DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Federal Funds

For [assistance to convert]conversion of properties [with contracts for project-based assistance] assisted under section [8]9 of the U. S. Housing Act of 1937, (hereinafter, "the Act"), the moderate rehabilitation program, the rent supplement program under section 101 of the Housing and Urban Development Act of 1965, or the rental assistance program under section 236(f)(2) of the National Housing Act, [or for assistance under section 9 of the U.S. Housing Act of 1937,] to properties with assistance under section 8(o)(13) of the [U.S. Housing] Act [of 1937, as amended, and for fees to cover the costs of administration of such new assistance contracts, services to promote resident mobility, and for one-time expenses of combining administrative components of local programs]or to other project-based rental assistance under section 8[(o)] of the [U.S. Housing] Act[of 1937], including the cost of administrative fees of such new assistance contracts and any supplemental costs of the first year of assistance through such procedures as the Secretary may establish, [$350,000,000]$200,000,000, to be available until September 30, 2015: Provided, That notwithstanding sections 3 and 16 of the Act, the conversion of assistance under this heading shall not be the basis for re-screening or termination of assistance or eviction of any tenant family in a property with assistance converted pursuant to this heading and such a family shall not be considered a new admission for any purpose, including compliance with income targeting requirements[of the amounts made available under this heading, up to 3 percent shall be available to the Secretary for the costs of, including the contracting for, rent comparability studies, evaluation, and technical assistance]: Provided further, That [up to $50,000,000 shall be available for services to promote resident mobility and up-front expenses of public housing agencies related to the transformation of rental assistance under this heading: Provided further, That] the Secretary shall select properties for conversion and award funds for assistance and administrative fees[services and upfront expenses] through a competitive process, except that for conversion of properties assisted[public housing and other multifamily properties owned by public housing agencies that do not administer a program under section 8(o) or of properties assisted] under the moderate rehabilitation program [section 8(e)(2)], the rent supplement program under section 101 of the Housing and Urban Development Act of 1965, or the rental assistance program under section 236 of the National Housing Act, the Secretary may select properties for conversion and award funds [for assistance, services, and upfront expenses] through such other procedure as the Secretary may establish: Provided further, That any procedure established pursuant to the preceding proviso, including the criteria for conversion, shall be published by notice in the Federal Register no later than 15 days before any property is converted[the Secretary shall contract for administration of the rental assistance for any property converted under this heading with a public housing agency that does not own or control the property, directly or indirectly: Provided further, That the conversion of contracts under this heading shall not be grounds to evict tenants or terminate families' rental assistance]: Provided further, That the Secretary may waive, or specify alternative requirements for, any provision of section 8(o)(13) (except for requirements related to fair housing, nondiscrimination, labor standards, and the environment) or any provision that governs the use of assistance from which a property is converted pursuant to this heading or funds made available under the headings of "Public Housing Capital Fund," "Public Housing Operating Fund," and "Project-Based Rental Assistance," under this Act or any prior Act for properties converted under this heading, upon a finding by the Secretary that any such waivers or alternative requirements are necessary for the effective conversion of the contracts provided for under this heading: Provided further, That the Secretary shall publish by notice in the Federal Register any waivers or alternative requirements pursuant to the preceding proviso no later than 10 days before the effective date of such [waiver]notice. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

Over the last 75 years, the Federal Government has invested billions in the development and maintenance of public housing and other multifamily rental housing. This housing serves a vulnerable population, including extremely low-income families, seniors, and people with disabilities, who rely on it and have few if any equally affordable housing options. To preserve this large Federal investment and respond to the growing demand for affordable rental housing, the Administration proposes $200 million for a Transforming Rental Assistance (TRA) demonstration. This initiative will help preserve the HUD-assisted inventory by leveraging private financing for capital improvements and by offering a more attractive renewal option to private owners who otherwise may choose to opt-out of HUD's rental assistance programs.

The public housing inventory has an estimated capital needs backlog of $20 to $30 billion. Given current fiscal constraints, the Administration supports alternative means, other than direct capital grants, for addressing this large backlog. Beyond the public housing stock, the Section 8 Moderate Rehabilitation (25,000 units), Rent Supplement (12,700 units), and Rental Assistance Payment (12,900 units) programs either do not offer owners the option to renew their subsidy contracts upon expiration, thereby risking the loss of affordable housing units tied to those contracts, or do not allow owners to renew on terms that attract sufficient capital to preserve long-term affordability.

To begin to address these preservation challenges, the Budget proposes a demonstration and rigorous assessment of the conversion of up to 263,000 units under the Public Housing, Moderate Rehabilitation, Rent Supplement, and Rental Assistance Payment programs to long-term Section 8 rental assistance contracts or project-based vouchers. This demonstration will test TRA conversions as a tool for: (1) preserving public housing and other HUD-assisted units by, among other features, increasing access to private capital and management techniques; (2) creating mixed-income communities; and (3) increasing housing choice for residents.

Participation in the TRA demonstration will be voluntary, with properties primarily selected for conversion by competition. HUD intends through the conversion process to assure the physical and financial sustainability of properties and enable owners to leverage private financing to address immediate and long-term capital needs and implement energy-efficiency improvements. Residents of converted properties, should they opt to move, will have access to tenant-based rental assistance as it becomes available (i.e., the resident choice option) without reducing the number of units with project-based assistance. The Department will conduct an assessment of the demonstration focusing on the following: (1) characteristics of properties selected through the competition; (2) impacts of TRA policies, including rent setting and the resident choice option, on converted properties and residents; (3) the amounts and sources of private financing leveraged for rehabilitation; and (4) HUD capacity to implement conversions.

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For activities and assistance for the provision of tenant-based rental assistance authorized under the United States Housing Act of 1937, as amended (42 U.S.C. 1437 et seq.) ("the Act'' herein), not otherwise provided for, [$15,550,663,183]$15,222,569,082, to remain available until [September 30, 2013]expended, shall be available on October 1, [2010]2011 (in addition to the $4,000,000,000 previously appropriated under this heading that will become available on October 1, [2010]2011), and $4,000,000,000, to remain available until [September 30, 2014]expended, shall be available on October 1, [2011]2012: Provided, That of the amounts made available under this heading are provided as follows:

