From our friends at IACED:
Federal Funding for Community Development is Cut in Fiscal Year 2012 Appropriations
Congress has been working on the annual appropriations bills to fund the federal government. Read lACED’s last blog post here. On November 14, a joint House and Senate conference committee released the final report for the combined Fiscal Year (FY) 2012 Appropriations for Agriculture. Commerce/Justice/Science (CJS) ancl Transportation/Housing and Urban Development (THUD).
The conference committee report was approved with bipartisan support, with all but one of the 38 conferees supporting the legislation. The bill would provide $128 billion for the included programs. with $55.6 billion for the THUD portion of the package, which is actually an increase of $183 million from FY 2011 levels. The legislation provides $43.8 billion of total funding for the Department of Housing and Urban Development (HUD). The net total for HUD. however. is only $37.3 billion: this is a $3.8 billion reduction from FY 2011 levels, and $4.7 billion below the Presidenrs request.
The appropriations bill (H.R. 2112) will be sentto the House and Senate ftoors on November 17, 2011 for a final vote. The legislation must have the Presidenrs signature by Friday to meet the deadline o f the last continuing resolution and avoid a government shut down. A new continuing resolution (CR) is included in the legislation to keep the remainder of the government running through December 16 as Congress continues to consider FY 2012 funding for other agencies.
H.R. 2112 includes the following funding levels for HUD programs:
- $17.2 billion for Tenant-Based Rental Assistance contract renewals (3.4 percent increase)
- $9.3 billion for Project-Based Rental Assistance (1 percent increase)
- $1 billion for the HOME Investment Partnerships Program (38 percent decrease)
- $3 billion for the Community Development Block Grant program (11.6 percent decrease)
- $1.875 billion for the Public Housing Capital Fund (8 percent decrease)
- $3.96 billion for the Public Housing Operating Fund (14 percent decrease)
Insight into the HUD cuts include:
- No funding for the Sustainable Communities Initiative.
- Section 8 tenant-based vouchers would receive $18.9 billion, above both the House and Senate version, which the summary describes as · sufficient funding to renew ever individual and family that received assistance through Section 8 tenant-based vouchers·. Veterans Affairs Supportive Housing vouchers woulcl receive $75 million
- Project-based Section 8 (not mentioned in the summary), would receive $9.3 billion, it does not appear to fully fund renewals.
- HOME would receive only $1 billion, a severe cut from FY 2011 levels. The summary of the legislation includes criticism of the program and the bill includes new oversight requirements. See details later in this post.
- CDBG would be cut by $192.9 million from FY 2011 levels, to a total $3.3 billion of which $400 million can be used for eligible disaster recovery activities.
- Public housing would receive $1.85 billion for the capital fund and $3.96 billion for the operating fund, but the operating figure includes $750 million against PHA reserves.
- Section 202 Housing for the Elderly, which would drop to $375 million from $399 million in FY 2011
There are a few bright spots in the HUD budget provisions of H.R. 2112:
- Choice Neighborhoods would receive $120 million to revitalize distressed communities
- Section 811 Housing for the Disabled would receive $165 million, a slight increase from FY 2011 though below historical levels for the program.
- HUD·s housing counseling program, which was zeroed out in FY 2011, would receive $45 million, still far below the $87.5 million it received in FY 2010. The National Foreclosure Mitigation Counseling (NFMC) program received $80 million.
- $1.901 billion for homeless assistance grants, the same as FY 2011: FY 2012 funding includes at least $250 million for the Emergency Solutions Grants (ESG) program and $1.59 billion for Continuum of Care and rural housing stability assistance programs.
The conference report on H.R. 2112 includes the additional oversight provisions for the HOME program:
- Repayment of funding provided in the bill for developments that are not completed within four years of their commitment dates, as determined by a signature of each party to the agreements. HU D can extend the deadline for one year if the delay is beyond the control of the participating jurisdiction (PJ).
