Announcements Archives

HAC Comments to HUD on the Proposed Changes to the HOME Rule

February 2, 2012/in Announcements

In response to HUD’s proposed changes to the HOME regulations HAC has prepared a draft set of observations and comments to those particular suggestions which we feel will have the most significant impact on rural communities and the organizations that serve them. This list is not exhaustive by any means, but we hope you find it useful in helping you think through how the proposed regulations changes will impact your work and community. If it is helpful, here is the link to the official HUD proposed rule presentation and summary, https://www.hometa.info/.

Please share your thoughts with us. Please be brief, and we will try to reflect them in our official response letter to HUD. We are looking for a quick turnaround; please submit your comments to Dan Stern, dan@ruralhome.org by COB, Wednesday, February 8^th or comment on HAC’s LinkedIn page or on Twitter #HOMERules. We will post our final letter on our website. We look forward to your input.

Select observations and comments:

1. CHDO Capacity Requirements (Section 92.2)

The proposed regulation requires CHDOs to demonstrate internal capacity to develop proposed projects with virtually no external assistance. This is concerning for all CHDOs, but most particularly rural organizations, where internal capacity is frequently limited to one staff person and new hires where the required ‘demonstrated development experience’ may be impossible. The rule explicitly prohibits the use of consultants and volunteer labor to demonstrate capacity.

2. CHDOs Sponsored by Governmental Entities (Section 92.2)

The proposed regulation restricts the control of a CHDO by a governmental entity. A number of CHDOs were created by: local housing authorities (LHAs), council of governments (CoGs), regional planning commissions (RPCs), and tribal entities (TDHEs) which are frequently incorporated as governmental entities. Permitting LHAs, COGs, RPCs, and TDHEs to spin off CHDO arms are beneficial to all parties as long as the governmental entity is unrelated to the PJ and has separation from political influence. The ability to use shared staff, shared office space, and participation on the board has proven beneficial to the creation of strong CHDOs. Disallowing these relationships can have direct impacts on these CHDOs’ capacity to survive without the in-kind support.

3. Reduced Timeline for Income Determination (Section 92.203)

“A minimum examination period of 3 months should be sufficient to accurately reflect the income eligibility of applicants for HOME units”. This could potentially have an impact on low-income persons with seasonal or inconsistent income.

Message From HAC

Dear Rural Development Stakeholder:

The Housing Assistance Council (HAC) seeks your feedback on HUD’s proposed regulation changes for the HOME Program, particularly on how they may impact rural communities, otherwise considered non-entitlement jurisdictions. We have shared our draft observations and comments with several stakeholders and want to share it with you. We want to make sure your voices are being heard at this important opportunity to comment on HUD’s proposed changes. While many of the comments we are sharing speak to issues that impact both metro and rural communities we want to ensure that we are highlighting the potential results that these changes will have on non-metropolitan areas. Please share your thoughts….please be brief…. and we will review them for possible inclusion in our official letter to HUD responding to their proposed regulations changes. We are looking for a quick turnaround; please submit your comments to Dan Stern, dan@ruralhome.org by COB, Wednesday, February 8^th or comment on HAC’s LinkedIn page or on Twitter #HOMERules. We will post our final letter on our website.

Also, the link to HUD’s summary and presentation on the proposed HOME regulation changes is https://www.hometa.info/.

We look forward to your input.

Sincerely,

Jeff Mosley
Director, Training and Technical Assistance Division

4. Development Timeline Condensed ((Section 92.205)

The proposed regulation reduces the PJs time to commit funds from 2 years to 1 year and the time for organizations to develop from 5 years to 4 years. The regulation allows the PJ to request a 12 month extension to complete pending approval by HUD officials. Failure to meet the timeline requirement will require the PJ to repay HOME funds invested in the project. For rural projects, where the need to assemble an array of affordable financing and grant resources and arrange the timing of these commitments is often difficult and time consuming, the proposed timeframes may have a substantial negative impact.

5. Inspection Fees (Section 92.214)

While HUD is prohibiting organizations from charging fees to homebuyers and tenants, it will begin permitting PJs to charge inspection fees for annual compliance monitoring visits. The proposed regulation provided does not give guidance on cost reasonableness of the fees.

