House trap 


It's easy to view Mel Martinez's appointment to head the U.S. Department of Housing and Urban Development (HUD) as a political payback. After all, as Orange County chairman, Martinez had gone out in front on the Elian Gonzales fiasco and had used his office to vigorously campaign for George W. Bush, who later handed him the cabinet position.

Martinez, one could argue, wasn't exactly the most qualified candidate to head a $30 billion bureaucracy charged with overseeing low-income housing. His experience was limited to a short, mid-1980s stint on the Orlando Housing Authority (OHA) board and his still-blossoming public service.

Still, his star was rising within the GOP ranks: His maverick plan to tie school capacity to growth made him a favorite with Dubya's brother, Gov. Jeb Bush, and his up-by-the-bootstraps story of immigrating from Cuba as a teen-ager was hard to beat. Moreover, he projected the kind of compassionate-conservative image the Bushites needed in light of the controversial John Ashcroft nomination. So, experience aside, the Senate unanimously approved him.

Now what? On April 5, to a slew of reporters and a gathering of the nation's mayors, Martinez made his very first budget request: a $2 billion, 6.7 percent increase over last year's budget. The mayors cheered, encouraged that the Bush administration didn't appear to be following the Republican trend of slicing and dicing the agency's budget.

Then they crunched the numbers -- and the cheering stopped.

"Although the budget looks like an increase," says Vytas Verger of the Washington, D.C.-based National Housing Law Project, "in real numbers, it's an actual decrease."

"I can tell you," says Stan Halbert, chairman of the OHA board, "the public-housing industry is not pleased at all with the proposed budget."

HUD's refocused budget, it appears, aims to bolster home ownership and faith-based programs while gutting $1 billion from low-income housing programs. And, Verger says, when the budget is adjusted for inflation and takes into account more than $2 billion in rental-subsidy contract renewals, the increase all but vanishes.



The biggest complaint, critics say, is the $700 million cut to the capital-improvement funds, which are used to repair dilapidated buildings. Martinez, in documents submitted to Congress, asserts that despite that 25 percent decrease, there's still enough money to meet public-housing needs.

"This is simply due to the fact that there's a surplus of unobligated funds," Martinez told the mayors. "There will be no roof that will go unrepaired, and there will be no modernization that will not take place ... because of this cut."

Not true, public-housing directors and advocates say. If these cuts had taken place a few years ago, Halbert says, OHA's 1,700 units might be toughing out 90-degree summers without air conditioning.

For Jerome Ryans, director of the Tampa Housing Authority, the cuts will mean long delays in basic renovations. More than that, though, the HUD cuts undermine housing authorities' attempts to float bonds. After all, if you were an investor, would you be confident HUD would repay you?

"It's going to affect what we do," he says. "`Projects` may take us eight or nine years."

"It could also mean," Verger adds, "that you're a lot more particular on what you repair. Emergencies `go` up front, `but` other things that are just as important" -- like repaintings and roof repair -- "those kinds of things are going to be put behind."

Specifically, says OHA director Vivian Bryant, there's no way to be sure about the impact. For starters, capital-improvement cuts would affect programs slated about three years down the line, and OHA may be able to make up the funds through its operation budget or through Community Development Block Grants (CDBG), which HUD gives to counties to redevelop blighted areas.

Moreover, the budget cuts come at a national level. From there, the money is either awarded to local governments, housing authorities or private agencies through bids or HUD's complicated formula. So while the total dollar amount may decrease, Bryant says, OHA's funding -- part of the $1.18 billion HUD allocated for Florida -- might not.



Orange County, which receives around $6 million in CDBGs and $1 million for a home-ownership investment program, isn't worried.

"It's been really consistent for the entitlement program," says county planner Mitch Glasser. "Those programs aren't being cut -- just public housing. These programs have congressional support because the money is going into `representatives'` districts. The other money is going to agencies."

Though gutting public housing is politically easy -- after all, the poor minorities who live in these projects aren't likely to vote -- the programs really should be expanding. Orlando's public-housing agency, like most, has a waiting list in the hundreds.

"There's a tremendous unmet need," Halbert says. With Section 8 rental vouchers for public housing, OHA provides almost 4,000 dwelling units to the underprivileged, though the Orlando agency is dwarfed by those in Tampa, Miami-Dade and Jacksonville.

"Central Florida," he points out, "is a service-based economy. We don't have a high median income."

The capital-improvement program isn't the only one getting the ax. HUD's Drug Elimination Program, which provides funds for drug-prevention programs and to hire off-duty police officers, will be completely wiped out by 2003. Because the officers are hired on an as-needed basis, Bryant couldn't say how much DEP money OHA spends annually. Though housing-authority officials say it's a huge help in cleaning up troubled neighborhoods, Martinez contends that it duplicates existing programs.



During a Senate hearing on the budget, Verger says, Martinez didn't seem to understand that capital funds are not used every year. Since construction projects don't happen overnight, Congress usually allocates capital improvement monies in three- or four-year blocks. As for Martinez's assertion that the cuts are due to unspent funds, Halbert says, that happens only in a few of the country's poorly run agencies -- and it's unfair to punish the rest for their misdeeds.

But most people don't blame Martinez for the plan's flaws. "We think his heart is in the right place," Halbert says. "We think this budget has been handed to him `by the Bush administration`."

"Frankly," adds THA's Ryans, "I like him. We have to give him the opportunity to do his job. I suspect that budget was already there."

Perhaps he is carrying the administration's water. But if the goals are misguided, shouldn't Martinez -- who achieved popularity in Central Florida by bucking his core conservative backers when the situation called for it -- tell it like it is?

Advocates say the focus on home ownership, though worthwhile, shouldn't detract from the needs of the public-housing programs. "While it's nice to focus on homeownership," Glasser says, "there still is this segment of the population that can not only not afford a home, but can't afford to rent, either."

Then again, Ryans has learned to cope. "When it comes down to money," he says, "we always come up short. I've gotten use to this kind of thing."

And, Halbert adds, HUD is giving more autonomy to "high-performing" housing agencies like his, allowing them to do their job without the red tape.

With Martinez at the helm, Ryans concludes, HUD may get better: "I think that secretary is willing to listen to what we have to say. I think he's going to be one of the best secretaries ever."


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