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Sequestration’s Bad News for Low-Income Housing

March 8, 2013 at 7:05 PM

In a new guest post for the Open Society Foundations,  Doug Rice points out that the “sequestration” budget cuts will harm many low-income families — and explains how the Senate can mitigate the damage somewhat by adopting an updated 2013 budget for the Department of Housing and Urban Development.  Here are the key points:

Last Friday, the White House Office of Management and Budget released details of the across-the-board budget cuts known as sequestration, including the fact that funding for the Housing Choice Voucher (HCV) program will be cut by $938 million this year. We estimate that this cut will cause more than 100,000 low-income families to lose rental assistance over the next 12 months – and that the figure could be as high as 140,000.

These cuts will fall on highly vulnerable families. Half of the 2.1 million households that the HCV program serves are seniors or people with disabilities; most of the rest are families with children. On average, these households have incomes of about $12,500 per year, well below the poverty line. Without rental assistance, housing would be unaffordable for these families, placing them at heightened risk of becoming homeless and sharply reducing the resources they can use to buy food, medicine, and other essentials. . . .

What should be done to protect vulnerable people — and the general public — from the increased hardships that sequestration will bring? First and foremost, policymakers should replace sequestration with a balanced package of tax and spending measures that do not increase poverty or inequality.

But that’s not likely to happen soon – and the effects of the cuts on low-income families in communities across the country will be growing. Meanwhile, Congress must enact, by March 27, legislation to fund the federal government for the remainder of the year. While this legislation will likely leave sequestration untouched, it offers the opportunity to reapportion funding among the various areas of the federal budget in ways that would mitigate some of the harmful effects of sequestration.

This week, the House of Representatives approved legislation that does this — but only for the Department of Defense and the Veterans’ Administration. Funding for other federal agencies is continued at the 2012 level (with exceptions for a few programs), with sequestration’s cuts then applied against those amounts.  Senator Barbara Mikulski, chair of the Senate Appropriations Committee, is spearheading a bipartisan effort to add updated budgets for some of the other federal agencies.  It is essential that the Department of Housing and Urban Development be included in this effort.  An updated HUD budget could, for example, sharply reduce the expected shortfall in funding for public housing operations, and also lessen the number of families losing voucher assistance.  Such action would be a step in the right direction in support of low-income families.

Click here for the full post.