Appropriators Work to Negotiate Spending Agreement Before December 20 Deadline

Congressional appropriators held meetings earlier this month, as they continue to work towards a comprehensive FY2020 spending agreement. Lawmakers are hopeful that the Senate and House will be able to negotiate all 12 appropriations bills before December 20 when government funding runs out. Chair of the appropriations subcommittee on Transportation and Housing and Urban Development (THUD), Representative David Price (D-NC-4), reported on the status of his bill, stating, "Our bill is looking good. We’re concerned about policy provisions, we haven’t been able to resolve all of those, but that’s always the way it is."

One of the policy concerns that has not been resolved is language contained in both the Senate and House FY2020 THUD bills that would ensure HUD rolls back 2019 criteria to that of 2018 for the Continuum of Care (CoC) program. The 2019 criteria has been criticized for imposing excessive service participation requirements. It also dropped prior incentives to adopt nondiscrimination policies on the basis of sexual orientation and gender identity.

Many advocates support Housing First and believes it should be a core component of CoC NOFAs. Advocates also encourages Congress and the Administration to finalize FY2020 spending bills quickly and provide strong levels of funding for affordable housing and community development programs.

Campaign’s Statement on the Introduction of the Eviction Crisis Act

Campaign’s Statement on the Introduction of the Eviction Crisis Act
Washington, DC – Earlier this month, Senators Michael Bennet (D-CO) and Rob Portman (R-OH) introduced the Eviction Crisis Act, which creates new tools to help end the nation’s continuing eviction epidemic. Among various other promising provisions, the legislation includes the creation of an Emergency Assistance Fund to test, evaluate, and expand proven interventions to help low-income households facing housing instability due to an unexpected economic shock. This policy solution was developed and championed by the Opportunity Starts at Home campaign, which worked closely with the bill’s sponsors. The introduction of this legislation marks a significant milestone for the campaign in advancing its policy agenda.
The Emergency Assistance Fund is structured as a competitive grant program administered by the Department of Housing and Urban Development (HUD), with input from the Departments of Health and Human Services (HHS) and Agriculture (USDA). Grants would be awarded to states and local governments to establish crisis assistance programs to prevent extremely low-income households from experiencing housing instability, including an imminent risk of eviction or homelessness, by providing short-term financial assistance and housing stabilization services. At least three-fourths of the dollars must be used to provide direct financial assistance and up to one-fourth can be used to provide wrap-around services, such as counseling. The bill also requires a rigorous evaluation of the program’s effectiveness in preventing housing instability.
Most families in poverty who rent spend at least half of their incomes on housing, leaving virtually no margin for an unexpected expense. Broken-down cars, unreimbursed medical bills, or temporary declines of income can quickly send vulnerable households down the spiral of housing instability, eviction, and even homelessness. If enacted, the Emergency Assistance Fund could provide a blueprint for helping millions of low-income households that live on the edge of what they can afford.
Leading national organizations from the housing, education, health, civil rights, anti-hunger, anti-poverty, criminal justice, child welfare, and faith-based sectors have come together through the Opportunity Starts at Home campaign to advocate for more robust and equitable federal housing policies. Earlier this year, the campaign released its national policy agenda, "Within Reach," which calls for a significant increase in rental assistance, a major expansion of the supply of deeply affordable housing, and emergency financial assistance to keep people in crisis stably housed.

Montgomery Nomination Confirmed by Senate Committee

The Senate Committee on Banking, Housing, and Urban Affairs confirmed Brian Montgomery’s nomination to become Deputy Secretary of HUD earlier this month. The committee approved Montgomery, who is HUD Assistant Secretary for Housing and FHA Commissioner and currently also serving as Acting Deputy Secretary, by a voice vote of 20–5.

Ranking Member Sherrod Brown (D-OH), Jack Reed (D-RI), Elizabeth Warren (D-MA), Catherine Cortez Masto (D-NV), and Tina Smith (D-MN) opposed Montgomery’s nomination. Brown voiced his concern about Montgomery’s leadership during his current tenure at HUD, specifically citing Montgomery’s lack of public opposition to the Administration’s proposed funding cuts for the vital affordable housing programs CDBG and HOME. The seven other Democrats on the committee joined the Republican members in voting to confirm Montgomery.

