Amendment to Increase 202 Housing Funds

Legislation | September 07, 2017 | by Linda Couch

An amendment from Rep. Darren Soto (D-FL) would add $2.5 million to the House omnibus appropriations bill’s $573 million for the Section 202 Housing for the Elderly program, while an amendment from Rep. Glenn Grothman (R-FL) would cut Project-Based Rental Assistance (PBRA) by $266 million for fiscal year 2018. About two-thirds of Section 202 communities receive rental assistance from the PBRA account.

These are two of the several amendments made in order for consideration of the fiscal year 2018 (FY18) omnibus spending package, which includes funding for HUD for the next fiscal year. The HUD bill is one of 12 appropriations bills currently moving through the House floor in the omnibus package. Just back from August recess, the House could begin considering these amendments as early as September 7.

The House Appropriations Committee passed its FY18 HUD spending bill on July 17 The House bill includes sufficient funding to renew all existing Section 202 Project Rental Assistance Contracts and Service Coordinator contracts, as well as authority to expand HUD’s Rental Assistance Demonstration to include Section 202 communities with Project Rental Assistance Contracts.

LeadingAge has been reaching out to House offices in support of Rep. Soto’s amendment and in opposition to Rep. Grothman’s amendment, which would leave HUD with insufficient funds in FY18 to fully renew all PBRA contracts.

In other appropriations news, the House, Senate and White House appear to be near agreement to pass a Continuing Resolution until December 15. A CR is needed keep federal programs funded until Congress can enact final FY18 spending level, something they clearly will not be able to do by the September 30 end of fiscal year 2017.

HUD is not seeking any additional funds for the October 1 – December 15 period for its programs in the CR and assumes its programs can continue without interruption until mid-December. HUD has asked Congress to extend the authorization for its Mark-to-Market program, which will otherwise expire on September 30, 2017. HUD anticipates that 19 communities, representing 3000 apartments, will be eligible for Mark-to-Market restructuring in the first quarter of FY18.

Without this change, according to HUD, “the PBRA properties with expiring contracts and above-market rents would be renewed at market rates, but there would be no authority to restructure/lower their Federal Housing Administration debt. This may lead to financial distress for some properties, such as difficulty servicing the debt or covering operating expenses.”