Housing Plus

Housing Plus

Guidance and legal insight for all aspects of housing and community development

By the Housing Group at Ballard Spahr

Federal Housing Finance Agency Proposes GSE Goals

Posted in FHA and GSE Financing, GSE Financing, Policy

The Federal Housing Finance Agency (“FHFA”) has proposed new single-family and multifamily housing goals for Fannie Mae and Freddie Mac (collectively, the “GSEs”) for 2018-2020.

For single-family housing, the proposed goals would require that the percentage of overall qualified single-family mortgage purchases for the GSEs be as follows: the Low-Income Home Purchase Goal would be 24%; the Very Low-Income Home Purchase Goal would be 6%; the Low-Income Areas Home Purchase Subgoal would be 15%; and the Low-Income Refinance Goal would be 21%. To meet these single-family housing goals, the single-family mortgages purchased must meet or exceed the benchmark level or the market level for that year.

For multifamily housing, the proposed goals would require that the GSEs purchase mortgages for multifamily properties (multifamily is defined as properties with five or more units) as follows: the Low-Income Goal would be 315,000 units; the Very Low-Income Goal would be 60,000 units; and the Low-Income Small Multifamily Subgoal would be 10,000 units. To meet these multifamily goals, the GSEs must meet these benchmarks outlined by FHFA.

FHFA’s website provides more details on the proposed goals, the timeline for submission of comments and a link to the Federal Register notice.  Comments are due September 5, 2017.

Ballard Spahr Honors Adrianne Todman

Posted in Community Development, Government-Assisted Housing

On July 12th, Ballard Spahr hosted a reception honoring Ms. Adrianne Todman and her new position as the Chief Executive Officer of the National Association of Housing and Redevelopment Officials (NAHRO). The event attracted over 50 predominantly female professionals in diverse affordable housing and community development practices across the nation.

Prior to joining NAHRO, Ms. Todman served as the Executive Director of the District of Columbia Housing Authority from 2009-2017. As the first female CEO in NAHRO’s 84 year history, Ms. Todman’s remarks to the audience highlighted her continued dedication to affordable housing, the importance of celebrating sisterhood, and the dynamic problem solving capabilities women bring to the housing industry.

Ballard Spahr wishes Ms. Todman great success in this new role, and we are excited to see all she will accomplish in the future.

 

        

       

 

Implementation of the Housing Choice Voucher Program under the 2017 Appropriations Act

Posted in Budget, Government-Assisted Housing, Public Housing, Section 8


On June 28, 2017, HUD issued Notice PIH 2017-10 (HA) (the “Notice”) providing guidance on the implementation of the Housing Choice Voucher (“HCV”) program funding provisions of the Consolidated Appropriations Act, 2017 (the “2017 Act”).

Under the 2017 Act, HUD received a total of $20,292,000,000 in funding for the Housing Choice Voucher program for the following budget items:

  • HAP Renewal Funding ($18,355,000,000)
  • Tenant Protection Vouchers ($110,000,000)
  • Administrative Fees ($1,650,000,000)
  • Mainstream 5 Year Program (120,000,000)
  • Tribal HUD-VASH Renewals ($7,000,000)
  • Veterans Affairs Supportive Housing ($40,000,000)
  • Family Unification Program ($10,000,000)

As evidenced in the Notice, the allocation methodology used to calculate housing assistance payments renewal funds, new incremental vouchers and administrative fees mostly continues the methodology established under the 2016 Consolidated Appropriations Act. We have highlighted some notable differences and new requirements below:

  1. The 2017 Act provides funding for Tribal HUD-VASH Renewals and the Family Unification Program. Per the Notice, further guidance for both programs will be issued at a later date. Guidance for the Tribal HUD-VASH Renewals will come from the Office of Native American Programs and a NOFA will be published directing the use of the Family Unification Funding.
  2. HUD is estimating that the $75 million dollar set-aside of HAP Renewal Funding will be necessary to prevent the termination of rental assistance for families as a result of insufficient funding of the voucher program. Applications for the other categories of set-aside funding: Unforeseen Circumstances, Portability Cost Increases, Project-Based Vouchers and HUD-VASH will not be accepted, unless there are remaining set-aside funds. The applications for shortfall funding will remain open throughout 2017, however PHA’s already within a Shortfall Protection Team with confirmed shortfalls in September, October or November of 2017 must submit an application no later than 5:00pm EST, Friday July 28, 2017 and those with confirmed shortfalls in December 2017, should submit an application no later than 5:00pm EST, Monday, January 22, 2018.
  3. The Tenant Protection Voucher set aside has also been increased to provide funding up to $110,000,000 to assist certain at-risk households in low-vacancy areas, who pay rents above 30% AMI as a result of certain conditions. The Notice clarifies that these TPVs are considered replacement vouchers and are not subject to the same re-issuance restrictions that apply to relocation vouchers. HUD noted that further guidance on the TPV set-aside is forthcoming and that until it is issued; HUD will not consider any applications for TPV set-aside funding.
  4. Section 6 of the Notice also provides significant detail on the process for awarding and applying for TPVs. It also explains under what circumstances tenants may be eligible for such vouchers.
  5. With respect to Administrative Fees, the Notice clarifies that no additional request may be made after the June 23rd deadline for Blended Rate Administrative Fees and Higher Administrative Fee Rates.

