Thank you, Governor Corzine -- for that introduction and for your extraordinary leadership and partnership. I also want to say a word of thanks to Acting Commissioner Richman, who is doing remarkable work.
It's a pleasure to be here in Atlantic City with so many of our partners -- from developers and non-profits, to housing advocates and representatives in government.
Each of you reminds us that whatever we achieve, we achieve together -- through partnership and leadership.
Indeed, that is precisely what it took to build or preserve 30,000 affordable housing units over the last three-and-a-half years as Governor Corzine just announced.
I think Governor Corzine--and all of you--deserve a round of applause. [PAUSE]
Today, I'd like to discuss how we can draw upon that effort to build the strong, inclusive sustainable communities New Jersey and America need to succeed in the 21st century -- what we're doing both in Washington and on the ground here in this state to build on the remarkable work you are already doing to prepare for the challenges ahead.
To be sure, whether you are in New Jersey or Washington, the challenge is the same:
How we can meet the needs of today without compromising the futures of our children and grandchildren.
That is what we mean when say "sustainable communities."
And New Jersey has a special set of opportunities to deal with these challenges -- from a highly suburban and developed geography to the most extensive statewide rail system in the country. Indeed, in the ARC Tunnel, New Jersey is poised to make the single largest federal transit investment in history -- providing 60 municipalities with direct access to New York City.
But with these unique opportunities come unique challenges -- chief among them, the need to preserve affordable housing.
Indeed, with the reforms that the Governor signed into law last summer to build more affordable housing near transit, New Jersey has proven to be ahead of the curve when it comes to balancing the demand for housing around transportation with the need to keep that housing affordable for the families who need it most.
And of course, foreclosures are one of our biggest challenges. Yesterday, I testified before the Banking Subcommittee on Housing, Transportation, and Community Development, chaired by Senator Menendez, to discuss our progress and the road ahead.
So, today, I'd like to take a few moments to talk about not only how we are pushing back on the foreclosure crisis, but how we are using this unique moment, just as Governor Corzine has here in New Jersey, to lay the groundwork for the sustainable future that ensures this kind of crisis never happens again.
A Unique Moment
But to understand where we're headed, we need to understand where we were -- and only a few short months ago.
It wasn't that long ago that uncertainty was rampant. The U.S. economy was in a nosedive. Banks were in crisis and credit was frozen solid.
By the end last year, a staggering $10 trillion in household wealth had been lost. In January, over 740,000 Americans lost their jobs, the worst decline since 1949.
Foreclosures were at record levels, consumer confidence fell to a forty year low in February, and new home sales were falling more than 10 percent a month.
Serious commentators from across the political spectrum warned that we were witnessing the beginning of a second Great Depression.
That was the situation we faced.
But starting with President Obama's inauguration, we hit the ground running. First, the Administration put in place a Financial Stability Plan to help restore confidence in our financial markets, ensure banks have adequate capital, and encourage the flow of credit into the economy.
Second, we passed the Recovery Act and pumped nearly $800 billion into communities across the country -- providing tax cuts and aid for our recovery, while laying a new foundation to make America competitive in the 21st century economy.
And third, we unveiled the President's Making Home Affordable Plan -- an aggressive effort to stabilize the housing market and help millions of Americans stay in their homes.
Making Home Affordable
For states like New Jersey, where the foreclosure crisis has hit hard, help arrived not a moment too soon.
Certainly, New Jersey has done everything in its power to address the foreclosure crisis here on the ground.
From your Judiciary Foreclosure Mediation Program, to your moratorium on foreclosures that you wisely coupled with funding for legal services for at-risk families, these efforts remind us that leadership at the top is critical.
At the same time, the New Jersey Homeownership Security Act reminds us only when Federal and state government share the same priorities can we not only crack down on predatory lending -- but put an end to the type of behavior that got us into this crisis in the first place.
And with President Obama's proposed Consumer Financial Protection Agency in place, we will.
Indeed, the Administration has taken a comprehensive approach to stabilizing and strengthening our housing markets. As a result, interest rates have hovered around or below 5 percent for six months -- allowing first-time homebuyers to enter the market and helping more than 2.9 million homeowners refinance, putting as much as $10 billion of purchasing power in the hands of American households.
Since the program's launch in March, nearly 1.8 million homeowners have received information about Making Home Affordable. Over 360,000 modifications are underway.
At the current pace, we expect the program will modify more than a half million loans by November 1st.
Now, we still have a lot more to do for New Jersey families.
That's why HUD is mobilizing its vast network of counselors -- to ensure that the families who need help get help. And here in New Jersey, you are, with efforts like the Newark-Essex Foreclosure Task Force.
