Senate Democrats

The President’s 2009 HUD Budget Shortchanges Americans in Need of Housing

While President Bush often speaks of his commitment to affordable housing opportunities for all Americans, his budget proposals for the Department of Housing and Urban Development (HUD) consistently tell a different story.  For Fiscal Year 2009, the President has once again proposed deep cuts for critical federal housing programs for Americans and communities in need. 

The Bush budget would shortchange lower- and middle- income Americans by:

·       Cutting Funding for Community Development Block Grants.  The Bush budget would gut funding for the Community Development Block Grant (CDBG) program by $659 million below Fiscal Year 2008 levels.  The CDBG program provides eligible areas with annual direct grants that can be used to revitalize neighborhoods, expand affordable housing and economic opportunities, improve community facilities and services, and provide foreclosure avoidance assistance.

·       Under-funding the Section 8 Voucher Renewals.  The Bush budget would woefully under-fund the tenant-based voucher program, cut the Tenant Protection Vouchers by $50 million, and eliminate funding for the non-elderly disabled and Family Unification Program vouchers.  Together, these programs ensure that more than two-million lower-income American families have a safe and affordable roof over their heads.  Inadequately funding these key programs will result in the loss of housing vouchers for thousands of the neediest families.

Moreover, while the President’s budget would increase funding for the Section 8 project-based rental assistance program, HUD’s recent revelation that it did not request enough funding last year — a $2 billion error — has resulted in the current budget request being inadequate to cover voucher renewals.  The project-based program provides rental subsidies to private landlords tied to specific housing units with housing for eligible low-income families.  

·       Undermining the Public Housing Capital Fund.  The Bush budget would cut this fund by $454 million from to 2008 levels.  If adopted, this cut would undermine Public Housing Authorities by hindering their ability to modernize, improve management, finance housing construction, relocate residents, and promote homeownership amongst renters.

·      Cutting funding for disabled and elderly housing programs.  The Bush budget would provide cuts to the Supportive Housing for the Elderly and the Disabled Housing programs, by $208 million and $82 million, respectively, each of which provides for the acquisition, rehabilitation or construction of much-needed housing for their respective populations, which often experience the greatest, most difficult to address, needs.  Moreover, these cuts are particularly irresponsible at a time when elderly Americans on fixed-incomes are disproportionately facing foreclosure on their homes, and are at risk of homelessness, due to predatory lending in the subprime mortgage industry. 

·        Eliminating funding for:

·       HOPE VI.  The Bush budget would provide no funding for Fiscal Year 2009 for the Revitalization of Severely Distressed Public Housing Projects program (HOPE VI), a program that pays for the rehabilitation or replacement of run down public housing projects and is the only significant source of federal money for capital improvements of public housing.

·       Rural housing.  The Bush budget would eliminate funding for Rural Housing and Economic Development programs (RHED). The Administration argues, ironically, that the needs of rural communities are addressed by CDBG — a program it proposes to cut by more than 18 percent.

·       The Brownfields Economic Development Initiative.  The Bush budget would eliminate funding for this program, which promotes economic development in abandoned and under-used industrial and commercial facilities where redevelopment is burdened by environmental contamination. 

·       Community Development Loan Guarantee program.  The Bush budget would also eliminate funding for this program, which provides communities a source of financing for economic development, housing rehabilitation, public facilities, and large-scale physical development projects.

In addition, in the Department of Health and Human Services budget request, the President cut the Low Income Home Energy Assistance Program by $400 million, or 17 percent, below the 2008 level (excluding emergencies) adjusted for inflation.  Like many of his other cuts, this cut could not come at a worst time for Americans who have seen the cost of natural gas, electricity, and home heating oil skyrocket since 2001, when President Bush took office.