▶ 0:03:21The subcommittee on housing and insurance will come to order. Without objection, the chair is authorized to declare a recess of the committee at any time. This hearing is titled Home 2.0, Modern Solutions to the Housing Shortage. Without objection, all members will have five legislative days within which to submit extraneous materials to the chair for inclusion in the record. I would remind all members and witnesses we do have an open vote on the floor at this time.
▶ 0:03:47So the committee reserves the right to recess for purposes of that. Uh but uh we are convening this hearing today in a spirit of bipartisanship. I recognize myself for four minutes for an opening statement. First, I'd like to thank all of our witnesses uh for being with us today. I very much look forward to hearing your testimony on the Department of Housing and Urban Development's Home Investment Partnership Program.
▶ 0:04:11For those that are not familiar with it, the home program was created in 1990 with the passage of the Cranston Gonzalez National Affordable Housing Act. The home program provides block grant funding to states and municipalities for the purpose of building and rehabilitating affordable housing. In practice, home is often used as a gap financing tool for housing projects, often in conjunction with LITC, the lowincome housing tax credit.
▶ 0:04:39Since the early 1990s, the program has continued to be funded without many statutory changes and without a reauthorization. In other words, the home program is ripe for a remodeling itself, a fresh look from this committee. Our work in this subcommittee this year has been focused on one thing, and that's addressing rising housing costs in this country. The one way to curb rising housing costs is to increase housing supply.
▶ 0:05:04No amount of rental assistance, down payment assistance, or other demandside subsidies will get us out of our housing cost problem. We need to build more housing in this country, and that's the only solution that will move the needle. The underlying supply problem is what made me so interested in the home program to begin with. Home is a program within our jurisdiction that is specifically geared towards building housing supply.
▶ 0:05:29I figured it would make sense to take a closer look at home and figure out what works with the program, what doesn't work with the program, and what we could change. To that end, I'm proud to say that I've been working very closely with my colleague, Ranking Member Clever, to get to the bottom of those questions. In April, you might have seen it. The two of us released a video requesting comments from states, cities, nonprofits, and developers on the home program. We received over 140 letters from organizations across the country in response.
▶ 0:06:00In May, the two of us sat together in a room for six hours meeting with different requesters and asking them questions on how they would change the home program. Now, finally, we have a public hearing on this topic. In the comments we received from a diverse set of stakeholders, there were four themes that came up repeatedly as pain points that drive up housing costs in the home program. They are what I call the four horsemen of the housing apocalypse. The environmental review requirements. That's the first one.
▶ 0:06:28These delay a project start and often drive up its cost. Number two, the Build America Buy by America requirements that drive up the cost of critical construction materials. Number three, the Davis vacant requirements that from what I've heard are much more costly due to the associated reporting requirements than they are for the actual cost of paying the prevailing wages and section three requirements that make it more difficult to find contractors to do the job, particularly in rural areas with some of the workforce challenges I mentioned.
▶ 0:06:59We all agree that individually each one of these requirements have a noble purpose, but when you put them all together, it makes it harder to address the supply problem uh in a less costly way. The legislation attached to this hearing intends to address each of these four factors that drive up costs in the home program. Additionally, it seeks to provide a little more flexibility for jurisdictions to use funds to build more supply rather than for the permissible demand side uses of the program.
▶ 0:07:28I expect our conversation today uh members uh will and witnesses may raise things they'd like challenged within this draft. That's okay. In fact, it's more than okay. That's why we're here. As I close, I want to thank Ranking Member Clever for working in such good faith with me over the last several months. It's been a pleasure to develop a closer relationship with him through this process. With that, I'm excited to hear testimony from our witnesses on the home program and housing supply. And with that, I yield back.
▶ 0:07:56I now recognize the ranking member of the subcommittee, Mr. Clever, for vi for for five minutes for an opening statement. Thank you, Mr. Chairman. Uh let me thank you also for uh creating uh very wholesome atmosphere to work on some very serious pieces of legislation. and thank the witnesses and and some of the advocates uh who are concerned about the home program who've joined us here today. I'd like to begin by describing for the American public the process for the legislation being considered.
▶ 0:08:27Uh my colleague has already outlined some of it, but at the beginning of this congress, Chairman Flood and I sat down and discussed our priorities around housing and insurance. Increasing the supply of safe, decent, and affordable housing is a challenge across this nation. Tomorrow, I'll join the National Lowincome Housing Coalition to release the 2025 out of reach report. The report will highlight the urgent need for more housing supply.
▶ 0:08:56The high cost of housing is a function of limited supply. In Missouri, my home state, a minimum wage worker needs multiple jobs to afford a one-bedroom rental home at fair market rate. In April, the chairman and I put out a national request on how to improve HUD's home program. Home is HUD's largest program dedicated exclusively to supporting affordable housing. The program is often used with the low-income tax credits.
▶ 0:09:26Every $1 of home leverages nearly $5 in additional private investment and home has built more than$1.4 million affordable houses. It is also operating on an expired authorization and in need of After soliciting feedback, Chairman Flood and I invited organizations to discuss their needs, their ideas. We came to an agreement on key areas to be addressed and continue to work on that legislation.
▶ 0:09:56There are a massive number of rules placed on nonprofits, on thin margins, and on lowincome housing providers who are building safe, decent, and affordable housing. Many rules add little to the goals of the program are outright counterproductive. This includes rules that prevent low-income populations from participating in federal projects.
▶ 0:10:21Low-income housing programs have also been tasked with complying with uncoordinated rules across different programs and agencies that make the goals of providing safe, decent, and affordable housing more difficult. This is something that Ezra Klein and Derek Thompson wrote in their length in their book at length in their book abundance. And I advise everybody read that book. it'll make you happy or as it did in with me convicted me.
▶ 0:10:49Uh we saw a home rulemaking last year that addresses some of the issues of the program, but Congress is needed as well. All the witnesses today report that home that the home program can be improved and that the program is critical to housing supply and I agree. Anyone who knows housing agrees. The witnesses today are more than 100 organizations uh and what they have provided us in terms of invaluable feedback.
▶ 0:11:18Uh the the physical 26 appropriation subcommittee bill this week would not provide new homes for h for the home program and would cut or eliminate many of the home programs. This is wrong. I disagree with it. Mr. House had the white house presented. Uh it's just some we we disagree with strongly. No matter what we do on home, this hearing today is not occurring in a vacuum.
▶ 0:11:45I am committed to working with you on home uh and on the many issues facing American families. I look forward to my continuing uh working with work with uh the chairman uh and I look forward to being with him when we cross the line on this extremely important piece of Thank you uh Representative Cleverber.
▶ 0:12:05I now uh welcome the testimony of Miss Alan Allison George, the director of the Colorado Division of Housing, Department of Local Affairs, here on behalf of the Council of State Community Development Agencies as board president. We also welcome Mr. Eric Oberdorfer, director of the policy and legislative affairs at the National Association of Housing and Redevelopment Officials. Mrs.
▶ 0:12:29Ellen Woodward Pototts, the executive director of Habitat for Humanity of Tuscaloosa, here on behalf of Habitat for Humanity International, and Miss Tiffany Bohe, president of Mercy Housing in California. We thank each of you for taking the time to be here. Each of you will be recognized for five minutes to give an oral presentation of your testimony. Without objection, your written statements will be made part of our official record.
▶ 0:12:56Miss George, you are now recognized for five minutes for your oral remarks. Thank you. Good afternoon, Chair Flood, Ranking Member Clever, and members of the subcommittee. Thank you for this opportunity to testify today. I'm Allison George. I am the board president of the CO council of state community development agencies, CASDA. We represent states that administer vital programs doing housing, community development, homelessness programming, and disaster recovery work.
▶ 0:13:26I am from the great state of Colorado, the and the director of the division of housing at the Colorado Department of Local Affairs. I'm here today on behalf of state housing leaders across the country who administer the home investment partnership program and to share how these funds are making a difference in An example from Representative Person's district, Harvest Hill in Broomfield.
▶ 0:13:52Broomfield is a suburban area between Denver and Boulder, housing over 74,000 residents. Through a $2.6 million home award, we're helping build 152 affordable homes for families earning between 30 and 70% of the area median income. This income range is 42,000 to 94,000 for a fourperson household in Broomfield.
▶ 0:14:17I particularly want to highlight the 8 30% AMI units at Harvest Hill because these units at a deeply affordable rate are not possible without essential gap funding. In partnership with Broomfield Fish, a local nonprofit, residents will have access to food security programs and long-term stability services. And that's just one piece of the broader ecosystem.
▶ 0:14:46Home is often the first funding source in and the last piece that keeps a project together. Now, I'll share with the committee what home makes possible in Colorado. In fiscal year 25, we received over $16 million through home, 5 million to my department, and 11 million directly to our local governments.