That's why we've put pressure on servicers to ramp up their efforts -- holding them to higher performance standards and issuing a publicly available scorecard that lets the American people know what kind of progress their servicers are making.
And that's one big reason why President Obama is working to reform our nation's health care system. With health care costs the leading cause of personal bankruptcies--with almost half of all foreclosures caused in part by financial issues stemming from medical costs--reform is absolutely essential to making sure these modifications stick.
Taken together, while we're not out of the woods, with the weekly pace of trial modifications now exceeding the weekly pace of completed foreclosures, there is no question that we are beginning to move in the right direction.
And with sales of existing and new homes increasing for five consecutive months, homebuyer confidence on the rise, and home price declines slowing--and in some regions actually increasing--we believe we've reached a turning point in our modification efforts.
A Sustainable Recovery
Having said all that, given the recession, we know that many foreclosures are now being driven by job losses -- and that's where the Recovery Act comes in.
Pumping more than $6 billion into New Jersey communities--including $311 million from HUD--the Recovery Act has been critical to preserving and creating the jobs families need to stay current on their mortgages and in their homes.
In February, HUD started investing nearly $14 billion under the Recovery Act in our communities -- three quarters of which, I'm proud to say, we allocated in the first week.
But I'm even prouder to announce today in Atlantic City that we have obligated over $10 billion of our Recovery funds -- nearly three quarters of HUD's total Recovery funds.
That means that these funds are now available to communities across the country and are being put to work as we speak -- creating jobs where they are needed most, making homes more energy efficient and strengthening neighborhoods.
But the impact of the Recovery Act can't be measured solely in the sum of the dollars we've committed -- but rather in how they're being spent.
With the Housing and Economic Recovery Act of 2008, we have already invested $4 billion in the Neighborhood Stabilization Program to help communities purchase and convert foreclosed and abandoned properties into new affordable housing, or other options, such as land banks, that preserve neighborhoods.
Here again, when it comes to innovations and partnership at the local level, New Jersey has been a leader. With their "Operation Neighborhood Recovery," HANDS Inc. and the Community Asset Preservation Corporation have been pioneers in purchasing foreclosures in the Greater Newark area and redeveloping them as affordable housing.
This spring, "Operation Neighborhood Recovery" bought 47 foreclosed properties alone--the single largest non-profit acquisition of its kind in the country--with the goal of redeveloping 900 properties over the next eight years.
With the competition for an additional $2 billion of NSP funds included in the Recovery Act now underway, we can encourage those kinds of efforts, challenging communities to develop their own innovative ways to improve affordable housing, rebuild communities, and increase energy efficiency.
Indeed, nearly a third of HUD's $14 billion in Recovery Act funds can be used for "greening" America's public and assisted housing stock -- reducing energy costs, lowering greenhouse gas emissions and creating jobs.
And of the $4 billion that we've invested through the Recovery Act in our nation's public housing, we've set aside $1 billion for the Capital Fund competitive grant program -- to lay the groundwork for public housing and its residents to play a key role in the creation of sustainable communities.
Perhaps most important of all to New Jersey, we've also approved the final round of funding plans submitted by state housing finance agencies under the Tax Credit Assistance Program -- bringing the total amount of funding now at work under this program to $2.25 billion.
For the past two decades, the Low Income Housing Tax Credit has been central to affordable housing production here in New Jersey and across the country -- helping investors provide developers with the capital they need to build affordable rental housing for moderate and low-income families.
But as you know, the current economic crisis has frozen the investments states were able to make through the Low Income Housing Tax Credit program.
Thanks to the Recovery Act's Tax Credit Assistance Program--and to the staff at the New Jersey Housing and Mortgage Finance Agency, who have done a great job rapidly implementing this new program--funds are beginning to flow again.
To Village at Woodstown, where TCAP is helping finish 60 units of affordable housing.
To Galloway's Seashore Gardens, where it is helping build 58 new units of affordable housing.
To Franklin Township's Parkside Senior Housing -- which is part of a broader revitalization effort.
Across the state -- tax-credit financed projects that were stuck in the pipeline are moving forward again.
Altogether, TCAP funds will complete construction on an estimated 35,000 units of affordable housing nationwide, creating or preserving tens of thousands of jobs along the way, and building the more sustainable future we all envision.
Indeed, in communities like Medford, Elizabeth and New Brunswick, you're seeing how TCAP is helping convert brownfields--already developed land that has gone virtually unused for decades in some cases--into the affordable housing our communities desperately need.
There are properties across the country with good access to transportation and jobs that could be developed into affordable housing but aren't -- not because they can't be, but because the federal red tape to clean them up is such a disincentive.
