Opening Remarks by Jonathan Fanton at “Partners in Innovation: A Dialogue on Federal, State, and Local Rental Preservation Solutions”
March 17, 2009 | Speech | Housing, Preserving Affordable Rental Housing

Thank you, Conrad, and thanks to the excellent staff at the National Housing Conference for your superb organization of this dialogue.

It is good to be among friends with whom we have worked for many years. I am pleased to see familiar faces like Michael Bodaken from the National Housing Trust and Bill Kelly from Stewards for Affordable Housing for the Future. I see proven developers like Amy Anthony from Preservation of Affordable Housing in Boston and Tom Bledsoe from the Housing Partnership Network — so many exceptionally gifted and dedicated people whose work I have come to admire during my time at MacArthur.

It is also encouraging that there are so many new faces in this room demonstrating the growing appreciation for the indispensable role of affordable housing for our communities and their people.

Today we look forward to a challenging and substantive dialogue. It will reinforce the importance of rental housing to a balanced national housing policy, showcase promising policies and practices, and accelerate the pace of affordable rental housing preservation across the country. And we hope to build a community that will confront the hard problems, share gains and setbacks, and forge the bonds of a powerful movement for change.

Not long ago, we would have thought it unlikely that the attention of the nation would be riveted on housing policy. For three decades, we lamented a decline of attention and resources at the federal level, especially affordable rental housing. Only a few innovations, like HOPE VI, and champions, like Barney Frank, kept programs alive. We launch our program today in the spirit of hope that it can be the source of a new framework for a balanced housing policy that delivers affordable, decent housing to millions of Americans in need.

The massive mortgage and foreclosure crisis is not what we would have wished for; but every crisis is also an opportunity. The crisis has riveted our country’s attention on housing. As we work our way out, as policy-makers and the private sector are receptive to rethinking what a sensible national housing strategy would look like, we have an opening. The Federal government, after allowing spending on subsidized housing to decline 8% over the last 30 years, is ready to do more. We have a gifted new Secretary of Housing and Urban Development, Shaun Donovan — one of us — eager to lead and listen to our counsel. Now is the time to fix housing firmly at the center of the domestic policy agenda, where it deserves to be.

And we must be clear about what we advocate. This nation has the capacity, and the responsibility, to offer quality housing to all its citizens. Our instincts, and a growing body of research, tell us that stable, affordable housing is the platform for strong families, successful children, healthier individuals, more vibrant communities. The allure of home ownership has dimmed and rental opportunities seem both necessary and honorable.

You know why. One third of Americans rent. Almost all of us have, at one time or another. Rentals are vital to young people starting out, those moving in mid-career, seniors downsizing, those who do not have the resources to own. Affordable rental units make it possible for people to move in pursuit of new opportunities, fuelling economic innovation and flexibility. In providing the rental housing our society needs, there is a role for government at all levels, for private developers, and for non-profits and philanthropy.

These are the convictions that first persuaded MacArthur to engage with affordable rental housing. As we studied the problem, we saw a dramatic loss of 2 million units. But we also understood that this loss could be slowed or reversed by the right policies.

That led to our Window of Opportunity initiative, launched in 2003. We committed $150 million to help 25 nonprofit developers and owners in 38 states, and non-profit financial intermediaries, step up rental housing preservation and show that it is smart public policy. We had a strategy — that our partners would create models of preservation to be adopted across the country and by federal policymakers.

So, in November 2007, here at Union Station, I announced a competition to discover where interesting experiments and new policies were happening around the country at the state and local level. The response was extraordinary.

Our intuition, that something profound is going on, was confirmed. We received 80 applications from 40 states — strong, thoughtful proposals that represented a growing consensus: that investing in our existing stock of affordable housing is sound, cost-effective public policy. Late last month, we announced the 12 states, cities, and counties that would share $32.5 million in grants and low-cost loans and preserve as many as 70,000 affordable rental homes.

Their plans will assist military families in Maryland, seniors in rural Iowa and Vermont, low-wage workers in Florida and Oregon, people who have been 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 that rentals are available in gentrifying areas of Denver. Ohio will take Chicago’s comprehensive Preservation Compact to a new scale and across rural and urban markets. And, Massachusetts will build on its already considerable investment in affordable rental housing.

The governments will take immediate practical action — locating the areas most in need of intervention, acting before buildings are run-down, improving access to funding. They will look to the longer term, encouraging steady and reliable owners, streamlining the sale and transfer of properties at risk to the right buyers, supporting residents who choose to stay or need help to leave, and collecting reliable data. And they will work toward larger reforms — in regulation, financing, and incentives.

We expect our $32.5 million dollar investment to leverage at least $150 million more in public and private funds. But more, we expect to make a cumulative case for preservation and provide a viable framework for future action. Moreover, we expect to transform the policy landscape in ways that both encourage affordable rental housing preservation and make it easier to do—all with the goal of preserving one million affordable rental homes in a decade.

Justice Louis Brandeis, writing in the Progressive era, called the states the “laboratories of democracy.” It is the genius of the American political system that states and cities can be sources of innovations that percolate up to the federal level and drive positive change. And we know that real progress often comes in our history at times of great challenge.

The pendulum has swung wide over the arc of American history—Washington dominant in the Great Society to the broad decentralization in Nixon’s New Federalism. This moment is different. The depth of the housing crisis requires all levels of government to step up, take responsibility, and get engaged. Our new President wants a partnership of ideas and action, a partnership with leaders in cities, counties, states and regions all across our country.

He said, in his inaugural address, that “it is not about whether government is large or small. It is about whether it works.” To make sure that it works, he has attracted top talent, eager to lead and to listen to wise counsel from those of you here in the room. The new HUD secretary, Shaun Donovan, has reiterated the President’s commitment saying he will “make HUD a model of evidence-driven government. [by setting goals] and metrics for each of our priorities, so that we can clearly and openly show what we have done well and where we can do better.” His outstanding record as head of the largest municipal housing department in the country gives us strong grounds for optimism. Tom Vilsack, former governor of Iowa and now Secretary of Agriculture, has a keen sense of why housing matters to rural communities and their economies. Which are often overshadowed by the housing needs in urban areas. As governor, he created a State Housing Trust Fund and led a bold effort to ensure adequate housing for people with disabilities. We will be privileged to hear from them both later.

The window of opportunity is open. It is open to you — state and local leaders, to be constructive, strategic, and reliable partners to owners, investors, tenants, and advocates working to preserve affordable rental homes, and to spend federal resources wisely. The window is open to you — policymakers at the federal level and national housing policy advocates — to find ways to support state and local innovation and accelerate the pace of preservation across the country.

Our ambition is greater than nurturing isolated examples of creative policy and practice. We need to build a consensus framework for national housing policy that reflects the assumptions and principles that housing matters deeply for families, communities, education, health, and more. We need to reassert the role affordable rental housing plays in a balanced, fair and forward-looking policy, and press the case for preservation of the assets that we as a nation have already invested in. And, we need to use our time together today to start a conversation that will continue as we confront the challenging years ahead.

One of my favorite presidents, Harry Truman, said: “A decent standard of housing for all is one of the irreducible obligations of modern civilization. The people of the United States, so far ahead in wealth and productive capacity, deserve to be the best housed people in the world.”

The time has come to fulfill that commitment. You know how much housing matters to our nation, its people, and our future. Your leadership, creativity, and perseverance are laying the foundations that will help fulfill America’s promise. Your work has never been as powerful, persuasive, or had more potential for success.

We are honored to be your partner in this important endeavor. Thank you.


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