House Bill Would Cut Assistance to Low-Income Renters

House Bill Would Cut Assistance to Low-Income Renters Last week, the House Appropriations Committee approved a bill for the Department of Housing and Urban Development (HUD) for 2015. This bill is bad news for hundreds of thousands of people who already struggle with housing costs.

An analysis by the Center on Budget and Policy Priorities found that the bill “makes disproportionately deep cuts in housing assistance for low-income families” and “would stall recent progress in reducing homelessness.” If the bill passes, families in poverty will have an even harder time affording a place to live.

Here’s an excerpt from the article:

The House bill provides $35 billion for HUD, an amount that appears at first blush to be a $2.1 billion increase over 2014. However, the Congressional Budget Office (CBO) estimates that receipts from Federal Housing Administration (FHA) insurance and Government National Mortgage Association (GNMA, or Ginnie Mae) mortgage guarantee programs — which are credited to the HUD budget against program funding levels — will decline by nearly $3 billion from 2014 to 2015, which results in the bill’s significantly reducing the overall level of funding for HUD programs and operations. In an apples-to-apples comparison of funding (not counting these receipts, which CBO estimates will total $9.7 billion in 2015), the House bill provides $44.7 billion in new funding for HUD programs in 2015 — or $740 million less than the $45.5 billion Congress allocated for 2014.[2] And the bill takes the majority of this $740 million out of programs for low-income families and individuals.

The House bill’s disproportionate reductions in these programs will mean less rental assistance, and greater hardships, for low-income families. Specifically, the House bill would:

• Risk locking in the loss of more than 70,000 Housing Choice Vouchers cut in 2013 due to sequestration. In 2014, Congress provided enough funding to restore about half of the more than 70,000 vouchers cut in 2013 as a result of sequestration and to renew close to 2.15 million housing vouchers overall. But the new House bill fails to renew all of these vouchers in 2015. The bill also cuts funding for the administrative expenses that local housing agencies incur in operating housing voucher programs by $150 million while failing to include any of a widely supported set of changes to streamline program administration, increase efficiency, and help agencies cut costs, such as by allowing them to reduce the frequency of income checks for residents on fixed incomes such as poor elderly individuals living on modest Social Security checks.

• Stall recent progress on reducing homelessness. The bill would freeze funding for homeless assistance grants at the 2014 level, rejecting the President’s 2015 budget request for a $301 million increase to develop 37,000 new units of permanent supportive housing for people with disabilities who have been homeless for extended periods. The numbers of so-called “chronically” homeless people have fallen by 16 percent since 2010, according to HUD, and the additional units of supportive housing are needed to achieve the worthy goal of eliminating chronic homelessness by 2016. While the House bill does contain $75 million for approximately 10,000 new housing vouchers for homeless veterans, the bill does not provide sufficient funds to renew all of the housing vouchers that Congress funded in 2014, as just noted, which include more than 60,000 vouchers targeted to homeless veterans that Congress has funded in prior years. The failure to renew all housing vouchers now in use means that fewer low-income families and individuals would receive any rental assistance, which likely would result in some increase in homelessness.

• Deepen the underfunding of public housing. The House bill would cut funding for public housing by $165 million below the 2014 level, even before adjusting for inflation, despite the fact that the 2014 level itself was well below what HUD metrics show public housing agencies need to operate public housing developments and meet pressing repair needs. The cuts would increase the risk that living conditions for a number of the 1 million households living in public housing, most of which consist of seniors or people with disabilities, will deteriorate. The House bill also omits an important Administration proposal to expand the Rental Assistance Demonstration, a promising initiative that enables agencies to respond to the shortage of funding for repairs by leveraging private investment to renovate public housing.

• Reduce funding for new affordable housing and impose deep cuts in other areas across the HUD budget. The bill would cut funding for the HOME Private Investment Partnerships program, which helps states and localities rehabilitate or build new affordable rental housing and assist low-income homeowners, by $300 million — or 30 percent — below the 2014 level. The bill also contains: a $40 million, or 36 percent, cut in lead-based paint hazard reduction grants; a $27 million (8 percent) reduction in Housing Opportunities for People with AIDS (HOPWA) grants; and a $20 million (30 percent) cut in grants in support of fair housing enforcement activities.

Read the full article on the Center on Budget and Policy Priorities website.

Tags: affordable housing, Center on Budget and Policy Priorities, Housing and Urban Development, HUD, reducing homelessness