The Melville Act authorizes a new and innovative Section 811 Project Rental Assistance (PRA) option to promote the creation of integrated permanent supportive housing units. The PRA option is the first federal 'stand alone' project-based rental assistance approach to help governments systematically and efficiently create integrated and highly cost-effective supportive housing units in affordable rental housing developments. Section 811 PRA units are projected to cost 60-80% less than traditional Section 811 units - and will leverage the development of thousands more units of permanent supportive housing each year.
According to the statute, eligible applicants for PRA funds are state Housing Finance Agencies (HFAs) and other appropriate entities. The PRA option also requires that a formal Section 811 partnership be established between the eligible applicant for the PRA funds and the state health and human services agency responsible for the administration or supervision of the State Plan for medical assistance under title XIX of the Social Security Act (i.e., the State Medicaid Plan).
PRA funds can only be used as rental assistance. Capital Advances are not an eligible activity.
Eligible projects will be selected by the State HFA (or other eligible applicant as determined by the HUD Secretary) and can be either new or existing multi-family developments in which the development costs are paid for with other public or private sources, including projects that have a commitment of federal Low Income Housing Tax Credits, HOME funds, or other commitments of funding from federal, state, or local government or any other source. Project owners can be nonprofit or for-profit developers.
A household composed of one or more persons with a disability who is at least 18 years of age and less than 62 years of age, is extremely low-income (30% AMI), and who can benefit from the supportive services offered in connection with the housing.
How Integration is Achieved
To ensure community integration goals are achieved under the PRA option, the statute specifies that the number of units of supportive housing for persons with disabilities (including those to which any occupancy preference for person with disabilities applies), in any multifamily housing project containing PRA funds, may not exceed 25% of the total units in the housing project.
PRA units must be operated as supportive housing for persons with disabilities for not less than 30 years.
The PRA option requires a joint state agency partnership, between the state HFA (or other appropriate entity as determined by the HUD Secretary) and the state health and human service agency as well as (if different) the state agency responsible for the administration of the State Medicaid Plan. The HFA must have a formal written agreement with the state health and human service/Medicaid agency. This agreement must address:
- The target population to be served
- Outreach and referral methods for reaching the target population
- Supportive service commitments for tenants.
The PRA option requires that Section 811 units are set-aside in new or existing multi-family developments in which the development costs are paid for/leveraged from other public or private sources, including projects that have a commitment of federal Low Income Housing Tax Credits, HOME funds, or other commitments of funding from federal, state, or local government or any other source. Capital advances are not allowed under the PRA option.
Contract Term & Funding
HUD's PRA contract will have a term of not less than 15 years. The contract provides funding for 5 years, with renewal funding subject to appropriation.