The Department of Housing and Urban Development: FY2009 Appropriations

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President Bush’s FY2009 budget requested $39 billion for the Department of Housing and Urban
Development (HUD), an increase of 4% in net budget authority from the FY2008 non-emergency
level. That increase in net budget authority is largely attributable to a decline in the amount
available to offset the HUD budget. The President’s budget request would result in an overall
decline in appropriations for HUD’s programs and activities of just over 1% from the FY2008
level.
Despite the request for an overall decline in appropriations for HUD’s programs and activities,
the President’s FY2009 budget did request increased appropriations in several areas, including
project-based Section 8 rental assistance, the HOME Investment Partnerships block grant
program, and Homeless Assistance grants. The President’s FY2009 budget requested reductions
in funding for several programs, including the Section 202 Housing for the Elderly program and
the Section 811 Housing for the Disabled program. It proposed eliminating funding for several
programs that were funded in FY2008, including the HOPE VI public housing revitalization
program, the Brownfields Redevelopment program, Section 108 loan guarantees, and the Rural
Housing and Economic Development block grant program. The President also requested no new
funding for each of these programs in his FY2004-FY2008 budget requests, although Congress
continued to fund them in each of those years.
On June 20, 2008, the Transportation-HUD Subcommittee of the House Committee on
Appropriations approved a draft FY2009 Transportation-HUD appropriations bill. On July 9,
2008, the Transportation-HUD Subcommittee of the Senate Committee on Appropriations
approved its version of the FY2009 Transportation-HUD appropriations bill; the bill was
approved the following day (July 10, 2008) by the Senate Committee on Appropriations (S.
3261). On September 30, 2009, the President signed a continuing resolution funding most
government agencies, including HUD, at their FY2008 levels through March 6, 2009 (P.L. 110-
329). The CR also provided $150 million in emergency supplemental assisted housing funds for
use in areas affected by the 2005 hurricanes and $6.5 billion in emergency supplemental CDBG
funding to be used to respond to presidentially declared disasters taking place in 2008.
The FY2009 appropriations legislation was not enacted before the close of the 110^th Congress and ^th
the end of the Bush Administration. The 111 Congress is expected to consider legislation to
provide appropriations for the remainder of FY2009 sometime before the expiration of the ^th
continuing resolution (March 6, 2009). The 111 Congress may also consider economic stimulus
legislation that may provide emergency funding to select HUD accounts.
This report will be updated to track legislative activity.

Deve lopments .................................................................................................................................. 1
President’s Budget and the Budget Resolution.........................................................................1
House and Senate Consideration...............................................................................................1
Continuing Resolution, Emergency Funding and Stimulus Proposals......................................2
Introduction to the Department of Housing and Urban Development (HUD)................................3
Overview and Recent Trends in HUD Funding...............................................................................4
FY2009 Appropriations...................................................................................................................6
Accounts .................................................................................................................................... 9
Tenant-Based Rental Assistance (Section 8 Vouchers).......................................................9
Project-Based Section 8 Rental Assistance.......................................................................15
Public Housing..................................................................................................................18
Native American Housing Block Grants...........................................................................21
Housing for Persons with AIDS (HOPWA)......................................................................21
Office of Rural Housing and Economic Development (RHED).......................................22
Community Development Fund/Block Grants.................................................................23
CDBG Section 108 Loan Guarantees...............................................................................25
Brownfields Economic Development Initiative................................................................25
The HOME Investment Partnership Program...................................................................26
Self-Help and Assisted Homeownership Opportunity Program.......................................27
Homeless Programs..........................................................................................................29
Housing Programs for the Elderly and Persons with Disabilities.....................................30
Federal Housing Administration.......................................................................................33
Government National Mortgage Association (Ginnie Mae).............................................34
Research and Technology.................................................................................................35
Fair Housing.....................................................................................................................36
Lead-Based Paint Hazard Reduction................................................................................37
Office of Federal Housing Enterprise Oversight (OFHEO).............................................38
Figure 1. HUD Funding, FY2002-FY2008.....................................................................................5
Figure 2. Funding for Section 8 as a Percentage of Total HUD Appropriations, FY2002
and FY2008..................................................................................................................................6
Figure 3. FHA Offsetting Receipts, FY2002-FY2008.....................................................................6
Figure 4. Illustration of Project-Based Contract Partial Funding.................................................17
Table 1. Department of Housing and Urban Development Appropriations, FY2004-
FY2008 ......................................................................................................................................... 3
Table 2. Appropriations: Housing and Urban Development, FY2008-FY2009..............................7
Table 3. Section 8 Tenant-Based Rental Assistance (Vouchers), FY2008-FY2009......................10

Table 4. Section 8 Project-Based Rental Assistance, FY2008-FY2009.......................................16
Table 5. Public Housing, FY2008-FY2009...................................................................................19
Table 6. Native American Block Grants, FY2008-FY2009..........................................................21
Table 7. HOPWA, FY2008-FY2009.............................................................................................22
Table 8. Rural Housing and Economic Development, FY2008-FY2009....................................22
Table 9. Community Development Fund (CDF): Community Development Block Grants
(CDBG) and Related Set-Asides, FY2008-FY2009.................................................................23
Table 10. CDBG Section 108 Loan Guarantees, FY2008-FY2009...............................................25
Table 11. Brownfields Redevelopment, FY2008-FY2009............................................................26
Table 12. The HOME Investment Partnership Program, FY2008-FY2009.................................26
Table 13. Self Help Homeownership Opportunities, FY2008-FY2009.......................................28
Table 14. HUD Homeless Programs, FY2008-FY2009................................................................29
Table 15. Sections 202 and 811, FY2008-FY2009........................................................................31
Table 16. Federal Housing Administration, FY2008-FY2009......................................................33
Table 17. Government National Mortgage Association, FY2008-FY2009..................................35
Table 18. Research and Technology, FY2008-FY2009.................................................................36
Table 19. Fair Housing Programs, FY2008-FY2009.....................................................................37
Table 20. Lead-Based Paint Hazard Control, FY2008-FY2009....................................................38
Author Contact Information..........................................................................................................38

On February 4, 2008, President Bush sent his FY2009 budget to Congress. It included $39
billion for the Department of Housing and Urban Development (HUD).
On June 4, 2008, the Senate passed the FY2009 budget resolution conference agreement
(H.Rept. 110-659); the House passed it the following day. The budget resolution is used to
establish the amount of funding each appropriations subcommittee will have available to allocate.
The budget resolution cannot generally be used for determining congressional funding levels for ¹
any specific program.
On June 20, 2008, the Transportation-HUD subcommittee of the House Committee on
Appropriations approved a draft FY2009 HUD appropriations bill by voice vote. According to a
press release issued by the subcommittee, the draft bill included the following:
• $110 million for new incremental vouchers: $75 million to fund 10,000 new
housing vouchers for homeless veterans and $30 million for 4,000 new housing
vouchers for the disabled;
• $75 million for foreclosure counseling and assistance to assist more than 200,000
families at risk of losing their homes;
• $1.69 billion for Homeless Assistance Grants ($55 million above the President’s
request);
• $4 billion for Community Development Block Grants ($1 billion above the
President’s request);
• $765 million for housing for the elderly ($225 million above the Administration’s
request) and $250 million for disabled housing ($90 million above the President’s
request); and
• $4.5 billion for the public housing operating account, $2.5 billion for the public
housing capital account, and $120 million for HOPE VI (combined, $896 million
more than the Presidents’ request for the public housing accounts).
(Note: The remainder of this report is not updated to reflect House subcommittee action. It will be
updated if and when the legislation becomes publicly available.)
On July 10, 2008, the Senate Committee on Appropriations approved its version of the FY2009
Transportation-HUD appropriations bill, following subcommittee approval the previous day (S.

3261).

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On September 30, 2008, the President signed a continuing resolution funding most government
agencies—including HUD—at their FY2008 levels (P.L. 110-329). The CR was included as
Division A of a larger bill that also included supplemental emergency funding (Division B) and
the Defense, Homeland Security, and Military Construction/Veterans Administration FY2009
full-year appropriations acts (Divisions C-E). It was attached to the FY2008 Homeland Security
bill (H.R. 2638) and passed by the House on September 24, 2008, and the Senate on September

27, 2008.

The CR funds agencies through the earlier of March 6, 2009, or enactment of a final FY2009
funding bill. The CR includes several additional provisions related to HUD. Specifically, it
authorizes the Secretary to spend funds at a faster rate in order to ensure the timely renewal of
project-based Section 8 contracts, extends the authorization for the HOPE VI program, raises the
loan commitment levels for the Federal Housing Administration’s (FHA) mortgage insurance
programs, and allows HUD to use salaries and expenses funding to meet FHA’s technology needs.
Division B of the act, which includes emergency disaster funding, provides $85 million to
provide new Section 8 vouchers to households affected by the 2005 hurricanes, $50 million in
new project-based Section 8 vouchers to be used in areas affected by the 2005 hurricanes, $15
million to redevelop public housing developments damaged by the 2005 hurricanes, and $6.5
billion in Community Development Block Grant (CDBG) funding for communities affected by
presidentially declared disasters declared in 2008.
On January 15, 2009, the House Appropriations Committee released a draft economic stimulus
plan. It includes emergency funding for several HUD accounts, as listed below:
• $5 billion for the Public Housing Capital Fund;
• $2.5 billion to be used to make energy efficiency modifications to project-based
Section 8, Section 202, and Section 811 assisted properties;
• $1.5 billion for the HOME Investements Partnership Program;
• $500 million for the Native American Housing Block Grants account;
• $5.2 billion for the Community Development Fund account, $4.2 billion of which
is for the Neighborhood Stabilization Grant program and $1 billion of which is
for the Community Development Block Grant program;
• $1.5 billion for the Emergency Shelter Grant program;
• $10 million for the Self-Help and Assisted Homeownership account;
• $100 million for the Lead Hazard Control account.

Most of the funding for the activities of the Department of Housing and Urban Development
(HUD) comes from discretionary appropriations provided each year in the annual appropriations
acts enacted by Congress. HUD’s programs are primarily designed to address housing problems
faced by households with very low incomes or other special housing needs. These include several
programs of rental assistance for the poor, elderly, and/or disabled. Three rental assistance
programs—Public Housing, Section 8 Vouchers, and Section 8 project-based rental assistance—
account for the majority of the Department’s non-emergency funding (more than 75% in
FY2008). Two flexible block grant programs, HOME and Community Development Block
Grants, help communities finance a variety of housing and community development activities
designed to serve low-income families. Other, more specialized, block grants help communities
meet the needs of homeless persons, including those with AIDS. In recent years, HUD has also
focused more attention on efforts to increase the homeownership rates for lower-income and
minority households, with programs providing funding for downpayment assistance and housing
counseling.
HUD’s Federal Housing Administration (FHA) insures mortgages made by lenders to lower-
income home buyers, many with below-average credit records, and to developers of multifamily
rental buildings containing relatively affordable units. FHA collects fees from insured borrowers,
which are used to sustain the insurance fund and offset its administrative costs. Surplus FHA
funds have been used to offset the cost of the HUD budget.
Table 1 presents total enacted appropriations for HUD over the past five years, including
emergency appropriations.
Table 1. Department of Housing and
Urban Development Appropriations, FY2004-FY2008
^{(net budget authority in billio}^ns)
^FY20^{04 FY20}^{05 FY20}⁰⁶^FY20^{07 FY20}⁰⁸
^31.2^{0 31.9}²^50.6⁸^a^36.6³^47.5⁹^b
^Source:^{Figures a}^{re taken}^{from t}^{ables produced}^{by t}^{he House}^Ap^{propriations Committee. Final appropriations levels}
^{for any fiscal year}^{include all sup}^p^{lemental approp}^{riations or rescis}^{sions. They do not reflect revised}^{estimates of}
^{offsetting receipts.}
^a.^{Figure includes $}^17.1^{billion ($11.9 billion in P.L. 109-14}^{8 a}^{nd $5.2}^billi^{on in P.L. 109-2}^{34) in e}^merge^ncy
^sup^{plemental ap}^{propriations e}^nac^{ted in respons}^{e to the}²⁰⁰⁵^hu^rri^{canes. Regular FY20}⁰⁶^HUD
^approp^{riations totaled just under}^$3^{3.6 billion.}
^b.^{Figure includes $}³^{billion (P.L. 110-11}^{6) in emerg}^ency^su^ppleme^nt^{al funding for Lo}^{uisiana in res}^pon^{se to the}
²⁰⁰⁵^hur^{ricanes a}^{nd $}^{6.95 (P.L. 1}^10-2^{52 a}^{nd P.L. 11}^0-32^{9) billion i}ⁿ^emerge^{ncy s}^u^p^{plemental f}^undin^{g for}
²⁰⁰^{8 disasters. Regular FY2}⁰⁰^{8 a}^pprop^{riations totaled $37.64}^billi^on.