The committee also confirmed David Woll to be HUD Assistant Secretary of the Office of Community Planning and Development and John Bobbitt to be HUD Assistant Secretary for Administration, both by voice vote.

Numbers of the Day and More from OK Policy Institute

From our Friends at OK Policy:

Weekly What’s That

Revenue estimate, what’s that?

Oklahoma makes official revenue estimates that determine how much the Legislature is allowed to appropriate in its annual budget for state agencies. The Legislature is limited to appropriating no more than 95 percent of certified collections. Revenue estimates are certified three times each year. Learn more about revenue estimates.

Look up more key terms to understand Oklahoma politics and government here.

Quote of the Week

“Poverty can affect our students before they even walk in the door. But poverty is not an indicator of ability. It just means that you may need different supports. … Poverty affects people in a multitude of ways, but it is not an indicator of who you can be and who you can grow into. But it is a factor.”

-Alicia Priest, president of the Oklahoma Education Association speaking about new Census data about poverty in the state [The
Oklahoman
]

Numbers of the Day

· 12 – The number of states including Oklahoma where at least half of all public schools are rural. The other states are Montana, South Dakota, Vermont, North Dakota, Maine, Alaska, Nebraska, Wyoming, New Hampshire, Iowa, and Mississippi.

· 66,000 – Number of children in Oklahoma age 0-3 who received SNAP food benefits to support good health and food security. SNAP is the federal Supplemental Nutrition Assistance Program.

· 62,518 – Number of children in Oklahoma who received healthy meals and snacks on an average workday in child care participating in CACFP. CACFP is the federal Child and Adult Care Food Program.

· 3 – The number of states, including Oklahoma, that have the most racially diverse rural school districts in the country. The other two are Delaware and North Carolina.

· 200,000 – Approximate number of students in Oklahoma’s rural districts who rank among the most diverse in the nation in terms of race, specialized needs, poverty, and residential instability.

See previous Numbers of the Day and sources here.

Capitol Express Newsletter: President Signs Temporary Funding Bill, House Passes Disaster Resilience Legislation

CONGRESS

President Signs Temporary Spending Bill to Fund Federal Agencies

On November 21, the President signed a continuing resolution (CR) passed by Congress that will fund the government at current spending levels through December 20. This stopgap measure prevented a government shutdown and now provides lawmakers with four weeks to reach a comprehensive FY20 spending agreement.

Sources are also reporting that top appropriators in the Senate and the House have reached a deal on spending levels for the dozen yearly appropriations bills over the weekend. Now that Congress has agreed to top-line spending numbers, known as 302(b)s, lawmakers will be able to move forward finalizing FY20 spending bills. As negotiations unfold, Enterprise encourages Congress to provide the highest possible funding levels for critical affordable housing and community development programs.

Congresswoman Maxine Waters and Senator Kamala Harris Introduce Affordable Housing Bill

On November 21, House Financial Services Chairwoman Maxine Waters (D-CA-43) and Sen. Kamala Harris (D-CA) introduced the Housing is Infrastructure Act of 2019 (S.2951 & H.R.5187), a bill to invest over $100 billion in federal programs aimed at addressing housing affordability, including $70 billion to repair public housing.

The bill would also help spur affordable housing construction and development in low-income communities by providing $10 billion for the Community Development Block Grant Program, as well as $5 billion each for the HOME Investment Partnership Program and the Housing Trust Fund. It would also boost funding for the Capital Magnet Fund, catalyze development on Native American reservations through the Native American Housing Block Grant Program, and provide key funding for mitigation projects to limit damage from future disasters, among other things. Finally, the bill requires grantees to conduct outreach to minority and women owned businesses to inform them of opportunities created through the new funds.

