Real Estate

Trump budget proposal would decimate HUD funding


The proposal is more extreme than last year’s budget, but like last year’s, this budget is unlikely to pass

On the heels of a sweeping budget agreement Trump signed into law last week, the Trump administration released its budget proposal for fiscal year 2019 on Monday. The plan is just as austere as last year’s on measures related to housing and transportation.

The Department of Housing and Urban Development (HUD) and the Department of Transportation (DOT) both saw their budgets slashed by billions of dollars, with many of the cuts on HUD’s side affecting programs that aid low-income families.

While the president’s budget has alarmed affordable housing advocates, experts believe it has little chance of passing as is. The president’s similar budget last year was never brought to vote. Instead, a series of continuing resolutions kept the government funded until the brief shutdown last month and the budget deal from last week.

“The breadth and depth of cruelty reflected in this budget proposal is breathtaking,” said Diane Yentel, president and CEO of the National Low Income Housing Coalition, in a statement. “President Trump is making clear, in no uncertain terms, his willingness to increase evictions and homelessness—for the families who could lose their rental assistance through severe funding cuts, and for the low income and vulnerable seniors, people with disabilities, and families with kids who will be unable to manage having to spend more of their very limited income to cover rent hikes.”

The budget deal Congress struck last week will fund the government until March 2019 and lifts spending caps to $300 billion in spending over the next two years. The president’s new requests will now go to various Congressional committees for deliberation.

In the proposal, the administration requests a total Department of Housing and Urban Development (HUD) budget of $39.2 billion, a cut of $8.8 billion, or 18.3 percent, from current spending levels. However, an addendum to the budget in light of last week’s congressional deal increased HUD’s proposed budget by $2 billion, half of which would go to avoid previously proposed rent increases on the elderly and people with disabilities who depend on rental assistance from HUD.

The proposal would eliminate numerous popular block grant programs in their entirety, including Community Development Block Grants (CDBG), which are allocated to local governments to use at their discretion in a wide variety of community development and infrastructure projects.

The HOME Investment Partnerships Program, a block grant program designed to aid affordable housing efforts, is eliminated entirely, citing an “outdated” allocation formula. The Public Housing Capital Fund, which is used to rehabilitate public housing units, is also eliminated. Other eliminated programs include the Self-help Homeownership Opportunity Program, the Native Hawaiian Housing Block Grant, and the Choice Neighborhood Initiative.

The budget’s request for $33.8 billion for rental assistance programs represents a 11.2 percent cut to people who receive aid in the form of housing vouchers and public housing, although the addendum restored $700 million of the cut. The budget also restated the administration’s desire for legislation that permits the use of work requirements for those receiving assistance under these programs.

The administration’s rationale for many cuts is often “fiscal responsibility” or a desire to shift the onus to state and local governments, even in programs that are already largely administered by state and local governments. In some cases, the budget hopes to make up for cuts with private sector investment.
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