The Housing Assistance Council is an independent, non-partisan and regularly responds to Congressional committees, Member offices, federal agencies, and policy advocacy coalitions with the research and information needed to make informed policy decisions. Our research work, Rural Data Portal, and Veterans Data Central all provide valuable, educational context to frame the rural policy conversation. If you want to know how a new program or policy could impact America’s small towns and rural places, please don’t hesitate to contact us at policy@ruralhome.org.

HAC Submits Comments on HUD Fair Housing Regulations

On August 20, 2018 HAC submitted a response to HUD’s request for comments on the “disparate impact” standard used in its fair housing regulations. HAC’s letter (PDF) strongly supports the regulation in its current form. HUD received a total of almost 2000 comments.

USDA Implements Farmworker Housing Occupancy for H-2A Visa Holders

On July 10, 2018, USDA’s Rural Housing Service released guidance on new expanded eligibility for USDA-assisted farmworker housing. The change, adopted by Congress in this year’s USDA funding bill for USDA, makes workers admitted to the U.S. on H-2A visas eligible to live in housing financed by USDA’s Section 514/516 Farm Labor Housing program.

H-2A workers were not previously eligible for these rental apartments and houses. Their employers – who must obtain federal approval to bring them to the U.S. to do farmwork for up to a year – are responsible for providing housing for them. USDA’s press release announcing the change quotes Secretary of Agriculture Sonny Perdue: “I am pleased that USDA programs can now better assist farmers needing to provide housing” for their H-2A workers while they are in the U.S.

The law that expanded the program also slightly increased its funding over last year’s levels, but it is not yet clear whether there will be additional demand for these units immediately, or whether the additional funds will be enough to meet any increase in demand. This year’s application period is currently underway (preapplications are due August 27).

The new USDA guidance states that “under no circumstance may any [current tenants in USDA-financed farmworker housing] be displaced from their homes as a result of this statutory change.”

There are no provisions in the law or the guidance explaining how landlords should prioritize new applicants with H-2A visas and those who are eligible but have some other form of work permission such as a “green card” or U.S. citizenship.

Meanwhile, the H-2A program itself may be changing. In May a press release from the Departments of State, Agriculture, Labor, and Homeland Security announced they are developing new rules for the program: “The Trump Administration is committed to modernizing the H-2A visa program rules in a way that is responsive to stakeholder concerns and that deepens our confidence in the program as a source of legal and verified labor for agriculture – while also reinforcing the program’s strong employment and wage protections for the American workforce. In addition, by improving the H-2A visa program and substantially reducing its complexity, the Administration also plans to incentivize farmers’ use of the E-Verify program to ensure their workforce is authorized to work in the United States.”

In early July the Department of Homeland Security announced that exemptions for some Caribbean farmworkers are being cancelled. Those workers did not previously need H-2A visas to come to the U.S. for jobs but, as of August 6, 2018, they will.

USDA also recently started a pilot program “to evaluate the logistical feasibility of having mixed occupancy” in a Section 514/516 property that also receives funding assistance from another program. In other words, USDA is testing whether landlords could still comply with program rules if they have some tenants who are farmworkers and some who are not.

Administration Proposes Moving Some Rural Housing Programs to HUD

The rural loan guarantees and rental assistance programs of the U.S. Department of Agriculture (USDA) would move to the Department of Housing and Urban Development (HUD) under a proposal released by the Trump Administration on June 21, 2018. The Administration’s document acknowledges that USDA’s Section 502 guarantee program for homebuyers, its Section 538 guarantee program for developers of rental housing, its Section 521 Rental Assistance program, and its Section 542 tenant voucher program are not the same as HUD’s Federal Housing Administration mortgage guarantee programs or HUD’s renter aid programs. It contends, however, that rural America no longer needs separate housing resources.

The Administration proposal suggests modeling this reorganization of agencies after a bill drafted in 2011 but never introduced, the FHA-Rural Regulatory Improvement Act of 2011. That bill would have transferred the entire USDA Rural Housing Service (RHS) to HUD. It is unclear how that would have been feasible, since RHS field staff are also responsible for USDA’s community facilities programs and overlap with staff for other USDA rural development programs. HUD would have been responsible for determining how to effectuate the transfer.

The Administration’s suggestion seems to be based on reports from the Government Accountability Office in 2000, 2012, and 2016, although GAO’s analyses stop short of recommending the change. GAO has repeatedly noted the challenges involved in combining programs and has recommended “that RHS and FHA should evaluate and report on opportunities to consolidate their similar housing programs.” Such an evaluation has never been prepared.

The other housing-related section of the Administration’s government reorganization document proposes to end the conservatorship of Fannie Mae and Freddie Mac and transition the two government-sponsored enterprises to fully private entities. An unspecified federal government entity would continue to regulate them. Fannie, Freddie, and any other competitors that entered the secondary mortgage market would pay a fee that would be transferred to HUD to finance affordable housing.

