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S. HRG. 112–515 

THE CHOICE NEIGHBORHOODS INITIATIVE: A 

NEW COMMUNITY DEVELOPMENT MODEL 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

HOUSING, TRANSPORTATION, AND COMMUNITY 

DEVELOPMENT 

OF THE

COMMITTEE ON 

BANKING, HOUSING, AND URBAN AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

ON 

EXAMINING THE CHOICE NEIGHBORHOODS INITIATIVE AND HOW IT 

COULD BE IMPROVED, AND HOW COST-EFFECTIVE CHOICE NEIGHBORHOODS AND ITS PREDECESSOR, HOPE VI, ARE IN TERMS OF OUTCOMES FOR FAMILIES AND NEIGHBORHOODS AND GRANTEES IMPLEMENTING ACTIVITIES IN OUR COMMUNITIES 

MARCH 27, 2012 

Printed for the use of the Committee on Banking, Housing, and Urban Affairs 

( 

Available at: http://www.fdsys.gov/ 
COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS 

TIM JOHNSON, South Dakota, Chairman 

JACK REED, Rhode Island 

CHARLES E. SCHUMER, New York 

ROBERT MENENDEZ, New Jersey 

DANIEL K. AKAKA, Hawaii 

SHERROD BROWN, Ohio 

JON TESTER, Montana 

HERB KOHL, Wisconsin 

MARK R. WARNER, Virginia 

JEFF MERKLEY, Oregon 

MICHAEL F. BENNET, Colorado 

KAY HAGAN, North Carolina 

RICHARD C. SHELBY, Alabama 

MIKE CRAPO, Idaho 

BOB CORKER, Tennessee 

JIM DEMINT, South Carolina 

DAVID VITTER, Louisiana 

MIKE JOHANNS, Nebraska 

PATRICK J. TOOMEY, Pennsylvania 

MARK KIRK, Illinois 

JERRY MORAN, Kansas 

ROGER F. WICKER, Mississippi 

DWIGHT FETTIG, Staff Director 

WILLIAM D. DUHNKE, Republican Staff Director 

BETH COOPER, Professional Staff Member 

DAWN RATLIFF, Chief Clerk 

RIKER VERMILYE, Hearing Clerk 

SHELVIN SIMMONS, IT Director 

JIM CROWELL, Editor 

SUBCOMMITTEE ON HOUSING, TRANSPORTATION, AND COMMUNITY DEVELOPMENT

ROBERT MENENDEZ, New Jersey, Chairman 

JIM DEMINT, South Carolina, Ranking Republican Member 

JACK REED, Rhode Island 

CHARLES E. SCHUMER, New York 

DANIEL K. AKAKA, Hawaii 

SHERROD BROWN, Ohio 

JON TESTER, Montana 

HERB KOHL, Wisconsin 

JEFF MERKLEY, Oregon 

MICHAEL F. BENNET, Colorado 

MIKE CRAPO, Idaho 

BOB CORKER, Tennessee 

PATRICK J. TOOMEY, Pennsylvania 

MARK KIRK, Illinois 

JERRY MORAN, Kansas 

ROGER F. WICKER, Mississippi 

MICHAEL PASSANTE, Subcommittee Staff Director 

JEFF MURRAY, Republican Subcommittee Staff Director 

(II)
C O N T E N T S 

TUESDAY, MARCH 27, 2012 

Page 

Opening statement of Chairman Menendez .......................................................... 1 

WITNESSES 

Sandra Henriquez, Assistant Secretary for Public and Indian Housing, Department of Housing and Urban Development .................................................. 2 

Prepared statement .......................................................................................... 22 

Maria Maio, Executive Director, Jersey City Housing Authority ........................ 7 

Prepared statement .......................................................................................... 28 

Susan J. Popkin, Ph.D., Director, Program on Neighborhoods and Youth 

Development, Urban Institute ............................................................................ 9 

Prepared statement .......................................................................................... 30 

Anthony B. Sanders, Ph.D., Distinguished Professor of Finance, George 

Mason University School of Management .......................................................... 11 

Prepared statement .......................................................................................... 36 

Paul N. Weech, Executive Vice President, Policy and Member Engagement, 

Housing Partnership Network ............................................................................ 12 

Prepared statement .......................................................................................... 38 

Egbert L.J. Perry, Chairman and Chief Executive Officer, The Integral Group 

LLC ........................................................................................................................ 14 

Prepared statement .......................................................................................... 48 

ADDITIONAL MATERIAL SUPPLIED FOR THE RECORD

Prepared statement submitted by Mitchell J. Landrieu, Mayor, City of New 

Orleans, Louisiana ............................................................................................... 52 

Letter submitted by Stewards of Affordable Housing for the Future ................. 54 

Letter submitted by Michael Rubinger on behalf of the Local Initiatives 

Support Corporation ............................................................................................ 56 

(III)

(1) 

THE CHOICE NEIGHBORHOODS INITIATIVE: A 

NEW COMMUNITY DEVELOPMENT MODEL 

TUESDAY, MARCH 27, 2012 

U.S. SENATE, SUBCOMMITTEE ON HOUSING, TRANSPORTATION, AND

COMMUNITY DEVELOPMENT, COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, Washington, DC. 

The Subcommittee met at 10:40 a.m. in room SD–538, Dirksen 

Senate Office Building, Hon. Robert Menendez, Chairman of the 

Subcommittee, presiding. 

OPENING STATEMENT OF SENATOR ROBERT MENENDEZ 

Senator MENENDEZ. Good morning, and let me say we are sorry 

we are starting a few minutes late. We had a conference call with 

several parties, and it lasted a little longer than I had expected. 

The hearing of the Senate Banking Committee’s Subcommittee 

on Housing, Transportation, and Community Development will examine the Choice Neighborhoods Initiative, both as it has been enacted through appropriations thus far and as it is proposed in my 

bill, the Choice Neighborhoods Initiative Act of 2011, S. 624. 

Among the issues considered will be how the program differs 

from its predecessor, the HOPE VI program; how it could be improved; how cost-effective Choice Neighborhoods and HOPE VI are 

in terms of outcomes for families and neighborhoods and grantees’ 

planning and implementation activities on the ground in our local 

communities. 

Choice Neighborhoods aims to revitalize severely distressed communities of concentrated poverty which are often marked by high 

crime and unemployment rates, health disparities, struggling 

schools, and faltering civic institutions. Built on a foundation of 

over 15 successful years of bipartisan HOPE VI, Choice Neighborhoods embodies the best of HOPE VI, but builds on it by asking 

grantees to develop plans for integrated supports for residents, ensuring high-quality educational opportunities for children, access to 

transportation and jobs, and providing health options and job readiness skills for families. Moreover, Choice Neighborhoods expands 

HOPE VI redevelopment techniques to aid in providing redevelopment of private federally assisted properties alongside public housing, and there is huge demand for the program with local applications far outstripping the funds available for it. 

All Americans should enjoy equal opportunity and access to affordable housing in safe neighborhoods. It is imperative that we 

continue to support Choice Neighborhoods as it provides long-term 
2 

viability for families and communities nationwide. I look forward to 

hearing from the witnesses as they discuss their experiences with 

HOPE VI and Choice Neighborhoods and the potential of Choice 

Neighborhoods as a practical, cost-saving solution to redevelopment 

of distressed housing and neighborhoods that leverage private, nonprofit, and local resources to a much greater degree. 

We are thrilled to have a host of witnesses. We are going to start 

off with the Honorable Sandra Henriquez, who is the Assistant 

Secretary for Public and Indian Housing at the U.S. Department 

of Housing and Urban Development. As part of the senior leadership team at HUD, Ms. Henriquez oversees the Nation’s public 

housing, rental assistance programs, and Native American and Native Hawaiian programs. She is the past administrator and chief 

executive officer of the Boston Housing Authority and the past 

president and director of the Council of Large Housing Authorities. 

With that, Madam Secretary, we appreciate your appearance. We 

would ask you to synthesize your statement for about 5 minutes. 

Your full statement will be entered into the record, and please proceed. 

STATEMENT OF SANDRA HENRIQUEZ, ASSISTANT SECRETARY 

FOR PUBLIC AND INDIAN HOUSING, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 

Ms. HENRIQUEZ. Thank you very much, Mr. Chairman. It is good 

to be here, and thank you for this opportunity to discuss how the 

Choice Neighborhoods program uses proven tools to transform 

neighborhoods by revitalizing not just public housing but all kinds 

of federally supported housing in poor neighborhoods. 

Today I want to describe the need for authorizing Choice Neighborhoods, how it builds on the progress of the HOPE VI program, 

and how at a time when our national economy is growing it helps 

local leaders turn around distressed neighborhoods that are critical 

to helping regional economies rebound. 

In less than 2 years, this program has already had great success 

helping communities tackle housing distress and leveraging private 

dollars. I am particularly grateful for the leadership that you have 

shown, Mr. Chairman, in sponsoring legislation that would authorize Choice Neighborhoods formally. 

As local leaders continue to dig their communities out of the 

worst recession since the Great Depression, we recognize that the 

cost of poverty, particularly concentrated poverty, to our society 

and to our economic future is high. Today more than 10 million 

people live in neighborhoods of concentrated poverty—surrounded 

by disinvestment, failing schools, troubled housing, and, worst of 

all, virtually no path to opportunity for themselves or for their children. And that is why this Administration has pursued Choice 

Neighborhoods, which builds on the HOPE VI public housing revitalization program pioneered by HUD Secretaries Jack Kemp and 

Henry Cisneros. 

With strong bipartisan support, HOPE VI has created more than 

90,000 housing units in healthy, mixed-income communities that 

were once troubled by distressed public housing, leveraging twice 

the Federal investment with additional private capital and raising 

the average income of residents by 75 percent or more. 
3 

Chairman Menendez, HOPE VI changed the face of public housing in America, but in many neighborhoods that is simply not 

enough. In Little Rock, Arkansas, a struggling neighborhood just 

southeast of the downtown area is being challenged by both a severely distressed public housing development, Sunset Terrace, as 

well as a severely distressed 50-unit HUD-assisted, project-based 

Section 8 development, Elm Street. Both properties have deteriorating foundations and structures, electrical and plumbing problems, and the surrounding neighborhood is affected by high crime, 

poor schools, and widespread vacancy. 

In the past, this neighborhood would have presented a worst-case 

situation for HUD because two separate and distinct HUD program 

areas were contributing to its deterioration. With HOPE VI, the 

community could have redeveloped the public housing property, but 

the Elm Street housing development in Little Rock would have 

been out of reach simply because it was subsidized by a different 

program at HUD. 

Now, we all know that residents do not make the distinction between public housing and project-based Section 8. Communities do 

not make that distinction, and those who engage in criminal activity certainly do not make that distinction. And 3 years ago, the 

only one making that distinction was HUD, but with Choice Neighborhoods, we are not anymore. 

Indeed, having secured a Choice Neighborhoods Planning Grant, 

the Little Rock Housing Authority is partnering with the owner of 

the HUD-assisted development to engage city and civic leaders in 

turning around the neighborhood. Choice builds on HOPE VI by 

recognizing that the problem of high concentrations of distressed 

housing in a single neighborhood of concentrated property is not 

limited solely to public housing. Indeed, we are not only hearing 

this from private owners, but we hear it from public housing authority executive directors, from mayors, residents, and other leaders across the country. They are telling us that Choice Neighborhoods is exactly the kind of catalytic tool they need to revitalize 

distressed neighborhoods with the flexibility local leaders want and 

need to address their specific challenges, from improving neighborhood infrastructure to ensuring high-quality, early learning opportunities for children. They know that Choice Neighborhoods funds 

leverage significant dollars from the private and public sector. Already the $122 million in implementation grants that we have 

made thus far has leveraged a combined $1.6 billion, over 13 times 

their total grant award, with more to come as the redevelopment 

work accelerates. 

Mr. Chairman, that is real and serious return on the Federal investment, but that is not all that Choice Neighborhoods leverages. 

Indeed, at a time when Federal dollars are precious, Choice Neighborhoods has been critical to strengthening taxpayer dollars further. In Seattle, a $10 million grant is leveraging $32 million from 

the Seattle Department of Transportation to ensure families can 

get to and from work, while Boston is leveraging $350,000 in workforce investment funds to ensure residents can get the job training 

they need to be part of the 21st century economy. New Orleans’ grant is leveraged nearly $1 million from Head 

Start and another half million from a federally qualified health 
4 

center so children can get the quality education and care they need 

to grow up healthy. 

In San Antonio’s Eastside neighborhood, where almost half of the 

area’s residents live in poverty and drop out of school, Choice is 

working in concert with the Department of Education’s Promise 

Neighborhoods program. As the city’s Choice Neighborhoods planning grant helps the city plan to revitalize Wheatley Courts public 

housing, its Promise Neighborhoods grant will help improve 

schools. It is the same consortium of local and partner institutions 

at the table that are building a vision, a shared vision for this 

work, and this funding ensures public, private, and nonprofit partners are all working together to provide good schools and quality 

learning opportunities in the center of these neighborhoods. 

It is about attacking interconnected challenges with comprehensive proven tools. It is about understanding that local problems require locally driven solutions. It is about understanding that the 

Federal Government can serve as an effective supporting partner. 

It is about making taxpayer dollars go as far as they can. But, fundamentally, it is about making sure every American gets a fair 

shot, whoever they are, wherever they live. That is what Choice 

Neighborhoods is all about. That is why we ask Congress to authorize this program, and that is why I am so appreciative of this opportunity to appear before you today. 

Thank you and I look forward to your questions. 

Senator MENENDEZ. Well, thank you very much for that overview. 

Let me just take advantage that you are here and we are developing a record to ask you some questions, and I think you in some 

respects touched upon this, but I want to hone in for our colleagues 

who will be reading the transcript. How does Choice Neighborhoods 

represent a new model of community development compared to 

HOPE VI? 

Ms. HENRIQUEZ. Thank you for the question. As you know, 

HOPE VI really was limited only for housing authorities to apply 

and really looked at revitalizing the footprint of the existing public 

housing developments. And the revitalization efforts beyond that 

footprint might have been able to be accomplished, but not necessarily with the same strength and vitality we see coming out of 

the Choice Neighborhoods program. 

Choice differs in that it takes the lessons we have learned from 

housing authorities in their creativity in their local levels, but 

takes it a step further so that there are more partners at the table. 

Not only housing authorities can apply, but project-based Section 

8 multi-family owners can apply, city governments can apply, and 

it really builds a comprehensive shared vision for community reinvestment and revitalization, looking beyond the public housing or 

the single housing site footprint. 

It makes sure that the commitment is shared, the resources are 

shared, and, therefore, those resources will go further and have a 

greater impact in revitalizing well into the community neighborhood in which those properties are located. 

Senator MENENDEZ. Now, in your testimony you referred to 

leveraging, which I appreciate. In that context, can you explain the 

importance of partnerships to the success of Choice Neighborhoods. 
5 

Ms. HENRIQUEZ. Partnerships are vitally critical, and through 

this process we have learned at HUD to be a better partner, to support visions of local government and communities. But, indeed, if 

you start really talking about what Choice brings to the table, it 

is to have people talking at the local level who maybe did not do 

that before to get investment, to figure out where people’s individual resources are in a community, and bring them together in 

a conversation so that everybody then understands we are serving 

a similar constituency, but we want to make sure that our dollars 

are going further and we understand better as a community at the 

local level what a community needs to be healthy, all the things 

that we all take for granted, or many of us take for granted: good 

education, good public transportation, safety on our streets. All of 

what we would call the infrastructure, the backbone, and the 

amenities that one would find in any well-developed community, 

that is what we are trying to return to distressed communities 

through the Choice Neighborhoods program. 

Senator MENENDEZ. And in your examples of successful 

leveraging or investments under the Choice Neighborhoods program created a ripple effect, would those have taken place but for 

Choice Neighborhoods, the likelihood of that? 

Ms. HENRIQUEZ. The likelihood is that they would not have. We 

have seen some leveraging in the HOPE VI program. We see probably it is 2:1 or 3:1 in terms of the Federal investment. On the 

Choice side, we are already seeing 13 times. 

I work to stress, though, that some of the leveraging and the 

benefits we will not see. They will continue to build. You will see 

better health outcomes, better education outcomes, more economic 

independence for residents in those communities. And so the ripple 

effect will be larger, longer, and stronger. 

Senator MENENDEZ. That precipitates what was my next question. Can you give us examples of how this can improve cost-effectiveness? I would assume those are elements of it, the ones you just 

described. 

Ms. HENRIQUEZ. They are. We believe that with these kinds of 

improvements and investments, you will do a number of things. 

You will revitalize not just the neighborhood where that Choice 

Neighborhoods grant is being implemented. You will continue a 

conversation on the ground. You will see reinvestment from the 

private sector coming back into other parts of that community. You 

will see, we believe, economic vitality, businesses reinvesting in 

those neighborhoods. We are just not sure of all of what you will 

see. We think that it will be to the level of something we will be 

measuring 10, 15, 20 years from now and beyond. 

Senator MENENDEZ. Which then brings me to my final set of 

questions. In HUD’s experience, what has been the local demand 

for programs like Choice Neighborhoods? And how many applicants 

are there, and how much is HUD able to fund? 

Ms. HENRIQUEZ. We funded five implementation grants this 

past—a year ago. I think we had over 100 applications for that. 

We, therefore, right now have funded a total in 2 years of 30 planning grants so that local neighborhoods can start the conversation 

to get themselves ready to apply for an implementation grant. We 

have given 30 of those out, and we have had hundreds of inquiries 
6 

and applications for those limited numbers of planning grants as 

well. And the demand keeps building. 

Senator MENENDEZ. One of our panelists on this next panel will 

say that this is actually a fairly small program and question 

whether or not that is of value considering that, among other 

issues. Are there benefits that accrue to applicants who apply for 

Choice Neighborhoods grants but do not get one? 

Ms. HENRIQUEZ. I would say undeniably yes. While it is a relatively small program, the leveraging and the amount of other private and public sector dollars that come into the arena for revitalization keeps multiplying and multiplying and multiplying. The 

benefit of having planning grants even if those communities are 

not successful in getting an implementation grant is that the conversation and the shared vision and the shared planning moving 

forward really helps those communities begin to identify and leverage other kinds of programs and other kinds of dollars that they 

might not have thought about before, and they can do lots of that 

work with very little funding and at least identify the direction in 

which as a community they want to move. And as resources become 

identified, they can put those resources toward that shared vision. 

And I think that that is a huge benefit to begin the conversation 

and to get everybody at the table thinking about how they want all 

of their citizens to live. 

Senator MENENDEZ. Well, I appreciate your testimony. In your 

testimony you say we can predict outcomes in health, education, 

and economic outcomes of children based on zip code. 

Ms. HENRIQUEZ. That is correct. 

Senator MENENDEZ. And it seems to me that that is a pretty sad 

reality. We should live in a Nation in which the happenstance of 

what zip code you live in is not the determinant of where you will 

end up in life. 

Ms. HENRIQUEZ. We wholeheartedly agree. 

Senator MENENDEZ. And so I look forward to working with you 

in this one area. This is only one of many, but one area that I think 

we can, for a relatively small amount of money, make a big difference. 

Thank you very much for your testimony and for your leadership. 

Ms. HENRIQUEZ. Thank you very much. 

Senator MENENDEZ. With that, let me introduce our next panel, 

and I will ask them to come up as the Secretary leaves with the 

thanks of the Committee. 

Ms. Maria Maio is the Executive Director of the Jersey City 

Housing Authority, which has more than 2,500 public housing 

units, more than 3,900 rental vouchers, and three HOPE VI demolition and revitalization programs. Ms. Maio has over 40 years of 

professional experience—because she was taken from the crib to 

start in this field—in planning, developing, financing, administering, and managing assisted housing in Jersey City. I have 

known her for a very long time, and I appreciate her coming from 

New Jersey to give us an on-the-ground perspective how Choice 

Neighborhoods is working in Jersey City. I appreciate your leadership. It has just been extraordinary. 

Dr. Susan Popkin is the Director of the Urban Institute’s Program on Neighborhoods and Youth Development. Dr. Popkin’s re-
7 

search has focused on the impact of the changes in housing policy 

over the past decade on the lives of the most vulnerable public and 

assisted housing families, including the HOPE VI panel study, the 

first large-scale systematic look at outcomes for families relocated 

from public housing. We welcome you to the Committee. 

Dr. Anthony Sanders is a Distinguished Professor of Finance in 

the School of Management at George Mason University, a Senior 

Scholar at the Mercatus Center, and he has been before the Committee many times, and we appreciate him coming back with us 

again. 

Mr. Paul Weech is the Executive Vice President for Policy and 

Member Engagement at the Housing Partnership Network. He has 

served as Vice President for mission strategy execution at Fannie 

Mae, Chief of Staff at the United States Small Business Administration, Staff Director for the Subcommittee on Housing and Community Development for this Committee—which is the most significant of all the Subcommittees—and Senior Analyst for housing and 

credit for the U.S. Senate Committee on Budget. We welcome you 

back to the Senate as well. 

Mr. Egbert Perry is the Chairman and Chief Executive Officer of 

the Integral Group, a full-service development and real estate advisory and investment management firm. Mr. Perry has provided the 

entrepreneurial leadership and vision to grow the firm into a leading innovator in the field of mixed-use and mixed-income developments as well as a driving factor in creating private-public partnerships that create opportunity for development and redevelopment 

in underserved communities. 

Let me welcome you all to the Committee. In the order in which 

I introduced you, starting with Ms. Maio, I will ask you to summarize your statement in about 5 minutes. All of your full statements 

will be included in the record, and with that, we welcome you. 

STATEMENT OF MARIA MAIO, EXECUTIVE DIRECTOR, JERSEY 

CITY HOUSING AUTHORITY 

Ms. MAIO. Thank you, Chairman Menendez. I greatly appreciate 

your invitation and am honored to be here today to testify before 

the Subcommittee. 

As you are aware, the Jersey City Housing Authority received 

one of the first 2010 Choice Neighborhoods planning grants and 

now is in the midst of preparing an application for a Choice Neighborhoods Implement Grant. 

As has been mentioned, Choice Neighborhoods builds upon the 

model and achievements of the HOPE VI program. HOPE VI has 

transformed communities by turning severely distressed public 

housing into mixed-income, mixed-use, and revitalized communities 

that serve as long-term assets in their neighborhoods. HOPE VI 

has led the way in establishing new partnerships and leveraging 

additional resources. HOPE VI has also been a pioneer and laboratory for neighborhood place-based redevelopment. This has been 

true for us. 

The Jersey City Housing Authority has been awarded three 

HOPE VI Revitalization Program grants, which have resulted in 

730 constructed units and 275 planned units in mixed-income communities including public housing, affordable, and market-rate 
8 

units. Our HOPE VI communities have served as a model for developing quality sustainable affordable housing, which has been applauded by City, State, and Federal officials and residents of public 

housing and the broader community and imitated by private and 

not-for-profit developers. 

