Going Beyond Supply: Choice Neighborhoods and the Future of Public Housing

Dominique Blom, General Deputy Assistant Secretary for Public and Indian Housing

December 22, 2022

HUD plays a critical role in creating and preserving deeply affordable housing. Public housing authorities (PHAs) operate more than 925,000 public housing apartments nationwide, housing hundreds of thousands of families. Much of our public housing requires funding for maintenance and preservation, and one of the most comprehensive ways to strengthen public housing is through the Choice Neighborhoods program. Choice Neighborhoods’ unique combination of housing, people, and neighborhood investments provide severely distressed communities with transformative investments.

Funded through annual appropriations, Choice Neighborhoods is a competitive grant program that provides PHAs, local governments, and tribal entities grants up to $50 million to replace severely distressed HUD-assisted housing with new, high-quality, mixed-income housing. The program also funds companion investments in the surrounding neighborhood and resident supportive services. HUD awards two types of Choice Neighborhoods grants annually: planning grants and implementation grants. Planning grants offer $500,000 to create a community-driven “Transformation Plan” that addresses “Housing, People, and Neighborhood” goals. Implementation grants provide up to $50 million to implement a Transformation Plan. To date, HUD has awarded over $1.3 billion to 44 implementation grantees and $51 million for 108 planning grants. Further leveraging the federal investment, implementation grantees raise an average $7.50 for every $1 in Choice Neighborhoods funds. Accounting for all funding sources, the grantees have already invested $5.75 billion into Choice Neighborhoods with significant further investments planned.

These grants provide a level of investment that many neighborhoods have not seen in generations, including significant boosts in the supply of affordable housing. Choice Neighborhoods implementation grantees replace severely distressed HUD-assisted property within a larger mixed-income community. The 44 implementation grantees are building 14,000 HUD-assisted housing units and an additional 32,000 new mixed-income units. In doing so, grantees preserve deeply affordable HUD-assisted housing while creating additional affordable and unrestricted (“market”) units. More than 10,000 units are already completed, with over 16,000 residents connected to case management to support better employment, education, and health outcomes.

By investing in mixed-income communities, the program supports households with a broad range of incomes. Resident incomes are up in nearly all Choice Neighborhoods sites – in several cases doubling – due to tailored employment programs. Mixed-income housing also pushes for better design, higher quality amenities, and responsive property management that families deserve. All units are built to a market standard, and HUD-assisted units are indistinguishable from others.

In addition, Choice Neighborhoods has catalyzed amenities such as new businesses, parks, and grocery stores. A recent study on the Chicago Choice Neighborhood showed HUD’s investment generated $400 million in additional resources, including funds from Low-Income Housing Tax Credits, New Market Tax Credits, local government, state government, philanthropy, and private lenders. The study found household incomes increased, crime rates fell steadily, and homeownership rates increased.

 

 

HUD is looking to expand the program’s reach to communities of all sizes. For planning grants, HUD doubled the amount available to communities that need resources for community engagement and neighborhood planning.

HUD also published the latest Notice of Funding Opportunity (NOFO) for implementation grants, making an historic $379 million available. The NOFO reinforces our commitment to underserved communities by:

• Maintaining a maximum grant award of $50 million;
• Expanding eligibility requirements for target housing projects and neighborhoods;
• Increasing the amount available for resident supportive services; and
• Allowing applicants to apply for a HUD-assisted housing development that is located in a neighborhood that already received a Choice Neighborhoods implementation grant.

We encourage all communities with a bold vision for the future to review each NOFO and consider applying. These grants offer an unprecedented opportunity to invest in neighborhoods, particularly those that need new housing opportunities most. We know that we must build more housing to address affordability and supply challenges, and Choice Neighborhoods is a key HUD program that provides the resources to do so. On behalf of HUD’s Office of Public and Indian Housing, we are eager to partner with diverse communities to take on the Choice Neighborhoods “Housing, People, and Neighborhood” approach to boosting supply and transforming communities.

Learn more about the FY22 Implementation NOFO, informational webinar, and FAQs here. Applications are due January 11, 2023. HUD will publish the next Planning Grants NOFO shortly after passage of the FY23 federal budget. Sign up for the Choice Neighborhoods newsletter to be the first to find out when the funding announcements, promising practices, and program updates are published.