HUD’s annual funding, or budget authority, is made up of several components, including regular ²
annual appropriations, emergency appropriations, rescissions, and offsets.
HUD’s programs and activities are funded almost entirely through regular annual appropriations, ³
also referred to as discretionary appropriations. As a result, the amount provided in the annual
appropriations acts each year generally determines how much will be obligated and eventually
spent for each of HUD’s programs and activities.
In some years, Congress will also provide emergency appropriations, generally in response to
disasters, through one or more of HUD’s programs. These funds are generally provided outside of
the regular appropriations acts—often in emergency supplemental spending bills—and are
generally provided in addition to regular program level funding.
Congressional appropriators are generally subject to limits in the amount of new, non-emergency,
discretionary appropriations they can provide in a year. One way to stay within these limits is to
provide less in regular annual appropriations. Another way to stay within these limits is to find
offsets for spending. A portion of the cost of HUD’s regular annual appropriations acts is
generally offset in two ways. The first is through rescissions or cancellations of unobligated or
recaptured balances from previous years’ funding. The second is through offsetting receipts and
collections, generally derived from fees paid by HUD partners or clients.
The interaction between new appropriations and offsets provided through rescissions, receipts,
and collections, determines HUD’s total budget authority. Budget authority is also the “cost” of ⁴
the HUD budget, as estimated by the Congressional Budget Office in its scorekeeping process.
The total amount of budget authority provided to HUD each year, while important for federal
budgeting purposes, is not necessarily the best measure of the amount of funding that is being
provided for HUD’s programs and activities.
For example, if Congress has increased appropriations for HUD’s programs and activities at the
same time that offsetting receipts are increasing by a greater amount, then HUD’s total budget
authority may appear to be declining. Conversely, if Congress has reduced appropriations for
HUD’s programs and activities at the same time that offsetting receipts are declining by a greater
amount, then HUD’s budget authority may appear to be increasing. If Congress wished to
maintain level budget authority for HUD programs, Congress would increase appropriations if
offsets are declining (or, provide less appropriations if offsets are increasing).

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As shown by the line in Figure 1. , total non-emergency budget authority for HUD increased
28% between FY2002-FY2008, from over $29 billion to just under $38 billion. However, the
increase in total budget authority masks several important trends.
From FY2002 to FY2008, regular annual appropriations, which is the amount available to fund
HUD’s programs and activities, grew by 20%. During the same period, the amount available in
offsetting receipts and collections, which Congress uses to reduce the cost of providing new
appropriations, declined by more than 65% (see Figure 1). As a result, the increase in total non-
emergency budget authority for HUD from FY2002-FY2008 is not fully attributable to increases
in appropriations for HUD’s programs and activities; rather, part of the increase in total budget
authority is attributable to decreases in the amount available in offsetting receipts.
For example, in FY2007, Congress provided $39 billion in regular appropriations for HUD’s
programs and activities. Since $3 billion was available from offsets and rescissions, HUD’s total
budget authority was $36 billion. If less had been available in offsets, the cost to Congress of
providing $39 billion in regular appropriations would have been higher.
Figure 1. HUD Funding, FY2002-FY2008
^E^m^e^r^g^e^nc^y
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^Source:^Chart^pre^pared^{by CRS on the}^{basis of an}^{nual ap}^prop^{riations documents.}
The increase in regular (non-emergency) appropriations shown in Figure 1. (from just over $35
billion in FY2002 to over $40 billion in FY2008) is largely attributable to the growth in
appropriations for the project-based and tenant-based Section 8 program. From FY2002-FY2008,
appropriations for Section 8 grew by more than 40%; appropriations for all other programs and
activities during that period declined by about 4%. As can be seen in Figure 2, appropriations for
the Section 8 program have grown from about 45% of HUD’s regular appropriations in FY2002
to about 55% of HUD’s regular appropriations in FY2008.

Figure 2. Funding for Section 8 as a Percentage of Total HUD Appropriations,
FY2002 and FY2008
^Source:^Chart^pre^pared^{by CRS on the}^{basis of an}^{nual ap}^prop^{riations documents.}
The large decline in offsetting receipts over this period is largely attributable to declines in excess
receipts in the Federal Housing Administration’s (FHA) mortgage insurance programs (discussed
later in this report). As shown in Figure 3, from the peak (in FY2004) to the lowest point (in
FY2008), the amount of offsetting receipts available from the FHA mortgage insurance program
declined by 92%.
Figure 3. FHA Offsetting Receipts, FY2002-FY2008
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Table 2 presents the President’s FY2009 budget request for HUD compared to the prior year’s
enacted budget authority and the congressional response. Four totals are given in Table 2:
“budget authority provided” and “available budget authority,” both including and excluding
emergency appropriations. Total budget authority provided includes current year appropriations,
plus advance appropriations provided in the current fiscal year for use in the next fiscal year; total
available budget authority includes current year appropriations, plus advance appropriations

provided in the prior fiscal year for use in the current fiscal year. Congress is scored by CBO for
the amount of available budget authority in an appropriations bill; however, the Appropriations
Committees’ documents often discuss budget authority provided.
The President’s FY2009 Budget requests a less than 4% increase in total, regular (non-
emergency) budget authority for HUD. Following recent trends, the requested increase in budget
authority is largely driven by declines in the amount available for rescission (88% decline from
FY2008) and projected to be available in offsetting receipts (23% decline from FY2008). The
FY2009 request for regular (non-emergency) appropriations—which is the amount available for
HUD’s programs and activities—represents a slight decline (1.4%) from FY2008.
The 110^th Congress adjourned before work on the FY2009 appropriations acts was complete. In
the House, an FY2009 funding bill was marked up in subcommittee, but not reported, and in the
Senate, a bill was reported by committee. Before the end of FY2008, Congress approved a
continuing resolution funding most federal agencies at their FY2008 levels through March 6,

2009. (For an expanded discussion, see “Recent Developments” at the beginning of this report.)

The unreported House subcommittee-passed bill and the continuing resolution are not reflected in
Table 2 or in the remainder of this report.
Table 2. Appropriations: Housing and Urban Development, FY2008-FY2009
^{(budget authority in billions of}^doll^ars)
^FY20⁰⁹
^Acc^ount^FY20⁰⁸^Enacted^FY20⁰⁹^Request^Senate
^Comm.
^Appr^opriations
^Manageme^{nt and Administration}^a^1.21²^1.29⁰^1.30⁴
^{Tenant Based Rental Assistanc}^{e (Sec. 8 vouche}^rs)
^{(includes advance for s}^u^b^seq^uent^year)^16.3⁹¹^15.8⁸¹^16.7⁰³
^{Project Based Rental Assistance (Sec.8)}
^{(includes advance for s}^u^b^seq^uent^year)^6.38²^7.40⁰^8.45⁰
^{Public Housing Capital Fund}^2.43⁹^2.02⁴^2.44⁴
^{Public Housing O}^{perating F}^und^4.20⁰^4.30⁰^4.40⁰
^{HOPE VI}^0.10⁰^0.00⁰^0.10⁰
^{Native American}^{Housing Block Grants}^0.63⁰^0.62⁷^0.65⁰
^{Indian housi}^{ng loan guara}^ntees^0.00⁷^0.00⁹^0.00⁹
^{Native Hawaiian Housing Block}^Grant^0.00⁹^0.00⁶^0.01⁰
^{Native Hawaiian housing loan g}^u^a^rantees^0.00¹^0.00⁰^0.00¹
^{Housing for Person}^{s with AIDS (}^HOPWA)^0.30⁰^0.30⁰^0.31⁵
^{Rural Housing E}^{conomic Development}^0.01⁷^0.00⁰^0.03⁰
^{Community Development F}^{und (}^{including CDBG)}^3.86⁶^3.00⁰^3.88⁹
^{Sec.108 loan gua}^{rantee; s}^u^b^sidy^0.00⁵^0.00⁰^0.00⁶
^{Brownfields redevelopment}^0.01⁰^0.00⁰^0.00⁰
^HOM^{E In}^vestme^{nt Partne}^rships^1.70⁴^a^1.96⁷^a^1.96⁷
^{Self-help Homeownership}^0.06⁰^0.04⁰^0.06⁶

^FY20⁰⁹
^Acc^ount^FY20⁰⁸^Enacted^FY20⁰⁹^Request^Senate
^Comm.
^{Homeless Assistance}^Grant^s^1.58⁶^1.63⁶^1.66⁷
^{Housing for t}^{he Elderly (Sec. 20}²⁾^0.73⁵^0.54⁰^0.76⁵
^{Housing for Person}^{s with Disabilities (Sec. 811)}^0.23⁷^0.16⁰^0.25⁰
^Manu^factu^{red Housing Fees}^Trus^{t Fund}^c^0.01⁶^0.02¹^0.02¹
^{Housing Counseling As}^sistance^b^0.06⁵^b^0.06⁵^b
^{Rental Housing Assistance}^c^0.02⁸^0.02⁸^0.02⁸
^{Research a}^{nd Technology}^0.05¹^0.05⁵^0.06⁰
^{Federal Housing Administration (FHA) Ex}^penses^c^0.16⁹^0.18⁷^0.14⁵
^{Fair housing activities}^0.05⁰^0.05¹^0.05⁶
^{Lead Hazard Reduction}^0.14⁵^0.11⁶^0.20⁰
^{Working capital fund}^0.15⁵^0.22⁴^0.21¹
^Inspe^{ctor Ge}^neral^0.11²^0.11⁵^0.11⁵
^{Office of Federal Housing}^Ente^rp^{rise Oversight}^c^0.06⁶^0.06⁷^0.06⁷
^Appr^{opriations Su}^btotal^40.6⁸³^40.1⁰⁸^43.9⁹⁴
^Rescissions
^{Economic Developments I}^{nitiative rescission}^0.00⁰^-0.180^0.00⁰
^{Rental housing assistan}^{ce rescissi}^on^-0.038^-0.028^-0.038
^{Tenant-Based Rental Assistance (}^{Sec. 8 vouche}^{r) rescission}^-0.723^0.00⁰^-0.800
^{Rescissions Subtotal}^-2.01¹^-0.23³^-0.83⁸
^{Offsetting Collections and}^R^eceipts
^Manu^factu^{red Housing Fees}^Trus^{t Fund}^-0.016^-0.016^-0.016
^{Office of Federal Housing}^Ente^rp^{rise Oversight}^-0.066^-0.067^-0.067
^{FHA -0.250}^-0.140^-0.140
^Governme^{nt National Mortgage}^{Association (GNMA)}^-0.163^-0.170^-0.170
^{Legislative Proposals}^-0.540^-0.407^-0.400
^{Offsets Subtotal}^-^1.03^{5 -0.80}⁰^-0.79³
^{Emergency Fun}^ding
^{Gulf Coast Em}^ergen^{cy p}^{ublic hou}^{sing fu}^nding^0.01⁵^d^0.00⁰^0.00⁰
^{Gulf Coast Em}^ergen^{cy PBRA fun}^ding^0.05⁰^d^0.00⁰^0.00⁰
^{Gulf Coast Em}^ergen^{cy TBRA fun}^ding^0.08⁵^d^0.00⁰^0.00⁰
^{Gulf Coast Em}^ergen^{cy CDBG f}^u^nding^3.00⁰^0.00⁰^0.00⁰
²⁰⁰^{8 Disasters}^Emerg^{ency CDB}^{G Funding}^6.80⁰^d^0.00⁰^0.00⁰
^{Emergency Fun}^{ding Subtotal}^9.95⁰^d^0.00⁰^0.00⁰
^Totals
^{Total Budget Authority Prov}^ided,
^{excluding Emergen}^{cy Ap}^pro^priations^37.6³⁷^39.0⁷⁵^42.3⁶⁴

