In 2009, HUD began meeting with stakeholders, including public housing residents and voucher holders, to discuss what was then referred to as Transforming Rental Assistance (TRA). In its FY11 budget request, HUD sought $350 million for the proposal, which by April 2010 was renamed Preservation, Enhancement and Transformation of Rental Assistance (PETRA).
The proposal would eventually streamline most HUD rental assistance programs into a single, new program. The first phase, however, would focus on converting almost 300,000 public housing units into a new housing subsidy program with property-based rental assistance contracts. RHRA, like its predecessors TRA and PETRA, would encourage public housing agencies to take on private mortgages and use these new resources to preserve public housing. The breadth of the proposed change, the prospect of public housing agencies taking on private debt, and the risks that debt represents if loans are not repaid have all sparked considerable debate within the housing community.
RHRA would allow, but not require, public housing agencies and some assisted housing owners to convert their current subsidy streams to new property-based rental assistance contracts. The new contracts would provide increased funding to the converted units. This additional funding could then be used to leverage private resources sufficient to preserve the housing. Funding for public housing has lagged significantly behind need for decades, causing more than 10,000 public housing units a year to be lost. This bill would put policies and opportunities in place to arrest such losses, protect tenants, and preserve housing.
The Resident Engagement Group was formed to bring resident perspectives to the RHRA debate, through meetings with HUD officials and discussion amongst resident stakeholders and their partners. The REG is facilitated by the National Housing Law Project.
The January 25 letter, signed by residents of public housing, voucher holders, and HUD-assisted multifamily tenants, reviews the REG’s concerns about RHRA. “Throughout our discussions, we have been very concerned about the idea of mortgaging public housing. While a majority of the REG is adamantly opposed to allowing mortgage liens on public housing, the group has numerous suggestions for improving and strengthening PETRA or what is now H.R. 6468.”
The letter acknowledges H.R. 6468’s “significant positive changes” when compared to HUD’s PETRA proposal and offers recommendations to improve resident rights and resident participation, public ownership, permanent long term affordability, one for one replacement, Section 3 applicability, and resident choice.
On January 26, the National Association of Housing and Redevelopment Officials (NAHRO) also sent a letter to Mr. Ellison on H.R. 6468, emphasizing the significant backlog of public housing operating and capital subsidies. “There is broad agreement among supporters of public housing that meaningful preservation solutions are necessary to ensure the continued survival of the portfolio not only as housing available to the most vulnerable members of our communities but as an essential component of our national infrastructure,” NARHO CEO Saul Ramirez writes in the letter.
NAHRO’s letter recommends its own public housing preservation proposal over RHRA. NAHRO’s proposal would allow for the voluntary conversion of public housing to either the Section 8 project-based rental assistance or to project-based Section 8 vouchers, noting Congress’s “historical commitment to the full funding of the Section 8 Project-Based Rental Assistance (PBRA) account,” the “flexible operating environment create by the Section 8 PBRA program,” and the “level of comfort in the lending community that the PBRA program has achieved.”
NAHRO’s letter questions whether rents under RHRA would provide the financial support that many public housing properties require, and takes particular issue with what NAHRO calls “collateral issues” within RHRA: allowing the HUD secretary to facilitate regional voucher administration, and its resident choice component, which would allow residents in converted public housing units to choose to move with a voucher.
Link to the REG and NAHRO letters, as well as to NAHRO’s conversion proposal, at NLIHC’s RHRA News page (formerly our PETRA Watch page), at: http://www.nlihc.org/template/page.cfm?id=262