in the 

past. You mentioned the Moving to Work demonstration. I think 

you are right that it is a highly controversial issue and one that 

has played out differently in different places. It has resulted in 

some useful innovation, but it has also had harmful effects like 

transfers of voucher funds that resulted in fewer families getting 

23 

assistance and big increases in rents for the lowest-income families. 

So I think if there is an expansion of that it would be really important to make really fundamental reforms that would address some 

of those concerns. I know Ms. Waters has a proposal that would 

take steps in that direction. 

Mr. CARNEY. Thank you very much. Just with the 5 seconds, we 

are also experiencing an issue with continuum of care where the 

priority is being put into rapid rehousing, and it has very negatively affected transitional programs which are really, really important. 

Mr. Chairman, thanks so much for allowing me some time today. 

Chairman LUETKEMEYER. Always a pleasure. I thank the gentleman for his questions. Mr. Sherman, you were the last individual to go through round number one here. Are you ready to ask 

questions? If so, you will be recognized, or we can wait if you are 

not quite ready. You are used to popping stuff right off the top of 

your head, so I don’t think it will be a problem for you, but I wanted to give you time in case you do need that. 

Mr. SHERMAN. Thank you. Let me first ask the representative 

from the Home Builders, I believe that is Mr. Kelly. 

Chairman LUETKEMEYER. Mr. Sherman is recognized for 5 minutes. 

Mr. SHERMAN. Thank you. Mr. Kelly, I noticed in your testimony 

that you have discussed the flood plain management Executive 

Order and your concerns about how this would affect the cost and 

also the timeline of building new multi-family units. I particularly 

want to see multi-family units because the environmental footprint 

is so much less. The ability to then support rapid transit systems 

is there. 

I happen to live in a single-family detached house in my district, 

but I am an advocate for multi-family housing. Can you explain 

how this Executive Order will affect the timeline and the cost? 

Mr. KELLY. To be honest with you, we don’t know. What we 

know is it creates enormous uncertainty. It has gone essentially 

from what has been the rule for decades of the 100-year flood plain 

to essentially what is a 500-year flood plain. In addition, various 

agencies are given various discretions in evaluating a project to 

meet the provisions of this Executive Order. 

So I, as a developer, now have no idea whether or not a piece 

of land that I may be examining to use, whether it is urban and 

suburban or rural areas, would come under the restrictions of this 

Executive Order given its proximity to a body of water. Because at 

the moment, nobody does 500-year flood plains. Could I get an engineer to do it at some point in time? Yes. Then I would take that 

information to HUD. There are no standards by which the HUD 

field office can evaluate my request to build in that area. 

And so as a developer, the question is, first, why would I want 

to pursue it in the first place? And second, if I was crazy enough 

to do so, the question then becomes when, if ever, I will get an approval out of a HUD field office to make that determination. Uncertainty, uncertainty, uncertainty. 

Mr. SHERMAN. That certainly has to discourage the construction. 

I would point out that while I usually fight for my district, that 

was a nonparochial question because I represent a city built in a 

24 

desert during a drought. So that one was for the rest of the country. 

But, Mr. Polychron, continuing my focus on multi-family housing, 

we have condos. It is a good way for people to get their first home. 

First-time home buyers, H.R. 3700 has some provisions designed to 

facilitate condo sales, and those include allowing mixed-use space, 

streamlining the recertification of condo projects, and changing the 

owner occupancy requirements. 

How is that going to let people buy multi-family housing, and 

how is it going to affect people who have never owned a home and 

want to own one? 

Mr. POLYCHRON. Congressman Sherman, thank you for the question. I kind of answered the first two right before you got here, so 

if you would let me, I would like to go into the 25 percent commercial rule which certainly is in H.R. 3700. And thank you for that, 

sir. 

Because if you think about, especially in urban areas where you 

have a beautiful, let’s just call it a 200-unit building, and all of a 

sudden you want to have commercial space on the ground floor and 

maybe office space on the next two or three floors, if you have the 

25 percent cap, you cannot do that building. So we certainly think 

this is a tremendous opportunity to expand housing for condominiums in that manner. 

