CARH'S BROADCAST E-MAIL –
Legislative Update

January 17, 2014

After 16 days of a government shutdown in October, a budget agreement which set the functional totals for the federal government's programs for two years, Congress passed this week and President Obama will sign into law, the $1.012 Trillion Omnibus Appropriations bill (H.R. 3547) for FY 2014.  Included in H.R. 3547 is funding for all of Rural Development (RD) and the Department of Housing and Urban Development's (HUD) programs.

As CARH members know from previous emails (January 10, 2014, December 16, 2013, October 17, 2013, October 4, 2013), CARH has been advocating for additional funding for all affordable housing programs given sequestration in FY 2013.  As CARH members can see from the updated funding charts for USDA and HUD, RD programs, specifically the Section 521 Rental Assistance (RA) program, will have higher levels of funding in FY 2014 than in FY 2013 because sequestration will not be in effect.  In fact, H.R. 3547 provides $1.110 billion for RA, which is $95 million more than the FY 2014 budget request and $250 million over the FY 2013 level, with sequestration. This additional funding is needed to make up for any short-fall that occurred in FY 2013.  In addition, the Appropriation Committees added some report language regarding the RA program and the development of "contingency plans" for the future:

"The agreement directs the Secretary to develop proposals to make short and long-term program adjustments to ensure the long-term stability and sustainability of the rental assistance program. In developing these proposals, the Secretary shall consider the management mechanisms and authorities that the Housing Acts governing other federal multi-family housing programs provide that USDA currently does not have, mechanisms that would enable the Department to proactively and strategically manage any future funding shortfalls, and the long-term viability of the program. The Secretary is directed to expeditiously report to the Committees on these proposals."

As CARH members recall, the Senate Appropriations Committee, in its version of the FY 2014 funding bill, had also included report language on the RA program.  The language in the Omnibus Appropriations bill is important and indicates that members in both the House and Senate recognize adequate and accurate funding of the program is a priority.

Additional programs of interest to CARH members include the following: The Section 538 Rural Rental Housing Guaranteed Program will have a program level of $150 million; the Rural Rental Housing Demonstration program or MPR will have $20 million; $12.6 million for rural housing vouchers; $28.4 million for the Section 515 program.  In addition, the Committees also agreed to maintain the current rural designation for communities until September or the end of the current fiscal year, rather than change based on the 2010 census as had been proposed.

The HUD appropriation is $32.8 billion with $9.5 billion for project-based Section 8 (plus $400 million previously appropriated); the Section 8 tenant based is $17.365 billion; $1 billion for HOME (a $50 million increase for a program unjustly attached year before last); $3 billion for CDBG (down from a few years ago but a slight increase from last year); Public Housing is largely stable ($1.875 billion for the Capital Fund and $4.4 billion for the Operating Fund); Section 202 is $383.5 million; 811 at $126 million; CHOICE Neighborhoods at $90 million.  There were no funds appropriated for RAD and only a partial extension, just for the component 2, through the end of 2014.

Apart from spending legislation, there are no new major developments about tax reform, perhaps because the Senate Finance Committee Chair, Max Baucus (D-MT), has been nominated to become U.S. ambassador to China.  Senator Ron Wyden (D-OR) will take over as Chair.  It is believed that Senator Wyden also wants to see tax reform, but he reportedly supports a current effort to extend expiring tax incentives, which would likely mean tax reform will be pushed to after the 2014 election.  In this regard, CARH will work to have included in any tax extenders legislation, S. 1442 that would set a permanent 9% credit rate for new construction and substantial rehab projects and 4% for acquisitions. We will also be continuing our efforts to ensure that the Housing Credit program continues.

Thank you to all CARH members who contacted their members of Congress and raised the issue of Rental Assistance and the negative impact of sequestration on properties and residents.  It is important that we continue this communication so that rural housing remains a priority as do other affordable housing programs.  The first part of this year is likely to remain active with the FY 2015 federal budget typically issued around this time of the year.  However, it is expected that the FY 2015 federal budget will be delayed due to the work on the FY 2014 budget.

Please contact the CARH national office at carh@carh.org or 703-837-9001 should you have questions or concerns.