New Orleans   

Orell Fitzsimmons, field director for Local 100, sitting in the meeting with a number of our leaders from Head Start units at Gulf Coast and Avance, who knew how little had been done to inform and enroll the children – and parents – they serve, had an excellent line for the Comcast representative.  He informed Comcast clearly that, “We are not a faith-based organization.  We can’t take your word on how well you think you are doing.  We have to know the facts and the real numbers.”  Fitzsimmons later told me he even quoted Ronald Reagan at one point from the old SALT missile days, and told Comcast we would need to be able to “verify.”

Maybe we weren’t hearing correctly, but the Comcast VP – they all seem to be VPs – seemed to be saying “make me!”  Furthermore he seemed to be insinuating that only the FCC could make them produce the numbers.  If that’s the case, then that’s where we will have to go to make this program work, if Comcast won’t live up to its promises.

On another front there was a report on possible progress for some of the homeowners facing foreclosure.  The story, as always, was disconcerting when it came to the codependence of the feds with the banks.  HUD secretary Shaun Donovan seemed to be wheeling and dealing to buy off different states to accept a deal which would reduce mortgage levels by a small number (the Times reported $20,000 per mortgage, which is a trickle in many communities), and tried to buy off California’s AG with a disproportionate share of the settlement.  Luckily, it appears that a number of the state attorneys generals are hip to the fact that the banks only real interest seems to be a “get out of court free” card from them, which Donovan and the feds seem more than willing to help facilitate.  Fortunately for many struggling homeowners a number of AGs are insisting that they will not waive their right to sue for the banks shenanigans.

At this point given how long suffering many homeowners have been and how many have already lost their houses, we all ought to hope for real justice, since clearly the time for a quick fix is long gone.

New Orleans

It’s something, I guess, but it’s not much, and it certainly doesn’t address the real crises for families facing foreclosures or the desperate shape of the home housing market.  In fact all of the flaws in the existing programs that have been terrible failures are carried forward in this latest “initiative.”

The program is based once again on a “voluntary” set of agreements with banks.  The mortgages under discussion would all be Freddie Mac and Fannie Mae qualified.  The loans would all have to predate a fixed date in 2009.  The last six payments for potentially eligible refinancers would have to have been paid timely and successfully.

The new program, like all of the old programs, continues to be a boon for the bankers and mortgage holders because once again nothing is being done to right size the outstanding market value of the home with the stated value of the original mortgage amounts.  For some people this new program might save them some money on their monthly payment, but may not change the fact that the homeowners might be crazy to continue to make payments on a home that will never recover the original loan value in their lifetimes.

HUD and the President’s continual unwillingness to facedown the bankers and reduce the outstanding balances in order to bring mortgages holders back to dry land from the underwater deep sea where so many sit especially in Florida, Arizona, Nevada, and other areas where real estate values have totally tanked.  This program continues to look, feel, and taste like a bank bailout footnote, rather than a homeowner relief effort.  Banks are still trying to pretend their portfolio is intact despite all of the evidence to the contrary.  The Administration has become codependent on this crazy strategy by encouraging refinancing at false values to help the banks and allowing them to make some fees, even though less, on the deal.

This is a rope for homeowners, not a lifeline, and without reconciling loan amounts to real values; it could be a hanging noose rather than any kind of salvation.  Eventually someone somewhere in this Administration is going to have to give homeowners and their beleaguered communities some relief by embracing reality rather than continuing to finance the pre-recession fantasy.

New Orleans

Even though it is not important or much of anything, unfortunately, other than another press conference, it would seem.

This announcement and program cost no money.  Remember Congress in the original bailout set aside $46 billion for foreclosure modification supposedly to help 3 to 4 million homeowners facing foreclosures.  Months and years go by…tick-tock, but so far only $2 billion has been spent in this regard and only about 730,000 have won permanent modifications.

