HUD No. 08-157
October 9, 2008
HUD INTRODUCES NEW FINANCING PROGRAM TO EXPAND AFFORDABLE HOUSING IN INDIAN AND ALASKA NATIVE REGIONS
Office of Native American Housing offering free workshops to clarify
process, answer questions
WASHINGTON - The U.S. Department of Housing and Urban Development announced a new program today that will allow Indian tribes and Alaska Native Regional Corporations to issue bonds and secure loans to finance affordable housing opportunities for Native Americans. This new financing program encourages critical private investment necessary to expand affordable housing projects in Indian Country and Alaska.
"Today, we're launching an exciting new financing program that will stimulate more affordable housing in Indian country and Alaska," said Rodger Boyd, Deputy Assistant Secretary for HUD's Office of Native American Program.
"This new financing program will give these communities the financial boost they need to meet their housing development needs."
The Indian Housing Block Grant Leveraging Finance Program (LFP) allows Federally recognized Indian tribes, Alaska Native Regional Corporations, or their tribally designated housing entities (TDHE) to obtain financing for affordable housing projects by pledging a portion of their Indian Housing Block Grants (IHBG), which is annual funding HUD provides these entities to provide a range of affordable housing activities in Indian Country and Alaska.
Specifically, the entity can pledge up to one third of its future IHBG funding to repay the debt on either a bond or
a loan transaction. The financing obtained underthis new program may be used for any allowable affordable housing activity as defined by Native American Housing and Self Determination Act (NAHASDA), which includes developing
or supporting affordable housing for rental or homeownership and providing housing services.
In the coming weeks, HUD will sponsor four free information workshops for tribes, TDHEs, lenders and other financial institutions. To register for the following workshops, go to http://olgclearinghouse.firstpic.org/lfp_training.php:
October 28 - 29 in Acme, Michigan
November 12 - 13 in Denver, Colorado
November 18 - 19, Santa Ana Pueblo, New Mexico
December 2 - 3, Seattle, Washington
HUD specialists will discuss the essential tools needed in order to leverage funds and participate in the program, including acquiring needs assessments, critical partnerships, development models, tribal stakeholder approval, tribal bond financing partners, risk evaluation, cash flow, and debt servicing.
Participants will also be introduced to leveraging concepts such as understanding credit ratings; raising capital through municipal bond markets; evaluating benefits of taxable and tax exempt transactions; and structuring
projects that layer federal funds with private capital. Low Income Housing Tax Credits, HOME funds, Affordable Housing Program dollars from the Federal Home Loan Bank system, and low interest loans and grants from State Housing Finance Agencies are some of the equity resources that make the development of affordable housing
This new program is similar to the Capital Fund Financing Program that's administered by HUD's Office of Public and Indian Housing, which allows non-tribal public housing agencies (PHA) to raise necessary capital in this way. Since 2000, HUD has approved 116 financing proposals submitted by PHAs totaling approximately $3.6 billion.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet