Sign-on to Support Rural Housing

By any measure, most of rural America has still not recovered from the Great Recession. According to the Economic Research Service, since 2007, rural median income has averaged 20 percent below the urban median. Over 15 percent of all rural counties, more than 300 across the country, are persistently poor with at least 20 percent of the population living in poverty over the last 30 years.
By any measure, most of rural America has still not recovered from the Great Recession. According to the Economic Research Service, since 2007, rural median income has averaged 20 percent below the urban median. Over 15 percent of all rural counties, more than 300 across the country, are persistently poor with at least 20 percent of the population living in poverty over the last 30 years.
Now, with a new crisis looming, the National Rural Housing Coalition urges Congress to take action aimed at protecting current rural housing borrowers and helping to jump-start rural economies by investing in housing programs and water and wastewater financing.
Short Run:
USDA has some 200,000 low-income homeowners. Over 10,000 have requested a moratorium on their loans.
Congress should authorize USDA to provide refinancing to borrowers up the statutory limit for section 502 loans. Under current law, a section 502 direct borrower may only receive a loan for a period of 33 or 38 years, depending on income. While USDA has tools at its disposal – including reducing the interest rate on a loan – in some cases, low-income families may need more time than is available on their current mortgage to afford monthly payments.
This will allow USDA to better tailor loans to the need of current borrowers in order to weather these new challenging economic times:
The proposed amendment to the Housing Act of 1949:
SEC XXX. Section 505 of the Housing Act of 1949 is amended by replacing the heading with “Loss Mitigation and Foreclosure Procedures,” renumbering subsection (b) as (c), and inserting a new subsection (b) as follows:
“(b) Loan Modification
Notwithstanding any other provision of this title, for any loan made under Sections 502 and 504, the Secretary may modify the interest rate and extend the term of such loan for up to 30 years from the date of such modification.”
Appropriations Amendment – In the end, granting moratorium and revise loan modifications is unlikely to be adequate to save most low-income homeowners. Therefore, Congress should provide an appropriation that covers the cost of interest and principal repayments.
RURAL HOUSING INSURANCE FUND PROGRAM ACCOUNT
For an additional amount for ‘‘Rural Housing Insurance Fund Program Account’’, $90,000,000, to remain available until September 30, 2021, for the cost of direct loans, including the cost of modifying loans as defined in section 502 of the Congressional Budget Act of 1974, as follows: section 502 loans [42 U.S.C. 1472] to assist families impacted by coronavirus: Provided, That such amount is designated by the Congress as being for an emergency requirement pursuant to section 251(b)(2)(A)(i) of the Balanced Budget and Emergency Deficit Control Act of 1985.
USDA has some 14,000 rental developments with some 400,000 units. Of this number, approximately 270,000 receive rental assistance. Another 40,000 households live in USDA financed housing without a rental subsidy. Congress should provide an appropriation of rental assistance that is adequate to assist residents of USDA financed rental housing impacted by COVID-19, and those funds should be available through September 30, 2021. Congress should make a similar adjustment to USDA’s voucher program to ensure that voucher holders impacted by the COVID-19 can receive relief.
Invest in Rural America
Including:
WASHINGTON, Dec. 5, 2019 /PRNewswire/ — The Board of Directors of the National Rural Housing Coalition (NRHC) held a two-day meeting on December 3-4, 2019, in Washington D.C., marking the coalition’s 50th Anniversary. A commemorative pin and poster was released by the coalition this week and a page documenting NRHC’s 5 decades of advocacy is featured on the organization’s website. In addition, a reception to honor NRHC’s anniversary and accomplishments was also held on December 3rd on Capitol Hill, with Rep. Jim Costa (D-CA) providing a keynote.
“NRHC, a national membership organization that advocates for improved housing and community facilities in America’s small town and farming communities, has 120 members located in rural and farming communities across the country,” said Bob Rapoza, executive secretary of the National Rural Housing Coalition. “For 50 years, our members have worked diligently to promote and defend the principle that rural people have the right — regardless of income — to a decent, affordable place to live, clean drinking water, and basic community services.”
Rep. Costa, during his remarks at the reception, noted the significant contributions that federal rural housing programs have made to improving housing conditions in his rural, Central Valley District. The Congressman also noted the importance of a Mutual-Self Help Housing in helping low-income families build their own homes and gain equity.
The two-day meeting was designed to inform the board on federal housing and community development policy. The board heard from officials from the USDA Department of Agriculture’s Rural Housing Service, staff from the Office of Comptroller of Currency and the Community Development Financial Institutions (CDFI) Fund. Bob Rapoza reported on the current status of rural housing appropriations in Congress.
