Housing Choice Vouchers: Funding Outlook and Impact on

Ending Homelessness

Center on Budget and Policy Priorities National Alliance to End Homelessness

September 26, 2013

Center on Budget and Policy Priorities

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Agenda 1) How did we get here? The Budget Control Act and

sequestration 2) What is the impact of recent budget cuts on low-

income families in need of housing assistance? 3) The budget fight continues: How might it play out and

what’s at stake for community efforts to end homelessness?

4) What can advocates do to influence the outcome? 5) Q & A

With Panelists: Barbara Sard and Doug Rice, CBPP Steve Berg and Kate Seif, National Alliance to End Homelessness

Center on Budget and Policy Priorities

1. Set binding caps on “discretionary” spending in each fiscal year from 2012 to 2021, with separate sub-caps for defense and non-defense programs.

2. Triggered “sequestration” when Congress failed to agree on at least $1.2 trillion more in deficit reduction. Requires (i) automatic, across-the-board cuts in non-exempt entitlement and discretionary programs in FY 2013, and (ii) cuts in FY 2014 – 2021, including by lowering the defense and nondefense discretionary spending caps.

The Budget Control Act of 2011 (BCA)

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Deficit Reduction Enacted Since 2010, Excluding Sequestration

$1.6 trillion in program cuts (mostly BCA discretionary spending caps) $0.7 trillion in revenues (“fiscal cliff” deal) $0.5 trillion in interest savings $2.8 trillion in total deficit reduction enacted

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Nondefense Discretionary Program Spending Will Fall to Lowest Level on Record Under BCA Caps

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Percent cut in HUD housing assistance program funding, relative to 2010, adjusted for inflation

Note: Sources are OMB and CBO data. Figures include discretionary HUD program funding for public housing, the Section 8 programs, homeless assistance, HOME, and smaller housing assistance programs, but not mortgage credit or community development programs.

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Three Waves of HUD Housing Assistance Cuts Since 2010

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cbpp.org Source: CBPP analysis of HUD data.

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Sequestration Is Causing Deep Cuts in the Number of Families Using Housing Vouchers

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Budget Decision Timeline • Federal fiscal year 2014 begins on October 1 • To avoid a “shutdown” – and give itself time to

negotiate a budget/debt ceiling deal – Congress will try to approve a “continuing resolution” (CR) to fund programs into Nov/Dec at FY 2013, post-sequestration levels

• Federal government could hit the statutory debt limit in mid-October; to avoid default, Congress must act to raise/suspend the limit

• House may pass debt ceiling bill this week

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How Might This Play Out for FY 2014? • Congress’ goal is a budget deal that raises the debt ceiling,

sets overall discretionary funding levels for FY 2014, and possibly modifies sequestration. But House and Senate far apart on these and other budget and policy issues that will be brought into play

• Opportunity: Good deal could reduce or eliminate sequestration cuts – opening path for Congress to complete omnibus for FY 2014

• Risk: Bad deal could replace sequestration with other cuts in entitlement safety net or NDD programs

• Default option is full-year CR, with no changes in sequestration or discretionary funding caps; may include “anomalies” (i.e., funding adjustments)

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What Happens to Discretionary Funding in FY 2014 Under the BCA Spending Caps?

Table 1 2014 Discretionary Levels (billions of dollars)

Freeze at 2013 level after sequestration (CR)

Budget Control Act cap before sequestration

Budget Control Act cap after sequestration

Defense 518 552 498 Nondefense 468 506 469 Total 986 1058 967 Source: Joel Friedman et al., “Clearing Up Misunderstandings: Sequestration Would Not Be Tougher on Defense Than Non-Defense Programs in 2014,” Center on Budget and Policy Priorities, September 18, 2013, http://www.cbpp.org/cms/index.cfm?fa=view&id=4019.

• For nondefense category, post-sequestration funding in 2014 is roughly level with 2013

• For defense, post-sequestration funding in 2014 is ~$20 billion below the 2013 level, mostly because “fiscal cliff” deal reduced sequestration in 2013

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Range of Possible Funding Levels for HUD Programs in FY 2014? (Millions of dollars)

2012

2014 under CR

(same as 2013)

2014 sample

omnibus (Senate)

Housing Choice Voucher Renewals *$17,242 $16,349 $17,568

Housing Choice Voucher Admin $1,350 $1,306 $1,685

Public Housing Operating $3,962 $4,054 $4,600

Public Housing Capital $1,875 $1,777 $2,000

Section 8 Project-Based Rental Asst. $9,340 $8,851 $10,700

Homeless Assistance $1,901 $1,933 $2,260

HOME $1,000 $948 $1,000

Section 202 Elderly Housing $375 $355 $400

Section 811 People with Disabilities $165 $156 $126

Native American Housing Grants $650 $616 $675

CDBG Formula Grants $2,948 $3,078 $3,150 * Figure includes reserve offset amount.

What’s at stake for ending homelessness?

• Under the law, ¾ of Section 8 voucher admissions must have extremely low incomes, i.e., people who are homeless or at severe risk of homelessness

• HUD-VASH – exempt from sequestration but not exempt from discretionary caps

• FUP vouchers • Nonelderly disabled (NED) vouchers

What’s at stake for ending homelessness?

Data suggest that people who lose a housing subsidy are at high risk for homelessness

What’s at stake for ending homelessness?

In some communities, Section 8 turnover has been targeted by campaigns to end homelessness for those with severe problems for whom rapid re-housing may not work. • HUD 10-city initiative with PHAs • 100,000 Homes campaign

What’s at stake for ending homelessness?

A Section 8 voucher is, for the vast majority of low-income people, a solid bulwark against homelessness. Section 8 vouchers may also be “project-based” for the development of permanent supportive housing for people who need services to remain stably housed.

Impacting the Outcome

• Decisions are still being made about sequestration and funding

for FY 2014 and beyond

– It’s essential to remind Members about the importance of these

programs

• Section 8 vouchers do impact homelessness

– Must make sure Congress knows this!

• Messaging

– HUD needs more money to maintain existing activities, hold the line

on homelessness, and continue operating programs that work

What You Can Do

• Make calls! Write letters!

– Use Alliance and CBPP materials to assist you

• Keep getting the message out about the need for

increased HUD funding

• Both immediate and long-term advocacy effort

– Efforts have been successful, we need to keep them up!

• Remind Members not to balance the budget on the backs of our

nation’s poorest people!

More Information/Resources Kate Seif, Policy Outreach Coordinator

cseif@naeh.org / 202.942.8256

http://www.endhomelessness.org/pages/advocacy

How S8 Impacts Homelessness:

http://www.endhomelessness.org/library/entry/section-8-

housing-the-lowest-income-families

Talking Points:

http://www.endhomelessness.org/library/entry/funding-for-

section-8-housing-choice-voucher-program-congressional-

talking

Center on Budget and Policy Priorities

cbpp.org

Useful CBPP Resources • Report on sequestration and House/Senate FY 2014

HUD funding bills, including state-by-state data on impact of funding cuts in major HUD programs, 2010 – 2013: http://www.cbpp.org/cms/index.cfm?fa=view&id=3993

• State-by-state data on HUD rental assistance programs, the families they serve, and unmet needs: http://www.cbpp.org/cms/index.cfm?fa=view&id=3586

• Lots of info on issues related to the broader budget fight: http://www.cbpp.org/research/index.cfm?fa=topic&id=29

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Q & A

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