House Hearing on HOME Program

The House Committee on Financial Services held a hearing, “Oversight of HUD’s HOME Program,” on June 3 in response to a series of articles in the Washington Post that criticized a number of HOME projects and questioned the Department of Housing and Urban Development’s (HUD) oversight of the program.

In his opening statement, Committee Chair Spencer Bachus (R-AL) said that the purpose of the hearing was not to eliminate the HOME program, but rather to investigate ways to improve HUD’s ability to manage the program. Mr. Bachus also said that the problems with the HOME program should not be attributed to the current Administration, and that he is confident that, based on conversations with HUD officials, there is a strong commitment within the agency to improve oversight of the program.

Mr. Bachus identified three steps necessary to move forward with improvements to the HOME program: “First, that the contracts require repayment for failed projects or misspent funds; second, that those who defraud the government are pursued vigorously; and third, that eligibility requirements for developers are substantially tightened.”

HUD Assistant Secretary of Community Planning and Development Mercedes Marquéz testified in strong support of the HOME program, and corrected several aspects of the Washington Post series. For example, while the Washington Post claims that 700 of the 5,000 HOME projects it examined were stalled, HUD’s own investigation found that half of those projects had been completed.

Ms. Marqu­éz also said the Washington Post stories did not account for the fact that many projects were delayed due to the recession, which affected the ability of developers to use HOME dollars to leverage other funds. She also said the pace of HOME project completion has exceeded that of private sector development.

State and local participating jurisdictions (PJs) bear much of the oversight responsibility for the use of HOME funds, explained Ms. Marquéz. She said one of the most effective ways HUD can strengthen oversight of the program is to engage in capacity building at the local level to help ensure communities have the tools and expertise they need to pursue those who misuse HOME funds.

HUD Assistant Inspector General for Audit James Heist testified that, while he has concerns about the controls, monitoring and information systems associated with the HOME program, HOME nonetheless is “an important program which provides affordable housing to low income Americans. Given the current economic and housing crisis in our county, the need for affordable housing may never have been greater than in these tumultuous times.”

Many Committee Members on both sides of the aisle emphasized the important role that the HOME program plays in meeting the housing needs of low income families in their congressional districts.

Questions directed at both witnesses were largely focused on how oversight of HOME dollars can be improved to ensure that low income households are better served and that taxpayer dollars are well spent. In response to questioning from Representative Judy Biggert (R-IL), Chair of the Subcommittee on Housing and Community Opportunity, about the transparency of the HOME program, Ms. Marqu­­éz said that there is extensive data on all HOME projects available to the public on HUD’s website, making HOME one of the most transparent federal programs.

Mr. Bachus’s statement is available at http://financialservices.house.gov/News/DocumentSingle.aspx?DocumentID=244623

Witness testimony and hearing webcast are available at http://financialservices.house.gov/Calendar/EventSingle.aspx?EventID=242647

HUD data on the HOME program can be found at http://www.hud.gov/offices/cpd/affordablehousing/reports/

The Washington Post series on the HOME program is available at http://www.washingtonpost.com/2010/07/08/AFxelh3G_page.html

NLIHC’s response to the Washington Post’s stories can be found at http://nlihc.wordpress.com/2011/05/23/the-real-scandal/