Rescission Package introduced to cut Funding from Rural and Public Housing Programs
This week, House congressional leaders introduced the White House’s “rescission package,” a legislative tool that can be used to cut previously allocated funding. The rescission bill, titled the “Spending Cuts to Expired and Unnecessary Programs Act” (
H.R. 3), would cancel more than $15 billion in budget authority previously approved by Congress, including funding for certain affordable housing and community development programs.
If approved by both Chambers of Congress, the rescission bill would roll back $40 million in carry-over balances from USDA’s Section 521 Rural Rental Assistance program, which could have a significant negative impact on properties receiving rental assistance through RHS. The bill also cancels $41 million from HUD’s Public Housing Capital Fund, most of which includes funds appropriated in Fiscal Year 2017 to cover capital repair needs, such as RAD conversions, physical inspections, and grants for the Jobs Plus program.
In addition, the legislation rescinds $151 million from the Capital Magnet Fun (CMF), which would eliminate funds only recently provided by the GSEs for state Housing Finance Agencies (HFAs), Community Development Financial Institutions (CDFIs), and other eligible applicants. Most of the remaining rescission amounts target the Children’s Health Insurance Fund (CHIP), which helps states provide low-cost health insurance for qualifying children and pregnant women.
Congress now has 45 working days to enact the rescission legislation, which by law enjoys procedural benefits to expedite passage. In the meantime, most funds targeted for rescission have been impounded until the legislation is passed or the time window lapses.
While this rescission package did not include funds appropriated through the FY18 Appropriations Act, the White House is said to be considering an additional proposal to undo parts of the recent omnibus. NAHMA opposes the proposed cuts and will keep members up-to-date on the legislative developments.
House Appropriations Subcommittee advances Fiscal Year 2019 Rural Development Funding Bill
This week, the House Appropriations Agriculture Subcommittee approved a bill to fund USDA for Fiscal Year 2019, including Rural Development programs. The bill rejects the President’s FY19 Funding Request, which called for significant cuts to affordable housing and other programs, and instead proposes overall agency funding at levels slightly higher than those enacted in FY18.
The bill proposes sufficient funding to renew RHS contracts, but continues a downward trend in certain Rural Development funding levels. NAHMA views this legislation as a “floor” for fiscal negotiations and is closely monitoring the forthcoming Senate version of the appropriations legislation.
Under the Subcommittee’s bill, Section 515 Rental Housing Direct Loans would be maintained at $40 million; the Section 538 guaranteed multifamily housing loan program would be maintained at $230 million; and the Section 521 Rental Assistance program would be funded at $1.331 billion (slightly lower than the $1.345 billion appropriated in FY18). Section 542 Rural Housing Vouchers and the Preservation Demonstration would each see a $3 million increase over FY18. The bill also directs the USDA Secretary to “implement provisions to provide incentives to nonprofit organizations and public housing authorities to facilitate the acquisition of RHS multifamily housing properties,” including the $7,500 non-profit asset management fee on a per property basis.
“For far too long, Washington has looked at rural America as an expanse in between the cities and their suburbs, as opposed to the backbone of America. Yet, these are the people that raise our cattle, work in the factories that dot rural landscapes, and till the land in order to provide food for our plate. This bill today continues to fulfill the commitment President Trump made to invest in rural America,” Subcommittee Chairman Robert Aderholt (R-AL) said.
“There is more work to be done, but I am pleased with our progress on this important bill. This legislation includes adequate funding for our food safety-net programs and largely avoids reforms that would limit the ability of vulnerable citizens to receive the nutrition they need to survive. It also provides additional support for our rural housing, water and broadband programs,” said Subcommittee Ranking Member Sanford Bishop (D-GA).
To read more about the Subcommittee’s mark-up of the legislation, please click
here. The full House Appropriations Committee will
consider the legislation next week.
