Response We agree that the present data source called the Municipal Automated Georgraphic Information System (MAGIS) would benefit from more specific information on income and household composition. The Department intends to institute the collection of these data as part of a systematic code enforcement program and add them to MAGIS for analysis of program needs. This means that these data would be collected for that part of the city where systematic code enforcement is most needed. The collection of these data for every household in the city however is infeasible in terms of money and available staff. The costs of providing these data on income and population characteristics has particular significance when viewed against the city's declining Community Development Block Grant and the need to reduce administrative cost. Based on information supplied by the U.S. Bureau of Census concerning the decennial Census, an average of $7 per questionnaire is charged for the handling of a survey form. Additional charges have to do with the design of the survey questionnaire and the tabulation of the results, which may include call backs where responses to the survey are low or incomplete. Depending on the city the total per household cost 22 of carrying out a Census survey may vary between $30 and $100. Assuming that the Department would survey all of the currently 278,000 units in the city, the total cost could be between $8.34 million (at $30/survey form) and $27.8 million (at $100/survey form). Compared against our CD-5 grant of $22.0 million carrying out the survey would constitute between 38% and 126% of the Department's CD-5 entitlement. On the other hand, if the City limited its survey to the 65,000 rental households and 15,000 owner-occupied households the 1979 Housing Assistance Plan indicates the need of housing assistance the costs would be between $2.4 million (at $30/survey) and $8 million (at $100/ survey), which represents between 11% and 36% of the CD-5 entitlement. It is important to note the Census collects income data on a 20% sample. In view of HUD's insistence that the Department reduce its administrative costs, the Department cannot commit itself to gathering the kind and scope of data your recommendation suggests. Recommendation improving program planning by identifying housing needs on the basis of current data and more specifically defining housing objectives. Response MAGIS has provided the Department with a capability to identify housing needs and define housing objectives that it did not have previously and that few if any other cities have at all. On the basis of the information stored in MAGIS, plus other data not included in MAGIS, the Department has been able to classify neighborhoods in terms of on-going trends, problems and conditions, and ascertain housing needs and develop program objectives strategies for housing in the city. From data contained in MAGIS, it is possible to pinpoint neighborhood change. Because Washington has experienced an explosion in real estate investment, particularly in the central city where the Department's urban renewal programs were targeted, the primary indicator of neighborhood change is real estate sales. From real estate sales data in MAGIS, the Department has developed a statistical indicator which tracks changes in single family sales and sales prices from 1970 thru 1978. This indicator alone has highlighted those neighborhoods where sales and prices have remained consistent but at high prices, moderate prices, or low prices. It has also located those neighborhoods where real estate activity has actually declined. More importantly, it clearly has focused on those neighborhoods where activity has increased dramatically, where prices have risen at a rate far above the city average, and where displacement of low and moderate income families has been triggered. Using ownership information in MAGIS, it is possible to tell whether this trend occurred in neighborhoods with high, moderate or low levels of owner-occupancy. From data on repair permits also in MAGIS-- it is also possible to show whether or not high sales activity is followed by rehabilitation, another signal that displacement is happening. Supplemental data on income and welfare, not included in MAGIS, show which neighborhoods have serious social and economic problems. Land use information in MAGIS further describes each neighborhood as to whether it is predominantly an area of single family homes, apartments, offices, shops, or industry. Staff field surveys collected data on the condition of buildings. An analysis of these diverse data led to the structuring of the neighbor hood classification system mentioned above. Four categories of neighborhood conditions were developed: (1) sound; (2) distressed; (3) transitional; and (4) stable. A sound neighborhood is one where incomes are high, single family home sales prices are also high, owner-occupancy levels are low. In a sound neighborhood families can maintain their homes without any public assistance. Distressed areas are the opposite of this description, and where the need for public assistance is great. Transitional areas are those where great change is underway: single family sales activity and sales price changes are high, and welfare cases are decreasing and incomes are increased because higher income families are moving in; and displacement of lower income families is taking place at a rapid rate. These trends may indicate a need to assist those lower income