Capital Fund Financing Program (CFFP)

Summary

Some PHAs may not have enough funds in a single year to be able to make all of the improvements necessary to adequately maintain their public housing. As a result, PHAs may take advantage of the financing element of the Capital Fund. Under the Capital Fund Financing Program (CFFP), a PHA may borrow private capital to make improvements and pledge, subject to the availability of appropriations, a portion of its future year annual Capital Funds to make debt service payments for either a bond or conventional bank loan transaction.

PHAs may anticipate a review time generally between 60 and 90 days. The overall review timeline will depend upon the completeness of the Proposal and the responsiveness of the PHA team. Generally, PHAs should receive HUD comments on their initial submittal within 30 to 45 days. To the extent that a Proposal is approvable, approval should occur within 30 to 45 days after HUD’s comments are provided, depending upon the completeness of the initial submittal, and the responsiveness of the PHA team. To the extent that the approval of the CFFP is needed to meet deadlines associated with the use of the CFFP proceeds (such as a mixed finance transaction that uses LIHTCs that have carryover or PIS requirements), PHAs should be conservative in projecting HUD review timelines. PHAs are advised to allow for unforeseen issues that might present themselves during the review process and challenge the PHA team’s ability to resolve in a timely manner.

The loans or bonds are obligations of the PHA. HUD does not guarantee or ensure these loans or bonds. The PHA obligation is subject to the availability of appropriations by Congress and compliance with statutory and regulatory requirements.

A PHA must obtain written HUD approval prior to executing any document that would encumber or pledge as collateral any Public Housing assets. This includes both physical assets and future Public Housing funding, such as Operating Funds or Capital Funds. In order to receive HUD approval, a PHA must submit a financing proposal that includes a term sheet, financial documents, and a justification for the use of Capital Funds for financing.

1. Approval - PHAs must request approval from the Deputy Assistant Secretary, Office of Public Housing Investments.
2. CF Pledges - Generally no more than 33% of the PHA's current annual CF grant adjusted for any proposed or planned demolition or disposition or other activity that would result in a reduction of the PHA units count or otherwise reduce CFP Funds appropriated or available to the PHA. All pledges are subject to the availability of appropriations.
3. Term - Generally, no more that 20 years.
4. Public Housing Requirements - Since the proceeds from a CFFP transaction are generated via the pledge and use of Capital Funds, HUD considers CFFP Proceeds to be, for all intents and purposes, Capital Funds. PHAs pursuing any type of CFFP transaction must follow all statutory and regulatory requirements related to the Capital Fund Program in regard to the development and implementation of their CFFP Proposal.
   
   Proposals Approved to Date - List of PHAs approved to Date (alphabetical list by state) (MS-Excel)

Proposals Approved to Date - List of Transactions Approved To Date (chronological list) (MS-Excel)

	How Does a PHA Apply?
	The Role of The Field Office
	Guidance for Legal Documents
	Post Approval Documentation Requirements
	Contact Information for CFFP Team
	Maximizing Leveraging - Mixed Finance Modernization
	Maximizing Leveraging - Mixed Finance Development