Of course a homeowner would have to be eligible, and eligibility is determined by the banks and servicers, and of course their participation in this program like all others is “voluntary,” and don’t forget that eligibility could also be impacted by other regulatory requirements or investor restrictions.  Make no doubt about it, it is much easier for a rich man to get into heaven, than for a poor working – or unemployed –  stiff to get a loan modification under HAMP.  That was true before, and it is just as true now.

This new “program” is a mandatory extension.  Mandatory though fits in the same sentence with voluntary participation and arbitrary, discretionary management of the “program” by the banks and their servicers with virtually no federal supervision or accountability.

Next month, HUD and the President are going to announce another new program.  In this one foreclosure victims will have a “pray for the files” day, where they pray that their foreclosure files will be lost yet again by the banks and servicers.  This is a prayer that statistics would establish is virtually a sure thing, and when assisted, advocates almost always find that this happened somewhere along the chain.

The month after that HUD and the President are going to announce another new program.  This one will be a raffle held on “Modification Mondays” throughout September.  Any homeowner whose name is drawn on Modification Mondays will win a review of their foreclosure case, which will guarantee a six month forbearance on their foreclosure.

Eventually, maybe they will run out of ideas for fake programs and press conferences and really create a mandatory program that is run by the government, spends the money allocated, and guarantees real relief for homeowners facing foreclosures.  Not yet obviously, but hopefully some day in our lifetimes.

Laramie

Maryellen Hayden, a warrior who ran the Pittsburg office of ACORN for years, posted a couple of notes on my Facebook wall ranting about the 2^nd Circuit Court of Appeals overturn of ACORN’s successful injunction at the federal district court level of the Congressional crazy stampede that produced the ACORN Defunding Act in the wake of the pimp-prostitute mess last fall and the general partisan hating on ACORN that had been unremitting for a year.  I had posted a Times printing of an AP story.  Maryellen’s comments seemed to be saying that the appeals court had essentially decided to reject the lower court decision because the punishment of ACORN was de minimus – not significant – because only 10% of ACORN’s funding originated with the feds.  So, I thought, what the heck, I’m stranded in Wyoming chomping at the bit to drive home, I should be at the office early tomorrow, instead here I am, so the least I can do is buckle down and read the decision and see if I can throw some light out there against the dark forces.

So I read the decision this morning with a lot of head scratching.  Several observers have pointed out that the appeals decision was decided 2-1 on a Republican versus Democratic split, and there may be good reason to do so, because a lot of the decision seems more “political” than legal.  Inevitably this will arise when so much of the decision is based on the Appeals Court’s avowed intention in many parts of the writing to parse the degrees of punishment to determine whether or not they can be called “unconstitutionally punitive.”  In that sense Maryellen is right that they certainly cite that suspending 10% of ACORN’s funding should not have been a “death blow.”

The Appeals Court’s error here is both substantive and paradoxical.  In the opening arguments of the decision the judges reject the government’s attempt to pull the Department of Defense and Office of Management and Budget out of the case by arguing that it was irrelevant if ACORN never had or never would apply for funding from the DOD, and it was irrelevant if OMB had tried to paper over its initial instructions when the original injunction was overturned, because the “reputational” damage to ACORN was substantial and enduring from both the OMB and DOD actions.  Word!  But, then the judges, pages later, retreat to hide behind the “10%” screen.  Regardless, the definition of punitiveness is inherently subjective, and here the judges want to have some credibility by pretending that ACORN’s problems were all self-inflicted and that the Congressional action was prudent rather than punitive.

