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Developers and owners of affordable housing can play a critical role to help create decent, safe, affordable and accessible permanent supportive housing for non-elderly people with disabilities.

Recently enacted legislation modernizing the U.S. Department of Housing and Urban Development (HUD) Section 811 Supportive Housing for Persons with Disabilities program provides a new opportunity for affordable housing developers to create integrated supportive housing opportunities for this population.

What is Integrated Supportive Housing?

The Americans with Disabilities Act (ADA), as interpreted by the U.S. Supreme Court's Olmstead decision, requires public entities such as states to administer services, programs, and activities in the most integrated setting appropriate to the needs of individuals with disabilities. Supportive housing is an evidence-based, cost-effective approach which combines permanent affordable rental housing with voluntary, flexible and individualized services to assist the most vulnerable people with disabilities to live in the community. Using the new Section 811 integrated model, supportive housing units are included in high quality affordable rental properties that primarily assist households without disabilities. To maximize opportunities for community integration, this new Section 811 approach requires that no more than 25% of the units in any Section 811 funded property be set aside for people with disabilities.

Role of Housing Developers

Responding to the increasing demand for supportive housing units, state housing finance agencies (HFAs) in several states have already implemented the integrated approach that is now the centerpiece of new HUD Section 811 policy. These states created supportive housing units for people with disabilities by including incentives or requirements in their Qualified Allocation Plan (QAP) for the federal Low Income Housing Tax Credit program and/or their HOME-funded rental housing strategy. Affordable housing developers in these states were either required or could receive incentive points for setting aside a minimum percentage (i.e., 5-10 %) of the units in an affordable rental property for occupancy by people with disabilities. Partnerships were also formed between HFAs and state health and human service agencies to ensure referrals to set aside units and secure commitments of supportive services for tenants.

New Section 811 Opportunities for Developers

HUD's Section 811 Program is a critical supportive housing program that assists the lowest income people with significant and long-term disabilities to live independently in the community by providing affordable housing linked with voluntary services and supports.

The Frank Melville Supportive Housing Investment Act of 2010 reformed the Section 811 Program by authorizing a systematic and state-oriented approach to the creation of integrated supportive housing units.

The most significant Melville Act innovation is the new Section 811 Project Rental Assistance (PRA) authority which - for the first time - provides cost-effective PRA subsidies directly to state HFAs. Subject to appropriations, HUD will make the PRA option available to HFAs for the first time during FY 2012. Eligible projects proposed by nonprofit or for-profit developers will be selected by the HFA and can be either new or existing multifamily developments. The Melville Act also authorized the Multifamily Capital Advance/Project Rental Assistance Contract (PRAC) option which modernizes the traditional Section 811 model by providing capital as well as project rental assistance to nonprofit organizations for the creation of integrated supportive housing units.

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