FY24 Pathways to Removing Obstacles to Housing (PRO Housing)

Communities nationwide are suffering from a lack of affordable housing, and housing production is not meeting the increasing demand for accessible and available units in many urban and rural areas, particularly areas of high opportunity. Pathways to Removing Obstacles to Housing (PRO Housing) empowers communities that are actively taking steps to remove barriers to affordable housing and seeking to increase housing production and lower housing costs over the long term. Barriers to affordable housing may take the form of restrictive zoning designations, land use policies, or regulations; discretionary, costly or prolonged procedures; deteriorating or inadequate infrastructure; lack of neighborhood amenities; neighborhood opposition to new or affordable housing; or challenges to preserving existing housing stock such as increasing threats from natural hazards, redevelopment that reduces the number of affordable units, displacement pressures, or expiration of affordability requirements.Across the United States, regulatory and other barriers have made it difficult to produce, preserve, and access affordable housing. Constrained supply drives up housing costs and reduces affordability. According to American Community Survey estimates in 2021, 39.3 million households (20.9 million renters and 18.4 million homeowners) have been classified as “cost-burdened,” spending more than 30 percent of their income on housing. Cost burden is even greater for underserved populations. Black families face affordability challenges as homeowners and renters more than any other racial or ethnic group, spending between 30 to 50 percent of their income on housing. In Puerto Rico, cost-burdened households face severe affordability challenges, spending between 50 to 90 percent of their income on housing. Limited access to housing has long-term effects on access to opportunity and ability to build generational wealth, especially for underserved communities of color and low-income people. Affordability challenges and the lack of affordable housing supply further increase eviction pressures and likelihood of homelessness for low-income people.In 2024, HUD awarded the inaugural PRO Housing competitive grants to 21 winners to advance housing opportunities in communities across 19 states and the District of Columbia. The first-round competition was greatly oversubscribed. For every dollar made available for fiscal year 2023, thirteen dollars were requested. HUD received over 150 applications from nearly every state and territory. The considerable interest in this first-of-its-kind funding is an indication of the need for resources to address barriers to housing production and preservation across the county. The applicants and winners represent rural, suburban, and urban communities ranging from under 5,000 residents to millions. While communities have seen historic levels of federal investments in housing and infrastructure, there is still a need to address the barriers that inhibit or slow housing production. Barriers such as high cost of land, lack of available units, inadequate infrastructure, gaps in financing, restrictive zoning, risks of displacement, expiring affordability, and increased threats from extreme weather and an aging housing stock were common themes throughout the initial applications. PRO Housing funding enables awardees to address those barriers through planning, infrastructure, development, and preservation actions to further local housing goals.HUD is issuing this second PRO Housing NOFO under the authority of the Consolidated Appropriations Act, 2024 (Public Law 118-42, approved March 9, 2024) (Appropriations Act), which appropriates $100 million for competitive grant funding for the identification and removal of barriers to affordable housing production and preservation. Congress has directed HUD to undertake a competition using the Community Development Block Grant (CDBG) statutory and regulatory framework. Under this NOFO, HUD will provide PRO Housing grants to identify and remove barriers to affordable housing production and preservation. Grantees may use awards to further develop, evaluate, and implement housing policy plans, improve housing strategies, and facilitate affordable housing production and preservation. Eligible applicants are State and local governments, metropolitan planning organizations (MPOs), and multijurisdictional entities.HUD has six goals for this competition:Fairly and effectively award the PRO Housing grant funding;Elevate and enable promising practices dedicated to identifying and removing barriers to affordable housing production and preservation, while preventing displacement;Institutionalize state and local analysis and implementation of effective, equitable, and resilient approaches to affordable housing production and preservation;Provide technical assistance to help communities better fulfill the Consolidated Plan’s requirement of identifying barriers to affordable housing and implementing solutions to address these barriers;Affirmatively further fair housing by addressing and removing barriers that perpetuate segregation, inhibit access to well-resourced areas of opportunity for protected class groups and vulnerable populations, and concentrate affordable housing in under-resourced areas; andFacilitate collaboration and harness innovative approaches from jurisdictions, researchers, advocates, and stakeholders.HUD will prioritize applicants that demonstrate: (1) progress and a commitment to overcoming local barriers to facilitate the increase in affordable housing production and preservation, primarily by having enacted improved laws and regulations that HUD reasonably expects to preserve or produce new housing units; and (2) an acute need for housing affordable to households with incomes below 100 percent of the area median income. If applicable, proposals should also explain how the funds will be used to identify and remove barriers to affordable housing in a manner that affirmatively furthers fair housing by expanding access to housing opportunities in well-resourced areas for protected class groups. HUD will also prioritize applicants that demonstrate a commitment and ability to identify and remove barriers to: (1) expanding affordable housing in a manner that promotes desegregation; (2) expanding affordable housing in well-resourced areas of opportunity for protected class groups that have systematically been denied equitable access to such areas; or (3) deconcentrating affordable housing and increasing housing choice. HUD encourages applications that incorporate a discussion of key barriers related to land-use regulations, permitting, or related procedural issues. HUD further encourages applicants to outline and discuss how their proposed activities will advance equity, locate affordable accessible housing near transit and bolster access to services and opportunities, increase community resilience and mitigate the effects of natural and environmental hazards, and develop and preserve affordable housing in accordance with input from community members and other stakeholders.As with all CDBG assistance, the priority is to serve low- and moderate-income people.PRO Housing grantees must administer the PRO Housing grant in a manner that affirmatively furthers fair housing, which means taking meaningful actions, in addition to combating discrimination, to overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics. Specifically, affirmatively furthering fair housing means taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunities, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws.