(Taken from the Online NACCED Alert dated February 5, 2008)
CDBG, Other Programs Cut in FY 2009 Bush Budget Request
Yesterday, President Bush sent Congress a $3.1 trillion FY 2009 budget request. In it he seeks $38.5 billion for HUD, a $1 billion or 3% increase over the current year enacted (not including the $3 billion in supplemental CDBG that went to the Gulf Coast). While seeking increases in some programs, the budget once again proposes a deep cut for the Community Development Block Grant (CDBG) program. The budget proposes an $859 million cut in CDBG formula grants to $2.73 billion, down from this year's $3.57 billion.
The budget documents indicate the administration will again send Congress a CDBG legislative "reform" bill calling for a new allocation formula, elimination of the brownfields redevelopment, rural housing and economic development and Section 108 loan guarantee programs, and codifying the performance measurement system in the statute. The package would also call for a competitive challenge grant fund to incentivize communities to achieve particular results in targeted areas of economic distress. The same reform package has been sent to Capitol Hill in each of the last two years (see 5/26/06 NACCED Alert). The legislation has never found a sponsor willing to introduce it.
The HOME program is a winner under the budget proposal. Formula grants would get a boost from $1.7 billion to $1.9 billion. Set-asides within HOME include $50 million for the American Dream Downpayment Initiative program, $4 million for the management information system, and $10 million for technical assistance. The housing counseling program, which Congress funds as a set-aside within HOME, is proposed as a separate program by Bush to be funded at $65 million.
Homeless housing assistance also gets a boost in the budget to $1.64 billion over this year's $1.57 billion. However, the bulk of the increase is for renewal of Shelter Plus Care rent subsidy contracts.
The budget request includes a $1 billion increase for the renewal of project-based Section 8 rent subsidy contracts, which the budget document notes will fully fund all contracts up for renewal. The budget also calls for $14.32 billion to renew all Section 8 tenant-based rent subsidy contracts, down from this year's $14.7 billion. The budget documents state that the administration will submit a Section 8 reform legislative package "… to allow Public Housing Authorities to serve more families, simplify program administration, and promote local flexibility for more efficient service delivery. The package will remove the cap on the authorized number of units PHAs can serve, provide a predictable budget-based renewal funding formula, reform the rent determination formulas to gain administrative cost savings, and identify and adjust for unspent prior year balances to determine FY 2009 funding levels." This may be intended to influence a reform bill in the Senate, should one be introduced. The Section 8 Voucher Reform Act of 2007 passed in the House by a wide bipartisan vote last July.
The budget again zeros out the HOPE VI demolition and replacement of severely distressed public housing program and it cuts the public housing capital fund from this year's $2.44 billion to $2.02 billion. The public housing operating fund gets a $100 million increase under the budget request to $4.3 billion.
Housing Opportunities for Persons with AIDS is proposed to be level-funded under the budget at $300 million, while the Section 202 elderly housing program is cut from the current level of $735 million to $540 million. The Section 811 disabled housing program is also cut from the current $237 million level to $160 million. In addition, the lead-based paint hazard reduction program is cut from the current funding level of $145 million to $116 million.
Congressional democrats have labeled the budget "dead on arrival." Administration officials will defend the budget before congressional committees over the next month. The House and Senate Budget Committees will mark up the FY 2009 congressional budget resolution in March. That legislation is critical because it sets the overall ceiling on domestic discretionary spending. That number is then allocated to the House and Senate Appropriations Committees and then reallocated among the committees' subcommittees. Those numbers determine the latitude, or lack thereof, of the subcommittees to set funding levels for individual programs like CDBG and HOME.
Energy Block Grant Program Receives No Funding in Administration's Budget Request
The recently-enacted Energy Efficiency and Conservation Block Grant Program was not funded by the President in the FY 2009 budget proposal for the Department of Energy. The Administration's budget did not place a high priority overall on energy efficiency and renewable energy programs, reducing them 27 percent to $1.25 billion. The budget proposes to zero out a weatherization assistance program, renewable energy production incentives, and research into oil and gas development. The weatherization and renewable energy incentives program was cut by 79 percent to $285 million. Weatherization programs assist low-income families in reducing household energy bills by insulating their homes. Senate Energy and Natural Resources Chairman Jeff Bingaman (D-NM) says he is trying to add funding for weatherization to the economic stimulus bill.
