New Affordable Housing Announcements from Treasury, White House
On March 5th, the U.S. Department of the Treasury announced new efforts to increase the supply of affordable housing and called on state and local governments to use their billions of dollars of remaining American Rescue Plan Act of 2021 (ARPA) funds to make investments that will improve housing supply.
Treasury has consistently encouraged state and local governments to use State and Local Fiscal Recovery Funds from the ARPA to support affordable housing, and about $18.5 billion of ARPA funds have been used for housing to date.
According to Treasury, the updated ARPA guidance will make it easier for recipients to use available recovery funds to boost housing supply by expanding the universe of eligible housing projects to include housing that will serve families with incomes of up to 120 percent of Area Median Income (AMI), up from the previous 80 percent guideline.
The announcement also included authority for unused state and local Emergency Rental Assistance program funds, which must be obligated by the end of 2024, for pre-development and acquisition of affordable housing. Treasury further relayed that it is working with federal and state regulators on addressing rising insurance costs, including for multifamily owners. LeadingAge welcomes the announcement, which can be found here.
Additionally, speaking in front of both chambers of Congress and millions of Americans at home, President Biden, in his March 7th State of the Union Address, committed to new efforts to bring housing costs down while increasing supply, but fell short of highlighting the need for more affordable senior housing.
The President’s affordable housing commitments echo recent White House announcements. In a factsheet released just ahead of the State of the Union, the President announced a plan to improve housing affordability, including by increasing housing supply, reducing home-buying fees, and expanding Housing Choice Vouchers. The factsheet outlines a proposal to expand the Low-Income Housing Tax Credit to build or preserve 1.2 million more affordable rental units, establish a new $20 billion competitive grant fund to support the construction of affordable multifamily rental units, and incentivize local actions to remove barriers to housing development.
On March 11th, the White House reiterated many of these goals in its Fiscal Year (FY) 2025 budget request, which includes relatively flat funding for the U.S. Department of Housing and Urban Development (HUD) but advances a number of bold initiatives for housing affordability and access, including for older adults. Like in FY 2024, the President proposes guaranteed Housing Choice Vouchers for certain populations and is seeking the first new project-based rental assistance contracts in decades, designed to serve extremely low-income households.
Newly this year, the President is proposing to establish a $20 billion “innovation fund” that would help invest in new multifamily housing development, as well as a new tax credit for first-time homebuyers and grants to help local efforts on eviction prevention. The proposal also renews existing project-based Section 8 and Section 202 Supportive Housing for the Elderly contracts, seeks renewal funding for Service Coordinators, and requests supplemental funding to preserve Section 202 units undergoing conversion through the Rental Assistance Demonstration (RAD). Missing from the proposal is any significant new investment in Section 202 or Service Coordination.
In the coming days, LeadingAge staff will more deeply assess the request’s proposals.
Contact: Annalyse Komoroske Denio, akomoroskedenio@leadingageny.org, 518-867-8866