On June 19, the House Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies (THUD) marked up and passed its FY14 appropriations bill. The bill underfunds, cuts, or eliminates numerous HUD programs including the major rental housing programs.
NLIHC President Sheila Crowley issued a statement, expressing deep concern that the House THUD Subcommittee bill as passed “moves the House a step closer to dismantling the housing safety net for the poorest Americans.” The Subcommittee bill would ensure the loss of over 100,000 Tenant-Based Rental Assistance vouchers, risk the loss of Project-Based Rental Assistance contracts, and provide insufficient funding to maintain public housing units.
Tenant-Based Rental Assistance would be funded at $18.6 billion, 7% lower than the President’s budget request. Contract renewals would be funded at $17 billion, $968 million below the President’s request and $242 below FY13 pre-sequestration levels.
The Section 811 Mainstream Voucher renewals would be funded at $111 million, consistent with the President’s request. Tenant Protection Vouchers would be funded at $75 million; half of the FY13 enacted level. The Family Self Sufficiency program would be funded at $60 million, consistent with FY13 pre-sequestration funding but $15 million lower than the President’s FY14 request.
Project-Based Rental Assistance (PBRA) would be funded at $9.4 billion, underfunding the account by $2 billion. The Subcommittee bill would provide $100 million more than the FY13 pre-sequestration level but $800 million less than the President’s budget request. However, the Administration’s budget request is insufficient to fund contracts with all current owners for a full year and that the account could require up to $1.2 billion more than HUD’s FY14 request to fully fund contracts.
For a second year, the President proposes providing short term contracts to a portion of the program’s participating private owners. The House underfunded this account in its FY13 THUD Subcommittee bill, but Subcommittee members expressed dismay at this decision. It was widely understood that Subcommittee members wanted to increase this account during conference, however, the FY13 THUD bill never reached conference. The FY14 Subcommittee bill would apply the receipts from the Housing Certificate Fund to PBRA, continuing current practice.
The Public Housing Capital Fund would receive only $1.5 billion, a $277 million cut below FY13 pre-sequestration funds and $500 million below the HUD request. In 2012, HUD estimated that public housing capital needs were in excess of $26 billion. The Subcommittee bill would also not provide funding for the Resident Opportunity and Self-Sufficiency program as a set aside within the Capital Fund, consistent with its FY13 bill.
The Subcommittee bill would provide only $4.2 billion for the Public Housing Operating Fund. While this figure is equal to the funds appropriated in FY13, funding was cut dramatically in FY12. The bill would provide nearly $340 million less than the President’s budget request.
The Subcommittee bill would cut the HOME Investment Partnerships program 26% to $700 million. Funding for the program has been repeatedly slashed, dropping from $1.8 in FY10 to its FY13 final funding level of $948 billion. The Community Development Fund, which includes CDBG, would be cut from $3.3 billion to $1.7 billion, the lowest funding level since 1975.
The bill would cut the Housing Opportunities for Persons with AIDS (HOPWA) program by $14 million below the final FY13 funding level of $314 million, a 10% decrease below the President’s request. The Section 811 Housing for Persons with Disabilities program would be funded at $126 million, a 20% decrease below FY13 final funding but level with the President’s FY14 budget request. The Native American Housing Block Grants would be reduced by 3% compared to the final FY13 funding of $616 million. The bill would provide $75 million for 10,000 Veterans Affairs Supportive Housing (VASH) vouchers, despite underfunding Tenant-Based voucher renewals. The VASH program was exempt from FY13 sequestration cuts.
The Subcommittee bill would eliminate funding for the Native Hawaiian Housing Block Grants entirely and rescind the FY13 pre-sequestration funding in the Choice Neighborhoods Initiative account.
The Subcommittee bill would cut Fair Housing and Equal Opportunity and the Healthy Homes and Lead Hazard Control programs by 16% and 56%, respectively. The Housing Counseling Assistance program would be funded at $35 million, 18% below the FY13 final level. HUD’s Policy Development and Research account would be cut by over 50% from $44 million to $21 million.
