The clock struck midnight on Tuesday, when the Department of Welfare, as directed by Governor Tom Corbett’s budget, terminated the General Assistance Fund, affecting more than 60,000 Pennsylvanians.
The GAF provided a lifeline — sometimes, the only one — for victims of domestic abuse, those in treatment and recovery, and children living in different households than that of their birth parents.
According to the non-partisan think tank Better Choices for Pennsylvania, the elimination of the General Assistance Fund’s $160 million earmark represents the biggest, single cut in Corbett’s budget, and will terminate the $205 monthly benefit for the now-former recipients. However, according to the Executive Budget, the commonwealth will actually cut $319 million from the combination of eliminating the General Assistance Fund and reforms made to the eligibility criteria for those seeking Medical Assistance.
While $205 may not sound like much, the termination of that benefit, along with that of the other provisions in the GAF, will surely hurt the very people who have been hurt the most.
“General Assistance funding was a last resort — a small but sturdy thread in Pennsylvania’s suddenly shabby safety net — for tens of thousands of our most vulnerable citizens. The program’s elimination is deeply troubling for 68,000 disabled individuals, domestic abuse survivors, drug/alcohol treatment center enrollees and children under the care of an unrelated adult,” said Housing Alliance of Pennsylvania Executive Director Liz Hersh, a longtime proponent of rights for the disenfranchised. “The overwhelming majority of these citizens will now be forced to go without their sole source of income as they struggle to keep a roof over their heads, secure a room in a boarding home, or pay for treatment program fees.
“By eliminating General Assistance, our elected officials run the risk of increasing homelessness, adding tens of millions in costs to other state programs, and exhausting already-overburdened private organizations,” Hersh continued. “All this, despite the fact that nearly four in five registered voters in Pennsylvania have said they oppose balancing the budget by cutting human services programs.”
There are elected officials who railed against the termination of the lifeline. State Representative W. Curtis Thomas blasted the decision in a letter he wrote to Corbett in June, while also voicing his displeasure that at that time lifeline recipients hadn’t been duly informed of looming cuts.
“As you know, this decision will involve an overwhelming number of individuals, children and victims of domestic violence who are considered disabled,” read Thomas’ letter, in part. “I am extremely troubled by this decision in light of a myriad of economic, social and medical circumstances which face people today more than any other time in the Commonwealth or the United States.
“I am more troubled by the fact this decision is being made in absence of a lifeline for people who have no other resources … the disabled population is not only without resources, but are also faced with physical and mental problems that aggravate their everyday challenges.”
Corbett’s budget includes $101.6 million for a children’s health program, representing an increase of 4.4 percent, along with $1.7 million for Adult Protective Services — but it remains to be seen if these and other programs will fill the gap left by the dissolution of the GAF. But for Hersh’s part, she hopes that elected officials and the public and private sectors continue to help those in need.
“Moving forward, it is imperative that our elected officials work with private organizations, faith-based efforts and citizens across the state,” Hersh said, “to use available resources to preserve a safety net for our most vulnerable citizens and alleviate the burden of homelessness throughout the Commonwealth.”
The Homeowner Emergency Mortgage Assistance Program is one step closer to resurrection.
The State House recently returned Senate Bill 1433, which would restore HEMAP funding, as well as provide other provisions for homeowner relief. The House of Representatives earlier this week voted unanimously to approve the legislation, which now awaits final approval by the Senate.
The bill, introduced by Senator John R. Gordner, R-Columbia, and co-sponsored by more than two dozen fellow state legislators, would divvy up the estimated $266 million Pennsylvania is to receive through settlement of the multi-state lawsuit against the nation’s five largest mortgage lenders.
The five companies — Ally Financial, Bank of America, Citigroup, JPMorganChase and Wells Fargo — were ordered to pay the $25 billion settlement due to its predatory lending tactics and the so-called “robo-lending” method of guaranteeing initial mortgages.
“The Attorneys General of 49 states, including Pennsylvania, have reached a $25 billion settlement with the country’s five largest lenders to end mortgage servicing and foreclosure abuses that stemmed from the recent lending scandal,” Gordner said via a statement released by his office. “Pennsylvania will receive approximately $60 million to be used for consumer and mortgage foreclosure protection programs.
“HEMAP has proven to be highly effective,” said Gordner. “Nearly 85 percent of homeowners who took part in the program remain in their homes. That’s good for our communities, and a necessary part of an economic recovery.”
This will be good news for organizations such as the Philadelphia Unemployment Project, The Pennsylvania Saving Our Homes Coalition and the Housing Alliance of Pennsylvania, which has long fought for HEMAP’s funding — and ultimately, its survival. The organization has staged several rallies and marches in support of HEMAP, going so far as to sit in on several House and Senate housing committee sessions.
“We appreciate the legislature earmarking these funds to aid homeowners,” said Philadelphia Unemployment Project Executive Director John Dodds. “A number of states used the settlement money to balance their budgets, and that is not what these funds are for.
“There is widespread support for HEMAP, but we couldn’t get funds into the governor’s budget. The National Settlement funds allow the state to resume the program using outside dollars.”
Alan Jennings, Executive Director of the Community Action Committee of Lehigh Valley called it, “the most sensible thing Pennsylvania could do to rescue homeowners, and what the Commonwealth was doing for 30 years.”
“It’s great that our legislature came around to doing just that,” Jennings said. “[By] restarting the Homeowners Emergency Mortgage Assistance Program.”
Senate Bill 1433 would not only fund the program, which hasn’t provided assistance to new clients since September 2011 because of state budgetary issues, but also Attorney General consumer protection services and legal assistance related to housing issues. Ninety percent of the fund’s money is set aside for the Pennsylvania Housing Finance Agency (PHFA) to operate HEMAP, with the remaining ten percent split evenly between the other two purposes.
“The legislation stipulates no more than $12 million will be distributed from the fund on a yearly basis for the targeted services,” read HEMAP’s explanatory statement, in part. “An additional $6 million will be appropriated immediately for HEMAP to address a backlog of new clients.”
HEMAP came into existence in 1983, to provide homeowner assistance to residents in western Pennsylvania who lost their jobs when the mining industry collapsed there. It has since expanded its services to every Pennsylvania homeowner. The fund has helped more than 46,000 Pennsylvania families stay in their homes since its inception.
Housing Alliance of Pennsylvania Executive Director Liz Hersh commended Gordner for taking up the cause, and voiced optimism that the legislation will muster enough votes for passage.
“We’ve [got the funding], so it’s absolutely great news. We had to go a year without HEMAP, which is unfortunate, but I think the legislature and the governor all heard what everyone was saying, that we need these programs to save people’s homes,” Hersh said. “Senator Gordner has really understood the importance of this, and he took the lead and initiative; we really appreciate his leadership.”
Hersh confirmed that $6 million will be made available immediately for truly distressed homeowners, but underwater homeowners can apply for assistance in the very near future.
“I think the Pennsylvania Housing Finance Agency is hoping for an August 1 date to reopen the program, but I believe once the vote comes, it will begin taking applications through housing counseling agencies, so when the program does reopen, they will have a pipeline,” Hersh said. “That $6 million portion is to be used right away for the cases out there, so [PHFA] is hoping to get the pipeline filled. They have to put notices out and take the normal steps, but they really hope to hit the ground running.”
While many assistance programs experienced drastic cuts to its funding when Governor Tom Corbett released his latest budget, the Homeowners’ Emergency Mortgage Assistance Program — HEMAP — has had to shutter operations entirely due to its lack of funding, which could have detrimental effects for the thousands of Pennsylvania homeowners who are facing foreclosure.
“Last year, HEMAP was funded at $2 million, and that was not enough to keep the program open, so HEMAP actually closed to new applicants last July,” said Housing Alliance of Pennsylvania Executive Director Liz Hersh. “This year, the governor has proposed zero, which means the program will stay closed.”
HEMAP, since its inception almost 30 years ago, has helped 47,000 Pennsylvania homeowners in total; 6,100 were assisted from 2008 to 2010 alone.
“HEMAP has reduced the foreclosure rate in Pennsylvania, and it had an 85 percent success rate,” Hersh said. “We’re not talking about tossing money out the window.”
