The Biden administration, through the U.S. Department of Housing and Urban Development, announced new measures to connect families served by HUD programs to solar power and help lower their electric bills.
More than 4.5 million low-income families are currently served by HUD programs. In addition to today’s announcement, HUD will continue to connect and convene stakeholders in regional and local offices to highlight federal funding sources – including funding streams from the Bipartisan Law on President Biden’s infrastructure and HUD programs such as the Home Investment Partnerships Program and the Community Development Block Grant and CDBG which can be used to improve energy efficiency and reduce utility costs for communities , including HUD-assisted properties and residents.
“The combination of extreme heat and rising utility prices creates a perfect storm, and HUD-assisted families and communities are among the most vulnerable,” Secretary Marcia L. Fudge said.
“The measures announced today by the Biden administration will not only help families reduce utility costs, but will also provide HUD-assisted residents with the opportunity to participate in the clean energy economy through local community solar programs.”
Below is information about how HUD will leverage specific programs and take new steps to help ease the burden of energy costs through Community Solar, HUD’s frozen rural small-base utility program, FHA’s 203(k) rehabilitation mortgage insurance program, financing, and FHA’s energy and climate efficiency. Home Improvement Mitigation and FHA Education and Awareness.
New tips for connecting families to solar energy
HUD publishes nationwide guidelines to help ensure residents of supported housing can access cost-effective community solar subscriptions.
With this guidance, HUD is setting the stage for 4.5 million families to enjoy the benefits of community solar power which, on average, can save families 10% annually on their electric bills. In some programs, such as Washington, DC’s Solar for All program, savings from subscribing to local community solar power can be as high as 50% per year.
These national guidelines build on recent state-specific guidelines HUD provided to Illinois, Washington, D.C., and New York City that determined community net metering (CNM) credits would be excluded from calculations. household income and utility allowance and therefore would not increase. housing costs for residents of properties participating in the HUD Multifamily, Public Housing, and Housing Choice Voucher rental assistance programs.
Tips can be found HERE.
Utility program for small frozen rural rolling bases
Last year, HUD implemented new statutory changes creating a new energy and water conservation incentive program for small rural housing authorities.
The Small Rural Frozen Rolling Base program enables small rural housing authorities to retain utility cost savings through efficiency or capital investments in conservation measures.
Now, HUD is launching an educational campaign and partnership to encourage broader use of the incentive and help housing authorities partner with Weatherization providers to access low-cost energy efficiency measures.
HUD will make public a list of eligible rural housing authorities, along with a list of buildings owned or operated by those housing authorities that meet the new income-categorical eligibility requirements for the Department of Environmental Weatherization Program. ‘energy. Prior to the September deadline for new applicants to the Frozen Rolling Base program, HUD will maximize outreach efforts to ensure eligible housing authorities are aware of savings opportunities.
Learn more about the Small Rural Frozen Rolling Base program here and see the list of eligible public housing authorities here. The list of properties meeting the revenue eligibility criteria for the Ministry of Energy’s weatherization program is available here.
FHA 203(k) Rehab Mortgage Insurance Program
In light of the urgent need for utility cost savings, HUD is working to educate lenders and homebuyers about Federal Housing Administration (FHA) products for energy-related improvements that can help homeowners reduce their utility costs.
- The 203(k) Rehabilitation Mortgage Insurance Program is the FHA’s primary program for the rehabilitation and repair of single-family properties. It is flexible and makes it easy to incorporate repair costs into a loan when buying a home or refinancing an existing mortgage. Eligible improvements include energy-efficient upgrades, energy-efficient equipment, and energy production improvements. The 203(k) Limited Mortgage allows buyers and homeowners to finance up to $35,000 on their mortgage to repair, improve or upgrade their home. In Qualified Opportunity Zones (QOZs), the amount can be as high as $50,000 per home, which is enough to make a range of significant and cost-effective energy upgrades.
FHA Education and Awareness
- HUD Homeownership Centers offer training sessions on FHA products, programs, and policies throughout the year, including the 203(k), Energy Efficient Mortgage, Weatherization, and Solar and Wind programs. These training sessions are offered live and can be recorded; an example is the 2022 Training for Single Family Housing Lenders – Credit Underwriting: Session II (located here) conducted in June.
- The FHA is considering ways to make it easier for lenders and consumers to use the 203(k) mortgage rehabilitation program to make a range of home improvements, including those related to climate change mitigation and improving energy efficiency. When these changes are in place, FHA will execute a strong education and awareness plan to inform consumers and lenders.
- FHA works with the appraiser community to develop strategies to ensure single-family appraisers are aware of approaches to appraising energy-related improvements and risk mitigation.
Contact an FHA-approved lender for more information about the Section 203(k) Rehabilitation Mortgage Program or visit HUD’s 203(k) Rehabilitation Mortgage Insurance Program webpage.