[StBernard] House Financial Services Committee Passes Measure to Preserve Affordable Rental Housing

[Westley Annis]

House Financial Services Committee Passes Measure to Preserve Affordable
Rental Housing

Effort strengthens rental housing in America

 

Washington, DC - House Financial Services Committee yesterday approved H.R.
4868, the Housing Preservation and Tenant Protection Act of 2010,
comprehensive affordable housing legislation introduced by Chairman Frank
that helps to stem the loss of affordable rental housing units across the
country and prevent the displacement of low-income tenants, many of who are
elderly or disabled.

 

Since the 1950s, HUD has subsidized about 1.7 million rental units in over
23,000 privately-owned, multi-family properties that are typically
affordable to low-income tenants.  Many of these units are over forty years
old and in need of recapitalization.  A 2004 Government Accountability
Office (GAO) report found that over 193,000 subsidized units were projected
to become market rate housing in the next 10 years when the HUD-subsidized
mortgage matures and the mortgage subsidy and low-income affordability
restrictions attached to the property terminate.  GAO estimated that
approximately 200,000 individuals in over 101,000 units with no other
subsidy attached to the property would be at risk of paying higher rents
because there were no existing tenant protections such as enhanced vouchers
to protect the tenants from paying higher rents or being evicted when the
mortgage matures.  The bill addresses the issues outlined in the GAO report
and a host of other issues related to protecting the significant investment
made by the federal government in helping construct and maintain housing for
low and moderate income tenants, many of whom are elderly or disabled, by
doing the following:

 

KEY PROVISIONS FROM THE HOUSING PRESERVATION AND TENANT PROTECTION ACT OF
2010

*	Provide resources and incentives to prevent the further loss of
affordable housing units 
*	Provides grants and loans to for-profit and non-profit housing
sponsors to help ensure the property is recapitalized and kept affordable. 
*	Establishes a voluntary Preservation Exchange Program to encourage
owners to sell properties to purchasers who will keep the housing
affordable. 
*	Establishes a first right of refusal that provides state housing
agencies with an opportunity to purchase a property from an owner who wishes
to sell their property.  Significantly, the bill does not require an owner
to sell their property or prevent them from obtaining fair market value. 
*	Allows owners to request project-based assistance in lieu of
enhanced vouchers, which serves to help preserve the long-term affordability
of the project, assist with capital for rehabilitation, and ensure that
tenants are not displaced. 
*	Allows owners to receive budget based rent increases, thus ensuring
that the properties are adequately maintained and encouraging owners to
renew Section 8 contracts. 

 

Prevents the Displacement of Disabled, Elderly and Other Low-Income Tenants 

*	Closes gaps in existing law to ensure that all low and
moderate-income tenants are eligible for enhanced vouchers in the event that
the assisted housing is converted to market rate housing. 

 

Elderly Housing

*	Gives HUD and affordable housing providers the tools needed to
recapitalize the aging Section 202 elderly housing portfolio. 
*	Enables tenants to be partners with HUD, RHS, and owners to ensure
that federally-assisted housing is properly maintained. 
*	Includes notification requirements to ensure that tenants are given
sufficient notice prior to the conversion of the property to market rate
housing. 

 

Rural Housing 

*	Makes permanent a rural housing revitalization demonstration program
launched in Fiscal Year 2006 that is designed to preserve and recapitalize
Section 515 properties. 
*	Authorizes vouchers for tenants in properties that are converted to
market rate housing or foreclosed. 
*	Extends the same protections afforded to tenants in HUD-assisted
housing to tenants in RHS-assisted multifamily properties. 

 

Establish a National Database to Further Preservation 

*	Directs HUD to establish a nationwide public database of HUD- and
RHS-assisted properties to enable policymakers and the public to more
effectively monitor and preserve the existing portfolio of affordable
housing. Requires the database to contain adequate safeguards to ensure the
protection of owners' privacy rights and proprietary information. 

 

 

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