July/August 2006

Despite FY07 budget cuts, SAHA successfully advances its site-based management.
The President’s budget proposal for 2007 seeks to further slash funding despite the declining state of the nation’s housing stock and escalating modernization costs.

Decreasing funds make it extremely difficult for housing authorities to meet their goal of providing public housing that is an asset to the community, rather than a liability. 

Additionally, in March 2006, the Department of Housing and Urban Development (HUD) mandated that all authorities convert to a system known as "asset management" by October 1.  Also known as site-based management, this plan models how the private sector manages property by necessitating that each property (or grouping of properties) break even financially.

The decreased funding for public housing will require that public housing authorities adopt new strategies for generating profit.  Budget cuts, along with the new HUD mandate, have posed such a burden that many public housing authorities have taken drastic measures to conserve resources. 
  • The New York City Housing Authority intends to raise rents for thousands of residents living in public housing to compensate for the disparity in funding.  Without finding a solution to the problems posed by dwindling funds, the chairman of the authority predicts its resources will be depleted in 2 years.
  • The Chicago Housing Authority faces delays in the construction of their new public housing developments extending beyond the 10 years the construction was expected to take.
  • The Housing Authority of Portland and the Salt Lake City Housing Authority are selling hundreds of public housing rental properties to save money, thus reducing the affordable housing options that were once available to their communities.
  • in the housing authorities in Trenton,NJ; Camden, NJ, and Philadelphia expect to layoff hundreds of employees. 
  • The Passaic Housing Authority of New Jersey randomly terminated 385 Section 8 residences from their program through a lottery.

While many housing authorities have experienced difficulty with site-based management, SAHA has so far been successful at implementing this new management system.  On May 1, 2006, SAHA began converting sites to the new management system.  A week earlier, SAHA submitted site groupings to the Public and Indian Housing Information Center, all of which were approved by HUD on June 23, 2006.

Despite the fact that SAHA expects to be under-funded by about 20% next year, our organization is setting an example for positive adjustments to these changes by taking proactive steps to compensate for lack of funding.

SAHA has sought revenue streams including creative mixed-finance capital structures.  By establishing partnerships with for-profit developers and non-profit organizations, SAHA has aggressively worked to create affordable, market rate, and public housing units in apartments, townhouses, and single-family homes, with both homeownership and rental opportunities.  SAHA has also had great success in building new housing through the Low-Income Housing Tax Credits (LIHTC) program.


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