▶ 0:15:11Public data from HUD shows that since 1993, Colorado has assisted over 29,000 invested over 280 million of home funds in over 60 cities and towns, and contributed to over 500 project. That funding goes a long way in a tight housing market. Nationwide, the success of the home program is clear. The program is a great investment.
▶ 0:15:41HUD estimated that with 1 billion in fiscal year 24 funding, the home program would leverage about six billion in additional investments. Since 1992, home has generated 2 million jobs and over 140 billion in local economic activity.
▶ 0:16:00To strengthen the home program though, Kazda has outlined several key From CASDA's national network of state agencies, we fully support modernization and respectfully offer the following suggestions to improve homes efficiency and impact. First, ease administrative burdens where possible.
▶ 0:16:22We recognize the importance of but overlapping requirements like section 3, Davis, Bacon, BABA, and environmental reviews have become especially difficult for our small and rural communities to manage. We encourage consideration of ways to streamline or better align these requirements to keep projects moving.
▶ 0:16:43Second, support stronger administrative Many states, including Colorado, are doing a lot with very limited resources. We would welcome consideration of increasing the administrative cap, eliminating the commitment deadline, and revisiting the CHTO set aside to reflect today's operating realities. Third, preserve flexibility in how states use home.
▶ 0:17:10The ability to adapt the program to local conditions is one of home's greatest strengths. We hope an un any updates to program maintain the flexibility while allowing improvements that simplify implementation. So in closing, home is working in Colorado and across the country. We appreciate subcommittee's thoughtful efforts to modernize the program. At the same time, we are concerned about the House Appropriations proposal that plans to eliminate home funding.
▶ 0:17:41The one-time home ARP program is entirely separate and distinct from the annual home program. We urge this subcommittee to continue emphasizing the importance of the home program as funding negotiations continue. On behalf of CASDA and the Colorado Department of Local Affairs, thank you for your leadership and for keeping housing front and center. I'll be glad to answer any questions you have. Mr. Mr.
▶ 0:18:09Oberdorfer, you are now recognized for five minutes for your oral remarks. Thank you. Good afternoon, Chairman Flood, Ranking Member Cleaver, members of the subcommittee, and thank you for this opportunity to comment on the Home Investment Partnerships Program. My name is Eric Oberdorf, and I'm the director of policy and legislative affairs for the National Association of Housing and Redevelopment Officials, or NARO. NARO's members play a vital role in providing homes to more than 8 million people nationwide.
▶ 0:18:39NARO members include public housing agencies and community development organizations serving rural, suburban, and urban areas across the United States. NARO members use the home program to help expand the supply of housing and provide essential funding to support local housing needs. Housing professionals rely on home funds to make affordable housing projects financially viable, often using home dollars to fill critical financing gaps, including low-income housing tax credit deals.
▶ 0:19:09Home funding has become increasingly important to affordable housing creation, having produced and preserved 1.4 million homes since the program began. Further, since 1992, home investments have supported over two million jobs and generated approximately 135 to 140 billion in local income. By modernizing and streamlining the home program, we can help reduce project costs and stretch home dollars further to create more affordable housing.
▶ 0:19:39Although well-intentioned, certain requirements including Davis Bacon Build America by America or BABA and the environmental review process impact the effectiveness of the home program. Davis Bacon requires federally assisted construction projects to pay prevailing wages and benefits to laborers. And while NARO supports fair and adequate wages, the current threshold of 12 units that triggers Davis Bacon makes lower volume construction projects more difficult by driving up costs and adding significant administrative burden.
▶ 0:20:08This can put these smaller but important projects out of reach. As such, Naro recommends increasing the number of units that trigger the Davis Bacon threshold to 50 units. NARO also recommends increasing the construction contract threshold for Davis Bacon to adjusted annually for inflation so that home remains economically viable with other funding streams. Build America by America or BABA requires the use of domestically produced materials for projects that use home funds.
▶ 0:20:38And while NARO supports American manufacturing, BABA makes it more difficult to build and preserve affordable homes. Currently, demand for housing materials far outweighs the supply, the extra costs, increased timelines, and confusing requirements connected to BABA make it harder for contractors and private developers to take on federally funded projects. Exempting home and other housing and community development programs from BABA would ensure funding could be used quickly and efficiently to address our current housing supply crisis.
▶ 0:21:08Cumbersome environmental reviews can also make home dollars less effective. These reviews often cause delays leading to unnecessary costs. NARO recommends improving the environmental review process by shortening the time it takes to complete and ensuring that only one review is required per project no matter how many funding sources are involved. Beyond streamlining, we also see opportunities to make the home program itself more effective.
▶ 0:21:32Specifically, NARO recommends broadening the list of eligible activities to include rehabilitating public housing units and supporting projects that have previously received home funds. These changes would help communities better meet local housing needs by allowing home to be used for the rehabilitation of public housing units. The program would provide muchneeded support to units in distress. Using funding for projects previously assisted with home funds, grantees can restore projects that need modernization.
▶ 0:22:02Lastly, authorizing adequate funding amounts for the home program would ensure that funds match increasing costs and need. Providing home funding at levels that keep pace with inflation and rising operating and construction costs would ensure the program remains effective in our current economic climate. Proposals to eliminate funding for the program would be devastating and would significantly decrease our country's ability to construct affordable housing.
▶ 0:22:29The gap financing provided by home is critical to making affordable housing deals work. Naro thanks the chair and ranking member of the subcommittee for their efforts to improve the home investment partnerships program. Your commitment to expanding affordable housing for all Americans is greatly appreciated. Thank you and I look forward to your questions. Mrs. Pototts, you are now recognized for five minutes for your oral remarks.
▶ 0:22:55Chairman Flood, Ranking Member Clever, and members of the subcommittee, thank you for this opportunity to testify and share Habitat for Humanity's recommendations for deepening the impact of HUD's home investment partnerships program. My name is Ellen Woodward Pototts and I've served as executive director of Habitat for Humanity of Tuscaloosa, Alabama since 2013.
▶ 0:23:18Um, I'm here on behalf of Habitat Tuscaloosa and on behalf of Habitat for Humanity's US network of over 900 affiliates in all 50 states, DC and Puerto Rico. Our country is facing a record shortage of entry-level homes, which has driven up prices and pushed the dream of home ownership out of the reach of millions of families nationwide.
▶ 0:23:44Throughout the United States, Habitat affiliates are working directly with essential members of the workforce, teachers, home health aids, military personnel, and many others who earn at or below the 80th percentile of AMI and struggle to find homes that they can afford to purchase.
▶ 0:24:03As one of the few builders in the starter home market, Habitat is working diligently to create and preserve home ownership opportunities, but both financial and regulatory barriers make it difficult to construct affordable starter homes. Habitat makes it work by leveraging corporate partnerships, private donations, volunteer labor, lowcost public land, and other means. But public resources are essential pieces of the solution.
▶ 0:24:33The home program's crucial resources have helped create home ownership opportunities for thousands of households in rural, urban, and suburban communities nationwide. We have received home funds as a community housing development organization or a CHO from the city of Tuscaloosa, which supported the construction of more than 30 homes for home ownership during my tenure. These local families would not have been able to purchase a safe and affordable home otherwise.
▶ 0:25:03However, the scale of our nation's housing crisis requires us to modernize the program and make home as effective as possible. We are grateful to see the interest by members of this subcommittee to modernize the home program and are honored to share the highest priority recommendations from our written testimony. First of all, we believe homes should be consistently available for home ownership purposes. We are fortunate to have a great relationship with our participating jurisdiction.
▶ 0:25:33However, that is not the case throughout the country as shown by the steep declines over the last 10 years documented by the Congressional Research Service. We recommend creating a floor for PJs to make assistance available for home ownership activities.
▶ 0:25:49We also recommend the statute make it explicit that the preemptive purchase option may be used by community development corporations such as hab habitat affiliates which have the ability and capacity to afford to preserve the affordability of forale homes for low to moderate income families. This should not be limited to community land trusts or entities using a shared equity model. Third, we understand the need for environmental reviews.
▶ 0:26:17However, the expensive process frequently creates significant delays and complications. Habitat recommends op offering categorical exclusions for new constructions of homes up to 20 units, exempting home repair projects altogether, and allowing the reuse of ERS. We are pleased to see language in the draft legislation that would provide categorical exemptions for several types of projects. also is included in the draft legislation.
▶ 0:26:47We recommend easing Davis Bacon compliance burdens. Habitat believes in fair pay for workers, but the challenge lies in the profuse documentation, especially for our small contractors. We recommend increasing the exemption from 12 to 50 units. Lastly, as in the draft legislation, we recommend exempting the development of private homes from Build America by America requirements.
▶ 0:27:13In closing, I would be remiss if I didn't mention the importance of providing robust annual funding for the home program alongside these wonderful uh modernization efforts. The program plays a critical role in expanding housing supply and pathways to home ownership. with improvements, it will only become more impactful. I appreciate the opportunity to share my experience and Habitat's recommendations. I um am happy to answer any questions.