We will keep you posted as additional guidance is issued for these programs.

OIG Examines Travel and Travel Costs

Posted in Enforcement, Government-Assisted Housing, Policy, Uncategorized

In a new audit report, HUD’s Office of Inspector General (OIG) questioned certain costs paid by a public housing authority (PHA) for travel by the PHA’s commissioners.  The OIG alleges violations of uniform cost principals at 2 CFR Part 200, state open meeting laws, as well as the PHA’s own policies.  The report is a reminder to:

  • Remember that not all costs incurred while on official PHA business/educational travel are eligible for reimbursement with federal funds.  For example, PHAs should not reimburse commissioners or staff for alcoholic beverages purchased while on official business, even if other aspects of a meal are reimbursable. Although not addressed in this audit, many entertainment and social activity costs are also unallowable, though there are exceptions, such as situations in which such costs have a programmatic purpose.
  • Be mindful of a PHA’s internal policies pertaining to travel and reimbursements. The OIG and others will often look to internal policies to address situations that may be otherwise allowable under federal requirements.
  • Pay attention to potential conflict-of-interest situations. A PHA’s ACCs with HUD as well as procurement regulations and some state laws prohibit certain types of financial arrangements involving a PHA and its staff or commissioners. The ACCs in particular will prohibit these arrangements during and for one year after a commissioner’s tenure.

HUD Publishes Housing Trust FY 2017 Allocations

Posted in Budget, Legislative Initiatives, Uncategorized

The U.S. Department of Housing and Urban Development (“HUD”) released the Fiscal Year 2017 Housing Trust Fund (HTF) allocation amounts on June 20, 2017, setting forth the amounts awarded to each state or territory under the HTF.  The total HTF allocation for Fiscal Year 2017 is $219,168,373.94, including $12,702,747.00 in unallocated funds from Fiscal Year 2016. The formula HUD uses to allocate funds is enumerated at 24 CFR Part 93; and based foremost on the ratio of the shortage of standard rental units both affordable and available to extremely low-income renter households in the state or territory to the aggregate shortage of standard rental units both affordable and available to extremely low-income renter households in the United States, with each recipient granted a minimum annual award of $3,000,000.00.

 

Specific allocation amounts are can be found at FR Doc. 2017–13180 (https://www.gpo.gov/fdsys/pkg/FR-2017-06-23/pdf/2017-13180.pdf).

Ballard Spahr submits comments on HUD’s regulatory reform agenda

Posted in Policy

Ballard Spahr submitted comments in response to HUD’s request for assistance in identifying existing regulations that may be outdated, ineffective, or excessively burdensome.

Our comments take into account the uncertain funding environment housing authorities face. In such situations, it is only reasonable to reduce regulatory burdens so the funding can be targeted at providing and maintaining the housing infrastructure. At the same time, we are mindful of key statutory provisions and the need to maintain tenant protections as well as fair housing, civil rights, environmental, and wage rate requirements.

 

HUD Secretary States: RAD – “We need to lift the cap”

Posted in Government-Assisted Housing, Legislative Initiatives, Low Income Housing Tax Credits, Policy, Public Housing, RAD, Uncategorized

At the National Housing Conference 2017 Annual Policy Symposium on June 9, 2017, HUD Secretary Ben Carson delivered the keynote address and participated in a Q&A session with Chris Estes, President and CEO of NHC.  While much of the keynote address focused on homeownership issues, remarks made during the Q&A included such topics as the Rental Assistance Demonstration (RAD) program, Housing First, veterans housing, rural housing, fair housing, and the Federal Housing Administration. 