6. Prohibition to Charging Fees to Homebuyers (Section 92.214)

Under the proposed rule organizations would not be permitted to charge fees to the family for HOME homeownership assistance it provides. In addition, the PJs would be required to determine that the fees and other amounts charged to the family by the lender for the first mortgage financing are reasonable, based upon industry practice in the area, and ensuring that the family is not being charged fees for a HOME-funded activity. HUD should clarify that, while it requires homebuyers receiving HOME assistance to receive pre-purchase counseling, organizations can or cannot include Housing Counseling an ineligible project cost under the HOME program; many organizations charge a nominal fee on the HUD-1 to cover a portion of expenses. A question is whether organizations that serve as approved, or certified loan packagers, for conventional, governmental or other nonprofit agencies can charge packaging or brokerage fees if HOME assistance is part of the construction or homebuyer financing.

7. Leasing Up Rental Properties/Troubled Rental Projects (Section 92.252, 210)

Rental units which have not been leased within 3-6 months will be required to report to HUD marketing plans. If efforts to market the unit are unsuccessful and a unit is not occupied by an initial tenant after 18 months, HUD would require repayment of HOME funds invested in the units but the project owner must maintain compliance and affordability throughout the original performance period.

8. Tenant and Homebuyer Preferences (Section 92.253)

The proposed rule limits permits PJs to limit the beneficiaries or give preferences to a particular segment of the low-income population only if described in the action plan and it doesn’t violate fair housing. Limiting beneficiaries or giving preferences to such professions as police officers, teachers, or artists are eligible. Employees of the PJ are not eligible for preferences.

Additionally, a project may have a limitation or preference for people with disabilities who need services offered at a project only if:

· it is limited to households with disabilities that significantly interfere with their ability to obtain and maintain housing;

· the households will not be able to maintain themselves in housing without appropriate supportive services; and,

· the needed services cannot be provided in a non-segregated setting.

However the regulation enforces the current practice to allow a HOME projects to restrict program beneficiaries when the project includes leveraged funds from categorically excluded programs, such as 202, 811 and HOPWA.

9. Initial Purchase Price Limit (Section 92.254)

HUD has proposed language for non-metro communities, exempting them from the 95 percent of area median purchase price standard for newly constructed homes, allowing states to aggregate sales data from at least two contiguously connected counties with similar attributes to use as the alternative benchmark. First, HUD should consider allowing states to either adopt this as a standard, use the 95 percentile of the U.S. median purchase price for new construction in non-metro areas, or other options that would ensure the eligibility of newly constructed homes. States would have to publish the standard they choose in their Action Plans. Second, HUD and the states should address how the purchase price limits would apply to homeowner rehab sales. How does the proposed purchase price limit impact developers’ ability to acquire/rehab and sell existing stock in low-value markets? The standard should, just as with new construction, allow for maximum flexibility to generate sales for income eligible and credit-worthy families.

10. Fee Simple Absolute Titles (Section 92.300)

To qualify as a CHDO for a HOME-funded project as an owner or sponsor the nonprofit must own the property under Fee Simple Absolute title. Staff is concerned that such a narrow definition may impede or prohibit CHDO development on Native American Lands or in existing CLTs.

11. Profit/Nonprofit Partnerships in LIHTC Deals (Section 92.300)

The proposed rule states that for a project to qualify for CHDO funds, the CHDO must be the sole general partner. It will result in a significant change in participation of many CHDOs, particularly those that are rural, in the LIHTC program. The resulting partnerships, in particular, with equity and other capital/development partners may not be beneficial to CHDOs seeking fees, capacity or other upside to its participation beyond the delivery of affordable rental housing.

This list is not exhaustive and any statements that are inaccurate are unintentional; please refer to the official HUD proposed HOME regulations for complete documentation. If there is a topic that we did not highlight that you think is critical please make sure to submit your comment. Comments may also include topics that you think should be included in the proposed HOME regulations that currently are not proposed or discussed.

Thank you for your interest and assistance in helping HAC ensure that HUD receives thorough feedback on how the proposed Rule changes impacts the communities we serve.

Download a PDF of this Announcement

Posted: February 3, 2012

USDA to Close 43 RD Offices as Part of New "Blueprint for Stronger Service"

January 10, 2012/in Announcements

On January 9, 2012, USDA unveiled a Blueprint for Stronger Service that includes closing 43 Rural Development (RD) field offices in 17 states. A total of 259 USDA agency offices, facilities, and labs will be closed nationwide.

