President Barack Obama signed the executive order implementing sequestration March 1 , and in the days following , several public housing agencies (PHAs) announced the first impacts of sequestration on low income tenants. Many PHAs report that they will stop issuing tenant-based vouchers to households on their waiting lists due to funding cuts to the program.
While PHAs do not have new vouchers to issue, they reissue existing vouchers when the previous voucher holder leaves the program, usually because of increased income, death, or relocation to a nursing home. These vouchers are given to people on PHA waiting lists, many of whom have been waiting years for housing assistance. Now, they now must remain in unaffordable, unsuitable housing or in a shelter.
Not reissuing these vouchers also means they are lost to the housing authority this year as well as in future years because funding for tenant-based rental assistance is based upon prior-year utilization of vouchers. Households on the waiting list that are in shelters may face a double risk; they may lose the opportunity to live in an affordable unit, and the funding for their shelter may be in jeopardy due to cuts in the Homeless Assistance Grants program.
HUD issued letters to governors on March 4 outlining the overall sequestration cuts each state will experience. The letters include a table with the estimated dollar amount cut for Tenant-Based Rental Assistance, HOME, Homeless Assistance Grants and Housing Opportunity for Persons with AIDS funding. HUD posted these letters to its sequestration website.
USDA’s Rural Housing Service (RHS) sent a document to Members of Congress describing the cuts that will be made to the Rental Assistance Program and the Rural Housing Insurance Fund Program Account. RHS estimates that 10,340 current tenants will lose their rental assistance. The average income of households served by RHS rental assistance is $9,648 a year. RHS projects that the loss of rental assistance will result in vacancies that will cause 411 properties to become delinquent, which could lead to default, foreclosure, and ultimately the long-term loss of affordable units. Without rental assistance to combine with USDA’s new construction programs, the agency estimates that approximately 45 new units will not be created.
A variety of efforts are underway to advocate for a balanced alternative to sequestration. The White House is seeking stories of how Americans are impacted by sequestration, including those about people losing access to housing or shelter.
The Campaign for Housing and Community Development Funding (CHCDF), a group of 75 national advocates facilitated by NLIHC, updated resources on sequestration for advocates including sequestration talking points, deficit reduction guidelines, social media tips and templates, and a sample letter to the editor.
NLIHC signed a letter to Members of Congress urging them to repeal sequestration. In the letter organized by the Center for Effective Government (formerly OMB Watch), organizations write, “There is a simple solution to make this problem go away: repeal the sequester provision of the Budget Control Act of 2011. It is that simple. Congress created sequestration and Congress can repeal it.” NLIHC urges national, state and local organizations to sign onto the letter by March 12.
The continuing resolution (CR), which provides federal agencies with FY13 funding in lieu of appropriations bills and expires on March 27, was thought to be the next negotiation opportunity for Congress to replace the sequester (see next article in Memo.) Now it appears that Congress may decide to move forward with appropriations bills without addressing sequestration. If this is the case, the next major pieces of legislation expected to advance pertain to the FY14 budget. After that, Congress may not be faced with another must-pass bill until the nation once again reaches the debt limit in August.