Housing Alliance Wins More Than $26 Million in New Money for Housing

Despite Defeat of HB3551, 2007 is the Best Session for Housing in Oregon History

Despite great grass roots support and a well executed in-building strategy, HB 3551 died on the House floor this week.  As you all read from the updates, we had been feeling pretty confident over the past month that we would win the document recording fee. Our lobbying team had secured support for the bill from 10-12 Republican representatives and were feeling optimistic that we would get the 36 votes we needed.  This week the Republican caucus locked up and HB 3551 fell three votes shy of passage in the House. Rep. Chuck Burley and Rep. Patti Smith voted for passage, along with all of the Democratic Reps.

We always knew that the timing of the consideration of 3551 would play a huge role in its chances for success. Unfortunately, we encountered several delays that hurt us.  First, Legislative Counsel ruled the document recording fee to be a tax in April, even though they had decided it was a fee last fall.  Then our bill got caught up a little longer than anticipated in the Transportation Subcommittee of Ways and Means.  These delays and the typical end-of-session resentments between the two parties were sufficient to unhinge our effort.

We have a lot of supporters in both parties.  We worked hard during the interim to make our proposal be a bipartisan, rural and urban issue.  We need to continue to do that after this session and to educate the new Republican leadership. We are only a few votes away from success and we aren’t stopping!

What an amazing job we did this session!  We broadened our coalition and developed a strong working relationship with Oregon Housing and Community Services that got us farther than we could have alone.  Key to our success was inclusion of $26 million in new funds in the Governor’s proposed budget released in January. These partnerships made a real difference for those working families, veterans, people with disabilities and seniors. Despite the defeat of the document recording fee we had the largest commitment of new housing funds in our states’ history!

√     SB 5517, the Oregon Housing and Community Services budget, passed Monday June 25, renewing existing funds and adding $26 million in new resources to housing for working families, seniors, veterans and people with disabilities.  Approximately $16 million in Lottery backed bonds will be committed to developing new affordable housing and for funding services for people coming out of homelessness. $8 million in new General Funds will be used for the preservation of affordable housing around the state in jeopardy of being lost to the private market, with a priority on housing with existing rent subsidy contracts. $2 million of General Fund will restore money taken from the Housing Trust Fund in earlier sessions.

√     We secured another $2 million for the Oregon Affordable Housing Tax Credit with HB 3201B, one of the state’s best tools to create affordability for people at or below 30% median family income. In the 2005 Legislative session the Housing Alliance’s big win was a $2 million cap expansion, and WE DID IT AGAIN!  Furthermore, we expanded the uses of this tax credit to help preserve existing affordable housing and save manufactured home parks! Click here to view HB 3201B. The amendments we added are in Section 61.

√     We passed a Condo Conversion bill (HB 3186) that protects renter’s rights to a full 120-day notice to relocate, minimizing the negative impact people feel when they lose their home to condo conversion.

√     Two MH park bills also passed this session.  HB 2096A creates the new Manufactured Dwelling Park Nonprofit Cooperative Corporation.  HB 2735C, the MH park closure bill, requires closing park landlords to pay $5/7/9k to displaced tenants, and continues and expands eligibility for the state tax credit (although HB 3201B reduces the credit from $10k to $5k).  It also continues the capital gains break for landlords who sell to residents, nonprofits, or Public Housing Authorities and allows OHCS to use the existing tenant space fee to subcontract out for a housing counselor to help the displaced tenants, among other things.

√     HB 3485C, which makes clear that we can use deed restrictions and affordability covenants to ensure long term affordability

√     We made progress on inclusionary zoning.  The bill did not pass out of committee but we started having constructive conversations with the homebuilders that will continue into the interim.  Additionally, a provision in HB 2096A directs the Department of Land Conservation and Development to report to the 2009 legislature on the use of Inclusionary Zoning to promote new MH parks.

We should all be so proud!  All your calls, emails and advocacy efforts made these victories possible.  Thank you so much.

No, it’s not enough, but we’re building steam! As for what’s next, there will likely be a special session in 2008, and you can believe the Housing Alliance will be back with a package to secure more of the funding we need for housing in Oregon.  Whether it is a revamped doc fee or another avenue to dedicate ongoing funding to housing, we will need you to rally us once again to victory.