(1) [$17,310,000,000]No less than $17,143,836,548 shall be available for renewals of expiring section 8 tenant-based annual contributions contracts (including renewals of enhanced vouchers under any provision of law authorizing such assistance under section 8(t) of the Act) and including renewal of [other special purpose]incremental vouchers[initially funded in fiscal years 2009 and 2010 (such as Family Unification, Veterans Affairs Supportive Housing Vouchers and Non-elderly Disabled Vouchers)]: Provided, That notwithstanding any other provision of law, from amounts provided under this paragraph and any carryover, the Secretary for the calendar year [2011]2012 funding cycle shall provide renewal funding for each public housing agency based on validated voucher management system (VMS) leasing and cost data for the prior calendar year [2010] and by applying [the most recent Annual Adjustment Factor]an inflation factor as established by the Secretary by notice published in the Federal Register, and by making any necessary adjustments for the costs associated with the first-time renewal of vouchers under this paragraph including tenant protection, and HOPE VI vouchers: Provided further, That public housing agencies participating in the Moving to Work (MTW) demonstration shall be funded pursuant to their MTW agreements: Provided further, That the Secretary may offset public housing agencies' calendar year [2011]2012 allocations by the excess amount of agencies' net restricted assets accounts as established by the Secretary by notice published in the Federal Register: Provided further, That MTW agencies may also be subject to an offset, as determined by the Secretary, from the agencies' calendar year 2012 Moving to Work funding allocation: [Provided further, That the Secretary shall determine the excess amount of net restricted assets in accordance with authorizing law or by notice in the Federal Register, but in no instance shall the definition of "excess" be greater than the amount above 6 percent of the renewal funding an agency is eligible to receive, prior to proration, in calendar year 2011:] Provided further, That the Secretary shall use any such offset to first avoid or reduce the proration of renewal funding allocations and then on the basis of need and performance, as established by the Secretary by notice published in the Federal Register: [Provided further, That if funds remain after providing public housing agencies with 100 percent of the allocation due under the first proviso, the Secretary may reallocate reserves for purposes otherwise authorized by law or as otherwise provided in a Federal Register notice:] Provided further, That the Secretary shall, to the extent necessary to stay within the amount specified under this paragraph, pro rate each public housing agency's allocation, including MTW agency allocations, otherwise established pursuant to this paragraph: Provided further, That except as provided in the following provisos, the entire amount specified under this paragraph shall be obligated to the public housing agencies based on the allocation and pro rata method described above, and the Secretary shall notify public housing agencies of their annual budget not later than 60 days after enactment of this Act: Provided further, That the Secretary may extend the 60-day notification period with prior written notice to the House and Senate Committees on Appropriations: [Provided further, That public housing agencies participating in the Moving to Work demonstration shall be funded pursuant to their Moving to Work agreements and shall be subject to the same pro rata adjustments under the previous provisos:] Provided further, That up to [$150,000,000]$135,000,000 shall be available only: (1) to adjust the allocations for public housing agencies, after application for an adjustment by a public housing agency that experienced a significant increase, as determined by the Secretary, in renewal costs of tenant-based rental assistance resulting from unforeseen circumstances or from portability under section 8(r) of the Act; (2) for adjustments for public housing agencies with voucher leasing rates at the end of the Calendar Year that exceed the average leasing for the 12-month period used to establish the allocation; ([2]3) for vouchers that were not in use during the 12-month period in order to be available to meet a commitment pursuant to section 8(o)(13) of the Act; ([3]4) for any increase in the costs associated with deposits to family self-sufficiency program escrow accounts; [(4) for onetime adjustments of renewal funding for Public Housing Agencies in receivership with approved fungibility plans for calendar year 2009 as authorized in Section 11003 of the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009 (Public Law 110–329); or] (5) to adjust allocations for public housing agencies to prevent termination of assistance to families receiving assistance under the disaster voucher program, as authorized by Public Law 109–148 under the heading "Tenant-Based Rental Assistance"; (6) for adjustments for the costs associated with HUD-Veterans Affairs Supportive Housing (HUD-VASH) vouchers; (7) for adjustments for public housing agencies that experienced a significant increase, as determined by the Secretary, in renewal costs as a result of participation in the Small Area Fair Market Rent Demonstration: Provided further, That the Secretary shall allocate amounts under the previous proviso based on need as determined by the Secretary;

(2) [$125,000,000]$75,000,000 shall be for section 8 rental assistance for relocation and replacement of housing units that are demolished or disposed of pursuant to [the Omnibus Consolidated Rescissions and Appropriations Act of 1996 (Public Law 104–134)]Section 18 of the Act, conversion of section 23 projects to assistance under section 8, the family unification program under section 8(x) of the Act, relocation of witnesses in connection with efforts to combat crime in public and assisted housing pursuant to a request from a law enforcement or prosecution agency, enhanced vouchers under any provision of law authorizing such assistance under section 8(t) of the Act, HOPE VI vouchers, mandatory and voluntary conversions, and tenant protection assistance including replacement and relocation assistance or for project based assistance to prevent the displacement of unassisted elderly tenants currently residing in section 202 properties financed between 1959 and 1974 that are refinanced pursuant to Public Law 106–569, as amended, or under the authority as provided under this Act: Provided further, That when a public housing development is submitted for demolition or disposition under Section 18 of the Act, the Secretary may provide section 8 rental assistance when the units pose an imminent health and safety risk to residents;

(3) [$1,791,000,000]$1,647,780,434 shall be for administrative and other expenses of public housing agencies in administering the section 8 tenant-based rental assistance program, of which up to $50,000,000 shall be available to the Secretary to allocate to public housing agencies that need additional funds to administer their section 8 programs, including fees associated with section 8 tenant protection rental assistance, the administration of disaster related vouchers, Veterans Affairs Supportive Housing vouchers, and other incremental vouchers: Provided, That no less than [$1,741,000,000]$1,597,780,434 of the amount provided in this paragraph shall be allocated to public housing agencies for the calendar year [2011]2012 funding cycle based on section 8(q) of the Act (and related Appropriation Act provisions) as in effect immediately before the enactment of the Quality Housing and Work Responsibility Act of 1998 (Public Law 105–276): Provided further, That if the amounts made available under this paragraph are insufficient to pay the amounts determined under the previous proviso, the Secretary may decrease the amounts allocated to agencies by a uniform percentage applicable to all agencies receiving funding under this paragraph or may, to the extent necessary to provide full payment of amounts determined under the previous proviso, utilize unobligated balances, including recaptures and carryovers, remaining from funds appropriated to the Department of Housing and Urban Development under this heading, [for fiscal year 2010 and]from prior fiscal years, notwithstanding the purposes for which such amounts were appropriated: Provided further, That amounts provided under this paragraph shall be only for activities related to the provision of tenant-based rental assistance authorized under section 8, including related development activities;

(4) $60,000,000 shall be available for family self-sufficiency coordinators under section 23 of the Act;

(5) [$113,663,183]$114,046,000 for renewal of tenant-based assistance contracts under section 811 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013), as amended, entered into prior to fiscal year 2007;

(6) Up to [$66,000,000]$50,000,000 for incremental tenant-based assistance for eligible families assisted under the Disaster Housing Assistance Program for Hurricanes Ike and Gustav: Provided, That these vouchers will not be re-issued when families leave the program;

(7) [$85,000,000]$56,906,100 for incremental voucher assistance under section 8(o) of the United States Housing Act of 1937, [including related administrative expenses,] for two competitive demonstration programs to address the needs of families and individuals who are homeless or at risk of homelessness, as defined by the Secretary of Housing and Urban Development, to be administered by the Department of Housing and Urban Development in conjunction with the Department of Health and Human Services and the Department of Education: Provided, That one demonstration program shall make funding available to public housing agencies that: (1) partner with eligible state or local entities responsible for distributing Temporary Assistance for Needy Families (TANF) and other health and human services as designated by the Secretary of the Department of Health and Human Services, and (2) partner with school homelessness liaisons funded through the Department of Education's Education for Homeless Children and Youths program: Provided further, That the other demonstration program shall make funding available to public housing agencies that partner with eligible state Medicaid agencies and state behavioral health entities as designated by the Secretary of the Department of Health and Human Services to provide housing in conjunction with Medicaid case management, substance abuse treatment, and mental health services: Provided further, That the Secretary of Housing and Urban Development shall make the funding specified in this subsection available through such allocation procedures as the Secretary determines to be appropriate, notwithstanding section 213 of the Housing and Community Development Act of 1974 (42 U.S.C. 1439) and section 204 (competition provision) of this title, to entities with demonstrated experience and that meet such other requirements as determined by the Secretary: Provided further, That the Secretary of Housing and Urban Development may waive, or specify alternative requirements for any provision of any statute or regulation that the Secretary of Housing and Urban Development administers in connection with the use of funds made available under this paragraph (except for requirements related to fair housing, nondiscrimination, labor standards, and the environment), upon a finding by the Secretary that any such waivers or alternative requirements are necessary for the effective delivery and administration of such voucher assistance: Provided further, That the Secretary shall publish in the Federal Register the alternative requirements [any] (including waivers of any statute or regulation necessary to establish those alternative requirements) that the Secretary administers pursuant to this subsection no later than 10 days before the effective date of such [waiver]alternative requirements: Provided further, That assistance made available under this subsection shall continue to remain available for these purposes upon turn-over;

(8) $75,000,000 for incremental rental voucher assistance for use through a supported housing program administered in conjunction with the Department of Veterans Affairs as authorized under section 8(o)(19) of the United States Housing Act of 1937: Provided, That, notwithstanding section 204 (competition provision) of this title, the Secretary of Housing and Urban Development shall make such funding available to public housing agencies that partner with eligible VA Medical Centers, or other entities as designated by the Secretary of the Department of Veterans Affairs, based on: (1) geographical need for such assistance as identified by the Secretary of the Department of Veterans Affairs; (2) public housing agency administrative performance; and (3) other factors as specified by the Secretary of Housing and Urban Development in consultation with the Secretary of the Department of Veterans Affairs: Provided further, That the Secretary of Housing and Urban Development, in consultation with the Secretary of the Department of Veterans Affairs, may waive or specify alternative requirements for, any provision of any statute or regulation that the Secretary of Housing and Urban Development administers in connection with the use of funds made available in this paragraph, except for requirements related to fair housing, nondiscrimination, labor standards, and the environment, upon a finding by the Secretary that any such waivers or alternative requirements are necessary for the effective delivery and administration of such voucher assistance provided in this paragraph: Provided further, That assistance made available under this paragraph shall continue to remain available for homeless veterans upon turn-over.

Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The 2012 Budget provides $19.2 billion for the Tenant-Based Rental Assistance Program (also known as the Housing Choice Voucher program). The Housing Choice Voucher program provides housing assistance to over two million extremely low- to very low-income families to rent in the neighborhoods of their choice. This is the Federal government's largest and most income-targeted program for assisting very low-income families to rent decent, safe and sanitary housing in the private market. About 2,400 state and local Public Housing Authorities (PHAs) administer the Housing Choice Voucher program.

In addition to funding vouchers anticipated to be under lease by 2012, the Budget provides new vouchers to make progress on HUD's high priority performance goals for increasing the number of families receiving rental assistance and for reducing the number of homeless veterans. The Budget includes $114 million to renew nearly 15,000 Mainstream vouchers for Housing for Persons with Disabilities previously funded from the Section 811 account; $75 million in new vouchers for homeless veterans through the HUD-Veteran Affairs Supportive Housing (HUD-VASH) program; $60 million to support the Family Self-Sufficiency program; and $57 million in new HUD-Department of Health and Human Services vouchers for homeless and at-risk homeless families with children and persons with disabilities in support of the Federal Strategic Plan to Prevent and End Homelessness. The account also includes $75 million for tenant protection vouchers, which are provided when certain actions occur beyond the control of the residents, such as public housing demolition or disposition, or when landlords terminate their Project-Based Rental Assistance contracts.

The Administration maintains its commitment to continually improve the management of the Housing Choice Voucher program. For 2012, the Administration proposes to: 1) design a comprehensive development strategy to improve HUD information technology systems to better manage and administer the Housing Choice Voucher program, including continued assistance to PHAs to better manage funds and increase leasing rates responsibly; 2) develop an improved Section 8 Management Assessment Program with revised indicators that will strengthen oversight (including possible on-site assessments), improve quality control, and establish performance metrics; 3) continue the study to develop a formula to allocate administrative fees based on the cost of an efficiently managed PHA operating the Housing Choice Voucher program; 4) develop a study to evaluate current housing quality standards and improve the unit inspection process; and 5) eliminate the cap restriction imposed by past Appropriations Acts on the number of families that each PHA may serve.

The 2012 Budget also includes key provisions that improve HUD's three largest rental assistance programs: Housing Choice Vouchers, Project-Based Rental Assistance, and Public Housing. The proposal: 1) broadens the extremely low-income targeting requirement by applying it to families with the higher of 30 percent of Area Median Income or the federal poverty level; 2) increases the standard deduction for elderly and disabled households from $400 to $675 and raises the deduction for excess medical expenses from 3% to 10% of income; 3) streamlines the program by permitting 3 year annual re-certification for fixed-income families; 4) provides PHAs the authority to approve exception rents for disabled voucher households; 5) enables HUD to produce more timely Fair Market Rent data on an annual basis; and 6) authorizes a rent demonstration project.

Unobligated balances, including recaptures and carryover, remaining from funds appropriated to the Department of Housing and Urban Development under this heading, the heading "Annual Contributions for Assisted Housing'' and the heading "Project-Based Rental Assistance'', for fiscal year [2011]2012 and prior years may be used for renewal of or amendments to section 8 project-based contracts and for performance-based contract administrators, notwithstanding the purposes for which such funds were appropriated: Provided, That any obligated balances of contract authority from fiscal year 1974 and prior that have been terminated are hereby permanently cancelled: Provided further, That amounts heretofore recaptured, or recaptured during the current fiscal year, from project-based Section 8 contracts from source years fiscal year 1975 through fiscal year 1987 are hereby permanently cancelled, and an amount of additional new budget authority, equivalent to the amount permanently cancelled is hereby appropriated, to remain available until expended, for the purposes set forth under this heading, in addition to amounts otherwise available. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

Until 2005, the Housing Certificate Fund provided funding to both the project-based and tenant-based components of the Section 8 program. Project-based Rental Assistance and Tenant-based Rental Assistance are now funded in separate accounts. The Housing Certificate Fund retains and recovers balances from previous years' appropriations.

For activities and assistance for the provision of project-based subsidy contracts under the United States Housing Act of 1937 (42 U.S.C. 1437 et seq.) ("the Act''), not otherwise provided for, [$8,982,328,000]$9,035,000,000, to remain available until expended, shall be available on October 1, [2010]2011 (in addition to the $393,672,000 previously appropriated under this heading that will become available October 1, [2010] 2011), and $400,000,000, to remain available until expended, shall be available on October 1, [2011]2012: Provided, That the amounts made available under this heading shall be available for expiring or terminating section 8 project-based subsidy contracts (including section 8 moderate rehabilitation contracts), for amendments to section 8 project-based subsidy contracts (including section 8 moderate rehabilitation contracts), for contracts entered into pursuant to section 441 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11401), for renewal of section 8 contracts for units in projects that are subject to approved plans of action under the Emergency Low Income Housing Preservation Act of 1987 or the Low-Income Housing Preservation and Resident Homeownership Act of 1990, and for administrative and other expenses associated with project-based activities and assistance funded under this paragraph: Provided further, That of the total amounts provided under this heading, not to exceed [$322,000,000]$289,000,000 shall be available for performance-based contract administrators for section 8 project-based assistance: Provided further, That the Secretary of Housing and Urban Development may also use such amounts in the previous proviso for performance-based contract administrators for the administration of: interest reduction payments pursuant to section 236(a) of the National Housing Act (12 U.S.C. 1715z-1(a)); rent supplement payments pursuant to section 101 of the Housing and Urban Development Act of 1965 (12 U.S.C. 1701s); section 236(f)(2) rental assistance payments (12 U.S.C. 1715z-1(f)(2)); project rental assistance contracts for the elderly under section 202(c)(2) of the Housing Act of 1959 (12 U.S.C. 1701q); project rental assistance contracts for supportive housing for persons with disabilities under section 811(d)(2) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013(d)(2)); project assistance contracts pursuant to section 202(h) of the Housing Act of 1959 (Public Law 86–372; 73 Stat. 667); and loans under section 202 of the Housing Act of 1959 (Public Law 86–372; 73 Stat. 667): Provided further, That amounts recaptured under this heading, the heading "Annual Contributions for Assisted Housing'', or the heading "Housing Certificate Fund'' may be used for renewals of or amendments to section 8 project-based contracts or for performance-based contract administrators, notwithstanding the purposes for which such amounts were appropriated. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Budget requests $9.4 billion for project-based rental assistance, of which $400 million is requested as an advance appropriation to become available in 2013.

The Project-Based Rental Assistance program assists approximately 1.3 million extremely low- to low-income households in obtaining decent, safe, and sanitary housing in private accommodations. Project-based rental assistance serves families, elderly households and disabled households and provides transitional housing for the homeless. Through this funding, HUD supports approximately 18,000 contracts with private owners of multifamily housing by paying the difference between what a household can afford, generally 30 percent of its eligible income, and the approved market-based rent for a housing unit. Program activities include the following:

Contract Renewals and Amendments.— These activities provide funding for HUD to renew expiring contracts and amend contracts that have not expired but require additional funding for HUD to meet remaining payment obligations. These funds cover the direct housing costs of families in the program. Currently, 83 percent of contracts are renewed annually; the other 17 percent are long-term contracts funded with previous appropriations, of which one-third will need amendment funding in 2012. Appropriations for these activities are supplemented with recoveries of excess balances remaining on expired contracts that utilized less than anticipated resources during their initial terms.

Contract Administrators.—This activity funds the local level administration of the program through HUD contracts with performance-based contract administrators. These entities, which are typically public housing authorities or state housing finance agencies, are responsible for conducting on-site management reviews of assisted properties; adjusting contract rents; reviewing, processing, and paying monthly vouchers submitted by owners; renewing contracts with property owners; and responding to health and safety issues at properties. The Budget requests up to $289 million for this set-aside.

Tenant Resource Network Grants.—The Budget provides up to $10 million for tenant resource network grants. These grants will provide financial assistance to tenant groups, nonprofit organizations, and public entities for building the capacity of tenant organizations and furthering the purposes of the Mark-to-Market program, including preservation of low-income housing and tenant services. The authority for these funds is provided under Section 514(f) of the Multifamily Assisted Housing Reform and Affordability Act (MAHRA) of 1997 (42 U.S.C. 1437f note).

For the Public Housing Capital Fund Program to carry out capital and management activities for public housing agencies, as authorized under section 9 of the United States Housing Act of 1937 (42 U.S.C. 1437g) (the "Act''), [$2,044,200,000]$2,405,345,000, to remain available until September 30, [2014]2015: Provided, That notwithstanding any other provision of law or regulation, during fiscal year [2011]2012 the Secretary of Housing and Urban Development may not delegate to any Department official other than the Deputy Secretary and the Assistant Secretary for Public and Indian Housing any authority under paragraph (2) of section 9(j) regarding the extension of the time periods under such section: Provided further, That for purposes of such section 9(j), the term "obligate'' means, with respect to amounts, that the amounts are subject to a binding agreement that will result in outlays, immediately or in the future: Provided further, That up to $15,345,000 shall be to support the ongoing Public Housing Financial and Physical Assessment activities[of the Real Estate Assessment Center (REAC)]: Provided further, That of the total amount provided under this heading, not to exceed $20,000,000, shall be available for the Secretary to make grants, notwithstanding section 204 of this Act, to public housing agencies for emergency capital needs, including needs resulting from unforeseen or unpreventable emergencies and natural disasters excluding Presidentially declared emergencies and natural disasters under the Robert T. Stafford Disaster Relief and Emergency Act (42 U.S.C. 5121 et seq.) occurring in fiscal year [2011]2012: Provided further, That of the total amount provided under this heading up to [$8,820,000]$5,000,000 is to support the costs of administrative and judicial receiverships: Provided further, That from the funds made available under this heading, the Secretary shall provide bonus awards in fiscal year [2011]2012 to public housing agencies that are designated high performers. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Public Housing Capital Fund, a formula-driven program based on estimated need, is designed to respond to the capital and management improvement requirements of public housing. The program preserves and enhances a valuable affordable housing resource, which serves approximately 1.2 million families with limited incomes. Of those families, 30 percent are elderly and 34 percent are disabled.

Of the $2.4 billion requested for this program, over $2.3 billion will fund capital grants to public housing authorities. The balance includes up to $15 million for public housing financial and physical assessment support, up to $20 million for emergency capital needs resulting from non-Presidentially declared emergencies and natural disasters, and up to $5 million for administrative and judicial receiverships.

Object Classification (in millions of dollars)

For [2011]2012 payments to public housing agencies (PHAs) for the operation and management of public housing, as authorized by section 9(e) of the United States Housing Act of 1937 (42 U.S.C. 1437g(e)), [$4,829,000,000]$3,961,850,000: Provided, That, in determining public housing agencies' (PHAs), including Moving to Work (MTW) agencies', calendar year 2012 funding allocations under this heading, the Secretary shall take into account PHAs' excess operating reserves, as determined by the Secretary: Provided further, That if sufficient reserve-level data are not available with respect to the previous proviso, the Secretary may make a pro rata reduction in funding provided under this heading to PHAs, including MTW agencies. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Budget request of $3.962 billion, coupled with $1 billion from Public Housing Authorities' (PHAs) operating reserves, will fund 100 percent of PHAs' estimated eligibility for operating subsidies under the Operating Fund formula ($4.962 billion total). Operating subsidies are provided to PHAs to assist in funding the operation and maintenance expenses of public housing units in accordance with Section 9(e) of the United States Housing Act of 1937.

Many PHAs are currently holding significant operating reserves accumulated primarily from prior-year appropriations for the Operating Fund program. Operating reserves represent cash available to PHAs for operating expenses and other eligible activities under the program. The Budget proposes to reduce funding allocations to PHAs that have more than sufficient (i.e., excess) reserve levels. PHAs that receive reduced allocations will be able to maintain adequate reserve levels to protect against unforeseen circumstances such as emergency operating needs, declining tenant incomes, or spikes in utility prices.

The tables below display the sources of PHAs' revenue and expenditures by category and are based on annual financial statements reported during calendar year 2009.

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Sources of PHAs' Operating Revenue (in millions of dollars)

Operating Subsidies._Represent HUD's contributions to a PHA's operating budget. After consultation with PHAs, HUD adopted the current formula in 2007 based on the congressionally sanctioned cost study conducted by the Harvard Graduate School of Design. HUD sets a formula-determined project expense level (PEL) for each project and separately computes the project utility expense level (UEL) and audit costs. The subsidy is the projected PEL, UEL, and allowable add-on expenses minus projected dwelling rental income.

Dwelling Rental._Income derived from tenants' rents.

Other Income._Includes income from other sources such as renting rooftop space for signs or broadcasting, and from operating services for tenants, such as laundromats or day care centers.

PHAs' Operating Expenditures (in millions of dollars)

Utilities._ Includes water, sewer, electricity, gas, and fuel.

Administration._ Includes administrative salaries, legal expenses, staff training, travel, accounting fees, auditing fees, sundry, and outside management costs.

Maintenance._Consists of expenses for labor, materials, contracts, and garbage fees associated with the day-to-day operation of the public housing authority.

General Operating Expenses._Includes insurance, payments made to local governments in lieu of taxes, terminal leave payments, employee benefit contributions, collection losses, interest on administrative and sundry notes, and other general expenses.

Tenant Services._Covers salaries, recreation, publication, contract costs, training, and other expenses.

Protective Services._Includes expenses for labor, materials, and contract costs.

Program and Financing (in millions of dollars)

No new appropriations have been provided for the Public Housing Drug Elimination Grants program since 2001.

For competitive grants under the Choice Neighborhoods Initiative for transformation, rehabilitation and replacement housing needs of both public and HUD-assisted housing and to transform neighborhoods of [extreme] poverty into functioning, sustainable mixed income neighborhoods with appropriate services, schools, public assets, transportation and access to jobs, $250,000,000, to remain available until September 30, 2014: Provided, That not to exceed $10,000,000 of funds made available under this heading may be used for technical assistance and contract expertise, including training and the cost of necessary travel for participants in such training, to be provided directly or indirectly through grants, contracts or cooperative agreements by or to officials of the Department and to public housing agencies and residents: Provided further, That grant funds may be used for resident and community services, community development and affordable housing needs in the community, and for conversion of vacant, [or] foreclosed and other blighted properties in the neighborhood to affordable housing: Provided further, That grantees shall undertake comprehensive local planning with input from residents and the community, and that grantees shall provide a match in state, local, other Federal or private funds: Provided further, That grantees may include local governments, public housing authorities, non-profits and for-profit developers, and that such grantees shall create partnerships with other local organizations including assisted housing owners, service agencies and resident organizations: Provided further, That the Secretary shall consult with the Secretaries of Education, Labor, Transportation, Health and Human Services, Agriculture, [and] Commerce, the Attorney General and the Administrator of the Environmental Protection Agency to coordinate and leverage other appropriate [f]Federal resources: Provided further, That no more than ten percent of funds made available under this heading may be provided for planning grants to assist communities in developing comprehensive strategies for implementing this program in conjunction with community notice and input: Provided further, That the Secretary shall develop and publish guidelines for the use of such competitive funds, including but not limited to eligible activities, program requirements, and performance metrics: Provided further, That not to exceed $5,000,000 of funds made available under this heading and any funds transferred to HUD from the Departments of Health and Human Services, Education, and Justice may be used for a Neighborhood Revitalization Grant (NRG) initiative: Provided further, That the NRG initiative shall provide competitive grants to local governments or organizations partnering with local governments to fill key gaps that would otherwise hamper revitalization activities, build organizational capacity for collaborative data utilization and evidence-based planning, and for other neighborhood revitalization activities as determined by the Secretary: Provided further, That all balances of amounts made available for the Choice Neighborhoods Initiative under the heading Revitalization of Severely Distressed Public Housing (HOPE VI) [in the Department of Housing and Urban Development Appropriations Act, 2010 >]shall be transferred to [and merged with amounts made available under this heading]this account. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Budget proposes $250 million for the Choice Neighborhoods Initiative to continue the transformation of neighborhoods of poverty into functioning, sustainable mixed-income neighborhoods with appropriate services, schools, public assets, transportation, and access to jobs. The goal of the program, first funded in 2010, is to demonstrate that concentrated and coordinated neighborhood investments from multiple sources can transform a distressed neighborhood and improve the quality of life of current and future residents. HUD expects to award its first Choice Neighborhoods planning and implementation grants in March and September 2011, respectively.

