Housing Trust Funds Q&A

It is the private sector in Florida that is in the business of providing affordable housing.

In 1991, The Florida Home

Builders Association (FHBA) and the Florida Realtors intent on creating jobs in the housing

construction industry and getting more low and moderate income families into homeownership, respectively, asked the

Florida Legislature to increase the transfer fee

on all real property transactions (a fee/tax on their industry) and dedicate

that increment to the state and local housing trust funds. These trust funds are referred to as the Sadowski state and local

housing trust funds.Several statutory parameters were “must haves” for these industry groups.

These include:

1) That the monies be dedicated solely for affordable housing;

2) That most of the funds (75%) are used for construction related activities (that does not mean

new construction-rehabilitation or refurbishing

substandard properties meets the construction related requirement); and,

3) That most of the local housing trust funds (65%) are used for homeownership related activities (this also is

not restricted to new homeownership – rehabilitation or refurbishing substandard homes meets the homeownership requirement).

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The SHIP program, used for down payment and closing cost ass

istance to help families into first time homeownership, has been a staple of almost every local jurisdiction. The families put into first time homeownership with SHIP funds received homebuyer counseling and a 30 year fixed rate mortgage. Many homeowners also receive post – purchase counseling. The foreclosure crisis in Florida has only affected families with SHIP loans if they lost employment; no SHIP home would have been lost due to the terms of the mortgage. Typically, families who were fortunate enough to receive SHIP assistance ended up paying less of their monthly income on housing than they had paid as a renter.

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The Florida Housing Finance Corporation is charged with overseeing the implementation of the trust funds. Every local government receiving trust fund monies (all 67 counties and entitlement cities) must provide an annual report to the state that accounts for all housing trust fund monies. This report ensures that all funds are used in accordance with statutory guidelines. Having a state agency in charge of oversight was also a priority for the private sector industry groups.

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including putting unemployed subcontractors back to work; and $3.433 billion in positive economic impact.

Jobs, economic benefit, and accountability.

For more information on the Sadowski Housing Coalition, please visit

www.SadowskiCoalition.com