Rebuilding Indiana Monthly: May 2009 Edition

The 2009 regular session of the Indiana General Assembly adjourned in dramatic fashion near midnight on Wednesday, April 29. All Indiana Association for Community Economic Development's (IACED) members should have received a copy of the legislative wrap-up. If you did not, please contact me. As you read in the wrap-up, not all legislative business was concluded and there will be a special session called by Governor Mitch Daniels in the coming days. Left unresolved, the FY 2009-2011 biennial state budget.

During the regular session, IACED monitored and supported bills related to a variety of community economic development industry concerns. IACED worked diligently to help secure passage of legislation containing a comprehensive package of reforms to address the continuing mortgage foreclosure crisis. On its final day of the regular session, the General Assembly passed foreclosure prevention legislation in the form of Senate Bill (SB) 492. Efforts to reach foreclosure prevention agreements are funded by an additional $50 fee on mortgage foreclosure filing. The legislation takes effect July 1, 2009.

House Bill (HB 1063) passed allowing an emergency shelter or a program providing services to homeless or low income individuals to provide shelter and certain other related services to a child without the permission of the child's parent, guardian, or custodian. The bill also provides immunity from civil liability for a youth shelter and its director, employees, agents, and volunteers for any act or omission related to admitting, caring for, or releasing a runaway or homeless youth.

Unfortunately, legislation to protect tenants in foreclosed properties did not become law in Indiana. However, as of May 20, federal legislation has been signed by the President to require 90 days notice to tenants, unless a person purchasing a foreclosed property plans to occupy it themselves. More details about this legislation S. 892 is included below in the article Helping Families Save Their Home Act.

The General Assembly special session outcome was the result of $100 million dollars of disagreement between the legislature and the Governor. All indications are the special session budget bottom line will have to be pared back even further as state revenues show further declines in the current biennium, the end of which will serve as the baseline for the FY 2010-11 biennium budget. It appears the legislature and Governor have agreed to a process to guide special session consideration of the budget. The key components of the process are a new revenue forecast, the most detailed budget proposal ever requested of a governor, and the reconvening of the General Assembly to react to the Governor's proposal and adoption of a negotiated budget. There is talk the Governor's proposal may slice $1 billion out of the budget. This will make the special session interesting given the disagreement at the end of the regular session was $100 million in cuts. The anticipated timeline for the special session will follow a course which includes:

May 12 - State Budget Committee meets
June 1 - Governor's administration's budget will be presented to Special Budget Sub-Committee
June 1-15 - the Special Budget Sub-Committee will meet between June 1-15 to consider the administration's proposal.
June 15 - Special Session Convened (tentative date until called by Governor)

IACED will closely monitor the special session and protect members' interest in key programs to build assets for Hoosiers and revitalize communities.

In other news, IACED's membership as of May 15 numbers 241. Membership applications from the Indiana Coalition on Housing and Homeless Issues (ICHHI) membership arrive daily. Fifty two percent (52%) of former ICHHI members applied for IACED membership since March 20, 2009. Seventy-six percent (76%) of IACED's 2008 membership have renewed. Also in membership news, the eleven (11) Homeward Bound walks across Indiana have raised $225,688 as of May 15. Donations to local walks are down statewide this year. Chairs of the local walk report the state of the economy has had a negative impact on their ability to obtain donations.

Lastly, IACED Program Manager Naila Carnagua passed the Community Development Block Grant (CDBG) Grant Administrator Certification course in April. Congratulate Naila when you see her. This certification is another resource for IACED members. If you have any questions about IACED's work or if we can assist you, do not hesitate to contact us at 317-920-2300.

Sincerely,
Andy Fraizer Signature

Andy Fraizer

IACED TA: HOME & CDBG Applications

IACED will offer members one (1) hour of free technical assistance in reviewing HOME & CDBG applications for 2009. Any assistance needed above one hour can be contracted/billed at the discounted member rate. For more information or questions, please contact David Fredricks at dfredricks@iaced.org or 317-920-2300, Ext 13.

Training and Events

Training Updates

Sustainable Development Training: LEED-ND, New Urbanism, and Smart Growth for the Non-profit Developer

Where: Indiana State Teacher's Association (ISTA), 150 W. Market Street, Indianapolis, IN, 46204

When: May 26-27, 2009, 9:00am - 5:00pm EDT

Fee: $35

Contact: Naila Carnagua, IACED, 317-920-2300 ext. 17 or ncarnagua@iaced.org

Downtown Development and Rehab Training: Go to Goshen!