Choice Neighborhoods implementation grants primarily fund the preservation, rehabilitation, and transformation of public housing and other HUD-assisted multifamily rental housing. These grants build on the successes of public housing transformation under HOPE VI with a broader approach to concentrated poverty. Grantees include not only public housing authorities but also local governments, non-profits and for-profit developers. Grant funds can be used for resident and community services, community development and affordable housing activities in surrounding communities, and multifamily or single family property disposition, including the conversion of these properties to affordable housing. The Budget will fund 5 to 7 implementation grants.

Grantees are required to undertake comprehensive local planning with input from residents and the community. A strong emphasis is placed on local community planning for school and educational improvements, including early childhood initiatives. Up to ten percent of the request will fund 50 to 75 planning grants to assist local partnerships to develop strong proposals for future implementation grant competitions.

The Budget also emphasizes coordination with other Federal agencies, notably the Departments of Education, Justice, Health and Human Services and Treasury, through the White House Neighborhood Revitalization Initiative. To complement Choice Neighborhoods and other existing Federal investments in distressed neighborhoods and to strengthen interagency coordination, the 2012 Budget proposes a Neighborhood Revitalization Grant (NRG) initiative. This initiative will award grants of $3-$5 million to approximately 4 to 7 high-need neighborhoods to: (1) fill key gaps that would otherwise hamper revitalization; (2) build organizational capacity for data utilization and evidence-based planning; and (3) leverage and target large and flexible funding sources from Federal agencies, as well as State, local, and private dollars. The NRG initiative is funded by $5 million from Choice Neighborhoods and contributions of up to $5 million from each of the following Departments: Education, Justice, and Health and Human Services.

Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The HOPE VI program, in coordination with funding from the Public Housing Capital Fund, has accomplished its goal of contributing to the demolition of 100,000 severely distressed public housing units. The Budget proposes no additional funds for this program. Instead, the Budget proposes to build on the success of HOPE VI with its Choice Neighborhoods Initiative. First funded in 2010, Choice Neighborhoods makes a broad range of transformative investments in high-poverty neighborhoods where public housing and other HUD-assisted housing is concentrated. HUD expects to award its first Choice Neighborhoods planning and implementation grants in March and September 2011, respectively.

Remaining balances of HOPE VI grants will spend out over several years as redevelopment projects are completed. Cumulative results of the HOPE VI program as of September 30, 2010 are as follows: 73,167 households relocated; 96,017 units demolished; 83,951 units (new and rehabilitated) completed; and 82,425 completed units occupied.

For the Native American Housing Block Grants program, as authorized under title I of the Native American Housing Assistance and Self-Determination Act of 1996 (NAHASDA) (25 U.S.C. 4111 et seq.), [$580,000,000]$700,000,000, to remain available until expended: Provided, That, notwithstanding the Native American Housing Assistance and Self-Determination Act of 1996, to determine the amount of the allocation under title I of such Act for each Indian tribe, the Secretary shall apply the formula under section 302 of such Act with the need component based on single-race Census data and with the need component based on multi-race Census data, and the amount of the allocation for each Indian tribe shall be the greater of the two resulting allocation amounts: Provided further, That of the amount provided under this heading, $2,000,000 shall be made available for the cost of guaranteed notes and other obligations, as authorized by title VI of NAHASDA: Provided further, That such costs, including the costs of modifying such notes and other obligations, shall be as defined in section 502 of the Congressional Budget Act of 1974, as amended: Provided further, That these funds are available to subsidize the total principal amount of any notes and other obligations, any part of which is to be guaranteed, not to exceed $20,000,000. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in millions of dollars)

Title I of the Native American Housing Assistance and Self-Determination Act (NAHASDA) of 1996 (P.L. 104–330) authorized the Native American Housing Block Grant program. This program provides an allocation of funds on a formula basis to Indian tribes and their tribally designated housing entities to help them address housing needs within their communities. HUD has determined, using 2000 Census data, that 273,658 American Indian/Alaska Native households, out of 965,684, have "severe housing needs." This is defined as a lack of basic plumbing or kitchen facilities, having more than 1.01 persons per room, or having a cost burden of over 50 percent of income. According to the Senate Committee on Indian Affairs, in 2002, 90,000 Indian families were homeless or underhoused. On tribal lands, 28 percent of Indian households were found to be overcrowded or to lack adequate plumbing and kitchen facilities, compared to 5.4 percent of national households.

The Budget includes $700 million for the total activities of this program in 2012. Because of the appropriations provided in the Recovery Act, direct program output, as measured by outlays, will be at historically high levels in 2011.

The Native American Housing Block Grant program includes a guaranteed loan provision (Title VI). A guarantee level of $20 million is proposed for this loan guarantee program for 2012. A primary goal of the Title VI program is to encourage private lenders to provide financing in Indian Country. Therefore, the program provides for the Federal guarantee of notes or other obligations issued by Indian tribes or tribally designated housing entities for the purpose of financing affordable housing activities described in section 202 of the Act.

As required by the Federal Credit Reform Act of 1990, this account records, for this program, the subsidy costs associated with the loan guarantees committed in 1998 and beyond (including modifications of guarantees that resulted from obligations in any given year), as well as administrative expenses of this program. The subsidy amounts are estimated on a present value basis; the administrative expenses are estimated on a cash basis.

For the Native Hawaiian Housing Block Grant program, as authorized under title VIII of the Native American Housing Assistance and Self-Determination Act of 1996 (25 U.S.C. 4111 et seq.), $10,000,000, to remain available until expended. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Hawaiian Homelands Homeownership Act of 2000 (P.L. 106–568) amended the Native American Housing Assistance and Self-Determination Act of 1996 by adding Title VIII, which authorized the Native Hawaiian Housing Block Grant program. This program provides an allocation of funds to assist and promote affordable housing activities to develop, maintain and operate affordable housing for eligible low-income Native Hawaiian families.

It authorizes annual grants to the Department of Hawaiian Home Lands (DHHL) for housing and housing-related assistance, pursuant to an annual housing plan, within the area in which DHHL is authorized to provide that assistance. DHHL uses performance measures and benchmarks that are based on the needs and priorities established in its five- and one-year housing plans. The Budget requests $10 million for this program.

Program and Financing (in millions of dollars)

Status of Direct Loans (in millions of dollars)

Status of Guaranteed Loans (in millions of dollars)

The Low-Rent Public Housing Loan Fund provides direct Federal loans to fund remaining Public Housing Agency (PHA) and Indian Housing Authority (IHA) construction, acquisition, and modernization activities reserved under the Annual Contributions appropriation through 1986. These loans are made by borrowing from the Treasury. Under legislation enacted during 1986 (P.L. 99–272), amounts borrowed from the Treasury are forgiven at the end of each fiscal year and the loans to PHAs/IHAs are forgiven as construction, acquisition, and modernization activities are completed. Since 1987, new reservations of capital funds for construction, acquisition, and modernization activities have been provided directly from the Public Housing Capital Fund appropriations.