Hersh referenced a recently released report from the Reinvestment Fund, a non-partisan group that distills homeowner data into trends and forecasts. The Research Brief: “What if Pennsylvania had not had HEMAP?” found that the state invested $38 million in homeowner relief programs from 2008 to 2010, but those programs also saved the state — and by extension, lenders and local governments and municipalities — $480 million during that same time period. “Were it not for HEMAP, Pennsylvania’s foreclosure rate would have been much higher,” said the Reinvestment Fund Director of Policy Solutions Ira Goldstein. “Over this period, the number of homes saved from foreclosure by HEMAP amounted to between 4.6 percent and 5.1 percent of the total inventory of homes in foreclosure.”
The report also concluded that every county in the commonwealth experienced an average of $3.7 million in positive financial impact due to HEMAP.
HEMAP began in 1983 as a result of the steel mill closures in Western Pennsylvania and the subsequent effects it had on homeowners in that region.
The Governor’s office seemed cognizant of HEMAP’s successes, but noted that this was one of a series of cuts the governor had to implement to balance the budget.
“HEMAP has been around for years, and its funding has gone up and down a lot, and [its funding] is discretionary,” said Corbett spokesman Eric Shirk. “But I can tell you this was a difficult budget, and the governor had to make difficult cuts and difficult decisions.”
But all hope isn’t lost for Pennsylvania homeowners.
Recently, the Pennsylvania Attorney General joined the $25 billion joint state/federal settlement with the nation’s five largest mortgage and housing lenders — Ally, Bank of America, Citi, JPMorgan Chase and Wells Fargo. The agreement stems from several attorneys general suing the lenders for so-called “robo-signing” and other abusive tactics.
“This settlement provides an estimated $266 million in assistance to Pennsylvania, including principal reductions for consumers struggling to avoid foreclosure, refinancing relief for homeowners who are ‘underwater’ — owing more that their homes are worth — and payments to borrowers who lost their homes,” said Attorney General Linda Kelly through a statement released through the attorney general’s office. “It also addresses breakdowns in the mortgage servicing industry, provides new protection against abuse and allows us to pursue other mortgage-related misconduct.”
According to Kelly, the state’s share of the settlement is broken down into specific programs aimed to cure the major issues facing homeowners. Loan modification and debt-relief programs will receive $93 million, while Pennsylvania homeowners who were victims of loan abuse and lost their homes as a result would receive $21 million. Homeowners who are “underwater” will now be able to refinance their homes, with $81 million of the settlement going toward that service. And finally, $69 million will go directly to the commonwealth itself.
It’s that $69 million that many think should also go toward relief for embattled homeowners.
“This is a terrible time to stop the funding programs for the housing crisis. It’s pretty much an indictment on the Corbett administration,” said John Dodds, director of the Philadelphia Unemployment Project. “Corbett put nothing in his budget for HEMAP, but $69 million is going directly to the state; that should also be going to these programs, although some states dump that money into its general fund.”
Hersh sounded optimistic that this settlement will change the way the housing industry does business.
“The attorneys generals negotiated this deal … and the result of that is the mortgage industry has to change the way it does business,” Hersh said. “And that’s good. And now they have to put money in to helping homeowners.”
Philadelphia can be a great city to live in — if you can afford it.
And according to the Housing Alliance of Philadelphia, more and more low-income Philadelphians are feeling the financial squeeze of finding adequate and affordable housing.
The National Low Income Housing Coalition recently released a sobering report, which concluded that nationally, more than 25 percent of all renter households now must spend over half their income on housing related costs. Those problems become multiplied and magnified when factoring in low-income renters who do not receive any government subsidies.
“Housing affordability problems disproportionately impact the lowest American households … in 2010, 53 percent of the 19.4 million cost-burdened renter households were households earning under $20,000 a year,” the report read. “Renters earning under $20,000 make up one-third of the total renter population.”
That resonates in Philadelphia, especially when considering there are only 36 units out of every 100 available that are both available and affordable “for people that are severely low income,” according to Pennsylvania Housing Alliance Executive Director Elizabeth Hersh, who defined “severe low income” as those renters and prospective renters who earn $20,000 annually or less.
