Strengthening Federal Rental Aid Should Be 2018 Budget Priority

Lawmakers are continuing to negotiate a two-year deal to raise federal spending caps, setting the stage for 2018 funding legislation that would include the Department of Housing and Urban Development (HUD).  In such legislation, Congress should include the funds to strengthen HUD’s rental assistance programs that help seniors, people with disabilities, and families with kids afford decent, stable homes, which are essential for healthy and productive lives.

Despite the improving economy, the number of families with children, seniors, people with disabilities, and others who struggle to pay rent and avoid homelessness remains at near historic highs.  In 2016, 9.8 million renter households had incomes of less than $30,000 and paid more than half of their income for housing costs.  That’s somewhat lower than the 2011 peak (10.4 million households), but still 40 percent higher than in 2001, Harvard’s Joint Center for Housing Studies finds. Such a severe housing cost burden makes it hard for these households to pay for medicine, adequate food, transportation to work, and other essentials, and it raises their risk of housing instability and homelessness.

First, policymakers must raise the federal spending caps — set by the 2011 Budget Control Act (BCA) and subsequently reduced by the BCA’s “sequestration” process — as the President and Congress have done every year since sequestration took effect.

Second, policymakers must allocate more adequate funding for housing in the 2018 budget legislation that they’ll soon complete. A high priority for additional funds should be programs that reduce homelessness and help families afford decent, stable homes, including:

• Renewing Housing Choice Vouchers, which help some 2.2 million low-income households pay rent and play a critical role in communities’ efforts to reduce homelessness, including among veterans.  HUD recently warned state and local housing agencies that they face funding shortfalls for voucher renewals under the 2018 funding bills that the Senate and House Appropriations Committees approved last year.  Fully renewing housing vouchers in 2018 will require $19.6 billion, about $230 million above the Senate bill level and more than $900 million above the House bill level, HUD estimates.  Some 25,000 families that are now using housing vouchers would lose them under the Senate bill, while 105,000 would lose them under the House bill.

• Expanding rental assistance to reduce homelessness and other severe affordability problems.  The Senate bill includes $85 million for about 10,000 new housing vouchers, including $45 million for vouchers for homeless veterans, $20 million to help poor families avoid losing their children to foster care because they can’t afford adequate housing, and $20 million for vouchers to help people with disabilities live in integrated settings in the communities they choose.  The final 2018 funding bill should include these important investments.  (These investments plus adequate renewal funding and a modest-but-necessary increase in program administrative funding would bring total housing voucher funding to $21.6 billion.)

  The final bill should also include a substantial increase in funding for homeless assistance grants, including funding to develop additional permanent supportive housing for individuals and families, which has played a critical role in reducing long-term homelessness in recent years.  The National Alliance to End Homelessness recommends $2.6 billion in funding.

• Providing more adequate funding for public housing. Public housing has more than a $26 billion backlog of repair needs that must be addressed to preserve this critical source of affordable housing for low-income seniors, people with disabilities, and families.  The BCA’s rigid spending caps have strangled federal aid that would address this problem.  Under the caps, federal housing aid fell sharply from 2011 to 2013, and annual funding in 2017 remained $2 billion (4 percent) below the 2010 level, adjusted for inflation.  Funding for the operation and maintenance of public housing, which remains home to roughly 1 million low-income households (mostly seniors and people with disabilities), has been hit particularly hard.  In the final bill, we recommend increasing funding for public housing operations and maintenance to at least $6.5 billion, which is the Senate bill’s level.