HOME Proposed Rule

On May 29, 2024, HUD published a Proposed rule in the Federal Register which would enable much needed revisions and updates to the requirements governing the HOME Investment Partnerships program. All public comments are due by July 29, 2024.

Key Information about the HOME Proposed Rule

The proposed rule would:

  • Expand access to community housing development organization (CHDO) set-aside funds by neighborhood-based nonprofit organizations.
  • Clarify homeownership requirements to improve compliance and improve program outcomes for homebuyers and implement new provisions for community land trusts to exercise preemptive purchase rights.
  • Better align HOME rental housing with other Federal rental assistance programs.
  • Simplify requirements applicable to small rental housing projects.
  • Make HOME tenant-based rental assistance work better for vulnerable populations.
  • Strengthen tenant rights and protections for occupants of HOME-assisted rental units and recipients of HOME tenant-based rental assistance.
  • Establish new method for determining maximum per-unit subsidy limits.
  • Provide incentives to incorporate green building technologies.
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Background

The HOME Investment Partnerships Program (HOME) provides formula grants to states and localities that communities use - often in partnership with local nonprofit groups - to fund a wide range of activities including building, buying, and/or rehabilitating affordable housing for rent or homeownership or providing direct rental assistance to low-income people. HOME is the largest federal block grant to state and local governments designed exclusively to create affordable housing for low-income households. State and local governments nationwide rely on annual formula HOME funds to develop meaningful projects and provide essential services that create sustainable, healthy, and prosperous communities, particularly for low- and moderate-income persons.

The HOME program is designed to provide state and localities the flexibility to design and administer affordable housing programs that are to their own needs and priorities. Participating Jurisdictions (PJs) choose the location, tenure, and type of housing in which they will invest.  However, there are Federal rules administered by HUD that put certain constraints around how HOME funds can be used.  HUD’s regulations seek to balance flexibility for PJs to use funds that best fit their local needs while ensuring funds are spent prudently and not counter to national priorities.

In creating this proposed rule, the Department focused on its commitment to equity and wealth-building and considered input from stakeholders throughout the years on the most challenging aspects of administering and using HOME funds to provide affordable housing.

Intended Impact of the Proposed Rule

The proposed rule supports the Administration’s commitment to streamline and modernize programs to make them easier to use and reduce burden on participating jurisdictions. The proposed rule will also increase flexibility for participating jurisdictions and other program participants, while adhering to statutory intent and requiring responsible management of State and local HOME programs and better align HOME with other affordable housing funding sources to benefit tenants and residents. The changes proposed will incentivize investment in vulnerable communities, while signaling the Federal government’s willingness to support these investments. Recognizing the important role that HOME plays in community development nationwide, HUD looks to enable state and local governments to encourage, build, and expand activities that revitalize communities.
 

Content current as of May 31, 2024.