Contact: Leslie Strauss | 202-842-8600, ext. 141 | leslie@ruralhome.org

Washington, D.C., Feb. 4, 2008 – Rural Americans would receive deplorably low levels of housing aid under the fiscal year 2009 budget released today by the Bush Administration, according to rural housing experts, and even a signature rental housing effort would be abandoned.

“There is one bright spot in the funding proposal for the U.S. Department of Agriculture’s rural housing programs,” explained Moises Loza, executive director of the Housing Assistance Council. “The budget proposes about the right amount for rental assistance to low-income tenants, almost $1 billion. But it defunds a number of essential programs, including the Administration’s own recent efforts to save rental developments for very low-income tenants.”

Rural housing programs that would receive no funding under the proposed budget are:

• Section 502 low-cost mortgages for low-income first-time homeowners;
• Section 515 loans supporting development of rental housing for very low-income tenants;
• Section 523 support for community organizations that run self-help ‘sweat equity’ homeownership programs for low-income families;
• Section 514/516 loans and grants for organizations developing housing for farmworkers;
• rental preservation efforts including USDA’s Multifamily Preservation and Revitalization Demonstration and its Preservation Revolving Loan Fund;
• Section 542 vouchers, because not all funds have been used in past years;
• USDA’s Rural Community Development Initiative and the U.S. Department of Housing and Urban Development’s Rural Housing and Economic Development program, which work in different ways to build local rural organizations’ abilities to meet their communities’ needs.

“The budget also proposes to emphasize guaranteed loans instead of direct loans, without recognizing that they are apples and oranges,” Loza stated. “The programs serve two different populations, and it’s the direct loans that assist people with the lowest incomes.

“The United States has repeatedly affirmed a commitment to provide decent, affordable housing for all Americans. But the rural housing portions of this budget have completely lost sight of that goal,” concluded Loza.

Founded in 1971, the Housing Assistance Council is a national nonprofit corporation headquartered in Washington, D.C. that helps local organizations build affordable homes in rural America by providing below-market financing, technical assistance, research, training, and information services. HAC’s programs focus on local solutions, empowerment of the poor, reduced dependency, and self-help strategies. HAC is an equal opportunity lender.

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