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1 Understanding Tenant Based Rental Assistance Presented By: Candace Baldwin NCB Capital Impact & Brenda Hampton Illinois Department of Human Services.

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Presentation on theme: "1 Understanding Tenant Based Rental Assistance Presented By: Candace Baldwin NCB Capital Impact & Brenda Hampton Illinois Department of Human Services."— Presentation transcript:

1 1 Understanding Tenant Based Rental Assistance Presented By: Candace Baldwin NCB Capital Impact & Brenda Hampton Illinois Department of Human Services

2 2 Agenda Introduction of Speakers Discussion Points –Current development subsidies do not “drill down” to income levels of MFP participants –Housing Choice Voucher (a.k.a. Section 8) are over subscribed and not readily available –Alternative sources of funding for rental assistance that could be utilized –States have implemented bridge rental subsidy programs linked to Housing Choice Voucher Open Discussion

3 3 Development subsidies do not create affordable housing for MFP population Traditional affordable housing finance tools do not drill rents down far enough to meet MFP participant’s level of income Housing Choice Vouchers (HCV) are over- subscribed Tenant based rental assistance is needed to make rents affordable for community integration

4 4 Tenant Based Rental Assistance (TBRA) is derived based upon recipient’s income No more than 30% of resident’s income Like vouchers, tenant based rental assistance programs fill the gap “Gap” is difference between 30% of resident’s income and fair market rent (FMR) FMR* set annually by HUD based upon local markets *For more information on how to find the fair market rent for local area visit:

5 5 There are a number of Alternative Sources for TBRA Tenant based rental assistance can be sourced from: –HOME funds –Housing Trust Funds Typically locally controlled Follow similar eligibility guidelines as housing choice vouchers

6 6 HOME funds are Typically Overlooked as a Source for Rental Assistance HOME funds are administered through a participating jurisdiction (PJs) State or local government designated by HUD to administer HOME funds Small cities and counties are administered by State HFA Rental housing units must meet HUD qualification Length of rental assistance contract set by program guidelines

7 7 HOME funds can Assist in Transitioning MFP participants into the Community Uses for HOME funds can cover: –Housing costs such as rent –Utility costs and/or deposits –Security deposits Limited to tenants with incomes at or below 80 percent of area median income Participating jurisdiction has to include TBRA as an activity in consolidated plan Contracts for two years and are renewable

8 8 Housing Trust Funds can also be Used for Rental Assistance Trust funds can be administered by state or local governments 38 state housing trust funds in the U.S. Funded through fees assessed – e.g. real estate transfer tax, document recording fees, application fees Not subject to federal regulations – leads to flexibility of eligible uses

9 9 A Number of States use Housing Trust Funds for Rental Assistance Minnesota Housing Trust Fund –Established in 1988 –2002 expanded use of funds for rental assistance –Funds administered through designated agencies and organizations through RFP process Oregon Low Income Rental Assistance –Department of Housing and Community Development –Referrals through community partner organizations

10 10 HOME and Trust Funds face similar challenges to HCV Funding for both programs subject to availability of funds annually Annualized payment creates a long term funding commitment rather than one time development subsidy Not all HOME or Trust Funds are designated for tenant based rental assistance

11 11 Expanding use of TBRA funds for MFP Participants Requires Outreach HOME Funds –Contact PJ and state HFA to discern if TBRA is use of program –Consolidated Plan updates – public process –Request prioritization of funds to be directed to MFP initiative Housing Trust Funds –Similar strategy to HOME funds –Identify innovative sources of funds to increase trust fund appropriation

12 12 Bridge Rental Subsidy Programs can also be tied to more than just Vouchers Number of states have employed bridge rental subsidy programs –Iowa HCBS Bridge Rental Subsidy Program –Maryland Bridge Rental Subsidy Program Focused on participant securing housing choice voucher May consider allowing TBRA through HOME or Trust Funds to be the transition to permanent rental assistance

13 13 For more information Candace Baldwin Senior Policy Advisor NCB Capital Impact 703-647-2352

14 14 MFP Presentation October 8, 2008

15 15 Illinois Department of Human Services/Division of Mental Health Permanent Supportive Housing and Bridge Subsidy Program

16 16 Participating partners: zTechnical Assistance Collaborative, Inc. (TAC), Boston, MA zCorporation for Supportive Housing (CSH), Chicago, IL zIllinois Housing Development Authority (IHDA) zPubic Housing Authorities (contractual agreement) zRegional Housing Support Facilitators

17 17 Permanent Supportive Housing Housing Policy (PSH) Statement: zThe Department of Human Services, Division of Mental Health is committed to, as a priority toward systems rebalancing, the development and expansion of Permanent Supportive Housing (PSH) for individuals who meet defined criteria of eligibility and who are diagnosed with a serious mental illness.