Our HOPE VI programs met the goals of rebuilding severely distressed public housing, deconcentrating poverty, leveraging nonFederal funds—for us $3 for every dollar of HOPE VI—and providing higher-quality, efficient affordable housing with reduced operating costs through the physical transformation to mixed-income 

developments and a Community and Supportive Services Program 

that focused on self-sufficiency initiatives, with a major goal of reducing unemployment. 

The HOPE VI program also began the organizational transformation of the Jersey City Housing Authority from property manager to developer. Today the housing authority is regarded as the 

major affordable housing developer in the city. Severely distressed 

public housing has been replaced with lower-density housing that 

complements the existing neighborhood, new developments that are 

community assets, and attracting a diverse economic resident population in well-maintained housing. Critics of the stereotyped public 

housing have become the strongest supporters of our HOPE VI developments. 

Much of the success of our HOPE VI program is the result of our 

strong commitment to Section 3 local hiring initiatives. To date, 

500 public housing/local residents have been hired and $22 million 

has been targeted to Minority Business Enterprises. To date, 66 

percent of the public housing units in HOPE VI developments have 

been leased to former relocatees. But perhaps the best indication 

of success comes from a public housing resident who returned to a 

HOPE VI development and expressed how her child can ‘‘sleep in 

peace, I don’t hear gun shots in the middle of the night.’’ 

Whereas the major HOPE VI focus was on addressing severely 

distressed public housing, Choice capitalizes on the strengths of institutions and assets of the neighborhood, convenes all neighborhood stakeholders and encourages their input, and pulls together 

disparate developments in various stages to plan and implement a 

singular comprehensive neighborhood transformation plan through 

tried-and-true successful public-private partnerships. 

The Choice Neighborhood Initiative will allow us to expand on 

our successful public-private partnerships to develop a comprehensive plan for a neighborhood that includes the transformation of 

Montgomery Gardens, our remaining high-rise family development 

within the broader McGinley Square-Montgomery Corridor Neighborhood. Montgomery Gardens is currently perceived as a liability 

to further renewed investment in the neighborhood. 

Perhaps most importantly, the transformation of Montgomery 

Gardens to a new Choice community that guarantees one-for-one 

replacement housing, ensures that the inevitable gentrification that 

will accompany market rate development will be addressed by the 

inclusion of affordable housing resulting in a quality mixed-income 

community. 

In closing, I thank you for the opportunity to testify today and 

am available for any questions. Thank you. 
9 

Senator MENENDEZ. Wow, you set a precedent. You still had a 

minute. 

Ms. MAIO. I know. 

[Laughter.] 

Ms. MAIO. I am from Jersey. 

[Laughter.] 

Senator MENENDEZ. Only the strong survive. All right. 

Dr. Popkin? No pressure for the rest of the panel. 

Ms. POPKIN. I do not know if I can match that. 

STATEMENT OF SUSAN J. POPKIN, PH.D., DIRECTOR, PROGRAM ON NEIGHBORHOODS AND YOUTH DEVELOPMENT, 

URBAN INSTITUTE 

Ms. POPKIN. Senator Menendez, thank you for inviting me to appear here today. For the past 14 years, I have been studying the 

impact of the HOPE VI program on the original residents of public 

housing projects that are demolished and replaced. While most of 

my research has focused on Chicago, I have conducted research in 

13 HOPE VI sites around the country. The testimony I present 

here today draws from four major studies: the HOPE VI Panel 

Study, which tracked residents from five sites across the country; 

the Chicago Panel Study; the Chicago Family Case Management 

Demonstration; and the new HOST Demonstration. 

The three main takeaways from this research are: 

Because of HOPE VI redevelopment, most former residents now 

live in better housing and neighborhoods that are considerably less 

poor and dramatically safer than their original distressed public 

housing communities. 

HOPE VI was less successful in helping families improve their 

economic circumstances and was not a solution for the most vulnerable households. 

Our subsequent research makes clear that many families require 

more intensive, better coordinated services and that comprehensive 

community redevelopment efforts seeking to improve the well-being 

of all residents in distressed neighborhoods will need to provide intensive services that intentionally target both vulnerable children 

and adults. 

HOPE VI was at its core a housing intervention, and there is no 

question that the program changed the face of public housing and 

succeeded in its goal of improving residents’ life circumstances. Our 

studies find that the majority of families have experienced meaningful improvement in their housing and overall quality of life as 

a result of HOPE VI redevelopment, even though most residents 

have not moved back to the new, mixed-income communities. Most 

residents are living in communities that are less poor and dramatically safer. For example, after relocation, the proportion of respondents in our study who rated violence—shootings, attacks, and sexual assault—as big problems in their communities declined by 

more than 50 percent. The benefits of these improvements in safety 

are profound, with residents reporting significantly lower levels of 

anxiety and fear and describing being able to sleep better and feeling comfortable letting their children play outside. 

But this research also highlights the significant challenges that 

remain, particularly residents’ shockingly poor health and persist-
10 

ently low levels of employment, problems that will require more intensive, focused interventions. At every age level, HOPE VI Panel 

Study respondents are more likely to describe their health as fair 

or poor than other adults and to report suffering from a range of 

chronic, debilitating conditions, including arthritis, asthma, obesity, depression, diabetes, hypertension, and stroke. The mortality 

rate for these residents was stunningly high—more than twice that 

of the general population. 

In addition to providing an improved living environment, HOPE 

VI sought to help residents attain self-sufficiency. However, our research shows that employment rates have remained persistently 

low, averaging just under 50 percent. Physical and mental health 

problems, particularly mobility limitations, are by far the biggest 

barrier to employment. 

Many residents who leave public housing struggle to make ends 

meet. Our studies show that many are forced to make tradeoffs between paying their rent and keeping up with utility payments and 

even affording food for their families. 

The HOPE VI program was not a solution for the most vulnerable former residents, the subset of hard-to-house families who 

make up a large share of the population in distressed public housing and struggle with multiple complex problems like physical and 

mental health problems, low levels of educational attainment, weak 

labor force attachment, substance abuse, and domestic violence. 

For the past 5 years, the Urban Institute has been working with 

housing authorities to test more intensive service models to address these deeper challenges. Our first demonstration ran from 

2007 to 2010, providing participants with intensive case management, transitional jobs, financial literacy training, and mobility 

counseling to support participants in moving to communities that 

offered better opportunities. 

The demonstration was remarkably successful, engagement was 

high, and participants reported gains in employment, physical and 

mental health, and housing and neighborhood conditions, but the 

benefits of intensive services and case management for adults did 

not trickle down to their children. 

Developing effective place-based models that do reach youth is 

critical not only for improving the lives of individual children but 

also for ensuring the health and viability of public and mixed-income communities. If successful, these strategies can reduce problems that drive residents away from neighborhoods: vandalism, 

drug trafficking, fighting, and gang activity. 

The Urban Institute’s new, multisite HOST Demonstration is 

testing these kinds of dual-generation service models aimed at improving the life chances of vulnerable low-income families living in 

both public and mixed-income communities. 

Incorporating intensive case management and permanent supportive housing for the most vulnerable residents into Choice 

Neighborhoods and any other comprehensive redevelopment efforts 

is one way to ensure that these initiatives truly meet the needs of 

all public housing families. The Choice Neighborhoods Initiative 

builds on the successes of HOPE VI and broadens the scope of revitalization efforts beyond public housing to the surrounding community, including schools and other types of housing. However, if this 
11 

new effort is to be more successful than its predecessor in improving the lives—and long-term life chances—of the families who suffered the worst consequences of living in distressed public housing, 

it must incorporate strategies that effectively address their needs. 

None of these solutions are simple, and all will require a long-term 

commitment to improving the quality of life for these families and 

ensuring better futures for their children. 

Thank you. 

Senator MENENDEZ. Thank you. 

Dr. Sander. 

STATEMENT OF ANTHONY B. SANDERS, PH.D., DISTINGUISHED 

PROFESSOR OF FINANCE, GEORGE MASON UNIVERSITY 

SCHOOL OF MANAGEMENT 

Mr. SANDERS. Senator Menendez and distinguished Members of 

the Committee, my name is Dr. Anthony B. Sanders, and I am the 

Distinguished Professor of Finance at George Mason University 

and a senior scholar at the Mercatus Center. It is an honor to testify before this Committee today. 

I am here to discuss a proposed Senate bill, S. 624, the Choice 

Neighborhoods bill. This bill calls for $350 million in 2012 for competitive grants to revitalize distressed neighborhoods. 

As someone who has lived on the South Side of Chicago and outside of Elizabeth in Jersey City, New Jersey, I clearly understand 

the spirit of what this legislation is attempting to do. 

But $350 million spread over the United States for distressed 

neighborhoods is a drop in the bucket. Bear in mind that Stanford 

University recently built a business school campus—two buildings—for $345 million. And yet Detroit, Cleveland, and many other 

inner cities continue to suffer. 

Now, I have a question and a suggestion. The Department of 

Housing and Urban Development Secretary Shaun Donovan is an 

advocate of improving the quality of housing projects in the United 

States. Why didn’t HUD find this money in their $47.2 billion 

budget through effective budget management or additional requests? I do not know the answer to that, but that would have 

seemed to have been a more likely way to do this. 

But another way to help solve the problem is to unleash the free 

market on housing. Taking a page from President Reagan and the 

Democratic majority playbook, we could use fiscal policy to increase 

the supply of clean, affordable housing by offering accelerated depreciation deductions on multifamily housing. This will increase 

the supply of housing without having to go through the housing authorities per se and not-for-profits, and it would actually increase 

the supply again of livable housing, which some cities are woefully 

short on. 

The Reagan/Democratic congressional approach—known as the 

Kemp-Roth Economic Recovery Tax Act of 1981—was put in to increase depreciation deductions on multifamily housing using the 

Accelerated Cost Recovery System. Under this legislation, all property was depreciable for tax purposes over 15 years, and for lowincome housing, 200 percent declining balance depreciation was 

available. Furthermore, rehabilitation expenditures for low-income 
12 

housing could be amortized over 5 years. The act worked so well 

that it was amended in 1986 with the follow-up act. 

We could once again use fiscal policy to help solve the public 

housing problem. I would prefer this approach to smaller allocations of capital in trying to get to this. 

To be sure, such legislation would create additional deficits, but 

the stimulative effects to the economy and the distressed neighborhoods could be greater than the lost tax income received by the 

Federal Government. 

Now, recently, Bank of America announced a ‘‘Mortgage to 

Lease’’ trial program to avoid foreclosure and yet another property 

going into REO and out in the already flooded market. This proposal will keep homeowners in their current home but switch them 

to renters. It is a way to stabilize neighborhoods hit by the foreclosure crisis and curtail neighborhood blight by keeping a portion 

of the properties off the market. 

Again, I appreciate the other aspects of the Choice Neighborhoods legislation that have been discussed so far. There are other 

ways we can help in the total crisis. So I would just advocate this 

is not big enough. We need something bigger, a bigger hammer to 

solve the problem. 

Thank you for the opportunity to testify. 

Senator MENENDEZ. Thank you, Dr. Sanders. I can see you are 

originally from Jersey as well. 

Mr. Weech. 

STATEMENT OF PAUL N. WEECH, EXECUTIVE VICE PRESIDENT 

FOR POLICY AND MEMBER ENGAGEMENT, HOUSING PARTNERSHIP NETWORK 

Mr. WEECH. Mr. Chairman, thank you, And on a personal note, 

thank you so much for letting me come testify today. As a former 

staffer of this Committee, I spent an awful lot of time on the dais 

up there behind you, and I had the privilege to sit at this table several times during markups of housing legislation. But it is the first 

time I have gotten to be here as a witness, and I really on a very 

personal level think that is—I am tickled. 

Anyways, I am honored to be here today with you to represent 

the Housing—— 

Senator MENENDEZ. I hope you feel that way at the end of the 

hearing. 

[Laughter.] 

Mr. WEECH. Be nice. 

Senator MENENDEZ. I am always nice to former staffers. 

Mr. WEECH. Good. Thank you. Thank you. 

I am honored to be here representing the Housing Partnership 

Network today and also to discuss the Choice Neighborhoods Initiative. 

The Housing Partnership Network is a member-driven collaborative of about 99 entrepreneurial nonprofits from all across the 

country that build, manage, and finance affordable housing. Our 

members include lenders, single-family and multi-family developers, property owners and managers, and housing counselors. 

Mr. Chairman, on behalf of the network, I want to strongly support S. 624, the Choice Neighborhoods Initiative Act. I urge this 
13 

Committee to report the bill to the full Senate at your earliest possible convenience. 

My main message today is to voice my strong support for the role 

of nonprofits in the Choice Neighborhoods process as reflected in 

your bill. Too often, when people hear the word ‘‘nonprofit,’’ it conjures up an image of a small office staffed by highly motivated, 

well-meaning people working hard to make a difference. Unfortunately, the nonprofit image also conjures up a picture of an organization that does not have a lot of financial and operating capacity. 

In fact, as outlined in my written testimony, the membership of the 

Housing Partnership Network includes some of the strongest nonprofit developers in the country, many of whom have worked side 

by side with the public housing community on HOPE VI projects 

and several of whom are already involved in Choice Neighborhoods 

implementation and planning grants. 

As nonprofits, our members are aligned with the public sector 

and its mission goals. Our members care about community impacts 

and are dedicated to positive outcomes for the residents. At the 

same time, the network members are operating like business enterprises, bringing good business practices and efficiency to complicated development efforts. 

I would also like to applaud the expansion of Choice Neighborhoods to allow the redevelopment of both private and public housing. Whether distressed real estate is publicly owned or privately 

owned, it has the same negative effects on the people in the communities in which it is located. In fact, I would argue that we jettison artificial division in the program between publicly owned and 

privately owned housing. All Choice Neighborhoods programs 

should compete based on the strength and experience of the developer, on the quality of the partnerships committed to the development, on the ability to leverage other private resources, and on the 

outcomes for the residents. In an open competition, the very best 

projects will rise to the top, and the Federal Government will maximize its social return on investment. 

Choice Neighborhoods improves on HOPE VI by requiring and 

promoting greater linkages to the other systems that make a community successful. A successful community includes good schools, 

accessible health care, basic retail services like grocery stores, and 

access to transportation that connects residents to jobs. 

The Administration deserves significant credit for its work to 

break down the silos that divide the Federal agencies, and the effort to connect this housing with opportunity is also a place where 

Congress could do more to support these efforts, and your bill goes 

a long way there, Senator. 

Finally, I would like to comment on how important it is to enact 

the authorization. The lack of permanent authorization makes the 

future development environment uncertain. Real estate development requires extensive planning activities and a long lead time. 

Acquiring property and holding it is expensive. 

Choice Neighborhoods developments will have an even longer 

lead time as developers assemble and formalize new partnerships 

across multiple disciplines. When the program funding and rules 

are institutionalized, more strong players will step up to the plate 

to participate. 
14 

In closing, Mr. Chairman, I would like to reiterate how important the work you are doing is for America’s urban, suburban, and 

rural communities. In all kinds of places, federally assisted properties have fallen into distress for any of a variety of reasons: the 

natural aging of the assets, inadequate funding, overleveraging, a 

change in market conditions, a change in tenancy sometimes, and 

poor property management. Whatever the cause, these properties 

have had a negative effect on their residents and the surrounding 

communities. The blight at the center of the neighborhood can keep 

people from buying homes nearby and can prevent new investment 

from coming in. A public investment like Choice Neighborhoods can 

change the negative market dynamic and send the community and, 

more importantly, the lives of the people who live in those communities on a positive upward trajectory. 

Thank you. 

Senator MENENDEZ. Thank you very much. 

Mr. Perry. 

STATEMENT OF EGBERT L.J. PERRY, CHAIRMAN AND CHIEF 

EXECUTIVE OFFICER, THE INTEGRAL GROUP LLC 

Mr. PERRY. Thank you, Mr. Chairman. I am honored to have the 

opportunity to be in front of you today to speak in support of Senate bill 624, the Choice Neighborhoods Initiative, which we do believe is a new model for community development. 

This initiative would help to transform distressed neighborhoods 

and public and assisted projects into viable and sustainable mixedincome neighborhoods by linking improvements with appropriate 

services, schools, public assets, transportation, and access to jobs. 

My support comes not only as a result of my obvious appreciation 

for the tremendous benefits that would accrue from a public policy 

perspective, but also as a private practitioner in the real estate 

field. 

My firm is 20-years old, and we have been involved in a number 

of HOPE VI projects across the country, as well as other affordable 

developments, including projects here in the Nation’s capital, Baltimore, and Atlanta, which is our headquarters. 

Now, unlike a lot of real estate firms, we are involved both as 

commercial real estate developers as well as community developers. 

If you think of commercial real estate development as focused on 

transactions and, therefore, intent on maximizing the returns to 

the investors and other partners, think instead of community development as more transformation as opposed to transactional— 

transformational because it calls for the intersection between public policy and private enterprise, which in and of itself is a very difficult one to take, and especially for those of us in the private sector, and that has given rise to the importance of public-private 

partnerships. 

It also means that the goals we seek to achieve are both hard 

and soft—hard in the sense that you are trying to achieve economic 

returns that make sense for the capital invested, but soft because 

you are also trying to address the human condition, which is a 

much more challenging undertaking. 

This was the problem that the best HOPE VI developments tried 

to achieve—this was the solution they were trying to achieve and 
15 

this was the problem they were trying to undertake. And so from 

our perspective, we seek to do one thing very important with the 

Federal dollars: it is to leverage those dollars as much as possible 

to attract other local public funds as well as private debt and equity capital in order to achieve something that would not be possible if left up to the pure marketplace, but at the same time we 

are trying to work as hard as we can to restore the market forces 

so that the private marketplace will carry the development the rest 

of the way. Otherwise, you would be intent on looking for unending 

sources of public subsidy. 

Now, I spoke about our prior HOPE VI development experience, 

and I want to cite one example that I think is indicative of what 

Choice Neighborhoods intends to build on and will do things that 

in HOPE VI were nice to have that now will become pretty much 

mandatory under Choice. Those things are, in the case of HOPE 

VI, it was possible to successfully do a HOPE VI development and 

take on a housing challenge, and a housing challenge only. You 

could not do that under Choice. You could not respond and be received favorably without having addressed education and some of 

the other initiatives that are important to create what we call 

‘‘quality-of-life infrastructure.’’ 

And so if you think about it, in this development we took on a 

project that was the first public housing project in the United 

States, Techwood Homes, and a picture of Techwood shows 1,100 

housing units, household income $4,300 per year, and all of that 

was not earned income; a crime rate that was 35 times the average 

crime rate across the city; and if that was not enough, a captive 

elementary school right in the heart of the development that ensured that we were destroying the next generation. 

So we created a set of shared goals between our firm and the Atlanta Housing Authority, and those shared goals reflected the priorities of the authority as well as the priorities of the private development partner to create something that was truly transformational. I will tell you it was heroic work in the sense that it 

took a lot of heavy lifting and partnerships that were nice to have 

under HOPE VI but were not required. It was a successful development, but in the final analysis, it was extremely difficult, and we 

think that Choice Neighborhoods as an initiative offers the opportunity to make those things so much easier and encourage the collaboration to take place at the front end. 

The people who speak adversely about Choice Neighborhoods 

really have not spoken to people on the ground, whether that is 

city governments that see the tax rolls swelling as a result of this 

leveraged investment and this revitalization or the families that 

have benefited from this. 

So I strongly encourage and support the bill and encourage you 

to do so as well. Thank you, Mr. Chairman. 

Senator MENENDEZ. Thank you very much. Thank you all for 

your testimony. Let me flesh out a few more things with you all 

so we can more fully develop the record. 

Dr. Sanders, I do not believe your testimony disagrees with the 

need to address public and private distressed housing across the 

Nation, right? Am I correct in that assessment? 

Mr. SANDERS. You are correct. 
16 

Senator MENENDEZ. And it seems to me that the other housing 

solutions you cite such as increasing depreciation deductions on 

multi-family housing and the Bank of America’s mortgage-to-lease 

programs are probably good ideas. 

Mr. SANDERS. Yes, they are supplemental. 

Senator MENENDEZ. But they do not really—but my concern is 

that they do not really deal with what to do about distressed public 

and HUD-assisted housing. So my sense from your testimony—I 

am just trying to get the synthesis here—is that you basically have 

a view that this is just too small to be consequential. 

Mr. SANDERS. It is not big enough. 

Senator MENENDEZ. OK. 

Mr. SANDERS. May I add something else, Senator? 

Senator MENENDEZ. Surely. 

Mr. SANDERS. When they were first doing HAMP over at the Administration, I met with Treasury and I saw what their proposal 

was for HAMP on the housing side, and my proposal said, ‘‘This 

is way too small. You are trying to put out a fire with a glass of 

water.’’ So sometimes these proposals just end up being very modest, and they could be big. Again, Stanford University spent this 

amount just on two buildings. So yes, this is not big enough. 

Senator MENENDEZ. And so the response to that would be if we 

were to do nothing, even the suggestions that you have, which I 

personally agree with but do not deal with the distressed public 

housing market or public assisted market, would have no impetus. 

And I just think that the leveraging that Secretary Henriquez suggested has happened is worthy beyond the dollars, but I see your 

point, and certainly we would love it to be more robust, but we 

need to start—from my perspective we need to start somewhere. 

Let me ask you, Ms. Maio, in your view how does Choice Neighborhoods in your own experience—and Jersey City is a great place 

because it has been the beneficiary of both HOPE VI projects as 

well as the planning on Choice Neighborhoods. How does it differ 

from HOPE VI in your experience on the ground in Jersey City? 

Ms. MAIO. We are in the middle of a planning grant, and as I 

indicated preparing a Choice Implementation Grant application, 

and I hope I do not offend anybody by saying this, I think Choice 

is HOPE VI on steroids. It is basically the notion of looking way 

beyond just the public housing site and the notion of looking even 

beyond the benefits to just public housing residents. It is bringing 

so many more entities to the table. It is bringing the private developers, the not-for-profits, the board of education, I mean, the list 

goes on and on and on. And that is why I agree with the Assistant 

Secretary. The planning process, doing all of this up front—and I 

think that is where Mr. Perry was going. All the work that has to 

be done up front to coordinate all these entities, to come up with 

a plan that we all agree with. 

I will tell you a little story that as part of this planning process 

we have to have community meetings, not just with public housing 

but all the stakeholders in the neighborhood. We had a meeting a 

week and a half ago. They applauded us. I have never been applauded. 

[Laughter.] 
17 

Ms. MAIO. That was a first. Typically, when you implement a 

HOPE VI program, because of the relocation and the negativity associated with that, it brings out things, you know, in terms of difficulties with families relocating. The issues of mental health, that 

is a grave issue. I could not agree with Dr. Popkin more on that. 

I think now that Choice will give us an opportunity to collaborate 

with partners that we never dealt with. We are partnering with the 

Pre-Natal Consortium. I know Choice talks about cradle to college. 

