Cuomo and Lazio Headed for Showdown in New York Governor’s Race

Current New York State Attorney General, Andrew Cuomo, and former congressman, Rick Lazio, are headed for a showdown this fall to become Governor of New York State. The inevitable showdown materialized after current governor, David Patterson, decided not to seek election for a full term. Patterson was the sitting Lieutenant Governor when then Governor Elliot Spitzer resigned in scandal. Patterson was appointed governor after Spitzer’s resignation.

Cuomo, the former Secretary of the Department of Housing and Urban Development (HUD), is the son of former governor Mario Cuomo. He has not officially announced his candidacy; however, it has been a foregone conclusion he will run for governor.

Lazio is a former Republican congressman from Long Island who chaired the House Subcommittee on Housing and Community Opportunity for six years. He helped write the Quality Housing and Work Responsibility Act of 1998 which sought to overhaul public housing laws.

Lazio has been discouraged by some leading Republican figures in the state to forego his pursuit of the governor’s seat and instead challenge New York Senator Kirsten Gillibrand (D). She is seen as a vulnerable candidate even though she has the backing of her party’s state and national leadership including President Barack Obama. Early polling shows Cuomo beating Lazio or any other potential opponent handily.

Latest Projection Calls for Significant Republican Gains in November

A new analysis by The Center for Politics is predicting Republicans can make enough gains in the fall elections to potentially reclaim control of the House of Representatives.

The analysis, the second completed in two weeks by The Center, predicts Republicans will pick up 37 seats in the House leaving it three short of the number needed to take control of the lower chamber based. The Center utilizes two different methods of analysis to make this prediction. The first includes an analysis of each individual district and making estimates based in a review of polling data, past election results, a review of the opinions of highly regarded individuals in each district and other relevant data. Based on that first analysis, the Center predicted a net gain of 27 seats.

The latest analysis is considered a more accurate predictor of the congressional races. The author is Professor Alan Abramowitz of Emory University. He uses a regression analysis which includes the following four factors:

1. The president’s net approval rating according to the latest Gallup Polls.

2. Looking at the results of generic ballot questions in the Gallup Polls.

3. He includes a dummy variable which is a plus or negative factor in mid-term year elections, plus for Democrats and negative for Republicans.

4. The number of seats held by Republicans.

The first two variables are fluid during an election while the last two are “fixed” as the election progresses. Abramowitz bases his analysis on the normal tendencies of voters to react against the party controlling the White House in the middle of the president’s first term. Additionally, he said Democrats have a large number of seats to defend because they have gain approximately 50 seats in the last two election cycles.

The Center for Politics is a nonpartisan unit of the University of Virginia started by Larry Sabato which seeks to promote the value of politics and the importance of civic engagement. It strives to encourage citizens to actively participate in the political process and government; evaluate and promote the best practices in civic education for students of all age; and, educate citizens through the Center's comprehensive research, programs, and publications. Dr. Sabato is the University Professor of Politics and director of the center which was founded in 1998. He is the author of over 20 books and countless essays on politics and has taught more than 14,000 students in his career at Oxford University, Cambridge University, and the University of Virginia. He is widely regarded as one of the most accurate prognosticators of election results in the country.

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Member Earmarks Increase According to Taxpayer Group

Members of Congress continue to take advantage of their positions on key committees in doling out Federal dollars to their constituents according to a recent report, TCS FY2010 Earmark Analysis: Apples-to-Apples Increase in Earmarks.

Taxpayers for Common Sense recently released an analysis of earmarks included in the Fiscal Year (FY) 2010 appropriations bill and found a slight increase in the number of pet projects included in the funding bill. Earmarks are set-asides included in an appropriations bill at the member’s request.

Taxpayers for Common Sense is an independent and non-partisan voice for taxpayers working to increase transparency and expose and eliminate wasteful and corrupt subsidies, earmarks, and corporate welfare.

According to their analysis, a Member’s position on the Appropriations Committee made a huge difference in the amount of money the Member of Congress was able to divert to his or her home state or district. Predictably the chair representing the party in power is bale to use that influence to provide funding back home.

Of the top recipients of earmarked funds in the Senate, eight of the top ten are Democrats and six of the top ten are on the Appropriations Committee. The amounts secured include Sen. Thad Cochran (R-MS) at the top of the list with close to $500 million to Sen. Dianne Feinstein (D-CA) who rounded out the top ten with $211 million.

In the House, The top ten recipients included three Republicans in the top five ranging from the top of the list, Rep. Bill Young (R-FL) with almost $90.5 million and the bottom of the list, Rep. James Moran (D-VA) with slightly more than $38 million.

