What We Know (and Don’t) About Those Congressional Budget Plans

March 25, 2015

I feel I should say something about the Republican House and Senate budget plans, even if a bit late to the pile-on. They are, after all, frameworks for policies that would do grievous harm to people in poverty.

Not up front about this, however. They’re larded with deceptive rhetoric, silent on crucial details and dishonest about revenues. Fortunately, progressive experts have dug into the plans from various angles.

So we know, for example, that the plans purport to balance the budget within 10 years, but wouldn’t. They seem to only because both the House and Senate relied on dynamic scoring models built on the discredited notion that tax cuts will miraculously increase revenues.

That, in and of itself, is a good thing because actually achieving balance so soon would, at the very least, slow our prolonged economic recovery.

What’s not at all a good thing is that the plans move toward balance entirely through spending cuts — about $5.5 trillion in the more radically-right House plan, not much less in the Senate’s.

And defense would not only be held harmless, but actually get a boost, though it’s cleverly designed so as not to affect the budget balance calculation or seem to breach the spending caps set in the 2011 Budget Control Act.

We know the plans would achieve large savings by denying low and moderate-income people the affordable health care they have now. Both would, of course, repeal the Affordable Care Act, including the federal funding that has enabled willing states and the District of Columbia to expand their Medicaid programs.

They would convert what remains of Medicaid into a block grant — or in the case of the Senate, two block grants. The more forthcoming House plan commits to folding the Children’s Health Insurance Program in.

But you won’t find the term “block grant” anywhere in the plans. We’ve instead got the more marketable — and obscure — “State Flexibility Fund” or the equivalent.

Same difference. Though the plans don’t say how the budget would replace the federal matches that now cover more than half states’ Medicaid costs, they do say that savings would total hundreds of billions over the first 10 years — $400 billion in the Senate plan and an even more staggering $913 billion in the House plan.

We also know that the plans would achieve significant additional savings through changes in other mandatory programs, i.e., those that don’t depend on annual appropriations. That’s all we know from the budget figures in the plans.

But the prosy part of the House budget plan reveals that it — like all the plans Congressman Paul Ryan produced while chairing the Budget Committee — would convert SNAP (the food stamp program) to another block grant, a.k.a State Flexibility Fund.

That would cut spending on the program by an estimated $125 billion, beginning in 2021, the Center on Budget and Policy Priorities reports. States would have the flexibility to cope with the funding crunch.

If they made across-the-board benefits cuts, recipients would lose, on average, $55 a month, according to CBPP’s estimates. If they instead made certain categories of recipients ineligible, as many as 12 million people would lose their benefits altogether.

No cuts to Pell grants for low-income college students. But the House plan — again, the more forthcoming — supposedly “makes the program permanently sustainable.” Translated, this means a 10-year freeze on the maximum a student can receive — $5,775 a year.

Don’t suppose I need to say that this is far less than the average costs of attending college. Don’t need to say that these costs can be expected to rise, especially because most states are balancing their budgets in part by hiking tuition.

How the House and Senate Appropriations Committees will divvy up the rest of the savings remains to be seen. Both the House and Senate plans apparently preserve (for real) the cap on non-defense discretionary spending, i.e., for programs whose funding hinges on annual appropriations.

But when we look ahead, we find that these programs would lose many billions more than the caps allow — $759 billion in the House plan and at least $236 billion in the Senate plan.

Put these together with the specified and unspecified cuts in mandatory programs and we come up the trillions cited above because the plans cut only non-defense programs. CBPP figures that more than two-thirds of the money would come from those that serve low-income — and in some cases, moderate-income — people.

Well, these plans aren’t going to result in a final budget that the President will sign. They’re still profoundly worrisome. Because whatever he does sign — and he will sign something — will surely leave key programs for low-income people far short of the funds needed to give them a secure safety net and opportunities to better their financial circumstances.

Even the budget we have now falls short of needs.