The Board meets twice a year to discuss current federal policy and legislation. Beyond getting a status report on Congress and from federal agencies, the board mapped out its policy initiatives for the New Year.
“Throughout its history, NRHC has been at the forefront in pushing for better federal rural housing policy, and we will continue building on that success in the years ahead,” Rapoza said.
About the National Rural Housing Coalition
NRHC is a national membership organization comprised of nonprofit housing organizations, housing developers, state and local officials, and housing advocates. Since 1969, has NRHC worked to focus policy makers on the needs of rural areas through direct advocacy and by coordinating a network of rural housing advocates around the nation. NRHC regularly sponsors conferences to develop specific policies and legislative proposals with direct input from housing experts in the field.
Contact: Bob Rapoza
National Rural Housing Coalition
1155 15th St NW, Suite 400
Washington, DC 20005
Phone: (202) 393-5225
Fax (202) 393-3034
The deadline for requests to the House Agriculture subcommittee of Appropriations is April 4th. If you have not done so, we urge you to contact your Representative now. Members are inundated with requests, so the sooner your rural housing request are in, the more time staff will have to process and include them in their Boss’s request to the Committee.
Below you will also find templates for House Appropriations Ag Subcommittee requests for rural housing programs.
FY 2020 Approps Request Form 502
FY 2020 Approps Request Form_Section 515 Rural Rental Housing Loans
FY 2020 Self-Help Request Form
FY 2020 Approps Request Form_Section 516-514
As the budget stalemate in Washington drags on the consequences and impacts are becoming clearer and increasingly disturbing. Without any justification, the Administration has closed 25 percent of the federal government and among the casualties are agencies with the responsibility for financing affordable housing, clean drinking water, and community opportunity.
NRHC members have reported about one small but important agency – the Rural Housing Service – and the recent absence of its housing assistance. Families waiting to close their home mortgages are hung out to dry, families building their homes are stymied, and hundreds of thousands of families receiving rental subsidies may soon lose that assistance if the government shutdown goes on for “months or years.”
Below is a compilation of information supplied by NRHC members on the impact of the shutdown on rural housing efforts in their states and communities.
Section 502 Direct
Single Family Housing Guaranteed Loan Program
Section 514/516 – Farmlabor Housing
Section 515
Self Help Housing
Rental Assistance
Provides a rental housing subsidy to very low income households, elderly households, and persons with disabilities. Over 270,000 families receive this assistance from USDA. The last rental assistance payments were made in December 2018. There is not any information available for January payments. Without those payments, housing for these families will be in jeopardy.
Home Safety and Maintenance Repair Grants
Operation Issues
Greystone Leads Effort to Upgrade Rural Housing for the Poor
Shortages of affordable, low-income housing are reaching crisis proportions in some parts of the U.S.
Plantation Apartments in Richmond Hill, Ga. New York finance firm Greystone & Co. has teamed up with federal and state agencies in Georgia to preserve 1,310 low-income rental apartments built in the 1970s and 1980s by the Agriculture Department for rural households.
New York housing-finance firm Greystone & Co. has teamed up with federal and state agencies in a $168.6 million effort to preserve and recapitalize 1,310 low-income rental apartments in Georgia.
The units, developed and managed by Atlanta-based Hallmark Cos., were built in the 1970s and 1980s through a U.S. Agriculture Department program targeting rural households. Tenants, who are required to meet income-eligibility requirements, pay about $400 to $500 a month in rent.
The portfolio includes 26 properties in 17 counties. Like tens of thousands of other properties developed under federal housing programs, the Georgia homes are badly in need of repair.
The deal, known as a recapitalization, provided funds for upgrades worth an average of $37,000 per unit, including such improvements as new appliances, counters, cabinets and electrical systems. The recapitalization also involved a sale of the properties and a refinancing of the debt on the portfolio. Through those actions, enough surplus capital is being raised to pay for the improvements.
“Unless you do something creative, they really have no chance of being preserved,” said Tanya Eastwood, president of Greystone’s affordable-housing redevelopment unit.
The sellers of the properties were the limited partners who decades ago provided equity financing to Hallmark for their development, mostly in exchange for tax credits. The new owner is a venture of Hallmark and new equity investors who also are getting returns primarily in the form of low-income-housing tax credits.
The units are being preserved at a time when shortages of affordable and low-income housing are reaching crisis proportions in some parts of the country. According to a recent report by the National Low Income Housing Coalition, the U.S. has a shortage of more than 7.2 million units for “extremely low income” renter households.