families to either find other housing elsewhere or to remain in the neighborhood. - Stable is the fourth category of neighborhood condition. In these neighborhoods real estate activity is low, single family homes prices are rising with inflation, incomes are at the moderate level, and housing conditions may be beginning to show the first stages of deterioration. These conditions may show the need for some public assistance to improve the condition of homes to provide a buffer to displacement trends from adjacent neighborhoods. GAO REPORT The results of this work have been discussed with citizens and community groups, as well as within the Department itself. The outcome of these discussions has been the Fifth Year Community Development Block Grant Application. Goals and objectives for the City's Community Development Program have been developed as well as specific strategies and schedules for the next three years for the improvement of individual neighborhoods identified as having particular housing needs. In addition, existing programs were evaluated to determine necessary revisions and new programs were sketched out to respond changing conditions and trends underway in the city. Response We have explored and will continue to review methods utilized by other cities to resolve housing problems. The Pittsburgh Home Improvement Loan Program is a good example which the District investigated as a model for a local revenue bond financed rehab loan program. Legislation is pending in Congress for the creation of a housing finance agency to provide for revenue bond financing of both home purchase loans and rehabilitation loans. Congress, in the past, has been reluctant to authorize the District to use its bonding authority After considerable study of rehabilitation loan leveraging techniques of other cities we have developed a Tandem Rehabilitation Loan Program. The Tandem Loan Program is believed to be unique among programs in larger cities because of its variable interest rate based on the ability of the borrower to repay the loan based on a uniform underwriting standard. The Tandem program will enable us to effect changes in the processing of loans which will reduce processing time and cost and increase loan value. The program will reaffirm the importance of the private lending industry as the primary source of rehabilitation financing and enable the District to leverage its limited and declining CD Block Grant funds. DEPARTMENT OF HUMAN RESOURCES Welfare Payments Reduced: An Improved Method for Detecting Erroneous Welfare Payments (GGD-78-107), February 5, 1979. Background Working together, GAO and the District of Columbia's Department of Human Resources developed three formulas to identify welfare cases that have a high probability to be in error. The formulas assign computer-derived numerical scores to cases that need to be reviewed and rank them in order of their error potential. The District started using one formula in May 1977. Over a year's time, erroneous welfare payments will have been reduced by about $3.5 million or nearly double the reduction in erroneous payments that could have been obtained using the District's procedures. GAO stated that the approach used by them in the District is applicable to State and local governments. The recommendations were made to the Secretary of HEW that this report should be distributed to State and local governments and emphasize to them that using formulas similar to the ones GAO developed could help in reducing incorrect welfare payments. Although the report concerned welfare payments in the District no recommendations were made to the Mayor or other District officials. D. C. PUBLIC SCHOOLS Improvements Recommended for Better Oversight of Capitol Page School (GGD-79-56), April 26, 1979. Recommendations GAO recommended that the Board of Education: --Make a formal arrangement with the Secretary of the Senate and the Clerk of the House of Representatives for the operation of the Capitol Page School. --Assure that complete and accurate records are maintained for the operating costs of CPS. --Prepare and submit with its CPS budget a memorandum progress report on CPS operations including costs, educational program data, accomplishments, problems, and recommended solutions. Status The Superintendent of Schools in a letter dated April 3, 1979, advised GAO GAO REPORT that DCPS strongly supports the recommendations that a written contractual arrangement be arrived at between DCPS and the appropriate congressional offices for the operation of CPS. The Superintendent also stated that most of the coding errors encountered in the record for nonpersonnel expenditures for CPS should be overcome with the unified financial system now being developed by the Temporary Commission on Financial Oversight for the District. He pointed out that in the meantime, the written arrangement could provide that the CPS account could be established outside the regular DCPS appropriation funds accounts, such as is currently being done for Federal grants, and thus avoid any possibility of a confusion in the accounting records. The Superintendent also advised GAO that much of the problem of accounting records and budget estimates we have identified can be attributable to the disparity of fiscal year and school year. He said that if appropriations for DCPS were changed to coincide with the school year, DCPS could more clearly determine the cost of each school year without the necessity for transfer between fiscal years. |