Testimony to City Council: Invest in the Housing Trust Fund

Carrie Rathmann testified virtually on May 27 to call on City Council to invest in the Housing Trust Fund. The full text of her testimony is included below.

Good afternoon, and thank you for the opportunity to testify today. My name is Carrie Rathmann. I am Director of Strategic Partnerships at Habitat for Humanity Philadelphia.

This crisis has exposed so many of our social fragilities. It has dramatically illustrated that inequities of all kinds diminish our resiliency as a society. It has also exposed our collective stability to be more intertwined than we choose to acknowledge. Ensuring that everyone has access to safe, decent, and affordable housing is one of the key steps towards greater stability and our ongoing resilience as a city.  If we care about health, sheltering at home, education, economic stability, crime reduction, safety, keeping families intact- then we care, first-and-foremost about housing. Furthermore, investing in housing is an upstream strategy, ultimately saving the City and taxpayers from more expensive social and human service interventions down the line.

At Habitat, we care about all the issues mentioned here. But we see first-hand that housing is always a sound investment in each those areas. That’s why we work to build strength, stability and self-reliance through shelter. We do this through two core affordable housing programs: our Homeownership and our critical Home Repair Program.

Homeownership

Habitat builds and rehabs safe, healthy, and, energy-efficient affordable homes with low-income Philadelphian’s making 30-60% of the AMI. Families partner with Habitat and provide 350 hours of sweat equity labor; building theirs and others’ homes, and learning to become empowered homeowners. In exchange, these families purchase their new home with an affordable mortgage product that Habitat secures or holds.  Usually, the Habitat mortgage is less than a household was paying in rent for sub-standard housing where they were investing more than 30% of their monthly income to rent.

Repairs
We also provide critical repairs for low-income homeowners making up to 80% AMI.  Through an average cash investment from Habitat of $15,000 per home, we ensure the integrity and safety of homes where we work. These are the homes of the city’s 60,000 or so lower-income homeowners.

At this time when staying safe means staying home, we are disheartened to see the proposal to cut general fund dollars to the Housing Trust Fund for Fiscal Year 2021. Now is the time to invest MORE in the HTF.  We need more resources for the Fund as building and preserve affordable, accessible housing will be a critical part of the city’s recovery from this pandemic. Cuts now to the HTF mean fewer affordable home preservation or repair activities that address critical health and safety concerns, and more residents living in conditions that lead to injury and illness. It means less families can ever access affordable homes- rental or owned. It means the city’s fragile homeowners will be more vulnerable to losing their only financial asset. Ultimately, it means these cuts will require more investment down the road when housing instability leads to more problems and costly solutions for vulnerable families and the City alike.

For example, the average Habitat home repair, or modification project is $15,000 versus the following:

• $40,000 for one year in a nursing home
• $25,200 to temporarily house a family in a shelter for 6 months
• $16,600, plus the cost of foreclosure to demolish an abandoned row-home

We urge Council to ensure the Mayor’s minimum allocation of $14M still goes into the HTF. We urge you to allocate at least $20M next year.

As if we were not already living in a bifurcated world, now the ladder straddling the wealth gap is being pulled up- even faster than before thanks to COVID. If we don’t take steps now, we will continue to widen inequity in our city. And now with COVID, these are acute life and death decisions. The Housing Trust Fund serves the Philadelphia residents who are being hit hardest by this pandemic—people with disabilities and families of color with the lowest incomes. Now is not the time to turn our backs on them.

Mayor Kenney and City Council must honor their commitment and invest the General Fund dollars committed to the Philadelphia Housing Trust Fund for Fiscal Year 2021.

We understand that Council and the Administration are being forced to make painful choices and cuts.  We hope that you will recognize the fundamental role that housing plays in human stability and Philadelphia’s ongoing resilience to weather an even more uncertain future.

Thank you for your time and attention today.