The judges pile a lot on the molehill of a relatively recent decision (cited several times) in which HUD has made a determination that that New York Acorn (as they call it) is a separate corporation and not related to ACORN, therefore it could now receive funding from New York State to NY Acorn under a contract that was funded by HUD.  Frankly, all of this is so confusing and contradictory that even rereading the sections of the decision several times, I felt befuddled, which still leaves me in better shape than the judges who I believe allow their handling of this corporation to be slickly deceiving and deliberately intellectually dishonest.  The description provided in the decision of New York Acorn is of the New York ACORN Housing Corporation.  I had heard that NYAHC had been renamed (rebranded?) as MHANY (Mutual Housing of ACORN New York) Management, Inc.   The actual cover page of the decision acknowledges that the name change has occurred from NYAHC (which I think they misstate with the “c” as company rather than corporation, but who cares since facts don’t seem to matter here) and is now MHANY Management, Inc., but from that point on in the text of the decision the judges simply lump all of this post-facto (after the defunding decision) survival mode activity into something they call “New York Acorn.”  By doing so they are then allowing themselves to pretend that something that was always a separate and distinct corporation in New York State is the same as ACORN, and therefore its ability to slip the noose and access the NY State funding makes this all hunky-dory.  That’s just wrong!

Furthermore I would bet money that the facts, by which I mean the politics and not the law, undermine that as well.  A New York Times story some months ago documented clearly the difficult problems that ACORN’s new management had in navigating the old New York relationships with officials in the Obama Administration.  Shaun Donovan, the head of HUD, always had a close and productive working relationship with Ismene Spiliotis, the head of NYAHC and the head of MHANY Management, Inc dating to his time as a New York housing czar.  In the story it was painful to read how Ismene, who was always a great ACORN staff member and manager and widely acknowledged to be one of the best nonprofit housing developers in New York, was being victimized by the fact that one of the primary gotcha tapes from the pimp-prostitute mess was right under her nose involving a housing counselor for NYAHC.  As the saying goes, “all politics is local,” and a wrong was finally righted by restoring justice in New York that the kangaroo court of media and the Congress had not allowed earlier.  A restoration of that kind should not be a justification for the Appeals Court though, espcially so long after the fact.

All of this is the tendency of the decision throughout which is a not so subtle attempt to simply “blame the victim” for the unconstitutional actions of Congress by applying ambiguous standards to ACORN that would be unacceptable to any other corporation or entity.  If one reads this decision one thinks that ACORN has been convicted of fraud, financial misuse and misappropriation, and any number of crimes, none of which is true, yet all of which are used by the Appeals Court to justify allowing the defunding of ACORN.

The majority judges also cite in a number of instances what they call ACORN’s “admissions of significant mismanagement.”  None of this is cited or referenced of course, and being a pretty close follower of this story, and quite frankly, for 38 years as Chief Organizer, probably the principal manger here, I read all of this with an eagle eye.  The judges only cite the fact that there have been “reports” (largely overheated, inappropriate, and inaccurate) that the ACORN “family” of organizations involved more than 200 different corporations, which must hardly bring a nod from most corporate heads given the common practice of separating real estate and development projects and nonprofit versus tax exempt organizations into separate corporations and is hardly illegal much less suspect.  They don’t like the fact that the structure and relationships were “complex.”  If they had asked me (which no one anywhere ever has) I would say that we structured the organization smartly from jump and that recent events have proven the rightness of that strategy and the mistake of not holding the line and protecting the walls between various entities.

As for these so-called “admissions of significant mismanagement” in fact where are these admissions and what might they have been?  Obviously Bertha Lewis, who emerged in the year after I resigned under the new title of “chief executive officer” would promise to do things differently, nail down any loose boards, and tighten any wobbly screws.  Frankly, that’s what all new managers do when they replace someone, either with a deft touch or a loud scream.  It was hard for me to ever take personally.  It’s part of the common politics of transitions, and hardly an admission of “significant mismanagement,” nor given Bertha and her teams long history in ACORN’s management would there ever be a credible “admission of significant mismanagement” unless there was a suicide pact to self destruct their own credibility and ACORN itself.