18 18 Permanent Supportive Housing Housing Policy Statement (cont): zThe goal of this initiative is to promote and stabilize consumer Recovery with elective support services in one’s leased or owned home that (1) provides safety ; (2) ensures comfort and decency ; (3) is financially manageable within resources that the consumer has available.

19 19 Illinois - PSH model: zTypically rental apartments linked with flexible community-based support services: zSelf contained unit (bathroom & kitchen) zScattered sites zStudio or efficiency units zone bedroom apartments ztwo bedroom shared apartment

20 20 Illinois - PSH model (cont) zSites with three or more unrelated individuals are considered as Group Homes zGroup Homes will not qualify as acceptable residential options under the PSH model.

21 21 Illinois - PSH model (cont) zServices are linked to housing, but are considered voluntary. zServices are not a contingency to retain housing. zHousing is considered permanent. zLandlord/tenant law governs. zTenant hold the lease, sublease or rental agreement.

22 22 Illinois - PSH model (cont) zTenant controls access to his or her dwelling unit in accordance with applicable landlord/tenant law. zTenant-based rental assistance dollars (one-time) available to eligible/approved DMH consumers - Bridge Subsidy Program*

23 23 Support Services: zThe full array of DMH Support Services are available based on medical necessity. zSupport Services are flexible based on consumer choice. zCommunity mental health engagement is a requirement in the PSH referral and application processes. zCommunity providers have an expectation to continue outreach to consumers in PSH.

24 24 PSH priority population zResidents of Long Term Care (nursing homes-NF) zExtended care patients of State Psychiatric Hospitals zIndividuals at risk of placement in a NF zAging out young adults (DCFS wards or Individual Care Grant ) zResidents of existing DMH contracted Supervised or Supported Residential settings.

25 25 PSH Eligibility Criteria zDiagnosis of Serious Mental Illness. zIncome within 30% or below Area Medium Income (AMI). zReferred and approved by a DMH contracted vendor through outlined processes.

26 26 PSH - Bridge Subsidy Program zFinancing - $7.5 million dollars over five years were allocated by State legislative appropriation (Hospital Tax_Lock Box) to develop opportunities for eligible/identified individuals to transition to affordable community-living alternatives.

27 27 Bridge Subsidy Program... zRequires income at or below 30% Medium Area Income. zPays 70% of the rental cost - applied to the lease. zRequires that the consumer pay 30% of his/her income - applied to the lease (if a consumer has no income, Bridge will cover 100% cost).

28 28 Bridge Subsidy Program.. zRequires that all individuals approved for Bridge either apply for a Section 8 Voucher or other rental programs or get on a waiting list for a rental voucher. zRental cost is calculated against the Fair Market Rental rate, by county (rental units cannot exceed this amount). zIncludes a $2,000 one time Transition Fund, (maximum $2,800 for a lifetime).

29 29 Bridge Subsidy Administration zDMH has contracted with (at least one) Local Housing Authority in each Region to serve as a Subsidy Administrator (SA) zTwo contracts are with entities that have subsidy administration experience: one of the two will serve as a SA in all areas of the state without a contracted HA. zSA will conduct initial Housing Quality

30 30 Bridge Subsidy Administration standard unit inspections according to HUD specifications. zSA will assist as a resource with landlord search. zSA will certify consumer income. zSA will respond to Request to Lease. zSA will negotiate unit rental price that meets HUDs rent reasonableness test.

31 31 Bridge Subsidy Administration zSA will conduct initial income certification. zSA will execute Housing Assistance Payment (HAP) contract with landlord. zSA will pay security deposit, utility deposit and monthly rent according to the BHAP. zSA will conduct annual income recertification. zSA will submit monthly reports and quarterly fiscal reconciliation to DMH.

32 32 Transition Fund Requisition Forms A&B (attachments) zOne SA will process Transition Fund request (Form B) for household purchases for the entire state. zTransition Form - Instructions zTransition Form A - Used by SA for identification of payment for security deposit, utility deposit and reimbursement fees. zTransition Form B - Used by care managers to access a ‘bank card’ for consumer household purchases.

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