Support and Strengthen Federal Housing Programs

What Can Policymakers Do?  

• Provide subsidized housing options
  • Section 8: State policymakers can support local housing authorities’ enhancement of Section 8 funding, HUD’s direct grants to assist very low-income individuals for obtaining decent, safe and sanitary rental housing.  Some states, like Washington and Massachusetts, have used Section 8 vouchers to fund the creation of permanent supportive housing for low- and moderate-income families with special needs, such as disabled or homeless families
  • Section 8 Homeownership Program: Helps first-time low-income homebuyers with Section 8 vouchers meet their monthly mortgage and other homeownership expenses.  New Jersey strengthened its Section 8 Homeownership Program with an initiative funded through the federal Assets for Independence (AFI) program, beginning in 2009.  Over 12 to 24 months, individuals enrolled save toward either a single-family home with a 1-4 matching grant of up to $7500 or a multi-family home with a 1-6 matching grant of up to $11,250, and there is no lien placed on the home.  Clients must attend homebuyer education classes and be mortgage-ready upon completion of their savings plan; purchasers of multi-family homes must complete landlord training.
  • Public Housing: With approximately 1.2 million households living in public housing units, state policymakers should strengthen oversight of public housing programs to ensure  these households have safe and decent housing.  Created by statute in 1994, the Texas State Affordable Housing Corporation is a self-sustaining non-profit organization created to develop and administer affordable housing for low-income Texans statewide.  TSAHC’s Asset Oversight and Compliance Department oversees compliance on over 6500 units throughout the state, and TSHAC itself is subject to significant state oversight.

• Support housing maintenance and improvement programs.
  • HUD’s HOME Program: State policymakers can help ensure the development, maintenance and improvement of affordable housing for low-income families by maximizing programs to build, buy or rehab properties.  Minnesota’s HOME Consortium, a coalition of three counties that distributes HOME funds to participating jurisdictions, offers a Homeowner Rehabilitation Deferred Loan, a no-interest deferred loan of up to $20,000 for households earning below 80 percent of area median income. These funds can be used for priority home improvements critical to the safety of the home, such as roof or window replacements and plumbing repairs. There are no monthly payments, and the loan is repayable upon sale or transfer of the property.
  • Community Development Block Grants (CDBG): CDBG Entitlement Grants can be used for improving physical infrastructure, supporting community economic development and conserving energy in urban areas (Entitlement Grants).  In 2009, Maryland allocated CDBG funds to counties for housing-related projects including the rehabilitation of vacant housing for use as low-income housing and the provision of 0% interest deferred payment loans as second mortgages for Section 8 clients.

• Provide affordable rural housing options. It is important to recognize the unique affordable housing needs of rural communities and help low-income families in rural areas access federal and state affordable housing assistance.  The Rural Rental Housing Loan (Section 515) Program provides direct loans to developers to build or rehabilitate affordable multi-family rental housing for very low-, low- and moderate-income families and elderly and disabled individuals. Section 515 funds can also be used to buy and improve land and develop infrastructure, such as water and waste disposal.  The Rural Housing Direct Loan (Section 502) Program makes loans to low- and very low-income rural families to build or acquire a home.  Because it can be used to fund improvement of physical infrastructure, community economic development and energy conservation, the Community Development Block Grant (CDBG) States’ Program is also a tool for expanding affordable housing in rural areas. To simplify rural communities’ access to affordable housing, Michigan’s HOME Team Advantage combines USDA Rural Development loans and multiple state loans into a single package.