Balance Sheet (in millions of dollars)

For the cost of guaranteed loans, as authorized by section 184 of the Housing and Community Development Act of 1992 (12 U.S.C. 1715z), [$9,000,000]$7,000,000, to remain available until expended: Provided, That such costs, including the costs of modifying such loans, shall be as defined in section 502 of the Congressional Budget Act of 1974: Provided further, That these funds are available to subsidize total loan principal, any part of which is to be guaranteed, up to [$994,000,000]$428,000,000: Provided further, That up to $750,000 shall be for administrative contract expenses including management processes and systems to carry out the loan guarantee program. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in millions of dollars)

As required by the Federal Credit Reform Act of 1990, this account records, for this program, the subsidy costs associated with the loan guarantees committed in 1992 and beyond (including modifications of guarantees that resulted from obligations in any year). The subsidy amounts are estimated on a net present value basis. The administrative expenses are shown on a cash basis.

This program provides access to sources of private financing for Indian families, Indian tribes, and their tribally designated housing entities who otherwise could not acquire housing financing because of the unique legal status of Indian trust land. The Budget proposes $7 million to support additional loan guarantee activity and to provide managerial and systems support. The program has issued 12,062 loan guarantees totaling $1.82 billion since 1995, with 48 percent of the activity occurring in 2009 and 2010. Program growth for 2012 is expected to increase by 30 percent, representing almost $830 million in obligated lending authority, comprised of 5,188 loans. Even through the national foreclosure crisis, the program maintains a claims rate of less than one percent.

Object Classification (in millions of dollars)

Program and Financing (in millions of dollars)

Status of Guaranteed Loans (in millions of dollars)

As required by the Federal Credit Reform Act of 1990, this non-budgetary account records all cash flows to and from the Government resulting from the loan guarantees committed in 1992 and beyond (including modifications of loan guarantees that resulted from obligations in any year). The amounts in this account are a means of financing and are not included in the budget totals. As required by the Federal Credit Reform Act of 1990, no administrative expenses can be recorded in the financing account.

Balance Sheet (in millions of dollars)

Program and Financing (in millions of dollars)

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in millions of dollars)

As required by the Federal Credit Reform Act of 1990, this account records, for this program, the subsidy costs associated with the loan guarantees committed in 2001 and beyond (including modifications of guarantees that resulted from obligations in any year). The subsidy amounts are estimated on a net present value basis. The administrative expenses are shown on a cash basis.

This program provides access to sources of private financing to eligible Native Hawaiian families who reside on the Hawaiian Home Lands and who otherwise could not acquire private financing because of the unique legal status of the Hawaiian Home Lands. No funds are requested for 2012 as there are sufficient unobligated balances to meet program demand.

Program and Financing (in millions of dollars)

Status of Guaranteed Loans (in millions of dollars)

As required by the Federal Credit Reform Act of 1990, this non-budgetary account records all cash flows to and from the government resulting from the loan guarantees committed in 2001 and beyond (including modifications of loan guarantees that resulted from obligations in any year). The amounts in this account are a means of financing and are not included in the budget totals. As required by the Federal Credit Reform Act of 1990, no administrative expenses can be recorded in the financing account.

Balance Sheet (in millions of dollars)

Program and Financing (in millions of dollars)

Status of Guaranteed Loans (in millions of dollars)

As required by the Federal Credit Reform Act of 1990, this non-budgetary account records all cash flows to and from the Government resulting from loan guarantees committed in 1992 and beyond (including modifications of loan guarantees that resulted from commitments in any year). The amounts in this account are a means of financing and are not included in the budget totals. As required by the Federal Credit Reform Act of 1990, no administrative expenses can be recorded in the financing account.

Balance Sheet (in millions of dollars)

Federal Funds

For carrying out the Housing Opportunities for Persons with AIDS program, as authorized by the AIDS Housing Opportunity Act (42 U.S.C. 12901 et seq.), [$340,000,000]$335,000,000, to remain available until September 30, [2012]2013, except that amounts allocated pursuant to section 854(c)(3) of such Act shall remain available until September 30, [2013]2014: Provided, That the Secretary shall renew all expiring contracts for permanent supportive housing that were funded under section 854(c)(3) of such Act that meet all program requirements before awarding funds for new contracts and activities authorized under this section. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Housing Opportunities for Persons with AIDS (HOPWA) program is the only Federal program dedicated to address the urgent housing needs of low-income Americans living with HIV and AIDS. HOPWA funding provides States and localities with resources and incentives to devise long-term comprehensive strategies for planning and providing housing and supportive services to meet the complex, multiple needs of persons living with HIV and AIDS and their families. HOPWA funds have been demonstrated to help reduce the risk of homelessness, increase housing stability, and improve access to HIV care and health outcomes for program participants.

Ninety percent of HOPWA funds are distributed to States and eligible metropolitan areas according to a formula, which is based on the number of AIDS cases in the jurisdiction and incidence of AIDS in metropolitan areas. The remaining ten percent is awarded competitively to States, local governments, and private nonprofit entities, for projects of national significance. Awards are also made to States and local governments for projects in jurisdictions that do not qualify for a formula allocation. HUD provides funding priority to the renewal of expiring competitive projects that provide permanent supportive housing. The $335 million requested for 2012 will support outcome goals in which assisted households will achieve housing stability in permanent housing.

For assistance to units of State and local government, and to other entities, for economic and community development activities, and for other purposes, [$4,380,100,000]$3,781,368,000, to remain available until September 30, [2013]2014, unless otherwise specified: Provided, That of the total amount provided, [$3,990,100,000]$3,691,368,000 is for carrying out the community development block grant program under [title]Title I of the Housing and Community Development Act of 1974, as amended (the "Act'' herein) (42 U.S.C. 5301 et seq.): Provided further, That unless explicitly provided for under this heading (except for planning grants provided in the second paragraph and amounts made available under the third paragraph), not to exceed 20 percent of any grant made with funds appropriated under this heading shall be expended for planning and management development and administration: Provided further, That $65,000,000 shall be for grants to Indian tribes notwithstanding section 106(a)(1) of such Act, of which, notwithstanding any other provision of law (including section 204 of this Act), up to $3,960,000 may be used for emergencies that constitute imminent threats to health and safety.

[Of the amounts made available under this heading, $150,000,000 shall be available for the Catalytic Investment Competition Grants program with the purpose of providing economic development gap financing to implement and capitalize innovative and targeted economic investment: Provided, That grant funds shall be targeted to communities or neighborhoods: (1) experiencing demonstrated distress as defined by the Secretary; and (2) that have developed an innovative and robust plan with measurable outcomes to increase jobs and improve economic vitality in a target area: Provided further, That grant funds may be used for, but not limited, to activities that: (1) implement projects designed to reclaim vacant property; (2) remove or ameliorate property-related obstacles to economic recovery; and (3) support economic activities related to transit-oriented development: Provided further, That an eligible applicant shall be a unit of general local government; a non-profit entity; or a consortium that shall include an eligible public entity and a designated lead applicant and may consist of states, local units of governments, community development corporations, and for-profit and non-profit entities: Provided further that an eligible applicant shall exhibit a plan for the funds that includes measurable outcomes for job creation and economic activity and the capacity to implement such a plan: Provided further, That except as otherwise provided by this paragraph, amounts appropriated under this heading for the Catalytic Investment Competition Grants program shall be treated as though such funds were community development block grant funds under title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.): Provided further, That in administering any amounts appropriated under this heading for the Catalytic Investment Competition Grants program, the Secretary may waive or specify alternative requirements to any provision under Title I of the Housing and Community Development Act of 1974 (except for those related to fair housing, nondiscrimination, labor standards, and the environment) to achieve the purposes of this proviso: Provided further, That all of the funds appropriated or otherwise made available under this heading for the Catalytic Investment Competition Grants program shall be used with respect to individuals and families whose income does not exceed 120 percent of area median income: Provided further, That for purposes of environmental review, if the applicant is not a unit of general local government, assistance and projects under this heading shall be treated as assistance for special projects that are subject to section 305(c) of the Multifamily Housing Property Disposition Reform Act of 1994, and shall be subject to the regulations issued by the Secretary to implement such section: Provided further, That the Secretary shall develop and publish guidelines for the use of funds made available for the Catalytic Investment Competition Grants program including, but not limited to, eligibility criteria, eligible activities, minimum grant amounts, and performance metrics.]

