February 14, 2006

Congressman Barney Frank, the senior Democrat on the House Financial Services Committee, decried the huge reductions in funding for housing programs that are proposed in President Bush,s proposed 2007 budget, which became public last week. Pledging to make the fight against the proposed budget cuts a top priority, Frank issued the following statement.

"It is widely understood that America faces a housing crisis - in fact a recent study issued by the Administration,s own Department of Housing and Urban Development entitled Affordable Housing Needs found that 11.4 million Americans 'have worst case housing needs,, meaning that they 'do not receive housing assistance, and…have a severe housing problem known as a "priority" problem.,

"President Bush,s response to this crisis, embodied in the 2007 budget proposal he has put forward, is to make the 'worst, even worse. While asking for well over $100 billion in tax cuts and to finance the war in Iraq, he is at the same time proposing that we cut back on virtually every federal program that helps low and moderate income people, particularly those who live in cities. The proposed housing cuts are a prime example of the President,s misplaced priorities.

"The net reduction in funding for HUD,s housing programs contained in the President,s 2007 budget is $1.15 billion. But, at least the President can,t be accused of generational inequity in parceling out his proposed cuts. He is seeking roughly a 25% reduction in funding for both elderly housing and lead paint abatement, which is used primarily to protect children."

The proposed cuts include the following:

• $118 million cut for Section 811 disabled housing [a 50% cut] - including a proposal Congress rejected last year to eliminate funding for construction of affordable rental units for disabled persons.
• $190 million cut for Section 202 elderly housing [a 26% cut].
• $736 million cut for Community Development Block Grants (CDBG) [a 20% cut] - which are used for community development and housing for our nation,s cities and counties.
• $459 million cut for public housing [an 8% cut] - including the elimination of the very important HOPE VI program to revitalize obsolete public housing projects.
• $35 million cut for lead paint prevention and remediation [a 23% cut].
• Elimination of all funding for the construction or preservation of affordable housing units in rural areas.
• Zero funding for a range of economic and community development programs, including Brownfields Redevelopment Grants, Urban Empowerment Zones, the National Community Development Initiative, and CDBG Section 108 loans.