We will hold a membership meeting in August to debrief this session and start planning our strategy for the next one! We will send out a meeting date to all members soon.

Remember: The Housing Alliance goal was to win $100 Million for housing in ten years.  This is year 3, and we have the state’s funding commitment up to about $37 million (new and existing direct expenditures) for this biennium.  We still have a ways to go to reach our goal, but we sure have already come a long way!

Together we win!

The Housing Alliance brings together advocates, local governments, housing authorities, community development corporations, environmentalists, service providers, business interests and all others dedicated to increasing the resources available to meet our housing needs to support a common statewide legislative and policy agenda. To find out more about the Housing Alliance, go to: http://www.oregonhousingalliance.org/

Prevailing Wage Bill Passes, Re-Establishing Clarity, Predictability for Housing

HB 2140, the legislation which provides clarity on when prevailing wages apply to affordable housing projects, passed both the House and Senate and is waiting for the Governor’s signature.   HB 2140 address prevailing wage application to private projects using public funding, including affordable housing projects.

Though the elements that address affordable housing development are only one element of HB 2140, the bill’s passage brings welcome clarity and predictability on the application of prevailing wage. During the 2006 legislative interim, AOCDO and CDN worked with the Oregon Building Trades Council and the Pacific Northwest Regional Council of Carpenters to reach an agreement that would both meet the needs of the unions seeking wage and benefit assurances, and the non profit developer of providing needed housing with limited resources.

The crux of the affordable housing portion of the legislation establishes building height and affordability limits are the primary criteria to determine if a housing project prevails.  Buildings of four stories or less (five stories or less in Portland) are exempted if 60% or more of the rentable space houses families at or below 60% median family income, or in an ownership situation if 60% or more of the space is sold to households earning under 80% median family income.

CDN and AOCDO will provide more specific information on the application of the new law in the next few weeks.  Questions?  Call Michael at (503) 335-9884.

National Affordable Housing Trust Fund Introduced Today

The National Affordable Housing Trust Fund Act of 2007 was be introduced in the U.S House of Representatives today, June 28^th by House Financial Services Committee Chairman Barney Frank (D-MA) and several bipartisan cosponsors. This is a significant moment for the National Housing Trust Fund Campaign. In the new policy and political environment in Washington this year, we can expect to take this bill further than similar bills in previous Congresses.

Legislation earlier this year (Federal Housing Financial Reform Act of 2007 and the FHA Expanding Homeownership Act of 2007) have secured sources of dedicated funding, pushing the overall trust fund bill closer to actualization.

The campaign to establish a National Affordable Housing Trust Fund needs your attention and advocacy now more than ever. There is a one page summary and press tool kit on our website to help you effectively disseminate information to the press in your local areas.

More information about the NHTF Campaign can be found here: www.nhtf.org.

Congress Holds Hearings on HOPE VI, Homeless Programs Bill

The reauthorization of the HOPE VI public housing program, which sunsets September 30, 2007, was the subject of two hearings on Capitol Hill this week. On June 20, the Subcommittee on Housing, Transportation, and Community Development of the Senate Banking, Housing, and Urban Affairs Committee held a hearing on S. 829, a bill to reauthorize HOPE VI introduced by Senator Barbara Mikulski (D-MD). On June 21, the Subcommittee on Housing and Community Opportunity of the House Financial Services held its own hearing on the HOPE VI program. 

Testifying before the Senate subcommittee, Senator Mikulski said that S. 829 represents a modern HOPE VI program and that it “codifies HOPE VI best practices and corrects issues we have identified as problems.” Senator Mikulski’s bill would encourage connections between HOPE VI grant applicants and their local school systems, a major change for the HOPE VI program. “School systems attract the middle class,” Senator Mikulski said in reference to the bill’s goal of replacing high poverty neighborhoods with mixed income communities. 

Senators Charles Schumer (D-NY), chair of the subcommittee, Jack Reed (D-RI) and Elizabeth Dole (R-NC) praised the HOPE VI program and the bill. Senator Mike Crapo (R-ID), ranking member of the subcommittee, said the subcommittee has important goals for strong public housing and that there are improvements that can be made to HOPE VI. Senator Crapo said he wants to learn about those improvements and move forward aggressively. 