Where: Municipal Annex Building (Conference Room), 204 E. Jefferson St. Goshen, IN 46528

When: June 9, 2009, 10:00am - 4:30pm (CST) and June 10, 2009, 9:00am - 4:30pm (CST)

Fee: $45

Contact: Naila Carnagua, INCAA, 317-920-2300 ext. 17 or ncarnagua@iaced.org

Advanced Foreclosure Training

In this course, case studies will be utilized. Participants will learn the mechanics of an FHA, VA and RHS workout; how to proceed with a short sale, legal protection against foreclosure and life after foreclosure.

Where: The training will be held at the Indiana Housing and Community Development Authority located at 30 South Meridian Street, Suite 1000, (10th Floor) Indianapolis, 46204.

When: June 23-24, 2009

Registration will begin at 8:30 am on Tuesday. Training will be from 9:00 am - 4:30 pm both days.

Fee: $40.00 - IFPN, HomeEC or IACED members;

$100.00 - All other Not-for-Profit Organizations;

$195.00 - For Profit Organizations.

Local News

Commercial Corridor Revitalization

In an article titled "Love at First Site: Public-Private Partnerships are Helping Disenfranchised Neighborhoods Restore their Beauty and Attract a New Generation of Investors and Residents," American City and County magazine describes successful partnerships for commercial revitalization. The article discusses Indianapolis' successful Fostering Urban Commerical Strategies (FOCUS) program. You can link to the article here.

Policy and Research

Policy Driven Research: Housing Affordability

Housing affordability is an important public policy issue which directly affects homelessness. Irrespective of the presence of any other factor, homelessness is caused by a lack of access to affordable housing.

Each year the National Low Income Housing Coalition (NLIHC) releases Out of Reach, a report on housing affordability among renters in the United States. Specifically this report examines how much a household must earn to reasonably afford the most modest housing unit; and whether a worker earning the minimum wage could afford housing. According to NLIHC, in 2009, a household would have to earn at least $37,105 to reasonably afford a two-bedroom apartment at the national average fair market rent. This translates into a "Housing Wage" of $17.84. A Housing Wage is the hourly rate that a worker needs to earn to be able to reasonably afford a modest housing unit. This Housing Wage exceeds the average hourly wage of renters ($14.69), and is more than double the recently-increased national minimum wage ($6.55). Despite recent increases in the minimum wage, there is still no county in the United States where a one-bedroom unit is affordable to a full time worker earning the minimum wage.

In Indiana, the Fair Market Rent (FMR) for a two-bedroom apartment is $697. In order to afford this level of rent and utilities, without paying more than thirty percent (30%) of income on housing, a household must earn $2,324 monthly or $27,892 annually. This level of income translates into a Housing Wage of $13.41.

In Indiana, a minimum wage worker earns an hourly wage of $6.55. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 82 hours per week, 52 weeks per year. Or, a household must include 2.0 minimum wage earner(s) working 40 hours per week year-round in order to make the two bedroom FMR affordable.

In Indiana, the estimated mean (average) wage for a renter is $11.90 an hour. In order to afford the FMR for a two-bedroom apartment at this wage, a renter must work 45 hours per week, 52 weeks per year. Or, working 40 hours per week year-round, a household must include 1.1 worker(s) earning the mean renter wage in order to make the two-bedroom FMR affordable.

Monthly Supplemental Security Income (SSI) payments for an individual are $674 in Indiana. If SSI represents an individual's sole source of income, $202 in monthly rent is affordable, while the FMR for a one-bedroom is $573.

Priced Out is a biennial report produced by the Technical Assistance Collaborative that examines the affordability of housing for people who rely solely on disability income. This report uses monthly Supplemental Security Income (SSI) information for persons with long-term disabilities and compares that to the local fair market rent (FMR) to determine whether a single person household relying on SSI could afford housing. In 2008, the national average FMR for a one-bedroom unit consumed more than the entire monthly SSI payment. That is, the SSI monthly income amount did not cover the national average rent for the most modest housing unit. Further, there is not one place (metropolitan or rural) in the country where housing at the FMR was affordable to someone relying solely on SSI.