The private transfer fees are something else that have prohibited 

additional opportunities in condominium financing. First, you 

should know that NAR is opposed to any equity stripping type private transfer that might exist. We have always opposed that. 

Mr. SHERMAN. And I have joined you in that often. 

Mr. POLYCHRON. Certainly. 

Mr. SHERMAN. As have several here. 

Mr. POLYCHRON. But if that transfer fee benefits or improves 

that development or that project, we certainly think it ought to be, 

as if FHFA, be allowed to be part of the process. So thank you for 

that opportunity. 

Mr. SHERMAN. We have seen a number of these ‘‘live, work, shop’’ 

developments, mixed-use. They make a lot of sense. It is the only 

chance somebody will have to cut their commuting time and their 

commuting environmental footprint. You could sometimes, if you 

are lucky, commute to work on the elevator. 

So I think it makes sense for us to modernize these rules and 

allow the mixed-use buildings. Do you have one last comment? 

Mr. POLYCHRON. If you will allow me sir, the towncenter concept 

is what HUD has been promoting, and yet we restrict it by making 

the 25 percent rule, so hopefully we will get this passed, and certainly you will have our help. 

Mr. SHERMAN. I want to commend the author of H.R. 3700. I 

know there are some provisions on Section 8 that will still have to 

be worked out, and I look forward to working to get this bill on the 

Floor of the House. I yield back. 

Chairman LUETKEMEYER. I thank the gentleman for his comments, and his time has expired. 

I am going to do a quick second round of questions here, and I 

will begin with myself. I will follow up with you, Mr. Polychron, 

with regards to condos and home ownership. I just had a conversaVerDate Nov 24 2008 15:17 Sep 16, 2016 Jkt 099754 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 K:\DOCS\99754.TXT TERI
25 

tion last week with a housing authority owner in England, and he 

had a little bit of a different problem there. They have almost—he 

used the figure of 15 to 17 percent, public housing. And they are 

trying to over the last number of years shift a lot of that public 

housing to the private sector, in other words, allow people who are 

in their homes to find a way to own the home. 

I think in your testimony, Mr. Polychron, you indicate that the 

average condo cost, national average is 27 percent less than what 

a home is. So it seems to me it would follow that it would be a logical way for people to get into that first home and be able to get 

them to perhaps be able to rent it and then be able to get into some 

sort of a lease/purchase arrangement to be able to own property to 

allow some inflation in it to then be able to move on to another one. 

It seemed like a natural progression. I know that the English have 

figured out a way to get this done. 

I am wondering if you have any comments on something like 

that. I would like to work with you to come up with some ideas. 

This isn’t in this bill, but I think it is something we need to take 

a look at it somewhere down the road. I know we have tried to enhance FHA’s ability to expand and to begin to loan more money 

and look more favorably on condos, and I would like your thoughts 

on it. 

Mr. POLYCHRON. They moved it from 234 to 203B years ago in 

order to expand financing in condominiums. Yet we haven’t had 

any relaxation of the rule since just a little bit in 2012. If you look 

at it from another perspective, it is 27 percent cheaper in condominium pricing as far as single-family homes. But also, that a 

downpayment, which people sometimes have to save for 3 or 4 

years to make, becomes less of a burden when you do condominium 

financing versus single-family home. So that, too, would add to it. 

We know that not only first-time home buyers, but seniors who 

are downsizing and going into condo financing, their permanent 

home so they can use FHA, but only 4.2 percent of the portfolio is 

being used for condominiums at this time. It is certainly a market 

that we would love to work with to expand that number. 

Chairman LUETKEMEYER. I appreciate your comments. I know 

you also had a comment in your testimony with regards to electronic filing system being improved for the certification process? 

Mr. POLYCHRON. Yes. It just doesn’t make sense, especially in a 

smaller community where you don’t have a manager running that 

development, to where you have to submit totally from scratch 

again every 2 years. And it is really an 18-month process because 

it takes 6 months to get it approved. So basically, we would like 

to see the 2-year extended to perhaps 3 or 4 years—that doesn’t 

sound right—whatever we could get. 

Chairman LUETKEMEYER. You have a wish list. That is fine. 

