The Trump Administration on Thursday released a budget outline for the 2018 fiscal year, proposing $6.2 billion in cuts to the Department of Housing and Urban Development (HUD), or a 13.2 percent reduction. Funding for the agency would total $40.7 billion, with $35 billion allocated to rental assistance programs, $130 million to lead-based paint mitigation in low-income housing, and $4.5 million to low-income housing assistance.
“This budget reflects the President’s commitment to fiscal responsibility while supporting critical functions that provide rental assistance to low-income and vulnerable households and help work-eligible families achieve self-sufficiency,” the outline states. “The budget also recognizes a greater role for state and local governments and the private sector to address community and economic development needs.”
The budget eliminates funding for Community Development Block Grants, a long-running program providing resources to communities in need of aid in areas such as affordable housing, disaster recovery and foreclosure rehabilitation. The elimination of the program would save $3 billion.
“The program is not well-targeted to the poorest populations and has not demonstrated results,” the outline states. “The Budget devolves community and economic development activities to the state and local level, and redirects federal resources to other activities.”
The budget also eliminates funding for the Choice Neighborhoods program, which replaces distressed public housing with mixed-income housing, among other initiatives; the HOME Investment Partnerships Program, which assists communities with affordable housing development; and the Self-Help Homeownership Opportunity Program (SHOP), which awards grants to nonprofits for low-income housing development. The elimination of the programs would save $1.1 billion.
“State and local governments are better positioned to serve their communities based on local needs and priorities,” the outline states.
The budget, in addition, eliminates funding for Section 4 Capacity Building for Community Development and Affordable Housing, saving $35 billion.
The outline briefly addresses insurance premiums for Federal Housing Administration-backed mortgages, stating it “supports homeownership through provision of Federal Housing Administration mortgage insurance programs.” The Trump Administration suspended a reduction to premiums issued in January.
HUD elaborated on that provision, stating “The spending plan supports the longstanding homeownership mission of the Federal Housing Administration (FHA) to provide mortgage insurance credit to qualified households. A more detailed program-by-program budget proposal will be announced in May.”
“If enacted, Trump’s proposed budget would result in the most severe cut to HUD since President Reagan dramatically reduced funding in the early 1980s,” said Diane Yentel, president and CEO of the National Low Income Housing Coalition (NLIHC), in a statement.
“These budget cuts would have a devastating impact on millions of the lowest income people across the country,” Yentel said. “More than 200,000 seniors, families, and people with disabilities will be at immediate risk of evictions and homelessness, and local communities will be starved of the funding they need to build and repair affordable homes and revitalize distressed communities.”
The budget, if approved, would take effect October 1.
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