 

 


DC Labor Laws on the Books, But Weak or No Enforcement

March 23, 2015

“The law is on the books. Enforce it.” I heard my then-boss, U.S. Civil Rights Commission Chairman Arthur Flemming, say this over and over again when the Reagan administration was insisting that Congress had to change major federal civil rights laws if it wanted them enforced as they’d always been.

Even with the best will in the world, however, an agency can’t ensure laws achieve what they’re supposed to if it doesn’t have enough money for staff. This seems to be in the case in the District of Columbia, judging from several Fair Budget Coalition recommendations.

FBC is again recommending additional funds to “implement and enforce” the District’s existing worker protection laws — a total of $3 million for the upcoming fiscal year.

Somewhat over half would pay for more staff and administrative law judges to enforce compliance with the District’s minimum wage increase and expanded paid sick leave laws, plus some others intended to prevent wage theft, e.g., denying earned overtime pay.

But a modest $292,000 would support steps that must be taken before enforcement can kick in. As things stand now, two laws — the Protecting Pregnant Workers Fairness Act and the Unemployed Workers Anti-Discrimination Act — are basically still just words in electronic files.

The former requires employers to provide reasonable accommodations for workers whose ability to perform their assigned tasks is limited by pregnancy, childbirth, related medical conditions or breastfeeding. No more denying pregnant workers enough bathroom breaks, demanding that they continue lifting heavy packages when their doctors have cautioned against that, etc.

The latter seeks to prevent jobless workers from remaining jobless just because that’s what they are.

The pregnant workers’ legislation is quite new. The timeframe for our Congressional overlords to disapprove it, which they didn’t, expired long about last Thanksgiving Day. But the prohibition against refusing to hire — or consider hiring — someone because s/he’s unemployed cleared the Congressional review period at the end of May 2012.

Yet the Office of Human Rights, which has responsibility for enforcing it, hasn’t proposed rules — let alone published final rules — to spell out what employers can and can’t do and how workers can seek remedies when they believe employers have done what they shouldn’t.

Its website doesn’t even acknowledge the law. Yet only OHR can enforce it because it denies workers the right to seek remedies through lawsuits.

Not the agency’s fault that it’s done nothing. The law conditioned implementation on “the inclusion of its fiscal effect in an approved budget and financial plan.” The Chief Financial Officer determined that the budget couldn’t cover it. That, however, was three years ago. So there’s been plenty of time to fill the gap.

This isn’t the first time the DC Council has passed progressive legislation and then neglected to make sure it was achieving its intent.

Back in 2010, the District’s auditor found that the Department of Employment Services hadn’t monitored publicly-financed projects to ensure that contractors filled at least 51% of new jobs created with District residents, as the First Source Act requires. Left to their own devices, most didn’t.

More to the point perhaps, DOES hadn’t issued final rules for the District’s Living Wage Act, which the Council passed in 2006. Nor did it get around to proposing rules for the amended law until after the auditor reported such findings as she’d been able to make — a time lag of at least a year, maybe more.

The Fenty administration told the auditor that it hadn’t moved forward because a provision in the original living wage law conditioned implementation and enforcement on annual appropriations. No appropriations forthcoming. So it’s likely that some unknown number of D.C. workers were underpaid.

Perhaps still are. The final rules provide for no enforcement unless workers or their representatives file formal complaints of violations. The burden is apparently on them, not DOES to monitor, investigate, document and so forth.

We everyday District residents read of laws the Council has passed to increase employment of our fellow residents, boost their wages and protect them from egregiously unfair treatment.

So it’s distressing that we have to learn from FBC — and ultimately from the Employment Justice Center, which proposed the labor law recommendations — that the responsible agencies aren’t fully and effectively enforcing the laws on the books.

Well, we know now. And so do the Mayor and DC Councilmembers. We have fine advocates here in the District, but I still wish we had Flemming pounding the table now.

