House FY11 Budget Bill Slashes and Burns Federal Housing Safety Net

The House of Representatives is expected to vote on its FY11 spending bill, H.R. 1, this week. The bill would cause devastating reductions to non-defense discretionary programs and cut more than $5.7 billion from HUD programs compared to the FY10-enacted level of about $43.5 billion. In addition, the bill would make more than $394 million in rescissions from unobligated balances in HUD programs.

The vote on these proposed cuts comes just two weeks after the release of HUD's report to Congress, Worst Case Needs 2009, which shows an historic increase in the number of families most susceptible to becoming homeless.

"Passage of this bill would mean grave consequences for the most vulnerable people in our communities. It is clear that House Republicans have willfully ignored the needs of their constituents with this legislation," said Sheila Crowley, President and CEO of the National Low Income Housing Coalition. "How will communities take care of the housing needs of their disabled residents when more than two thirds of the funding to do so disappears? How will public housing agencies provide safe, decent homes for the lowest income families when their funds are cut more than 40%? House Republicans give us no answers, just more brutal cuts."

Advocates' outrage is fueled by the depth of the proposed cuts. The public housing capital fund would receive a devastating reduction. H.R. 1 would cut this fund by $1.072 billion, or more than 40%. This massive cut affects those who are the most vulnerable in American society: The average national annual income for a public housing household is $13,400; more than half of public housing families are elderly, disabled or both; and more than 40% of public housing households include children.

The bill would not provide any increases for HUD's homeless assistance programs, a move that would force current programs to make cuts to existing programs in FY11.

"Those who are looking for a thoughtful approach to deficit reduction will not find it in this bill," said Ms. Crowley. "House leaders could have assessed the tax system, entitlements and efficiencies to find ways to balance the budget, but did not. Since the House's FY11 bill does not propose an alternative federal housing safety net for America's most vulnerable families, many of whom will surely become homeless because of these draconian cuts, we can only surmise the true intent of this bill was the decimation of programs critical to people in the greatest need."

Other cuts to housing and related programs proposed in H.R. 1 are as follows:

* Section 202 housing for the elderly and Section 811 housing for persons with disabilities would be cut by $551 million (from $825 million) and $210 million (from $300 million), respectively, and none of their remaining FY11 funds could be spent for capital advances or related tenant-based rental assistance contracts.

* The Community Development Fund would be cut $2.95 billion from $4.45 billion in FY10 spending, the vast majority of which went to community development block grants.

* Funding for the Sustainable Communities Initiative, housing counseling, Native Hawaiian housing block grants, Brownfields, and the Energy Innovation Fund would be eliminated.

* USDA Rural Development programs would be cut by almost $500 million, FEMA's Emergency Food and Shelter grants would be cut by 50%, Department of Health and Human Services' community health centers would be cut by 46%, Community Service Block Grants would be cut by 46%, and Low Income Home Energy Assistance Program would be cut by 66%.

The National Low Income Housing Coalition is urging the House to reject this proposal.