^FY20⁰⁹
^Acc^ount^FY20⁰⁸^Enacted^FY20⁰⁹^Request^Senate
^Comm.
^{Total Available Budget Authority,}
^{excluding Emergen}^{cy Ap}^pro^priations^37.6⁷²^38.8³³^40.5⁷²
^{Total Budget Authority Prov}^ided,^d
^{including E}^mergency^App^rop^riations^47.5⁸⁷^39.0⁷⁵^42.3⁶⁴
^{Total Available Budget Authority,}^d
^{including E}^mergency^App^rop^riations^47.6²²^38.8³³^40.5⁷²
^Source:^Prepa^{red by CRS on t}^h^e^{basis of tables}^{provided by the}^Approp^{riations Committee, the President’s FY200}⁹
^{Budget documents, HUD Congre}^{ssional Budget Justifications, S. 3261, S.Rept. 110-}⁴¹^{8 and adjusted}^{for emergen}^cy
^funding^{provided by P.L. 11}^0-25^{2, and P.L. 110-}³²^9.
^Notes:^{The Transportation-HUD subcommittee of t}^{he House}^C^{ommittee on Appro}^{priations app}^{roved its version of}
^{the FY20}⁰⁹^{HUD ap}^propriations^{bill on June}^{20, 2}⁰⁰^{8. The s}^ubco^{mmittee has}^{not made the}^{bill pu}^{blicly available at}
^{this time. This table will be updat}^{ed to reflect House action if a}^nd^{when t}^{he legislation becomes ava}^ilable.
^{Total budget authority}^providedⁱⁿ^{cludes advance a}^ppro^{priations pr}^{ovided in the curre}^{nt fiscal year}^f^{or use in t}^he
^subse^que^{nt fiscal year;}^available^b^{udget aut}^{hority includes the adva}^{nce ap}^prop^{riations that were}^pro^{vided in the prior}
^{fiscal year for us}^{e in the}^cu^rrent^f^{iscal year.}
^a.^{Includes f}^unding^{for several ma}^na^{gement, per}^{sonnel, and administr}^{ative accounts, including E}^xec^utive
^{Direction, Administrati}^{on and O}^{perations Ma}^nageme^{nt, and Pers}^{onnel Compensation a}^{nd Benefit}^{s for the}
^{Offices of Pu}^{blic and Indian Ho}^us^{ing, Community Planning and De}^{velopment, Housing, G}^{NMA, Poli}^cy
^{Development and Researc}^{h, Fair Housing and}^Eq^{ual Op}^portu^{nity, Healthy Homes, and L}^{ead Hazard}
^Reduction.
^b.^{Funding for t}^{his account}^{is gener}^{ally offset through}^{collections, receipts, or rescissions shown}^laterⁱⁿ^Table
²^.
^c.^{In FY20}^{08, f}^unding^{for housing}^{counseling assistan}^{ce was}^{provided as a set-aside within the}^HOM^{E a}^ccount;
^{for FY200}^{9, the Pre}^{sident’s budg}^{et req}^{uested that}^fu^{nding for}^hou^{sing counseling assista}^{nce b}^e^pro^{vided in a}
^{separate ac}^count
^d.^$30^{0 million in CDBG disaster assistance was a}^pprop^{riated in FY2}⁰⁰⁸^{by P.L. 1}^10-2⁵²^{for th}^{e Midw}^est
^{floods of 2008 a}^{nd other disaster}^{relief activities. An addit}^{ional $6.5 billion in emergency CDBG}^disaster
^{assistance was a}^ppro^{priated in FY200}^{8 by}^{P.L. 110-}³²^{9 for area}^s^{affected by}^{disasters occu}^{rring in}²⁰⁰^{8. P.L.}
^110-³²^{9 also provided $1}^{50 million in additional ai}^{d for areas affe}^{cted by th}^{e 2}⁰⁰⁵^h^urrica^{nes t}^{hrough t}^he
^{public ho}^{using p}^{rogram ($1}^{5 million), project-based rental assistan}^{ce program (}^$50^million)^{, and ten}^ant-
^{based ren}^{tal assistance}^{program (}^$85^million)^{. None of these}^funds^{(totaling $6.95 billion) were refle}^{cted in}
^{the committees’ estimates of FY2}⁰⁰⁸^enacted^fu^{nding that we}^{re u}^s^{ed to develop this table, which is}^{why the}
^{totals provided do not match those in the committees’ estimates.}
The following section of the report provides a detailed discussion of the majority of accounts
included in Table 2.
The tenant-based rental assistance account funds the Section 8 Housing Choice Voucher program.
(See CRS Report RL32284, An Overview of the Section 8 Housing Programs, by Maggie
McCarty.) Section 8 vouchers are portable rent subsidies that low-income families use to reduce
their housing costs in the private market. HUD currently funds more than 2 million Section 8
vouchers, which are administered at the local level by quasi-governmental Public Housing

Authorities (PHAs). This account—the largest in HUD’s budget—funds the cost of those
vouchers and the cost of administering the program.
Table 3 presents three totals for the Section 8 tenant-based rental assistance account: budget
authority provided; available budget authority, pre-rescission; and available budget authority,
post-rescission. As described earlier, total budget authority provided includes current year
appropriations, plus advance appropriations provided in the current fiscal year for use in the
subsequent fiscal year; available budget authority includes current year appropriations, plus
advance appropriations provided in the prior fiscal year for use in the current fiscal year. In
FY2008, Congress enacted a rescission from the advance appropriations provided in FY2007 for
use in FY2008. (See expanded discussion below under “Current Appropriations, Advance
Appropriations and Rescissions”)
Table 3. Section 8 Tenant-Based Rental Assistance (Vouchers), FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Total, Section 8 Tenant-Base}^{d Rental Assistance (Budget}
^{Authority Provided)}^16,3⁹¹^15,8⁸¹^16,7⁰³
^{Total, Section 8 Tenant-Base}^{d Rental Assistance}
^{(Available Budget Authority, pre-rescission)}^16,4²⁶^16,0³⁹^16,6⁶¹
^{Total, Section 8 Tenant-Base}^{d Rental Assistance}
^{(Available Budget Authority, post-rescission)}^15,7⁰³^16,0³⁹^15,8⁶¹
^Curre^{nt Year Budget A}^uthority^12,2³³^11,8⁸¹^12,5⁰³
^{Advance Ap}^{propriation Provided for Nex}^{t Year}^4,15⁸^4,00⁰^4,20⁰
^{Advance Ap}^{propriation Available for Curr}^{ent Year}^4,19³^4,15⁸^4,15⁸
^{Advance Ap}^{propriation Available for Curr}^{ent Year, Les}^{s Rescission}
^{(see below)}^3,47⁰^4,15⁸^3,35⁸
^Vouc^{her Renewal Fundin}^g
^{Gross Budget A}^{uthority for Vouc}^{her Renewals}^14,6⁹⁵^a^14,3¹⁹^b^14,8¹⁹^b
^{Rescission from Advance Ap}^prop^riation⁷²³⁰⁸⁰⁰
^{Net Budget Aut}^{hority for Vouc}^h^{er Renewals}^13,9⁷¹^a^14,3¹⁹^b^14,0¹⁹^b
^{Rental subsidy rese}^rve^{50 50}¹⁰⁰
^{Other Set-Asides}
^{Administrative fees}^1,35¹^a^1,40⁰^1,45⁰^c
^Additi^onal^Fees^{35 40}⁵⁰
^{Family Self Sufficiency (FSS) C}^oor^dinators⁴⁹⁴⁸⁵⁰^c
^{Tenant Protection Vouche}^rs²⁰⁰¹⁵⁰²⁰⁰
^{New In}^creme^{ntal Vouchers}¹²⁵¹¹⁴¹³⁴
^{Working Capital Fund}⁶⁸^b⁸^b
^Source:^Prepa^{red by CRS on t}^h^e^{basis of tables}^{provided by the}^Approp^{riations Committee, the President’s FY200}⁹
^{Budget documents, HUD Congre}^{ssional Budget Justifications, S. 3261 a}^{nd S.Rept. 110-}⁴¹^8.

^Note:^{An addit}^{ional $85 million i}ⁿ^FY20^{08 e}^mergen^{cy s}^u^p^plement^{al tenant-based r}^{ental assistance}^f^{unding was}
^{provided by P.L. 110-}³²^{9. These f}^{unds are}^{for u}^{se in areas}^affected^{by th}^{e 2}⁰⁰⁵^h^urrica^{nes are}^{not included in this}
^table.
^a.^{The Congressional Budget Ju}^{stifications for FY200}^{9 s}^{how gross re}^{newal fu}^{nding about}^$1^{0 million}^higher
^{than t}^{he amou}^{nt s}^{hown he}^{re and}^{administrative fee fu}^{nding about}^$10^{million less than the amou}^nt^shown
^{here. It a}^ppear^{s that}^{HUD may}^h^{ave trans}^{ferred a}^p^p^{roximately $1}^{0 million from administrative fees to}
^{renewals in FY2}⁰⁰^{8; however, t}^h^e^{Congressional Budget Justificati}^{ons indicate that the}^amount^{s ava}^{ilable for}
^{calendar year}²⁰^{08 (t}^{he vouc}^her^{program is f}^{unded and administer}^{ed on a calendar year}^{basis) is eq}^{ual to}
^{the amou}^{nts show}^{n in t}^{his table.}
^b.^{The President’s FY200}⁹^budget^p^{roposes to chang}^{e the t}^reatme^nt^{of funding}^{for the Working}^{Capital Fund.}
^{Rather tha}^{n treating}^{it as a set-aside within the accou}^{nt, the P}^{resident’s budget}^proposes^{to treat it}^{as a}
^transfe^{r, which, p}^resuma^{bly, would be taken}^{from th}^{e amoun}^{t available for ren}^{ewal fu}^{nding. S. 3261}^adopted
^{this proposal.}
^c.^{Funding for FSS coordinators is provided as a set-aside in the fu}^{nding for administrative fees. The}^total
^{amount p}^{rovided for administrative fees is $}^1,50^{0 million, with $50 million for FSS co}^ordinators.
The budget authority for the tenant-based rental assistance account is made up of two
components: current year appropriations and advance appropriations. Current year appropriations
are provided in a fiscal year for use in that fiscal year. Advance appropriations are provided in a
fiscal year for use in the subsequent fiscal year. For budget scoring purposes, the Appropriations
Committee is charged for an advance appropriation in the year it becomes available for use. Since
FY2001, funding for the Section 8 program has included an advance appropriation, and for most
years, the advance appropriation was the same amount every year. As a result, the amount of
funding that was provided in a given year (the current year appropriation, plus the advance for the
next year) was equal to the amount of budget authority available to the program for that year (the
current year appropriation, plus the advance from the previous year).
In FY2008, the advance appropriation provided by Congress to become available in FY2009 was
less than the amount of the advance appropriation that became available in FY2008 (and was
provided in FY2007). As a result, the amount of budget authority provided in FY2008 ($16,391
million) was less than the amount of budget authority available to the program in FY2008
($16,426 million). Congress was “scored” by CBO for the amount of budget authority available
in the fiscal year, rather than the amount provided by the bill.
FY2008 funding for the tenant-based rental assistance account was further complicated by a
rescission that was included in the administrative provisions of the FY2008 appropriations law.
Section 238 of Division K (P.L. 110-161) directed that HUD reduce the advance appropriation
that was provided in FY2007 for use in FY2008 by $723 million. This rescission did not affect
the amount of budget authority provided by the FY2008 funding bill, but it did affect the amount
of budget authority available to the program in FY2008, reducing it from $16,426 million to
$15,703 million.
In his FY2009 budget request, the President requested that Congress again provide less in
advance appropriations for the Section 8 tenant-based rental assistance account than will become
available in FY2009. The President requested that Congress provide $4,000 million in advance
appropriations for use in FY2010 (a decrease from the $4,158 million in advance appropriations
provided in FY2008 for use in FY2009). In addition to the advance, the President’s budget
requested $11,881 million in current year funding for FY2009.

Combined, the President’s request would result in $16,039 million in available budget authority
for FY2009 (an increase from the $15,703 million available post-rescission in FY2008) and
$15,881 million in budget authority provided in FY2009 (a decrease from the $16,391 million
provided in FY2008).
S. 3261 would provide more in current year funding than the President’s request ($12,503
million, compared to $11,881 million) and more in advance appropriations for use in FY2010
than the President’s request ($4,200 million, compared to $4,000 million). However, S. 3261
includes a rescission of $800 million from the advance appropriation provided in FY2008 for use
in FY2009. As a result, S. 3261 would make less budget authority available for use in FY2009 ⁵⁶
($15,861 million) than the President requested ($16,039 million) but would make more budget
authority available in FY2009 than was available in FY2008 ($15,703 million).
In FY2008, Congress provided $14,695 million to renew existing vouchers, but also rescinded
$723 million from advance appropriations intended to be used for renewal funding (as described
above). The net funding for renewals in FY2008—$13,971 million—was intended to be
supplemented with agencies’ use of their net restricted assets. Net restricted assets are
accumulated unspent funds that agencies are not permitted to spend because their use would
result in the agency leasing more than their allocated number of vouchers (referred to as ⁷
overleasing). In order to enable agencies to spend their net restricted assets, Congress directed
HUD to reduce agencies’ FY2008 funding by the amount by which their net restricted assets
exceeded 7% of their prior year renewal funding (see discussion under “Renewal Formula”
heading below). It was estimated that roughly the same amount of net restricted asset funding
would be freed up as was rescinded ($723 million). As a result, it was assumed that the overall
funding available for renewals in FY2008 would be equal to just under $14,695 million ($13,971
million in appropriations plus $723 billion in newly freed-up net restricted assets).
For FY2009, the President requested $14,319 million for voucher renewals, an increase over
FY2008 ($13,971 million). HUD’s Congressional Budget Justifications indicated that the
President anticipated supplementing the amount requested for renewals by “freeing-up” PHAs’
remaining net restricted assets, which HUD estimated to be worth roughly $600 million.
Combining the President’s requested appropriations level with the $600 million anticipated to be
available from net restricted assets, the FY2009 program level would be $14,919 billion, an
increase over the estimated FY2008 program level ($14,695 million, including the use of $723
million in net restricted assets), of about $250 million, or 1.7%. This rate of increase is likely
below the annual adjustment factor (AAF), which is the inflation measure that is generally used ⁸
for calculating PHAs’ budgets; in FY2008, the unweighted average AAF was about 4%.

