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Housing Update, Action Needed: Deep Cut Sought for HUD 811 Program, New Housing Production Proposed for Elimination


March 7, 2005

As was reported in a NAMI E-News Alert last month, the Bush Administration’s FY 2006 seeks to cut funding for a key housing resource for people with severe mental illnesses and their families by 50% and completely eliminate funding for production of new units of supportive housing. NAMI is currently working with colleague disability organizations to oppose this unprecedented assault on a critical source of permanent supportive housing for non-elderly adults with severe disabilities.

Action Required

NAMI advocates are strongly encouraged to send a letter to both their U.S. Senators and their House member urging them to reject this proposal. Enter your zip code below to access a sample letter on this issue and a list of your representatives to contact now. If you do not see the box for entering your zip code, click here.

The Administration’s request for FY 2006 would devastate the Section 811 program and end the 30-year plus commitment from the federal government to production of new units of supportive housing for people with severe disabilities. NAMI affiliate leaders are especially encouraged to send this letter on their affiliate letterhead.


The President's budget would cut Section 811 in half, dropping funding down to $120 million from its current level of $238 million. More importantly, the budget proposes to completely eliminate all funding for new unit production in FY 2006 by zeroing out the capital advance/project-based side of the program. This is the 75% of HUD 811 funding that supports capital grants and project-based rental assistance for non-profit disability groups to develop new units of permanent supportive housing.

Instead, the President's FY 2006 budget proposes to direct the remaining $120 million in the Section 811 program to renewal of existing rent subsidies (both tenant-based and project-based), with a small amount left to fund new tenant-based subsidies. Specifically,

$80 million would be directed to tenant-based renewals, $5 million for project-based renewals (also known as PRACs) and $45 million of new tenant-based contracts. This means that more than 70% of all 811 funds would be consumed by the cost of renewing (i.e. keeping in place) housing funded under the program in previous years.

Moreover, the elimination of the capital advance/project-based side of the program would end a 30-year commitment from HUD to support the production of new housing targeted to non-elderly people with severe disabilities (including severe mental illnesses). Reliance solely on tenant-based assistance (portable rent subsidies that rely on voucher recipients being able to find rental housing on their own) also represents a major change in the targeting of 811 away from people with more severe impairments who need housing related supports.

By contrast to the 50% cut to the Section 811 program, the budget proposes to level fund 811's cousin for the elderly, Section 202 at $741 million. In fact, under the proposed budget Section 202 would actually produce more new units in FY 2006 through the redirection of funds previously allocated to planning grants.

Click here to read additional "Talking Points" on the threat to Section 811 (PDF, 145.35 kb).


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