SECRETARY CUOMO TESTIFIES ON HUD APPROPRIATIONS

On March 18, HUD Secretary Andrew Cuomo appeared before the House Appropriations Subcommittee on VA, HUD and Independent Agencies, chaired by Representative Jerry Lewis (R-CA), on HUD's reform efforts and budget request for FY98 and plans for the future.

In his testimony, which lasted over three days, Cuomo focused primarily on "averting the Section 8 renewal crisis", however he did reference President Clinton's request for "stable funding" for CDBG at $4.6 billion and $823 million for homeless programs. He introduced his budget proposal by noting that, "HUD's proposed budget for FY98 recognizes the need to meet both our fiscal responsibilities and social needs as we begin to face the challenges ahead." The challenges he cited include: 1) averting the Section 8 crisis; 2) expanding housing opportunities for all Americans; 3) making welfare reform work; and, 4) restoring the public's trust in the Department.

The members of the committee peppered Secretary Cuomo with questions over the three days including inquiries regarding the public housing and CDBG set-asides. Several members, including Chairman Lewis, were particularly interested in whether or not HUD was authorized to undertake the programs designated as set-asides in the CDBG program and the justification for said programs. The over arching theme of Mr. Cuomo's testimony was "doing more with less." With a shrinking budget for the Department, outside of the money slated for the Section 8 crisis, and a projected 28% reduction in staff for the Department over the next few years, HUD will have to find ways to "do more with less."

With Congress recessing from March 24 until April 7 for Easter/Passover, mark-up of the VA- HUD Appropriations bill is not expected until later in April at the earliest. The Senate Appropriation Subcommittees have begun work on the FY98 budget, however the VA, HUD,

Independent Agencies Subcommittee has not yet scheduled any hearings on HUD.

LAZIO CONCLUDES HEARING SCHEDULE ON PUBLIC HOUSING REFORM LEGISLATION - TITLE IV/HOME RULE AN ISSUE FOR DEBATE

On March 11, Representative Rick Lazio (R-NY), Chairman of the House Banking Subcommittee on Housing and Community Opportunities held the last in a series of three hearings on H.R. 2, the "Housing Opportunity and Responsibility Act of 1997", which he introduced on January 7.

Mayor Steven Goldsmith from Indianapolis, IN testified that, "Indianapolis has struggled to manage its public housing stock for more than 20 years," yet has not been able to solve the problems of their public housing authority. His conclusion was that, "public housing is flawed as a concept and a program." Mayor Goldsmith recommended the use of "competition to improve public housing." He also commended Chairman Lazio for the "Home Rule" option/Title IV contained in H.R. 2, stating that "this provision provides local governments with the opportunity to respond to the challenges of public housing, welfare reform and expiring HUD subsidies."

Representative Luis Gutierrez (D-IL) responded to Mr. Goldsmith's testimony in favor of Title IV saying, "Be careful Mr. Mayor for you may get what you want", warning that Title IV may only be a loosely masked attempt by the federal government to devolve itself from the responsibility of housing low income persons.

Title IV allows local governments to apply to HUD to receive all of the public housing and tenant-based assistance funds that come into a community. It allows the local jurisdiction to use public housing and assisted housing funds in highly flexible ways, subject only to a handful of requirements, the submission of a local housing plan and a performance-based contract between the jurisdiction and HUD covering no less than one year and no more than five. It does not mention whether or not the locality will be required to obtain the consent of the public housing authority for such a transition, nor does it address the issue of any-going support of the existing public housing stock. Block granting the public housing funds to the community, coupled with its present receipt of CDBG and HOME funds, results in essentially a single housing and community development block grant to the local government.

NCDA is in the process of preparing an organizational position on Title IV of H.R. 2, therefore your feedback on the issue is greatly appreciated.

HUD Inspector Susan Gaffney also testified on H.R. 2, providing "glowing" comments on Secretary Cuomo's management plan for addressing HUD's most significant and high-risk areas. Gaffney stated that "this is the first time she has seen a Secretary take such initiative to address mismanagement issues." The IG also praised the Department for its more aggressive stance on troubled housing authorities and the increased power to do so contained in Title V of H.R. 2.

