Rural housing programs received modest increases in a long-delayed fiscal 2022 federal budget.
Congress finished work on the omnibus package last week, and President Biden is expected to sign it. Most U.S. Department of Agriculture (USDA) rural housing accounts received small funding hikes, while many Housing and Urban Development (HUD) programs received larger increases.
The most significant USDA increase is in the Sec. 502 single-family direct loan program for low-income home ownership, which is funded at $1.25 billion, up from $1.0 billion in both 2021 and 2020. The Biden budget request sought $1.5 billion for this program. The program received a separate new $657 million in the American Rescue Plan Act, passed earlier this year. The Sec. 502 guaranteed homeownership program, in which USDA insures private mortgages, received authority for $30 billion in loans, an increase from $24 billion in 2021 and 2020.
USDA home repair, rental housing, self-help homes, and several other programs all received modest increases.
The Housing Assistance Council (HAC) in an analysis notes that the budget “does not include the significant boosts for rental housing that were included in House and/or Senate versions, instead compromising on smaller raises.”
Even with modest funding, these figures are better than Donald Trump’s proposed budgets, which each year called for steep cuts for housing and other programs serving rural America. USDA’s rural housing programs would have been mostly eliminated. Congress in all years of the Trump administration rejected those cuts on a bipartisan basis.
HAC also says that the final bill “continues the 10-20-30 requirement that at least 10% of most USDA Rural Development programs, including most housing programs, be set aside for persistent poverty counties (counties where the poverty rate has been at least 20% for 30 years).”
One new program created in the legislation is an Institute for Rural Partnerships. Housed at four universities, this body’s charge is to research “the causes and conditions of challenges facing rural areas and develop community partnerships to address such challenges.”
Despite its name, programs of the U.S. Department of Housing and Urban Development are often a very important funding source for rural and suburban areas as well as cities. The final omnibus package includes substantial increases in many HUD programs. Funding boosts are provided for 25,000 new rental vouchers and for HOME (Home Investment Partnerships Program), Community Development Block Grants (CDBG), public housing, homeless assistance, Indian housing, fair housing, and programs for seniors and the disabled.
HAC’s analysis points out that the “substantial increase in CDBG funding was driven nearly entirely by the return, after a 10-year absence, of $1.5 billion for … funding [of] Community Projects/Congressionally Directed Spending (popularly known as ‘earmarks’).”
Congress now turns to budget decisions for FY 2023, which begins October 1, 2022. To follow progress on that work, see the Housing Assistance Council’s tracking at www.ruralhome.org and National Low-Income Housing Coalition’s at www.nlihc.org.
Joe Belden is a consultant and writer based in Washington, D.C.