Outrageous Budget Cuts Will Cost More Than Save


Washington D.C. – February 14, 2011 -- The House appropriations committee’s proposed budget for FY 2011 will cost cities and states billions in lost jobs and tax revenues and prevent significant savings on what government spends on utilities. And coming in the middle of the budget year, it could force housing authorities to cancel contracts with local businesses and significantly reduce their ability to provide affordable housing.

“We have to look at the very real costs these cuts will impose not only on public housing residents, but on their communities,” said Sunia Zaterman, Executive Director, Council of Large Public Housing Authorities (CLPHA). “Less money means layoffs and less housing. This will put a tremendous burden on communities across the nation.”

In addition to serving 2.2 million of the nation’s most vulnerable – including seniors, people with disabilities, and homeless veterans – public housing spending is a smart investment. The bill also defunds additional vouchers for Veteran Affairs Supportive Housing (VASH) program despite the recent HUD and VA report  that found nearly 76,000 veterans were homeless on a given night in 2009.

A 2007 economic analysis found that every dollar a housing authority spends generates $2.12 in local economic activity.  An updated study tracking the impact of Recovery Act funds being released next month will demonstrate that one dollar of PHA spending generates $3.12 in national economic activity.

The bill proposes cutting the already-inadequate capital fund in half, from the $2.5 billion current funding level to $1.4 billion. With the budget year half way over, this could decimate plans to keep thousands of affordable housing units open for business, provide jobs, reduce energy costs and strengthen communities. 

 “This money goes to the heart of public housing.” Ms. Zaterman said. “These funds buy new boilers and repair roofs. They are used to make apartments accessible to seniors and people with disabilities, and safe for everyone.”