October 14 was the deadline for standing committees of the House and Senate to submit recommendations to the Joint Select Committee on Deficit Reduction, known as the Super Committee. The Super Committee is tasked with identifying $1.2 trillion in deficit reduction savings under the Budget Control Act of 2011, passed in August (see Memo, 8/5). The Super Committee must submit its plan to Congress on November 23.
Super Committee members are meeting daily through the weekends in closed door sessions. Little about their negotiations has been made public. Members are allowed to bring only one staff person in the room with them at a time, a measure taken to reduce leaks about the negotiations.
If the Super Committee cannot agree upon a plan, discretionary funds would be sequestered in order to meet the $1.2 trillion deficit reduction goal. This would result in deep cuts to HUD and USDA housing programs, as well as other programs that assist low income people.
The Republican and Democratic Members of House Committee on Financial Services submitted separate comments to the Super Committee. The Republicans’ suggest that the Super Committee “scrutinize the HUD budget closely for potential savings.” They suggest reducing the size and funding of some programs and eliminating others altogether.
The Republicans also recommend that rescinding unobligated balances in the Public Housing Capital and Operating Funds after 36 months. They claim that the spend-out rate for the Capital Fund is slow and that there are significant unobligated balances in the Operating Fund. They also criticize the Operating Fund for lacking “acceptable performance goals or data to determine wither funds are meeting the program’s objectives.”
They also recommend reducing the size of the Community Development Block Grant program, saying that “generous funding and lax oversight has led to wasteful spending, often of frivolous pork barrel projects.” They write that dollars often get spent on infrastructure, “diverting dollars from those communities with the greatest need.” Republicans call it a “revenue sharing program for states and localities.”
The Republicans also suggest rescinding unobligated balances from the Legal Assistance programs authorized by the Dodd-Frank Act and from the Home Affordable Modification Program. Rescinding funds from HAMP is consistent with legislation passed by the House in March.
Programs they target for elimination are HOPE VI and the Choice Neighborhoods Initiative, the Brownfields Economic Development Initiative, the Rural Housing and Economic Development program, the Federal Housing Administration Refinance program, the Sustainable Communities program, and the Neighborhood Stabilization Program (NSP). Eliminating NSP is consistent with bill passed by the House in March. They also say that President’s proposed Project Rebuild initiative is similar to NSP, which they believe has been ineffective in addressing the “root causes of the increase in foreclosures- an excess of housing supply and the depreciation of overinflated home prices.”
The Republicans also suggest eliminating all funds for NeighborWorks America, which say duplicates HUD programs.
The Democrats’ letter identified a range of “revenue enhancements” for consideration as opposed to spending cuts.
View the House Financial Services Democratic letter: http://nlihc.org/doc/HFSC_Democratic_Letter_to_Super-Committee_10-12-11.pdf
View the House Financial Services Republican letter: http://nlihc.org/doc/HFSC_Republican_Letter_to_Super-Committee_10-14-11.pdf