Transcript TRANSFORM RENTAL ASSISTANCE NALHFA – 2011 Annual Education Conference David Lipsetz US Dept of Housing and Urban Development May 19, 2011

TRANSFORM RENTAL ASSISTANCE
NALHFA – 2011 Annual Education Conference
David Lipsetz
US Dept of Housing and Urban Development
May 19, 2011
CHEAP PLOY TO CURRY YOUR FAVOR
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AFFORDABLE HOUSING PROGRAMS
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HUD RENTAL ASSISTANCE
HUD provides direct rental assistance across multiple programs with
varying rules and separate administrative structures.
Program
Section 8 Housing Choice Vouchers
Section 8 Project-Based Contract
Conventional Public Housing
202 Project Rental Assistance Contract
McKinney Supportive**
811 Project Rental Assistance Contract
Section 8 Moderate Rehabilitation
HOPWA
811 Mainstream Vouchers
HOME Tenant-Based Rental Assistance
Rental Assistance Program
Rent Supplement
TOTAL
Administrators
2,406
53
3,123
n/a*
1,938
n/a*
189
219
203
134
n/a*
n/a*
8,265
Units
2,233,706
1,189,294
1,175,244
102,550
87,435
27,666
25,037
23,862
14,783
12,239
11,315
9,205
4,912,336
* HUD administers through its local offices | **The numbers of administrators (grantees) and projects are estimates.
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WHAT IS PUBLIC HOUSING?
• Established by the 1937 Housing Act (Section 9)
• Provides “decent and safe rental housing for eligible low-income
families, the elderly, and persons with disabilities.”
• 1.178 million units, from single family houses to high-rise apartments.
• Managed by 3,300 local housing authorities.
• Resident Household characteristics and averages:
• 2.2 persons
• 52% elderly or disabled Head of Household
• $13,425 annual income
• $315 rent payment
• 51% white, 45% black, 4% other
• 52% stay less than 5 years
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HOW IS PUBLIC HOUSING FUNDED?
Federal subsidies allocated to Public
Housing Authorities (PHAs) on a per
unit basis to cover capital and
operating costs. PHAs also receive
rent payments directly from tenant’s.
Per Unit
Avg.
Federal subsidy
$515
Tenant Rent
$315
Monthly
$830
Source
Use
Capital Fund
Develop, finance, and modernize units, and for
management improvements
$2.50 B
Operating Fund
Operate and maintain units
$4.77 B
Other
Revitalization grants (HOPE VI)
$0.20 B
TOTAL
FY 2011
$7.47 B
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PRESERVATION OF PUBLIC HOUSING
HUD currently lacks a viable preservation strategy for its 1.2 million units
of public housing and for a number of “orphan” programs
• 150,000 public housing units have been lost over the last 15 years
• Remaining units have unmet capital needs of $20 to $30 Billion
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SOLUTION: TRANSFORM RENTAL ASSISTANCE
Allow public housing to convert to long-term, property-based
contracts.
• Replace the Deed of Trust with a Use Agreement
• Provide new Project-Based Section 8 Contract Authority
• Replace Section 9 rules and regulations with Section 8 rules
and regulations
Benefits
• Allows PHA’s to leverage other sources of funds to maintain,
renovate and replace properties (Estimated at $27 Billion)
• Encourage flexibility in financing & property use
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CURRENT STATUS
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May 2010: HUD Discussion Draft: Preservation, Enhancement,
and Transformation of Rental Assistance Act of 2010 (PETRA)
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December 1, 2010: Representative Ellison introduced H.R.
6468-The Rental Housing Revitalization Act based on feedback
to staff discussion draft
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February, 2011: President proposes a Rental Assistance
Demonstration in his FY12 budget submission to Congress.
