March 18, 2020

Congress Must Include Affordable Housing and Community Development Measures in COVID-19 Response Legislation

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As the coronavirus continues to profoundly impact the health and wellbeing of millions of Americans, along with their housing and economic stability, Enterprise encourages bold federal action to protect the most vulnerable members of our society.  

In order to ensure low-income renters, families struggling with mortgage payments, people experiencing homelessness, landlords managing affordable housing facilities, and non-profits serving vulnerable communities have the support they need to weather these challenging times, Enterprise recommends Congress and the Administration take these actions:

Rental Assistance and Landlord Protections 

Renters must be protected during this critical time of economic vulnerability, and the federal government must take proactive steps to ensure that low-income renters can stay in their homes. Just as important is that affordable housing providers—who already operate on thin margins under the best economic circumstances—do not see a dramatic decline in their revenues that threaten their own solvency. Enterprise is suggesting federal funding directed at both renters and housing providers, designed to keep all parties afloat until economic circumstances return to normal:

  • $20 billion for supplemental HOME grants, which can be used for temporary project-based and tenant-based rental assistance, including for people experiencing homelessness. It is also important that HUD receive broad waiver authority so that HOME can be used for services associated with increased cleaning, food delivery fees for residents, and potential missed payments from tenants;
  • Supplemental funding for Tenant-Based Rental Assistance (TBRA) and Project-Based Rental Assistance (PBRA). Even before the coronavirus crisis, the demand for HUD’s TBRA programs far outpaced the availability of federal resources—a supplemental appropriation will help close this gap and ensure that households facing the prospect of quarantine and loss of income are stably housed for the duration of the public health emergency;
  • A supplemental appropriation of $5 billion for Public and Indian Housing, in order to equip agencies on the ground with the funding they need to maintain safe conditions for residents during this crisis. The funding should target different areas of need, delivering $2 billion for lost revenue, $1.5 billion for short term mitigation and operating costs, and $1.5 billion for emergency staffing, communications, and retrofits.

Flexible Grants for States, Counties, and Cities 

CDBG funds are flexible in nature which allows them to address a wide range of challenges faced by both small rural towns and major metropolitan areas, making it an effective tool for localities in their effort to stabilize and maintain affordable housing and vibrant communities in the face of this global health challenge. 

  • $35 billion for supplemental CDBG funds that allow for states and localities to reimburse themselves for extra costs of public safety; grants to nonprofits for homeless services, medical services, and temporary housing costs. This must be coupled with broad waiver authority, similar to that allowed for CDBG-DR funds, so creative new economic development grants and loans that create or preserve jobs for people at or below 80% of AMI are allowed. 

Homelessness

People experiencing homelessness are at high risk of contracting coronavirus. Many are seniors or have preexisting medical conditions that make them particularly vulnerable. Simultaneously, living conditions on the street and in shelters lack basic preventative necessities -- like soap -- and make it impossible to practice social distancing or self-quarantine, thus creating increased risk to both people experiencing homelessness and the general public.
In order to address this public health challenge, we urge Congress to provide: 

  • Increased supplies for shelters and service providers, by increased funding for the Office of the Assistant Secretary for Preparedness and Response; 
  • $5 billion in Emergency solutions Grants (ESG) funding to identify spaces for special populations to go to self-quarantine. ESG is not competition-based, and so the funds can move the door very quickly; and 
  • An increase in Continuum of Care funds for infectious disease preparation and response. 

Homeownership

Low-income homeowners are also at risk of losing their homes if they are unable to pay their mortgage. We encourage the federal government to provide financial assistance in addition to regulatory protections against foreclosure, including:

  • An extended period of interest payments made on behalf of borrowers with forborne principal; (for example, 90 days) rather than just a once-time full mortgage payment; 
  • Assistance to low-income homeowners to pay property taxes and utility bills; and  
  • Housing counselling and foreclosure prevention efforts. 

Small Business/Community Revitalization 

In order to ensure communities continue to thrive after the threat of coronavirus has passed, Congress must continue to support small businesses in their supplemental legislation. Enterprise recommends: 

  • $1 billion in new funding for the CDFI Fund, along with a moratorium on loan payments to the fund;
  • Low-documentation SBA grants for small business with demonstrated impact;  
  • A mechanism to ensure some SBA benefits provided by the government get passed on to employees.

For more information on policy recommendations regarding the COVID-19 response, see Enterprise’s Senior Director for Public Policy Sarah Brundage’s blog, which offers statutory and regulatory federal actions that can provide timing relief and prevent Housing Credit projects from losing their tax credits due to COVID-19’s impact. And for information on how states and local governments are responding see Enterprise’s Senior Director for State and Local Policy Flora Arabo’s blog. Sign up for our Today and Housing and Capitol Express newsletters for regular updates. 

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