From the Office of Senator Kerry

Thursday, April 29, 1999

Washington, D.C. -- U.S. Senator John F. Kerry (D-MA), the ranking member of the Senate Banking subcommittee on Housing, and Representative Barney Frank (D-MA), ranking member of the Banking Subcommittee on Housing and Community Opportunity, today joined the Secretary of Housing and Urban Development (HUD) Andrew Cuomo to announce HUD actions that will preserve affordable public housing across the country.

HUD's new policy, a direct result of the advocacy of Kerry and Frank, will take immediate steps to adjust rental assistance payments to current market value under the Project-based Section 8 program for those contracts that will expire during the remaining part of this fiscal year. In Massachusetts, it has been estimated that this action may save 5000 housing units this year alone.

Senator Kerry said, "Ironically, as the economy continues to grow, we see an ever greater loss of affordable housing. This decision by Secretary Cuomo is an important step to address this critical problem. I look forward to continuing to work with Congressman Frank, the rest of my colleagues and the Administration on a long term solution to help preserve quality, affordable housing."

Congressman Frank said, "I was pleased to work with Senator Kerry on this initiative and I am very grateful to Secretary Cuomo and the Administration for using their legal authority to the fullest to prevent loss of affordable housing. I will work with my colleagues in Congress and with the Secretary to build on these steps. What people should realize is that we cannot preserve affordable housing if we continue making across the board cuts in the federal budget."

In 1997, Senator Kerry and Rep. Frank led efforts to include the Mark-to-Market legislation in the VA-HUD Appropriations bill for fiscal year 1998. This legislation authorized HUD to increase rents up to market, to discourage owners of higher priced Section 8 housing units from letting their contracts expire. Since that time, Kerry and Frank have been working intensively with HUD and housing preservation groups to develop a policy for preserving affordable housing.

In addition, HUD's plan includes the following:

As an interim stopgap measure, HUD will renew contracts expiring before the end of this fiscal year at increased rent payments (residents will continue at their current rent levels) for those properties most at risk of being lost to the assisted housing portfolio; this includes projects in very tight markets or where other affordable rental housing is rare.

HUD will seek to renew these contracts with 5-year terms. This both commits the owners to continuing with the program for at least 5 years, and gives the owners some certainty about the terms and conditions of the program for an extended period of time.

HUD will work with Congress to put in place a permanent policy aimed at preserving affordable housing and protecting tenants.

HUD will also seek authority to provide "sticky" or enhanced vouchers to keep tenants in place in cases where, despite the offers of increased rents, owners still opt-out of the program.

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