Senior housing's $174 million question
After eight years, money has been allocated to the federal Housing Trust Fund, the U.S. Department of Housing and Urban Development announced Wednesday. Whether this availability of funds will result in more affordable seniors housing is the $174 million question, but at least one provider group is hoping the answer is yes.
“States have to use the funds to meet their priority housing needs, and there's a case to be made in every state that the severe lack of housing affordable to low-income seniors is a priority housing need,” LeadingAge Director Housing Policy and Priorities Linda Couch told McKnight's Senior Living.
The affordable housing program was authorized by the Housing and Economic Recovery Act of 2008 but hadn't been capitalized until now. “It's funding sources, Fannie Mae and Freddie Mac, were in the process of rebuilding after the [financial] crisis,” HUD Secretary Julian Castro said.
LeadingAge has been “eagerly anticipating” the release of the funds, Couch said. HUD had issued interim rules on implementation to states in January 2015. And in some ways, the wait has been longer than eight years. The Trust Fund, Couch noted, is the first new money made available for housing for extremely low income households in more than 40 years, since the Section 8 program was authorized in 1974.
The new $174-million fund is meant to complement existing federal, state and local efforts to increase and preserve affordable housing for households defined as having extremely low or very low income. By law, each state is allocated $3 million from the fund. Thirty-six states have been apportioned that minimum amount in fiscal year 2016, with only two states having more than $4.8 million set aside for them: California, which has been allocated $10.1 million, and New York, for which $7 million has been earmarked.
It's up to the states to decide how they want to use the funds, within limits.
“These dollars can be used for production, they can be used to preserve affordable housing, and some of the money can be used for rental assistance for units that are funded with Trust Fund dollars,” Couch said. “So it's pretty flexible money. What's not flexible about it is the income targeting, which is terrific, because the money is really targeted to where it's needed the most.”
State affordable housing planners are developing their plans for the funds now. “Our partners at the state level are working to see that the needs of seniors are highlighted in those plans,” Couch said.
LeadingAge estimates that states will have their plans to HUD by early summer and could have their funds by late summer or early fall once the federal agency determines whether the plans meet government specifications. Then states can hold competitions to award grants or loans to applicants that meet the priority needs that they have defined.
“We hope that the actual dollars will get to the grantees this year, and we want to see these dollars used as quickly, efficiently and smartly as possible so we can advocate for more and more money into the Trust Fund,” Couch said.
“Developers are hungry to get their hands on resources that are really going to make a difference like this, so the Trust Fund holds tremendous value,” she said.
HUD has posted a fact sheet about the Housing Trust Fund online. Watch HUD's 14-minute overview of the program here: