Assistant Secretary for Community Planning and Development (CPD) Mercedes Marquez testified before the House Financial Services Committee today on the strength of the HOME program in creating affordable homes and strengthening communities. The testimony was prompted by misplaced claims of mismanagement and stalled projects made by the Washington Post.
Marquez submitted testimony that the Post’s story “was full of numbers—and misstatements—but lacking in context and balance.” HUD has said the projects described in the Post represent 2.5% of 28,000 developments nationally while largely ignoring HOME’s strong track record of creating more than one million affordable homes. With the entire housing market suffering due to the economic downtown, Marquez stated that HOME program compares “very favorable to the private market success rate.”
Further, the Post labeled 700 projects as “stalled” when in fact HUD’s Office of the Inspector General (OIG) found this figure to be closer to 108 project delays and in fact these projects were delayed mainly due to the recession and have since been completed or terminated. Marquez also testified that the Post did not provide the data used in their story to HUD, even upon on her request, so it is unclear how the Post came to 700 project delays.
Alongside Marquez, the Assistant Inspector General for Audit at HUD’s OIG, James Heist, testified regarding his role as independent auditor of the HOME program. He found that the program needs greater internal controls and monitoring but stated that when compared to other HUD programs, it is doing reasonably well because of clear requirements built into the program that make the auditing process easier. Heist stated that while the program has been associated with fraud allegations, the OIG has recommended measures to rectify these challenges and CPD, for most part, has responded.
Members of the House Financial Services Committee were largely split along partisan lines in their questions on the HOME program. Most members stated they did not believe this program should end because of these allegations but they were concerned that taxpayers’ dollars not be wasted. Some members expressed a desire for greater oversight and control of what happens with program dollars once they are distributed to local grantees. Others members felt like the program is doing well, and that local governments should continue to control how the money is spent on the ground without HUD interfering. Further scrutiny of the program may well occur. The hearing will remain open for the next 30 days to allow for further testimony and questions by members of the Committee.
Read Assistant Secretary Marquez and Heist’s testimony on the House Financial Services Committee web site.