The House and Senate, on December 12 and 13 respectively, passed a broad FY15 funding bill, H.R. 83, spanning programs in 11 of the 12 appropriations subcommittees, including the Transportation, Housing and Urban Development, and Related Agencies (THUD) and Agriculture, Rural Development, Food and Drug Administration, and Related Agencies (USDA) Subcommittee bills. The House passed the bill by a vote of 219 to 206 and the Senate on a vote of 56 to 40. President Barack Obama is expected to sign the bill early this week.
The bill does not include any restrictions for HUD to administer the National Housing Trust Fund, as proposed in the House THUD funding bill. In addition, the bill does not prohibit HUD from implementing the Affirmatively Furthering Fair Housing rule, nor does it restrict HUD from approving exceptions to voucher payment standards, both of which were also in the House bill. The bill does not provide for any expansion of the Moving to Work demonstration program. An amendment to do so was filed as the Senate prepared to debate its bill, but was never considered on the Senate floor.
The bill provides $17.486 billion for voucher renewal funding, slightly below House and Senate numbers, and well below the President’s request. Given that many of the vouchers lost and then restored after the sequester are not leased up yet, it is likely that the bill will provide sufficient renewal funding in FY2015 for all vouchers in use in 2014. As a backstop, the bill would allow public housing agencies (PHAs) to access a $120 million pool of funds beyond what they are provided, which can explicitly be used by “PHAs that experience significant end of year leasing in calendar year 2014.”
The bill provides $130 million for tenant protection vouchers to protect tenants from displacement due to public housing demolition or disposition, a private owner of a project-based Section 8 contract opting out of the contract, or termination of a Section 8 contract. A set-aside of $5 million is included to protect tenants at certain properties with maturing HUD-assisted or HUD-held mortgages.
As it has for several years, the bill includes $75 million for HUD-Veterans Affairs Supportive Housing (HUD-VASH) vouchers, with a new set-aside for Native American veterans. The bill also provides $83 million for Section 811 mainstream vouchers for persons with disabilities, a cut from FY14’s $107 million.
The bill keeps the Capital Fund at the FY14 level of $1.975 billion, including level funding for the Resident Opportunity and Self-Sufficiency program and for the Jobs-Plus pilot program. The bill increases, from 20% to 25%, the amount of Capital Fund dollars that PHAs can transfer to their Operating Funds, and allows the Secretary to waive this limitation if used for security, anticrime, and antidrug activities. As in FY14, the bill prohibits use of funds to require or enforce HUD’s Physical Needs Assessment of a PHA’s public housing stock. For the Operating Fund, the bill provides a $40 million increase to $4.440 billion. The bill also allows the HUD Secretary to adjust flat rents. The FY14 HUD funding bill required public housing residents who opted to pay a flat rent to pay at least 80% of the fair market rent.
HUD’s Choice Neighborhoods Initiative (CNI) is funded at $80 million, down from $90 million in FY14. Of the total, at least $50 million (down from $55 million in FY14) must go to PHA applicants. CNI is open to private developers as well as PHAs.
For the Rental Assistance Demonstration (RAD) program, the bill increases the cap on the number of public housing units that can convert assistance to project-based Section 8 or project-based vouchers from 60,000 to 185,000, and extends the conversion deadline from September 2015 to September 2018. The bill permanently extends the second RAD component, which allows subsidy conversion for the Rent Supplement, Moderate Rehab, and Rental Assistance Payment programs. The bill would allow McKinney-Vento Single Room Occupancy developments to be eligible for RAD.
Project-Based Rental Assistance
The bill gives implicit approval to HUD’s request to shift the project-based rental assistance (PBRA) program to a calendar-year funding cycle. For PBRA renewals, the bill provides $9.730 billion, compared to $9.970 billion in FY14 and $9.746 billion requested by HUD and in the House and Senate versions of earlier FY15 HUD funding bills. This will require a large increase of at least $1.2 billion for FY16.
The bill continues various policies regarding preservation of the assisted housing stock, including provisions allowing transfer of debt and restricted use agreements from obsolete to viable projects, guidelines regarding HUD’s management or disposition of at-risk properties to ensure continued assistance to tenants, and actions HUD must take when a property’s real estate assessment center (REAC) scores fall below certain levels.
The bill also allows PBRA tenants to participate in the Family Self-Sufficiency (FSS) program, but provides no FSS funds for the PBRA program. There is also a new pilot to test the effectiveness of pairing FSS with Family Unification Program (FUP) vouchers.
Homeless Assistance Grants
The bill provides $2.135 billion for Homeless Assistance Grants, $271 million less than HUD requested but a $30 million increase over FY14. Of the total, at least $250 million is dedicated to Emergency Solutions Grants, and at least $1.62 billion is dedicated for the Continuum of Care and Rural Housing Stability Assistance programs. For the United States Interagency Council on Homelessness, the bill provides $3.530 million, a $30 million increase.
Funding for HOME decreases by $100 million to $900 million, less than half of the HOME funding level five years ago. The bill also provides $10 million for the Self Help Opportunity Program, which is not a set-aside within the HOME program as HUD had requested.
Section 811 and 202
The Section 811 Housing for Persons with Disabilities program sees a $9 million increase to $135 million, but all of the funds will go to renewals. The Section 202 Supportive Housing for the Elderly program receives a $36 million increase to $420 million, including set-aside funding for service coordinators of $70 million.
CDBG is funded at $3 billion, a $30 million cut from FY14. The bill prohibits providing CDBG money to a for-profit entity for an economic development project unless the project has been evaluated and selected in accordance with certain HUD guidelines.
The Fair Housing Initiatives Program (FHIP) and Fair Housing Assistance Program (FHAP) are flat-funded at $23 million and $40 million respectively. The bill’s report directs HUD to work with the United States Access Board, interested disability advocates, and other stakeholders to consider mechanisms to increase the availability of accessible housing.
Policy Development and Research
For HUD’s Office of Policy Development and Research, the bill places $22 million of HUD technical assistance programs into the PD&R account. The bill also includes $12.3 million for research, including new HUD research on VASH for Native Americans and the FSS/FUP demonstration. Finally, the bill provides $37 million for various housing market surveys, totaling $72 million for PD&R in FY15.
Other HUD Programs
Native American Housing Block Grants are flat-funded at $650 million, as is the Housing Opportunities for Persons with AIDS program at $330 million. The bill provides $110 million, level funding, for the Office of Lead Hazard Control and Healthy Homes.
USDA had requested authority to impose minimum rents on tenants, but Congress did not adopt this proposal in the FY15 bill. Funding remained flat for Section 514 / 516 Farm Labor loans and grants and for Section 515 rental housing. The Section 521 program is reduced from $1.110 billion to $1.089 billion, and funding for the rental preservation demonstration decreases by $3 million to $17 million.
The NLIHC budget chart is at http://nlihc.org/sites/default/files/FY15_HUD_and_USDA_Budget_Chart_12.11.14.pdf