The U.S. Department of Housing and Urban Development said Wednesday it will close its field offices in Sacramento and Fresno, along with 14 others nationwide, as part of a restructuring that HUD expects to save up to $150 million.
The move to close HUD's two Central Valley offices by the middle of next year drew a strong response from the region's members of Congress, who said the Valley was among the hardest hit by the housing crisis and needed the local HUD offices to help in the recovery.
"We're outraged about this," said Rep. Doris Matsui, D-Sacramento. She said the HUD office closures amounted to a symbolic abandonment of the Central Valley.
"We're still not out of it yet," Matsui said of the foreclosure crisis. "We're doing better, but we're still very vulnerable. We still need to have ready access (to HUD resources)."
Matsui was among four Central Valley lawmakers who wrote to HUD Secretary Shaun Donovan on Wednesday asking him to reconsider.
"HUD's presence in the Central Valley has provided critical assistance by helping public housing authorities, local government agencies and nonprofit organizations understand the department's programs and policies," the letter said.
The other signers were Reps. John Garamendi, D-Walnut Grove; Ami Bera, D-Elk Grove; and Jerry McNerney, D-Pleasanton.
The letter also alluded to tension between the department and lawmakers.
"California's Central Valley has, unfortunately, led the nation in foreclosures and many of us have had serious concerns in the past about HUD's commitment to serving the region," the letter said.
In an interview with The Bee, Matsui explained that she and others felt HUD hadn't done enough during the housing crisis to help thousands of residents struggling to keep their homes. For instance, the department could have put more pressure on lenders to modify home loans, she said.
While not perfect, "at least they were here," Matsui said. "If people are sitting in San Francisco, they may not understand what's happening in Sacramento and Stockton and Fresno."
Gene Gibson, a spokeswoman for HUD in San Francisco, said she understood Matsui's concerns. But she said the agency would continue to provide the same level of services to the region through its San Francisco office.
Much of HUD's work is done by computer and telephone, she said.
The system of 80 field offices nationwide, established during the presidency of Richard Nixon, is outdated and wasteful, she said.
The department has gone from 18,000 employees at its peak in the 1970s to 9,000 employees today, officials said. Many are sitting in half-empty offices.
The decision to close the Sacramento and Fresno offices, Gibson said, was part of a nationwide effort by HUD to "reduce its footprint" nationally and save on rent. A portion of the 900 employees affected by the move will end up retiring or leaving, she said.
The department is closing 14 other offices in cities such as Dallas, Tucson, Ariz., and Grand Rapids, Mich.
The 15 workers in the Sacramento office in the John E. Moss Federal Building on Capitol Mall will be offered new jobs in other HUD offices along with relocation assistance, she said. They'll also have the option of taking early retirement or a buyout.
"We're not abandoning a community," Gibson said. "It's just a matter of closing a little office."
Pam Canada, CEO of NeighborWorks Home Ownership Center in Sacramento, said the local HUD office would be missed. It serves as a clearinghouse of information about federal housing programs and helps connect government agencies and nonprofit groups, she said.
But HUD does not provide one-on-one help for residents; it can only refer them to outside help, she said. HUD used to have a local center to process home loans backed by the Federal Housing Administration, but it doesn't anymore, she said.
Still, she said, the closure of the HUD office could prove a setback.
"We're starting to see a light at the end of the tunnel," Canada said of the housing crisis. "Losing a resource like that right now might not be the best timing."
Call The Bee's Hudson Sangree, (916) 321-1191.
Editor's note: This story was changed April 26 to clarify the 15 workers in the Sacramento office in the John E. Moss Federal Building on Capitol Mall will be offered new jobs in other HUD offices along with relocation assistance.