⁵^$1^2,5⁰³^m^{illion i}ⁿ^c^u^rre^{nt y}^e^a^r^fund^ing⁺^$⁴^,¹⁵⁸^m^illi^{on in prior}^y^e^a^r^a^d^v^a^nc^e^a^pprop^ria^tio^ns^{- $8}⁰⁰^m^illion
^re^sc^{ission =}^$1^5,⁸⁶^{1 m}^{illion a}^v^aⁱ^l^a^bleⁱⁿ^FY20⁰⁹^.
⁶^$1^1,8⁸¹^m^{illion i}ⁿ^c^u^rre^{nt y}^e^a^r^fund^ing⁺^$⁴^,¹⁵⁸ⁱⁿ^pri^o^r^y^e^a^r^a^dva^nc^e^a^ppro^p^ria^tio^{ns =}^$¹⁶^,⁰^{39 m}^illion^a^v^a^ila^bleⁱⁿ
^FY²⁰^09.
⁷^P^H^A^s^ha^v^e^be^eⁿ^pr^ohi^bite^d^f^r^om^us^ing^e^x^c^e^s^s^budg^e^t^a^u^th^or^ity^to^f^{und v}^ouc^he^r^s^a^b^ov^e^theⁱ^r^a^l^l^o^c^a^t^e^d^ba^s^e^line^—
^referred^t^o^{as o}^v^erl^easiⁿ^g—siⁿ^{ce F}^Y²⁰⁰³^.
⁸^C^a^lc^ula^t^e^d^by^C^R^S^us^ing^FY²⁰⁰⁸^A^A^Fs^,^Ta^b^l^{e 1}^{, h}ⁱ^g^h^{est co}^{st u}^tⁱ^lityⁱⁿ^clu^d^e^d^.^{Data av}^ailab^l^{e f}^r^o^m^{HUD at}
^h^t^t^p^:^/^/^www^.^h^u^d^u^s^er.^o^rg/^d^at^aset^s/^aa^f^.^h^t^m^l^.

S. 3261 would adopt a renewal funding strategy similar to the one used in FY2008. The bill
would provide $14,819 million for renewals but also rescind $800 million from the advance
appropriation provided in the prior year. The resulting net funding level ($14,019 million) would
be less than the amount requested by the President for renewals ($14,319 million). However, the
bill assumes that PHAs will have access to their net restricted assets in an amount roughly equal
to the amount rescinded, making $14,819 million available for renewals. This amount would be
more than was provided in FY2008 and more than the overall program level proposed by the
President (including the use of net restricted assets).
One of the most contentious aspects of the HUD budget in recent years has been how Congress
directs HUD to allocate voucher renewal funding to PHAs. Although a statutory allocation
formula exists, it has been overridden in the annual appropriations acts each year since FY2003.
In some years, PHAs have been funded according to the cost of their vouchers and the number of
vouchers they have leased (called their utilization rate); in other years, PHAs have been funded
on the basis of what they received in the previous year, without adjustments for cost or utilization
changes. (For more information, see CRS Report RL33929, Recent Changes to the Section 8
Voucher Renewal Funding Formula, by Maggie McCarty.)
In FY2008, Congress directed HUD to fund PHAs on the basis of their costs and utilization from
the previous year, adjusted for inflation and other factors. Congress then directed HUD to reduce
each PHA’s allocation by the amount that their net restricted assets exceeded 7% of their previous
year’s allocation, and then prorate PHAs’ budgets to fit within the amount appropriated ($13,921 ⁹
million). Some PHAs—PHAs participating in the Moving to Work demonstration, PHAs that
spent more than they were allocated in the previous year, certain PHAs affected by the 2005
hurricanes, and PHAs under a HUD receivership—were subject to a different formula. Moving to
Work PHAs were funded on the basis of their contracts with HUD; PHAs that spent more than
their allocations were funded on the basis of what they received in the previous year, plus
inflation; and the others were funded on the basis of the higher of what they received in the
previous year (plus inflation), or what they were eligible to receive under the FY2008 funding
formula. The prohibition on overleasing was continued in FY2008.
Additionally, Congress provided $50 million for a rental subsidy reserve that HUD could use to
fund PHAs that would either not have enough funding to maintain their current vouchers or that ¹⁰
faced high portability costs.
For FY2009, the President requested that PHAs be funded on the basis of what they received in
the previous year, plus inflation, reduced by their remaining net restricted assets, and prorated to
fit within the amount appropriated. The President’s budget also included a request for a $50
million rental subsidy reserve to adjust the budgets of PHAs facing unforeseen circumstances or
high portability costs. Finally, the President’s budget proposed allowing PHAs to use excess
budget authority to fund additional vouchers above their baseline allocation (overleasing), which,
as noted earlier, they have been prohibited from doing since FY2003.

⁹^$1^3,9⁷¹^m^{illion le}^{ss t}^h^e^$^{50 m}^ill^{ion re}^nta^l^su^bsidy^re^se^rve^.
¹⁰^P^o^rta^b^ility^{is the}^te^rm^use^d^to^de^sc^ribe^the^pr^oc^e^{ss in w}^h^ic^{h a}^f^a^m^ily^w^{ith a}^v^ouc^he^{r m}^o^v^e^{s f}^r^o^m^the^jurisdic^ti^on^of
^oⁿ^e^P^H^A^to^t^h^{e ju}^rⁱ^sd^icti^oⁿ^o^f^an^o^t^h^e^{r. I}ⁿ^so^m^e^{cases, P}^H^A^s^can^{face in}^creased^co^{sts d}^u^e^to^p^o^rtabⁱ^lity^m^o^v^e^s.

For PHAs whose costs and utilization remain relatively steady from FY2008 to FY2009, this
formula change would have little impact; for PHAs with increases/decreases in costs and/or
utilization, this formula change could result in a relative funding decrease/increase from FY2008
to FY2009.
S. 3261 included a renewal funding formula similar to the one used in FY2008. Specifically,
PHAs would be funded on the basis of their costs and utilization from the previous year, adjusted
for inflation and other factors, reduced by the amount of net restricted assets they had
accumulated (up to $800 million in aggregate), and prorated to fit within the amount
appropriated. The only agencies that would be funded under an alternate formula would be
Moving to Work agencies, who would continue to be funded on the basis of their agreements. S.

3261 would maintain the prohibition on overleasing.

Of the amount available for renewals, $100 million would be set aside to adjust the budgets of
agencies (1) with a significant increase in costs due to unforeseen exigencies or portability; (2)
with increased leasing between the end of the fiscal year (the period upon which the cost and
utilization data are based) and the end of the calendar year (the period for which PHAs are
funded); or (3) with low utilization because of vouchers that were set aside for prior, project-
based commitments.
Prior to FY2003, administrative fee funding was provided as a part of voucher renewal funding.
PHAs were paid administrative fees on a per voucher basis, in an amount based on a formula tied
to HUD-established fair market rents (FMRs) in their communities. In FY2003, Congress
separated administrative fee funding from voucher renewal funding and directed HUD to provide
administrative fees to PHAs on a pro-rata basis, according to what they received in the previous
year.
This formula change was maintained until FY2008, when Congress directed HUD to allocate
administrative fees to PHAs on the basis of the per voucher formula tied to FMRs that was in use
prior to FY2003. However, Congress continued to set-aside a fixed amount of funding for
administrative fees ($1,351 million in FY2008). While more administrative fee funding was made
available to PHAs in FY2008 than FY2007, it is estimated that the amount provided in FY2008
would not be sufficient to fund 100% of PHAs administrative fee eligibility under the formula.
For FY2009, the President’s budget requested an increase in administrative fee funding (by about
$50 million to $1,400 million). The President’s budget request proposed using the same formula
for allocating administrative fees as was used in FY2008.
S. 3261 would provide $1,500 million for administrative fees. That amount includes $1,400
million for administrative fees, to be allocated using the formula used in FY2008, as requested by
the President. Of the remaining $100 million, $50 million would be set aside for PHAs requiring
extra funds to administer their vouchers, and $50 million would be set-aside for Family Self
Sufficiency (FSS) coordinators. (FSS coordinators have historically been funded separately from
administrative fees.)

FY2008 was the first year since FY2002 that Congress funded new incremental vouchers. From
FY2003 through FY2007, the only “new” vouchers that were funded by Congress were vouchers
for families displaced from other forms of housing assistance (called tenant protection vouchers). ¹¹
In FY2008, Congress provided $125 million to fund new vouchers for homeless veterans, non-
elderly disabled families, and families in the child welfare system (including youth aging out of ¹²
foster care).
In his FY2009 budget, the President requested $39 million to fund incremental vouchers for
elderly and disabled families who were displaced by the 2005 hurricanes and whose FEMA-
funded rental assistance will be ending in March 2009. He also requested $75 million for new
incremental vouchers for homeless veterans (VASH vouchers).
S. 3261 would provide $20 million for FUP vouchers, $75 million for VASH vouchers, and $39
million for vouchers for elderly and disabled households displaced by the 2005 hurricanes.
This account provides funding to administer and renew existing project-based Section 8 rental
assistance contracts between HUD and private landlords. Under those contracts, HUD provides
subsidies to units owned by private landlords that allow eligible low-income families to live in
the units but pay only 30% of their incomes toward rent. No new contracts have been entered into
under this program since the early 1980s. When the program was active, Congress funded the
contracts for 20-40 year periods, so the monthly payments for landlords came from old
appropriations. However, once those contracts expire, if they are renewed, they require new
annual appropriations.
Two totals are provided in Table 4: budget authority provided, which includes advance
appropriations provided for use in the subsequent fiscal year; and available budget authority,
which includes the advance appropriation provided in the prior fiscal year for use in the current
fiscal year.

¹¹^C^a^lle^d^Ve^te^r^a^ns^-^A^f^f^aⁱ^r^s^Suppor^t^e^{d H}^ousⁱⁿ^g⁽^V^A^S^H⁾^v^ouc^he^r^s^.
¹²^Ca^lle^{d Fa}^mⁱ^l^y^Unif^ic^a^{tion P}^r^og^ra^m^(FUP^{) v}^o^u^c^h^e^r^s.

Table 4. Section 8 Project-Based Rental Assistance,
FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Section 8 Project-Based Rental Assistance}^6,38^{2 7,40}⁰^8,45⁰
^{(Budget Authority Provided)}
^{Section 8 Project-Based Rental Assistance}^6,38^{2 7,00}⁰^6,70⁰
^{(Available Budget Authority)}
^Curre^{nt Year Ap}^prop^{riations for Contract}^6,13⁹^a^6,76³^c^6,45⁸^c
^Renewals
^{Advance Ap}^{propriation for Cont}^{ract Renewals}^NA⁴⁰⁰^1,75⁰
^Contract^{Administrators}²³⁹^b²³²²³²
^{Working Capital Fund}⁴⁵^c¹⁰^c
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^ngressional
^{Budget Justifications.}
^Note:^{An addit}^{ional $50 million i}ⁿ^FY20^{08 e}^mergen^{cy s}^u^p^plement^{al project-based rental assistan}^ce^{funding was}
^{provided by P.L. 110-}³²^{9. These f}^{unds are}^{for u}^{se in areas}^affected^{by th}^{e 2}⁰⁰⁵^h^urrica^{nes are}^{not included in}
^{this table.}
^a.^{The bill specified that}^{up to}^t^{his a}^{mount is to be}^{made available to fund r}^{enewals. This amount}^may^be
^{reduced in order to incr}^{ease f}^uⁿ^{ding for contract administrators (}^{see Table Note b}^below).
^b.^{The bill specified that the Sec}^reta^{ry could designate no less tha}^{n $}²³⁹^{million and no more than}^$2⁸⁶
^mill^{ion for contract administrator}^s.
^c.^{The President’s FY200}⁹^budget^p^{roposed changing}^{the t}^reatment^{of funding for}^{the Working Ca}^{pitol Fund.}
^{Rather tha}^{n treating}^{it as a set-aside within the accou}^{nt, the P}^{resident’s budget}^{proposed to treat it}^{as a}
^transfe^{r, which, p}^resuma^{bly, would be taken}^{from th}^{e amoun}^{t available for ren}^{ewal fu}^nding.^S^.³²⁶¹
^{adopted this proposal.}
In July 2007, HUD stopped making monthly payments to project-based Section 8 property
owners and suspended renewals of expiring contracts. At the time, HUD stated that they lacked
sufficient funding to meet the needs of their existing contracts. Department officials stated that
the problem arose because HUD’s legal counsel had determined that HUD could no longer
obligate partial funding when it entered into a 12-month contract renewal with a property owner,
which had been the Department’s past practice.
The FY2007 funding level had been sufficient to fund partial contract renewals, but not sufficient
to fund all contract renewals for their full 12 month terms. The Office of Management and Budget
(OMB) and HUD worked together to identify sufficient funding to resume payments to landlords
for the remainder of FY2007 (including retroactive payments), and HUD modified its contracts to
indicate that funding might not be set aside for the full length of the contract. This practice of
short-funding contracts was the subject of a hearing before the House Financial Services

Committee. At that hearing, a HUD official testified that HUD’s FY2008 funding request would ¹³
be sufficient to partially fund contracts through the end of FY2008.
Figure 4 helps illustrate the concept of full contract funding versus partial contract funding.
Project-based contracts expire throughout the year. When a contract expires, HUD can either
provide funding for the full 12-month term of the contract (the light plus dark shaded areas of
Figure 4) or some shorter period, such as through the end of the federal fiscal year, September 30
(the dark shaded areas of Figure 4).
For example, if a contract expires at the beginning of July, in order to fund it through the end of
the federal fiscal year (as shown in the dark shaded area in Figure 4), HUD would be required to
provide 3 months’ worth of funding. To fund the contract for a full year, through the following
July, HUD would be required to provide 12 months of funding (as shown in the dark and light
shaded area in Figure 4).
Assuming all of the roughly 18,000 project-based Section 8 contracts expire evenly across the
months of the year (which is likely not the case), in order to fund all 18,000 contracts through the
end of the fiscal year, HUD would need 78 months worth of funding (see dark shaded area of
Figure 4). In order to fund all 18,000 contracts for their full 12 month terms, HUD would need

144 months worth of funding (sum of dark shaded and light shaded areas in Figure 4).

