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).

Key Issues Spotlight

Spotlight on Hillary Clinton’s Rural Platform

As the 2016 Presidential Race heats up this fall, the candidates on both sides of the aisle are introducing their platforms on a variety of policy issues, from immigration, to tax reform and education.  However, Hillary Clinton is the only candidate to have released a platform on a topic that directly impacts the lives and livelihood of people all around the country – a plan for Rural America.[1]  Hopefully, this is just the start and more candidates will lay out their policy plans.  For now, rural advocates can analyze the plan we have thus far.

Clinton’s “Plan for a Vibrant Rural America” lays out four focus areas designed to address the educational, economic, and health issues facing rural communities.  Clinton intends to (1) “Spur[ ]  investment to power the rural economy;” (2) “Rais[e] agriculture production and profitability for family farms;” (3) “Promot[e] clean energy leadership and collaborative stewardship;” and (4) “Expand[ ] opportunity in rural communities across America.” [2]

To spur the rural economy, Clinton plans to improve infrastructure, access to credit and capital, and investments.  To do so, Clinton would increase the number of Rural Business Investment Companies (RBIC), simplify regulations for community banks that do not measure assets in billions, create and invest in a national infrastructure bank, streamline, expand, and make permanent the New Markets Tax Credit (NMTC), and strengthen USDA grant programs.  These programs would facilitate and develop capital networks and, in turn, increase rural communities’ access to private sector capital.  The areas of infrastructure Clinton would focus on include rural water, transportation, and broadband services.  Regarding USDA, Clinton’s plan centers on funding flexibility and leveraging local resources by working with community partners and public entities to expand the StrikeForce Initiative.

To promote agriculture production and profitability for family farms, Clinton intends to focus on increasing funding and addressing student loan debt to support next generation farmers.  Her platform includes plans to build a strong local and regional food system by doubling funding to the Farm Market Promotion Program and Local Food Promotion Program, to ensure that the disaster assistance and crop insurance programs are focused and targeted to farmers and ranchers in need, as well as fight for immigration reform due to the role that America’s immigrant workers play in supporting the nation’s agriculture economy.

To promote clean energy leadership and collaborative stewardship, Clinton’s platform includes plans to fully fund the Environmental Quality Incentives Program; strengthen the renewable fuel standard, double the loan guarantees made through the Biorefinery, Renewable Chemical, and Biobased Product Manufacturing Assistance Program to support the bio-based economy’s growth; and to launch her “Clean Energy Challenge,” which would involve, among other things, expanding USDA’s Rural Utilities Service.

The final focus of Clinton’s rural platform is to expand opportunity in rural communities across America by strengthening the rural economy and raising wages for working Americans. To strengthen the economy, Clinton plans to increase investments in Early Head Start and incorporate President Obama’s plan to make community colleges free.  The final aspect of Clinton’s rural platform focuses on improving the health and healthcare services for rural communities through improved technologies and increased of health care facilities, including substance abuse centers, in rural areas.

Notably, Clinton’s plan does not mention a critical issue for many of America’s rural residents, and that is the need for affordable and decent housing.  At a minimum, it provides an outline of her vision for rural residents to consider and demonstrates that the economic opportunity needs of rural communities are on her mind as she considers what her agenda would be if elected president.

In light of the fact that over 15 percent of Americans live in rural communities, the lack of attention to this population from most of the Presidential Candidates is unfortunate.  It is still early in the 2016 race to the White House, and we look forward to hearing what the other candidates’ visions are for rural America.  As more candidates (hopefully) introduce their platforms for Rural America, check back to the NRHC Blog for updates.



Key Issues Legislation

Ask Your Senators To Support USDA Rural Housing Funding

Sen. Schumer (D-NY) released a Dear Colleague Letter asking fellow Senators to join him in urging the Senate Appropriations Committee to fund critical USDA Rural Housing programs!

Please CALL YOUR SENATORS TODAY and ask them to (1) Sign the Schumer Dear Colleague Letter and (2) Submit an Appropriations Request for these programs!

Senators can sign on by contacting Lane Bodian ( by March 24.


The Schumer Dear Colleague letter can be found here.

NRHC’s Appropriations Request Spreadsheet is here.

NRHC’s List of Senate Targets is here.

Sample Script

When you call your Senators’ office:

“Hi, my name is [name] and I am with [organization] and I live/work in your district. I’d like to speak with the Senator’s staffer who handles Agriculture or Housing issues.”

Once you are connected to the right staffer:

“Hi, I’m [name] and I work with [organization] that serve your district. I’m calling because I want to ask the Senator to sign onto a Dear Colleague Letter from Sen. Schumer in support of funding for USDA Rural Housing programs. These programs are critical to the work we do in your state to help low-income rural families find affordable rental housing or to become homeowners. I would also like to ask the Senator to submit an appropriations request to support these programs.”

Other tips:

  • Give an example of how you use USDA Rural Housing programs.
    • For example, how much USDA funding did you help families secure last year?
    • How many families became homeowners?
    • How many units of affordable rental housing did you build or preserve?
  • Email them a copy of the Schumer Dear Colleague Letter and NRHC’s Appropriations Request Spreadsheet.
  • Use NRHC Fact Sheets to get more information on USDA Rural Housing programs.
  • Let NRHC know which offices you contacted by emailing Sarah Mickelson (Sarah AT Rapoza DOT Org), so that we can follow up with them.

Congressional Targets

You can find a complete list of NRHC Senate Targets and their staff is here.

To find your Senator’s phone number for their D.C. Office, you can call the Capitol Switchboard at 202-224-3121.