 


Insight Gained From Trying to Contact Social Security

February 2, 2015

My husband Jesse’s death has been a learning experience for me in many ways. One thing I’ve learned is why so many Americans who don’t have principled objections to major federal programs hate “big government” — and how spending cuts can build support for more.

Checklists I’d been sent told me that I should notify the Social Security Administration of Jesse’s death so that it would stop deposits to his bank account. Foreseeing, as I now know I shouldn’t have, some impending fraud claim, I went to the SSA website, thinking I could notify the agency there. Wrong.

So I called the 800 number. Recorded messages telling me things I didn’t need to know, e.g., the new cost of living adjustment, the Medicare Part B premium. Then a lengthy Q&A with an interactive program. Then a message telling me my wait time would be 45 minutes, but that I could get a callback instead. Opted for that. No call.

So called again. Same routine. Had to hang up after close to 45 minutes to take other calls. Try again. Same results. Finally decided what I should do is get an appointment at the nearest SSA office. Can’t do that on the website either. And so …. Well, you know what.

I finally got to a live human being after about 50 minutes. She told me I could schedule a telephonic meeting. The first available appointment was nearly six weeks away. For  me, this is really no big deal. But what if I’d depended on Jesse for financial support and urgently needed the ongoing survivor benefits I’d have been entitled to?

Frustrations like those I experienced are directly traceable to inadequate funding that has put the squeeze on services for many years. SSA simply doesn’t have the budget for anything like the number of staff it needs.

This is also the case for the Internal Revenue Service, which may be able to answer only 43% of taxpayer calls this filing season — and for the lucky minority whose wait times pan out, only to answer the most basic questions.

No answers whatever for people who don’t file by April 15. No more personal help with tax returns for low-income, elderly and disabled filers either. Well, what do you expect when the agency’s budget, in real dollars, is about 17% less than in 2010.

“The way Congress has been handling the funding of the IRS, it’s as if it wants us to hate the agency,” Washington Post columnist Michelle Singletary observes. Indeed.

SSA and IRS aren’t the only agencies short-staffed. Blogger Paul Waldman recently posted a pair of charts showing how the federal workforce has shrunk over time. The more telling shows that the number of federal employees per 100,000 residents has dropped by 43% since 1968.

Ramping up automation and other “efficiencies” can do only so much. Only people can, for example, staff the visitors centers in our national parks, protect the wildlife (and the visitors) and plow the snow off the roads so the parks are accessible.

Anyone who knows how angry residents get when streets aren’t swiftly plowed after a snowstorm can imagine how angry some 135,000 people were at our federal government when they learned they couldn’t get into Yellowstone National Park for two weeks after it was scheduled to open.

Chalk this up to budget cuts — including, but not limited to the across-the-board cuts that affected all federal agencies in 2013.

I could run out other examples, but I think the point is clear. The spending-slashers have created a feedback loop. We expect reasonably timely, responsive services, especially when critical needs are at stake.

We’re driven around the bend by faceless bureaucrats, like the administrative law judges who taken an average of 422 days to rule on appeals when claims for disability benefits are denied, as they often are. Others, also faceless who don’t even put veterans needing medical care on a waiting list.

Bodiless, mindless bureaucrats, like what Jesse and I used to call the metal person who put me through the drill before I could get into the queue of calls waiting  at SSA.

Whether such frustrations translate into self-defeating support for further cuts to specific agencies’ budgets isn’t altogether clear.

Michael Hiltzik at the Los Angeles Times, among others, perceives “a political motivation” in the case of SSA — specifically, that conservatives aim to make Social Security “less relevant” to everyday folks so they’ll be more willing to accept an alternative, e.g. private retirement savings accounts.

Maybe. What I’m more confident of is that unduly slow, insufficient and/or messed-up services help persuade Americans that the federal government is too damn big and ought to be retrenched.

That, of course, serves radically-right Congress members well, since they’d like nothing better than to pare off all but a few core functions, leaving the rest to state and local governments, private businesses, civil society organizations and individuals themselves.