▶ 0:27:43Thank you so much. Miss Bohe, you are now recognized for five minutes for your oral remarks. Chairman Flood, Ranking Member Clever, and other distinguished members of the House Financial Services Subcommittee on Housing and Insurance. Thank you for the opportunity to testify before the subcommittee's hearing today. My name is Tiffany Bohi and I'm honored to address you on this important modernization effort.
▶ 0:28:10I will speak from my experience as president of Mercy Housing California, the largest regional affiliate of Mercy Housing and a frequent user of the home program. Mercy Housing is a national nonprofit multifamily housing developer, owner, and manager with a portfolio of 346 rental communities, including more than 25,000 affordable homes across 21 states serving 40,000 people with low incomes.
▶ 0:28:38We are committed to creating affordable homes and thriving communities. Our development efforts have leveraged the home program in highcost urban areas as well as suburban and rural areas to develop homes for families, veterans, seniors, and people exiting homelessness. Nationally, Mercy Housing has leveraged home dollars to produce 111 multifamily rental communities inclusive of almost 8,000 affordable homes in 10 states.
▶ 0:29:09Just last year, we leveraged a home award of $700,000 to recapapitalize Timber Creek Apartments in Omaha, Nebraska, renovating the homes of 180 working families and ensuring that the apartment homes remain affordable for the long term. In Savannah, Georgia, home dollars helped us redevelop a public housing site into 484 modern homes where hundreds of families and seniors can thrive.
▶ 0:29:38In California, over the next few years, we will leverage committed home dollars to create new dignified homes for seniors in the small town of Davis, as well as a service enriched housing for seniors in Oakland. The home program is one of the only federal sources dedicated to providing gap funding for shovelready affordable housing.
▶ 0:30:00While Mercy Housing's projects catalyze a great deal of private investment, including financing made possible by the housing credit, these federal home dollars still make up a critical piece of our funding stack. Home is often the gap funding that makes affordable housing deals feasible, helps us break ground, and lease up our homes in less time.
▶ 0:30:22We're encouraged by the expansion of the housing credit in the recent tax and spending bill and wish to emphasize that this expansion will be even more impactful for working families and other low-income people if programs such as home are strengthened, fully funded, and streamlined.
▶ 0:30:40Because home funding is rarely the only source of funding for an affordable housing development, we recommend the subcommittee consider sensible streamlining reforms that make home dollars work more seamlessly with other kinds of funding. Firstly, save time by aligning the environmental review process.
▶ 0:31:00The use of home dollars often triggers an environmental review process per NEPA that is duplicative with existing environmental review and adds time without achieving environmental goals. Secondly, reduce complexity by using one set of regulations focused on tenants. Finally, address building requirements that make home dollars hard to use.
▶ 0:31:23Accepting home awards often triggers Build America Buy by America rules as well as Davis Bacon regulations which adds cost and complexity to the construction process and drives up the cost of producing more affordable housing. In conclusion, it is our hope that advancing common sense reforms to the home program does not come at the expense of maintaining adequate funding for this transformational program.
▶ 0:31:48We respectfully urge the committee to work with your colleagues and stakeholders to support and adequately fund this critical program. We stand ready to work with your committee to find meaningful bipartisan solutions. The federal government must partner with our states and municipalities to address housing shortages and recognize the importance of high quality multifamily rental housing for people who are not high earners.
▶ 0:32:16Home again is the only federal block grant focused exclusively on providing housing for people with low and moderate incomes. It is absolutely essential that this resource be maintained. Thank you and I look forward to continuing the discussion. I now recognize myself for five minutes for questions.
▶ 0:32:37Every witness with us today is either someone who interacts directly with home funding or someone who represents an organization whose membership interacts directly with home funds. So, I'm going to direct the next three questions to each of our four witnesses. I'm short on time, so I'd appreciate it if you would be concise with your answers. The first question is, due to the environmental review requirements in the home program, uh, do these requirements increase the cost of housing construction?
▶ 0:33:07Give me a yes or no and then briefly explain why. Miss Thank you, Chair Flood. Uh, the quick answer is yes. Um, it's yes because of the uncertainty of the number of times at this moment that an environmental review might be required. So there are many different triggers and so limiting the environmental review to one per project um is critical. Mr. Overdorfer. Yes. Thank you for that question, Mr. Chairman.
▶ 0:33:36I would agree. Um it does increase both time and cost. Uh I think to Mrs. George's point, what's really important is making sure that there is just one environmental review process throughout. Uh otherwise it can lead to delays which then will lead to increased costs and challenges with finishing the Mrs. Woodward Pots. Yes. Um it increases the cost for new home ownership by several thousand dollar but then also with our home repair programs.
▶ 0:34:06For instance, we have a an elderly couple now who are without heating and air conditioning. We're trying to replace their HVAC unit, but we can't do that until we get an environmental review done just to replace an HVAC unit. And how hot is it right now in Alabama? I don't want to say anything ugly. All right, we'll say very warm for them. Uh, Miss Boh. Yes, Chairman, it does increase the cost and time to construct.
▶ 0:34:36As other folks have uh articulated, there's a duplicative uh nature to a number of these regulations currently in the statute. It adds cost and administrative burden. Okay, next round of questions back to Miss George. Do Davis Bacon requirements increase the cost of housing construction using home dollars? Again, yes or no. And a very brief why. Uh quick answer is yes.
▶ 0:35:00And the reasoning is I would like to focus on the rural areas of our state uh where we don't see the consistency and uh oftent times with states uh states have their own requirements for wages and so there's conflicting um requirements and then that also drives up the administrative burden in reviewing uh both state and federal requirements. Mr. Oberfer. Uh yes.
▶ 0:35:27Um Davis Bacon comes with a significant amount of administrative requirements that are attached to it. What can be especially difficult is in smaller rural communities, local contractors or developers may not be willing to meet Davis Bacon requirements for a variety of reasons, meaning that uh develop meaning that grantees using home funds need to go further a field to get contractors or developers, which then adds additional cost as well. Mrs. Woodward Pototts.
▶ 0:36:01Yes. And part of the problem is that uh even in a community our size, we have 220,000 people living in our county. Um we have trouble getting people to bid at all uh for electricians, uh plumbers, things like this. And it's even more difficult to find them if they have to comply with Davis Bacon. Most of these people are small businesses. It's maybe an electrician with one helper and a bookkeeper.
▶ 0:36:26And so trying to do all of the Davis Bacon requirements uh when you're a really small business uh is is very difficult. And we like to support our small businesses. Sure. Miss Boheit. Mr. Chairman. Yes. uh we certainly are stalwart supports of our uh friends in labor and are committed to paying prevailing wage in the trades in both highcost and rural areas.
▶ 0:36:51However, as a national organization, we found that the application of that particular statute has really different impacts in different states and is for us we've seen particularly challenging in these highcost areas where communities are already rent burdened. Thank you to each of you. I have more of those kinds of questions, but my time is limited. But let's just observe what we just saw. We have Democrat and Republican witnesses get asked the same questions with mostly the same answers.
▶ 0:37:20This is one of those unique issues in America where we are on the right side because everybody up here wants to see more affordable housing. I bet we could do this with the section three requirements. We could do the same thing uh with some of the other issues relating to Baba. But with that, my time is up. So, I'm going to recognize the ranking member for his opportunity to question you all for five minutes. Uh, thank you, Mr. Chairman.
▶ 0:37:46Um, I pastor Church uh, almost dead life and uh, we have a panel and and probably members who agree on on things uh, better than a church meeting. Um, and sometimes church church I shouldn't have brought that up.
▶ 0:38:09Church meetings can be uh can be difficult, but uh I am I am appreciative of all the energy that's been put into this um this this effort that that we're uh laying out. Um, and putting aside my disagreement with uh appropriators about the um amount of funding currently um, Miss Bohe, do do you think that uh providing new funding
▶ 0:38:40along with some creative things that we are able to get into legislation um, could ignite a program like uh, the those who created this program way back uh anticipated. Thank you, Congressman. Yes, absolutely.
▶ 0:39:02We believe the home program with the modernization uh proposals that have been proposed um will absolutely help to streamline and build affordable housing cost effectively and faster. Uh thank you.
▶ 0:39:17Uh and last uh Last night I had dinner with uh a labor leader, AFL CIO U leader uh here in DC and talked about the home program.
▶ 0:39:34Um, and I I've raised the question uh if the home uh if if uh Davis Bacon was created in 1931 um and we are now in 2025 and 2000 uh was the uh key number in uh 31. I actually think it was a little little higher than that that went back down.
▶ 0:40:02But um what number would would would I'm asking all all of you what number would you uh as the trigger number on Davis Bacon? Thank you, Congress. Considering all the way 1931 till today, thank you um for that question.