Helping Families Save Their Homes Act (S. 896) Becomes Law: Enhances Foreclosure Prevention, Reauthorizes Homeless Programs, and Protects Tenants in Foreclosure

On May 20, President Obama signed S. 896, The Helping Families Save Their Homes Act. This legislation expands the reach of federal housing affordability and foreclosure prevention programs and modifies how the U.S. Department of Housing and Urban Development (HUD) homeless programs. The signed legislation included the language of the Homeless Emergency Assistance and Rapid Transition to Housing (HEARTH) Act, which had been moving through the Congress as a separate piece of legislation.

Major provisions of the Helping Families Save Their Homes Act and HEARTH legislation include the following:

Expand Access To The HOPE For Homeowners Program

The legislation updates the Hope for Homeowners Program to make it more user-friendly and effective, including: lowering fees, streamlining borrower certification requirements, banning millionaires from the program, and allowing for incentive payments to servicers and originators to participate in the program.

Specifically, the bill would put the HUD Secretary in charge of running the program, relegating the Program Board's role to an advisory capacity. The upfront fees on the loans are modified. Other regulatory changes include requiring the HUD Secretary to weigh both the financial integrity of the program and the bill's purposes of foreclosure prevention in setting premiums. The legislation also changes the provision for HUD to receive fifty percent (50%) of appreciation profit sharing to authorize "up to 50%" of such profit sharing and allow HUD to share this profit with the existing first or subordinate lienholders to induce loan writedowns. The Helping Families Save Their Homes Act permits payments to servicers of existing mortgage loans on the property and to underwriters of the new Federal Housing Administration (FHA) loan for each successful refinance.

The bill provides a safe harbor from liability to mortgage servicers and related persons to the extent the person's cooperation is required to allow the servicer to engage in loan modifications, as long as the servicer provides a modification consistent with the program.

Administrative changes with the program include requiring conformity to FHA single family procedures, and standards as much as possible. Other administrative changes include:

modifying current debt income affordability test to apply it at the time of the new loan application

modifying certification of no intentional default on other debts so that it now applies "to any other substantial debt" within the last five years

providing for less prescriptive language regarding collection of income tax returns

eliminating extraneous loan-to-value restrictions on use of second lien loans to maintain property

barring borrowers with a net worth of more than $1 million.

The Helping Families Save Their Homes Act contains provisions to better ensure that predatory lending entities and individuals are not allowed to participate in the FHA home mortgage insurance program.

Increase Funding For Foreclosure Prevention By $130 Million

The bill includes an additional $130 million for foreclosure prevention efforts including counseling, additional fair housing field employees, and educating the public about foreclosure scams.

Establish Protections for Renters Living in Foreclosed Homes

The bill provides renters whose landlords have lost their properties to foreclosure the right to stay in the home for 90 days after the foreclosure or through the term of their lease unless the property is sold to someone who will occupy the home. The bill will also provide similar protections to housing voucher holders. The National Low Income Housing Coalition estimates that forty percent (40%) of the households who lose their homes because of foreclosure are renters.

Reauthorizes HUD McKinney-Vento Homeless Programs

The HEARTH Act is the first significant reauthorization of the McKinney-Vento Homeless Assistance programs in nearly 20 years and allocates millions more to homelessness prevention, rapidly re-housing homeless families, and providing permanent supportive housing for homeless people with disabilities. It also modernizes and streamlines housing and services to more efficiently meet the needs of people seeking assistance. The bill consolidates homeless programs to improve effectiveness and streamline administration. It focuses resources on the fastest growing segment of the homeless population - families with children - as well as the chronically homeless. It also authorizes $2.2 billion for homeless programs.

The HEARTH Act portion of the legislation:

allows up to 20 percent of funds to be used to prevent homelessness or rapidly re-house people who become homeless through the new "Emergency Solutions Grants" (formerly Emergency Shelter Grants)
consolidates the Supportive Housing Program, Shelter Plus Care, and the Moderate Rehabilitation/Single Room Occupancy Program into a single Continuum of Care program
increases the emphasis on performance by measuring applicants' progress at reducing homelessness
requires that HUD provide incentives for proven solutions, including rapid re- housing programs for homeless families and permanent supportive housing for chronically homeless individuals and families
requires HUD to write implementing regulations that will allow for public comment and discussion, instead of imposing new policies by agency fiat through the annual grant application (NOFA) process
designates 30 percent of total funds for new permanent housing for families and individuals with a disability;
simplifies the requirement for matching funds
expands the definition of homelessness
allows grantees to use up to an additional 10 percent of competitive funds to serve families defined as homeless under the Department of Education (but not HUD)
creates the Rural Housing Stability Assistance Program, which would grant rural communities greater flexibility in utilizing Homeless Assistance Grants and allow them to use more funding for capacity building