Figure 4. Illustration of Project-Based Contract
Partial Funding
^Source:^Figure^prepa^{red by}^{CRS assuming co}^{ntracts e}^xpire^{in eq}^u^{al increments over}^the^year.

¹³^S^{ee t}^r^an^scri^p^t^f^r^o^m^“T^h^e^I^m^p^act^o^f^L^a^t^e^Ho^u^sⁱⁿ^{g Assi}^st^an^{ce P}^a^ym^en^t^s^oⁿ^T^eⁿ^aⁿ^t^{s an}^d^Owⁿ^e^{rs i}ⁿ^t^h^{e P}^r^o^j^ect^-Based
^R^e^nta^l^A^s^sⁱ^s^t^aⁿ^c^e^P^r^og^r^a^m^,^”^he^a^r^ing^be^f^o^r^e^the^H^o^us^e^Fina^nc^ia^l^Se^r^v^ic^e^s^C^o^m^m^itte^e^,^We^dne^s^d^ay^{, O}^c^tobe^r¹⁷^,²⁰⁰⁷^.

For FY2008, Congress provided about $600 million more for project-based rental assistance than
the President requested. That amount of funding was estimated to be sufficient to fund all of the
existing contracts through at least the end of the fiscal year, but not sufficient to provide a full 12
months worth of funding for all of the contracts. HUD estimated that it would need an additional ¹⁴
$1,900 million to fully fund all contracts for 12 months.
For FY2009, the President requested $6,763 million for project-based contract renewals and also
requested that Congress provide an additional $400 million in advance appropriations to become
available in FY2010. HUD’s Congressional Budget Justifications indicate that the amount of
current year funding requested would be sufficient to fund all contracts through the end of the
2009 federal fiscal year (September 30, 2009), and that the $400 million advance would be
sufficient to cover the program’s payment needs on the first day of the next fiscal year (October 1,
2009). The requested funding level would not be sufficient to fully fund all contracts for 12
months.
S. 3261 would provide $6,458 million in current year funding for project-based contract renewals
in FY2009 and $1,750 million in advance appropriations to become available in FY2010. The
total amount provided by S. 3261 for renewals would be $8,498 million, $1,335 million more
than the President’s request. The Senate committee report (S.Rept. 110-415) noted that the
increased funding would not be sufficient to fund all contracts for 12 months but would “restore
some stability to the program by allowing the Department to enter into longer-term contracts with
owners.”
The public housing program provides publicly owned and subsidized rental units for very low-
income families. Although no new public housing developments have been built for many years,
Congress continues to provide funds to the more than 3,100 public housing authorities (PHAs)
that own and maintain the existing stock of more than 1.2 million units. Through the Operating
Fund, HUD provides funds to PHAs to help fill the gap between tenants’ contributions toward
rent and the cost of ongoing maintenance, utilities, and administration of public housing. Through
the Capital Fund, HUD provides funding to PHAs for large capital projects and modernization
needs. HOPE VI is a competitive grant program that provides funds to help demolish and/or
redevelop severely distressed public housing developments, with a focus on building mixed-
income communities.

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^H^ous^e^A^ppr^opr^ia^tio^ns^Su^bc^om^mⁱ^tte^e^{on T}^r^aⁿ^s^por^ta^tio^{n, H}^o^us^ing^a^{nd U}^r^ba^{n D}^e^v^e^lopm^eⁿ^{t, a}^{nd R}^e^la^te^{d A}^g^eⁿ^cⁱ^e^s^,
^Fe^br^ua^r^y^{13, 2}⁰⁰⁸^.

Table 5. Public Housing, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Public Housing O}^{perating Fu}^nd^4,20⁰^4,30⁰^4,40⁰
^{Operating Su}^bsidies^4,19⁴^4,29⁴^4,39⁴
^{Transition to asset-based manage}^ment⁶⁶⁶
^{Public Housing Ca}^{pital Fund}^2,43⁹^2,02⁴^2,44⁴
^Formula^grants^a^2,32^{7 1,93}⁹^b^2,34²^b
^Technical^{assistance/re}^mediation¹²⁷²
^{Administrative/Judicial}^receivership⁹¹⁰⁹
^Emerge^ncy^needs¹⁹⁰^20c
^{Service coordinators and sup}^port^{ive services}
^{(ROSS) 40}³⁸⁴⁰
^{Financial and physical assess}^ment^s¹⁵¹⁵¹⁵
^{Working Capital Fund}¹⁷¹⁵^b¹⁵^b
^{HOPE VI}¹⁰⁰⁰¹⁰⁰
^{Emergency Fun}^ding¹⁵^—^—
^Source:^Pre^{pared by}^{CRS on th}^{e basis of the P}^resident’^{s FY20}⁰⁹^{Budget documents}^{and HUD Co}^ngressional
^{Budget Justifications.}
^Note:^{An addit}^{ional $15 million i}ⁿ^FY20^{08 e}^mergen^{cy s}^u^p^plement^{al public housing}^{capital fu}^nding^{was provided by}
^{P.L. 110-3}^{29. These}^fu^{nds are for}^{use in a}^{reas affe}^{cted by t}^he²⁰⁰⁵^hur^{ricanes a}^{re not included in t}^h^{is table.}
^a.^{This amount is not s}^{pecified in legislati}^{on, but is calculated by}^su^bt^{racting the}^{set-asides from the a}^c^count
^{total. Because several set-asides are specified as “}^{up to” th}^{e amoun}^{t specified, the amount}^{available for}
^{formula grants}^{may inc}^rease.
^b.^{The President’s FY200}⁹^budget^p^{roposed changing}^{the t}^reatment^{of funding for}^{the Working Ca}^{pital Fund.}
^{Rather tha}^{n treating}^{it as a set-aside within the accou}^{nt, the P}^{resident’s budget}^{proposed to treat it}^{as a}
^transfe^{r, which, p}^resuma^{bly, would be taken}^{from th}^{e amoun}^{t available for formula gra}^{nts. S. 32}^{61 a}^dopted
^{this proposal.}
^c.^{These fu}^{nds would be directed t}^o^emergency^{capital repairs, as w}^{ell as emergency sa}^{fety a}^{nd secu}^r^{ity needs.}
PHAs receive operating funding on the basis of a formula that is meant to make up the difference
between what it costs to maintain public housing and what PHAs receive in tenant rents. Each
year, HUD estimates PHA budgets on the basis of this formula. HUD then compares the amount
of funding PHAs are eligible to receive in aggregate to the amount of funding provided by
Congress. If the amount provided by Congress is less than PHAs’ aggregate budget eligibility,
HUD applies an across-the-board reduction to PHAs’ budgets. The percentage of eligible funding
provided to PHAs after applying the across-the-board reduction is referred to as the proration
level.

In FY2008, Congress provided $4,200 million for public housing operating funds, which was ¹⁵
sufficient to fund an estimated 84% of PHA budget eligibility. In FY2009, the President
requested just under $4,300 million, which HUD’s Congressional Budget Justifications estimate
would result in a proration level of 81%. S. 3261 would provide $100 million more than the
President’s request and $200 million more than the amount provided in FY2008. Using the
estimates from HUD’s Congressional Budget Justifications, the funding level provided by S.

3261 would result in a proration level of just under 83%.

The President’s FY2009 budget requested a roughly 17% decrease in funding for formula grants
under the Capital Fund, compared to FY2008. The amount requested is roughly equal to the
estimated $2 billion in new capital needs that accrue every year in public housing. In addition to ¹⁶
new needs, there is an estimated backlog of roughly $20 billion in unmet capital needs. These
estimates of need, however, are more than 10 years old, and the public housing stock has changed
significantly during that time, due to demolition and disposition of many units. HUD’s
Congressional Budget Justifications note that HUD is in the process of undertaking a Capital
Needs Assessment in order to estimate the current capital needs of public housing. HUD’s
Congressional Budget Justifications also note that PHAs can use their capital funding to leverage
outside resources to help address unmet capital needs.
S. 3261 would provide $2,342 million for capital grants, roughly 21% more than the President’s
requested funding level and slightly more (<1%) than was provided in FY2008.
Each year since FY2003, the President has requested no new funding for the HOPE VI public
housing revitalization program. In response, each year, Congress has continued to fund the
program. Up until FY2003, the program was generally funded at just under $600 million,
although in recent years its funding level has generally been around $100 million. HUD’s
Congressional Budget Justifications criticize the program for a slow expenditure of grant funds
and also note that PHAs are able to use their capital fund grants to leverage resources in much the
same way HOPE VI grants are used to leverage additional resources, making HOPE VI less
necessary. Proponents of HOPE VI cite the program’s transformative effects on severely
distressed communities. (For additional information, see CRS Report RL32236, HOPE VI Public
Housing Revitalization Program: Background, Funding, and Issues, by Maggie McCarty).
S. 3261 would provide $100 million for HOPE VI, setting aside $2 million for technical
assistance. The bill also includes language to extend the authorization for the program through the
end of FY2009. Authorization for the HOPE VI program is currently slated to sunset at the end of
FY2008.

¹⁵^Se^e^htt^p^://w^w^w^.hud.g^o^v^/^of^fⁱ^ce^s^/^pih/^prog^ra^m^s^/^ph/^a^m^/^o^f^/^cy^2008o^b^lig^2.p^d^f^.
¹⁶^A^b^{t A}^s^s^o^cⁱ^a^t^e^s^{, “}^C^a^p^ita^{l N}^e^e^d^s^of^the^Public^H^ousⁱⁿ^g^Stoc^kⁱⁿ¹⁹⁹⁸^F^o^r^m^ula^C^a^pita^{l Stu}^d^y^,^”^J^a^nua^r^y^2000.

The Native American Housing Assistance and Self-Determination Act of 1996 (NAHASDA)
reorganized the system of federal housing assistance to Native Americans by eliminating several
separate programs of assistance and replacing them with a single block grant program. In addition
to simplifying the process of providing housing assistance, the purpose of NAHASDA was to
provide federal assistance for Indian tribes in a manner that recognizes the right of Indian self-
determination and tribal self-governance. NAHASDA provides block grants to Indian tribes or
their tribally designated housing entities (TDHE) for affordable housing activities. Affordable
housing activities include any programs currently authorized in law, as well as model activities as
approved by HUD.
Table 6. Native American Block Grants, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^Nativ^{e American h}^ousing^blo^{ck grants}⁶³⁰⁶²⁷⁶⁵⁰
^{Formula Grant}^s^NS⁶²¹⁶³³
^{Loan Gua}^rantee^{(Title VI Credit}^Subsidy)²²²
^{Technical Assistance}⁴⁴⁴
^Inspe^{ctions, training, tech}^{nical assistance}⁴⁴⁴
^{National American Indian}^Housin^{g Council}^NS⁰⁰
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^ngressional
^{Budget Justifications.}
^Note:^S^{ome set-asides are not s}^{pecified (NS) in the ap}^propriation^{s bills or accompanying}^reports.
a. ^{S. 326}^{1 would provide $}⁴^milli^{on to a national organization representing}^{Native American}^housi^{ng interests.}
The President’s budget requested an appropriation of $627 million in Native American Block
Grants for FY2009, a decrease of $3 million from the level enacted for FY2008. The request
included $2 million in credit subsidy to support about $17 million in loans under the Title VI
program. No set-aside was requested for the National American Indian Housing Council.
The Senate committee recommended an appropriation of $650 million in Native American Block
Grants for FY2009, a $23 million increase over the budget request and a $20 million increase
over the FY2008 level. As requested by the Budget, the committee recommended $2 million in
credit subsidy that would support up to $17 million in guaranteed loans. The committee also
recommended $4 million for inspections of Indian housing units, contract expertise, training,
technical assistance, oversight, and management.
The HOPWA program (42 U.S.C. §§12901-12912) provides housing assistance and related
supportive services for low-income persons with HIV/AIDS and their families. Funding is
distributed both by formula allocation and competitive grants to states, localities, and nonprofit

organizations. (For background, see CRS Report RL34318, Housing for Persons Living with
HIV/AIDS, by Libby Perl).
Table 7. HOPWA, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Housing fo}^{r Persons}^{with AI}^{DS (HOPWA)}^{300 300}³¹⁵
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
For FY2009, the President proposed to fund the HOPWA program at the FY2008 level—$300
million. For the third year in a row, the Administration’s budget also recommended changing the
formula used to allocate funds to states and localities. Currently the formula uses the cumulative
number of AIDS cases in a recipient jurisdiction (including those individuals who have died) to
determine how funds are distributed. The method proposed by the President would use as formula
factors the number of persons living with AIDS and would include a housing cost factor to
account for rents in high cost areas.
S. 3261 would provide $315 million for HOPWA, an increase of $15 million over both the
FY2008 enacted level and the President’s request. The bill does not discuss the President’s
proposal to change the HOPWA formula.
This office was established to enable HUD to have a comprehensive approach to rural housing
and rural economic development issues. The RHED program provides funding for capacity
building in rural, under-served areas; and grants for Indian tribes, state housing finance agencies,
state and local economic development agencies, rural nonprofits, and rural community
development corporations to pursue strategies designed to meet rural housing and economic
development needs.
Table 8. Rural Housing and Economic Development,
FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Rural Housing}^and^Ec^ono^mic^Development^{17 0}³⁰
^Eco^{nomic Development Assi}^{stance for}^Federally
^{Recognized In}^{dian Tribes}^{0 0}¹²
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}

