HUD Opens Access to $5B in American Rescue Plan Grants to Prevent Homelessness

HUD recently published Notice CPD-21-10, Requirements for the Use of Funds in the HOME-American Rescue Plan Program. The notice establishes rules for granting the $5 billion provided under the American Rescue Plan Act through the HOME Investment Partnerships Program (HOME). 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.

One level deeper: Under the guidance, 100 percent of HOME-ARP dollars used for tenant-based rental assistance, supportive services, and acquisition and development of non-congregate shelter units must benefit individuals and families in qualifying populations, which include those who are homeless; at risk of homelessness; fleeing or attempting to flee domestic violence, dating violence, sexual assault, stalking, or human trafficking; and other households requiring services or housing assistance to prevent homelessness but do not otherwise qualify under the other categories. However, only 70 percent of affordable rental housing units acquired, rehabilitated, or constructed with HOME-ARP funds must be occupied by qualifying populations, with the remainder available to low-income households more generally. This flexibility is intended to help properties remain financially feasible.

Trendspotting: Expect HUD to take steps to increase its ability to distribute grants to help address the potential increase of evictions and households experiencing possible homelessness since the Supreme Court's ruling on the CDC's eviction moratorium. In a recent statement, HUD Secretary Marcia Fudge said, "I pledge that the Department of Housing and Urban Development will continue to use every tool at our disposal to protect those people whose health and well-being are now in jeopardy."

In April, HUD announced the American Rescue Plan funding allocations and broad contours of how the funds can be used. This notice is the first step in implementing the funds as it sets forth specific program requirements that participating jurisdictions or grantees must meet to begin planning for their use of their HOME American Rescue Plan funds in earnest. And it is effective immediately.