Affordable Housing Program Update NCDA Conference January 21, 2016

Housing Trust Fund HTF is here!  Housing Trust Fund established by HERA in GSEs must deposit portion of 4.2 basis points of $1 of unpaid principal balance of total new business purchases into HTF.  FHFA suspended these deposits indefinitely due to financial viability of GSEs. In December 2014, FHFA terminated this suspension beginning with GSE financial statements due by 2/28/16. Formula allocations will be published in April. 2

Housing Trust Fund Estimates of amount available vary. Funds will be sufficient to provide statutory $3 million minimum for each State. States should be planning for HTF administration, including the citizen participation process and HTF allocation plan development and submission. 3

HOME FY 2015 Accomplishments 4 30,718 HOME units completed 14,779 rental units (48.1%) 10,481 homebuyer units (34.1%) 5,458 homeowner rehab units (17.8%) 11,935 households assisted with TBRA

HOME Five-Year Accomplishments 5 FY 2011FY 2012FY 2013FY 2014FY 2015 Rental Units39,16228,77920,92920,54014,779 Homebuyer Units21,59320,12915,35012,85410,481 Homeowner rehab Units9,1379,01710,5476,4315,458 Total units Completed69,89257,92546,82639,82530,718 TBRA Households Assisted15,68315,92912,36311,74411,935

FY 2016 HOME Budget HOME FY 2016 Appropriation: $950 Million Good News: $50 million increase from FY House passed $767 (+ HTF funds) Senate passed $66 million Reality: This is still a 47% decrease since FY 2010 – which has consequences for the program nationally. 6

Legislative Changes – FY Day Notice for Eviction/Non-Renewal HOME tenants required to be provided 30 days written notice of eviction or decision not to renew lease – NO EXCEPTIONS. FY 16 law establishes an exception to 30 day notice requirement if a tenant poses “a direct threat to the safety of the tenants or employees of the housing, or an imminent and serious threat to the property.” State and local eviction laws must be followed. 7

Legislative Changes – FY 16 Community Land Trust Provision HOME homebuyer units under a RESALE provision must be transferred to another low- income buyer. Rights of first refusal not permitted except for the PJ. FY 16 law permits CLTs to exercise purchase options, rights of first refusal or other preemptive rights to purchase to preserve affordability of the housing. 8

Emerging Challenges Commitments – even before the change from cumulative to grant-specific commitments, deobligations are increasing substantially. HUD deobligated $26.6 million for failure to commit in FY 2015, compared to just $5.3 million in FY 2012 and $11.4 in FY New regulations, difficult market conditions, diminished PJ staffing/capacity are causes. 9

Emerging Challenges Expiring Affordability/Lower Production– Affordability periods on HOME rental projects completed early in the program are expiring. Reduction in HOME appropriation has resulted in net loss of affordable housing. For the first time, in FY 15, # of new HOME rental units completed < # w/expiring affordability period. PJs have fewer options for recapitalizing HOME projects or replace lost units with new HOME units. 10

HOME Rulemaking Update HUD is drafting regulations implementing the grant-specific method of measuring HOME commitments: – Required by GAO Decision: “cumulative method” violates HOME statute Property Standards, Inspections, Utility Allowances – Delayed - stay tuned for further guidance. 11

New HOME Notices  Maximum Per-Unit Subsidy Limits  Requirements for Committing HOME Funds  Webinar planned  HOME Underwriting and Subsidy Layering Guidelines  Webinar planned 12

Upcoming HOME Notices Cost Allocation Homebuyer Policies and Underwriting Match CHDOs For information on HOME training, policy guidance, TA products, visit Sign up for HOME listserv 13

Upcoming HOME Training and TA 3 Web-Based Building HOME deliveries – Live webinar series with office hours CHDO Training (for CHDOs and PJs) – PJ Peer Groups – CHDO Basics; Organizational Planning for CHDOs; Homebuyer Development for CHDOs; Rental Development for CHDOs; Strategic Management for CHDOs 14