A USDA fact sheet summarizes the Blueprint’s impacts on RD, and lists the 43 counties that will lose RD offices:

Alabama: Houston County
Arizona: Mohave County
Arkansas: Izard, Faulkner, Hot Spring, White, and Sevier Counties
Delaware: Kent and Sussex Counties
Hawaii: 1)(Kosrae, Chuuk, and Yap), and 2) Hawaii County
Indiana: Monroe, Tippecanoe, LaPorte, and Marshall Counties
Louisiana: Livingston County
Maryland: Calvert, Garrett, and Worcester Counties
Mississippi: DeSoto County
Missouri: Jasper, Jefferson, Cape Girardeau, and Cole Counties
North Carolina: Burke, Chowan, and Caswell Counties
Oklahoma: Pushmataha and Pittsburg Counties
Pennsylvania: Juniata County
South Carolina: Richland and Sumter Counties
Tennessee: Anderson, Bedford, Bledsoe, Cannon, Carter, Cocke, Humphreys, Sevier, and Trousdale Counties
Virginia: Essex County
Wyoming: Park County

“In some cases, offices are no longer staffed or have a very small staff of one or two people,” USDA Secretary Tom Vilsack explains in a blog post. “Many are within 20 miles of other USDA offices. In other cases, technology improvements, advanced service centers, and broadband service have reduced some need for brick and mortar facilities.”

In 1980, the Farmers Home Administration (FmHA) had “46 state offices, 264 district offices, and 1,904 county offices plus the National office in Washington, D.C.”¹ By March 1998, after FmHA staff had been combined with business and utilities staff in a major reorganization, Rural Development had only 815 county offices.² USDA’s Blueprint states that after the additional 43 offices are closed, “more than 450 RD offices remain.” It is not clear whether these 450 include state offices.

Secretary Vilsack’s blog post asserts that the Blueprint’s “end result is a plan that will create optimal use of USDA’s employees, better results for USDA customers, and greater efficiencies for American taxpayers.”

Notes

1. A Brief History of Farmers Home Administration. USDA, Farmers Home Administration. Washington: Government Printing Office, January 1990.

2. USDA: Status of Closing and Consolidating County Offices. Washington: General Accounting Office (GAO/T-RCED-98-250), July 29, 1998, Table 1.

Posted: January 10, 2012

"Pinky" Clifford Speaks Out on Housing Conditions on Pine Ridge Reservation

December 2, 2011/in Announcements

In a radio story titled “Generations of Housing Red Tape,” a family returns to the Pine Ridge Reservation in South Dakota only to experience difficulty finding a decent place to live. American Public Media’s Marketplace reporters chronicle the Hawk family and highlight the ongoing housing challenges on the reservation. HAC Partner, Emma “Pinky” Clifford, Director of the Oglala Sioux Tribe Partnership for Housing, shares her insights and experiences working to meet housing needs in this high need region.

To hear the story and see pictures of the Pine Ridge Reservation, visit

https://www.marketplace.org/topics/economy/economy-40/generations-housing-red-tape

Posted: December 2, 2011

Email down

November 22, 2011/in Announcements

HAC Is experiencing email difficulties

Due to unforeseen outside influences HAC’s email system is down in all of its offices. If you need to reach someone immediately please phone them. We working to correct this problem. Sorry for the inconvenience.

Information about contacting HAC staff is available here.

_______________________

Posted: June18, 2012

If you have problems accessing any of the material on this page, contact Dan Stern, 202-842-8600 ext. 137.

Amendment Would Slash Rural Development Funding

October 26, 2011/in Announcements

AMENDMENT WOULD SLASH RURAL DEVELOPMENT FUNDING

The National Rural Housing Coalition has organized a sign on letter opposing the Coburn Amendment, which may come up in the Senate next week and would cut USDA Rural Development funds for 2012 by $1 billion. This cut would amount to 40% of RD programs and would be across all the agency’s functions. The Coalition’s letter has more information and is at the following link — https://org2.democracyinaction.org/o/5172/p/dia/action/public/?action_KEY=8587The sign on deadline is Friday, October 28.

Posted: October 26, 2011

RSH Grant Announcement

September 30, 2011/in Announcements

Rural Senior Housing Fund Application

The Housing Assistance Council (HAC) is pleased to announce a new grant program, the Rural Senior Housing (RSH) Fund. Eligible affordable housing organizations can apply for RSH grants to support activities that will build, preserve, or advocate for housing for low-income seniors (62 and older) living in rural areas. This new program is made possible through the generous support of The Atlantic Philanthropies.

The Applications period closed December 15. Please look for another application period in fall 2012. Sign up as a stakeholder to received program announcements and updates.

If you have any questions about the application or the RSH FUND, please contact Janice Clark, 202.842.8600 x 131 or email Janice@ruralhome.org.

Visit HAC’s Rural Senior Housing Initiative Page for updates from the program.

