11/14/2018

Housing: Post-Election Players and Issues

The November 6 elections brought some big changes for members of Congress with jurisdiction over housing policy and appropriations issues, as well as a fresh outlook on what Congress could accomplish in the lame duck session and in next year’s new Congressional session.

Lame Duck Session

Congress returns the week of November 12 with only 12 legislative days to tackle unfinished appropriations bills, among other priorities. The HUD fiscal year 2019 (FY19) appropriations bill is one that has yet to be enacted. The 2019 fiscal year began October 1; federal programs with unfinished FY19 appropriations bills are now under a Continuing Resolution (CR) that funds them at FY18 levels through December 7.  Reports from Hill staff indicate that differences between the House and Senate HUD bills had been fully negotiated and the bill was ready for enactment. Unfortunately, enactment did not occur before October 1 (the HUD bill had been included in a larger spending package – issues besides housing proved to be sticking points).

The lame duck session is another opportunity to secure a final FY19 HUD bill. While HUD staff have assured us that programs funded at FY18 levels are at no risk of underfunding through February 2019, multiple CRs can cause funding delays that can wreak havoc on affordable housing communities. LeadingAge is urging Congress to enact the FY19 HUD bill as quickly as possible during the lame duck session.

There is a strong chance that issues outside of housing will once again thwart enactment of the FY19 HUD bill: namely, whether and at what level to fund a border wall. This hurdle could indeed lead to a government shutdown after the December 7 CR expires. As it is required to do, HUD is going through its shutdown protocols in order to be as ready as possible if a shutdown should occur. It is also possible that Congress will decide to enact the spending bills that have been fully negotiated, like the HUD bill, during the lame duck session and push unfinished bills into the new Congressional session with another CR.

New Congress Committee Leadership

The post-election headline is that Democrats took majority control in the House and Republicans slightly boosted their majority in the Senate. As of this writing, 13 House races and two Senate races are unsettled.

Committee leaderships will certainly shift in both the House and Senate. In the coming weeks, Democrats and Republicans will meet and strategize how to divvy up committee and leadership assignments.

In appropriations, Representative Nita Lowey (D-NY) is expected to be the Chair of the House Appropriations Committee, and Representative David Price (D-NC) is expected to be the Chair of the HUD Appropriations Subcommittee. Mr. Price spoke forcefully for expanded Section 202 funding at LeadingAge’s SAVE HUD 202 rally on Capitol Hill in June 2017. It’s less clear who would be the Ranking Republican on House Appropriations: Representative Kay Granger (R-TX) and Robert Aderholt (R-AL) are possibilities. On the Senate side, Senators Richard Shelby (R-AL) and Patrick Leahy (I-VT) are expected to continue to be Chair and Ranking Member, respectively, of the Senate Appropriations Committee.

On the House Financial Services Committee, Representative Maxine Waters (D-CA) will get the Chair’s gavel. Current Ranking Member Waters has been strong on affordable housing issues, opposing this year’s rent reform and budget cut proposals from the Trump Administration. Ranking Member Waters energized the crowd when she spoke at LeadingAge’s SAVE HUD 202 rally in 2017. The Ranking Member on Financial Services might be Representative Blaine Luetekemeyer (R-MO) who was a great friend to housing during his time chairing that subcommittee during the last session of Congress, or perhaps Representative Patrick McHenry (R-NC). On the Senate Banking, Housing, and Urban Affairs Committee, it could that be Senator Michael Crapo (R-ID) retains his chairmanship. But, if Senator Crapo decides to chair another committee , the new Banking Chair may be Senator Patrick Toomey (R-PA).

The tax writing committees are also of great interest to housing members. With high hopes for securing expansion of states’ Low Income Housing Tax Credit allocations and improvements to the LIHTC program, these committees are key. The House Ways and Means Committee is expected to have Representative Richard Neal (D-MA) as its Chair. Current Ranking Member Neal is a sponsor of the current LIHTC improvement bill in the House. On the Senate side, the Senate Finance Committee could see Senator Chuck Grassley (R-IA) take over as Chair. If Senator Grassley instead decides to Chair the Senate Judiciary Committee, Senator Michael Crapo could be the next Senate Finance Committee Chair. Senator Ron Wyden (D-OR) is expected to continue to be Ranking Member of Senate Finance.

New Congress Issues

Completing any unfinished FY19 appropriations bills will be at the top of the new Congress’s to-do list. Some have said that Democrat leadership would like to start the 116th Congress without having to finish the previous Congress’s old business. Assuming the FY19 bills get done during lame duck, following are some of the issues of particular interest to affordable housing members that are oft-mentioned for action (or at least heavy consideration) during the new Congress.

The federal spending caps, which were imposed by the 2011 Budget Control Act, for FY20 must be increased. Except for FY13 (when the caps were not increased and housing programs were harmed), Congress has come up with two-year deals on the spending caps. Compared to the post-deal caps for FY19 non-defense discretionary spending, the current FY20 caps $55 billion less. This means that if Congress does not increase the spending caps, it must cut $55 billion from non-defense discretionary spending in order to avoid automatic funding sequestration. In sum, non-defense budget authority falls from $597 billion in FY19 to $542 billion in FY20 unless the FY20 caps are raised by Congress. The FY20 cap is insufficient to produced spending bills that could garner sufficient votes for passage.

Congress may take up an infrastructure package. As was discussed in 2018, members on both sides of the aisle would like to see Congress enact an infrastructure package to invest federal spending in much-needed local projects. LeadingAge strongly believes that affordable housing is infrastructure and will continue to urge Congress to include resources for affordable housing in any infrastructure package.

Other issues that could come up beyond domestic spending and infrastructure: overhaul of the housing Government Sponsored Enterprises (Fannie Mae and Freddie Mac), who will be the new director of the Federal Housing Finance Agency (this person will determine whether funding the National Housing Trust Fund continues from Fannie and Freddie), and a long list of housing reforms, expansion, and oversight long-sought by current Ranking Member Waters as she takes on the Chairmanship of House Financial Services. The GSE overhaul conversation intersects closely with LeadingAge’s work because, at its core, the discussion is about the role, reach and scope of the federal government in affordable housing policy and resources. LeadingAge will also be pushing our 2019 affordable housing policy platform to expand, preserve, and bring service supports into affordable housing for older adults. This platform is currently under development

Fiscal Year 2020 Request from Trump Administration

The White House’s Office of Management and Budget (OMB) is currently in discussion with HUD to determine what it’s ask for FY20 will be for HUD appropriations. Right now, OMB expects to release this request to Congress on February 4, 2019. With regard to how the Trump Administration’s FY19 request was received by Congress, one would easily say, “not favorably.” The White House’s FY19 requests to deeply cut HUD funding and impose harmful rent reforms were not taken up in Congress. (LeadingAge)