David Lipsetz is the CEO of the Housing Assistance Council (HAC), which has been helping local organizations build affordable housing in rural America since 1971.

David Lipsetz
Maya Wechsler David Lipsetz

He joined the Washington, D.C.–based nonprofit in late 2017 after serving as associate administrator for rural housing and community facilities at the U.S. Department of Agriculture (USDA) and holding senior positions at the U.S. Department of Housing and Urban Development (HUD). He’s also managed affordable housing programs in New York City and Oakland, Calif.

Lipsetz grew up in Ohio and West Virginia, and now lives with his family in D.C. His wife, Catherine Crosland, is a doctor who treats individuals who are homeless.

What was your first housing-related job and what did it teach you?

I fell into it like many others in the industry. I finished my undergrad degree at Michigan State and drove straight to D.C. for a job as a legislative assistant for Congressman John Dingell. He was a big, intimidating guy with a reputation for grilling witnesses, staff, friends, foe, and everyone else. I was assigned housing and HUD issues, which he had worked on for decades and I knew nothing about. I was scared to death when he called me into his office on my first day, sat me down, and started with “I don’t pay staff to agree with me!” I responded that he shouldn’t worry since I knew little about housing law and at $21,000 a year there wasn’t much pay at risk.

What issue have you spent the most time on this year?

Capacity building for rural organizations. HAC grows local leaders with training, one-one-one technical assistance, and organizational development. This is HAC’s bread and butter. The need for high-performing nonprofit housers in small towns is enormous.

Why is the need so big?

Today’s housing programs are complex and require dedicated specialists to successfully apply and comply. You can forget about low-income housing tax credits or New Markets Tax Credits or Opportunity Zones if you’re in a region without a strong Community Development Financial Institution [CDFI], developer, or local government agency with housing expertise.

Share with us a rural housing fact or statistic to think about.

I’ll give you two. The deepest and most persistent poverty is in rural America. Small towns and rural regions make up 18% of the population, yet 86% of the persistent poverty counties are rural. In this context, persistent poverty is defined as 20% of the people have lived on less than the federal poverty limit for more than 30 years.

Rural places get a disproportionately tiny portion of federal housing subsidies. Remember, 18% of the population lives in small towns and rural places. Yet, these communities receive less than 7% of the nation’s biggest housing subsidy program. Why? Because the nation’s biggest housing program is the mortgage interest deduction [MID], which subsidizes single-family homeowners living in high-cost markets the most. The MID was worth about $83 billion in 2017, so a proportionate—dare I say fair—share of MID spending would put more than $10 billion a year back into rural home values.

What rural housing trends are you keeping an eye on?

The Section 515 Rural Rental Housing program is hemorrhaging units. It lost several thousand units this year, and without a major intervention or change in the program the losses are about to skyrocket. Why is it about to get worse? Woeful funding levels have created a backlog of over $5 billion in basic repairs and renovation in the program’s remaining 410,000 units. Worse, Section 515 properties are kicked out of the program and lose their annual rental assistance subsidies as soon as their original USDA mortgage matures. About a thousand Section 515 projects have mortgages maturing by 2027, at which point the rate increases to 400 to 900 maturing mortgages every year until all the properties have matured out.

For your readers unfamiliar with this federal program, run out of USDA, it is like a chronically underfunded version of Section 8 PBRA [project-based rental assistance] for rural communities that have had little-to-no HUD housing. Instead of a renewable multi-year HAP [Housing Assistance Payment] contract based on a FMR [fair market rent], there is a nonrenewable 20- to 50-year Section 515 mortgage and a separate Section 521 rental assistance program that only includes about 80% of the units in its budget-based subsidy.

What will be HAC’s priorities in 2020?

We are a CDFI with a resurgent loan fund that’s actively making loans and building a big pipeline to increase the supply of affordable housing in rural America. Of course that increased activity is depleting our capital stack so I’m polishing my tin cup to go out looking for equity, EQ2 [equity equivalent investment], or PRI [program-related investment]. If we have to rely on debt to rebuild our stack, it will have to be priced for use in rural markets that have lower rents, fewer units per project, and less public subsidy or tax credit equity.

In 2020, we’re also launching HAC’s 50th anniversary celebration at our national rural housing conference. This will include publishing our fifth Taking Stock, HAC’s decennial report that has long been the authoritative source on rural housing conditions.

What has recently discouraged you?

Less than 6% of domestic grants by large foundations go to rural-based organizations despite these places having higher rates of poverty, uninsured families, food insecurity, declining life expectancy, a fraction of the education and job opportunities, and a system rife with public policy and institutional bias extracting resources and opportunity out of the communities for the benefit of a distant wealthy elite. If we’re leaning on philanthropy to pick up the slack in this era of smaller government, their spending is worsening the divide and leaving rural communities behind.

What has recently inspired you?

During the last presidential election, one of the candidates had a tiny mention of housing in her platform, and I remember thinking, “That’s great. Somebody knows we exist as housers.” This year, almost every single candidate has a detailed awareness and plan for addressing the affordable housing crisis that includes rural-specific elements. It’s inspiring to me that people are finally recognizing the truth that many of us having been telling for years: Addressing affordable housing solves many of the root causes of inequality and poverty.

Favorite book and why:

I’ve been reading the Harry Potter books with my kids. Their sense of wonder and excitement is so much fun to experience.

Favorite spot in Washington, D.C.:

Having grown up in Ohio and West Virginia where the front porch is a central part of one’s house, it’s sitting on our front porch listening to the crickets at night.