From the Field: Pennsylvania Increases Potential Funding for Affordable Homes to $40 Million

Pennsylvania Governor Tom Wolf signed on June 28 a state spending bill that increased the cap to $40 million on a revenue source for the Pennsylvania Housing Affordability and Rehabilitation Enhancement Fund (PHARE), the state housing trust fund. 

The potential new funding will help create more affordable housing, provide services to keep Pennsylvanians in their homes, help low-income people become first-time homeowners, and assist communities address blight. NLIHC state partner the Housing Alliance of Pennsylvania urged State Senators Art Haywood (D-4) and Elder Vogel (R-47) to advance this important legislation.

Created in 2010, PHARE receives funding from three sources, a portion of the Realty Transfer Tax (RTT), a portion of Marcellus Shale Impact Fees, and the national Housing Trust Fund. Marcellus Shale Impact Fee funding can be used only in specific communities. The RTT funding, based on a formula that grows as the real estate market grows, can be used statewide. The RTT was previously capped at $25 million. Under this new law, if the real estate market continues to stay strong, up to $15 million could be added to the PHARE fund up to the new $40 million limit.

There is a serious shortage of affordable housing in Pennsylvania. Landlords charge rents unaffordable to households in every community across the state, from the most rural to the most urban. NLIHC’s report The Gap: A Shortage of Affordable Homes shows there are only 42 homes affordable and available for every 100 extremely low-income households in Pennsylvania.

PHARE-RTT-funded projects demonstrate the diverse ways grants can be used to help address a variety of community, social, and infrastructure issues related to affordable housing. Successful PHARE projects include Delaware County Department of Human Services’ foster youth rental assistance program; new housing opportunities for seniors created by Delaware County Department of Human Services and Fayette County; and Montgomery County’s Office of Community and Economic Development’s program that provides homes for families and single adults returning from the hospital, jail, or treatment facility.

“Everyday organizations at the local level are making it possible for more of Pennsylvania’s families to access a home of their own through rental housing and homeowner opportunities and for local leaders to demolish and rehabilitate blighted properties,” said Housing Alliance Executive Director Phyllis Chamberlain. “This will be even more possible because of the General Assembly’s action to increase funding for the state housing trust fund, otherwise known as PHARE. We applaud the leadership of the general assembly, especially Senators Art Haywood and Elder Vogel. PHARE is good for Pennsylvania’s families, and it benefits Pennsylvania’s economy. More affordable housing creates jobs and brings new resources to communities. And less blighted properties increase property values and revitalize our local communities.”

For more information, contact Levana Layendecker, deputy director of the Housing Alliance of Pennsylvania, at: levana@housingalliancepa.org or 215-576-7044.