FR 2021-02193

The document is a notice from the Rural Housing Service (RHS), a branch of the United States Department of Agriculture (USDA). It is soliciting applications for Section 514 Off-Farm Labor Housing loans and Section 516 Off-Farm Labor Housing grants. These funds are aimed at boosting the supply of affordable housing for domestic farm laborers, including those who are retired or disabled. Through a competitive process, applicants can seek financial assistance to construct new housing units. This opportunity is part of the government's effort to support rural communities and alleviate housing shortages for farm laborers.

General Summary

The notice outlines the requirements for submitting applications, including eligibility criteria, the application process, and deadlines. It specifies the types of housing projects that qualify and the way funds will be distributed. The document places a strong emphasis on encouraging investments in rural areas, particularly in Opportunity Zones and persistent poverty areas. Applicants who align their projects with these goals may receive preferential scoring during the application process.

Significant Issues and Concerns

The document's language is dense and technical. It may be challenging for potential applicants, especially those without a legal or governmental background, to understand fully. The process of applying for funding is complex and involves multiple phases, rounds, and deadline dates, which could discourage participation due to its intimidating nature.

Additionally, the extensive paperwork and documentation required could create significant barriers for smaller organizations or individuals lacking substantial administrative support. This requirement could disproportionately affect applicants from rural areas, who may have limited resources to navigate the complex application process.

The eligibility requirements and prioritization criteria are detailed, but they might inadvertently introduce bias. The scoring and ranking process, with a lottery system to break ties, could also appear subjective or unfair to applicants who do not receive funding.

Impact on the Public

Overall, the notice is part of a broader initiative to enhance affordable housing options for farm laborers. For the general public, especially in rural communities heavily reliant on agriculture, this program aims to improve living conditions. Better housing for workers can lead to more stable communities, which may have positive ripple effects on local economies and services.

However, the rigorous application requirements could deter smaller, potentially less-experienced stakeholders from participating, thus limiting the range of projects funded. States with larger farm laborer populations may feel underrepresented due to the stipulation that limits any state's funding to 30% of the total pool.

Impact on Specific Stakeholders

For non-profit organizations and government agencies eligible to apply, this program presents an opportunity to access substantial funding that could directly impact the availability of housing for farm laborers. Still, the detailed requirements for documented financial commitments, such as Low-Income Housing Tax Credits (LIHTC), could favor applicants with greater financial expertise or resources, potentially reducing competitive fairness.

For applicants lacking robust connections with financial institutions or residing in areas with limited banking services, the demand for letters from credit institutions proving their inability to obtain credit elsewhere could pose a significant hurdle. It may require significant legwork and incur delays, which could prevent some deserving projects from receiving funding.

In conclusion, while the document announces a potentially impactful program aimed at addressing important housing needs in rural America, it also presents significant challenges that could affect its accessibility and effectiveness. Stakeholders and potential applicants need to invest considerable effort and resources to navigate the application requirements fully, which might not be feasible for all interested parties.

The document discusses the solicitation of applications for Section 514 Off-Farm Labor Housing Loans and Section 516 Off-Farm Labor Housing Grants, aiming to enhance affordable housing for farm laborers. Financial aspects play a critical role in this initiative, with various references and requirements outlined throughout the document. Here's how these financial issues manifest and impact potential applicants:

Program Funding and Appropriations

The amount of program dollars available annually is determined by yearly appropriations. This means that the funds available for loans and grants can vary each year based on government budgets. The cap on the maximum award per project is $5 million, including both loan and grant components. This ceiling ensures that resources are distributed across various projects rather than concentrated on a few.

Eligibility and Financial Requirements

Applicants must demonstrate financial need by providing evidence of inability to obtain credit through other sources. This requires letters from at least two financial institutions, indicating the terms on which a loan would be offered. Such requirements could be challenging for applicants without substantial banking relationships or those in rural areas with limited bank access.

Additionally, projects must include other financing sources beyond RHS loans or grants. For instance, the document references leveraging funds such as Low-Income Housing Tax Credits (LIHTC), which might not be accessible to all applicants. The necessity of demonstrating leveraging capabilities could favor those with more financial resources or expertise in handling complex financial instruments.

Application Deadline and Financial Documentation

Applicants incur expenses in preparing pre-applications and final applications, which are at their own risk. The document cites a credit report fee of at least $24, which applicants must pay to the USDA. These costs, while relatively modest, add to the overall administrative burden.

Financial Allocation and State Cap

The document stipulates that no state will receive more than 30% of the Off-FLH funding annually, unless there are remaining funds after all eligible applications are addressed. While this constraint promotes geographical diversity in fund allocation, it may disadvantage states with larger farm laborer populations or more significant housing needs.

Scoring and Competitive Selection Concerns

Scoring criteria consider several financial elements, such as leveraging other funds or operational cost savings, like tax abatements or non-RHS tenant subsidies. Such considerations might put smaller applicants or those unfamiliar with these mechanisms at a disadvantage. Moreover, the transparent scoring process, though detailed, might feel perplexing to applicants, complicating their efforts to understand financial expectations.

Commitment and Compliance

Lastly, the requirement for firm commitment letters from Housing Finance Agencies and other financial partners to be submitted with the pre-application underscores the need for strong financial planning and can lead to exclusion if these letters are delayed.

In summary, the document's financial dimensions encompass funding allocations, eligibility criteria emphasizing financial need, and a competitive application process reliant on comprehensive financial documentation and planning. While these measures aim to ensure proper fund utilization and broad access, the complex financial requirements can pose substantial challenges for less resourceful applicants.