DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
LEAD HAZARD CONTROL
LEAD-BASED PAINT HAZARD REDUCTION PROGRAM

SUMMARY OF BUDGET ESTIMATES

1. SUMMARY OF BUDGET REQUEST

An appropriation of $120 million is requested for the Lead-Based Paint Hazard Control Program, which includes $100 million for the lead-based paint program of grants and technical studies, $10 million for significantly expanded lead paint regulatory enforcement activities and $10 million for the Healthy Homes Initiative. This request is a critical part of the President's Task Force on Environmental Health Risks and Safety Risks of Children, which has developed an interagency strategy to virtually eradicate childhood lead-based paint poisoning by the year 2010.

With the development of strong local capacity through the HUD grant program, it is now possible to expand the effort to virtually eliminate childhood lead-based paint poisoning, which was first diagnosed by medical personnel over 100 years ago. The proposal targets funding to housing with low-income families with children, where lead hazards would not be eliminated without HUD's grant assistance. CDC estimates that 890,000 children have elevated blood lead levels, down from 1.7 million in the late 1980's. Despite this improvement, lead poisoning remains a major childhood environmental disease, especially among some populations. CDC estimates that 4.4 percent of all children aged 1 to 5 years have elevated blood lead levels. For children living in pre-1946 housing where lead paint is more common, the prevalence rate increases to 9 percent. For low-income children in older housing, it increases to 16 percent; and for low-income African-American children in older housing, the prevalence rate is 22 percent (data from the National Health and Nutrition Examination Survey, Phase II, 1991-1994). Lead based paint in old housing is the major remaining cause of childhood lead poisoning now that lead has been removed from gasoline and food canning, and lead in drinking water and industrial emissions have been reduced.

The Centers for Disease Control and Prevention (CDC), the Environmental Protection Agency (EPA), the Department of Justice and other agencies, pursuant to Executive Order 13045, are also submitting budget requests in support of the Task Force program. Proposals of these other agencies will include focused education and home-based housing assessments through existing health department programs for pregnant women and parents of children under one year of age, regulatory enforcement, broad public education, and perhaps other types of financial incentives.

Since the HUD grant program began in 1992, the ability of local jurisdictions to implement effective lead hazard control programs has improved dramatically. Grants are now active in over 200 local jurisdictions. A large, trained workforce has been created and the system exists to license more. Thirty-six states now have licensing laws and the remainder will have a system put in place by EPA by March 2000 to ensure the work is done safely.

Most grantees are involved in job training and job creation programs that employ low-income residents in the lead hazard control field. The skills gained are transferable to other related construction fields, making long-term employment more accessible.

There are also good scientific data showing that the modern hazard control techniques implemented by the grantees are successful in reducing both children's blood lead levels and contaminated housedust. These techniques are not designed to remove all lead paint, but to eliminate lead-based paint hazards. All grantees have public education programs designed to ensure that new hazards do not reappear once they have been controlled. The effectiveness data have been provided in annual reports to Congress for the past 3 years.

This Budget also requests resources needed to properly enforce lead-based paint regulations. While some grantees already use HUD grant funds to implement new local ordinances, new Federal requirements require HUD to implement new enforcement activities at the Federal level. Specifically, this budget requests $10 million to enforce the requirements of the Federal lead-based paint disclosure regulation and the new HUD regulation for Federally owned and Federally-assisted housing. The funds will be used in ways to leverage existing resources at HUD, the Department of Justice, local U.S. attorney offices and other local law enforcement personnel. Funds are needed to provide for investigative and legal services for the enforcement activities, which are targeted at housing that is known to contain lead-poisoned children, lead-based paint hazards, or other financial and management deficiencies that are likely to present lead-based paint hazards.

The budget requests a 50 percent increase in grant funding to help meet the 10-year goal. This will enable State and local grantees and HUD administrative staff to process the additional work.

Actual expenditures by HUD lead paint grantees have accelerated and have exceeded the appropriated amount in the past 3 years. Furthermore, only one in four applicants have been able to be funded in those years even though most of the applications demonstrated both need and capacity.

In order to increase production, HUD will implement several changes in the grant program. The grant's duration will be reduced from 3 years to 2 years for existing grantees, because no planning period is needed. Second, the amount of money designated for existing grantees will be increased. Finally, applicants will be scored on their ability to work with community-based organizations and others to integrate lead hazard control into routine housing rehabilitation, finance, and maintenance operations, to build further local capacity and to produce lead-safe units quickly. Through the competitive process, funds will be targeted to jurisdictions with a proven track record and where the need is greatest.

Most residential lead-based paint is contained in housing built before 1960. Between 86 and 97 percent of all lead in residential paint is located in pre-1960 housing. Therefore, resources to address residential lead-based paint hazards should be targeted to pre-1960 units.

Based on data from the American Housing Survey, HUD estimates that in 1999 there are about 24 million pre-1960 dwelling units that are not zero-bedroom units (where children are unlikely to reside), have not undergone major renovation (e.g. total window replacement) that would have removed lead based paint hazards, or have not had lead-based paint hazards controlled for some other reason (including regulatory compliance). The term "lead-based paint hazards" is used here as defined in the Residential Lead-Based Paint Hazard Reduction Act of 1992. Based on scientific research conducted in the 1980's, Congress defined a lead-based paint hazard to include deteriorated lead-based paint and lead-contaminated dust and bare soil. Controlling these sources and pathways of exposure will eliminate childhood lead-based paint poisoning. This research and the new definition enables resources to be targeted efficiently to where the need and benefits are greatest.