Hundreds of thousands of units are at risk of becoming unusable, housing advocates say. “There’s obviously a great need for more affordable housing, but we also can’t afford to lose any of the existing,” Ms. Eastwood said. The program in Georgia “allows us to prevent the crisis from getting worse.”
Much of the financing for the Georgia effort is coming from a combination of government housing and low-income assistance programs including the sale of $54.3 million in “private activity” bonds. The tax exemption on those bonds wound up on the chopping block during the debate over tax overhaul last year, but housing advocates and others were able to save them.
Meantime, about $28 million of debt financing is being provided through programs run by the Rural Housing Service, an arm of the Agriculture Department that dates back to the Farmers Home Administration, which has its roots in the Great Depression.
The Georgia units now being recapitalized were developed under the Section 515 rural-housing program, which was launched in 1962 originally to create low-rent housing for people over 62 years old.
Today, Section 515 properties are available for low-income families and individuals as well as people with disabilities, according to an Agriculture Department spokeswoman.
Since the program launched, 18,426 properties with 563,936 units were created. As of March 31, there were 13,357 properties with 407,826 units in the department’s portfolio, the spokeswoman said.
No new properties were created in 2017, and no new properties are scheduled to be created this year, she said.
Founded in 1988, Greystone is a real-estate lending, investment and advisory firm that is involved with a wide range of housing. The company originated $9.5 billion in commercial real-estate loans in 2017 and has a loan-servicing portfolio of $30 billion.
Greystone has done about 20 deals that have recapitalized and upgraded more than 12,000 low-income-housing units with the same basic structure as the Georgia deal.
“We kind of built a factory,” said Ms. Eastwood.
Hallmark is an owner and manager of about 11,000 affordable-housing units, mostly in the southeast U.S.
Write to Peter Grant at peter.grant@wsj.com
Appeared in the April 18, 2018, print edition as ‘Greystone to Finance Low-Income Housing.’
ABOVE: Edgar and Naomi Bermudez shuffle rock that will be used for the foundation of their new home in Wasco.
Dozens of families in Wasco are building new homes for each other, taking part in a program funded through the U.S. Department of Agriculture and guided by the nonprofit, Self Help Enterprises.
The new homeowners don’t need a dollar for a down payment. Instead, they are required to do 40 hours of work on the home every week. The development in Wasco consists of 33 homes, with 10-12 in each of three waves.
Construction begins for seven families in Provo, Utah. Project supported by Self-Help Homes.
FULL STORY: Seven families in Southern Utah are anxious to get started on what will be their new homes. A groundbreaking ceremony in LaVerkin last Wednesday turned over shovels of dirt, that will soon become a foundation. Four of the new homes will be built in LaVerkin and the other three in Toquerville.
The families are part of Self-Help Homes. They all received low interest loans from the government to build each others homes. The program is growing in Southern Utah as word continues to get out.
Congressmen Sean Duffy (R-WI) and Jim Costa (D-CA) are leading a Dear Colleague in support of USDA Rural Housing programs. Below, find the letter.
Support Adequate Funding for USDA Rural Housing Service in the FY19 Budget
DEADLINE: March 12, 2018
Dear Colleague,
Please join Representatives Sean Duffy and Jim Costa in sending the following letter to the House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies to respectfully request adequate funding for United States Department of Agriculture (USDA) Rural Housing and water sewer programs.
USDA Rural Housing programs provide a critical lifeline to low-income, rural families. Through low-cost loans, grants, and other assistance, USDA programs improve housing conditions and quality of life in rural America.
For example Section 502 Direct Loan Program, which has helped more than 2.1 million families realize the American Dream and build their wealth by more than $40 billion, is the only federal homeownership program that exclusively targets low- and very-low income rural families. The program provides essential funding to fill in the gap in the private market, allowing families who would otherwise be unable to access affordable mortgage credit achieve homeownership.
The Section 523 Mutual Self-Help Housing program is another critical component of USDA’s Rural Housing initiatives. Self-Help Housing, which celebrated its 50 year anniversary and 50,000th family served in 2015, is the only federal program that combines “sweat equity” homeownership opportunities with technical assistance and affordable loans for some of America’s neediest rural families.
Rural water –sewer loans and grants are essential for building communities.
Our rural communities are in dire need of affordable, livable housing. Please join us in supporting rural districts all over the country by signing this letter.
Please contact Ryan McCormack in Rep. Duffy’s office (Ryan.McCormack@mail.house.gov) or Ben Goldeen in Rep. Costa’s office (Ben.Goldeen@mail.house.gov) if you would like to sign or have further questions.
