The community economic development industry faces elimination of several programs and cuts to numerous others in the proposed spending plan presented by George W. Bush on Monday, April 9, 2001.
Community development advocates should be concerned that the budget resolution for FY 2002, the unfair and excessive tax cuts, elimination of the estate tax and the Bush spending plan will greatly reduce future levels of funding for housing production and management, business and job creation, and capital access.
Overall, the Bush administration’s budget plan would reduce spending on community economic development programs by 5 percent in FY 2002. However, the spending framework that the plan would establish requires significantly larger cuts every year through FY 2012. The administration’s FY 2002 budget places an unfair burden and forces real cuts in spending on programs and resources to revitalize low-income communities. Specifically, the FY 2002 budget will:
• Eliminate many programs that community organizations use for job creation and housing activities such as the Assets for Independence Act, Rural Housing and Community Development, Environmental Justice, and Sustainable Development Challenge Grants.
• Undermine implementation of the recently enacted New Markets program by drastically cutting the Community Development Financial Institutions Fund and eliminating the New Markets Venture Capital Fund.
• Cut funding for the development of affordable housing, including HOME funds, Youthbuild, and many other HUD programs, such as Homeless Assistance Grants.
• Cut core community economic development programs such as the Community Development Block Grants and EDA, as well as programs focused on economic development activities in rural communities.
Based on the emerging debate, it is clear that Bush and the Republican leadership will need to make several concessions on budget issues before this process concludes this fall. However, this will only occur if legislators hear from their constituents on these issues.
For draft letters and specific budget information, visit http://www.ncced.org/policy