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HUD Issues HOME-ARP Implementation Notice
The Department of Housing and Urban Development (HUD) has recently published the HOME-ARP implementation notice for the use of funds under the American Rescue Plan. Notice CPD-21-10 establishes the requirements for the $5 billion provided under the American Rescue Plan Act through the HOME program (HOME-ARP). The funding is intended to provide housing and services primarily for households experiencing or at risk of homelessness. The notice is effective immediately.
To view the notice, click the Web Link provided.
Industry Trends
"Fannie Mae, Freddie Mac to Increase LIHTC Investments"
Congress
"House Panel Advances Key Portion of Democrats' $3.5 Trillion Bill"
"DASH Act’s Low-Income Housing Tax Credit Provisions Could Finance More Than 1 Million Additional Affordable Rental Homes"
Federal Regulation
"Analysis: Is 'Go Big' Housing Plan Enough?"
"Low-Income Lending Rules Set for Broad Overhaul"
State and Local Activities
"Iowa Targets $100 Million in COVID-19 Relief Funding to Address State Housing Shortage"
Green Building
"Granholm Announces New Building Energy Codes"
"How Air Barriers Help Boost Energy Efficiency"
Association News
NAHMA Announces October 2021 Meeting Reverts to Virtual
NAHMA Drug-Free Kids Calendars on Sale
Time to Start Your COQ Award Application
NAHMA Releases 2021 Affordable 100 List
Become a Specialist in Housing Credit Management® (SHCM®) Company!
Upcoming Events
Industry Trends
Fannie Mae, Freddie Mac to Increase LIHTC Investments
Affordable Housing Finance (09/01/21)
The Federal Housing Finance Agency (FHFA) says Fannie Mae and Freddie Mac can each invest up to $850 million annually in Low-Income Housing Tax Credits (LIHTCs), up from the previous $500 million cap. Within the higher yearly funding cap, any investments above $425 million in a given year must be in areas identified by FHFA as markets facing difficulty in attracting investors. This indicates an increase in investments that support housing in Duty to Serve-designated rural areas, preserve affordable housing, support mixed-income housing, provide supportive housing, or that meet other affordable housing goals. FHFA's acting director, Sandra L. Thompson, says, "Increasing the amount each enterprise can invest in the LIHTC market, especially in areas that have difficulty attracting investors, will help expand the supply of affordable housing across the country." The government-sponsored enterprises were allowed to return to the LIHTC market on a limited basis in late 2017 after being placed in a conservatorship by FHFA in 2008. Debby Jenkins, executive vice president and head of multifamily for Freddie Mac, says, "Freddie Mac has built a robust LIHTC equity investment program, with more than 120 investments in 26 states and Puerto Rico and Guam since 2018. This work has supported the preservation or creation of thousands of units of rental housing, meeting the needs of underserved communities throughout the country." Fannie Mae also said it will ramp up its activities as a result of the cap increase.
Congress
House Panel Advances Key Portion of Democrats' $3.5 Trillion Bill
The Hill (09/15/21) Jagoda, Naomi; Folley, Aris
The House Ways and Means Committee on Wednesday approved a major portion of Democrats’ $3.5 trillion social spending package, including provisions that would expand the Low-Income Housing Tax Credit. Ways and Means Committee Chairman Richard Neal (D-Mass.) touted the legislative proposals shortly after their passage on Wednesday, saying the planned investments would make the nation “more prosperous, equitable and fair.” The committee on Wednesday in a final vote of 24-19 voted to send the entirety of the panel’s legislation to the Budget Committee. Democrats are hoping to pass the full $3.5 trillion package in the coming weeks using reconciliation, a procedural process that allows them to bypass the Senate filibuster.