Overall, the Energy Department's budget was increased to $25 billion, 4.7 percent more than the FY 2008 appropriation of $23.9 billion. The Department's budget proposal favors spending on nuclear energy and "clean" coal technologies.
(Taken from the Online NACCED Alert dated December 20, 2007)
House Gives Final Approval to Omnibus Appropriations Bill; CDBG, HOME Formula Grants Cut
Yesterday the House gave final approval to a massive, $555 billion FY 2008 appropriations bill. The bill, which cleared the Senate the previous day after $40 billion was added to fund the war in Iraq, now goes to President Bush who said he will sign it before the current "continuing resolution" expires tomorrow.
The omnibus bill which funds 14 cabinet agencies, including the Department of Housing and Urban Development, was scaled back to meet the Administration's insistence that it live within an overall ceiling on spending of $933 billion. To get to that level from the $953 billion ceiling included in the FY 2008 congressional budget resolution passed last spring congressional democrats targeted programs supported by republicans. They cut two HUD programs which enjoy wide republican support, Community Development Block Grant formula funds and HOME Investment Partnership formula funds. CDBG grants were reduced about 3% or $116.6 million from this year's $3.71 billion. HOME formula grants were reduced $76 million to $1.628 billion.
NACCED, NACo and others worked very hard this year in an effort to increase formula funding for CDBG and HOME. The House-passed version of the Transportation and Housing and Urban Development appropriations bill, H.R. 3074, had a $200 million increase in CDBG formula grants. That amount was reduced by $100 million in an earlier conference agreement on the bill that the president threatened to veto.
With the exception of the renewal of Section 8 project-based and tenant-based rent subsidy contracts, public housing operating subsidies, and homeless housing all of the other HUD programs were kept at their FY 2007 funding level. Section 8 renewal funding increased from this year's $21.9 billion to $22.77 billion. This appears to be a sufficient amount to renew all of the project-based contracts. Earlier it was reported that the Bush administration had not requested enough funds for this purpose. Homeless housing assistance will increase from this year's funding level of $1.44 billion to $1.585 billion, the same level requested by the administration. Included is sufficient funding to renew all Shelter plus Care and Supportive Housing rent subsidy contracts. No less than 30% of the homeless housing funding is to be used for permanent housing, and there is a 25% non-federal match when the funds are used for services.
The bill provides $179.38 million for Economic Development Initiative grants with funding for individual projects therein reduced by 2%. The same is true for Neighborhood Initiative Demonstration Grants, which are funded at $25.97 million. Members of Congress were denied funding for earmarks such as EDI and Neighborhood Initiative grants in FY 2007 when Congress passed a year-long continuing resolution.
Section 108 loan guarantee authority is funded at $205 million compared to this year's $137.5 million. Brownfields Redevelopment grants are funded at $10 million, and Rural Housing and Economic Development grants at $17 million.
Housing counseling, a set-aside within the HOME program, gets a modest increase from this year's $42 million to $50 million, while the American Dream Downpayment Initiative (ADDI) program gets $10 million. Both have the effect of reducing HOME formula grants. NACCED and others urged Congress not to fund ADDI, because even at this year's $25 million, it is woefully insufficient to be run as a formula-driven national program.
The HOPE VI demolition and replacement of severely distressed public housing program is level-funded at $100 million, as is the public housing capital program at $2.44 billion. The Section 202 Elderly Housing and Section 811 Disabled Housing programs are also level-funded at $735 million and $237 million respectively. The Public Housing Operating Subsidy program gets an increase from this year's $3.86 billion to $4.2 billion.
Finally, the lead-based paint abatement grant program is reduced by $5 million to $145 million, while the Housing Opportunities for Persons with AIDS gets a $14 million increase to $300.1 million. To view the complete HUD FY2008 Appropriations go here.
HUD officials have indicated that it will take two months from when the bill is signed to get formula grant funding to the earliest grantees.
NACCED, Others Meet with Senior CPD Staff
Last week, NACCED and representatives from other state and local housing organizations met with Acting Assistant Secretary of Community Planning and Development (CPD), Nelson Bregon and his senior staff to discuss a wide range of issues. One of the issues discussed was a possible role for the CDBG and HOME programs in responding to the subprime mortgage crisis. It was agreed that a task force of the organizations would be formed to look into the issue. As reported earlier, HUD staff indicated that the HUD Inspector General is looking into whether CDBG grantees are using their funds to supplant local funding for areas such as maintenance (like filling pot holes) and over using funds for code enforcement. This issue should be on the radar screen of every NACCED member.
Around The Agency
Net Gain of 10 new CDBG entitlements in FY 2008
There are 13 new entitlements, and three entitlements that have given up entitlement status to join their respective counties, leaving a net gain of 10 new entitlements added to the local pool of CDBG formula fund recipients in FY 2008. Five of the new city entitlements were formerly cooperating cities within urban counties; one city entitlement is forming a joint-agreement with an urban county. Of the thirteen entitlements, four our urban counties.
The following is a list of new CDBG entitlements in FY 2008: Delano, CA (formerly with Kern County); Rockland, CA; Coconut Creek, FL (formerly with Broward); Homestead, FL (formerly with Sarasota); Sandy Springs, GA (formerly with Fulton); Coeur d'Alene, ID; Grand Haven, MI; Jackson Township, NJ (joint w/Ocean County); St. Tammany Parrish, LA; Passaic County, NJ; Tulsa County, OK; and Horry County, SC.
Association Update
February 29 Consortia Training Postponed
Unfortunately, NACCED's Consortia Training Workshop scheduled for Friday February 29th 2008, in Washington, D.C. has been postponed to a later date. NACCED is in the process of scheduling another community development training to take place on that day. We apologize for any inconvenience this may have caused.
Last Updated ( Friday, 28 December 2007 )
NACCED Alert
Written by NJCDA Administrator
Tuesday, 18 December 2007
Legislative Update
(Taken from the Online NACCED Alert dated December 12, 2007)
FY 2008 Appropriations Bills in Flux
Finding an end game for the 11 unfinished, FY 2008 appropriations bills is proving elusive for the democratic congressional leadership. Before the Thanksgiving recess Senate Majority leader Harry Reid (D-NV) announced that democrats would wrap all remaining spending bills into an omnibus bill and "split the difference" with the president. President Bush in his FY 2008 budget proposed a cap of $933 billion in domestic spending. Last spring Congress passed its budget resolution with an overall ceiling of $952 billon in domestic spending. As Congress considered the individual spending bills, each with total spending above the president's request, the White House threatened a veto. The latest threat came in an announcement last Saturday by OMB Director Jim Nussle that the president would veto the "split the difference" proposal. According to press reports, when advised of the veto threat, Senate Appropriations Committee Chairman Robert Byrd (D-WV) said "…It is extraordinary, that the President would request an 11 percent increase for the Department of Defense, a 12 percent increase in foreign aid, and $195 billion for the war, while asserting that a 4.7 percent increase for domestic programs is fiscally irresponsible."
Earlier this week, the democratic congressional leadership abandoned an effort to lure enough republicans to support the "split the difference" approach, hoping to entice them into overriding a presidential veto. House Appropriations Committee Chairman David Obey (D-WI) has said democrats will now be forced to reduce the overall bill to the president's top line number. He proposed that all member earmarks be stripped from the bill, saving nearly $10 billion, with the rest coming from reductions in the "split the difference" bill. Senate republican leader Mitch McConnell threw cold water on eliminating the earmarks and instead suggested an across-the-board cut. It appears highly unlikely in this scenario that the $100 million increase in CDBG formula grants will survive. One congressional staffer has suggested that CDBG formula grants could be cut from this year's level. It seems likely that Congress will have to pass a third, short-term "continuing resolution" (CR) to fund programs at the FY 2007 level after the current CR expires on December 14th.
CDBG, HOME Included in NACo's 2008 Key Legislative Priorities
In spite of being overlooked last year, the programs most important to NACCED members were successfully included in NACo's top seven legislative priorities for 2008. The priorities were created within the frame work of "Restoring the Partnership" between federal and county government. In the preamble to the list of priorities, NACo states it has, "embarked on a mission to remind our nation's leaders of the singular importance of Federalism to the American system of government…through it we hope to strengthen the relationships between counties and the federal government in order to serve the American people better."
The second priority, called "maintaining and increasing the financial partnership," includes the following language addressing HUD programs: "Providing funding for programs such as PILT/CDBG/HOME/JAG/Homeland Security/WIA/Transportation and water infrastructure development and many other domestic programs that are the backbone of our ability to jointly provide for our citizens is essential." It goes onto say, "Funding for the Community Development Block Grant formula should be no less than $4.1 billion, with a goal of doubling the program over the next five years, and for the HOME formula grant program at no less than $2 billion." NACCED's Executive Director, John Murphy; NACCED's Representative to the NACo Board, Frank Newton; and NACo Legislative Staff worked together to secure this language in the priorities.
NACo's legislative priorities are approved annually at the winter Board of Directors meeting. This year, the meeting took place December 6 in St. Petersburg, FL. To view all of NACo's FY 2008 priorities, go here.
Legislative Update
OMB Issues Proposed Rule on Standard, Government Forms for Federally-Owned Property
The Office of Management and Budget published a proposed rule November 16 that asks for comments in regards to a new, "standard form for [federal] assistance recipients to use when they are required to provide a Federal agency with information related to federally owned property, or equipment and supplies (tangible personal property) acquired with assistance funds" under the Uniform Administrative Requirements for Grants and Agreements with State and Local Governments.
The proposed rule is the result of an inter-agency working group's efforts (chaired by someone from the National Oceanic and Atmospheric Administration) under the "Federal Grants Streamlining Initiative." The rule creates two reports (each with several attachments/supplements) that would be used in place of your current data collection tools whenever you are required to report on federally-owned/acquired property or tangible personal property (equipment and supplies) under CDBG, HOME, etc. The original intent behind this proposal may have been the desire to centrally track all federally-owned property, but its administrative impact may be much greater than that.
The proposed rule claims to not create any new reporting requirements, estimates a total annual burden of 2.75 hours, and estimates no additional cost to GSA, respondents, or other agencies for that matter (like HUD). The reports are paper-only and not electronic.
NACCED's Community Development Committee will be coordinating a response to this proposed rule; email Chair,
, with your comments. OMB specifically is requesting comments on, "Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the estimate of the burden of the proposed collection of information; the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology." Comments are due January 15.
HUD Issues Notice on the Use of CDBG for Housing
On November 21, HUD issued CPD-07-08, called, "Use of CDBG Program Funds in Support of Housing." This Notice is a comprehensive guide on the use of CDBG funds for housing activities, and includes over 10 years of new statutory and regulatory provisions created since the last Notice on this topic was issued. It describes the housing activities eligible under CDBG, including rehabilitation and reconstruction, conversion, new housing construction, tornado-safe shelters for residents of manufactured housing, housing counseling, fair housing activities, and housing services in support of HOME. It also describes the national objectives under which each activity can apply and the regulatory citations that support the guidance. To view the full Notice, go here.
HUD Toolkits on CDBG "Crosscutting" Requirements Online
As reported on in an earlier Alert, Apt Associates (under HUD contract) has developed five toolkits on crosscutting issues that govern the CDBG program, including financial management and procurement, environmental review, labor standards, acquisition and relocation, and fair housing. Three of the five toolkits are now available online. Each toolkit is a two-page PDF file that includes links to the OMB circulars, regulations, handbooks and notices, and other documents and forms related to the crosscutting requirement. The PDF also includes links to the training materials that Apt Associates is using to deliver live trainings of the toolkit. Training materials include powerpoint slides, a trainers guide, case studies, discussion questions, and lists of tips. To access the toolkits, go here.