[Of the amounts made available under this heading, $150,000,000 shall be made available for a Sustainable Communities Initiative to improve regional planning efforts that integrate housing and transportation decisions, and increase the capacity to improve land use and zoning: Provided, That $100,000,000 shall be for Regional Integrated Planning Grants to support the linking of transportation and land use planning: Provided further, That not less than $25,000,000 of the funding made available for Regional Integrated Planning Grants shall be awarded to metropolitan areas of less than 500,000: Provided further, That $40,000,000 shall be for Community Challenge Planning Grants to foster reform and reduce barriers to achieve affordable, economically vital, and sustainable communities: Provided further, That the Secretary will consult with the Secretary of Transportation in evaluating grant proposals: Provided further, That up to $10,000,000 shall be for a joint Department of Housing and Urban Development and Department of Transportation research effort that shall include a rigorous evaluation of the Regional Integrated Planning Grants and Community Challenge Planning Grants programs, as well as to provide funding for a clearinghouse and capacity building efforts:]

[Provided further, That of the amounts made available under this heading, $25,000,000 shall be made available for the University Community Fund for grants to assist universities in revitalizing surrounding communities, with special attention to Historically Black Colleges and Universities, Tribal Colleges and Universities, Alaska Native/Native Hawaiian institutions, and Hispanic-Servicing Institutions: Provided further, That the Secretary shall develop and publish guidelines for the use of such competitive funds including, but not limited to, eligibility criteria, minimum grant amounts, and performance metrics.]

Of the amounts made available under this heading, $25,000,000 shall be made available for the Rural Innovation Fund for grants to Indian tribes, State housing finance agencies, State community and/or economic development agencies, local rural nonprofits and community development corporations to address the problems of concentrated rural housing distress and community poverty: Provided, That of the funding made available under the previous proviso, at least $5,000,000 shall be made available to promote economic development and entrepreneurship for federally recognized Indian Tribes, through activities including the capitalization of revolving loan programs and business planning and development, and technical assistance to increase capacity through training and outreach activities. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Community Development Fund account includes the Community Development Block Grant (CDBG) and other community and economic development programs administered by the Department of Housing and Urban Development (HUD). The CDBG program provides over 1,200 flexible annual formula grants to the States, Insular Areas, and local governments to benefit mainly low- to moderate-income persons. The funding is used for a wide range of community and economic development activities, such as public infrastructure improvements, housing rehabilitation and construction, job creation and retention, and public services (e.g., child care). Seventy percent of the CDBG formula grants are distributed to mainly urban areas (entitlement communities), and 30 percent to the States (non-entitlement communities).

The 2012 Budget funds the CDBG formula grant program at $3.7 billion to assist State and local governments address local priorities and needs. This reduced amount reflects the need to balance Federal budget constraints with the difficult fiscal conditions confronting State and local governments. The Administration will work with State and local governments to better leverage CDBG formula funds to make progress on projects focused on economic growth. For example, the Administration will work with grantees to complement CDBG formula funds with other Federal investments, such as Sustainable Communities, Growth Zones, and Neighborhood Revitalization initiatives to help stabilize and revitalize local economies.

The Indian Community Development program will continue to be funded at $65 million. This program provides eligible grantees with direct grants for use in developing viable Indian and Alaska Native Communities, including decent housing, a suitable living environment, and economic opportunities, primarily for low- and moderate-income persons.

This account also includes $25 million for the Rural Innovation Fund in 2012. The Rural Innovation Fund will provide grants to a range of entities to address the problems of concentrated rural housing distress and community poverty.

The 2012 Budget requests that the Sustainable Communities Initiative be funded as an independent account, and establishes an Office of Sustainable Housing and Communities, which administers the initiative, as a separate program bureau.

This account also reflects prior year CDBG disaster supplemental spending, the 2009 American Recovery and Reinvestment Act funding of $1 billion in CDBG formula grants, and $2 billion for Neighborhood Stabilization Program (NSP) II competitive grants. The NSP grants are for emergency assistance for the redevelopment of abandoned and foreclosed homes. Both the $3.92 billion NSP funding from the Housing and Economic Recovery Act of 2008 and the $1 billion from the Dodd-Frank Wall Street Financial Reform and Consumer Protection Act are mandatory appropriations and are reflected in a separate account.

Program and Financing (in millions of dollars)

No new appropriation is requested for the Empowerment Zone (EZ) and Renewal Community (RC) programs in the 2012 Budget. The EZs' tax incentives were extended through December 31, 2011, while the tax incentives for RCs expired on December 31, 2009.

The Budget includes a proposal for a new national competition to identify 20 growth zones (likely 14 urban zones and 6 rural zones) across the country. Growth Zones are designed to build on the success of Empowerment Zones, and will provide streamlined support to distressed communities. These zones will receive flexible grants for planning, seed capital, technical assistance, or other costs through the Economic Development Administration (EDA), as well as federal program flexibility, and two tax incentives: an employment incentive and an investment incentive. The competitive application process will reward communities that face distress and show promise for growth. The Department of Housing and Urban Development (HUD) will partner with EDA to help select urban zones, and HUD will also provide technical support to make the zones successful.

Program and Financing (in millions of dollars)

The 2012 Budget requests no funding for the Brownfields Economic Development Initiative (BEDI) program. BEDI is a competitive grant program designed to assist cities with the redevelopment of brownfield sites for the purposes of economic development and job creation. Brownfields are abandoned, idled, and underused industrial and commercial facilities and land where expansion and redevelopment is burdened by real or potential environmental contamination. The program is relatively small and local governments have access to other public and private funds, including the larger Community Development Block Grant (CDBG), which can serve similar purposes.

For the HOME investment partnerships program, as authorized under title II of the Cranston-Gonzalez National Affordable Housing Act, as amended, $1,650,000,000, to remain available until September 30, [2013]2014: Provided, That, funds provided in prior appropriations Acts for technical assistance, that were made available for Community Housing Development Organizations technical assistance, and that still remain available, may be used for HOME technical assistance notwithstanding the purposes for which such amounts were appropriated. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The HOME Investment Partnerships Program is authorized by the National Affordable Housing Act (P.L. 101–625), as amended. This program provides flexible annual formula grant assistance to States and units of local government to increase the supply of affordable housing and expand homeownership for low- to very-low income persons. Sixty percent of the formula grant funds is awarded to participating local governments and 40 percent is awarded to states. These communities often use the funds in partnership with local non-profit organizations to fund a wide range of activities that build, buy, and/or rehabilitate affordable housing for rent or homeownership or provide direct rental assistance to low-income people. Projects funded by HOME often leverage private dollars and are used in conjunction with the Low-Income Housing Tax Credit, Community Development Block Grant, and local funds. The Budget requests $1.65 billion for HOME and does not provide separate funding for the Self-Help Homeownership Opportunity Program (SHOP), as all SHOP activities are eligible under the HOME program.

Over time, the funding provided in the 2012 Budget is estimated to result in the production of almost 72,215 units of affordable housing through new construction, rehabilitation, and/or acquisition. It is also estimated that communities will use a portion of their funding to support tenant-based rental assistance for over 17,955 units.

This account also reflects a $2.25 billion special allocation of HOME funds provided under the American Recovery and Reinvestment Act of 2009 (P.L. 111–5), called the Tax Credit Assistance Program (TCAP). By 2012, TCAP will have accelerated the production and preservation of over 35,000 units of affordable housing that received an award of Low-Income Housing Tax Credits.

Both HOME and TCAP funds will contribute to HUD's high priority performance goal to increase the number of families served by its rental housing programs.

The Housing Trust Fund was originally authorized in the Housing and Economic Recovery Act of 2008 (Pub. L. 110–289) under section 1338 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 1301 et seq.) with a dedicated funding stream from assessments on Fannie Mae and Freddie Mac. However, the Federal Housing Finance Agency has indefinitely suspended these assessments. The Budget proposes to fund the Housing Trust Fund through legislation directing $1 billion to capitalize the fund.