As in previous years, the Administration proposed no funding for RHED for FY2009. The
Administration argued that if its proposed revisions of the Community Development Block Grant
program (CDBG) are enacted, the needs of America’s rural communities will be addressed
through the state CDBG program, the HOME program, and through the U.S. Department of
Agriculture (USDA) rural housing programs.
The Senate committee recommended an appropriation of $30 million for RHED for FY2009,
which is $13 million more than the FY2008 level. The committee noted that the Office plays an
important role in HUD’s community development activities and that the RHED programs are
sufficiently different from the housing programs administered by the USDA to warrant separate
appropriations.
The committee noted its concern about the high rates of unemployment and poverty experienced
by Native Americans and believes that it is critical to give federally recognized Indian tribes the
resources and tools that will enable them to promote economic development, create jobs, and
increase housing capacity. Therefore the committee recommended that $12 million of the
increased RHED funds be used for conducting economic development and entrepreneurship
activities for federally recognized Indian tribes.
The Community Development Fund (CDF) account supports activities undertaken through the
Community Development Block Grant program. In addition, the CDF has funded other
community development-related programs in past years, including the Economic Development
Initiatives and Neighborhood Initiative demonstrations.
Table 9. Community Development Fund (CDF):
Community Development Block Grants (CDBG)
and Related Set-Asides, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^Enacted^FY20⁰⁹^Request^Senate
^Comm.
^{CDF 3,86}⁶^3,00⁰^3,88⁹
^{CDBG Formula Grant}^s^3,58⁶^2,92⁷^3,58⁶
^Insular^A^reas⁷⁷⁷
^Indian^CDBG⁶²⁵⁷⁶⁵
^Technical^Assistance³⁵⁵
^Working^Capital²³³
^{Economic Development I}^{nitiative Earmark}^{s (EDI)}¹⁸⁰⁰^a²⁰¹
^{Neighborhood Initiative Earma}^rk^{s (NI)}²⁶⁰^a²²
^{CDBG Disaster Recovery Grants}^b
^{Emergency Fun}^ding—Lo^{uisiana Roa}^{d Home}^3,00⁰⁰⁰
^{CDBG Disaster Recovery Grants}^c
^{Emergency Fun}^{ding—2008 D}^isasters^6,80⁰⁰⁰

^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
^Note:^T^{otals may not add due to rounding.}
^a.^{The President’s FY200}⁹^{budget r}^{equested t}^{hat Congres}^{s can}^{cel th}^{e EDI and}^{NI ea}^{rmark f}^unding^pr^{ovided in}
^FY2008.
^b.^$3^billi^{on in CDBG disaster assistance was a}^ppro^{priated in P.L. 11}^0-11^{6 for Lo}^{uisiana’s Road Home}
^Program.
^c.^$30^{0 million in CDBG disaster assistance was a}^pprop^{riated in P.L. 110-}²⁵^{2 for t}^{he Midwest floods of 20}⁰⁸
^{and other disaster}^{relief activities}^{and $6.5}^{billion in CDBG disaster assistance wa}^{s ap}^{propriated in}^{P.L. 110-}
³²⁹^{for 2}⁰⁰⁸^disaster^recovery.
The President’s FY2009 budget recommendation of $2,927 million for the formula portion of
CDBG is $659 million (18.4%) less than the $3,586 million appropriated for distribution to
communities and states in FY2008. In addition, the President’s FY2009 budget request stated that ^th
the Administration would seek to reform the CDBG program during the 110 Congress by again ^th
offering Congress a proposal that was first unveiled during the 109 Congress, namely, the
Community Development Block Grant Reform Act. The Administration proposal, which would
restructure the CDBG distribution formula, includes the following changes:
• replacement of the existing dual CDBG formula with a single weighted formula
that would target assistance on the basis of a community’s or state’s share of
households living in poverty (excluding college students), the number of female-
headed households with minor children, the number of overcrowded housing
units, the number of housing units 50 years or older occupied by low-income
families and per capita income;
• a requirement that entitlement communities would have to meet a minimum grant
threshold in order to receive a direct annual allocation;
• a two-year transition for communities that no longer met the minimum grant
threshold amount; and
• a new $200 million bonus grant program called Economic Development and
Revitalization Challenge Grants to reward entitlement communities with ¹⁷
programs resulting in improved living conditions in distressed neighborhoods.
In addition to requesting reduced funding for CDBG formula grants, the Administration’s
FY2009 budget proposed eliminating funding for several other community development related
programs, including Rural Housing and Economic Development Grants, Community
Development Block Grant Section 108 loan guarantees, and Brownfields Economic Development
Initiatives. The budget characterized these programs as duplicative of the activities funded by the
CDBG formula grant program.
S. 3261, as reported to the Senate on July 14, 2008, recommended an appropriation of $3,889
million for Community Development Fund activities. This includes $3,586 million for formula-
based allocations to 1,173 entitlement communities and the 50 states and Puerto Rico, which is

¹⁷^T^h^e^prop^os^a^l^m^a^y^be^vⁱ^ew^e^d^a^t^h^ttp://w^w^w^.hud.g^o^v^/^c^onteⁿ^t/^re^le^a^s^e^s^/pr06-⁰⁵^6a^c^t^.p^df^{. U}^nde^{r Se}^c^tio^{n 7(}^b)^of^the^dra^f^t
^pr^o^pos^a^l^{, t}^h^e^C^h^a^lle^ng^e^G^r^aⁿ^{t P}^r^o^g^r^am^w^{ould be}^f^uⁿ^d^e^d^a^s^a^s^e^{t a}^sⁱ^d^e^w^{ithin t}^h^e^tota^l^a^ppr^opr^ia^te^{d f}^o^r^C^D^B^G^f^o^r^m^ula
^g^r^aⁿ^{t a}^c^tiv^itie^{s. For FY}²⁰^09,^f^uⁿ^d^ing^of^Cha^lle^ng^e^G^r^aⁿ^{t a}^c^tiv^itie^{s is c}^ontiⁿ^g^e^nt^up^on^pa^ssa^g^e^of^C^D^BG^f^o^r^m^ula
^r^e^f^o^r^m^s^dr^af^te^{d by}^the^A^d^mⁱ^nis^t^r^a^tion.^T^h^e^A^d^mⁱ^nis^t^r^a^tion’^s^pr^o^p^o^s^e^{d C}^D^B^G^R^e^f^o^r^m^A^c^{t, inc}^l^udⁱⁿ^g^c^r^e^a^{tion of}^the^th
^Ch^al^l^eⁿ^g^{e G}^r^an^t^P^r^o^g^ram^,^h^a^{s n}^o^t^b^een^f^o^rm^al^l^yⁱⁿ^t^r^o^d^u^cedⁱⁿ^t^h^{e 11}⁰^C^ong^r^e^s^s^.

the same amount as appropriated for FY2008, but $659 million more than requested by the Bush
Administration. The Senate Appropriations Committee also recommended $201 million in EDI
assistance to be allocated to 192 congressionally designated projects for an average award of just
over $1 million. For FY2008, approximately 820 projects were awarded $180 million in EDI
funds for an average allocation of approximately $220,000. In addition, the Senate Appropriations
Committee recommended a $4 million increase above the amount appropriated for FY2008 for
Neighborhood Initiative earmarks.
The Section 108 loan guarantee program allows states and entitlement communities to leverage ¹⁸
their annual CDBG allocation in order to help finance brownfield redevelopment, large scale
economic development, and housing projects. CDBG entitlement communities and states are
allowed to borrow an amount equal to as much as five times their annual CDBG allocation for
qualifying activities. As security against default, states and entitlement communities must pledge
their current and future CDBG allocations.
Table 10. CDBG Section 108 Loan Guarantees, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Section 108 Loan Guarantees}⁵⁰⁶
^{Loan commit}^{ment ceiling}²⁰⁵⁰²⁷⁵
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
The Administration’s budget did not include funding for the Section 108 loan guarantee program
for FY2009. Citing the results of its Program Assessment Rating Tool (PART), which found the
program was duplicative and that results were not demonstrated, the Administration ¹⁹
recommended the program be terminated.
The Senate Appropriation Committee recommended $6 million in subsidies to support $275
million in loan commitments. This is a slight increase above the amount appropriated in FY2008.
The Brownfields Economic Development Initiative program is a competitive grant program that
provides funds to assist cities with the redevelopment of abandoned, idled, and underused
industrial and commercial facilities where expansion and redevelopment are burdened by real or
potential environmental contamination. The funds are used in support of CDBG Section 108 loan
guarantees and in collaboration with program funding by the Environmental Protection Agency.

¹⁸^Se^e^dis^c^us^sⁱ^oⁿ^u^nde^{r Br}^ow^nf^ie^lds^Ec^onom^ic^D^e^v^e^l^opm^eⁿ^{t Initia}^ti^v^e^he^a^d^ing^la^te^{r in t}^h^is^re^p^o^rt.
¹⁹^T^h^e^P^A^RT^a^s^s^e^s^s^m^e^{nt m}^a^y^be^vⁱ^e^w^e^d^a^t^http^://w^w^w^.^w^hite^hous^e^.^g^o^v^/^om^b/e^x^pe^c^t^m^o^re^/^s^u^m^m^a^r^y^/
¹⁰⁰⁰⁹⁰⁶^6.²⁰^07.^htm^l^.

Table 11. Brownfields Redevelopment, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁹^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^Brown^{fields Redevelopment}¹⁰⁰⁰
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
The Bush Administration’s FY2009 budget—as in previous years—recommended termination of
the Brownfields Redevelopment program. The Senate Appropriations Committee-approved bill
did not include funding for brownfield redevelopment activities.
Created in 1990, the HOME Investment Partnership Program provides formula-based block grant
funding to states, units of local government, Indian tribes, and insular areas to fund affordable
housing initiatives. Eligible activities include acquisition, rehabilitation, and new construction of
affordable housing, as well as rental assistance for eligible families. The HOME program account
has also been used to fund related programs. The American Dream Downpayment Initiative
(ADDI), created in 2003 (P.L. 108-186), funds HOME grantees to provide downpayment, closing
cost, and rehabilitation assistance to first-time home buyers. Housing counseling assistance is
authorized under Section 106 of the Housing and Urban Development Act of 1968 (P.L. 90-448).
HUD provides competitive grants to local housing counseling agencies, intermediaries, and state
Housing Finance Agencies to provide several categories of housing counseling, including
comprehensive counseling, counseling services that address predatory lending, counseling in
conjunction with HUD’s Homeownership Voucher Program, counseling services that specifically
target colonias (rural communities on the U.S.-Mexico border), and Home Equity Conversion
Mortgage counseling.
Table 12. The HOME Investment Partnership Program,
FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{HOME (total)}^1,70⁴^1,96⁷^1,96⁷
^{Formula grants}^a^1,62⁸^1,90³^1,93
^{American Dream Down}^payme^nt^Initiative¹⁰⁵⁰¹⁰
^Technical^assistance¹³¹⁰¹⁵
^{Housing cou}^{nseling assistance}⁵⁰^{b b}
^{Working capital fund tra}^nsfe^r³⁴⁴
^{Housing Co}^unseling^b⁶⁵⁶⁵
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}

