| HUD No. 00-288 | |
| Further Information: | For Release |
| In the Washington, DC area: 202/708-0685 | Thursday |
| Or contact your local HUD office | October 19, 2000 |
CUOMO HAILS BEST HUD BUDGET IN 20 YEARS
WASHINGTON -- Secretary Andrew Cuomo today
hailed Congress’ approval of this year’s budget for the Department
of Housing and Urban Development as a victory for working families across
the nation. Responding to President Clinton’s fiscal year 2001 budget
request, it is the highest funding level approved by Congress since 1981.
The landmark budget will provide affordable housing or homeownership assistance
for nearly 7.5 million families in the coming year.
The $32.4 billion in program funding approved by Congress and sent to President
Clinton today represents a $4.2 billion or 16 percent increase over fiscal
year 2000.* The budget includes across-the-board increases in virtually
every HUD program, including record funding for community development and
housing block grants (CDBG and HOME), record funding for homeless assistance,
record funding for Native American programs, and the largest increase in
housing vouchers in more than 15 years.
"This budget directly addresses the realities of the changing economy," said Secretary Cuomo, "especially skyrocketing housing costs in high job-growth areas that are creating a shortage of affordable housing, not just for low-income families but for the middle class as well." Cuomo called the budget convincing proof of the Department’s transformation over the past four years, and testimony to the Clinton-Gore Administration’s commitment to the people and places not yet sharing in America’s success.
"With this budget, we have the most resources we’ve had in 20 years to meet the needs of America’s families" Cuomo said. "The message is clear. HUD’s reinvention is a success. Four years ago we were threatened with elimination. But today we are fulfilling the promise that John F. Kennedy had in mind when he first proposed this Department more than forty years ago."
Highlights of this year’s budget include:
Largest increase in new housing vouchers for families in 15 years
In addition to $13 billion to renew all existing vouchers, the budget provides for about 80,000 new housing vouchers to enable more families to find affordable housing. This is the third straight year that new Section 8 vouchers have been funded, following a critical period in the 1990s when Congress failed to approve any new vouchers. Two years ago, Congress approved 50,000 new vouchers; last year 60,000. The new vouchers in the fiscal year 2001 budget represent the largest increase in more than 15 years.
Under a new HUD program – homeownership vouchers -- these vouchers will provide families an avenue to homeownership. HUD now allows the vouchers to be used for mortgage payments instead of rent -- an important breakthrough that will give thousands of assisted renters their first opportunity to purchase and own a home.
Adding to the 1.6 million vouchers already in use, these new vouchers also are a key community resource for addressing the growing shortage of rental housing. As a result of the booming economy, rents are rising at an average of 1.5 times the rate of inflation. Working families have been especially hard hit by rising housing costs, making up the fastest growing segment of the population with worst case housing needs – defined as households paying 50 percent or more of their incomes for housing or living in substandard housing.
New resources for cities to continue their economic recovery
This budget is the best budget for cities in 20 years. It will help cities continue the extraordinary recovery they have made in recent years, with increases in funds that cities rely on to build affordable housing, create jobs, attract business investments, repair decaying infrastructure and provide needed social services.
The Community Development Block
Program (CDBG) receives $5.1 billion, a $258 million increase over Fiscal
Year 2000. The CDBG program is a block grant program that gives cities and
smaller communities extraordinary flexibility to meet local housing and
economic development priorities. This year’s amount represents the
largest CDBG appropriation in its 25-year history -- creating an estimated
173,000 jobs and assisting 191,000 households with affordable housing.
- The HOME Program is funded at an
all-time record $1.8 billion, a $200 million increase over last year.
The HOME program is another flexible block grant program that communities
use to build and maintain affordable housing and expand homeownership.
These funds will create homeownership opportunities and affordable housing
for an estimated 67,000 families in the next year.
- Empowerment Zones (EZs) will immediately receive $75 million. Pursuant to
an agreement between the Administration and Congress, an additional $110
million will be provided immediately after Congress enacts the President’s
New Markets Initiative legislation. Under the leadership of Vice President
Al Gore, EZs have established a successful track record of creating jobs
and boosting private investment. These funds will provide funding for 20
urban and rural EZs authorized by Congress in 1997.
