Last night, Congressional leaders released the draft of their $1.3 trillion omnibus spending package for FY18. Prosperity Indiana engaged Congressional offices in our delegation to advocate for robust community development program appropriations and program updates and we are pleased to share the following summary of the progress made towards those goals in this bill:
What is an omnibus bill?
Previous to this deal, the government has been funded under a series of continuing resolutions, or CR’s. The difference between a CR and an omnibus agreement is that under a CR, existing programs receive static funding and it is intended to fund programs for a short period of time. With an omnibus bill, the budget bills from each of the Appropriations Committees are combined into one bill and legislators may adjust programs and funding levels as they see fit. Upon passage, this bill will fund programs through the end of FY18 (Sept. 30).
Key Prosperity Indiana Member wins:
Overall, the bill contains nearly $700 billion defense spending and $591 billion for nondefense budgets. The legislation provides a 10% increase for HUD funding overall for this year- $4.6 billion above FY17 levels and significantly higher than any of the budget proposals from Congress or the Administration. The bill also includes key program improvements for the Low Income Housing Tax Credit, Rental Assistance Demonstration program.
The bill contains funding to renew all Housing Choice Vouchers and provides new vouchers to veterans and people with disabilities. It provides nearly $1 billion in additional funding to repair and operate public housing, and significantly increases funding for Homeless Assistance Grants, Community Development Block Grants and the HOME Investment Partnerships program (HOME). Additionally, the bill does not the HUD tenant rental increases proposed in the Administration’s budget request. Within Treasury, the bill rejected the Administration’s proposal to eliminate Community Development Financial Institutions (CDFI) Fund grant funds, another critical win for Prosperity Indiana Members.
There were some setbacks, such as language pertaining to fair housing rules and a decrease in USDA rental assistance (described below), but overall, this is a package with great wins for our advocacy goals. Please contact Kathleen Lara at klara@prosperityindiana.org with any questions.
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Program
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Funding Level/Key Changes
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Low Income Housing Tax Credit (LIHTC) Program
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Prosperity Indiana advocated for the inclusion of reforms to strengthen the LIHTC program contained within H.R. 1661/S. 548 (Click here for bill summaries) in the omnibus
What was included in this bill:
- · a 12.5% increase in the Credit allocation for four years (2018-2021)
- · Income averaging, on a permanent basis after enactment of this bill, which would allow the 60 percent AMI ceiling to apply to the average of all apartments in a project rather than each individual apartment. That increases the ability of the tax credit to reach the lowest income households.
The bill, unfortunately, does not include a fixed 4% rate or some of the other improvements we sought to include, but getting the improvements we did is significant progress. As it stands, the revisions included should help offset the impact of the lowered corporate tax rate which reduces the value of Housing Credits to corporate investors.
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Community Development Block Grant (CDBG)
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$3.24 billion (7.8% increase)
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HOME Investment Partnerships Program (HOME)
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1.36 billion (43.4% increase) The highest funding level in seven years!
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McKinney-Vento Homeless Assistance Grants
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$2.51 billion (5.5% increase) This includes a $2.11 billion set-aside for the CoC and rural housing stability assistance programs, and $270 million for ESG.
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Public Housing Operating Fund
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$4.55 billion (3% increase)
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Public Housing Capital Fund
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$2.75 billion (41.6% increase)
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Rental Assistance Demonstration (RAD)
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Under RAD, public housing agencies are able to leverage public and private debt and equity to fix public housing stock. The bill increases the unit authorization cap to 455,000, extends program authorization to 2024, and authorizes RAD conversions of the approximately 120,000 units in Section 202 properties (low-income senior housing) with Project Rental Assistance Contracts (PRAC). Unfortunately, it does not provide any incremental funding to facilitate such conversions.
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Tenant Based Rental Assistance
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$22.015 billion for tenant-based rental assistance (TBRA) (5.3% increase), $19.6 billion of which is to renew previous contracts.
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Project-Based Rental Housing
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$11.515 billion to renew project-based rental assistance contracts for calendar year 2018
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Fair Housing
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While the bill does not change the budget for HUD’s office of Fair Housing and Equal Opportunity, it does include unhelpful rider language prohibiting HUD from directing local governments to change their zoning laws under the agency’s Affirmatively Furthering Fair Housing (AFFH) rule or with the AFFH assessment tool.
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USDA 521 Rental Assistance
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$1.345 billion (4.3% DECREASE) Unfortunately, this program dropped in funding from FY17 level of 1.405 billion
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USDA Multifamily Preservation & Revitalization
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47 million (14.63% increase)
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Choice Neighborhoods Initiative
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$150 million (9.1% increase)
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Community Development Financial Institutions (CDFI) Fund
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Within Treasury, $250 million (.08% increase). This includes $160 million for financial awards and technical assistance as well as $500 million in guarantee authorization level for the CDFI Bond Guarantee program level with FY 2017.
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More housing program funding details:
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See the “FY 2018 Final” column of this chart for the National Low Income Housing Coalition for a longer list of key housing program funding levels within HUD and USDA, such as 202, 811, HOPWA, etc.:
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