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Citizens' Housing and Planning Association: November 30, 2011

November 30, 2011

Publication Date: 
Wednesday, November 30, 2011

State Updates

Patrick-Murray Administration Releases FY2012 Capital Plan

On November 17, the Patrick-Murray Administration released the FY’12 capital budget. The budget provides a very small increase over last year’s capital budget for housing.  Last year, the Housing Innovations Fund - a program that primarily funds housing developments that serve homeless families and individuals - was cut from $9 million to $6 million. This year, HIF is funded at $8 million. 

The Affordable Housing Trust Fund, Housing Stabilization Fund, Public Housing Modernization, Capital Improvement and Preservation Fund, Community Based Housing, Facilities Consolidation Fund, and Housing at Transit Nodes program are all level-funded and the Transit Oriented Development program has been consolidated into MassWorks.  CHAPA has advocated for restoring funding to the $193 million allocated to affordable housing capital programs three years ago.

Patrick-Murray Administration, Legislature Looking to Revise HomeBase Program

On November 11th, Governor Patrick approved a supplemental budget that provides funding for HomeBase and Emergency Assistance to assist homeless families, while restricting the ability to access HomeBase rental assistance to families in Emergency Assistance-funded programs or HPRP prior to October 28th, 2011.  The bill also establishes a December 9th deadline for the Administration and Legislature to work together to devise additional revisions and cost controls. 

Given the high demand from families at-risk of homelessness and the current fiscal constraints, CHAPA is advocating for FY’12 HomeBase changes that reflect the following goals: 1) Focus FY’12 HomeBase rental assistance on rehousing homeless families in shelter or motels prior to November, 2) Continue to provide homeless families with a choice to access flexible household assistance or Emergency Assistance shelter, 3) Make flexible household assistance available to families exiting shelter, and 4) Keep HomeBase rental assistance closed at the front-door of shelter throughout the remainder of FY’12. 

We are also soliciting input on how to effectively serve families at-risk of homelessness, experiencing homelessness, or exiting homelessness with limited resources for housing and homelessness assistance in FY2013.  Please email any suggestions to scaron@chapa.org

Building Blocks Coalition Establishes FY2013 State Budget Priorities

The Building Blocks Coalition, a coalition of affordable housing and homelessness prevention organizations convened by CHAPA, has established the list of FY’13 state budget requests the groups will work together to advocate for in the coming year. 

The group will seek $44.3 million for MRVP, $71 million for state public housing operations, $4.5 million for Alternative Housing Voucher Program, $5.5 million for RAFT homelessness prevention, $3 million for Housing Consumer Education Centers, $500,000 for the Tenancy Preservation Program, $4 million for Home and Healthy for Good, $80,000 for the Mass Access Affordable Housing Registry and $2 million in dedicated funding for Foreclosure Prevention counseling.

The Patrick-Murray Administration is currently soliciting input on its FY’13 House Two budget proposal, which is slated to be released January 25th

Legislature Recesses for Holidays; Key Housing Priorities Left for 2012

The State Legislature recessed from full formal sessions on November 16th and will return in January.  The Legislature completed work on a variety of high profile bills, including legislation expanding gambling in Massachusetts, which surprisingly did not include funding for the Community Preservation Act State Trust Fund.  The Legislature did not focus on bills to expand affordable housing in the flurry of activity, but did complete a supplemental budget to bolster Emergency Assistance and HomeBase. 

Non-controversial legislation can advance during the holiday recess and CHAPA is advocating for An Act Relative to Community Housing and Services to clear the House and be sent to the Governor for approval in December.  The proposal cleared the Senate unanimously earlier this year and would lead to 1,000 new units of supportive housing under a more efficient process to develop these critical opportunities for seniors, persons with disabilities, veterans and people exiting homelessness.

Sen. Chandler’s and Rep. Sanchez’s Public Housing Innovations bill and the Supportive Housing bill remain our top two legislative priorities, followed closely by zoning and land use reform, legislation to bolster the Community Preservation Act, legislation to improve accessibility requirements in multifamily construction, and a proposal to secure Green Communities Act funding to improve energy efficiency in multifamily affordable housing.  The two-year legislative session ends on July 31, 2012.  

Northampton Voters Reject Community Preservation Act Repeal

By a margin of 6,204 to 2,732, better than 2 to 1, voters in Northampton rejected an attempt to revoke the town’s adoption of the Community Preservation Act.  The City subsequently received an increase in bond rating that was partially attributable to the CPA vote.  HAPHousing, Valley CDC, and the Pioneer Valley Habitat for Humanity have all accessed significant CPA resources in Northampton to expand affordable housing opportunities.

DHCD Issues Guidelines on Community Development Corporation Certification

M.G.L. Chapter 40H creates a new definition for the term “Community Development Corporation” and establishes a certification program for CDCs.  DHCD has established guidelines and forms to facilitate the new process available on their website. 

Federal Updates

HUD FY2012 Budget Finalized with Deep Cuts to HOME and Public Housing

HUD’s FY2012 budget was signed into law on November 18 as part of a minibus bill.  The final bill (H.R. 2112) reduces HUD’s budget by 9% ($3.7 billion), almost twice the cut from FY2011 discretionary non-security spending required by the Budget Control Act.  

