May 23, 2017

President's FY18 Budget Proposes Severe Cuts to Critical Housing Programs

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President's FY18 Budget

The Trump administration’s fiscal year (FY) 2018 Budget Request, A New Foundation for American Greatness, proposes dramatic cuts to housing and community development programs. If enacted, these proposals would place hundreds of thousands of families at risk of homelessness and reduce access to better work, transit, education, and health care options for many more. These proposals come at a time when more and more Americans are struggling to afford a place to call home.

The budget proposes eliminating funding for effective programs that have broad support, including the HOME Investment Partnerships Program (HOME), Community Development Block Grants Program (CDBG), the Choice Neighborhoods Initiative, and the Section 4 Capacity Building for Affordable Housing and Community Development Program (Section 4). As governors and mayors around the country attest, CDBG provides flexible funding for public services and community infrastructure improvements that would not occur otherwise; similarly, the HOME Program is the only federal block grant that provides flexible funding to state and local governments to produce housing affordable for low-income families. For years, these programs have proven to be effective and efficient, with CDBG leveraging $3.65 in other funding for every federal dollar invested, HOME leveraging $4.87 for every federal dollar, and Section 4 leveraging over $20 for every federal dollar. Enterprise calls on the administration and Congress to increase or at the very least maintain investment in these programs that work.

In addition, the budget request calls for cutting funding for Housing Choice Vouchers by nearly $1 billion and Project-Based Rental Assistance by $465 million. The Public Housing Operating Fund would shrink by $500 million, while the Public Housing Capital Fund would be reduced $1.31 billion. Related policy proposals include increasing tenant rent contributions for public housing to 35 percent of a family’s monthly income and eliminating utility allowance reimbursements – meaning it would not only serve fewer families, but also provide those families with less assistance.  The request also proposes cutting funding for Homeless Assistance Grants, Housing Opportunities for Persons with AIDS (HOPWA) and Housing for Persons with Disabilities. The Trump administration also proposes eliminating the Housing Trust Fund (HTF), which has the sole focus of creating housing for extremely low-income households.

Enterprise appreciates the administration’s support for the Rental Assistance Demonstration (RAD), including proposals to lift the cap on the number of public housing units that can participate in RAD and to make Section 202 Housing for the Elderly units eligible for participation as well. However, the ability to successfully convert public housing onto more stable footing through RAD requires fully funding Section 8 – which the budget proposal would significantly cut.

The Community Development Financial Institutions (CDFI) Fund, which plays an important role in generating economic growth and opportunity in some of our nation’s most distressed communities, would also lose more than 90 percent of its funding, from $234 million to only $14 million. Funding for the Neighborhood Reinvestment Corporation (NeighborWorks), a congressionally chartered, nonpartisan nonprofit that has created places of opportunity in communities across the country for nearly 40 years, would be cut by $112 million below FY17 levels to $27.4 million, which would be used to prepare for permanently closing the organization.

Funding for the Rural Housing Service at the US Department of Agriculture would also see major cuts. Section 523 Rental Assistance would be cut by $55 million and funding for Single Family Direct Loans, Rural Housing Repair Loans, Farm Labor Housing Loans, and Section 515 Multifamily Rental Housing Direct Loans would all be eliminated.

The result of these proposals, if enacted, would be devastating: hundreds of thousands of families would be put at risk of homelessness and efforts to expand the supply of safe and affordable homes would be seriously damaged in every congressional district in the country.

While Republicans and Democrats in Congress have largely rejected the administration’s calls for extreme cuts to domestic programs, the President’s request still influences Congress’ eventual spending bills. Members of Congress need to hear from affordable housing stakeholders about how important federal investments in housing and community development are to your community. 

Enterprise believes that a safe and stable home connected to resources like health care, schools, jobs and transportation is the foundation for a successful life. Federal investments in housing leverage private and local investments at a rate greater than three to one, transforming communities and the lives of the people there.  Help us persuade Congress to reject the ideas in the President’s Budget Request – they would harm millions of Americans and their communities.

We urge you to take action now.

  • Reach out to your members of Congress. You can find your Representatives’ and Senators’ housing staffer's contact information on Enterprise’s blog.
  • Invite your members and their staff to a housing development so they can see the impact these homes have. This is the single most effective way to turn an interested member into a supporter and a supporter into a champion for our issues.
  • Write an op-ed in your local paper.
  • Register for the Campaign for Housing and Community Development Funding (CHCDF) webinar: President Trump Proposes Massive Budget Cuts to Critical HUD and USDA Resources
  • Sign the HOME Coalition’s Sign On Letter for organizations, local governments, and businesses in support of restoring funding for HOME to $1.2 billion.

For more information on the President’s FY18 Budget Request, see Enterprise’s updated budget chart, and stay tuned for further analysis and blog posts.