Researchers predict consequences of debt limit stand-off
While congressional leaders and President Biden work to agree on provisions for raising the U.S. debt limit before the country’s borrowing reaches it in early June, economists and others are attempting to predict possible consequences of various scenarios.
- If the House-passed Limit, Save, Grow Act becomes law, the Center on Budget and Policy Priorities estimates, it would require a 33% cut in “the two-fifths of the discretionary budget outside of defense and veterans’ medical care.” As a result, over 2 million people would lose rental assistance and 119,000 people experiencing homelessness would not receive aid. Because the spending reductions would increase over time, the cut would grow to 59% in 2033. CBPP provides an interactive graphic showing how protecting some programs changes the level of cuts to others.
- If there is no agreement before the debt limit is reached, a short-term default of less than a week would lead to a “mild” recession in the second half of 2023, according to Moody’s Analytics. Real GDP would decline by 0.7 percentage point, employment would fall by 1.5 million jobs, and the unemployment rate would rise from 3.4% to a peak of almost 5%. There would be little long-term fallout on the economy, although global investors would demand higher interest on Treasury debt to compensate for the risk of future debt limit breaches, creating a significant cost to taxpayers in the long run.
- If the debt limit breach lasts for a month or longer, Moody’s predicts a “cataclysmic” blow to the economy. The federal government would have to slash its spending, leading to an economic downturn comparable to that in 2007-2008. More than 7.8 million jobs would be lost, and unemployment would rise to 8%. The effects would still be felt a decade in the future. In both the short and long term, healthcare providers would likely become more hesitant to see Medicare and Medicaid patients. Confidence in other government supports would weaken spending and confidence, especially in areas with more lower-income or elderly households.
House subcommittee approves FY24 USDA spending bill
The House has begun working on appropriations bills for fiscal year 2024, which begins on October 1, 2023. The Agriculture Appropriations Subcommittee passed a bill on May 18 that would fund many rural housing programs at levels lower than those requested in the administration’s budget, and in some cases lower than the amounts appropriated for FY23 or FY22. HAC has posted details on its website. The bill will move next to the full House Appropriations Committee, which has postponed a markup originally set for May 24.
According to the 2020 Census, there are approximately 697,000 rural Asians and Pacific Islanders in the United States. Source: Housing Assistance Council Tabulations of the U.S. Census Bureau’s 2020 Census of Population and Housing. For more information on race and ethnicity in rural America visit HAC’s website.
USDA offers Native CDFIs funds to relend
Certified Native CDFIs can apply to USDA for loans from the Native Community Development Financial Institution Relending Demonstration Program. Awardees will relend money to low- and very low-income households to acquire, build, rehabilitate, improve, or relocate dwellings on Tribal land in rural areas. The deadline is July 17. For more information, contact Brian Hudson, USDA, 608-697-7725.
Powering Affordable Clean Energy Program to finance renewable energy
The Rural Utilities Service is launching the Powering Affordable Clean Energy (PACE) Program, appropriated $1 billion in the Inflation Reduction Act to serve places with populations of 20,000 or less, or service areas of current RUS Borrowers or former RUS and Rural Electrification Act borrowers. The program will provide loans for projects that generate and/or store electricity from renewable energy resource systems. Nonprofits, for-profits, state and local governments, Tribes, institutions of higher education, community-based organizations, distribution electric cooperatives, and generation and transmission electric cooperatives are eligible and may submit letters of interest between June 30 and September 29. Loans are potentially partially forgivable, with the forgivable portion varying depending on the geography served. For more information, contact Christopher A. McLean, USDA, 202-690-4492.
REGULATIONS AND FEDERAL AGENCIES
USDA proposes to waive Buy America requirements for some community facilities and water and environmental projects
USDA has requested a one-year exemption from Build America, Buy America procurement requirements for infrastructure projects funded by USDA’s water and environmental or community facilities programs that were planned prior to May 14, 2022. The waiver would apply to projects that were awarded funds before that date, submitted an application to USDA, or held “substantial public engagement” such as having public meetings or publishing a notice related to project selection. Comments on the waiver request are due June 2. For more information or to submit comments, email firstname.lastname@example.org with the subject “RD Waivers: Public Interest Waiver for Projects Planned Prior to BABAA Implementation.”
FEMA seeks comments on risk assessment data
FEMA requests public input as it implements new statutory requirements that include designating “community disaster resilience zones” for targeting disaster mitigation efforts. Its questions address methodology and data, the designation process, and the types of assistance to be provided to resilience zones. Comments are due July 25. For more information, contact Pamela Williams, FEMA, 202-212-8007.
HUD releases income limits
Income limits that determine eligibility for programs including public housing, Section 8 project-based, Section 8 Housing Choice Voucher, Section 202, and Section 811 have been posted online and took effect May 15. Income limits for Community Planning and Development programs including CDBG and HOME are available here and will be effective June 15.
