HUD, FHA Issue Condominium Rule

Last week HUD released the final rule on FHA approval for single-family condominiums. HUD touts the rule as opening the FHA single-family loan products to both younger, first-time home buyers and seniors looking to age-in-place.

The rule sets the policies to update the Single Family Policy Handbook, expand single-unit approval, establish minimum owner-occupancy requirements, limit FHA insurance concentration in condominium projects, and institute commercial/nonresidential space limits.  The rule is effective October 15, 2019, and HUD estimates that 20,000 to 60,000 condominium units could be eligible for FHA-insured financing annually.

HUD’s press release on the Condominium Approval Final Rule can be viewed here.

The Condominium Approval Final Rule is available here.

Presenters Updated! Tomorrow!! Complimentary PH Unit Preservation Webinar – July 2, 1pm ET

LAST CHANCE TO REGISTER. NAHRO is hosting a complimentary Public Housing Unit Preservation Webinar tomorrow, Tuesday, July 2, at 1pm eastern time. Join Andy Rodriguez, Executive Director of the Nampa (ID) Housing Authority; Edward Mayer, Executive Director of the Housing Authority of the County of Butte (CA); and Georgi Banna, NAHRO’s Director of Policy and Program Development who will share and overview of the preservation options and will their experiences and decision making process in preserving their Public Housing units.

This session is for agencies of all sizes from the smallest to the largest and will discuss HUD’s outreach, the options and first-hand PHA experiences. Below is information on the session and the registration link.

Public Housing Preservation Options – The PHA Perspective

Has HUD reached out to your agency to discuss the future of your public housing? Join us for this complimentary session to review your options, and the NAHRO Policy team is here to provide more information and help sort through a lot of the chatter. Are you interested in joining the Rental Assistance Demonstration (RAD), using the Section 18 Demolition/Disposition program, removing your Declaration of Trust, participating in a streamlined voluntary conversion process, or continuing in public housing? We’ll provide overviews of the options available to PHAs of all sizes and discuss HUD’s plans for the future. We will also be joined by Andy Rodriguez of the Nampa (ID) Housing Authority and Edward Mayer of the Housing Authority of the County of Butte (CA), who will share their experiences and decision making process in preserving their Public Housing.

Please register for Public Housing Preservation Options – The PHA Perspective on Jul 2, 2019 1:00 PM EDT at:

https://attendee.gotowebinar.com/register/4425060811873671691?source=blog2

After registering, you will receive a confirmation email containing information about joining the webinar.

Complimentary Webinar – Public Housing Repositioning – July 2, 1pm Eastern

On Tuesday, July 2, NAHRO will be hosting a complimentary webinar on HUD’s current effort of Public Housing Repositioning. Below is information on the session and the registration link. This session is for agencies of all sizes from the smallest to the largest and will discuss HUD’s outreach, the options and first-hand PHA experiences.

Public Housing Preservation Options – The PHA Perspective

Has HUD reached out to your agency to discuss the future of your public housing? Join us for this complimentary session to review your options, and the NAHRO Policy team is here to provide more information and help sort through a lot of the chatter. Are you interested in joining the Rental Assistance Demonstration (RAD), using the Section 18 Demolition/Disposition program, removing your Declaration of Trust, participating in a streamlined voluntary conversion process, or continuing in public housing? We’ll provide overviews of the options available to PHAs of all sizes and discuss HUD’s plans for the future. We will also be joined by Andy Rodriguez of the Nampa (ID) Housing Authority, who will share Nampa’s experiences and decision making process in preserving their Public Housing.

Please register for Public Housing Preservation Options – The PHA Perspective on Jul 2, 2019 1:00 PM EDT at:

https://attendee.gotowebinar.com/register/4425060811873671691?source=blog

After registering, you will receive a confirmation email containing information about joining the webinar.

Proposed Rule Requires Verification of Eligible Immigration Status for HUD Assistance

Tomorrow, HUD will publish in the Federal Register a proposed rule titled “Housing and Community Development Act of 1980: Verification of Eligible Status.” This proposed rule purports to change how families with mixed immigration statuses receive prorated HUD assistance. Comments are due 60 days after publication.

Current Proration of HUD Assistance

Currently, families with a mixed status may apply for assistance by declaring that each member of the family is 1) a U.S. citizen or eligible non-citizen; or 2) decide not to contend eligible immigration status (and not submit verification documentation) for that member. Family members that declare themselves eligible must provide acceptable evidence of immigration status. Verification is provided through the Systematic Alien Verification for Entitlements (SAVE) system–administered by the Department of Homeland Security (DHS). The system saves the information of noncitizens. Assistance is then prorated such that only citizen-members (or eligible non-citizen-members) of families receive funding (excluding those who do not contend their eligible immigration status).

