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Affordable Housing , Community Development , Federal News , Homelessness , Supportive Housing

Obama Signs Deep HUD Budget Cuts

28 November 2011

Several important housing and homelessness programs will receive significantly less funding this year, as will HUD overall, due to a bill containing the HUD spending levels passed by the Congress and signed by President Obama last week.

The minibus bill combines three appropriations bills - Transportation, Housing and Urban Development (T-HUD); Agriculture, Rural Housing, and Food and Drug Administration; and Commerce, Justice, and Science. The remaining 10 appropriations bills have not been passed, and those areas of government will continue under a continuing resolution through December 16.

The cuts to HUD programs will cause increased hardship among a growing number of individuals and families can’t afford rent, and many of them are becoming homeless. Links to more detailed information are below, but the highlights include:

  • $18.91 billion for Tenant-Based Rental Assistance (TBRA).  According to the Center on Budget and Policy Priorities (CBPP), the bill underfunds TBRA contract renewals by $93 million, which could result in loss of between 12,000 and 24,000 vouchers.
  • $1.88 billion for Public Housing Capital, which is 8% less than last year, and 22% less than President Obama proposed in his budget. HUD estimates a $25 billion backlog of unaddressed repairs and other capital needs.
  • $3.96 billion for Public Housing Operating funds - a 14% decrease. And, HUD is instructed to use up to $750 million of public housing authorities’ reserves toward that amount.
  • Earlier versions of the bill included provisions to de-fund state-funded public housing that recently converted to federal under the American Reinvestment and Recovery Act (ACT) of 2008.  These provisions did not pass.
  • The HOME program was cut to $1 billion from $1.6 billion, and new oversight and monitoring provisions were added. These are likely stemming from recent Washington Post coverage of fraud by some entities funded by the program.  HUD estimates the loss of HOME funds will result in 31,000 fewer affordable homes.
  • Community Development Block Grant (CDBG) formula grants were cut to $2.95 billion - 12% below last year and 20% below President Obama’s request.
  • $1.9 billion for McKinney Vento Homeless Assistance grants, the same as last year.  In the days before this bill passed 47 Members of Congress - including Connecticut’s Rep. Joe Courtney - signed a letter to appropriators requesting they protect this important program.
  • Section 202 Supportive Housing for the Elderly was funded at $374 million - 6% below FY11 levels, but 55% below FY10 levels.
  • Section 811 Supportive Housing for Persons with Disabilities increased 10% to $165 million. This funding year HUD will begin implementing changes to the program from the Frank Melville Supportive Housing Investment Act. In particular, the bill instructs HUD to conduct the Project Rental Assistance Demonstration which allows developers to combine Section 811 rental assistance with other capital funding programs.
  • $75 million for Veterans Affairs Supportive Housing (VASH) vouchers, an increase over last year’s $49 million, which will fund approximately 11,000 new vouchers.

To Learn More:
National Low Income Housing Coalition
Enterprise Communities - Budget Chart