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Press Room

NAHRO Statement on Implementation Plans for the FY 2005 Housing Choice Voucher Program

Contact: Liz Hennessy, 202-289-3500 ext. 280 or lhennessy@nahro.org

On Dec. 8, President Bush signed into law the fiscal year 2005 omnibus appropriations act. The bill significantly cuts many Department of Housing and Urban Development (HUD) programs; however, funding for the Section 8 Housing Choice Voucher (HCV) program was increased by 4.5 percent. In the bill, Congress retained a budget-based method of funding voucher renewals. HUD recently released its plan for implementation of the FY 2005 funding for the HCV. In response to the announcement of this plan, Saul Ramirez, executive director of the National Association of Housing and Redevelopment Officials (NAHRO), issued the following statement:

"We welcome HUD's expeditious announcement of implementation plans for HCV renewals in 2005 and are encouraged to see that a plan has been put forth so quickly. We are also pleased about plans to increase transparency and predictability regarding the level of funding agencies will receive in 2005.

"It is reassuring that the money appropriated by Congress for FY 2005 appears to be sufficient for housing agencies to renew existing vouchers throughout 2005 and that Congress specifically directed HUD to allocate the total amount of dollars appropriated. This year, Congress also specifically directed that the renewal of HCV vouchers be undertaken using a budget-based methodology. This fixed-funding approach will not accurately account for housing markets with increasing or decreasing costs. As a result, agencies may have to make difficult decisions regarding the administration of their programs. We have questions concerning this policy and others detailed in the implementation plan, and the possible effects they will have at the local level both for housing agencies administering the Housing Choice Voucher program and the people they serve in their communities. Some of these questions include:

  • Will the annual adjustment factor for operating cost increases be sufficient?
  • How will agencies cope with curtailment of replenishing reserve accounts to only one week, which reduces their ability to react to unexpected costs?
  • Will the implementation plan help local agencies cope with local market variables such as rising energy costs?

"Answers to these questions and others that may arise upon closer inspection of HUD's implementation notice will help agencies more readily adapt to the renewal policy outlined by the department. In short, we simply cannot afford to repeat the tumultuous year of uncertainty that many local agencies and many families experienced in FY 2004.

"Finally, it appears that the primary rationale for moving to a budget-based renewal policy is that HCV program spending is spiraling out of control. We believe this issue must be seen in proper light for future decision making. Recent analysis shows that the rate of increase in spending per housing choice voucher has actually diminished in the last 2 years.

"We stand ready to work with HUD and members of Congress to find answers to our outstanding questions on the implementation policy. As we move forward, our collective goal should be to work with local agencies to help them ensure that low- and moderate-income families are not adversely impacted. Together, we must work to ensure that we continue to adequately serve the families in need of decent affordable housing."