Tammye Trevino
Administrator
Rural Housing Service
Washington, D.C.
Good morning. It is good to be here with all of you. I get to know more and more of you as the months go on.
Not too much has changed since the last time we talked. Number one, we're still waiting on a 2013 budget. We're still waiting to see what comes out of Conference. We're hoping to get a Bill before the end of the year. We have some NOFAs in process; I know everyone is waiting on the 515, it won't be too long. Those are out there with the revolving loan fund NOFA. It should be in the next couple of weeks, and probably when we see one, we'll see the others follow. So they'll all go through processing at the same time.
So not too much has changed. We are celebrating Home Ownership this month across the country, so our emphasis for a while is going to be on home ownership and refinance. For the most part we're going to continue to work with you and more effectively with the White House policy group. We are still moving forward; we still have those states that are part of the pilots. We hope to get a lot more reports as the months go on. We do have a tentative stockholder meeting scheduled for July. For those of you who attended the stockholder meeting at the White House with the rental policy working group, we are going to have another this July. If you have gone to these meetings you know we try to hold them annually. We don't actually have a date yet; as soon as I do, I will make sure and get that to Colleen so she can get it out to all of you. But that's the big thing; we're hoping that we have our next steps for the Policy Working Group.
The pilot on the inspections has been started. We're very pleased that that's moving along. Stephanie White and her staff are doing a great job. Mike Steininger has taken over the 515, as well as the 538. He's also working on subsidy layering pilots across the United States as well.
I will tell you one thing that has really affected us has been the decrease in staff. We had our Salary and Expenses reduced to necessitate early-out buy-outs, where we lost about 600 employees. Many of those had been with us for 20 or 30 years, or longer. First of all, we can't back-fill them. Second, those folks who are taking their places don't have the years of experience like the ones who had been there. We lost a lot of staff; we still have great people working. We still have a committed work force that's out in rural America trying to help you.
We recently saw what the House budget did to us, a reduction of 28 million in miscellany, which is pretty significant. I'm not sure how we're to going to get the work out the door without reducing assistance. Something has to give.
I want to be very upfront with you, very transparent, because as you see the budget program dollars for some areas are going up and S & E dollars are going down. That doesn't make sense. You yourself would never increase your target delivery with your dollars without putting more people on it. It's becoming impossible for us to do it. We are in a position where we have stretched our resources as far as we can and the ability to use the dollars up is going to continue to be a challenge.
What that says, the work is going as fast as we can and we do have a very committed work force and want to get the job done. They want to make sure you get your projects. I don't see us slowing down; we feel we're going twice as fast as we ever have. While our staff knows what they are doing, they really have to research things; it's not in somebody's head that they can just call and ask; that person is not there any more.
So those are some of the issues we're having within the Department on the national level. But there are other things that you as a group have asked us to look into and we're doing that. We're in a position of where we're looking at anything that saves resources and saves us time, especially staff time. Look for tools like inspections to become a little more streamlined. We are looking at ways that we can do things a little simpler, a little faster, with fewer people. So we welcome the partnership we have always enjoyed with you.
Question: One of the areas we are focussing on right now is local property taxes. CARH has commissioned a study by the Iowa Public Policy Center for a state-by-state study of local property tax statutes for low income housing. We just embarked on this. We think there's some benefit. We wonder if within your tracking system you could provide us with a line item for property taxes by each state so we can see which states show up as having lower property taxes?
Answer: I'll have to look into that to see how we track. You're wanting to know by state or by individual project?
Follow up: We want to know which states have the lowest property taxes per unit. Our study will look at the statutes of all 50 states.
Question: Couple of questions about Rental Assistance. Can you give us a quick update on your plans for this Fiscal Year? Any plans for retiring RA? And in light of the overburdened tenants, does it make sense to retire RA?
Answer: Well, I'm only retiring RA because we have a budget number that we have to meet. We're going to squeeze by, by the skin of our teeth. We've just barely got it made with what we have. It's going to be a challenge soon with what the new numbers look like. We are hoping to maintain the increase in RA but the numbers are not looking that great, the way we see them now. The only way that we can make up the budget deficits, especially if we continue to build new with RA, is to retire it if it's not being used. We're not doing it because we want to.
There are a lot of things we probably need to be looking at. I certainly want to talk with HUD about minimum rents and how we might handle something like that. As much as I hate going into that environment, I think we may; we've come to that.
But even when we looked at it before, it wasn't a huge savings. It wasn't that great a cost savings. So if we do it, it's got to be cost effective. It's not where we want to go, but we're looking. We're going to have to get that number with every budget we get, that's what we're stuck with.
Question: If I understood your comments on retirement RA, you are retiring RA according to a budget number. The budget from Congress or an internal budget? What do you do with the RA you retire? At the same time, you're saying that overburdened families and elderly can use more RA, it's an inconsistency to then ask Congress for more units.
Answer: The budget constraints have necessitated that everyone gets a number they have to work with, such as everyone has to cut the budget 5%, or whatever it is. We have a budget number we have to get, so when we come up with a number we have to work with, that's the number we felt last year we could make in 2012. We don't want to reduce it any more. We have asked the Department, going into the future, to help us preserve what we have. The hope is that we keep what we have by not cutting programs. But the number that we would have right now from the House is a further reduction. Trying to make up $25 million of RA is huge. So we're not retiring RA because we want to.
So when we moved everything into MPR and decided not to do 515 this year, I know that's a huge bone of contention. Congress wasn't pleased; we are not confused. We were asked in previous years to try to streamline our programs. Because of you, we were going to have a fight; we were asked not to put any funds in MPR so we always funded 515. However, after year after year of Congress giving us money for MPR, it occurred to us that Congress wants us to have an MPR program. So we asked for MPR in light of the fact that we had production RA and every time we do a brand new 515, we have to put new RA in or it's not very feasible.
That's why this year we said: Let's focus on what we have. Let's preserve what we have, so we don't lose our portfolio. While it's great that we continue to build because there are areas that need it, we really need to take care of what we have. And so we were hoping that for the next year or two we didn't build new, that we just tried to preserve what we have and build up rehab through MPR, and that way we are not putting on new RA that may or may not get funded next year.
In the long run, that new project is just not going to make it without RA. I need a way to try to preserve what we already have. That's why we didn't put money into 515 this year and, instead, we do MPR. There are tools in MPR that I cannot use in 515. So while it's great that I can put my money into 515, there are certain tools in MPR that, if I try to do rehab as a straight 515, it just won't work.
It's not my intent to eliminate 515 forever. It's not just the RA, it's decreasing funding, and RA is a significant part, a big part.
Thank you.