Testimony of Angie Rodgers, Policy Analyst DC Fiscal Policy Institute at the Public Hearing on the Fiscal Year 2006 Budget Request for the DC Housing Authority District of Columbia Committee on Consumer and Regulatory Affairs

Chairman Graham and members of the Committee, thank you for the opportunity to speak today.  My name is Angie Rodgers, and I am a policy analyst with the DC Fiscal Policy Institute.  DCFPI engages in research and public education on the fiscal and economic health of the District of Columbia, with a particular emphasis on policies that affect low- and moderate-income residents.

I am here today to support a local funding appropriation for the DC Housing Authority in the FY 2006 Budget, and also to recommend emergency or supplemental funding to address the agency’s budget shortfall for FY 2005.  DCHA, like housing authorities all over the country, faces a shortfall in federal funding that is likely to continue in the coming years.  Funding for these agencies have already been scaled back, and if Congress adopts President Bush’s FY 2006 budget proposal for the Section 8 program, the District will see a reduction of almost $30 million in funding over the next 5 years.  These cuts in funding could mean the loss of vouchers and/or the implementation of other policies that would threaten the ability of low-income households to find and keep affordable rental units.  DCHA has already had to implement such policies to account for cuts that have already been made, including not reissuing vouchers when families leave the program and reducing the maximum rent to which a voucher can be applied.  In a housing market where, according to U.S. Census data, the average rent almost doubled between 1990 and 2003, these policies make it increasingly difficult for families to afford housing.

The FY 2006 budget request would shift responsibility for the Housing Authority police to MPD.  This will provide $4.5 million in savings to DCHA, which it can use to address the federal funding shortfall.  This is not likely to be sufficient, however, to alleviate their entire shortfall.

Local funding for affordable housing is not a new idea, so by all means we should not begin this conversation as if there is no precedence.  According to a 2004 DCFPI analysis on DC budget trends, there was $57 million in funding in 1990 for programs like the Tenant Assistance Program ‘ which provided funding to as many as 3,000 households ‘ and the Home Purchase Assistance Program ‘ which provided low- and no-interest loans to help low- and moderate-income residents buy their first home.  By 2000, however, funding had fallen by 90 percent to $4.5 million.  Several housing programs and services targeting low- and moderate-income residents were eliminated or reduced.  Though the level of funding has recovered from the fiscal crisis that caused reductions in the 1990s, much of the increase is the result of the Housing Production Trust Fund.  Increased funding for the Housing Production Trust Fund, however, does not compensate for the loss of funding for rental subsidies, since the Trust Fund cannot be used for this purpose.  (All figures here are adjusted for inflation to equal 2005 dollars.)

Lack of affordable housing is a serious issue in the District on many fronts.  DCFPI released a report in January that shows that DC lost almost 5,000 of its affordable rental units in just the period between 2000 and 2003.  Moreover, DCHA can attest very well to the fact that they are serving over 10,000 households in their voucher program, but they have over 40,000 households on their wait list.  I am here to support a local appropriation for DCHA, but while I am doing that I want to emphasize that many segments of our population are affected and that this is a bigger problem than DCHA’s shortfall and whatever local money they might get.  Lack of affordable housing affects low-income households, the homeless who cannot find affordable permanent housing in which to transition, people with disabilities, our mental health population, and our HIV/AIDS population.  All of these different groups are filled with people who are trying to move towards self-sufficiency but find it increasingly difficult to do so.  More funding for DCHA is a step in the right direction, but I hope that this would be the beginning of a conversation and not the end.

Finally, I want to go back to the analysis of affordable housing done in January.  We found that the households below 30 percent of AMI are bearing the brunt of this city’s housing burdens.  Some 80 percent of them pay more for their housing than what is considered affordable.  We are all concerned about the increases many renters and owners are seeing in this city, but it is important to point out that this does not necessarily mean that they are facing housing burdens.  It does not mean that they are making the difficult trade-offs between housing, food, health care, clothing, and utilities like most extremely low-income households who are trying to absorb those same escalating housing prices.  DCHA’s programs reach the level where we know the problem exists most egregiously ‘ those extremely low-income households.  These programs are the main vehicles in the District for providing affordable rental housing for low-income households.  While they provide housing to a substantial number, there are many on their waiting lists.  Any loss would be significant.

Thank you and I am happy to answer any questions you may have.