Pelosi, Lantos, and Eshoo Request Additional Funding for Public Housing

Pelosi, Lantos, and Eshoo Request Additional Funding for Public Housing

Thursday, October 5, 2006

Contact: Brendan Daly/Jennifer Crider, 202-226-7616

Washington, D.C. â€" House Democratic Leader Nancy Pelosi, Congressman Tom Lantos, and Congresswoman Anna Eshoo sent the following letter to the Chairmen and Ranking Members of the Appropriations Committee and the Transportation-Treasury-Housing Subcommittee today requesting supplemental funding for public housing to cover shortfalls in fiscal year 2006 and fiscal year 2007 funding.

Below is the text of the letter:

October 5, 2006

The Honorable Jerry Lewis
Chairman
House Appropriations Committee
H-218 The Capitol
U.S. House of Representatives

The Honorable David R. Obey
Ranking Member
House Appropriations Committee
1016 Longworth HOB
U.S. House of Representatives

The Honorable Joe Knollenberg
Chairman
Transportation-Treasury-Housing Subcommittee
U.S. House of Representatives

The Honorable John W. Olver
Ranking Member
Transportation-Treasury-Housing Subcommittee
1016 Longworth HOB
U.S. House of Representatives

Dear Chairman Lewis, Ranking Member Obey, Subcommittee Chairman Knollenberg, and Ranking Member Olver:

Thank you for your leadership on the Appropriations Committee. We would like to draw your attention to the deep cuts in funding that face the San Francisco Housing Authority (SFHA) and San Mateo Housing Authority (SMHA), as well as hundreds of other housing authorities throughout the nation. San Francisco and San Mateo Counties have worked to improve their public housing communities and revitalize distressed public housing, but the continual cuts to public housing budgets are greatly hampering these efforts.

This year, SFHA’s funds to operate its approximately 6,300 units and SMHA’s operating funds for its 180 units have already been reduced twice. These agencies received only 92 percent or less of needed funds in FY2006. Due largely to increases in the cost of utilities, SFHA received only 85 percent of needed funds during the second half of the year.

If the President’s FY 2007 budget request for public housing operating funds is adopted by Congress, SFHA and SMHA will suffer another serious blow to their viability. Using the formula developed by the US Department of Housing and Urban Development (HUD), the proposed funding will cover only about 78 percent of the public housing authorities’ expenses. For SFHA, this shortfall will result in a loss of over $4 million, in addition to the losses in 2006. For SMHA, the shortfall in operating subsidies will be almost $80,000, a large amount of funding to lose in relation to the number of their housing units.

In addition, under HUD’s new formula for distributing public housing operating funds, SFHA and SMHA are among many housing authorities that will lose funding, and SFHA is among the ten cities that will lose the most. HUD will limit SFHA’s losses to five percent if the agency converts to a new system of budgeting, but HUD’s only recently published guidance has not provided enough time for housing authorities to make the transition.

We are asking the Committee to alleviate these devastating cuts to the operating funds of SFHA, SMHA, and other public housing agencies. We are seeking supplemental funding of $283 million to cover shortfalls for FY06 due to increased utility costs and an additional $900 million above the $3.6 billion reported by the Senate Appropriations Committee for FY07 to meet the housing authorities’ urgent operating subsidy formula needs. Regarding HUD’s regulations changing the formula and budgeting procedures for housing authorities, we ask the Committee to accept Section 325 of the Senate-reported bill. Section 325 would extend the deadline for compliance with the new asset management system to October 1, 2007. We also ask you to accept Section 324 of the Senate-reported bill. This section simply upholds current law with regard to agencies’ flexible use of public housing capital funds. HUD should not be permitted to impose unauthorized restrictions on current statutory flexibility while simultaneously proposing to provide far less funding than necessary to maintain this affordable housing resource.

SFHA and SMHA are committed to improving the housing and economic opportunities for all of their nearly 12,000 and 500 residents, respectively, but these and other housing agencies nationwide cannot accomplish these important goals without adequate funds.

Sincerely,

Nancy Pelosi
House Democratic Leader

Tom Lantos
Member of Congress

Anna Eshoo
Member of Congress