In a new report issued on May 17, the Government Accountability Office (GAO) warned that 90% of USDA’s rental housing portfolio – more than 407,000 apartments in an estimated 13,000 properties – is at risk of exiting the portfolio by 2050 due to the maturation of USDA-financed mortgages. The report was initiated by the chair and ranking member of the Senate Agriculture Appropriations Subcommittee Jerry Moran (R-KS) and Jeff Merkley (D-OR).
The GAO found that recent efforts by USDA to address the rising number of mortgages reaching maturity and existing the portfolio have not been successful. The agency's planning efforts lacked key steps such as establishing preservation goals, developing metrics for evaluating preservation efforts, and analyzing and responding to risks facing its portfolio, like resource limits and growing capital rehabilitation needs.
The GAO’s recommendations include granting USDA the authority to renew annual rental assistance payments to owners wishing to continue receiving them and to provide vouchers to tenants living in rental assistance units in properties whose owners choose to no longer receive rental assistance. Legislation introduced by Representative Ann McLane Kuster (D-NH) and Senator Jeanne Shaheen (D-NH), and endorsed by NLIHC, would enact this recommendation to “decouple” rental assistance from USDA’s loan programs.
The GAO also recommended: establishing a process to help ensure regular and frequent updates to USDA’s preservation tool and its underlying data; establishing performance goals and measures for its rural rental housing preservation and rehabilitation efforts and reporting out these outcomes; monitoring the results of rural rental housing preservation efforts and assessing the degree to which those efforts yielded intended outcomes; and identifying, analyzing, and responding to risks to achieving its preservation goals, including resource and staffing limitations.
Read the GAO report at: https://bit.ly/2Iufdo2