Mr. POLYCHRON. But seriously, it is such a burden and cost as 

well to get that done. And what happens is that it is so time-consuming that the small HOA or POA just says, oh, to heck with it, 

there is a 60 percent decline rate anyway. I won’t take the time to 

do it. 

Chairman LUETKEMEYER. One of the problems is it is mainly 

done, and HUD for their FHA program is looking for some more 

money for the electronic across-the-board, electronic opportunities, 

26 

and that hasn’t been forthcoming, so it is a problem. I recognize it. 

But I appreciated the comment that you made. 

I am going to stop right there. The gentleman from Delaware, do 

you have any follow-up? I will recognize you for 5 minutes. 

Mr. CARNEY. Thank you, Mr. Chairman. I actually do have a 

quick follow-up question. I mentioned at the very end the Continuum of Care grant and the priority or bias if you will towards 

what they call rapid permanent rehousing. Is there anybody on the 

panel who could—apparently there is a priority given in States for 

permanent housing, and the effect on my little State of Delaware 

has been to end up defunding very important transitional housing 

programs, where somebody who is homeless, has some of the issues 

that homeless folks do with drug addiction and substance abuse 

and family issues, comes into transitional housing, kind of gets 

things sorted out, and then kind of moves to the next step. 

The bias now is to the development of get somebody in a home 

permanently and then work on those—or allow them to work on 

those problems. The effect is a funding one, right, ultimately; but 

I would just be interested in anybody who has a perspective on 

that? 

Ms. CRAIG. I am a past Chair of the Continuum of Care in Jackson County and have reallocated transitional programs to rapid rehousing and also operate transitional housing programs. I am not 

familiar with Delaware’s operation, so when you said ‘‘defunded,’’ 

I am not sure if that meant the continuum did not put that program in either Tier 1, where they would be funded, or if there was 

a reallocation process whereby voluntarily the program, as I had in 

one of my transitional programs, opted to reallocate from a transitional program into a rapid rehousing program. 

Mr. CARNEY. The effect of the scoring process meant that the 

transitional program lost $300,000 of support that they were getting, Ministry of Caring—Kevin knows our folks very well—to a 

program. It was doing great work. 

Again, we are talking about a world of scarce resources, and they 

have to go somewhere, and they went to a place where there was 

more permanent housing. It didn’t have any of the transitional substance abuse programs that go along with it. 

So some of that happens at the local level where they have the 

committee, but they argue that priority is coming down from the 

Fed on that. And I see somebody—I can’t read your name. 

Ms. BRADLEY-GEARY. It is Heather Bradley-Geary. Sorry. I feel 

very passionate about this subject. 

Mr. CARNEY. So do I. 

Ms. BRADLEY-GEARY. Yes. And we have different feelings on the 

passion of it. Transitional housing, although I am not saying the 

program isn’t great because it probably is, but the data does not 

support transitional housing. 

So a long time ago, HUD had transitional housing as one of their 

funding priorities, that somebody could be in housing for 24 

months, but then they move on, as you are saying. The data does 

not support it. It does not work. 

Mr. CARNEY. This goes back to the question that we had before 

about Moving to Work. Maybe it doesn’t work everywhere, but 

there are places where things work differently. 

27 

We like to think we are different in Delaware. We are. We are 

a small State. We are a manageable State, and in that sense we 

can count the people, okay, and where they have gone and whatever. We are that small. We are one district. I am it. I am the one 

guy we get down here or the one person that we get down here. 

And so, the effect has been some significant problems for some of 

the most effective programs that we have in dealing with homeless 

populations. 

Ms. GAWRILOW. Sir, if I may? 

Mr. CARNEY. Sure. Jump in, particularly if you are on my side 

of the question. 

Ms. GAWRILOW. I might have a different view as well. But HUD 

has been pushing COCs, Continuum of Cares, to do increased rapid 

rehousing, for multiple populations, because there simply aren’t 

enough resources, there are not enough beds in emergency shelters, 

there is not enough supported housing for higher-need populations. 

