Housing Trust Funds Mary E. Brooks Housing Trust Fund Project Center for Community Change 1113 Cougar Court Frazier Park, CA

Housing Trust Funds: advancing how we fund affordable housing Securing dedicated sources of public revenue. Committing that revenue to support critical housing needs.

Today … there are 600 housing trust funds

There are 38 states with housing trust funds

Homeless Trust Funds Other housing trust funds commit some resources to address the needs of the homeless population. Ten year plans to end homelessness are connecting to housing trust funds. Homeless trust funds have been created in Washington; Nebraska; New Jersey; Georgia; Wisconsin; Dade County, FL; Kalamazoo City & County, MI; and counties in Missouri.

How Housing Trust Funds Work Legislation or Ordinance Establishes the Housing Trust Fund Administration Agency or Department Oversight Board Programs Distribution of Funds Program Requirements Eligible Applicants Eligible Uses Dedicated Revenue Sources Taxes or Fees Program Generated Revenue Interest Earned Other Revenues

Administration  Virtually all housing trust funds are administered by staff of a public agency or department.  Most housing trust funds have some kind of oversight board. They may be either decision-making or advisory boards. These boards are appointed and have broad representation from the affordable housing community.  Administrative costs can be paid from trust fund revenues or other public funds.

Programs Funds are awarded either through a request for proposal process; a notification of funding availability; or direct funding of specific programs. Funds are available either as grants or loans and/or other sources of financing. The application process may be combined with other available sources of affordable housing funds, such as: HOME, CDBG, etc.

Program Requirements Eligible Applicants: nonprofit developers, for-profit developers, housing authorities, governments, Native American tribes, etc. Eligible Uses: acquisition, new construction, rehabilitation, predevelopment costs, housing related services, operating costs, capacity building, rental assistance, foreclosure assistance, etc. Application Requirements: income targeting to control who benefits, long term affordability, accessibility, leveraging, etc.

States Commit Public Revenue Sources Real estate transfer tax Florida, Hawaii, Illinois, Maine, Nebraska, Nevada, New Jersey, South Carolina, Vermont Interest from escrow accounts Connecticut, Maryland, Minnesota, Washington, Wisconsin Document recording fees Delaware, Illinois, Kentucky, Missouri, Ohio, Washington Lottery earnings Oregon Interest from Unclaimed, Unnamed Property Fund Arizona Bond and fee revenues Kansas, Nevada, New Hampshire Capital budget funds Washington

State Housing Trust Fund Revenues

Top $ State Housing Trust Funds Florida: Documentary stamp tax New Jersey: Real estate transfer tax District of Columbia: Deed recordation & transfer tax Illinois: Real estate transfer tax Washington: Capitol budget New Jersey SN: Bonds backed by traffic fines Ohio: Document recording fee Arizona: Unnamed, unclaimed property fund Illinois RS: Document recording fee

Cities and Counties Commit Dozens of New Revenue Sources  document recording fees  real estate excise tax  sale of government owned land  condominium conversion fees  contributions from tax- exempt mortgage revenue bond projects  hotel/motel taxes  filing fees property sales disclosure forms  building permit fees  real estate transfer taxes  impact fee on new commercial construction  tax increment revenues  parking garage proceeds  restaurant tax  inclusionary zoning in-lieu fees  property tax  sales tax  court settlements  casino revenues

City Housing Trust Funds Revenue Generated

County Housing Trust Funds Revenues Generated

Why Dedicate Public Revenues to Affordable Housing Affordable housing is fundamental to the health of any city. The private market cannot respond to homes that require subsidies. Affordable housing needs are constant as long as wages continue to lag behind. Affordable housing requires long-term planning and investment. Affordable housing cannot be dependent on budget surpluses.

