The Importance of CDBG to Rural Families - Executive Director of Kentucky Mountain Housing Development Corporation Speaks at U.S. House of Representives Briefing
Statement by Donna Harris
Executive Director
Kentucky Mountain Housing Development Corporation
Briefing for
U. S. House of Representatives
April 11, 2005
Thank you for giving me the opportunity to appear at this briefing on the vital importance of the CDBG program. My name is Donna Harris, and I am Executive Director of the Kentucky Mountain Housing Development Corporation (KMHDC), a nonprofit housing and community development organization located in Manchester, 
Kentucky. I am also a member of the Board of Directors of the National Rural Housing Coalition, and my organization partners with the Housing Assistance Council and the Federation of Appalachian Housing Enterprises.
Located in the Appalachian Mountains in southeastern Kentucky, KMHDC provides affordable homeownership opportunities for some of the most impoverished families in the nation. During the past 31 years Kentucky Mountain Housing has built repaired and financed more than one thousand single family homes for families with incomes well below poverty level. We have used the CDBG program to help numerous very low-income people become homeowners. In one of our projects we used $1 million in CDBG funding in our revolving loan fund to finance more than 30 homes for low-income families. In addition to the housing construction and repairs completed, the CDBG program also stimulates the economy and provides job opportunities for local people. Our most recent CDBG project resulted in a significant increase in the number of units we are able to produce and an increase in our workforce.
I appreciate the value of CDBG in the impoverished areas of Central Appalachia and in the lives of the people who call rural communities home. CDBG is one of HUD’s most important programs – it is one federal resource that truly invests in low income people and poor neighborhoods, and in so doing, builds the entire community. I strongly suggest that we keep CDBG funding at the current level or increase it, if possible. In my opinion it would be wise to leave this program in tact within HUD, instead of moving it to another agency. In rural areas such as ours there are few resources available to help low income people achieve the American dream of affordable homeownership. The CDBG program is still one those vital resources that we use to help build and strengthen our communities. We need this program more now than ever before.
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Discussing the importance of CDBG program before staff of the U.S. House of Representatives are, from left, Doug Woodruff, Community Development, Bank of America; The Honorable Mayor Earlene Johnson, Colony, Ala.; the Honorable James Hunt, Councilman, Clarksburg, W.Va. and First Vice President, National League of Cities; Donna Harris, Executive Director, Kentucky Mountain Housing Development Corporation, Manchester, Ky.; and Amintha K. Cinotti, Deputy Director of Planning and Development, Providence, R.I. (Photo courtesy of LISC) |
STATES, AS WELL AS CITIES, USE THE CDBG PROGRAM
It is important to remember that states are vital partners in CDBG. CDBG is the only federal program of its kind, providing states with a flexible block grant that can be used in a variety of ways to address specific community development needs. The CDBG Flexible Block Grant is important because communities are dynamic and unique entities with varying needs. Overall, states use little more than half of their funding allocations on public infrastructure, projects such as water and sewer improvements in rural low-income communities, certain types of roadwork, and public facilities such as community centers. A significant portion of state CDBG, about 25 percent, is spent on housing rehabilitation. Without this assistance, low-income homeowners are often unable to repair their homes and are forced to either live in unsafe conditions or lose their homes.
CDBG INVESTS IN INFRASTRUCTURE
CDBG is vitally important to rural areas as a source of funds for infrastructure – water and sewer lines particularly. Water and wastewater connections in rural housing development are usually not there ready to be hooked up at the curb - they have to be created. CDBG is the only federal funding available to help states address water and sewer needs of low-income rural areas. In many places, obsolete systems must be completely replaced or there is a need for expansion to address growth; and yes, even in 2005, there are many rural areas in America where people must haul their water from outside their communities because their wells are contaminated and there is no water or sewer system. The map attached to my statement shows inadequate plumbing conditions nationwide.
