National Housing Law Project Housing Law Bulletin

Despite a courageous effort by preservation advocates, the final Conference Agreement on FY 1998 appropriations¹ included no funding for the Title VI Preservation program to preserve HUD-subsidized properties with expiring use restrictions. While neither the House nor Senate bills had provided funding, hope remained due to strong bipartisan Senate support. The Senate bill had contained a provision intended to permit the conferees to allocate funds under a revised program.²

At the end of the day, despite continued personal support from a number of the conferees, the Conference decided to provide no funds to preserve this housing. Tenants facing displacement from prepayments will reportedly receive the special "enhanced" tenant-based assistance (covering the new rent level, even if higher than ordinary Fair Market Rents or payment standards) for one year from a different allocation within the appropriation (the Section 8 renewal line). As of press time, it remains unclear whether tenants who already received this special assistance last year will be able to obtain renewals at the higher level.

Some 275 properties nationwide were already approved by HUD for sale to nonprofits and tenant groups and awaiting approximately one billion dollars in funding, with hundreds more properties frozen in HUD processing prior to the approval stage. Many of these properties will convert to market rate through prepayment, some will restructure their financing without Title VI resources and proceed with a watered-down preservation package, and others will probably just sit for awhile longer as owners assess their options.

It was a strong effort to save a lot of good housing. We learned a lot about working together and about politics. Although the program has still not been repealed, without funds it is lifeless. Ten years after the emergency preservation act was first passed, preservation now is either comatose or dead. Because there’s still a need for all of this housing, let’s hold off on the funeral for the time being.

1. H. CONF. REP. NO. 297, 105th Cong., 1st Sess. (Oct. 6, 1997).
2. See the Senate version of H.R. 2158, incorporating S.1034 ("Capital Grants/Capital Loans Preservation Account" and related provisos) as it passed the Senate floor on July 22, 1997, and S. REP. NO. 53, 105th Cong., 1st Sess. (July 17, 1997), at 33.