Senate Appropriations Committee Releases T-HUD Spending Bill
The Senate Appropriations Committee released on Monday drafts of the committee’s remaining nine fiscal year (FY) 2022 spending bills. This included funding for the Transportation, Housing, and Urban Development (T-HUD) spending bill, which provides critical funding for affordable housing programs. The Senate T-HUD bill includes $65.4 billion for HUD, or $5.7 billion above FY 2021 enacted levels.
The bill includes $51 billion to preserves affordable housing through rental assistance programs, including:
- $13.97 billion for project-based Section 8 rental assistance, $505 million more than FY 2021. This includes up to $355 million for the cost of contract administrators;
- $956 million for Sec. 202 Housing for the Elderly and $227 million for Sec. 811 Housing for Persons with Disabilities. This includes $125 million for the renewal of service coordinator grants.
Additionally, to expand the development of affordable housing, $1.45 billion is provided for the HOME Investment Partnership program, to construct nearly 10,000 new rental and homebuyer units and to provide rental assistance to over 19,000 low-income renter households. This level of funding is $100 million more than FY 2021.
The bill also includes program increases supporting low-income and historically disadvantage communities. This includes:
- $400 million is for HUD’s Office of Lead Hazard Control and Healthy Homes, $60 million more than FY 2021 in order to remediate lead-based paint from over 25,000 low-income households;
- $20 million for transit technical assistance and grants to areas of persistent poverty or disadvantaged communities to expand mobility in underserved communities.
The Senate Appropriations Committee previously approved three of the chamber’s FY 2022 bills, including funding for the Department of Agriculture, while the House of Representatives passed nine of its 12 bills earlier this summer. NAHMA urged Congressional leaders this week to support funding for affordable housing programs and will continue to monitor the bills progress through the Senate.
Senate Hearing on Impact of Private Equity Landlords
This week, the Senate Banking, Housing and Urban Affairs Committee held a hearing examining how private equity landlords are changing the housing market. Witnesses providing testimony included Sofia Lopez, Deputy Campaign Director on Housing for the Action Center on Race and the Economy; Holly Hook, Manufactured Home Resident and MHAction Leader from Swartz Creek, Michigan; and Norbert Michel, VP and Director of the Center for Monetary & Financial Alternatives at the Cato Institute. During the hearing, witnesses described how most rental units in the nation fall under some sort of corporate ownership—ranging from individuals with a limited liability company, up to larger corporations with thousands of properties under their control. Particularly, witnesses voiced their concerns to the Committee over the rise in private equity money in the housing market. Several witnesses described how investors are likely more attracted to locations where tenant rights are more favorable for landlords, have high population growth and high house price growth.
The Chairman of the Committee, Senator Sherrod Brown (D-OH), stated that he believed this is a trend dating back to the Great Recession, when investment firms began buying up distressed properties at drastically reduced-price points. He was particularly concerned that this trend is continuing under the guise of the pandemic and that when renters miss their payment, the response from private equity landlords is often impersonal, harsh and profit driven. With firms using such measures as rent increases as a tool to boost profits, one witness described the failure to capture fee revenue as “revenue leakage.” Ms. Lopez testified that the practice of requiring utilities to be in the company’s name and charging tenants the cost of utilities with an added fee, is an example of a common revenue generating practice. “In 2016, fees and clawbacks, including withholding tenants’ security deposit and generated $26 million in revenue for one private equity firm,” she said. Members also discussed the impact on small property owners, including how such “mom-and-pop” owners were much more distressed financially due to the pandemic, had not been collecting full rents and are now in a position where they either need to sell or want to sell.
To view the full hearing, click here.
House Committee Hearing Examines Need for Further Housing Assistance
On Thursday, the House Financial Services Committee held a hearing titled A Strong Foundation: How Housing is the Key to Building Back a Better America. During the hearing, witnesses described the need for increased funding to address racial and economic inequities that existed before Covid-19 struck and then worsened over the course of the pandemic. Specifically, members heard testimony regarding the impact of the pandemic on low-income families and communities of color. Witnesses testified before the Committee on the need for increased investment in affordable housing, and on the need to provide further assistance to owners, tenants, and first-generation homebuyers. “Policies that are created to supposedly help housing providers have actually kept us from being able to renew our century old buildings and left us with no choice but to leave apartments vacant. What’s been created are regulatory statutes that are so onerous that only the largest corporate owners have the funds to comply, leaving the rest of us small owners in a perpetual tailspin as we try to manage taxes, insurance, and maintenance, and that was before COVID-19,” testified Jan Lee, a small rental property owner from New York.
Witnesses also urged the Committee to support further investments in supply-side solutions and to ensure that a significant portion of these resources benefit households making below the area median income–those who need this assistance the most to renovate or buy a home for the first time. Several witnesses provided testimony on the importance of helping first-generation homeowners, or those homebuyers without a parent who is a homeowner. “Homeownership is generational. Children of homeowners tend to become homeowners. Children of renters are more likely to stay renters throughout their lifetime. We can, and we need to break this pattern” said Symone Crawford, Executive Director of the Massachusetts Affordable Housing Alliance.
To view the full hearing, click here. The Committee Memorandum is available here.