February 14, 2020

President Trump Releases FY21 Budget Request

On February 10, the White House released a $4.8 trillion budget request that outlines spending priorities for Fiscal Year (FY) 2021. Similar to this Administration's past proposals, this budget seeks cuts to many critical housing and community development programs across agencies.

Overall, the request calls for HUD to be funded at $47.9 billion, a 15 percent decrease in funding from the Fiscal Year FY20 enacted level.

Reducing or Eliminating Key Programs

The budget request proposes eliminating many key programs, including:

  • Community Development Block Grant Program
  • HOME Investment Partnership Program
  • Self-Help and Assisted Homeownership Opportunity Program account
  • Public Housing Capital Fund
  • Choice Neighborhoods initiative

The administration also proposed eliminating allocations to the National Housing Trust Fund and the Capital Magnet Fund. 

The proposed budget also calls for reductions in other key housing programs. The Tenant Based Rental Assistance (TBRA) program would receive $18.833 billion, down more than $5 billion from the amount provided in FY20. The Housing Opportunities for Person with AIDS (HOPWA) program would be funded at $330 million in FY21, a reduction of $80 million. The budget would also cut funding for the Native American Housing Block Grant program by more than $40 million when compared to FY20. 

Small Increases to Select Programs

The White House did propose a series of small increases to certain programs. It provided a bump in funding for the Office of Lead Hazard Control and Healthy Homes, bringing their total budget up to $360 million, an increase of $70 million from FY20. The Section 202 Elderly Housing Program would be funded at $853 million an increase of $60 million from FY 20 and the Section 811 Housing for Persons with Disabilities Program would see an increase of $50 million from FY20.

The Project-Based Rental Assistance (PBRA) program would receive a $72 million increase from FY20 under the President’s proposal, although it’s unclear at this point whether that would be sufficient to renew all existing contracts. The budget includes provisions from the draft legislation “Make Affordable Housing Work Act” proposed by the Administration in 2018. They claim the proposed changes would reduce the cost in rental assistance programs, including PBRA, by increasing tenant contribution towards rent from 30 percent of adjusted income to 35 percent of gross income. Additionally, they would seek to mandate a minimum monthly rent of $50, among other changes. 

Affordable housing and community development programs outside of HUD were targeted as well. Despite a slight overall increase in funding for the Treasury Department, the budget calls for the elimination of the Community Development Financial Institutions (CDFI) Fund. Within the Department of Agriculture’s Rural Housing Services, the budget provides no funding for Section 515 Multi-family Housing Direct Loans. The Budget would also eliminate funding for Section 504 Rural Housing Assistance Grants and Loans, Section 514/516 Farmworker Housing Loans and Grants, and Section 523 Mutual and Self-Help Housing. 

Slashing Important Resources

In all, the proposal would slash important resources and reduce significantly the capacity of federal, state, and local jurisdictions to provide affordable housing and community revitalization to communities, that are increasingly in need of housing support. The elimination or cutting of these important programs would put access to affordable housing even further out of reach for many American families. 

It is important to note that the president’s request serves as a vehicle to communicate the administration’s priorities for FY21 to Congress and is non-binding. In the past three years, lawmakers have mostly rejected the proposals. Enterprise urges Congressional leaders to negotiate a bipartisan deal that fully funds affordable housing and community development programs in FY21.

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