Nan Roman, president of the National Alliance to End Homelessness, commended the nation's leadership for passing the HEARTH Act. "Today, we seize a rare opportunity to truly transform the way we help those most in need of our assistance," said Roman.

Jeremy Rosen with the National Policy and Advocacy Council on Homelessness (NPACH) said, "Over the course of NPACH's existence, we have raised a range of concerns about federal policy on homelessness. We have been concerned about the focus on long-term single adult homelessness, without a corresponding focus on children, youth, and families. We have been troubled by top-down policy created in Washington, with little understanding of local needs...The new legislation takes steps to address many of these concerns."

Homelessness

Additional Housing Vouchers needed to Stem Increase in Homelessness

During the last three recessions, the number of Americans living in poverty - and the number living below half of the poverty line - has risen markedly, with the largest increases occurring in recessions with the highest unemployment. Families with incomes below half of the poverty line face the greatest risk of becoming homeless, as they have the most difficulty paying rent.

As job losses have mounted in recent months, rising numbers of families are falling into poverty and losing their homes. Created in the 1970s, the Housing Choice Voucher Program has become the dominant form of federal low-income housing assistance. Currently, about 2 million low-income families use vouchers to help pay for housing they find in the private market.

Housing vouchers are flexible, cost-effective, and successful in making rental housing affordable even for families with very low incomes, and numerous studies show they can play a critical role in reducing homelessness among families with children. Because families can use vouchers almost immediately, vouchers can rapidly address rental housing needs when homelessness is rising.

Until recently, Congress made substantial annual investments to expand rental assistance, funding an average of about 80,000 new vouchers every year from 1976 to 2002. Congress funded no new vouchers, however, during the five years from 2003 to 2007 - even though the number of poor households spending at least half of their income for housing increased by 940,000, or 25 percent, during this period.

To alleviate the current increase in homelessness and reduce homelessness over the longer term, the National Low Income Housing Coalition recommends the federal government expand the voucher program. Congress could start by funding 200,000 new housing vouchers this year as part of the 2010 HUD appropriations act or a 2009 supplemental spending bill.

To read the full report click here.

Homeward Bound

This month walkers from around the state will once again take part in Homeward Bound: Indiana's 5K Walk Series to Provide Housing and Fight Homelessness. Homeward Bound, a project of the Indiana Association for Community Economic Development (IACED), is a series of annual walks which take place in communities throughout the state. The walks raise money and awareness about affordable housing and homeless needs in Indiana.

Since its inception in 2003, Homeward Bound has raised nearly $2.5 million for more than 90 affordable housing and homeless service providers around the state. In 2008 alone, Homeward Bound raised nearly $425,000, making it Indiana's largest grassroots fundraiser to engage the public in efforts to end homelessness and provide affordable housing. IACED Executive Director, Andy Fraizer said, "The Homeward Bound walks are a clear demonstration of Hoosiers' commitment to ending the plague of homelessness and providing shelter to all families." Homeward Bound is one means by which IACED supports its more than 200 member organizations across the state dedicated to improving lives through community economic development.

This year Homeward Bound walks will take place in the following eleven communities:

Bloomington 4/19/09
Wabash Valley (Terre Haute) 4/19/09
Delaware and Madison Counties
(Chesterfield) 4/26/09
Greater Lafayette 4/26/09
Northeastern (Fort Wayne) 4/26/09
St Joseph County (South Bend) 5/9/09
Howard and Tipton Counties (Tipton) 5/30/09
Southwestern (Evansville) 6/13/09
Central (Indianapolis) 6/14/09
Elkhart County 6/20/09
La Porte County (Michigan City) 9/26/09

To find our more information about a walk site near you, become a sponsor, or donate, visit the Homeward Bound website at: http://www.homewardboundindiana.org/.

