Homeowner Flood Insurance Affordability Act of 2013 -- Motion To Proceed

Floor Speech

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I ask unanimous consent that the letters I will be speaking about be printed in the Record at the end of my remarks.

Recently the Obama administration has been talking a lot about income inequality and poverty. Yesterday I spoke about the issue, about the war on poverty, its successes and its failures. As I said yesterday, the United States has spent trillions of dollars in the last 50 years fighting the so-called war on poverty. I said yesterday that the results have been marginal, in some cases successful, reducing the poverty rate from 19 percent down to the 15 percent it is now. But a lot more needs to be done.

Now, in the fight against the war on poverty, this administration, like a lot of administrations, wants to spend more money on more programs. Some of that may be justified, but that does not seem to fix the problems. If you just hand this money out with no strings and no oversight, it gets diverted and misused. That is the purpose of my speaking today on the subject of public housing.

Wasted money does not help the poor. There are a lot of people who make a nice profit from the poverty of others. This administration has been helping a number of these profiteers while the poor suffer. I want to be clear as to some of these issues I am talking about--their genesis goes back to previous administrations as well. Through my oversight work, I have seen this happen over and over, that a few people profit from trying to help the poor, but the money does not go there. The Department of Housing and Urban Development hands out $4 billion in Federal money every year to local housing authorities. This money is supposed to help provide clean, affordable, safe housing for the poor. But, while no one is watching, much of the money gets spent on high salaries and perks for the people who run the housing authorities. These housing authorities have other sources of money. For most of them, up to 90 percent of their total funding comes from the $4 billion contributed by the Federal taxpayers.

Housing and Urban Development argues that because housing authorities are State and local government entities, there is no reason to scrutinize them from here in Washington, DC. As far as I am concerned, HUD is missing the point for 4 billion reasons. Those are dollar reasons. Taxpayer money should come with Federal oversight. We need to make sure that the Federal authorities who disburse it make sure they oversee that it is spent in the legal way--to help the people who need the help.

I have been conducting oversight of the wasteful spending at housing authorities for almost 4 years. I have been urging the Obama administration to look at what is happening and to take action. But there is little if any interest in the oversight of these Federal dollars by the folks writing the checks here in Washington, DC. They just want to send the checks and pat themselves on the back. They do not want to talk about what actually happens to the money once it is disbursed.

Federal funds end up feathering the nests of local housing bureaucrats instead of housing the poor. I will show you how that is done. Here are some of the most egregious examples of how ineffective the Department of Housing and Urban Development has been at policing local housing authorities.

Bradenton, FL, is an area of the country which was hit extremely hard during the foreclosure crisis, but employees at Bradenton Housing Authority only have to work 4 days a week. They get 2 weeks off at Christmas, bonuses in June and December, and the option to cash out up to a month of sick leave twice per year. They get free use of a car purchased by the housing authority. After 15 years of employment, they get to keep the car when they leave or take $10,000 instead; it is their choice.

There are generous fringe benefits, but many housing authorities also provide very lucrative salaries. These salaries far exceed the salaries of Federal employees right here in Washington, DC, who hand out the taxpayers' money to the housing authorities. The biggest salary jackpot winner I have encountered so far is the Atlanta Housing Authority. At least 22 employees there earn between $150,000 and $303,000 per year. The Atlanta Housing Authority benefits from a special HUD designation called ``moving to work.'' That program exempts designated housing authorities from certain requirements, including salary justification. This is not just an isolated example. The executive director of the Raleigh, NC, housing authority receives about $280,000 in salary and benefits, plus up to 30 vacation days. He also accumulates comp time for any hours he works over 7 1/2 hours per day. He has used over 20 days of comp time per year since 2009. Add that to his regular vacation time, and he is out of the office nearly 3 months per year. Nine months of work for $280,000 is an annualized salary of $375,000 per year. Very few taxpayer-funded jobs pay anything close to that amount.

So what is the justification for such high salaries, particularly considering the fact that they are supposed to provide safe, affordable housing for low-income people? After years of ignoring the issue, HUD finally capped Federal funding for executive salaries at $155,500 per employee. Of course, this was only after various local media and I exposed deep-rooted problems and pushed the Department of Housing and Urban Development to act. But now housing authority executives have turned to creative accounting tricks to get around that limit of $155,500 per employee. Since some of their money comes from other sources, the housing authorities simply claim that any salary over the Federal limit comes from one of those other sources, whereas the money from those other sources ought to be used to help low-income people have affordable, clean, and safe housing.

