Congress, with one giant bill, has finished all its work for 2020 (with one significant exception – see below). The “omnibus” included all the regular discretionary spending bills for FY 2021; about $900 billion in emergency coronavirus relief spending; and any number of pieces of legislation that were added on for an easy ride through the process. Below is a summary of some of the things in the recently-passed omnibus bill that are most important to homelessness.
Emergency Funding
The big news here is $25 billion for rental assistance proposed in the omnibus. This money will be distributed by the Treasury Department, to state and local governments, who will set up mechanisms to pay landlords and utility companies (or pay tenants if their landlords or utility companies decline to participate). Ten percent of the funding can be used by state/local government for administration. Of the program funding, at least 90 percent must be used for rent or utility payments (accrued or prospective). The remaining 10 percent can be used for “other housing-related expenses” including case management. Any household can receive an initial 12 months of rent, and possibly one additional month.
The bill also includes one-time cash payments and additional unemployment benefits, which could help people who are homeless or in danger of becoming homeless. These payments are less than the ones distributed under the CARES Act.
This bill does not include any additional Emergency Solutions Grants (ESG) money specifically for homelessness programs. Much of that funding from the CARES Act remains unspent, and decisionmakers chose to wait to provide additional amounts. The Alliance would like to hear specifically from communities that have spent most or all of their CARES Act ESG funding, to build the case for more. Please reach out to Steve Berg (sberg@naeh.org) if your community has already spent the majority of these funds.
Regular Funding
The U.S. Department of Housing and Urban Development (HUD) Homeless Assistance account received a healthy increase of $223 million from the omnibus, bringing the account up to $3 billion total. This is the largest one-year increase since the early 1990s when the HUD McKinney programs were first being scaled up. It is a huge credit to people around the country who work hard to make these programs as effective as possible, and who share news about their needs with people in Congress. The new money will ensure that housing programs can keep up with rising rents. It will provide specific new funding for additional programs for homeless youth, and for domestic violence survivors. There will probably be money for other capacity expansion, but that will depend on rental markets when these funds are distributed in early 2022.
The omnibus also provides new “Section 8” Housing Choice Vouchers to combat homelessness. Additional vouchers for homeless veterans (HUD-VASH) receive $40 million; and other new vouchers targeted to people who are homeless, or at risk of homelessness, receive $43 million. In both cases the expectation is that the housing vouchers will be coordinated locally with health care and other supportive services. This total of $83 million will fund rent for approximately 10,000 people.
The Alliance will soon have more comprehensive information available on our website about funding levels for other homelessness programs.
Policy Changes
CoC NOFA
The bill provides that HUD will release FY 2020 Continuum of Care (CoC) funds necessary to renew the previous year’s grants, without the usual competition. Congress provided funding for some new CoC programs, and that will be released through a competitive Notice of Funding Availability (NOFA).
Tribes and CoC
Native American tribes and tribally-affiliated housing organizations will be eligible for Continuum of Care funding through the usual process. The Alliance is particularly interested in helping communities make this new authority work, and would like to hear from tribal governments or CoCs that are interested in applying for CoC funds.
LIHTC
The Low-Income Housing Tax Credit (LIHTC) was changed to expand the “4% rate:” a complicated issue, but one that will make it easier to use LIHTC to develop housing for people with lower incomes.
Defense Authorization and HUD-VASH
The one big piece of business Congress is still contemplating is trying to override the threatened veto of the National Defense Authorizing Act. In most years, people working on homelessness pay attention to this bill only as an indication of how much the US has to spend and how comparatively small our asks for homelessness are.
This year, tucked away in the bill is a provision making homeless veterans with an “other than honorable” (OTH) discharge status eligible for the HUD-VASH program. (Please note that an OTH discharge status is not the same thing as a dishonorable discharge status.) This is an important provision that the Alliance has work hard have included over the past year; veterans with OTH status often face significant obstacles that can put them at risk of long-term homelessness.
Looking to the Future
These investments are much-needed in a time where Continuums of Care have been repeatedly noting the need for increased resources over the course of the COVID-19 pandemic. These newly allocated funds – both for regular FY2021 spending and COVID-19 relief – will prove critical for homeless service providers to serve people experiencing homelessness. As more information becomes available on how to best spend these funds, the Alliance will provide guidance to the field.
There is much to look forward to in 2021, and much work to be accomplished to end homelessness. But by working together, and using these new funds to the fullest capacity, we can continue to serve people experiencing homelessness in a time where housing is more important than ever.