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Notes
The same deductions from income are used to define adjusted income for both the LRPH program and the Section 8 program.
The limit (as a deductible from gross income) for child support or alimony payments for someone outside of the household is the lesser of (a) the legal limit or (b) $550 for each individual for whom the payment is made.
Wilhelmina A. Leigh and Carla Pedone,The Potential Loss of Assisted Housing Units as Certain Mortgage-Interest Subsidy Programs Mature, Staff Working Paper (Washington, DC: Congressional Budget Office, March 1987), p. 12.
See Leigh and Pedone, pp. 12–13.
Title II of the 1987 Housing and Community Development Act-also known as the Emergency Low Income Housing Preservation Act of 1987-established a procedure requiring advance notification and HUD approval of any proposed prepayment of a mortgage insured by either the BMIR or the Section 236 programs. In Section 221 (General Prepayment Limitation) of Subtitle B (Prepayment of Mortgages Insured Under the National Housing Act) of Title II, a two-year moratorium was established on prepayments. The moratorium resulted because the following conditions were met: If any U.S. or state court invalidates the requirements established by this section, an owner of eligible low-income housing located in the geographic area subject to the jurisdiction of that court may not prepay, and a mortgagee may not accept prepayment of a mortgage on such housing during the two-year period following the date of invalidation. Although Subtitle B was to have been repealed (and the moratorium lifted) on February 5, 1990, two years after the effective date of the 1987 Act, the HUD Reform Act of 1989 extended the date of repeal until September 30, 1990, to afford Congress time to develop a more permanent solution to the problem. That more permanent solution was provided in Subtitles A and B of Title VI (Preservation of Affordable Rental Housing) in the Cranston-Gonzalez National Affordable Housing Act (P.L. 101-625). This title is known as The Low-Income Housing Preservation and Resident Homeownership Act of 1990 (LIHPRHA). The LIHPRHA applies to Section 221 (d)(3) BMIR projects; Section 221 (d)(3) projects with rent supplement or Section 8; Section 236 projects; and HUD-held projects formerly insured under those programs that, under pre-February 5, 1988 contracts or regulations, are eligible for prepayment without HUD approval within 24 months. The Act establishes fair market value incentives for owners to retain their projects as low-income housing and a fair market price for owners to sell their projects as low-income housing. If no willing or able purchaser is found for a given project, owners would be allowed to prepay. Incentives for owners to retain projects as low-income housing include: providing greater access to residual receipts; providing increased rents; and financing capital improvements through the flexible subsidy program.
See Leigh and Pedone, p. 12.
See Leigh and Pedone, p. 12–13.
Section 125 in Subtitle B (Management Reform) of Title I (Reforms to Department of Housing and Urban Development) of P.L. 101-235 (Department of Housing and Urban Development Reform Act of 1989) authorizes the HUD Secretary to insure refinanced Section 235 mortgages. Because this measure is intended to reduce federal expenditures in this program, by refinancing mortgages initially made at higher rates in a lower-interestrate environment, the Secretary also is authorized to provide financial incentives to the borrowers to encourage refinancing. The 1990 Appropriations Act for the Departments of Veterans Affairs (VA) and Housing and Urban Development (HUD), and Independent Agencies (P.L. 101-144) provided similar authority for the HUD Secretary to periodically review each Section 235 assistance payments contract to determine if refinancing the mortgage, loan, or advance of credit would result in sufficient savings to the federal government to warrant the refinancing. Financial assistance to encourage refinancing would include such things as the payment of reasonable mortgage or loan origination fees, discount points, and other refinancing expenses, or the payment of an amount less than or equal to 1 percent of the principal refinanced.
Title V (Community Development and Miscellaneous Programs), Subtitle A (Community And Neighborhood Development and Preservation), Section 510 (Limited New Construction of Housing Under the CDBG Program) of the 1987 Housing and Community Development Act added substantial reconstruction as a new category of eligible activity under the CDBG program. Substantial reconstruction can take place with housing owned and occupied by low- and moderate-income persons under the following circumstances: (1) if the need for reconstruction was not determinable until after rehabilitation under this section had begun; or (2) if the reconstruction is part of a neighborhood rehabilitation effort and the grantee (a) determines that the housing is not suitable for rehabilitation and (b) demonstrates to the satisfaction of the HUD Secretary that the cost of substantial reconstruction is much less than the cost of new construction and less than the fair market value of the property after substantial reconstruction.
The 1987 Housing and Community Development Act increased the targeting percentage from 51 to 60 percent, while the 1990 Cranston-Gonzalez National Affordable Housing Act increased this figure to 70 percent.
Whichever is filed-the CHAS or the HAP-must be approved by the HUD Secretary before CDBG funds can be awarded. See Title IX, Subtitle A, Section 905 of the Cranston-Gonzalez National Affordable Housing Act (P.L. 101-625).
Congress, House, Committee on Banking, Finance and Urban Affairs, Subcommittee on Housing and Community Development,Discrimination in Federally Assisted Housing Programs, report on “Subsidized Housing and Race,” prepared by the Office of General Counsel, U.S. Department of Housing and Urban Development, 99th Cong., 1st sess., 1985, Part I, Serial No. 99-83, p. 104.
The 1983 Housing and Urban-Rural Recovery Act repealed the authorizations for the Section 8 new construction and substantial rehabilitation programs, except in conjunction with Section 202 housing for the elderly and handicapped.
Because of irregularities and scandals recently uncovered with respect to the Moderate Rehabilitation program, several measures were taken that led to termination of program funding except for SRO units for the homeless. In April 1989, HUD canceled a funding round for the Moderate Rehabilitation program and requested that in 1990, all funds be devoted to disaster relief efforts. The Appropriations Committee (1990 Appro-priations Act for the Departments of VA and HUD, and Independent Agencies) approved the use of 70 percent of the Moderate Rehabilitation funding for disaster assistance programs but required that the remaining 30 percent be used for SRO units for the homeless. Funding for these SRO units was to be administered according to the reforms of the Moderate Rehabilitation program made in Title I, Subtitle B (Management Reform), Section 127 (Reform of the Moderate Rehabilitation Program) of the HUD Reform Act of 1989 (P.L. 101-235). Changes would require a minimum expenditure of $3,000 per unit; require the HUD Secretary to take into account the existence of tax credits on Moderate Rehabilitation projects and to reduce Moderate Rehabilitation assistance accordingly; and prohibit assistance to any project of more than 100 units.
The initial maximum terms under the Section 8 subprograms were: five years for vouchers; fifteen years for existing-housing and moderate rehabilitation; and either twenty, thirty, or forty years for new construction and substantial rehabilitation, depending on the type of project financing. Section 8 existing-housing certificates now are issued for five-year terms, per the HUD-Independent Agencies Appropriations Act (P.L. 100-404).
For example, tenants of public housing projects that are sold or demolished, and tenants displaced from Section 8 projects when their owners fail to renew their contracts also are eligible to receive vouchers.
These preference rules for project occupancy were established by Title V, Section 501 of the Cranston-Gonzalez National Affordable Housing Act (P.L. 101-625).
Section 143 of Subtitle A in Title I (Housing Assistance) of the 1987 Housing and Community Development Act. Prior to passage of this Act, voucher assistance payments could be adjusted only twice during their five-year term.
See Title VI of the Housing and Community Development Act of 1987 (P.L. 100-242) for the language that authorizes the Nehemiah Housing Opportunity Grants Program.
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Glossary. Rev Black Polit Econ 19, 241–253 (1991). https://doi.org/10.1007/BF02895346
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DOI: https://doi.org/10.1007/BF02895346