OMB Urges Senate To Downsize Its MTW Goal


Office of Management and Budget Director Shaun Donovan wrote a letter to Sen. Thad Cochran, Chair of the Senate Appropriations Committee, in which he raised the Administration's concerns about the Senate’s use of sequestration funding levels in the THUD appropriations legislation approved by Cochran’s committee in June.

The letter was essentially another shot across the bow from the Democratic Administration to the Republican-controlled Congress that President Obama won't agree to the congressionally proposed funding levels that use the reduced amounts of the Budget Control Act of 2011. It foreshadows a clash likely to grow ever noisier as the current fiscal year draws to its September 30 close and the White House and Congress struggle to reach a spending agreement for the next fiscal year or risk another federal government shutdown. 

"Sequestration was never intended to take effect: rather, it was supposed to threaten such drastic cuts to both defense and non-defense funding that policymakers would be motivated to come to the table and reduce the deficit through smart, balanced reforms," Donovan wrote. "The Republicans' 2016 budget framework would bring base discretionary funding for both non-defense and defense to the lowest levels in a decade, adjusted for inflation... The President has been clear that he is not willing to lock in sequestration going forward..."  

Donovan went into specifics about the Administration's view of how sequestration-based spending would negatively impact domestic programs. In one section of his letter Donovan, a former HUD Secretary, singled out the Administration's disagreement with the Senate on MTW policy.

"The Committee bill includes language that would require HUD to extend the contracts of the current Moving To Work (MTWs) agencies, effectively preventing HUD from amending any significant conditions, including terms that would increase accountability and maximize the number of low-income families served."

Furthermore, Donovan said the administration is concerned about the significant expansion of the MTW program the Senate proposed, to 300 PHAs from the existing 39. The Administration had called for a much more modest expansion of only 15 high-capacity PHAs.

Donovan wrote: “The Administration strongly urges the Congress to protect HUD's authority to serve more low-income families, and address the funding disparities caused by the current MTW funding formula, which would benefit the vast majority of PHAs. Further, the Administration urges the Congress to responsibly and incrementally expand the MTW program to ensure appropriate protections for tenants and to address the criticisms historically cited by HUD's Office of Inspector General and the Government Accountability Office.”

CLPHA notes that when Donovan was HUD Secretary, the Obama Administration proposed an expansion of more than 500,000 units, not including the largest housing authorities -- New York City, Puerto Rico and Los Angeles -- an expansion that likely would have been significantly larger than what Senate appropriators propose.

Return to: CLPHA Report -July 14, 2015