We are talking about prenatal. We are talking about even before 

the child is born and what are the implications for the mother’s 

health, the implications then for the child’s health. 

The board of education, the charter school—we have the charter 

school and a pre-K now working together using combined spaces. 

So making those new connections, making the connections that 

were already there, and bringing us to the table as a convener. We 

in the public sector have spent our lives convening meetings, sometimes positive, sometimes not, but we are used to that give and 

take. We are used to meetings where people have criticisms as well 

as accolades for us. And being able to put all that together so 

that—one of the gentlemen said, this is not a plan, this is a vision, 

and I think that is what we want to talk about. This is much bigger than HOPE VI. 

I hope I have answered your question. 

Senator MENENDEZ. Actually, you answered my follow-up as well. 

[Laughter.] 

Ms. MAIO. I am from Jersey. 

Senator MENENDEZ. Invite me to your next Choice Neighborhoods planning session so that I can share your process. 

Let me ask you, Dr. Popkin, you mentioned that HOPE VI was 

less successful in helping families improve their economic conditions, including persistently low levels of employment and poor 

health conditions. How do you think the Choice Neighborhoods 

model incorporates methods to address the deficiencies that HOPE 

VI had? Or maybe deficiencies—well, I do not know. Maybe it did 

not meet all of the aspirations we would have had of HOPE VI. 

Ms. POPKIN. I think HOPE VI was really a housing intervention 

with the hope that moving people somewhere else would have all 

these other benefits for families. I think the research we have done 

shows it is much harder to move those kinds of outcomes for people 

who have been very disconnected from the labor market and are 

very sick, dimensions. So I think the kind of work we have done 

over the past few years where we have worked on using housing 

as a platform for services, integrating services in a coordinated way 

into a housing redevelopment shows a lot of promise, and that is 

the only time in any of the research I have done I have seen the 

employment numbers move or the health numbers stop getting 

worse. 

So I think that kind of effort to really integrate and coordinate, 

like Ms. Maio is talking about, holds a lot of promise. 

Senator MENENDEZ. And if you were to synthesize for me—I 

mean, you did some of this in your testimony. What are some of 

the most important outcomes of your extensive study? If you were 

to highlight it for me, what would you say? 

Ms. POPKIN. Of integrating services? 
18 

Senator MENENDEZ. Yes. 

Ms. POPKIN. We saw employment numbers rise. In all the years 

I have been tracking people through HOPE VI and through the 

Moving to Opportunity demonstration, I have never seen the employment change. So with an intensive transitional jobs program, 

even in the worst labor market in memory, we saw employment increase for the participants. We are following up this year to see if 

that was sustained after the services were done. 

We saw people’s health ratings stabilize, and the main reasons 

for that seem to be the regular contact with case managers and 

some reduction in substance abuse. And, again, I have never seen 

health improvement in any of the research we have done. I have 

only seen it get worse as people get older. 

What we did not see were any benefits trickling down to the 

kids, and that I think is a major concern. There is a lot of hope 

with the case management strategy that if you could improve maternal depression, for example, you will see kids’ outcomes improve, 

and we did not see that. So the new work that we are doing is really very intentionally incorporating services for children and youth. 

You said prenatal, but really intensively targeted case management 

for kids, outreach to families to get very little kids enrolled in early 

childhood programs, and we are in the midst of that evaluation so 

I cannot tell you if it is working yet, but we are hoping we will see 

some movement on those outcomes. 

Senator MENENDEZ. Well, that is interesting because it seems to 

me that, of course, in the first instance, what we were trying to do 

with HOPE is stop the warehousing of people and creating senses 

of community, but there were other elements, and it seems that 

some of them were moving in the right direction. I am hoping that 

Choice Neighborhoods can go beyond that. 

Mr. Weech, you talked in your testimony about silos that divide 

Federal agencies, and certainly my bill works to try to break those 

silos down. But you suggest that more can be done. Can you give 

me some sense of what you think might be able to be done? 

Mr. WEECH. Yes, it is interesting. I thought of that, Senator, before I came because obviously there is some great stuff happening 

through the partnerships on the ground. You are getting better coordination at the local level between the housing developers and 

the other providers who service the schools, and Choice Neighborhoods is really driving some nice new partnerships. But it still 

means having to access the different delivery systems from the 

Federal Government. 

Now, this Administration deserves a lot of credit. They have been 

doing terrific kind of on the administrative level of trying to coordinate better with the other agencies and the grant programs. Things 

that we might consider that would be more aggressive would be requiring joint NOFAs and single applications that get sent to all of 

the Federal agencies involved and make it much easier for the applicants, say, on a Choice Neighborhoods application to have assurances of these other dollars flowing into their projects and cementing the partnerships on the ground. 

Senator MENENDEZ. And you talked about well-managed affordable housing as a platform for a wider array of positive social outcomes. How can the Choice Neighborhoods serve as that platform? 
19 

And what types of specific outcomes for residents do you envision 

possibly resulting from it? 

Mr. WEECH. Well, rolling back the tape, you know, all of the nonprofit property managers in my organization are trying to bring 

resident services to the people that they are serving, and the biggest challenge for them is really kind of the consistency of those 

funding streams. It is an annual grant-writing process, it is fundraisers, and it is a big challenge on services. 

What Choice Neighborhoods is doing, what your bill does in the 

planning process and in the implementation process, is it is really 

starting to get those funding streams more closely aligned and 

working together. And so, you know, I am hoping that Dr. Popkin 

can back us up on this, but we see already with the redevelopment 

process better outcomes in terms of public safety and people’s sense 

of well-being, people are sleeping at night, and by carrying these 

linkages to these more intensive services, we would like to hope 

that you have better educational outcomes for the kids, better job 

opportunities for the residents, and better health outcomes. 

Senator MENENDEZ. Mr. Perry, I really appreciated your testimony. I think you presented an honest and sometimes taboo tidbit 

about community developers, that while you are committed to 

transformation, obviously one of your goals is to indeed make a 

profit. So my question is: How does Choice Neighborhoods help you 

balance between both of those goals—the legitimate goal of making 

a profit and at the same time some of the societal benefits? Does 

it? 

Mr. PERRY. It absolutely does, and thank you for the question. 

In fact, as a developer you are often challenged to take the long 

view because returns are not immediate. And with Choice Neighborhoods, what you are able to do is take on those kinds of things 

that I call or refer to as ‘‘quality-of-life initiatives’’ that create longterm value. When you or I decide to buy a home, if we have schoolaged kids or think we will, we certainly want a neighborhood that 

has a good school. And so in some respects, if you look at it, when 

we make that purchase, we are making an investment decision 

that has a long lifetime on it, and so developers focus on wanting 

to see real estate values go up over time, so we want to be in those 

kinds of communities. Choice allows us to take on blighting influences in the neighborhood, and by overcoming those blighting influences, market forces get restored. 

I indicated that we have done a number of HOPE VI’s, and I consider Centennial Place to be one of those, and the elements of that 

development include a brand-new K–5 math, science, and technology-themed elementary school, early childhood development centers, YMCAs, and high-quality housing were in a neighborhood anchored by two major institutions, Georgia Tech and Coca-Cola. But 

they were there when this same site, Techwood Homes, the worst 

of the worst, existed. And so it means that unless the linkages are 

intentional, well thought out, and put in place up front, you can 

still get bad outcomes. I think Choice ensures that you have to do 

that homework up front in order to submit a successful application. 

Senator MENENDEZ. Now, I think the public-private partnership 

model is critical to the success of Choice Neighborhoods, and I was 

intrigued—you mentioned four metrics that you use to measure 
20 

your ability to mitigate risk without ignoring public policy priorities. Can you share the details on the metrics that you use? Or are 

they proprietary? 

Mr. PERRY. They are not, and if they were, they are not after I 

submitted the written testimony. 

[Laughter.] 

Mr. PERRY. Certainly we have investors, lenders, and other partners that have put capital in, so we have to ensure that we provide 

at least a reasonable return. Most of the investors in those kinds 

of communities understand they are not going to make maximum 

dollars, but they at least expect a reasonable return, so that is important. 

We are doing this to help families and individuals make it into 

the next generation successfully, and so we have positive outcomes 

that we have to achieve with respect to the families that are impacted by these community rebuilding efforts. 

We are also focused on impact in the surrounding neighborhoods, 

and I will give you anecdotally—in the case of Centennial, I will 

tell you that one and a half blocks south of our site, a site that was 

suffering from just total disinvestment, we now have the largest 

aquarium in the world, a $300 million aquarium, a $200-plus million Coke museum, a complex of high-risk office buildings, condos, 

hotels, all of which together total about $2.5 billion of private investment that I would say would not have been remotely possible 

if the redevelopment effort had not been taken on. So that is impact to a surrounding neighborhood. 

And then, finally, the impact to the local jurisdiction, specifically 

now you have a site that is 60 acres that was off of the tax rolls 

that is now on the tax rolls paying significant taxes, unfortunately 

or fortunately, depending on which side of the table you are; and 

at the same time, an impact that is even broader than that site 

also contributing to those tax revenues. 

So those four are the metrics we look at to bring all of the stakeholder together to support one of these comprehensive revitalization efforts. 

Senator MENENDEZ. Very helpful. 

One final question, Mr. Weech. You said in your testimony that 

you do not believe my bill should have separate distinctions for privately owned versus publicly owned distressed housing in terms of 

grants. And while I agree with you that distressed housing has 

identical impacts on the people who live there regardless of ownership, the only thing is I remain concerned about the negative effects on the physical state of public housing throughout the country 

during a time of declining Federal and State budgets for housing 

assistance. Is that a concern that you share? 

Mr. WEECH. Absolutely, Senator, longstanding—in fact, when I 

was here on the Committee, the Commission on Distressed Public 

Housing produced its work, and the HOPE VI program came out 

of that. And part of the motivation for us on HOPE VI was to find 

a way to get the capital we needed to meet the backlog modernization needs in public housing. So as a network, we are totally supportive of a variety of strategies to recapitalize the public housing 

inventory which has been underinvested in for a long time. 
21 

I think I was making more the point that in a competitive grant 

program, it does not make sense to me to have HUD run two separate grant competitions. Most of the applicants for the Choice 

Neighborhoods grants were public housing agencies, which says to 

me that the experience they have on HOPE VI, the quality of development teams they put together, they will continue to compete 

very successfully for the grant dollars. 

Senator MENENDEZ. Well, thank you all for sharing your expertise today. I think that the Choice Neighborhoods Initiative builds 

on the bipartisan success of the HOPE VI programs and incorporates what we have tried to do, an innovative, holistic approach 

to solving the dire needs of distressed HUD-assisted housing by 

leveraging public and private resources to address not only the distressed housing but also the community blight that often surrounds 

failed housing developments. 

In my mind, Choice Neighborhoods ultimately will create jobs, 

having a ripple effect, attracting a variety of State, local, and private investment in revived communities. We have seen in the last 

year alone that Choice Neighborhoods has leveraged about $1.6 billion in private funding, and whenever we can do that, I think that 

when you can take even admittedly, as Dr. Sanders would suggest, 

a relatively small program but leverage it to $1.6 billion, that is a 

good place to be. 

I have a series of requests: the testimony of Mayor Landrieu of 

New Orleans, a letter of support from the Local Initiatives Support 

Corporation, a letter of support from the Stewards for Affordable 

Housing for the Future. I ask unanimous consent that they all be 

included in the record. Without objection, they will be. 

Senator MENENDEZ. I want to take the Chair’s prerogative to recognize a Rangel Fellow who has worked with us particularly on 

this issue and did a lot of work to make this a very successful hearing. She will be leaving us. So, Oneshia, thank you very much, 

Oneshia Herring, thank you very much for your work, and we appreciate your service. 

The record will remain open for a week from today if any Senators wish to submit questions for the record. I would ask our panelists if they do receive such questions that you answer as expeditiously as you can so we can finalize the record. This has been incredibly helpful, and with the thanks of the Committee, this hearing is adjourned. 

[Whereupon, at 11:44 a.m., the hearing was adjourned.] 

[Prepared statements, responses to written questions, and additional material supplied for the record follow:] 
22 

1http://www.economicmobility.org/assets/pdfs/PEWlNEIGHBORHOODS.pdf. 2 Holzer HJ, Schazenbach, DW, Duncan, G, and Ludwig, J (2007) The Economic Costs of Poverty in the United States: Subsequent Effects of Children Growing Up Poor. National Poverty 

Center Working Paper Series #07–04. 

PREPARED STATEMENT OF SANDRA HENRIQUEZ 

ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

MARCH 27, 2012 

Chairman Menendez, Senator DeMint and Members of the Committee, thank you 

for this opportunity to discuss the Choice Neighborhoods program. As you know, 

with your leadership, Mr. Chairman, in less than 2 years, this program has already 

had great success helping communities tackle housing distress and leveraging private dollars. Indeed, the $130 million of funding we have awarded to thirty-five 

communities through implementation and planning grants under this program has 

already leveraged a combined $1.6 billion of other investments in those neighborhoods, over 12 times their total grant award. 

Indeed, I am grateful for the leadership that you have shown, Chairman Menendez, in sponsoring legislation that will formally authorize Choice Neighborhoods. We 

are grateful as well to Chairwoman Waters for her leadership in advancing a similar effort in the House of Representatives. We want to work with Congress to authorize Choice Neighborhoods so that local leaders can count on the Federal Government as a partner in their neighborhood revitalization efforts. 

Today, I want to describe the need for authorizing Choice Neighborhoods, how it 

builds on the progress of the HOPE VI program and how it helps local leaders turn 

around distressed neighborhoods that are critical to helping regional economies rebound as our national economy is growing. 

Background 

Indeed, Mr. Chairman, in many ways we meet at an encouraging moment: when 

our economy is growing, jobs are being created and foreclosures are down. We’ve 

added private sector jobs for two straight years, for a total of over 3.9 million jobs. 

In the last year, 2.2 million private sector jobs were added—and we’ve added more 

jobs in the last 6 months than any 6-month period in nearly 6 years. Indeed, in 

many cities, the tide is turning—unemployment is dropping, vacancy rates are improving, and investment is going up—but certain neighborhoods remain stubbornly 

resistant to change. 

Even still, as local leaders dig their communities out of the worst recession since 

the Great Depression, we recognize that the cost of poverty, particularly concentrated poverty, to our society and to our economic future is very high. Today, 

more than 10 million people live in neighborhoods of concentrated poverty—surrounded by disinvestment, failing schools, troubled housing, and, worst of all, virtually no path to opportunity for themselves or their children. 

In fact, research shows that one of the most important factors in determining 

whether or not children will do better financially than their parents is whether or 

not they grow up in one of these high-poverty neighborhoods.1 We can predict 

health, economic, and educational outcomes of children based on zip code. Further, 

a conservative estimate finds that allowing millions of children to grow up in poverty costs the United States more than $500 billion per year, or more than 4 percent 

of GDP.2

In a globalized information economy, where a country’s success is built on its 

human capital development, the conditions of our highest-poverty neighborhoods, 

among other factors, are preventing children from taking advantage of educational 

opportunities and building the skills they need. We must revitalize America’s highpoverty neighborhoods in order to educate our way to economic success. 

Connected Challenges: Distressed Housing and Neighborhoods 

That’s why this Administration has pursued Choice Neighborhoods, which builds 

on the HOPE VI public housing revitalization program pioneered by my predecessors at HUD, Secretaries Jack Kemp and Henry Cisneros. 

With strong bipartisan support, HOPE VI has already created over 90,000 public 

housing units in healthy, mixed-income communities that were once troubled by distressed public housing—leveraging twice the Federal investment in additional private development capital and contributing to an increase of 75 percent or more in 

the average income of residents in such communities. This increase might partially 

result from higher-income residents moving into the area. 
23 

Why Choice Neighborhoods?—In 1994, the media spotlight briefly focused 

on the nightmarish conditions in one Washington DC neighborhood’s large, 

distressed housing developments—Frederick Douglass, Stanton Dwellings, 

Parkside Terrace and Wheeler Terrace. To quote a report commissioned by 

Secretary Cisneros, Washington Highlands presented a ‘‘worst-case situation’’ for HUD. As the report stated, ‘‘two separate and distinct HUD program areas.[were] alleged to be contributing to the deterioration’’ of the 

neighborhood—public housing and Project-based Section 8. 

Thanks to HOPE VI, local and national nonprofits, the DC government and 

private developers had ready access to a program to develop the public 

housing properties—and had secured other financing to build a new community center, elementary school, public library, and a parks and recreation facility. But the challenge didn’t end there, because the two other 

housing developments in Washington Highlands didn’t qualify for HOPE VI 

funding, simply because they were subsidized by different programs at 

HUD. 

The media didn’t make the distinction. The residents didn’t make the distinction. Gangs and drug dealers certainly didn’t make the distinction. And 

thankfully, the community leaders who were fighting to turn the neighborhood around didn’t make the distinction either. The only one to make the 

distinction was HUD. 

Choice Neighborhoods builds on HOPE VI by recognizing that the problem of high 

concentrations of distressed housing in a single neighborhood of concentrated poverty is not limited to public housing. 

Indeed, many communities are struggling with the challenge of distressed housing 

in severely declining neighborhoods. The financial crisis intensified and expanded 

disinvestment in these neighborhoods, causing spillover effects in surrounding 

areas—an impact that is felt particularly strongly in neighborhoods with a large 

amount of distressed HUD-subsidized housing, whether public housing or assisted 

housing. 

We have heard from Public Housing Authority executive directors, mayors, and 

other leaders across the country that they need a tool that is sufficiently catalytic 

to revitalize these neighborhoods, and get their cities headed in the right direction. 

Existing funding sources like CDBG, HOME, LIHTC, and the Rental Assistance 

Demonstration can address some symptoms, but are simply not catalytic or substantial enough to effectively restore high-need neighborhoods. Choice Neighborhoods is 

exactly the kind of tool that those local leaders are asking for, and it is currently 

helping change the trajectories of cities across the country. 

Building upon HOPE VI by expanding beyond public housing to include other, almost indistinguishable HUD-assisted housing, Choice Neighborhoods transforms destabilizing, distressed housing into mixed-income and professionally managed housing. But Choice Neighborhoods also provides the flexibility that local leaders need 

to address their specific challenges, whether it’s a need to improve neighborhood infrastructure, or ensure high-quality early learning opportunities are available for 

young children. Choice Neighborhoods attracts and leverages private investment, 

philanthropic funding, and other public investments, to strategically address these 

challenges. The first five Choice Neighborhoods Implementation Grantees have used 

their $122 million of funding to leverage a combined $1.6 billion, over 13 times their 

total grant award. And the 30 additional grantees who have received funding to 

spur their plans and preparations for Choice Neighborhoods revitalization have used 

their $7.6 million of awarded funding to leverage $13 million in other funds. 

Additionally, in part because of rural set-asides, Choice Neighborhoods is restoring neighborhoods in smaller cities and towns, which are experiencing challenges 

similar to those in larger metropolitan areas. In towns in rural areas like Meridian, 

MS and Salisbury, NC and small cities like Opa-Locka, FL local leaders are using 

Choice Neighborhoods to form and implement their own solutions to regenerate opportunities and their economies. 

In short, over the last two decades, HUD made significant strides in reducing the 

amount of severely distressed public housing through the HOPE VI program, which, 

once all funds are expended, will have replaced a total of over 100,000 public housing units that were formerly part of some of the most distressed housing stock. 

However, this work is not finished—in part because HOPE VI didn’t address the 

most distressed HUD Assisted Housing, which Choice Neighborhoods tackles head 

on. In order to revitalize neighborhoods with large stocks of distressed HUD-assisted 
24 

3Turner, et al. (2007). Estimating the Public Costs and Benefits of HOPE VI Investments: 

Methodological Report. The Urban Institute. 4Zielenbach and Voith. (2010). HOPE VI and Neighborhood Economic Development: The Importance of Local Market Dynamics’’. Cityscape. 12, No. 1: 99–131. 5Turbov and Piper. (2005). HOPE VI and Mixed-Finance Redevelopments: A Catalyst for 

Neighborhood Renewal. Washington, DC: Brookings Institution. Vol 8.; From Despair to Hope: 

Hope VI and the New Promise of Public Housing in America’s Cities. (2009). 6Zielenbach and Voith. (2010). 

7Turner, et al.(2007). 

housing, and provide local leaders with the flexible, catalytic tool they need, we 

must build on the success we’re already seeing through Choice Neighborhoods. 

Grantee Spotlight: Salisbury, NC—Salisbury is a small town in a rural area 

of Eastern North Carolina. As a direct result of Choice Neighborhoods, the 

Housing Authority and city of Salisbury have partnered to create a Transformation Plan targeting the West End neighborhood and Civic Park Apartments, a 72-unit public housing complex within West End. Civic Park 

Apartments suffers from failing building structure, water infiltration and 

substandard electrical systems. The City considers West End its most distressed neighborhood, with a poverty rate of 28 percent, a neighborhood vacancy rate that is nearly five times the County average, and a low-performing middle school. Through their Planning Grant, the Housing Authority and the City will work with a nationally recognized planning firm, 

Stogner Architecture, to develop an actionable local plan for coordinated investment. They will conduct a locally based needs assessment, continue to 

partner and build their capacity, and create plans for rehabilitating the 

neighborhood’s public and assisted housing stock, developing an early childhood education center, and supporting existing neighborhood assets. 

Catalyzing Recovery by Targeting Housing and Neighborhoods 

Because of the interconnections between housing and the health and economies 

of neighborhoods, high-poverty neighborhoods with severely distressed HUD-assisted housing are strong candidates for return on Federal investment. Moreover, 

like other infrastructure, investments in housing last over the life-cycle of the improvements and generate long-term payoffs to neighborhoods and local economies. 

Under HOPE VI, Choice Neighborhoods’ predecessor, we saw that removing 

blighted public housing and replacing it with economically sustainable, mixed-income housing, not only replaced severely distressed housing, but also reduced poverty, crime, and unemployment; increased income and property values; and triggered investment, business growth, and local jobs. 

A typical 700-unit redevelopment of distressed public housing boosts home values, 

and generates local revenues of $6.5 million over a 20-year period.3 A recent study 

looking at four sites estimated that three out of the four investments directly increased the surrounding areas’ home values by a total of $14 million to $107 million. 

Home values in the fourth site kept pace with the rapid increases in the local area.4

Increased home values not only highlight how targeted Federal investments can 

improve the surrounding area, but also show the enormous potential that these investments have to unlock private sector demand for and investment in these neighborhoods. 