▶ 0:40:26Uh, one of the biggest challenges I see is with our rural communities and making sure that we have enough bids u to actually do the work that needs to be completed in our rural communities. And so what we are recommending CASDA is that the threshold be increased to 50 units to ensure that we're able to get those projects moving in our rural communities throughout Colorado. Units instead of dollars. Focus on units. Yes. Uh thank you for that question ranking member.
▶ 0:40:56For the home program, NAR would agree that 50 units is an appropriate trigger for Davis Baker requirements. Again, this will help especially smaller communities, but also smaller projects in larger cities and suburban areas be able to build more units more quickly, which will make those home dollars go Miss Ellen, I completely agree. Um 50 units is what we also recommend. We agree with my colleagues here.
▶ 0:41:29Congressman, we do agree 50 units is an appropriate threshold. It does work in both our rural areas as well as in a number of our urban areas. So, uh is there a difficulty a greater difficulty in getting workers in in rural areas even if we um were doing a a larger project? Um, I have a town in my district, Marshall, Missouri. Uh, 12,000 people and, uh, but they're having difficulty.
▶ 0:41:58Um, and I think they might even have difficulty with 50 units. Um, because in a lot of these small towns, they're not going they're going to build 10 um under. I I' I'd like to take a survey to find out how many 50 unit um projects we have in rural areas. any any of you see that as a as a an Thank you, Congressman.
▶ 0:42:28By increasing the threshold, that means that in rural areas where they might be focusing on a project that's less than 50 units, they would not be doing the administrative paperwork for Davis Bacon. That that is the idea of increasing that threshold. Thank you. The gentleoman from Texas, Miss Dea Cruz, is now recognized for five Thank you so much, Mr. Chairman.
▶ 0:42:56Thank you um to all of our witnesses for being here today. Um and I would like to um talk a little bit about this important topic that I know is so important to my community. I serve a largely rural community, a Hispanic community. in fact, one of the most Hispanic communities in the entire nation in deep South Texas.
▶ 0:43:21Many of my constituents are impacted by key HUD programs like home, and it makes me happy to serve as vice chair of this subcommittee as we work to enhance these programs, making them more impactful and sustainable. And I know my constituents feel the long-term benefits. I've represented South Texas here in Washington DC for two and a half years.
▶ 0:43:48I've learned that change here in Washington can come more slowly than what I'm used to as a small business woman. A good example of this is with the home program uh where we are discussing here today and what hasn't been reauthorized since 1992. It's just incredible when I say it out loud.
▶ 0:44:12It's as if the world hasn't changed in 30 years and we know it has changed quite a bit since then. I appreciate this subcommittee's continued focus on housing issues as many of our constituents continue to struggle to purchase a home or make the rent.
▶ 0:44:32It is it is in the strategic interest of our nation and our constituents back home for us to use the resources available to bring highquality units to the market as quickly and effectively as possible. The positive reforms to the home program included in the draft text noticed for this hearing will do just that. shorten timelines and increase effectiveness.
▶ 0:45:02Looking at this panel before us today, I see a great slate of witnesses comprised of policy experts and people with real boots on the ground. So, I would like to give each of you the opportunity to share with us one positive reform included in the Home Reform Act and for you to explain to our constituents watching today how that change will help enhance the supply of affordable housing.
▶ 0:45:33Let's start with Miss George. Thank you, Congresswoman. I love being because that doesn't give me a lot of time to think about that. Um there are a lot of modernization um aspects uh that we're looking at now that are important.
▶ 0:45:50Um I think I want to focus on the flexibility that the pro home program has and that is my um it's one of my many hopes as you're looking at this modernization that you keep because we have been able to pilot new ideas with home that have grown across our state because of the flexibility that it has. So, I want to stress maintaining that flexibility.
▶ 0:46:21Um, not necessarily a change because I think testimony thus far has already touched on several of those. So, I'll let others go from there. Thank you. Flexibility. Thank you. Thank you for that question. Um, Congresswoman, I think what is most important that the bill does is exempt home from certain requirements like build America by America, increases the threshold to Davis Bacon as well as streamlines environmental review processes.
▶ 0:46:50Home does a lot of things and the flexibility in home is critical to the program. But one thing that is incredibly important about home is it acts as gap financing often for low-income housing tax credit deals. when home is applied to make the low-income housing tax credit work, which we just saw a significant increase in the tax credit come from Congress, uh those home requirements then fall onto the low-inccome housing tax credit, making it more difficult to move Now, when you said uh exempt homes from certain requirements, which requirement
▶ 0:47:20were you specifically speaking of? Build America by America. Build America by America. Uh and then also just the change thresholds for Davis Bacon and the environmental review Thank you. Yes, ma'am. I would agree that the the best thing is to reduce the amount of burdensome paperwork and regulations uh associated with using this very critical funding. Yes. Our last witness.
▶ 0:47:53Thank you, Congresswoman. Yes, the streamlining of environmental regulations, the exemption provided for under NEPA, and certainly making it easier to build so we can deliver these homes faster. Thank you. I yield back. The gentleoman from Texas, Miss Garcia, is now recognized for five minutes. Thank you, Mr. Chairman. And I'm gonna try, frankly, to contain myself because I just cannot believe some of the words that I'm hearing.
▶ 0:48:22And I agree with the chairman. We all want more housing, especially affordable housing, but I don't think I want to see affordable housing being built in an old land landfield. I don't think I want affordable housing being built by young people that are getting meager wages or by subcontractors and contractors that aren't even meeting the minimum wage.
▶ 0:48:45I don't want to see housing built that frankly is is goods or lumber or nails that are coming from another country and not the good old USA that are going to fall apart after two years of people living in it. So, I just can't believe you all are basically wanting us to toss out all the kinds of protections that we need to make sure that we only not be able to have affordable housing, but good quality housing.
▶ 0:49:12I'll be honest with you, I've been around for a long time in local government, state government, and I have never seen a panel actually talk about tossing all the rules out because we want to build anywhere, anytime, any way we want because that's what I'm hearing from you all. I mean, haven't you all heard about how great it is to support American manufacturing and products and buy American? We've all been talking about that for years. But do you want an exemption from that?
▶ 0:49:44I mean, really, you all do? I mean, I'm disappointed in all of you, especially Habitat. I mean, Habitat is is Jimmy Carter's group. I mean, he was as American as he got. He's probably rolling in his grave poor dear right And so I ask you first, ma'am. Uh you say you want to protect small business from Davis Bacon, but yet you don't want to support small US businesses by buying American.
▶ 0:50:10Can you help me reconcile We support our local contractors, most of whom we we only hire electricians, plumbers, uh HVAC contractors, and uh brickmasons, people like that. All of these people are making above the prevailing wage for Davis Bacon.
▶ 0:50:29The rest of our u most of our labor is provided either by our construction crew who are all paid fairly with health insurance or it's provided by volunteer But you're asking us to do away with the byamerican act. You want an exemption.
▶ 0:50:46Our issue with it is that it's very difficult to determine when we're going to 84 Lumber in Tuscaloosa, Alabama, where did those nails come from, you know, where did the Have you tried just asking the seller? It's very It's very difficult for a local business in Tuscaloosa, Alabama. And I I'm just like I said, I'm completely baffled by this panel. I can walk into Home Depot and they will tell me what is Americanmade or not.
▶ 0:51:14I can walk I remember one time going to four stores just trying to find a button-down shirt that was made in America. It's hard but you have to just ask. I'm having trouble reconciling your positions and you sir you talk about you know the prices and you know Davis Bacon and and costs. Well, don't you realize that the tariffs alone are going to cost about 40% more in building a home?
▶ 0:51:41At least that's what the homebuilders told us in another hearing about four four or five weeks ago. And then with a lack of immigrant labor, it's going to raise it another 30%. Yes, I I appreciate what is it you would just build any any damn thing you want to, any damn place you want to. No, I I I appreciate the question and I want to reiterate that NARO supports Americanmade products and manufacturing. The problem is the industry just isn't set up for that yet. We've been working which industry, sir?
▶ 0:52:10uh the construction industry, manufacturing, all of the things that would need to meet the Build America by America requirements. It's incredibly difficult. We've been talking about that since I was a county commissioner about 15 lives Although the Build America by America requirements have just come into compliance a couple of months ago and so the system is just not set up at this for developers or for contractors. Do you really want to build on a landfield? Do you really want to build on a site that's floodprone?
▶ 0:52:38Do you really want to build in in a place that has contamination of oil or gas or some toxic waste because you don't want to go through an environmental? No, absolutely not, ma'am. And our recommendation is not to prohibit environmental reviews, but rather to make sure there's one environmental review per project as opposed to having to go I build a lot of things. I was a county commissioner. I remember one time one road that took me almost three years to build because not only did I have to face environmental once it started digging they found a gas pipe.
▶ 0:53:08So then we had to do that review and then we went further down the road and it they found an archeological site. They had to do that review those things. Gentleoman's time is expired. The gentleman from New York, Mr. Lawler is now recognized for five minutes. I want to thank Chairman Flood for having this hearing and prompting us to begin to really take a look at the programs at HUD. In many ways, the home program exemplifies the larger problems with many of our housing programs.
