Effect of Federal Shutdown on HUD Housing Assistance and Community Development programs

WASHINGTON, D.C. – October 8, 2013 – (RealEstateRama) — As you likely know, the House and Senate failed to agree on a “Continuing Resolution” (CR) to provide short-term funding for fiscal year 2014, which began October 1, and Congress hasn’t enacted any FY14 appropriations bills. Without 2014 funds to use to pay for agency operations, a large share of federal employees have been furloughed, including 96 percent of HUD staff. At this point, it is unclear how long the partial shutdown will continue. There is no clear “end game” in sight, though many observers believe that the October 17th deadline to raise the debt ceiling or risk default on federal payment obligations may lead Congress and the President to resolve the shutdown, as well, around that time if a CR is not enacted before then.

Based on our understanding of program funding and operations, as well as HUD’s posted contingency plan dated October 2, 2013 (view HUD’s contingency plan under “featured news” on HUD’s website, www.hud.gov ), this memo is our assessment of the consequences of the lack of new FY14 funding on particular housing and community development programs. Overall, the shutdown may exacerbate some of the harm caused by sequestration cuts in effect since March 2013 by reducing the number of families receiving housing voucher assistance, and the impacts on low-income families, program administrators and property owners may worsen significantly if the shutdown extends beyond October.

By Barbara Sard
Federal Policy