#095 Sep/Oct 1997

Congress Passes HUD Budget,Worsens Mark-To-Market Bill

The conference report for the FY98 HUD/VA Appropriations bill easily passed the House and Senate the second week of October. The bill contains roughly $24 billion in HUD funding for […]

The conference report for the FY98 HUD/VA Appropriations bill easily passed the House and Senate the second week of October. The bill contains roughly $24 billion in HUD funding for the fiscal year that began October 1. Compared to recent years, many programs fared well, and there is enough funding to renew all expiring project-based Section 8 contracts. Congress allocated no money for the Preservation program, however, and, for the third year in a row, no funding for new or incremental Section 8.

In a blow to nonprofit fair housing efforts, language was retained prohibiting the use of federal fair housing funds to combat discrimination in the sale of homeowner’s insurance. The HUD/VA bill extends a number of other non-funding related provisions from prior years, such as suspension of one-for-one replacement in public housing and of federal preferences in public and assisted housing.

After a protracted effort to reach consensus, legislation to reform the FHA-insured, project-based Section 8 housing stock was finally enacted as part of the FY98 spending bill. The so-called mark-to-market bill reduces the federal subsidies to owners of such properties, lowers the above-market rents, and restructures their mortgages so that the buildings can survive on less income.

As the dust settles, it appears that Senator Mack’s original bill (S 513) [See Shelterforce # 94] was made substantially worse in order to appease HUD and some House members. According to the National Housing Law Project, the final version of the bill includes changes that could mean bad news for residents and for the future of this precious affordable housing resource.

Requirements for resident and citizen participation were watered down, weakening the processes for participation and reducing the number of events in which resident participation will be required. This means the entities handling the restructuring – state housing finance agencies will receive first preference to assume this role – will have far greater discretion. Also, the amount of funding available for technical assistance will be capped at $10 million a year. Advocates had hoped that unspent technical assistance (ITAG) funds could be used in addition to the $10 million already authorized. Instead, those unspent funds will be included with authorized new funds.

The diluted resident participation provisions are particularly disturbing in light of the bill’s increased focus on vouchering out the project-based stock. The original Mack bill would have kept the project-based subsidies intact. The final legislation, on the other hand, gives the administering entities (PAEs) broad discretion to consider a conversion to tenant-based assistance – a move residents and advocates have long opposed. Every project that undergoes restructuring will now require a conversion assessment plan, even those projects which the PAE is not considering for conversion. Projects for the elderly and disabled, and those in tight housing markets, will be exempt. Residents who are displaced by conversion will receive “enhanced” vouchers, but residents in buildings that lose the project-based subsidy because the owners opt out of the program or are disqualified will not get enhanced vouchers.

For up-to-date information, contact Lisa Ranghelli, Center for Community Change, 202-342-0567; [email protected].

From the Center for Community Change and the Tri-State Transportation Campaign
Advocates Sweeten ISTEA

by Crystal Weedal

The gulf between Senate and House efforts to reauthorize the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) widened considerably this October. The House transportation committee decided to put off for six months major reauthorization of ISTEA – which provides $24 billion annually for transportation – while Senate committees developed a six-year reauthorization bill scheduled to reach the Senate floor in October.

The Center for Community Change worked with national and local allies to gain significant improvements to the Senate bill. The bill contains: $100 million for Access to Jobs, to help welfare recipients and other low-income people get to work; a requirement that mass transit users be represented on Metropolitan Planning Organizations (MPOs), which determine how transportation dollars are spent within their jurisdiction; and a requirement that MPOs provide the public with information every year on the location and funding of projects.

Senator Moseley-Braun’s (D-IL) Access to Jobs program was added as an amendment to the Senate bill during the Senate Banking Committee mark-up. It would help people at up to 150 percent of the poverty line get to work. Sixty percent of the money would go to large urban areas, 20 percent to small urban areas, and 20 percent to rural areas.

Jurisdiction over the reauthorization of ISTEA is split between the Senate Environment and Public Works Committee, which has authorization over the bill’s highway portion, and the Senate Banking Committee, which has authorization over mass transit. Both have jurisdiction over the MPO process.

In recent months, the House worked on a three-year bill called the Building Efficient Surface Transportation and Equity Act of 1997 (BESTEA). BESTEA would spend in three years the funds allocated to transportation over the next five. The Republican leadership opposes BESTEA because it would bust the spending caps in the budget agreement. House Transportation and Infrastructure Chairman Bud Shuster (R-PA) reached a compromise with House leadership and substituted a six-month bill for BESTEA in the hope that more money would be allocated to transportation in the future. The six-month bill contained no substantial policy or funding changes from the current ISTEA legislation.

BESTEA also includes an Access to Jobs program that would help current and recent Temporary Assistance to Needy Families (TANF) recipients get to work. The funding level for this program is set at $42 million and would be for 10 demonstration projects. Six of these projects would be in large urban areas, two would be in small urban areas, and two would be in rural areas.

CCC and other advocates plan to continue pushing for expanded public participation features and a requirement that MPOs disclose information on the location and cost of transportation projects. BESTEA included neither of these provisions.

Environmental organizations around the country are mobilizing to strike language from the Senate bill that would compromise environmental review of highway projects and represent a first step toward dismantling basic environmental protections enshrined in law since 1970. Washington transportation reform advocates are also looking out for Senate floor amendments that would attack ISTEA’s air quality program.

Once the House and Senate pass their bills, the conference to reconcile will be especially difficult because of the difference in the length of the two bills. Traditionally, the shorter term measure prevails when the two houses offer such radically divergent bills. Activists are asked to call their Senators and Representatives to urge them to support the inclusion of the Access to Jobs, public participation, and disclosure provisions in the final bill.

Contact Lisa Ranghelli, 202-342-0567, [email protected]; or Tri-State Transportation Campaign, 212-777-8181.


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