DISASTER RESILIENCE

House Passes the Reforming Disaster Recovery Act of 2019

On November 18, the House passed the Reforming Disaster Recovery Act of 2019 (H.R.3702) with strong bipartisan support by a vote of 290-118. The bill, which passed out of the House Financial Services Committee this summer unanimously, was introduced by Reps. Al Green (D-TX-9) and Ann Wagner (R-MO-2) and would strengthen and permanently authorize the Community Development Block Grant–Disaster Recovery (CDBG-DR) Program. Sens. Brian Schatz (D-HI) and Todd Young’s (R-IN) companion legislation (S.2301), which has been assigned to the Senate Banking, Housing, and Urban Affairs Committee, will now need to pass in the Senate.

If enacted, the bill would help target CDBG-DR resources to survivors with the greatest need, ensure greater data transparency and oversight, protect civil rights and fair housing, and encourage mitigation and resiliency. Click on the following links to stay up to date on the status of S.2301 and H.R.3702.

2020 ELECTION

Presidential Candidates Steyer and Warren Issue New Housing Policy Plans

Earlier last month, presidential candidate Mr. Tom Steyer released his plan, “Partnerships with Rural Communities,” that includes a housing component. The plan proposes expanding programs in the U.S. Department of Agriculture’s Rural Housing Service and Bureau of Indian Affairs Housing Improvement Program for affordable housing, including programs to develop new housing, renovate older units, and provide senior housing. The plan also prioritizes projects that build farm worker housing in towns rather than on job sites, incentivizes home weatherization programs through the restoration of the Low-Income Home Energy Assistance Program, and enforces regulations against predatory landlords. To read Mr. Steyer’s full rural plan, click here.

Last month, Sen. Elizabeth Warren’s (D-MA) campaign released her plan, “Protecting and Empowering Renters,” a supplement to the housing policy platform she released this past March. The plan to protect and empower renters has four stated goals: 1) Protect and uphold the rights of tenants; 2) Tackle the growing cost of rent; 3) Invest in safe, healthy, and green public housing; and 4) Fight exploitation by corporate landlords. To read this supplemental plan, click here. To read Sen. Warren’s full housing plan released this past spring, click here.

NCSHA Washington Report

Martha Ross and Nicole Bateman of the Brookings Institution have produced a remarkable analysis of the demographics of America’s “low-wage” workforce: the 53 million people between the ages of 18 and 64 who roughly earn a median $10 an hour and $18,000 a year.

Among their findings:

  • Fifty-two percent are white, 25 percent are Latino or Hispanic, 15 percent are black, and 5 percent are Asian American.
  • Fifty-four percent are women.
  • More than half “are the sole earners in their families or make major contributions to family income.”
  • Their share of the workforce ranges from 30 to 62 percent across more than 300 metro areas, with higher shares generally in smaller communities in the southern and western U.S.

An affordable rent for the typical Brookings-defined low-wage worker would be a little less than $600. The number of apartments available around that price point has fallen in almost every state and by nearly four million overall since 1990, according to Harvard’s Joint Center for Housing Studies.

The National Low Income Housing Coalition estimates the average hourly wage needed to reasonably afford a modest two-bedroom apartment nationwide is roughly $23 — more than double what the typical low-wage earner brings home (and more than triple the federal minimum wage).

Given that more than 70 percent of households with incomes under $15,000 pay more than 50 percent of their incomes for rent, it’s likely that millions of the low-wage workers the Brookings researchers identify must bear this “severe housing cost burden.”

Harvard’s Joint Center reports that severely cost-burdened families with children in the bottom 25 percent by income spend $260 less each month for food than “the lowest-cost plan recommended by the U.S. Department of Agriculture for a family of four.” They spend 74 percent less on healthcare than families in the same group who pay an affordable rent.

The Housing Credit, administered by every state HFA except two, serves households with a median income of less than $18,000, according to HUD. NCSHA data show that more than 30 percent of the HOME funds administered by 39 state HFAs reach families HUD considers “extremely low-income.” Project-Based Rental Assistance, administered by 38 state HFAs, supports residents with an average income of less than $12,000, according to HUD.

These and other housing assistance programs will remain essential for low-wage workers for the foreseeable future. As the Brookings analysts grimly conclude:

“Research on whether low-wage jobs are springboards or sinkholes is not encouraging. The economic mobility of low-wage workers is limited — many remain in low-wage jobs over time, even as they rely on their earnings to support themselves or their families. Women, people of color, and those with low levels of education are the most likely to stay in low-wage jobs.”

