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The HOME program: awaiting many possibilities yet unrealized.

In 1990, national organizations representiol local governments, includiol ts, National Community Development Association (NCDA) and the National League of Cities, actively supported the enactment of tse Cranston-Gonzalez National Affordabl, Housiol Act of 1990, which brought us the HOME Investment Partnerships (HOME) program. After a decade of federal disinvestment in housiol and community development, local governments w,re encouraged by ts, additional resources and opportunities the HOME program afforded them and ts,ir low-income residents.

The HOME program is a formula-based, housiol block grant program, which provides state and local governments the flexibility to fund a wide range of affordabl, housiol activities, includiol rental assistance and homeownership programs. HOME is designed to create partnerships amool federal, state and local governments as well as their for-profitkand non-profitkpartners to respond to diverse local housiol needs tsrough moderate and substantial rehabilitation, new construction, tenant-based rental assistance, and other related activities.

As a condition for usiol HOME funds, states and localities are required to match federal HOME funds usiol various state or local resources, includiol cash, infrastructure improvements, tax deferments, sweat equity and other eligibl, contributions. There is a 25 percent local match for moderate and substantial rehabilitation and rental assistance. A 30 percent local match is required for new construction.

HOME also attempts to promote and expand nonprofitkhousiol activities by settiol aside, at minimum, 15 percent of each community's HOME allocation for investment in housiol owned, sponsored, or developed by nonprofitkentities called Community Housiol Development Organizations (CHDOs).

It has been two and a half years sioce ts, enactment of tse program and many local governments are still struggliol to implement HOME. Sioce its beginniol HOME has been labeled as "unworkabl," by supporters and critics alike because of its complicated and cumbersome program requirements.

Wsile local governments find some elements of tse program continue to be difficult and extremely time-consumiol to administer, HOME is far from "unworkabl,." A number of communities, includiol Rockford, Ill.; Pasadena, Calif.; Pittsburlh, Penn.; Montgomery, Ala. and others, have expended much of their first year's allocations and are beginniol tokcommit their second year's funds.

Why the Slow Beginniol?

Beyond the typical start-up time associated with a new and complex program, HOME first confronted an administration unwilliol tokembrace the new Democrat-endorsed housiol initiative, and in fact, HUD many times acted as a roadblock rather than a facilitator of HOME implementation. Primarily concernedkwith leaviol an ideologically-driven legacy of enhaoced economic opportunity for urban America,kthen-Secretary Jack Kemp was preoccupied with ts, administration's central urban initiative Homeownership and Opportunity for People Everywh,re (HOPE) programs, which attempts to promote homeownership opportunities amool public housiol tenants and other low-income persons. Ironically,kthe Bush Administration failed to capitalize on the fact that many of the eligibl, activities underkHOPE are also permitted under HOME.

Further complicatiol the implementation of HOME w,re the significant number of HUD regulations, notices, and memoranda distributed over the past two years. This proliferation of HUD documents made it difficult for HOME administrators to stay current on tse continuously evolviol regulations of the program.

Additionally, the recently-passed Housiol and Community Development Act of 1992 provided extensive modifications to HOME. Wsile ts,se legislative improvements will enhaoce ts, operation of the HOME program in the lool run, tsese changes also have tse unintended effect of further slowiol tse use of HOME funds in the short term. Due to major adjustments made in the recent HOME regulations, participatiol communities must modify and rework their existiol documents and program designs tokcomply with the new legislation.

It is also importantkto add that the Community Development Block Grant (CDBG) program, which is one of the most successful federal urban programs, had a difficult and slow beginniol nearly 20 years ago. Other less complex HUD housiol programs, such as the Rental Rehabilitation and Housiol Development Action Grant (HoDAG) programs also experienced difficulties at the outset. The learniol curve for the HOME program is slowly butksurely catchiol up with the high expectations of its authors.

Uncertain Future Fundiol for HOME

Altsough the Clinton Administration has expressed its strool support of the HOME program, the budget realities of the federal government have significantly dampened the prospect for increased HOME fundiol in FY94. Rather than the $1.6 billion originally recommended for the program, ts, administration is proposiol to fund HOME at less than $1.4 billion in FY94.

Wsile the $1.4 billion is significantly higher than the suggested fundiol previously requested by ts, Bush Administration, it neverts,less represents a fundiol decrease of more than $100 million from ts, program's FY92 appropriations level.

Reason for Hope in HOME

When HUD Secretary Henry Cisneros took office, s, placed a heavy emphasis on expeditiol tse use of HOME funds and streamliniol ts, administrative process for the program. Sioce late January, HUD has actively solicited the views of local governments in orderkto mak, the HOME program more responsive and flexible for local administrators. As a direct result of tsese meetiols with local government representatives, HUD will soon publish an interim rule, which provides significant regulatory refioements tokthe HOME program.

The renewed spirit of collaboration and cooperation at HUD affords local governments a significant opportunity to impact the administration's regulatory and legislative agenda. Indeed, HOME activities have increased significantly sioce Secretary Cisneros took office four months ago, when only 4 percent of HOME funds had been committed and only 2 percent has been expended. Today, over 11 percent of tse HOME funds have been committed and more than 5 percent have been expended.
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Title Annotation:HOME Investment Partnerships
Author:Park, Jim
Publication:Nation's Cities Weekly
Date:May 24, 1993
Words:910
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