How's HUD Doing: Agency Performance As Judged By Its Partners
Executive Summary
SECTION 1: INTRODUCTION
This section presents background information for
understanding the survey data to be presented in Sections 2
and 3, below. It defines the nature of the partnership that HUD
has with numerous private and public entities that help to
administer its programs, provides context for understanding
the impact that recent management changes may have had on
such partnerships, discusses the partner surveys that form the
basis of this report, and describes the organization of the
remainder of the report.
HUD,
Its End-customers,
And its Partners.
HUD administers an array of programs in the housing,
public housing, fair housing, and community and economic
development areas, and has numerous types of end-customers.
1
To serve them, the Department generally works
with thousands of intermediaries—generally referred to as
partners—to carry out its mission. These include: nonprofit
organizations; state and local governments and elected officials;
housing agencies, authorities, and tribes; community
and faith-based organizations; other HUD grantee
organizations; various housing industry groups including
lenders, brokers, appraisers, and multifamily developers and
owners; health care facilities providers; small businesses; fair
housing organizations; and investors.2 By and large, such
public and private partners are HUD's direct link to most of its
ultimate customers. The nature and quality of the relationship
between HUD and its partners, therefore, has considerable
consequence for the achievement of HUD's mission.
HUD's relationship with its partners affects its ability to
deliver service—that is, effective working relationships
between HUD and its partners enhance the Department's
service value to its end-customers. And, given the nature of
their immediate relationship with the Department, partners,
more so than end-customers, are likely to be aware of, directly
affected by, and knowledgeable about HUD's performance.
As intermediaries between HUD and its end-users—clients, recipients, program beneficiaries—or even those
affected by the Department's programs, HUD's partners share
an interest in providing customer services and benefits to them.
To that end, HUD generally provides funds to its
partners for their use or redistribution, and aids and supports
them in other ways to serve customers. However, HUD's
partners may also have interests that are different or
independent from those of HUD's end-customers (or at least
from some of them), and HUD's various partners may have
interests that differ one from another. As the "senior partner"
responsible for serving a multiplicity of customer groups with
differing and sometimes conflicting needs and perspectives,
therefore, HUD is in the position of balancing interests and
regulating, monitoring, and sometimes taking adverse actions
against its partners. Indeed, this distinction between HUD as
"helper" and "enforcer" motivated significant aspects of HUD's
management changes over the last several years.
The bottom line is that, with respect to its partners,
HUD plays different, sometimes conflicting roles and, as a
result, the relationship between HUD and its partners is quite
complex and multifaceted. Partners' perceptions of HUD may,
likewise, be complicated and conflicted when it comes to
assessing the quality or value of the Agency's service to them.
Why should a public agency such as HUD be
concerned about how its partners judge the service it is
providing? To a corporation in a market environment the
answer is clear. Quality service can foster partner or
consumer loyalty, sales, and profits. Therefore, there is often a
profit motive for taking steps to ensure that the organization and
its employees offer services that meet their customers'
needs and expectations. Public sector organizations,
however, do not necessarily compete in a market environment,
do not have profit-oriented goals and, therefore, have no such
motivation to provide customer service. In fact, some public
sector agencies have organizational, staffing, and financial
management systems that are structured more according to
their own internal needs and interests than those of their
partners or customers. For agencies whose programs, or very
existence, may be politically vulnerable, however, such
systems can result in a damaging loss of public support.
Facing just such a situation, HUD undertook a series of
organizational and management changes intended to restore
public trust in the Agency. A yet unanswered question is what
the effects of these changes have been, if any, on HUD's
relationships with its customers and partners.
Recent HUD Organizational and Management Changes, and
the Value of Measuring their Effects.
In part to create a more supportive constituency for the
Department and its programs, and to respond to its
designation by the General Accounting Office as a "high-risk"
agency, HUD undertook various reforms over the last
decade—including a recent round of organizational and
management changes termed HUD 2020. The latter
emphasized, among other things, the improvement of
customer and partner service. For example, a Community
Builder function was created to deal with partner and customer
relations; storefront offices were opened for customer
convenience; and customer service performance indicators
were developed for various services. Also, attempts were
made to develop more efficient data systems that would
provide credible and timely information to partners and end-
customers. According to the plan that preceded these
changes:
HUD is adopting a business-like structure to
achieve a public purpose. It defines a clear
mission divided into identifiable functions for
each separate business line. It centralizes
some operations for economies of scale while
decentralizing other operations to improve
service delivery and innovation. It uses
technology to improve efficiency -- both in
front-line service delivery and in the creation
of back-office processing centers. It puts a
new stress on enforcement and economic
development, while making information on
HUD's resources more widely available
through computers. And it implements a
broad set of performance measures to best
target resources to communities in need.3
The various organizational, staffing, and systems changes
that HUD put into place were intended to create a unified
sense of mission across the Agency, alter its organizational
culture, and enhance its service value in the eyes of its
partners, customers, stakeholders, and the public-at-large.4
The expectation was that such changes would improve
HUD's ability to achieve desired community and peoplefocused
results—the Agency's ultimate raison d'être.