“There’s only about a third of the housing available that is needed; it basically means you have a supply-side problem,” Hersh said. “Making $20,000 is about $12 dollars an hour, which isn’t a bad wage. It’s four dollars above minimum wage, which means people that are working and playing by the rules can’t afford housing.”
The Department of Housing and Urban Development recently released a report that backs up the claims leveled by Hersh. That document, “Worst Case Housing Needs 2009,” found that the number of renters with worst case needs jumped 20 percent between 2007 and 2009, the last year of quantifiable data. The report defined people with “worst case needs” as severely low income Americans earning at or below 50 percent of the Area Median Income, or AMI.
“Over the past several years, housing prices have continued to rise, and have risen much faster than income, especially for people of low income,” Hersh said. “So you have this widening gap between what people earn and how much it costs to rent a place. And that’s one thing that has made the problem worse.”
Hersh also believes that recent government cutbacks have dampened the “American Dream” of home ownership or living in a decent apartment; the results of a predatory lending industry that issued mortgages to people unable to make payments has trickled down to the rental sector as well.
“They really weren’t building a healthy rental market, and haven’t had adequate growth in the rental market,” Hersh said. “There’s an over-supply of owner-occupied units and an under-supply of high-quality rentals for people living on real wages.”
There is also another obstacle blocking the creation of quality housing for low-income renters, and that boils down to the very nature of being in business to begin with.
“Let’s say you’re going to do the right thing; you own an apartment, and decide to rent to a low-wage earner, someone making ten bucks an hour,” Hersh theorized. “That rental [revenue] stream is not enough to cover your own expenses” incurred from owning the rental unit.
“In Philly, there’s plenty of [overall] rental stock, but you can’t keep the rent low and meet housing codes.”
All is not lost for low-wage earners aspiring to move into decent housing, Hersh said.
“From a rental perspective, there’s lots we can do; in Philadelphia, there’s the local housing trust fund,” Hersh said. “We also could fund the state housing fund. There’s also a national housing fund, dedicated exclusively to rentals.
“The president has put a billion dollars in his budget for that, which would bring a nice chunk of change to Philadelphia.”
Hersh feels other politicians beyond the president should help via legislation.
“We should look at it like building bridges and create the infrastructure and financial incentive to provide quality and affordable housing. I think the way we’ve been going, shrinking public investment in the housing market is the wrong direction,” Hersh said. “From our perspective, the housing market leads the way out of the recession. The private market alone — or capital and tax credits and subsidies — cannot provide adequate supply.
“We are missing an opportunity to grow the market and economy.”
Now resuscitated, program had been dead for over a year
The crucial Homeowners’ Emergency Mortgage Assistance Program has new life, and thousands of Pennsylvania homeowners can finally exhale in relief, thanks to the commonwealth receiving its share of a multi-million dollar, federal settlement with five of the nation’s largest mortgage grantors.
The bulk of Pennsylvania’s share — $66.5 million — will go toward HEMAP and other housing-related services.
“With the receipt of these funds, HEMAP will now begin accepting applications,” Pennsylvania governor Tom Corbett said. “The foreclosure prevention assistance provided by HEMAP directly helps families in danger of foreclosure. This multi-year funding for HEMAP will not only help troubled homeowners, but will play a role in restoring the health of our state’s housing industry.”
In June, Corbett signed Senate Bill 1433, which became the Homeowner Assistance Settlement Act, which authorized the disbursement of the state’s share of the settlement.
According to Corbett’s office, HEMAP will receive 90 percent of these funds over the course of several years, with the remaining ten percent going to several consumer protection services overseen by the attorney general. HEMAP will also receive an additional $6 million to deal with the anticipated backlog of applications.
Homeowners who are at least three months delinquent on mortgage payments are eligible for HEMAP; information is available on the Pennsylvania Housing Finance Agency website: www.PHFA.org.
“We’re grateful to Governor Corbett, Attorney General Kelly and the legislature for making this funding available,” said Pennsylvania Housing Finance Agency Executive Director and CEO Brian A. Hudson Sr. “HEMAP has a proven track record for working to keep families in their homes, which helps communities as a whole.
“Many families and neighborhoods will benefit from this renewed funding for HEMAP.”