Tribal input invited on environmental review
A Tribal/Interagency Environmental Streamlining Toolkit developed by the HUD-led Tribal Housing and Related Infrastructure Interagency Task Force is available for Tribal consultation. The toolkit is intended to provide Tribes with information and tools to create one environmental review when multiple agencies are involved in a Tribal housing project. The website can also serve as a hub providing environmental requirements for Tribal housing and related infrastructure from eight different federal agencies, and it offers guidance and best practices for coordination, including coordinating endangered species and historic preservation reviews. The task force requests feedback by June 9.
ReConnect regulatory changes confirmed
HUD and USDA move towards revising energy standards
Taking the first step in adopting revisions to their energy standards, HUD and USDA announced a preliminary determination that the changes do not negatively affect the availability or affordability of new construction of single- and multifamily housing covered by the relevant law. They relied on studies showing the incremental costs of the additional efficiency measures pay for themselves with energy cost savings on a life-cycle basis. Comments are due July 17. For more information, contact Michael Freedberg, HUD, 202-402-4366 or Meghan Walsh, USDA, 202-573-3692.
Feedback sought on Fannie Mae and Freddie Mac’s single-family pricing
After canceling fees it had previously announced, the Federal Housing Finance Agency is requesting input on the goals and policy priorities it should pursue in overseeing Fannie Mae and Freddie Mac’s single-family pricing framework, as well as the process for setting their single-family upfront guarantee fees. Comments are due August 14.
HAC comments on Greenhouse Gas Reduction Fund framework
Responding to an implementation framework released by the Environmental Protection Agency for the new $27 billion Greenhouse Gas Reduction Fund, HAC asked EPA to address the unique needs of rural and persistent poverty communities; ensure that nonprofit CDFIs and their nonprofit housing development partners are explicitly eligible for GGRF resources; increase clarity and reduce administrative burden on recipients; and exempt housing from Build America, Buy America requirements. EPA expects to announce funding availability as early as June.
PUBLICATIONS AND MEDIA
Digital technology can help elders age in place but has limitations
Centering the Home in Conversation about Digital Technology to Support Older Adults Aging in Place, published by Harvard’s Joint Center for Housing Studies, explores how digital technology can enable older adults to age in place by supporting activities of daily living as well as monitoring health and communicating information to healthcare providers. Barriers like housing problems and the digital divide, however, may limit effectiveness for rural elderly households.
Study examines U.S. trends for people experiencing homelessness
The State of Homelessness: 2023 Edition, published by the National Alliance to End Homelessness, uses HUD and Census Bureau data to provide information about homelessness in the U.S. on a given night in 2022 and to illustrate emerging trends by race/ethnicity, age, sheltered or unsheltered status, and other characteristics. Data is presented at the national, state, and Continuum of Care levels through an interactive dashboard.
Energy efficiency programs can become more equitable, research finds
Some customers and communities are underserved by energy efficiency efforts, according to Toward More Equitable Energy Efficiency Programs for Underserved Households, a new report from the American Council for an Energy-Efficient Economy. Utilities and other program administrators can use a variety of approaches to better serve low- and moderate-income consumers, renters, Black, Latino/a, rural, tribal, and non-English speakers, the study explains, with examples from both rural and urban areas. ACEEE also provides a variety of other energy equity resources, including Advancing Equity through Energy Efficiency Resource Standards, a report recommending state policies that could target energy savings for underserved households; an Energy Equity for Renters Toolkit; and a factsheet that summarizes the toolkit.
Rental incentive program makes workforce housing possible
Vermont Digger reports that the town of Woodstock will provide financial incentives to landlords in nearby towns to build or renovate units to house renters working at least 25 hours per week in Woodstock. Funding ranges from $2,500 for a qualified tenant with a one-year lease to $10,000 for four or more tenants with two-year leases.
National Rural Housing Conference set for October
Mark your calendars and save the date! HAC’s National Rural Housing Conference will be held October 24-27 in Washington, DC and online.
HAC invites poster session proposals for national conference
Researchers and policymakers at all levels can apply by June 2 to share their research and innovative ideas through a series of poster sessions at the 2023 National Rural Housing Conference, October 24-27 in Washington, DC. The research must be related to rural America and can be on housing or another field such as public health, community development, race and ethnicity, or creative placemaking. Posters will be reviewed and judged by a distinguished panel of rural experts. For more information, contact Manda LaPorte and Natasha Moodie, HAC.
Need capital for your affordable housing project?
HAC’s loan fund provides low interest rate loans to support single- and multifamily affordable housing projects for low-income rural residents throughout the U.S. and territories. Capital is available for all types of affordable and mixed-income housing projects, including preservation, new development, farmworker, senior and veteran housing. HAC loan funds can be used for pre-development, site acquisition, site development, construction/rehabilitation and permanent financing. Contact HAC’s loan fund staff at email@example.com, 202-842-8600.
Please note: HAC is not able to offer loans to individuals or families. Borrowers must be nonprofit or for-profit organizations or government entities (including tribes).
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