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Press Room

President Retreats from Commitment to Affordable Housing and Community Development

Contact: Liz Hennessy, 202-289-3500 ext. 280

WASHINGTON, Feb. 9 - The following is a statement of Saul N. Ramirez Jr., executive director of the National Association of Housing and Redevelopment Officials on the president's budget proposal for fiscal year 2006:

The president's proposed budget for fiscal year 2006, which would cut the Department of Housing and Urban Development's budget by nearly 12 percent, represents an alarming retreat from the federal government's partnership with local governments to strengthen America's communities and improve the quality of life for low- and moderate-income Americans. The administration's budget proposal eliminates the Community Development Block Grant program and severely reduces funding for public housing, while retaining funding and other incentives to make homeownership more accessible and provide assistance for the homeless. We acknowledge the importance of these goals, but they alone do not constitute a responsible, comprehensive federal agenda to ensure the future viability of our communities.

The administration's proposal to eliminate the Community Development Block Grant (CDBG) program, the 30-year-old bedrock of community redevelopment that has enjoyed broad bipartisan support, is an unsettling sign of this shrinking commitment to working with local governments. CDBG is the cornerstone of the federal government's partnership with state and local governments and provides funding to rehabilitate affordable housing, spur economic growth and revitalize stagnant neighborhoods. The administration's characterization of CDBG as an ineffective program is a misguided assertion that clearly does not take into consideration the benefits CDBG has brought to communities across the nation. In the last year alone, CDBG has created or retained more than 90,000 jobs, assisted 178,000 households, and provided public services, including employment training, child care, and services for the elderly and disabled, to 13.3 million people.

The administration's diminishing commitment to partnering with state and local governments is also reflected in its shrinking investment in maintaining public housing. The president's budget cuts funding for basic public housing operations below this year's level-in which housing agencies will receive only 89 cents for every dollar necessary to provide safe, decent housing to more than 1.1 million families, elderly and disabled people. This disinvestment in a public asset worth $90 billion does not reflect wise stewardship of our nation's investment in affordable housing.

The administration has also asserted that Section 8, and in particular tenant-based housing vouchers, is consuming funding for other HUD programs. However, total reductions in the HUD budget this year are more than 9 times the increase for Section 8 housing voucher assistance.

The reduction in HUD's public housing budget and the elimination of CDBG will clearly undermine investment in our nation's local communities. No one is more committed to ensuring the effective use of federal dollars to help provide social services, affordable housing and economic development than the local governments who work on the front line in our communities. The federal government has an important role to play as an investor in this partnership. Our nation's communities need a committed federal partner to ensure their future viability.