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FY12 RENTAL ASSISTANCE DEMONSTRATION
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FY12 Demonstration built from TRA; Scaled-down version of
authorizing legislation
• Budgeted: $200 million
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Part of HUD’s larger strategy for rental housing preservation
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Working with stakeholders and Congress to define
components
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FY12 RENTAL ASSISTANCE DEMONSTRATION
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2 inventories included:
• Public Housing
• Rent Supp, RAP, Mod Rehab (“orphans”)
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2 tracks: PBRA and PBV
• Convert to Section 8 Property-based contract subsidy
• Assign Tenant-based Voucher funding to a specific Property
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Resident choice/mobility component on each track
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•
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Built into PBVs now
Add to PBRA track with available vouchers
Admin changes where possible (limited)
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PH inventory: Section 18 processing
Waive competition requirements
2x15-year contracts
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FY12 RENTAL ASSISTANCE DEMONSTRATION
PBRA - No Existing authority to establish new Section 8 contracts for
converting property
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Establish authority to convert under MAHRA?
PBV - 20% inventory cap; 25% per project cap; TPVs to convert
stock; “turnover vouchers” to support mobility
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Raise inventory and per project caps?
• Enhance choice/mobility limitations
Long-term contracts/affordability controls?
Combine with PH Capital funds at conversion?
Resident engagement/organizing to support conversion?
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TRANSFORMING RENTAL ASSISTANCE
Visit the TRA web page
www.hud.gov/tra
Join the TRA E-Mail List
Follow the instructions at the bottom of the TRA web page
Email [email protected]
Submit questions and comments to HUD
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REVITALIZATION ACT:
GUARANTEED LONG-TERM AFFORDABILITY
Congressman Ellison’s legislation to transform rental assistance assures Long
Term Affordability:
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•
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HUD must renew contract unless property or owner is not in good standing
PHAs must accept renewals offered by HUD
30 year agreement will be extended with each renewal
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In the event of nonrenewal, HUD may issue vouchers or, after consulting
with residents, transfer the assistance to another property
• Replace every hard unit 1-for-1 with only exception for weak markets
where vouchers are easy to use in low-poverty areas
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If a foreclosure occurs, the property remains affordable in perpetuity:
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Federal option to purchase former public housing properties
Rental assistance contract and Use Agreement survive foreclosure and
bankruptcy
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HAP RENTS FOR CONVERTED PROPERTIES
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For properties requiring above-market rents:
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For all other properties (those not requiring above-market rents):
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*
HUD could approve an exception rent up to the higher of 110% of the
applicable Fair Market Rent (FMR) or 120% of the comparable market
rent. For example, if 120% of the market rent were $500 and 110% of
the FMR were $560, HUD could allow an exception rent of up to $560
(the higher of the two) to ensure long-term sustainability
HUD could approve a rent up to the comparable market rent, capped at
110% of the FMR unless authorized by the Secretary. HUD could approve
a rent higher than 110% of the FMR, but only if necessary for
preservation*
This approval would be based on criteria established by the Secretary to determine
whether the property should be preserved.
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RESIDENT CHOICE AND MOBILITY
Residents of HUD-assisted housing often lack access to
economic opportunity because moving means giving up their
subsidy.
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Almost 2.4 million households that receive HUD rental
assistance cannot move without losing their subsidy because
it is tied only to the building
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Even when households have ability to move with a voucher
knowledge and jurisdictional barriers are significant
impediments to choice
% living in area of
concentrated poverty
Average
Income
Public housing resident
48%
$13,346
Assisted housing resident
26%
$11,504
Housing voucher recipient
19%
$12,755
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CHOICE NEIGHBORHOODS
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FY 2011 Budget
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FY 2012 Budget
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$100m for HOPE VI; up to $65m can be dedicated to Choice
Neighborhoods
President Obama requested $250 million for Choice
Neighborhoods
Authorizing Legislation
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Representative Waters introduced H.R. 762, which includes
Choice Neighborhoods
Senator Menendez introduced S. 624 on Choice Neighborhoods
WHERE IS PUBLIC HOUSING?
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