President Obama released his budget proposal for fiscal year 2011 on Monday; it includes several exciting new initiatives but several cuts to housing programs.  Congress will use the budget proposal as a guide to craft appropriations bills which fund the federal government for the next fiscal year.

Highlights of the President's budget, pulled from analysis from the National Alliance to End Homelessness, include:

Housing and Services for Homeless Persons Demonstration
This new proposal would combine HUD housing vouchers with funding from HHS mainstream programs to serve approximately 10,000 homeless or at-risk households. It has two components:
· HUD and HHS will combine 4,000 Section 8 Housing Choice Vouchers and $16 million in HHS funding (the equivalent of $4,000 per unit) to serve chronically homeless individuals who are enrolled in certain Medicaid programs.  
· HUD, HHS, and Department of Education will work together to implement a housing and services program for 6,000 families who are homeless or at risk of homelessness. HUD will provide Section 8 Housing Choice Vouchers targeted to communities with high concentrations of homeless families.

Applicants will need to demonstrate how they are coordinating these vouchers with State TANF assistance, and the Department of Education will help identify at-risk families through its network of homeless liaisons and provide education services.  

TANF Emergency Contingency Fund
The budget proposes to extend supplemental funding for the TANF Emergency Contingency fund for an additional year. This would give states up to $2.5 billion for short-term emergency assistance, including for housing, supported employment, or to cover additional families.

Increase in Homeless Assistance Grants (McKinney Continuum of Care funds)
The budget proposes a $190 million increase (10%) to $2.055 billion. This will be the first budget that implements the HEARTH Act.

The budget proposes $200 million for the Emergency Solutions Grant (ESG). This is an increase of $40 million over the FY 2010 level for the ESG program, but approximately $200-$250 million less than would be allocated to ESG if the HEARTH Act was fully implemented.  

50% increase in funding for the VA's homeless assistance programs

Tenant-Based Rental Assistance/Section 8 Housing Choice Vouchers
The budget proposes a $1.4 billion increase for tenant-based rental assistance (Section 8 or Housing Choice Voucher program.) HUD projects that this request will serve 34,466 more households than in FY 2010.

Housing Trust Fund
HUD proposes $1 billion for the National Housing Trust Fund, which would primarily create rental housing for extremely low income households. The $1 billion would be mandatory spending, which means that Congress would have to pass legislation separate from the regular appropriations process for the money to become available.

Project-Based Rental Assistance
The Administration's budget proposes to increase funding for the project-based voucher program by over $800 million to $9.4 billion, which the Administration estimates is sufficient to renew all projects for a full 12 months. Note: This is not the program that allows PHAs to fund new project-based vouchers. New project-based vouchers are usually funded through the Tenant-Based Rental Assistance account. The Project-Based Rental Assistance program funds contracts that were made directly between HUD and property owners many years ago.  

The budget also proposes cuts to the Community Development Block Grant (CDBG), HOME, Section 811 and Section 202. 

Click here for full coverage of the budget proposal's impact on homelessness from the National Alliance to End Homelessness.

Click here for information on the budget proposal's impact on affordable housing from the National Low Income Housing Coalition.