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Government, Federal Affairs, Municipalities in the News, Real Estate

Reinventing Public Housing Management

HUD Secretary Mel Martinez signs historic agreement allowing several municipalities to manage some of their public housing developments


March 6, 2003
Copyright © 2003 CARIBBEAN BUSINESS. All Rights Reserved.

In an effort to improve services for public housing residents in Puerto Rico, U.S. Housing & Urban Development (HUD) Secretary Mel Martinez and officials from four municipalities and the government of Puerto Rico last week signed a historic memorandum of understanding (MOU) that for the first time places the management of local public housing developments in the hands of the municipalities instead of those of the central government or the private sector.

The MOU transfers the authority over five public housing developments from the Puerto Rico Housing Administration to the municipalities of Caguas, Guaynabo, Manati, and Carolina.

Unlike the rest of the U.S., where public housing is administered in part by local governments (cities and counties), all public housing in Puerto Rico had been managed by the central government, explained Martinez. "The signing of this MOU marks a historic day in the management and operation of public housing developments in these communities," Martinez said during last week’s signing ceremony at Los Alamos public housing development in Guaynabo.

Accompanying Martinez were Caguas Mayor William Miranda Marin, Guaynabo Mayor Hector O’Neil, Manati Mayor Juan Aubin Cruz, and Carolina Infrastructure Director Maribel Cruz, representing Mayor Jose Aponte. HUD Assistant Secretary Michael Liu, who heads the federal agency’s Office of Public & Indian Housing, was also present.

In an exclusive interview with CARIBBEAN BUSINESS, Martinez explained that the MOU was drafted after several island mayors visited him in Washington to express their desire for more local control over housing development matters in their municipalities. If they had more control, the mayors argued, the municipalities could provide additional services.

"With Secretary Liu’s assistance, we began talks with the mayors, and after many months of work we now have an MOU involving four municipalities and we expect to have more in the future," said Martinez.

The MOU, which becomes effective April 1, implements a two-year pilot program that allows the four municipalities to manage five public housing developments with a total 1,395 units, explained Liu. The housing developments are Los Alamos in Guaynabo with 376 units, Gautier Benitez in Caguas with 492 units, Sanchez Osorio and Cantanito Gardens in Carolina with 310 units combined, and Los Murales in Manati with 217 units.

The municipalities--which already administer HUD’s Section 8 rental assistance program--will manage all the operations of these developments on behalf of the Puerto Rico Housing Administration (PRHA). They will assume responsibility for modernization, demolition, development, and homeownership opportunities for these developments, Liu indicated.

"The municipalities and the PRHA will sign individual contracts for the operation of the pilot program," said Martinez. "They will assume control from the private contractors who currently manage the developments for the PRHA."

The PRHA will provide the necessary resources, financial and otherwise, to the municipalities to manage the five developments.

"If the pilot program is as successful as we think it will be, others will participate and maybe there will be an evolution in all or in a substantial number of municipalities," said Martinez. "We need responsible local governments to be able to expand it to many more municipalities across the island."

Martinez said the MOU wasn’t drafted sooner because the PRHA hasn’t had a good management record, though the situation has been improving. "We’ve always had problems here, but we are happy with the housing management right now," he said. "We are going to do things differently [the MOU] and we’ll see if they work."

During his short visit to Puerto Rico, Martinez also announced that San Juan and Barceloneta would share $78 million in loans guaranteed by HUD to fund various public improvements projects and expand affordable housing.

San Juan’s $72.5 million will go to improving the streets, lighting, parks and recreation centers, and signage in select low-income neighborhoods. The funds will also be used to convert an abandoned Coast Guard facility into a development center for abused or orphaned children and to create a new neonatal intensive care unit at the Rio Piedras Medical Center.

Barceloneta will get $5.5 million in low-cost financing to buy and rehabilitate 20 properties. Ultimately, the assistance will help to generate 14,000 square feet of commercial rental space, produce 11 affordable housing units, create 350 parking spaces, and make sidewalk improvements. The commercial space is expected to create 65 jobs for low-income residents of Barceloneta.

The funding, said Martinez, provides local governments with a potent public investment tool to renew communities. Public commitment, added the HUD secretary, is often needed to inspire private investment to stimulate community development in distressed areas.

"This assistance demonstrates that HUD is a full partner in helping revitalize neighborhoods," said Martinez. "These guaranteed loans will help bring a new sense of public commitment in areas that serve lower-income families in San Juan and Barceloneta."

This Caribbean Business article appears courtesy of Casiano Communications.
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