A recent presidential order has left Reading administrators and City Council members concerned about millions in unspent federal funding intended to support affordable housing and reduce homelessness in Reading.
The city received $3.5 million in 2021 through the Home Investment Partnerships Program — American Rescue Plan Program, or HOME-ARP, which is funded through the U.S. Department of Housing and Urban Development.
The program aims at reducing homelessness and increasing housing stability through rental housing development, tenant-based assistance and support services.
It was designed under the “housing first” model, which prioritizes permanent housing without requiring participants to first engage in treatment or job programs, Community Development Director David Barr explained.
However, a recent presidential executive order may shift federal priorities away from that model, he cautioned, creating uncertainty about how the funds may be used in the future.
Barr and Deputy Director Patricia Vasquez briefed City Council on the status of funds during a recent council committee of the whole meeting.
The city set aside a portion of the funding for workforce development and services and designated the remainder, about $2.9 million, for affordable housing, through an action plan approved by council in 2022.
Under HUD guidelines, Vasquez said, the housing units must serve working families, not specifically homeless individuals. Some of these working families could be experiencing homelessness and still struggling to afford rent.
“They’re back on track,” Vasquez said. “They’re back on their feet, but they simply cannot afford rent.”
Opportunity House, which operates a homeless shelter on North Second Street, was the only organization to respond to the city’s request for proposals.
The nonprofit pursued four potential properties, Barr noted, most recently a 20-unit apartment building at 100 S. Fourth St.
That plan was rejected by council in March on a 4-3 vote, with Baez and Councilman Rafael Nunez and Councilwoman Vanessa Campos voting yes.
City Council turns down funding for Opportunity House affordable housing
While the money is available until 2030, Barr said, HUD could choose to reclaim unspent funds.
Councilman Jaime Baez Jr. and other council members noted their concern.
“I worry about our federal government and the funds being taken away, or that they may be in jeopardy,” Baez said.
Baez said he believes Opportunity House could complete an affordable housing project and administer the funds in accordance with HUD guidelines. However, he asked if council should consider whether other organizations might deliver a project more quickly.
Vasquez confirmed the city could rebid the funds if desired, though so far, no other agencies have expressed interest.
Some requirements attached to HOME-ARP, including a 15- to 20-year affordability commitment, can make the program unattractive to potential applicants, she noted.
“We did not have other agencies interested in moving forward with the project,” she said.
Discussion also touched on whether the project should be broken into smaller sites instead of one large development.
Barr and Vasquez said such an approach could present staffing and management challenges for Opportunity House, which would need additional capacity to run multiple locations.
Barr said he and other city administrators plan to meet with Opportunity House’s leadership team this month.
Prepping for winter
Beyond the housing initiative, Barr provided an update on preparations for this winter’s Code Blue season.
In past years, the city has relied on a temporary shelter in a former convent, 1500 Eckert Ave., managed by Opportunity House.
Opportunity House to reopen temporary shelter in former convent in Reading
With shelter beds limited and demand expected to grow, officials are evaluating options that include reopening facilities and expanding existing partnerships.
Council members also raised questions about regional cooperation, stressing that surrounding municipalities share responsibility for addressing homelessness.
“I just feel morally there should be a shared responsibility,” Council President Donna Reed said, noting the problem extends to areas throughout the county, but most resources for those experiencing homelessness are found in the city.
Barr and Managing Director Jack Gombach said they are watching how other cities, including Harrisburg and Lancaster, are experimenting with models such as sanctioned encampments or public-private partnerships.
Other ideas floated by council members included tiny houses, safe parking lots for people living in cars and using repurposed railroad cars as temporary housing.