HUD Assistant Secretary for Public and Indian Housing Orlando Cabrera said that the Administration opposes reauthorization of the HOPE VI program but that, if it is to be reauthorized, its success would depend on more flexibility within the program. Mr. Cabrera, possibly in reference to S. 829’s school system connections, said, “Anything outside of housing increases the complexity” of the program. “HOPE VI is about bricks and mortar,” he said. “The more you move away from just bricks and mortar, the delays come.”

Senator Robert Menendez (D-NJ) questioned Mr. Cabrera’s written statement that requiring a one-for-one replacement of units would add 33% to the program’s cost. If that is the case, asked Senator Menendez, had HUD requested additional funding? Mr. Cabrera, as he would do the next day in the House hearing, said instead of requiring one-for-one replacement of public housing, it would be much easier to envision a one-for-one replacement of “affordable housing.” This is housing that can be built with low income housing tax credits, bonds or even HOME funds and the units would be affordable to people from 0 to 60% of area median income, Mr. Cabrera said.

Senator Menendez told Mr. Cabrera that his state of New Jersey struggles with a lack of low income housing and called Mr. Cabrera to task for HUD’s FY08 funding request of only 17% of what was enacted in FY07 for public housing. Senator Menendez said that flexibility does not help very much when public housing agencies (PHAs) do not have enough money. Mr. Cabrera said that no additional funds were needed.

Richard Baron, representing McCormack, Baron and Salazar, a developer of 19 HOPE VI projects, testified that HOPE VI has brought in local philanthropic funding and, beyond the redevelopment of the public housing sites, has stabilized cities and increased homeownership. Mr. Baron said that the complexities of the program have not been particularly difficult for his company.  Mr. Baron also testified that if there are management issues with local PHAs, sanctioning these agencies is appropriate. He urged the subcommittee not to fault the program as a whole because of a few bad grant managers.

Sue Popkin testified representing The Urban Institute. Dr. Popkin’s research, which is the national study of outcomes of the HOPE VI program, has found that, “for the most part, former residents are living in neighborhoods that are dramatically safer and offer a far healthier environment for themselves and their children.” This research has tracked residents at five sites.

Florida Legal Services attorney Chuck Elsesser, an NLIHC board member, represented NLIHC at the Senate hearing. Mr. Elsesser described Miami’s experiences with HOPE VI, including the planned replacement of only 80 of the 850 demolished Scott Homes and Carver Homes public housing units. Most residents initially received vouchers to relocate, but after three years at least 600 residents were no longer receiving any housing assistance. Mr. Elsesser described how community groups have searched for the past 10 months for these missing families and found that many, if not most, have been rendered homeless. Many were living doubled up, sleeping on friends’ or relatives’ floors, while others were in shelters.

Mr. Elsesser discussed inherent problems with the HOPE VI program, such as lack of one-for-one replacement of public housing units, no universal right to return for residents, and insufficient emphasis on relocation of current residents and hard-to-house residents.

Senator Crapo quoted a 2007 case study by Michael Brazley and John Gilderbloom of the Park DuValle Revitalization Project in Louisville, KY, published in the American Journal of Economics and Sociology. The study that found that HOPE VI helps non-public housing residents more than it does public housing residents, for whom it enhances the lives of only a small number. The major question of who benefits, Mr. Elsesser said, is the thrust of one-for-one replacement, right to return and paying attention to the hard-to-house. NLIHC’s analysis is that S. 829 fails to address these three major shortcomings of the HOPE VI program.

The hearing held by House Financial Services Subcommittee on Housing and Community Opportunity Chair Maxine Waters (D-CA) had a distinctly different tone – one that, while in support of the overall vision of the HOPE VI program, was much more skeptical of the benefits HOPE VI has brought to public housing residents. Ms. Waters said that she supports one-for-one replacement and that HOPE VI should be reauthorized at a level that allows for one-for-one replacement of public housing units. She said that the subcommittee has no intention of resegregating or increasing the isolation of public housing residents with the HOPE VI program. She also said she believes in residents’ right to return to public housing and does not support additional rescreening of returning residents.