It cuts several programs deeply, including HOME (-37.8%), the Public Housing Capital Fund (-14%) and CDBG formula grants (-11.6%).  It also appears to fall slightly short of fully funding Section 8 housing choice vouchers.  It provides $45 million for Housing Counseling and level funds homeless assistance.  Section 811 funding was also cut but the program is expected to double the number of households it assists by funding project-based rental assistance rather than construction. 

The final bill retained a number of important policy provisions and left out several harmful proposals.  It does not include the ban on federal funding for federalized public housing.  It does include language authorizing the “Rental Assistance Demonstration” (RAD) enabling voluntary conversion of up to 60,000 public housing and Mod Rehab units to project-based rental assistance to help owners finance capital improvements.  The final bill dropped the cost-saving administrative reforms to the Housing Choice Voucher program that the Senate had approved.  See CHAPA’s website for more detailed information on funding levels and the budget language.

HUD Awards $2.9 million in Sustainable Communities Grants to Massachusetts

On November 21, HUD awarded $96 million in Sustainable Communities grants nationwide (27 Community Challenge grants and 28 Regional Planning grants. 

Massachusetts applicants won three Community Challenge grants totaling over $2.9 million.  The City of Boston will receive $1,865,160 for the Fairmount Line Smart Growth Corridor project, the City of Worcester will receive $930,000 for the Main South to Loomworks revitalization project, and the Montachusett Regional Planning Commission will receive $129,500 to develop and complete a Smart Growth Corridor plan around the planned Wachusett Station passenger rail stop. Click here for details on the proposed activities. 

Community Challenge grants address local challenges to integrating transportation and housing and may include activities to support mixed-use development, affordable housing and the re-use of older buildings, retrofitting main streets to provide safer routes, and preserving affordable housing and local businesses near new transit stations.

OCC Issues Status Report on Fixing Deficient Foreclosure Procedures

On November 22, the Office of the Comptroller of the Currency issued an “interim status report” on the extent to which 12 national bank and federal savings association mortgage servicers are complying with consent orders issued in April to correct deficient servicing and foreclosure practices. 

Among other things, it reports that the servicers began contacting borrowers who may have been victims of servicer “misfeasance” to let them know they are entitled to a review of their case if they were in any stage of foreclosure between January 1, 2009 and December 31, 2010.  OCC has also set up a website with information on the review process.

CFPB Posts Simplified Mortgage Disclosure Forms for Comment

On November 8, the Consumer Financial Protection Bureau (CFPB) posted two versions of latest draft of a simplified mortgage disclosure form.  It is seeking feedback online from consumers.  One version, nicknamed Hornbeam, is five pages and the other, nicknamed Ironwood, is six pages.

New HUD Notice Allows Non-Profits to Retain Sale Proceeds in Preservation Transactions

On November 14, HUD issued a new Notice (H 2011-31) that will allow non-profit owners of older properties with subsidized FHA-insured or HUD-held mortgages to keep the sales proceeds if they sell the property to a buyer who agrees to long term use restrictions (at least 20 years beyond original maturity date).  The ban on retaining proceeds had made many non-profit owners reluctant to enter a preservation sale prior to the maturity of the original mortgage.  The Notice applies to prepayment requests going forward.  Click here for a summary of key provisions.

HUD Issues Proposed Fair Housing Rule on “Disparate Impact”

On November 16, HUD issued a proposed rule to establish a uniform legal approach to determining when a housing practice has a disparate impact.  Comments are due by January 17.

On November 18, Housing Wire reported that the Supreme Court will be hearing a challenge to the concept of disparate impact as a Fair Housing Act violation.  The case was brought by a group of landlords in St. Paul who sued city inspectors claiming that overly aggressive code enforcement activities had a disparate impact on low income and minority renters.  Housing Wire reports that the Court agreed to decide two questions: whether disparate impact claims may be brought under the Fair Housing Act and, if so, what is the appropriate legal test for analyzing such claims.

 Senate Republican Bill Would Phase Out GSEs

On November 9, Senator Robert Corker (R-Tenn) of the Senate Committee on Banking, Housing and Urban Affairs introduced a bill (the Residential Mortgage Market Privatization and Standardization Act of 2011 [S.1834]) to phase out Fannie Mae and Freddie Mac over 10 years by reducing their guarantee (in year 1, they could only guarantee 90% of a bond, in year 2, no more than 80%, etc.  The bill does not create any replacement entity.  As detailed in the bill summary, it would also:

  • Replace the QRM standard with one requiring a minimum 5% downpayment and full, uniform documentation; allow a waiver of 5% minimum on loans originated by approved nonprofits;
  • Create a new public database on all federally regulated single- and multi-family mortgages, with detailed information on loan characteristics, terms, lender, and property address, and for multifamily loan, details on use of total units, occupancy status, rents and use of rent subsidies; 
  • Replace MERS with an FHFA-regulated national database for all mortgage title transfers;
  • Create uniform servicing standards (a uniform pooling and servicing agreement) for securitized mortgages, based on current GSE pooling and servicing agreements, and uniform loss mitigation procedures including a single point of contact, a national Net Present Value (NPV) model, and “national standards for the foreclosure process.”

The bill, which has no co-sponsors yet, incorporates elements from a number of the many GSE reform bills filed this year.