Housing financed and administered by state HFAs is not always seen in the fabric of the nation’s “social safety net.” For the large share of it that’s home to our country’s low-wage workers, not to mention many elderly and disabled residents, it should be.

CohnReznick Finds Housing Credit Equity Investment Hit Record High in 2018

CohnReznick Finds Housing Credit Equity Investment Hit Record High in 2018

Last Month, CohnReznick’s Tax Credit Investment Services team released its 2019 Housing Tax Credit Investments: Investment and Operational Performance report, with updated data on Housing Credit performance based on its survey of syndicators and direct investors, covering 21,000 Housing Credit properties.

Key findings in the report include:

  • Investors made an estimated $16.4 billion in Housing Credit equity investments in 2018, the highest level ever. Of that total, 70 percent was syndicated and 30 percent was directly invested.
  • Properties included in the survey had a physical occupancy rate of 97.8 percent in 2018, indicating ongoing low vacancy rates for Housing Credit properties.
  • Only 11 percent of properties were on a “watch list” as of the end of 2018, meaning investors and syndicators are watching those properties closely due to a suboptimal risk rating. The number of properties on a watch list declined significantly from previous years.
  • The cumulative foreclosure rate of Housing Credit properties remained very low at just 0.65 percent of properties ever having gone into foreclosure in the program’s history.

The report also includes information on trends in fund investment performance, yield variance, per-unit cash flow, debt coverage ratio, and operating expenses.

CohnReznick has also developed interactive platforms to access both the performance and operating expense data in the report.

NCSHA Washington Report | November 2019

On the West Coast, in California, most everyone involved in residential development, construction, and sales is bracing for the sun to have a bigger role in their businesses: Starting January 1, virtually all new homes and apartments under three stories will have to have solar panels.

The California Energy Commission (CEC) projects the requirement will add an average of $8,000 – $10,000 to the upfront cost of a typical single-family home (and generate an average savings of $19,000 over 30 years). The National Association of Home Builders estimates that every $1,000 increase in price prevents around 10,000 households from affording a home, which suggests the California mandate could worsen affordability for 80,000 – 100,000 families.

The actual impact may be less severe. Home builders like Lennar, Meritage, and KB Home have been delivering moderately-priced solar homes in California and other states for years, building a viable market. Wider adoption could drive down solar panel costs, which have plunged 65 percent since 2009 due to manufacturing and installation improvements.

And innovations will likely emerge. California Building Industry Association CEO Dan Dunmoyer told the Los Angeles Times that alternatives to rooftop photovoltaic (PV) systems, such as “community solar” and offsite solar farms, could cut the CEC’s projected price increase by 85 percent.

While California will remain the nation’s major market for solar, industry analysts who project PV capacity to double in the next five years point to “a growing residential sector that is rapidly diversifying across state markets,” such as in Florida, South Carolina, Texas, and Utah.

Of course, most solar installations outside California will continue to be on existing homes. Importantly, “almost half of all the United States’ residential rooftop solar technical potential is on the dwellings of low-to-moderate-income (LMI) households,” mostly multifamily rental properties, according to the National Renewable Energy Laboratory.

All the barriers to making solar more widely available to LMI families will be familiar to anyone working to provide them better housing options: credit challenges, financing complexities, limited awareness, burdensome local regulation.

Still, it’s happening. State HFAs recently have integrated solar into senior rental apartments (Rhode Island Housing), prioritized it in Housing Credit awards (Mississippi HC), linked it to preservation and job training (DC HFA), and helped deliver it at a community scale (Texas DHCA).

In July, HUD issued guidance that will allow hundreds of thousands of low-income renters to fully realize the economic benefits of California’s $1 billion solar program for multifamily housing, which advocates hope “could pave the way for similar rulings affecting solar programs across the country.”

It’s often noted that solar generates a tiny share of the nation’s electricity (less than two percent). Yet the relatively small amount of installed solar produces enough power for more than 13 million homes.

In affordable housing, we recognize the power of leverage when we see it.