Back to Basics: Virginia Housing Trust Fund

The FWD #B05 • 718 Words

The Virginia Housing Trust Fund is the Commonwealth’s largest self-generated resource for expanding housing opportunity.

What is the Virginia Housing Trust Fund?

The General Assembly established the Virginia Housing Trust Fund (VHTF) in 2013 to provide additional resources for increasing the supply of affordable housing and reducing homelessness in the Commonwealth. The VHTF is Virginia’s main discretionary fund to support these efforts. It works in conjunction with other affordable housing loans, subsidies, and grants to take projects from concept to reality.

Virginia is one of forty-seven states across the country to have a housing trust fund. According to the Housing Trust Fund Project, these funds collected and awarded more than $1.7 billion in 2021.

How it works

Every state budget cycle, lawmakers allocate a portion of general fund dollars to the VHTF. These funds are administered by the Department of Housing and Community Development (DHCD) in partnership with Virginia Housing.

Increasing the supply of affordable housing

By law, at least 80 percent of the VHTF must go to financing projects that create or preserve affordable homes. DHCD distributes these awards via the Affordable and Special Needs Housing (ASNH) Competitive Loan Pool, which also includes federal funds from the National Housing Trust Fund (NHTF) and the HOME Investment Partnerships Program (HOME).

Beginning in the 2020-2021 award cycle, proceeds from Regional Greenhouse Gas Initiative (RGGI) auctions are also included in ASNH via the Housing Innovations in Energy Efficiency (HIEE) fund. These investments will help reduce energy bills for homes created with VHTF dollars, saving low-income Virginians more money.

Since 2015, the Vibrant Community Initiative (VCI) has also received partial funding from the VHTF to support large-scale transformative community development projects that include affordable housing. This is a joint program between DHCD and Virginia Housing.

Affordable rental projects are prioritized for VHTF funding if they support persons with very low incomes. To date, over 90 percent of all affordable units created with VHTF dollars serve households with incomes below 60 percent of AMI.

DHCD also works with the Department of Behavioral Health and Disability Services (DBHDS) to serve vulnerable populations via permanent supportive housing (PSH) in VHTF-funded projects. These groups include our fellow Virginians with intellectual and developmental disabilities, serious mental illness, and those experiencing chronic homelessness. The most recent ASNH award cycles (spring and fall of 2021) include nearly 400 units of PSH funded by the VHTF.

In the last four years, every one dollar from the HTF resulted in an additional $30 leveraged from federal, local, and private funding. These sources include the other streams wrapped into ASNH and VCI, Low-Income Housing Tax Credits from Virginia Housing, and additional grants and loans from local governments.

Ending homelessness

The remaining VHTF funding, about 20 percent of the total allocation, goes to Homeless Reduction Grants administered by DHCD. These grants are awarded to homeless service organizations and local agencies to provide services within PSH projects, support rapid re-housing, and deliver other types of stabilization to break the cycle of homelessness.

In response to feedback from service providers and the growing supply of PSH units across the state, DHCD has significantly increased the share of VHTF funds used to cover healthcare and social services for PSH residents—from $200,000 in 2016-2017 to $900,000 in 2019-2020. These services can otherwise be difficult to pay for with other traditional federal homelessness grants, showing the benefit of VHTF’s flexibility.

Funding levels

Virginia lawmakers allocated $63 million to the VHTF between FY2014 and FY2020—about $9 million per year. In FY2021, the General Assembly made the largest investment yet at $70.7 million. The VHTF is funded at $55 million for FY2022.

As of today (February 24, 2022), lawmakers continue to deliberate Virginia’s 2022-2024 biennial budget. The proposed Senate budget would significantly increase the VHTF to $300 million for the biennium, while the House budget would maintain the current $55 million per year for the next two years.


Since its inception, the VHTF has:

  • Created or preserved more than 6,800 affordable homes,
  • Provided more than 1,700 units of permanent supportive housing,
  • Leveraged nearly $1.7 billion from other funding sources, and
  • Helped account for a 34 percent reduction in overall homelessness from 2010.

More information

Virginia Housing Trust Fund (DHCD)

VHTF fact sheets (Virginia Housing Alliance)

Interactive VHTF project dashboard (HousingForward Virginia)

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