January 17, 2014
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Late yesterday, the Senate passed by a vote of 72 to 26 the FY 2014 omnibus appropriations bill, H.R. 3547.  The House approved the same bill the day before, 359 to 67.  The President is expected to sign the bill soon.  The omnibus, which includes all 12 appropriations bills, sets final FY 2014 appropriations levels and funds all federally funded agencies, including HUD and the Department of Agriculture (USDA), through the end of FY 2014 (September 30, 2014).

As described in NCSHA’s January 14 blog post, the omnibus adheres to the $1.012 trillion discretionary spending limit agreed to in the Bipartisan Budget Act of 2013, the budget deal negotiated by House Budget Committee Chairman Paul Ryan (R-WI) and Senate Budget Committee Chair Patty Murray (D-WA).  NCSHA’s analysis of the funding levels and policy provisions for HUD programs and USDA rural housing programs included in the omnibus follows.

HUD
The bill includes $32.8 billion for HUD.  Compared to final FY 2013 funding levels, the bill includes a 5 percent increase for the HOME Investment Partnerships program (HOME), a 13 percent increase for project-based Section 8 contract renewals, a 6 percent increase for Section 8 Housing Choice Voucher (voucher) renewals, a 15 percent increase for voucher administrative fees, a 9 percent increase for homeless assistance grants, and an 8 percent increase for the Section 202 Housing for the Elderly program.

The bill includes, compared to final FY 2013 levels, a 2 percent cut to the Community Development Block Grant program (CDBG), a 5 percent cut to housing counseling assistance, and a 19 percent cut to the Section 811 Housing for Persons with Disabilities program.

The omnibus funds HOME at $1 billion, $52 million more than its FY 2013 level.  It also includes language removing for any HOME project to which funds were committed on or after August 23, 2013, the effective date of the 2013 HOME Rule, the statutory oversight provisions included in the FY 2012 and FY 2013 appropriations bills.  Without this language, some HOME projects would have been subject to both the statutory provisions and the HOME Rule requirements.

Project-based Section 8 is funded at $9.9 billion, $1.1 billion more than its FY 2013 level.  The funding level includes $265 million for performance-based contract administrators, $9 million less than provided in FY 2013.  The report accompanying the omnibus, called the joint explanatory text, states, “The agreement does not include specific direction on whether the Department should administer funding for performance-based contract administrators either through a procurement process or by a notice of funding availability."

The omnibus includes $19.2 billion for the voucher program, $1.2 billion more than the FY 2013 level.  This amount includes $17.4 billion for voucher renewals, $1 billion more than the FY 2013 level, and $1.5 billion for administrative fees, $194 million more than the FY 2013 level.  It also includes $75 million for new HUD-VASH vouchers.  The bill includes as a separate account $75 million for family self-sufficiency (FSS) coordinators.  According to the explanatory text, public housing authorities (PHAs) can run one FSS program for all residents, regardless of the type of housing assistance they receive.

The omnibus includes language allowing for biennial, instead of annual, inspections of units occupied by tenants receiving voucher assistance.  It allows inspections conducted for other housing programs, such as HOME or the Low-Income Housing Tax Credit, to qualify as alternative inspection methods.  The bill also defines extremely low-income (ELI) families to mean very low-income families whose incomes do not exceed the higher of the federal poverty line or 30 percent of area median income (AMI).  The bill modifies utility allowances to limit the allowance amount for tenant-paid utilities to no more than the appropriate utility allowance for the family unit size as determined by the PHA, regardless of the size of the actual unit leased by the family.  It requires a PHA to approve a higher utility allowance request for a family that includes an individual with disabilities, if needed as a reasonable accommodation.

The omnibus provides $2.1 billion for homeless assistance grants, $172 million more than provided in FY 2013.  This funding level includes at least $250 million for the Emergency Solutions Grants program (ESG) and $1.8 billion for the Continuum of Care (CoC) and Rural Housing Stability Assistance programs.  The bill also includes language allowing private non-profit organizations to administer FY 2012, 2013, and 2014 funds appropriated under the CoC program for permanent housing rental assistance.