House Financial Services Committee Chair Barney Frank (D-MA) said that the committee is determined to correct a long-standing mistake of the HOPE VI program: tearing down more housing for poor people than it rebuilt. Mr. Frank said that one-for-one had to be done with sophistication to avoid excessive concentration of public housing units.

House HOPE VI legislation is expected to be introduced soon, and Mr. Frank said the committee will be ready to vote on the bill in July. 

Representative Emmanuel Cleaver (D-MO) emphasized the importance of monitoring displaced public housing residents.  “We must make sure we know where people have gone and we do not lose track of them,” he said. “We must be able to say what happened to the people who moved.”  Replacement units, he said, ought to be dispersed all over a city with great intentionality.

Representatives from four public housing agencies testified in support of the HOPE VI program: the City of Los Angeles; Charlotte, NC; Stamford, CT; and the District of Columbia. Ms. Waters questioned them at length to determine whether they had implemented new re-occupancy requirements on their public housing residents and made it clear she opposed rescreening methods. “People need public housing because they have fallen on hard times, when they cannot pay their bills” and keep their credit up, she said.

Representative Mel Watt (D-NC) also spoke up in support of one-for-one replacement of public housing units and said some units should be rebuilt “on the other side of town whether they want it or not.” Mr. Watt said that the committee is working on how it defines one-for-one replacement and would also be looking at some consideration of vouchers in some circumstances “with very careful wording” and “in some extreme cases, a waiver for a public housing agency’s one-for-one replacement requirement.”

Yvonne Stratford, a leader of Low Income Families Fighting Together (LIFFT) in Miami, also testified before the subcommittee. Ms. Stratford was displaced from Scott Homes, the failed Miami HOPE VI site, and now lives in a different public housing development. Of the 850 units demolished, only a few have been rebuilt as homeownership homes. LIFFT has worked during the last year with other Miami advocates to find displaced Scott Homes and Carver Homes residents. They have found that many of the families relocated with vouchers quickly lost their vouchers and became homeless.  Ms. Stratford urged the subcommittee to support one-for-one replacement of public housing units and the development of new units before the old units are torn down. LIFFT and the Miami-Dade Housing Agency are now in agreement that all demolished units must be rebuilt for public housing residents and are working with HUD for approval of that agreement.

NLIHC Board Chair George Moses testified on behalf of NLIHC at the House hearing. Mr. Moses is also on the board of the Housing Alliance of Pennsylvania and is a member of the Southwestern Pennsylvania Alliance of HUD Tenants. Mr. Moses emphasized that what he has seen in his home town of Pittsburgh is being replicated across the nation because of shortcomings in the HOPE VI program, which he thanked the subcommittee for working to correct. These shortcomings include a lack of sufficient resident participation in all phases of HOPE VI planning and implementation, lack of one-for-one replacement of units, no rescreening of returning residents, and other program failures.

Doris Koo, president and chief executive officer of Enterprise Community Partners, described the good that Enterprise has experienced with the HOPE VI program. Ms. Koo said that residents must be full partners in the HOPE VI process and that the health of the families and the environmental quality of the property are linked. Ms. Koo encouraged HUD to implement energy saving programs in its public housing and spoke in support of “green” incentives to be added to the program in the future.

Hearing on Homeless Programs Bill in U.S. Senate

On June 21, the Senate Committee on Banking, Housing, and Urban Affairs held a hearing on S. 1518, the Community Partnership to End Homelessness Act of 2007, or CPEHA, which was introduced on May 24 by Senators Jack Reed (D-RI) and Wayne Allard (R-CO). CPEHA would reauthorize HUD homeless assistance programs in the McKinney-Vento Act. 

The witnesses were Roy Bernardi, Deputy Secretary, HUD; Adrian Fenty, Mayor, District of Columbia; Shirley Franklin, Mayor, Atlanta; Lloyd Pendleton, Director, Homeless Task Force, State of Utah Division of Housing and Community Development; Carol Gundlach, Executive Director, Alabama Coalition Against Domestic Violence; Moises Loza, Executive Director, Housing Assistance Council; Linda Glassman, Board Secretary, National AIDS Housing Coalition; and Nan Roman, President, National Alliance to End Homelessness.