Method in what seems the madness of forcing IRS staffing cuts that will cost the federal government at least $2 billion this year alone in taxes dodged or inadvertently not paid.


DC Coalition Calls for Some Spending Increases, But They Could Save Money … and Lives

January 29, 2015

A new mayor in the District of Columbia. New appointments to senior administrative positions. Three new Councilmembers — and two more to come.

Unexpected challenges for them all because the current fiscal year’s budget seems likely to be short about $83.3 million. It could be considerably more if the District decides to, at along last, settle its overtime dispute with the firefighters.

And there’s a bigger potential budget gap for next fiscal year — perhaps $161.3 million, according to the Chief Financial Officer’s latest estimate of the costs of District agency operations.

Into this still-fluid environment comes the Fair Budget Coalition, with its annual recommendations for (what else?) a budget and related policies that are fair to all District residents. “Fair,” as its mission statement says, means policies, including budgets, that “address poverty and human needs.”

As I’ve remarked before, FBC’s recommendations, worthy as they all may be, tend to be difficult to wrap up in a blog post because they’re a compendium of top priorities identified by working groups that focus on diverse issue areas — housing and homelessness, workforce development and income supports, etc.

So, at least for now, just a few observations.

Everything Is Connected To Everything Else

Though FBC offers diverse recommendations, they fit together, as all speakers on the panel the coalition hosted on report release day emphasized.

For example, if you’re homeless, free health care — and prescription drugs — won’t keep you from suffering life-threatening emergencies because it’s hard to follow a doctor’s recommendations when you’re out on the streets. And impossible, of course, to keep medications refrigerated, though you know some won’t be effective if you don’t.

Thus, said panelist Maria Gomez, the founder and CEO of Mary’s Center, “Health care will not help without other investments” — in the immediate case, obviously affordable housing. Perhaps other public benefits also, e.g., nutrition assistance, transportation subsidies.

A Budget Gap Doesn’t Make Spending Recommendations Moot

FBC’s recommendations seem to involve about $45.2 million in additional spending, plus some unspecified amounts, at least one of which would add to the tab. Some of the total could be offset by a pair of tax recommendations, however.

One would make the local income tax system “more progressive,” i.e., shift more of the tax burden to high-earners. The other would raise the property tax rate on “high value” homes and homes that the owners don’t live in for most of the year.

No revenue estimates for these, however — at least, not yet. More importantly, I’m inclined to doubt that the Bowser administration and the Council would revisit tax reform at this point, since the current budget adopts key recommendations that emerged from the Tax Revision Commission’s studies, debates and ultimate compromises.

This doesn’t mean that the District simply can’t afford the spending FBC recommends, budget gap notwithstanding. For one thing, the gap, large as it may seem, is only 2.3% of the projected FY 2016 budget.

For another, it’s far from certain that everything the District now spends money on is the best investment of our taxpayer dollars.

Take, for example, the Film Incentive Fund, beloved by Councilmember Vincent Orange. We’ve got research showing that the tax subsidies and other incentives used to entice TV and movie companies to film in the District don’t even pay for themselves, let alone generate additional revenues.

Nor, according to studies elsewhere, do they create steady, full-time work for residents. Not much work at all, in fact.

Just an example of where one might look for funds to, say, actually improve employment prospects for low-income residents. The modest investment FBC recommends to create career pathways for D.C. adults without basic literacy and math skills probably would.

Connections Have Budget Implications

The Mayor and Council don’t need to short worthwhile programs in order to shore up others because investing more in some yields high returns in savings and/or revenue increases. Here’s a pair of related examples — often cited.

FBC recommends an additional $12 million to expand permanent supportive housing for people with disabilities who’ve been homeless for a long time or recurrently. Studies in other communities have found that PSH not only prolongs and improves lives, but usually costs less than leaving chronically homeless people on the streets or sheltering them overnight.

