July 31, 2020

House Advances FY21 Funding Bills

Congress

On July 31, the House passed a six-bill appropriations minibus, H.R. 7617, that funds the departments of Defense, Commerce, Justice, Energy, Treasry Labor, Health and Human Services, Education, Transportation, and Housing and Urban Development. This is the second minibus passed by the House containing fiscal year 2021 (FY21) appropriations bills. On July 24, the House passed a four-bill appropriations minibus, H.R. 7608, that provided funding for the departments of State, Agriculture, Interior, and Veterans Affairs.

The House FY21 THUD legislation, included in the six-bill minibus, would provide $50.6 billion for HUD, an increase of $1.5 billion above the FY20 enacted level and $13.3 billion above President Trump’s 2021 budget request. Many critical affordable housing and community development programs received increases, including HOME Investment Partnerships, Community Development Block Grants (CDBG), and the Section 4 Capacity Building Program. Tenant-Based Rental Assistance and Project-Based Rental Assistance both received allocations that would likely be enough to cover all existing contract renewals.

An in-depth breakdown of FY21 funding levels for housing and community development programs can be found on Enterprise’s updated budget chart. Some highlights include:

Department of Housing and Urban Development

  • $3.5 billion for CDBG, $100 million above the FY20 enacted level (2.9% increase). This program was proposed for elimination in the President’s budget request.
  • $1.7 billion for HOME, $350 million above FY20 (29% increase). This program was proposed for elimination in the President’s budget request.
  • $25.74 for Tenant-Based Rental Assistance, $1.87 billion over FY20 (7.8% increase), and $6.9 billion over the President's FY21 budget request.   
  • $13.1 billion for Project-Based Rental Assistance, $881 million over FY20 (3.8% increase), and $409 million over the President's FY21 budget request. 
  • $4.65 billion for the Public Housing Operating Fund, $101 million above the FY20 enacted level (10.8% increase), and $1.1 billion above the President's FY21 budget request. 
  • $45 million for the Section 4 Capacity Building for Community Development and Affordable Housing program, $9 million above FY20 (25% increase). This program was proposed for elimination in the President’s budget request.

The legislation also prevents the enactment of a number of harmful policy proposals put forth by the Administration, including language that would prevent HUD from implementing a proposed rule to prohibit “mixed-status” families — households whose members have different citizenship and immigration statuses — from living in public and other subsidized housing, as well as proposed changes to the Equal Access Rule, which if put in place would allow shelter providers that lawfully operate as single-sex or sex-segregated facilities to voluntarily establish a policy that could limit admission for people whose gender identity does not match their biological sex. The legislation also stipulates that funds provided to the US Interagency Council on Homelessness must be spent on interventions that include support for evidence-based approaches such as Housing First and Permanent Supportive Housing. During floor consideration of the bill, the House attached dozens of amendments, including two introduced by Representative Alexandria Ocasio-Cortez (D-NY-14) that would stop the implementation of HUD’s latest disparate impact rule and prohibit the use of funds for HUD’s implementation, enforcement, or administration of the “Preserving Community and Neighborhood Choice”rule.This rule ends the Affirmatively Furthering Fair Housing mandate under the Fair Housing Act of 1968.

Supplemental Infrastructure Investments 

The bill also includes a separate emergency supplemental infrastructure section to help spark economic recovery from the effects of the Covid-19 pandemic. This supplemental provides robust funding for a number of affordable housing and community development programs, including: 

  • $24.25 billion for the Public Housing Capital Fund
  • $17.5 billion for the HOME Investment Partnerships program
  • $4 billion for Community Development Block Grants
  • $1 billion for Native American programs
  • $750 million for capital improvements for properties receiving project-based rental assistance
  • $750 million for Section 202 Housing for the Elderly
  • $300 million for the CHOICE Neighborhoods Initiative
  • $179 million for Section 811 Housing for Persons with Disabilities
  • $40 million for the Section 4 Capacity Building for Community Development and Affordable Housing program

USDA

For the fourth year in a row, lawmakers rejected the drastic cuts proposed in the President’s budget request and overall provided strong funding levels for affordable housing priorities. The FY21 Ag bill provides $23.98 billion in discretionary funding for rural development and infrastructure, food and nutrition programs, and other food assistance programs. While this topline number represents a slight increase of $487 million above the FY20 enacted level, if the bill is enacted as-is, most rural housing service programs would remain at FY20 funding levels. 

The bill allocates $24 billion for the Section 502 Single Family Housing Guaranteed Loan Program, $1 billion in direct single-family housing loans for low-income rural families, and $40 million for the Section 515 Rural Rental Housing program. Each of these allocations are equal to FY20 enacted levels. 

The bill did provide some increases however, allocating $1.45 billion to the Section 521 Rural Rental Assistance program for rental vouchers and all existing rental assistance contracts for the elderly and low-income families in rural communities. This represents a slight increase over the $1.375 billion allocated to the program in FY20. The House also proposes increasing the Housing Demonstration Preservation Program under the Multifamily Housing Revitalization Program to $30 million, an increase of $2 million over FY20. 

Treasury

The House FSGG appropriations subcommittee included $273.5 million for Community Development Financial Institutions in their FY21 bill. This represents an increase of $11.5 million above the FY20 enacted level and rejects the President’s budget proposal to eliminate the program entirely. The legislation also sets aside $10 million to increase the availability and affordability of small-dollar loans.

Next Steps

The Senate has yet to schedule markupss for their related bills. Enterprise applauds the House for thier support for these critical programs, and encourages the Senate to also provide robust funding for affordable housing and community development programs in FY21, as well as in future Covid-19 relief legislation. 

For more information on the FY21 appropriations process and Covid-19 relief, subscribe to Today in Housing, Enterprise’s daily email providing a quick overview of affordable housing and community development news, and Capitol Express, our more in-depth biweekly newsletter.

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