Federal shutdown continues, impact on rural renters still unclear

As of January 8, 2019, parts of the federal government including USDA and HUD remain shut down. HAC has not been able to learn any additional information about the impact on USDA Section 521 Rental Assistance and Section 542 vouchers since our December post.

The National Rural Housing Coalition has compiled information about the shutdown’s early impacts on rural housing organizations around the country.

– Posted by Leslie Strauss

US Capital building

How Will a Federal Government Shutdown Impact Rural Housing?

It seems likely that parts of the federal government will close at midnight on Friday, December 21, 2018. Some departments and agencies have been approved for funding through September 30, 2019, but others have not. The offices at risk of closing down include the Departments of Agriculture, Housing and Urban Development, Commerce, Homeland Security, Interior, Justice, Transportation, Treasury and State, as well as the Environmental Protection Agency, Food and Drug Administration and Internal Revenue Service.

Official contingency plans for use if funding lapses are available online from USDA, HUD, and other agencies. Generally, federal staff in the affected agencies will not work and will not be paid unless their functions are considered “essential.” Employees are also not allowed to do their jobs voluntarily while they are furloughed. In the past, Congress and the President have usually agreed to pay furloughed employees retroactively after a shutdown ends, but they are not required to do so.

USDA Rural Development

The plan for USDA Rural Development explains that RD offices at the state level and below will be shut down completely if funding ends. Some functions located at the national office in Washington, D.C. and the servicing center in St. Louis will continue “for the purpose of preserving the Government’s property.” Government property is deemed to include RD’s loan portfolio, so some payments to and from RD financial systems will be processed. Loan escrow accounts will be serviced as well.

RD borrowers will not be able to make loan payments, however. Closings for direct loans will not take place. Applications will not be processed, and “no new RD rural housing loans or guarantees would be issued.” Borrowers already approved for Section 502 loan guarantees have the option to close their loans with their private lenders – at their own risk, because guarantees will not be issued until after the shutdown ends.

“System generated disbursements for previously obligated Rental Assistance funds will continue.” The contingency plan does not mention disbursements for Section 542 vouchers.

The contingency plan also notes that “if a shutdown occurred in December, RD borrowers would not receive critical information to file income tax returns.” The plan does not indicate how long it might take after a shutdown ends to send the needed tax information.

U.S. Department of Housing and Urban Development

HUD has posted an FAQ to accompany its contingency plan. Summaries are also available from several organizations:

· Affordable Housing Online

· Enterprise Community Partners

· LeadingAge

· National Association of Realtors

Materials Posted: Proposed Changes to CRA – What Does It Mean for Rural America?

Materials Posted

PowerPoint Presentation | Webinar Recording | HAC Reports on CRA in Rural America

The Office of the Comptroller of the Currency (OCC) recently issued a call for input on its regulations implementing the Community Reinvestment Act, which requires banks to help meet the credit needs of the communities they serve. OCC’s notice says it is building a new framework to transform and modernize its CRA rules.

Please Join the Housing Assistance Council (HAC) for an overview of the proposed changes and a discussion on how rural communities can weigh in on the proposal.

Materials Posted – Part 1 – Housing and Urban Development-Veterans Affairs Supportive Housing (HUD-VASH): An Overview

Materials Posted

PowerPoint Presentation | Webinar Recording

Permanent supportive housing has been identified in both the Federal Strategic Plan to Prevent and End Homelessness and the Ending Veteran Homelessness Initiative as a critical resource for ending homelessness. Within VA, HUD-VASH is the primary service that provides permanent supportive housing. Through collaboration with HUD, HUD-VASH provides Housing Choice Vouchers designated to participating Public Housing Authorities (PHA) to assist with rent payment. VA provides clinical case management and services to assist Veterans obtain and sustain permanent housing while also assisting Veterans with access to treatment and other supportive services that promote their quality of life and full reintegration back into their communities.

HUD-VASH operates on the Housing First principles and is intended to target and care for the chronic and most vulnerable homeless Veterans. Housing First is an evidence-based approach based on the premise that housing is a basic human right and does not have prerequisites such as sobriety or clean time. It prioritizes housing, then assists individuals with access to health care and other supports that promote stable housing and improved quality of life.

The primary goal of HUD-VASH is to move Veterans and their families out of homelessness into permanent supportive housing while promoting maximum Veteran recovery and independence in the community. A key component of the program is VA’s case management services. These services are designed to assist Veterans in obtaining and sustaining permanent housing and engage in needed treatment and other supportive services that improve the Veteran’s quality of life and end their homelessness. Because Veterans experience homelessness for a variety of reasons, case management is individually tailored to meet the needs of each HUD-VASH Veteran.

This webinar, the first in a two part series that will provide information to community providers on housing services available to Veterans who are homeless or at risk of becoming homeless. The webinar will provide an overview of the HUD-VASH program including who is eligible for services and how to make a referral for a Veteran to be assessed for admission. There will also be information on how HUD-VASH vouchers are allocated and the difference between tenant-based and project-based HUD-VASH vouchers.

There's Still Time to Nominate Someone for a Rural Housing Award

HAC is still accepting nominations for its 2018 Cochran/Collings National Service and Skip Jason Community Service Leadership Awards. Nominations are now due Friday, September 14, 2018. The awards will be presented at the 2018 Rural Housing Conference in December. Complete the online nomination form.

Questions? Contact HAC’s Lilla Sutton at (202) 842-8600 or lilla@ruralhome.org.

Income Inequality in Rural America

HAC Executive Director Moises Loza submitted the following Letter to the Editor to the Washington Post on June 27, 2016.

“The rural reaches of income inequality” (June 26) raises issues that are too often ignored. As the Housing Assistance Council works to improve housing conditions for low-income rural Americans, we are well aware of the consequences of income inequality. In places with significant income differences, the wealthy depend on service workers but those who wait tables, work in retail, clean homes, and maintain lawns cannot afford decent homes near their jobs.

There are other costs as well. For example, USDA’s Economic Research Service has identified the growth in income inequality as the major factor increasing rural child poverty from 2003 to 2014. The Robert Wood Johnson Foundation and the University of Wisconsin Population Health Institute report that counties with high levels of child poverty and income inequality are often less healthy than those with lower levels. (Their study defined income inequality as the difference between the 20th and 80th percentiles rather than between the top 1 and bottom 99.)

Even without income inequality, of course, poverty can be dangerous. The Post’s interactive online map shows that in Oglala Lakota County, SD (formerly named Shannon County), the top 1 percent makes only 5.3 times as much as the bottom 99 percent. Income inequality is hardly a problem there, but deep, persistent poverty is. Oglala Lakota County, which lies entirely within the Pine Ridge Indian Reservation, has had a poverty rate well over 50 percent for decades. As a result, 51 percent of homes in the county are physically deficient and 26 percent are overcrowded.

Serious housing problems exist in other persistent poverty counties, as well. These areas, which tend to have low proportions of the extreme income inequality highlighted in the Post’s article, are concentrated in certain parts of the country: Native American lands, Appalachia, the Lower Mississippi Delta and the Southern Black Belt, and the colonias along the U.S.-Mexico border. Income and housing issues are common among farmworkers, as well, although those are not as visible on a map. Notably, minorities are the majority in five of these six regions and populations (Appalachia being the exception).

Thanks are due to the Post for its reporting and to the Economic Policy Institute for including rural places in its income inequality research. As income inequality, job opportunities, and race drive the politics of the day, we cannot continue to overlook their presence anywhere in the country.

Moises Loza
Executive Director
Housing Assistance Council

State of the Nation's Housing 2016

The State of the Nation’s Housing 2016

Rural communities face unique challenges with substandard housing, aging populations, and decreasing federal investment.

son 2016-cover-l

The Joint Center for Housing Studies at Harvard University released the annual State of the Nation’s Housing Report for 2016. The report includes an interactive mapping untility and details the dynamics of housing markets across the country, including an analysis of demographic drivers, rental and owner-occupied housing, and housing challenges for communities across the U.S.

According to the report, the Housing Market has largely recovered from the market collapse of 2008, as new construction rates have increased and the rental housing market continues to expand. However, the report examines how the strengthening market has led to affordability challenges that outstrip the availability of federal housing assistance. The affordability gap has in turn led to a concentration of poverty in the most high need regions and communities.

The report also details ongoing challenges facing non-metro and tribal areas, where poverty rates are higher than the national rate. Substandard housing is particular problem in these areas, where housing in a non-metro area is twice as likely to have incomplete plumbing, and five times as likely in tribal areas. The population in rural areas is also older, and only one-third of the houses can be classified as accessible. Meanwhile, federal housing assistance targeted at rural and tribal areas is limited and has seen a decrease in funding.