- America’s Private Investment Companies
(APIC), while not specifically included
in this budget, is slated to receive $37 million once New Markets legislation
is enacted, pursuant to the Administration’s agreement with Congress.
A cornerstone of the President’s New Markets Initiative, APIC will
create as much as $1.5 billion in pools of private equity capital for large-scale
business investment in under served rural and inner city communities.
Record funding to address homelessness and other special needs
HUD’s award-winning Continuum of Care for homeless persons receives a record $1.125 billion. This represents an increase of $105 million over last year, and more than twice the level of funding for homeless assistance at the start of the Clinton-Gore Administration. With an estimated 600,000 homeless persons on any given night in America, the funds will help local communities craft strategies for moving them into stable, permanent housing and into jobs and self-sufficiency. Homeless funding also includes full renewal of all Shelter Plus Care rental assistance.
Funding for housing disabled persons under
HUD’s Section 811 program also increases by $16 million to $217 million.
And housing for persons with AIDS or HIV increases by $26 million to $258
million – more than double the funding at the start of the Clinton-Gore
Administration.
Other key resources for local communities
- Housing Security for Seniors. Funding
for elderly housing increases by $69 million over last year to $779 million
– an increase that recognizes the need to provide housing security
for our nation’s rapidly growing elderly population. The budget includes
funding for HUD’s Housing Security Plan for Older Americans that offers
a full range of options – a Continuum of Care – for housing the
elderly. Overall, Section 202 senior housing is funded at $679 million
in fiscal year 2001. The budget also includes $50 million to convert existing
202 housing to assisted living, and $50 million to fund Service Coordinators,
who enable the elderly to continue to live as independently as possible.
- Continuing the transformation of public
housing. Public housing receives a total of $6.8 billion, a significant
increase over last year, to continue the dramatic transformation of public
housing initiated by the Clinton-Gore Administration over the past eight
years:
- Increased funding to revitalize or rebuild 169,000 units of public housing, with Capital Grants funded at $3 billion. In addition, the HOPE VI program – a winner this year of Harvard University’s prestigious Innovations in Government Award -- is funded at $575 million to replace more than 9,500 units in the worst developments with mixed-income, livable communities.
- Increased funding to maintain 1.3 million units of existing public housing, with operating grants rising to $3.2 billion, representing 100 percent funding under the Performance Funding System.
- Expanding homeownership for working
families. The Federal Housing Administration (FHA), an agency within
HUD and the nation’s most important tool for helping first-time home
buyers, minorities and central city residents buy a home, is granted authority
to insure $160 billion worth of home mortgage loans – funding that
would help approximately 1.2 million American families finance an FHA-insured
home this year.
- Fighting discrimination in housing. HUD’s Fair Housing programs are funded at
$46 million. This will give communities the tools they need to enforce
the Fair Housing Act of 1968, which prohibits discrimination on the basis
of race, religion, national origin, disability or family status. HUD has
already met the goal set by President Clinton of doubling its enforcement
rate for Fair Housing cases, and will expand that effort with these new
funds.
- Protecting the environment. Several initiatives that will contribute to healthier
communities and protect the environment are included in HUD’s fiscal
year 2001 budget. The Brownfields Economic Development Initiative is funded
at $25 million to support the cleanup of former industrial sites and their
redevelopment as economic development sites. Children are protected from
exposure to lead poisoning, with $100 million for lead hazard abatement,
a 25 percent increase over last year, to clean up 32,000 housing units.
Funding equal to $10 million is also provided for PATH, a cutting-edge
research and technology partnership with the building industry to explore
energy-efficient and cost-saving building design.
The total fiscal year 2001 figure of $32.4 billion refers to the total appropriation of $32.390 billion in program funding by Congress for fiscal year 2001, rather than the $30.557 figure scored by the Congressional Budget Office. The $32.390 billion figure includes offsetting receipts and reallocated funds which fund HUD programs but do not technically count as new budget authority for purposes of budget scoring.
