New HUD Budget Could Defund Rental Assistance, Other Programs

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Although it has been declared by many in Congress as “dead
on arrival” the Trump Administration’s proposed 2019 budget appears more predicated
on another cliché – “If at first you don’t succeed…” The budget again goes
after many of the cuts in Housing and Urban Development (HUD) programs it
attempted in the FY2018 version.

The budget calls for an overall 18.3 percent cut in
HUD funding.
 The $39.2 billion in gross
discretionary funding for the Department is $8.8 billion less than the 2017
enacted level.

The
Community Development Block Grant program and the HOME Investment Partnership
Program are not funded under the proposal, a suggestion Congress has previously
ignored. The proposal also seeks to end the
Choice Neighborhoods program as well as the National Housing Trust Fund.

According to the budget’s narrative, there is a
request for $33.8 billion for HUD’s rental assistance programs and continues to
support programs to reduce homelessness and remove lead and other hazards from
over 9,500 homes.  It also states an
intention to request “legislative reforms to place these (rental assistance)
programs on a more fiscally sound path while encouraging work and
self-sufficiency for tenants.  The rental
program budget request is a decrease of 11.2 percent
from the 2017 enacted
level.

The budget proposes specific savings in the Housing
Voucher and Public Housing programs
and eliminates the previous $2 billion in
funding for the Public Housing Capital Fund, stating that the provision of
affordable housing should be a responsibility more fully shared with State and
local governments.  The intent, the
narrative says, is to support currently assisted households while decreasing
the federal footprint of HUD’s assistance over time.

Other specific budget requests include:


  • $2.4 billion for the Homeless Assistance
    Grants (HAG) program, equal to the 2017 enacted level. HAG primarily funds the Continuum of Care
    program, which is designed to be a coordinated community-based network of
    programs to prevent and address local homelessness.

  • $255 million for Emergency Solutions
    Grants, which would enable municipalities to support emergency shelter, rapid
    re-housing, and homelessness prevention.

  • $145 million, equal to the 2017 enacted
    level, for the mitigation of lead-based paint and other hazards in low-income
    homes, especially those in which children reside. This funding level also includes resources
    for enforcement, education, and research activities to further support this
    goal.

  • Preserves access to sustainable
    homeownership opportunities for creditworthy borrowers through FHA and Ginnie
    Mae credit guarantees.
    The Budget
    requests an additional $20 million above the 2017 enacted level of $130 million
    for FHA to upgrade its operations by investing in information technology and
    contract support. This additional
    funding is fully offset by a modest new fee on FHA lenders, better aligning the
    responsibilities for the costs and benefits of this program.

  • Eliminates Major Block Grants (of
    unspecified nature,) and “continues to propose eliminating funding for programs
    that lack measurable outcomes and are ineffective.”

Donna Kimura quotes several housing
advocates who are highly critical of the program in an article in Affordable Housing Finance.  Among the comments:

David M. Dworkin, president and CEO
of the National Housing Conference:
“This
budget is bad policy and bad politics. It undermines years of public-private
investments in housing and community development that have had broad bipartisan
support, like the CDFI Fund and block grant funding for neighborhood
redevelopment. It even cuts the Capital Magnet Fund and National Housing Trust
Fund, which aren’t even paid for by taxpayers.”

Jonathan Reckford, CEO of Habitat
for Humanity International
, “We urge
Congress to rise to this moment by rejecting these cuts and investing now
before another generation of struggling families are forced to pick between
housing and food.”

National Low Income Housing
Coalition: “The request provides about $19.3 billion for tenant-based rental
assistance. “This includes $17.514 billion to renew previous contracts, or more
than $3 billion less than what is needed to ensure that all contracts are fully
renewed.” The Coalition  estimates more
than 330,000 vouchers would be lost.



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