WASHINGTON - Boosting homeownership tops President Bush's housing
agenda, but the biggest battle facing his administration during the second
term is how to overhaul a program that helps 2 million poor families pay
their rent.
Besides making changes to that program, Bush wants a new tax credit for
builders that he thinks could increase affordable housing for middle-income
families by at least 40,000 units a year.
The president also wants to reduce local and state regulations that discourage
developers from putting up affordable housing. A separate proposal would
create zero down-payment loans for first-time buyers whose mortgages are
guaranteed by the Federal Housing Administration.
Successes could help Bush reach the goal, which he set in his first term,
of 5.5 million new minority homeowners by decade's end. The Housing and
Urban Development Department said about 1.9 million have been added so
far.
Since Bush took office in 2001, the percentage of U.S. homes that are owned
has grown from 67.5 percent to 69 percent today. Democrats contend that
record-low interest rates during the period were the main reason; the
president has said his tax relief programs provided a big boost, too.
Bush is expected to try again to have Congress enact the major changes he
wants to the $14.5 billion Section 8 voucher program, which is about half
of the department's total budget. That is up from one-third in 1998.
Housing authorities get a set number of vouchers every year for helping
families cover the rent, so there is little incentive for local officials
to manage their program efficiently, HUD Secretary Alphonso Jackson
has said. Washington bureaucrats play too large a role in an issue that
state and city officials can better manage, he says.
He gives some examples: One local agency may not be able to fill all the
voucher slots it has because not enough people qualify for help; a second
agency may not know it is giving vouchers to families that no longer
qualify because their income has risen since they signed up.
Bush's 2005 proposal called for the program to be based on dollar amounts
rather than on a fixed number of vouchers. The plan allows local agencies
to shape the program to their specific needs but add incentives to ensure
that money is used efficiently, the government says.
Opponents contend voucher recipients now would not be guaranteed to keep
their assistance if Bush's changes pass. They also claim local agencies
would not have to ensure that vouchers go the poorest applicants.
Sunia Zaterman, executive director of the Council for Large Public
Housing Authorities, agrees that changes are needed, but says HUD is
unwilling to spend the money necessary. She and other advocates say the
2005 Section 8 budget falls $1.6 billion short of what is needed.
In past years, Congress and Bush also encouraged local agencies to use as
many vouchers as possible and to make available to voucher recipients more
housing in middle-income neighborhoods, resulting in higher costs now, the
Public Housing Authorities Directors Association contends.
"The term that we are using is that the budget situation is bleak," said
Tim Kaiser, the group's executive director.
Some of the other housing issues include:
HUD's wish to move quickly on a proposal to create opportunity zones that
would give struggling urban and rural communities priority in receiving
federal help for housing, education and job training.
Renewed efforts by Bush and congressional Republicans to tighten oversight
of mortgage companies Fannie Mae and Freddie Mac, both of which have
experienced accounting scandals.
The department's pursuit again of changes in procedures governing real
estate settlements and closing costs.
IF YOU'RE INTERESTED
White House homeownership agenda:
http://www.whitehouse.gov/infocus/homeownership/.