DASH Act’s Low-Income Housing Tax Credit Provisions Could Finance More Than 1 Million Additional Affordable Rental Homes
Notes from Novogradac (09/02/2021) Wallace, Dirk; Lawrence, Peter
The Decent, Affordable, Safe Housing for All (DASH) Act, introduced by Senate Finance Committee Chairperson Sen. Ron Wyden (D-OR) in August, is expected to be formally introduced in September. Novogradac estimates that nearly 1.1 million additional affordable rental homes could be financed by implementing the DASH Act's Low-Income Housing Tax Credit (LIHTC) financing provisions. The act calls for temporarily lowering the "financed-by" threshold from 50 percent to 25 percent for private activity bond (PAB) financed housing for 2021-24 multifamily PAB issuances only and placed in service after Dec. 31, 2021. Additionally, the 12.5 percent temporary allocation increase in the 9 percent LIHTC passed in 2018 and scheduled to expire at the end of this year would become permanent. There would be two annual 25 percent increases to the 2021 9 percent LIHTC allocation — $2.81 per capita with $3,245,625 small state minimum under current law — an inflation adjustment for 2022, and a 10 percent increase on that adjusted amount for the extremely low-income (ELI) increase. Furthermore, the DASH Act would increase annual 9 percent LIHTC allocations to $3.88 per capita with a $4,462,734 small state minimum for 2021, $4.92 per capita with a $5,670,462 small state minimum for 2022, and inflation adjustments based on this new baseline for 2023 and thereafter. The DASH Act also proposes up to a 50 percent basis boost for properties that include units specifically for ELI households (those earning the greater of the federal poverty line or 30 percent of the area median income). Not more than 90 percent of 9 percent LIHTC allocations could be for buildings that reserve less than 20 percent of their units for ELI households.
Federal Regulation
Analysis: Is 'Go Big' Housing Plan Enough?
Multi-Housing News (09/12/21) Fiorilla, Paul
The Biden administration is pledging to provide unprecedented support and funding for housing programs, but is also proposing tax increases on real estate firms, which could affect investment. Efforts to fund new housing include greater use of Low-Income Housing Tax Credits (LIHTCs) and extending government-sponsored enterprises’ (GSEs) ability to finance small rental properties. By expanding by $700 million the amount of LIHTC loans that Fannie Mae and Freddie Mac are authorized to purchase, each GSE can now purchase up $850 million of such loans, up from $500 million. Other proposals include using fees from Fannie and Freddie to work with community development and nonprofit groups to build affordable housing; expanding the GSEs’ authority to finance manufactured housing units and two- and four-unit apartments; and reinstating a Federal Housing Administration program that provides low-cost Ginnie Mae loans to finance new affordable apartments. This revived program would have no funding limits, and housing finance agencies have three years to execute deals. The administration also proposes to direct the Department of Housing and Urban Development to employ block grants and work with communities to identify housing affordability solutions.
Low-Income Lending Rules Set for Broad Overhaul
Wall Street Journal (07/21/21) Ackerman, Andrew
Top U.S. banking regulators on July 20 said they would work jointly to modernize rules governing how banks lend hundreds of billions of dollars annually in lower-income communities. Officials also said they would move to scrap a Trump-era overhaul of the rules that had divided regulators and industry officials. The Office of the Comptroller of the Currency (OCC), which oversees national banks and the bulk of the activity under the low-income lending rules, said it would propose withdrawing controversial changes it pushed through last year without the support of the Federal Reserve and the Federal Deposit Insurance Corp., two other bank regulators responsible for overseeing the Community Reinvestment Act (CRA). The revamp comes at a time when the Biden administration has pledged to do more to address disparities in wealth, incomes and access to financial services among Blacks and other racial groups. In a separate statement, all three regulators said they plan to jointly modernize the rules in question. A formal joint proposal isn’t expected for several more months, likely not until 2022. The OCC’s 2020 revisions aimed to spread online banks’ lending out nationally. They added areas where banks draw large amounts of deposits even if they have no branches there. They would also provide clarity on the types of loans and investments that are required. The Fed declined to support the comptroller’s plan last year, with Federal Reserve Governor Lael Brainard suggesting it was rushed to completion and could inadvertently decrease lending to lower-income areas. Brainard is leading the Fed’s work on the issue.
