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Key Questions for the Next HUD Secretary

If confirmed, Rep. Marcia Fudge (D-OH) will become the 18th Secretary of the Department of Housing and Urban Development, a federal agency charged with creating strong, sustainable, inclusive communities and quality affordable homes for all Americans. Advancing this mission is central to the “four overlapping and compounding crises” the Biden administration has resolved to tackle—a pandemic that has claimed over 400,000 lives, the attendant economic downturn, climate change, and a national reckoning on racial equity and justice.

COVID-19 hit while the United States was already experiencing an acute shortage of affordable rental homes. The pandemic’s public health and economic impacts have only magnified and accelerated this crisis, hitting communities of color the hardest. While American families have proven remarkably resilient, and federal policymakers have responded with a range of policy interventions, the U.S. is far from achieving the aspirational national goal first articulated in the Housing Act of 1949: “a decent home and a suitable living environment for every American family.”

As the Senate Committee on Banking, Housing, and Urban Affairs considers the nomination of Marcia Fudge to be next HUD Secretary, the Bipartisan Policy Center offers the following questions:

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  1. Residents in federally assisted housing are lower income, more diverse, older, and more likely to have a disability than the general population. With a greater risk of COVID-19 transmission in these congregate settings and the prevalence of complicating health risk factors, how will HUD and its federal partners protect residents and support COVID-19 testing, surveillance, and vaccination in federally assisted, congregate housing?

  2. Pandemic-driven job and income losses have resulted in missed mortgage and rent payments, leading to rising housing-related debt and the continued threat of mass evictions and foreclosures. The administration’s proposed American Rescue Plan calls for significant new spending on emergency rental assistance and the extension of foreclosure and eviction moratoriums. However, as recently noted in a letter from housing stakeholders, that plan did not include direct assistance for struggling homeowners. Recognizing the danger that the current crisis poses, particularly to the minority homeowners who represent over half of the 3.4 million homeowners past due on their mortgages, how do you plan to help struggling borrowers navigate forbearance, exit with loss mitigation plans, and avoid foreclosure?

  3. Reports show that 1 in 10 FHA loans are seriously delinquent. Such a massive spike in mortgage delinquencies—to levels not seen since the housing crisis—poses significant operational and financial challenges for FHA. How will you preserve FHA’s financial strength so it can continue to serve creditworthy borrowers and protect taxpayers in the months to come?

  4. More broadly, FHA plays a critical role in our housing finance system, helping borrowers when the conventional market is unable to adequately serve them. Yet, as Republicans and Democrats alike have acknowledged, FHA faces enormous challenges in providing access to homeownership and counterbalancing a sometimes volatile housing market. The outsized role the government plays in housing also continues to be a bipartisan concern. What will you do to better equip the FHA to complement the conventional mortgage market, allow private capital to assume greater risk, and more effectively serve first-time and minority homebuyers?

  5. Ginnie Mae is also an enormously important player in our housing finance system, guaranteeing over $2 trillion in mortgage-backed securities (including those with FHA mortgage insurance) and operating a common securitization platform through which all Ginnie-Mae-guaranteed MBS are issued and administrative functions are performed. As such, various housing finance reform proposals over the years have envisioned an expanded role for Ginnie Mae, despite longstanding funding and hiring challenges that limit Ginnie Mae’s ability to carry out its core functions most effectively. What reforms would you seek to address these concerns? What role do you contemplate for Ginnie in a reformed housing finance system?

  6. Despite the “urban” in HUD’s name, its programs provide critical funding to communities of all sizes. Some of America’s most pressing housing issues fall well outside the jurisdictional lines of the largest metro areas. For example, the housing problems of Native Americans, including Alaska Natives, who reside in reservations and other tribal areas, are among the most dire—23% live in physically substandard housing compared with 5% of all U.S. households and 16% live in overcrowded housing compared to 2% of all U.S. households. How will you work collaboratively with federal partners, like the Departments of Agriculture and Veterans Affairs, to ensure that the highest priority housing needs are being met effectively and equitably in all of America’s diverse communities?

  7. Safe, healthy, and affordable housing is increasingly recognized as a key determinant of health. While there are many ongoing and productive partnerships between HUD and HHS at the nexus of health and housing, from preventing falls among older adults to remediating home health hazards like lead paint, better linking these two departments has the potential to improve health outcomes and reduce costs borne by the health care system. How will you prioritize interdepartmental collaboration, work with HHS Secretary-Designate Xavier Becerra to align programmatic and policy goals, and endeavor to realize the myriad benefits of investments in housing affordability?

  8. Every year millions of Americans’ lives are upended by increasingly catastrophic natural disasters. In fact, there were 22 weather and climate events in 2020 with losses exceeding $1 billion, resulting in the death of 262 people. Most tragic and frustrating is the fact that tens of billions of dollars that were appropriated to support communities in crisis are on the sidelines, bottled up in administrative processes at all levels of government and failing to help people in need. Given the importance of HUD’s Community Development Block Grant Disaster Recovery program as a source of long-term disaster recovery funding, what will you do to ensure these dollars flow to communities in crisis quickly, equitably, and impactfully? Do you support a permanent authorization of the CDBG-DR program to improve its administration?

  9. The Biden administration has committed to centering racial equity and justice in its policymaking, seeking to undo and address the historical harm caused to Black, Indigenous, and communities of color. Under your leadership, and to advance such an agenda, many expect HUD to reinstate Obama administration regulations such as the Affirmatively Furthering Fair Housing Rule and Disparate Impact Rule. Yet, as we have seen before, unilateral, administrative action lacks permanence. In any revisions to these rules, will you seek input from across the aisle and weigh genuine concerns about the rules’ complexity and compliance costs? Working with Congress, what other fair housing policies do you intend to pursue to advance racial equity and opportunity?

  10. The Trump administration recognized that land-use restrictions and other regulatory barriers reduce and delay development, increase constructure costs, and limit the supply of affordable homes. They launched an interagency council to assess and eliminate such barriers—the most recent in many efforts over the years, by both Democratic and Republican administrations, to identify and reduce restrictive zoning and unnecessary housing regulations. More recently, HUD published a final report laying out ways in which the federal government can encourage and support jurisdictions to increase housing supply across income levels. Will you continue this work and find new ways to break down barriers to affordable housing development?

  11. Helping Americans experiencing homelessness find a safe, stable home is at the very heart of HUD’s mission and has long been a bipartisan priority. Previous investments in a suite of cost-effective, evidence-based programs—including rapid re-housing, permanent supportive housing, and housing vouchers—are widely credited with steadily reducing homelessness until levels began rising in 2017. How will you use your office and platform to make effectively ending homelessness a national priority?