Likewise, vouchers that enable homeless and at-risk families to afford market-rate housing and other vouchers that help cover the operating costs of affordable housing not only provide families with a safe, stable place to live — and thus a healthier environment and a secure platform for working or preparing for work.

These indefinite-term vouchers also cost less than a third of what the District spends, per family, on shelter at the notoriously awful DC General — or the hotels that it’s again constrained to use as shelter because there’s no room left at DCG.

No room left because the Department of Human Services can’t move enough families out fast enough to make room for all the newly-homeless families entitled to shelter. While DHS had reportedly achieved a so-called exit rate of 64 families per month, only 37 families exited the emergency shelter system during the last four weeks we’ve got (unpublished) reports on.

More locally-funded housing vouchers, especially the kind families can use in the private market as long as they have to would swiftly free up shelter space and/or keep families from needing it.

Cost-savings include not only shelter, but the collateral costs of harms associated with homelessness, especially for children. These include, but are not limited to health, behavioral and academic problems that can ultimately diminish earning power — and thus tax revenues. More immediate costs — some justified, some perhaps not — include interventions by the child welfare agency.

By these lights, FBC’s recommendation for an additional $10 million in locally-funded housing vouchers, split evenly between the first and second type, makes sense from a fiscal, as well as a moral — or if you prefer, humanitarian — perspective.

 


If You Don’t Like the Answer, Change the Question

January 12, 2015

A recent New York Times op-ed warns that the Republican leadership will instruct the (up till now) nonpartisan Congressional Budget Office to use dynamic scoring when it estimates the revenue impacts of changes to the tax code.

The House of Representatives, in fact, passed a rule last week that requires not only CBO, but the also nonpartisan Joint Committee on Taxation to use dynamic scoring for all “major legislation” — and to provide just one estimate, rather than the range they’ve customarily provided for large-scale economic effects.

We’ve had rumors of this radical change ever since Republicans seemed like to gain control of the Senate, as well as hold onto their House majority. Fueling them was the expectation, proved correct, that Congressman Paul Ryan, who’s a fan of dynamic scoring, would become head of the House tax-writing Ways and Means Committee.

And we’ve had warnings of the consequences for even longer. Because dynamic scoring has been around for quite awhile.

How CBO and JCT score legislation might seem far removed from policies that affect poor and near-poor people in America. But it isn’t because dynamically-scored tax cuts can make prospective revenues seem greater than they’ll actually be.

Congress can then more easily make tax cuts that will drive the deficit upward — and so set the stage for spending cuts (except for defense) more severe than even those we’ve seen.

Brief explanation from a non-economist who believes she’s read enough to grasp the basics.

How CBO and JCT Score Legislation

When bills with any potential revenue impact are proposed, they’re sent to CBO for a score, i.e., estimates, over a 10-year period, of how the legislative changes will increase or reduce federal revenues. JCT gets involved when the bills are tax-related.

As the op-ed author, Professor Ed Kleinbard explains, the experts try to predict how people will respond and to fold the results of those responses into the scores.

Say, for example, some Congress members want to raise the gas tax. CBO and/or JCT would factor in the likelihood that some people would drive less. Buy more fuel-efficient cars too perhaps. And so the revenue estimates wouldn’t be as high as a straightforward addition of the extra paid at the pump if drivers kept buying as much gas as they do now.

Congressman Ryan is thus pulling the wool over our eyes when he claims that the current scoring method fails to “take into consideration behavioral changes or economic effects.” Ditto the far right-wing Heritage Foundation’s tax and policy guru, who asserts that the current method is “static.”

How Dynamic Scoring Differs

Economic models that produce dynamic scores include estimated impacts on the entire economy and the revenue consequences thereof.

In the case of tax cuts for individuals, they’d factor in broad assumptions about what people would do, e.g., work more because they could keep more of what they earned (or less for the same reason), buy and/or invest more, which could ramp up production, create jobs and, therefore, boost income tax collections.

