CARH'S BROADCAST EMAIL - Legislative Update
CARH Broadcast Email—Legislative Update
December 29, 2020
Emergency Coronavirus Legislation and Omnibus Appropriations Bill Signed into Law
On Sunday, December 27th, President Trump signed into the law H.R. 133, the $1.4 trillion Emergency Coronavirus Legislation and Omnibus Appropriations bill. As was reported in CARH's Broadcast Email of December 21, 2020, the bill will provide roughly $900 billion in coronavirus relief aid, plus funding for all of the federal government agencies through Fiscal Year (FY) 2021, as well as numerous tax provisions, including a permanent minimum 4% Housing Credit rate for bond financed properties, generally. The minimum 4% Housing Credit rate would be effective for buildings placed in service after December 31, 2020, and that any portion of which is financed with Housing Bonds under Section 42(h)(4)(A) of the Internal Revenue Code, and the bonds financing the building are issued after December 31, 2020. This permanent 4% rate is a major victory for affordable housing industry, of which CARH has supported for many years. CARH has worked tirelessly with other groups, and as a member of the ACTION Coalition steering committee.
Holland and Knight, CARH's outside legislative team, produced a summary of the legislation outlining many of the provisions in the coronavirus section. Funding for the Department of Agriculture's Rural Development (RD) housing programs, as well as the Department of Housing and Urban Development (HUD) programs, will be funded at or above FY 2020 levels. The funding charts linked next provide an outline of the FY 2021 funding levels for both RD and HUD. (Click here for the RD chart and click here for the HUD chart.)
For RD, the Omnibus provides a stable $1.410 billion for Section 521 Rental Assistance (RA); $230 million in budget authority for Section 538 guaranteed loans; $40 million for Section 515 ($6.68 million for new construction); $40 million for rural vouchers; and $28 million for the Multifamily Preservation and Revitalization (MPR) demonstration program.
The law also continues from the FY 2020 Appropriations bill, that at the request of an owner, for the Secretary of Agriculture to renew the Section 521 RA agreement up to 20 years or until the term of the Section 515 or Section 514 loan. Previously, the terms of RA contracts have been for only one year. CARH has advocated for many years for RA contracts to be 20 years. CARH continues to advocate for permanent authorizing language for the 20 year contracts. H.R. 3620, Rural Housing Preservation Act of 2019, had been previously passed by the House and would have allowed 20 year contracts RA contracts in certain preservation transactions as well. The Senate Banking Committee has not proceeded with the bill in this Congress. The current Congress is ending and so H.R. 3620 will need to be reintroduced in the 117th Congress. Passage of legislation with this permanent change is a CARH priority.
As for HUD programs perhaps most important to CARH members, the law provides $1.35 billion for the HOME Investment Partnership program; $3.47 billion for the Community Development Block Grant program; $13.465 billion for project-based Section 8; and $25.7 billion for housing vouchers.
Finally, as we reported in our December 21 Broadcast Email, there is $25 billion for rental subsidy that will run through the Treasury Department in large block grants to state and localities under the Coronavirus Relief Fund (CRF). Rural residents and properties are eligible to apply for these funds. Currently 34 states have some type of rental assistance program that was established through the CARES ACT. The remainder of states will need to establish a program. Funds will run through the end of 2021. The Treasury Department’s CRF page with amounts by state and related guidance can be found here. The National Council of State Housing Agencies (NCSHA) has a created a directory by state but we expect states to make changes in light of the new law and lessons learned under the prior CARES Act allocation.
It is important that CARH members familiarize yourselves with program in your individual states and apply accordingly. CARH, together with other affordable housing groups, are working with President-Elect Biden's transition team on guidance and to ensure that rural is considered by the states when funds are allocated.
During this continuing crisis CARH staff, executive committee, board members, and members will continue to work with stakeholders, federal agencies, and lawmakers to find the best ways to support all rural communities. Join industry insiders at CARH’s virtual Midyear Meeting January 25-26, 2021, where sessions addressing how this massive legislative package will impact owners, residents, and properties throughout rural America will be discussed. Click here to register now.