THUD House Appropriations Bill Includes Cuts to Housing Programs

House Appropriations Transportation-HUD subcommittee recently approved a FY 2016 Transportation Housing and Urban Development (THUD) appropriations bill that would provide $42 billion for HUD, an increase of $1 billion above the FY 2015 enacted level and $3 billion below the Obama administration’s budget request.

The measure includes cuts to certain programs, including public housing, VASH, and Choice Neighborhoods Initiative. The subcommittee-approved measure also rejects first-time funding for the National Housing Trust Fund. The fund was created in 2008, but laid dormant until recently when Federal Housing Finance Agency (FHFA) Director Melvin L. Watt instructed Fannie Mae and Freddie Mac to begin setting aside and allocating funds. The spending bill would direct the $120 million that the Obama administration sought for the National Housing Trust Fund to the Home Investment Partnership Program.

In a statement on the proposed House Republican budget cuts, HUD Secretary Castro stated, “The House’s current proposal severely limits our ability to end homelessness, invest in distressed communities, and provide housing support for very low-income households. In a nation founded on the principle of equality of opportunity, it’s unacceptable to support anything less than an expansion of opportunity for all.”

The programs that the proposed GOP budget would mostly affect are:

Housing Choice Voucher (HCV) program. HUD’s Housing Choice Vouchers would be funded at 6 percent less than the president’s request. In total, compared to the president’s budget, the GOP budget would provide roughly 100,000 fewer vouchers. Not only does the budget fail to restore the 67,000 vouchers lost due to the 2013 sequestration, the funding level is also insufficient to renew 28,000 existing vouchers or provide full funding for tenant protection needs.

Choice Neighborhoods. Due to the success and high demand of the Choice Neighborhoods program, HUD requested $250 million in the FY 2016 budget to support the transformation of underserved communities. The proposed GOP budget would fund this program at only $20 million, about 92 percent less than the president’s request. Each Choice Neighborhood grant is approximately $30 million, so the Republican budget won’t fund even one full grant.

Homelessness. Compared to the president’s budget, the GOP budget would cut support for Homeless Assistance Grants by roughly $295 million, or 12 percent, and would support 15,000 fewer homeless or at-risk families with rapid re-housing and 25,500 fewer units of permanent supportive housing targeted to the chronically homeless.

Public Housing Capital Fund. The GOP budget would cut the Public Housing Capital Fund by 15 percent or $289 million. This would cause further deterioration of much-needed public housing units.

Healthy Homes. The GOP budget cuts HUD’s Office of Lead Hazard Control and Healthy Homes by nearly 40 percent, resulting in at least 3,400 fewer low-income children receiving lead hazard control grant assistance in their home. The GOP budget would eliminate $35 million to protect young children from lead poisoning and other housing-related health and safety hazards such as mold and moisture, radon, pests, and other asthma triggers.

Rental Assistance Demonstration. The GOP budget would prevent the modernization of current public housing and affordable housing units by not removing the cap for HUD’s Rental Assistance Demonstration Program. In addition, HUD requested $50 million for the RAD program which wasn’t included in its budget.

Affordable housing units. The GOP budget would eliminate $233 million in HOME funds, which helps states, cities, and municipalities build low-income housing. HUD requested $1 billion, and Congress is funding it at $767 million.