State and Local Activities
Iowa Targets $100 Million in COVID-19 Relief Funding to Address State Housing Shortage
Des Moines Register (09/08/21) Norvell, Kim
Iowa Gov. Kim Reynolds said Sept. 8 that the state is allocating $100 million of its federal COVID-19 relief funding toward addressing its housing shortage. She said the American Rescue Plan Act funding, in addition to the $230 million the Iowa Legislature allocated over five years to the state's tax credit programs, will make it possible for developers to build 36,450 new housing units. Reynolds unveiled the plan at the Iowa Finance Authority's annual housing conference in Cedar Rapids. From the new proposal, $45 million is slated to go toward Iowa’s federal Low-Income Housing Tax Credit (LIHTC) program. The Iowa Finance Authority, which administers the program, will prioritize developers denied funding in the 2020 and 2021 tax credit rounds, says Dave Vaske, the agency's LIHTC manager. He called the additional funding a "grand slam," asserting, "We feel (it) could be enough to do 12 to 15 projects, depending on the financial needs. We're very excited about that — it's like having another round of tax credits for us." A recent Iowa Finance Authority study found the state needs 47,000 new homes in the next decade to accommodate population growth. Nearly 40 percent of those units need to have rents or mortgages that are affordable to Iowans earning 80 percent or less of the area median income, which in Iowa is a maximum of $47,964 a year. Meanwhile, the finance authority's study found 39 percent of renters and 16 percent of homeowners are "cost burdened," meaning they spend more than 30 percent of their income on housing expenses, including utilities.
Green Building
Granholm Announces New Building Energy Codes
The Hill (07/21/21) Budryk, Zack
U.S. Energy Secretary Jennifer Granholm in July announced a series of new building energy code determinations that the Energy Department expects to save $138 billion over 30 years. The savings estimates include up to 4.7 percent of on-site energy, 4.3 percent of source energy, 4.2 percent carbon emissions, and 4.3 percent in energy costs. The determinations should yield savings of $138 billion over the next three years for homes and businesses, or about $162 per residential unit annually. By building type, projected savings include 4.7 percent for commercial buildings and 9.4 percent for residential buildings compared to earlier model energy codes. The updated codes would strip 900 million metric tons from carbon emissions. An accompanying energy savings listed high-efficiency lighting, increased wall and ceiling insulation, and improved efficacy for mechanical ventilation fans among the changes necessary for realizing these savings. "Based on these results, the 2021 [International Energy Conservation Code] is expected to improve energy efficiency in residential buildings by almost 10 percent," the analysis reads.
How Air Barriers Help Boost Energy Efficiency
Professional Builder (07/15/21) Mansouri, Bijan
Bijan Mansouri at TYPAR Construction Products writes that building wraps can reduce drafts, boost occupant comfort, and lower energy consumption by decreasing the amount of non-conditioned air entering and leaving conditioned wall cavities. The Department of Energy and Energy Star estimate that continuous air barriers like building wraps could cut energy costs by up to 15 percent to 20 percent. Critical to this is ensuring the air barriers' durability and proper installation, and Mansouri says building wraps' performance can be upgraded by 20 percent by sealing all laps and penetrations with the proper tape. "Horizontal laps are just as important as vertical laps because windblown rain can travel sideways or even up and over an improperly installed lap," he notes. "Any tears and holes should be sealed with manufacturer-recommended tapes, and all windows and doors should be properly flashed." Mansouri adds that following the proper nailing pattern is just as critical during installation to guarantee the material is kept against the wall and not blown off. "Galvanized roofing nails or plastic cap nails should be used to attach the air-barrier material to the structural sheathing and framing," he recommends. "Uncapped nails, staples, or screws...must not be overlooked." Mansouri concludes that the system's holistic efficacy can be ensured in the least complicated way by specifying wrap, tapes, and flashing from a single manufacturer.
Association News
NAHMA Announces October 2021 Meeting Reverts to Virtual
NAHMA is moving its October 2021 Biannual Top Issues in Affordable Housing conference to an online platform. Due to the ever-changing situation resulting from the ongoing pandemic, the NAHMA Board of Directors voted on Sept. 13 to cancel the previously announced in-person meeting in favor of transitioning to a virtual gathering instead. When the board initially decided to go ahead with the in-person meeting in July, COVID-19 infection rates were trending significantly downward. With the emergence of coronavirus variants and increasing numbers of infections nationally, the board has decided to hold a virtual meeting out of an abundance of caution for NAHMA members and invited guests.