With respect to RAD, the Secretary called it the “perfect example” to leverage funds to provide more affordable units through public private partnerships.  He called for the lifting of the RAD cap on units (currently 225,000 units), as he described the program as a “win win situation” in the context of spreading funds further in light of fiscal constraints.  In emphasizing “enhancing public private partnerships,” the Secretary specifically mentioned the use of low-income housing tax credits.   

A recording of the Secretary’s remarks can be found here.  Remarks relating to RAD can be found beginning at time stamp 12:42 and also at 21:47.

 

 

HUD Regulatory Reform

Posted in Fair Housing, Government-Assisted Housing, Legislative Initiatives, Policy, Public Housing, Section 8, Senior Housing

The new HUD administration has been pretty quiet on the regulatory front, with only a handful of regulations and notices issued since January. That may change soon. HUD is hard at work identifying regulatory changes that might be made to comply with Executive Order (EO) 13771, “Reducing Regulation and Controlling Regulatory Costs.”  The EO requires that two regulations be eliminated for each new regulation issued and that the overall costs of new regulations, including repealed regulations, this year be zero. In February 2017, the Office of Management and Budget issued guidance for implementing the EO, and now HUD  seeks the public’s input into which regulations it could modify or eliminate.  Recommendations are due June 14, 2017.

Over the years, a number of groups and agencies have submitted recommendations to HUD for regulatory reform, and this is a good time to reconsider those proposals.  Since the request is for modifications to regulations, not statutes, recommendations should focus upon regulations and guidance that is not required by federal law.  Areas Ballard Spahr has been thinking about recommending changes include:

  • Better ways to implement prevailing wage rate requirements at mixed-use projects where the prevailing wages need not be paid for the full project;
  • Streamlining of the demolition/disposition process for public housing;
  • Modifications to site and neighborhood standards;
  • Modification of the public housing asset management rules;
  • Requirements for designation of public housing as elderly-only; and
  • Thoughtful modifications to affirmatively furthering fair housing requirements.

Request for IRS Guidance on LIHTC Issues

Posted in Low Income Housing Tax Credits, Policy

Last week at the annual meeting of the American Bar Association Forum on Affordable Housing and Community Development (Forum), Michael Novey, Associate Tax Legislative Counsel, Office of Tax Policy, U.S. Department of the Treasury, encouraged the Tax Credit Equity and Financing Committee of the Forum to consider submitting a request to the IRS for priority guidance on issues relating to the low-income housing tax credit (LIHTC). Based on discussions at the annual meeting, the Committee submitted its top five issues today, which can be found here.  Not only does the request provide background on the issues, it also describes why it is important for guidance to be provided now.

Each year the public is invited to submit recommendations to the IRS about what guidance would be helpful for the IRS to provide. This year’s notice from the IRS can be found here.  In past guidance plans, various LIHTC topics have been included, such as the right of first refusal under tax code Section 42(i)(7) and the federally or state assisted exception to the 10-year acquisition credit rule under tax code Section 42(d)(6).  Since the IRS has not yet provided formal guidance on these two important topics, they are among the issues included in the Committee’s request.

We will keep you posted if/when the IRS responds to these issues.

 

TOMORROW – June 1st – Revised RAD Forms Must Be Used

Posted in Public Housing, RAD, Section 8

Earlier in May, HUD received approval from the Office of Management and Budget of the final, revised form RAD documents. HUD had previously solicited two rounds of public comment as part of the Paperwork Reduction Act process.  Ballard’s comments to HUD’s first solicitation of comments can be found here and our comments to the second round here. The final, revised form documents reflect HUD’s incorporation of many of the submitted comments – including comments received as part of the second round of public comment in October 2016.

The May 11th RADBlast! indicates that the revised forms must be utilized for any closing package submitted to HUD on or after June 1, 2017. Many of the revised RAD documents are available in Word format on HUD’s RAD website and both the old and new forms are available on the RAD Resource Desk. For the convenience of our readers, we’ve uploaded copies of the final, revised forms for public housing RAD conversions (RAD First Component) compared to the prior form documents – and you’ll immediately notice the riders to RAD Use Agreement and the HAP Contracts have been incorporated into the body of the respected documents:

If you’ve been following the progression of the revised RAD documents and would like to see the changes made to the documents since they were published for comment in October 2016, please contact me (mohra@ballardspahr.com or 410.528.5337)  and I will be happy to send you comparison copies of these interim revisions.

Overall, HUD was receptive to stakeholder comments and the revised documents reflect the collective knowledge gleaned over the last five years. We look forward to continuing to advance the RAD program.