Thursday, February 26, 2015

Appropriations subcommittee hearing on HUD budget highlights challenge of austerity

by Rebekah King, National Housing Conference

Yesterday, the House Appropriations subcommittee on Transportation, Housing and Urban Development held its first hearing on the HUD budget. HUD Secretary Julian Castro shared major points from the President’s FY2016 budget request before taking questions from committee members. Questions were primarily thoughtful and constructive, trying to understand how certain HUD programs work. The most significant comments in the hearing came from the chairman and ranking member in their opening statements.

Subcommittee Chairman Mario Diaz-Balart (R-Fla) reminded the subcommittee of the current budget context.
  • With Budget Control Act caps in place, no federal agency should expect an eight percent increase over FY2015, the president’s proposed funding increase for HUD.
  • HUD’s FY2016 budget, under the BCA caps, is particularly challenging because of a decline in FHA receipts and the need for additional funding this year for project based Section 8 renewals.
Subcommittee Ranking Member David Price (D-N.C.) made several counter points.
  • This proposed HUD budget is still low when compared to previous years.
  • Sequestration was never supposed to happen because of its incredibly damaging outcomes; its existence illustrates a failure to address the factors that are truly driving the federal deficit. 
  • This self-enforced austerity is a disaster and we need a comprehensive budget agreement, or at a minimum, a short-term budget agreement similar to the Murray-Ryan deal. 
  • Without a budget agreement, the burden falls on discretionary programs, making appropriations decisions very challenging.
While the discussion also included other concerns like HUD internal management and the proposed FHA administrative fee, the primary comments clearly indicated the difficult budget environment facing housing and community development programs and the important value HUD programs provide.

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