And what has happened is then a conversion to rapid rehousing 

programs, and as Heather said, HUD right now has done a study 

on the differences of comparing transitional housing outcomes, 

rapid rehousing outcomes, and permanent subsidies for homeless 

families, and the outcomes between transitional housing and permanent subsidies for families, it is incredible. The difference in the 

outcomes, the well-being outcomes for the families, is so much better in permanent housing than in the transitional housing and it 

is cheaper. 

And that kind of—HUD has been rethinking this, but that is not 

to say that there aren’t—different markets are going to need different, have different housing needs. And permanent supportive 

housing doesn’t mean a person has to stay there permanently. 

Ideally, they would not. They would address their underlying 

issues and then eventually be able to move on to an independent 

living situation. But the housing— 

Mr. CARNEY. My time is way up. 

Ms. GAWRILOW. Sorry. 

Chairman LUETKEMEYER. Go ahead and finish. 

Ms. GAWRILOW. Oh, I was just going to say, the housing is supposed to be made permanent so people who are in crisis come in 

and get the supportive services they need, and that system is going 

to be so much cheaper, to the emergency health systems, to the 

criminal justice, the jail system, and to detox centers. 

Ms. CRAIG. May I just say one more thing? I am so sorry. Continuum of Care has been brought up a lot lately, and this is a time 

of major changes, and you have probably read that Continuum of 

Care was unheard of before in many times in many places that programs were being defunded. 

So I think everybody over the past 3 years is really trying to figure out how this is going to work nationwide as well as within our 

communities. So we all are trying to do a much better job of 

prioritizing, communicating within our communities, doing it well 

in advance of the NOFA, which you should not when the funding 

comes down. 

So I will say there certainly have been probably any number of 

cases where that hasn’t been handled appropriately. It is correct 

that per capita there almost is nothing more expensive short of 

28 

group homes than transitional housing. It is very appropriate for 

certain populations, very appropriate in many ways. 

We would have sat here 10 years ago and what you would have 

heard is that HUD’s preference was for transitional housing over 

permanent housing. I happened to raise $4 million to renovate 24 

units of family transitional housing 8 years ago because I thought 

that was a good idea. Luckily, now I am able to use them for vets. 

So my point is, it goes back to that larger question about 

prioritization. 

And so let me just share with you very quickly, in one year in 

the two traditional HUD transitional family programs I operated, 

I had 88 families enter. Of those 88 families, 56 were not street or 

shelter homeless. They came from living with their families. Well, 

doubled up is not comfortable—I understand that—but it isn’t the 

same. And I also would say when I have folks who are trying to 

get vouchers from the Housing Authority come to my program and 

want homeless letters, they are living with their family. And I understand that is uncomfortable, but I can’t give you a homeless letter. 

But I asked my staff, of those 56 families who came from living 

with family or friends, did we ask them if they had other resources 

that we could exercise with them so they didn’t have to come into 

shelter, and we could make sure that we were prioritizing those 

spaces for families who were in fact street and shelter homeless because there aren’t enough resources. We all are— 

Mr. CARNEY. Mr. Chairman, thank you so much. I am way over, 

and I am not even on the committee. God bless you. 

Ms. CRAIG. Sorry. 

Chairman LUETKEMEYER. That is okay. That was a great question and was a great answer, and I appreciate your passion. 

With that, Mr. Cleaver has waived a second round of questioning, so with that we would like to thank our witnesses for their 

testimony today. We certainly appreciate your expertise, your advice, your counsel, and your passion for all of these issues and for 

all the help that you have given us in developing the bill, for your 

ideas of improving the bill today. 

And we want to continue to work with each of you and your 

groups that you represent to try and continue to make this the best 

bill and the best opportunity we have to pass something. It is going 

to make a difference in the lives of a lot of people. 

The Chair notes that some Members may have additional questions for this panel, which they may wish to submit in writing. 

Without objection, the hearing record will remain open for 5 legislative days for Members to submit written questions to these witnesses and to place their responses in the record. Also, without objection, Members will have 5 legislative days to submit extraneous 

materials to the Chair for inclusion in the record. 

[Whereupon, at 4:18 p.m., the hearing was adjourned.] 

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A P P E N D I X 

October 21, 2015 

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87 


99754.058
88 


99754.059