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Wednesday, August 21, 2013

The HUD Homeless Assistance Grants: Programs Authorized by the HEARTH Act

Libby Perl
Specialist in Housing Policy

The Homeless Assistance Grants, administered by the Department of Housing and Urban Development (HUD), were first authorized by Congress in 1987 as part of the McKinney-Vento Homeless Assistance Act (P.L. 100-77). Since their creation, the grants have been composed of three or four separate programs, though for the majority of their existence, between 1992 and 2012, the grant programs were unchanged. During this time period, there were four programs authorized and funded by Congress: the Emergency Shelter Grants (ESG), the Supportive Housing Program (SHP), the Shelter Plus Care (S+C) program, and the Section 8 Moderate Rehabilitation for Single Room Occupancy Dwellings (SRO) program. Funds for the ESG program were used primarily for the short-term needs of homeless persons, such as emergency shelter, while the other three programs addressed longer-term transitional and permanent housing needs.

The composition of the Homeless Assistance Grants changed when Congress enacted the Homeless Emergency Assistance and Rapid Transition to Housing (HEARTH) Act as part of the Helping Families Save Their Homes Act in the 111
th Congress (P.L. 111-22). The HEARTH Act renamed the ESG program (it is now called the Emergency Solutions Grants) and expanded the way in which funds can be used to include homelessness prevention and rapid rehousing (quickly finding housing for families who find themselves homeless), and it consolidated SHP, S+C, and SRO into one program called the Continuum of Care (CoC) program. A third program carved out of the CoC program to assist rural communities―the Rural Housing Stability Assistance Program―was also created by P.L. 111-22. In addition, the HEARTH Act broadened HUD’s definition of homelessness. The changes in P.L. 111-22 have repercussions for the way in which funds are distributed to grantees, the purposes for which grantees may use funds, and who may be served.

HUD began to implement the ESG program in FY2011 and the CoC program in FY2012, and it released proposed regulations for the Rural Housing Stability (RHS) grants in March 2013 (and has not yet provided RHS grants). Funds for the ESG program, in addition to being available for homelessness prevention and rapid rehousing, can be used for emergency shelter and supportive services. CoC program funds can be used to provide permanent housing, transitional housing, supportive services, and rapid rehousing. Once the RHS program is implemented, rural communities will have greater flexibility in who they are able to serve (those assisted may not necessarily meet HUD’s definition of “homeless individual”), and may use funds for a variety of housing and services options.

HUD uses one method to distribute funds for the ESG program and another method to distribute funds for the CoC program. The ESG program distributes funds to states, counties, and metropolitan areas using the Community Development Block Grant (CDBG) program formula, while the CoC grants are distributed primarily through a competitive process, though the CDBG formula plays a role in determining community need. Rural communities may opt to receive competitive funding through the RHS program rather than through the CoC program.

Funding for the Homeless Assistance Grants has nearly doubled since FY2000, reaching $1.9 billion in FY2013 (see Table 2). Despite funding increases, the need to renew existing grants required nearly 90% of the competitive grant allocation in FY2011, and in FY2012 HUD was initially uncertain whether CoC program funding would be sufficient to renew existing grants.

Date of Report: August 9, 2013
Number of Pages: 39
Order Number: RL33764
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