U.S. House and Senate leaders have come to an agreement on a spending bill that contains a major win for the U.S. Department of Housing and Urban Development (HUD): expansion of  HUD’s Rental Assistance Demonstration (RAD) program to allow for conversion of up to 185,000 units of public housing. The proposed Consolidated and Further Continuing Appropriations Act of 2015 (CR-Omnibus) would also extend the demonstration period through 2018.

By growing RAD from the current 60,000-unit cutoff, this legislation provides for conversion of all properties on the RAD waiting list. With limited redevelopment options available to public housing authorities (PHAs), and a substantial public housing capital improvements backlog, the RAD provisions in the CR-Omnibus bill will open another avenue for some housing authorities to leverage capital for needed improvements.

Overall, however, HUD program funding would be cut by $90 million, which is far less severe than the original proposal passed by the House. The T-HUD division of the bill limits PHA director salaries and defunds the Physical Needs Assessments initiative. In addition, HUD’s Choice Neighborhoods Initiative, Home Investments Partnerships (HOME) program, and Community Development Block Grants (CDBG) are all on the chopping block in the CR-Omnibus bill, with allocations lower than fiscal year 2014 enacted levels. As reported in the House's official summary of the bill:

  • The agreement provides $80 million for the Choice Neighborhoods Initiative. The agreement includes language requiring that at least $50 million be made available to PHAs and provides up to $5 million to assist communities in developing strategies for implementing the program with community notice and input.
  • The agreement provides $900 million to remain available until September 30, 2018, for the HOME program.
  • The agreement provides $3.066 billion for the Community Development Fund, to remain available until September 30, 2017. Of the total, the agreement provides $3 billion in formula funding and $66 million for Indian tribes, including $6 million for grants for mold remediation and prevention.

The House of Representatives’ vote on the bill, confirming these measures, is expected today. Senate approval is likely to follow shortly thereafter. For more news and insights on the latest developments of the RAD program, be sure to review Ballard Spahr's webinars and legal alerts or the Housing Plus archive.

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