- No program funds can be committed to developments unless the PJ certifies that it has conducted an undeJWriting review, assessed developer capacity and fiscal soundness, and examined neighborhood market conditions to ensure adequate need for each development.
- Any homeownership unit funded with HOME money from H.R. 2112 which cannot be sold within six months of completion must be rented to an eligible tenant.
- No funds may be awarded for development activities to a community housing development organization (CHDO) that cannot demonstrate that it has staff with demonstrated development experience.
H.R. 2112 includes the following funding levels for the Department of Agriculture (USDA) rural housing programs:
- $900 million for the Section 502 single-family subsidized direct loan program, $219 million less than in FY 2011.
- $24 billion for the Section 502 unsubsidized guaranteed loan program, the same as in FY 2011.
- $64.5 million for the Section 515 rural rental housing program, $5 million less than in FY 2011.
- $130 million for the Section 538 multifamily loan guarantee program, $99 million more than in FY 2011.
- $11 million for the Section 542 rural housing voucher program, $3 million less than in FY 2011.
- $2 million for USDA’s Multifamily Preservation and Revitalization (MPR) program, a rural housing preservation demonstration program, $13 million less than in FY 2011.
H.R. 2112 includes the following funding levels for USDA rural development programs:
- Zero funding for the Rural Micro-entrepreneur Assistance Program (RMAP).
- The Rural Business Enterprise Grants program was cut by 37 percent to roughly $24 million.
- Rural Business and Industry (B&I) loans program was cut by 17 percent, approximately $41 million will be available in FY 2012 for loan guarantees for local and regional food enterprises.
According to the conference committee·s own summary of the legislation, mandatory food and nutrition programs within the Department of Agriculture-including SNAP (formerly Food Stamps) and child nutrition- are funded at $98.6 billion-$2 billion less than the Presidenrs request. This funding will allow all individuals and families who meet the programs· criteria for aid to receive all the benefits available to them, and includes $3 billion in reserve funds in case of unanticipated increases in participation or food price increases.
Key provisions of the transportation budget portions of H.R. 2112 include:
- Zero funding for high-speed rail.
- The Federal Transit Administration is provided a total of $10.608 billion. The New Starts program receives $1.95 billion. New Starts is a key funding source for transit projects across the country, particularly in large metropolitan areas.
- Amtrak receives $466 million for operating and $952 million for capital.
- $500 million for TIGER constitutes a 5.1 percent cut from current levels.
- Traditional highway funding under the Federal Highway Administration is funded slightly below currentlevels, with $39.143 billion.
Home Investment Partnership (HOME) Program Under Attack Again: Take Action Now
lACED just received news from national partner the National Alliance of Community Economic Development Associations (NACEDA). The U.S. House of Representatives Financial Services Committee has scheduled a public hearing on the HOME Investments Partnership (HOME) program next week on November 2. Here’s a link to the hearing notice.
As you can surmise by the hearing name “Fraud in the HUD HOME Program.” the hearing is being orchestrated to show the worst possible side of the program. NACEDA has learned that two ex-convicts who have fraudulently dealt with HOME funds will be testifying.
The timing of this hearing is not coincidental with Congress in the throes of negotiations about deficit reduction. This is the same Financial Services Committee who recommended in a recent letter the elimination of many housing programs. including NeighborWorks America, and deep cuts to the Community Development Block Grant (CDBG) and housing counseling.
This hearing follows the May 2011 Washington Post article on HOME and a previous Financial Services Committee hearing. NACEDA has learned that the U.S. Department of Housing and Urban Development (HUD) believes there will be a follow up article to coincide with the hearing.
NACEDA is recommending letters to the editor in local papers especially if you work in the Districts of Indiana Representatives Donnelly and Carson. both of whom serve on the House Financial Services Committee. Example language is available here for your letter.
To contact your state and federal government officials, follow these links:
More news coming soon!