The Housing Alliance of Pennsylvania and the Pennsylvania Unemployment Project both hailed HEMAP’s resuscitation.
HEMAP was started in 1983 to help homeowners avoid foreclosure mining bust in Western Pennsylvania that ravished the homeowner base at the time. During the last 29 years, HEMAP has provided foreclosure prevention assistance to more than 46,000 families and the program has maintained an 85 percent success rate for helping families stay in their homes.
“This is great news and is the result of a year-long campaign by advocates around the state to get the program reinstated after it was closed due to budget cuts in July 2011,” said Housing Alliance of Pennsylvania Executive Director Liz Hersh, who referenced a recent report by The Reinvestment Fund, which provided a synopsis of what housing in Pennsylvania would look like without the existence of HEMAP. “HEMAP actually reduced the foreclosure rate in Pennsylvania during the depths of the crisis; it is 85 percent effective in preventing foreclosure and it ends up saving the Commonwealth money.
“Most importantly, it buffers homeowners facing foreclosure through no fault of their own due to job loss or illness, by giving them a bridge loan until they get back on their feet.”
Philadelphia Unemployment Project Executive Director John Dodds and Hersh have led several caravans to marches on Harrisburg over the matter, and have petitioned several politicians to refund HEMAP, and Dodds believes the efforts were worth it.
“We are really happy that HEMAP is now available to homeowners again after over a year closed due to budget cuts,” Dodds said. “Organizations and homeowners from around the state came together in the PA Save Our Homes Coalition and worked on restoring the program for the past year. Restarting HEMPAP is one of the few good things that have come out of this year’s budget process.”
The Housing Alliance of Pennsylvania — long an advocate for fair and affordable housing for working poor and at-risk individuals and families — has joined the cacophony of cries from other organizations upset with Governor Tom Corbett’s budget, which slashed the funding for many programs and social services, including much-valued housing safety nets.
The alliance — which has organized caravans to both Harrisburg and Washington, D.C. — has made weekly trips to both lawmaking centers to express its dismay. The alliance’s next trip to Harrisburg will be on Wednesday, March 28; the organization will spend the day listening to and providing testimony in regard to the slashing of housing programs.
“The main thing is, we’re trying to connect people in the community with the decision makers of the state and federal budget, so they can talk face to face,” said Housing Alliance of Pennsylvania executive director Liz Hersh. “One of the things in the budget that we are very concerned about is that it takes away the investment in prevention, such as the Homelessness Assistance Program.
“We’re really concerned with that, because there’s no other plan in place.”
Hersh said that about 68,000 Pennsylvanians lived off $200 a month through the program, and with that funding now gone, those people and other vulnerable Pennsylvanians will have to scrape that much more. Those affected could include single parents, victims of spousal and domestic violence, and the disabled.
“A lot of legislators don’t think [the $200] makes a difference, but these people have nothing,” Hersh said. “And when you do get a [housing assistance] lump-sum payment, the state gets its money back, so there’s a repayment component. But what to do when people don’t have that money?”
Troy Purrington, formerly homeless, didn’t have the money, and wound up homeless for the better part of a year. He said he knows just how tough it can be since he’s “walked in the shoes of the homeless.”
“It is very depressing being homeless,” said Purrington, a recovering drug and alcohol addict. “So this is very important to me, as the only programs that helped me were the Housing Alliance and my recovery program.”
Purrington often travels to both capitols with the alliance, and believes that the homeless and those who care about them should go eyeball to eyeball with legislators.
“It’s an honor to represent the homeless, and with all these cuts to funding, it will be good for everyone to meet the legislators and senators who make the decisions. We need the right leadership.”
Hersh said the Alliance is not starting a controversy or looking for a conflict; rather, she’s hoping the dialogue will continue.
“State lawmakers are listening. Our elected officials [go into office] because they want to make a difference, make communities better,” Hersh offered. “We know they have reasons for what they do, but they are human, too.
“We’re trying to engage them in a dialogue on how we can work together. It’s not about a conflict; it’s about us all being in this together.”
Hersh welcomed willing folks to join them on the caravan, but said they didn’t have to necessarily travel to Harrisburg or Washington, D.C., to have their voices heard.