The analysis showed that the majority party typically doles out 60 percent of the earmarks funds. Senate appropriators tend to receive approximately 48 percent of earmark funds while their colleagues in the House receive roughly 30 percent of all earmarks.

The group offers two principal recommendations for reform:

1. Reduce the number and cost of earmarks and the types of projects eligible for earmark funding. Included in this recommendation is the call for reducing the funding level for earmarks by 50 percent; banning earmarks for private or for-profit entities; disallowing earmarks in competitive or merit-based funding programs; and, establishing a term-limit on the funding of projects.

2. Increase transparency of earmarks. They recommend a centralized location where all earmarks are displayed in an easy-to-read downloadable format; include amplified budget information like the type included in the president’s budget; allow all legislation to be viewed 72 hours before it is under consideration; and creating a mechanism which allows some enforcement of compliance.

The report’s release coincides with the start of the annual appropriations process after the president released the FY2011 budget proposal. Hearings on next year’s budget have begun with Shaun Donovan, Secretary for the Department of Housing and Urban Development scheduled to appear before the House Subcommittee on Transportation, Housing and Urban Development and Related Agencies on February 23.

Senator’s Illness Raises New Concerns for Democrats

New Jersey Sen. Frank Lautenberg’s diagnosis of cancer creates another headache for Democrats as the mid-term election inch closer. If Lautenberg is unable to resume his work in office, the sitting governor, Chris Christie, a Republican, by law, will appoint his successor.

The announcement of Lautenberg’s illness comes at a time when the Democratic Party was reeling from the decision by Sen. Evan Bayh (D-IN) to retire instead of pursue another term. Democrats are expected to maintain control of both chambers of Congress after this fall’s elections; however, Republicans are expected to make significant gains seats in both chambers.

Losses of any sizeable number of Democrats could undermine that party’s efforts in pursuing its agenda in the future particularly for affordable housing programs. However, Republicans are not resting easy since Tea Party activists are challenging the party to veer further to the right and work towards reducing Federal funding across the board. Tea Party activists are expected to back more conservative candidates in the Republicans primaries. This tactic could result in a Republican candidate running for office in the fall which satisfies the desires of the party activists but is not compatible with voters in that particular district.

Home-Based Businesses Contribute to Employment and Overall Economy

Home-based businesses are becoming a growing force in the US economy and are as successful as non-home based businesses with a median household income higher than the general population, according to a research report Homepreneurs: A Vital Economic Force.

According to the Small Business Success Index (SBSI) home-based businesses account for 34 percent of all small businesses which provide more than half of the owner’s household income. According to the analysis:

- The vast majority of them, 75 percent, work full-time in their home business.

- Half have employees.

- Thirty-nine percent have between three and five employees.

- Ten percent have more than five employees.

- It is estimated that home-based businesses, homepreneurs, hire roughly 13.2 million people versus 10.4 million hired by companies funded by venture capitalists and 9.2 million hired in the oil and gas sector.

Home-based businesses are expected to increase in the next few years because of the lower start-up costs associated with home-based businesses; demographic and social shifts as home-based businesses are a viable work option; and, the lack of corporate jobs.

SBSA is a collaboration between Network Solutions and the Robert H. Smith School of Business at the University of Maryland. The index measures small business competitiveness and success looking at six key factors: access to capital, marketing and innovation, workforce, customer service, computer technology and compliance as it relates to small businesses.

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Hispanics Look to Flex Muscle in 2010 Election

A new report states the Hispanic vote can have a dramatic effect on 40 state and congressional races in the 2010 mid-term election.

The report, The Power of the Latino Vote in the 2010 Election, looks at Hispanic voting patterns from as far back as 2000 and how those votes could impact the 2010 mid-term elections. It cites numerous studies which point out immigration is a defining issue for Hispanics even the economy is identified as the community’s number one issue.

According to the report, a politician’s position on immigration reform “serves as a lens though which Latinos assess the political environment and candidate attitudes not just towards immigrants, but towards the community as a whole.”

The report was released by America’s Voice which started in 2008 with a focus on communications and media as part of a renewed effort to win comprehensive immigration reform. America’s Voice speaks directly to key audiences through the mainstream, new, and Spanish-language media, conducts cutting edge public opinion research, communications, and online campaigns, and supports courageous leaders from all walks of life who are standing up for workable comprehensive immigration reform now.

The report notes Hispanics tend to trend in voting towards Democrat; however, it reports that 40 percent of the Hispanic vote consists of foreign-born naturalized citizens who have proven to be “swing votes” in various elections. This population voted overwhelmingly for Barack Obama versus John McCain in 2008 (75% to 25%) after voting for the 2004 Democratic nominee John Kerry by a smaller margin (52% to 48%).

