Texas Department of Housing & Community Affairs - Building Homes and Strengthening Communities

Community Housing Development Organizations (CHDOs)

CHDO Certification Description

C-H-D-O, Community Housing Development Organization, is pronounced "cho-do." Under HOME, 15 percent of the HOME funds allocated to every PJ (a participating jurisdiction - city, County, multi-jurisdictional consortium, or state) are set aside for projects developed by CHDOs. The 15 percent CHDO set aside is Congress's explicit effort to direct HOME program funds into the hands of nonprofit developers.

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What is a CHDO?

As a private nonprofit organization with a 501 (c) federal tax exemption, the CHDO must include providing decent, affordable housing to low-income households as one of its purpose in its charter, articles of incorporation, or by-laws. It must serve a specific, delineated geographic area; either a neighborhood, several neighborhoods, or the entire community, but not the entire state.

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Are there requirements for community participation in CHDOs?

The CHDO must have a formal process for involving potential and actual low-income HOME program beneficiaries in the design, siting, and development of CHDO programs and projects. The more complex standards involve low-income accountability: no less than one-third of the CHDO's governing board must be residents of low-income neighborhoods (defined as at least 51 percent of households with incomes below 80 percent or median), low-income residents of the CHDO's target area, or elected representatives of low-income neighborhood organizations. The required board structure may necessitate restructuring or the creation of eligible subsidiaries plus, for CHDO projects, the establishment of project-specific advisory committees.

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CHDO FAQs

To find more information about CHDO, please read the CHDO Frequently Asked Questions (FAQ) or visit HUD's HOME Front section 'How to Become a CHDO' for detailed information on forming and running a CHDO. Community-based nonprofits seeking free legal advice from experienced attorneys should visit www.texascbar.org.

For more information, please contact Abigal Versyp at abigal.versyp@tdhca.state.tx.us.