The Sadowski Affordable Housing Trust Fund helps the apartment industry by providing money to build and repair affordable apartment homes for Florida’s most vulnerable populations.
More than 780,000 Florida households spend at least 40 percent of their income on rent. Access to affordable housing is critical for the future of Florida’s growing economy.
The Sadowski Act (1992) created a dedicated revenue source to fund Florida’s affordable housing programs. The housing trust fund, which is also known as the Sadowski fund, is financed by document stamp taxes that are paid on all real estate transactions that take place in the state.
The preservation of the Sadowski fund is important for the Florida apartment industry because the demand for apartment homes continues to rise. Sadowski funds help mitigate the high demand for new affordable apartment homes across the state by aiding in the construction or refurbishment of affordable units.
How This Impacts the Apartment Industry:
Sadowski funds are reinvested into the community to help Florida’s most vulnerable populations, which include veterans, the elderly, people experiencing homelessness, and persons with special needs. In general, 30 percent of the funding is used for initiatives such as the State Apartment Incentive Loan (SAIL) program and 70 percent of the trust fund resources are used for single-family housing initiatives (SHIP). In the apartment industry, SAIL funds are used to rehabilitate existing apartments or build new units where additional affordable housing is needed. During the COVID-19 pandemic, SHIP funds were used to support local rent relief programs before federal relief was provided, which helped residents in need maintain quality rental housing.
As Florida’s economy and the job market continue to recover from the pandemic in the months ahead, it is critical for local rental assistance programs to continue to be adequately funded. In December 2020, Congress appropriated roughly $1.4 billion in additional federal funding for rental assistance programs in Florida. However, this new funding is restricted based on certain factors, including area median income (AMI), and as a result, some Flordians who are in need will not qualify for federal assistance. In light of the federal funding restrictions and the tremendous ongoing need for rental assistance, the Legislature should use all of the Housing Trust Fund monies for Florida’s housing programs, including rent relief.
The Florida Apartment Association urges the Legislature to use all of the Housing Trust Fund monies exclusively for Florida’s housing programs and to provide resources for local rent relief programs. In addition, FAA encourages the Legislature to pass SB 510 (Sen. Ed Hooper)/HB 13 (Rep. Sam Killebrew), which will prevent the Legislature from diverting any cash balances in the Housing Trust Fund for other purposes within the state budget.
Where do these bills stand?
The Legislature has not yet proposed a budget or an allocation for the Sadowski Affordable Housing Trust Fund. The Legislature will begin the appropriations process after the governor submits his budget proposal in February. Similarly, both bills have not had a hearing at this time. Please stay tuned for future updates, as it is still very early in the legislative process.
What is the status of the rent relief recently allocated by the U.S. Congress?
On January 12, Governor Ron DeSantis announced
that Florida submitted confirmation to the U.S. Department of the Treasury to take part in the Emergency Rental Assistance Program established under the federal COVID-19 relief legislation that was signed into law by the president on December 27. In this announcement, the governor indicated that the disbursement of funds from the federal government will occur in the coming weeks and additional information will be released by the State of Florida once further guidance is provided by the federal government.