Big change is underway in Washington, DC! On Jan. 20, Inauguration Day, the same party will take control of both Congress and the White House. This was also the case at the beginning of the Obama, W. Bush and Clinton administrations. The result was that all three administrations were able to get major legislation passed very early.
There is little information coming from the Trump administration’s transition team about policy. But, there are some things we can plan for based on what we do know.
Affordable Care Act
In January, Republican leaders will attempt to pass a bill repealing the Affordable Care Act (ACA), including Medicaid expansion, with no replacement. We expect them to make a promise to replace it later.
In my opinion, it is as unlikely that a later “replacement” will include comprehensive medical care for all the people covered by Medicaid expansion. The progress that expansion states have made to use Medicaid as part of permanent supportive housing would be largely out the window.
However, there are 20 Republican Senators from expansion states, and it is possible that many will refuse to vote to repeal health care for their constituents.
FY17 Appropriations
Congress just passed a short-term extension to push back a final decision on spending for discretionary programs for FY 2017 until April 28. This includes next year’s Continuum of Care (CoC) and other housing and homeless-specific funding.
With decisions delayed again, fighting will continue over spending priorities.
So far, strong advocacy efforts by many of you have resulted in a good chance of an increase for the U.S. Department of Housing Urban Development’s (HUD) homeless assistance programs and other important accounts. A good result will require this work to continue – tell Congress how HUD funded homeless assistance programs are working in your community. Share your success stories with the Campaign for Housing and Community Development Funding.
Investing in Infrastructure
President-elect Trump stressed the importance of investing in infrastructure during his campaign, and there may be a bill introduces. Infrastructure, in this context, refers to services and facilities that are necessary for the economy to function well, but are not produced by the normal operation of the economy.
Housing for low-wage workers and their families definitely fits within this idea.
If the Trump Administration is serious about adopting an infrastructure package with bipartisan support, it may provide opportunities for more investment in housing for Americans who are homeless or at risk of homelessness.
Spending Limits
Through the FY18 budget process, Congress will set discretionary spending allocations for HUD and other agencies, including how much to provide for homeless assistance. FY18 will feature overall spending caps, one for the military and another one for everything else that are back to the so-called sequestration levels set in 2011.
This would mean substantial reductions in capacity for many programs. Congress could make a budget deal, as it has for the past four years, to raise the caps equally for defense and nondefense, leaving more room for investment in programs that house people.
Entitlement Programs
The FY18 budget could result in broad overhauls in entitlement programs. Congress would make these broad overhauls in an effort to reduce long-term spending.
The biggest concern is either a block grant or a “per capita cap” of Medicaid — cutting spending and leaving implementation up to states. Since Medicaid is a lifeline for many people experiencing homeless, these proposals could seriously decrease the number of homeless people Medicaid could serve. Congress could propose similar changes to the Supplemental Nutrition Assistance Program (SNAP, or food stamps).
Tax Reform
The Trump administration and Congressional leaders have shown great interest in tax reform, either as part of the FY18 budget or in a separate bill. This could bring opportunities as well as dangers.
There is growing support for changing the large housing subsidies provided to the wealthiest Americans through the tax system (mortgage interest deduction), and rebalancing them to provide rent subsidies for the poorest Americans.
Congress will also need to address the Low-Income Housing Tax Credit, so that it can continue to pay for building new housing for low-income people.
Reform of Fannie Mae and Freddie Mac
There may once again be an effort to change the way the federal government provides a backstop to home mortgages. One proposed and popular bill to do so, in 2014, included funding for the National Housing Trust Fund, as does the current system of GSEs such as Fannie Mae and Freddie Mac. There remain basic disagreements in Congress, however, so the prospects for legislation remain unclear.
Housing Programs and the National Housing Trust Fund
Congressional leaders have expressed some interest in block granting HUD’s large housing programs, particularly the housing choice voucher program. However, this program gets good result and is based firmly in the private market. States generally have little or no experience running large rent subsidy programs, making it unlikely they could improve the program.
Another danger would be an attack on the National Housing Trust Fund, which just this year is finally producing funding for states to use for affordable housing development.
These are big issues. Worst-case scenarios would include major damage to our work and to the well-being of millions of Americans. On the other hand, there may be opportunities. To protect the most vulnerable people, we need the bipartisan support for work on homelessness to continue. We will need your help to make sure that the people who represent you in Congress understand how homelessness affects your community, what you’re doing about it, and how the issues above would affect your work. Be in touch, we’re always happy to help.