Congress pushes to deregulate Public Housing Authorities across the nation

Congress pushes to deregulate Public Housing Authorities across the nation

By Lynda Carson -- May 30, 2012

Oakland -- With corruption running rampant on Wall Street, in the nation's lending institutions and the housing industry, millions of homeowners are facing foreclosure as a direct result. Matters are only getting worse as members of Congress and the Department Of Housing and Urban Development (HUD) are pushing to deregulate the nations more than 3,000 Public Housing Authorities (PHAs), and are insisting that more PHAs should be able to convert to what are called Moving To Work (MTW), demonstration housing authorities.

Authorized by Congress in 1996, the Moving To Work (MTW) demonstration program was created for a limited number of PHAs to try out new and different ways to save money, and find cheaper methods to deliver housing services. However, MTWs have morphed into agencies that are becoming notorious for abusing the funding from Congress. Funding that was meant to assist the poor.

Meanwhile, HUD is under fire by an April 19, 2012, report that was issued on May 21, by the Government Accounting Office (GAO), that ridicules any assertions by HUD that an MTW's activities can be evaluated properly.

The GAO is an investigative arm of Congress with the power to examine matters related to the receipt and use of funding by Congress, and the GAO believes that MTWs are not regulated enough to properly evaluate how they are operating.

As was reported by the National Low-Income Housing Coalition (NLIHC), during a March 29 oversight hearing of THUD and DOT programs in Washington D.C., HUD Inspector General David Montoya (IG) publicly criticized the Public Housing Authority of Philadelphia, as an example of the corruption of MTWs.

Montoya (IG) stated that the PHA in Philadelphia is an MTW demonstration program that was legally allowed to use $1.1 million of it's funding to fight against the oversight of the IG's office, and was allowed to use money to hire outside legal counsel to shadow "IG staff" that were auditing the housing authority, when it could have used the money on housing instead.

Since it was legal for that MTW to operate in such a way, apparently all other MTWs are allowed to abuse funds that were meant to be used for housing needs, to fight against audits by the HUD Inspector General's office.

At the same hearing, Montoya (IG) also stated that removing the MTW status from the PHA in Philadelphia would be a first good step to resolve the problems the IG is aware of at that housing authority since 2004, according to a March 30, release by the NLIHC.

According to the GAO report, the information available from HUD about MTWs varies, and the GAO report further revealed that HUD has declined to specify in it's rules and regulations that the performance information from an MTW must be quantifiable and outcome oriented. The lack of rules and regulations has corrupted and hampered efforts to determine if MTWs are functioning properly, and places hundreds of millions of dollars in federal funding at risk of misuse, and abuse.

HUD has not established a process to assess compliance with statutory requirements for MTWs, and the report further states that HUD lacks the assurance needed to determine that an MTW is complying with the statute that governs how an MTW is supposed to operate.

Additionally, "HUD has not identified the performance data that would be needed to assess the results of similar MTW activities or the program as a whole, and has not established performance indicators for the program," according to the GAO.

The MTW program is wide open to abuse, and according to the recent GAO report, "HUD has not done an annual assessment of program risks despite its own requirement to do so and has not developed risk-based monitoring procedures."

Additionally, the GAO report reveals that HUD cannot verify the accuracy of information being self-reported by MTWs to HUD, and the GAO reports that HUD does not have any policies or procedures active that are needed to verify what is actually going on in an MTW housing authority.

Despite the corruption of the existing MTW demonstration programs, members of Congress and HUD, want to allow for the creation of more MTWs across the nation in the latest housing reform bill working it's way through the system.

As is, 75% of all Section 8 housing assistance vouchers are required to go to poor people who's income is equal to or less than 30% of the area median income, and under an MTW demonstration program those rules may not apply any longer.

The current 35 existing MTW demonstration housing authorities are essentially free of the normal rules and regulations that most housing authorities have to abide by, and MTWs are allowed to ignore income targeting regulations meant to serve the poor, that are required in over 3,000 other non-MTW housing authorities.

Low-income tenants and housing advocates across the nation continue to speak out against the MTW program. MTWs can impose time limits and work requirements that are designed to force the poor out of the nation's subsidized housing programs, can set rents without regard to household incomes, and can merge the funding from the public housing program with the Section 8 voucher program, turning it all into one big huge slush fund.

According to the NLIHC, members of Congress are currently working on a huge housing reform bill called the Affordable Housing and Self-Sufficiency Act (AHSSIA), formerly called SEVRA (the Section 8 Voucher Reform Act) and SESA (the Section 8 Savings Act). AHSSIA has been stalled over efforts to expand the MTW demonstration program. The latest details of the bill released on April 13, has broad support, and details in the bill reveal that it is designed to have a significant negative impact upon the poor, elderly and disabled. It is another example of class warfare against the poor.

Despite the corruption of the existing MTW demonstration programs, members of Congress and HUD, want to allow for the creation of more MTWs across the nation in the latest housing reform bill working it's way through the system.

Efforts to move the bill forward continue, and even though the NLIHC has opposed the proliferation of MTWs in the past, it may be open to making a limited deal with law-makers, in regards to more MTWs.

HUD is not fully embracing the GAO's eight recommendations on how to operate the MTW program, and according to the recent GAO report, HUD has disagreed with the GAO's major recommendation to create overall performance indicators for all of it's MTWs. Despite the GAO's belief that performance indicators are critical to demonstrating program results in the MTWs, HUD continues to resist changes to it's policies.

In addition to allowing for the expansion of MTWs, Congress may soon pass legislation that raises the rent on the poorest of the poor, allows for a number of PHAs to test time limits, rent reform and work requirements for poor people in the nations federal housing programs.

Lynda Carson may be reached at tenantsrule [at] yahoo.com