At a time when rents are rising and families are struggling with housing, the Build Back Better proposal will provide significant resources to key federal housing programs, said Lopa Kolluri, a senior executive at the Department of Housing and Urban Development (HUD).
“The bill includes $24 billion to augment project-based rental assistance for privately owned rental housing,” said Kolluri during a keynote address at AHF Live. “It also includes funds to significantly increase the availability of new permanently affordable rental housing for people who are elderly and persons with disabilities.”
Under the plan, $1.6 billion will be allocated to HUD’s Section 202 program for elderly individuals and another $1 billion for the Section 811 program for very low-income persons with disabilities.
In addition, Build Back Better proposes $65 billion in public housing revitalization and a $10 billion historic investment in the HOME Investment Partnership program, which provides grants to states and localities to fund a range of affordable housing activities and a $15 billion investment in the Housing Trust Fund, said Kolluri, principal deputy assistant secretary of Office of Housing and the Federal Housing Administration (FHA) at HUD.
“As all of you are acutely aware, affordable housing development always requires multiple sources of public funding to make it work,” she said. “The Build Back Better expansion of the low-income housing tax credit (LIHTC) is one of the keys.”The latest House package of the bill calls for increasing the 9% LIHTC allocation cap by 10% plus inflation each year from 2022 to 2024 when it will have risen to $3.97 per capita or a small state minimum of about $4.58 million. In 2025, the housing credit volume cap would fall back to $2.65 per capita or a small state minimum of $3.12 million.
Among other key LIHTC provisions, the House manager’s amendment includes reducing the 50% bond financing test to 25% for five years.
Providing an update from HUD’s new administration, Kolluri said lenders in the audience will no longer need to print hundreds of pages of documents.
HUD recently issued formal guidance around the use of the Federal Housing Administration Catalyst: Multifamily Applications Module. Using this technology to electronically submit multifamily mortgage insurance applications means no more thumb drives, no more cloud links, or hard copy submissions starting Dec. 10, said Kolluri, who was the chief development and operating officer for the Philadelphia Housing Authority and has also worked at affordable housing firm Pennrose. Earlier, she served as deputy chief of staff to HUD secretary Shaun Donovan from 2011 to 2013.
“Under this administration, we are seeing meaningful actions, making historic investment to address the great housing challenges facing this nation,” she said. “With the challenge comes opportunity. I view working on these challenges with all of you as an opportunity to be part of real, sustainable solutions that will carry the nation forward in new ways.”
