The Department of Housing and Urban Development (HUD) will provide more than $31 billion this fiscal year in funding for affordable housing and community development purposes. Approximately two- thirds of the HUD budget goes to provide rental assistance for low-income families, seniors, and the disabled through site-based Section 8 and public housing, and through portable Section 8 vouchers. In addition, over $6 billion is made available to states and localities through flexible block grants for the purposes of affordable housing, community development, housing for persons with AIDS and their families, and emergency shelter for the homeless. The remainder of HUD funds are used for programs such as elderly and disabled housing construction, preventing homelessness, Native American Housing, lead paint reduction, among others.

The U.S. Department of Agriculture, through the Rural Housing Service (RHS), will provide approximately $5.038 billion in FY 2003 in loans and grants for affordable housing in rural areas. Programs include direct loans and loan guarantees for single family and multi-family properties, self-help and farm labor programs, rural rental housing assistance, and repair funds for single family homes and multifamily projects in the RHS inventory.

The Committee’s Democratic Caucus has consistently advocated for increased funding for affordable housing needs and has opposed cuts to affordable housing programs made in recent years. The Caucus opposed Administration efforts to abolish bipartisan, successful programs, including the Public Housing Drug Elimination program (abolished in 2001) and the HOPE VI program to revitalize distressed and obsolete public housing units, which the Administration has targeted for termination in the FY 2004 budget. Committee Democrats have also pushed for adoption of legislative proposals to reform the Section 8 program to increase rates of voucher usage, modernize the HOPE VI program, and raise Federal Housing Administration (FHA) multi-family loan limits. The Caucus is also fighting a proposed HUD regulation that contains provisions rolling back almost 50 years of anti-discrimination laws. The regulation, by which HUD would implement part of the Bush Administration’s faith-based initiative, would allow the agency to issue grants to faith-based institutions that could then use federal tax dollars to practice employment discrimination and to discriminate when offering community services.

Committee Democrats Decry Proposed Faith-based Regulations (click here to view)

Affordable Housing Production and Preservation

The last decade has seen an increased need for affordable rental housing units , as rents have risen dramatically in many local markets and wages, particularly among low-income earners, have been generally stagnant. Committee Democrats have made as a top priority the creation and funding of a program to build additional affordable housing units. Such efforts to expand affordable housing production have been opposed by the Bush Administration, which calls housing a “local issue,” despite the federal government’s critical historical role in providing resources to meet affordable housing challenges.

The need for affordable housing production is magnified by the loss of hundreds of thousands of affordable housing units in the last several years. These losses have resulted from private owners exercising their right to convert HUD- and USDA-subsidized units to non-restricted units with higher rents, and from the demolition of public housing units. Committee Democrats have advocated for more resources for affordable housing preservation, and opposed the repeal of $400 million in preservation funds, cuts that were made with the Administration’s support.

Homeownership

HUD plays a critical role in the area of homeownership, especially with respect to our nation’s mortgage markets. The FHA, an arm of HUD, insures mortgage loans for over 1.1 million borrowers each year, with an emphasis on first-time homebuyers, HUD also regulates the two leading providers of mortgage credit (Fannie Mae and Freddie Mac), regulates the construction of manufactured housing, and operates fair housing programs.

Committee Democrats place a high priority on fighting discrimination and expanding homeownership opportunities for minorities, low-income families, and those living in under-served areas. They support strong fair housing enforcement, the preservation of the Community Reinvestment Act (CRA), reigning in predatory lending activities, and expanding resources for housing counseling. Committee Democrats have developed initiatives to provide assistance to first-time homebuyers, along with efforts to keep families in their home through foreclosure prevention activities and access to funds for critically needed home repairs.