The purpose of the Housing Trust Fund is to provide grants to States to increase and preserve the supply of affordable rental housing and homeownership opportunities for extremely low- and very low-income families, and help address the growing shortage of affordable housing for these families. This program is similar to HOME, but is more income-targeted. The funding will be distributed by formula to States or State-designated entities that will target resources to areas with substantial needs. The funding will be used for production, preservation, and rehabilitation of affordable rental housing and for production, preservation, and rehabilitation of housing for homeownership (limited to 10 percent of the funding). Of the total amounts made available, not less than 75 percent shall be used to benefit extremely low-income households, for whom the affordable housing shortage problem is most acute. Over time, the funding provided for the Housing Trust Fund in 2012 is expected to produce approximately 36,000 affordable units.

Program and Financing (in millions of dollars)

[For grant assistance to eligible recipients to develop the capacity and ability of community development corporations, community housing development organizations, and local governments to undertake community development and affordable housing projects and programs that benefit low-income families, $60,000,000, to remain available until September 30, 2013: Provided, That eligible recipients for assistance include national and regional intermediaries with local affiliates, and a partnership or consortia of such intermediaries, skilled in the development of community development and affordable housing capacity, as determined by the Secretary: Provided further, That assistance provided under this heading shall be matched from private sources in an amount equal to three times: Provided further, That assistance under this heading may be used for: (1) training, education, and support to enhance technical and administrative capabilities; (2) loans, grants, or predevelopment assistance; (3) market research and rigorous needs assistance in order to create data resources, and develop assessment measures and assessment tools to determine the need and focus for community development activities; (4) the assessment and determination that organizational mergers may better serve the community; and (5) such other activities as may be determined eligible by the Secretary to further the purposes of this heading: Provided further, That the Secretary shall develop and publish guidelines for the use of such competitive funds including, but not limited to, eligibility criteria, program requirements, eligible administrative costs, and performance metrics.]For capacity building activities authorized under section 4 of the HUD Demonstration Act of 1993 (42 U.S.C. 9816 note), $50,000,000, to remain available until September 30, 2014, of which not less than $5,000,000 may be made available for rural capacity building activities. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)

The Capacity Building for Community Development and Affordable Housing program is authorized by Section 4 of the HUD Demonstration Act of 1993. The 2012 Budget requests $50 million for the program, which generates a required match of three dollars from private sources, for a total of $200 million for program activities. The Capacity Building program provides grants to national intermediaries to develop, enhance, and strengthen the technical and administrative capabilities of community development corporations to carry out community development and affordable housing activities for low- and moderate-income persons.

Program and Financing (in millions of dollars)

The 2012 Budget requests no appropriations for the Self-Help and Assisted Homeownership Opportunity Program (SHOP). Activities under the Capacity Building for Community Development and Affordable Housing Program are requested separately under the Capacity Building account.

SHOP is authorized by Section 11 of the Housing Opportunity Program Extension Act of 1996, and provides funds to increase the ability of non-profit organizations to leverage funds from other sources to assist low-income homebuyers willing to contribute "sweat equity" toward the construction of their houses. The Administration plans to encourage State and local government grantees of the larger HOME Investment Partnerships Program to fund SHOP projects, as the HOME statute includes the same eligible activities.

Program and Financing (in millions of dollars)

The Neighborhood Stabilization Program (NSP) was authorized by the Housing and Economic Recovery Act of 2008 (HERA) and funded at $3.92 billion. In response to the foreclosure crisis, HERA directed HUD to develop a formula to distribute the funds to State and local governments with the greatest need. To determine the areas with the greatest need, the allocation formula had to be based on home foreclosures, subprime loans, and mortgage defaults or delinquencies. Grantees may use NSP funds for a number of eligible activities, including establishing financing mechanisms; purchasing and rehabililatating abandoned or foreclosed properties; establishing land banks; demolishing blighted structures; and redeveloping vacant or demolished property. NSP grantees must use at least 25 percent of the funds appropriated for the purchase and redevelopment of abandoned or foreclosed residential properties that will be used to house individuals or families whose incomes do not exceed 50 percent of the area median income. In addition, all activities funded by NSP must benefit low- and moderate-income persons whose income does not exceed 120 percent of area median income.

In September 2008, HUD announced direct NSP allocations to 309 jurisdictions, including all 50 states, Puerto Rico and the Insular Areas. Pursuant to HERA, grantees had 18 months from the date funds were made available to obligate the funds. By September 30, 2010, NSP1 grantees obligated 99.7 percent of their funds and disbursed 53 percent of funds by January 3, 2011.

The American Recovery and Reinvestment Act of 2009 (ARRA) made several changes to the NSP program as enacted by HERA and appropriated an additional $2 billion in funding for the NSP program. The ARRA funding for NSP2 is reflected within the Community Development Fund account. In January 2010, HUD announced 56 awards under the NSP2 program and all funds were obligated on February 11, 2010. NSP2 grantees have until February 11, 2012, to expend 50 percent of their grant funds and must expend 100 percent by February 11, 2013.

The Dodd-Frank Financial Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) appropriated an additional $1 billion for a third iteration of NSP (NSP3) in July 2010. The Department announced a formula allocation of these funds to 283 entities consisting of State and local governments in September 2010. Grantees are to submit their plans for using the NSP3 funds not later than March 2011 and, from the date HUD makes the funds available, grantees will have two years to expend 50 percent of the grant and three years to expend 100 percent.

For the emergency solutions grants program as authorized under subtitle B of title IV of the McKinney-Vento Homeless Assistance Act, as amended; the continuum of care program as authorized under subtitle C of title IV of such Act; and the rural housing stability assistance program as authorized under subtitle D of title IV of such Act, [$2,055,000,000]$2,372,000,000, of which [$2,050,000,000]$2,367,000,000 shall remain available until September 30, [2013]2014, and of which $5,000,000 shall remain available until expended for project-based rental assistance rehabilitation with 10-year grant terms and any rental assistance amounts that are recaptured under such continuum of care program shall remain available until expended: Provided, That up to [$200,000,000]$286,000,000 of the funds appropriated under this heading shall be available for such emergency solutions grants program: Provided further, That no less than [$1,844,000,000]$2,025,000,000 of the funds appropriated under this heading shall be available for such continuum of care and rural housing stability assistance programs: Provided further, That up to $50 million of the funds made available under this heading shall be available to make incentive payments, including payments to cover the cost of service coordinators, as determined by the Secretary, to Public Housing Authorities and owners assisted under Sections 8 and 9 of the U.S. Housing Act of 1937 that agree to serve additional homeless households: Provided further, That up to $6,000,000 of the funds appropriated under this heading shall be available for the national homeless data analysis project: Provided further, That for all match requirements applicable to funds made available under this heading for this fiscal year and prior years, a grantee may use (or could have used) as a source of match funds other funds administered by the Secretary and other Federal agencies unless there is (or was) a specific statutory prohibition on any such use of any such funds: Provided further, That the Secretary shall renew on an annual basis expiring contracts or amendments to contracts funded under the continuum of care program if the program is determined to be needed under the applicable continuum of care and meets appropriate program requirements and financial standards, as determined by the Secretary: Provided further, That all awards of assistance under this heading shall be required to coordinate and integrate homeless programs with other mainstream health, social services, and employment programs for which homeless populations may be eligible, including Medicaid, State Children's Health Insurance Program, Temporary Assistance for Needy Families, Food Stamps, and services funding through the Mental Health and Substance Abuse Block Grant, Workforce Investment Act, and the Welfare-to-Work grant program: Provided further, That all balances for Shelter Plus Care renewals previously funded from the Shelter Plus Care Renewal account and transferred to this account shall be available, if recaptured, for continuum of care renewals in fiscal year [2011]2012. Note.—A full-year 2011 appropriation for this account was not enacted at the time the budget was prepared; therefore, this account is operating under a continuing resolution (P.L. 111–242, as amended). The amounts included for 2011 reflect the annualized level provided by the continuing resolution.

Program and Financing (in millions of dollars)