Decades of Dysfunction: Restoring Accountability at HUD
House Financial Services Subcommittee on Oversight and Investigations
2025-04-08
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Source: Congress.gov
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Good morning, the Subcommittee on Oversight and Investigations will come to order. Without objection, the chair is authorized to declare a recess of the committee at any time. This hearing is entitled Decades of Dysfunction, Restoring Accountability at HUD. Without objection, all members will have five legislative days within which to submit extraneous materials to the chair for inclusion in the record. I now recognize myself for four minutes to give an opening statement. Today's hearing is entitled, again, Decades of Dysfunction, Restoring Accountability at HUD. I would like to thank the Acting Inspector General for being here today to discuss persistent waste, fraud, and mismanagement at Department of Housing and Urban Development. For decades, HUD's IG has investigated, uncovered, and highlighted severe deficiencies plaguing the agency. HUD's core mission is to provide safe and affordable housing. something very, very important, and it's something we all support on this subcommittee. However, HUD continues to very often waste taxpayer funds while failing to meet its most basic responsibilities and has little to no mechanisms to track and report these issues. This is a fact. Year after year, HUD's appropriations are squandered, mismanaged, or lost through fraud and improper payments. In 2017, $1.7 billion was lost through improper payments and there's no evidence to suggest anything has been corrected or improved. Accountability is in short supply and a lack of transparency has eroded public trust. Yet HUD spending increased from 45.4 billion to 78.4 billion from 2021 to 2024. Unfortunately, HUD's failures extend beyond the risks of fraud and its inability to track and report improper payments. The agency relies on outdated IT systems, some designed and built in the 1970s, and in turn lacks the data collection processes required for effective oversight.
When I served in Pennsylvania as the revenue secretary, we modernized our IT systems, and the improvements in tax revenue were so significant, people actually asked what we were doing differently. How were things improving so much? It wasn't magic. It was better data, better oversight, and better decision-making. While HUD faces many challenges, its minimal oversight of programs and grantees also raises serious concerns. Requiring grantees to have a fraud prevention plan as part of the grant application, along with enforcing enhanced data sharing across HUD programs, would be beneficial steps towards achieving a more efficient and accountable HUD. Public housing authorities under the supervision of HUD have operated unchecked and without consequence. Many routinely fail to meet basic HUD quality standards with no commitment to improving operations. Requiring such PHAs to timely and accurately report overpayments should be a condition of their funding. Republicans want HUD to provide the most effective housing for Americans as possible. Fraud and overpayments take valuable dollars away from that mission. One thing is very clear. HUD cannot continue on its current path. Things need to change. That's why I sent a letter to the GAO asking for a report on HUD's improper payments and fraud risk management structure. I believe that with President Trump's DOGE committee, proper congressional oversight, and Secretary Turner at the helm, a new day at HUD is soon approaching. I yield back. The chair now recognizes the ranking member of the subcommittee, the gentleman from Texas, Mr. Green, for four minutes for an opening statement. Thank you, Mr. Chairman.
I thank the witness for appearing, and I will add for the record I have great respect for this witness and will enjoy hearing his testimony. Mr. Chairman, I have received a memo dated April 3rd, 2025. This is from the majority, and I'll read in part what it says. says this hearing will underscore the critical need for congressional oversight and review by the Department of Government Oversight and Efficiency, DOJ, to ensure transparency, accountability, and operational effectiveness within the agency. I regret to inform my colleagues first that DOJ is not a department. It is not. Doge is an entity that replaced another entity that was created by President Barack Obama. It's an administrative agency at best. Doge, which is headed by a temporary employee, Mr. Elon Musk, temporary because he's there for about 130 days and then he'll be gone. Doge is a temporary entity, not a department. Some things bear repeating. And I say this because it's important for us to note that the person who is heading Doge has not been elected, has not been vetted.
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