“You can call your local legislative office and ask for five minutes on the phone with a member,” Hersh said. “This is a democracy, and we need to honor it; it’s not only a freedom, but an obligation.”
Bank pays for predatory racially-based lending
Wells Fargo has set aside $175 million to settle racial discrimination and predatory lending allegations for illegal practices that allegedly defrauded more than a thousand African-American homeowners.
The decision between Wells Fargo and the United States Department of Justice — the lead agency investigating the claims — effectively ends the investigation, according to the Pennsylvania Human Relations Commission. The fund will include $2 million for city residents, and an additional $50 million for alleged victims living in eight metropolitan areas, including the Philadelphia-Camden-Wilmington area.
“Fair housing is a right in Pennsylvania,” Commission Chairman Gerry Robinson said. “This settlement will help ensure that it is a reality.”
The settlement directly affects African-American homeowners who obtained home loans from Wells Fargo between January 1, 2004, and December 31, 2009. Rebates will also go to homeowners who may have qualified for prime loans, but were instead issued non-prime rates from Wells Fargo.
“I was shocked that there was enough of a ‘smoking gun’ that it ended up in a settlement, but the fact is that in this day and age that these discriminatory practices take place,” said Housing Alliance of Pennsylvania Executive Director Liz Hersh, who also mentioned that homeownership rates among African-American and Latinos is still significantly low. “If they can now make this right and give people a chance, that’s great.”
According to the PHRC, the investigation, which began in July 2010, initially looked at the mortgage and foreclosure policies and practices with Wells Fargo Home Mortgage and Wells Fargo Financial Pa. Inc., and found the company liberally employed a “redlining” tactic — which targets African-American homeowners, regardless of ability to repay.
“The commission investigation was prompted by its statistical analysis of U.S. Dept. of Housing and Urban Development statistics, conducted with HUD funding,” read a statement from the PHRC. “The study revealed substantial disparities in pricing and foreclosure rates between African-American and white borrowers. Such practices would violate the HUD enforced federal Fair Housing Act, and the PHRA, which the commission enforces.”
Congressman Chaka Fattah, a longtime proponent of equal housing causes, commended Attorney General Eric Holder and the U.S. Justice Department for battling to “right the wrongs of this national disgrace.”
“The $175 million settlement with Wells Fargo, one of the nation’s largest lenders, is an indication that aggressive investigation can result in justice for those victimized by patterns of discrimination on the basis of race or national origin. While instances of severe racial profiling and discrimination in home mortgage lending, predatory practices, misleading paperwork and hard-sell for sub-prime mortgages extend back at least to 2004, serious investigation of these allegations didn’t begin until after the Obama Administration took office in 2009,” Fattah said. “I have been urging the Department of Justice since 2009 to step up the pace of investigations, and led the fight in the House Appropriations Committee for the extra resources that have helped fund these probes.
“In addition, as a legislator who has won enactment for programs to assist distressed homeowners on the state and national level going back to the 1980s in Pennsylvania,” Fattah continued, “I’m gratified that today’s beneficiaries include about 1,030 African-American homebuyers in the Philadelphia area who may have been victims of illegal predatory lending.”
HARRISBURG — A program that provides about $200 a month for tens of thousands of disabled adults who can't work is on the chopping block even as improving tax collections give state lawmakers the freedom to reverse some of Gov. Tom Corbett's proposed cuts in spending for things like universities, the race horse industry and the Legislature itself.
Corbett, a Republican who ran on a no-new-taxes pledge, advocated doing away with the $150 million General Assistance cash benefit in a $27.1 billion budget plan he released in February. It called for a series of cutbacks he blamed largely on the rising cost of pensions and health care for the poor.
Then senators voted 39-8 last week for an alternative, $27.7 billion budget that also would eliminate the cash benefit while adding hundreds of millions of dollars to the subsidies that Corbett proposed for universities, public schools, county-run social services, the race horse industry, medical research, retailers that collect sales taxes and hospitals and nursing homes that care for the poor. Senators also plugged in $12 million to erase cuts in the Legislature's accounts that Corbett proposed.
House Majority Leader Mike Turzai, R-Allegheny, suggested that the House — which like the Senate is controlled by Republicans — was unlikely to change the elimination of the General Assistance cash benefit when it considers the Senate's plan.