Assuming current trends continue until 2010, these 24 million pre-1960 units with lead paint will be further reduced by the following activities in the general housing market:



Demolitions and major renovations are based on rates experienced between 1989 and 1997, as reported in the American Housing Survey. The estimated number of units undergoing private hazard control is based on the HUD-funded supplement to the Current Population Survey. As public awareness increases and enforcement of regulations is strengthened, it is likely that the number of units undergoing privately funded hazard controls will increase further.

In addition to demolition, renovation, and private hazard control, additional units will undergo hazard control as a result of HUD's regulation on lead-based paint hazard reduction in Federally assisted housing. Based on the Economic Analysis for the rule, HUD estimates that the regulation, which was published September 15, 1999, will produce 1,400,000 pre-1960 lead-safe units during the 10 years from 2000 to 2010.

Table 1

Number of Pre-1960 Units at Risk of Having Lead-Based Paint Hazards in 2010 At Current Rates of Demolition and Major Renovation, Private Hazard Controls, and Compliance with the New HUD Regulation for Federally Associated Housing



Many units with lead paint may not pose any threat if they are maintained in such a way that the lead paint does not become hazardous. HUD's public education activities are designed to integrate lead hazard control activities into housing finance, maintenance, and rehabilitation procedures.

But for low-income children, direct Federal financial assistance (combined with leveraged non-Federal assistance) will continue to be needed because no other effective option exists. The HUD lead hazard control grant program has shown that the programmatic expertise exists in local jurisdictions across the country to target Federal resources to housing occupied by at-risk, low-income families.

Households with incomes less than 1.3 times the poverty level (Poverty Income Ratio (PIR<1.3)) occupy about 20 percent of all units according to the 1997 American Housing Survey. Applying this percentage to the 18.4 million units with lead-based paint that exist before the HUD rule results in 3.7 million units. Subtracting the 1.4 million units affected by the HUD rule (because virtually all these will be occupied by families with incomes of PIR<1.3) yields a remainder of 2.3 million units.

Thus, if lead-based paint hazards are controlled over a 10-year time period, an average of 230,000 units would need to be evaluated and any identified lead-based paint hazards controlled each year for 10 years.

Per unit cost estimates are based on the HUD Economic Analysis and the Evaluation of the HUD Lead Hazard Control Grant Program, which are currently the most complete sources of cost data for this field. These data show an average cost of $120/unit for the lead hazard screen; and an average hazard control cost of $2,500 per unit (to cover paint stabilization and window work, cleanup and clearance). Hazard control costs are applied to 35 percent of the units to be addressed, because that is the frequency with which the Economic Analysis showed hazards to be present, to arrive at an overall average cost.

Average per unit hazard control costs are as follows:

$120 + (35% x $2,500) = $995 (or about $1,000)

In addition to hazard control work costs, there are several associated non-construction program costs, which are discussed further in the Program Description and Activity section below. These activities, namely public education and job training, enforcement, temporary occupant relocation during lead hazard control work, and technical studies and assistance have been found to be necessary for hazard control grant programs to be effective.

The expansion of the grant program is now possible because a nationwide infrastructure has been developed over the past decade, resulting in thousands of trained or licensed abatement contractors, inspectors, rehabilitation specialists and others. While capacity building will remain a key component of the grants, the increased funding will be directed to existing grantees which possess a demonstrated track record. Because the needed support functions are already in place, more funds can be devoted directly to controlling hazards in homes. HUD's existing grantees include 23 of the 25 largest cities with the highest levels of dilapidated pre-1940 rental stock, where lead paint hazards are most severe.

Lead poisoning remains one of the major childhood environmental diseases. In addition, asthma and other diseases related to housing conditions cause more than 4,500 deaths per year and cost the nation more than $6 billion annually. While more than seven million occupied housing units have physical problems that pose health and safety threats, there is currently no single approach that coordinates health and housing responses with disease and injury. It is clearly inefficient to conduct separate campaigns for each disease and each housing-related hazard. Instead, Healthy Homes will expand the partnership HUD has developed with the Centers for Disease Control and Prevention (CDC) and the Environmental Protection Agency (EPA) in childhood lead poisoning prevention to include other diseases and injuries. That partnership enables HUD to combine its existing expertise in urban planning, architecture, engineering, environmental science and overall housing issues with other agencies' expertise in the medical and public health areas.

Summary Of Program Strategic Objectives

The HUD Office of Lead Hazard Control funds programs that are essential to achieving HUD's Strategic objective 1.3 "American Housing is Safe." This proposed budget request is the centerpiece of an interagency effort to eradicate lead-based paint hazards to our children. We have the knowledge and the means to accomplish this goal. The appropriate time to act is now and the cost-benefit is both common sense and measurable. Implementing the lead hazard control plan will make all U.S. housing likely to be occupied by low-income children lead-safe within 10 years and virtually eliminate childhood lead-based paint poisoning.

2. CHANGES FROM 1999 ESTIMATES INCLUDED IN 2000 BUDGET

There was no change in budget authority. The actual obligations in 1999 were $18 million. The lower obligation of largely reflects $62 million of the $80 million appropriated in fiscal year 1999 being carried over for obligation to the first quarter of fiscal year 2000. Outlays were slightly higher than projected.

3. CHANGES FROM ORIGINAL 2000 BUDGET ESTIMATES

The 2000 Budget requested $80 million in budget authority and the enacted amount is $80 million. Obligations in 2000 are estimated at $144 million; this includes $62 million carried over from fiscal year 1999 and total transfers of $2 million from the Annual Contributions and Community Development Block Grant accounts. The 2000 Budget estimated outlays of $70.8 million. The current estimate of $80 million is reflective of actual outlays in 1999 from all sources. There are transfers of obligated balances from the Annual Contributions and Community Development Block Grants accounts.