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Nixon Peabody's Affordable Housing Blog

What's now and next in affordable housing and community development from Nixon Peabody LLP.

Reactions to the Trump administration’s proposed budget

Reactions to the Trump administration’s proposed budget

The President of the National Low Income Housing Coalition (NLIHC), Diane Yentel, released a statement last week in response to the Trump administration’s budget proposal, specifically regarding the previously mentioned cuts to (and of) key housing assistance programs at HUD. The official position of the NLIHC is “[the budget proposal] is the wrong approach. Mr. Trump and Congress should be increasing investments in affordable homes-not dramatically cutting resources”. Yentel and the NLIHC further implored Congress to reject the proposed cuts, should they remain a part of the final budget proposal, citing them as “unacceptable”. The statement put out by Yentel and the NLIHC also highlights Secretary Carson’s previous commitment to maintain existing HUD programs, and to refrain from any drastic cuts until an alternative program is created in its place.

Yentel and the NLIHC  released a further statement highlighting the parallels between the Trump administration and the Reagan administration’s seeming hostility towards key HUD programs. The fear expressed, which is not unfounded, is that by completely slashing programs such as Choice Neighborhood Grants and Community Development Block Grants, already distressed communities nationwide would see a spike in homelessness. The statement also points out that President Trump has, in effect, broken his campaign promise to revitalize communities nationwide.

The National Housing Conference (NHC) also released a statement concerning the Trump administration’s budget proposal. The NHC statement points out that in addition to the impact felt by HUD cuts, cuts to the Departments of Agriculture and the Treasury will also negatively impact housing and community development efforts nationwide. Concerning the budget’s potential disruption, the President and CEO of the NHC, Chris Estes, stated “President Trump’s budget for HUD would severely limit the ability of state and local governments to meet their communities’ housing and infrastructure needs.” The NHC statement further emphasizes the importance of both HUD and USDA assistance in the fight to “provide access to affordable homes in urban, rural and suburban communities” and preventing “difficult choices between paying the rent and paying for other essentials like medical care”.

On a final note, having been able to review what the administration calls the "skinny" budget proposal, at this point, there seems to be a belief within the administration that “efforts funded by philanthropy and other more flexible private sector investments” and a general devolution of authority to state and local actors can occur without significant investment from the Federal government. To echo the sentiments of the NLIHC, the NHC, and many others in the industry, this approach will likely create more problems than it will solve. Without Federal investment, state and local programs, particularly those in less well-to-do areas of the country, cannot hold themselves afloat for long, even with a promise of support from the private sector. Simply put, no entity has the resources of the Federal government, and taking away that variable reshapes the affordable housing industry in a negative way.

Authored by Richard M. Price, partner in Nixon Peabody's Affordable Housing practice in Washington, D.C., and prepared with the assistance of Benjamin M. Price, MPP.

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