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POLICY INSIGHT
BEYOND THE NUMBERS

Congress Cutting HUD Budget as Homelessness Grows

A New York Times editorial yesterday highlighted the importance of funding federal housing programs adequately, especially given the weak economy, high unemployment, and sharp recent increase in homelessness. Unfortunately, Congress appears headed in the opposite direction. The editorial states:

An increase in poverty and rising rents produced a spike in homelessness among families in recent years.  With the economy still weak and 14 million people out of work, the situation is bound to get worse. . . . [T]he startling report to Congress issued by the Department of Housing and Urban Development last June found that the number of homeless families that have turned to shelters jumped by 20 percent, to 567,334 in 2010 from 473,541 in 2007.

Things would no doubt be considerably worse without the $1.5 billion homelessness prevention program that Congress passed as part of the American Recovery and Reinvestment Act.  With that money, HUD helped to prevent more than a million people from becoming homeless.  It provided them with short- and medium-term rental assistance, moving expenses and other services.  It quickly re-housed those who landed in shelters.  With most of that recovery money gone, it is important that Congress provide the $2.4 billion in homeless assistance funding that the administration has requested.

Census data showing a big increase in the number of families living doubled up with friends and relatives suggests that another wave of homelessness may be in the offing.  With these clear needs, Congress must preserve and strengthen the programs that are aimed at helping the vulnerable.  It should also direct more money into a program that builds and renovates affordable housing, which is in increasingly short supply.

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Both the House and Senate, however, are proposing deep cuts in funding for low-income housing programs in HUD’s 2012 budget (see graph).  For instance, both bills freeze homeless assistance funding at $1.9 billion, $470 million below the Administration’s request. Moreover, as we have explained, neither bill provides enough funding to prevent significant cuts in the number of families receiving aid from HUD’s major rental assistance programs, despite their proven effectiveness in reducing family homelessness. Specifically, the bills:
  • Fail to renew Housing Choice vouchers for 25,000 to 40,000 low-income households. The loss of assistance would typically double or triple these families’ monthly housing costs, placing many at risk of becoming homeless.
  • Provide far too little capital funding for public housing, exposing low-income families to deteriorating or even hazardous living conditions and accelerating the loss of units available to low-income families.  Already, more than 165,000 public housing units have been demolished or otherwise lost since 1995 and not replaced with new public housing.
In short, both bills put a disproportionate burden of deficit reduction on the people who rely on federal housing assistance to remain in their homes. Congress should, at a minimum, provide the resources required to continue rental assistance for the number of low-income families that now receive it.
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