HUD Ready with FY2013 Budget

The Department of Housing and Urban
Development (HUD) unveiled its 2013 budget proposal today, asking Congress for
about $44 billion.  The amount is roughly
the same as the amount Congress authorized for the 2012 budget year. 

In addition, HUD is asking for authority
to guarantee $400 billion in mortgages through FHA’s Mutual Mortgage Insurance
Fund which is expected to provide 1.2 million single family mortgages, $149
billion in loan volume, during the year and $500 billion in Ginnie Mae
guarantee authority in order to help finance a wide array of government-insured
products.  In addition it requests $25 billion
in loan guarantee authority for the General and Special Risk Insurance Panel
which will provide an estimated 156,000 units in multifamily housing properties
and 80,600 beds in health care facilities.

Approximately 75 percent of HUD’s budget
goes to rental assistance including both tenant and project based
assistance.  Among the tenant based program
(TBA) funds requested for the year are:

  • $17.238
    billion for the renewal of existing Section 8 vouchers, providing
    affordable housing for more than 2.2 million families in need, including the
    renewal of special purpose vouchers funded in previous years;
  • $1.575 billion for administrative fees associated with
    operating TBA.
  • $111
    million for Mainstream Section 811 vouchers to enable persons with
    disabilities access to affordable, private housing of their choice, and
    accommodate the provision of supportive services;
  • $75 million in Tenant Protection vouchers, which
    are provided to tenants to replace either public housing that is demolished or
    sold or projects
    assisted by Multifamily Housing programs that stop receiving federal subsidies;
    and
  • $75 million for the HUD-Department of Veterans
    Affairs Supportive Housing (HUD-VASH) vouchers to assist an estimated 10,000
    homeless veterans.

Project-based assistance provides
funds to state and local Public Housing Authorities to supplement rents and
maintain the properties.  HUD is
requesting $6.59 billion to operate public housing programs and modernize its
aging structures.  This request includes:

  • $4.524 billion in Public Housing Operating Funds to
    fund
    more than 3,100 public housing authorities to operate and manage approximately
    1.2 million units of publicly owned affordable rental housing units, and
  • $2.07 billion in Public Housing Capital Funds, primarily to
    address capital repair and replacement needs.

HUD’s Project-Based Rental
Assistance (PBRA) program provides rental assistance funding to privately owned
multifamily rental housing projects.  The
amount of PBRA funding paid to each owner is generally the difference between
what a household can afford (up to 30 percent of income) and the HUD-approved
rent for the unit.  For FY 2013, HUD is
requesting a total $8.7 billion in funding for PBRA programs which includes:

  • $8.44 billion for the renewal and amendment
    of existing PBRA contracts; and
  • $260 million for Project-Based Contract
    Administrators to
    effectively administer the PBRA program.

Another
budget item is over $7 billion to fund capital grants toward local housing and
community development initiatives. These include:

  • $9.95 billion for Community Development Block
    Grants;
  • $2.07 billion for modernization capital grants,
    administrative receiverships and financial and physical assessment support
    through Public Housing Capital funds.
  • $150 million for the Choice Neighborhood initiative;
    and
  • $60 million for Indian Community Development Block
    Grants.

Approximately
five percent of the HUD budget goes to various initiatives including remediation
of lead based paint hazards, housing counseling, fair housing and equal
opportunity, family self-sufficiency counselors, and research and data
collection.  This year HUD is requesting
a total of $2.1 billion for these initiatives.

In
presenting the budget, HUD Secretary Shaun Donovan said that it includes
several proposals to improve the efficiency and effectiveness of department
programs.

  • It merges its Public Housing Operating and Capital
    Funds programs into a single subsidy stream.
  • Outlines a proposal to streamline and enhance the
    Family Self-Sufficiency program,
  • .Includes a series of reforms to rental assistance
    programs that save over $500 million without reducing the number of families
    served;

Donovan said that while the
budget is holding the line on increased expenditures, it:

  • Maintains
    housing assistance for all families currently receiving rental subsidies;
  • Serves
    almost 2.5 million families living in public housing and project-based Section
    8 developments over 60 percent of whom are elderly and disables;
  • Supports
    tenant-based vouchers for more than 2.2 million families over $45 percent of
    whom are elderly and disabled;
  • Provides
    10,000 new vouchers to homeless and funds 5,300 more in supportive housing;
  • Enables
    FHA and Ginnie Mae to continue their crucial, temporary countercyclical roles;
  • Brings
    private capital back to the market through FHA premium increases and other
    measures;
  • Assists
    nearly 5.5 million households, an increase of 82,000 over fiscal year 2011;
  • Creates
    or retains 423,000 jobs directly and 360,000 more indirectly.

…(read more)

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