My best guess would be that the judges are relying on the botched, discredited, confidential, slapdash hack job done by attorney Beth Kingsley and commissioned during the upheaval of new management being selected amid the internal power struggles involving the board and staff about the control, direction, and resources of the organization in the months after I resigned.  And, they are certainly relying on that less than the repeated references to it after it was leaked by members of the rump ACORN 8 caucus to the New York Times as they tried to advance their leadership coup.  Probably the only thing the ACORN 8 ever did that I had to agree made sense was attempt to censure Kingsley for unprofessional and ethical violations before the DC bar, though unfortunately they were doing the right thing for the wrong reasons.  Kingsley was overmatched for the job and out of her arena by hundreds of miles, and wrote a political document relying on an embittered, alienated, and disillusioned staff member, that basically offered hip shooting opinions and allegations to cover up any substantive examples of problems or mismanagement other than to say that it was too complex for her and she didn’t like it. (Wade, what did you really think of that “report”? I thought even some of the “and’s” and “the’s” were lies!)

But, who knows, since the bottom line is that the Appeals Court judges just continue the allegation walking on whatever thin ice is beneath them, yet it’s substantial, since they use it to cover the heart of the crime here:  “Although the appropriations laws may have the effect of alienating ACORN and its affiliates from their supporters, Congress must have the authority to suspend federal funds to an organization that has admitted to significant mismanagement.”  By doing so the judges exercise their political will beneath the judicial screen by essentially arguing that even if Congress erred, ACORN asked for it.  That’s a dangerous legal precedent for the future if allowed to stand.

Yet, it will probably be allowed to stand as poorly reasoned and as erroneously based.  I wouldn’t bet on the Supreme Court being willing to hear the case in the future, and I certainly would never bet on the odds of justice at the hands of the Roberts’ court in the future.

This may be a sorry ending, but it is likely the ending of the last legal lifeline for ACORN.

Baltimore

I would think our conservative friends who often try to claim they are big defenders of the U.S. Constitution, would be twisting in front of their computer screens a bit on this situation.  The bar on “bills of attainder” in the Constitution is clear that any single entity or organization could not be politically singled out and punished without rhyme or reason without investigation or trial or particulars, but just in the herd reaction of a crowd in a theater hearing the shout, “fire!”  This is an obvious and critical protection of the rights of speech and association in the Constitution where the bright line tests and protections against political whim and vengeance are as fundamental as one can imagine.  Yet, to their shame we saw scores of Democrats and Republicans lined up to tar and feather ACORN without trial or charge or usually a clue.  It is hard to forget that in pure political expediency the President, a former constitutional law teacher for crying out loud, joined the lynching mob in giving cover to these scurrilous attacks, which continue even as the Justice Department tries – unsuccessfully – to overturn Judge Gerson’s ruling.

The AP summary might be easier to handle than the actual decision:

The judge…wrote that it was “unmistakable that Congress determined ACORN’s guilt before defunding it.” She said Congress is entitled to investigate ACORN but cannot “rely on the negative results of a congressional or executive report as a rationale to impose a broad, punitive funding ban on a specific, named organization.”

She said the Code of Federal Regulations establishes a formal process for deciding when federal contractors can be suspended or debarred. She added that “the existence of these regulations militates against the need for draconian, emergency action by Congress.”

What a tragedy!  But I doubt that members of Congress or the Administration will lose too much sleep over any of this.  They need to worry about saving earmarks and a couple of perks for businesses in their district, right?  Who really cares about the fate of an organization of lower income people and the impact of its eradication on the ongoing struggle for equity and justice?

The poor  will always be with us right?  And, we will always have people in power who will guarantee just that Biblical promise and do so, as it turns out, without a second thought.

New Orleans

This is going to be a mess and the finger pointing will be hard, but probably not productive.  Ex-Governor Kathleen Blanco (D) had been doling the money out on an installment basis as various rebuilding steps were completed.  This was painfully slow and rightly occasioned huge complaints and delayed recovery because the bureaucracy, subcontracted out to private vendors, was hopeless and inefficient.  George Bush’s HUD muscled up Blanco so that finally homeowners got upfront, complete grants to rebuild.

The original homeowner signed a covenant with the state that gave them a fixed period of time to get the work done.  Some may have sold their lots, taken the money, and run.  It is unclear that the covenants are enforceable on anyone but the original owner, who is likely a long gone pecan.