Similar sorts of assumptions for business tax cuts.

What the models don’t do, Kleinbard says, is factor in the consequences of tax cuts that don’t trigger spending cuts or tax hikes later. Nor, he adds, do they include the negative effects on economic output that would result from less government spending.

CBO actually does sometimes estimate “feedback effects” on the overall economy. But, it says, they tend to be “small relative to the direct budgetary effects.” And, as I said above, it never offers a single macroeconomic impact estimate.

Not what the Republican tax-cutters want. As Citizens for Tax Justice says, they’re looking for something like the oft-debunked Laffer curve, which has been used to argue that tax cuts pay for themselves.

Implications of the One-Estimate Rule

All the responsible experts I’ve read emphasize the iffiness of dynamic scoring. Understandably, because as Kleinbard says, the models economist use involve a lot of assumptions about who will do what if taxes rise or fall.

The Center on Budget and Policy Priorities, which has been bird-dogging the issue, points out that JCT produced eight different estimates of the dynamic effects of just-retired Congressman Dave Camp’s tax reform plan.

They ranged from $50 billion to $700 billion in additional revenues over the first 10 years — or from another perspective, a 16-fold difference between the lowest and highest estimates of the increase in the total value of goods and services produced.

And which do you suppose Camp cited? Which do you suppose Republicans tax-writers would use if presented with the options?

But under the House rule, they wouldn’t be. They’d get just one — and instead of, rather than in addition to the conventional score that’s provided the basis for revenue estimates up until now. But only when they thought it would support their plans, since they could easily evade the “major legislation” standard when it wouldn’t.

And very importantly, they wouldn’t necessarily get the explanations for dynamic scores, as they have up until now. Which means that we wouldn’t have them either.

The model that produced the estimate Camp touted assumed that Congress would prevent the deficit from soaring by cutting transfer payments, e.g., Social Security, unemployment insurance, SNAP (food stamp) benefits.

One way or the other, the dynamic scoring gambit will ultimately feed arguments for cutting social insurance, safety net benefits and/or other programs that are properly viewed as investments, e.g., in science, infrastructure, public education. Like as not, all of the above.

That, Kleinbard concludes, “is what lies inside the Trojan horse of dynamic scoring.” And it’s why we everyday citizens ought to care about what seems so arcane.


Some Good Things That Happened This Month … and Some Bad

December 22, 2014

Well, you know the big good thing, of course. We didn’t have another government shutdown. And we’ve got a budget that will defer further Republican efforts to gut domestic spending until work on next year’s budget begins. Only a brief respite, however, from efforts to block the President’s recently-announced immigration enforcement policies.

You know some of the big bad things too, I suppose. Banks will again be allowed to invest federally-insured deposits — your savings and mine — in some risky derivatives, e.g., bets on the creditworthiness of borrowers.

And very wealthy people will be allowed to donate a whole lot more to the national political parties — a far less risky investment in election results and policy decisions that serve their interest.

For us who live in the District of Columbia, the override of our vote to legalize small-scale marijuana possession and production is a big bad thing too — if not in itself, then because it’s a grating reminder that Congress can meddle in our local affairs whenever it chooses.

Other good and bad things happened this month that didn’t get as much media attention. Here are four that follow through on issues I’ve been blogging about.

Funding for the National Housing Trust Fund

The National Housing Trust Fund will, at long last, have some money for grants to support the development and preservation of affordable housing — mostly rental housing for the very lowest-income households.

Brief review of the history for those who’ve lost track.

When Congress created the Fund, in 2008, it designated a certain percent of Fannie Mae and Freddie Mac’s new business as the main revenue stream. Well, you know what happened to them when the housing market tanked at about the same time.

Despite the recovery, the Federal Housing Finance Agency, which took over their affairs, preserved its freeze on their contributions to the Fund.

We’ve had a series of legislative proposals to create another revenue stream. Nothing’s come of any of them — or of the one-time financing the President has included in his proposed budgets.

