New research from CLPHA and Econsult Solutions shows that PHAs generate and induce multiple streams of economic activity benefitting those who reside in public housing, as well as local employers, governments, and industries. "The Economic Impact of Public Housing: Ongoing Investment with Wide Reaching Returns," highlights four key findings:
Public Housing is an Economic Driver
Housing authorities generate economic impacts that ripple through the community, city, and region. PHAs own and manage large property portfolios as well as directly support real estate markets through Housing Choice Vouchers and other housing assistance payments.
- Every $1 million PHAs spend on capital investments generates $1.89 million in economic activity and supports 11 full-time jobs
- From FY13-17, PHAs in Akron, Charlotte, Kansas City, Los Angeles, New York, and Oklahoma spent $4.5 billion on capital needs and generated an estimated $7.6 billion in economic activity, supporting 7,600 full-time jobs
Public Housing is Workforce Housing
While the majority of public housing residents are elderly and/or disabled, among work-able households, most are either working, subject to work requirements, or have worked recently.
Public Housing is a Long-Term Investment
The 1.1 million public housing units around the country are a significant investment by the federal government, with a replacement cost of $183 billion.
Public Housing is a Tax Revenue Generator
Public housing is a critical element of regional and local infrastructure due to its proximity to transportation, business centers, educational opportunities, other housing, and community centers, as well as its multiple economic intersections and influence on the economic growth of their cities.
- 6 PHAs generate $69 million in city tax revenue and $215 million in state tax revenue each year.
PHAs Can Now Apply for a Waiver to Adjust Rents, Following CLPHA’s Advocacy
HUD has published RAD Supplemental Notice 4C, which contains several major revisions. Most notably, properties that converted under RAD that have insufficiently low rents are now able to apply for a waiver of rent adjustments by OCAF; CLPHA advocated for this relief through its RAD Rents Working Group. The changes in the Notice are effective immediately and are subject to a 30-day comment period. Other major changes in the Notice include:
- Implementing the extended application date to September 30, 2029, including for both stand-alone applications and applications for Portfolio Awards;
- Changing to RAD-Section 18 Blends allowing for tenant protection voucher (TPV) assistance to convert to a RAD HAP Contract under either PBRA or PBV when a Section 18 event occurs at a property that is partially converting;
- Allowing PHAs to continue Jobs Plus, ROSS, and FSS programs at properties that undergo RAD conversion;
- Strengthening requirements for owners to submit annual financial statements;
- Extending the notification requirement to 30 days prior to termination for nonpayment of rent;
- Clarifying that each HAP Contract must be renewed/extended after its initial term of 15 or 20 years;
- Providing guidance on security deposits, pet occupancy, and the use of plain language in resident leases;
- Making clarifying changes to resident notification requirements for Restore-Rebuild developments (formerly called Faircloth-to-RAD) where the proposed project is occupied;
- Strengthens the Financing Plan Requirements and Feasibility Benchmarks for public housing properties undergoing a RAD conversion;
- Making changes to conform RAD to the HOTMA PBV rule.
RAD-Section 18 Blends:
The Notice implements statutory changes around RAD and Section 18 Blends that allow HUD to convert tenant protection voucher (TPV) assistance to a RAD HAP Contract, under either PBRA or PBV, when partially converting a Section 9 property under RAD and an event under Section 18 occurs that results in eligibility for TPVs. Public housing properties that have been developed pursuant to the mixed-finance development method are eligible for RAD/Section 18 Blends.
Owners of properties that previously entered into a RAD PBRA HAP Contract that also includes units assisted by a PBV HAP contract can now request to terminate the PBV HAP Contract and enter into one single RAD PBRA HAP Contract for all assisted units with a term at least as long as the remaining term of the original RAD PBRA HAP Contract. Any residents of PBV units will not be rescreened and will retain all choice-mobility rights.
MTW agencies can use their MTW funds to set the initial contract rents higher than the normally applicable contract rent cap. However, the initial contract rent set by the PHA is still subject to all other applicable program caps. The agency must use existing MTW funds to supplement the initial contract rent, and any use of MTW funds in setting higher initial contract rents is still subject to subsidy layering review and MTW continued service requirements, as calculated using the MTW Baseline Methodology (described in Notice PIH 2013-02).
HUD will produce a single, blended rent schedule for all units resulting from a RAD/Section 18 Blend. The rent schedule will be calculated as the unit-weighted average contract rent by bedroom of the Converting Public Housing Assistance using the RAD rents based on their “RAD rent base year” (described in Attachment 1C of the Notice), and the Converting TPV Assistance using the lower of 110% of the applicable FMR (or approved exception payment standard) minus any Utility Allowance or the Reasonable Rent.