Removing isolated, distressed properties and creating communities with connected, defensible spaces also contribute to decreased crime. Drops were especially 

large when this work was done in concert with police. For example, in Centennial 

Place in Atlanta, GA, the site of one project where fellow panelist Egbert Perry led 

so much great work, crime dropped by an astonishing 93 percent.5 These drops in 

crime have often been much larger than those in other comparable local neighborhoods, and can generate significant savings over the life-cycle of the housing.6,7

Grantee Spotlight: San Antonio, TX—The San Antonio Housing Authority, 

the local United Way, and their partners have secured both a Choice Neighborhoods Planning Grant and a Promise Neighborhoods Planning Grant for 

the Eastside area. The Eastside neighborhood is held back by several interconnected problems. The neighborhood vacancy rate is more than three 

times the County rate and almost half of the area’s residents live in poverty. In addition to distressed public housing, the neighborhood also strug-
25 

gles with very low performing schools, including the Sam Houston High 

School where more than half of all students drop out. The Housing Authority recognizes that, even if the housing is replaced, market rate renters will 

not move into the area without better schools. As a result of these aligned 

Federal investments, the Housing Authority, United Way, the City, a local 

university, and their partners are building on new city efforts and private 

industry growth and are crafting an integrated, data-driven plan that links 

educational improvements to mixed income housing and neighborhood revitalization. 

Targeted investments in housing also create jobs through construction related 

work and multiplier effects. Federal investment, combined with the massive private 

sector leverage that these investments marshal, translate into substantial numbers 

of new jobs, further contributing to the re-growth of these local economies. Meanwhile, the continued return of private investment in homes, businesses, and other 

infrastructure propels this cycle of increased jobs and growth. At its core, Choice 

Neighborhoods is a job-generator: directly creating jobs through its investments, and 

indirectly creating the conditions for private capital—and work—to flow back into 

disinvested neighborhoods. We estimate that the Choice Neighborhoods grants 

awarded thus far and combined leveraging will create thousands of jobs. 

Using a Proven Approach & Generating Local Solutions 

Choice Neighborhoods builds on HOPE VI successes. With HOPE VI, communities 

used financing from multiple private and public sources to remove blighted public 

housing and replaced it with sustainable mixed-income developments that cost far 

less to operate than the original, ailing housing. This approach attracted new businesses and market-rate renters and opened up opportunities for families to live in 

affordable, decent housing in safer neighborhoods. 

However, Choice Neighborhoods has significantly improved upon HOPE VI by requiring that the housing investment enable and align with a comprehensive locally 

driven neighborhood plan. Local leaders, often including local elected officials and 

city staff, begin by assessing the needs in their neighborhood, then craft a plan that 

is responsive to those needs, and rooted in effective, evidence-based practices. Choice 

Neighborhoods provides them with the flexibility and resources to execute on those 

locally driven plans. 

Choice Neighborhoods was designed to ensure leaders could carry out their vision 

and respond to the specific challenges in their community. For example, under 

Choice Neighborhoods distressed housing stock is not just limited to public housing; 

often distressed public housing and other distressed HUD-assisted housing is located side by side. Now, both types of housing are eligible to be the focus of a grant, 

giving local leaders a tool to address whichever types of HUD-assisted housing 

present challenges in their communities. 

Grantee Spotlight: Little Rock, AR—In Little Rock, AR, a struggling neighborhood just Southeast of the downtown area is being challenged by both 

a severely distressed 74-unit public housing development, Sunset Terrace, 

and a severely distressed 50-unit HUD-assisted, Project-Based Section 8 development, Elm Street. Both properties have deteriorating foundations and 

structures, have persistent electrical and plumbing problems, lack defensible spaces, and have other serious design flaws. The surrounding neighborhood is affected by high crime, poor schools, and has a vacancy rate that 

is over three times the county rate. To address these needs, the Little Rock 

Housing Authority has partnered with Volunteers of America National 

Services, the owner of the Project-Based Section 8 development, to engage 

City and civic leaders in turning around the neighborhood. They have secured a Choice Neighborhoods Planning Grant and are working with 

Quadel Consulting to create a plan that builds off of other recent development efforts, including the Department of Education’s Promise Neighborhood Program, Neighborhood Stabilization investments, and HUD’s Sustainable Communities Initiative. 

Local leaders also need to be able to address the specific challenges in these 

neighborhoods when it is not just the housing that needs fixing. Data show that 

market rate rental and homeownership demand in a neighborhood is driven by the 

quality of the institutions and assets in that area, such as schools, grocery stores, 
26 

8Weissbourd, Bodini, and He. (2009). Dynamic Neighborhoods: New Tools for Community and 

Economic Development. Living Cities. 

parks, public safety, access to transportation, and proximity to jobs and businesses. 

Improvements to these assets create the conditions for neighborhood change.8

Choice Neighborhoods makes it easier to make this happen. Choice Neighborhoods 

provides a framework that recognizes the effective practice of pairing housing revitalization with a broad intervention in a target neighborhood. And critically, Choice 

Neighborhoods provides the flexibility needed to bring in the public and private 

partnerships that will catalyze these changes. The program allows local leaders to 

use up to 15 percent of the grant to focus on human development-related investments in early education, job training, health, and other areas. Choice Neighborhoods also allows 15 percent of funds to be used for critical neighborhood improvements, like providing gap financing for grocery stores, financial institutions, and 

other retail, and removing blight caused by vacant private housing. When communities can’t otherwise access sources of funds to address critical needs, these gapfilling funds represent ‘‘glue money’’ that garner new leverage and hold together key 

strategies. 

Choice Neighborhoods also enhances local flexibility by enabling the best-poised 

leader to drive this process. Under HOPE VI, only housing authorities could apply 

for grants. This limitation sometimes left other key players out of the process, making it far too easy to miss opportunities to streamline local efforts and leverage the 

greatest return on an investment. Choice Neighborhoods now encourages the highest capacity and best situated applicant, whether a mayor or other local officials, 

public housing authority, nonprofit, tribal entity, or private developers to directly 

apply for a grant. 

Grantee Spotlight: San Francisco, CA—McCormack Baron Salazar, a private development company, and the San Francisco Housing Authority, 

along with partners like Lennar Homes (a publicly traded real estate development company), the City, School District, and Urban Strategies were 

awarded a Choice Neighborhoods Implementation Grant to execute their 

local vision for the Eastern Bayview neighborhood. Forty percent of Eastern 

Bayview residents live in poverty and the neighborhood suffers from high 

vacancies, poor schools, and inadequate access to job centers in downtown 

and Silicon Valley. The neighborhood also contains the Alice Griffith public 

housing site, a highly distressed collection of barracks style housing scattered over a 22-acre site. Through their Choice Neighborhoods grant, the 

team will build a total of 1,210 mixed-income units, replacing the 256 units 

of public housing and creating a new master-planned community with market-rate and workforce housing. The team has also identified a clear plan 

and goals to address their local needs. They are building upon the San 

Francisco Unified School District’s progress to improve the quality of their 

schools and develop complementary educational opportunities. They have 

also set employment targets and are working with the Job Readiness Initiative and the local Citybuild program to provide job training and placement. 

Additionally, the team is bringing in needed everyday services and jobs by 

improving streetscapes to attract retail, removing blighted housing, and 

pursuing new commercial assets, fresh food stores, and a new bus rapid 

transit with direct connections to key commuter rail lines. 

Demonstrating Capacity & Leveraging Investments 

Choice Neighborhoods establishes a high bar for grantees. The program is a highly competitive grant program. In the first year alone, HUD received over 160 applications but awarded only 22 grants. 

These grants require local leaders to demonstrate that they have a solid, high 

quality plan and the capacity needed to carry it out. Local leaders must use evidence-based practices and real-time results to inform their work. Additionally, many 

of the Choice Neighborhoods Implementation Grantees have been working with 

these communities for years and have strong partnerships with organizations that 

have successfully revitalized neighborhoods. For example, in New Orleans, the 

Housing Authority and City are working closely with McCormack Baron Salazar, a 

private development group that has been involved in turning-around neighborhoods 

across the country, as well as Urban Strategies, a nonprofit group that has successfully convened local partners and aligned their revitalization efforts. 
27 

Local leaders can’t succeed in turning around disinvested neighborhoods without 

securing necessary partnerships and highly leveraging their investments. For this 

reason, Choice Neighborhoods reserves a substantial number of points in its competitive process for those applicants who have secured leverage far above their grant 

amount and who demonstrate that they are aligning their work with existing efforts, thereby streamlining resources and achieving greater efficiencies. This approach rewards leaders who are breaking through silos and working with public and 

private agencies, such as school districts and police, major market actors like private real estate developers, and anchor institutions like universities and hospitals. 

As a result, the five Choice Neighborhoods Implementation Grantees have leveraged 

a combined $1.6 billion, over 13 times their total grant award. This total includes 

new, refocused, and streamlined funds from private investors, cities, universities, 

foundations, and a range of local partners. Even Choice Neighborhoods Planning 

Grants that amount to only $250,000 to $300,000 for each neighborhood have pulled 

in substantial amount of leverage. During the past 2 years, Planning Grantees have 

leveraged over $13 million in planning funds alone to add to the $8 million they 

received in Choice Neighborhoods grants. 

Grantee Spotlight: New Orleans, LA—In New Orleans, Choice Neighborhoods will spur the revitalization of the Iberville/Treme neighborhood, 

where 52 percent of families live in poverty, with a plan centered on the 

transformation of distressed, highly concentrated public housing into mixedincome housing that preserves the historic character of the neighborhood. 

The partnership, led by the city of New Orleans and its Housing Authority, 

will take advantage of the neighborhood’s adjacency to the French Quarter, 

bringing back the streetcar named Desire, and expanding the reach of New 

Orleans’ strong tourism economy to include the musical and cultural heart 

of Treme. The project will replace 821 units of public housing in a new, 

mixed-income neighborhood, with over 2,400 total units being built. A new 

hospital, clinic, and biomedical research facility, tied to integrated job training, will create critical employment opportunities for neighborhood residents and expand access to needed health care. And through the Choice 

Neighborhoods partnership with the Recovery School District, Louisiana’s 

fastest-improving school district, children growing up in the neighborhood 

will have access to quality educational opportunities. All of this work is 

aligned by a $30.5 million Choice Neighborhoods grant that leverages over 

$1 billion in private, nonprofit, and other investments into the community. 

Aligning Federal Funding so Taxpayer Dollars Go Further 

Choice Neighborhoods also offers a new way for local leaders to access Federal resources more efficiently. Because Choice Neighborhoods grants are place-based and 

driven by local solutions, HUD’s grants can now be used in concert with other Federal investments around places and local needs. 

HUD has been aligning Choice Neighborhoods investments with those from the 

Department of Education, Justice, and Health and Human Services. Both Choice 

Neighborhoods and the Department of Education’s Promise Neighborhoods, a companion program focused on transforming educational opportunities, include preferences for applicants who are coordinating these programs. The programs have also 

used some of the same measures and definitions to eliminate the need for local leaders to deal with redundant reporting requirements and implementation barriers. 

Currently, five Choice Neighborhoods Planning Grant neighborhoods have Promise 

Neighborhood Planning Grants, including communities in San Antonio, Texas, Little 

Rock, Arkansas, and Tulsa, Oklahoma. 

Additionally, the Department of Justice is aligning significant investments with Choice Neighborhood Grants. The Department of Justice has devoted $2 million of 

their resources to support the public safety strategies of Choice Neighborhoods Implementation Grantees through the Public Safety Enhancement (PSE) Initiative. 

Choice Neighborhoods Grantees have recently submitted applications for the PSE 

grants, which will fund local innovations and evidence-based solutions to decrease 

violence, gang activity, and illegal drug activity. The Department of Justice has also 

committed to aligning its upcoming $15 billion Byrne Criminal Justice Innovation 

Program with Choice Neighborhoods. 

The Department of Health and Human Services is also incentivizing alignment 

with Choice Neighborhoods. Applicants for community health center improvements 

are asked to describe how they are working with Choice Neighborhoods grantees if 

there is one in their area and receive points for those collaborations. 
28 

9See, e.g., MacArthur’s ‘‘How Housing Matters’’ series at: http://www.macfound.org/site/ 

c.lkLXJ8MQKrH/b.6547839/k.163E/HowlHousinglMatterslRecipientslbylSubject.htm# 

education. 

Finally, Choice Neighborhoods grantees are aligning substantial Federal investments at the local level. Some examples include resources from other Federal agencies such as: Department of Transportation—Seattle is leveraging $32.3 million from 

the Seattle Department of Transportation; Department of Health and Human Services—New Orleans is leveraging $962,000 from Head Start and $500,000 from a federally Qualified Health Center; and Department of Labor—Boston is leveraging 

$348,600 of Workforce Investment Act funds. The Federal Partnership for Sustainable Communities has become a key driver in helping jurisdictions target their 

neighborhood revitalization efforts and align them with larger regional plans, providing even greater leverage out of our Choice Neighborhoods investments. 

Through coordinating and co-locating these Federal resources, Federal funds 

stretch further and are more effective. For example, local leaders who improve 

schools with Promise Neighborhood grants will be better able to attract market rate 

renter families back to the area and prepare the future workforce. Likewise, we expect that students living in Choice Neighborhoods’ safe, decent, affordable housing 

will be better able to concentrate on school and achieve higher test scores, consistent 

with previous findings of the impact of safe, decent, affordable housing on educational outcomes.9

Meeting Communities Where They Are 

Choice Neighborhoods also meets communities where they are. That is why 

Choice Neighborhoods has dedicated a small, but significant portion of the overall 

allocation for Planning Grants. These Planning Grants ensure that those local leaders and communities who are not yet able to fully undertake a successful neighborhood revitalization can start down that path. By the end of their planning period 

these grantees will have developed a locally driven plan based on their needs and 

evidence-based practices, secured the necessary partnerships and leverage, and built 

their own capacity and the capacity of their partners and stakeholders so that they 

are ready to effectively implement the plan. Planning Grants also include competitive preferences for communities that could particularly benefit from these investments, such as rural communities and neighborhoods that are designated as Promise Neighborhoods. 

What Local Leaders are Telling Us 

We have heard from mayors, PHA Executive Directors, economic development directors, and other leaders across the country that they need Choice Neighborhoods 

to help unlock the potential of their most distressed neighborhoods. They need this 

tool for those neighborhoods to recover, and for their cities to recover, tapping into 

the underlying economic strength of those neighborhoods. The intensity of the challenges faced in neighborhoods that have been mired in disinvestment for decades 

is so strong, it’s only through a catalytic investment like Choice Neighborhoods that 

those cities can get them on the right track—and ensure that the kids growing up 

there can access the opportunity that every American deserves. 

And so, Mr. Chairman, Choice Neighborhoods is about attacking interconnected 

challenges with comprehensive, proven tools. It’s about understanding that local 

problems require locally driven solutions—and that the Federal Government can 

serve as an effective partner in supporting these solutions. It’s about making taxpayer dollars go as far as they can. But fundamentally, it’s about making sure every 

American gets a fair shot—whoever they are, and wherever they live. That’s what 

this program is all about—and it’s why I so appreciate this opportunity today. 

Thank you and I would be happy to answer any questions. 

PREPARED STATEMENT OF MARIA MAIO 

EXECUTIVE DIRECTOR, JERSEY CITY HOUSING AUTHORITY

MARCH 27, 2012 

Chairman Menendez, Ranking Member DeMint and Members of the Subcommittee, my name is Maria Maio and I am the Executive Director of the Jersey 

City Housing Authority (JCHA) of Jersey City, New Jersey. The JCHA is the 2nd 

largest PHA in New Jersey serving nearly 20,000 low and moderate income seniors, 

families and persons with disabilities in its Public Housing and Housing Choice 

Voucher Programs. 
29 

I greatly appreciate your invitation and am honored to be here today to testify 

before the Subcommittee regarding, ‘‘The Choice Neighborhoods Initiative: A New 

Community Development Model.’’ As you are aware, the JCHA received one of the 

first Planning Grants awarded under the Choice Neighborhoods Initiative as funded 

through the FY 2010 appropriations bill for the Department of Housing and Urban 

Development. Now, we are currently in the midst of preparing an application for 

an Implementation Grant under the Choice Neighborhoods program, and I will have 

more to say on that later in my testimony. 

I also want to commend you, Chairman Menendez, for authoring the bill to establish and implement Choice Neighborhoods in S. 624, ‘‘the Choice Neighborhoods Initiative Act of 2011’’, which would permanently authorize the program. Although the 

program has been funded for the last few years through the appropriations process, 

CNI has lacked the critical legitimacy of an authorized program conferred through 

the regular order of Congress. The hearings today will begin to rectify that deficiency. 

As has been mentioned, Choice Neighborhoods builds upon the model and achievements of the HOPE VI program. HOPE VI has transformed communities by turning 

severely distressed public housing into mixed-income, mixed-use and revitalized 

communities that serve as long-term assets in their neighborhoods. HOPE VI has 

led the way in establishing new partnerships and leveraging additional resources. 

HOPE VI has also been a pioneer and laboratory for neighborhood place-based redevelopment. 

In a MacArthur Foundation study commissioned by the Council of Large Public 

Housing Authorities, the study found that HOPE VI redevelopments have had significant economic and fiscal impacts on their surrounding areas. The HOPE VI 

neighborhoods in the study showed major drops in violent crime rates, increases in 

household income and rising home values. The study concluded that HOPE VI is 

a useful and cost-effective approach for catalyzing positive economic change in local 

communities. This has been true for us. 

The JCHA has been awarded three HOPE VI Revitalization Program grants, 

which have resulted in 730 constructed units and 275 planned units in mixed income communities including public housing, affordable and market rate units. Our 

HOPE VI communities have served as a model for developing quality sustainable 

affordable housing, which has been applauded by City, State, and Federal officials 

and residents of public housing and the broader community and imitated by private 

and not-for-profit developers. Our HOPE VI Programs met the goals of rebuilding 

severely distressed public housing, deconcentrating poverty, leveraging non-Federal 

funds and providing higher quality, efficient affordable housing with reduced operating costs through the physical transformation to mixed income developments and 

a Community and Supportive Services Program that focused on self-sufficiency initiatives, with a major goal of reducing unemployment. 

The HOPE VI Program also began the organizational transformation of the JCHA 

from property manager to developer. Today the JCHA is regarded as the major affordable housing developer in the city. Severely distressed public housing has been 

replaced with lower density housing that compliments the existing neighborhood, 

new developments that are community assets and attracting a diverse economic 

resident population in well maintained housing. Critics of the stereotyped public 

housing have become the strongest supporters of our new HOPE VI developments. 

Much of the success of our HOPE VI Program is also a result of our strong commitment to Section 3 local hiring initiatives. To date, 500 public housing/local residents have been hired and $22 million has been targeted to Minority Business Enterprise businesses. 

To date, 66% of the public housing units in HOPE VI developments have been 

leased to former relocatees. But perhaps the best indication of success comes from 

a public housing resident who returned to a HOPE VI development and expressed 

how her child can ‘‘sleep in peace, I don’t hear gun shots in the middle of the night’’. 

Choice Neighborhoods proposes to do the same by transforming neighborhoods of 

extreme poverty into mixed-income neighborhoods of long-term viability. It proposes 

to revitalize severely distressed housing, improve access to economic opportunities, 

leverage investments in well-functioning services, help foster effective schools and 

education programs, public assets, and help improve access to public transportation 

and improved access to jobs. 

Whereas the major HOPE VI focus was on addressing severely distressed public 

housing, CHOICE capitalizes on the strengths of institutions and assets of the 

neighborhood, convenes all neighborhood stakeholders and encourages their input, 

and pulls together disparate developments in various stages to plan and implement 

a singular comprehensive neighborhood transformation plan through tried-and-true 
30 

* The views expressed are those of the author and do not necessary reflect those of the Urban 

Institute, its trustees, or its funders. 

successful public-private partnerships. It was with these goals in mind that the 

JCHA applied for and was awarded a CHOICE Planning Grant last March. 

The CHOICE Neighborhood Initiative is a natural extension of the HOPE VI Program. It will allow us to expand on our successful public/private partnerships to develop a comprehensive plan for a neighborhood that includes the transformation of 

Montgomery Gardens, our remaining high rise family development within the 

broader McGinley Square-Montgomery Corridor Neighborhood. Montgomery Gardens is currently perceived as a liability to further renewed investment in the neighborhood. 

Perhaps most importantly, the transformation of Montgomery Gardens to a new 

CHOICE community that guarantees one for one replacement housing, ensures that 

the inevitable gentrification that will accompany market rate development will be 

addressed by the inclusion of affordable housing resulting in a quality mixed income 

community. At the JCHA we made a commitment to one for one replacement housing, however we recognize it may not be a viable replacement policy for every community. 

Properly implemented, we believe Choice Neighborhoods will be a broad placebased solution to help address the housing, transportation, energy, education, workforce, environmental, health, business and development needs of neighborhoods and 

communities. We hope that with passage of this legislation we can work towards 

a more streamlined implementation process, and we stand ready to work with HUD 

on improving implementation of their current Choice Neighborhoods program. 

For example, we must be sure to create the type of environment that encourages 

and incentivizes the private sector to participate, and we must be careful to not be 

overly prescriptive in the implementation process. Under HOPE VI, the implementation process was structured such that public and private partners could come to 

the table and develop unique solutions to local housing challenges. 

We would like to see this same kind of successful structure adopted in the Choice 

Neighborhoods implementation process. We should also develop an implementation 

process that creates an intentional alignment of funding opportunities with other 

Federal agencies. We believe Choice Neighborhoods can be vitally important to longterm livability and can be an effective strategy to promoting sustainable communities for succeeding generations. 

One aspect of the legislation we believe is critically important—particularly as 

Choice Neighborhoods continues the legacy of HOPE VI—is the focus on public 

housing which we believe must be maintained. Three years ago, HUD acknowledged 

that there are three times the number of distressed developments in public housing 

as compared to assisted housing. We appreciate the legislation acknowledging this 

focus by designating not less than two-thirds of the amounts made available in any 

fiscal year, or two-thirds of the units assisted under Choice Neighborhoods shall be 

public housing units. 

We would further recommend that applicants for Choice Neighborhoods should either be, or partner with, a public housing agency; or, if no public housing agency 

is available or interested, then other eligible entities are subsequently considered. 

In closing, I thank you for the opportunity to testify today on S. 624 authorizing 

the Choice Neighborhoods Initiative. 

PREPARED STATEMENT OF SUSAN J. POPKIN, PH.D. * 

DIRECTOR, PROGRAM ON NEIGHBORHOODS AND YOUTH DEVELOPMENT

URBAN INSTITUTE

MARCH 27, 2012 

Mr. Chairman and Members of the Committee, thank you for inviting me to appear here today. For the past 14 years, I have been studying the impact of the 

HOPE VI program on the original residents of public housing projects that are demolished and replaced. While most of my research has focused on Chicago, which 

had more distressed public housing than any other city in the country, I have conducted research in 13 HOPE VI sites across the country. The testimony I present 

here today draws from four major studies: The HOPE VI Panel Study, which 

tracked residents from five sites across the country; the Chicago Panel Study; the 

Chicago Family Case Management Demonstration; and the new HOST Demonstration. 
31 

1The Urban Institute has just completed a 10-year follow-up with the Chicago Panel Sample; 

results from that research will be available in summer 2012. 

