Good morning. I am Jonathan Fanton, President of the MacArthur Foundation. Thank you for joining us today. We gather to talk about a critical issue: the preservation of affordable rental housing.

I will begin and then ask our guests, Secretary of Housing and Urban Development Shaun Donovan, Senator Mel Martinez of Florida, former HUD Secretary under President Bush, and Mayor John Hickenlooper of Denver, to make a few comments. After that, all of us, and Sister Lillian Murphy, CEO of national affordable housing organization Mercy Housing, will respond to your questions.

Almost all of us — young people starting out, seniors, single parents, and families of modest — rent at some time in our lives, through choice or need. Affordable rental housing is proving to be critical in times of profound economic change, such as we are experiencing right now. Rental housing also makes our labor force more mobile, our economy more flexible and responsive to opportunity.

For many years, home ownership in the U.S. has been emphasized — even over-emphasized — and as a country we have lost sight of the value of rental housing in a balanced national housing policy. Over the last ten years, 2 million affordable rental homes were lost: sold, demolished, or priced out of reach, off set only partially by one million new units of affordable housing.

MacArthur began to focus on this problem earlier this decade. In 2003, we launched “Window of Opportunity,” a $150 million initiative to help 25 leading non-profit developers and owners, in 38 states, step up the pace of rental housing preservation, demonstrate that it is a smart, cost-effective public policy, and make it possible to preserve one million homes in a decade. Already, the developers have shown that preserving an affordable rental home costs on average half as much as building new.

The end of the housing bubble, foreclosures and economic decline underscore the importance of affordable rental housing. We now have an opportunity to reset the policy agenda, restore rental housing to its proper place, and to reshape the policy environment so that it both encourages rental housing preservation and makes it easier to do. So our announcement today comes at a critical time. As part of Window of Opportunity, MacArthur is investing $32.5 million in 12 states, cities, and counties that are innovators in preserving affordable rental housing.

Why did we choose this route? State and local government has been at the forefront of new housing policy in recent years. Until today, in the midst of a crisis, the federal government has made housing a lower priority – spending on subsidized housing declined 80 percent over the last 30 years; HUD’s budget rose one half of one percent between 2001 and 2006 as other discretionary domestic spending increased 31 percent. We hope the current administration will set a new course, and know Shaun Donovan will use resources wisely, starting with the funds for HUD in the American Reinvestment and Recovery Act.

In states, cities, and counties, we see fresh approaches being tried – partnerships with non-profits, developers, and philanthropy that are yielding results. With $5 million from MacArthur, New York City set up a $200-million acquisition fund. In Cook County, the “Preservation Compact” in working to preserve 75,000 homes by 2020; MacArthur contributed more than $15 million.

We thought a groundswell of such efforts across the country would raise the visibility of preservation and change the policy landscape in a profound and lasting way. Our open competition drew 80 applications from across the U.S. A panel of experts selected 12; seven states, two state/city partnerships, one county initiative, and two cities.

The plans will assist military families in Maryland, seniors in rural Iowa and Vermont, low-wage workers in Florida and Oregon, formerly homeless in Los Angeles. They will promote energy efficiency in Pennsylvania, save distressed buildings in Minnesota, improve management of rental stock in Washington State, and ensure affordable rental homes in gentrifying areas of Denver.

Our funds will help all levels of government co-ordinate their efforts and target places most in need of intervention, track the state of rental housing and prompt action before buildings become run-down, and provide access to other sources of funding. Our $32.5 million dollar investment will leverage nearly $150 million in other funds. It will provide powerful examples that other states and localities can emulate and national leaders like Secretary Donovan can use to create a more purposeful plan for the nation’s supply of affordable rental housing.

Let me now turn it over to Secretary Donovan. Before he assumed this new post, MacArthur was pleased to support his affordable housing preservation efforts in New York, including investments in the City’s data and information systems about the stock of assisted housing. He will be followed by Senator Mel Martinez, former HUD Secretary who now sits on the Senate Banking, Housing, and Urban Affairs Committee and is a leader in affordable housing. Then we will hear from Mayor John Hickenlooper from Denver. His careful attention to the changing dynamics of his city led to the insight that preservation of affordable homes was an essential part of investment in new transit lines — to make sure that working families will be able to get to their jobs.

Housing, Preserving Affordable Rental Housing, Program-Related Investments, Housing, Policy, United States

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Preserving Affordable Rental Housing

MacArthur is investing $150 million to demonstrate that preserving and improving affordable rental housing is a smart and cost-effective strategy. At the center of this effort is a $32.5 million investment in 12 states, cities ...

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