PUBLIC HOUSING OPERATING COST STUDY

PUBLIC HOUSING OPERATING COST STUDY

HARVARD UNIVERSITY GRADUATE SCHOOL OF DESIGN

Final Report

June 6, 2003

Prepared for the U.S. Department of Housing and Urban Development

Prepared Under a Cooperative Agreement with:

Office of Public and Indian Housing U.S. Department of Housing and Urban Development Cooperative Agreement K-PIH-99156

Authorized by:

Conference Report of the 1999 HUD Appropriations Bill United States Congress

Public Housing Operating Cost Study Staff:

James G. Stockard, Jr., Principal Investigator Gregory A. Byrne, Project Director Kevin Day, Senior Research Analyst Gretchen A. Maneval, Senior Research Analyst Lora A. Nielsen, Project Coordinator Katherine James, Staff Assistant

Cost Study Senior Advisors:

Phillip L. Clay, Senior Protocol Advisor Jeffrey K. Lines, Senior Public Housing Advisor Georgia Murray, Senior Private Housing Advisor

Acknowledgements:

The following individuals have made particularly valuable contributions to the Cost Study:

Glenn French of G.L. French & Associates Leonard Jones of JMA Consultants Jill Khadduri, James Wallace, Rhiannon Patterson, and Ken Lam of Abt Associates, Inc. Paul Lambert of Lambert Advisory

Eric Richelson of Richelson Enterprises

Jan Shapin of Jan Shapin and Associates Judith Weber of Viva Consulting Charles S. Wilkins of The Compass Group, LLC

The following individuals have also made significant contributions to the Cost Study:

Wim Bos, Thomas P. Costello, Yves Dyoko, Reese Fayde of Reese Fayde & Associates, Robert E. Given, Jr. of Altman Management Company, Joan C. Howell of the Public Housing Management Institute, Eugene Jones, Langley C. Keyes of MIT, Casimir Kolaski of Kolaski Housing Advisors, Inc., Richard Moore and James K. Stephenson of Stephenson and Moore, Inc., Edward H. Marchant, Rebecca Matheny, Art Milligan of A.S.M. Development Group, Inc., Miguel Morales of M.A.C. Computer Consulting, Inc., John F. Washek of Edgemere Consulting Corporation, Ned Epstein and Eleanor White of Housing Partners, Inc., Anker Heegard and Linda Ose of The Compass Group, LLC, Karlynne Tucker-Scaggs of Advanta Management Group, Nathaniel Nichols of The Corcoran Companies, Mark Kellenbeck of Kellenbeck Property Management, Kathleen Lin of Blinking Light, Claudia Brodie of McCormack Baron Management Services, Inc., Robert F. Prettyman of Mercy Services Corporation, LLC, James Jameson and David Landers of Systems Engineering and Management Corporation, Ken Talle of Thies and Talle, Paul Votto of Westbrook Management, Robert D. Cruz of Washington Economics Group.

GSD would also like to recognize the assistance of the following groups:

Research Working Group members: Sheila Crowley, Thomas Deller, Steven Fischer, Andrea Hartt, Dunshaw Hockett, Phil Holman, Mamie Jackson, Joy Johnson, Larry Loyd, Betsey Martens, Anthony O'Leary, Mary Rone, J. Richard Parker II, William Steinmann, Paulette Turner, Edward Williams, Alexander White, and the many guests who attended the meetings to offer their insights.

Industry Advocacy organizations, with special thanks to Timothy Kaiser and Ted Van Dyke of PHADA, Sunia Zaterman, Debbie Gross and Marlene Kalenak of CLPHA, and Christine Siska and Jonathon Zimmerman of NAHRO.

GSD would further like to express its appreciation to the following public housing authorities for their time and assistance:

Altoona Housing Authority (PA), Akron Housing Authority (OH), Anne Arundel Housing Authority (MD), Athens Housing Authority (GA), Boulder City Housing Authority (CO), City of Reno Housing Authority (NV), Dayton Housing Authority (OH), Gloucester Housing Authority (MA), Hampton Redevelopment and Housing Authority (VA), Housing Authority of the City of Baltimore (MD), Houston Housing Authority (TX), Jacksonville Housing Authority (FL), Jamestown Housing Authority (RI), Kansas City Housing Authority (KS), Kingston Housing Authority (NY), Laurinburg Housing Authority (NC), Los Angeles Housing Authority (CA), Marble Falls Housing Authority (TX), Norfolk Housing Authority (VA), Phoenix Housing Authority, Pinellas County Housing Authority, Portland Housing Authority (OR), Providence Housing Authority (RI), San Antonio Housing Authority, Springfield, MA Housing Authority, as well as the many housing authorities who participated in field test site visits.

The Cost Study would also like to thank GSD Dean Peter Rowe and the GSD staff, with particular thanks to Russell Sanna, GSD Associate Dean for Administration and External Relations, for his creative and unwavering support.

Finally, GSD would like to thank the many members from HUD's Offices of Public and Indian Housing, as well as the Office of Policy, Development and Research, particularly Stephen Sprague and Regina McGill, for their assistance with many aspects of this project.

TABLE OF CONTENTS

Executive Summary

1. Model Development

2. Model Estimates

3. The Public Housing Regulatory Environment

4. The Public Housing Operating Environment

5. Field Testing

6. Utilities

7. Program Reforms

Appendices

A. Model Documentation B. Application of the Cost Model to Puerto Rico Public Housing C. Internal PHA Asset Management D. Model Estimates, by Agency E. Model Estimates, by Property F. Non-Profit Survey G. Case Study Field Notes H. Changing Public Housing's Regulatory Environment I. Survey of Mixed-Financed Operating Costs J. Private Management Reports K. Budget-Based Field Test Reports

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