▶ 0:53:37Despite its status as HUD's second largest block grant program and seventh largest program overall, the home program has not been reauthorized since 1992. We have continued to pump money into this program while program outcomes have diminished under outdated regulatory frameworks, administrative burdens, and inconsistent project tracking. One of the most common refrains I hear in the 17th district of New York is concerns about the affordability of housing.
▶ 0:54:08This is a basic supply and demand issue. We are 7 and a half million units underbuilt nationwide. We need to build more housing. Period. With mortgage rates near the near their highest since the turn of the millennium, it is perhaps the most difficult time to purchase a home in our nation's history. However, so much of the crisis comes back to the fact that we are not building enough.
▶ 0:54:38The home program, like other programs at HUD and other federal policies, need targeted modernization for the housing needs of the 21st century. We need to be structuring these programs to enable federal, state, and local partners to work together to incentivize growing our Miss George, Mrs. Pototts, and Mr.
▶ 0:55:03how would you describe the cumulative regulatory burden of the home program on participating jurisdictions and Thank you for that question, Congressman. Um, time is money.
▶ 0:55:21Um I have actually worked as a developer doing affordable housing and um at the state and then represent of course the council of state community development uh the regulatory uh items that we've talked about. Um it is not the wholesale elimination of these rules but really trying to target where they have uh the most um need.
▶ 0:55:49And so like with Baba in particular um we are in full agreement we want things built and uh purchased that are made in America. Absolutely agree. Uh the challenge is is the uncertainty and coming from a developer perspective when you're uncertain that you're going to be able to get the financing or you will get in trouble for something that you meant to do correctly.
▶ 0:56:17um you might choose not to do that deal and that's a problem because we need more housing. We're here to talk about doing more housing more rapidly and so the proposals that we're considering today are what we believe from practitioners is ways that we can achieve something that's better for all of us. Mrs. pots.
▶ 0:56:43So after the April 27th, 2011 tornado in tor in Tuscaloosa destroyed a sixth of the city in about five minutes. Hundreds and hundreds of houses were destroyed. Habitat wanted to buy 33 lots on Wanita Drive in the heart of the tornado zone.
▶ 0:57:02And it took more than two years, nearly three years to complete the environmental reviews and build homes for home ownership for Tuscaloosans who had lost everything they owned and many of them had lost family members. That's the kind of regulatory burden that I would like to see eased. It's not that we want to do away with environmental reviews. A thousand%. Mr.
▶ 0:57:28Oberdorfer, what reforms would best support new single family construction through the home program, especially in areas with acute homeownership demand? Thank you for that question, Congressman. I think what makes the home program so critical and important is the flexibilities that are included within that. What that allows is for grantees to determine what makes sense on the ground for them.
▶ 0:57:55um for areas where single family home ownership or single family uh building makes sense, home would allow them to do that. I I think what's most critical about the home program is that flexibility that allows communities to do what makes sense for their local needs. Look, this is one of the biggest issues facing the country, the issue of affordability and access to housing. Uh and the sheer fact is we just don't have enough housing.
▶ 0:58:24There needs to be greater cooperation between the federal government, our state and local partners and developers to actually incentivize the construction of new housing or the affordability crisis will worsen. The gentleoman from Georgia, Miss Williams, is now recognized for 5 Thank you, Chairman Flood and Ranking Member Clever, for this hearing today. And thank you to all of our witnesses for being here to talk about such an important issue across the board for all Americans.
▶ 0:58:51Today, my Republican colleagues are holding this hearing because they want people back home to think that they'll boost the home program to address the affordable housing shortage. And that will be noble if only my Republican colleagues actual actions lined up with this premise. You know what's not noble? Republicans saying nothing while the president continues to push an anti-affordable housing agenda, including eliminating the home program in his FY26 budget proposal.
▶ 0:59:18Before we can talk about expanding the home program, we need to make sure there's a home program left to even expand. I've always worked with my colleagues on the other side of the aisle in the subcommittee, and now I'm calling on my Republican colleagues to do the same. Work with Democrats and hold the Trump administration accountable for what they're doing in the housing space to make it more unaffordable for Americans. In the span of just six months, we've seen the Trump administration fire 700 HUD staff.
▶ 0:59:47We saw Trump give his once bestie, now friendnemy, whatever you want to call him, Elon Musk, his Doge Passion Project, access to sensitive housing discrimination data. We've watched this administration slash and cancel fair housing funding grants. And we all know why this is happening. It's because housing investments are meant to help low-income families and individuals. It's meant for those who struggle to afford a roof over their head.
▶ 1:00:13And clearly, these are not the people that Donald Trump has shown us that he fights for because they're not billionaires and they're not lining his pockets. In fact, he doesn't fight for me or the constituents that I serve. In my district alone, we have the widest racial wealth gap in the country and housing prices that continue to skyrocket. And in the Atlanta area, Trump's plans to gut housing investments will only make home ownership harder a more harder reality for so many people already struggling.
▶ 1:00:44If Republicans want to say today that they truly care about housing supply, which I think that they actually do, I need them to understand exactly how important the home program is before they allow President Trump to totally gut that, too. Miss Bowie, home program funds can be used to finance a wide variety of affordable housing activities that generally fall into six categories.
▶ 1:01:08New construction of homeowner occupied housing, rehabilitation of owneroccupied housing, assistance to home buyers, new construction of rental housing, rehabilitation of rental housing, and tenant-based rental assistance. Are there investments the home program can make that are not eligible activities under under any other federal program? Thank you for the question, Congresswoman.
▶ 1:01:36Um, we do believe one of the greatest tools is uh streamlining, eliminating duplicative uh requirements. Absolutely. This program must absolutely be preserved. It is again the only source of federal block grant funding specifically targeted to low and moderate income households. So y'all, the the home program is very flexible.
▶ 1:02:03It provides funding dedicated exclusively to increasing the availability of adequate affordable housing for low and very lowincome households. The program places a particular emphasis on giving states and localities flexibility in how they achieve their affordable housing goals and funds and can be used for a variety of activities related to both rental and owner occupied housing. Miss Bowie, can you discuss instances in which home funds were used effectively on any project?
▶ 1:02:33Just give me an example of a project on how it was used effectively. Absolutely. Um, recently in Savannah, Georgia, we did use home dollars to redevelop a public housing site into 484 modern homes. These are multifamily affordable housing for families, seniors, uh, folks exiting homelessness. We leverage those home dollars in conjunction with housing tax credits.
▶ 1:03:00Um the layering of those uh funding sources. Often it takes many many uh multiple funding sources to get affordable housing built. So the streamlining of those regulations associated with all of the funding sources is critically important to building that those housing faster. So, it's the streamlining that made this be more effective for you said over 400 people for affordable housing in Savannah, Georgia.
▶ 1:03:30Over 400 families. Yes. Thank you, Miss Boh. Y'all, the home program is just one of the many things that President's Trump's proposed budget that he's looking to eliminate. House Republicans in this administration are pretending that the private market can fix the affordable housing crisis. We must do something about this together. Chairman Flood. Thank you and I yield back. Gentlewoman yields back. The gentleman from Montana, Mr. Downing, is now recognized for five minutes. Thank you, Mr. Chair.
▶ 1:03:58Uh thank you for holding this important hearing. Thank you to the witnesses. Uh you know, housing is uh obviously on on all of our minds and solving problems. I really see it as integral to the, you know, the the basis of the American dream is being able to own your own home and and finding solutions, especially for those that have have barriers. Um, you know, the United States is over $36 trillion in debt and taxpayer dollars are precious. I support efforts to make sure they are used responsible responsibly.
▶ 1:04:28So, it's important that we do um uh think very strongly on how we get the most bang for our buck. You know, the home investment partnerships program created 1990 is HUD's largest block grant program dedicated exclusively exclusively toward affordable housing. and the program receives over a billion dollars in funding annually. Um, I'm going to start with Miss Pototts.
▶ 1:04:51Uh, can you share examples of how home program funds have been used to attract additional private or philanthropic philanthropic capital and what barriers remain in maximizing that leverage? We have lots of corporate partners, but many of them are not able to fully fund a house. For instance, uh public supermarket charities gives us $50,000 a year.
▶ 1:05:16That will not fully fund a house, but we can pair that with home dollars and uh provide a home, build a home for a family, um with with that paired funding. Um we also um can build handicap accessible housing for for families uh and which they would never be able to even find much less afford um otherwise. And do you see barriers to this type of investment, these philanthropic or private investments?
▶ 1:05:45You know, there's there's only so much philanthropic and private investment available, especially in communities like mine, which are not huge communities. Um, you know, it it is uh a wonderful thing. Maybe 20% of our funding in terms of new home ownership comes from home and then the other 80% comes from uh private funders. uh whether it's foundations um you know um businesses, faith-based organizations, churches, and others.
