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Gulf Coast Housing Recovery Bill Expected in Senate

Hurricane Recovery
Memo to Members: Vol 12, No. 24, June 15, 2007

Senate Banking, Housing, and Urban Affairs Committee Chairman Christopher Dodd (D-CT) and Senator Mary Landrieu (D-LA) announced on Friday, June 15, that they will introduce the “Gulf Coast Housing Recovery Act of 2007” early in the week of June 18. The bill will do many of the same things provided for in H.R. 1227, the “Gulf Coast Hurricane Housing Recovery Act of 2007,” which passed the House of Representatives on March 21, and adds provisions that improve on the House bill.

In a joint press announcement, Senator Dodd said that “to fully recover (from Katrina), families (in the Gulf Coast) need a place to call home.” Senator Landrieu said, “After weeks of collaborative work with colleagues, Louisiana families, and key stakeholders, the bill Senator Dodd and I are offering builds on a strong foundation crafted by Congresswoman (Maxine) Waters (D-CA), Congressman (Richard) Baker (R-LA), and Chairman (Barney) Frank (D-MA). Both bills sound a loud and clear call for bringing our people home and making our communities whole again.”

Like the House bill, the Senate bill will provide for one-for-one replacement of public and assisted housing damaged by Hurricanes Katrina and Rita and the right to return for all displaced residents who were in good standing at the time of their evacuation. The bill authorizes funds needed to repair and rehab all public housing in the affected areas. The Senate bill adds new housing mobility provisions to aid voucher holders in gaining greater choice in housing.

The Senate bill requires HUD to seek a judicial receiver for the Housing Authority of New Orleans (HANO), a move sought by many low income housing advocates. HANO has been run by a HUD receiver for many years, beyond the statutory limits allowed for administrative receivership before a court must intervene. Given the conflict between HANO, i.e., HUD, and residents over the future of public housing in New Orleans, an objective third party will assure the residents’ interests are better protected.

The Senate bill increases the number of project-based vouches for new permanent supportive housing from 4,500 to 5,500.

Like the House bill, the Senate bill requires continued rent assistance for displaced households and transfers them to temporary Section 8 vouchers administered by HUD. Unlike the House bill, these vouchers are paid for with FEMA Disaster Recovery Funds that will be transferred to HUD. And unlike the program that HUD and FEMA are currently crafting, the rent that residents will be required to pay will be 30% of income, not the cumulative $50 a month for 12 months ($50, $100, $150, etc. ) that HUD is planning. There will be a minimum rent of $100 a month. Families still living in FEMA trailers will be offered rent assistance as well.

Both bills authorize $5 million for fair housing enforcement in the Gulf Coast. The Senate bill strengthens the reporting requirements for the states to improve accountability for use of federal housing funds appropriated for Gulf Coast recovery. At the same time. the Senate bill authorizes such sums as are necessary to complete Louisiana’s Road Home program. The Louisiana Recovery Authority recently announced a $3 billion shortfall in funding for the Road Home plan. The bill requires that Louisiana spend $1 billion of its own funds to fill the shortfall as a condition of more federal funding.

Finally, funding for the New Orleans Redevelopment Authority (NORA) is increased and uses of the funds are more specifically designated, including affordable housing for low, very low, and extremely low income families. A new provision requires HUD to give FHA foreclosed properties in New Orleans to NORA to create new low income homeownership opportunities. FHA is also directed to use pre-Katrina credit scores in determining qualification for FHA insurance.

NLIHC coordinated a sign-on letter supporting the bill. A wide array of national and Gulf Coast organizations have endorsed the bill, including housing, civil rights, legal services, faith-based, and anti-poverty groups.

A hearing is expected in the Senate Housing and Transportation Subcommittee before the August recess.

The NLIHC letter of support and the list of endorsers can be found at www.nlihc.org/.