Cortney Watson. Manager, Congressional Relations and Advocacy. National Association of Housing and Redevelopment Officials (NAHRO)

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1 Cortney Watson Manager, Congressional Relations and Advocacy National Association of Housing and Redevelopment Officials (NAHRO)

2 NAHRO represents over 23,000 affordable housing and community development professionals Most notably we represent most housing and redevelopment authorities across the country 81% of the section 8 voucher units 87% of the public housing units Besides the public housing and section 8 programs our members also utilize CDBG, HOME, Section 108 Loan program, homeless assistance programs, etc.

3 Political Environment and the THUD Bill Problems at the local level for NAHRO Members Why CDBG and other HUD programs are and will continue to be a target for cuts

4 Focused on reducing spending and deficit reduction (and the elections!) 5.3 percent reduction in FY 2012 in non-security discretionary spending from FY 2011 levels under the Budget Control Act 2013 T-HUD allocations: Will likely be similar to last year, but House will start off significantly lower BUT don t forget about sequestration! (an additional 9% cut on average for non defense discretionary programs occurs in Jan.) This is just the beginning: deficit reduction deal stretches over next decade

5 Public Housing continues to deteriorate, tenant rents may increase Housing Authorities are struggling to administer their programs due to decreased administrative funds and depleted reserves NAHRO study predicts 100,000 less families will be able to utilize the voucher program, not to mention lost jobs Local Examples: Housing Authority of County of LA City of Palm Springs Housing Authority of Fresno

6 CDBG has been cut by 26% since FY 2010 FY 2012 used CDBG to funds disasters Unfortunately Administration proposes level funding in FY 2013 Predictions for FY 13-funding, disaster, planning cap?

7 $ in Billions Community Development Block Grant (CDBG) Program FY FY 2012 $4.0 $3.71 $3.59 $3.64 $3.99 $3.5 $3.36 $3.0 $2.95 $2.95 $2.5 $2.0 $1.5 $1.0 FY 2007 Enacted FY 2008 Enacted FY 2009 Enacted FY 2010 Enacted FY 2011 Enacted FY 2012 Enacted FY 2013 Proposed Note: This chart shows CDBG formula grants only. This chart does not include the $1 billion in special CDBG formula funding provided through the American Recovery and Reinvestment Act of 2009.

8 Non defense discretionary cuts are the easiest target but the least useful solution in deficit reduction efforts Reduced T-HUD allocation makes CDBG one of the most vulnerable accounts CDBG itself has some inherent messaging problems We need you to participate/advocate in all three of the above points!

9 Interest on National Debt 6% FY 2011 Federal Spending Housing Assistance and Community Development Makes Up 2% of Spending Other entitlement programs 15% Defense Discretionary 19% Housing Assistance and Community Development 2% Medicaid and CHIP 8% Social Security and Medicare 34% Other Non-Defense Discretionary 16% Source: Center on Budget and Policy Priorities

10 Thank You!! Cortney Watson

11 APA 2012 National Planning Conference April 16, 2012 Erica Williams Policy Analyst, State Fiscal Policy Center on Budget and Policy Priorities

12 Largest State Budget Shortfalls on Record

13 State Shortfalls After Use of Recovery Funds (Including August Extension)

14 How States Closed Budget Shortfalls FY08 to FY12

15 Most States FY12 Spending is Below Pre-Recession Levels

16 State And Local Government Payrolls Are Shrinking

17 Twenty-Nine States Have Projected or Have Addressed Shortfalls For FY13

18 Continued Revenue Growth of 8.3% Would Not Restore Losses From Recession Until FY19

19 Budget Control Act (BCA) July 2011 Nearly $1 trillion over ten years in discretionary cuts beginning October PLUS Sequestration kicks off another $1.2 trillion cuts (mostly discretionary) over nine years beginning January cbpp.org 9

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22 Clock is Ticking October: new fiscal year begins; short extension likely Elections!! Late 2012: need to raise debt limit December 2012: tax cuts expire January 2013: sequestration hits

23 What Should States (Not) Be Doing?

24 Major Tax Cuts, Threatened or Enacted

25 A Balanced Approach

26 Be in Touch (

27 The American Planning Association National Conference April 16, 2012 The Fiscal State of the States

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29 30% of the unemployed have been jobless a year or more 35% Total Unemployment Rate and Long-Term Unemployment Rate 30% 25% 20% 15% 10% 5% 0% 35% 30% 25% 20% 15% 10% 5% Total Unemployment Rate and Long-Term Total Unemployment Rate Percent of Total Unemployed Who Have Been Jobless For a Year or More SOURCE: Pew analysis of Current Population Survey data. Total Unemployment Rate NOTES: Data is not seasonally adjusted; Data is shown by quarter. 0% Percent of Total Unemployed SOURCE: Pew analysis of Current Population Survey data. NOTES: Data is not seasonally adjusted; Data is shown by quarter.

30 State revenues are slowly bouncing back Sources: Pew analysis of the U.S. Census Bureau s State & Local Tax data

31 States still have budget gaps to fill Source: National Conference of State Legislatures, State Budget Updates

32 States enacted most revenue increases for FY Source: The NASBO and NGA Fiscal Survey of States, Fall 2011

33 In FY12, most states spending less than in FY08 SOURCE: CBPP analysis of governors budgets and other state budget materials.

34 Current fiscal trajectory is unsustainable State and Local Government Operating Balance, 2005 to Source: GAO Simulations, updated April 2012.

35 Health care costs are the biggest factor Source: GAO simulations, updated April 2012.

36 Local budgets squeezed by decline in property values

37 Decline in state aid

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39 Overall: How are states doing?

40 Scope: What can states do?

41 Quality: What can states do?

42 Criteria for effective evaluation

43 STAY CONNECTED

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