Tom Cochran, Executive Director of the United States Conference of Mayors. "This budget breaks all records – record funding for CDBG, record funding for HOME, record funding for homeless assistance, and the biggest increase in Section 8 vouchers in 15 years. Congratulations to Secretary Cuomo and his team at HUD."
Chris Sumner, President, Mortgage Bankers Association. "The Mortgage Bankers Association of America heartily congratulates HUD and the Congress on the passage of what promises to be a highly effective fiscal year 2001 budget. The continuation of the FHA downpayment simplification and a requirement funding FHA’s multifamily program are important achievements included in this budget bill. These programs will provide immediate help for thousands of American families."
Sheila Crowley, President of the National Low-income Housing Coalition. "The National Low Income Housing Coalition is pleased that the 2001 HUD budget contains more resources for housing programs than it did last year. We commend Secretary Cuomo for his determination to make progress on solving the affordable housing crisis with his commitment to an improved HUD budget each year. A continuous increase in the number of new vouchers each year is a necessary step forward."
Richard Nelson, Executive Director of the National Association of Housing and Redevelopment Officials (NAHRO). "This budget is good news to communities that have housing and community development agencies working to address their needs. The budget is reflective of the growing confidence of the Congress in the administration of these programs at the federal and local level. We feel this is one of the initial steps in fully addressing the needs of our communities across the nation."
Phil Carroll, President Elect of the National Affordable Housing Management Association (NAHMA). "The fiscal year 2001 HUD appropriation will help both to ensure that the Federal government meets its commitment to those families who currently receive housing assistance and to provide expanded housing opportunities. It provides a strong foundation on which to build in the future, which we hope will include housing production initiatives. We appreciate Secretary Cuomo’s strong efforts on behalf of the housing budget."
Nan Roman, Executive Director of the National Alliance to End Homelessness. "This budget is evidence that HUD is finally getting the resources it needs to meet the needs of some of America’s most vulnerable citizens."
Robert Mitchell, President of the National Association of Home Builders. "The monies authorized under this bill for such key programs as CDBG, HOME, FHA multifamily credit subsidies, and Section 8 Contract Renewals will help provide badly needed housing for many of our nation’s low- and moderate income families. HUD’s best budget in 20 years is a great first step in meeting the housing needs of some of America’s most vulnerable citizens."
Lee Verstandig, Senior Vice President, National Association of Realtors. "NAR applauds Congress and HUD for enacting a fiscal year 2001 budget that clearly and effectively addresses the housing needs affecting our citizens and communities. We particularly commend their efforts to extend the FHA downpayment simplification calculation which will permit FHA borrowers to continue to obtain low-cost FHA mortgages. We wholeheartedly appreciate the fiscal year 2001 budget agreement to increase the funding the level for fair housing activities for greater outreach and education initiatives to promote equal and accessible housing in America."
Mary Alice Ryan, Chair of America Association of Homes and Services for the Aging (AAHSA). AAHSA is pleased that the Administration and Congress have reached agreement on the HUD fiscal year 2001 appropriations, including funding for affordable senior housing. We are particularly pleased with increased funds under the Section 202 program to enable non-profit organizations, primarily faith-based, to develop suitable and affordable housing for low-income older persons."
Don Ryan, Alliance to End Childhood Lead Poisoning. "The $20 million increase for lead poisoning prevention will help pave the way to ensuring that all federally assisted housing is lead safe. This is an important step in the right direction - and an important win for kids."
Kevin Marchman, Executive Director, National
Organization of African Americans in Housing. "HUD’s 2001 budget is good news for families across the country,
particularly low-income families who benefit most from these funds. With
the new 79,000 vouchers, continued support for the award-winning HOPE VI
program, record funding for the HOME program, and an increase in funds for
public housing, this budget will help improve and expand quality affordable
housing. We applaud the efforts of HUD and the Congress, and look forward
to continued work on a new housing production program."
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