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Tuesday, November 30, 2010

Section 811 and Other HUD Housing Programs for Persons with Disabilities

Libby Perl
Specialist in Housing Policy

The ability of persons with disabilities to live independently in affordable, accessible housing became a prominent issue starting in 1999 as the result of a Supreme Court decision, Olmstead v. L.C. The court held that institutionalization of persons with mental disabilities in lieu of community-based care may constitute discrimination. Shortly after the Olmstead decision, on February 1, 2001, the President announced the New Freedom Initiative, an effort through multiple federal agencies to ensure full participation in society of persons with disabilities. Part of the New Freedom Initiative was Executive Order 13217, which implemented the Olmstead decision by ensuring (among other things) that all people with disabilities, not just those with mental illness, benefit from community-based treatment.

In order to ensure that persons with disabilities may live in community settings rather than in institutions, affordable and accessible housing is necessary. The Department of Housing and Urban Development (HUD) operates a number of programs that provide housing for persons with disabilities in various ways. The Section 811 Supportive Housing for Persons with Disabilities program provides capital grants and project rental assistance to nonprofit developers of housing targeted specifically to persons with disabilities. Prior to creation of Section 811, persons with disabilities lived together with elderly residents (defined by HUD as households with one or more adults age 62 or older) in developments funded through the Section 202 Supportive Housing for the Elderly program. The project-based Section 8 and Public Housing programs give project owners the option of dedicating facilities to elderly residents, residents with disabilities, or both populations together. Both the Section 811 and Section 8 programs set aside housing vouchers for persons with disabilities. And two HUD block grant programs—HOME and the Community Development Block Grant—may be used by states and communities to construct or rehabilitate housing for persons with disabilities.

In addition to these HUD programs, the Low Income Housing Tax Credit (LIHTC), administered by the Internal Revenue Service, may be used by states to target housing to special needs populations, including persons with disabilities. The LIHTC may be used in conjunction with HUD grants, including capital grants through the Section 811 program. The Housing and Economic Recovery Act of 2008 (P.L. 110-289) made it possible for developers of Section 811 housing to qualify for a higher tax credit rate, which could potentially make these mixed financing developments more feasible.

In the 111
th Congress, two similar bills to make changes to the Section 811 program, both called the Frank Melville Supportive Housing Investment Act, were introduced in the House (H.R. 1675) and Senate (S. 1481). On July 22, 2009, the House passed H.R. 1675 under suspension of the rules, and on September 30, 2010, the Senate Banking Committee ordered S. 1481 to be reported. Among the changes proposed by the two bills are turning over funding of Section 811 vouchers to the Section 8 program; creating a demonstration program in which Section 811 rental assistance would be used in conjunction with other sources of financing, including the LIHTC and HOME program; reducing the concentration of housing units for persons with disabilities by limiting the units in multifamily housing dedicated to persons with disabilities to 25% of the total; and delegating the processing of mixed finance developments to state housing finance agencies.

Date of Report: November 18, 2010
Number of Pages: 38
Order Number: RL34728
Price: $29.95

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