Just last week HUD made changes to FHA's "MAP Guide" to make that process easier. That's "HUD speak" for employing state-of-the-art environmental protection technologies and techniques, to ensure that communities can "recycle" land and use it to develop safe, affordable multifamily housing.
I'm also proud to announce today that New Jersey will be receiving $24.5 million in Community Planning and Development grants -- building the capacity of this state's communities to develop and support strong neighborhoods.
But at a moment when the Recovery Act and various initiatives are putting the brakes on the recession, the time has come to think differently -- to recognize change comes from the community level and often through partnership.
Too often in the past, government has been a barrier to local innovations -- because they're often more focused on programs and policies than the people and places they're supposed to help.
But at HUD, and across the Administration, that is starting to change.
Nowhere is that change more visible than in our FY 2010 budget proposal, which we call the "Roadmap to Transformation" -- not just for HUD, but for the communities across the country that rely on us. It makes sustainability the very focus of everything we do.
That's nothing new to New Jersey. Collingswood undertook a comprehensive revitalization of its downtown to bring in business. Now, it is starting on an infill housing development with a wide range of housing choices on a train station parking lot -- transforming a neglected city center into a community anchor.
The town of Red Bank recently rezoned the area around its train station to promote inclusive development. A few blocks away, in a historic African American neighborhood, the community is working in partnership with a local church to build 36 affordable for-sale homes.
The latter was made possible because of New Jersey's Balanced Housing program -- run by your Department of Community Affairs--and I know many of you are here today--and championed by Governor Corzine who has a true appreciation for the need to balance transportation innovations with housing preservation and affordability.
As New Jersey's "Live Near Your Work" program demonstrates so clearly, for any community to succeed, it's absolutely critical that the people upon whom that community depends--who teach at our schools, police our streets and keep our small businesses strong--can themselves afford to live in the communities they serve.
To ensure these kinds of efforts are a success--and to identify and nurture similar innovations across the country--we're proposing to create an Office of Sustainable Housing and Communities.
We see this office at the center point of all of HUD's sustainability initiatives -- providing technical and policy support for energy, green building, and integrated housing and transportation programs at HUD and around the nation, and managing our relationships with the Departments of Transportation, Energy, and EPA at the federal level.
This holistic approach to community development--recognizing the links between housing, transportation, education and health care--is at the core of HUD's $150 million Sustainable Communities Initiative to better coordinate governmental efforts and build the stronger, more livable and inclusive communities America needs to respond to challenges of the 21st century, bringing some of the best ideas developed at the local level to the national stage.
Of those funds, we've proposed to set aside $40 million for a set of "Challenge Grants" that DOT and EPA will help us select. These grants would reward the kind of metropolitan partnerships we're already seeing in New Jersey that combine land use, housing, economic development and transportation programs to develop more sustainable communities -- rewarding innovation, integration, and collaboration all at the same time.
In our Sustainable Communities Partnership with DOT and EPA, we have already identified a series of policies and regulatory reforms that local leaders have told us are essential to realizing our shared vision.
For instance, we all want "affordable housing" -- but how affordable can housing be if you have to drive dozens of miles and spend hours in traffic to get to work every day? HUD and DOT are preparing to go program by program and create an "affordability index" that answers that very question -- so that when we build affordable housing, it's actually affordable for the families that live there.
Our Choice Neighborhoods Initiative, too, is motivated by the idea that "sustainable" doesn't just mean environmentally sustainable -- that for safe, affordable housing to be truly sustainable, it needs access to good schools, child care, health care, public transportation, and retail businesses that are the staples of every vibrant community.
More than doubling the funding under HOPE VI to $250 million, Choice Neighborhoods will extend neighborhood transformation efforts beyond public housing, broadening the range of activities eligible for funding and linking housing interventions more closely with school reform and early childhood innovations.
When it comes to supporting innovation at the local level--whether it is housing, environmental, education, or transportation--it's time the Federal government spoke with one voice.
The Geography of Opportunity
For me, Governor Corzine, and for President Obama, it all comes down to a very simple belief:
That when you choose a home, you don't just choose a home.
You also choose schools for your children and transportation to work.
You choose a community -- and the choices available in that community.
A belief that our futures should never be determined--or our choices limited--by our zip code.
Like our President, I know change is never easy -- that revitalizing our nation's communities won't happen overnight. Nor will it happen because of any one policy or the work of any one agency.
But working together, in common purpose--in partnership--we can tackle our toughest challenges.
We can push back on this crisis.
We can build upon the remarkable change and sense of possibility you're catalyzing in communities across the state.
And most important of all, we can create a geography of opportunity for every American.
Ensuring we do is our goal today. Let us rise to meet it. Thank you.