Congress Passes Two-Year Budget Agreement, Potential for More Affordable Housing Funds

Update: The Senate passed the budget resolution after 1:00 a.m. Friday morning, 71-28. The vote was delayed because of objections by Senator Rand Paul (R-KY) to the amount it would add to the deficit. The House passed the measure early Friday morning on a vote of 240-186. There were 73 Democrats who voted for the budget agreement and 67 Republicans who voted against it. The President signed the measure into law shortly after it passed the House. On Wednesday, February 7, the Senate reached agreement on a two-year budget deal that will raise spending caps for all federal discretionary programs. It also provides disaster relief funds, children’s health provisions and community health centers. In addition, it raises the debt ceiling. The measure must be passed by both the Senate and the House of Representatives before current federal funding runs out at midnight, Thursday, February 8. Supporters of the bipartisan agreement note that it makes a government shutdown very unlikely before the midterm elections. With the debt ceiling issue also put off until after the midterms, Congress will not be constantly fighting over short-term spending measures to keep the government open. It would allow Congress to focus on important issues that have been neglected in budget fights. This includes the chance for affordable housing supporters to push for more funding. The National Low Income Housing Coalition (NLIHC) notes that housing advocates can now focus on increasing funding for specific programs and that critical funding for disaster recovery will be available. The budget agreement lifts spending caps imposed by Congress in 2011 over the next two years. Defense appropriations will rise by $160 billion and non-defense domestic programs will rise by $128 billion. It also provides $90 billion for disaster relief and funds community health centers for the next two years. Of this, $28 billion is for HUD’s Community Development Block Grant-Disaster Recovery (CDBG-DR) program. The CDBG-DR program provides substantial funding for affordable housing repair and rebuilding in major disaster areas. The Senate budget agreement will also raise the debt ceiling so that it will not need to be addressed again until March 2019, after the midterm elections. The debt ceiling is the amount of money the U.S. government is allowed to borrow in order to pay its bills. In the past, both parties have used the need to raise the debt ceiling as leverage to pass legislation. The budget agreement is a temporary measure that expires on March 23, by which time the full appropriations for oe FY2018 will be adopted by the House and Senate. Congress will be working on the FY2018 final appropriations, and this is when housing supporters can push for more affordable housing funds. The Administration will also be releasing its FY2019 budget proposal in February, so housing supporters will be able to push for next year’s funding needs as well. Although no provisions related to the Deferred Action for Childhood Arrivals (DACA) program were included in the agreement, Democrats received a pledge from Republican Senate leadership to have full debate on immigration legislation before March 23. The DACA program provides protection for over 700,000 undocumented immigrants who were brought to the U.S. as children, also called Dreamers. What comes next? The Senate will take up the House spending resolution and replace its language with its own. The measure is expected to pass the Senate with strong bipartisan support. The House must then consider and pass the legislation, with the President signing it into law. President Trump indicated his support for the Senate budget agreement on Wednesday. The budget agreement could still falter. Fiscally conservative House Republicans will likely oppose it because of its impact on the deficit, especially after passing tax cuts that will increase the deficit by $1.5 trillion. Many House Democrats are upset that no provisions to protect the Dreamers were included. As of Thursday afternoon, Congressional leaders feel that there are enough Republican and Democratic supporters to pass it before the midnight deadline.