Given the Great Recession and everything else that is happening there could be lots of valid reasons for a lack of progress.  Unemployment would be one, but the enduring credit crunch is likely another even in the relatively more well to do area of Lakeview because in most cases homeowners were still unlikely to have cobbled together enough to rebuild at current costs for labor and materials.

The Times-Picayune quoted the LRA director saying they were focusing on “case management,” meaning that they were trying to work with people rather than gin up the legal machinery to try and get the money back.  Despite the good service the Beacon of Hope people have done here, it seemed in the paper that they were both angling for a state contract to monitor compliance and advocating a “get tough” policy with rigid timelines.  Someone needs to be keeping up with the number without a doubt but to me this situation – and the recovery itself – needs a “get smart” policy more than a “get tough” program.

Homeowners can ask for extensions of one, two, or I suspect more years for good faith and good effort.  The state can pick out one or two scofflaws among the posh Lakeview crowd to send a signal about being serious, but it will take a calm voice and steady hand to help and maybe even more than that to bring people back to the neighborhoods and New Orleans in this economy, and that’s the best prescription for success now.

Fair and affordable housing is the threshold issue for creating increased racial diversity in communities, schools, and other institutions. The historic role of federal housing finance institutions in actually enabling and allowing racially restrictive and discriminatory covenants by financing the construction of huge suburbs particularly the Levittowns in Long Island and outside Philadelphia, which became the gold standards for suburban development, is one of the shameful chapters of government assisted racism in the 20th century. This settlement could be precedent setting, particularly if HUD gets on the stick and uses some of these terms as templates for other suburbs.

[Incidentally, I recommend highly a new book by Thomas J. Sugrue, The Sweet Land of Liberty: The Forgotten Struggle for Civil Rights in the North. Not only does Sugrue do an excellent job of looking at competing visions for suburban development between Levitt and developers willing to prove that suburbs could work that were also integrated, but he also does a good job at raising up other activists that broke hard ground in the North, even while the South was seen as the more fundamental battleground for racial equity. His balanced treatment of welfare rights organizing was a bonus in this package, especially his sensitive and respectful handling of some of the indigenous leaders of welfare rights in Boston and Philadelphia, especially Roxanne Jones, who becomes an iconic, bridging figure in Sugrue’s work. Thanks to Professor Bob Fisher at University of Connecticut School of Social Work in Hartford for bringing this volume to my attention as soon as it came out.]

The key handle in this lawsuit cum settlement is one that bears some quick, strategic research by those of us committed to equity issues as well as union organizers with an eye to finally recapturing residential construction. Westchester County had reflectively signed block grant agreements for CDBG funds without making any efforts to in fact assure that steps were being taken to desegregate and ensure fair housing. The manipulation and false application of Community Development Block Grant (CDBG funds) has been a scandal for years that no one has wanted to understand or investigate, and is therefore a huge opportunity for community organizations and organizers to turn the tables fundamentally.

This excerpt from the Times article by Sam Roberts on the settlement spells it out clearly:
“The lawsuit, filed under the federal False Claims Act, argued that when Westchester applied for federal Community Development Block Grants for affordable housing and other projects, county officials treated part of the application as boilerplate — lying when they claimed to have complied with mandates to encourage fair housing.

A Westchester official originally dismissed the suit as “garbage.” But the county was largely repudiated in February when Judge Denise L. Cote ruled in Federal District Court that between 2000 and 2006 it had misrepresented its efforts to desegregate overwhelmingly white communities when it applied for the federal housing funds.

Judge Cote concluded that Westchester had made little or no effort to find out where low-income housing was being placed, or to finance homes and apartments in communities that opposed affordable housing.
As part of Monday’s agreement, the county admitted that it has the authority to challenge zoning rules in villages and towns that in many cases implicitly discourage affordable housing by setting minimum lot sizes, discouraging higher-density developments or appropriating vacant property for other purposes. Westchester agreed to “take legal action to compel compliance if municipalities hinder or impede the county” in complying with the agreement.”

Let’s get busy!