The Rental Assistance Demonstration (RAD) program is an initiative created by the United States Department of Housing and Urban Development (HUD) that allows public housing authorities, or PHAs, to leverage public and private debt and equity in order to redevelop their aging public housing stock. The RAD program became an imperative move for HUD as they were losing on average 10,000 low-income housing units annually to demolition and disposition due to poor conditions all throughout the U.S. This need translated into a $26 Billion backlog of capital needs to fix the housing units. Authorized by U.S. Congress under the FY12 HUD Appropriations Act, RAD allows PHAs and owners of other HUD-assisted properties to convert low-income housing units from their original sources of HUD financing to long-term, project-based rental assistance, or PBRA, Section 8 contracts – a more sustainable source of funding. This conversion guarantees funding subsidies, unaffected by year-to-year appropriation adjustments, for the next 15 to 20 years. HUD introduced the RAD program in 2013 with an initial capacity of 60,000 units. After realizing that this need-turned-trend became a more suitable model for PHAs, the Appropriations Act of 2015 by HUD expanded the program’s cap to 185,000 units.
An initiative of the United States Department of Housing and Urban Development (HUD), the Rental Assistance Demonstration (RAD) program allows public housing authorities to leverage public and private debt and equity to redevelop their aging public housing stock and prevent the loss of existing affordable housing.
From the onset of the RAD program in 2013, the Housing Authority of the City of El Paso, TX (HACEP) realized the opportunity this program presented to preserve its affordable housing portfolio for El Paso. With an affordable housing portfolio of 6,102 units, HACEP ranks as the 14th largest PHA in the country, and fourth largest in Texas, providing clean, safe, and affordable housing for over six-percent of the city’s population – or over 40,000 residents. HACEP took on a bold commitment to preserve these homes for El Paso’s families by throwing its entire portfolio into the mix translating into a $1.3 Billion investment for the community of El Paso at zero cost to the local taxpayer. HACEP immediately became known as the first, largest RAD-converting PHA in the country and continues to be a trend-setter in its strategic plan to tackle each phase of the RAD program.
Strategic planning meetings were conducted with key stakeholders such as those using the programs, utilities, school districts, city departments that manage construction permitting processes and public transportation and the El Paso Apartment Association. Community meetings with the general public were held to gather input on their perceptions of affordable housing in El Paso. As a result, the Housing Authority of the City of El Paso (HACEP) was able to develop a strategic plan and a list of policies in conjunction with HUD and the Texas Department of Housing and Community Affairs to go forward with a portfolio-wide RAD conversion.
As of today, HACEP’s RAD initiative has completed 1,508 family relocations, celebrated 1,278 “Welcome Homes” for families coming back to revitalized communities, created over 1,050 jobs, completed over 250 community meetings, managed over 2,000 one-on-one family meetings, and has invested $740 million, on its way to $1.3 billion, at zero cost to the local tax payer. HACEP currently has 739 homes under construction, with nearly 3,000 more homes to go, translating into another 6,000 families in improved living conditions.
As the RAD initiative moves toward complete fruition, the City of El Paso continues to partner with HACEP as well as private sector developers and community nonprofits to prioritize healthy, affordable, high quality housing options for all El Pasoans. By proactively developing a plan for all El Pasoans to access quality-housing options, the City achieves multiple benefits from addressing immediate safety and stability needs to supporting robust economic development and revitalization as well as creating walkable green neighborhoods that over the long-term generate expanded opportunity for all.
Timeline of Project: Since 2013
Initiator: Housing Authority of the City of El Paso, TX
El Paso, TX – 2018 AAC Winner: Presentation
Public Information & Government Relations Officer
Housing Authority of the City of El Paso