The report also cites a number of examples where a Republican candidate’s position on immigration is a key factor in determining the level of support he or she can expect from Hispanic voters. For example, McCain reversed his long-standing support for comprehensive immigration reform during his pursuit of the presidency. He decided to support a tougher stance calling for border security before any other reforms take place. That position hurt him with Hispanic voters. Conversely, California Governor Arnold Schwarzenegger’s support among Hispanics increased during his reelection campaign in 2006 after he supported comprehensive immigration reform.

The reports identifies 40 key state, House and Senate races in Arizona, California, Colorado, Connecticut, Florida, Illinois, Nevada, New Mexico, New York, Pennsylvania, Texas, and Virginia where the Hispanic vote can have significant impact in determining the winner. The report includes the following information to illustrate this contention:

• One in five (79) congressional districts has a Hispanic population of at least 25 percent.

• Twenty-five Republican Members of Congress represent districts with Hispanic representation at 25 percent or higher.

• In the 2008 election, approximately 10 million Hispanics voted compared to 2.5 million in 2004.

• Voter registration among Hispanics grew 10 percent from 2000 to 2008.

• Texas and Florida saw turnout increase by 31 and 81 percent respectively between 2000 and 2008.

• Hispanics saw their numbers increase in other parts of the country as well between 2000 and 2008. For example, Georgia saw a 392 percent increase in its Hispanic while North Carolina (250%), Nevada (164%) and South Carolina (157%) also saw sizable increases in Hispanic residents.

• Hispanics voted for President Obama in greater numbers in 2008 than they did for Kerry in 2004. In 2004, Kerry won the Hispanic vote by a 19 percent margin (59 to 40); however, Obama won the Hispanic vote in 2008 by a 36 percent margin (67 to 31).

• The report believes states looking to gain congressional seats after the latest Census is complete will do so in large part to the influx of Hispanics; conversely, states losing congressional seats would do worst had Hispanics not moved there.

The report also warns Democrats not to take the Hispanic vote lightly. In its conclusion, it points out that Democrats run the risk of alienating the Hispanic vote this fall if it does not pursue meaningful immigration reform.

Bayh Retirement Complicates Mid-Term Election Strategy for Democrats and Could Prove Costly for Housing Advocates

Sen. Evan Bayh’s (D-IN) decision to retire rather than pursue reelection further complicates the Democratic Party’s efforts to hold onto it majority in the Senate and leaves housing advocates with one less ally.

"Congress is not operating as it should," Bayh said at a news conference in Indianapolis, adding there's too much partisanship and "the people's business is not getting done."

Bayh, a former two-term governor, first won election to the Senate in 1998 and won reelection in 2004 with 64 percent of the vote. He joins Sens. Christopher Dodd of Connecticut and Byron Dorgan of North Dakota as Democrats choosing to retire instead of seeking re-election. Democrats now have five open seats to defend this fall where Roland Burris of Illinois and Ted Kaufman of Delaware will not seek re-election for their appointed seats.

Republicans have six seats to defend including those of retiring Sens. Judd Gregg of New Hampshire, Kit Bond of Missouri, Jim Bunning of Kentucky, George Voinovich of Ohio and Sam Brownback of Kansas. Sen. George LeMieux of Florida will not pursue re-election. He was appointed to complete the term of Sen. Mel Martinez who resigned before the expiration of his term.

His decision adds to the list of affordable housing supporters who will be leaving the Senate. Bayh was a solid supporter of affordable housing programs, according to the National Association of Housing and Redevelopment Officials (NAHRO) www.nahro.org. He voted on behalf of affordable housing initiatives 75 percent of the time according to the latest NAHRO scorecard. Of the aforementioned Senators, only Bunning voted for affordable housing programs less than 50 percent of the time according to the NAHRO scorecard.


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Evolving Politics Could Have Long-Term Implications for Housing

The evolving political situation may create an opportunity for Republicans to increase their numbers in the Senate and state houses putting them in position to control of redistricting efforts. This could result in fewer elected officials available to support affordable housing programs.

The consensus among experts who analyze elections is that there are approximately a dozen Senate races at play this November. If Republicans run the table, they will have a majority in the Senate and will be in a stronger position to exert their will on the legislative process. If victorious, they will attempt to derail any legislative initiative proposed by the president and will aggressively seek initiatives which will reduce government spending. The likely scenario will result in Republicans narrowing their numbers in the Senate. It is too early to predict the margin of difference between the two parties this fall but most prognosticators are predicting Republicans have a good chance of picking up seven seats this fall. That will give Democrats a 52 to 48 advantage over the Republicans.