"I think that our colleagues have made an important policy statement and many of us feel that ... they're headed in the right direction," Turzai said. "There's aspects to the program that are too discretionary and they need (to be) reformed at a minimum."
Asked why the state couldn't keep the program while improving it, Turzai responded: "I think there's just been a history of abuse that's been shown there, and it needs further reform and further reduction."
Turzai cited audits by the state's independent fiscal watchdog, Auditor General Jack Wagner, a Democrat. But Wagner responded that he never audited the General Assistance cash benefit program and that his audits of Department of Public Welfare programs never recommended eliminating benefits.
"In all our audits, we never had a recommendation to cut a person off," Wagner said. "What we have repeatedly said is, 'you need to fix the system.' And that is a much more difficult thing to do than simply cut people off the program or cut the amount of money going to the program."
Although the cash benefit has no industry or organized beneficiary to lobby for its survival, the nonprofit Housing Alliance of Pennsylvania got involved because it found a functioning program with proper safeguards that helps people avoid homelessness until they get back on their feet, executive director Liz Hersh said.
Improvements can be made while the cash benefit program is maintained, Hersh said.
"We don't want to further victimize people who are really extremely impoverished and relying on this meager resource to pull themselves up by their bootstraps," Hersh said.
Michael Froehlich, a staff lawyer for Philadelphia-based Community Legal Services, questioned why a major policy decision was being made without hearings. In any case, eliminating the benefit could likely mean bigger costs for society, Froehlich and Hersh said.
More than 60,000 childless adults — about 60 percent men and 40 percent women, according to the Community Legal Services — get help from the program each year. They tend to spend the approximately $200 on rent, transportation or addiction treatment fees, advocates say. They can also qualify for food stamps.
Since July 1, 2010, investigations of the cash benefit resulted in 86 prosecutions that resulted in guilty pleas or convictions and 46 cases that went through a diversion program for first-time offenders, the state inspector general's office said.
The Department of Public Welfare said there are no written guidelines on how recipients can spend the money, since the state generally follows federal rules and they prohibit restrictions on the use of federally-funded cash benefits. The money is loaded onto electronic cards that cannot be used at liquor stores or casinos, the department said.
The Corbett administration argues that it has little choice but to eliminate the cash benefit if it is going to rein in the growth of welfare costs. Senate Appropriations Committee Chairman Jake Corman, R-Centre, said senators had other priorities when they were deciding which of Corbett's proposed cuts to soften.
"We obviously didn't have enough to fill every hole and we prioritized as best as we could," Corman said.
Democrats tried in a floor amendment to restore it, but it was rejected, 29-18 — with two Democrats and every Republican opposing it. -- (AP)
Losing a house to foreclosure is perhaps one of the worse calamities a family could face, but thanks to an effort by the Philadelphia Sheriff’s Office and state Sen. Anthony Williams, underwater homeowners and others facing a bank seizure of their home can now arm themselves with the proper information and resources needed to keep their home.
To that end, Philadelphia Sheriff Jewell Williams and Sen. Williams will host a free foreclosure and tax sale prevention workshop on Oct. 20 at Boy’s Latin of Philadelphia Charter School, 5502 Cedar Ave. The workshop is scheduled to begin at 10 a.m. and will run through noon.
Registration is requested to attend this event, and interested parties can do so by calling 267-385-7624 or by visiting www.SaveYourPhillyHome.com.
“When a parent loses their home because of a tax or mortgage foreclosure, it is the children who also become homeless,” Jewell Williams said in a statement released by his office. “Rarely is one thing responsible for the start of the slow slide from home ownership to serious debt, to loss of a home, which is harmful to the most vulnerable, usually the children.”
Of the topics and anti-foreclosure tactics to be discussed are loan modifications, short sales, secondary financing and financial management; the workshop will also provide individual sessions with housing counselors.
The latest data provided by the People’s Emergency Center lends credence to the necessity of workshops such as this one. According to a policy paper released in June, the PEC found that it costs the state $363 million annually when considering the 13 cost categories, which included indicators such as the cost associated with emergency housing, foster care and early intervention. According the PEC’s data, that equals roughly $41,000 per each of the more than 9,000 Pennsylvanian children who spent at least one day in a shelter in 2011, the last year in which a complete data set is available.