Twenty years ago, dilapidated, high-crime public housing developments populated 

by impoverished, female-headed households were a powerful symbol of the failures 

of U.S. social welfare policy. HOPE VI was a key element of a bold effort to transform these public housing communities and demonstrate that housing programs 

could produce good results for residents and communities. The program provided 

grants to housing authorities to replace their most distressed developments-those 

with high crime rates, physical decay, and obsolete structures-with new, mixed-income, mixed-tenure communities. In a departure from earlier efforts to ‘‘rehabilitate’’ public housing, HOPE VI sought to move beyond ‘‘bricks and mortar, and provided funding for supportive services for residents intended to help them move toward self-sufficiency and improve their life circumstances’’ (Popkin, Levy, and Buron 

2009). 

HOPE VI was, at its core, a housing intervention, and there is no question that 

the program has changed the face of public housing-hundreds of those dilapidated 

structures have been replaced with attractive new developments, and the program 

has sparked innovations in financing and management (Katz 2009; Popkin et al., 

2004). The program succeeded in improving many families’ housing situations and 

quality of life. Evidence from The Urban Institute’s comprehensive HOPE VI Panel 

Study and its follow-up, the Chicago Panel Study, shows that many former residents 

received Housing Choice Vouchers or moved into mixed-income developments. These 

residents now live in better housing in neighborhoods that are considerably less 

poor and distressed and provide safe environments for them and their children. 

However, as I will discuss, HOPE VI was less successful in helping families improve their economic circumstances and was not a solution for the most vulnerable 

households. Findings from the Moving to Opportunity Demonstration (Sanbotmutsu 

et al., 2011) and from evaluations of individual HOPE VI initiatives show similar 

results (Popkin, Levy, and Buron 2009). These findings suggest that Choice Neighborhoods and other new comprehensive community redevelopment efforts that seek 

to improve the well-being of low-income residents in distressed neighborhoods need 

to provide services and support that will help address the complex challenges many 

of these families face in moving toward self-sufficiency. 

Better Housing in Safer Neighborhoods 

The HOPE VI Panel Study tracked outcomes for 887 residents from five sites 

around the United States: Shore Park/Shore Terrace (Atlantic City, NJ); Ida B. 

Wells Homes/Wells Extension/Madden Park Homes (Chicago, IL); Few Gardens 

(Durham, NC); Easter Hill (Richmond, CA); and East Capitol Dwellings (Washington, DC) from 2001 to 2005 (Popkin, Levy, and Buron 2009). The Chicago Panel 

Study (Popkin et al., 2010a) continued the research, surveying the Chicago sample.1

This research concluded that for the most part, HOPE VI succeeded in its goal 

of improving residents’ life circumstances. The majority have experienced meaningful improvement in their quality of life as a result of HOPE VI redevelopment, even 

though most residents have not moved back to the new, mixed-income site. HOPE 

VI Panel Study respondents who moved to the private market or mixed-income developments reported substantial improvements in the quality of their housing. At 

baseline in 2001, respondents from all five sites reported intolerable and hazardous 

housing conditions; when we followed them up in 2005, their circumstances had improved substantially, and relatively few reported serious problems with their housing (Comey 2007). Four years later, findings from the Chicago Panel Study (Buron 

and Popkin 2010; Popkin et al., 2010a) documented continuing improvements, with 

virtually all former residents reporting better housing quality, regardless of whether 

they now lived in mixed-income housing, in the private market with a voucher, or 

in rehabilitated traditional public housing. 

Even more significantly, HOPE VI brought about dramatic improvement in respondents’ sense of safety. The proportion of Panel Study respondents reporting ‘‘big 

problems’’ with violent crime and drug sales declined consistently after relocation. 

In Chicago, the trends were even more striking: respondents’ perceptions of violence 

and disorder in their neighborhoods decreased significantly across every measure 

the study tracked, with fewer than 25 percent reporting major problems with disorder (drug trafficking, sales, loitering, and gangs) by 2009. Likewise, the proportion 

of respondents who rated three indicators of violence (shootings and violence, attacks, and sexual assault) as a big problem in their community declined by more 

than 50 percent. The benefits of the improvements in safety are profound, with residents reporting significantly lower levels of anxiety and fear and in qualitative 
32 

2These findings are consistent with new research from the Moving to Opportunity Demonstration (Sonbanmatsu et al., 2011). 

interviews, describing being able to sleep better, and feeling comfortable letting 

their children play outside (Popkin and Cove 2007; Popkin and Price 2010). 

Finally, respondents who had left traditional public housing living in communities 

that were much less poor than their original public housing developments, even if 

they were not living in a new mixed-income development. After relocation, half of 

those renting in the private market were living in neighborhoods that had poverty 

rates below 20 percent—in Chicago in 2009, a quarter of the sample were living in 

communities where the poverty rate was less than 15 percent (Buron, Levy, and 

Gallagher 2007; Comey 2007; Popkin et al., 2010a). 

Significant Challenges Remain 

But this research also highlights the significant challenges that remain—particularly residents’ shockingly poor health and persistently low levels of employment— 

problems that will require more intensive, focused interventions. At every age level, 

HOPE VI Panel Study respondents are much more likely to describe their health 

as fair or poor than other adults overall and even than black women, a group with 

higher-than-average rates of poor health. Further, HOPE VI Panel Study respondents report high rates of a range of chronic, debilitating conditions, including arthritis, asthma, obesity, depression, diabetes, hypertension, and stroke. Mental health 

is a very serious problem for these respondents—not only depression, but reported 

rates of anxiety and other indicators were also very high: Overall, 29 percent of 

HOPE VI respondents indicated poor mental health (Manjarrez, Popkin, and Guernsey 2007). Four years later, the Chicago Panel Study found a deteriorating situation, 

with more than half the respondents rating their health as fair or poor—a rate four 

times that of the general population. Underscoring the severity of the problem, the 

mortality rate for these residents was stunningly high—more than twice that of the 

general population (Price and Popkin 2010). 

In addition to providing an improved living environment, the HOPE VI program’s 

goals included helping residents attain self-sufficiency. However, the evidence from 

our research shows that employment rates have remained persistently low, averaging just under 50 percent, although these rates reflect considerable cycling in and 

out of the labor market (Levy 2010; Levy and Woolley 2007). Our research shows 

that health problems are by far the biggest barrier to employment: in 2005, among 

working-age respondents, nearly a third (32 percent) reported poor health, and most 

of them (62 percent) were unemployed. At each round of surveys, the strongest predictor of not working was having severe challenges with physical mobility (e.g., 

being unable to climb a flight of stairs or walk four blocks without resting). Depression also substantially reduced the probability of being employed, as did having 

been diagnosed with asthma and being obese. 

Finally, even though moving out of distressed public housing has generally improved residents’ well-being, findings from the Urban Institute’s research provide an 

important cautionary note about the challenges that these households may face 

when they move to the private market with vouchers (Buron, Levy, and Gallagher 

2007). Moving out of public housing presents new financial management challenges: 

private-market property managers can be less forgiving of late rent payments than 

public housing managers, making it imperative that rent is paid on time. Also, since 

utilities are generally included in the rent in public housing, many former public 

housing residents are inexperienced in paying utility bills. They can find coping 

with seasonal variation in utility costs, particularly heating costs in the winter or 

spikes in gas costs, very daunting. At the 2005 follow-up and again in Chicago in 

2009, we found that residents who moved to the private market with vouchers were 

significantly more likely to report trouble paying their utility bills than those still 

living in traditional public housing (Levy 2010). Likewise, voucher holders were 

more likely than public housing households to report financial hardships paying for 

food. However, voucher holders were significantly less likely than public housing 

residents to be late paying their rent. It appears that former residents might be 

making tradeoffs, choosing to pay their rent on time to remain lease compliant and 

delaying utility payments.2

The Most Vulnerable Need More Intensive Support 

Although it improved the circumstances of many former residents of distressed 

public housing, it is also clear that the HOPE VI program was not as successful in 

addressing the more complex social and economic challenges facing these very lowincome families. In particular, it was not a solution for the most vulnerable-the subset of families who are ‘‘hard to house’’ because of multiple, complex problems that 
33 

3 Costs varied considerably by level of need and service take-up, with high-risk participants 

using the most services. 

make them ineligible for mixed-income housing or unable to cope with the challenges of negotiating the private market with a housing choice voucher. These families are not typical of all public housing residents, but make up a large share of 

those living in the kind of distressed public housing complexes targeted for redevelopment (Popkin, Cunningham, and Burt 2005; Theodos et al., forthcoming). 

These findings led the Urban Institute to work with housing authorities to test 

more intensive service models. The Chicago Family Case Management Demonstration (Popkin et al., 2010b; Theodos et al., 2012) provided one model for serving the 

needs of the most vulnerable public and assisted housing families. The Demonstration developed and tested an innovative program for serving the needs of the most 

troubled public housing residents-households with high rates of physical and mental 

health problems, low levels of educational attainment, weak attachment to the labor 

force, and high levels of involvement in public systems (criminal justice, child welfare). The Demonstration, a partnership of The Urban Institute, the Chicago Housing Authority (CHA), and Heartland Human Care Services, ran from March 2007 

to March 2010, providing residents from the CHA’s Dearborn Homes and Madden/ 

Wells developments with intensive case management services, where clients saw 

their case managers at least once a week; a Transitional Jobs program that provided subsidized jobs and on-the-job training; financial literacy training; and mobility counseling to support participants in moving to communities that offered access 

to better schools, jobs, and amenities. The Urban Institute conducted a rigorous 

evaluation of the initiative. 

The Demonstration was remarkably successful in implementing this wraparound 

supportive service model for vulnerable public housing residents. The lead service 

provider was able to adapt the service model as residents relocated with vouchers 

or to mixed-income housing, while sustaining high levels of engagement. Participants perceived improvements in service quality and delivery, and providers felt 

more effective and engaged. Strikingly, participants reported gains in employment, 

health, improved housing and neighborhood conditions, and reduced levels of fear 

and anxiety. The average costs for the intensive services per household were relatively modest, about $3,600 per year or $1,600 more than the standard CHA service package.3

Most significantly, despite an extremely difficult labor market, self-reported employment among working-age Demonstration participants increased from 49 percent 

in 2007 to 59 percent in 2009, likely due to the support participants received from 

the intensive Transitional Jobs program (Parilla and Theodos 2010). Also striking 

was the finding that, in contrast to the results of the HOPE VI and CHA Panel 

studies, Demonstration participants’ health did not decline over time. Between 2007 

and 2009, participants’ health status remained remarkably stable; in fact, more respondents reported improvements than declines. Further, while there was no change 

in the proportion of respondents who reported poor mental health or clinical depression, respondents did report significant reductions in anxiety. 

As was the case with HOPE VI, Demonstration participants experienced gains in 

their housing and neighborhood quality, although the majority (59 percent) remained in traditional public housing. Participants perceived that relocating had 

major benefits, with four out of five reporting that they live in better-quality housing than at baseline. Like their counterparts in the HOPE VI studies, Demonstration participants also moved to neighborhoods where they feel safer, have more connections with their neighbors, and report less physical and social disorder (Theodos 

and Parilla 2010). 

Still, it was clear that it was easier to improve residents’ housing and neighborhood conditions than to address their physical and emotional health. Even the intensive case management and clinical services the Demonstration provided were 

only able to make a small dent in health outcomes for participants—seemingly stabilizing their overall health, reducing anxiety, and lowering levels of alcohol consumption. While health stabilized overall, levels of chronic illness and mortality 

rates remained strikingly high (Popkin and Getsinger 2010). This modest progress 

underscores the depth of the challenges facing these families—and service providers. 

Finally, findings from the Chicago Family Case Management Demonstration paint 

a disturbing picture of at-risk children and youth living in extremely troubled 

households. These children have endured years of living in violent and chaotic environments; in many cases, their parents were so distressed—suffering from mental 

and physical illness, struggling with substance abuse, dealing with histories of trauma—that they were unable to shield their children from the worst effects of the 

stresses surrounding them. Although the Demonstration took a family focused ap-
34 

proach, no services or case managers were explicitly dedicated to children and 

youth; at the follow-up, these children were still experiencing alarming levels of distress and exhibiting high levels of behavior problems and delinquency (Getsinger 

and Popkin 2010). 

Moving to Dual-Generation Strategies 

The Chicago Family Case Management Demonstration offers important lessons on 

what it will take to help improve the well-being of even the most vulnerable families. However, even though that demonstration succeeded in improving many outcomes for adults, the benefits did not extend to children and youth. Developing effective place-based models that reach youth is critical not only for improving the 

lives of individual children and youth, but also for ensuring the health and viability 

of public and mixed-income communities. If youth engagement strategies are successful, they can reduce critical neighborhood problems such as vandalism, drug 

trafficking, fighting, and gang activity—the disorder and violence that have considerable impact on other residents and can drive away other residents. The Urban Institute’s new, multisite HOST (Housing Opportunities and Services Together) Demonstration builds on lessons learned from our earlier research in Chicago. Launched 

in December 2010, HOST is testing innovative, two-generation service models to improve the life chances of vulnerable low-income families living in public and mixedincome housing communities. At its core, the demonstration aims to address parents’ key barriers to self-sufficiency—such as poor physical and mental health, addictions, low levels of literacy, lack of a high school diploma, and historically weak 

connection to the labor force—while simultaneously integrating services and supports for children and youth. HOST is currently being implemented in three carefully selected sites in variety of settings—from those serving high need populations 

in traditional public housing located in high poverty neighborhoods to populations 

in newly developed mixed-income neighborhoods. The three participating housing 

authorities and sites are: 1) Chicago Housing Authority, Altgeld Gardens; 2) Home 

Forward (Formerly the Housing Authority of Portland), New Columbia and Humboldt Gardens mixed-income developments; and the District of Columbia Housing 

Authority, Benning Terrace. The New York City Housing Authority is also planning 

on joining the demonstration, and will likely plan to serve families in the Brownsville community. 

During its 2-year implementation, the HOST Demonstration will identify strategies and services that help the families at greatest risk and offer the best potential 

for strengthening the community. This information will inform the Federal Government’s multiagency Neighborhood Revitalization Initiative, which encompasses the 

Department of Housing and Urban Development’s Choice Neighborhood program, 

the Department of Education’s Promise Neighborhoods program, and the Department of Justice’s Byrne Criminal Justice Innovation program. Looking forward, 

HOST will help answer critical questions about what works for whom and provide 

important insight into how local communities implement similar dual-generation 

models to improve the life chances of their most vulnerable children and families. 

Incorporating Services into Comprehensive Community Initiatives 

Incorporating intensive case management and permanent supportive housing for 

the most vulnerable residents into Choice Neighborhoods and any other comprehensive redevelopment efforts is one way to ensure that these initiatives truly meet the 

needs of all public housing families. The Choice Neighborhoods initiative builds on 

the successes of HOPE VI and broadens the scope of revitalization efforts beyond 

public housing to the surrounding community, including schools and other types of 

housing. However, if this new effort is to be more successful than its predecessor 

in improving the lives—and long-term life chances—of the vulnerable families who 

suffered the worst consequences of living in distressed public housing, it is essential 

that it incorporate strategies that effectively address their needs (Popkin and 

Cunningham 2009). None of these solutions are simple, and all will require a longterm commitment to improving the quality of life for these households, and ensuring 

better futures for their children. 

REFERENCES 

Buron, Larry, and Susan J. Popkin. 2010. ‘‘CHA after Wells: Where Are the Residents Now?’’ CHA Families and the Plan for Transformation Brief 1. Washington, 

DC: The Urban Institute. 

Buron, Larry, Diane Levy, and Megan Gallagher. 2007. ‘‘How Did People Who Relocated from HOPE VI with Vouchers Fare?’’ HOPE VI: Where Do We Go from Here? 

Brief 3. Washington, DC: The Urban Institute. 
35 

Cisneros, Henry G. 2009. ‘‘A New Moment for People and Cities.’’ In From Despair 

to Hope: HOPE VI and the New Promise of Public Housing in America’s Cities, 

edited by Henry G. Cisneros and Lora Engdahl (3–14). Washington, DC: Brookings Institution Press. 

Comey, Jennifer. 2007. ‘‘HOPE VI’d and On the Move: Mobility, Neighborhoods, and 

Housing.’’ HOPE VI: Where Do We Go from Here? Brief 1. Washington, DC: The 

Urban Institute. http://www.urban.org/url.cfm?ID=311485. 

Getsinger, Liza, and Susan J. Popkin. 2010. ‘‘Reaching the Next Generation: The 

Crisis for CHA’s Youth.’’ Supporting Vulnerable Public Housing Families Brief 6. 

Washington, DC: The Urban Institute 

Katz, Bruce. 2009. ‘‘The Origins of HOPE VI.’’ In From Despair to Hope: HOPE VI 

and the New Promise of Public Housing in America’s Cities, edited by Henry G. 

Cisneros and Lora Engdahl (15–30). Washington, DC: Brookings Institution Press: 

15–30. 

Levy, Diane K. 2010. ‘‘The Limits of Relocation: Employment and Family Well-Being 

among Former Madden/Wells Residents.’’ CHA Families and the Plan for Transformation Brief 6. Washington, DC: The Urban Institute 

Levy, Diane K., and Mark Woolley. 2007. ‘‘Employment Barriers among HOPE VI 

Families.’’ HOPE VI: Where Do We Go from Here? Brief 6. Washington, DC: The 

Urban Institute. http://www.urban.org/url.cfm?ID=311491. 

Manjarrez, Carlos, Susan Popkin, and Elizabeth Guernsey. 2007. ‘‘Poor Health: The 

Biggest Challenge for HOPE VI Families?’’ HOPE VI: Where Do We Go from Here? 

Brief 5. Washington, DC: The Urban Institute. 

Parilla, Joe, and Brett Theodos. 2010. ‘‘Moving ‘Hard to House’ Residents to Work: 

The Role of Intensive Case Management in Employment.’’ Supporting Vulnerable 

Public Housing Families Brief 4. Washington, DC: The Urban Institute. 

Popkin, Susan J., and Elizabeth Cove. 2007. ‘‘Safety Is the Most Important Thing: 

How HOPE VI Helped Families.’’ HOPE VI: Where Do We Go from Here? Brief 

2. Washington, DC: The Urban Institute. http://www.urban.org/ 

url.cfm?ID=311486. 

Popkin, Susan J., and Mary K. Cunningham. 2009. ‘‘Has HOPE VI Transformed 

Residents’ Lives?’’ In From Despair to Hope: HOPE VI and the New Promise of 

Public Housing in America’s Cities, edited by Henry G. Cisneros and Lora 

Engdahl (191–204). Washington, DC: Brookings Institution Press. 

Popkin, Susan J., and Liza Getsinger. 2010. ‘‘Tackling the Biggest Challenge: Intensive Case Management and CHA Residents’ Health.’’ Supporting Vulnerable Public Housing Families Brief 3. Washington, DC: The Urban Institute. 

Popkin, Susan J., and David Price. 2010. ‘‘Escaping the Hidden War: Safety Is the 

Biggest Gain for CHA Families.’’ CHA Families and the Plan for Transformation 

Brief 3. Washington, DC: The Urban Institute. http://www.urban.org/ 

url.cfm?ID=412187. 

Popkin, Susan J., Mary K. Cunningham, and Martha Burt. 2005. ‘‘Public Housing 

Transformation and the Hard to House.’’ Housing Policy Debate 16(1): 1–24. 

Popkin, Susan J., Diane K. Levy, and Larry Buron. 2009. ‘‘Has HOPE VI Transformed Residents’ Lives? New Evidence From the HOPE VI Panel Study.’’ Housing Studies 24(4): 477–502. 

Popkin, Susan J., Brett Theodos, Liza Getsinger, and Joe Parilla. 2010. ‘‘Creating 

a New Model for Housing and Services.’’ Supporting Vulnerable Public Housing 

Families Brief 2. Washington, DC: The Urban Institute. 

Popkin, Susan J., Diane Levy, Larry Buron, Megan Gallagher, and David J. Price. 

2010. ‘‘The CHA’s Plan for Transformation: How Have Residents Fared?’’ CHA 

Families and the Plan for Transformation Overview Brief. Washington, DC: The 

Urban Institute. 

Popkin, Susan J., Bruce Katz, Mary K. Cunningham, Karen D. Brown, Jeremy Gustafson, and Margery Austin Turner. 2004. A Decade of HOPE VI: Research Findings and Policy Challenges. Washington, DC: The Urban Institute. 

Price, David, and Susan J. Popkin. 2010. ‘‘The Health Crisis for CHA Families.’’ 

CHA Families and the Plan for Transformation Brief 5. Washington, DC: The 

Urban Institute. 

Sanbotmutsu, Lisa, Jens Ludwig, Lawrence F. Katz, Lisa A. Gennetian, Greg J. 

Duncan, Ronald C. Kessler, Emma Adam, Thomas W. McDade, and Stacy Tessler 

Lindau. 2011. Moving to Opportunity for Fair Housing Demonstration Program: 

Final Impacts Evaluation. Cambridge, MA: National Bureau of Economic Research. 

Theodos, Brett, and Joe Parilla. 2010. ‘‘Assessing Relocating Counseling for Vulnerable Public Housing Families.’’ Supporting Vulnerable Public Housing Families 

Brief 5. Washington, DC: The Urban Institute. 
36 

1http://confoundedinterest.files.wordpress.com/2012/02/choice-neighborhoods-bill-as-introduced.pdf. 2Stanford Graduate School of Business, ‘‘Stanford Graduate School of Business Launches New 

Knight Management Center to Enable Innovative Curriculum and Engage Students Across University,’’ April 15, 2011, http://www.gsb.stanford.edu/news/headlines/knightmanagement 

centeropens.html. 3 U.S. Department of Housing and Urban Development Web site, ‘‘HOPE VI,’’ http://portal.hud.gov/hudportal/HUD?src=/programloffices/publiclindianlhousing/programs/ph/ 

hope6. 4 Carlos A. Manjarrez, Susan J. Popkin, and Elizabeth Guernsey, ‘‘Poor Health: Adding Insult 

to Injury for HOPE VI Families,’’ Metropolitan Housing and Communities Center, June 5, 2007, 

http://www.hartfordinfo.org/Issues/wsd/Housing/gblock/HOPEVIlHealth.pdf. 5 U.S. Department of Housing and Urban Development Web site, ‘‘FY 2010 HOPE VI Revitalization Grant Awards,’’ http://portal.hud.gov/hudportal/HUD?src=/programloffices/publiclindianlhousing/programs/ph/hope6/fy10awardees. 

Theodos, Brett, Susan J. Popkin, Joe Parilla, and Liza Getsinger. Forthcoming. 

‘‘Linking Services with Needs: A Typology of Public Housing Residents. Social 

Service Review. 

PREPARED STATEMENT OF ANTHONY B. SANDERS, PH.D. 

DISTINGUISHED PROFESSOR OF FINANCE

GEORGE MASON UNIVERSITY SCHOOL OF MANAGEMENT

MARCH 27, 2012 

Senator Menendez and distinguished Members of the Committee, my name is Dr. 