Key Issues

2014 NRHC Budget Bulletins

Key Issues

Ensuring Safe Water and Sewer Services

National Rural Housing Coalition members believe that all rural people — regardless of income — deserve access to basic community services, like safe water and sewer systems. Today, many rural communities have severely limited access to a clean and affordable water supply and are considered to live in “water poverty.”  USDA’s Rural Water and Sewer programs help provide some of the poorest and more remote rural communities with access to such basic services.

Rural Water Sewer Programs

USDA’s Rural Utilities Service (RUS) is the primary federal force in rural water and waste development, providing loans and grants to low-income communities in rural areas. The agency assists low-income rural communities that would not otherwise be able to afford such services. Approximately one-fifth of the communities served live below the national poverty line.

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Key Issues

Supporting Farm Labor Housing

National Rural Housing Coalition members support the U.S. Department of Agriculture’s Section 514/516 Farm Labor Housing programs that aim to improve the quality of life and economic opportunity for America’s rural farmworkers. Today, farmworkers have the worst housing needs of all rural people. More than 60 percent of the 3 million farmworkers in the U.S live in poverty−a rate 5 times the national average. As such, farmworkers must overcome powerful barriers to decent housing, forcing many to live in substandard, crowded conditions.

Section 514/516 Farm Labor Housing Programs

Section 514/516 is the only federal program that provides affordable loans and grants to purchase, construct, or repair housing for America’s farmworkers. Funds may also be used to install necessary facilities, including water and waste disposal systems.

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Key Issues

Promoting Affordable Rental Housing

The National Rural Housing Coalition and our members work to increase access to affordable rental housing in rural America.  We strongly support the Section 515 Rural Rental Housing program as a model for addressing rental housing needs for our most vulnerable residents — low-income families, the elderly, and persons with disabilities.

Section 515 Rural Rental Housing Program

Section 515 is the principal source of financing for rental housing in rural communities. Today, more than 500,000 of America’s most vulnerable families live in housing financed by Section 515. Under the program, housing developers−mostly for-profit entities−compete for 30-year loans at a 1 percent interest rate for the acquisition, rehabilitation or construction of rental housing and related facilities. Section 515 housing is often the only affordable rental housing in rural communities.

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Key Issues

Opportunities for Rural Homeownership

SHH Sen Murray with families at new house at Kipsap EventThe National Rural Housing Coalition and our members strongly support federal programs that protect opportunities for affordable rural homeownership. Two of these programs — the Section 502 Direct Loan program and the Section 523 Mutual Self-Help Housing program — stand out as two of the best ways to meet rural housing needs. By examining the successful track records of thes programs, and by adopting practical measures to expand and improve their performance, our nation can better address the unique housing challenges in rural America.

Like all USDA Rural Housing programs, Section 502 Direct Loans and Section 523 Mutual Self-Help Housing help improve quality of life and economic opportunity in rural America, serving our most vulnerable residents — low-income families, the elderly, and persons with disabilities.


Section 502 Direct Loan Program

Over 60 years, the Section 502 Direct Loan Program has helped more than 2.1 million families realize the American Dream and build their wealth by more than $40 billion. It is the only federal homeownership program that is exclusively targeted to very low- and low-income rural families.

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Section 523 Mutual Self-Help Housing Program

Self-Help Housing is the only federal program that combines “sweat equity” homeownership opportunities with technical assistance and affordable loans for America’s rural families. Self-Help Housing families work nights and weekends to provide 65 percent of the construction labor on their own and each other’s homes. In doing so, families earn equity, decrease construction costs, and make lasting investments in their community.

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Key Issues

Barriers to Affordable Rural Housing

Housing options in rural America are too expensive, are of poor quality, or are inaccessible to many low-income families. Because of higher, more persistent levels of poverty and limited access to affordable mortgage credit, rural communities often struggle to meet the housing needs of its residents.


Barriers to Affordability

Although housing costs are generally lower in rural communities, lower incomes and higher poverty rates make housing options simply unaffordable for many rural residents.

In 2010, rural median incomes ($40,038) were 20 percent lower than the national median income ($50,046), and more than 23 percent less than median urban incomes ($51,998).

In the aftermath of our recent economic crisis, the U.S. poverty rate was at its highest level since 1993 at 15.1 percent. The rural poverty rate was even higher — at 16.5 percent.

It should be no surprise, therefore, that rural communities are four times more likely than urban areas to have at least 20 percent of their population living in poverty.


Poor Quality Housing

Rural low-income families are often limited to poor quality housing. Homes that are available are often in need of extensive repair or improvements to just meet basic health and safety levels. Rural homes are more likely to be in substandard conditions. In fact, nearly six percent of rural homes are either moderately or severely substandard, without hot water, or with leaking roofs, rodent problems, or inadequate heating or plumbing systems.

Recent research confirms the broad health and economic impacts of substandard housing conditions. Poor housing conditions contribute to signficant health problems — including infectious and chronic diseases, injuries, and poor childhood development. Children living in substandard housing are more likely to develop serious illnesses like asthma and lead poisoning, negatively affecting their educational achievement. One study conservatively estimated the cost of illness, disease, and disability attributable to substandard housing at $95 million each year.


Lack of Access to Afforable Credit

The lack of access to mortgage credit severely limits options for decent, clean, and affordable rural housing. Rural communities have more limited access to credit than urban areas. In addition, rural areas experience higher banking concentration than urban areas, resulting in less competition and consumer choice, higher prices, and ultimately, less access to affordable mortgage loans.

Even in those communities that do have a bank presence, however, low-income rural families still struggle to access affordable mortgages. Compared to the U.S. Department of Agriculture’s Rural Housing programs, local banks are often unable to provide low-income borrowers — many of whom do not have enough savings to contribute a large down payment — with the low-cost mortgages they need.