NALCAB Now Accepting Applications for Asset Building Grants

September 20, 2011/in Announcements

With generous support from Sam’s Club, the Open Society Foundation and the Northwest Area Foundation, NALCAB is providing subgrants ranging from $5,000-$20,000 to organizations meeting requirements outlined in the request for proposal (RFP) – https://cts.vresp.com/c/?NALCAB/c66a00974c/43478e6510/96625b35bc.

Grants are for a 12 month period beginning on or about November 1, 2011. With a single application, organizations may apply for funding from one or more of the three pools of funds that are available, based on their specific eligibility requirement.

Eligible groups are asset building nonprofit organizations located in the Northwest, Midwest, Southeast, and organizations providing entrepreneurship and small business development throughout the nation. Specific geographic or program priority is detailed in the RFP.

NALCAB seeks organizations that are building capacity in one or more of the following areas:

Real estate development for low-income people and communities including affordable housing and community facilities
Micro/Small Business Development
Providing family wealth building products andservices (including financial education)

The objective of these sub-grants is to strengthen the organizational capacity of participating entities to measurably advance existing asset building projects. In addition to grant funding, NALCAB will provide grantees with technical assistance in program/ project development and with leveraging other sources of funding for the identified project or program.Applications should be received no later than midnight PST on October 7, 2011 and may be submitted via email to Carol Rodriguez, Senior Program Manager at crodriguez@nalcab.org or U.S Postal Service.

USDA Rural Housing Programs for Seniors

September 12, 2011/in Announcements

Fiscal year 2012 funding is seriously threatened for U.S. Department of Agriculture (USDA) housing programs that maintain or create affordable housing options for elders in rural areas. Programs of other agencies – for example, the Section 202 program of the Department of Housing and Urban Development (HUD), weatherization programs, and the Low Income Housing Tax Credit – are also relevant in rural America. Several of them, including HUD’s 202 program and key USDA programs, have already seen steep budget cuts, drastically reducing their effectiveness in serving rural seniors. Congress should continue to fund these important programs at least at their 2011 levels.

Section 515 rental housing. This program has been the mainstay of USDA’s efforts to serve the poorest of the rural poor, including extremely low-income rural seniors, since 1963. The Section 515 program provides mortgage loans to develop rental housing for low-income households and is often used in conjunction with Low Income Housing Tax Credits. The program has proven extremely successful at providing decent, affordable housing for the lowest income rural seniors. Nearly 60 percent of Section 515 residents are elderly or have disabilities. Their average annual income is about $11,000. They have few other housing options.

Funding for Section 515 has been cut drastically over the past 17 years, sharply reducing production. The USDA appropriations bill passed by the House before the deficit reduction deal, H.R. 2112, would reduce program funding still further, from $69.5 million in FY11 to $58.6 million in FY12. The very low-income tenants served by Section 515 should not bear the burden of reductions in government spending: the program should remain at its FY11 funding level.

Rental housing preservation. The majority of rental units produced using USDA’s Section 515 rental program and Section 514/516 farmworker housing program are more than 20 years old. They need repairs and updates to preserve the taxpayers’ investments. To assist preservation efforts, several years ago Congress created the Multifamily Preservation and Revitalization (MPR) program and the Preservation Revolving Loan Fund (PRLF).

The very popular MPR program uses a range of financing tools to help owners afford to improve their USDA-funded rental properties. Most often, it enables USDA to defer owners’ payments of mortgage principal. The Preservation Revolving Loan Fund, as its name suggests, provides loans to owners or purchasers for preservation of USDA rental properties.

Both the President’s budget for FY12 and H.R. 2112 would eliminate all funding for MPR and the PRLF. The budget – although not H.R. 2112 – would add some Section 515 funding to be used for preservation, but Section 515 funds are not as flexible as MPR’s. For example, under Section 515 USDA cannot defer principal payments. Both preservation programs should be funded at FY11 levels: $15 million for MPR and $1 million for PRLF.

Rental Assistance. USDA’s Section 521 Rental Assistance (RA) program helps tenants whose incomes are so low they cannot afford the rent in a Section 515 or 514/516 property. Rental Assistance is available only to tenants in USDA-financed properties and is an essential part of providing decent, affordable homes for the very lowest income rural Americans.

Both the Administration’s budget and H.R. 2112 would reduce Rental Assistance funding. The budget’s congressional justification assumes that more than 300 properties will leave USDA’s multifamily portfolio in 2012 because of irresponsible owners or prepayments. This would be a very significant increase over past years; in FY10, for example, the mortgages on 86 properties were prepaid, and the highest number prepaid in any year was 152 in 2004.

