Natl Housing Trust Fund
The Federal Housing Finance Agency has authorized Fannie and Freddie to begin setting aside funds for the National Housing Trust Fund, which was created in the Housing and Economic Recovery Act of 2008.
Here is a summary of the pertinent facts:
- NHTF is designed “to increase and preserve the supply,” of housing affordable to Extremely Low Income (ELI) households;
- Funds will be available beginning in mid-2016 as a block grant to states based largely on the HOME formula;
- 90% of funding can be used for rental housing, the remaining 10% for homeownership activities;
- 75% of funds are for very low-income (0-30% AMI) and 25% for very low-income (31-50% AMI);
- Each state and the District of Columbia is to receive a minimum NHTF allocation of $3 million;
- 20% of funds can be used for operating costs;
- 30 year affordability or longer is required as determined by each state;
- NHTF law requires states to prepare an “Allocation Plan” every year. The Allocation Plan must show how the state will distribute the NHTF it will receive in the upcoming year. Distribution of NHTF must be based on priority housing needs in state’s Consolidated Plan.
See the link below for more detail
Funding for National Housing Trust Fund to Begin
National Housing Trust Fund Page on NLIHC.org
NLIHC Updated February 2016, State Allocations
Estimated State allocations for 2016 based on $186.6 million total
Priority to Serve Extremely Low-Income Households
A measure of the statute’s emphasis on Extremely Low-Income (ELI) renters is its provision that at least 75% of a state’s NHTF money be used for rental housing to benefit ELI households, and that no more than 10% the state’s NHTF be used for first-time homebuyer activities. The interim rule’s income targeting provisions reflect the statute.
For years in which there is less than $1 billion for the NHTF, states must use 100% of their allocation for the benefit of ELI households. For years with more than $1 billion available, states must use at least 75% of their NHTF for the benefit of ELI households, and may spend up to 25% for the benefit of VLI households. NLIHC estimates that during the initial years, there will be less than $1billion for the NHTF.
Housing Trust Fund Page on Hudexchange.info
Per 24 CFR 93.100, each State is required to notify (the Secretary of) HUD of its intent to become a grantee for HTF funding within 30 days after HUD publishes the formula allocation amounts (these amounts are expected to be published by April 2016).
The notification letter must also inform HUD of the name and contact information of State department/agency or State-Designated Entity (SDE) that will administer its HTF funds.
At the State level, selection of a State agency or designation of a SDE to administer its HTF funds will typically be made by the Governor or State Legislature in accordance with State law. The definition of a SDE for HTF can be found at 24 CFR 93.2. If a State designates a SDE to administer its HTF funds, a copy of the designation must be included in this transmittal.
States are encouraged to designate the State department/agency or SDE that will administer its HTF funds early in order to facilitate receipt of guidance and training from HUD timely. Therefore, States may submit the above referenced notification letter any time prior to the deadline.
In Virginia, the funds will be administered by the Department of Housing and Community Development (VADHCD), and it is estimated that the Commonwealth will receive $3.26 million in the first year. The application will be a competitive selection process with the criteria reviewing the applicant’s capacity, impact, readiness, leveraging of funds, support/stakeholder involvement, long-term sustainability, availability/proximity to amenities and services. As mentioned previously, funds are anticipated to be available mid-summer 2016.
For more information contact:
Chris Thompson, Deputy Director – Division of Housing
Department of Housing and Community Development