Testimony of Jenny Reed, Policy Director, At the Public Hearing on the FY 2013 and FY 2014 Performance Oversight of the Department of Housing and Community Development

Chairman Bowser and members of the committee, thank you for the opportunity to testify today.  My name is Jenny Reed and I am the Policy Director at the DC Fiscal Policy Institute.  DCFPI engages in research and public education on the fiscal and economic health of the District of Columbia, with a particular emphasis on how policies impact low- and moderate-income families. 

I am here today to testify on the performance of the Department of Housing and Community Development over fiscal years 2013 and 2014 to date and want to focus on two of DHCD’s programs; First Right to Purchase, which helps low-income tenants purchase their building when it is put up for sale, and Inclusionary Zoning, which offers private developers density bonuses and in return requires private developments to include affordable housing set-asides.  DHCD has made or is in the process of making important improvements to both programs and deserves recognition for that progress.  However, there are still some areas where we believe that further improvements are needed.  

First Right Purchase 

DHCD’s First Right Purchase program is one of the District’s key anti-displacement tools and helps low- and moderate-income tenants exercise their right to purchase their building when it is put up for sale.  A DCFPI analysis found that First Right Purchase preserved nearly 1,400 units of affordable housing between FY 2002 and FY 2013, including buildings in all but two wards in DC (See Figure 1. A copy of the full report is attached).  Without the financial support and technical assistance provided by the First Right Purchase program, many low-income tenants would not be able to take advantage of this right. 

DCFPI’s analysis also identified several steps to improve the effectiveness of the tenant purchase program that I will highlight today. 

Helping Tenant Groups Access Funds Quickly:  First Right Purchase projects occur at all times throughout the year and are on tight timelines because of the legal requirements associated with the Tenant Purchase law.   This means that tenants need quick access to funds throughout the year and that the DHCD process to approve purchase proposals needs to be streamlined.

I am very glad that DHCD has been working to develop a program to provide quick access to acquisition and pre-development funds for tenant purchase projects, through Community Development Financial Institutions (CDFI’s).  DHCD has a similar program to help nonprofit housing developers access funds quickly ‘ the Site Acquisition Funding Initiative (SAFI) ‘ and is essentially looking to recreate it for tenant groups.  The program could be ready by the start of FY 2015.  We encourage the committee to follow this process to ensure that the new program is up and running as soon as possible.

To read the complete testimony, click here.