Overall, members and witnesses expressed appreciation for the CPEHA approach to the reauthorization of the McKinney-Vento Act.  In particular, there was widespread agreement that the Prevention Title, which allows communities to assist households at risk of homelessness, and the creation of a separate, less cumbersome application process for rural areas, will be substantial improvements upon current practice. Additionally, there was praise for the provisions in the bill that encourage innovation and permanent housing outcomes through a “flexibility incentives” program. HUD’s definition of homelessness continues to be a bone of contention and the attempt in CPEHA to expand HUD’s definition of chronic homelessness does not address this concern to the satisfaction of all advocates.

As the lead sponsor of the bill, Senator Reed opened the hearing, highlighting its many positive facets and praising it as a means of ending long-term homelessness. Other opening remarks struck a similar tone, though Senator Richard Shelby (R-AL) was clear that HUD’s definition of homelessness is not well-matched with other federal departments. Members of the committee also noted the affordable housing crisis as a barrier to ending homelessness. Recognizing this, Senator Reed pointed out that the House Government Sponsored Enterprise (GSE) reform legislation contains an Affordable Housing Fund which should result in the availability of $500-800 million in funds to preserve, rehabilitate and construct affordable housing.

Mayors Fenty and Franklin praised the legislation for consolidating the McKinney programs, for the flexibility allowed and for targeting that allows mayors to leverage private funding.

Ms. Gundlach shared some major concerns including the extent of bonuses and targeting in the bill, limits on local priority-setting and HMIS privacy issues and the fact that the bill does not expand the HUD definition of homelessness. Additionally, Ms. Glassman asked that the committee consider expanding HUD’s definition of homelessness to include a modified version of doubled-up households.

On June 19, the Internal Revenue Service (IRS) proposed a new section [1.41-18] in the Low Income Housing Tax Credit (LIHTC) regulations [26 CFR part 1] intended to prescribe how to determine the price of LIHTC properties when they are sold at the end of the 15-year compliance period.

The law requires LIHTC units to be rent-restricted and occupied by income-eligible households for at least 15 years (called the compliance period), with an extended use period of at least another 15 years (30 years all together). Some states require extended low income housing commitments greater than 30 years or provide incentives for projects that voluntarily agree to longer commitments. Where states do not mandate longer restricted-use periods, during the 14^th year of the 15-year compliance period, an owner can submit a request to the Housing Finance Agency (HFA) to sell a project. The HFA has one year to find a buyer willing to maintain the rent restrictions for the balance of the 30-year period. If the property cannot be sold to such a “preservation purchaser” then the owner’s obligation to maintain rent-restricted units is removed and lower income tenants receive enhanced vouchers enabling them to remain in their units for three years. The IRS can recapture tax credits if a project fails to comply.

The IRS proposes to define for the first time how the purchase price of a project must be calculated at this stage. A LIHTC project can contain both low income units and market rate units. The non-low income housing portion must be sold at fair market value. The IRS says that because the intent the LIHTC program is to continue the low income units as rent-restricted for an extended period of time, the fair market value of the non-low income units must reflect the use restrictions of the low income portion of the project. In addition, the IRS proposes that the non-low income portion include the fair market value of the land underlying the entire project.

The IRS specifically requests comments regarding whether low income buildings are ever sold without the underlying land, and if so, how such cases should be treated. The IRS also asks how often the underlying land is leased, and how leased land should be treated.

To determine the appropriate purchase price of the low income portion of a LIHTC project, the proposed new regulation follows the statute, presenting a formula that amounts to the outstanding debt, adjusted investor equity, and other capital contributions, minus cash distributions, all multiplied by the “applicable fraction,” which is the ratio of the number of rent-restricted units divided by the total number of units. The proposed IRS rule defines outstanding debt and clarifies that debt from refinancing or additional mortgages in excess of qualifying building costs do not count. “Adjusted investor equity” is defined as only cash invested by owners used for qualifying building costs, adjusted by a cost of living factor not to exceed 5%. “Other capital contributions” are defined by the example of the cost of replacing a furnace. “Cash distributions” are defined by the examples of money distributed to owners from the proceeds of refinancing, or money in operating or replacement reserves made available at the time of sale.

