Budget Key Issues Legislation Poverty

2016 Omnibus Bill Includes Record Funding For Rural Housing Programs



Contact: Bob Rapoza
National Rural Housing Coalition
Phone: (202) 393-5225


2016 Omnibus Bill Includes Record Funding for Rural Housing Programs

WASHINGTON, Dec. 17, 2015 – Yesterday, Congress released the omnibus appropriations bill for fiscal year (FY) 2016. This bill funds several programs, including the Mutual Self-Help Housing Program, Section 521 Rural Rental Assistance, and HOME Investment Partnership Program, above the levels previously included in the House and Senate appropriations bills.  This funding will allow the U.S. Department of Agriculture and U.S. Department of Housing and Urban Development to address the needs of rural communities.

“The funding for rural housing programs in this year’s appropriations bill are the highest they have been in recent memory, and at least since the Federal Credit Reform Act of 1992,” said Bob Rapoza, the executive secretary of the National Rural Housing Coalition. “In an era of austerity, partnerships between nonprofit and for-profit organizations, local community governments, and the federal government are essential.”

Around 46.2 million Americans live in rural communities, and 8.2 million of them live in poverty. NRHC notes that 2.6 million of those people are children under 18.  Concentrated poverty leads to decreases in affordable standard housing, health conditions, and educational outcomes.  Even though housing in rural communities is generally less costly, because of lower incomes, higher poverty rates, limited housing stock, and limited access to credit, many rural Americans live in inadequate and substandard homes.

Programs funded by the omnibus will provide the resources needed to develop and preserve affordable rural housing.  Section 521 Rural Rental Assistance payments are made to owners of USDA Section 515 financed rural multi-family homes to subsidize the rent payments of low- and very-low income tenants, who often have no other housing option. The funding level ensures all current very-low income tenants, including many elderly and persons with disabilities, will continue to have a safe, decent place to live.

With the Mutual Self-Help Housing Program, 8 to 12 low- and very-low income family groups build their own homes with technical assistance and supervision from nonprofit housing organizations.  Self-help families put in an average of 1,189.9 labor hours in constructing their homes, while working regular jobs and caring for their children. The President’s budget proposed a significant cut to the Self-Help program, but Congress rejected this reduction. The omnibus will fund the program at the FY2015 level.

The HOME Program, funded at $950 million for FY 2016, provides grants to states and local governments. The grantees, who often partner with local nonprofit organizations, use this funding for a variety of housing-related projects such as building, buying, or rehabilitating affordable housing for rental and homeownership purposes.  A recent report by the HOME Coalition indicates the program generated $94 billion in local income and 1.5 million jobs nationwide. With the funding level for the HOME Program included in the omnibus, some of the nation’s neediest families will get the support they require.

“It is wonderful to see members of Congress and the President standing up for rural families,” said Rapoza.  “NRHC encourages the House and Senate to vote in support of the increased funding for these essential programs for rural communities.”


About the National Rural Housing Coalition
NRHC is a national membership organization of non-profit housing organizations, housing developers, state and local officials, and housing advocates. Since 1969, NRHC has promoted and defended 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. For more information, visit




Budget Key Issues

“Spending Turnaround at USDA is Good News for Rural Families”

Bob Rapoza wrote an article on USDA Section 502 spending in FY 2015 that was published by Government Executive today.  In the article, Bob discusses the importance of the home loan program for rural communities, the role that Under Secretary Lisa Mensah played in ensuring the success of the program, and the bipartisan support for the home loan program on the Hill. To read the article, please click here.

Bob is the Executive Secretary of the National Rural Housing Coalition and the founder and president of Rapoza Associates, a public interest lobbying and government relations firm in D.C.

Budget Key Issues Legislation

Why HOME Program Funding Matters

There is a substantial need for housing resources across our nation’s small town and farming communities.  Although homeownership is the predominate type of housing available in rural America, rural housing is much more likely to be substandard than in urban areas. In fact, six percent of rural homes are either moderately or severely substandard, often with leaking roofs, or inadequate plumbing or heating systems.  Affordability issues also plague rural communities, with some eight million rural families paying more than 30% of income for housing, and 23% of all rural families paying more than 35% of income for shelter.  To improve the quality and affordability of housing in their communities, local governments and nonprofit groups rely, in part, on HOME Investment Partnership Program (HOME program) funding.