▶ 1:06:16Thank you. You know, my uh my district, the second district of Montana, is very rural. In fact, it's uh the largest congressional district by land mass other than Alaska. We've got uh very long roads, a lot of dirt, small communities, very r very rural. Um I'm going to move to Miss George here. Uh, can you describe any differences you've noticed in the home program success in urban and sub suburban areas versus rural areas? Absolutely.
▶ 1:06:46Thank you, Congressman. Uh so we administer the program for the state and what we find is that the developers that um are prepared to administer the home program and meet the requirements um of both the environmental review section three um the four horsemen as the chairman says um the they need to be prepared and so the number of people that can actually
▶ 1:07:16or developers that can respond to an RFP request for proposals um is smaller because they don't have that uh experience to actually administer the program. So what we find in our rural communities is we limit the number of contractors that can actually apply and carry out a construction project which is a challenge because you're trying to get as much competition in the community as possible to get the best product.
▶ 1:07:43So, how else could this be reformed to better serve these uh municipalities in in rural or underresourced uh participating Thank you, Congressman. Uh what we're proposing is that uh the threshold uh for these requirements be lifted to 50 units. Um that way we can ensure that we're getting the most people applying to rural projects so that we can actually complete these projects in a timely way. Thank you.
▶ 1:08:12what what additional performance metrics or public reporting uh would you recommend HUD publish to give Congress and the public clearer insight into the home program's cost Thank you, Congressman. That's a good question. Um that's actually one that I would like to come back uh with information on at your request. Anybody else like to respond to that last one? So just to um make sure I I understood.
▶ 1:08:42So the question is what could HUD provide to make sure that these dollars are going as far as possible? I think what we have seen um with the home program especially when you're looking at the economic benefits both to the number of new units that have been constructed as well as the impacts to the local economy. Uh those are two really critical points that are that are helpful to understand. Well, thank you for very much. I've run out of time, Mr. Chair. I yield. Gentleman yields back. The gentleoman from Michigan, Miss Talib, is now recognized for five minutes.
▶ 1:09:11Thank you so much, uh, Mr. Chair and my colleagues and the witnesses here today. Uh, it excites me to actually talk about affordability and housing of this some of the most real issues for my residents back home uh, in the 12th Congressional District in Michigan. However, it's it's hard to sit here and have detailed policy discussion um when the president of the United States has called for eliminating the home program entirely in addition to cutting rental assistance by 43%.
▶ 1:09:44In the middle of a housing crisis, I'm not here to blame anybody because it existed under the previous president and now it's here in the current president. But to cut rental assistance by such a drastic amount is immoral. Already this administration has repealed much of the fair housing protections that many of my residents, disabled, LGBTQ, black, Latino, various moms with all of it.
▶ 1:10:12They canceled grants to organizations that help enforce fair housing laws and fired hundreds of HUD staffers. But I do want to take this opportunity though to discuss how we can improve the only federal block the only federal block grant focused exclusively on affordability uh uh affordable housing for our low-income households not just in Detroit in all of our under current program requirements.
▶ 1:10:40For example, the funds must be committed within 24 months or they expire. So organizations in my district for instance have said that this makes it very very hard for them uh for smaller emerging affordable housing developers without mature uh what we call capital stacks uh to access funding. So Mr. George or Mr. Oberdoer like uh Misser if Miss George or u Mr.
▶ 1:11:04um Obeder do you know of early stage projects uh or emerging developers who have experienced similar difficulties as you know accessing uh home funds? If so, what are some of those challenges that they face? Thank you, Congresswoman woman, uh for that question.
▶ 1:11:24Um it's an excellent question because 24 months it sounds Uh the challenge is is the development timeline for uh multifamily development takes a while to get all of the approvals for the funding. And so in Colorado, we have been uh trying to expedite the processes and the approval processes throughout the the the time frame of when you have an idea through when you start construction and complete construction.
▶ 1:11:53The challenge is it still is taking 24 months. Is everything working perfectly? And so what we're proposing from CASDA is to extend that time or to eliminate that commitment period for the home program. Yes. Uh, thank you for that question, Congresswoman. And I would agree.
▶ 1:12:12Um, the 24-month commitment makes it very difficult to make development deals, and especially when you're already dealing with layered subsidy and layered funding streams are challenging to do in the first place. That 24-month commitment makes it very hard to get everything in line. Uh, we would agree with Kazda to eliminate that 24-month commitment, especially knowing that there's a four-year deadline um to complete projects with home dollars. So, you know, that things would move forward. I agree.
▶ 1:12:40Uh, turning to some of the other proposed changes that, you know, I appreciate in the home reform act, uh, it does aim to address the housing affordably affordable crisis. I I enjoyed the intent, but sometimes implementation, well, all the time implementation matters. And so, however, I'm worried that in expanding the eligibility up to 100% of AMI, the funding won't go where it's most needed.
▶ 1:13:04And so in Detroit area for instance, the wealthier suburbs push up the AMI uh the average medium income. Uh so you can see already the disparities in in that regard. So to any of our panelists, can you how do we ensure that uh the funds are going through where the greatest need is? Uh thank you for that question, Congresswoman. And I think we can all agree that there's a real need for affordable housing across the board right now.
▶ 1:13:31Um, one of the things that's so important about home is the fact that it does provide affordable housing for lower inome families. And so I would recommend if there were conversations or discussions about potentially increasing the AMI, that would also need to go handinhand with an increase to the program, additional funding could ensure that you could grow the home program to potentially have eligibility go up to 100% AMI while still being able to serve those families. But that funding would be critical to make that work.
▶ 1:14:00I don't have much time, but I I can tell you if anybody has any other remarks, but I just caution my colleagues, the home program is irreplaceable. It it works well when we implement it the right way. And so I just urge my colleagues to please reconsider in supporting elimination of the home program. Thank Gentlewoman yields back. The gentleman from South Carolina, Mr. Timonss, is now recognized for five minutes. Thank you, Mr.
▶ 1:14:25chairman, and thank you to our witnesses for being committed to testifying today, even with our fund schedule changes. Uh, today's hearing topic is a piece of a much larger problem, government efficiency and contradicting regulatory requirements. As I examine the home program, I discovered that many policies, though often well-intentioned, frequently contradict one another, making it much harder to solve our nation's housing supply problems. This creates unnecessary challenges and places a heavier burden on those working within the system.
▶ 1:14:54Given these complexities, it is essential to clarify the expectations placed on participating jurisdictions. To better understand these obligations and how participating jurisdictions manage program requirements, it is important to hear from people in the field who work with the program day in and day out. Uh, Miss George, what are the core responsibilities of participating jurisdictions that receive home program funds? Thank you, Congressman. That's a very broad question.
▶ 1:15:24Um and so I'd say the ultimate responsibility is ensuring affordable housing is built and is serving the intended um constituents of that state or jurisdiction. And so it would be initially uh ensuring that there's competition in application. And then it's ensuring and reviewing that there's a viability of a project that's being done.
▶ 1:15:50And then um as you go to contracting, ensuring that people are following through with what they committed to do through their application and their contract. and then the long-term viability and ensuring that into the future that people are actually being housed as was the commitment in the original contract. Thank you for that. Can you walk through the flow of home program funds from HUD to participating jurisdictions and then developers or project sponsors just how the money flows through the system?
▶ 1:16:21Am I am I stretching? Thank you, Congressman. Okay. Um so uh I believe that uh Congress would appropriate the funds and we are hopeful that Congress appropriates the funds because there is a tremendous benefit uh to people throughout the country for these dollars. Um once they're appropriated to HUD, HUD then goes through the um assessment of how those funds should be uh divided up throughout the country.
▶ 1:16:50Is that based off of the census and population densities and co afford costs of different areas? That is correct. It's uh based on need based on the statutes that you all create. Um once the funds come to whether they're the state or through a participating jurisdiction, a local jurisdiction, um we would know what our allocation would be and from there we would have a competitive process where um applicants
▶ 1:17:20whether they're a developer, a nonprofit like Habitat would or Mercy Housing would apply for those funds because they have a great idea or they have a pilot of how they want to serve people And so, uh, from there they would apply, they would compete with other applicants. Um, then, uh, that jurisdiction, whether it be state or local jurisdiction, would um award those funds in the state of Colorado.
▶ 1:17:48We do that through our state housing board in a public meeting. Uh, from there, we contract for those funds. And so, the recipient, developer, would actually administer those dollars. uh whether it be a project or a program and then people would move in once the housing's built. And I would imagine there's um continual verification that they are indeed eligible for the the assistance.
▶ 1:18:16Um I I'll just I'm running out of time. I'll finish with this. Ultimately, it's our responsibility in Congress to streamline government operations and improve the efficiency of all federal programs. We're literally running out of money. We have $37 trillion in debt. We got a $1.8 8 trillion dollar annual deficit. And we must carefully review each agency and program to eliminate waste, uh reduce duplication, and ensure the American people can easily and fairly access the services the government provides.
