HOME Program Update NCDA Conference January 19, 2012

FY 2012 HOME Budget FY 2012 Appropriation - $1 Billion This is the FY 1993 funding level for HOME Lowest appropriation for HOME There are 300 more local PJs than in FY % decrease from FY 2011 $1,606,780,000 – 55% decrease from FY 2009 and 2010 $1,825,000,000 2

FY 2012 HOME Budget Formula used American Communities Survey Data for the first time Major changes in allocation amounts for some PJs CPD provided analysis of effect by formula factor 3

FY 2012 Appropriation Language 1) Project Certification - before committing FY 2012 HOME funds, PJ must certify that it has: – Conducted an underwriting review; – Assessed developer capacity and fiscal soundness; – Examined neighborhood market conditions to ensure adequate need for project. PJ certifies in IDIS at time of project funding Applies to projects identified as FY 2012 Action Plan activities/projects Proposed rule includes similar provision 4

FY 2012 Appropriation Language 2) CHDO Capacity – PJ may not commit FY 2012 funds to a CHDO unless it has determined that nonprofit has staff with demonstrated development experience – Volunteers, board members, and consultants are not staff – Applies to FY 2012 CHDO set-aside funds – Proposed rule includes similar provision 5

FY 2012 Appropriation Language 3) Project Completion – PJs must repay funds expended on projects that are not completed and ready for occupancy within 4 years of the date written agreement is executed. HUD may grant a one-year extension. – Applies to projects identified as 2012 Action Plan activities – Proposed Rule includes similar provision 6

FY 2012 Appropriation Language 4) Deadline for Sale of Homebuyer Units – if unit not been sold to homebuyer within 6 months of completion of rehab/construction, it must be converted to a HOME rental unit – Applies to units identified as FY 2012 Action Plan activities/projects – No exception authority – Proposed rule includes similar provision 7

FY 2012 Appropriation Language P.L also requires HUD to: – report annually to Congress on all unexpended HOME funds that are more than 5 years old Grant level report – report to Congress on data quality, data management, and grantee oversight and accountability for all CPD programs Must propose improvements and timelines for implementing them 8

HOME Proposed Rule Published: December 16, 2011 Public Comments Due: February 14, 2012 Changes address: – PJ accountability and oversight – CHDO capacity and performance – Clarifications HUD webinar: January 24 (1:30–3:30 pm EST) Final Rule expected: Fall

New/Upcoming Policy HOME & NSP Guide posted on NSP webpage Resale and Recapture Notice – – placed in Departmental clearance last week – to be issued in February 10

HOME TA Unsold Inventory Webinars – older projects – Invitation only, by region – January 26 and 27 General Webinar for PJs – aggressive marketing strategies, lease-purchase, rental conversions - February 11

Housing Trust Fund Update Housing Trust Fund Proposed Rule Comment Period Closed 12/28/10 FY 2012 Funding Request: $1 billion Final Rule – Issued as part of HOME Final Rule (Fall 2012) 12

News Brief HOME rents and income limits – Memo dated January 10th /effective February 10th HOME FACTS on converting homebuyer activities to rental activities in IDIS – Posted this week Open Activities and Vacant Units Reports now in IDIS – PR48 and PR47 Old HOME funds cleanup – 1992 – 2001 HOME grants – $19.3 million unexpended of which $11 million is uncommitted 13

HOME Accomplishments Over history of the HOME program (through November 30, 2011): – 1,046,010 HOME units completed – 253,662 households received TBRA 14

HOME FY 2011 Accomplishments 15 In FY 2011, 69,892 units completed (largest number since 2007) 39,162 rental units 21,593 homebuyer units 9,137 homeowner rehab units 15,683 households assisted with TBRA (smallest number in last 5 yrs)

HOME FY 2011 Accomplishments Open activities decreased by 25 percent between November 2010 (28,077) and September 2011 (21,121) 9,833 open activities in final draw completed 82 percent of the 11,922 at the start of FY ,714 activities auto-cancelled (since January 2011) $479 million becoming available to commit 16

IDIS System Improvements Auto-cancellation – completed Program income and other financial enhancements – April 2012 System flags and required PJ action for: – Activities in final draw for > 120 days – Activities with an initial disbursement but no subsequent disbursement for > 180 days Edit to activity completion date – no pre-dating Underwriting certification New notification and reports 17

Expiring HOME Funds Any HOME funds not expended within 8 years of the beginning of the federal fiscal year of appropriation will be recaptured by U.S. Treasury – This is in addition to the HOME 5-year expenditure rule – Funds typically “stuck” in subfunds and subgrants in IDIS FY 2005 HOME funds subject to recapture by U.S. Treasury on 9/30/2012 – $42.5 million currently subject to recapture 18