November 14, 2003

By Will Fischer and Barbara Sard

HTM of full report
PDF of full report

View Related Analyses

If you cannot access the files through the links, right-click on the underlined text, click "Save Link As," download to your directory, and open the document in Adobe Acrobat Reader


The House of Representatives and the Senate Appropriations Committee have approved versions of a fiscal year 2004 appropriations bill (H.R. 2861 and S. 1584) funding the Department of Housing and Urban Development and certain other agencies that contain significantly different provisions for funding the “Section 8” housing voucher program.  It is uncertain at this point whether the full Senate will take separate action on the HUD appropriations bill (most likely approving a version similar to the committee bill) or whether the bill will be included with other appropriations measures in an “omnibus” appropriations bill.

In either case, decisions expected to be made in the next few weeks by the House-Senate conference committee that shapes the final version of the bill will determine whether enough funding will be available in 2004 to cover all of the existing housing vouchers that will be in use.  The voucher program currently assists more than two million low-income households, most of them either working families with children or elderly and disabled individuals.

Unfortunately, HUD has not explicitly acknowledged that its estimates of the funding needed to support housing vouchers, and therefore the direct funding levels provided in the House and Senate bills, are too low.  A senior HUD official, however, has conceded that at the start of fiscal year 2004 the average cost of a voucher — a key factor in determining the funding needed to support the program — was well above the level HUD had estimated.  In addition, three separate estimates — issued by the Congressional Budget Office, the Office of Management and Budget, and the Center on Budget and Policy Priorities — indicate that the funding needs of the voucher program are higher than HUD projected.  The estimates, which are based on program data that are more recent than the data HUD used, leave little doubt that the conference committee needs to make available additional resources — either through a requirement like that in the Senate bill that HUD use prior-year funds or through rescission and reappropriation of those funds — if it is to be certain that cuts in voucher assistance will be averted.  A fuller explanation of these complex but critically important data issues is provided below.