Central Appalachian homes are among the nation’s highest levels of occupied homes with inadequate plumbing. A national study by the Housing Assistance Council found that over 80 percent of Central Appalachian counties have rates of units with inadequate plumbing higher than the national level.* In my service area, more than 3 percent of the homes lack adequate plumbing, far above the national average of 0.6 percent. Small rural communities in Kentucky and nationwide often struggle to provide the public services most of us take for granted — adequate sewage disposal and clean drinking water.
Most of these communities have few resources, and it is often CDBG, which facilitates improvements in infrastructure and housing stock. Our communities need this program. Our communities need more programs like CDBG.
CDBG INVESTS IN HOUSING PRODUCTION
CDBG is a key piece of the affordable housing and community development tool kit in urban and rural America. Many rural households find it difficult to meet basic housing expenses. Among the 23 million nonmetro households, approximately 24 percent — 5.5 million households — pay more than 30 percent of their monthly incomes for housing costs and are considered cost-burdened. Of these, 2.4 million pay more than half their incomes toward housing costs. We cannot afford to lose CDBG funding. If anything, more has to be done to assist low-income families resolve their housing needs.
Federal housing assistance has played an important role in the production of low- and moderate-income rural housing since the mid-1930s. Yet, according to a methodology developed by the Housing Assistance Council, only 7 percent of non-metro households receive some type of federal or other publicly supported housing assistance. HUD’s CDBG program has served as critical investment for increased housing production throughout the country.
CDBG helped to change more than just the housing conditions of the Mathis family; it helped change their very lives. Ricky and Rosalie, along with their two young sons, aged 8 and 13 lived on a meager income of only $6,946 per year. Their dilapidated mobile home was 37 years old and to add to the already prevalent safety issues involved with such a home, during the cold winter months the Mathis’ used a coal stove to heat the structure. The mobile home was in far too poor condition to rehabilitate, so we started from the ground up, replacing the mobile home with a newly constructed house. Thanks to CDBG, the Mathis family became the proud owners of a quality affordable home built and financed by Kentucky Mountain Housing. With a renewed outlook on life, Rosie enrolled in college and earned a degree, and now works in social services in our community.
Another family we assisted with CDBG funds are the Philpots. Cynthia is a single parent who was paying $300 a month for rent on the apartment she shared with her two children, a 6 year-old daughter and a 4 year-old son. She earned $5.50 an hour and her total gross income only came to $9,765. With the help of CDBG we were able to build Cynthia a brand new home with a monthly payment of less than what she previously paid for an apartment.
CDBG INVESTS IN IMPROVED HOUSING
For most of the 20 th century, substandard quality was the primary rural housing problem. In Appalachia and in the rest of the country, there have been many gains in rural housing quality, largely because of federal programs. But substandard housing still exists, especially in rural areas and central cities. Twelve (12%) percent of low-income households in nonmetro areas live in physically inadequate housing.
However, the CDBG program has made a difference in the lives of low-income elderly and disabled families relying on fixed incomes as their sole support. There are families like Mrs. Smith’s living in a 60 year-old structure without the benefit of an indoor bathroom or running water. The elderly widow’s grown children were concerned with their mother’s health because she had to draw her water from a well outside her house. She also heated her house with a coal stove. Since the house was poorly insulated, she burned about 4 tons of coal each winter. In order to heat her house she carried in coal in buckets and had to make sure the fire didn’t go out or her house would get cold. Programs like CDBG can provide much needed water and septic systems for people in rural America like Mrs. Smith. With much needed repairs provided by KMHDC and church volunteers she finally got her first indoor bathroom.
On a CDBG site visit we met a young couple that was raising their two pre-school age sons in a storage shed because they couldn’t afford to pay rent. Despite his factory job, Bobby Joe did not earn enough to afford a safe and decent home. That all changed when he qualified for a home from Kentucky Mountain Housing. Before the children started school, the family purchased a safe and affordable home of their own which we built and financed at an affordable cost.
CONCLUSION
This is the wrong time to turn our backs on the needs of America’s rural communities. This is the wrong time to cut back or cut off one of our most successful community development resources. Rural America needs housing production. Rural America needs to improve its housing stock. I am here to tell you that Rural America needs CDBG.
Thank you and God bless you.
(Photo courtesy of LISC)
