FY12 RD Budget and Appropriations

(Information on HUD budget is available separately; click here.)

FOR FINAL FY12 USDA FUNDING, click here

SENATE REJECTS AMENDMENT TO FURTHER REDUCE RD FUNDING

11:00 a.m. Eastern, November 1, 2011 - By a lopsided 85-13 vote, the Senate has defeated an amendment offered by Sen. Tom Coburn (R-Oklahoma) that would have cut USDA RD program funding for FY12 by 40 percent. A vote on H.R. 2112, the "minibus" appropriations bill covering USDA as well as Commerce/Justice, and Transportation/HUD, is expected shortly. C-SPAN's live broadcast is available here

AMENDMENT WOULD SLASH RURAL DEVELOPMENT FUNDING

October 26, 2011 - The National Rural Housing Coalition has organized a sign on letter opposing the Coburn Amendment, which may come up in the Senate next week and would cut USDA Rural Development funds for 2012 by $1 billion.  This cut would amount to 40% of RD programs and would be across all the agency's functions.  The Coalition's letter has more information and is at the following link:  http://org2.democracyinaction.org/o/5172/p/dia/action/public/?action_KEY=8587. The sign on deadline is Friday, October 28.

ADMINISTRATION ASKS SENATE TO CUT RURAL HOUSING SPENDING

On October 17, 2011, the Obama Administration issued a Statement of Policy (SOP) setting forth its position on the FY12 appropriations bill covering USDA, HUD, and other agencies that is currently under consideration in the Senate. While the SOP generally supports funding for housing programs - and even requests increases in some, including CDBG and HOME - it singles out the USDA rural housing programs for cuts:

Program Terminations and Reductions. The Administration urges the Senate to accept additional savings from terminations and reductions proposed in the President's Budget for USDA, including termination of Rural Housing Services small loan and grant programs and reductions in single family housing direct loans and housing repair grants. Adopting these terminations and reductions will free up scarce resources for higher-priority needs and more effective programs such as food safety.

The President's budget, summarized below, proposed elimination of Section 504 repair loans, Section 523 self-help grants, Section 533 Housing Preservation Grants, Section 538 rental housing guarantees, the Multifamily Preservation and Revitalization program, and the Preservation Revolving Loan Fund. It suggested major reductions in funding for Section 502 direct loans and Section 504 repair grants.  

There was no immediate response to the SOP from Senators; such statements usually do not have an impact on legislation that has already been approved by a committee, as this bill has. The Senate is expected to begin consideration of the bill - H.R. 2112, a "minibus" that combines the appropriations bills for USDA, HUD, and Commerce/Justice - on October 18 and to vote by the end of the week.

SENATE COMMITTEE APPROVES HIGHER FY12 USDA SPENDING LEVELS THAN THE HOUSE

On September 7, 2011, the full Senate Appropriations Committee marked up a bill to fund USDA in FY12. Almost every program would receive more funding than provided in the House bill passed in June, but less than the final FY11 appropriated amounts. The Section 502 guarantee and Section 538 guarantee programs are notable exceptions: both would be funded at their FY11 levels because USDA expects to collect fees that would make them self-supporting.

The Senate bill includes victories for self-help housing and rental preservation. The House bill cuts self-help to $22 million from $37 million in FY11, while the Senate provides $30 million. The House bill eliminates funding for Multifamily Preservation and Revitalization (MPR) but the Senate includes it at $2 million, a sharp drop from the FY11 level of $15 million for this very popular demonstration program.

Observers do not expect most appropriations bills, including this one, to be finished before FY12 begins on October 1, 2011. A continuing resolution is expected to keep programs at FY11 levels, at least temporarily.

USDA Rural Development Program
(dollars in millions)

FY10 Approp.

FY11
Approp. (a)

FY12 Admin. Budget

FY12
Hse. Bill (H.R. 2112) (e)

FY12
Sen. Bill
(H.R. 2112) 

Loans and Payments

 

 

 

 

 

502 Single Fam. Direct

$1,121

$1,121

$211.4

$845.6

 $900

502 Single Family Guar.

12,000

24,000

24,000

24,000

 24,000

504 Very Low-inc. Rpr.

34.4

23.4

0

0

 10

514 Farm Labor Hsg.

27.3

(b)

27

(d)

 23.4

515 Rental Hsg. Direct

69.5

69.5

95.2

58.6

 64.5

538 Rental Hsg. Guar.

129.1

30.9

0

0

 130

Rental Prsrv. Revlg. Lns.