Housing

New Study Ranks Housing Affordability
Courtesy of the Center for Housing Policy

Despite declining home prices, many of the jobs created through the federal stimulus package do not pay enough to afford a home,according to Paycheck to Paycheck: Wages and the Cost of Housing in America.

This new study compares housing costs in more than 200 U.S. metropolitan areas with the wages earned by workers in 60 occupations and was released today by the Center for Housing Policy, the research affiliate of the National Housing Conference. In particular, the study takes an in-depth look at housing affordability for five construction-related occupations that may see a boost from the stimulus package, including construction managers, carpenters, equipment operators, long haul truck drivers and construction laborers.

For all of these occupations, except construction managers, homeownership remains unaffordable, even after the recent drop in home prices. Construction laborers also struggle to pay rents in three out of four markets studied, while equipment operators and long-haul truck drivers are unable to afford rents in approximately one-fourth of the markets.

The Future of Fair Housing

Courtesy of Indiana Governor's Council for People with Disabilities

In 2008, the National Commission on Fair Housing and Equal Opportunity was formed by the National Fair Housing Alliance and several other organizations as a bipartisan commission to investigate the state of U.S. housing. the group traveled across the nation to collect information and held hearings in Chicago, Houston, Los Angeles, Boston and Atlanta. The results were gathered in a report titled "The Future of Fair Housing".

Although some progress has been made in expanding housing options for people with disabilities, research has shown that discrimination is still common. In fact, according to the report, net measures of systemic discrimination against persons with disabilities are generally higher than net measures of discrimination on the basis of race and ethnicity. In 2007, 47 percent of cases filed with the U.S. Department of Housing and Urban Development (HUD) were disability discrimination complaints, according to the report.

Using its findings, the commission developed several recommendations, including:

Create an independent Fair Housing Enforcement Agency to replace the existing fair housing enforcement structure at HUD, which was the most consistent them of the commission's hearings.
Revive the President's Fair Housing Council, which coordinates fair housing policies and practices across agencies.
Ensure and strengthen compliance with the "Affirmatively Furthering Fair Housing" Obligation, which refers to the federal government's responsibility to take proactive steps to advance fair housing opportunities, not just to avoid discrimination.
Strengthen the Fair Housing Initiatives Program (FHIP) with more funding. FHIP is intended to support and fund fair housing enforcement and education across the country.
Adopt a regional approach to fair housing by coordinating the efforts of all jurisdictions in a metropolitan area.
Ensure that fair housing principles are emphasized in programs addressing the mortgage and financial crisis.
Create a strong, consistent fair housing education campaign, backed by federal government support, that will spread the message of housing issues nationwide.
Create a new collaborative approach to fair housing issues that establishes best practices and effective strategies.

The report also stressed the necessity of fair housing research, including disability data. As people with disabilities continue to move into communities, and housing programs are developed to meet their specific needs, assessment of the numbers of people and the types of housing they need will become increasingly important. To view the full report, visit www.nationalfairhousing.org.

HUD Launches Interactive Foreclosure Map

Courtesy of HUD

Visit the new HUD Interactive Foreclosure Map, search by City, State or Zip Code to find foreclosure information. The search details will provide you with a foreclosure risk score and vacancy risk score. The search will break down the area into Census tracts, displaying the average risk score for selected tracts.

Community Economic Development

Leaders for Communities

LeadersforCommunities.org is a new professional networking site for leaders in the community development field to connect with each other and share knowledge, resources, tools and job opportunities. LeadersforCommunities.org has been developed to facilitate communication across all types of community development organizations, and among people with diverse backgrounds and skill sets. The site - with easy-to-use functionality similar to Facebook, but featuring a specific focus on community development issues - is designed to be a rich source of innovative ideas, answers to tough community development challenges and career growth resources.

There is no cost to participate, and members can access and post job listings, participate in discussions, join affinity groups and share and view resources, links and events recommended by peers.

Join LeadersforCommunities.org today to grow your effectiveness and your career.

Nonprofits Don't Include Enough Information for Donors

Courtesy of Guidestar.org

A new review by Guidestar.org reports nonprofits do not include enough key information for donors. The report suggests that charities regularly update their websites with details of their programs and evaluation metrics about their program effectiveness in addition to brief bios of leaders, annual reports, audited financial statements, and their IRS letter of determination. Free report.

State Internet Research Repository

Courtesy of the National Low Income Housing Coalition