Federal housing subsidies at risk
Domestic agenda at bottom of list in D.C.
SEATTLE—January 23, 2003—The Seattle Housing
Authority is bracing for possible budget cuts as a result of
miscalculations by the U.S. Department of Housing and Urban
Development. Subsidies essential for operations and maintenance
might be cut by as much as 20 - 25 percent in HUD’s next budget
year.
Years of faulty projections and poor accounting
practices by HUD regarding how much money the federal government
would have available to support public housing authorities has led
to a $250 million shortfall in public housing funds across the
country this year.
In early January, HUD warned local housing
authorities that because of the shortfall they would receive only 70
percent of the subsidy they got in 2002. Housing authorities were
already struggling to maintain housing and provide needed services
after the $310 million Drug Elimination Program grant was cut last
year.
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Housing authorities around the nation registered
public dismay at such a far-reaching budget cut. The King County and
Seattle Housing Authorities joined with the Tacoma Housing Authority
to appeal for more funding at a news conference at Capitol Park in
Seattle on Jan. 15.
"Public housing comprises just four percent of
annual federal support for housing," said Harry Thomas,
executive director of the Seattle Housing Authority. "This cut
would make it harder for local housing authorities to do a good job of
maintaining our valuable inventory of public housing. The
administration needs to protect funding for these programs, not
reduce it." |
Sybil Bailey (right), a
resident of SHA's Denny Terrace, joins SHA Executive Director
Harry Thomas at a recent news conference.
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There is evidence that the public concern expressed
is making a difference in Washington, D.C. On Jan. 15, the day after the Seattle news
conference, HUD announced that subsidies in 2003 may only be cut by 10
percent rather than 30 percent. But because the administrators at HUD have not
requested additional funds from Congress, it remains unclear how the
shortfall would be restored. Housing authorities may not know the
final amount of HUD subsidy they will receive for next year until
May or June. Although the Senate just passed an appropriations bill
for the current federal year, it still must be reconciled with
the House bill, and action has not yet been taken on
next year’s budget.
Most public housing developments are more than 35
years old and are in need of ongoing capital replacements, say both
housing authority directors. Operating costs such as utilities and
property insurance continue to rise.
Despite the fact that funding for public housing has
been under stress for years, public housing developments in the
Northwest have been managed well and represent community assets
worth billions of dollars.
Housing authorities rely on the HUD subsidy for 60
percent of the cost of operating public housing. The balance of
their budgets comes from rents from tenants who pay 30 percent of
their incomes. Because the average income of a public housing tenant
is less than $12,000 per year, housing authorities cannot raise
rents because residents, often working in minimum wage jobs, simply
can’t afford to pay more.
Do these possible cuts mean that residents of SHA are facing the loss of their housing? No, at least not in the
immediate future. But maintenance cutbacks, layoffs and the loss of
important services to residents could be a result. The housing
authority is committed to doing its best to keep serving our current residents.
Supporters of public housing have
been diligent in letting HUD, Congress and the President know that
on-going subsidy is important. Several members of Washington's
Congressional delegation have urged full funding of the HUD budget.
These include Rep. Jim McDermott, Senator Maria Cantwell and Rep.
Adam Smith. Also, Seattle's City Council, with the support of Mayor
Greg Nickels, has passed a resolution asking appropriators to
reconsider their proposed actions. Councilmember Nick Licata has
agreed to push for additional support. Gov. Gary Locke has also
spoken out on the issue.
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