A lone bright spot in the bill includes increasing funding for the Homeless Assistance Grants to $2.08 million, an 8% increase over FY13 though 12% below the President’s budget request.
The Self-Help Homeownership Opportunity Program (SHOP) would be funded at $10 million, level with FY13. The President’s budget request has not included funding for the SHOP program in recent years, instead encouraging SHOP activities to occur as an eligible activity of the HOME program.
The Subcommittee bill would also implement a cost savings proposal that would raise rents on 700,000 elderly and disabled households living in federally assisted housing. The bill includes language to increase the threshold for deducting medical expenses from 3% to 10% without maintaining the standard deduction for households that include elders or people with disabilities. Without increasing the standard deduction for these households, as all versions of the Section 8 Voucher Reform Act and the Affordable Housing and Self Sufficiency Improvement Act have over the years, this increase to the exemption threshold would increase rents for these households with high medical costs.
The bill would also change the definition of extremely low income, providing significant cost savings. Versions of these provisions have been included in earlier drafts of comprehensive affordable rental housing reform bills in the House and Senate, and both were requested by HUD in its FY14 budget request to Congress.
The Subcommittee bill would also extend language to authorize project-based vouchers in lieu of tenant-based vouchers that would otherwise be issued for expiration of a Rent Supplement (Rent Supp), Section 236 Rental Assistance Payment (RAP), or Section 8 mod rehab contract. This language, championed by Senator Jeff Merkley (D-OR) and former Senator Scott Brown (R-MA), was included in HUD’s FY12 appropriations bill as part of the Rental Assistance Demonstration, and its authority will expire at the end of FY13 unless it is extended by Congress. The Subcommittee bill extends the authority for the project-basing of these tenant-protection vouchers through FY15. The bill would also increase the number of public housing units that could convert subsidy streams under the Rental Assistance Demonstration from 60,000 to 150,000.
In his opening remarks at the June 19 mark up, Subcommittee Chair Tom Latham (R-IA) said that the Subcommittee faced “many challenges” in writing the bill and “made difficult tradeoffs.” He said that the Subcommittee’s bill protects “higher priority programs” and that to meet these obligations, cuts other programs. Chair Latham said the bill would fund housing aid for every family receiving assistance at the beginning of FY14 and provide new vouchers to 10,000 veterans.
Chair Latham thanked the Ranking Member Ed Pastor (D-AZ) and the minority Subcommittee staff, acknowledging that “they are not a huge fan of the product.” Mr. Pastor expressed disappointment in the bill saying, the Subcommittee’s “impossible allocation” results in a bill that “does not adequately address... infrastructure and housing needs.”
Appropriations Committee Ranking Member Nita Lowey (D-NY) said that the bill “ensures that demand for affordable housing continues to exceed the supply” and that the bill will “further impair economic recovery.” Referencing the next steps for the bill, Ms. Lowey said that she has “considerable hope that we can improve the bill… but [that] can only be done if sequestration is reversed.” She also commented to Mr. Latham that it is “clear to me that you’re not very happy with this process” and that she hoped to work collaboratively to improve the bill.
Members were asked to hold any amendments until full Committee mark up, and the Subcommittee bill was agreed to by a voice vote. The House Committee on Appropriations is scheduled to mark up the bill on June 26 at 10:30 am EST in room 2359 of the Rayburn House office building.
The National Low Income Housing Coalition urges House Appropriators to increase funding for rental housing programs serving extremely low income households as they move forward with establishing FY14 funding levels.
View NLIHC’s budget charts: http://bit.ly/1al9ivw
View the House THUD Subcommittee bill: http://1.usa.gov/12SRJTg
View Sheila Crowley’s June 14 Statement on the bill: http://nlihc.org/press/releases/2638
This article was updated on July 1, 2013.