In the opening statement, several representatives expressed their views on public housing. The chairwoman maintained that there are problems with public housing such as neglecting the needs of existing public housing residents and underfunding. Rep. Lynch noted the shortage of staff required to maintain the quality of public housing. One congressman said flexibility in public housing programs is important. Most of the testimony concerned the HOPE VI program. The testimony is summarized below and copies of the written statements are available at; http://www.house.gov/apps/list/hearing/financialsvcs_dem/hchr_072909.shtml.
Highlights from Testimony:
One recurring problem identified had to do with the screening process. People receiving public housing are selected by private sector agents who may unfairly restrict applicants’ access to public housing services by the imposition of irrelevant credit requirements. Industry representatives responded that credit guidelines served to protect investors’ interests. Social responsible investors might counter by pointing out that credit guidelines imposed on subprime mortgage borrowers were also supposed to protect investors’ interests. They did not do so leaving some to question their relevance and fairness.
In general, fully evaluating the benefit of a public investment by simply looking at returns to a narrow group of people is inappropriate. One of the suggested program improvements involved making sure that HOPE VI program participants did not experience increased isolation as a result of participating in the program. In the table below, we show the interaction between isolation and improved housing. Thus, the most likely program outcome is a decline in quality of life for program participants.
| | Housing | ||
Isolation | | No Change | Slightly Better | Much Better |
No Change | Flat | Quality of Life improves | Quality of Life improves | |
Slightly Worse | Quality of Life declines | Quality of Life declines | Quality of Life improves | |
Much Worse | Quality of Life declines | Quality of Life declines | Quality of Life declines |