The multiday event will take place from Oct. 19-22 and will focus on virtual panels concentrating on the top issues facing affordable housing and educational sessions on topics for today’s world. More details on the virtual meeting will be available in the coming days.
NAHMA will contact everyone currently registered for the in-person meeting about converting their registration to the virtual event. Anyone who has made a hotel reservation should contact the hotel directly to cancel.
For more information, click the Web Link below.
NAHMA Drug-Free Kids Calendars on Sale
It may not be pumpkin spice flavored, but our favorite fall tradition is that the 2022 NAHMA Drug-Free Kids Calendar is now on sale. Be one of the first to own this collector’s item by downloading the order form and sending it in today. The calendars will begin shipping in late September. The calendar cost is $5.50 each, which is a Department of Housing and Urban Development and U.S. Department of Agriculture allowable project expense.
Purchase calendars before Nov. 12, and you are automatically entered in the lucky draw for prizes, including NAHMA meeting registrations, books, and gift cards. There is a small shipping and handling fee for each calendar.
The calendars feature outstanding original artwork by children, seniors, and adults with special needs living in affordable multifamily housing. The underlying message for the annual calendar contest is always a drug-free theme. Still, the association wanted to open the door for more avenues of expression, so a subtheme is incorporated into the poster contest. The subtheme this year is With Responsibility Comes Reward: Holding Ourselves Accountable.
To download an order form, click the Web Link provided.
Time to Start Your COQ Award Application
The submission deadline for entries to NAHMA’s 2021 Communities of Quality Awards program is Nov. 4, 2021. The Communities of Quality (COQ) Awards recognize outstanding property management companies providing the highest quality of safe, affordable multifamily rental housing in communities across the country.
To enter the 2021 COQ Awards competition, a property must first apply for and achieve National Recognition as a NAHMA Community of Quality with a minimum score of 325 points on its National Recognition Application. The deadline for submitting a National COQ Recognition Program application to a local AHMA for consideration in this year’s COQ Awards cycle is Sept. 2, 2021.
The AHMAs will be honoring their local NAHMA Communities of Quality program participants. Please check with your local AHMA for its program details. A directory of the AHMAs is available at http://www.nahma.org/membership/ahma-directory.
For more details about the COQ Awards, click on the Web Link provided.
NAHMA Releases 2021 Affordable 100 List
The National Affordable Housing Management Association (NAHMA) announces its 2021 Affordable 100—a list of the 100 largest affordable multifamily property management companies ranked by affordable unit counts—is available on its website, click Web Link below, as well as in the June issue of NAHMA News. The NAHMA website version expands the list to the top 120 largest multifamily property management companies. In addition, the online version presents two specialty lists: the 25 largest housing credit (LIHTC) property management companies and the 25 largest Rural Development program property management companies.
Become a Specialist in Housing Credit Management® (SHCM®) Company!
The two national associations sponsoring the Specialist in Housing Credit Management® (SHCM®) certification program invite your company to become a Specialist in Housing Credit Management® Company, a corporate designation created specifically to honor management companies that successfully maintain a significant portion of their properties and staff to the high standards of the SHCM certification program.
The SHCM program, developed especially for management companies involved with properties developed and operated under the Low-Income Tax Credit (LIHTC) program, is sponsored by the National Affordable Housing Management Association (NAHMA) and the National Apartment Association Education Institute (NAAEI).
Earning the SHCM Company designation publicly demonstrates that a company is among the finest managers of LIHTC housing in the industry.
For more details on how to become a SHCM Company, click on the Web Link below.
Upcoming Events
NAHMA Biannual Top Issues in Affordable Housing Virtual Fall Conference
October 19-22, 2021
More
NAA Assembly of Delegates
November 2-4, 2021
More
NAA Digital
December 7-9, 2021
More
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