HUD’s FY2014 Budget Doesn’t Reflect Sequestration Cuts

HUD Secretary Shaun Donovan recently released details of the Obama administration’s proposed Fiscal Year (FY) 2014 HUD budget. HUD’s proposed 2014 budget provides $47.6 billion, an increase of $4.2 billion or 9.7 percent above the 2012 enacted level, and a 6.7 percent increase over 2013 funding levels. However, these numbers don’t reflect the cuts imposed by sequestration.

Unless Congress cancels the sequestration in any major budget agreement, HUD funding for each program will be cut by 5 percent and the HUD budget will remain subject to the funding caps imposed by the Budget Control Act (BCA), ensuring that HUD’s proposed numbers won’t be realized.

According to the current budget proposal, more than 90 percent of this funding increase is used to maintain current levels of rental and homelessness assistance for vulnerable families, the overwhelming majority of whom earn less than 30 percent of their area’s median income. HUD’s 2014 budget request includes:

• $37.4 billion to provide rental housing assistance to 5.4 million low-income families;
• $400 million for HUD’s Choice Neighborhoods Initiative to transform 30 neighborhoods with extreme poverty into opportunity-rich, mixed-income neighborhoods; and
• A combined $526 million to sustain rental assistance and produce an estimated 4,100 new supportive housing units through HUD’s Section 202 Supportive Housing for the Elderly Program and Section 811 Supportive Housing for Persons with Disabilities Program.

The proposed budget reduces funding for the HOME Investment Partnerships Program, and reduces costs in HUD’s core Rental Assistance programs by simplifying the administration of the medical expense deduction, better targeting rental assistance to the working poor, and setting more equitable public housing rents.