By Eugene T. Lowe
April 6, 2009

The Department of Housing and Urban Development (HUD) has issued notices with details on how to assess the $1.5 billion in Homelessness Prevention Funds and the $3 billion in public housing capital funds, both appropriated in the American Recovery and Reinvestment Act (ARRA). The homelessness funds and the public capital funds are distributed by formula: homelessness funds are allocated according to the formula used for the Emergency Shelter Grants (ESG) program while allocations will go to public housing agencies who received either a Capital Fund Formula and/or a Replacement Housing Factor (RHF) Fund Grant in Fiscal Year 2008 under the Capital Fund Program.

Cities eligible to receive the homelessness funds will have to submit “a substantial amendment to the Consolidated Plan 2008 Action Plan.” The recovery funding is to be used “to provide financial assistance and services to either prevent individuals and families from becoming homeless or help those who are experiencing homelessness to be quickly re'housed and stabilized.” The substantial amendment to receive funds must be submitted to HUD no later than 60 days from March 19, the publication date of the Notice. HUD will complete review of the amendments by July 2, and execute all grant agreements by September 1.

Public housing agencies must use the funds on Capital Fund eligible activities currently identified in either their Annual Statement or Five'Year Action Plan. Additional requirements include:

• PHAs must give priority consideration to the rehabilitation of vacant rental units;

• PHAs must prioritize capital projects, that are already underway and require additional funds, or are included in the Five'Year Capital Fund Action Plan;

• PHAs must use the funds provided in this grant to supplement expenditures, not to supplant expenditures from other federal, state or local sources or funds independently generated; and

• The PHA will be required to provide a physical needs assessment (PNA) as specified by HUD, using funds from this Recovery Act grant or other Capital Funds. (The Notice makes it clear that PHAs do not have to complete the PNA before beginning modernization work using the recovery grant funds).

In addition to the $3 billion public housing capital funds now being released through formula, an additional $1 billion in competitive grant funds will awarded later based on criteria developed by HUD. The notice on the homeless prevention funds can be found on the website www.hud.gov. The public housing notice can be found at www.hud.gov/offices/pih/publications/notices/09/pih2009'12.pdf