The bill includes $3.1 billion for the Community Development Fund, $36 million less than the FY 2013 level, including $3 billion for the CDBG program, $48 million less than the FY 2013 level.

The bill provides $384 million for the Section 202 Housing for the Elderly program, $29 million more than the FY 2013 level.  This amount includes $72 million for service coordinators and existing congregate service grants.  The bill also allows for funds to be used to conduct demonstration programs to test housing with services models for the elderly that demonstrate the potential to delay or avoid the need for nursing home care.

The bill provides $126 million for the Section 811 Housing for Persons with Disabilities program, $30 million less than the FY 2013 level. Funds will be used to renew and amend project rental assistance contracts and to provide project rental assistance to state housing finance agencies (HFAs) and other appropriate entities.

The omnibus includes $1.9 billion for the Public Housing Capital Fund, $98 million more than the FY 2013 level, and $4.4 billion for the Public Housing Operating Fund, $346 million more than the FY 2013 level.  It requires PHAs to set by June 1, 2014 flat rents at levels no lower than 80 percent of the fair market rental rate.  If the new rental amount for a unit would increase a family’s rental payment by more than 35 percent, the new amount will be phased in.  The bill also allows for consortiums of PHAs.

The omnibus funds Choice Neighborhoods at $90 million, of which at least $55 million must be awarded to PHAs.  The bill includes no new funding for the HOPE VI program.  The bill includes $330 million for the Housing Opportunities for Persons with AIDS program (HOPWA), $50 million for the Self-Help and Assisted Homeownership Opportunity Program (SHOP), $45 million for HUD’s Housing Counseling program and $68 million for the National Foreclosure Mitigation Counseling (NFMC) program, and $110 million for lead-based paint hazard reduction.

The omnibus extends Rental Assistance Demonstration (RAD) authority for converting Rent Supplement (Rent Supp), Rental Assistance Payment (RAP), and Mod Rehab units through December 2014.  Authority for converting public housing units does not expire until September 30, 2015.  The bill does not increase the 60,000 public housing unit cap.

USDA
Compared to final FY 2013 levels, the omnibus includes a 32 percent increase for the Section 521 rural rental assistance program and a 41 percent increase for the Section 542 rural housing voucher program. 

The omnibus includes $900 million for the Section 502 single-family subsidized direct loan program, $24 billion for the Section 502 unsubsidized guaranteed loan program, $150 million for the Section 538 multifamily loan guarantee program, and $28 million for the Section 515 rural rental housing loan program, all equal to their FY 2013 levels.  The bill instructs the USDA Secretary to expand a current pilot program for packaging Section 502 single-family subsidized direct loans.

The omnibus provides $1.1 billion for the Section 521 rural rental assistance program, $272 million more than the FY 2013 level.  The bill also directs USDA to fund rental assistance agreements for a one-year period.  According to the explanatory text, the USDA Secretary is directed to develop and report to the appropriations committees proposals to “make short and long-term program adjustments to ensure the long-term stability and sustainability of the rental assistance program.”

The bill includes $12.6 million for the Section 542 rural housing voucher program, $3.6 million more than the FY 2013 level.  It also provides $20 million for the Multifamily Preservation and Revitalization (MPR) demonstration program.

The bill includes language to allow any area currently eligible for rural housing programs to retain that eligibility through FY 2014.  USDA will use 2010 Census data in FY 2014 to determine an area’s eligibility for rural housing programs and without this eligibility provision, many communities currently considered rural would no longer meet the rural definition criteria.

View NCSHA’s budget chart, which shows how HUD and USDA program funding levels in the omnibus compare to FY 2013 appropriations, the President’s FY 2014 Budget proposal, and the FY 2014 Senate and House-proposed funding levels, for additional information.