Senate Appropriations Committee Approves FY 2018 Housing Spending Bill

On July 25, the Senate Transportation, Housing and Urban Development, and Related Appropriations Subcommittee advanced its FY 2018 Transportation, Housing and Urban Development (THUD) spending bill. The committee voted to approve the bill by a vote of 31 to 0. The bill includes a $1.4 billion increase in funding for HUD over FY 2017. And it sets the stage for a bipartisan budget deal.

The Senate bill rejects President Donald Trump’s proposed budget, which called for a decrease of almost 20 percent over last year and, if enacted, would be the deepest cuts to HUD programs since the Reagan administration. The Senate bill is also in contrast to the House’s current appropriations bill, which calls for a 1.3 percent decrease to HUD’s appropriation.

Subcommittee Chairwoman Susan Collins (R-ME) stated that the bill provides enough funding to continue housing assistance for all individuals currently served by federal housing programs at HUD and, in many cases, provides modest increases. “The bill protects all existing rental assistance for Section 8, public housing, elderly, and disabled housing programs,” Collins said. “In light of the affordable housing crisis afflicting so many parts of our nation, the committee continues to recognize that without this vital assistance, the most vulnerable families would be at risk of becoming homeless.”

Rent policy. The Senate bill rejects the Trump-proposed rent policy changes. The Trump administration had proposed providing the HUD secretary with the authority to increase a tenant’s rent contributions from the currently standard of 30 percent of his adjusted income to 35 percent of gross income; increase the minimum monthly rent for tenants to $50, beginning with a tenant’s first annual or interim authorization; prohibit tenants from receiving utility reimbursements used to cover the cost of heat and water; and freeze annual rent adjustments for properties receiving housing assistance.

Tenant-based rental assistance. The Senate bill provides a significant increase in funding for Housing Choice Vouchers (HCVs). This is in contrast to the budgets proposed by the Trump administration and the House Appropriations Committee. Overall, the Senate bill provides $1 billion in additional funding for HCVs above FY 2017. According to Senator Collins, this amount will be sufficient to renew all existing vouchers.

The Senate bill also provides $40 million for new HUD-Veterans Affairs Supportive Housing (VASH) vouchers and $20 million to support new Family Unification Program (FUP) vouchers, while increasing funding for new vouchers targeted to people with disabilities.

Project-based rental housing. The bill provides $11.5 billion to renew all project-based rental assistance contracts, an increase of $691 million over the FY 2017 funding level. The subcommittee says this is sufficient to renew all existing contracts.

Public housing. The bill provides $6.45 billion for public housing. This is $103.5 million more than was provided in FY 2017. In addition, both the public housing operating and capital funds receive modest increases. The operating fund allocation rose from $4.4 billion in FY 2017 to $4.5 billion, and the capital fund allocation increased to $1.95 billion. The bill also permanently extends the Rental Assistance Demonstration (RAD) by eliminating the program’s sunset date and lifts the cap on housing units eligible for conversion.

Section 202, Section 811. The Senate bill provides $573 million for the Section 202 Housing for the Elderly program, $70.6 million more than in FY 2017, and $147 million for the Section 811 Housing for People with Disabilities program, $1 million more than in FY 2017. The bill also includes legislative language allowing Section 202 Project Rental Assistance Contract (PRAC) properties to convert under RAD.

Fair housing. The Senate bill funds HUD’s Office of Fair Housing and Equal Opportunity and includes language previously offered by Senator Collins to prohibit HUD from directing local and state governments to make specific changes to its zoning laws to comply with the Affirmatively Furthering Fair Housing (AFFH) rule or with the AFFH assessment tool.

Healthy homes. The bill provides $160 million to the Office of Lead Hazard Control and Healthy Homes’ grants, a $15 million increase over FY 2017. The bill also requires HUD to take action against property owners receiving rental subsidies that do not maintain safe properties. The language authorizes the HUD secretary to replace a property’s management agent with one approved by HUD, impose civil monetary penalties, change HUD’s contract with the property owner until problems are resolved, transfer the property or contract to a new owner, and relocate tenants, among other actions.