▶ 1:18:45I look forward to continuing discussion uh on the home program and working across the aisle to find practical solutions during this Congress. Uh thank you, Mr. Chairman. I yield back. Gentleman yields back. The gentleoman from Massachusetts, Miss Presley, is now recognized for five minutes. Thank you, Chairman Flood and Ranking Member Clever, uh, for this hearing today. Thank you to our witnesses for joining us today and for your work in our communities.
▶ 1:19:18Our seniors are being displaced from homes that they've lived in for decades. Young families can't afford to buy and lowincome renters have barely enough to get by. Too many families are one miss paycheck away from eviction. The home program was created to give cities and states the tools to build and preserve affordable housing. But for decades, Congress has underfunded it.
▶ 1:19:45And now the Trump administration wants to eliminate the home program completely. This is the same administration that has already fired 780 housing agency staff, slashed half of all fair housing programs or grants rather, repealed critical housing discrimination enforcement, and proposed a budget that guts nearly every rental assistance program. Make it make sense. You can't.
▶ 1:20:16It is unconscionable. When we say housing is a human right, I know some people think that's like a bumper sticker slogan, what we mean is no child sleeps in a car. No senior is pushed into a shelter. No survivor is trapped in an unsafe home. We don't lack the resources to make this vision a reality. Simply the empathy and the political will.
▶ 1:20:45Miss Bley, we hear a lot about streamlining the home program. I agree that excessive red tape can drive up costs and slow down urgently needed housing. Where do you see the most opportunity to reduce burdens and delays without weakening tenant protections or environmental standards? Thank you for the question, Congresswoman.
▶ 1:21:10Um, for example, in markets where we develop high-cost markets, for example, in California, it often takes six to eight different funding sources uh in order to build that affordable housing.
▶ 1:21:26Uh the Turner Center um in California cited a study in which they examined LITC housing credit projects and found that for every additional funding source um it adds four months to the start of construction and an additional $20,000 per residential unit to develop. So the streamlining there would be to align regulations um upfront.
▶ 1:21:52Um, for example, housing credits are exempt from BABA, but often we use the home program as a topper and an essential gap financing in order to make those projects happen and to target deep affordability for residents. So, aligning the regulatory requirements to the primary funding source would be absolutely important. All right. Thank you, Miss Bo. I want to get an answer, one more answer on the record here.
▶ 1:22:20Under current HUD regulations, survivors protected under the Violence Against Women Act must get jurisdictional approval for external transfers when survivors request to move to a different property. From your experience, how long do these transfers typically take? And have there been instances where this delay endangered survivors or prevented them from accessing safe housing? That's an excellent question, Congresswoman.
▶ 1:22:47Uh, I'm actually not prepared to speak on that particular topic today, but I would be glad to follow up in writing. Anyone else? Okay. All right. Well, I want to be unequivocal. The affordable housing crisis didn't just happen on its own. It's the result of decades of disinvestment in our housing programs. In Boston and surrounding areas, the average monthly rent for a two-bedroom apartment has skyrocketed to over $3,600. In the Massachusetts 7th, more than 27% of renters are severely costburdened, paying over half of their income in rent.
▶ 1:23:17The home program is one of the few federal tools we have to change that. But instead of strengthening it, the Trump administration wants to do away with it alto together. This is the moment to increase investments in housing, not defund housing agencies and programs that are making a difference. This is deeply consequential um for our survivors of domestic violence and and so many more. Thank you. I'm going yield back. Thank you.
▶ 1:23:45The gentleoman from Colorado, Miss Patterson is now recognized for five minutes. Thank you, Mr. Chairman, and thank you all for being here today to discuss such an important issue. A special thank you to Miss George who has faithfully served our Colorado in the department of local affairs for over 15 years and has spent the last 10 years as the director of the division of housing. We your Allison is set to retire this fall and will be sorely missed. So thank you so much for your service to Coloradoatans in our state.
▶ 1:24:15Housing affordability is the number one pain point that we hear from constituents. I you know their inability to afford to put a roof over their head, the number one most basic necessity is becoming harder and harder. And according to the report from the National Low-Income Housing Coalition, Colorado is now the sixth most expensive state in the country. And the median sale of a home in Colorado roughly doubled over the past 10 years.
▶ 1:24:43People are in experiencing homelessness at an increased rate. Low-income renters and aspiring homeowners are feeling the pressure of these rising costs. And the home program has served as a vital lifeline for communities and families in Colorado by providing home buyer assistance, housing rehabilitation grants, and direct rental assistance.
▶ 1:25:03I'm grateful to the chair and the ranking member of the subcommittee for bringing us together in a bipartisan way to improve the home program, but I am deeply concerned that the very program we're discussing has been proposed to be cut by the by Trump's budget. So, I hope that we can continue to show bipartisan support for this program as it goes through through the appropriation process. And unfortunately, with housing, like so many complicated issues, there is no silver bullet.
▶ 1:25:32And it is really needs to be an all hands-on deck approach and investing in expanding programs like home is a critical step forward. Uh with that I have a few questions. Uh so Miss George as you know uh one of the many reasons that that the state and local localities target home funds is that the program is quite flexible to meet the needs of the community. And I would love to hear from you on how Colorado has explored different uses for the home program to meet community needs.
▶ 1:26:03Thank Thank you, Congresswoman, and I appreciate you. Um, so what I would really like to highlight um is that flexibility that you mentioned. Um, we have been able to pilot things in Colorado uh that we would not have been able to do but for the federal home program. Uh, tenant-based rental assistance is something that we used um that home allows.
▶ 1:26:30We actually piloted a program uh first in Mesa County where we were partnered with the local uh school district and in the school district children were identified as being homeless and with the home funding we were able to work with the local housing authority, the local school district to partner that family and provide the housing assistance to ensure that that child had a place to call home.
▶ 1:26:58And so we've been able to expand that program because of the seed funding from the home funds um throughout Colorado. So thank you and thank you for your support of the program. Well, it's I I I love that innovative way of how you're helping support families and being able to identify them when they through the through the schools and the education system and make sure that they get the support that they need. I So thank you for that.
▶ 1:27:25And Miss Bohei, similarly to our state in Colorado, California has been confronted with astronomical housing prices that have priced out not only low-income families, but working and middle-class families who are now struggling to pay rent and keep food on the table. And so, how does the current structure of the home program limit your ability to connect working and middle-class families to resources like tenant-based rental assistance? And how can we expand the income thresholds to meet that need?
▶ 1:27:56Thank you, Congresswoman, for the question. Um, we do believe uh aligning the regulations really focused on the tenants um would be uh very beneficial. For example, uh often our projects uh across the nation and certainly in California will utilize tenant-based vouchers which have a certain level of income restriction. On the one hand, then the home program has a different level of in income restriction. a lot of back and forth with the agencies to really figure out how to implement that.
▶ 1:28:26All the while you have residents living side by side with different sets of requirements um in which they in which they live in their homes and it creates operational challenges. Well, I thank you all for this discussion. I know that we need to streamline some of these processes, making sure we're not doing our job if we're directing dollars and trying to help support communities and they're unable to actually take advantage of that of these dollars to meet the need uh because of the barriers that they're facing at the local level.
▶ 1:28:55So appreciate uh the discussion today and look forward to working with all of you on addressing one of the most important issues uh that we need to force to focus on here in Thank you. The gentleman from Oregon, Miss Binham, is now recognized for five Thank you to all the witnesses for your testimony and thank you to Chairman Flood and Ranking Member Clever for convening this important meeting.
▶ 1:29:22As you can guess, in Oregon, we too are struggling with a lack of housing supply, which has created, of course, a housing crisis, and buying a home has become out of reach for far too many Oregonians. and that has become a top priority of mine in Congress. One area that I'm interested in is modular construction, particularly for multifamily developments. And unfortunately, many of our housing programs currently do not support modular construction.
▶ 1:29:53And so the idea behind modular construction is that instead of building the entire house at the location, large sections are built offsite and transported to the location. So imagine if you wanted to buy a new car, but you had to coordinate with a mechanic, an automotive engineer, an electrician, a welder, and six other contractors to come to your driveway to design it. The cost would be astronomical.
▶ 1:30:20So the question really remains is um why would we do that to housing? So instead modular housing would potentially bring down home costs by making building a house easier, quicker, and cheaper. So my question is for Miss Pototts, you're on the hot seat.
▶ 1:30:39Um, currently HUD programs, including those supporting multif family housing, do not explicitly permit or facilitate off-site modular construction despite its potential power to lower housing costs. And so, given your experience, how do you view the role of modular and off-site construction in addressing the affordable housing shortage?
▶ 1:31:01and what specific barriers regulatory, financial or otherwise, need to be addressed in order to make it scalable through HUD programs? Thank you for your question. I would say that um modular construction is one of our tools in our tool shed.
