Volume 11; No. 2; September 1999
New Players on the Block: HUD's Community Builders
By Larry Bush, Communications/Media Officer for Pacific/Hawaii Region
and Ruth Osunu, Community Builder Fellow, U.S. Department of Housing and
Last spring, Andrew Cuomo, Secretary of the U.S. Department of Housing
and Urban Development (HUD), embarked on an ambitious overhaul of HUD's
multi-layered bureaucracy. The labyrinth of HUD programs and offices was
becoming increasingly cumbersome, making it difficult for the "outside
world" to navigate its organizational structure. To remedy the problem,
Secretary Cuomo dismantled a number of institutional layers, and redesigned
HUD staffing across the country. The result was the creation of a corps
of `Community Builders' whose main purpose is to increase access to the
myriad of HUD's programs.
There are over 400 community builders who serve as central points of
contact in each of the Department's 81 offices across the country. Each
local office is headed by a senior community builder who manages a team
of community builders. Community builders are career HUD professionals
who serve specific geographic areas and have extensive institutional and
industry knowledge. HUD also added a select group of community builder
fellows: individuals recognized for their talents in the non-profit or
private sector who agree to serve two-year terms at the Department.
There are 17 local HUD offices within the Federal Reserve's Twelfth District,
which is comprised of Alaska, Washington, Oregon, Idaho, Utah, California,
Arizona, Nevada and Hawaii. Each office now operates under a written business
and operating plan that sets out specific annual goals. In the San Francisco
office for example, a team effort is underway to address the looming issue
of owners opting out of HUD's subsidized housing programs, an issue that
threatens to move rents up to market levels. With San Francisco already
in crisis over affordable housing, a further loss of units would be deeply
felt. In other offices, priority issues include redeveloping brownfields
into economically productive sites, addressing fair housing issues, expanding
homeownership, and increasing local investment by community banks.
Community builder projects range from broad-based, regional efforts to
more targeted, local efforts. Regional initiatives include the facilitation
of new partnerships to expand the capacity of housing developers, better
serve the needs of homeless people, and balance the ratio between jobs
and housing. A local example is a program in Guadalupe, Arizona that trains
high school dropouts, through a school/work construction program, to build
new homes for low-income families.
Opportunities to Work with Financial Institutions
HUD community builders are charged with finding new ways to leverage
their resources, and are interested in developing unique partnerships
with financial institutions. One way is through the preservation of affordable
housing units. Approximately 10,000 FHA-insured multifamily projects contain
housing units subsidized by Section 8 project-based assistance contracts.
Many of these contracts are due to expire over the next five years, and
HUD will need to devote ever-larger portions of its budget for finding
alternative ways to keep these units affordable.
Unfortunately, numerous units have already converted to market-rate rent
levels since, in 1996, Congress authorized a multifamily portfolio reengineering
demonstration aimed at reducing funding for FHA's mortgage insurance and
rental assistance programs. In addition, the fiscal 1997 budget de-emphasized
project-based subsidies, and instead allowed tenants to use these subsidies
for the rental housing of their choice.
Even with subsidy vouchers in the hands of tenants, there is still a
need to provide housing units that are affordable. To assist in this effort,
community builders are working with non-profit organizations to acquire
properties from owners who want to end participation in the subsidy program.
The financial restructuring of these properties is critical to preserving
their affordability, and requires the participation of financial institutions
interested in extending mortgage loans on multifamily properties.
In addition, HUD has developed new cooperative lending models targeted
for cities whose economies are lagging. These co-lending opportunities
are focused primarily on small business and infrastructure development.
Finally, HUD is in the process of expanding their Empowerment Zone/Enterprise
Community (EZ/EC) program, which will open up a number of new lending
and investment opportunities in those areas. New EZ/ECs will be announced
To learn more about Community Builder programs in your urea, please use
the contact information that follows. For information about other HUD
programs, consult HUD's award-winning Web site at www.hud.gov.
HUD's Senior Community Builders
Federal Reserve's 12th District
ABOUT THE AUTHORS
Larry Bush is HUD's communications/media officer for the Pacific/Hawaii
region, comprising California, Arizona, Nevada and Hawaii. He works in
the San Francisco HUD office, and has a 25-year background in local, state
and federal government as well as in news reporting as a journalist and
columnist for various newspapers.
Ruth Osuna is a community builder fellow in HUD's Phoenix, Arizona office.
She has more than 20 years of experience in the public and private sectors
in a variety of leadership roles in the areas of community and economic
development, public administration, management, public finance, housing
development, and finance. For the past 2 years as community development
manager for Division 3 of Norwest Mortgage, Inc., Ms. Osuna has initiated,
coordinated, and directed special programs to increase the company's lending
efforts to low- and moderate-income home buyers and minority communities.
From 1991 to 1996, she was vice president, community development and fair
lending officer for Bank of America Arizona.