Given the average 27 units per property in the portfolio, and the fact that 60 percent of USDA’s tenants are elderly or disabled, it is estimated that over 8,100 tenant households – more than 4,800 of them elderly or disabled – would lose their homes and their Rental Assistance if USDA’s calculation is correct. It is hard to believe that these tenants will find other affordable housing. HUD’s recently released Worst Case Needs Report estimated there are already 7.1 million renter households with serious housing needs not receiving assistance. With such a large number already unable to find decent, affordable housing or to obtain assistance, there is no reason to believe that displaced USDA tenants would fare any better.

Section 504 repair grants and loans. With these small loans and grants from USDA, many very poor elderly recipients for the first time in their lives can have an indoor toilet, a sound roof, or a modern furnace. Maximum amounts are $7,500 for grants (for very low-income elderly only) and $20,000 for loans (for very low-income homeowners regardless of age). This is hardly an extravagant program. In 2010 its funding was $32 million for grants and $34 million for loans (which are repaid).

The budget and H.R. 2112 would eliminate Section 504 loans entirely. The budget would cut Section 504 grant funding significantly, although H.R. 2112 would maintain funding at the FY11 level. Like other USDA housing programs, the Section 504 programs should be funded at their FY11 levels, $30 million for grants and $23.4 million for loans.

Published September 2, 2011

Proposal to Move RHS to HUD

September 9, 2011/in Announcements

Trevino repeats opposition to proposal

At a September 13, 2011 hearing before the House Agriculture Committee’s Rural Development subcommittee, rural housing administrator Tammye Trevino was asked about the proposal to move USDA’s Rural Housing Service to HUD. She made clear that the move was not proposed by the Administration and that the Administration opposed it.

Second Hearing held on proposal to move RHS to HUD

On September 8, 2011 the House Financial Services Committee’s housing subcommittee held its second hearing on the draft bill that would move USDA’s Rural Housing Service (RHS) to HUD. The bill, which would also make changes to the Federal Housing Administration (FHA) and Ginnie Mae, has not yet been introduced.

At the first hearing on May 25, 2011 Peter Carey testified for HAC, Self-Help Enterprises, and the National Rural Housing Coalition, opposing the move. The other witnesses at that hearing represented a variety of nonprofit and for-profit entities, most of them interested in FHA issues. The September 8 hearing featured agency representatives. Trevino Trevino, RHS Administrator, was one of the witnesses, along with Sen. Johnny Isakson (R-GA), Carol Galante from HUD/FHA, and Theodore Tozer from Ginnie Mae.

Both Tammye Trevino and Carol Galante testified against the move to HUD. Tammye described RHS’s knowledge of rural issues and its field network of rural offices. She pointed out that RHS, HUD, and other agencies are already working together to “align” their rental programs by using common forms, accepting each other’s inspections, and the like, and she mentioned that a similar effort for homeownership programs is now getting started. Tozer and Isakson focused their testimony on different issues, not mentioning RHS at all.

A number of committee and subcommittee members came in for at least part of the hearing. Subcommittee chair Judy Biggert (R-IL) asked Trevino about RHS’s institutional knowledge. Rep. Ruben Hinojosa (D-TX) thanked Trevino for her work to improve rural housing, but did not ask her any questions. The rest of the members asked questions of the other witnesses on other topics, such as how big FHA’s role in the mortgage market should be, whether Fannie Mae and Freddie Mac should be phased out, and how to help struggling homeowners.

Posted: September 9, 2011
Last updated: September 13, 2011

Compensation for Claims of Discrimination

August 15, 2011/in Announcements

Please note the following announcement from the US Department of Agriculture.

ATTENTION HISPANIC AND WOMEN FARMERS AND RANCHERS

Compensation for Claims of Discrimination

If you believe that the U.S. Department of Agriculture (USDA) improperly denied farm loan benefits to you between 1981 and 2000 because you are Hispanic or because you are female you may be eligible if:

You sought a farm loan or farm-loan servicing during that period;
The loan was denied, provided late, approved for a lesser amount than requested, approved with restrictive conditions, or USDA failed to provide an appropriate loan service; and
You believe these actions were based on your being Hispanic or your being female. In 2011, a claims administrator will begin mailing claims packages to those who have requested one through the Call Center on the website. The claims package will have detailed information about the eligibility and claims process.

If you want to register your name to receive a claims package access the Hispanic and Women Farmer and Rancher Call Center or website.

Call Center: 1-888-508-4429

Website: www.farmerclaims.gov

For guidance, you may contact a lawyer or other legal services provider in your community. USDA cannot provide legal advice to you

If you are currently represented by counsel regarding allegations of discrimination or in a lawsuit claiming discrimination, you should contact your counsel regarding this claims process