Anthony B. Sanders and I am the Distinguished Professor of Finance at George 

Mason and a Senior Scholar at the Mercatus Center. It is an honor to testify before 

this Committee today. 

I am here to discuss a proposed Senate bill: S. 624, the Choice Neighborhoods 

Bill.1 The Bill calls for $350 million in 2012 for competitive grants to revitalize distressed neighborhoods. 

Three-hundred-fifty million dollars spread over the United States for distressed 

neighborhoods is a drop in the bucket. Bear in mind that Stanford University recently built a business school campus for $345 million.2

This Bill is a revision of the HOPE VI program that was less than a success.3, 4 As of June 1, 2010 there have been 254 HOPE VI revitalization grants awarded 

to 132 housing authorities since 1993-totaling more than $6.1 billion. 

And yet Detroit, Cleveland, and many other inner cities continue to suffer. 

What are the changes to HOPE VI that give us hope that it will help? These 

changes are supported by housing advocates, private developers, HUD, and numerous community groups listed below. 

What are the changes to HOPE VI that give them hope? 

• Expands eligible properties to privately owned and managed but severely distressed HUD-assisted housing, that serves as affordable housing for an extended period of time; 

• Expands eligible applicants to include local governments, nonprofits, and forprofit developers to apply jointly with a public entity such as a Public Housing 

Authority; 

• Ensures coordination and efficient use of resources by requiring transformation 

plans to address not only housing, but jobs, supportive services, economic development, education, recreation, and transportation; 

• Allows conversion of vacant or foreclosed properties to affordable housing as an 

eligible project, which addresses the foreclosed and vacant homes plaguing 

many communities; 

• HUD had $265M for this work in 2010 and currently has $165M available in 

2011. The bill would authorize the Choice Neighborhoods Initiative at $350M 

as a full replacement for HOPE VI. 

This is another move toward private-public partnerships like we have with Fannie 

Mae and Freddie Mac, the mortgage giants in conservatorship. Private-public partnerships sound like a ‘‘free market’’ solution, but they are not. In 2010, the grant 

recipients were housing authorities where $22 million per development was common.5 Now the idea is to open up the grants for nonprofits and for-profit developers 

to join hands with public housing authorities to deliver the same public housing solution that has been a failure for decades. 
37 

6 U.S. Department of Housing and Urban Development Web site, ‘‘FY 2012 Budget Summary,’’ 

February 2011, http://portal.hud.gov/hudportal/documents/huddoc?id=fy2012budget.pdf. 7 U.S. Congress Joint Committee on Taxation, ‘‘General Explanation Of The Economic Recovery Tax Act of 1981, (H.R. 4242, 97th Congress, Public Law 97–34),’’ December 31, 1981, http:// 

www.jct.gov/publications.html?func=startdown&id=2397. 8 Karl Case, ‘‘Investors, Developers, and Supply Side Subsidies: How Much is Enough?’’ Housing Policy Debate 2 no. 2 (1991), http://www.wellesley.edu/Economics/case/PDFs/ 

InvestorsDevelopers.apr1991.pdf; and James Poterba, ‘‘Tax Reform and Housing Market in the 

Late 1980s: Who Knew What, and When Did They Know It?’’ Federal Reserve Bank of Boston 

Conference Series (1992), http://www.bos.frb.org/economic/conf/conf36/conf36g.pdf. 9 Anthony B. Sanders, ‘‘Private Market Solution to Foreclosure: Bank of America’s Lease Alternative to Foreclosure,’’ Confounded Interest blog, 22 March 2012, http:// 

confoundedinterest.wordpress.com/2012/03/22/private-market-solution-to-foreclosure-bank-ofamericas-lease-alternative-to-foreclosure/. 

After billions of dollars have been spent, Hope VI and this bill should focus on 

a better way to help the poor rather than ‘‘a lick of paint’’ approach public housing. 

After all, $350 million is a drop in the proverbial bucket. 

A Better Way 

The Senate and the House have taken an important step recently in terms of trying to unshackle the free market and encourage job creation. Job creation is important to solving the problems of our lower-income households, allowing them to possibly escape public housing. 

But not everyone will be able to escape public housing. While our public housing 

is far better than many other countries: a visit to various public housing projects 

will convince you that improvements in public housing are still needed. 

The Administration and Congress have set aside staggering amounts of money for 

housing and mortgage programs already. HAMP, HARP 2.0, the Attorney General 

Settlement of $25 billion, the proposed FHA Refi program from President Obama’s 

2012 State of the Union Address, HUD’s 2012 Budget of $47,199,000,000,6 and the 

losses of Fannie Mae and Freddie Mac to taxpayers of $160 billion puts the amount 

thrown at housing by various government entities at over $230 billion in recent 

years. 

Department of Housing and Urban Development Secretary Shaun Donovan is an 

advocate of improving the quality of housing projects in the Nation. But why can’t 

HUD find $350 million in their $47.2 billion budget through effective budget management? Does HUD not deem Choice Neighborhoods Initiative important enough 

to fund in its own budget? 

A better way to help solve the problem is to unleash the free market on housing. 

Taking a page from the President Reagan (and Democratic majority) playbook, we 

should use fiscal policy to increase the supply of clean, affordable housing by offering accelerated depreciation deductions on multifamily housing. This will increase 

the supply of housing without having to go through housing authorities and not-forprofits. 

The Reagan/Democratic Congressional approach (also known as the Kemp-Roth 

‘‘Economic Recovery Tax Act of 1981’’ (Pub.L. 97–34)7 was to increase depreciation 

deductions on multifamily housing using the Accelerated Cost Recovery System 

(ACRS).8 Under this legislation, all property was depreciable for tax purposes over 

15 year and for low-income housing, 200 percent declining balance depreciation was 

available. Furthermore, rehabilitation expenditures for low-income housing could be 

amortized over 5 years. The Act worked so well that it was amended in 1986 with 

the 1986 tax act. 

We could once again use fiscal policy to help solve the public housing problem. 

I would prefer this solution to the ‘‘lick of paint’’ approach to revitalizing distressed 

neighborhoods. 

To be sure, such legislation could create additional deficits, but the simulative effects to the economy and the distressed neighborhoods could be greater than the lost 

tax income received by the Federal Government. 

Recently, Bank of America announced a ‘‘Mortgage to Lease’’ trial program.9 To 

avoid foreclosure and yet another property going to Real Estate Owned (REO) and 

out in the already flooded housing market, this proposal from Bank of America will 

keep homeowners in their current home but switch them to renters. It is a way to 

stabilize neighborhoods hit by the foreclosure crisis and curtail neighborhood blight 

by keeping a portion of distressed properties off the market. 

Between stimulating the construction and rehab or public housing and initiatives 

like Bank of America’s ‘‘Mortgage to Lease’’ trial program, we now see better potential to fix the problems of public housing. 

Thank you for the opportunity to testify. 
38 

PREPARED STATEMENT OF PAUL N. WEECH 

EXECUTIVE VICE PRESIDENT, POLICY AND MEMBER ENGAGEMENT

HOUSING PARTNERSHIP NETWORK

MARCH 27, 2012 

Chairman Menendez, Ranking Member DeMint, and Members of the Housing 

Subcommittee: Thank you so much for inviting me to testify today. I am honored 

to be with you to discuss the Choice Neighborhoods Initiative and to represent the 

Housing Partnership Network. 

About the Housing Partnership Network 

The Housing Partnership Network is a member-driven collaborative of 99 entrepreneurial nonprofits that build, manage, and finance affordable housing. Our members include mission-driven lenders, housing developers, property owners and managers, and housing counselors—all of whom are managing their enterprises based 

on good business practices while at the same time working to provide their residents 

with decent, affordable places to live in healthy and sustainable communities. 

Through peer-to-peer exchanges organized by the Network, our members come together to share best practices, create innovative solutions to housing and community 

development challenges, and launch collaborative businesses that enhance their sustainability and impact. 

Our members are domiciled in 32 different States and in the District of Columbia. 

HPN members operate over large geographic areas—at least on a citywide basis, but 

more often on a regional, State-wide, multistate, or even a national footprint. The 

membership has operations in all 50 States. 

In the Chairman’s State of New Jersey we are very pleased to count the New 

Communities Corporation (NCC) as a member. Founded in 1967 after the Newark 

civil disorders, NCC is—like most of the members of the Housing Partnership Network—among the more comprehensive and the larger community development organizations in the United States. NCC has developed and financed 3,000 housing units 

serving 7,000 residents in Newark, Jersey City, and Orange. NCC provides day care, 

alternative education, social services, job training, employment services, and health 

care to residents of the Newark area. A list of all the HPN members is included 

in this testimony as Attachment A. 

These strong nonprofit organizations are critical institutions at the center of affordable housing and community development efforts in many areas of the country. 

Their combination of mission focus and business discipline brings a new capacity to 

deal with longstanding neighborhood needs. They are, in effect, small- and mediumsized businesses. HPN members succeed because they are skilled in creating effective partnerships with State and local governments, private sector actors, financial 

institutions, and the civic leaders in the communities where they operate. They have 

demonstrated experience as effective stewards of public resources and as entrepreneurial actors capable of magnifying the community impact of public funds by using 

these to leverage private resources. These organizations demonstrate that there are 

economies of scale in this work and they bring financial strength through the diversification of their revenues. 

Collectively, the 99 HPN members have developed or preserved more than 

230,000 affordable homes, financed more than 420,000 homes, and counseled more 

than 600,000 families. As a group, the Network members have over 13,000 employees and nearly a $1 billion in annual revenues. We estimate that the value of the 

housing developed or financed by the membership since 1980 exceeds $67 billion.The point of the statistics is that the members of HPN are sophisticated, highcapacity social enterprises with long records of accomplishment in affordable housing and community development. 

Support for S. 624 and the Choice Neighborhoods Approach 

On behalf of this group of organizations, Mr. Chairman, I am here to strongly endorse Senate bill 624, The Choice Neighborhood Initiatives Act of 2011. I urge the 

Committee to report this legislation to the full Senate at its earliest possible opportunity. I am testifying today for the Network, but would also like to acknowledge 

the good work and leadership of the Choice Neighborhoods Coalition of which we 

are a member. I attach the Coalition’s letter to the Senate Banking Committee in 

support of the Choice Neighborhoods program in the hope that it can also be included in the record with this testimony (See Attachment B). 

The Choice Neighborhoods program builds on the long record of success of the 

HOPE VI program. I was here on the Senate Banking Committee staff when HOPE 

VI was launched. The program has had a long and successful run providing local 

communities with the resources required not just to renovate and rehabilitate dis-
39 

tressed residential real estate, but to actually transform communities where both 

the physical and social systems were not working effectively before the public investment. With the application of HOPE VI grants, highly distressed, dysfunctional 

public housing high-rise communities were transformed into sustainable mixed-income communities where low-income and middle-income families could live together 

and the surrounding landscape was transformed from one of blight and decay to one 

that encourages additional private investment. The positive changes that occurred 

in community after community around the country as a result of the HOPE VI effort 

are visible in hundreds of before and after photos. 

The Choice Neighborhoods Initiative builds on the HOPE VI record of success but 

also introduces three important changes that we strongly endorse. Most importantly, Choice Neighborhoods expands the focus of the program beyond just public 

housing developments to include equally distressed properties under nonpublic ownership. In too many communities, distressed privately owned HUD-assisted housing 

resides side-by-side with the distressed public housing inventory. While we are entirely sympathetic to the underfunded capital needs of the public housing inventory 

and support a variety of strategies to address this challenge, the insight of Choice 

Neighborhoods is that whether the distressed real estate is publicly owned or privately owned, it has the same negative effects on the people who live in those properties and those who live in the communities surrounding those properties. Local 

governments struggling to combat the infection of blight and spiraling disinvestment need a tool to reposition this distressed real estate or the community assets 

will remain blighted, undervalued, a drain on the community, and a contributor to 

poor social outcomes. 

The second important innovation is that Choice Neighborhoods builds on HOPE 

VI by allowing local governments, nonprofits, and for-profit developers (in conjunction with the local government) to step into a lead development role where previously the lead grantee role on HOPE VI efforts was the sole province of public 

housing agencies. This is an important breakthrough. As outlined above there is 

now within the affordable housing delivery system a solid and growing set of highly 

competent nonprofit institutions capable of not only leading complicated, multisourced, multi-outcome developments, but in many places providing the Federal 

and/or local government with a redevelopment leadership option that has the potential to provide greater positive outcomes for the community. A strong nonprofit developer is mission-aligned with the public sector and can often bring skills and flexibility not available to the public actors. At the same time, like for-profit development entities, these organizations bring business-like approaches and the ability to 

work with and leverage private capital. As the Choice Neighborhoods program 

evolves we would like the government to embrace a more open competition for the 

resources where developments and development plans are selected based on the 

strength and track record of the counterparties and their ability to deliver on positive, measurable social and real estate outcomes on behalf of the residents and the 

broader community. Competition should lead to better outcomes. In practice, many 

HOPE VI redevelopments were the result of successful public/private/not-for-profit 

partnerships. The Choice Neighborhoods program going forward should continue to 

encourage these types of partnerships to flourish where each party brings value and 

expertise that translates into better outcomes for the residents and the community. 

Finally, the Choice Neighborhoods approach advances on the HOPE VI model by 

requiring and promoting even greater linkages and synergies between the redevelopment effort and other public systems that make a community successful and increase opportunities for low-income residents. A successful community includes good 

schools, accessible health care, basic retail services like healthy grocery stores, access to jobs or access to transportation that connects residents to jobs, and strong 

support services for the individuals in the community who need these services. 

HOPE VI recognized that the revitalization of distressed public housing with high 

concentrations of poverty required services for needy families; Choice Neighborhoods 

goes further to advance new connections—especially with its efforts to create linkages to good schools, educational opportunities, and health care. The Administration 

deserves significant credit in its implementation of the Choice Neighborhoods program in its work to break down the silos that divide Federal agencies. This is a 

huge challenge and a place where Congress could do much to support for these efforts. 

There are hundreds of good Choice Neighborhoods projects already under consideration. In the FY 2010 and FY 2011 funding rounds, HUD received 236 applications from public, private, and nonprofit sponsors in 37 States, the District of Columbia, Puerto Rico, and the Virgin Island. From these, HUD has so far selected 

5 proposals for implementation grants and 30 for planning grants. 
40 

The Network’s Practitioner-Based Experience with Choice Neighborhoods 

The collective experience of HPN members reflects the evolution of affordable 

housing policy in this country. Over the past 25 years we have learned a great deal 

about what successful affordable housing does for its residents and the communities 

in which it is located. Poorly managed housing is associated with decay and other 

undesirable social outcomes. Decent, well-managed affordable housing is the platform for a wider array of positive social outcomes. Successful housing is housing 

that contributes to the success of its residents: this means linkages to jobs, services, 

health care, education, and the broader community. Housing that serves residents 

of different incomes often works better than housing that increases concentrations 

of poverty. Choice Neighborhoods embodies this learning and advances it. 

Nearly all Housing Partnership Network members are engaged in the spirit of the 

Choice Neighborhoods agenda through the work they carry out every day. Our multifamily housing developers are not only providing high quality affordable places to 

live for low-income seniors and families, but are working to link those families to 

health services for seniors, after-school programs for kids, and job preparedness 

services for heads of households. 

Our Community Development Financial Institution (CDFIs) members, in particular, are providing the financing and capital across a spectrum of community development activities as part of successful community revitalization efforts. In addition to financing affordable housing development, CDFIs in the Network are providing innovative financing to community facilities like senior centers, loans to child 

care facilities that allow the parents of pre-school kids to go to work, charter schools 

that are advancing educational opportunities, community health care facilities providing accessible, lower-cost services, and investments to link communities to transit. 

The Housing Partnership Network would be remiss if it did not recognize the 

Chairman’s strong leadership in supporting the CDFI industry and especially his 

work in sponsoring the CDFI Bond Guarantee program. The Bond Guarantee program has the potential to revolutionize the scale and impact of the organizations 

working so hard to revitalize America’s low-income communities by providing longterm patient capital. We would like to continue to work with you and your staff to 

achieve the successful launch of the CDFI Bond Guarantee program. 

Several Housing Partnership Network members are already active participants in 

the Choice Neighborhoods effort. Preservation of Affordable Housing, Inc. (POAH) 

was the winner of one of the first implementation grants. POAH received a grant 

to transform the 504-unit Grove Parc Plaza Apartments in Chicago into Woodlawn 

Park, a new mixed-income, mixed-use development that will be the anchor for a 

comprehensive Woodlawn revitalization. With its $30.5 million Choice Neighborhoods grant, POAH expects to leverage $272 million of total development in the 

area over the next 5 years. The city of Chicago is a key partner in the project’s implementation and many other community organizations will also participate including the Woodlawn Children’s Promise Community (WCPC), the Woodlawn New 

Communities Program, and Metropolitan Family Services. 

The POAH plan highlights both the capacity of this strong, national, nonprofit developer to lead a complex development process as well as the ability of the Choice 

Neighborhood Grants to catalyze a major change in a community. Through the process, POAH will demolish the existing, distressed apartment complex and replace it 

with a healthier mixed-use, mixed-income community with 420 units and 95,000 

square feet of retail and community space. All of the affordable units in the original 

buildings will be replaced 1-for-1 through investments in other properties in the surrounding neighborhoods, in some cases repositioning foreclosed and abandoned properties to create an additional 575 units of mixed-income dwellings. 

WCPC and the Urban Educations Institute have designed a comprehensive educational initiative designed to improve access and outcomes from early childhood 

through college, for all Woodlawn children. A new, 15,000 square foot community 

resource center at the heart of the development will feature a satellite Center for 

Working Families, providing tailored skill-building and job connections to residents. 

And, the project will implement a gang violence initiative that incorporates a range 

of data-tested anti-gang enforcement strategies—including more intensive community policing and coordination with community watch block clubs and parent school 

patrols. 

I should also note that an HPN CDFI member, the Low Income Investment Fund 

(LIIF), CDFI has provided a loan to POAH in support of the Woodlawn redevelopment financing package. 

HPN members are also leading or participating in Choice Neighborhoods planning 

grants. The Community Action Project of Tulsa County, Inc. (CAP), for example, received a round one Choice Neighborhoods planning grant as the lead developer. CAP 
41 

has partnered with Brightwaters Housing Partners and McCormack Baron Salazar 

to revitalize the Eugene Field neighborhood of Tulsa, Oklahoma. The Eugene Field 

neighborhood is one of Tulsa’s poorest and most isolated communities. It has experienced a violent crime rate more than double the rest of the city. The Brightwaters 

Apartments in the neighborhood is a 200-unit HUD-assisted property. In addition 

to redeveloping this property, the local effort will leverage existing volunteer-led activity in the community with a state-of-the-art preschool, a fresh foods market, and 

a new playground. The project is expected to move Brightwaters toward a mixedincome development and include expanded CAP efforts to link the residents of the 

community to supportive services and job opportunities. 

Columbus, Ohio-based National Church Residences (NCR), a national nonprofit 

that owns and manages 20,000 units in 28 States, is a key partner and co-grantee 

in a project led by the Columbus Metropolitan Housing Authority that also includes 

Ohio State University and the city of Columbus. Their project would redevelop a 26- 

acre site known as Poindexter Village as well as the surrounding neighborhood. 

Omni Development in Providence, Rhode Island is participating as a key partner 

to the Providence Housing Authority in a planning grant around a proposed redevelopment of the Olneyville neighborhood. The Community Preservation and Development Corporation (CPDC) in Washington, DC is a partner on a planning grant 

awarded to the District of Columbia Housing Authority, Kenilworth Courts, and the 

Kenilworth-Parkside Resident Management Corporation. CPDC owns and manages 

the Mayfair apartment complex which is an anchor asset in the community targeted 

for revitalization. 

Policy Observations and Proposals 

This practitioner-based experience serves to inform the suggestions we would 

make to this Subcommittee as you move to mark up the Choice Neighborhoods legislation. We would like to make these comments for your consideration: 

1. Institutionalize the program. It is important to put an authorization in place. 

While the Choice Neighborhoods program is up and running already, this is due to 

the actions of the Appropriations Committee. We are hopeful that Congress will continue to advance this important work in future appropriations acts. However, an authorization would provide a more predictable framework for the program. Choice 

Neighborhoods implicates many long-standing, difficult public policy issues. Affordable housing program design is often about choosing between place-based and people-based strategies, about the sometimes competing desires to create mobility and 

choice for households to seek opportunity versus focusing on building communities 

of opportunity. Policy makers need to think through the challenges of balancing the 

positive impacts of new investment and regeneration on surrounding property values with the sometimes negative effects of rising rents and displacement through 

gentrification. These are all perennially challenging public policy issues reflecting 

competing values. The HUD program implementation is addressing these issues, but 

future policymakers will be tempted to revisit all of these issues and can do so more 

readily in the current legal environment. In short, the lack of a permanent authorization makes the future development environment uncertain. 

Real estate development requires extensive planning activities and a long lead 

time. Acquiring land or property and holding it is expensive. In the case of Choice 

Neighborhoods eligible efforts, the upfront costs will, of necessity, be elevated as 

partnerships across multiple disciplines are formed and formalized. Many HPN 

members—who are the types of organizations one would like involved in the development process as strong counterparties—have not stepped up to compete because 

of the uncertainty in program funding, lack of an authorization, and uncertain probability of success. When the program funding levels and its rules are institutionalized the strongest players in the not-for-profit sector will be more willing to absorb 

the upfront costs and take on the risks to compete. A predictable grant-making process over multiple years will increase the strength of the applications. It is important 

for this Committee to put in place an authorization that provides more permanent 

guidance and a lasting authorization framework. 

2. Embrace the equivalency of publicly owned and privately owned distressed 

housing. Distressed housing has identical impacts on the people who live there and 

on the neighborhoods that surround that property. We would recommend that the 

Choice Neighborhoods program move toward a level competitive playing field unrelated to the ownership of the properties. With limited resources at the Federal level, 

Congress should set up the competition for Choice Neighborhoods grants devoid of 

set-asides for one type of housing, or one type of developer versus another. Projects 

should compete head to head for the public resources based on the strength and experience of the lead development counterparty, on the quality of the cross-silo part-
42 

nerships committed to the development, on the leverage achieved in bringing in 

other nonpublic resources, and on the quality, assurance, and effectiveness of the 

intervention on the lives of the residents living in these communities. The competition for the resources will allow the very best projects to rise to the top and the 

Federal Government will maximize the social return on its public investments. 

