Appropriations
A proposal by the new House Appropriations Committee Chair Jerry Lewis to reduce the number of appropriations subcommittees from 13 to 10 continues to cause friction both in the House and across the Capitol in the Senate. Generally, House Democratic Ranking Members and the Senate Subcommittee Chairs are not excited about the prospect of losing their positions. Among the subcommittees which would be eliminated is VA-HUD. HUD funding would be placed on the same bill as Transportation and Treasury programs. The Senate has been cool to the proposal. It is unclear whether the House committee would reorganize if the Senate did not; such a situation would make negotiations on final numbers even more difficult.
A February 9 press release issued by the Chairman Lewis describes his reorganization plan as follows:
Chairman Lewis announced today a bold reorganization of the House Appropriations Committee in order to streamline and expedite the consideration of the annual appropriations bills. The proposal reorganizes the current 13 subcommittees down to 10. The proposal will need to be ratified by the full membership of the Appropriations Committee at the reorganization meeting tentatively scheduled for Tuesday afternoon. The House and Senate could still modify the plan and those modifications could be accommodated in a manager’s amendment in full committee.
“This structure will allow us to spend less time on the floor and in committee and more time doing oversight over the expenditure of taxpayer funds. These changes will make it a little easier to get our work done on time and under budget. The greatest impact of this proposal falls on the two subcommittees I formerly chaired, VA-HUD and Defense. My decade of experience with the programs funded by these two subcommittees provided the insight to make some common-sense changes that will improve our stewardship of discretionary spending. I want to commend Chairman Cochran on the respectful and thoughtful manner in which he has worked with me on this proposal,” said Chairman Lewis.
Summary of Reorganization Proposal
The functions of the District of Columbia; Legislative; and Veterans, Housing and Independent Agencies will merged into other subcommittees. The House Appropriations Committee will reorganize into 10 subcommittees chaired by the following Members:
- Agriculture chaired by U.S. Rep. Henry Bonilla (R-TX)
- Defense chaired by U.S. Rep. C.W. Bill Young (R-FL)
- Energy and Water chaired by U.S. Rep. David Hobson (R-OH)
- Foreign Operations chaired by U.S. Rep. Jim Kolbe (R-AZ)
- Interior and Environment chaired by U.S. Rep. Charles Taylor (R-NC)
- Homeland Security chaired by U.S. Rep. Harold Rogers (R-KY)
- Labor, Health and Human Services and Education chaired by U.S. Rep. Ralph Regula (R-OH)
- Military Quality of Life and Veterans Affairs chaired by U.S. Rep. James Walsh (R-NY)
- Science, State, Justice and Commerce chaired by U.S. Rep. Frank Wolf (R-VA)
- Transportation, Treasury and Housing chaired by U.S. Rep. Joe Knollenberg (R-MI)
Funding for the District of Columbia will transfer to the Transportation and Treasury Subcommittee. Jurisdiction over Legislative Branch programs will assumed by the Full House Appropriations Committee. The programs and activities of the VA-HUD bill will spread to several existing subcommittees…
For additional information, please see:
https://appropriations.house.gov/index.cfm?FuseAction=PressReleases.Detail&PressRelease_id=439.
2006 Budget
The President sent his 2006 Budget Request to Congress this week. As noted in a previous e-mail to the membership, there were several cuts to important housing programs, including project-based Section 8 and Section 811 housing for the disabled.
Likewise, the President proposed elimination of the Community Development Block Grant (CDBG), a highly popular program from the perspective of state and local government officials. The Administration feels CDBG is redundant, should be consolidated with several other economic development programs, and moved to the Department of Commerce. Funding for the new program is proposed at $3.71 billion; in 2005, CDBG received more than $4 billion. Aside from whether or not CDBG is effective or deserves to be eliminated, the point is that even popular block grants can be targeted for elimination. The irony is that CDBG may become a victim of its own design, and the very factors which made it popular. Because it has so many eligible uses, so much “flexibility” and minimum federal requirements, it is regarded as lacking clear goals and objectives. This is something to keep in mind in considering any proposed Section 8 block grant.
A review of the key affordable housing accounts follows.
HUD
Section 8: As per the 2005 appropriations bill, the accounts for tenant-based and project-based Section 8 are separate.
Tenant-based Housing Choice Vouchers: The Administration announced it will seek separate legislation to give public housing agencies (PHAs) more “flexibility” so they can live within their dollar-based budgets. Unlike last year, the Administration has not incorporated assumptions about cost savings from Section 8 reform as part of the budget. For contract renewals, $14,090,000,000 is requested-an increase of about $1.1 billion above FY 2005.
Project-based Section 8: Cuts are proposed for this side of Section 8. Only $4,923,000,000 is requested for contract renewals; $5,195,000,000 was appropriated for FY 2005. HUD officials explained that much of this $226 million proposed reduction is explained by the HUD’s decision not to seek money its customary 3% cushion above what they think is needed for renewals. HUD claims the RHIPP Initiative has cut subsidy errors by 30%, and combined with the PBCA efforts, HUD expects erroneous payments to be reduced even further, eliminating the need to ask for more money than they believe is necessary.
Section 202: Total funding would be flat-lined at $741 million, same as the 2005 enacted level. HUD believes the same funding level can build more units because they are proposing elimination of the $18 million predevelopment grants. Length of PRACs will be reduced from 5 years to 3.
Section 811: Funding would be cut nearly in half from $238 million to $119 million. No funding for capital advances (i.e. no new construction). Full funding is proposed for the mainstream voucher program. HUD officials mentioned there is controversy within the disabled community about whether project or tenant-based assistance is more appropriate.
HOME: Although total funding through HOME would rise from $1,900,000,000 to 1,941,000,000 under the request, most of this increase is accounted for by raising down payment assistance funds from $50 million to $200 million. Aside from the American Dream Downpayment Act assistance, HOME would be reduced from $1,865,000,000 to $1,741,000,000.
HOPE VI: No new funding is proposed.
FHA Multifamily Mortgage Insurance: Reduced Premiums for Tax Credit properties and ReFis effective in October. All other premiums to remain the same.
CDBG: Will be eliminated & functions consolidated in a new economic development program administered by the Department of Commerce.
RHS
Section 515: $27.027 million, limited to repair and rehab purposes. In 2005, the program received $100 million.
Section 521: $650.026 million is requested for rural rental assistance, a considerable increase above the $592 million provided for FY 2005.
Section 538 Loan Guarantee: Proposed doubling the program to $200 million.
Tenant Protection Vouchers: $214 million is requested to provide tenant-protection vouchers in cases of pre-payment / opt-out.