1.8

1

0

0

 0

Grants

 

 

 

 

 

504 Very Low-inc. Rpr.

31.6

(c)

11.5

32

 27

516 Farm Labor Hsg.

9.9

(b)

9.8

(d)

 8

523 Self-Help TA

41.9

37

0

22

 30

533 Hsg. Prsrv. Grants

9.4

(c)

0

0

 7.3

521 Rental Assistance
    Preservation RA
    New Constr. 515 RA
    New Constr. 514/516 RA

980
(6)
(2.03)
(3.4)

955.6
0
(2.03)
(3)

906.7
0
(3)
(3)

890
0
(1.5)
(2.5)

 904.7
0
(2)
(2)

542 Rural Hsg. Vouchers

16.4

14

16

11

11 

Rental Prsrv. Demo. (MPR)

25

15

0

0

 2

Rural Cmnty. Dev’t Init.

6.3

5

8.4

3

 4.2

 a. Figures shown do not include 0.2% across the board reduction.
b. Budget authority (BA, the cost to the government) in the farm labor housing account would remain at FY10 levels, but loan costs have risen as interest rates have risen, so the 514/516 program levels could be somewhat lower.
c. The Rural Housing Assistance Grants pool, which funds Section 504 grants, Section 533, and some other smaller programs, is reduced by $1 million from FY10 levels.
d. The BA for Section 514 and 516 would fall from $9.7 million in FY11 to $2.5 million for FY12, but the House bill does not allocate amounts specifically for loans or grants.
e. Figures shown do not include 0.78% across the board reduction.

HOUSE PASSES USDA FY12 SPENDING BILL, REJECTS AMENDMENTS 

June 16, 2011 - The full House of Representatives today passed H.R. 2112, a bill to fund the U.S. Department of Agriculture for FY12, with a small across-the-board cut to all programs but without adopting amendments that would have affected funding for USDA's rural housing programs. 

Aside from the 0.78 percent across-the-board cut, the rural housing funding levels are unchanged from those adopted by the House Agriculture Appropriations Subcommittee on May 24 and the full House Appropriations Committee on May 31. The bill would provide more rural housing funding than had been feared, although all programs except Section 502 guarantees and Section 504 grants would be cut.

Amendments to eliminate funding for Section 523 self-help housing were offered and defeated at both the Subcommittee and Committee sessions. Two housing-related amendments were proposed and defeated on the House floor. One would have reduced funding for the Section 504 grant program to $11.5 million, the level proposed by the Administration's budget. The other would have cut money from the Foreign Agricultural Service and moved it to Section 542 vouchers (where it is not needed) and a USDA business program.

The Senate is likely to propose higher housing figures when it begins consideration of USDA appropriations later this summer.

The full text of H.R. 2112 will be available at http://thomas.loc.gov/home/approp/app12.html.

USDA Rural Development Program
(dollars in millions)

FY10 Approp.

FY11
Approp. (a)

FY12 Admin. Budget

FY12 Hse. Bill (H.R. 2112) (e)

Loans and Payments

502 Single Fam. Direct

$1,121

$1,121

$211.4

$845.6

502 Single Family Guar.

12,000

24,000

24,000

24,000

504 Very Low-inc. Rpr.

34.4

23.4

0

0

514 Farm Labor Hsg.

27.3

(b)

27

(d)

515 Rental Hsg. Direct

69.5

69.5

95.2

58.6

538 Rental Hsg. Guar.

129.1

30.9

0

0

Rental Prsrv. Revlg. Lns.

1.8

1

0

0

Grants

504 Very Low-inc. Rpr.

31.6

(c)

11.5

32

516 Farm Labor Hsg.

9.9

(b)

9.8

(d)

523 Self-Help TA

41.9

37

0

22

533 Hsg. Prsrv. Grants

9.4

(c)

0

0

521 Rental Assistance
    Preservation RA
    New Constr. 515 RA
    New Constr. 514/516 RA

980
(6)
(2.03)
(3.4)

955.6
0
(2.03)
(3)

906.7
0
(3)
(3)

890
0
(1.5)
(2.5)

542 Rural Hsg. Vouchers

16.4

14

16

11

Rental Prsrv. Demo. (MPR)

25

15

0

0

Rural Cmnty. Dev’t Init.

