Comment Submitted by Harry Hoffman, Housing Development Consortium Seattle- King County

In FY 2010, Section 8 Income Limits will decrease in many areas across the country, based on HUDs current policy and the current state of our economy. Properties funded with HOME, CDBG, City & County funds, State Housing Trust Funds, Public Housing Vouchers, and even HUD-insured properties with other funding - have rent limits tied to Section 8 income limits. In Washington State, approximately 75% of affordable housing properties have one or more of these sources and must adhere to the strictest income and rent limits. The economic viability of thousands of properties nationwide is potentially at risk due to the unintended consequence of HUDs change to the “Hold Harmless” policy for Section 8. Implementation of MTSP and HERA Special income limits for Tax Credit and Bond financed properties, and a separation from Section 8 Income limits, while well intentioned, is a huge administrative problem that affects public funders, owners, property managers and residents of affordable housing. Banks and investors will not invest in affordable housing properties where rental income may decline after their initial investment. Proposed Solution: In FY2010, impose one set of income limits for all affordable housing programs that continues to employ the hold harmless provision, or alternatively, impose only two sets of income limits: one set of limits for units with direct Section 8 rental subsidy and one set of limits for all other affordable housing programs that employs the hold harmless provision. Publish MTSP Affordable Housing Income Limits or HERA Special Affordable Housing Income Limits for any given county or metropolitan area, regardless of the Placed-in-Service year and apply these to all affordable housing programs, except units with Section 8 rental subsidy.