Authorized by the Cranston-Gonzalez National Affordable Housing Act of 1990 (PL 101-625), the HOME program was designed to benefit low and very-low income Americans by increasing federal support for affordable housing.  Since its creation in 1990, the HOME program has financed more than 1.1 million affordable homes for low and very-low income households.

The HOME program, administered by the United States Department of Housing and Urban Development, provides federal block grants to states, local governments, and consortia, called Participating Jurisdictions or PJs, which use the funding to develop and support affordable housing in their communities.  All PJs are required to provide matching contributions of at least 25% of the HOME funds spent for tenant-based rental assistance, rehabilitation, acquisition, and new construction, although the matching requirement can be reduced for PJs experiencing financial distress or severe financial distress.

PJs use HOME grants to support a variety of activities to meet the specific housing needs of their communities.  Some activities include site acquisition, site improvements, demolition, and relocation.  PJs also use HOME funding as a source of critical gap financing to ensure the success so rental housing funded with the Low-Income Housing Tax Credit or other federal, state, or local housing projects.  HOME funds can be used for both permanent and rental housing.   All PJs must commit HOME funds within 24 months of receipt, and they must be expended within five years.  Although there is no set-aside for rural areas under the HOME program, states receive 40 percent of HOME funds each year, which may in turn be used by smaller and rural communities.

While most HUD programs have limited utility for rural communities, the structure of the HOME program allows it to serve as a central tool to improve the quality of housing for rural residents.  Because HOME funds can be utilized in many different ways to support a communities’ affordable housing needs, localities and non-profits are able to use HOME programs allocations in conjunction with funding from other sources, such as Section 502 loans from the United States Department of Agriculture (USDA) to adequately fund their projects.  Rural Housing programs administered by the USDA has been repeatedly reduced in recent years – between 2010 and 2015, USDA rural housing budget authority was reduced by 54%.  Thus, HOME is particularly important for rural areas.

HOME program funding has been used to assist rural communities all around the country.  Specific HOME program funded projects include:

  • In Morehead, Kentucky, single mother Kayla Brooks, with help from Frontier Housing and the HOME program was able to purchase a home for her and her then five-year-old daughter Alanah. Because of the financing package, Ms. Brooks now spends just $140 more on her monthly mortgage than what she paid in rent and utilities.
  • NCALL Research and the Milford Housing Development Corporation worked together in Middletown, Delaware to help ensure that North Lake Village, a 52-unit rental community that was one of the only sources of affordable housing in town, received the substantial upgrades it desperately needed. Thanks to $1.82 million in HUD HOME funding in conjunction with other sources of funding, North Lake Village’s renovations were completed in 2013.  Today residents enjoy improvements including a new exterior, plumbing, electrical, HVAC, and appliances, as well as a new playground, larger laundry facilities, and a computer station.
  • Up until 2011, Wright, Wyoming, which is the nearest town to many of Wyoming’s coal mines, had no affordable housing whatsoever. Wyoming Community Development Authority (WCDA) utilized HOME funds and the Low Income Housing Tax Credit to develop Wrightland Apartments, which includes 11 two-bedroom units, each with their own garage for the fierce Wyoming winters, exclusively targeted to families who earn less than 50 percent of the Area Median Income.

Unfortunately, the development and continuation of projects like these are currently being threatened by severe cuts to HOME program funding levels.

The past several years have shown a steady decline in HOME program funding.  From FY 2009 to FY 2011, funding for the program dropped about 9.5%, from $1,825,000,000 to $1,650,000,000.  Since FY 2011, the funding for the HOME program has been further cut – decreasing $650,000,000 from FY 2011 to FY 2012.  Although the funding for the HOME program was increased in FY 2013, from $1,000,000,000 to $1,006,120,000, it was reduced to an all-time low for FY 2015, when it was funded at only $900,000,000.

According to a Rural Work Group report, the HOME program in the past provided over $500 million annually in affordable housing and homeownership programs for rural areas.[1]  While this amount has decreased in recent years as overall funding to the HOME program has been reduced, this program still provides crucial assistance to some of the country’s communities most in need.

