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Earlier this month Congress took steps related to HUD’s FY ‘24 budget that, if they come to fruition, would damage the agency’s ability to help those most in need of assistance.

The House Appropriations Committee approved a HUD funding bill that would slash the HOME Program allocation by $1 billion (67 percent). The bill also would cut hundreds of millions from smaller HUD programs that finance housing for the elderly and people with disabilities and would eliminate the Choice Neighborhoods public housing redevelopment program.

The HOME Program serves many important purposes, including acting as a “gap filler” in Housing Credit transactions, strengthening their feasibility and allowing more to achieve deeper income targeting to serve people experiencing homelessness, seniors, veterans, and those with disabilities.

According to the National Council of State Housing Agencies (NCSHA), HOME contributed $6.5 billion to Housing Credit developments between 2010 and 2021, providing an average of more than $900,000 per project. In half the states in 2021, HOME funds provided gap funding necessary for 20 percent or more of Housing Credit homes, and in 13 states HOME is in 40 percent or more of the units, according to NCSHA analysis. HOME funds have been especially critical to keeping projects afloat during the more recent period of extraordinary high construction costs.

NCSHA goes on to say that “As impressive as HOME’s aggregate accomplishments are — more than 1.3 million homes completed and 360,000 renters assisted — its value proposition may be best expressed in a much smaller number: $4.59. That’s the amount of funding from other sources, including the private sector, that every dollar of HOME attracts, according to HUD.”

HOME is coming off two consecutive years of its highest funding levels in more than a decade, which was still short of what states and cities need. The move toward cutting HOME funding by $1 billion will damage the program and the people it serves as the housing and homelessness crisis shows no signs of abating.n

Affirmatively Furthering Fair Housing rule also challenged

In addition to cuts to HOME, the bill would eliminate the “Yes In My Backyard” program, which received $85 million in FY23 to provide grants to jurisdictions that implement land-use and zoning reforms to expand affordable housing and would prohibit HUD from implementing its proposed Affirmatively Furthering Fair Housing rule.

The rule requires grantees to assess “How have existing zoning and land use policies or ordinances, the presence or lack of source of income anti-discrimination laws, eviction policies and practices, and other State and local policies or practices contributed to the patterns of segregation…” and “This analysis shall include… municipal or State policies, such as zoning and land use policies, ordinances, or regulations…”

Some conservative members of Congress say that the Affirmatively Furthering Fair Housing rule impinges on localities’ right to enact whatever zoning laws they see fit. However, in many cases, local zoning laws are hostile to affordable housing and the United States is at a deficit of about 7.3 million affordable housing units.

US Housing Consultants will continue to monitor the HUD budget as the process continues.

Joe Miksch is the Public Relations and Marketing Manager for US Housing Consultants.