^Note:^T^{otals may not add due to rounding.}
^a.^{Includes f}^unding^{for insular a}^reas.
^b.^{The FY200}⁹^budget^{proposed fu}ⁿ^{ding housing cou}^{nseling at $}⁶⁵^milli^{on in a separate}^{account. I}ⁿ^pas^{t years,}
^{funding for}^housing^counseling^ha^{s been}^{provided as a set-aside within the}^HOM^E^{program. S. 32}⁶¹^would
^fund^{housing cou}^{nseling in a se}^pa^{rate account, as}^req^uested^{by the}^President.
The President’s FY2009 budget requested a $275 million increase in funding for HOME formula
grants over the FY2008 funding level. HUD’s Congressional Budget Justifications identify the
HOME program as key to the President’s goal of increasing homeownership opportunities,
especially for minorities. They also cite the program’s relatively strong rating from the Office of
Management and Budget’s (OMB) Program Assessment and Rating Tool evaluation. According
to HUD’s Congressional Budget Justifications, OMB found that the program “has a clear
purpose, strong management, and can demonstrate results.”
S. 3261 would provide $1,937 million for formula grants, just under 2% more than the President’s
requested level and a nearly 19% increase over the FY2008 level.
The President’s budget requested a 400% increase in funding for ADDI, from $10 million in
FY2008 to $40 million in FY2009. The program was originally authorized through the end of
FY2007 at $200 million per year, although it has never been funded at more than $86 million.
The program was slated to sunset at the end of FY2007, but it was continued through FY2008 by
the FY2008 appropriations law. The President’s FY2009 budget requested language to extend the
program through FY2011.
S. 3261 would provide $10 million for ADDI, an amount equal to the FY2008 funding level. The
bill includes language to extend the authorization for ADDI, as requested by the President.
In each of the past several years, the President has requested that Congress provide funding for
housing counseling assistance in a separate account, and each year, Congress has continued to
fund it as a set-aside within the HOME account. For FY2009, the President’s budget again
requested that housing counseling be funded separately from HOME, at $15 million more than it
was funded in FY2008. HUD’s Congressional Budget Justifications cite the housing counseling
program’s ability to aid troubled homeowners during the current period of increased mortgage
defaults and foreclosures as the reason behind the request for increased funding.
S. 3261 would fund housing counseling in a separate account, at the President’s requested level
($65 million).
This account funds the Self-Help Housing Opportunity Program (SHOP) program and several set-
asides. Through the SHOP program, HUD provides grants to national and regional organizations

and consortia that have experience in providing or facilitating self-help homeownership
opportunities. Prospective home buyers and volunteers provide “sweat equity” by contributing
labor toward the construction of their homes.
Table 13. Self Help Homeownership Opportunities,
FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Self He}^{lp Homeownership O}^pportunities⁶⁰⁴⁰⁶⁶
^{Self Help Homeowners}^{hip (SHO}^P)²⁷⁴⁰²⁷
^{Technical Assistance}⁰^<1⁰
^{Capacity Building Comm. Dev. an}^d^{34 0}³⁵
^{Affordable Housing}^a
^{Housing Assistance}^Council^b^{0 4}
^{National American Indian}^Housin^{g Council}^c^{0 0}
^{National Council of La Raza}^d^{0 0}
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
^a.^{Includes lang}^{uage directing that}^u^p^{to $5}^milli^{on of the total amou}^{nt ap}^{propriated b}^e^{used to s}^u^p^port
^{capacity b}^{uilding activities in rural areas.}
^b.^{Funds included in CDF’s Neighbo}^{rhood Initiative subaccou}^{nt with}^{a funding level of $}³^million.
^c.^{Funds included in CDF’s Neighbo}^{rhood Initiative subaccou}^{nt with}^{a funding level of $}¹^million.
^d.^{Funds included in CDF’s Neighbo}^{rhood Initiative subaccou}^{nt with}^{a funding level of $}¹^million.
The President’s FY2009 budget requested $40 million for the SHOP program, including just
under $1 million for technical assistance. The President’s budget did not include funding for
Section 4 (capacity building) grants. These grants are usually awarded to four national
intermediaries—National Community Development Initiative (Living Cities), the Local Initiative
Support Corporation, the Enterprise Foundation, and Habitat for Humanity. Recipients use the
funds to develop the capacity and ability of local community development corporations and
community housing development organizations to develop and manage community development
and affordable housing projects and programs.
S. 3261, as reported by the Senate Appropriations Committee, recommended an appropriation of
$66 million for the Self-Help Homeownership Opportunities account. This is $6 million more
than appropriated for FY2008 and $26 million more than requested by the Administration. The
bill includes $35 million for capacity-building grants to be awarded to the Enterprise Foundation,
the Local Initiative Support Corporation, and Habitat for Humanity. This is $1 million more than
appropriated in FY2008. The bill would also appropriate $4 million to be awarded to the Housing
Assistance Council for capacity-building activities in rural areas.

Homeless Assistance Grants is the blanket title given to four homeless programs authorized by
the McKinney-Vento Homeless Assistance Act (P.L. 100-77) and administered by HUD. Three of
the four programs are competitive grants: the Supportive Housing Program (SHP), the Shelter
Plus Care program (S+C), and the Section 8 Moderate Rehabilitation Assistance for Single Room
Occupancy program (SRO). Funding for the fourth HUD program, the Emergency Shelter Grants
program (ESG), is distributed via a formula allocation to states and local communities. The
Homeless Assistance Grants are codified at Title 42, Chapter 119, Subchapter IV of the U.S.
Code. (For more information about the Homeless Assistance Grants, see CRS Report RL33764,
The HUD Homeless Assistance Grants: Distribution of Funds, by Libby Perl).
Table 14. HUD Homeless Programs, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Homeless Assistance Grants}^1,58⁶^1,63⁶^1,66⁷
^{Formula and Competitive Gra}^nts^a^1,62²^a
^Technical^{Assistance/Data}^{8 8 8}
^{Working Capital Fund}²³^b³
^{Rapid Re-Housing Demonstration Program}²⁵³⁰
^{Demonstration Program for t}^he^{Prevention of Homelessne}^ss^{0 0}¹⁰
^{Among Veterans}
^{Evaluation of Housing}^{Models to Assist Homeless Youth}⁰⁰³
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^ngressional
^{Budget Justifications.}
^a.^{Amount is not s}^pecified.
^b.^{The $3}^milli^{on proposed for t}^he^{Rapid Re-Housing Demonstration Program would fu}^{nd and evalua}^{tion of}
^{the p}^rogram.
Funding levels for the Homeless Assistance Grants have increased steadily since FY2005, from
$1,230 million in that year to $1,586 million in FY2008. For FY2009, the President proposed to
again increase funding for the grants, to $1,636 million. For the seventh year in a row, the
Administration’s budget proposed to consolidate the three competitive Homeless Assistance
Grants—SHP, S+C, and SRO—into one competitive grant. The proposed consolidated grant
would include up to $50 million for a Samaritan Housing Initiative, which would provide
permanent supportive housing for chronically homeless individuals—those who have been
homeless for long periods of time and who have a disability. This proposal is similar to an
incentive currently provided in the Homeless Assistance Grants application process.
In addition to the Homeless Assistance Grants, the President’s budget recommended $75 million
for Section 8 vouchers for homeless veterans (see earlier discussion of new incremental vouchers
under Section 8 tenant-based rental assistance). Funding for these vouchers would be provided
through the Section 8 tenant-based account, and not through the Homeless Assistance Grants.
About 1,800 of these vouchers were initially provided for homeless veterans through a
collaboration between HUD and the Department of Veterans Affairs (VA) called HUD-VA

Supported Housing, or HUD-VASH. Approximately 1,000 of these vouchers are still used by
veterans today. In FY2008, Congress appropriated $75 million for additional HUD-VASH
vouchers. On April 16, 2008, HUD, together with the VA, announced the communities that would
receive HUD-VASH vouchers; a total of 10,070 vouchers will be distributed. The amount
requested by the President for FY2009 would likely fund approximately the same number of
vouchers.
The Senate Appropriations Committee-approved FY2009 funding bill, S. 3261, would
appropriate a total of $1,667 million for the Homeless Assistance Grants, which is $81 million
more than the FY2008 enacted level and $31 million more than the President’s request. Of the
amount requested by the Appropriations Committee, $10 million would be available for a
demonstration program for the prevention of homelessness among veterans. Under the
demonstration program, HUD would collaborate with the VA and the Department of Labor
(DOL) and would provide funding to local homeless assistance organizations, which would in
turn provide housing and services to veterans who are at risk of homelessness or are temporarily
homeless. The Senate bill would also provide $3 million to evaluate housing models that are most
effective at preventing and ending homelessness among youth (those age 16-24).
Like the President’s request, the Senate Appropriations Committee bill would provide $75 million
in the Section 8 tenant-based rental assistance account for new Section 8 vouchers for homeless
veterans in FY2009. This would fund approximately 10,000 new vouchers. Unlike the President’s
request, S. 3261 does not set aside funding for a Samaritan initiative to provide permanent
supportive housing for chronically homeless individuals. According to the committee report
(S.Rept. 110-418), “HUD already targets funding to the chronically homeless, and the Committee
believes that increased funding should be made available for both homeless families and
homeless individuals.”
Formerly known together as Housing for Special Populations, the Section 202 Housing for the
Elderly program (12 U.S.C. §1701q) and the Section 811 Housing for Persons with Disabilities
program (42 U.S.C. §8013) provide capital grants and ongoing project rental assistance contracts
(PRAC) to developers of new subsidized housing for these populations. In addition, the Section

811 program provides vouchers for tenants with disabilities to use in the private housing market.

The Housing for the Elderly appropriation includes funds for the Service Coordinator program
and the Assisted Living Conversion program. (For more information on Section 202, see CRS
Report RL33508, Section 202 and Other HUD Rental Housing Programs for Low-Income Elderly
Residents, by Libby Perl).

Table 15. Sections 202 and 811, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Housing fo}^{r the Elderly (202)}⁷³⁵⁵⁴⁰⁷⁶⁵
^{New Capital Gra}^{nts and PRAC}^a³²¹^a
^{PRAC Renewals and Amendment}^s^a⁹⁶^a
^Service^Coordinators⁶⁰⁸⁰⁸⁰
^Grants^{for Conver}^{sion to Assisted Living}²⁵²⁵²⁵
^{Pre-development}^Gra^nts²⁰⁰²⁰
^{Working Capital Fund}¹²²
^{Leveraging Financi}^{ng Demonstrat}^ion⁰¹⁵¹⁵
^{Housing fo}^{r the Disabled (811)}²³⁷¹⁶⁰²⁵⁰
^{New Capital Gra}^{nts and PRAC}^a³⁰^a
^{PRAC Renewal and Amendments}^a³²^a
^{New Mainst}^{ream Vouc}^hers^a⁰^a
^{Mainstream Vouc}^{her Re}^newal⁷⁵⁸⁷⁸⁷
^{Working Capital Fund}¹²²
^{Leveraging Financi}^{ng Demonstrat}^ion⁰¹⁰¹⁰
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
^a.^{Amounts not}^specified.
In FY2009, the Administration’s budget recommended reducing the overall funding level for the
programs that provide housing and services for elderly households (defined by HUD as those
with a head of household or spouse age 62 or older). The President’s request would cut funding
for these programs by nearly $200 million, from $735 million in FY2008, to $540 million in
FY2009. For the Section 202 program, funding available for new capital grants and project rental
assistance would be $321 million, down from the $566 million that is estimated to be available
from the FY2008 appropriation. The proposed FY2009 allocation of $321 million would fund an
estimated 2,300 units of Section 202 housing, compared to an estimated 4,100 in FY2008. Under
the President’s request, funding for the Service Coordinator program would increase from the
amount appropriated in FY2008, from $60 million to $80 million, while funds for the Assisted
Living Conversion program would remain the same, at $25 million.
As in FY2008, the President has proposed to fund a leveraging financing demonstration program
through the Housing for the Elderly account in FY2009. Through the program, HUD would work
with private sector professionals to increase the use of mixed financing arrangements, such as
incorporating Low-Income Housing Tax Credits, to develop Section 202 housing. The
demonstration program would also identify changes to existing policy that might make mixed-

finance developments more feasible. HUD’s goal is that the program would leverage one dollar of
outside financing for every dollar of Section 202 funding.
S. 3261, as reported by the Senate Appropriations Committee, would provide a total of $765
million for the Housing for the Elderly account, including the Section 202 program, Service
Coordinators, and the Assisted Living Conversion program. The amount recommended by the
Senate Appropriations Committee is $30 million more than the amount provided in FY2008, and
$225 million more than the President’s budget request. Of the amount that would be appropriated
in S. 3261, $80 million would be available for the Service Coordinator program, the same level
requested by the President, and a $20 million increase over FY2008. The bill would provide level
funding of $25 million for the Assisted Living Conversion program. Like the President’s request,
S. 3261 would appropriate $15 million for a leveraging financing demonstration program,
described above.
S. 3261 includes language that would make a change to the refinancing provisions of the statute
governing the Section 202 program. Under current law, Section 202 owners may refinance their
properties if they agree to operate the project under terms at least as advantageous to tenants as
the terms of the existing loan and if the refinancing results in a lower interest rate and reduced
debt service. Under the language in S. 3261, the new loan would not be required to have a lower
interest rate as long as the project owner would use the new funding to address the project’s
physical needs. This would make it possible for older Section 202 developments, many of which
have loans with interest rates of 3%, to refinance their loans and use the proceeds to make
improvements to the property. The Senate Appropriations Committee bill also includes a
provision that would require HUD to provide enhanced vouchers to Section 202 tenants in cases
where insufficient project-based rental assistance is made available to the development.
The President’s budget proposed to reduce funding for the Section 811 Housing for Persons with
Disabilities program in FY2009 to $160 million, down from $237 million in FY2008. Of the
amount proposed by the President, just under $30 million would be available for new capital
grants and project rental assistance, which HUD estimates would support 232 new rental units. In
FY2008, approximately $142 million was made available for capital grants and project rental
assistance, which is expected to support 1,050 units. The Administration recommendation would
not provide any funding for new Section 811 vouchers for persons with disabilities. Although the
FY2008 appropriation did not contain funds for new vouchers through the Section 811 program,
it provided $30 million for vouchers for non-elderly disabled families through the Section 8
account (see earlier discussion).
For FY2009, the Administration has proposed that funds from the Service Coordinator program,
provided through the Housing for the Elderly Account, be provided for Section 811 developments
as well as developments designed for elderly households. The HUD budget documents note that
legislation to expand the Service Coordinator program to include Section 811 could be introduced
this Congress, and if it is, that approximately $19 million of the $80 million requested for new
Service Coordinator contracts would be available to Section 811 developments.
For the second year in a row, the President has proposed to fund a leveraging financing
demonstration program, similar to the one proposed for the Section 202 program. The President’s
budget would make $10 million available for this program, which would encourage mixed
finance developments for persons with disabilities.