092115 HOME 1

*Estimation is 68% of 40% of the Appropriations Amount (the state allocations), based on the Rural Work Group Report finding that up to 2012 about $500 million of HOME funds annually went to support rural areas.[2]

For FY 2016, the President’s budget request would fund home at $1.06 billion, while the House appropriations would fund the HOME program at $900 million, the FY 2015 rate.  The most drastic cut is from the Senate appropriations bill, which would fund the HOME program at only $66 million, which is $834,000,000 less than the FY 2015 amount.

092115 HOME 2

*Estimation is 68% of 40% of the Appropriations Amount (the state allocations), based on the Rural Work Group Report finding that up to 2012 about $500 million of HOME funds annually went to support rural areas. [3]

As the chart above illustrates, if the HOME program is funded at the Senate appropriations level, rural communities will be able to access less than $18,000,000 to meet their affordable housing needs with the HOME program.

Of HUD’s total budget of approximately $45 billion, less than 15 percent goes to rural areas.  The HOME program, funded at the requested level of $1,060,000,000 for FY16 is only a small fraction of HUD’s total budget, but goes a long way to improving the state of housing for rural America.  If funding for HOME is not increased, projects such as the ones in Wyoming, Kentucky, and Delaware highlighted above will not be possible, and the residents of rural America will be left without safe and decent affordable housing options.

In light of the fact that a total of 19.3 percent of the population of the United States lives in rural area, fully funding the HOME Program for Fiscal Year 2016 will go a long way to providing crucial resource for America’s rural residents.

[1] (2012).   The Rural Work Group was established by the Partnership for Sustainable Communities in collaboration with USDA.

[2] (2012).

[3] (2012).

Budget Legislation

Senate Appropriations Subcommittee FY16 THUD Bill Drastically Cuts HOME Program

On Tuesday, June 23, the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development (THUD) proposed to fund the HOME Investment Partnerships program (HOME) for FY16 at just $66 million, only 7 percent of the FY15 amount ($900 million).  Such a drastic cut will result in long-term consequences.  While NRHC is aware that the country is facing budget constraints, we implore members of Congress to work together to develop a budget that will restore the HOME program.

Authorized in 1990, the HOME program is a locally-driven block grant program that is vitally important to improving the quality of life of rural Americans.  Since 1992, the HOME program has created more than one million affordable homes.  State and local governments have used HOME funds to produce 495,609 home buyer homes, 466,861 rental homes, and 231,928 rehabilitated owner-occupied homes. Additionally, 298,391 families have received tenant-based rental assistance through the HOME program.

The HOME program provides grants to state and local governments, which use the funds to directly benefit the low and very-low income families in rural communities across the nation.  HOME funds are used to provide tenant-based rental assistance; housing rehabilitation; assistance to home buyers; and new construction of housing.  For example, the Florida Housing Finance Corporation (FHFC) makes funding available to nonprofit developers, for-profit developers and Community Housing Development Organizations to provide zero interest (3 percent for for-profit developers) through the HOME Homeownership Program.   The Federation of Appalachian Housing Enterprises (FAHE) worked with the city government in Beattyville, Kentucky to construct two affordable rental duplexes utilizing HOME funds.  The duplexes were occupied one month after completion, and rented for $358 per month to families with incomes below 80 percent of AMI.  For more HOME program success stories, please visit our fact page.

Continuation of the HOME program is especially crucial now, given the current state of America’s housing.  In the United States, 15.6 percent of all households, were severely housing cost-burdened.  A little more than 13 percent of all rural households are extremely cost burdened, meaning that they spend 50 percent or more of their monthly income on housing costs.  Almost 40 percent of cost burdened rural households are renters. Nearly one-third of rural renters have incomes below the poverty level, and nearly 6 percent of homes in rural communities are considered moderately or severely substandard.

If funding for the HOME program is reduced to $66 million in FY 16, compared to the President’s budget request of $1.06 billion, there would be a loss of an estimated 38,665 affordable housing units and 8,813 families assisted with HOME tenant-based rental assistance.  This would equal a loss of:

  • 16,045 units of affordable housing for new home buyers;
  • 15,099 units of newly constructed and rehabilitated affordable rental units;
  • 7,521 units of owner-occupied rehabilitation for low-income homeowners; and
  • 8,813 low-income households assisted with HOME tenant-based rental assistance.

The impact of this severe cut to the HOME program will be felt by communities all across America.  The Full Appropriations Committee markup is scheduled for Thursday, June 15, 2015.   NRHC urges members of Congress to restore funding to the HOME program.

For general information on the HOME program, please click here.