HUD, its stakeholders, the Office of Management and
Budget (OMB), the Congress, and the general public have an
interest in knowing if these varied organizational and management
changes are improving the Agency's overallperformance. Indeed,
OMB's 1998 priority management objectives explicitly included the
following statement about HUD:
Implementation of HUD's management
reform plan began in June 1997 and will
extend to 2002. HUD will periodically
measure changes in its performance to
assess the impact of reform. Performance
Measure/Commitment: Use customer
surveys (Mayors, public housing residents,
project-based housing owners) to measure
changes in organizational performance.5
Consequently, HUD committed to using partner
surveys as one means of determining if the agency is fulfilling
its service objectives. Consistent with its responsibilities under
the Government Performance Results Act of 1993, the
Department's Annual Performance Plans, as well as the
Government-Wide Performance Plan for Fiscal Year 2000,
such surveys are intended to accomplish three purposes:
to measure the current level of partner satisfaction
with HUD,
to determine if the services HUD provides have
improved in the wake of organizational and
management reforms, and
to establish a baseline against which to measure
future change in HUD's performance.
One of HUD's goals is for its partners to be satisfied with the
Department and perceive the organization as effective.
Surveys provide information with which to measure both
satisfaction levels and perceived organizational effectiveness.
Once a baseline is established, changes in those levels can be
monitored. Hence, the Department intended that the surveys
would be re-administered periodically, at intervals of
approximately two years, in order to continue to assess
partner satisfaction and perceptions. Especially in those areas
where HUD's performance is seen to be lacking, the surveys
provide a means for measuring the extent of improvement
over time.
Partner surveys. To conduct a baseline survey, HUD
contracted with the Urban Institute, an independent, nonpartisan
research organization located in Washington, DC.
Contracting out partner surveys—and doing them at arms-length—was meant to ensure that the results would be valid
and credible representations of partners' evaluations of the
Department's performance.
Among the many partner groups with which HUD
deals, the Department requested that eight of them be
surveyed, each representing a significant constituency.6 They
are:
A list of issues to be addressed by these groups was
jointly developed by Urban Institute research staff, HUD
program staff, and representatives of organizations
representing each group. The issues generally fall into the
following clusters:
Partner satisfaction with HUD's current
performance. This includes their satisfaction with
HUD's programs, the quality and timeliness of
information received from HUD, the quality and
consistency of guidance received from HUD, the
reasonableness of HUD's rules and requirements,
and the responsiveness and competence of HUD
staff.
Partner beliefs regarding improvement in
performance as a result of recent organizational
and management changes. This includes their
evaluation of the consequences of such changes—
whether they are making HUD better or worse, or
not changing HUD at all—and the extent to which
HUD's organizational and management reform
objectives have been achieved to date.
Partner appraisals of selected program
requirements, service provision, or organizational
and management changes. These vary by
program area and partner group, and indicate the
extent to which partners see the Department as
performing well or moving in the right direction with
respect to key aspects of their program areas.
Responsibility for design of the survey questions,
development of procedures, and selection of samples resided
exclusively with Urban Institute research staff. Administration
of the surveys was the responsibility of the Survey Operations
Center of Aspen Systems Corporation, located in Washington,
Maryland.15The surveys were conducted between December
2000 and June 2001, using a combination of mail and
telephone administration. To ensure the credibility of survey
results, respondents were guaranteed confidentiality, and
given the assurance that neither HUD nor others would be
able to associate individual names, organizations, or
communities with survey responses.16 Once the surveys were completed, Urban Institute researchers were responsible for
independent analysis of the results and preparation of this
report.
Response rates. The rate of partner mail and
telephone response to the surveys was exceptionally high (see
Exhibit 1.1)-indicative of strong partner interest in having the
opportunity to provide feedback to HUD and suggestive of a
continued need on HUD's part to provide such opportunity.17For all but HUD's multifamily partner groups, response rates
range from to 92 percent (for FHAP agency partners) to 83
percent (for PHA partners); the average for these groups,
excluding multifamily partners, is 86 percent. The rate of
response for multifamily property owners is lower-62
percent-and ranges from 74 percent (for Section 202/811
owners) to 51 percent (for HUD-insured owners).
