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HUD FORCED TO BACKTRACK ON FUNDING NOTICE

The threat of reduced housing services for low-income families, the elderly and disabled still remains with the release of HUD's second and latest "clarification" of FY03 funding levels. In response to intense media coverage of a drastic 30 percent funding cut, HUD now states it intends to cut public housing funding by 10 percent rather than 30 percent as indicated in their Jan. 6 notice to housing authorities.

Despite HUD's assertions in the second notice, more than half of the 3,200 housing authorities in the country still will only have 70 percent or less of their funding available to operate for most of their fiscal year. HUD acknowledges that any adjustment to the 70 percent funding level will not take place before this summer. This forces housing authorities to implement cuts in services and to serve fewer low-income families immediately.

HUD refuses to seek $250 million in emergency supplemental funding necessary to cover the FY02 shortfall caused by its own miscalculations in full funding for FY03. Furthermore, HUD concedes that their FY03 appropriations request will not provide adequate funds to operate well-managed, safe and decent housing. The question remains how deep the cut ultimately will be given HUD's own admission of mismanagement and inability to predict funding needs.

These cuts are compounded by HUD's ending the Public Housing Drug Elimination Program as well as reductions in the Capital Fund and Section 8 Voucher program.

We call on Congress to provide $250 million in emergency supplemental funding necessary to cover FY02 shortfall and full funding for FY03 for housing that serves our most vulnerable families, seniors and disabled persons.