With the conclusion of the hearings on public housing reform Representative Lazio is prepared to undertake mark-up. Chairman Lazio's original intention was to begin mark-up of the bill this week, however it has now been postponed until the week of April 7, at the earliest. Senator Connie Mack (R-FL), Chairman of the Senate Banking Subcommittee on Housing Opportunity and Community Development, introduced his version of the public housing reform bill, S. 462 on Tuesday of this week and will begin hearings some time after the Easter/Passover Recess. S. 462 very closely resembles the Senate public housing measure, S. 1260 which became bogged down in the 104th Congress.

This week, Senator Mack also introduced a multifamily portfolio reengineering (Mark-to- Market) bill very similar to last years bill, S. 2042, introduced late in the session. Representative Lazio has indicated that he too intends to introduce a multifamily portfolio reengineering (Mark-to-Market) bill in the coming months, but it unclear as to the nature of the measure. During his testimony before the House Banking Subcommittee on Housing and Community Opportunities earlier this month, Secretary Andrew Cuomo indicated that HUD will introduce public housing and Mark-to-Market legislation soon as well.

NCDA AND NATIONAL GROUPS HOST CONGRESSIONAL BRIEFING ON CDBG AND HOME

On March 20, NCDA and a group of national organizations representing local and state governments and non-profits hosted a briefing, sponsored by Representatives Rick Lazio (R- NY) and Joseph Kennedy (D-MA) to highlight the importance of the Community Development Block Grant (CDBG) and Home Investment Partnerships (HOME) programs. The event was scheduled immediately prior to Community Development Week, to kick-off the week long focus on the outstanding accomplishments of the CDBG program.

The event was attended by Representatives Sheila Jackson-Lee (D-TX) and James Maloney (D-CT) and nearly 70 congressional staff persons and other invited guests. The speakers included: Randy Patterson, Deputy Executive Director, Housing and Redevelopment Authority of Lancaster County, PA; Catherine Gregory, Deputy Director, Delaware State Housing Authority, Dover, DE; Martin Dunn, Executive Director, East New York Urban Youth Corps, New York, NY; Greg Cantori, Executive Director, Lightstreet Housing Corporation, Baltimore, MD; and, Karen Thoreson, Tucson Housing and Redevelopment Authority, Tucson, AZ moderated the session.

A briefing packet was prepared for the event, a portion of which (summaries on the CDBG and HOME programs), is included in this mailing. Determined to be a successful method in reaching a large number of congressional staff, it is likely that this event will be held on an annual or bi-annual basis. The sponsoring organizations in addition to NCDA, included the: National Association of Counties, National League of Cities, U.S. Conference of Mayors, Association of Local Housing Finance Agencies, Coalition for Low Income Community Development, Council of State Community Development Agencies, Housing Assistance Council, Local Initiatives Support Corporation, National Association of Housing and Redevelopment Officials, National Council of State Housing Agencies, National Rural Housing Coalition, Seedco and The Enterprise Foundation.

HUD PRODUCES GUIDE TO USING CDBG FUNDS FOR ECONOMIC DEVELOPMENT

During a recent meeting of the National Association for County Community and Economic Development (NACCED), Deirdre Maguire-Zinni and Barbara Neal from HUD-CPD, Office of Entitlement Communities conducted a workshop on the "Use of Community Development Block Grants (CDBG) Funds for Economic Development." The workshop contents covered microenterprises, recent changes to CDBG economic development regulations, public benefit guidelines, including a review of a case study, and national objective changes and implications.

HUD has encouraged communities to use CDBG funds for economic development over the past several years and this booklet and training is designed to assist communities in understanding how to make it work for them locally. The workshop guidebook is enclosed with this mailing. For copies of the Appendices and "Step by Step Guide to Project Underwriting" contact NCDA, (202) 293-7587.