Because of my oversight letters on this subject, HUD recently notified the housing authorities that they must document the original source of the funding used to pay salaries over the Federal limit. That is good news, but there are still larger problems. The Department is still not making this salary data public in a reasonable timeframe. I will give an example. This administration refused to release the 2010 set of data for almost a year. I hope we do not have to wait a year to get the most recent data.

Like many of our Federal agencies, some housing authorities spend large amounts of money on travel for conferences and training. Some of that may be legitimate, but I am raising questions about the extent to which it is done and the amount of money that is consumed. Staff and board members often attend the same conferences throughout the United States year after year. They often attend multiple conferences in a single year. In addition to travel costs, housing authorities must pay a conference fee for each attendee they send, often ranging from $400 at the low end to $1,000 per employee at the higher end.

That money could easily be used to improve conditions and make needed repairs in public housing facilities. Instead, it is frittered away on conferences. In other words, forget the low-income people they are supposed to be helping and spend the money someplace else.

The Tampa Housing Authority has spent more than $860,000 since 2009 for staff and board members to attend various conferences, seminars, and training programs--$860,000 that could have been used to provide affordable housing for low-income people. Tampa also has been sending 20 or more employees per year to conferences sponsored by the National Association of Housing and Redevelopment Officials. That alone costs more than $177,000 per year.

The Atlanta Housing Authority spent more than $480,000 since 2009 for the employees to attend conferences and training sessions. In fact, the housing authority paid over $68,000 in conference fees to a software company after giving them a multimillion-dollar contract for a new computer system.

I wonder--I don't know, but I think it is legitimate to question--if the housing authority executive director thought to ask for a discount. Many of the housing authorities with questionable spending don't limit the abuses to salaries or travel.

The Tampa Housing Authority purchased a new $7 million administrative office that includes nearly $3 million in renovations and upgrades. That could have helped hundreds, if not thousands, of poor people needing the housing. They are also paying nearly $800,000 in salary and benefits for a public relations department while at the same time paying an employee another $170,369 as a PR consultant.

Other housing authorities are also spending exorbitant amounts for outside consultants. Some of these consultants are former employees of the local housing authority.

In 2013, the Pittsburgh Housing Authority retained 10 law firms for a total of $3.5 million over 3 years. One law firm has been representing the housing authority during inquiries by the Department of Housing and Urban Development Office of Inspector General and the city controller.

Think about that. It is bad enough that taxpayers' money meant to help the poor is wasted, but when the taxpayer also pays the lawyers to defend the very organization from scrutiny about whether the taxpayers' money was wasted is even more outrageous. Of course, that adds insult to injury.

In Philadelphia, outside lawyers blocked the inspector general's office from assessing spending data for months, and that cost the taxpayers millions of dollars.

The Pittsburgh Housing Authority also paid an outside consulting firm $1.25 million in the year 2012. The vice president at the consulting company billed the housing authority $404,000 for 2,400 hours of work. That is 48 hours a week for a year. It is more than double the $168,000 salary of the housing authority executive director.

Harris County, TX, is one of the most egregious examples of out-of-control spending. In 2013, the HUD inspector general questioned the mismanagement of over $27 million in Federal funding for Harris County. The IG provided the following examples of fraud and abuse: over $1.7 million in excessive payroll expenses; $190,000 for statues and monuments; $66,000 for employees' shirts embossed with logos; $27,000 for trophies, plaques, and awards; $14,500 for a helicopter, a chartered bus, and golf cart rentals for a grand opening; and $18,000 for letters written by Abraham Lincoln.

I continue to send my oversight letters to the Senate appropriators and the Senate banking committee. These are the letters I received permission to put in the Record at the end of my statement.

The Senate appropriators and the Senate banking committee members have jurisdiction over the Department of Housing and Urban Development. They have the authority to do something about these abuses. My colleagues need to know the extent of the problems, and that I am ready to work with the Members of this body to address these issues.

Employment at public housing authorities should be about public service. That is why we have a program serving the needs of low-income people. It is supposed to be providing clean, safe, affordable housing for those in need, not helping bureaucrats live high on the hog on the taxpayers' dime.

As I said in my opening, this problem didn't start with this administration. There is a culture here that had to start back a long time ago. But now, bringing these problems to the attention of this administration, I hope it will take them seriously. If this administration is truly serious about income inequality--and not only using it for political purposes--it would stop shoveling taxpayers' money out the door with practically no oversight, no controls, no limits, and the waste of money I have just expressed. If President Obama is truly serious about income inequality, he would take the money high-income public housing authorities waste and give it to the benefit of low-income patrons of public housing to provide what the law is meant to provide these people: safe, affordable, healthy housing.

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