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Housing Trust Fund

The National Housing Trust Fund (HTF) is a new affordable housing production program that will complement existing Federal, state and local efforts to increase and preserve the supply of decent, safe, and sanitary affordable housing for extremely low- and very low-income households, including homeless families.

Statutory Background

The HTF was established under Title I of the Housing and Economic Recovery Act of 2008, Section 1338 (Public Law 110-289).

Program Requirements

States and state-designated entities are eligible grantees for the HTF. Annual formula grants will be made, of which at least 80 percent must be used for rental housing; up to 10 percent for homeownership; and up to 10 percent for the grantee's reasonable administrative and planning costs.

HTF funds may be used for the production or preservation of affordable housing through the acquisition, new construction, reconstruction, and/or rehabilitation of non-luxury housing with suitable amenities. All HTF-assisted units will be required to have a minimum affordability period of 30 years. In the first year of funding, the proposed rule requires that 100 percent of the HTF funds used to produce rental units must benefit extremely low-income families or families with incomes below the poverty line, whichever is greater.

Eligible activities and expenses include:

  • Real property acquisition
  • Site improvements and development hard costs
  • Related soft costs
  • Demolition
  • Financing costs
  • Relocation expenses
  • Operating cost assistance for rental housing (not more than 20 percent of each annual grant)
  • Reasonable administrative and planning costs

Eligible forms of assistance include:

  • Equity investments
  • Interest-bearing loans or advances
  • Non-interest bearing loans or advances
  • Interest subsidies
  • Deferred payment loans
  • Grants
  • Other forms of assistance approved by HUD

To further sustain the affordable housing produced, all newly constructed and "gut" rehabbed HTF-assisted units will be required to meet Energy Star certification standards and include water efficiency features.

Publication of Proposed Formula and Program Rules

HUD has issued the proposed program rule for the HTF as new Subpart N of the HOME Investment Partnerships program regulations (24 CFR Part 92) in an effort to consolidate largely similar programs, improve the coordination of local and regional planning efforts and activity delivery, and reduce the administrative burden placed on grantees overall. All federal requirements that apply on their own terms also apply to the HTF.

On December 4, 2009 (74 FR 63938), HUD published a proposed rule (FR-5246-P-01) for public comment on the formula to be used to allocate HTF funds. HUD is currently reviewing the public comments that were received and the final formula rule will be made part.

The proposed HTF program rule (FR-5246-P-02) was published on October 29, 2010 (75 FR 66978) for public comment on the regulations that will govern the HTF. The comment period will close on December 28, 2010.