We Finally Have a FY 2018 Budget. And There’s Good News.

Congress has now passed (and the president signed) a final government funding bill for fiscal year (FY) 2018. It includes plenty of good news for people working to end homelessness. This bill implements the budget deal that was passed several weeks ago, making substantial new funding available for federal programs.

This analysis will focus on funding changes for the U.S. Department of Housing and Urban Development (HUD) since HUD’s anti-homelessness programs are funded in the most detail at the congressional level. As we’re able to parse out details for other federal departments, we’ll share that information as well.

Homeless Assistance Grants

First, HUD’s Homeless Assistance Grants received an additional $130 million compared with FY 2017, bringing total funding to $2.513 billion. This will cover increased costs from rising rents, and fund a net increase in programs. We estimate that this increase will be enough to move an additional 20,000–25,000 people from homelessness to housing over the course of the year. The increased capacity will be targeted to homeless youth and homeless domestic violence survivors. This is the third year in a row with increases greater than $100 million.

Section 8

Next, Section 8 received expanded capacity. Renewals are fully funded for both project-based Section 8 and vouchers—this relieves the downsizing pressure that’s existed since the 2013 “sequestration” year. There are additional funds for new “incremental” vouchers: $40 million for HUD-Veterans Affairs Supportive Housing for homeless veterans with disabilities, $20 million for the Family Unification Program for families and youth in the child welfare system, and approximately $385 million for “811 vouchers” for people with disabilities. That money will provide approximately 60,000 new vouchers for vulnerable Americans.

Housing Development

Much of the focus of the spending bill was on “infrastructure,” and some of the increased HUD funding will go toward programs that build or rehabilitate housing. Public Housing received an increase of $800 million to catch up on deferred rehabilitation needs and preserve apartments that would otherwise be unavailable to live in. Accounts that are used to build or rehab affordable housing in the private sector also received substantial increases: HOME Investment Partnerships Program (HOME) is up by $400 million, and the Community Development Block Grant (CDBG) program up by $300 million. There was also a 12.5% increase in Low-Income Housing Tax Credits (LIHTC).

Of course, this last group of programs (HOME, CDBG, and LIHTC) can be used for housing that requires substantially more income than people have when they are homeless. How much will go to housing that’s really affordable to people with the lowest incomes? That will depend on decisions at the state and local levels, by mayors, governors, and others.

Overall, the ten largest HUD accounts increased by $4.4 billion and are at the highest level ever. Programs that are most targeted to people with the lowest income got $3.5 billion of that. This is by far the largest one-year increase in at least the last 20 years. While it is the result of many factors, there is no doubt that a rising chorus of diverse voices, decrying the prevalence of homelessness and the lack of stable housing for many Americans, played a major role, as did the well-earned impression that these programs achieve good results.