"The Most Unkindest Cut of All": What Sequestration Could Mean for Affordable Housing

Image Credit: RAND Corporation 

In the days and hours before the indiscriminate spending cuts known as the sequester are set to go into effect on March 1, much media attention has been given to sequestration's effects on the defense industry, education, and everyday services such as air traffic controlling. Regarding social services, national dialogue is quick to point out that programs like TANF and Medicaid will be left mostly untouched if the cuts do indeed come into effect, but such assertions seem to entirely miss the point that the bundle of services that provide much-needed help to low-income Americans goes far beyond the few largest entitlement programs. Affordable housing initiatives will be hit hard by the sequester but, thus far, coverage has been drowned out by the popping champagne corks accompanying the announcements of a rebounding real estate market. However, as early as this past September, the National Affordable Housing Management Association (NAHMA) issued a cautionary fact sheet detailing the estimated $2.8 billion in cuts to HUD and and USDA programs that serve low-income tenants and craft affordable housing policies in the U.S. Such programs include Section 8 projects and vouchers; elderly housing (Section 202), disabled housing (Section 811); the Community Development Fund; rural rental insurance; homelessness assistance; and HUD's innovative Choice Neighborhoods Initiative. As expected, the cuts would indiscriminately inflict hardship on urban, suburban, and rural residents who rely on these programs to survive and thrive in vibrant communities. In the District of Columbia, where nearly 97% of affordable housing funds come from the federal government, a reduction in funding would hamper the D.C. Housing Authority's ability to provide assistance to the many families who are waiting for affordable units in a city that has already seen reduced government investment in housing initiatives since 2007.

Image Credit: Novogradac & Company, LLP 

Beyond the Beltway, housing officials worry that, in addition to jeopardizing the assistance of residents in need of affordable housing options, sequestration would lead to a declining maintenance and repairs of affordable housing facilities and would have a negative impact on the ability of public housing and redevelopment authorities to form partnerships with private foundations and developers and plan mixed-income projects. In a letter directed to a bipartisan group of congressional leaders, the executive directors of the Council of Large Public Housing Authorities, National Association of Housing and Redevelopment Authorities, and Public Housing Authorities Directors Association warned leaders of the dire consequences of sequestration on public housing and related programs and urged Congress to avoid the sequester and seek alternative deficit reduction measures.

The huge reduction to funding for affordable housing is a blow that could prevent society's most vulnerable residents from securing the basic human need of housing and the American dream of quality, safe, affordable housing. The sequester will take away vital resources from necessary affordable housing initiatives and must be avoided in order to plan for future affordable housing successes. Indiscriminate budget gutting must be rejected in favor of, as the public housing directors implored Congress, more responsible and nuanced efforts to reduce the deficit. With less than 48 hours left until the deadline, affordable housing advocates (this blogger included) wait with bated breath, rattled nerves, and the firm hope that these across-the-board spending cuts do not come to pass.