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President Biden Signs $469 Billion FY 2024 Minibus Spending Bill, with $81.4 Billion in Gross Appropriations for HUD, including $8 Billion Designated as Emergency Funding

Published by Peter Lawrence on Wednesday, March 13, 2024 - 11:02AM

President Biden signed a $469 billion minibus fiscal year (FY) 2024 spending bill March 8, providing discretionary funding for federal agencies covered in six of the 12 annual spending bills, including the U.S. Department of Housing and Urban Development (HUD).

For HUD spending, the FY 2024 minibus bill provides gross appropriations of $81.4 billion, a $10.9 billion (15.4%) increase from FY 2023, $8.11 billion (11.1%) more than the FY 2024 request, $9.91 billion (13.9%) more than the FY 2024 House THUD bill and $8.12 billion more than the Senate FY 2024 THUD bill. However, the bill designates $8 billion of rental assistance funding ($6 billion in tenant-based rental assistance, an increase of $4 billion from FY 2023, and $2 billion in project-based rental assistance) as emergency spending, so only $73.4 billion of HUD gross appropriations counted toward the nondefense discretionary spending cap. Comparing this $73.4 billion in spending under the cap, the bill provides a $4.88 billion (7.1%) increase from FY 2023, $114 million (0.2%) increase from the FY 2024 request, $1.91 billion (2.7%) increase from the House FY 2024 THUD bill, and $120 million (0.2%) increase from the Senate FY 2024 THUD bill.

In general, the bill’s funding levels provide most HUD programs, especially rental assistance programs with modest increases from last year, with a few programs experiencing significant cuts detailed below.

Blog Graphic: Key Programs of the U.S. Departent of the Housing and Urban Development Budget

Public and Assisted Rental Housing

Project-Based Rental Assistance (PBRA)

The legislation provides $16.1 billion for PBRA, which is $1.10 billion (7.4%) more than FY 2023, $106 million (0.7%) more than the FY 2023 request, $109 million (1.2%) more than the House bill and $219 million (1.4%) more than the Senate bill. As noted above, $2 billion of this amount was designated as emergency spending. According to the Senate Appropriations Committee, this funding should be sufficient to renew all rental assistance contracts expiring in FY 2024. The bill does not include additional funding for HUD to provide budget-based rent adjustments to PBRA contracts that have been renewed through the mark-to-market program.

Tenant-Based Rental Assistance

Tenant-based rental assistance is funded at $32.4 billion (including the $6 billion in emergency spending mentioned above, a $4 billion increase from FY 2023), a $2.13 billion (7.1%) increase from FY 2023, $1.25 billion (4.0%) more than the House bill and $649 million (2.0%) more than the Senate bill, but a $316 million (1.0%) decrease from the FY 2024 request. Of that amount, $28.5 billion is for Section 8 Housing Choice Voucher contract renewals, which is $2.09 billion (7.9%) more than FY 2023 and should be sufficient to fund all renewals. Furthermore, there is $30 million in additional incremental family unification voucher funding is expected to house an additional 3,000 households.
 
For the HUD-Veteran Affairs Supportive Housing program, the minibus provides $15 million in new incremental funding, which is $35 million (70%) less than FY 2023, House and Senate bills, but $10 million (200%) more than the request. The legislation also provides $337 million for Tenant Protection Vouchers, the same as FY 2023 and the House bill, but $48 million (12.5%) less than the request and $108 million (24.3%) less than the Senate bill. 

Public Housing

The minibus includes $8.81 billion overall for public housing, $297 million (3.5%) more than FY 2023 and $448 million (5.4%) more than the House bill, but $82 million (3.0%) less than the request and $64 million (0.7%) less than the Senate bill. Of this amount, it provides $3.2 billion for public housing capital subsidies, which is equal to FY 2023 and the Senate bill, but $25 million (0.8%) less than the request and $20 million (0.8%) more than the House bill. The final spending bill also provides $5.48 billion for public housing operating subsidies, which is $367 million (7.2%) more than FY 2023, $343 million (6.7%) more than the request, and $373 million (7.3%) more than the House bill, but $54 million (1.0%) less than the Senate bill.

Rental Assistance Demonstration (RAD)

The minibus bill does not include the request to eliminate the September 2024 sunset on the RAD program, nor does it authorize an increase in the public housing conversion cap, but it does extend the expiration date to September 2029. The FY 2018 minibus increased authorization from 225,000 to 455,000 public housing apartments. Also as expected, the minibus bill does not provide incremental funding to facilitate conversions, as proposed by the request ($112 million), but includes language to authorize conversions of Section 811 housing for people with disabilities.

Choice Neighborhoods Initiative

The minibus bill provides only $75 million for the Choice Neighborhoods Initiative, which is $275 million (78.6%) less than FY 2023, $110 million (59.5%) less than the request and $75 million (50%) less than the Senate bill, but $75 million more than the House bill, which proposed to defund the program. As a program that finances future housing, as opposed to financing housing for existing assisted households, Choice Neighborhoods is a vulnerable program.