HUD's multifamily partners are an inherently difficult
group to survey. In part, this is because of the challenge of
identifying appropriate persons who represent the complex set
of corporations, syndications, partnerships, and legal entities
that own some of the multifamily properties insured or assisted
by HUD. And, in part, this is because of the challenges faced
by HUD in maintaining a complete, up-to-date list of names,
addresses, and telephone numbers of these entities. Of all the partner groups surveyed, only those sampled from HUD's
multifamily list resulted in numerous returned ("addressee
unknown") mail questionnaires from the U.S. Postal Service or
FedEx, or contained some missing or inaccurate telephone
numbers such that phone contact could not always be made.
Indeed, if such cases are removed from the sampling frame for
purposes of calculating a response rate, the overall rate of
response for multifamily housing partners improves to 75
percent.
Finally, some multifamily housing partners have
relatively little on-going contact with the Department and, as a
result, may have less of an interest in responding to a
questionnaire; this may also account for the relatively lower
response rate achieved for this group.
Overall, however, the high rate of response to the
partner surveys is important. In conjunction with the sampling
methods used, a high response rate provides confidence that
respondents are representative of the various partner groups
included in the surveys.
Survey instruments. Survey instruments—reprinted
in the Appendix—contain a series of questions common to all
partner groups, and additional questions unique to each
group's programmatic experiences with HUD. Common
questions cover partners' (a) overall evaluations of HUD's
performance, (b) evaluations of the quality of service they
receive, (c) assessments the effects of recent HUD management
changes, and (d) appraisals of the extent to
which HUD's management reform objectives had been
achieved as of the data of the survey. These, as well as
questions unique to each partner's relationship to HUD, are
closed-ended—with pre-established response categories. In
addition, the survey permitted respondents to provide
additional comments about HUD, in their own words, at the
conclusion.18
Exhibit 1.1: Sample Sizes and Response Rates
Respondent Group
Sample Size
Number of Respondents
Response Rate
Adjusted Response Rate*
Community Development Departments
500
449***
90%
—
Mayors Offices
620
524
85%
86%
Public Housing Agencies
500
415***
83%
—
Fair Housing Agencies
85
78
92%
—
Multifamily property ownership entities:
Section 202.811
HUD-insured
(unsubsidized)
HUD-assisted
(subsidized)
1,250**
777***
62%
75%
400
294
74%
86%
400
203
51%
64%
400
249
62%
75%
NAHP nonprofit organizations
59
51***
86%
—
Respondents. Questionnaires were sent to directors
of Community Development Departments, Public Housing
Agencies, FHAP Agencies, and NAHP-affiliated (non-profit
housing) organizations; to mayors; and to owners of
multifamily properties. Owners consisted of CEO's, managing
general partners, presidents, chairpersons, principals, or
organization directors.
In many instances, the persons to whom the surveys
were sent personally responded, as requested. But, in some
cases, others responded on their behalf. In correspondence
sent along with the questionnaires or following the initial
mailing, or in phone conversations with potential respondent
organizations, it was emphasized that the director, mayor, or
owner was the intended respondent. If, however, it was not
possible for that person to respond, recipients were asked to
direct the survey instrument (or phone interview) to someone
who could speak authoritatively on behalf of that person.
The proportion of respondents who were directors,
mayors, or owners is shown in Exhibit 1.2. When "other
persons" responded, they held a variety of positions. For
example, speaking on behalf of agency and organization
directors were sometimes deputy directors, senior officials, or
agency/organization employees. Speaking on behalf of
mayors were sometimes deputy mayors, chiefs of staff, senior
assistants, members of mayors' immediate offices,
departmental senior officials, or local government employees.
And, speaking on behalf of owners were sometimes company/
organization senior officials, employees, and property
managers, among others.
A large proportion of directors of PHAs, NAHP-affiliated
(non-profit housing) organizations, and FHAP agencies
personally responded to the surveys. Smaller proportions of
multifamily owners and directors of Community Development
Departments responded; and about one in five mayors
personally responded to the survey.
Exhibit 1.2 Survey Respondents
Partner Group
Percent Director/Mayor/Owner
Percent Other Persons
Community Development (CD) Departments
44
56
Mayors Offices
22
78
Public Housing Agencies (PHAs)
90
10
Fair Housing (FHAP) Agencies
76
33
Owners of Multifamily properties:
Section 202.811 Ownership Entities
HUD-Insured
(Unsubsidized) Ownership Entities
HUD-Assisted
(subsidized) Ownership Entities
40
60
60
40
62
38
Non-profit Housing Organizations (NAHP affliated)
80
20
Organization of
The Remainder of
This Report
Survey results are presented below in Sections 2 and
3. Section 2 provides the "big-picture" summary—comparing
the eight partner groups' assessments of: (a) HUD's overall
performance; (b) the quality of service provided; (c) the effects
of organizational and management changes; and (d) the
extent to which organizational and management reform
objectives have been met.