States with Enabling Legislation

California and Iowa Fund Local Housing Trust Funds California voters approve bond initiative that includes $25 million for local housing trust funds. Iowa passes legislation committing $800,000 to local housing trust funds. Affordable housing in California

Pennsylvania Act 137 Enables county commissioners to double recording fees for deeds and mortgages. At least 85% must be set aside in a separate account. Funds must be used to support affordable housing efforts in the county. 15% may be used for administrative costs associated with affordable housing.

Washington Enables Local Housing Trust Funds Washington HB2060 authorizes an increase in the document recording fee charged by counties. 60% of the funds stay with counties and 40% goes into state fund for operating and maintenance costs of housing serving very low income persons. 27 counties have responded

Washington D.C. Housing Production Trust Fund Created in 2001 with revenues from the deed and recordation taxes. More than 5,000 units have been supported. 40% goes to very low income households.

Ohio Housing Trust Fund Dedicates the recordation fee for state’s trust fund, capped at $50 million annual revenue. A majority of the funds serve those earning no more than 50% of the area median income. In FY2005: home repair of 1,972 units; supportive services with housing for 5,632 persons; down payment assistance for 289 households; and construction of 977 homes.

Illinois Affordable Housing Trust Fund o Created in 1989 and receives 50% of the state’s real estate transfer tax revenues providing as much as $60 million annually. o Funds new construction and rehabilitation; down payment/closing cost program; owner-occupied rehab program; and multi-family projects.

Washington Housing Trust Fund Created in 1987 to fill the gap created by diminishing federal funds. Has invested more than $420 million in housing creating 26,500 homes. Bryant House Leveraged more than $1,660 million in private and public sector support.

Missouri Housing Trust Fund  Created in Receives document recording fee revenue of approximately $6 million each year.  Uses a consolidated application form for the Housing Trust Fund, HOME funds, and other MHDC fund balances.  Addresses housing needs of those earning no more than 50% of area median income with half of the funds serving 25% of ami.  Last year, they assisted more than 200 housing programs.

South Carolina Housing Trust Fund Commits $16 million a year to: Emergency repair Owner occupied rehabilitation; Homeownership; Acquisition; Rental; Supportive housing; and Group homes. Collects revenues from the state real estate transfer tax.

Arizona Housing Trust Fund Created in 1988 with revenues from the 35% of the state’s unnamed, unclaimed property fund. Since 1998, the Fund has received 55% of the fund contingent on the additional funds being dedicated to rural areas of the state. The Fund receives about $20 million annually in dedicated revenues.

Vermont’s Housing and Conservation Board Funded through a dedicated portion of the Property transfer tax and Capital Bond funds, along with General Fund surpluses. Celebrating its 20 th anniversary: $200 million in grants and loans; More than 1,200 projects in 220 towns; $750 million leveraged from other private and public sources; 8,500 units of affordable housing created and/or preserved. Dual purpose of supporting affordable housing and conserving open space and agricultural lands.

Housing Trust Funds Mary E. Brooks Housing Trust Fund Project Center for Community Change 1113 Cougar Court Frazier Park, CA

Chicago Creates Low Income Housing Trust Fund All funding supports households earning 30% of area median income or less. Funds also support homeless initiatives and essential services. Chicago Department of Housing A majority of the funds provide rental assistance.

Illinois Rental Housing Support Program Grants to local administering agencies to provide subsidies to landlords that will make housing units affordable. Grants to developers to provide long- term operating support for housing. Units must serve extremely and severely low income households. At least 10% must serve long term operating support and 20% to rural areas.

New Jersey Special Needs Housing Trust Fund Funded with $200 million commitment of bonds backed by proceeds from moving motor vehicle surcharges. Funds are used to develop permanent supportive and other housing for persons with special needs. Its goal is to help create 10,000 new meaningful affordable housing alternatives.

