Opening the Thursday afternoon session of the CLPHA meeting, Richard Voith and Michael Mariano of the Econsult Corporation presented preliminary findings of the economic impact of the $4 billion in Recovery Act capital funds awarded to PHAs. Their findings build upon the CLPHA-initiated 2007 Econsult study: Assessing the Economic Benefits of Public Housing.
The 2007 report found that, on average, every dollar spent by PHAs on capital repairs and maintenance generated $2.12 local economic activity. The analysis also found that every $1 million of spending on capital repairs and maintenance supported 14 jobs in the region. This study has been noted numerous times as evidence that PHA spending is an economic generator. In fact, it was cited in the Recovery Act committee report as justification for making such a significant investment in public housing capital funding budget.
This latest study, undertaken by CLPHA in collaboration with NAHRO and PHADA and funded by the HAI Group, builds on the 2007 findings.
In addition to studying the national economic benefit of Recovery Act grants, the study is designed to examine how a large infusion of capital spending could be used to improve vacant units, address energy efficiency, and reduce maintenance costs. The survey was distributed to members of the industry groups. Approximately 20 housing authorities, owning nearly a quarter of the national public housing stock, responded.
Recovery Act Survey Results
The survey, which is more robust than the 2007 report, confirms that PHA spending continues to have a significant effect on the economy. Because it captures additional data, it shows that nationally, each dollar spent generates $3.12 of economic activity. Econsult also estimated that on average, every $1 million spent created 26 jobs, surpassing a other sectors of the economy.
In addition to the economic benefits, the research shed light on the impact on the national portfolio. Respondents were using Recovery Act funds to complete work on more than 54,000 units at nearly 300 properties. (This confirms HUD’s report that 245,000 units have been renovated to date using Recovery Act funds.) The research also found that more than 1,800 units were brought back online by the survey participants.
The final report, which will be released early next year, will include findings on maintenance cost reductions and energy efficiency, and the extent of funds leveraged using Recovery Act grants.
Applying the estimates to the national housing stock, the $4 billion infusion of capital funds would support more than 100,000 jobs nationwide and generate nearly $12.5 billion in national economic activity. This once again demonstrates the important place that public housing has within the nation’s infrastructure, as well as the industry’s ability to quickly and efficiently improve the economy.