During the week of October 17, the Senate debated a “minibus” spending package that includes the FY12 appropriations bills for Transportation, Housing and Urban Development, and Related Agencies (T-HUD); Agriculture, Rural Development, and Food and Drug Administration; and Commerce, Justice, and Science. A minibus bill groups two or more of the 12 appropriations bills into a single package.
The T-HUD portion of the Senate bill, S. 1596, would underfund the four main programs serving extremely low income households: Tenant Based Rental Assistance, Project Based Rental Assistance, Public Housing, and Homeless Assistance Grants. The bill would also make cuts to numerous other critical HUD programs. The Rural Housing portion of the bill, H.R. 2112, would cut rural rental assistance and other rural housing programs below the FY11 funding level and the President’s request. The White House issued a Statement on Administration Policy (SAP) on the Senate minibus bill on October 17, with details on Rural Housing and HUD programs.
The details of the bill are as follows:
Tenant Based and Project Based Rental Assistance Programs
S. 1596 would not provide sufficient funding to renew all vouchers in use in the Tenant Based Rental Assistance program. The Senate bill would provide $17.14 billion for contract renewals. In an October report on both the House and Senate T-HUD bills, the Center on Budget and Policy Priorities calculated that the Senate funding level could cause up to 25,000 vouchers to be lost.
The SAP states that the Senate funding level for the Tenant Based Rental Assistance and Project Based Rental Assistance programs “is sufficient to maintain rental assistance to current low-income tenants,” but according to HUD officials that should not be interpreted to mean that the Senate funding level is adequate to renew all vouchers currently in use. Without sufficient funding, PHAs may have to take returned vouchers out of use rather than provide them to the next household on a waiting list, causing loss of vouchers by attrition.
The Senate bill also rescinds $750 million in reserve funds for the TBRA program. HUD said this could leave housing authorities with reserves well below the one-month minimum suggested in the Senate bill.
The Senate bill would also cut TBRA Administrative Fee to $1.4 billion, which is $250 million lower than the President’s request. The National Association of Housing and Redevelopment Officials reports cuts in Administrative Fees will force PHAs to reduce staff, which could result in slower voucher processing, decreasing the number of vouchers in use and, ultimately, a loss of vouchers.
The bill would also underfund the Project Based Rental Assistance program. HUD has recalculated the amount of funding needed in order to renew all contracts with property owners in FY12 and the Senate bill would not provide sufficient funding (see Memo, 10/14). The Senate bill also rescinds $200 million from the Housing Certificate Fund that HUD has used to supplement the Project Based account in the past.
If there is not sufficient funding to renew all Project Based Rental Assistance contracts, HUD would either have to fund some contracts and not others, or would have to provide short-term contracts instead of full-year contracts. Providing short-term contracts diminishes participating property owners’ confidence in the program and encourages contract opt-outs.
The T-HUD bill would not provide sufficient funding for the Public Housing Capital Fund. The Administration originally requested $2.4 billion in FY12 funding, but the Senate bill would provide just $1.8 billion. The SAP called for an increase in the Public Housing Capital fund to $2 million.
The Senate bill would level-fund Homeless Assistance Grants at $1.9 billion, nearly $500 million below the President’s FY12 request. In the SAP, the Administration urges the Senate to increase funding for this account, enabling HUD to fully implement the HEARTH Act and to make progress on the federal plan to end homelessness. “Without additional funding, HUD will be unable to provide rapid housing interventions to 8,400 disabled homeless persons and families, as well as approximately 16,500 households,” according to the SAP.
Other HUD Programs
The Senate bill would make new or continue existing cuts to other HUD programs providing rental housing to very low income households including the Section 202 Housing for the Elderly, Section 811 Housing for People with Disabilities and HOME Investment Partnerships programs. Other HUD programs including the Community Development Fund, the Self Help Homeownership Opportunity program, Fair Housing and Equal Opportunity, Housing Opportunities for Persons with AIDS, and Healthy Homes and Lead Hazard program, among others. The SAP also calls urges the Senate to put more funds into CDBG and HOME.
Senators filed several amendments to the T-HUD portion of the bill. Senator Tom Coburn (R-OK) offered S.A. 792, to end payments to landlords of multi-family properties with certain low financial or physical condition ratings. HUD already has a process of assuring that properties in these categories improve conditions and ending contracts if improvements are not made. The Senate voted against this amendment by a vote of 59 to 40.
Another amendment filed by Senator Coburn, S.A. 795, would rescind funding for certain HUD construction and renovation projects that had not used funding within a certain timeframe or met certain funding criteria. This amendment is pending.
Senator John McCain (R-AZ) filed amendment S.A. 742 to cut funding for the Self Help and Homeownership Opportunity Program. This amendment is not pending.
Senator Sherrod Brown (D-OH) filed two amendments to increase funding for HUD programs and offset these increases with decreases in HUD’s administrative funding. The first amendment, S.A. 874, would increase funding for the Fair Housing Initiatives Program. This amendment was modified and agreed to by a voice vote. His second amendment, S.A. 780, would restore funding to the Housing Counseling program to the FY11 level of $87.5 million. This amendment is not pending.
Senators Jeff Merkley (D-OR) and Scott Brown (R-MA) filed S.A. 906 that would have expanded HUD’s ability to preserve assisted housing units. This amendment is not pending.
The Senate will vote on several amendments once it returns to consideration of the bill. The Senate will then proceed with additional pending amendments that are determined to be germane.
The Agriculture bill, H.R. 2112, which served as the vehicle for the other two appropriations bills in the minibus, passed with cuts to rural housing programs. The Senate bill sets the Section 521 Rural Rental Assistance program at $904.7 million, $2 million below the President’s FY12 request and $51 million below FY11 levels. The Senate bill funds the Section 515 Rental Housing program at $65 million, $30 million below the Administration’s FY12 request and $5 million below FY11. Other rural housing programs were cut in the Senate bill to levels lower than both the FY12 Administration request and the FY11 funding levels.
The President’s FY12 budget request included cuts to many Rural Housing programs. In the SAP, the Administration urged the Senate to make these cuts and “free up scarce resources for higher priority need and more effective programs such as food safety.” Rural Housing programs are the only accounts that the Administration’s SAP urged the Senate to terminate and apply funding to non-housing related programs.
The Senate is on recess the week of October 24 and is expected to take up the minibus as soon as it returns the week of October 31. Senate Majority Leader Harry Reid (D-NV) filed for cloture on October 20 and is anticipated to hold a vote on H.R. 2112 early in the week of October 31.
The House and Senate then negotiate final spending bills for T-HUD and Agriculture. The House Committee on Appropriations has not passed its FY12 T-HUD bill, but did pass its FY12 Agriculture in June (see Memo, 6/17).
Congress has until November 18 to pass all of its appropriations bills before the current continuing resolution (CR) funding the government expires. The Senate is expected to move forward with additional minibus appropriations packages after passing H.R. 2112. House leadership may also decide to move appropriations bill in minibus packages. Congress may not complete its appropriations work by November 18, and would then have to pass another CR to avoid a government shutdown. The Senate may include a third CR as part of H.R. 2112.
View the CBPP report: www.cbpp.org/files/10-12-11hous.pdf