6.3

5

8.4

3

a. Figures shown do not include 0.2% across the board reduction.
b. Budget authority (BA, the cost to the government) in the farm labor housing account would remain at FY10 levels, but loan costs have risen as interest rates have risen, so the 514/516 program levels could be somewhat lower.
c. The Rural Housing Assistance Grants pool, which funds Section 504 grants, Section 533, and some other smaller programs, is reduced by $1.1 million from FY10 levels.
d. The BA for Section 514 and 516 would fall from $19.7 million in FY11 to $12.5 million for FY12, but the bill does not allocate amounts specifically for loans or grants.
e. Figures shown do not include 0.78% across the board reduction.

 

Administration Budget for FY 2012 Would Slash 502 Direct, Self-Help, and Multifamily Preservation

February 14, 2011 - The Obama Administration's budget for fiscal year 2012 proposes to maintain several USDA rural housing programs at their FY10 levels, but would cut Section 502 loans dramatically and would eliminate several important programs.

Information about the budget for HUD programs
Discuss or comment on the budget on HAC's rural housing listserv

Under the Administration's proposal, Section 502 direct loans would drop to $211.4 million from their FY10 level of $1.121 billion. The Section 502 guaranteed loan program would remain at $24 billion. Section 523 grants for local self-help housing producers would be eliminated. To explain the Section 523 cut, the budget documents state that single-family housing efforts would be focused on the Section 502 guaranteed program.

Section 538 guarantees for multifamily housing would be eliminated, and Section 515 loans would be receive an increase from $69.5 million in FY10 to $95.2 million in FY12. The Section 515 program would need to cover multifamily preservation efforts as well as new construction, however, because the Multifamily Preservation and Revitalization demonstration program would be defunded, as would the Preservation Revolving Loan Fund.

The budget does recommend almost level funding at $16 million for rural housing vouchers for tenants living in properties whose mortgages are prepaid. Like previous appropriations bills, it would limit vouchers to tenants of Section 515 properties, omitting those who live in Section 514/516 farm labor housing developments.

Farm labor housing loans and grants would receive the same funding as in FY10. Section 504 very low-income repair loans would be eliminated but grants would be funded, albeit at a much lower level than in FY10. All Rental Assistance contracts would be renewed for one year, and RA for new construction would be available for both Section 515 and Section 514/516 properties.

The table below shows not only the FY12 budget proposal, but also the funding levels proposed for the remainder of FY11 in H.R. 1, introduced on February 11 by House Appropriations Committee Chairman Harold Rogers (R-KY). H.R. 1 would maintain many USDA rural housing programs at their current levels, but would shrink Section 515 and eliminate funding for rental housing preservation.

Under the current continuing resolution, which expires March 4, USDA rural housing programs are funded at their FY10 levels. Congress will consider funding for the rest of FY11 (from March 4 through the end of the federal fiscal year on September 30, 2011) before it begins work on appropriations bills for FY12.

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USDA Rural Development Program
(dollars in millions)

FY 2010 Approp.

FY 2011 Admin. Budget

FY 2011 Proposed CR
(H.R. 1)

FY 2012 Admin. Budget

Loans

 

 

 

 

502 Single Fam. Direct

$1,121

$1,200

$1,121

$211.4

502 Single Family Guar.

12,000

12,000

12,000

24,000

504 Very Low-inc. Rpr.

34.4

34

34

0

514 Farm Labor Hsg.

27.3

27

27.3

27

515 Rental Hsg. Direct

69.5

95.2

69.5

95.2

538 Rental Hsg. Guar.

129.1

129.1

129.1

129.1

0

Rental Prsrv. Revlg. Lns.

1.8

0

0

0

Grants and Payments

504 Very Low-inc. Rpr.

31.6

31

31.6

11.5

516 Farm Labor Hsg.

9.9

10

9.9

9.8

523 Self-Help TA

41.9

37

37

0

533 Hsg. Prsrv. Grants

9.4

9.4

9.4

0

521 Rental Assistance

980

966

955.6

906.7

Preservation RA

(6)

0

0

0

New Constr. 515 RA

(2.03)

(3)

(2.03)

(3)

New Constr. 514/516 RA

(3.4)

(3)

(3)

(3)

542 Rural Hsg. Vouchers

16.4

18

16.4

16

Rental Prsrv. Demo. (MPR)

25

0

0

0

Rural Cmnty. Dev’t Init.

6.3

0

0

8.4

 

Posted: February 14, 2011
Last updated: October 18, 2011

 

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