Earlier this month, FHFA told Fannie and Freddie to begin transferring money to the Fund, as the law that created it envisioned. Hardly the be-all and end-all for the acute shortage of housing that affordable for extremely low-income people, but every bit helps.

A Boost for High-Quality, Affordable Child Care

The budget package Congress just passed includes an additional $75 million for the recently updated and improved Child Care and Development Block Grant. The increase will surely help, though, as CLASP says, far more will be needed.

States will have to spend more to carry out their mandated responsibilities, as my overview of the new block grant law noted. They’ll need even more funds to reverse the downward trend in the number of children with CCDBG-subsidized child care — fewer in 2012 than in any year since 1998.

But again, every bit helps. And it’s encouraging to see continuing bipartisan support for high-quality child care that’s affordable for low-income families, as it surely isn’t without a subsidy.

Another Funding Cut for the IRS

The just-passed budget package cut funding for the Internal Revenue Services by $346 million, leaving the agency with less, in real dollars, than in any year since 2000, when it had fewer tax returns to process and fewer responsibilities as well.

This is a good thing if you’re anxious about having your tax returns audited. Not a good thing if you want an IRS representative to answer questions so you can file an accurate return.

And a very bad thing indeed if you’re worried about insufficient funding for non-defense programs, including those intended to provide both opportunities and a safety net for low-income individuals and families.

Or, for that matter, if you’re worried about the deficit. And we who care about these programs should be, since it’s been used to justify harmful spending cuts, including, but not limited to those Congress has already passed.

Because less money for the IRS means less money to offset spending. The Treasury Department estimates that every $1 spent on enforcement yields a $6 return in revenues collected. Citizens for Tax Justice cites considerably higher ROI figures.

The latest funding cut seems likely to further reduce the number of audits the IRS conducts — especially the potentially high-yielding, complex audits of high-income individuals and big businesses.

Thus, says sharp-witted economist/blogger Jared Bernstein, the budget cut is “a way to cut taxes without explicit tax cuts.” And tax cuts without offsetting revenue-raisers mean a shrinking pot of money for the already-squeezed non-defense share of the budget.

Another Victory for the White Potato

Buried deep in the budget package, we find a provision that requires the U.S. Department of Agriculture to add white potatoes to the list of foods that states must and can include in their own WIC packages, i.e., what low-income mothers of young children can buy with their WIC coupons or the equivalent.

The coupons are supposed to supplement the family’s diet with nutrients it might otherwise not get enough of. So the list includes foods like whole-grain bread, low-fat dairy products and fruits and vegetables. These reflect recommendations by experts at the Institute of Medicine.

The IOM panel did not recommend white potatoes because, in its view, mothers and their young children already ate quite enough of them. The potato industry loudly protested. And Congress members from potato-growing states swiftly launched a series of maneuvers to insert white potatoes into the WIC list.

Now they’ve succeeded — a first-time-ever successful effort to override the scientific judgment the WIC list reflects. Not, however, the first time Congressional potato champions have successfully interfered with dietary guidelines for federally-subsidized meals.

Further proof, were any needed, that bipartisan isn’t always better.

NOTE: I’m painfully conscious that I’ve left out some noteworthy good things — and some bad as well. What would you add?

 


HUD Budget Bill Shortchanges Homeless and Affordable Housing Programs

May 29, 2014

The DC Housing Authority figures it will need $1.3 billion to preserve all the public housing units it operates. It’s not expecting anything like that any time soon, as Dena Levitz at The Atlantic reports.

In fact, its share of what Congress provides for public housing development and maintenance is currently about $11 million less than in 2000. And it’s short on funds for operating costs too.

At the same time, DCHA has an affordable housing waiting list so long that it decided to close it somewhat over a year ago.

This reflects an acute shortage of federal funds not only for public housing, but for vouchers, including the kind that extremely low-income people can use to help pay market rate rents.

