ARTICLE: What does the “debt deal” mean for homelessness?

By on August 3, 2011. Posted in . Tagged as , , , .

This article comes from the National Alliance to End Homelessness, an organization that Helping Hand House has worked alongside in implementation of national-level strategies here in Pierce County. More at

What does the “debt deal” mean for homelessness?

Today’s guest post was written by Alliance Vice President for Programs and Policy Steve Berg.

Many of us – especially people outside the beltway – are asking ourselves, “What just happened?”

People who follow what goes on in Washington, D.C. have been watching an ugly debate over federal spending, taxation, and borrowing. On the news, it’s been commonly referred to as the “debt ceiling” debate. For now, that debate is over, to be resumed at a later date.

There are plenty of people commenting on who got the better of whom; today I’ll try to cover what the “debt deal” could mean for homelessness.

First, a quick summary of the debt deal. It cuts federal spending in two ways:

First, it sets maximum levels for discretionary spending (spending that is set each year through the appropriations process, including virtually all targeted spending for homelessness programs) for the next 10 years. The impact of the debt deal comes mostly in the later years. For the 2012 fiscal year that begins in October 2011, discretionary spending is set at $1.042 trillion, $7 billion less than FY 2011 funding levels and $98 billion less than the Obama Administration’s budget request for FY 2012.
Second, the debt deal cuts spending through additional across-the-board reductions to most domestic and defense programs, this time including not only discretionary spending but also some entitlements like Medicare. These will begin in 2013, with the total cuts over ten years to be $1.2 trillion. Some programs for low-income people (Medicaid, for example) would be exempt from the automatic cuts, but others, like Section 8, would not be exempt, which could mean that thousands of families lose their housing. Instead of allowing these cuts, Congress can pass a bill proposed by a “super-committee,” reducing federal debt by at least $1.2 trillion through some combination of spending cuts and revenue increases. But the super-committee has to do that by the end of the 2011 calendar year.

So how will this affect homelessness? No decisions have been made on the details, but there are two ways this deal could have an impact.

First is the impact of the maximum levels set for discretionary funding. This could impact funding for targeted homelessness programs, especially the Emergency Shelter Grants and Continuum of Care run by the Department of Housing and Urban Development (HUD). In his original budget, the President proposed an increase of $471 million for HUD’s homeless assistance for 2012 to implement the HEARTH Act, finance 10,000 new HUD-VASH vouchers, and create 7,500 targeted rent vouchers for the Housing and Services for Homeless Persons demonstration. In light of the high rate of joblessness and the struggling economy, all those new resources are desperately needed for homeless and at-risk people. But now we know that overall discretionary spending for FY 2012 will be nearly $100 billion less than what the President’s budget proposed which could jeopardize the creation of these new resources.

Secondly, the work of the “super-committee,” carried out under intense time pressure, creates many dangers in the long run. While entitlement programs for low-income people are exempt from the automatic cuts that take place if the super-committee does nothing, they are not exempt from a super-committee proposal. Roll-backs in Medicaid or TANF, for example, may be tempting for the members of the “super-committee” when they’re overwhelmed with the task of finding cuts to the federal budget. But we know that such cuts would be devastating for people who are homeless or at risk of homelessness and rely on federal programs.

In this context, protecting federal homelessness programs will require a lot of work. And the work will only get harder in succeeding years.

Fortunately, the effectiveness of these programs, the vulnerability of homeless people, and the bipartisan history of the work provide a strong case, but the case has to be made. Increased funding remains eminently doable, but only if people in Congress know that it is important back home.

That’s where you come in. The Alliance’s grassroots efforts have always proved effective. The Alliance works to connect passionate citizens with their Members of Congress so that lawmakers can hear, first-hand, the needs and concerns of their constituents. This is the most effective way that we, as everyday people, can best affect policy change.

To find out what you can do to protect homeless assistance programs, please contact us. You can learn more by visiting our website.

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