Affordable housing advocates breathed a sigh of relief after Congress approved a $1.1 trillion spending plan last week.

The budget provides no big victories to cheer, but it's not nearly as grim as it could have been.

“The primary virtue of this appropriations omnibus is that it’s not a train wreck—no CR (continuing resolution), no government shutdown, but also constrained spending to address housing need,” says Ethan Handelman, vice president for policy and advocacy at the National Housing Conference.

The voucher program should be able to avoid canceling existing assistance, but there’s no way to make up for the reductions in the past several years, and project-based rental assistance will likely face some short-term contract renewals again this year, according to Handelman, who adds that the HOME and Community Development Block Grant (CDBG) programs avoided further cuts but are still at levels low enough to be alarming just a few years ago.

“In short, this appropriations law looks good only because it could have been a whole lot worse,” he says.

Under the omnibus bill, project-based rental assistance will receive $9.92 billion in fiscal 2014. That’s more than last year but still about $1.5 billion less than what is needed for full funding, says Denise Muha, executive director of the National Leased Housing Association.

The Housing Choice Voucher program will be funded at $19.18 billion, up about $1.2 billion from the 2013 post-sequestration level. The funding includes $17.37 billion for contract renewals. Another $130 million will be directed to “tenant protection vouchers,” nearly doubling the post-sequester level of $71 million.

Muha says she won't be throwing a parade, but the spending plan beats the recent sequestration that cut program funding across the board.

The new bill provides $75 million for 10,000 new Veterans Administration Supportive Housing vouchers, level with the prior year funding.

In another move, the Rental Assistance Demonstration program is extended, but the bill did not increase the number of public housing units eligible for the demonstration. The program is expected to hit its 60,000-unit limit for public housing conversions early this year, and leaders at the Department of Housing and Urban Development have been seeking to increase the cap.

A Win for Working Families
The spending package splits the difference between the earlier Senate and House committee proposals, leaning toward the more favorable Senate plan, says Sheila Crowley, president and CEO of the National Low Income Housing Coalition.

“It is still less money than required to meet a baseline we had a few years ago, but given what they had to work with it’s a significantly better bill than we might have had otherwise,” she says.

The budget is a win for thousands of working families in our country, according to Bob Moss, principal and national director of governmental affairs at CohnReznick. “The planned sequestration cuts would have eliminated up to 100,000 housing vouchers at a time when demand is increasing,” he says.

Moss notes that HOME, a critical gap funding source, was supported at $1 billion. “Many of the states have lost their local housing production resources to balance state budgets, and maintaining the HOME monies helps fill that need,” he says.

The new budget agreement brings some relief to the stress placed upon housing and development programs, but it’s also far from a remedy to the stresses placed upon communities across the country, adds David Gasson, executive director of the Housing Advisory Group, and vice president, director of communications, at Boston Capital.

“What will be telling is whether future budget cycles acknowledge the growing need for federal support of housing or a return to deficit-reduction-at-any-cost politics,” he says.

Also in the budget:

  • The Public Housing Operating Fund receives $4.4 billion. This is more than the $4.26 billion enacted in 2013 but below the $4.6 billion proposed by the President and the Senate;
  • The Public Housing Capital Fund receives $1.88 billion, level with the fiscal 2013 enacted, or pre-sequestration, amount;
  • Community Development receives $3.1 billion, including $3.03 billion for CDBG formula grants. CDBG funding is slightly higher than the fiscal 2013 appropriation, excluding disaster funding;
  • Homeless Assistance Grants are funded at $2.11 billion, $72 million above the 2013 enacted amount ;
  • The Sec. 521 rental assistance program under the Department of Agriculture receives $1.11 billion, $226 million more than the fiscal 2013 enacted amount;
  • The Sec. 202 housing for the elderly program receives $384 million, just above the $375 million enacted level  in fiscal 2013;
  • The Sec. 811 housing for the disabled program receives $126 million, nearly $40 million below the fiscal 2013 enacted amount;
  • The Housing Opportunities for Persons with AIDS program receives $330 million, $2 million below the fiscal 2013 enacted amount; and
  • Choice Neighborhoods receives $90 million, down from $120 million enacted in fiscal 2013 and far less than the $400 million requested by the President and the $250 million proposed by the Senate. The House did not include any funding for Choice Neighborhoods in its proposal.