▶ 1:31:20Um, you know, in Tuscaloosa, we're very fortunate that we can build year round outside, um, and on our build sites, but I know that our friends who live in, uh, colder clims, you know, in in the winter that they often build their homes inside and then move them, you know, out to the build site. I think that's an important tool.
▶ 1:31:42Um it it's not necessarily for everybody, but I do believe that that could increase the um the supply of affordable housing and uh it needs to be one of the tools that is allowed by home Thank you. I yield back. Thank you. Uh the gentleman from California, Mr. Licardo, is now recognized for five minutes. Well, thank you.
▶ 1:32:10Uh I just I'm appreciate uh Mr. Chair and I I'm sorry that uh Chair Flood isn't here to hear me praise him, but I do want to thank uh Chair Flood for his leadership uh in convening this and his collaborative efforts and working ranking member Cleaver and I'm grateful for ranking members uh collaboration as well well on this issue and on many others. Uh we're not seeing enough of it in Congress these days and it's refreshing to see it happen here. I also want to thank you for allowing me to wave on.
▶ 1:32:39Um, you know, Chairman Flood asked me about my experience as a mayor in San Jose with home funding and and I didn't have a lot to say and the reason why I didn't have a lot to say and I think a lot of other large city mayors would have said the same is that it's just not enough money. Um, we don't really see home as being a major mover. Uh, at times it provides gap funding in a very complex uh stack of financing uh in projects.
▶ 1:33:07uh according to the Urban Institute, maybe 20% of low-inccome housing tax credit projects use home funding as a gap source of funding. Uh but for the most part, there's just not enough dollars there. Uh and so I I join my colleagues in saying we can't be cutting this. Um we certainly can't and we've already seen home funds decline since 2011. Uh in real in in absolute terms, in real terms, they've been declining for decades, uh inflation adjusted terms.
▶ 1:33:35And now we've got a proposal from this president to cut the funding by 43%. And uh right now we know there's not nearly enough funding to address the housing crisis we have. Now all that being said, let me just say I I really think um uh the chair for the home reform act uh the proposal that we see here I think gets a lot right. I certainly support exemptions on the Build America Act uh eliminating duplicative reviews under NEPA.
▶ 1:34:01probably would have even gone farther than that to explore categorical exclusions for infill affordable housing. I'd like to see the greater flexibility of the definition community housing development organization lengthening the 24-month commitment deadlines, the expansion of the use of funds for utilities. I was a little hesitant support lifting the threshold in Davis Bacon, but I think Miss M Miss Bohey's uh testimony was persuasive to me and I know that Mercy does great work. We've worked with them many times uh in my neck of the woods.
▶ 1:34:30Uh the one concern I have though is the change in the income ceilings and I hope that perhaps we can talk about this further before uh this bill reaches us for markup. Um and the bottom line really comes back to what I said at the beginning which is there is not enough money. There's not enough federal money for everyone. Home funding I already described has dropped in several different ways uh in the last decade and a half. And the free market is going to provide options for some families.
▶ 1:34:58We know that uh if they're at 95% 100% of area median income those options may be limited but there are options. My concern is that for families at 60% of area median income there are no options except subsidized housing uh extreme except we're obviously very very uh poor ones uh poor options I should say.
▶ 1:35:19Right now, we've got 9 million extremely low-income families in this country who qualify for section 8 uh funding or vouchers, and about one quarter of them actually get vouchers. Uh we've got millions of families without and that's just extremely low income. If we go to the very low income and low-income categories, now we're into tens of millions of families who desperately need help uh with very poor f uh housing options that they can't afford.
▶ 1:35:45And so I am very concerned about diluting this limited pool and expanding it to 100% of area median income uh when we know that there are developers who can profitably build in many jurisdictions not all but many jurisdictions to address that market segment. So my question I guess I'll start with you Miss George since you've got a big portfolio in Colorado. Are you finding that, hey, there's a problem.
▶ 1:36:08We don't have enough proposals for sub 80% AMI housing that we should uh the eligibility for home funds to up above well above 80%. Thank you, Congressman. I will answer the first question, which is do we have a limited supply or um number of applications for below 60% AMI? Absolutely not. Um there is a tremendous need uh for affordable housing.
▶ 1:36:38Um that said, I think the the beauty of uh home is the flexibility of home. And so it's a matter of responding to the local needs of your community. And so um it might be that firsttime home buyer and then it also could be that 30% AMI and below. And so the example that I used, Harvest Hill in Broomfield, um I'm most enthusiastic.
▶ 1:37:05It's 152 units, which is fantastic, but it's those 30% AMI units. Um and you know, I am as a houser excited about the expansion of the tax credit program, but the home program provides the essential gap funding in order to achieve that lower AMI. Thank you. I I yield and I look forward to working with my colleagues on the other side of the aisle on this issue. The chair now recognizes from Tennessee, Mr.
▶ 1:37:33Rose for five minutes. Thank you and want to thank Chairman Flood and and Ranking Member Cleaver for uh convening today's hearing and thank you to our witnesses for your time today and for being with us. I would like to applaud Chairman Flood and Ranking Member Clever for their work on the discussion draft of the Home Reform Act of 2025, which is attached, of course, to today's hearing. It's been over 30 years since the last time the home program was reauthorized by Congress.
▶ 1:38:00The world has changed a lot in that time, but unfortunately, many of the home programs outdated requirements have lived on. These outdated requirements can increase cost and needlessly add time to complete completing housing projects.
▶ 1:38:17I am pleased that today's discussion draft includes common sense changes to the home program including exempting uh national environment pol environmental policy act mandates and it creates a small project exemption that will ease Davis Bacon workforce requirements as well. The nation's shortage of homes is at a crisis level in many parts of the country and I think we're all aware of that.
▶ 1:38:39I look forward to working with Chairman Flood as well as Ranking Member Clever to successfully reauthorize the home program which is an important step Congress can take right now to help alleviate our nation's housing shortage. Mrs. pots. Uh, one theme that, uh, this commit subcommittee has heard over and over again is the unaffordability of starter homes in so many areas around our country.
▶ 1:39:04It was really I was really happy to see that you had an entire section of your prepared testimony um, devoted to barriers to constructing or rehabilitating affordable starter homes. Could you describe your personal experiences with barriers to affordable starter homes? I'd be happy to. Thank you for your question. So, we have a local developer who is a partner and they have been building affordable starter homes uh in the Cherrystone neighborhood for uh six iterations.
▶ 1:39:34They had another area adjacent that they were going to develop. They started with the infrastructure, but by the time they got threequarters of the way through the infrastructure, they realized that what was going to be affordable housing because of the increase in interest rates and the increase in building materials and things were they were not going to be affordable houses for the starter market. So, they approached Habitat for Humanity.
▶ 1:40:01They donated some of the 32 lots and they sold others to us and we are able to um develop those homes for firsttime home buyers. And these are people um you know people who work in environmental services, people who work in food service, um our our city Tuscaloosa City Schools bus driver for special needs children. Um these are people who would never be able to afford homes otherwise to purchase a home.
▶ 1:40:29And Miss Pototts, if if Congress, working in partnership with state and local governments, were to begin removing some of the barriers to affordable starter homes that you identified, could this help enhance the effectiveness of the home program, particularly if Congress is able to successfully reauthorize the Yes, it would decrease the amount of time from when we get to our concept to through the environmental review process, all of those things. It would decrease the time.
▶ 1:40:58It would also actually increase the number of contractors that we have who um want to bid on projects because some of our contractors just don't want to have to deal with the federal regulations. It's it's not that they're not paying, for instance, Davis Bacon. It's not that they're not paying those wages. They are, but it's just the the amount of paperwork required to comply.
▶ 1:41:23many of our really small contractors just don't have the staff to uh to make that Thank you, Mr. Oberdorf. Your testimony focuses on the significant burdens housing projects face as a result of the home program's required environmental reviews. You specifically highlighted that in many cases if projects receive additional funding, they are required to undergo a second environmental review.
▶ 1:41:48Can you discuss the compliance burdens that environmental reviews place on housing programs and the importance of environmental review reform in any reauthorization of the home program in 30 seconds? Yes, thank you for that question uh congressman and obviously we need to find the right balance with environmental reviews but what typically occurs especially with home funds is that it adds to delays to the project and there are two things I'd point out.
▶ 1:42:13The first is that oftentimes when you're using home financing to fill a financial gap in a project, that means you have other timelines that you need to meet as well, that could slow down the process. The second is you've oftentimes already done an environmental review for either the project that you're working on. It's just once you add that additional gap financing through the home program because of the requirements, you need to do that second environmental review. So, it becomes duplicatus. Thank you. Our time is expired.
▶ 1:42:41I yield I would like to thank all of the witnesses for their testimony today. Without objection, all members will have five legislative days to submit additional written questions for the witnesses to the chair. The questions will be forwarded to the witnesses for their response. Witnesses, please respond no later than August 21st, 2025. This hearing is adjourned.
▶ 1:43:16Great job.