Proposed Changes

This proposed rule would make two changes to the current system. First, the proposed rule would require that all family members (except those over the age of 62) have their immigration status verified through SAVE (i.e., family members would no longer have the option to not contend their eligible immigration status). Under most covered programs, those who have not submitted evidence of eligible immigration status will be required to do so at their first regular reexamination.

Second, the proposed rule would specify that individuals that do not have a verified eligible immigration status may not serve as the head of household or spouse–i.e., the holder of the lease.

The pre-publication copy of the proposed rule can be found here.

The published in the Federal Register version can be found here (available 5/10/2019).

 

Opportunity Zone Hearing on February 14 at 10am

The Treasury department has announced that on February 14 at 10am a public hearing will be held on proposed regulations concerning investing in qualified opportunity funds (QOF). February 14 is the new date for the Opportunity Zone public hearing that was originally scheduled for January 10 but was canceled due to the lapse in Federal appropriations.

The public hearing will focus on the proposed regulations that provide guidance under new section 1400Z-2 of the Internal Revenue Code (Code) relating to gains that may be deferred as a result of a taxpayer’s investment in a qualified opportunity fund (QOF).

The hearing is open to the public and will be held in the IRS Auditorium, Internal Revenue Service Building, 1111 Constitution Avenue, NW, Washington, DC. At this time, it does not appear that there will be a telephone or web-based broadcast of the hearing. NAHRO will attend the hearing and provide a summary of the hearing to our members.

Additional information on the February 14 Opportunity Zone public hearing can be found in the pre-publication Federal Register notice.

 

HUD Funds Available for February, But Not for March

NAHRO has learned that the Department of Housing and Urban Development (HUD) has enough money to ensure that February payments for the Housing Choice Voucher (HCV) program and the public housing Operating Fund will be made available to public housing authorities (PHAs). HUD intends to make those payments on time. NAHRO has also learned that there is not currently enough money to make HCV and Operating Fund payments for March, if the government shutdown continues until then.

In order to end the government shutdown, Congress must agree to a funding bill. Now is the time to reach out to your Congresspeople and demand that a fiscal year 2019 appropriations bill for HUD is passed. NAHRO has prepared a letter that can be sent to your Congressional members through the NAHRO Advocacy Action Center.

As PHAs make their voices heard to Congress, NAHRO will continue to fight for you and the families you serve and will continue to inform members as soon as we learn more.

Secretary Carson to Lead Opportunity and Revitalization Council

In a press release published earlier today, HUD announced that the President established the White House Opportunity and Revitalization Council and named Secretary Carson its chairperson. The White House Opportunity and Revitalization Council’s activities include the following:

  • Engage all levels of government on methods to effectively use taxpayer dollars to revitalize low-income communities;
  • Streamline, coordinate, and target existing Federal programs to Opportunity Zones and distressed communities;
  • Consider legislative proposals and undertake regulatory reform to remove barriers to revitalization; and
  • Present the President with options to encourage capital investment in economically distressed communities.

Secretary Carson has said that “[t]hese are still early days for the work of the Council and Opportunity Zones, but the groundwork has been laid . . . [t]he seeds the President has planted are growing and the promise they hold will improve places long forgotten, and the lives of those who call those places home.”

The full press release can be found here.

NAHRO Submits Comments on AFFH Rule Streamlining

Earlier this week, NAHRO responded to the Department of Housing and Urban Development’s (HUD’s or the Department’s) request for comments on streamlining the Affirmatively Furthering Fair Housing (AFFH) rule by submitting a comment letter. The National Association of Housing and Redevelopment Officials remains committed to following through on the promise of the Fair Housing Act and its duty to affirmatively further fair housing. At the same time, NAHRO believes that to create a workable rule that delivers results while appropriately balancing the goals of the Fair Housing Act with the limited resources found in communities throughout the United States, certain principles should be followed in refining the AFFH rule.

These general principles are as follows:

  • Entities should not be forced to complete analyses on non-housing factors;
  • Entities should not be forced to complete analyses outside their jurisdiction;
  • Additional funding is required to properly conduct fair housing assessments;
  • Housing agencies should be able to complete any required assessments without having to hire a consultant;
  • The Department should accept and approve assessments for entities that have made a good faith effort to comply with the assessment process;
  • The Department should provide clear, regularly updated guidance for completing assessments;
  • The assessments should provide a greater emphasis on place-based solutions; and
  • The Department should closely follow all requirements of the Administrative Procedure Act and any other process requirements required by law.

