Julián Castro wants to lift the cap on the Rental Assistance Demonstration (RAD) program.
Three months into his job as secretary of the Department of Housing and Urban Development (HUD), he cites RAD’s expansion as one of his policy priorities going into the new year. The program, which was established in 2011, is the centerpiece of the agency’s affordable housing preservation platform.
“I’m convinced that if we can get that cap extended we can get a lot more units renovated out there so they are suitable for families to live in across the United States,” says Castro.
He took the reins of HUD from Shaun Donovan, who became director of the Office of Management and Budget. Castro lacks the extensive affordable housing experience that Donovan brought to HUD. Instead, he comes to the job after serving as mayor of San Antonio, a city that recently earned a Choice Neighborhoods grant from HUD and is one of the first taking part in the new Promise Zone Initiative that aims to create better neighborhoods.
In nominating Castro for the post, President Obama cited his leadership in revitalizing San Antonio and planning thousands of new housing units in the city’s downtown.
Castro, 40, talks with Affordable Housing Finance about his priorities, the HUD program he had the most experience with as mayor, and speculation that he’ll be tapped for a higher office.
What’s mission No. 1 for you and HUD?
Mission No. 1 is ensuring that as many Americans as possible have safe, decent, quality affordable housing. About 85 percent of our budget goes to essentially keeping a roof over Americans’ heads through everything from our housing choice vouchers to our project-based rental assistance to our public housing efforts. Our No. 1 priority is to use our resources prudently and effectively so that more Americans have a decent, safe place to live.
On top of that, we have other very pressing priorities. One of those is ending homelessness. The president has set a goal through his Opening Doors initiative of effectively ending homelessness by 2020. We’re well on our way, especially on veteran homelessness. Last week, we released the latest point-in-count that showed significant reduction over the last four years in veteran homelessness.
I’ll mention one other priority, which is to help build stronger communities whether that’s cities, rural areas, or tribal communities. We’ve done this through especially our place-based work like our Promise Zone effort, our Strong Cities, Strong Communities, and our traditional programs like Community Development Block Grants (CDBGs) and HOME.
You recently spoke at the Bipartisan Policy Center. Piggybacking on that, what’s one or two big policy issues that you hope to address in 2015?
One of the top ones is the issue of access to credit. We’re looking at what we can do to work with lenders at the Federal Housing Administration (FHA) to create a good environment so that more folks who are ready and responsible can get a home loan. In the Bipartisan Policy Center speech, I said it used to be pretty easy to get a home loan. Today, it’s too hard. We’re trying to ensure that that pendulum is not too far in either direction but there’s a good balance right in the middle—we have the right checks and balances in place to ensure we don’t go backward to the bubble but also that folks of modest means and first-time home buyers, people who are responsible, can get a home loan. That’s one of the biggest policy priorities going into 2015.
Another policy priority is to expand RAD. We have a statutory cap of 60,000 units of public housing that can be converted through RAD. We’re trying to get that cap extended to 180,000 units. I’m convinced that if we can get that cap extended, we can get a lot more units renovated out there so they are suitable for families to live in across the United States.
You mentioned the FHA when it comes to single-family housing. What about the FHA on the multifamily lending side?
Our multifamily lending has been a brighter spot over the last few years. We’re interested in maintaining strong relationships with the industry and ensuring that Americans can have a good choice in terms of single-family or multifamily.
Why is it important to you that both the single-family market is healthy as well as the rental market? You talk a lot about getting people into homes, buying homes, and making credit available for them. Why are both sides of the equation important?
The rental market is just as important as the single-family ownership market because for many folks the rental market is their starting point. Even for families that are well established, they are renters and we want to ensure that there’s affordability there. I also know that whether it’s single-family or multifamily that housing is a tremendous platform for other opportunities in life—better educational opportunity, better job prospects. I see HUD’s role as helping to spark greater opportunity in people’s lives whether they’re a renter or an owner.
As a former mayor, you saw many HUD programs in action. What program was the most valuable and why?
That’s a tough question because all of them are very valuable. The way I would put it is the one that I worked most directly with as mayor—CDBG. CDBG is 40 years old, created in 1974, and over the years its flexibility for local communities has allowed it to mean greater infrastructure investment, more people that are able to get into homes, financing that has been leveraged to create multifamily units. CDBG has been a very effective all-purpose player building up local communities. As mayor, it was the HUD program that I interacted with the most.
The issue is ensuring funding for it each year.
That’s always the challenge on CDBG and HOME to maintain an adequate level of funding.
As mayor, what did you see that needed to be changed at HUD?
I really didn’t have a vantage point from that perspective as mayor the way that I do now. What I will say is that as HUD secretary I’m doing everything that I can to strengthen our relationships with local communities. That’s one of the reasons that we’ve visited 19 cities. I’m going to be visiting a lot more. We’re soliciting feedback from our staff in our field offices. We want to enhance the place-based work that we do into a place-based approach that encourages collaboration across silos at the local level.
In San Antonio, we got together our housing authority with our community college, our electric utility, our transit agency, our big school district to work together to lift up the quality of life in neighborhoods. That’s what we’re encouraging folks to do at the local level.
Your mother worked for the San Antonio Housing Authority at one time. How old were you when she was with the authority, and what did she pass along to you?
She was there I believe from 1992 to 2000, the years my brother and I were in college and law school. Every now and then I had the opportunity to visit with some of the public housing residents. What struck me the most from that time was fully understanding that whether someone is from modest means or of great wealth, their aspirations are the same. If we do our job and they work hard that we can create a great opportunity for them to succeed. More than anything else I take with me the occasionally conversations I had back then.
There’s been speculation that this is going to be a job that leads to something else for you. Where do you see this job leading? People have mentioned you and your brother (Rep. Joaquin Castro) both as vice presidential candidates.
I’m convinced the best way to approach things is to just do a great job with what’s in front of you. I’ve only been on the job three months. I’m just trying to do a great job here at HUD, and then wherever that leads in the future so be it.
Connect with Donna Kimura, deputy editor of Affordable Housing Finance, on Twitter @DKimura_AHF.