The Oklahoma Housing Finance Agency board has slammed the brakes on a key low-income housing program while lawmakers brawl over a bill that could change how the money is handed out.
In a special meeting Monday, trustees voted to suspend awards from the agency’s HOME-funded program for the 2025 and 2026 cycles while they wait to see what happens to House Bill 1823. The pause covers both new applications and reviews of existing proposals that have not yet reached a written agreement, a move that could slow dozens of developments across Oklahoma.
Board Chair Michael Buhl introduced a resolution directing staff to stop taking new HOME applications and to halt review of previously submitted ones without executed agreements until lawmakers finish with HB 1823, according to the Oklahoma Housing Finance Agency. The agenda also warns that the pause could include “the future possibility of termination” of the agency’s administration of the 2025 and 2026 HOME programs. Trustees moved the item toward the top of the meeting so staff could spell out the risks from the pending bill.
At the meeting, OHFA housing development director Darrell Beavers told trustees the bill is “wholly misaligned with federal requirements” and could create “unmanageable liabilities.” He laid out the numbers: more than $52 million in HOME funds over the past five years to produce 243 units, an average of about $214,325 per unit, and in the most recent year 27 units funded with nearly $8.5 million, averaging roughly $313,016 per unit, as reported by The Journal Record. Nonprofit representatives in the room called the board’s move “premature” and pointed out that HB 1823 still has several hurdles left. Board Vice Chair Scott McLaws pushed for using HOME dollars to stretch across more developments statewide instead of locking in a flat developer fee.
What the bill would change
House Bill 1823, authored by Rep. Carl Newton with Sen. Darcy Jech as Senate sponsor, would require OHFA to run the HOME Investment Partnerships Program without adding any conditions stricter than federal law and would guarantee eligible entities at least a 15 percent developer fee, according to FastDemocracy. The measure cleared the House on March 12 and carries an emergency clause that supporters say would make it effective immediately if it is signed into law, FastDemocracy’s tracking shows. Backers argue the guaranteed fee protects developer overhead; opponents counter that it pulls money away from actual construction.
Why OHFA says it’s risky
Agency staff warned trustees that HB 1823 could conflict with federal HOME rules, including limits on allowable costs, matching requirements and monitoring by the U.S. Department of Housing and Urban Development. The HOME program is a HUD-funded block grant with strict compliance and reporting obligations, including per-unit subsidy caps and ongoing oversight, according to the U.S. Department of Housing and Urban Development. OHFA officials said a state-mandated developer fee could divert funds away from bricks and mortar and increase the chances of audit findings or repayment demands.
What developers and communities could lose
OHFA had just approved a round of HOME awards in January and was getting ready to open a new application window in April. The suspension could delay closings, construction starts and down payment assistance for low-income buyers and renters. In a January 28 announcement, the Oklahoma Housing Finance Agency detailed recent awards and the timing for upcoming applications, stressing that nonprofit organizations, public housing authorities and community housing development organizations depend on HOME dollars to plug financing gaps. Developers say that smaller projects with tight budgets are especially exposed when funding rules shift or money gets put on hold.
What happens next
HB 1823 now heads through the Senate process for committee assignment and floor debate, with a deadline for bills to pass their chamber of origin by March 26, according to The Journal Record. The bill received its first reading in the Senate on March 16 and remains under consideration while OHFA keeps HOME activity on ice, FastDemocracy shows. Board members said they will revisit the suspension if lawmakers amend the bill or if it fails to become law.
Legal implications
OHFA framed the freeze as a legal safety move to avoid putting the agency or HOME recipients in a bind where a state statute forces actions that violate federal HOME regulations or trigger HUD recapture or other enforcement. Those federal rules are laid out and enforced by the U.S. Department of Housing and Urban Development, which requires participating jurisdictions to comply with program standards and subjects them to monitoring and reporting. Agency leaders urged lawmakers and housing stakeholders to sort out the conflict before OHFA commits any additional HOME awards.