3. Continue to Encourage Multi-disciplinary Approaches. It is important that 

Choice Neighborhoods legislation continue to push for a more holistic approach to 

community development at the local level. The central challenge with Choice Neighborhoods is how to use HUD funding for a specific real estate transaction to drive 

a much broader program of community change. The legislation deals with this challenge by using HUD funding for housing redevelopment and allowing a certain 

amount of the grant to pay for community improvements and services as an incentive for localities to bring other funding such as transportation, job training, or 

school construction. Federal officials must also be encouraged to act in a multi-disciplinary manner. Resources from the various relevant Federal programs have different rules, different timing, and different institutional delivery systems that serve 

as a barrier to local leaders accumulating the funds need to address the range of 

needs in a particular place. There are reasons for all of the different program requirements. This is not something that can be solved quickly or easily. The Administration deserves great credit for its work to break down the programmatic silos 

across the range of relevant Federal agencies. For example, under Secretary Donovan’s leadership, HUD has been working closely with the Department of Transportation on coordinating housing and transportation policy. More can be done by Congress to encourage and facilitate the coordinated delivery of Choice Neighborhoods 

with other Federal resources. 

4. Assure Adequate Funding for Both Choice Neighborhoods and Other Core Affordable Housing Programs. Within the Housing Partnership Network there is a significant concern that the increasingly constrained Federal discretionary appropriations picture is pitting funding for one Federal housing program against another. 

This is felt most keenly through the pressure on critical affordable housing tools like 

the HOME program and the project-based Section 8 accounts. Both programs are 

essential in the production and preservation of affordable housing in this country. 

HOME is a very important and successful block grant program, providing gap funds 

that allow development and preservation projects to move forward. HOME has been 

wrongly maligned in the press recently and as a result has suffered some serious 

cuts in the appropriations process. We are also working with Congress to restore 

the HOME funds and to fully fund the Section 8 program. 

In this era of hard caps on appropriations, some perceive that funding for Choice 

Neighborhoods could come at the expense of funding for core programs like HOME 

and Section 8. This is a false and unfortunate choice. Each of the programs addresses a different, yet critical need. We need to identify sufficient funds to do both. 

Conclusion 

In closing, Mr. Chairman and Members of this Subcommittee, I would like to reiterate how important the work you are doing is for America’s urban, suburban, and 

rural communities. In all kinds of places, federally assisted properties that have fallen into distress for any of a variety of reasons—the natural aging of the asset, inadequate funding, over-leveraging, a change in market conditions, a change in tenancy, and poor property management. Whatever the cause, these properties have 

had a negative effect on their residents and the surrounding communities. The presence of these properties is pulling down values for blocks and sometimes miles 

around. The blight at the center of the neighborhood can keep people from buying 

homes nearby and can prevent new investment coming in. A public investment like 

Choice Neighborhoods can change the negative market dynamic and send the property, the community, and most importantly the lives of the people who live there 

on a new positive upward trajectory. Thank you. 
43 

~ Housing .. Partnership 

'" Network 

Housing Partnenbip Ne(workMembership List 

Abode CommwUties 

ACTION-Housing, Inc. 

Aro, 

Affordable Housing Partnership 

AHC,Inc. 

Atlanta Ntighborbood Dcvdopmmt Partnmhip, Inc 

BeUwethcr 

Bos\on Community Cipital 

BRiDGE Housing ~orporation 

Capitol Hill Housing 

Chmlplain Housing Trust 

ChiC.lgo Community Loan Fund 

Chicanos POI La Causa 

Qc\"t!and Housing Nawork 

CommoD Ground 

CommonBond Communities 

Community Action Proi«1 ofTulsa County 

Community Ocvdopmcnl Corporation of Brownsville 

Community Dc\'dopment Corporation of Utah 

Community Housing Partners Corporation 

Community Pr~nvalion and Denlopmrnl Corporation 

Community Reinvestment Fund 

Community Smices of Arizona 

Community V mtUlcs Corporation 

Co\'mant Community Capital COlpOration 

Dallu Cit}, Homes 

Eden Housing 

Family Housing Fund 

Federation of Appilachian Housing Enterprises 

Foundation Communities 

Grw Lakts Capital Fund 

Gre~ter Metropolitan Housing Corporation 

Gre~ter Minnesota Housing Fund 

Greater Rochester Housing Partnership 

GulfCoasl Housing PartDc:rsbip 

ATTACIDIDT A 

Los Angdes CA 

Pittsburgh PA 

Minneapolis MN 

Albany NY 

Arlington VA 

AtlantaGA 

Seattle \VA 

BostonMA 

San Francisco CA 

Seattle \VA 

Burlington VT 

Chicago IL 

Photnix AZ 

Qtveland OH 

New York NY 

S1.Paul ~iN 

Tuln OK 

BrowDsville TX 

Salt Lake City UT 

Christiansbwg VA 

Washington DC 

Minneapolis MN 

Chandler AZ 

Lexington KY 

Houston TX 

Dallas TX 

HaywardCA 

Minneapolis MN 

Berea KY 

AustinTX 

Lansing MI 

Minneapolis MN 

Saint Paul MN 

Rochester NY 

New Orleans LA 
44 

HAPHousing 

Hean1and Housing, Inc. 

Hispanic Housing Development Cmporation 

HomepoIt aka Columbus Housing Partnership 

Homes for America 

Homewise 

Hope Enterprise Corporation 

HousingAssistance Corporation 

Housing Development Corporation MldAdamic 

Housing Development Fund 

Housing Partnership De\"Clopment Corporation 

Housing Partnership. Inc. 

IFF 

Indianapolis Neighborhood Housing Partnership 

LINC Housing Corporation 

Long Island Housing Partnership, Inc. 

Low Income In\'estment Fund 

Massachusens Housing Investment Corporation 

r..-Jercy Housing 

Metro Community Development. Inc. 

Metropolitan Boston Housing Partnership 

MidPen Housing Corporation 

Minnesota Home O\\llership Center 

?o.fississippi Housing Partnership 

Montgomery Housing Partnersbip 

National Affordable HousingTrust 

National Church Residences 

National Community Renaissance Rancho 

National Housing TrustfEnterprise Preservation Corporation 

NCB Capitallmpact 

Neighborhood De"elopmmt Foundation New Orleans 

Neighborhood Housing Services of Chicago 

Neighborhood Housing Sel"\'ices of New York City 

Nevada H.A.N.D., Inc. 

New Community Corporation 

New York Mongage Coalition 

NHP Foundation 

Nonh Carolina Community Development Initiati\'e 

Ohio Capital Corporation for Housing 

Omni Development Corporation 

Planning Qffice; for Urban Affairs. Inc. 

aesen'a!iog of M fo!dablS H2using, lBs. 

Progressive Redevelopment. Inc. 

PIojest f2r Pride in Uving, Inc. 

Raza Development Fund. Inc 

REACH Community Development. Inc. 

Springfield MA 

Chicago n. 

Chicago n. 

ColumbusOH 

Annapolis MD 

Santa Fe NM 

Jackson MS 

Hyannis 1\1A 

LancasterPA 

Stamford CT 

New York NY 

Louisville KY 

Chicago n. 

Indianapolis IN 

Long Beach CA 

Hauppauge h'Y 

San Francisco CA 

Boston MA 

Den\"CrCO 

Flint r..n 

Boston MA 

Foster City CA 

SI. Paul MN 

Jackson M5 

Silver Spring MD 

ColumhusOH 

ColumhusOH 

Cucamonga CA 

Washington DC 

Arlington VA 

NewOrluns LA 

Chicago n. 

NewYork h'Y 

Las Vegas W 

NewarkNJ 

NewYorkh'Y 

Washington DC 

Raleigh NC 

ColumbusOH 

Providence RI 

Boston ~1A 

Boston MA 

DecaturGA 

Minneapolis MN 

PhoenixAZ 

Portland OR 
45 

Reli~ous Coalition for Community Renewal 

Rocky Mountain Communities 

San Antonio Housing Trull Foundation 

Senlement HousingFund 

Siou, Empire HousingParmership 

South County Housing 

South Shore Housing 

Southwest ~£nnesota Housing Parmership 

SI. Ambrose Housing Aid Center 

Tarrant County Housing Parmership 

Tenderloin Ndghborhood Del'el",ment Corporation 

The Caleb Foundation 

The Housing Parmership 

The Housing Trull 

The Phipps Houses Group 

The Reinl'esooent Fund 

Wesley Housing Development Corporation 

\\1sconsin Partnership for HousingDevelopment 

Charleston IVV 

Denver CO 

San Antonio TX 

New York NY 

Sioux Falls SD 

GikoyCA 

Kingston MA 

SlaytonMN 

Baltimore MD 

Fon Worth TX 

San Francisco CA 

Swampscott ~1~ 

Charlotte NC 

Santa Fe NM 

New York NY 

Philadelphia PA 

Alexandria VA 

~dison \\~ 
46 

Coolition for Choice Neighborhood, 

Stu~ r Jim JO hD ~OI I 

CliaU1lUll.. StNte Comllutt~ on B~nkmg. HOl\img 

and timan Allam 

534 Dubtn $lmle Offia Bmldm,g 

Wa;hLIIgJou. DC 20510 

S.uatol' Rirhud C. Sb. lby 

R2IlkingMmlhtr. S<nl!C'COn1!mu~ on BwUl!. 

Hou$m~ and uro:mAffaln 

SH Dirbm Smale Office BlUldmg 

Waslungton., DC 20510 

April !. 2011 

ThtlllKiffll!)ltd clfi~.md publlc.md pri\'~ orgaW211I<1n~ aft IIT1!lD,!' 10 ur~ dIal you II1duM fund!!\!: 

for ChOlCt Nelghborhoo<k n CougrtSS fmaum die fi~l re;u- 2011 ~ptlldlllg bill for the DqlmlllWt of 

Hoo\mg~nd Urban De\'C'lopmem, ChOlet Nelgb1:'OIiloods bUlld~ on tht kpcy of llle HOPE VI program 

by pr0\1d!ng gran!! ro fund [be ~f()f!ll~IJOQ ofHtiD-a\\I\led public and pril"e]YOII'lltd 1I1uJllf3llllly 

bOUl,IIll 

ChoIce NC'\gbbollloo& vvt\ loul (onununine~ ~ 100\10 lJandOflll dl\tfes~ nel~hboJhoo& UIIO 

luslaUL1ble IlUXM-UKCI!le uel~hbothOl:l<k \11th ~ ~fford.Jble blllmug ..... fe \tretl\,, :md1OQd r.chooll 

e.~' f:auJily ~ds. Cboice Ntlghborhoods pam;, ate prim3ril.y used for 1M rtdtnloprutm of public.Uld 

HUD·:W;l~rtd hou\Ulll, bUl theyanle\"lnge a \'aMI}' offM=l ~t~r ,IOCJl and prL\';Irt rnoU/'fe<i 10 

Illljlltmtlll {ollIprtlll.'.ll~L\'t IX'Ighborbood fe\1l~lwhO:l ~lIJltgie<i , 

1M cro.lkugt~ for cOllllmLlll i~ cauwj by COOCtlllfahOll$ of portft}':nld tht blight of lstm~d 

mul lf~ uly t~ll'mrt .uenot linultd 10 tht pub~c houlJng 10'1'<'11101)' PubL.c hOlmng and othI'T Hl.J1) 

a.sisltd OOUlUlg ale ofitllloc2rtd within IItt >aDlt nel~anJ rom'c f:Jllllbtl wub eurtllltly low 

UlCOII1ts who art sinular w IIltlf uNd., ChOlet Neighborhoods is a wOfthy 511C(tsSOf to HOPE ", thaI 

aUow'$ for !be ~nrahlaiion of borb pubbc hoUI\Di iJld orbtr Hl.J1)..~~SISled ruulrdinuly bou,l!li, 

Cho,Ct NeIghborhood. ~ au inoorariR OOlilllC ~pproach tro.ll~'mg!'>p l\'3re ICSOllfCfi 10 ;rd.drt$s 

bhght thll onn! SUll1)III\dS failed OOUSiJl)! Lkrtlopmwts, Cholce Ntighborbood~ 1\111 Cfnle jobs and therc 

WIll J.!IO be a ripplr dfecl !I1thl' relwed comnmQltle~ that will now attt:ICI addibOlUi ponte 1lI\'eitLUmr. 

LIkt the HOPE VI proFfanl. ChOICe NtI~hborhoodiplesem\ an opponumly to thlllk about ~ 

rt&nlopmem oibousmt,not simplY:li a 'bricks 1I1d 1Il0rlM' extfCise, but al!oO 311 platfor:u for larger 

eomm\Lruty rt'.lt:lltlal1On, As ~ courpre!Jellsll't, plact>-b.ased approach to sm1ng botb ptople and 

neighborhood~. the pro!Jam holds a peat Lkal of prODll~JS the way 10 ~duce po\"nty and IIltome 

m~ualilj', 

Chotce Kelghbofhood~ IS a CtllttJ.! drnle!\r OrlllC AdmmrslrallOn'$ Nelghbocbood ReI"ltalluuon lrurilti\"~ 

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tU'iplbnrhoods 11110 nelghbofhoodl of oppomwil}' ~ Nt:ghborhood Rt<m~lw on IruUlILI"e brmgs 

logcthtr ffil1) and the DcpMtmentl ofEchlo:auon. Hulth :mdHun~m Sm'lCtIo and J\L\lICC 10 collabon.tt 

10 gn't eomJnl.llllh~ lx1tC'f Kem to lhe \"anety offederal progr.un~ {bilt :lddre" complex problems in 

10w-IILrome ne,ghboriloIXh" 
47 

HliD m~iwd 161 applicaliWl; for the 2010 fuudmg round fOf ChoIce N~borhoods md could only 

f\lnd len thm ~S of1~. nils dnuand dmlOllSIfl\\('S Tbe 1\1~u\ OftM Choice Nnghborhoods aPPfoilCb 

of ,mng localiTIes a 100110 de~ll\'Th unghborhood dysfllllC!lOlI txaCnbatcd by dISTressed hOlllmg 

del·dopruelllS. This IS the iiIDC' to fund !Ius Thoughtful, cQ!,t-cffeCll\~ program. ThallI.: you fOf your 

cOlIsloiera1lO1I . 

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Cny of SiUI ffiUlci5(o 

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Edtn Homing. loe. 

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locaI1oJ.Ilall\'ts 'Support CosporallOll 

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!tfCy Homu\y 

Xafl()[lJI Housing & RehahlJilJbO!l AsSOClabon 

Xalloml HO\lllllg Troll 

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Ptupo!.e Bmh CO!UlDIlll.Lfles, LtC 

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Stcwards of Affordlblt Housing for The fUlW't 

The CO!ll!llUil.lI)' Bmldm. Inc. 

The Ill!cgrai Group 
48 

PREPARED STATEMENT OF EGBERT L.J. PERRY 

CHAIRMAN AND CHIEF EXECUTIVE OFFICER

THE INTEGRAL GROUP LLC 

MARCH 27, 2012 

Good morning Chairman Menendez and Members of the Subcommittee. My name 

is Egbert Perry. I am Chairman and Chief Executive Office of The Integral Group 

LLC, a private, for-profit real estate firm focused on implementing urban development projects nationally. I am honored to have the opportunity to come before you 

this morning to give you my testimony in support of ‘‘The Choice Neighborhood Initiative: A New Community Development Model.’’ This initiative would help to transform distressed neighborhoods and public and assisted projects into viable and sustainable mixed-income neighborhoods by linking housing improvements with appropriate services, schools, public assets, transportation, and access to jobs. My support 

comes not only as a result of my appreciation for the obvious public policy case that 

underpins the proposed legislation, but also from my experience as a practitioner 

in the private development marketplace. 

INTRODUCTION 

Integral is a 20-year-old firm, headquartered in Atlanta, Georgia. During that period, we have undertaken projects in many cities across the country, including 

Washington, DC, Baltimore and Atlanta. 

Unlike many real estate companies, our firm undertakes both a) conventional 

(commercial) real estate development and b) community development. As we all are 

aware, commercial real estate development is ‘‘transactional’’ and, therefore, focused 

almost entirely on providing maximum economic returns to the investors and developers from the transaction in question. 

On the other hand, our community development approach seeks to be ‘‘transformational’’ with respect to the building of communities. Like some of the other 

community developers, we come to this work with a commitment to transformation, 

while simultaneously seeking to achieve a reasonable profit. In order to transform, 

rebuild or revitalize communities, our core strategy is designed to leverage resources 

to restore the functioning of normal market forces, thereby minimizing the ongoing 

dependence on public funding to sustain the communities. This public-private partnership model is critical to successful community development initiatives, and the 

public dollars must be positioned to leverage private resources and private investment. Since the private sector partners in these undertakings are expected to bear 

the guarantee and market risks, they must be able to manage and mitigate their 

risk, without ignoring the public policy priorities. Accordingly, there are several 

metrics that we use to measure success. They include: 

1. Solid economic returns on invested equity; 

2. Positive economic and social outcomes for the community residents; 

3. Positive economic development impact on surrounding/adjacent communities; 

and 

4. Positive economic impact on the local political jurisdictions (i.e., City, County 

and State). 

BACKGROUND 

It is this multi-faceted solution that the very best HOPE VI developments tried 

to achieve over the past 15 years. The Choice Neighborhood Initiative (‘‘Choice’’) improves on the lessons learned from HOPE VI and provides a path forward for 

achieving greater and more long lasting positive outcomes, by making some ‘‘nice 

to haves’’ under HOPE VI (such as linkages to education, working through nonpublic housing authorities, etc.) essential elements of the more ‘‘integrated’’ Choice 

program. In time, the success of this program should be reflected in a consistently 

higher level of quality in the development solutions that are produced under Choice. 

Our firm has been involved in the development of over 10 HOPE VI developments 

nationally, as well as other affordable, non-HOPE VI developments. This has helped 

me appreciate the potential benefits that Choice offers by reflecting on Centennial 

Place, the nation’s first HOPE VI development. Coincidentally, it was developed on 

the site of the nation’s first public housing project, Techwood Homes, and an adjacent public housing project known as Clark Howell Homes. Centennial Place was 

implemented by a public-private partnership that included The Integral Partnership 

of Atlanta, a joint venture between The Integral Group and McCormack Baron & 

Associates another private developer, and the Atlanta Housing Authority. 
49 

At the time of our engagement in 1994, the 60-acre property contained 1,081 severely distressed public housing units, 674 of which were occupied by households 

that had an average annual household income of $4,300. The remaining units were 

vacant and uninhabitable. Captive to the property was an elementary school that 

was the second poorest performing elementary school in the Atlanta Public School 

system (‘‘APS’’). APS was ranked near the bottom of school districts in a State that 

was ranked 49th in the country. At the time, the crime rate at Techwood/Clark 

Howell Homes was 35 times the average rate for violent crimes across Atlanta, 

which according to law enforcement reports was one of the most dangerous cities 

in America. Suffice it to say that, like many others, this site of concentrated poverty 

was a ripe breeding ground for producing young people that could never successfully 

compete at home or in this globalizing society. Over 50 percent of the residents of 

the projects were children and approximately 25 percent were senior citizens. Working adults were nearly non-existent despite the employment opportunities that existed down the street at Georgia Tech. 

The vision that we conceived for the new community that we would eventually 

create sought to answer one basic question: Is it possible to create a mixed-income 

(subsidized and market rate) community on the site such that people of reasonable 

means would choose to live there? We answered in the affirmative and set out to 

do so. At the outset, our public-private partnership adopted five strategic goals that 

addressed the public policy priorities, while employing sound private business principles as the foundation for planning and implementing the vision, as follows: 

1. Leverage the Federal resources by attracting considerable local public resources, private philanthropic funds, as well as private debt and equity capital, 

to finance, develop and manage a new mixed-income community that would be 

healthy and sustainable over the long term. 

2. Ensure that the development efforts positively impacted an area that was significantly broader that the primary 60-acre site. 

3. Pursue a strategy to mainstream the public housing residents into the broader 

community, while providing counseling and other program support to help 

them in their transition toward self-sufficiency. 

4. Build the human transformation efforts on a foundation of education, job training and employment. 

5. Assist the Atlanta Housing Authority in achieving its own economic sustainability by generating additional sources of income to complement the shrinking 

Federal funding. 

Centennial Place, the new community that was eventually created on the site, 

contains the following components: 

1. Mixed-income residential development, comprised of 738 multi-family rental units and 45 homeownership units with a mix of public housing assisted 

households (40 percent), other low-income households (20 percent) and market 

rate households (40 percent); These components were financed using a combination of Federal funds, private equity and private debt. Infrastructure improvements (i.e., upgrades to roads, sewers, etc.) were funded using previously 

allocated Federal resources, tax-exempt bonds and direct water, sewer and 

transportation allocations from the capital budgets of the city of Atlanta. 

2. A complement of coaching and counseling services delivered to youth, 

young adults and seniors in assisted households to facilitate the transition to 

self-sufficiency. 

3. Two early childhood development centers, operated by established service 

providers, and funded by private philanthropy; These centers offer crib to kindergarten development services to all families; 

4. A new high performing public school offering a Math, Science and Technology theme, as well as an Arts program; This school represents a collaboration between the private developer, AHA, the school system and Georgia Institute of Technology (Georgia Tech). 

5. A Family YMCA, funded primarily from private philanthropy, and operated 

by the Metro Atlanta YMCA. In addition to some private foundations, the 

YMCA enjoys the support of a number of anchor institutions that call the 

neighborhood home. 

6. Miscellaneous retail and other complementary uses that help to provide a 

quality of life experience; 

The results have been extremely positive. 
50 

1. The presence of the high-performing elementary school has supported the 

motto that great schools are essential to create for a great middle class neighborhood. There has been an increase in the demand for housing in the 

school’s zone, and the outlook for real estate values is positive. For the first 

time in recent decades, with Georgia Tech and Techwood Homes/Centennial 

Place as next-door neighbors, a student that grew up on the 60-acre site has 

successfully matriculated to Georgia Tech. In fact, many of the students that 

went to Centennial Place Elementary School have since gone on to highly selective colleges and universities, including Princeton, Michigan, the schools at the 

Atlanta University Center and Howard. 

2. The members of the families that lived in community before the development, 

and were relocated, have seen significant improvement in the circumstances of the families receiving assistance, especially with respect to 

workforce participation and educational attainment, as attested to by academic 

studies conducted by Georgia Tech, Emory University and Georgia State University. Further, the ones that exercised their choice to live in Centennial Place 

saw even greater gains, particularly due to the presence of the excellent quality 

of life infrastructure (school, YMCA, etc.) that are now readily available and 

accessible to them. 

3. The significant reduction in the use and cost of public services (police, 

fire, social services, etc.) in the zone in which this site sits is well documented. 

The area’s safety is now on a par with safe neighborhoods throughout the city. 

4. Extensive private development activity in the surrounding area has taken 

place. Much of this development would not have taken place if Centennial 

Place (which represented (a) a break from the old model that concentrated poverty, (b) the introduction of private sector involvement and market principles 

and (c) higher expectations and standards for personal responsibility) had not 

been created, or if some version of the old Techwood Homes (even with a facelift) remained. Within a two block distance south of the site, we have seen the 

development of the $300 million Georgia Aquarium, the $200 million-plus 

World of Coke Museum, the Children’s Museum, and Allen Plaza, the one million square foot mixed-use development of high rise office buildings, hotels and 

condominiums. Other significant private development projects have been announced, including the planned National Center for Civil & Human Rights. 

