On June 9, Senators Barbara Mikulski (D-MD) and Ben Cardin (D-MD) introduced S. 1530, a bill that would renew the Moving to Work (MTW) agreements for 11 of the 39 MTW public housing agencies (PHAs) for 10 years, and prohibit HUD from making any significant change to the financial terms of the covered agreement.
The bill would apply to the 11 MTW PHAs that have agreements giving them a preferential, alternative public housing operating fund formula. These 11 MTW PHAs have operating fund formulas that provide them with increased funding at the expense of all non-MTW PHAs as well as MTW PHAs without the preferential operating fund treatment. The Housing Authority of Baltimore City is one of the 11 PHAs.
HUD currently has agreements with 39 PHAs that allow them to operate under the MTW demonstration through 2018. HUD and the 39 PHAs began negotiating extension of their MTW agreements in 2014.
According to analysis by the Center on Budget and Policy Priorities, “In 2013, agencies funded through alternative formulas were eligible for $7,900 per public housing unit – 91% more than the average for non-MTW agencies and the 28 MTW agencies without special formulas.” It is estimated that in 2014, had the extra funds afforded the 11 PHAs been available to all PHAs, the rest of the PHAs would have received an additional 5% in operating funds. The House FY16 HUD funding bill, H.R. 2577, would fund all PHAs, except the 11 with preferential treatment, with just 83% of what the regular operating fund formula determines their funding needs to be.
HUD wants to end the alternative operating fund formula in order to more fairly distribute operating funds among all PHAs. NLIHC supports ending the preferential treatment of these 11 PHAs when their MTW contracts are extended.
In March, Senator Mikulski told the Senate Committee on Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies that she is very concerned that HUD’s MTW contract extension negotiations will do away with the operating subsidy agreement in the existing contracts, which she said will result in HABC losing $42 million annually (see Memo, 3/16).
S. 1590 was referred to the Senate Committee on Banking, Housing, and Urban Affairs.
The Center on Budget and Policy Priorities paper is at http://www.cbpp.org/research/hud-seeks-significant-improvements-to-moving-to-work-demonstration-but-additional-changes