IN Statewide Conference on Housing & Community Economic Development / Midwest Summit September 20, 2011

1. IN Statewide Conference on Housing & Community Economic Development / Midwest SummitSeptember 20, 2011 Linda Couch Senior Vice President for Policy www.nlihc.org

2. Last week’s Census numbers • 46.2 million people in poverty, 2.6 more million than in 2009 • The largest number in the 52 years for which poverty estimates have been published • One in six are poor in the United States • One in three young families with children

3. The Gini Index • Measure of income inequality • Ranges from 0, when everyone earns the same • To 1, when all income goes only to one person • In 2009, U.S. Gini index was 0.468, a 20% rise in income disparity over last 40 years • Similar to Gini indexes of the Philippines and Mexico

4. HUD’s Largest Programs • Vouchers • Public Housing • Project-Based Section 8

5. Housing Choice Vouchers • 2 million vouchers in use today • Loss of 150,000 (2005 – 07) • Many improvements in the offing House subcommittee would cut more than 40,000 voucher households from program in FY12

6. Housing Choice Vouchers • Section 8 Voucher Reform Act / SESA • Rent-setting and income reviews • Inspections • Enhanced vouchers • Project-basing vouchers • Other objectives? Time limits, Moving to Work?

7. Public Housing • 1.1 million units, $26 billion rehabilitation backlog • Loss of 150,000 over last 15 years, >10K a year • Choice Neighborhoods Initiative: Continue to redevelop housing, but also focus on entire neighborhood

8. Public Housing • HUD’s Rental Assistance Demonstration • Authorize greater access to private capital • Allow conversion of PH units to project-based contracts • Choice option • Long term, renewing contracts and use restrictions House subcommittee $$: • 16% cut to operating; 25% cut to capital

9. Project-Based Section 8 • 1.4 million units • Loss of more than 300,000 units late 1990s, pace of loss has slowed • Contracts with owners backed by FHA insurance, Congress reticent to underfund but threats loom as all is on the table

10. These three programs are critical: • They are affordable to each household – bringing stability to households and communities • They are deeply income targeted • Why income targeting matters:

11. If you lined up…

12. The Gap

13. Severe Housing Cost Burdens • Of all renter households paying more than 50% of their income on housing • 78% have incomes below 30% of area median in IN • 79% have incomes below 30% AMI in OH • 76% have incomes below 30% AMI in IL • 75% have incomes below 30% AMI in KY • 73% have incomes below 30% AMI in MI

14. “Vacancies,” “Glut of Empty Homes” Incomes of extremely low income households are extremely low! • Median U.S. household income is $60,000 • Median HUD household income is $10,200 • Just 32 affordable and available homes for every 100 extremely low income renter households

15. CDBG and HOME • House subcommittee did not cut CDBG funding but would cut CDBG admin fees from 20% to 10% • House subcommittee would cut HOME program in FY12 by 25% • Cuts expected in Senate as well

16. Super Committee • Budget Control Act set up requirements for massive spending cuts over next decade • Sets 10 years of spending caps for discretionary spending • Anything short of $1.2 trillion in cuts enacted by 12/31/11 would be metered out in across the board cuts beginning in January 2013

17. Tax Reform and Deficit Reduction– what will be addressed? Low income housing tax credits • $5 billion a year • Reforms • Keep out of tax reform/deficit reduction discussion Mortgage interest deduction reform • $100 billion a year • Top 10% of tax payers get 30% of benefit (top 32% get 72%) • On the table in deficit reduction talks as well as how and whethergov’t should be supporting homeownership

18. Housing Finance Reform • U.S. take over of Fannie Mae and Freddie Mac • White House sees more limited role for feds in future mortgage market • Agree w/White House that fed gov’t has duty to low income households • ELI rental market is one that history (and current data) tell us private developers will leave behind • MF rental is ripe for public investment

19. HUD is busy, too • Happy to avoid Congress if possible • Small area Fair Market Rent (FMR) demonstration • Implement HEARTH Act, consolidating three McKinney-Vento homeless assistance programs • Amend HOME rule • Streamline portability process • Allow new cross-jurisdictional consortia to administer vouchers • Improve Section 3 education and oversight • Improve and simplify Consolidated Plan process • PHA accountability and transparency: salaries, red flags

20. Opportunities Sane person finds the bright side • GSE reform • Some common sense reforms generate savings and could be implemented • Administration and many in Congress are committed to balanced housing policy

21. Balanced Housing Policy • As more of us become renters • Balanced as to favoring one form of tenure over another • Balanced as to resources devoted to programs

22. Connect with NLIHC • We Facebook, we Tweet, we blog! www.nlihc.org • Weekly newsletter, Memo to Members • Loads of housing data, national and local