Summary: In 1998, Congress passed the Veterans Programs Enhancement Act, which authorized the Department of Veterans Affairs (VA) to establish a new loan guarantee program for the construction or rehabilitation of multifamily transitional housing projects specifically designed to provide housing for homeless veterans. The program is intended to increase the amount of housing available, as well as provide other services to encourage addiction recovery and reestablish work and social relationships. GAO was asked to examine why no multifamily housing projects are operational, given that the VA's loan guarantee program was authorized 6 years ago. Specifically, GAO was asked to provide information on (1) actions VA has taken to implement the Transitional Housing Loan Guarantee Program and (2) issues that have affected program implementation.
GAO found that since enactment of the legislation authorizing the loan program in 1998, VA has drafted regulations; designed the program, including working with program contractors to develop the loan terms and supporting infrastructure for processing and administering the loans; and consulted with OMB and sponsors (potential loan recipients) to conceive the initial housing projects. Program implementation has been affected by the challenges associated with creating VA's first transitional housing loan guarantee program for homeless veterans, deciding on program financing and structure including whether VA or the Department of Housing and Urban Development should manage the program, replacing the initial program development contractor, and addressing delays associated with project-specific, local issues such as historical preservation and obtaining land parcels.