Section 3 is divided into eight parts, one for each of the
partner groups surveyed. The presentation for each is similar,
and follows the format of Section 2.
Footnotes 1 Ultimate customers are those provided assistance, services or benefits of
various kinds. Included, for example, are people whose home mortgages
are insured by FHA as well as those who face housing discrimination;
people who live in public housing as well as those who receive businesses
loans using Community Development Block Grants; and people who are
homeless as well as those who rent private-market housing using vouchers.
2 Specific examples of intermediaries are private owners of HUD insured or
assisted housing units, public agencies that own and manage public housing
developments, fair housing agencies that provide educational and
adjudication services, and state and local government agencies and officials
involved in community improvement.
4 HUD's 2020 management plan emphasized the following changes:
reorganization by function rather than strictly by program cylinders, including
consolidation and privatization where needed; modernization and integration
of outdated financial management systems; creation of an Enforcement
Authority; refocusing and retraining of the Departmental workforce;
establishment of new performance-based systems for programs, operations,
and employees; and replacement of a top-down bureaucracy with a new
customer-friendly structure. The complete catalog of changes, however, is
considerably longer, including: creation of a Real Estate Assessment
Center; outsourcing of legal and investigative services; integration of a
fragmented management system; downsizing of staff; creation of GPRA
performance measures that hold staff and grantees accountable for results;
and creation of neighborhood "store-front" service centers in communities.
In addition, each major HUD "business line" separately instituted its own set
of reforms. These included, for example; establishment of two Troubled
Agency Recovery Centers for the Office of Public and Indian Housing;
development of streamlined contract and procurement processes for the
Office of Housing; use of advanced mapping software systems that show
communities the impact of HUD funding and activities in their area for the
Office of Community Planning and Development; and elimination of the split
between enforcement and program/compliance functions in headquarters
and the field for the Office of Fair Housing and Equal Opportunity.
5 Excerpted from Section IV of the Budget of the United States Government,
FY 1999, "Improving Performance through Better Management."
6 Methodological information can be found in the Appendix.
7 These are local government agencies that engage in a wide variety of
community and economic development activities, often in conjunction with
HUD's Community Development Block Grant (CDBG) program and other
HUD programs.
8 Included are other chief elected officials if there is no Mayor, such as Town
Supervisor, Council President, President of the Board of Trustees, Chair of
the Board of Trustees, Chair of the Board of Selectmen, First Selectman,
Township Commission President, etc.
9 These are public entities created by local levels of government, through
state-enabling legislation, to implement HUD's public housing and Section 8
programs.
10 These are state and local government agencies that administer laws and
ordinances consistent with Federal fair housing laws.
11 Section 202 provides for housing with supportive services for elderly and
handicapped persons; Section 811 provides for housing with supportive
services for persons with disabilities.
12 These are owners of multifamily properties whose mortgages are insured
by HUD; neither rental assistance or mortgage interest subsidies are
provided. Owners represent a range of entities including: public agencies;
non-profit, limited dividend, or cooperative organizations; and private
builders and profit-motivated businesses.
13 These are owners of multifamily properties that are either insured under a
HUD mortgage insurance program involving mortgage interest subsidies, or
that are provided with some form of HUD rental assistance. Owners may be
for-profit businesses or non-profit organizations.
14 The NAHP is a group of 59 major, independent non-profit organizations
across the nation engaged in a wide variety of housing-related activities.
Most of them are sophisticated housing developers, lenders, or providers
who may work with one or more HUD programs and program offices.
15 Aspen Systems Corporation served as a subcontractor to the Urban
Institute.
16 Even so, some potential respondents communicated their fear of
retribution from HUD should their responses be disclosed, some refused to
participate out of concern about disclosure, and a small number removed
survey control numbers from the questionnaires to further protect their
anonymity. This experience suggests that, for such surveys to accurately
reflect partner opinion and be credible, they should only be done under thirdparty
auspices and with appropriate provision for the protection of
respondent confidentiality.
17 Ninety percent of the completed surveys were returned by mail, the rest
were administered by telephone. Based on survey research industry
experience with mail surveys, this mail return rate is unusually strong.
18 The proportion of respondents who chose to provide additional comments varied by group, and ranged from 22 percent (for HUD-insured multifamily property owner partners) to 52 percent (for Public Housing Agency partners)—with approximately one-third of the respondents in four of the
partner groups providing additional comments. Comments often consisted of
two or three sentences, but some were considerably longer. Along with the
high rate of response to the surveys, the large number of open-ended
comments is also indicative of partner interest in being able to provide
feedback to HUD. Both positive and negative comments were offered but,
as might be expected when presented with such an opportunity, more of
them were negative than positive. These are summarized in Section 3 of
this report, at the end of each partner group section.
| 
