HUD, Let’s Talk

4 min read

Happy 50th birthday as a Cabinet agency, HUD!

When you took your seat at the President’s table back in 1965, issues of race and equality were on the front pages daily, and the challenges facing American cities had become a priority. One of your first Secretaries, George Romney, embodied the spirit that you could tackle those challenges. He championed desegregation and a strong urban policy emphasizing region-wide solutions.

But soon that zeal cooled, and later calls to rein in or even eliminate you, HUD, became a feature of Washington life, with the cyclical regularity almost equal to Haley’s Comet (but more frequent.) Most of your funds for creating new affordable housing were cut back or eliminated in the 1980s. Congress started down the path to eliminate you altogether in the 1990s, which prompted your “reinvention” by the Clinton Administration.

By the 2000s, with few development tools left at your disposal, your job description had changed. You became mostly an asset manager of an existing Section 8 and public housing portfolio, manager of the FHA, and a workout specialist for troubled deals. Most of the limited new funds flowing into affordable housing were generated through the Low Income Housing Tax Credit—run by your much older brother, Treasury.

By 2012, the younger candidate Romney could speculate about abolishing you—which drew applause from conservative commentators. This was a significant shift from the days when Jack Kemp eloquently defended you, saying that despite advice from ‘’both the right and left’’ to abolish HUD because critics “believe a laissez-faire marketplace” is the answer, his view was different: ‘’I think they are wrong. I won’t take a back seat to anyone in recognizing that the private sector, free markets, capitalism and economic freedom are the cornerstone of America’s prosperity. But in a society that believes in traditional Jewish and Christian principles of compassion and concern, we need both a social safety net below which no one can fall and a ladder of opportunity on which everyone can climb.“

So how are you doing these days, HUD, as we head into another Presidential election cycle with a high likelihood that someone will remember to put you on their list of agencies to eliminate?

One key health indicator is how you fared in the budget numbers recently passed by House and the Senate. Overall, not bad for a middle aged agency always suffering a lot of stress, but in a few areas you’re showing signs of trouble.

Most of your programs would be roughly level-funded compared to FY 2015, under the bills adopted by the House and Senate appropriators for FY 2016. But the end of the deal from 2012 that delayed the deepest cuts to non-defense spending mandated by the “sequester” terms of the 2011 Budget Control Act forced some deep cuts – and deep they were to some of your vital organs. A few highlights:

• Tenant Vouchers: The Senate bill chops $352 million from rental voucher renewals off of the level that you estimate is needed to avoid cutting back on families assisted—at a time when rents are rising rapidly. And the House cut over $200 million more!
• Public Housing: The Senate cut public housing capital funds by $132 million, and the House cut this funding by nearly $300 million, despite public housing’s $26 billion repair backlog.
• HOME Program: And as an ongoing sign of the diminishing role of HUD in developing new affordable housing and helping many cities address their needs, the Senate cut the HOME program by 93%. In this area, the House was relatively benign with a cut of only $133 million. All this follows prior cuts in HOME funding levels from $1.8 billion to $900 million last year.
• Choice Neighborhoods: Against the backdrop of events of the past year highlighting ongoing lack of opportunity in many low income urban communities, your Choice Neighborhoods approach is cut back by $15 million (Sensate) to as much as $60 million (or 75% by the House).

You’ll survive another year, HUD, but your long-term prognosis is cloudy. The front pages still carry many headlines highlighting issues of race and equality, eerily echoing the era that birthed you. Perhaps we need to reinvigorate you, to help the nation address those issues. But the old is not in favor in Washington these days, and you are just not “disruptive” enough to catch the imagination. If only you could invent an app to make housing affordable….

David M. Abromowitz is a nationally known affordable housing attorney at Goulston & Storrs.