HUD released an economic justice agenda on August 4 outlining actions the department will take to help low-income renters develop credit, save resources for homeownership, access housing counseling, and build wealth. Additionally, HUD released a Notice of Funding Opportunity (NOFO) for $113 million for the Family Self-Sufficiency (FSS) program to help HUD-assisted families increase earned income and improve their financial stability. HUD Secretary Marcia L. Fudge announced the agenda, Bridging the Wealth Gap: An Agenda for Economic Justice and Asset Building for Renters, and the new funding opportunity during a virtual event hosted by Axios on affordable and fair housing. Secretary Fudge noted that the economic justice agenda is part of HUD’s efforts to address the systemic racism that permeates government and to help those who are historically underserved.
The agenda outlines the expansion of asset-building practices for renters as a reparative tool to advance economic justice. Unequal access to savings, lack of positive credit histories, and difficulties accessing banking services are problems that disproportionately impact renters and contribute to the racial wealth gap. Federal programs have not historically focused on helping low-income families safely access financial institutions and tools. Bridging the Wealth Gap seeks to break down barriers within federal programs that perpetuate inequities and prevent progress towards financial stability. The agenda aims to help HUD-assisted renters take critical steps toward financial well-being and potential homeownership through saving, credit building, and banking.
Bridging the Wealth Gap outlines current and future actions being taken by HUD to promote asset-building, including providing credit and financial counseling to renters, helping HUD-assisted young adults save, and expanding asset-building programs like the FSS program. The initiative outlines future asset-building actions HUD will take, such as exploring how to use positive rental payments towards credit score and mortgage underwriting calculations. Additionally, HUD will work to integrate financial well-being and supportive services into standard PHA practices and to expand and reform homeownership support for HUD-assisted tenants.
The $113 million FSS NOFO marks a historic expansion of the program and is central to HUD’s economic justice agenda. The FSS program is the nation’s largest asset-building program for low-income families, currently serving around 65,000 participants at over 700 Public Housing Authorities (PHAs). FSS is a voluntary program that combines coordination of services and supports from community partners with an escrow savings account to help participants grow their earned income and savings and increase their financial well-being overall. Upon graduation from the program, the average family participating in FSS in 2021 had about $9,500 in savings.
On May 17, HUD published a final rule to make FSS available to even more families (see Memo, 5/23). Among other provisions, the final rule permits any adult household member to enroll in the program and removes regulatory barriers to program graduation. Through the new funding opportunity, HUD anticipates being able to fund new FSS programs and renewals. For the first time, owners of multifamily properties participating in the Section 8 program are eligible to apply for funding under this grant opportunity. The fiscal year (FY) 2022 FSS NOFO competition is available on Grants.gov, with an application deadline of October 3, 2022.
“With Bridging the Wealth Gap and this historic funding opportunity, we’re trying to make sure that every single person in this country can get their piece of the American dream,” said Secretary Fudge. “We’re looking at everything through a lens of equity and how we address systemic racism. We’re giving people who have historically been left out and underserved the resources to take a chance on their futures – to improve their credit, save resources for homeownership and other needs, and build wealth. That’s what this is all about.”
Read Bridging the Wealth Gap at: https://bit.ly/3P1F0FI
Watch Secretary Fudge’s conversation with Axios at: https://bit.ly/3OYnpOP