Housing Trust Fund
HUD has released the interim rules for distribution of the Housing Trust Fund (HTF), created by Congress in 2008 to support the preservation and new construction of affordable housing for households at extremely low levels of income. After sitting empty though the Great Recession, the fund will now be capitalized with fees from ongoing business programs at Fannie Mae and Freddie Mac. It is expected that in the first few years of the fund, it will distribute approximately $250 – $300 million annually, starting in mid-2016.
Similar to the allocation of tax credits, these federal funds will be distributed through an identified state agency, and applicants will be required to adhere to the eligibility rules and restrictions imposed by HUD, and in some instances by their states. With the publication of the interim rules, now is the time for states to develop their allocation plans to meet their affordable housing needs.
However, there are members of Congress who have expressed strong opposition to the HTF, and Congressman Ed Royce (CA) has introduced legislation barring any use of proceeds from Fannie and Freddie. Given the overwhelming need of thousands of families who earn very little income, we hope that more reasonable heads will prevail, and this sorely needed resource will become available.
Enterprise Community Partners has provided an excellent summary of what will happen with the HTF as it moves forward, and you can read it here.