HUD ALLOCATES $174 MILLION THROUGH NEW HOUSING TRUST FUND

WASHINGTON – For the first time ever, the U.S. Department of Housing and Urban Development (HUD) today allocated nearly $174 million through the nation’s Housing Trust Fund (see list of state allocations below). The Housing Trust Fund is a new affordable housing production program that will complement existing Federal, state and local efforts to increase and preserve the supply of decent, safe, and sanitary affordable housing for extremely low- and very low-income households, including families experiencing homelessness.

“Today, we offer another tool to help states confront a growing affordable rental housing crisis in this country,” said HUD Secretary Julián Castro. “The Housing Trust Fund will be an enduring resource designed to producing more housing that is affordable to our most vulnerable neighbors.”

“In today’s housing market, many Americans who work hard still can’t afford their rents. Affordable housing helps workers live closer to their jobs and spend more time with their families. A healthy housing market is key to vibrant communities and future economic growth, and these federal funds will help states expand the supply of affordable homes and strengthen our communities,” said Senator Jack Reed (Rhode Island), who wrote the 2008 law establishing the National Housing Trust Fund. “I commend HUD for making these funds available and helping states take a tailored, cost-effective approach to increasing the supply of affordable housing.”

Diane Yentel, President and Chief Executive Officer of the National Low Income Housing Coalition, added, “Today is a historic day for millions of Americans who struggle to find affordable housing. We applaud Secretary Castro for his leadership in paving the way to make the National Housing Trust Fund a reality. We look forward to working with the administration and our state partners as we put these dollars to work building affordable homes for the lowest income people.”

Eight years after it was authorized by the Housing and Economic Recovery Act of 2008 (HERA), the Housing Trust Fund is only now being capitalized through contributions made by Fannie Mae and Freddie Mac. In December 2014, the Federal Housing Finance Agency (FHFA) directed these Government Sponsored Enterprises (GSEs) to begin setting aside and allocating funds to the Housing Trust. In January of 2015, HUD issued interim rules to guide states on how to implement their Housing Trust Funds. 

By law, each state is allocated a minimum of $3 million. State affordable housing planners will use these funds for the following eligible activities:

•Real property acquisition

•Site improvements and development hard costs

•Related soft costs

•Demolition

•Financing costs

•Relocation assistance

•Operating cost assistance for rental housing (up to 30% of each grant)

•Reasonable administrative and planning costs