The Department of Housing and Urban Development (HUD) is proposing a set of new rules for the embattled HOME program.

HUD’s proposal would:

  • Require state and local governments to adopt policies and procedures to improve their oversight of projects, develop a system for assessing the relative risk of projects, and more closely monitor their HOME-funded sub-recipients;
  • Require state and local governments to assess a developer’s capacity and the long-term viability of the project, before they commit HOME funds to a project;
  • Require more frequent reporting by state and local “participating jurisdictions” to enable HUD to more closely track projects once they’re under way; and
  • Set a higher “performance bar” by establishing specific timeframes for taking appropriate corrective actions against participating jurisdictions who fail to complete what they started.

“The HOME program is a success story for housing low-income Americans and creating jobs,” said HUD Secretary Shaun Donovan in a statement. “However, there’s more we can do to boost the program’s performance and accountability. Through these new steps, we want to expand HOME’s impact and ensure that every dollar is used smartly to help families afford their homes. Since we took office, we have been committed to strengthening the HOME program and ensuring that it creates affordable housing in an efficient and accountable way.”
The move comes at a time when the HOME program, the largest federal block grant to state and local governments designed to produce affordable housing, is under intense scrutiny following recent reports in The Washington Post that HUD failed to track the progress of housing projects and that nearly 700 developments awarded $400 million in HUD funds are stalled or delayed. The reports have led to congressional reviews of the HOME program.

HUD officials have refuted the Post’s findings. They say the 20-year program has successfully assisted in building 1 million affordable homes and is needed more than ever as the economy struggles.

HUD said it is also in the process of improving its Integrated Disbursement and Information System (IDIS), the primary data collection and reporting mechanism for tracking the commitment of HOME funds as well as the actual expenditure of these resources on a project-by-project basis. HUD is making significant changes to IDIS to improve grant management, reduce risk, and address troubled projects.