Support Adequate Funding for USDA Rural Housing Service in the FY19 Budget
Sending Office: Honorable Sean P. Duffy
Sent By: Ryan.McCormack@mail.house.gov
Support Adequate Funding for USDA Rural Housing Service in the FY19 Budget
DEADLINE: March 12, 2018
Dear Colleague,
Please join Representatives Sean Duffy and Jim Costa in sending the following letter to the House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies to respectfully request adequate funding for United States Department of Agriculture (USDA) Rural Housing and water sewer programs.
USDA Rural Housing programs provide a critical lifeline to low-income, rural families. Through low-cost loans, grants, and other assistance, USDA programs improve housing conditions and quality of life in rural America.
For example Section 502 Direct Loan Program, which has helped more than 2.1 million families realize the American Dream and build their wealth by more than $40 billion, is the only federal homeownership program that exclusively targets low- and very-low income rural families. The program provides essential funding to fill in the gap in the private market, allowing families who would otherwise be unable to access affordable mortgage credit achieve homeownership.
The Section 523 Mutual Self-Help Housing program is another critical component of USDA’s Rural Housing initiatives. Self-Help Housing, which celebrated its 50 year anniversary and 50,000th family served in 2015, is the only federal program that combines “sweat equity” homeownership opportunities with technical assistance and affordable loans for some of America’s neediest rural families.
Rural water –sewer loans and grants are essential for building communities.
Our rural communities are in dire need of affordable, livable housing. Please join us in supporting rural districts all over the country by signing this letter.
Please contact Ryan McCormack in Rep. Duffy’s office (Ryan.McCormack@mail.house.gov) or Ben Goldeen in Rep. Costa’s office (Ben.Goldeen@mail.house.gov) if you would like to sign or have further questions.
_______________________________________________________________________
Dear Chairman Aderholt and Ranking Member Bishop:
As the House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies considers the Fiscal Year 2019 (FY 19) Appropriations Bill, we write to respectfully request adequate funding for United States Department of Agriculture (USDA) Rural Housing Programs and Rural Water-Sewer program.
Access to safe, decent, and affordable housing can transform lives. Yet, due to lower incomes and higher poverty rates, far too many rural families live in housing that is too expensive, in substandard condition, or both. According to U.S. Census data, approximately, 1.5 million rural homes—or about 5.9 percent—are in substandard condition. The poverty rate for rural areas, estimated at 18.1 percent according to the Economic Research Service, is both higher and more concentrated than the urban (15.1 percent) and national (15.5 percent) poverty rates. Overall, 82 percent of high-poverty counties—or 571 of the 703 counties with at least a 20 percent poverty rate—are rural. And, 86 percent of the nation’s “persistently poor” counties are rural, as well.
Additionally, 30 percent of rural families (more than 8 million) spend more than 30 percent of their monthly gross income on housing. These households are considered “cost burdened,” and are likely to struggle to pay for other basic needs, such as health care and child care.
USDA Rural Housing homeownership and rental housing programs have a proven track record of overcoming these barriers to affordable housing in rural America. By providing low-cost loans, grants, and other related assistance, these key programs have not only helped millions of rural families improve their quality of life, but have created thousands of jobs in rural America. In 2017, RHS assisted over 130,000 rural families in improving their housing conditions through home ownership loans, home repair loans and grants and rental and farmworker housing programs and provided over 468,000 units of affordable, safe rental housing.
The 2013 Drinking Water Needs Assessment indicated a national need of $64.5 billion for small systems[3] (systems that serve 3,300 or fewer persons) in the 50 states, Puerto Rico and other U.S. Territories. This represents 17.4 percent of total national need and comprises some 41,000 systems (82.8 percent of all systems) and 24 percent of the population. The need of water systems in American Indians and Alaska Native villages totals $3.3 billion.
USDA’s Water and Sewer loan and grant financing program is a key component of economic development in rural America. Every water and wastewater construction dollar generates nearly $15 of private investment and adds $14 to the local property tax base. The agency boasts a portfolio of more than 18,000 active water/sewer loans, more than 19 million rural residents served, and a delinquency rate of just 0.18 percent.[1] Fiscal Year 2017, USDA funded 736 projects serving 2.3 million people in small rural communities of 10,000 people or less.
We urge the Subcommittee to support the Mutual Self-Help Program, Section 502 Direct Loans homeownership loans, rental assistance, new multi-family construction and preservation, farmworker housing as well as water sewer financing. All provide critical support to rural populations, improve rural communities and create jobs.
Sincerely,
Sean Duffy and Jim Costa.