Four years to the day when he officially took office, HUD Secretary Alphonso Jackson resigned from that post this morning, at a time when the Bush administration has been scrambling for ways to solve the ongoing housing crisis. Jackson's resignation takes effect April 18.
In a resignation speech that lasted less than four minutes, the 62-year-old Jackson gave no explanation for his decision to leave other than that he wants to "attend to personal and family matters" after serving more than 30 years in various state and federal housing-related jobs. But the Bush administration has been under increasing pressure from certain lawmakers to ask Jackson to step aside, including Senators Christopher Dodd and Patty Murray, who made that request in writing to President Bush 10 days ago. "This is a cabinet secretary who has consistently ducked accountability and arrogantly refused to heed the public's calls for answers," said Murray (D-Wash). "Secretary Jackson should resign immediately and seek to clear his name as a private citizen."
In his comments, Jackson said that during his tenure, "I sought to make America a better place to live," and listed among his accomplishments efforts to expand minority homeownership and preserve affordable housing. HUD has also been front and center in the administration's attempts to keep distressed homeowners from losing their homes to foreclosure, most notably through the greater role of the Federal Housing Administration (FHA), a HUD agency, in the mortgage markets. He did not take questions after his comments.
A Texas native, Jackson was appointed HUD's deputy secretary in June 2001, and was unanimously confirmed by the U.S. Senate as HUD Secretary on March 31, 2004. Prior to his tenure with HUD, Jackson's resume includes serving as president of American Electric Power-TEXAS, a $13 billion utility company. From January 1989 until July 1996, Secretary Jackson was president and CEO of the Housing Authority of the city of Dallas.
However, his management of the $32 billion HUD has been criticized repeatedly, particularly for his department's passive initial response to the public housing crisis created in the Gulf States in the aftermath of Hurricanes Katrina and Rita. Jackson also invited criticism by his remarks and actions. In a speech he delivered in Dallas two years ago, he stated that he revoked a contract from a friend who admitted he didn't like President Bush. Those comments led to an investigation by HUD's inspector general (who cleared Jackson of any wrongdoing). In March of this year, news reports cited e-mails between senior HUD officials that may suggest they sought to punish the director of the Philadelphia Housing Authority because he had refused to turn over property to Universal Community Homes, a development company founded by a friend of Jackson's. On the date that the e-mails were sent, HUD notified the Authority that it was in violation of rules regarding accessibility for disabled residents, according to a report in the Washington Post.
The FBI, the U.S. Justice Department, and HUD's inspector have also launched investigations into conflict of interest allegations related to a $127 million redevelopment project in New Orleans that Jackson had awarded to Atlanta-based contractor Columbia Residential, which is said to have had significant financial ties to Jackson and was paid $392,000 as a construction manager by HUD.
Jackson also ran afoul of a federal judge earlier this month in regard to HUD's plan to eliminate the use of seller-funded down-payment assistance programs for FHA loans. HUD announced plans last fall to eliminate the programs, which prompted several lawsuits from organizations that provide the assistance. On March 3, U.S. District Court Senior Judge Lawrence Karlton issued a ruling that prohibited HUD from doing away with the programs and disqualified Jackson from participating in future rule-making on them.
The judge said Jackson had an "impermissible bias" against the programs. The ruling was based on comments attributed to Jackson in a news report in which he said HUD planned to approve the new rule (banning the use of seller-funded down-payment assistance for FHA-insured loans) by the end of 2007, even if the agency received critical comments about the plan.
With only 10 months left in his administration, President Bush must now find a replacement for Jackson at a time when leadership from HUD could be seminal to the recovery of the housing market.
Senior editor Pat Curry contributed reporting to this article.
For more coverage on this story, log on to Hanley Wood's Affordable Housing Finance blog.
Learn more about markets featured in this article: Atlanta, GA.
