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Tight Spending Caps Force Cuts in Low-Income Housing Assistance

June 29, 2015 at 2:30 PM

The Senate Appropriations Committee-approved bill funding the Department of Housing and Urban Development (HUD) shows the harsh consequences for low-income families of Congress’ failure to loosen the tight, sequestration-level spending caps set by the 2011 Budget Control Act.

Like the House-approved funding bill, the Senate bill correctly prioritizes federal rental assistance in distributing the limited funds available, raising funding for Housing Choice Voucher renewals by $496 million and Section 8 Project-Based Rental Assistance by $1.1 billion.  As I’ve explained, these programs need more funding just to continue assisting the roughly 3.3 million low-income seniors, people with disabilities, families with children, and others who rely on them to keep a roof over their heads.

The bill, which the committee approved last week, would also fund new vouchers for some 10,000 homeless veterans and their families, as well as 2,500 vouchers to help families with children at risk of being separated due to lack of adequate housing.  The bill also includes $40 million for new initiatives to help homeless youth.  Federal investments in new supportive housing over the past decade have sharply reduced veterans’ and “chronic” homelessness (repeated or extended periods of homelessness among people with mental illness or other disabilities).  But much work remains to end homelessness among these groups, as well as among children and other groups.  These Senate provisions are therefore welcome, although they fall short of the President’s proposals for 67,000 vouchers to fully restore sequestration cuts.

The tight spending caps, however, forced the Senate committee to take many steps that will hurt low-income families.  For example, the Senate bill:

  • Provides $352 million less for voucher renewals than HUD estimates will be needed to prevent a cut in the number of families assisted.  Some 85,000 fewer families were using housing vouchers in December 2014 than two years earlier due to sequestration cuts.  Housing agencies began to restore tens of thousands of those vouchers this year, but the Senate bill risks undercutting that progress.  And it lacks most of the additional funding the Administration requested to fully restore sequestration cuts in the voucher program.
  • Cuts maintenance and repair of public housing by $132 million (7 percent).  To preserve this essential source of affordable housing for low-income families, Congress must address public housing’s $26 billion repair backlog.  The Senate bill, however, would worsen the backlog.  (On a positive note, the bill would modestly expand the Rental Assistance Demonstration, a promising initiative that enables agencies to access more private capital to rehabilitate public housing.)
  • Practically eliminates the HOME program, which gives states and localities flexible funds to build and repair affordable housing.  Congress cut HOME funding in half between 2010 and 2015, from $1.8 billion to $900 million.  The Senate bill slashes it to just $66 million. 

In a follow-up post, I’ll discuss the Senate bill’s ill-conceived proposal to massively expand the Moving to Work deregulation demonstration. 

TABLE 1
HUD Housing Assistance Funding for FY 2016
(figures in millions)
  2015 Obama 2016 Budget House 2016 Bill Senate 2016 Bill
Housing Vouchers $19,304 $21,123 $19,919 $19,935
Renewals $17,486 $18,334 $18,151 $17,982
Administrative fees $1,530 $2,020 $1,530 $1,620
New/restoration vouchers $75 $512 $0 $95
Public housing operations $4,440 $4,600 $4,440 $4,500
Public housing capital $1,875 $1,970 $1,681 $1,743
Section 8 PBRA $9,730 $10,760 $10,654 $10,826
Homeless Assistance $2,135 $2,480 $2,185 $2,235
Elderly housing (202) $420 $455 $414 $420
Housing for people with disabilities (811) $135 $177 $152 $137
HOME $900 $1,060 $767 $66  

Source:  CBPP analysis of Office of Management and Budget and congressional budget documents


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