Requesting Waivers of Rental Adjustments by OCAF
A project owner may request a waiver of the rental adjustment by OCAF and receive a rental adjustment by an alternative operating cost factor. To request a waiver of the rental adjustment by OCAF, project owners must submit a request along with documentation demonstrating the need for an alternative operating cost factor rental adjustment in order to preserve the project. The submission to the Office of Recapitalization must be consistent with instructions published on www.hud.gov/rad. If the Office of Recapitalization grants the waiver, they will determine the appropriate alternative operating cost factor and resulting rents. For PBV, the Contract Administrator must consent to the request and their consent must be evidenced in the Project Owner’s documentation.
Financing Plan Requirements and Feasibility Benchmarks
The Notice makes changes to financing plan requirements and feasibility benchmarks for any transaction that has not submitted a complete Financing Plan on or before April 16, 2025 (the 90th day after the Effective Date of this Notice). All other transactions will be subject to the previous provisions of the RAD Notice, Rev-4.
Under 24 CFR § 58.11(c), all conversions will be subject to an environmental review under Part 50. Environmental documents are required to be submitted no later than the applicant’s Financing Plan. Once an awardee has submitted an application for a specific project, they may not make any choice limiting actions before the completion of the environmental review. The Notice contains details about the environmental documents that must be submitted, the entity that performs the review for each transaction type, and more.
HOTMA conforming changes
The Notice makes technical changes to the RAD Notice to update regulatory references and language and certain non-technical changes to resolve conflicts between the RAD Notice and the HOTMA Voucher Final Rule. These include several modified definitions; the maximum number of PBV units (percentage limitation); the cap on the number of PBV Units in each project (Income-Mixing requirement); proposal and project selection procedures; applicability of PBV housing types, execution of RAD PBV HAP Contract, and RAD rehab assistance payments; and changes to the execution of RAD PBV HAP Contract and rehabilitation.
Any questions should be emailed to RAD@hud.gov. Additionally, HUD will develop informational materials to address various program elements that HUD will post on the RAD website.
Building of 5 or Fewer Dwelling Units Are Now Exempt from BABA; Solar Modules Assembled in America Are Also Exempt from BABA
HUD has published PIH Notice 2025-06, which contains updated guidance on the Build America, Buy America (BABA) and supersedes the previous guidance from PIH Notice 2024-01. The new issues/clarifications addressed include clarification of what constitutes private housing that is not subject to BABA, that BABA applies to the Choice Neighborhoods Initiative grant program, guidance on how BABA applies to the Moving to Work Demonstration, documenting compliance, minimum due diligence search requirements, safe harbor procurement strategies, and the Notice contains a Certification of Product Compliance Form (in Appendix A), as well as other clarifications.
Building with 5 or Fewer Dwelling Units Exempt from BABA
Notably, HUD has determined that buildings that have fewer than 5 dwelling units within them are considered private and therefore not ‘Infrastructure’; therefore, buildings with fewer than 5 dwelling units are not subject to BABA. In contrast, projects consisting of the construction, maintenance, alteration, or repair of multifamily housing (buildings that contain 5 or more dwelling units) are not considered private homes for personal use because they are multifamily housing projects and therefore are subject to BABA requirements.
Scope of an Infrastructure Project
The notice offers guidance on the scope of an ‘infrastructure project’, including for cases such as indefinite quantity contracts. The scope of an Infrastructure Project can change during the course of implementing the project, which can in turn impact the application of BABA to the Infrastructure Project. In the instance of the use of Force Account Labor, both the labor and the associated acquisition of materials required to accomplish the purpose of the work being accomplished by the Force Account Labor are considered within the scope of an ‘infrastructure project’.
Prohibition on Intentional Splitting of Infrastructure Projects
HUD Grantees/Funding Recipients of FFA are prohibited from intentionally splitting an Infrastructure Project to avoid application of the BAP to the project. This precludes the intentional division of procurements, subgrants, cooperative agreements, inter-agency agreements or Force Account Labor projects into separate and smaller awards or contracts to avoid BABA coverage.
Documentation of Compliance
The Notice also offers guidance on documentation of compliance with the BAP and what constitutes adequate records. PHAs are advised to keep records 3 years after the project is completed. For projects that fall within the scope of one of the General Waivers, a copy of the grant agreement showing the size of the grant, or a copy of the procurement contract showing the size of the procurement is less than the small purchase threshold, will suffice for documenting compliance.
A form for manufacturers/resellers to certify that a product complies with BABA is contained in Appendix A of the notice. PHAs can use this form to provide adequate confirmation that a product was purchased in compliance with BABA. Alternatively, PHAs can provide a copy of a label that complies with the requirements of Federal Trade Commission regulation 16 CFR Part 323-Made In USA Labeling. Finally, a PHA can submit a proposal for an alternative way to confirm product compliance with BABA to HUD by email to BuildAmericaBuyAmerica@hud.gov with the comment line “Alternate Product BABA Certification”.
PHAs are also advised to include provisions in procurement solicitations, subgrants, cooperative agreements or inter-agency agreements, to ensure that contractors or other parties involved with PHAs provide sufficient product purchase info to PHAs to ensure documentation of compliance.
