What the President’s Proposed FY23 Budget Means for Homelessness

President Biden released his proposed federal budget earlier this week, covering Fiscal Year 2023 (FY23), which begins October 1 of this year.

Each year, the President’s budget is a coherent statement of the Administration’s spending, taxing, and accompanying policy proposals. It seeks to set the agenda for policymaking for the coming year. That’s important – and this year’s could have a major impact on homelessness.

All of the taxing and spending (and most of the big policy) changes have to be passed into law by Congress. In the first year of the Biden Administration, not all budget proposals were actually passed. Spending on homelessness programs is a good example. Last year – and for eleven of the twenty years since the early George W. Bush Administration – the President proposed substantial increases in spending (more than 10 percent) for the Homeless Assistance account at the U.S. Department of Housing and Urban Development (HUD). Congress provided the substantial increase requested by the President in zero of those 11 years. (Congress was consistent, however, enacting smaller increases every year since FY 2002.)

What the President’s Budget Means for Homelessness Funding

We use the President’s budget, when it’s good, to encourage Congress to go bigger. And this proposal is good: it includes $3.576 billion for Homeless Assistance, an increase of $363 million above the recently enacted FY 2022 amount. That would be the largest increase since the program was first ramped up in the early 1990s, and would be enough to cover rent increases and start some new projects. This account funds the Continuum of Care program, funding communities’ homelessness systems and paying rent for people moving from homelessness into housing. It also funds Emergency Solutions Grants for shelter, outreach, rapid rehousing, and homelessness prevention.

There is also a proposed increase in Tenant-Based Rental Assistance, the account that pays for the Housing Choice Voucher program, of around $4.7 billion (making the total amount $32.1 billion). According to HUD, this amount would be enough to cover rent increases and add 200,000 new vouchers to the stock – providing permanent rent subsidies in their own apartments to people who are homeless or at risk of homelessness, and who are fleeing domestic and other violence. Overall, the budget proposes increasing HUD spending by $12 billion over the FY 2022 enacted amount.

How New Proposals Could Impact Housing

In addition to increases in existing programs, the budget also proposes a $35 billion new program to develop additional affordable housing, combined with a $15 billion increase in Low-Income Housing Tax Credits. There is not a lot of detail about this proposal, but it has some potential to recruit new allies in Congress, for the sake of producing new housing where vouchers could be used.

There are also new proposals related to health care, employment, and other important topics in addition to housing. Given that many of these items overlap with the needs of people experiencing homelessness, the Alliance will be going over the budget request in detail. We will need the Administration to put its energy behind these proposals, and members of Congress who care about homelessness to lend their support.

Moving Forward

What will Congress do with this? That remains to be seen. The budget was released later than usual this year. Usually, in high-stakes election years like this one, work on considering the budget starts at a frantic pace, then stops dead in the early fall, to be picked up after the election. The Congressional election coming up in November will distract from the work of getting bills enacted – but we can’t let this stand in the way of making progress on ending homelessness. Please count on the Alliance to keep everyone informed on how it’s going this year.