USDA Multi-Family Housing Annual Occupancy Report Released

USDA released the 2017 Rural Development Multi-Family Housing (MFH) Annual Occupancy Report. The report includes both Rural Rental Housing (RRH) Section 515 and Farm Labor Housing (FLH) Section 514 properties. These results are based on September 2017 data from the Multi-Family Information System database.

This report presents data from the past three years, comparing information from years 2015 to 2017.

Joel Baxley named RHS Administrator

On April 19, 2018, USDA announced the appointment of Joel Baxley as Rural Housing Service Administrator.

The announcement says “Joel Baxley comes to USDA with 23 years of real estate finance experience, including 13 years providing valuations of complex property types. He most recently served as the Consulting Services Director and the senior real estate technical consultant with RSM US LLP’s Financial Advisory Services consulting practice. Joel holds an undergraduate degree and MBA from the University of Alabama and a post-graduate degree from the University of Oxford.”

Baxley was one of the authors of the 2016 Comprehensive Property Assessment of USDA’s multifamily housing portfolio.

HAC Testifies on FY19 Rural Housing Funding

On April 13, 2018 HAC submitted written testimony to the House Appropriations Subcommittee on Agriculture making recommendations about fiscal year 2019 appropriations for USDA’s rural housing programs.

HAC Submits Comments on USDA Civil Rights Changes

On March 24, 2018 HAC submitted comments to USDA on proposed changes to its civil rights functions. HAC’s comments encourage USDA to stay focused on protecting the civil rights of its customers and staff, and providing information about how the proposed changes were identified as necessary.

HAC’s comments are available here (PDF).

FY18 Spending Agreement Increases Funds for Some Housing Programs

Congressional negotiatiors agreed March 21, 2018 on an omnibus appropriations package for FY18, the fiscal year that began October 1, 2017. The bill is expected to pass both the House and Senate, and to be signed into law by President Trump, before midnight on March 23. The bill maintains or increases funding levels for both USDA and HUD housing programs. In fact, because the cap on FY18 spending levels was raised, funding levels for several programs were increased above the amounts in both the House and Senate FY18 bills. These include Section 502 direct homeownership loans, Section 515 direct rental loans, Section 542 vouchers, and others at USDA. At HUD, there are increases for HOME, CDBG, Section 202, Section 811, the Public Housing Capital Fund, tenant-based and project-based vouchers, and others.

The final bill does not include the Rural Economic Infrastructure Grants proposed in the Administration’s FY18 budget.

Congress has recently taken the first steps towards FY19 funding decisions, beginning to hold hearings on the Administration’s budget requests. HAC will continue to report on this process as it moves forward.

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USDA Rural Dev. Prog.
(dollars in millions)

FY16 Approp.

FY17 Approp.

FY18 House Bill (H.R. 3268)

FY18 Senate Bill (S. 1603)

FY18 Final Approp.

502 Single Fam. Direct
Self-Help setaside

$900
5

$1,000
5

$900
5

$1,000
5

$1,100
5

502 Single Family Guar.

24,000

24,000

24,000

24,000

24,000

504 VLI Repair Loans

26.3

26.3

24

26.3

28

504 VLI Repair Grants

28.7

28.7

a

28.7

30

515 Rental Hsg. Direct Lns.

28.4

35

28.4

35

40

514 Farm Labor Hsg. Lns.

23.9

23.9

15

23.8

23

516 Farm Labor Hsg. Grts.

8.3

8.3

6

8.3

8.4

521 Rental Assistance

1,390

1,405

1,345

1,345

1,345

523 Self-Help TA

27.5

30

25

30

30

533 Hsg. Prsrv. Grants

3.5

5

a

5

10

538 Rental Hsg. Guar.

150

230

230

230

230

Rental Prsrv. Demo. (MPR)

22

22

15

22

22

542 Rural Hsg. Vouchers

15

19.4

20

19.4

25

Rural Cmnty. Dev’t Init.

4

4

0

4

4

a. Section 504 grants and Section 533 grants would have been rolled into a new Rural Economic Infrastructure Grant program. This change is not included in the final bill.

HUD Program
(dollars in millions)

FY16 Approp.

FY17 Approp.

FY18 House Bill (H.R. 3353)

FY18 Senate Bill (S. 1655)

FY18 Final Approp.

CDBG

$3,000

$3,000

$2,900

3,000

3,300

HOME

950

950

850

950

1,362

Self-Help Homeownshp. (SHOP)

10

10

10

10

10

Veterans Home Rehab

5.7

4

0

4

4

Tenant-Based RA
VASH setaside
Tribal VASH

19,628
60
0

20,292
40
7

20,487
577b
7

21,365
40
5

22,015
40
5

Project-Based Rental Asstnce.