Nebraska Homeless Assistance Program Combines NHAP and HUD’s Emergency Shelter Grant Program. In 2004, the Program provided nearly $2,500,000 from NHAP and another $300,000 from ESGP. Programs support housing, crisis centers, youth services, temporary housing, and much more. About NHAP History, Purpose & Funding Priorities of Nebraska Homeless Assistance Program History of Nebraska Commission on Housing & Homelessness Continuums of Care Hunger & Homeless Week Funding, Application for Funding, and Reporting Nebraska's Plan to Address Homelessness Rental Housing Search Useful Links

Georgia Trust Fund for the Homeless Provided $900,000 to supplement Shelter Plus Care funds from HUD. Supported the development of “Progressive Hope House” (a 70-bed substance abuse treatment facility). Made staff support available to develop a State continuum of Care Plan, resulting $9.2 million dollars in funding for 28 projects state-wide. Advanced the state’s system of permanent supported housing for persons with disabilities, especially those with long homelessness.

Dade County, Florida Homeless Trust Created in 1993 to increase the availability of housing and services to the homeless population. Approximately $37 million a year: food and beverage tax ($11 million); HUD funding ($20 million); state and private sector contributions. Partners with Community Partnership for Homeless creating Homeless Assistance Centers.

Washington Homelessness Housing and Assistance Program $45 million annually from document recording fees (HB 2163 and HB 1359); 60% stays with counties for ten year plan implementation; 40% goes to the state’s Homelessness Grant Assistance Program; Ten counties will implement projects to reduce homelessness demonstrating systems change through integration with criminal justice, social service, health, and other state and local systems; and In 2007, will introduce peer-to-peer assistance model among HGAP awardees.

St. Louis County, Missouri Homeless Service Program  The Emergency Shelter Hotline.  Referrals to emergency shelter, rent/mortgage/utility assistance, or other service referrals.  The Hotline is jointly funded by the City of Saint Louis and Saint Louis County.  A course of action to return them to permanent housing and independence.  Six social service agencies administer grants; conduct classes; identify available, affordable housing; and follow-up with families to prevent housing crisis.

Active and emerging housing trust fund campaigns

Housing trust funds give affordable housing a new face Recognize that the most critical housing needs must be addressed. Incorporate sustainable housing principles: accessibility, long- term affordability, green housing. Leverage funding ($1:$5-10) bringing in additional resources to Louisville.

Housing is good for the Economy The argument shifts … NAHB documents 1,000 multi-family homes generates 1,000+ full time jobs, $33.5 million in wages, and $17.8 million in tax revenues and fees. Lee County, Florida documented that the need for more affordable housing costs the County more than $249 million annually! The economic impact of Philadelphia’s trust fund is expected to reach: Nearly 2,600 jobs statewide each year. $80 million in wages every year. Increased city and state taxes.

Economic Benefits of a Colorado Housing Trust Fund An investment of $26.5 million would produce:  More than 3,200 new jobs each year.  More than $334 million of economic activity each year.  Formerly rent-burdened households will have an average of $2,460 of annual income per household to spend.  New economic activity will generate more than $26 million of annual tax revenues. An Investment in Colorado’s Future

Housing is Good for Communities Health: Pest infestation is known to cause asthma. Substandard electrical problems are a danger to children. Lead poisoning leads to a decrease in IQs. Children living in inadequate housing have increased hospitalizations and respiratory infections. Education: Higher school-mobility rates affect the entire system and cause the most harm to children whose families have low incomes. Housing instability can have a direct impact on a child’s education. Frequent moves can have a negative effect on school achievement.

Reframing the Affordable Housing Debate Affordable housing is at the heart of a healthy community. Connect housing to other issues: wages, health, education. It’s not about the money; it’s about priorities. We Need the People Who Need Affordable Housing

Another rent increase. Another new neighborhood. Another year behind in school. HousingMinnesota

The Sustainability of Housing Trust Funds  An on-going government commitment of public funds.  A community-based process to create and sustain the fund.  A component of housing policy that drives innovation and cooperation.  A flexible model that can adapt to changing market conditions.