5. To the north, Georgia Tech has removed the physical and psychological barriers that have separated it from its southern neighbor for over 50 years. It 

is converting that corridor into its gateway to the campus. To the west, Coca 

Cola is expanding its headquarters and reaching out to the community, having 

made significant financial and other commitments to the school. 

6. The City and County have seen this very large tract of land (including the 

project site) placed on the tax rolls and now contributes to their tax 

base after decades of receiving no tax revenues from these parcels. 

7. In one of the ultimate signs of progress, the site and the census tract in 

which it sits is no longer considered ‘‘impacted’’ and eligible for the 

many public incentives for which those development areas typically qualify. 

In essence, most of the ingredients for economic sustainability are firmly in place. 

WHY CHOICE?—THE CASE 

Thus, if the answer to the overarching question of—‘‘Why the Choice Neighborhood Initiative?’’ is not already obvious, it can be explained in the following way: 

1. Choice is built around the recognition that solutions should be developed locally and not at the Federal level. 

2. By virtue of the eligibility criteria, Choice ensures that grants are only awarded to those jurisdictions and communities in which the spirit of collaboration 

has been well cultivated and the critical planning and other ground work that 

results from such collaboration is evident before funding support is provided. 

This will surely reduce implementation timelines, though revitalization 

projects are still time-consuming undertakings. 

3. Many of the critical community building components that were discretionary 

under HOPE VI are mandatory under Choice. Those components tend to be directed toward addressing the poor human condition that exists in many of the 

targeted communities, and which has been facilitated by public policy over decades. 

4. Under Choice, there is a clear recognition that public housing projects are not 

the only distressed developments where despair and concentrations of social 
51 

ills exist. In fact, in many communities, some of the other subsidized developments are in as bad a shape, or worse, than much of the public housing stock. 

Those developments are often responsible for retarding neighborhood recovery 

efforts. Appropriately, Choice offers local communities a chance to leverage 

critical Federal resources on a broader footprint, thereby expanding the revitalization impacts. 

5. Choice ensures that Federal funds are catalytic, and that the local governments are the primary source of the public funds necessary to address most 

of the infrastructure and service challenges that must be confronted, especially 

as the revitalization spreads to the surrounding neighborhood and requires further public investment. 

6. Choice encourages local jurisdictions to seek out the best partners in the private sector to help conceive and implement these very complex community development plans that require attracting resources from private financial institutions. 

7. The stimulus effect that Choice funds can have on expanding the revitalization 

boundaries results in considerable temporary and permanent jobs that will be 

generated. 

CONCLUSION 

A minority of individuals has suggested that HOPE VI was not successful, and 

have gone even further to suggest that Choice is likely to yield the same results. 

Undoubtedly, they are measuring the wrong indicators or are not basing their judgment from observations on the ground. I strongly argue that: 

1. Those individuals have not been talking to the many families that, though initially skeptical, have found themselves thriving after what proved to be a brief 

period outside of their comfort zone. Though the last few years have adversely 

impacted most families of all stripes, the financial condition of the households 

that relocated from the housing projects has improved dramatically since leaving the extreme concentration of poverty in those old communities. Their children are performing better in school and are more engaged generally. 

2. They have not been talking to the local business communities that now find 

opportunities for development and investment in large swatches of the City 

that, heretofore, had been considered off limits or undevelopable. 

3. They have not been talking to families that are moving into the neighborhoods 

because of the presence of a high-performing school. 

4. They have not been talking to the City and County governments that have 

used HOPE VI projects to de-concentrate poverty, resulting in the simultaneous reduction in the demand for public services and the increase in the contribution to tax revenues in those areas of the City where such developments 

have been successfully undertaken, generally improving the livability of the 

City. 

5. They have not been talking to the public redevelopment agencies that have 

been able to use their economic development tools to drive and achieve meaningful community economic development outcomes across the city by sponsoring the expansion of this community development approach. 

6. They have not been talking to the investors and lenders that find these communities to be places where they are able to perform responsible and profitable 

community investment and lending. 

The implementation of the Choice Neighborhood Initiative is not without risk, as 

it requires that the goals, objectives and funding of several Federal departments be 

aligned so that the aspirations articulated in Choice can be achieved. Those departments include Housing & Urban Development, Transportation, Education, Health & 

Human Services, among others. Ultimately, the community revitalization initiatives 

will be deemed successful when they remove the non-economic hurdles and re-engage the private development marketplace on the primary site and in the surrounding areas. 

It has been said that for every 1 percent increase in the high school graduation 

rate nationally, there is a $1 trillion increase in the country’s GDP over the life of 

those graduates. The result of replacing broken and isolated communities in our 

country with healthy, nurturing, connected and sustainable communities that unleash more of our human potential should be near the top of our priorities if we 

are serious about regaining our global competitiveness. 
52 

ADDITIONAL MATERIAL SUPPLIED FOR THE RECORD

PREPARED STATEMENT OF MITCHELL J. LANDRIEU 

MAYOR, CITY OF NEW ORLEANS, LOUISIANA

MARCH 27, 2012 

Chairman Menendez, on behalf of the citizens of New Orleans, I am honored to 

submit this written testimony for the Subcommittee’s consideration affirming the 

value of the Choice Neighborhood Initiative and the transformational impact it will 

have on the City of New Orleans. Thank you for affording me this opportunity. 

The Choice Neighborhoods Initiative takes an inspired step toward the way we 

should build our cities and the way government should act at the local, State and 

Federal levels. By working from a place-based perspective informed by on-theground realities of people, New Orleans is coordinating and targeting responsive investments for tangible outcomes that benefit its citizens. My administration has 

adopted the principles of ‘‘facilitate, link and leverage’’ for all projects and programs—and that’s exactly what the Choice Neighborhoods Implementation Grant 

will allow us to do in the Iberville/Treme Neighborhood. 

New Orleans has had significant history with Federal housing initiatives like 

HOPE VI, which transformed many of our public housing developments into new 

communities with their own unique character and design. And while we are pleased 

with the improved housing found at Faubourg Lafitte, Harmony Oaks and Columbia 

Park, we understand that these projects still followed a model of concentrated reconstruction directly on the public housing sites. When the city of New Orleans responded to the NOFA for the Choice Neighborhoods Initiative Implementation 

Grant with its partner, the Housing Authority of New Orleans (HANO), we recognized the immediate alignment of Choice Neighborhoods with our own approach to 

develop housing, neighborhoods and people in a holistic way. We knew this program 

would help the city of New Orleans redevelop the Iberville Housing site not only 

to benefit the citizens who will call that historic location home, but to benefit the 

city as a whole with targeted linkage to offsite projects we had begun, such as the 

recently completed Armstrong Park and the planned Lafitte Greenway that will link 

Iberville across town to City Park. We were proud and excited by the $30.5 million 

Choice Neighborhoods Award, even more so by the fact that we can leverage over 

$1 billion in private, nonprofit, and other investments into the community. 

Essentially, what the Choice Neighborhoods Initiative has allowed us to do that 

no previous Federal grant program had, is use public housing re-development as the 

launching pad to link and leverage other Federal and local investments—to go beyond the footprint of the public housing development and transform the whole 

neighborhood with infill housing, blight removal, infrastructure and parks. I am 

hard pressed to remember any time when a Federal program and local development 

strategy were so well appointed to work together. It seems that our administration 

was putting the principles of Choice Neighborhood on the ground before we even 

knew about the grant. 

One example is the work between the city and our schools, which we see as a key 

component in our plan for community revitalization. Our application brought the 

City, the Housing Authority and the Recovery School District together to act as contractual partners, for the first time, with a mutual goal of improving the lives of 

residents in the Iberville development and the surrounding community. We are 

working with the Recovery School District to see that our schools build strong communities and our communities build strong schools. New schools for both the Recovery School District and the Orleans Parish School Board are being constructed 

under a $1.8 billion dollar settlement from FEMA. Lagniappe Academies, a new K– 

12 charter school modeled after nationally renowned Amistad Academy, is intentionally located in Iberville/Treme to serve students from the Iberville and Lafitte 

housing developments. 

The Recovery School District commits in its Reform Plan within 5 years to: 1) develop teacher and school leader effectiveness; 2) implement comprehensive instructional reform strategies; 3) extend learning and teacher planning time and create 

community-oriented schools; and 4) provide operating flexibility, and sustained support as recommended by the U.S. Department of Education’s Title 1 Improvement 

Strategy. The Choice Neighborhood study area will benefit greatly from these targets once they are achieved. 

With housing as a primary driver of the Choice Neighborhood Initiative, the city 

of New Orleans and HANO are committed to replacing all of the current 821 public 

housing units and fulfilling the promise to de-concentrate poverty and increase 

housing choice for our lowest-income residents. Moreover, the Choice Neighborhoods 
53 

program continues the tradition of HOPE IV’s commitment to residents through job 

training, education, and assistance moving to self-sufficiency—and expands into 

linkages with our public and charter school systems—to make concerted change that 

will last into the future—not just the duration of the grant. This change will also 

occur through the ultimate build out of over 2,000 total units across the Choice 

Neighborhood area. 

The Choice Neighborhoods investment offers the opportunity to link housing redevelopment with our work to revitalize health care access and public safety strategies. When you look closely, you will see that there is hardly any municipal effort 

that is not connected to our Choice Neighborhood physically or programmatically. 

As a laboratory of innovation, New Orleans will use this experience to instruct us 

on enhancing every neighborhood. 

Beyond housing, there are many ways Washington is helping the city of New Orleans lean forward to leverage the Choice Neighborhood Initiative, such as supporting our efforts to plan a premier medical district with the Veteran’s Administration and University Medical Center as anchors. Such districts have been key in revitalizing cities like Philadelphia, Birmingham, and St. Louis. For New Orleans, the 

opportunity to link this investment with our Choice Neighborhood Initiative training and employment goals is one example of how Choice Neighborhoods is allowing 

us to become the city we want to be by fulfilling the promise for livelihood in our 

community. In doing so, we take advantage of ever increasingly scarce government 

funds to strategically leverage private resources. 

We appreciate that at the Federal Government level, you are working to link and 

leverage your systems and programs as well. The city of New Orleans plans to take 

full advantage of your connective programing by applying for a Promise Neighborhoods Grant from the Department of Education, targeting the Treme neighborhood 

within our Choice Neighborhood area. We also look forward to implementing our 

Public Safety Enhancement strategy, provided to Choice Neighborhood grantees by 

the Department of Justice Byrne Grant. We have also been able to target our Community Oriented Policing Strategy (COPS) grant funding from the Department of 

Justice to the Treme neighborhood. 

We are a city that cares about design. In fact, it is a passion of ours. Within the 

Choice Neighborhood boundaries of Broad Street, Tulane Avenue, Rampart Street, 

and St. Bernard Avenue, our housing development will meet the high design standard for which New Orleans is universally known. Like the French Quarter and the 

musical heart of Treme, the design of every element of our new developments will 

be defined by their contexts, maintaining the best physical qualities of the Iberville 

development and its surroundings as blending across the blocks of neighborhoods 

known for their unique feel. The bottom line is wherever we build; we will task the 

design to attract market rate tenants to live seamlessly next to public housing residents. 

Although we have not yet broken ground on the Iberville site, there already is 

demonstrated private activity and interest in the area. A privately owned theater, 

the Joy, has been brought back to life and a national grocer is looking to open a 

new site in the Choice Neighborhoods area are just a few of the signs that new private investment interest is stirring in the Choice Neighborhoods neighborhood. 

If nothing else, this testimony should affirm that we, in New Orleans have an ambitious plan to improve the lives of the residents and revitalize the neighborhoods 

through the Choice Neighborhoods initiative. We will demonstrate results in a fairly 

short period of time. But achieving both near- and long-term goals will require significant spending. This is a partnership and New Orleans CNI is dependent upon 

Federal as well as State and City resources to stimulate investment across the target area. However, as you know, Federal funding is shrinking. 

In the 2012 enacted Federal budget, the reduction in the HOME program resulted 

in the city of New Orleans annual HOME funds being reduced by over 70 percent 

and cuts to the Community Development Block Grant Program reduced our annual 

allocation by nearly 40 percent. These cuts are occurring in the face of increasing 

demand for affordable housing in New Orleans. This is the same pool from which 

the city of New Orleans had targeted investments in the Choice Neighborhood area. 

Governments have no choice but to reexamine how they deliver services and invest their scarce resources. Choice Neighborhoods is the type of Federal program 

that might serve as a model for all government programs to achieve that goal, but 

we must move forward with eyes wide open about the needs of our citizens, the capacity of our resources, and this amazing window of opportunity we have in New 

Orleans to facilitate, link and leverage. 
54 

:Marcb 19, 1012 

Robm M=dez, Chair 

SOLlIe ~n}tillg SUOCOl1lll1lIl« OIl Hauling. 

TralisporlaliDll aud ConumlllllY IX\~lopmem 

528 $f1late H;u1 OfficC' Swilling 

Walllillgtoll DC 20510 

... ....-.. .. -

Jim DeMint, Ra!Wug Mem~ 

Soi.l!e Banking Subcomnull« OIl Hom:ing. 

Tnn~por13tion alid COllunuwlY IX\~lopmttll 

167 $f1late ~~U Office Building 

Walllingtoll DC 20510 

Dear Ch.1irml1l M~z aDd RmIaug Mtmber DeMine 

Slewarm of Affordable H0lI51!1g for ~ Future th.mk5 you for Iloldtug ~ llearing OIllhe Choice 

NeighOOfhoorls Progr.ml and en~ S. 624, 1M Choice Ntighoorhoods bJ/1I011'l'fl An of lOJ J, n'hJ(b 

would a! ~1lorlu ih1s. criucal pro!!f3Dl 

Stewards of Affocdable Housini for !be Fu,"*, (SAHf) rep£N1lU eleven wpruSbcated not-foc-prof,t 

IllC!llbers who acQUU't', prestf\~ ami art committed to loog-ttfIU. su,talUlble ownmllip .wd contmued 

alford.;bility ofmwtiCanlily rental propertre!i for lo\\~inCOIM fami1J.rs. ~=-- md disabled mdh,dua~, 

5roce 2003 SAHF luI promoted ils 1OOllbm' wred noriDll tb.ll $lablc. affocd.1bJe reut:ll bOUle\. Me 

entiaUy important in ~Ie'\ li\'e\. Toge-thn" SAW menlb= prm'idl-~ to ue.uJy 100,000 lowwcome bousdJold!; acros.i lilt COUllII}' 

Tb! Cbo~ Neigbborlloock Progrnn builds on ~ bipanisau S.llCc~ of !he HOPE· \0' pro!!flUl and 

WCorpor.Ites 3D 1IlIlO\"lI1l\~, Ilolis.tic approach to whing tbe dirt needs of dmres.std Ht D-:lS !~led 

boILswg. by le\'mgwg public ~ pri\"lIte I"tSOIIffts 10 add:-ess 1101 only !lit ru\lItS$td bousmg bul also !be. 

(ommuwty blight lhat ofteu 1.UTOUIIdS failed houslog developments. 

ChoIce l'eigllbortloods crUttS jo~ and resultS in ~ rippJ~ etrtcl, amaclrn,g a l"lInety of fedcrnl. S13tt, 

loeal and pri~"lIte inl"ffimetlt in ~ relivedconununines. Accordmg to HUD. Choice l\C'J.ghborboorl~ 

commUlll!le$ lel"tr.J.ged 01~SI 6 billion III pri\":lte !boom! last year alone. As a comp!"chensll·e. place· 

haloed JWfOacb to SCl"\lng botb people JIld IlOgb"oofboods, tilt progralll holds grt2r pronu~ .lS !be way to 

reducC' COIiCenlnlW pm.my ;wd [C'\1taliu dmressed COlllIlllUUlin. nOl only arolloo public bomw£ but 

othet Ht/D·asmted Im~tiranu]y OOu\ing al well. 

Tile demand for Choice M lgbborboodl"ftmdul.g lH!gnifICant. ln fiscal )u 's 2{I]O and 20] 1 alone. Hlm 

rec~l\ w 236 appbcallOl)'; from public. pnnte.;and oonprofll 5pC'IlSOflo 10 llelp ftmd the tr.ln$fonnarionof 

ffiJD-am~ted bouslllg and ~hbortloods til 31 \Ute> and tbe DlS!rict ofColuO\t)l~. How('\~. due to tllr 

llmiled aruoUlll fftJudwg~I'l illble . only J5 Cholct NelghborbClOCh projects. Iu\"e bteI funded. This 

derualld dern<:Pmtr.lles the urgent !leW for of the ChoteC' NeIghborhoods 3JIPIO:Kb. of !Iving ]onli115 a 

1001 10 dl-al \lith odghborboorl dysfuuctiDll ex.:lCtfb31ed by distrtssed 00u~i:lg del·doprnenrs. 

Sl . ... 'd. oIAffotd.w. lI o~>inc ,." \lot '''~'.{SAIIF) . Th. b.",okot 1.Io~" (IOOd s-,fu, .. s..clol.Y 

_u I .. A",~ , ~ II ... "", • ".cion.! AU .. oi.obIe 11 .... 0l0>I "\lOt , n.ti ..... t ,,",,,,<I> It~ 

n..Il .. ,.f ..... ~ .. ""' · 1<1f1 [Atw~ .... __ .tio~(,ootp . - PrlO ..... ~" l\ffo>o-<hblo 110 ... 1", 

~ ... III_.r'" r"."..ut1011 • TIwi 'om.......n, 8~1Ide( •. Volllnl ..... 0I ........ ~ • ",,,,_ .. Nne1 nu 
55 

Wt II!gt yoursuppon for!ht Choict Nelghborooods Progr.uu. and W~ 1001: forwlfd!O working with you 

OIl tlu ~ impOfl3llf inmativt 1.1 lhe future. 

Smc~ely. 

Toby fulliday 

Execulivr Vice Pre,>idtru 

Srewlfds of Affordable HOIISIllg for rile Ful\l!t (SAHf) 
56 

Rollen MClII:l\del, Cbmr 

Scum,' Banking SubcQ(QmitlN''''\ Hoo mF' 

Trnn>pon~ri() n ~lId Comrnunil), DeVcJopn~11I 

528 S~n~ e Han Offict BuilJln,g 

W3~ll1fl~1011 IX' In'i 10 

Jim ll!Mln~ RM~lnl! McmlX!f 

Scfl 'l ~ Banking Subc<Jmnlil\fe OfI Il (IUsm~, 

Tr,1nspolwllon and Conllll1lnu)' Oc.\'dopl1\"1\1 

]67 SeI13lt Russe ll Office BUilding, 

3~hing n DC 10510 

On b.:h~lf rilll<! LC'IClIJ Inillalivts Suppon COfjl<lmtioo, I would li~ t IOUlti'd my suppon (,11' S, 1'(2.:, ,Ill' 

al<J~"Nfj h/HR ll()Ol/j 1""'11/1"" Ml qf l Oll. y,'hkh wookl aulooril~!hi) critical pr\l~mlll Nt ovtr M 

yeru'S lilt L(I('~l Jililt~h\ es Suppvrl Corporali,'" (L1SC) liltS bl:tn Ikdbthl 10 hclplllg tommUllIlY 

n:!iid!nls r~/lSf(}(rn di lre s;,t'" reigh"''(hoo:l ~ into reaJlhy ~nd ustnin:l~1e communities of c'iloict anJ 

O(lflOnunil)' - good phn'~ 10 y, orl.:. 00 MUlt:.S~ and rai~ ~h11JJen. Akin l(I till' Cblm-e ~ighborh() b 

P'ro1;r.utl. L1SC's H'Ii/ti,,/: Srl.\ l,JN/jN~ C,~",,,,,,,;tirl str.n,'g)' h~, pn)l'~n 10 be;) proml:>iog ~~11I of 

hanl,l: : one Ih t IS Ik~lble, 11IJ1i)\'ahl c, 1IIld Il'"SPOOSIW 10 local (ondihOl-.s-. It rc .... hcs inl o~WI)' c'VCfIi!l')l 

afOllIfllUi1:l 1)"S 1,1/.' wllh a compI",/len, 11'C apl)fO;jCh thotl din ho:lpd~111P.· IlK' 1~'l:IOry of di~nolaged 

~ghwrh oOO~. It IS With this kn \\' Ngt';ulll",xl~rie n;,.'t' th31 11'1: ~x pre ss uurenlhusiascic uJl'f'Ol'l fur lhi ~ 

iuu!kl bw Lking pr\lgf~m 

The Choiet! Neighoorhoods flfClSf~m builds upon Ihe hipalli!l.1fl SUCCCS!~'S of the HOPE VI prugTllm by 

iucorpoMling an inrK>'o'ali\'e aud hoh C op]l'fL'lt.:h th9t SC I\tS both pt'op~ and ~I$hborbood>. Th· 

n)~1 li m aln}). 10 /'MUtt C'OlloX'ntt::II,'(j PQl\'"rty and rev italize dlsll'l'&\Cd "O mmunlll~': IlOI vnly:wood 

I'U~lj l' ho:lIlsing bu t Illso HU[).a'lsislcd 11lllllifrunily hOIIsm,g Jm;II.1st ycar Coowe Ncithoorhoods 

fI'1Inll~s k\\~a~d Ole r .51.6 billion in pnl'alt funding 1101 only 1(1 /1:vualiu j)I/1:)~d hOllSluf hut ~ Ii) 

311\:1101';11,' the blighl l,nd olhl'r conlmuni,)' di~lItl~ ~ Ihat often surrolillds failed public ~nd Assisted 

h(;(lSlIlg l£\rl()p11lrlll>. 

Th<> d!nWld f()f ('bot.: .. Neighborhood' fundi,\! i. ,;j~ ifi(W1L In fi sl.": ~ }\'.V. 2010 and 201 1 n". HUD 

/fITi,' ... d 2J/) ~ppl 3li ns klhelp lund tran,lOlmaltW d rom in 3i 1l11c~ aoJ d~ DI ~lril' "r(l.Ilumbl;\. 

Howl'vcr, iliIIll';> Ill<! lilnlled 3nl\lWII offundins ul'nilahk', only 3.~ ChoK'l! l.£hoortmods lIpr]ICtIIlQllS 

hal'(' ixocn fUlllkd. IIhkh 11l'~1lS ImD ~:\nnot n~"1 tho: int:nSf ~llIan.J this lYre of COOlOlunit), 

inkrwllliOl~ 

Tbank you for )'wr suppon fOl tb.' Cooke Neighbofb()l,.vj j l'rogr<ull, and li e oo~ f\lrw:ltd 10 wOrl.:l lll\ 

Willi }'Oll on IhlS Impotl.llllmi1l:l1iw In Ih.' fUllll ~. 

Midiacl Rllhlngcr 

l'Ie.< iJclll a,KI Chkf Elteculill: Ofli<'l1 l 

ocnl llll lnti, ~s Supp.' n C6I'por.1l1(1n