House Passes Spending Bill With $9B Increase for Local Housing Initiatives

As home and rent prices rise rapidly around the country, House Democrats on Wednesday approved a measure calling for a $9 billion increase in federal spending on housing.

The $405 billion spending bill for the Department of Housing and Urban Development and several other federal agencies passed in a partisan 220-207 vote. However, the approval is only the opening bid in the House’s negotiations with the Senate and the White House. 

The bill gives HUD $1.1 billion more than what President Biden proposed in his budget request in March. But with the Senate evenly divided between Democrats and Republicans, budget negotiations over the next few months are expected to whittle down the $62.7 billion the House wants to give HUD. 

“The bill, as written, is just spending too much,” said Rep. Mario Diaz-Balart of Florida, the top Republican on the committee, when the panel advanced the spending proposal to the full House last month.

House Republicans on Tuesday unsuccessfully tried to amend the portion of the bill dealing with housing and transportation funding by a third. But the proposal was opposed by Rep. David Price of North Carolina, the top Democrat on the appropriations subcommittee on housing, transportation and urban development. 

“It would indiscriminately make cuts,” he said on the House floor.

The Democrats’ proposal, Price said, would make “critical new investments,” including more than 140,000 vouchers for low-income families and people experiencing or at risk of homelessness. He added that it also would create more than 5,600 affordable housing units for seniors and persons with disabilities, and provide more than 6,700 new vouchers for veterans experiencing homelessness and for youth aging out of foster care.

Cities and Advocates Applaud Bill

Despite the uncertainty ahead, the House bill was hailed by groups representing states, cities and low-income housing groups because it would increase spending on an array of housing programs. Besides addressing homelessness, it would provide additional rental assistance and increase the nation’s main affordable housing grant program, the HOME Investment Partnerships Program, to its highest level in a decade. 

The House bill also increases funding that could go to states to house the elderly, disabled and people with AIDS.

“It’s a very good bill. It's a significant increase overall in the programs that are going to increase housing supply,” Stockton Williams, executive director of the National Council of State Housing Agencies, said in an interview. 

Diane Yentel, president and CEO of the National Low Income Housing Coalition, agreed in a statement to Route Fifty.

“As rents soar, evictions rise and homelessness increases, the House [bill] … includes a significant and critically needed increase in funding for HUD’s affordable housing and homelessness programs,” she said.

However, Michael Wallace, the National League of Cities’ program director for community and economic development, lamented in an interview that the $9 billion in proposed spending increases will not bring the transformational changes for housing Democrats proposed in the $1.7 trillion Build Back Better bill. The proposal initially included $170 billion for housing, but Senate Democrats slashed the funds to win the support of moderate West Virginia Democratic Sen. Joe Manchin. 

More Aid for Low-income Residents

The increases proposed by the House would provide cities with more aid for residents dealing with inflation and rising housing prices, Wallace said. “Inflationary pressures hit low-income people the hardest because they don’t have the disposable income to be able to deal with it,” he said.

“But as happy as we are with the increase in funding that’s being proposed, significant housing needs aren’t going to be addressed,” he said.

Wallace, however, noted another boost in the bill is billions of dollars of other earmarks. 

The House’s spending measure includes  funding for more than 1,800 local transportation and urban development projects requested by 331 House members from both parties, Rep. Rosa DeLauro, a Connecticut Democrat, said at last month’s committee hearing. 

Among them, according to budget documents, are $1.9 billion for community economic development projects, $267.4 million for public transit and $1.2 billion for highway infrastructure projects.

“Gosh, what if we had done this for the previous ten years, Just think of the huge difference we could have been making back home for all of those years,” said Rep. Cheryl Bustos, a Democrat from Illinois. Bustos scored funding for several projects including $500,000 to demolish a “worn down” building in Astoria, Illinois, that will help clear the way for economic development in the area.

The bill also calls for increasing transportation spending by $2.4 billion, to $105.4 billion. Much of that money is in the infrastructure law, including raising spending for the Highway Trust Fund by $1.3 billion to $58.7 billion.

Meanwhile, the House proposal would maintain funding for Rebuilding American Infrastructure with Sustainability and Equity–RAISE–discretionary grants, formerly known as BUILD and TIGER, at $775 million. However, that does not include the $1.5 billion in infrastructure act grants the Department of Transportation will make available in January for the next fiscal year.

The proposal would also, among other things, quadruple funding (from $25 million to $100 million) of the Thriving Communities Initiative. The program pays for helping “communities with persistent barriers” developing plans to be better able to compete for federal grants, the House budget document said. Biden wanted more, though, proposing to increase the program’s funding to $110.7 million.

Proposal Keeps 'Roofs Over Heads’

The budget debate comes at a time when rising prices have struck a blow to Biden’s popularity and pose a significant problem for Democrats in the midterm elections in November.

DeLauro, speaking on the House floor on Tuesday, said the bill would “reach some of our most vulnerable Americans by funding the programs that keep roofs over the heads of millions.”

A key for state and local governments would be an increase in the HOME Investment Partnerships Program, the largest federal affordable housing block grant program, from $1.5 billion to $1.7 billion, which the National Council of State Housing Agencies said would be the highest level of funding in a decade. However, the increase would not be as much as the $1.95 billion Biden wanted for the program, according to a NCSHA comparison of the budget proposals. 

The House bill extends greater increases in housing funding than Biden asked for, but it does not go far in some programs. 

Though Biden called for an increase in Community Development Block Grant funding, from $3.3 billion to $3.8 billion, the House maintained the amount of funding at current levels. The House also did not include a proposal by the president to steer $195 million in CDBG funds to the nation’s 100 most impoverished neighborhoods.

While that’s a disappointment for cities, Wallace said the House proposal would allow localities to use more CDBG funds to provide services, and spend more grant funds on rental assistance.

The proposal would also increase funding, from $27.3 billion to $31 billion, for housing choice vouchers that are used by low-income families to rent homes.

In addition, the House bill would bump up funding for the Choice Neighborhoods Initiative by $100 million to $450 million. Biden had called for trimming the program, which helps communities revitalize distressed neighborhoods and improve public housing, to $250 million, according to the NCSHA analysis.

Among other increases proposed by the House is a boost in homeless assistance programs, from $3.2 billion to $3.6 billion, essentially the same as Biden called for. 

The House would also increase funding for housing programs for the elderly from $1 billion to $1.2 billion, even though Biden wanted to slightly decrease funding to $966 million.

Other Funds for Housing

The House bill also calls for increasing housing funding for people with disabilities, from $352 million to $400 million, ignoring Biden’s proposal to reduce funding for the housing to $288 million. Housing programs for people with AIDS would rise from $450 million to $600 million, higher than Biden’s $455 million proposal.

The House, however, did not include Biden’s plan to create a $35 billion Housing Supply Fund for state and local affordable housing grants. Compared to federal housing tax credits, the grants, Wallace said in March, would allow cities to not be as dependent on where developers want to build units.