HUD leadership defends FY18 budget request in House and Senate hearings
Congressional appropriators questioned HUD Secretary Ben Carson this week on the agency’s budget request for fiscal year 2018, which cuts 7.3 billion, or 15%, in HUD funding beginning October 1, 2017. The
House and
Senate Appropriations Subcommittees on Housing, Transportation, and Urban Development (THUD) held hearings that criticized the proposed reductions, but acknowledged both stringent spending caps and limited opportunities for HUD’s new leadership to help craft the Trump Administration’s budget proposal.
The hearings demonstrated broad bipartisan support for the Community Development Block Grant (CDBG) and HOME programs, and top Republican and Democratic appropriators presented unified criticisms of cuts to homeless assistance, housing vouchers, Veterans Affairs Supportive Housing (VASH), Public Housing Operating and Capital funds, and Section 811 Housing for Persons with Disabilities.
“While we need to pursue program reforms and find ways to reduce the share of HUD’s budget that is consumed by rental assistance, merely shifting the costs onto the low-income elderly and disabled households that comprise 57% of the participants in these programs cannot be the answer,” said Senate Subcommittee Chairwoman Susan Collins (R-ME). Senator Jack Reed, the Chairwoman’s democratic counterpart from Rhode Island, pressed Dr. Carson on cuts to homelessness and lead abatement programs.
House appropriators questioned Secretary Carson on the broader budget environment. “We know that we need to get our country’s fiscal house in order,” said THUD Ranking Member David Price, a democrat from North Carolina. “[The Fiscal Year 18 budget request] is destructive in terms of the things a great country must do to build its economy and to build its future. It’s a formula for disinvestment.”
In response to the criticisms, a composed Dr. Carson stressed the importance of fiscal responsibility, evidence-based results, and overall prioritization. “I think the whole ‘housing first’ is a good concept in the sense that if you leave somebody sleeping out under the bridge, they are going to end up in the emergency room and frequently end up getting admitted. A week of admission costs more than a year of shelter,” said the retired neurosurgeon. “We have to look at the numbers and do things wisely for that reason, but I don’t think we should stop at housing first. We should then move on to housing second and housing third. Housing second is diagnosing why they are in that condition, and third is treating it, because if we truly want to be compassionate, then we do everything we can to put people back on their feet.”
Separately, the Senate Banking Committee used a
confirmation hearing to press Pamela Patenaude, HUD Deputy Secretary-designate, on the FY18 Budget. Although the proposed reductions contrast with the nominee’s extensive housing background in both the public and private sector, she stood by the President’s request. With competing priorities, Congress has a limited summer schedule to agree to a budget or pass short-term measures to fund the government by October 1st, 2017.
House approves Dodd-Frank rollback to reform housing finance system
The House this week voted 233-186 to repeal housing finance regulations put in place after the 2008 mortgage collapse. A key milestone for House Financial Services Committee Chairman Jeb Hensarling (R-TX-5), the Financial Choice Act (
H.R. 10) would remove restrictions on bank lending put in place by the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, while also weakening the Consumer Financial Protection Bureau (CFPB), which GOP leadership has criticized as contributing to economic stagnation.
Dubbed the “Wrong Choice Act” by Committee Democrats, Chairman Hensarling’s bill has been the subject of contentious hearings in the House. Following the party line vote, the legislation advances to the Senate Banking Committee, where Committee Chairman Mike Crapo (R-ID) is expected to emphasize bipartisanship in his financial reform efforts.
National Flood Insurance reauthorization bills debated in House Committee
The House Financial Services Committee this week considered a number of draft bills to reform and reauthorize the National Flood Insurance Program (NFIP), which expires at the end of September. Debates in the House have focused on reducing the program’s annual deficit, updating flood maps to accurately reflect risk, and balance risk-based insurance rates with affordability measures. A key concern of Chairman Jeb Hensarling (R-TX-5), who is leading the reform efforts alongside his democratic counterpart, Ranking Member Maxine Waters (D-CA), is the role of the federal government in encouraging private sector competition and innovation in the national program.
The NFIP aims to reduce flood damage to both private and public structures, and uses flood maps to define risk-prone areas. Because flood plain mortgages are federally-required to have flood insurance, a lapse in the NFIP could lead to stalled home sales, while program reforms could affect the real estate market overall.
The House could vote on legislation as early as next week, but a drawn-out debate ahead of the program’s sunset date may be more likely. A Senate version of the bill has yet to be released.
Virginia lawmakers introduce companion bills to improve disaster resilience
Recently, Senators Tim Kaine (D-VA) and Mark Warner (D-VA) recently introduced the
Building Up Infrastructure and Limiting Disasters through Resilience (BUILD Resilience) Act to establish infrastructure grants within HUD. The BUILD Resilience Act (
S. 1224) authorizes HUD to administer $1 billion in annual resiliency investments for housing, roads, and other infrastructure to help communities withstand natural disasters. According to the lawmakers’
press release, post-disaster rebuilding efforts cost three to four times more than preventative investments.
A near identical bill (
HR 2583) introduced to the House by Congressman “Bobby” Scott, also from Virginia, has gained 13 cosponsors, nearly all from coastal areas vulnerable to hurricanes and sea level rise. “Many communities have experienced an increase in extreme weather events, including storm surge, severe flooding, and tropical storms, all of which have severely affected our nation’s infrastructure,” said Representative Scott (D-VA-3), who serves as Ranking Member on the House Education and Workforce Committee.
