A controversial Clinton administration program at the Housing and Urban Development Department to recruit people from outside the agency to work in local communities has hurt employee morale, HUD Secretary Mel Martinez said Wednesday. "The fact is that the Community Builders program has had a very negative effect on the morale of career people," Martinez said during a Senate Banking and Urban Affairs Subcommittee hearing on the agency's fiscal 2002 budget. "The sense of HUD's mission needs to be shared by the workforce." Although some Community Builders are career employees, several The Community Builders program was created in 1998 under then-Secretary Andrew Cuomo and recruited people from inside and outside HUD to serve as agency liaisons in communities across the country. Although some of the agency's career employees were chosen as community builders, several were chosen from outside government. Billed as an "urban Peace Corps," community builders provided information on the department's programs to potential beneficiaries and helped communities meet their housing needs. Martinez said HUD would not be going forward with the Community Builders program, but stopped short of saying it would be discontinued altogether. The department needs the personnel, but they could be deployed in different ways, he said. "Right now, we have a cadre of people with unspecified duties; we need to reallocate our resources." Participants in the Community Builders program earn $50,000 to $100,000 a year and enjoy the same benefits as federal employees. The Community Builders initiative was introduced a year after the department had downsized its workforce. Susan Gaffney, HUD's inspector general, has been critical of the Community Builders program, which was part of the department's HUD 2020 management reform plan. In a 1999 report, the IG's office said that the program increased the number of people at the department who are not part of any specific program and whose jobs are tied to the agency's political management. The IG also said the number of HUD programs and responsibilities continues to outpace staff levels and resources. "More often than not, when new HUD programs or activities have been announced, staff resources have not been discussed or considered. But it takes staff and resources to assure that programs include proper checks and balances," Gaffney said at the hearing. Gaffney also criticized the agency's practice of outsourcing. "Contracting out is not an easy answer. At HUD, we have contractors carrying out inherently governmental jobs," she said. Gaffney said the administration must "go much further in tightening HUD's mission statement and streamlining its programs." She said HUD's two most important priorities were to evenly match staff with the department's responsibilities and to modernize information technology systems. "There are serious deficiencies in the IT systems that undermine everything HUD does," Gaffney said. The hearing before the Subcommittee on Housing and Transportation focused almost exclusively on the administration's proposal to cut HUD's public housing capital fund and scrap the public housing drug elimination program. Martinez said the cuts will not affect the department's efforts to provide safe and decent public housing to residents. President Bush's fiscal 2002 budget request for HUD is $30.4 billion, an increase of almost 7 percent from 2001.