Community Development Block Grants and HOME Programs

The minibus provides $3.3 billion for Community Development Block Grant (CDBG) formula grants, which is equal to FY 2023, the request, and the House and Senate bills. However, like the FY 2022 and FY 2023 HUD spending bills, the bill provides $3.29 billion in Economic Development Initiatives, better known as “earmarks” or congressionally directed spending, $308 million (10.3%) more than FY 2023, $1.07 billion (47.9%) more than the House bill and $2.23 billion (210%) more than the Senate bill (administration budget requests never include earmarks). Such earmarks were considered crucial in facilitating votes for spending bills in the past, as they included specific funding requests for developments in member districts and states. After considering a ban for the 118th (next) Congress, House Republicans voted to retain earmarks for future spending bills.

In addition to the CDBG formula grants and earmarks, the minibus includes $100 million in competitive CDBG grants to states and local governments, metropolitan planning organizations and other eligible entities to incentivize the elimination of exclusionary, restrictive zoning and land uses to advance fair housing and support the creation of affordable housing in every community, the YIMBY incentive grant program, equal to the Senate bill, a $15 million (17.6%) increase from FY 2023 and the request, and $100 million more than the House bill.

Lastly, the bill also provides $1.25 billion for the HOME Investment Partnership Program, which is $250 million (16.7%) less than FY 2023 and the Senate bill, $550 million (30.6%) less than the request, but $750 million (150%) more than the House bill.

Manufactured Housing Communities Program

Furthermore, the minibus continues to include competitive grants for the Preservation and Reinvestment Initiative for Community Enhancement (PRICE) to preserve and revitalize manufactured housing and resident-owned manufactured housing communities for the benefit of residents and long-term affordability of their communities. However, the funding is reduced significantly to $10 million from the $225 million provided in FY 2023, which is still $10 million more than the request and the Senate bill, both of which had proposed no funding for the program, but $10 million less than the House bill.

Homeless and Supportive Housing Programs

McKinney-Vento Homeless Assistance Grants are funded at $4.05 billion, $418 million (11.5%) more than FY 2023, $302 million (8.1%) more than the request, $322 million (8.6%) more than the House bill and $143 million (3.7%) more than the Senate bill. This amount includes a $3.54 billion set-aside for the continuum of care and rural housing stability assistance programs and $290 million for Emergency Solutions Grants. It also provides $107 million to continue implementation of comprehensive approaches to preventing and ending youth homelessness, and $100 million for one-time awards for new construction, acquisition of rehabilitation of new permanent supportive housing.

The minibus bill provides $913 million for the Housing for the Elderly (Section 202) program, equal to the House bill, but $162 million (15.1%) less than FY 2023 and the Senate bill, and $110 million (10.8%) less than the request. The bill also provides This amount fully funds all annual rental assistance contract renewals and amendments, but no funding for new capital advances or new project rental assistance contracts, $110 million less than FY 2023. 

The Housing for Persons with Disabilities (Section 811) program is funded at $208 million, equal to the House bill, but $152 million (42.2%) less than FY 2023 and the Senate bill, and $148 million (41.6%) less than the request. Like Section 202, the reduction in funding reflects no funding for new capital advances or new project rental assistance contracts.
The minibus bill provides $505 million for the Housing Opportunities for Persons with AIDS program to provide housing and supportive services, equal to the request, House and Senate bills, and $6 million (1.2%) more than FY 2023.

Next Steps

With the enactment of the first FY 2024 minibus spending bill, Congress is poised to consider the second FY 2024 minibus spending bill providing funding to the rest of the government, likely during the week of March 18. While the second minibus spending bill is more controversial and difficult to find an agreement, especially for the Homeland Security spending bill, it is expected Congress will pass and then President Biden will sign the legislation before the March 22 deadline. The second minibus could serve as a vehicle for the Tax Relief for American Workers and Families Act, H.R. 7024, the tax bill currently pending in the Senate, which includes LIHTC proposals similar to those in the Affordable Housing Credit Improvement Act (AHCIA, H.R. 3238, S. 1557) to restore the 12.5% increase in 9% allocations for 2023-2025 and lower the private activity bond financing threshold from 50% to 30% in 2024-2025. Novogradac estimates they will finance more than 200,000 new and preserved affordable rental homes.

While there is some pressure on the Senate to address the pending tax bill given the overwhelming 357-70 bipartisan vote to pass the bill in the House, the timing and likelihood of passage is uncertain. Senate Finance Committee Chair Ron Wyden, D-Oregon, has set a target of April 15 for enactment and negotiations between Wyden and Senate Finance Committee Ranking Member Mike Crapo, R-Idaho, on the tax bill are ongoing, but there is no action-forcing event driving that deadline outside of political considerations. As the presidential election draws closer, the harder it will be to advance the bill.

With the end of the FY 2024 appropriations process in sight, attention will turn to the FY 2025 budget request. A future Notes from Novogradac blogpost will cover the highlights of the request, building upon the blog covering the White House Factsheet on Housing Proposals in the FY 2025 budget.

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