The Housing & Economic Recovery Act of 2008 (HERA) established a Housing Trust Fund (HTF) to be administered by HUD. The purpose of the HTF is to provide grants to State governments to increase and preserve the supply of rental housing for extremely low- and very low-income families, including homeless families, and to increase homeownership for extremely low- and very low-income families. This interim rule, published on January 30, 2015, establishes the regulations that will govern the HTF. Once funding is available and grantees have gained experience administering the program, HUD will open the rule for public comment.
Under the HTF, annual formula grants will be made to states and state-designated entities. At least 80% of the grants must be used for rental housing; up to ten percent for homeownership; and up to ten percent for administrative costs. HTF funds may be used for the production or preservation of affordable housing through the acquisition, new construction, reconstruction, and/or rehabilitation of non-luxury housing with suitable amenities.
There is a good deal of opposition to the program in Congress, especially among Republicans, who now control both the House and Senate. For this reason, there is no guarantee that the program will ultimately be funded. If it is funded, State agencies administering the program will have to develop policies and systems. Clearly, no funds will be available for development purposes under the HTF in the short-term. When – and if- funding does become available, I will prepare a comprehensive description of the program regulations for clients. In the meantime, those interested in reviewing the Interim rule can find it in the January 30 Federal Register.