The Senate Appropriations Committee-passed bill would provide $250 million for the Section
811 program, an increase of $13 million over FY2008 and $90 million more than the President’s
request. As in the committee’s proposed Section 202 appropriation, $10 million of the funds
appropriated for Section 811 would support a leveraging financing demonstration program.
The FHA administers a variety of mortgage insurance programs that insure lenders against loss
from loan defaults by borrowers. Through FHA insurance, lenders make loans that otherwise may
not be available, and enable borrowers to obtain loans for home purchase and home improvement,
as well as for the purchase, repair, or construction of apartments, hospitals, and nursing homes.
The programs are administered through two program accounts: the Mutual Mortgage
Insurance/Cooperative Management Housing Insurance fund account (MMI/CMHI) and the
General Insurance/Special Risk Insurance fund account (GI/SRI). The MMI/CMHI fund provides
insurance for home mortgages. The GI/SRI fund provides insurance for more risky home
mortgages, for multifamily rental housing, and for an assortment of special-purpose loans such as
hospitals and nursing homes. (For more information, see CRS Report RS20530, FHA-Insured
Home Loans: An Overview, by Bruce E. Foote and Katie Jones).
Table 16. Federal Housing Administration, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Net Total F}^{HA Appr}^opriatio^ns⁽⁸¹⁾⁴⁷⁷¹
^{Net Appropriations, MMI}⁷⁷¹²⁶¹⁴⁰
^{Total Expenses}⁷⁷¹¹⁶¹⁴⁰
^Offsetting^receipts⁰⁰⁰
^{Programs moved from G}^I/SRI^NA¹⁰⁰
^{Net Appropriations, GI/SRI}⁽¹⁵⁸⁾⁽⁷⁹⁾⁽⁶⁹⁾
^{Total Expenses}⁹²⁷¹⁷¹
^Offsetting^receipts⁽²⁵⁰⁾⁽¹⁴⁰⁾¹⁴⁰
^{Move programs}^{to MM}^I^NA⁽¹⁰⁾⁰
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
In past years, receipts to the MMI fund have exceeded expenses, so the MMI fund did not need
appropriations for credit subsidy. The FY2009 Budget estimated that, if no programmatic changes
were made, the MMI fund would need either credit subsidy or increases in insurance premiums to
continue operation. The Budget proposed to permit FHA to set insurance premiums on the basis
of the risk that the borrowers pose to the insurance fund, and it proposed to set the rate at a level
that would avoid the need for subsidy appropriations. Barring the authority to establish risk-based
premiums, the Budget proposed that FHA would use its existing authority to increase the
insurance premiums charged to borrowers. The Budget assumed that the increased premiums
coupled with legislative and programmatic changes would avoid the need for credit subsidy
appropriations.

Legislative changes proposed in the budget would include reform of the FHA single family
insurance program to enable FHA to be more flexible in responding to changes in the mortgage
market, and to provide a lower cost alternative to borrowers who might otherwise choose
subprime mortgage products or even become the victims of predatory lending. The Budget
proposed to move several single-family programs from the GI/SRI fund to the MMI fund. The
Budget proposed that no new loan insurance would be provided to households using seller-
financed downpayments to meet their downpayment requirements.
The Budget and S. 3261, as passed by the Senate Appropriations Committee, recommended a
commitment limitation of $185 billion for the MMI fund. The Budget requested a commitment
limitation of $35 billion for the GI/SRI fund, while the Senate Committee recommended a
commitment limitation of $45 billion.
The committee report (S.Rept. 110-418) suggests that, in the wake of the present housing crisis,
FHA must reestablish itself as America’s mortgage lender. The committee suggests that FHA
should work to ensure that families are able to purchase and stay in their homes with affordable
loans that they fully understand. The committee directs HUD to provide a report to the
Committee on Appropriations within 90 days on the proper role of HUD and to establish an
Office of Predatory Lending. Working in conjunction with the Department of Justice, the new
office would establish rules and requirements to protect the public from fraud and abuse in
housing loans.
Ginnie Mae is the entity within HUD that guarantees the timely payment of principal and interest
on securities backed by mortgages insured or guaranteed by FHA, the Department of Veterans
Affairs (VA), or the Rural Housing Service.

Table 17. Government National Mortgage Association,
FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Net Appropriation}⁽¹⁶³⁾⁽¹⁷⁰⁾⁽¹⁷⁰⁾
^{Administrative Expe}^nses^a^b
^Legislative^Proposal^NA^[43]
^Offsetting^Receipts⁽¹⁶³⁾⁽¹⁷⁰⁾⁽¹⁷⁰⁾
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^ngressional
^{Budget Justifications.}
^a.^{The FY200}^{8 a}^pprop^{riations act fu}^{nded GN}^{MA ex}^pen^{ses in t}^{he dep}^{artment-wide salaries and ex}^pen^s^es
^{account at}^$8.2^{5 million.}
^b.^{The President’s FY200}⁹^{budget r}^equest^proposes^{to continue to f}^{und G}^{NMA e}^x^p^enses^{in the}^depa^rtment-
^{wide salaries and expe}^{nses accou}^{nt at $}^8.56^milli^on.
For FY2009, the President’s budget proposes an administrative provision which would bring all
of Ginnie Mae’s administrative contract expenses under discretionary authority. This change is
estimated to cost $43 million, which would be offset in the first year by savings from eliminating
HUD’s mandatory authority to fund these expenses. The Senate committee does not assume this
change in the accounts.
The Office of Policy Development and Research (PD&R) at HUD is responsible for maintaining
current information on housing needs, market conditions, and existing programs, as well as
conducting research on housing and community development issues. The Research and
Technology account funds PD&R’s core research activities including program evaluations and
housing and community development-related surveys such as the American Housing Survey and
the Survey of New Home Sales and Completions. The R&T account was expanded in FY2006 to
fund Section 107 University Partnerships, which were previously funded as set-asides within the
CDF account. Section 107 grants are awarded to institutions of higher education to assist in
building partnerships with the communities in which they are located and to foster and support
neighborhood development and revitalization.

Table 18. Research and Technology, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Research an}^{d Tech}^nology⁵¹⁵⁵⁶⁰
^{Core Research a}^{nd Technology}²³⁴¹³⁰
^Partners^{hips for Adva}^{ncing Tech}^{nology in Housing (PATH)}⁵⁰⁵
^{Section 107}^Gra^{nts/ Univer}^{sity Partners}^hips²³¹⁴²³
^{Historically Black Colleges & Universities}⁹⁵⁹
^{Hispanic-Serving Institutions}⁶⁴⁶
^{Community Developm}^{ent Work Study}⁰⁰⁰
^{Alaskan Native and Native Hawai}^ia^{n-Serving Institutions}³²³
^Tribal^{Colleges and Universities}⁵²⁵
^{Community Outreach Partnership}⁰⁰⁰
^Tenant-^based^{housing vou}^cher^st^udy⁰⁰²
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
The Administration’s FY2009 budget requested $55 million for research and development
activities. The request would increase funding for R&T activities by about 6% or $3 million more
than the $51 million appropriated in FY2008. This would be achieved by increasing the amount
available for core research activities by 45% from $28 million in FY2008 to $41 million for
FY2009. The proposed increase in core research funding would be offset by a proposed 41%
decrease in funding for Section 107 Grants/University Partnerships. Under the Administration’s
budget request, funding for these programs would decline from $23 million to $14 million for
FY2009.
The Senate Appropriations Committee version of S. 3261 recommended $60 million for activities
under the Research and Technology account. This is $9 million more than appropriated in
FY2008 and $5 million more than requested by the Administration. The $60 million includes $23
million in grants for university-based community development grants, which is the same amount
appropriated in FY2008 and $9 million more than requested by the Administration. The bill also
includes $2 million to finance a study of the cost necessary to administer the tenant-based
housing voucher assistance program. The committee report (S.Rept. 110-418) noted that the
committee proposes to deny HUD its broad demonstration authority, noting that the committee
believes HUD has used this authority in the past to administer new and unauthorized programs. S.

3261 would make future demonstrations subject to prior congressional approval.

The Office of Fair Housing and Equal Opportunity enforces the Fair Housing Act and other civil
rights laws that make it illegal to discriminate in the sale, rental, or financing of housing on the
basis of race, color, religion, sex, national origin, disability, or family status. This is accomplished
through the Fair Housing Assistance Program (FHAP) and the Fair Housing Initiatives Program
(FHIP). FHAP provides grants to state and local agencies to enforce laws that are substantially

equivalent to the federal Fair Housing Act. It provides grants on a non-competitive basis. FHIP
provides funds for public and private fair housing groups, as well as state and local agencies, for
activities that educate the public and housing industry about the fair housing laws.
Table 19. Fair Housing Programs, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Fair Housing}⁵⁰⁵¹⁵⁶
^{Fair Housing Assistance}²⁶²⁵²⁷
^{Fair Housing Initiatives}²⁴²⁶²⁹
^Translations^<1⁰^<1
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
The Budget requests $51 million for the fair housing programs, an increase of $1 million over the
FY2008 level. The Senate committee recommends an appropriation of $56 million, a $6 million
increase over the level appropriated for FY2008.
The Budget requests $25 million for FHAP, whereas the Senate committee recommends $27
million for the program. The Budget requests $24 million for FHIP and proposed to use some of it
for a Housing Discrimination Study. The Senate committee recommends over $28 million for
FHIP, an increase of over $4 million from the FY2008 enacted level. The committee directs that
$2 million of the increased funds be used solely to assist in the protection of the American public
from mortgage rescue scams. The committee does not fund or authorize the Housing
Discrimination Study proposed in the budget request.
The President’s budget would not continue funding for the program that creations and promotes
the translation of materials to assistance persons with limited English proficiency, while the
Senate Committee would fund it at $500,000.
The Office of Lead Hazard Control at HUD administers both the Lead-Based Paint Hazard
Control Grant Program and the Healthy Homes Initiative (HHI). Under the Lead-Based Paint
Hazard Control Grant Program, HUD is authorized to make grants to states, localities, and Native
American tribes to conduct lead-based paint hazard reduction and abatement activities in
privately-owned low-income housing. Under the Healthy Homes Initiative, HUD conducts a
number of activities designed to identify and address housing-related illnesses.

Table 20. Lead-Based Paint Hazard Control, FY2008-FY2009
^{(in millions of}^doll^ars)
^FY20⁰⁹
^FY20⁰⁸^FY20⁰⁹^Senate
^Enacted^Request^Comm.
^{Office o}^f^{Lead Hazar}^{d Co}^ntr^ol^{145 116}¹⁴⁵
^Source:^Prepa^{red by CRS on t}^h^e^{basis of the P}^{resident’s FY20}⁰⁹^{Budget documents}^{and HUD Co}^{ngressional Budget}
^{Justifications.}
The President’s FY2009 budget requests a total of $116 million for the programs under the Office
of Lead Hazard Control. This would be a reduction of $29 million from the FY2008
appropriation.
The Senate committee recommends an appropriation of $145 million, the same as the FY2008
level. The committee noted that lead poisoning remains a serious childhood environmental
condition and that significant lead risks remain in privately owned housing, particularly in
unsubsidized low-income units. The committee encouraged HUD to work with grantees on its
lead-based paint abatement hazards programs so that information is disclosed to the public on
lead hazard abatements, risk assessment data, and blood lead levels through publications and
internet sites.
OFHEO is the office within HUD that is responsible for regulating the safety and soundness of
Fannie Mae’s and Freddie Mac’s operations. The appropriations for OFHEO are completely offset
by fees collected from Fannie Mae and Freddie Mac. For FY2009, the Budget and the Senate
committee recommend an appropriation of over $66 million, an increase of $600,000 over the
FY2008 appropriation.
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