Complicating matter for Democrats is that they are getting hammered from every constituency within their tent. The combination of a struggling economy and concerns about the long-term debt of the nation is causing Democrats to lose independent voters. These voters typically consist of working class individuals with little to no college education who tend to be conservative on fiscal, cultural and foreign policy issues. Liberals are upset the president has not been more aggressive in pursuing a public option in health and ending the wars in Iraq and Afghanistan. African-Americans are upset that not enough stimulus dollars has filtered into their communities to help reduce their high unemployment rates. Gays want the president to demonstrate stronger support for gay marriage. Hispanics want immigration reform and believe failure by the Democrats to address this issue will result in less support within the Latino community.

For supporters of federally-funded housing programs, the fewer Democrats elected to Congress, the harder to gain support for additional funding for affordable housing programs. (Democrats tend to be more supportive of providing Federal funding for housing programs.) In the Senate, every Senator with the exception of Evan Bayh of Indiana and Claire McCaskill of Missouri have scored 100 percent on issues related to affordable housing according to the National Association of Housing and Redevelopment Officials (NAHRO).

With a few exceptions, a majority of the Senate seats with competitive races are held by senators with perfect scores according to NAHRO. They are Arkansas (Blanche Lincoln); Colorado (Michael Bennet); Illinois (Roland Burris); Nevada (Majority Leader Harry Reid); and, Pennsylvania (Arlen Specter). In Connecticut (Chris Dodd) and North Dakota (Byron Dorgan), Democrats are trying to hold seats vacated by retiring members who each scored 100 on NAHRO’s score card.

In Delaware, it was widely assumed that Beau Biden, current Attorney General for the State of Delaware and son of Vice President Joe Biden, would “inherit” his father’s seat after the elder Biden’s selection as President Obama’s running mate. However, his decision to remain in his current position leaves the race wide open for the state’s House Representative Mike Castle (R) to win. Castle is a moderate Republican who has been a strong supporter of affordable housing programs. He has voted 83 percent of the time in NAHRO’s assessment of his voting record in support of affordable housing programs.

In Indiana, Evan Bayh (83%) could face a tough reelection race as former House Representative Dan Coats is making waves to run for that seat. In Missouri, long-time housing supporter Kit Bond (67%) is retiring which is unfortunate for housing advocates. Bond has oftentimes been the lone Republican offering vocal support for Federal housing programs and had an outstanding working relationship with his colleague on the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies, Sen. Barbara Mikulski (D-MD).

In Florida, Kentucky, Louisiana, New Hampshire, and Ohio both parties are battling over seats being vacated by Republicans. Of the aforementioned races, Democrats are expected to lose in Arkansas, Delaware, Nevada, and North Dakota. Democrats are also at risk of losing in Colorado, Illinois and Pennsylvania. It is only February and the elections are nine months away, an eternity in politics. However, if the election were held today, Democrats would probably lose seven seats. Of the seven new Republican senators under this scenario, only one, Castle, can be expected to be supportive of Federally-funded affordable housing programs.

According to Charlie Cook of The Cook Political Report, the road may be tougher for Democrats in 2012 and 2014 when they have a total of 43 seats to defend. According to Cook it is not unrealistic to expect a Republican take over of the Senate in the near future.

Governors Races will Impact Redistricting

While much attention is being paid to the impact Election Day will have in Congress races to control governor seats is flying under the radar. Controlling the state houses will impact who redraws congressional lines when redistricting decisions are made. It is not unreasonable to expect the gains reaped in Congress by Republicans will filter into the races for governor and control of state legislative bodies. Larry Sabato, Director of the University of Virginia’s Center for Politics, is predicting Republicans will gain six governorships in 2010 with the potential to gain three more.

According to Stateside Associates there will be 46 states holding legislative elections with Democrats currently holding 61 out of 99 chambers. Controlling state government places the controlling party in position to influence redistricting decisions. New lines will be drawn after the 2010 census is completed. With the exception of eight states, the governor is directly involved in the redistricting process. Governors either have veto power over final redistricting plans or they appoint the commissions designed to redraw congressional lines.

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HUD Budget Offers Opportunities for New Initiatives

President Obama’s proposed 2011 budget could single a shift in the way future housing assistance is provided to low-income families as it seeks to encourage a regional approach to providing tenant-based rental assistance. This approach could portend how the Department of Housing and Urban Development (HUD) will fund future initiatives to local communities.

