HUD News

Washington- The Department of Housing and Urban Development (HUD) office of Multifamily Housing announced the completion of a rental assistance demonstration transaction with the Housing Authority of the City of Cumberland (HACC). HACC will look after the financing that’ll go into the preservation and rehabilitation of 100 affordable rental homes at John F. Kennedy apartments in Downtown Cumberland, Maryland.

Acting Secretary Adrianne Todman said, “At HUD, we’re working to ensure that homes are not just affordable, but truly quality places to live for decades to come. Today, I’m happy to announce that 100 affordable rental homes in Maryland will now be preserved and rehabilitated for the families we serve.”

John F. Kennedy Apartments was built in 1967 and is an 11-story structure within the distance of neighborhood amenities. Because it is too old, the building needs extensive capital improvements to make room for affordable homes and support its senior residents as they age in place. HACC will convert dozens of efficiencies to one bedroom and double the number of homes meeting the federal accessibility standards through rental assistance demonstration. This will make the homes accessible for persons with disabilities.

Deputy Assistant Secretary for Multifamily Housing Programs Ethan Handelman said, “These affordable homes will also include updated kitchens, bathrooms, windows, doors, plumbing and HVAC systems, and enhanced onsite amenities; all necessary improvements that will help increase energy efficiency, and reduce environmental impact and utility costs.”

The construction will be completed in three phases and the residents will be allowed to remain housed at the development during the renovation process. It is estimated that the total construction cost of the project will be $17.7 Million or $170,00 per home. The finance for the construction of this would be through a combination of 9 percent low-income housing tax credits, a risk share loan by the Federal Housing Authority (FHA), and funds from Maryland’s Department of Housing and Community Development.

About Rental Assistance Demonstration (RAD)

The rental assistance demonstration program was designed to address the multi-billion dollar backlog of deferred maintenance in the public housing portfolio and stem the loss of affordable housing that was not according to decent standards. The rental assistance demonstration program has facilitated more than $19.3 Billion in capital investment to improve or replace around 205,000 deeply rented assisted homes from the program’s inception to March 1, 2024. These improved rent-assisted homes will be used to house low-income families, seniors, and persons with disabilities.

Under the rental assistance demonstration program, the projects receiving the funds through the public housing program convert their public housing assistance to project-based section 8 rental assistance. The residents will continue to pay 30% of their income towards rent under section 8. Also, it is necessary that the housing must serve the ones having low incomes as was the case when the property was assisted through the public housing program. Before conversion, the residents must be notified and consulted and given a right to return to assisted housing after construction. This will ensure that the same tenants get to enjoy the newly preserved and improved apartments along with maintaining the same fundamental rights they once had as public housing residents.