10,622

10,816

11,082

11,507

11,515

Public Hsg. Capital Fund

1,900

1,942

1,850

1,945

2,750

Public Hsg. Operating Fund

4,500

4,400

4,400

4,500

4,550

Choice Neighbrhd. Initiative

125

137.5

20

50

150

Native Amer. Hsg. Block Grant

650

654

654

655

655

Homeless Assistance Grants

2,250

2,383

2,383

2,456

2,513

Hsg. Opps. for Persons w/ AIDS

335

356

356

330

375

202 Hsg. for Elderly

432.7

502.4

573

573

678

811 Hsg. for Disabled

150.6

146.2

147

147

230

Fair Housing

65.3

65.3

65.3

65.3

65

Healthy Homes & Lead Haz. Cntl.

110

145

130

160

230

Housing Counseling

47

55

50

47

55

FY19 Budget Proposes to Eliminate Most Rural Housing Programs

Guarantees for bank loans would remain at current levels and basic rent aid for tenants would continue, but other rural housing assistance would be wiped out under the Trump Administration’s budget proposal for fiscal year 2019 released on February 12, 2018. Although tenants would continue receiving assistance, they would face a new requirement to pay at least $50 per month in rent unless they are deemed to experience economic hardship.

This budget is much the same as last year’s proposal for rural housing. Last year the Section 504 grant program – which offers small grants to elderly homeowners with very low incomes to repair health and safety hazards in their homes – would have been rolled into a new pool of money called the Rural Economic Infrastructure Grant program. This year’s budget does not include that infrastructure grant proposal, and would simply eliminate Section 504 grants. The House incorporated the infrastructure grant idea into its FY18 appropriations bill, but both the House and the Senate rejected most of the program eliminations proposed by the Administration last year.

The guarantee programs that would remain – Section 502 guarantees for homebuyers and Section 538 guarantees for builders of rental housing in rural places – cover their own costs through fees, so the government pays only the costs of administering them.

USDA’s Section 521 Rental Assistance and Section 542 voucher programs, which assist tenants in two different sets of circumstances, would be funded at levels similar to current amounts. The $20 million proposed for vouchers, however, is too low to help all eligible tenants who want vouchers. HAC believes at least $27 million will be needed for these renters whose landlords pay off their USDA mortgages, either early or at maturity.

In addition to the new $50 rent requirement, the budget proposes to allow USDA to recapture Rental Assistance funds from past years’ agreements if the department determines a property no longer needs RA, and to use those funds for other properties. It would also let USDA transfer unneeded RA or voucher funds to any other rural housing programs. [tdborder][/tdborder]

USDA Rural Dev. Prog.
(dollars in millions)

FY16 Approp.

FY17 Approp.

FY18 House Bill (H.R. 3268)a

FY18 Senate Bill (S. 1603)a

FY19 Admin Budget Proposal

502 Single Fam. Direct
Self-Help setaside

$900
5

$1,000
5

$900
5

$1,000
5

0
0

502 Single Family Guar.

24,000

24,000

24,000

24,000

24,000

504 VLI Repair Loans

26.3

26.3

24

26.3

0

504 VLI Repair Grants

28.7

28.7

c

28.7

0

515 Rental Hsg. Direct Lns.

28.4

35

28.4

35

0

514 Farm Labor Hsg. Lns.

23.9

23.9

15

23.8

0

516 Farm Labor Hsg. Grts.

8.3

8.3

6

8.3

0

521 Rental Assistance

1,390

1,405b

1,345

1,345

1,331.4b

523 Self-Help TA

27.5

30

25

30

0

533 Hsg. Prsrv. Grants

3.5

5

a

5

0

538 Rental Hsg. Guar.

150

230

230

230

250

Rental Prsrv. Demo. (MPR)

22

22

15

22

0

542 Rural Hsg. Vouchers

15

19.4

20

19.4

20

Rural Cmnty. Dev’t Init.

4

4

0

4

0

a. FY18 appropriation is not yet final.
b. Includes $40 million in advance funding for FY18, so total available in FY17 was $1.365 billion and total available in FY18 would be $1.385 billion. The FY19 budget assumes that this “forward funding” continues, so more than $1.331 billion would be available in FY19.
c. Section 504 loans and other non-housing loans would have been rolled into a new Rural Economic Infrastructure Grant program.

Broadband to house - USDA

Gonzalez Named RD Chief of Staff

Gil Gonzalez, who served in USDA Rural Development from 2001 to 2005, has been named Chief of Staff for RD. Anne Hazlett, who heads the agency, announced his appointment on January 18, 2018.