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Tuesday, May 23, 2006 - House Considers Legislation Dealing with the Section 8 Program

Two pieces of legislation are being considered that deal with Section 8 assisted housing programs. First, legislation has been introduced to extend HUD’s authority to restructure mortgages under the Mark-to-Market program.  Currently, this authority expires on September 30, 2006, but the requirement to reduce rents continues.  IREM is supporting H.R. 5527, which will extend Mark-to-Market authority for five years.  HUD believes an additional 900 properties can be restructured under the program in that time.  IREM is also urging the addition of several provisions in this legislation, including expanding the pool of properties eligible for exception rents, inclusion of properties in disaster areas as eligible for restructuring, and allowing HUD to review early Mark-to-Market deals that were underwritten too tightly, and now face foreclosure.  The House Financial Services Committee is expected to consider the bill in mid-June.

Legislation is also being considered to reform the Section 8 voucher program.  Four years ago the Administration proposed a dramatic reform of vouchers that would block grant the program to housing authorities.  IREM joined many other housing groups to oppose this proposal.  Now, an alternative has been proposed that would make smaller, more reasonable reforms to the program.  These include streamlining physical inspection requirements, and simplifying tenant income verification.   The House Financial Services Committee will consider the bill this month.

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