The budget proposes a new initiative which seeks to implement the first phase of a multi-year effort to increase tenant mobility and access to assistance. The Transforming Rental Assistance (TRA) Initiative will allow a limited number of housing authorities adjacent to one another to combine the administrative functions of serving vouchers to eligible families. The intent is to create a “regional entity” designed to allow for increased mobility in the use of the voucher and access to greater housing options for the family receiving assistance. The administration expects to introduce legislation in the spring to give it the legislative authority to carry out this initiative. The administration is promising to enter into long-term property-based rental contracts with the authorities if the “mobility” or regional approach is part of the agreement. In the accompanying HUD documents, the department contends this will eventually result in “a uniform funding stream, governed by a single set of rules and regulations.”

Housing authorities can currently seek approval from HUD to convert public housing units to vouchers without the mobility component. HUD has been very hesitant to grant the conversion. There are stricter rules governing the public housing program. The voucher program is easier to administer, generates fees for the PHA and can be used as an incentive for public housing residents to pursue self-sufficiency initiatives.

This approach has been advocated by low-income housing advocates for years. This approach is centered on the notion that a regional approach eases the burden on the administrative agency and the family seeking housing. There isn’t enough evidence to suggest a regional authority increases housing opportunities for voucher holders. However, jurisdictional issues and the cost implications for an agency when a voucher leaves its inventory do warrant additional review and adjustments.

It is early and more details about the initiative need to be reviewed; however, given the current political and economic climate, this could gain the necessary support to be enacted into law. There will probably also be a few housing authorities which will reach agreement with HUD to test this initiative. Our guess is HUD will be very accommodating to these agencies.

The budget also includes $1 billion for the Housing Trust Fund although the accompanying documents do not include a source of funding for the initiative. According to the budget documents, HUD will propose a source of funds from outside of the appropriations process. The Trust Fund was enacted as part of the Housing and Economic Recovery Act of 2008.

Overall, the balance of the president’s submission is fairly straightforward:

1. The budget proposes $41.6 billion for HUD which is approximately $2 billion below the FY 2010 level. It does assume an additional $7 billion will eventually be available to the department from the receipts earned by the Federal Housing Administration (FHA) and Ginnie Mae.

2. The public housing capital fund will receive slightly more than $2 billion in the 2011 budget submission which is approximately % billion below the FY 2010 level. The administration sights the distribution of $4 billion in stimulus funding to justify the reduction.

3. The administration is proposing $4.8 billion for the public housing operating fund which it claims will meet 100 percent of the costs of running a housing authority.

4. The administration decided not to fund the HOPE VI program instead opting to ask for $250 million for the Choice Neighborhoods Initiative. This is significant because housing authorities must compete for funding under the Choice initiative with local governments, non-profits and for-profit entities. Under the HOPE VI program, housing authorities competed with other housing authorities for funds.

5. The proposed budget includes $17.3 billion for Section 8 tenant-based assistance. The budget does include an increase in administrative fees, calling for $1.7 billion, an approximate $200 million increase over last year’s budget.

6. The budget includes $9.3 billion for project-based assistance, $400 million of which will be available in FY 2012.

7. The budget includes $4.45 billion for the Community Development Block Grant (CDBG) program which includes $3.99 billion for the formula and the balance in set-asides.

8. Included as a set-aside within CDBG is $150 million for the Sustainable Communities Initiative which are grants help regional panning efforts to integrate transportation and housing initiatives.

9. Another set-aside is a new program called the Catalytic Investment Competition Grants which will be designed to provide gap financing for a variety of local economic development activities. The grants are expected to ignite economic activities in distressed communities.

10. The budget also proposes $25 million to fund the University Community Fund. These are grants which are designed to spur economic development activities in communities near universities.

11. The budget proposes $1.65 billion for the HOME program.

12. The budget proposes $2 billion for Homeless Assistance Grants.

13. The budget eliminates funding for the Brownfields Economic Development Initiative and the Section 108 Community Development Loan Guarantee Program.

14. In a surprise, the department also proposed suspending funding the Sections 202 and 811 programs. The purpose is to restructure the programs to make them more efficient.

Former HUD Secretary to Run for Governor of New York

Former HUD Secretary Andrew Cuomo, currently the Attorney General for the State of New York, is expected to run for governor and challenge the incumbent, David Patterson, in the Democratic primary according to several news reports. Several reports state he has more than $12 million for a campaign versus $600,000 for the incumbent David Patterson. Cuomo is heavily favored to defeat Patterson in the primary. For Congressman, Rick Lazio, who chaired a housing subcommittee during his tenure in the House of Representatives, is running to seek the Republican nomination for governor. Lazio is the principle author of a 1998 public housing reform bill. Assuming Cuomo wins the Democratic nomination, observers expect him to easily defeat his Republican opponent.


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