What HOME-ARP does
HOME-ARP is a one-time $5 billion appropriation enacted under the American Rescue Plan Act of 2021 to expand HUD's HOME Investment Partnerships Program for the specific purpose of serving five "qualifying populations" experiencing or at risk of homelessness. The funds are administered by HUD through the existing HOME Program participating jurisdictions, but the eligible uses, qualifying populations, and compliance framework are distinct from regular HOME.
HUD allocated HOME-ARP funds directly to states, local governments, and insular areas in 2021. Funds must be committed by participating jurisdictions through HOME-ARP allocation plans approved by HUD and must be expended by September 30, 2030 — the statutory expenditure deadline. Practitioners should treat HOME-ARP as a closing window: the funding is one-time and the pipeline of HOME-ARP supported deals is finite.
The five qualifying populations
HOME-ARP funds can only serve households in one of five statutorily defined qualifying populations (per ARP § 3205):
- QP1 — Homeless, as defined in 24 CFR § 91.5 — sleeping in a place not meant for human habitation, in an emergency shelter, or in transitional housing.
- QP2 — At risk of homelessness, as defined in 24 CFR § 91.5 — income below 30% AMI, lack of resources or support networks, and one of seven specified risk conditions.
- QP3 — Fleeing or attempting to flee domestic violence, dating violence, sexual assault, stalking, or human trafficking. ARP § 3205 leaves this population to be defined "by the Secretary"; HUD's HOME-ARP Notice CPD-21-10 implements it using the domestic-violence definitions at 24 CFR § 5.2003 and the human-trafficking definition at 22 U.S.C. § 7102.
- QP4 — Other populations where providing housing assistance or services would prevent homelessness or serve those at greatest risk of housing instability.
- QP5 — Veterans and families that include a veteran family member that meet one of the preceding four criteria (QP1–QP4).
Eligible activities
HUD's HOME-ARP Notice CPD-21-10 establishes four categories of eligible activities:
- Production or preservation of affordable rental housing. Acquisition, new construction, rehabilitation, or reconstruction of multifamily rental projects, with all HOME-ARP-assisted units reserved for qualifying populations. Units must remain affordable for at least 15 years.
- Tenant-based rental assistance (TBRA). Rental subsidies to households in qualifying populations, with HOME-ARP TBRA contracts of up to 24 months and option to extend.
- Supportive services. A wide range of supportive services including housing counseling, case management, mental health and substance use services, employment assistance, and child care.
- Acquisition or development of non-congregate shelter (NCS). Acquisition or development of non-congregate emergency shelter facilities — a category that did not exist in regular HOME.
Labor standards — Davis-Bacon
HOME-ARP rental housing construction triggers federal Davis-Bacon prevailing-wage requirements when a project has 12 or more HOME-ARP-assisted units — the same threshold as regular HOME under 24 CFR § 92.354(a) applied to HOME-ARP. Projects below the 12-unit threshold are exempt from federal Davis-Bacon, though state and local prevailing-wage laws apply independently. TBRA, supportive services, and non-congregate shelter operations do not themselves trigger Davis-Bacon, though related construction (e.g., NCS facility build-out) does.
LIHTC pairing
HOME-ARP can be layered with 4% or 9% LIHTC. Two structural rules to flag: (1) HOME-ARP grant funds reduce LIHTC eligible basis under IRC § 42(d)(5)(A), so converting HOME-ARP to a loan with bona fide repayment obligations generally avoids the basis-reduction haircut; (2) the 15-year HOME-ARP affordability period runs concurrently with LIHTC's 15-year compliance period, but LIHTC's 30-year extended-use period extends beyond HOME-ARP's requirement — the longer restriction governs.
For full capital-stack mechanics — HOME-ARP-as-loan structuring, income-averaging interactions with QP-served units, and triple-stacking with HTF for the deepest affordability — see the dedicated guide: LIHTC Deal Structures Guide.
Post-OBBBA implications
OBBBA did not amend HOME-ARP. The September 30, 2030 expenditure deadline remains in statute. Practitioners with HOME-ARP-supported deals in early-stage development should focus on commitment and construction-start timelines to ensure expenditure before the deadline.
Sources
- American Rescue Plan Act of 2021, P.L. 117-2, § 3205
- HOME-ARP Notice CPD-21-10, September 13, 2021 (HUD)
- 24 CFR Part 92 (HOME regulations as modified for HOME-ARP)
- 24 CFR § 91.5 (definitions of homeless and at-risk of homelessness)
- HUD HOME-ARP allocation plan submission requirements
- IRC § 42(d)(5)(A), federal subsidy basis-reduction rule
- P.L. 119-21, One Big Beautiful Bill Act, enacted July 4, 2025
Disclaimer
HOME-ARP is administered by HUD-designated participating jurisdictions (states, local governments, insular areas) under each PJ's HOME-ARP allocation plan. Eligible activities, income limits, and rent restrictions vary by PJ. Practitioners should consult the relevant PJ's HOME-ARP allocation plan and HUD Notice CPD-21-10 before structuring a deal. This is educational content and is not legal, tax, or financial advice.