NEW YORK -- The nation's mayors and Rep. Barney Frank (D-Mass.), usually on the same side of urban issues, have parted company over Frank's plan to force them to provide housing for poor people displaced by federally funded development projects.
The proposal, in a $15 billion federal housing reauthorization bill now in a House-Senate conference committee, has sent tremors through city halls from here to Los Angeles.
The National League of Cities says the proposal would "limit municipal authority" and "sharply impact economic development."
A New York City lobbyist calls the plan "one more bureaucratic step to go through." Los Angeles County officials say Frank's requirements are "potentially so expensive they will make virtually any project . . . infeasible."
Frank scoffs at the reaction. "The mayors say there's such a tight housing market they can't comply with it," he said. "If there was a loose housing market, I wouldn't be as insistent about this."
His proposal takes aim at two of the mayors' favorite federal programs: urban development action grants (UDAG) and community development block grants, used for projects ranging from hotels to industrial parks.
If cities use these funds in a way that directly or indirectly displaces low- or moderate-income residents, the proposal says, they must provide them with affordable housing for 20 years.
In one sense, the skirmish is a preview of a much larger battle that will unfold over several years on what to do about hundreds of thousands of low-income tenants displaced when federal mortgage commitments expire on Section 8 and other housing programs. Members of Congress have not dealt with this potentially expensive dilemma.
Frank said some mayors' use of federal grants is exacerbating problems of homelessness and gentrification about which they often complain.
"The South End of Boston used to be a neighborhood for poor people. Now it's a neighborhood for rich people," he said, citing a UDAG grant used to finance an upscale shopping center that includes a Neiman-Marcus department store there.
But Howard Leibowitz, Boston's director of federal relations, said the city uses most urban-development aid for housing. "Until the federal government provides adequate funding for housing, there are better ways of achieving this goal," he said.
Judy Chesser, a lobbyist for New York City, also denied that federally funded projects are causing much displacement. "If the federal government wants to give us the money to carry this out, fine," she said. "Otherwise, they're just adding one more condition on the use of the money."
At the League of Cities, one of several urban groups fighting the plan, spokesman Randy Arndt said Frank's language is so broad that: "I don't know how you would be able to demonstrate some of these things, quite honestly. There is the chill factor. Is this going to undercut a whole project, if you know you have a 20-year obligation to provide housing? We're kind of boxed in."
Frank conceded that federal enforcement would be difficult, but added, "If you develop a new shopping center and the rents go up across the street, poor people are being displaced."
The mayors are focusing their lobbying efforts on Senate conferees, whose version of the bill does not include the antidisplacement language.