Minimum Due Diligence Search Requirements
The Notice contains instructions on what constitutes minimum due diligence searches for micro purchases, small purchases, and purchases that exceed the simplified acquisition threshold amount. If the purchaser is unable to find an available BABA compliant product using standard methods, further searching is required prior to seeking a waiver of the BABA requirements.
Generally, purchasers must search for the product using one of the top five internet search engines or the website of one of the top five home improvement retailers while using one of the following search terms: “made in America” or “made in the USA;” if none of the top results indicate that the product is made in America, the purchaser can submit a waiver request. However, if the search results indicate the product is potentially made in America, the purchaser must the additional step of contacting the producer/reseller of the product by email or by phone to confirm that the product meets the BABA requirements for the product.
Safe Harbor Procurement Strategies
HUD Grantees/Funding Recipients must ensure that all contracts they enter into incorporate requirements to ensure application of the BAP, unless the BAP has been waived for funds utilized in connection with an Infrastructure Project. Two strategies are outlined in the notice: PHAs can either designate BABA-compliant products prior to procurement that contractors must use, or require bidders to submit both BABA-compliant and non-BABA compliant proposals.
Solar Modules where Final Assembly Occurred in U.S. Exempt from BABA
Separately, HUD has approved a BABA waiver for domestically-assembled solar modules. This waiver is effective until December 31, 2025, for all new solar modules with Final Assembly occurring in the United States. Solar modules where final assembly occurred outside the United States are not eligible for coverage under this waiver.
The guidance provided in PIH Notice 2025-06 is subject to change if the Office of Management and Budget (OMB) guidance on the application of BABA in Federal financial assistance (FFA) programs for infrastructure is updated. If you have any questions about BABA or this Notice, contact Malcolm Guy (mguy@clpha.org).
On January 16, 2025, the Full Senate Committee on Banking, Housing, and Urban Affairs held a hearing for Eric Scott Turner’s nomination to be Secretary of the U.S. Department of Housing and Urban Development (HUD). While much of the hearing focused on the lack of affordable housing for homeownership, Democratic Senators grilled Turner on his support for voucher legislation and expansion of the family self-sufficiency program. Turner did not oppose these requests and promised to work with the Senators, though he shied away from specifics throughout the hearing.
Full Committee Chairman Tim Scott (R-SC) raised in his opening remarks his excitement for the potential future of HUD under Scott Turner, President-elect Trump’s nominee to lead the department. Chairman Scott stated that Turner, who worked as the director of the White House Opportunity and Revitalization Council in the first Trump administration, is the Secretary to “forge a new path” for Americans to address the housing affordability crisis. In her opening remarks, Full Committee Ranking Member Elizabeth Warren (D-MA) expressed her concern about the shortage of 7 million affordable homes that are needed for renters across America. Ranking Member Warren prompted Turner in the hearing to share his plans, needing to show the “nuts and bolts” of his potential leadership of HUD operations and his plans to tackle the “enormous task” of solving the affordable housing crisis.
In his opening testimony, Turner declared that HUD’s mission is to support quality affordable housing. He stated that the Department is failing in its basic mission, needing millions of homes of all types to meet demand. He emphasized his work on Opportunity Zones, along with other Trump administration policies, as key to giving underserved communities the ability to be “self-confident” and “self-sustaining.”
The major hearing themes focused on Turner’s belief that HUD needs to cut wasteful spending, maximize current federal budget allocations, and focus on lowering housing costs and building diverse types of housing. Members expressed their concerns about the Trump administration’s first term attempts to underfund the Housing Choice Voucher Program (HCV), HOME Investment Partnership Program and rescind Fair Housing laws.
Senator Chris Van Hollen (D-MD) asked for Turner’s support on advancing his bipartisan housing voucher legislation, the Family Stability and Opportunity Vouchers Act. If enacted, the bill would authorize 250,000 new housing mobility vouchers to end homelessness among families with children. Senator Jack Reed (D-RI) also asked for Turner’s support to improve and expand the Family Self-Sufficiency program.
Senator Ruben Gallego (D-AZ) expressed his concerns about the Trump administration’s position on mixed status families living in federally assisted housing. Turner mentioned that if confirmed, his duty as Secretary is to ensure American citizens are prioritized when receiving federal housing assistance. In response to Turner's remarks, Senator Gallego reminded him that American citizens are a component of mixed status families and that evicting them from their homes would contribute to the rising number of homelessness.
Senator Katie Britt (R-AL) informed Turner that he would inherit the “tremendous problem” of low housing inventory that the Biden administration exacerbated. Turner expressed his approach to building more housing as seeing what HUD programs are “causing us to gain” and “causing us to lose” and then reporting back to Congress the results he found.
Various members from both parties discussed the importance of HUD helping facilitate the building more homes, using federal funding effectively rather than throwing money at affordable housing issues, and reducing barriers to housing development occurring under greater local and state, rather than federal, supervision.