HUD RELEASES REPORT ON LEAD-BASED PAINT SAFETY

As noted in the NCDA Washington Report, 3/10/97 HUD recently issued a report to Congress entitled, "Moving Toward a Lead-Safe America". The report details the efforts of HUD and other federal agencies, in collaboration with local communities, to control lead- based paint hazards without reducing the affordability and availability of low-income housing. The report was prepared in response to section 1061(a) of the Residential Lead-based Paint Hazard Reduction Act, which is Title X of the 1992 Housing and Community Development Act. It discusses the implementation of Title X, the research mandated by Subtitle D, health and environmental studies on childhood lead poisoning and estimates of the federal assistance for lead-hazard evaluation and reduction activities available. The Office of Lead-Based Paint Abatement and Poisoning Prevention at HUD has shortened its name to the Office of Lead Hazard Control and has now made information available on the Internet at http://www.hud.gov/lea.leahome.html.

HUD HOLDS QUARTERLY MEETING OF THE GSE WORKING GROUP

On March 19th, HUD held it's first quarterly meeting of the GSE Working Group to discuss issues related to Fannie Mae and Freddie Mac's (GSE's) performance in meeting the goals set out in the GSE Act. The GSE Act defines the minimum performance standards that the GSE's must meet under the goals of Low and Moderate Income, Geographically Targeted, and Special Affordable categories.

"Low and Moderate Income" is defined as households with income less than or equal to area median income. "Geographically Targeted" is defined as dwelling units in metropolitan census tracts with: 1) median income less than or equal to 90% of area median income; or, 2) minority concentration of at least 30% with tract median income less than or equal to 120% of area median. In nonmetropolitan areas, counties are included if median family income does not exceed 95 % of the greater of state or national nonmetropolitan median income. "Special Affordable" is defined as households with income less than or equal to 60% of area median or less than or equal to 80% of area median and located in low-income areas.

According to the 1996 results reported by the GSE's in their congressionally required yearly statements, both of the GSE's met their goals with Fannie Mae performing better than Freddie Mac in every category:

Participants at the meeting also weighed in on discussions regarding the GSE's performance related to credit underwriting, especially issues affecting single family lending; the impact of seasoned loan and appraisal guidelines on single family lending; and the impact of GSE guidelines on multifamily lending.

If you have any related experience in dealing with the GSE's or have any questions, please contact Robin Thompson at NCDA, (202) 293-7587.

MULTI-BILLION DOLLAR INVESTMENT COMMITMENT ANNOUNCED

On March 13, Habitat for Humanity International, Local Initiatives Support Corporation (LISC), The Enterprise Foundation and the National Neighborworks Network held a press conference in Washington, DC to announce a multi-billion dollar investment commitment to low-income communities nationwide and challenged the nation to join them in their deepened commitment.

The four organizations have worked on the local level to help bring about significant transformations in communities most in need. The campaign has now reached a sufficient scale to constitute a proven track record of accomplishment--136,300 affordable homes and apartments and more than $8.9 billion in investment in the past four years.

The key to success, as announced at the press conference, has been the dynamic public/private partnership that has provided critical financial and technical resources to local nonprofits, enabling them to revitalize their communities. That partnership was described as including local, state and federal government leaders working to encourage local initiative and stimulation of private investment, leaders of the nation's Fortune 500 corporations, intermediaries such as the four listed above, religious institutions, labor unions and local leaders, all working together to recognize and invest in the potential of local communities.

NATIONAL COMMUNITY INVESTMENT INSTITUTE ANNOUNCED -- NCDA WILL ACT AS COSPONSOR

The Neighborhood Reinvestment Corporation's Community Investment Institute will take place on September 20-24, 1997 in Washington, DC. This Institute will offer a wider version of the training for community developers than the Neighborhood Reinvestment Training Institute typically offers, with the goal being to bring people together--colleagues in the community development field and others working on a spectrum of related issues such as CDBG, sustainability, urban design, community policing, welfare reform and many related topics.

Mark your calendars for this important training session! NCDA will keep you informed of session topics and locations as the date approaches.

