For Immediate Release:

Thursday, May 3, 2007

(Washington, D.C.) - On Thursday, May 3rd Senator Patty Murray (D-WA) chaired a hearing of the Senate Appropriations Subcommittee on Transportation Housing and Urban Development to examine the Fiscal Year 2008 budget for the Department of Housing and Urban Development (HUD). HUD Secretary Alphonso Jackson testified at the hearing.

The following is Senator Murray's opening statement from the hearing:

Housing is one of the most important but least talked about challenges across our country today.

People don't want to talk about how close they are to losing their homes or not being able to afford their rent. I think there's something in our society that makes people feel like they've somehow failed if they can't afford housing. But with housing prices on the rise, it's a challenge facing more and more American families. In fact, housing has become the silent epidemic facing far too many communities across our country.

The reach of this epidemic was reinforced for me last month when I convened a roundtable on affordable housing in the Puget Sound region of my state.

I brought together realtors, bankers, along with representatives from public housing agencies and transit agencies. Together, we discussed the extraordinary financial pressures being placed on working families in the Puget Sound and how we might address them.

As families are forced to move away from their jobs in order to obtain affordable housing, citizens in a great many cities across the nation are spending an inordinate number of hours commuting from their neighborhood to their workplace and back. These are hours that they can't spend with their children and their families. These are hours when parents could be supervising homework or watching a little league game. Instead, they are spent crawling through punishing traffic jams.

Swedish Hospital is one of the premier medical centers in downtown Seattle in my home-state of Washington. The recruitment director at Swedish Hospital recently told a Seattle newspaper that more than half of the employees don't actually live in Seattle proper and it is typical for their employees to commute for at least a full hour to a home or a rental property they can afford.

It is not just young families seeking to own a home that can't find affordable housing. HUD Section 8 voucher recipients also struggle to find affordable rental units and landlords that will take vouchers. This means endless hours, often on public transportation, just to get to and from work.

As a result, Seattle continues to rank as one of the most congested cities in the country. And we have a great many cities facing the identical mix of challenges across the country.

The congestion problem has gotten so troubling that our Transportation Secretary, Mary Peters, has made funding for a number of new congestion mitigation initiatives the cornerstone of her 2008 budget.

However, as I review Secretary Jackson's 2008 budget for HUD, I do not see the same sense of urgency or importance being devoted to the problem of affordable housing. Instead, I see a budget that abdicates responsibility and shortchanges programs serving some of the nation's neediest citizens.

Despite the strong support by Republican and Democratic mayors and governors across the country, President Bush's housing budget again proposes to slash the Community Development Block Grant Program. This year, it's a cut of 20 percent, a reduction of almost three quarters of a billion dollars.

The President's budget fails to provide even an inflation adjustment for the Section 8 tenant-based housing assistance program. That means that, as rents rise, public housing agencies will have to trim the ranks of their Section 8 recipients, potentially throwing some of them into homelessness.

HUD's program for housing the elderly is cut by 22 percent - a reduction of $160 million - despite the fact that the number of needy seniors continues to rise. And HUD's program to house citizens with disabilities is slashed by 47 percent, almost in half, a cut of almost $110 million.

Funds to ensure that public housing is maintained and brought up to safety codes are slashed by 17 percent, or $415 million. Even programs designed to remove lead paint from low-income housing units with children are cut by 23 percent.

And the HOPE VI program that has allowed us to tear down some of the most dilapidated public housing and replace it with modern, mixed-income units -is proposed for complete elimination.

In fact, the President wants this subcommittee to go one step further when it comes to HOPE VI by reopening the Appropriations bill that he already signed for 2007 so that we can also eliminate the funding we provided for HOPE VI for the current fiscal year!

The President's budget for HUD is irresponsible and unacceptable on its face. But it is all the more startling considering his investment in housing and infrastructure in Iraq.

Over the past four years - the President has asked American taxpayers to spend almost $36 billion to build housing and utilities and other necessary infrastructure in Iraq.

Unfortunately, the Special Inspector General for Iraq Reconstruction has reported to us that a frightening percentage of that $36 billion has been wasted or stolen.

Despite these reports, the President has sought - and received - an additional $2 billion to rebuild Iraq in the Supplemental Appropriations bill that he vetoed just two days ago.

The President sees no problem in investing up to $38 billion to rebuild the nation of Iraq, but when it comes to rebuilding America's struggling communities through the Community Development Block Grant program, the President is calling for a cut of three quarters-of-a-billion dollars to the program.

In fact, the President is unwilling to provide even 10 percent of what we've invested in Iraq's reconstruction, to rebuild and provide some hope to the run-down neighborhoods here at home.

The President's budget and supplemental requests are a clear statement of his priorities. Unfortunately, far too frequently, these priorities are out of step with those of the American people.

As Chair of this subcommittee, I will work to put our budgets and our priorities back on track.

Earlier this year, we held a hearing with Secretary Jackson's Federal Housing Administrator, Brian Montgomery. During that hearing, it became clear that, at a time when we are facing a historic level of foreclosure and a potential crisis in the availability of loan capital for low and middle-income home buyers, the Federal Housing Administration (FHA) has become an increasingly irrelevant player in the market.

In my home state of Washington, while the FHA covered 80 percent of the home loan activity of the Washington State Housing Finance Commission some ten years ago, it covers only 20 percent today. Nationwide it represents only 3 percent of total mortgage volume.

I believe it is essential that we revive the FHA and make it a relevant player in the market again, especially now when we have a great many families facing foreclosure because of the upheaval in the sub-prime market.

I look forward to discussing with Secretary Jackson this morning how the FHA might develop solutions to keep these families in their homes.

I also want to discuss how the FHA can get back to the business of providing access to first-time homebuyers who want to live near where they work - who want to spend time with their families rather then time in ever worsening traffic jams.

Finally, I would like to examine with the Secretary what HUD is doing to address the housing crisis that faces the communities devastated by Hurricanes Katrina and Rita.

For weeks, Americans across the country were glued to their televisions simply overwhelmed by the pictures of tremendous devastation and unfathomable suffering of so many of our fellow Americans. The images were almost too much to bear - watching families without food and water, people who were trapped on their roofs, and people searching for their loved ones.

And, although the TV cameras have left the Gulf Coast - for far too many, the suffering continues still.

Damage estimates indicate that over 300,000 homes were damaged or destroyed by those hurricanes at a cost of over $67 billion.

Mr. Secretary, this is arguably the biggest housing crisis of the modern era.

This Committee invested an unprecedented level of resources to rebuild that housing stock and assist the region in their recovery.

I would like to hear from you exactly how the resources and legal authorities that we granted HUD are being used to improve the lives and communities of our Gulf Coast residents.

I would now like to recognize my Ranking Member, Senator Bond.