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Friday, February 12, 2016

President's Proposed Budget Would Be a Major Step Forward in Addressing Homelessness

The White House released its proposed HUD budget this past week. I recommend you take a look at the National Housing Conference Blog, which does a nice job of summarizing it. This budget is more aggressive in dealing with homelessness than any of this President's previous budgets. I want to highlight a few elements of his proposal that are significant changes in affordable housing policy:

  • Allocates almost $11 billion to house homeless families over the next 10 years. In California, if this is combined with a $2 billion multi-year initiative proposed in this year's legislative session, real progress could be achieved in eliminating homelessness.
  • 10,000 new housing vouchers for homeless families
  • 25,500 new units of permanent supportive housing for chronically homeless individuals
  • Statutory changes to the HOME Program that include eliminating the 24-month commitment requirement, and eliminating the required 15% set-aside for Community Housing Development Organizations (CHDOs). In my view, these changes would allow greater flexibility and more effective use of the HOME Program by Participating Jurisdictions. These requirements often force communities to fund projects that are less feasible or not as ready to start construction as others. As a result, expending HOME funds within the mandated deadlines has been a challenge for many communities, especially those with few soft funding options.

Of course, there is the real possibility that this budget proposal is gutted by the time it gets through Congress. However, there is a glimmer of hope that there is enough bipartisan support for addressing homelessness and using HOME funds more efficiently that those portions of the budget could survive intact.

Monday, February 8, 2016

Accessing Cap and Trade Funds for Housing

California was the first state in the nation to establish a cap and trade program in which polluting industries pay into a state-controlled fund in exchange for the right to exceed greenhouse gas emissions standards. A portion of the money generated from payments into this fund has been aside for smart growth transportation and development, including affordable housing. The program incentivizes development that is integrated into transportation infrastructure that shifts transportation trips from cars to public transit, biking and walking, and can demonstrate a reduction in projected greenhouse gas emissions. The program has been generating more revenue than initially forecast, as the funding allocation has grown from $120 million in 2015 to $320 million in 2016. Find more background here.

The Affordable Housing and Sustainable Communities Program (AHSC) is jointly managed by the California Strategic Growth Council (SGC), and Housing and Community Development Department (HCD). Below I highlight some key aspects of this program.

  • AHSC encourages joint applications between housing developers and public entities that build transportation infrastructure (transit authorities, counties, cities, etc.). Housing and connections to transit, pedestrian and bike improvements should be planned holistically, with the intent to facilitate use of these alternative forms of transportation by residents.
  • Projects to be funded with AHSC must have completed their CEQA and NEPA environmental review processes prior to application submission in order to qualify.
  • Match funding is a key scoring criteria.
  • Funding committed to housing development is made in the form of a permanent, residual receipts payment loan, with terms and loan limits similar to HCD's Multifamily Housing Program.
  • Housing projects can also apply for Housing Supported Infrastructure for off-site improvements. This funding is made in the form of a grant.
  • Housing projects must provide at least one secure off-street bike storage space for every two units. 
  • In future funding rounds, AHSC will not subsidize off-street parking costs. These costs will need to be funded by other sources.
As you can see,  putting together an application for this funding requires advance planning, even though the formal NOFA and guidelines have been released just a couple months before the application due date each of the last two years. There are two application phases, with the first due in March of each year. Therefore, Applicants should start planning to submit an application in September or earlier of the prior year.

More information about this year's NOFA can be found at the AHSC website. Feel free to contact me if you need assistance with this program.