State and Federal Budget Issues

Details on Proposed FY 2008 Funding for Housing and Homeless Programs

November 20, 2007

FY 2008 funding for programs at the Department of Housing and Urban Development (HUD) is included in the $50.7 billion Transportation-HUD Appropriations bill (HR 3074/S 1789).  This includes $38.75 billion for HUD for FY 2008, or $2.12 billion more than the current FY 2007 level, and $3.15 billion more than the President’s request.

HUD Section 811 Funding Restored

The House-Senate agreement on HR 3074 restores deep cuts proposed for the HUD Section 811 program for FY 2008 by the President.  Specifically, the bill allocates $237 million for Section 811, rejecting a proposed $112 million cut to the program.  This is the 3rd year in a row that Congress has rejected proposed deep reductions to Section 811 by the Bush Administration.  For FY 2008, the President had proposed to deep reductions to new capital advance/project-based grants under Section 811, requesting only $15.84 million in new grants.

Capital advance and project-based grants to local non-profit disability organizations are the traditional form of 811 funding and actually expand the inventory of accessible supportive housing serving individuals with severe disabilities -- including severe mental illness.  This is in contrast to tenant-based rent subsidies that cannot be used to develop new supportive housing units. 

Since the President's budget came out in February, NAMI (along with colleague national disability groups) fought to restore funding for Section 811.  NAMI is extremely grateful for the leadership of Representative John Olver (D-MA) and Senator Patty Murray (D-WA), the Chairs of the House and Senate Appropriations Subcommittees that drafted the Transportation-HUD bills. 

Specifically, the House and Senate agreement allocates funding within Section 811 as follows:

  • $145.875 million for new capital advance/project-based grants,
  • $74.7 million to renew expiring tenant-based rent subsidies and contract amendments (additional funds to lease up previously allocated tenant-based contracts), and
  • $15 million for renewal of existing project-based subsidies (known as PRACs). 

The bill includes no funding for new Section 811 tenant-based rental assistance.  NAMI and a coalition of other national disabilities organizations had urged Congress not to fund any new Section 811 tenant-based assistance (also known as the “mainstream” voucher program for people with disabilities) out of concern that HUD has failed to ensure that housing agencies are actually targeting rental assistance to individuals with severe disabilities. 

Section 8 Rental Voucher Funding – New Funding for Non-Elderly Disabled Vouchers

Section 8 is by far the largest program in the HUD budget.  Most of the $16.3 billion Section 8 budget goes to renew the 1.9 million rental vouchers now in use.  This includes a $500 million increase in the Senate bill above current levels, which is about $350 million above the President’s request. 

More importantly, the bill allocates funding for new tenant-based vouchers targeted to non-elderly people with disabilities, including severe mental illness.  These new vouchers, known as “incrementals” would allow HUD to fund new vouchers for the first time in nearly 7 years.  This is a tremendous victory for NAMI and allies in the larger disability community and marks an important step forward in helping to relieve the extremely long waiting lists that exist out there for people living on SSI to access rental assistance through the Section 8 program.  Specifically, the final bill allocates $30 million for this purpose – enough to fund 4,000 new incremental vouchers targete to non-elderly people with disabilities. 

For the Section 8 project-based program, the final bill allocates $6.38 billion to renew to the 1.3 million rent subsidies tied to affordable housing projects serving most elderly households and people with disabilities.  This is $503 million more than current levels, and $667 million above the President’s request. 

McKinney-Vento Homeless Funding Increased

The House-Senate agreement fully funds the Bush Administration’s request to increase the McKinney-Vento Homeless Assistance Act by $146 million for FY 2008, boosting funding to $1.586 million.  This is $25 million above the amount allocated in the House bill.  This includes funding for permanent housing programs such as Shelter Plus Care and SHP, as well as renewal of expiring rent subsidies.  In addition, the Senate bill requires HUD to continue directing a minimum of 30% of McKinney-Vento funds for permanent housing, with a 25% local match required for services. 

Homeless Veterans

The House-Senate agreement on HR 3074 includes $75 million in funding for new rental vouchers for homeless veterans – many of whom have a severe mental illness and a co-occurring substance abuse disorder.  This is assistance would be made available through a joint HUD-VA program that combines housing assistance from HUD with medical and psychiatric care and other supportive services from the VA.  It is expected that this $75 million total could support as many 10,000 units of supportive housing for homeless veterans.

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