President Trump signs $1.4 Trillion Spending Deal
On December 20, President Trump signed a $1.4 trillion spending deal for fiscal year 2020 (FY20), averting a government shutdown.
Prior to receiving the President's signature, the FY20 deal was passed in each chamber in the form of two minibus bills – H.R. 1865 and H.R. 1158. H.R. 1865 provides funding for domestic agencies and priorities, including HUD and USDA. H.R. 1158 includes funding for national security priorities at the Departments of Defense and Homeland Security, but also covers additional departments such as Treasury (funded through the Financial Services and General Government -- or FSGG -- subcommittee on appropriations). Together, the bills will boost defense and domestic budgets by $49 billion in FY20 and fund the federal government through next September.
There are a number of critical affordable housing and community development programs funded in both bills, particularly the subsections that include HUD, USDA, and FSGG. Enterprise commends lawmakers for generally providing strong funding levels for these priorities.
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
The FY20 appropriations legislation provides $49.1 billion for HUD, which is an increase of $4.9 billion above the FY19 enacted level. Many programs at the department will see increased funding levels in FY20 compared to FY19.
One of those programs that saw a bump was the HOME Investment Partnership program, which received $1.35 billion, $100 million (8%) over FY19. The Community Development Block Grant also saw a $100 million (3%) increase from its 2019 funding level, landing it at $3.4 billion. The Section 4 Capacity Building for Affordable Housing and Community Development program received $36 million, $1 million over FY19. This is the first increase the program has seen since 2011.
The bill also includes $23.874 billion for Tenant-Based Rental Assistance and $12.57 billion for Project-Based Rental Assistance, which is anticipated to be enough to renew all existing contracts.
The Public Housing Capital fund received an increase to $2.87 billion, 3% and $950 million over FY19, but the Public Housing Operating fund saw a decrease from its 2019 allocation, down 2% from $4.65 billion to $4.55 billion.
The bill also takes steps to ensure that HUD releases mitigation funds to Puerto Rico. The measure includes language to withhold funding for the Office of the CFO for its financial transformation initiative until all mitigation allocations made available under CDBG-DR for Puerto Rico have been published. This step was taken after HUD missed the September 4th deadline set by Congress to submit a Federal Register Notice for Puerto Rico’s appropriated mitigation money.
USDA RURAL HOUSING SERVICE
USDA’s Multifamily Housing Revitalization program received $28 million for its Housing Demonstration Preservation program in FY20, an increase of $3.5 million (14%) over last year. Section 521 Rental Assistance was increased by 3% to $1.375 billion, and USDA will now be able to renew those rental assistance contracts for 20 year terms. Finally, the Section 502 Single-Family Direct Loan program and the Section 515 Multifamily Direct Loan program received funding even with FY19 levels.
DEPARTMENT OF TREASURY
H.R. 1158 provides $262 million for the Community Development Financial Institution Fund, an increase of $12 million (5%) over FY19 levels.
NEW MARKETS TAX CREDIT
In addition to FY20 spending allocations, the legislation also includes a $426 billion year-end tax package. Notably, the tax portion includes a provision to extend the New Markets Tax Credit program (NMTC) through 2020 and increases its allocation from $3.5 billion to $5 billion. More information on the tax package can be found here.
For a full rundown of FY20 spending levels for affordable housing and community development programs, see our updated budget chart.
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