Housing Counseling Process Evaluation and Design of ... - HUD User

associated with increases in overall counseling volumes of nearly the same amount over this period.
The next sharp rise in HUD funding in the FY 2003 appropriation can be seen in the significant jump
in counseling volumes in FY 2005, reflecting the delay from when these funds actually reach
counseling agencies.
Trends in HUD-Approved Counseling Agencies
Another factor affecting trends in the volume of counseling clients is the number of HUD-approved
agencies. As noted earlier, HUD’s earliest involvement in promoting housing counseling was to
encourage non-profit organizations to provide these services. HUD began approving counseling
agencies in 1969, and since beginning regular funding for housing counseling in 1977, has required
HUD approval as a condition for being eligible to compete for these funds. The criteria for becoming
a HUD-approved housing counseling agency include non-profit status, a local community presence,
experience administering a housing counseling program for at least a year, and an automated client
management system for collecting and reporting client-level data. 14 HUD does not specify specific
service standards for approved agencies, aside from requirements that at least half the counseling staff
have some training and six months experience in their counseling role, that the agency has counselors
who are fluent in the language of the clients they serve, and that the agency’s facilities provide for
private one-on-one sessions, are accessible by public transportation (except in rural or suburban
areas), and have operating hours that meet the needs of working clients.
HUD approval does not guarantee that an agency will be awarded HUD housing counseling funds.
Indeed, there are a much larger number of HUD-approved agencies than there are HUD-funded
agencies. There are currently about 1,800 HUD-approved counseling agencies with about 2,400 local
offices nationwide. Of these agencies, approximately 1,200 received funding from HUD either
directly or through an intermediary or SHFA. Aside from being eligible for HUD funding, agencies
may seek HUD approval to be included in HUD’s list of approved agencies that are promoted on their
web site. HUD approval may also enhance an agency’s legitimacy in the eyes of the general public
and funders. HUD also invests approximately $3 million annually to train counselors for agencies
participating in the Program.
HUD’s housing counseling funds are allocated through a competitive process directly to individual
local housing counseling agencies (LHCAs) as well as to national and regional intermediaries and
SHFAs who allocate some or all of the funds to their LHCA affiliates. Affiliates of intermediaries
and SHFAs do not have to apply for HUD approval, but the intermediaries and SHFAs are
responsible for determining that these organizations meet or exceed HUD’s criteria for being an
approved agency.
Exhibit 2-4 shows the trend in the number of HUD approved counseling agencies since 1969
(although with several gaps in the series due to data being unavailable for these years). As shown, the
number of approved agencies grew rapidly during the 1970s, reaching a peak of about 600 by the
early 1980s. A decade later the number of approved agencies remained slightly below 600, but then
the number grew fairly rapidly during the 1990s, reaching slightly more than 1,100 by 2002. Since
14
Housing Counseling Program; Final Rule, Federal Register Vol. 72, No. 188, September 27, 2007, pp.
55638-55654.
14
Chapter 2. Overview of the Housing Counseling Industry