During the week of March 11, Congress alternated between working on FY13 appropriations and the FY14 budget resolution, taking both positive and problematic steps forward in determining HUD and USDA Rural Housing funding.
After the House passed its FY13 full-year continuing resolution (CR), H.R. 933, on March 6, the Senate began to craft its own CR to be offered as a substitute amendment to the House bill (see Memo, 3/8). The House bill would fund HUD programs at FY12 levels in FY13.
Members of the Campaign for Housing and Community Development Funding (CHCDF), a group of 75 national advocates facilitated by NLIHC, sent a letter to House and Senate appropriators and leadership on March 8 urging them to include the Transportation, Housing and Urban Development, and Related Agencies bill that was informally negotiated by the House and Senate appropriators in the Senate amendment to H.R. 933. The CHCDF members wrote, “insisting on using FY12 spending levels in a ‘full-year continuing resolution’ is neither a reasonable nor a prudent approach…. To reduce losses of rental assistance, to better preserve public and other affordable housing, and to mitigate homelessness and other hardships that sequestration will bring, we urge the Senate to include a carefully thought-out full HUD funding title in the appropriations legislation it will consider next week.”
On March 12, Senate THUD Chair Barbara Mikulski (D-MD) and Ranking Member Richard Shelby (R-AL) offered a substitute amendment to the House CR, which would replace the House bill’s language in its entirety. The Senate substitute amendment would fund nearly all HUD programs at FY12 levels but would also include a THUD title with several anomalies that would increase funding for programs above FY12 levels. An “anomaly,” in the context of a CR, is a special provision included to address a particular program need.
The Senate substitute CR would provide $132 million in additional funding for Homeless Assistance Grants, bringing FY13 funding to $2.033 billion, an amount higher than the House-passed figure of $2.005 billion and less than the Senate committee-passed amount of $2.146 billion.
The Senate’s substitute CR would also increase funding for the Public Housing Operating Fund above the FY12 level by $300 million, to $4.262 billion. This increase still leaves a significant hole in the operating account. In FY12 HUD relied on public housing agencies to contribute approximately $750 million in reserve funding to supplement an intentionally low appropriation. For FY13, HUD requested that funds be restored to the operating fund. Even with the anomaly, the Senate draft CR would underfund the Public Housing Operating Fund by over $450 million.
The Senate amendment also includes a provision for the Tenant-Based Rental Assistance account, increasing administrative fees by $25 million. The provision would allow funds set aside for unforeseen circumstances in the voucher program to be used for public housing agencies that “would otherwise be required to terminate participating families from the program due to insufficient funds.” There is no funding provided for the increasing cost of maintaining current vouchers in FY13.
The Senate CR would also reinstate the language from previous appropriations bills that allows the rescission of the Housing Certificate Fund to be directed to the Project-Based Rental Assistance account. The rescission could produce $50 million or more for the project-based program. Even with this contribution, the program could face an FY13 shortfall in excess of $800 million. The draft CR restates that sequestration cuts would take place based upon the funding levels in the legislation.
On March 12, the Obama Administration issued a Statement of Administration Policy (SAP) in favor of the Senate Amendment to H.R. 933. In the SAP the Administration says, “The substitute amendment improves upon H.R. 933 by strengthening funding for transportation infrastructure, manufacturing, research and development, early childhood programs, and housing programs.”
After the Senate debated the appropriations package for four days, Majority Leader Harry Reid (D-NV) adjourned the Senate and announced that votes on floor amendments would resume on March 18. The current CR expires on March 27.
With FY13 appropriations drawing to a close, the House and Senate Committees on the Budget both marked up their FY14 budget resolutions. The House Budget Committee released its FY14 “Path to Prosperity” plan and budget resolution on March 12. The House Committee’s budget resolution would “wind down Fannie Mae and Freddie Mac,” and recommends using fair-value scoring for federal housing credit programs. Fair-value scoring, according to the Center for American Progress, is a budget technique that is not only a misnomer but also makes cost estimates less accurate by biasing apparent costs upward. Specifically, the committee cites as a reason for its proposed reforms the fact that HUD’s Federal Housing Administration (FHA) Mutual Mortgage Insurance (MMI) Fund did not meet a mandatory capital reserve ratio. Receipts from the MMI fund have been used by Congress in recent THUD appropriations bills to offset HUD appropriations.
During the committee’s markup of the House budget resolution, Representative Barbara Lee (D-CA) offered an amendment to decrease the Defense Department’s overseas contingency operations by $330 billion over ten years and reallocate these funds to programs aimed at helping homeless and veterans. The amendment failed by a party-line vote of 16 to 22.
The Senate Committee on the Budget also marked up its concurrent budget resolution, starting debate on March 13 and passing the bill along party lines on March 14. In her opening statement, Chair Patty Murray (D-WA) said, “An approach that maintains that government can’t solve every problem, that it shouldn’t solve every problem, but that it can and must work to create jobs, support the middle class, and offer a hand up to families that need some support while they work to get back on their feet.” The Senate concurrent budget resolution would reinstate the ability of Congress to fund the National Housing Trust Fund through a deficit-neutral allocation of funds from elsewhere within the resolution. A similar provision was provided in the concurrent budget resolution for FY11. The Senate resolution would replace sequestration but still cut non-defense discretionary spending by around $150 billion, far less than would the House budget resolution.
Both the House and Senate are trying to meet the statutory deadline of April 15 to pass a concurrent budget resolution. The Senate Committee on Banking, Housing and Urban Affairs also focused on FY14 spending priorities, and Committee Chair Tim Johnson (D-SD) sent a letter on the Committee’s Budget Views and Estimates to the Senate Budget Committee Chair and Ranking Member on March 1. “While we continue to see improvement in the national economy, our families… continue to struggle to overcome the effects of the economic recession…” wrote Chair Johnson. The Senator cites NLIHC’s Out of Reach, saying the nation’s Housing Wage is “far above the minimum wage or income available to persons with disabilities who rely upon Supplemental Security Income.” The Chair requested that the Budget Committee include “$1 billion in mandatory funding for the Housing Trust Fund” to address these housing needs. “The Housing Trust Fund is particularly important at this time to meet American’s sever housing needs while creating construction and real estate management jobs,” wrote Senator Johnson.
The Chair also urges that the Budget Committee “provide sufficient funding to maintain current levels of housing and community development assistance” for both HUD and USDA rural housing programs. He points out that the cost of maintaining this assistance will “exceed the amounts provided in the FY 2014 baseline.” In the letter, the Chair stresses the importance of rental assistance, public housing, homeless assistance, housing for special populations, rural housing, and HOME amongst other HUD and USDA programs.
On March 13, the Congressional Progressive Caucus (CPC) issued its budget, the “Back to Work Budget.” The CPC budget prioritizes creating jobs, equity in the tax structure, lowering defense spending, and protecting health care entitlements.
The House took Congress’s first steps in FY14 appropriations work when the House Committee on Appropriations announced its mid-April deadlines for Members to submit funding recommendations for FY14 spending for each of its 12 subcommittees. The deadline for Members to submit funding recommendations for the Agriculture, Rural Development, Food and Drug Administration, and Related agencies bill is April 10 and the deadline for the THUD bill is April 15. The President’s budget request to Congress is expected on April 8, just days before these deadlines. In years when the Administration’s budget request is sent by the statutory deadline in February, Members have had more time to develop their requests in relation to the President’s request.
Click here to view the Senate Amendment.
Click here to view the Banking Committee letter is attached.