PEC data also shows that Philadelphia, by far, shoulders the most costs in relation to the state’s 16 other “continuum of care” regions, spending $173,050,816. The Philadelphia region is in the state’s top-third in terms of the total estimated marginal cost of child homelessness.
Pennsylvania Housing Alliance Executive Director Liz Hersh — a longtime proponent of housing equality and assisting homeowners who are underwater with their mortgage – believes community forums such as the one this weekend is necessary, and will continue the recent gains made by fair housing advocates.
“Although the worst of the foreclosure crisis is behind us, many families still face the fear and uncertainty of not being able to make their mortgage. The good news is that help is available,” Hersh said, referencing the recent refunding of the Housing Emergency Mortgage Assistance Program and the timely announcement that Pennsylvania Housing Affordability and Rehabilitation Enhancement Fund will receive $9.2 million this year to help local communities address their housing needs. “Lenders are working with owners more proactively to keep them in their homes and housing counselors are available to do the hard work of coming up with a plan.
“This forum offers homeowners a much needed help and information so they don’t have to go it alone.”
Sen. Williams echoed much of Hersh’s sentiment, and said that the debilitating effects of foreclosures will have a negative ripple effect through the community.
“We cannot expect to have safe, stable communities when the real threat of homelessness and desperation looms over families struggling to do the right thing. Houses left empty by foreclosure represent more than an individual family misfortune; they easily devolve into breeding grounds for crime. And like a cancer, this one-two punch devours neighborhoods, especially economically fragile ones already on edge,” Williams said. “That’s why this workshop and others like it are so critical. Too often, the difference between losing a home and saving it is a matter of outreach and information. So it’s essential to offer both, in a collective fashion, particularly as people continue to battle to survive in this economy.”
Corbett's action shreds safety net
Cuts to the education and infrastructure repair budgets hurt enough, but cuts to housing – which have an immediate effect on the people that need those services the most – is particularly debilitating.
“You could say it has been a series of cuts to the housing budget,” said Liz Hersh, executive director of the Housing Alliance of Pennsylvania. “Last year, our budget for this year was dramatically cut, and the governor just cut it again last week.”
Hersh said Gov. Tom Corbett lopped off about 10 percent of the budget last week, coming a year after he whittled off 5 percent. These cuts, said Hersh, will have a direct effect on several housing programs: The Homeowner’s Emergency Mortgage Assistance Program; Human Services Development Fund; Accessible Housing Program; Homeless Assistance Program and Keystone Communities, which was formally referred to as the Housing and Redevelopment Assistance program.
And these cuts couldn’t have possibly come at a worse time, Hersh added.
“I think that a lot of people are struggling, facing foreclosure, and are on the verge of homelessness with nowhere to turn,” she said. “Even the service providers in the communities are overwhelmed. It’s a shredding of the safety net.
“I guess the governor’s office is saying, ‘it’s a tough time, there’s no money,’ and they can’t afford it.”
With general budget cuts across the board, particularly to the service-providing sector, Hersh has a reason for her grim assessment.
“Foreclosures are up, homelessness is up. Fewer Pennsylvanians have homes within their reach. Having more homeless children in Pennsylvania is not an acceptable option,” she said. “These cuts will further propel the downward spiral of lives and our economy.”
Hersh and her team aren’t waiting for the state to reverse course, however. On its website, www.housingalliancepa.org, the nonprofit organization lists several resources and programs that local communities can implement to help ease the pinch caused by the cuts. It has also teamed up with The National Alliance to End Homelessness and other grassroots organizations to assist, in lieu of state government action.
Still, Hersh wonders if that will be enough to offset the deep cuts in the housing budget.
“What we are really hoping for is to show the state legislators that these cuts were penny wise and pound foolish; sometimes, you have to spend a little to save a lot,” Hersh said, noting that, if implemented correctly, the programs that were cut could actually save money for the state. “This is a very shortsighted way of looking at things, and it’s making the economy worse. We are hoping [legislators] find a way to do what’s right.”