PLANNING UNDERWAY FOR THE NATIONAL HOMEOWNERSHIP SUMMIT

Plans for the Second National Homeownership Summit are currently underway, with the anticipation being that this year's Summit will be even bigger than last year's. The Summit will be held on May 29-30 at the Omni Shoreham Hotel in Washington, DC and will include a series of workshops, panel discussions, round tables and training sessions.

Please plan on attending the summit, registration is free and open to all NCDA members. Also, enclosed is the most recent issue of KeyNotes which gives details on current Partnership events around the country.

TREASURY'S BANK ENTERPRISE AWARD (BEA) PROGRAM OPEN FOR APPLICATION AND SECOND ROUND OF CDFI'S AVAILABLE SOON

The U.S. Department of Treasury's Community Development Financial Institutions (CDFI) Fund is pleased to announce the beginning of a second funding round of the BEA program. A Notice of Funding Availability (NOFA) and the revised interim regulations for the program were published on March 7, 1997 in the Federal Register. The CDFI Fund intends to make available up to $16.25 million for Bank Enterprise Awards (BEA) in this round.

The BEA Program is intended to encourage banks and thrifts to invest in and support community development financial institutions (CDFIs) and to increase the lending and services provided in distressed communities by traditional financial institutions.

To obtain an application packet, please fax your name, title, bank institution, address, phone number and fax number to the CDFI Fund, fax: (202) 622-2599. The deadline for applications is April 25, 1997.

The Notice for Funding Availability (NOFA) for the CDFI Program and revised regulations are expected to be published soon in the Federal Register. The CDFI Program is the Fund's largest program, designed to provide financial assistance and technical assistance to a diverse group of community development financial institutions (CDFIs) at different stages of development. Applicants must be able to match funds from non-federal sources that are at least comparable in form and value to the financial assistance sought from the Fund. Applications will be rigorously evaluated on a competitive basis.

To reserve an application packet in advance or for more information fax your address and information to (202) 622-2599.

NATIONAL COMMUNITY DEVELOPMENT WEEK '97 KICKS-OFF- OVER 300 COMMUNITIES AND STATES PARTICIPATING

Monday, March 24 marks the beginning of National Community Development Week 1997! Over 300 localities and states have registered their participation in the effort and it is looks to be a very exciting celebration nationwide. If your community has yet to order posters or postcards a very few packets remain. Fax in your order form or contact Karen Means at NCDA for further information. Full coverage of the CD Week events throughout the country will be featured in the next issue of the NCDA Washington Report.

NOTICE: NCDA NOMINATIONS AND ELECTION COMMITTEE
In conformance with the By-Laws of the National Community Development Association (NCDA), this notice is to advise that Ms. Vicki Covey, immediate past president of the Association is to serve as Chairman of the Nominations and Election Committee.

As provided by the By-Laws, annual elections shall be held for the offices of Vice-President and Secretary/Treasurer. Nominating petitions, signed by at least ten (10) active members of the Association, may be submitted thirty (30) days prior to the first day of the regularly scheduled Annual Conference. NCDA's Annual Conference. NCDA's Annual Conference will be held from June 8-10, 1997.

Please submit any nominations to Ms. Vicki Covey, c/o NCDA, 522 21st Street, NW, Suite 120, Washington, DC 20006.

Nominations supported by ten (10) active member's signatures from a minimum of three regions may be submitted from the floor at the Annual Conference and no member shall be allowed to sign more than one petition for the same office. All members will notified fifteen (15) days prior to the Annual Conference of the nominations received and the slate of officers proposed by the Nominations and Election committee.

FEDERAL REGISTER NOTICE

Proposed Rule: Community Development Block Grant Program for States, Revisions to Program Income Requirements and Miscellaneous Amendments, Notice of Proposed Information Collection Requirements - FR 62 11283 -11295, 3/11/97 - This proposed rule contains changes to several sections of the regulations for the CDBG program for States. Comments are due by May 12, 1997.

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