The IRS asks for examples of forms of cash distribution that should or should not be included in the definition. The IRS also asks whether low income housing is owned by entities other than corporations and partnerships.

Comments are due September 17. In addition, a public hearing will be held in Washington, DC on October 15.

Click here for the proposed regulations are in the Federal Register (72 FR 33706).

Additional background information about the LIHTC program is available on page 130 of NLIHC’s 2007 Advocates’ Guide, available here.

Innovative Housing, Inc. invites you to the groundbreaking of 82^nd Avenue Place on July 2^nd at 3:30pm. This multi-family development will create 58 new units of affordable housing including 15 units for homeless families, a public child care center, community meeting space and a new playground open to neighbors. Location is the corner of NE 82^nd Avenue and Broadway Street (one block north of the 82^nd Avenue Max Station). Please wear footwear appropriate for uneven ground.

Mark Your Calendars: 19th Annual NAEHCY Conference in Portland Nov 10-13

The National Association for the Education of Homeless Children and Youth (NAEHCY) is hosting their annual conference in Portland this Fall at the Oregon Convention Center.  Mark your calendars for November 10-13, 2007.

The 2007 NAECHY conference is designed for district Homeless Education Liaisons, ESEA-Title IA administrators, homeless and runaway youth advocacy groups, housing administrators, state and county 10-Year Ending Homelessness Plan committee members, Continuums of Care, shelter and transitional housing providers, and others who work with migrant, immigrant, foster care and highly-mobile children and youth.   Planning for a Youth Forum is also underway, and the LeTendre College Scholarship Awards Banquet will be held for homeless and formerly-homeless students going on to college.

Oregon is the host state for the first time ever in the 19 year history of the National Association for the Education of Homeless Children and Youths.   This level of training has not been available in Oregon before on Subtitle IIV-B of the McKinney-Vento Act, also authorized as Title X of the No Child Left Behind Act.

This year’s conference, Blazing Trails and Moving Mountains: Educating All Our Children and Youth, will offer sessions on effective school and community responses to homelessness, including practice-based strategies for implementing the McKinney-Vento Homeless Assistance Act and related legislation.

Blazing Trails and Moving Mountains: Educating All Our Children and Youth is a unique showcase for best practices and services from across the country. It is the only national conference dedicated to improving the well-being of homeless children and youth. NAEHCY’s conference equips educators and advocates nation- wide with the knowledge, skills, information, and inspiration they need to remove barriers and help ensure that every child and youth experiencing homelessness is successful – academically, personally, and socially.

WHO SHOULD ATTEND?

* School Administrators

* Special Education Personnel

* School Counselors

* Title I Personnel

* Charter School Directors

* School District Homeless Liaisons

* State Coordinators of Homeless Education

* Homeless Service Providers

* Child Welfare Workers

* Teachers

* Social Workers

* Mental Health Providers

* School Nurses

* School Transportation Directors

* Head Start/Even Start Program Staff

* College and University Personnel from Social Work,

* Education, Psychology, and Nursing Programs

ISSUES TO BE ADDRESSED

* Best Interest Decision-Making for School Stability

* Prompt and Proper Placement

* Transportation Challenges and Successes

* Connecting Community and School Resources

* Developing a Comprehensive Homeless Education Program

* Academic Achievement

* Addressing the Early Education Needs of Young Children Without Homes

* Unaccompanied Youth: Understanding Legal, Educational, Social, and Emotional Issues

* Strategies for Assisting Children in Foster Care

* IDEA 2004 and Strategies for Implementation

* Parent Involvement: Research and Strategies

* Mental Health Needs of Homeless Children

* Disaster Response and Disaster Planning

* Data Collection and Program Evaluation

* Legislative and Policy Updates

* Research

Please note that there are individual rates now for each day, for convenience of those who cannot attend the entire conference.  Contact your state coordinator  Dona Bolt via email  for more information over the Summer. For more information, keep watching www.naehcy.org or call the NAEHCY Business Office at 866-862-2562.