Passing the Buck: The Administration’s “Flexible Voucher Program” Would Compel Housing Agencies to Impose Deep Cuts In 2005 and Subsequent Years

Publication Date: March 2004

Publisher: Center on Budget and Policy Priorities (Washington, D.C.)

Author(s): Will Fischer; Barbara Sard

Research Area: Social conditions

Keywords: Low-income housing; Economic inequality; Housing assistance; Housing subsidies

Type: Report

Abstract:

The Administration’s budget contains a proposal both to replace the existing Housing Choice Voucher Program with a new “Flexible Voucher Program” that is essentially a block grant and to cut voucher funding substantially. In 2005, the budget would cut funding by more than 12 percent below the level needed to maintain current services. The proposal also would cut the administrative funding provided to public housing agencies to operate the voucher program. Under the proposal, PHAs would be forced to institute substantial reductions both in the assistance they provide to low-income families and in their own administrative infrastructures.

The cuts that PHAs would have to impose would likely grow more severe after 2005. Under the proposed block grant, funding levels would no longer be tied to the cost of maintaining the current number of vouchers; funding could instead be frozen from year to year or rise much more slowly than rental costs. Adding to this problem, block grants have historically proven easier to freeze or cut than other programs, in part because of the difficulty of identifying the specific consequences of freezing or reducing federal funding for programs that operate as block grants.