The comment letter–after providing background on how HUD substantially deviated from modest recommendations of prior technocratic reports by HUD and the Government Accountability Office (GAO) in 2009 and 2010 respectively–responds to specific inquiries requested by HUD. The comment letter also recommends changes to the definition of “Affirmatively Furthering Fair Housing” and “Qualified PHA.”

The full comment letter can be found here.

Federal Judge Dismisses AFFH Suit

In an opinion published on Friday, a federal judge dismissed a suit brought by several fair housing organizations. The fair housing groups wanted HUD to reinstate the local government assessment tool as part of the Affirmatively Furthering Fair Housing (AFFH) process. The court found that the groups did not meet the requirements to sue and that even if they did, HUD should not be required to reinstate the local government tool.

After providing background information and describing the relevant law, the opinion discussed three issues. First, whether the fair housing groups had standing (i.e., met the legal requirements to sue); second, whether the fair housing groups were entitled to a preliminary injunction reinstating the assessment tool for local governments; and third, whether New York State could join the suit. The court found that the fair groups lacked standing (i.e., did not meet the legal requirements to bring suit); that even if they had standing, they were not entitled to a preliminary injunction ordering that the local government tool be reinstated; and that New York State could not join the suit.

Fair Housing Groups Lack Standing

The court found that the fair housing groups lacked standing and could not bring a suit. Although the court found multiple reasons why the fair housing groups lacked standing, the court focused most of its analysis on how there was a lack of injury to the fair housing groups by the withdrawal of the local government tool. The court found that the withdrawal of the local government tool did not impair the mission of the fair housing groups because many aspects of the AFFH rule remain in place, including the new community participation requirements, which give the fair housing groups continuing opportunities to participate in a more robust Analysis of Impediments (AI) process. The court also found that withdrawal of the local government tool did not cause a drain of the fair housing groups’ resources because they are engaged in the same types of activities that they were undertaking before the withdrawal of the local government tool and because withdrawal of the tool does not require that the groups spend more on operational costs. Finally, the court also found that the fair housing groups lacked the other elements of standing–causation and redressability.

Fair Housing Groups Not Entitled to a Preliminary Injunction

The court found that even if the fair housing groups had standing, they were not entitled to a preliminary injunction. Again, although there were several reasons why they were not entitled to a preliminary injunction, the court focused its analysis on showing why the fair housing groups were unlikely to succeed on the merits of the case. First, the court noted that withdrawal of the local government tool did not require notice-and-comment procedures (these are the procedures used in the informal rulemaking process when an agency is creating a regulation) because the local government tool is properly characterized as an “information collection” and not subject to notice-and-comment procedures. Second, the court found that the withdrawal of the tool was not arbitrary or capricious because HUD provided adequate reasoning for its decision to withdraw the local government tool (HUD noted the high failure rate of program participants to submit acceptable first-time submissions and the high costs of scaling up technical assistance for future submissions). The court also did not find the other factors needed for a preliminary injunction including a risk of irreparable harm, a balance of equities in favor of the fair housing groups, or an accord with the public interest.

New York State May Not Join the Suit

The court found that New York State may not join the suit because, like the fair housing groups, it lacked standing because of a lack of injury.

The full opinion can be found here.

HUD to Reopen AFFH Rule

Earlier today, HUD published a press release announcing that it published a notice inviting public comment on amendments to its Affirmatively Furthering Fair Housing (AFFH) regulation.

[8/16/18 Edit – the notice has been published in the Federal Register. It can be found here. The comment due date is October 15, 2018.]

The Department wishes to receive comments on amending the rule so that it does the following:

  1. minimizes regulatory burden while more effectively aiding program participants to meet their statutory obligations;
  2. creates a process focused primarily on accomplishing positive results, rather than on analysis;
  3. provides for greater local control and innovation;
  4. seeks to encourage actions that increase housing choice, including through greater housing supply; and
  5. more efficiently utilizes HUD resources.

Currently, HUD has suspended the obligation of local governments to file Assessments of Fair Housing (AFHs) using the local government tool. The Department believed that the tool was “confusing, difficult to use, contained errors, and frequently produced unacceptable assessments, and otherwise required an unsustainable level of technical assistance.” There is currently a lawsuit brought by three civil rights groups filed against HUD on its action suspending requirements of the rule.

NAHRO will provide additional information to our members as we continue to read through the notice and as additional information becomes available.

The Department’s press release can be found here.

A pre-publication copy of the Advance Notice of Proposed Rulemaking can be found here.

[8/16/18 Edit – the published copy can be found here.]