These shortages help explain the very high number of homeless people in the District, though they’re certainly not the only factor. We must also look to soaring housing costs and inadequate local funding for affordable housing programs.

These aren’t problems for the District alone. New York City, for example, had more than 64,000 homeless people during last year’s one-night count. There too, low-income residents face skyrocketing rents, relatively stagnant incomes, a voucher shortage and public housing in disrepair.

A nationwide study conducted four years ago estimated a $26 billion backlog in public housing capital needs. And that was before the Budget Control Act tightened the screws on federal spending — in part through sequestration.

Well, the December 2013 budget deal provided some temporary relief from sequestration. Non-defense discretionary programs, i.e., those that depend on annual appropriations, have $9.2 billion more for the upcoming fiscal year.

Yet key programs administered by the Department of Housing and Urban Development are in trouble. Homeless assistance grants and major affordable housing programs stand to lose $510 million, in inflation-adjusted dollars, under the bill the House Appropriations Committee approved last week.

The subcommittee for HUD and Transportation Department appropriations got $1.8 billion more than it had to work with last year. But this was more than offset by a projected $3 billion or so reduction in revenues from mortgages insured by the Federal Housing Administration.

The subcommittee chairman says, “Like appropriators do, we made choices.” They’ll force some very tough choices on state and local agencies — and setbacks for the homeless and other low-income people they serve.

Here are some of the specifics, summarized from a new Center on Budget and Policy Priorities brief.

Housing Choice vouchers. The 2013 across-the-board cuts forced agencies to reduce the number of households receiving rental assistance through these vouchers by an estimated 72,000 nationwide.

This year’s budget provided enough money to restore about half. But the House appropriations bill could more than undo the improvement, leaving 12,000 fewer low-income households with vouchers than before.

The problem here is partly that vouchers issued to veterans under a separate program no longer have their own funding stream and so would have to be renewed out of the overall Housing Choice budget.

That would leave agencies without sufficient funds to cover expected rent and utility cost increases for all vouchers now in use.

So they can again cut back on vouchers for non-veterans. Or they can shift the cost increases to voucher holders by freezing the value of the subsidies. One of those tough choices.

Note that we’re talking only about preserving the rental assistance Housing Choices has recently provided — not about addressing the needs of 11.3 million households that are probably paying more than half their income for rent, including at least 50,150 in the District alone.

Public housing capital investments. The House appropriations bill cuts the under-funded public housing capital fund by $100 million, leaving DCHA and other housing authorities with only half the funds they need to cover new development and renovation needs.

Public housing operations. Not enough funding for public housing operations either — about  86% of what HUD said was needed.

Agencies can cope with the shortfall in various ways, e.g., by cutting back on routine maintenance, passing on more of their utilities costs to residents, exercising their discretion to impose a $50 minimum rent on the very poorest families. More tough choices.

Homeless assistance grants. The House bill level-funds homeless assistance grants, rejecting the Obama administration’s request for additional funds to support 37,000 new units of permanent supportive housing for chronically homeless people.

It’s not clear that the $2.1 billion in the House bill would even be enough to sustain all the PSH units supported by federal funds, since it would leave at least some grant recipients with less.

What is clear is that the House bill — in this area, as well as others — dumps responsibility for a major national problem on state and local governments and on nonprofits, whose resources are already stretched thin.

HOPWA (Housing Opportunities for People with AIDS) grants. A particular special needs population would lose out under another part of the House bill. Funds that help state and local agencies provide housing for people living with HIV/AIDS would be cut by more than 8%.

That would leave this relatively small, but vital program with less than it had after sequestration — and so less able than ever to meet the needs of more than 145,000 vulnerable people who reportedly need housing assistance.

This isn’t the whole story — and happily not the end. The Senate Appropriations Committee has just decided how to parcel out funds among its subcommittees. And Transportation-HUD has about $2.4 billion more than its House counterpart had to work with.

Now let’s see what it does.

 

 

 


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