The Federal Budget and Appropriations Process
Enterprise supports affordable housing and community development programs by advocating for increased federal resources through the budget and appropriations process. Below is a list of Enterprise’s Appropriations Priorities for Fiscal Year 2016. For more information on program funding, check out Enterprise’s FY 2016 budget chart.
Increasing Funding for Affordable Housing and Community Development Programs
Enterprise urges Congress to end strict budget caps and sequestration and for further investment in affordable housing and community development.
Spending cuts and chronic underfunding have had a direct, negative impact on low-income families and their ability to access affordable housing. Studies show that low-income residents are facing rent increases, developers are producing fewer affordable units, public housing agencies have stopped issuing housing vouchers, and community development organizations are offering fewer services.
Sequestration and chronic underfunding put our nation’s long-standing investment in affordable housing and community development at risk. For this reason, Enterprise has joined a broad and diverse range of organizations to call for an end to strict budget caps and sequestration.
Enterprise serves on the Steering Committee of the Campaign for Housing and Community Development Funding (CHCDF), an education, strategy, and action hub for national organizations dedicated to adequate federal housing and community development funding for lower-income families and communities. Find more information on CHCDF here.
Enterprise also participates with Non-Defense Discretionary United (NDD United), a coalition of leaders joining forces in an effort to save public services from devastating budget cuts. NDD programs are core services government provides for the benefit of everyone - including housing and community development, medical research, public health, infrastructure and education. For more information, please visit the NDD United website.
Section 4 Capacity Building for Community Development and Affordable Housing (Section 4)
The Section 4 Capacity Building for Community Development and Affordable Housing program (Section 4) is the sole HUD program for non-profit capacity building. Section 4 creates jobs, supports small businesses, builds housing, and strengthens communities. From 2004 to 2014, Section 4 created or preserved over 95,000 homes and attracted over $15.7 billion in investment for lower-income neighborhoods and communities across the country. Since 1993, Enterprise has distributed over $125 million to more than 1,250 community development organizations throughout the country through the Section 4 program.
Every Section 4 dollar must be matched directly by $3 of private funding for capacity building. Since 2002, Section 4 grantees’ development projects have exceeded this requirement by attracting nearly $27 in other public and private investment for every dollar in Section 4 support.
Enterprise urges Congress to provide funding of at least $35 million for Section 4.
Despite the program’s success, the Obama Administration’s FY 2016 budget proposes to eliminate Section 4. This proposal jeopardizes crucial investments across the United States. Restoring Section 4 to at least $35 million, its current level of funding, will have a significant impact on the communities that the program supports.
Project-Based Section 8 Rental Assistance (PBRA)
The Project-Based Section 8 Rental Assistance (PBRA) program provides affordable homes for roughly 1.2 million low-income households. Through contracts with owners of privately owned multifamily rental housing, PBRA makes rents affordable while bringing a steady stream of capital into properties, enabling them to leverage private dollars to maintain and improve the properties.
The PBRA portfolio leverages more than $17 billion in private financing and equity to support the properties in which it is located. Each year, the program also generates $460 million in property taxes for local municipalities and supports 100,000 jobs.
The amount of PBRA funding each owner receives is the difference between what a household can afford (generally 30 percent of income) and the approved rent for the apartment. Most PBRA households are either low-income seniors (47 percent) or people with disabilities (33 percent), who are often on fixed incomes that are insufficient to cover rent in the private market.
Enterprise urges Congress to fully fund PBRA at $10.76 billion and to renew all existing contracts for a full year.
Since FY 2012, HUD has provided less than 12 months of funding, or “short-funded,” a substantial share of PBRA contracts, due to reduced PBRA funding levels compounded by sequestration. Short-funding discourages private investment, defers program costs, and increases risks and costs for owners, lenders, and investors.
HOME Investment Partnerships (HOME)
The HOME Investment Partnerships (HOME) program is the largest federal block grant to state and local governments to create affordable homes for low-income families. Since 1992, the HOME program has financed the construction of nearly 1.2 million affordable homes and made homes affordable for another 283,000 families through resident-based rental assistance.
HOME funds provide critical gap financing that make affordable housing developments feasible. Nearly a quarter of HOME funds support Low-Income Housing Tax Credit developments, and the remainder are used in conjunction with a variety of other housing programs. The HOME program has demonstrated a leverage ratio that far exceeds the minimum requirements of 25 cents per dollar – each dollar of HOME actually leverages another $4.16 of other funds. Since its inception, HOME has leveraged more than $115.5 billion for affordable housing development.
Enterprise urges Congress to fully fund the HOME Program at $1.2 billion in FY 2016. The HOME program has been cut significantly in recent years, from roughly $2 billion to less than $1 billion. Fully funding the HOME program would help states and localities ensure that the most critical developments can obtain the necessary financing.
Enterprise actively participates in the HOME Coalition to help increase awareness of the HOME program, its importance to the development and provision of affordable housing, and the need for funding. Visit the HOME Coalition website for more information. To sign up for HOME Action Alerts, please click here.
Section 8 Housing Choice Voucher (HCV)
The Section 8 Housing Choice Voucher (HCV) program makes rental housing in the private market affordable to 2.2 million extremely and very low-income households. Like PBRA, HCV contracts cover the difference between the amount that these low-income households can afford to pay in rent and fair market rents. More than 75 percent of the families receiving HCVs are extremely low-income, meaning they have incomes at or below 30 percent of area median income.
Enterprise urges Congress to renew all HCVs in use in 2015 and restore all HCVs lost due to sequestration.
As a result of sequestration, public housing agencies are assisting approximately 100,000 fewer families with HCVs than they were in 2012. Enterprise supports the Obama Administration’s FY 2016 request for HCV contract renewals, which would restore approximately 67,000 vouchers and target 30,000 vouchers to families with children and others in immediate need of a stable home, including homeless veterans and victims of domestic violence.
Enterprise advocates with the Housing Choice Voucher Funding Project for full funding for all Housing Choice Voucher renewals in FY 2016. The HCVFP also aims to restore the 67,000 vouchers lost to sequestration in 2013 and to promote a targeted voucher proposal that would provide more housing options for homeless families and other vulnerable groups. For more information on the HCV program and rental assistance, click here to visit the Center on Budget and Policy Priorities.
In addition, Enterprise is a member of the Preservation Working Group (PWG), which is dedicated to the preservation and development of federally assisted multifamily affordable housing. For more information on the Preservation Working Group, please visit the PWG webpage.