FY16 THUD Subcommittee Markup Bill Summary

Mara Stark-Alcalá w/Appropriations:             (202) 224-2667                                  
Chip Unruh w/ Reed Press Office:                 (202) 224-4642
Subcommittee Mark:  June 23, 2015
Washington, D.C. – The fiscal year 2016 Transportation, Housing and Urban Development, and Related Agencies (THUD) bill provides a total of $55.6 billion in discretionary budget authority, an increase of $1.88 billion from fiscal year 2015 and $7.3 billion less than the President’s budget request, excluding  the President’s proposal  to shift certain transportation accounts from discretionary to mandatory.  However, given reduced offsets – caused by a $1.1 billion decline in Federal Housing Administration receipts and a $2.3 billion increase in the cost of maintaining existing rental housing assistance – the bill actually represents a decrease of $1.9 billion below current funding levels.
The Subcommittee’s allocation conforms to the post-sequester caps under the Budget Control Act.  Not one Senate Democrat voted for these spartan spending levels because they fail to adequately protect America, build infrastructure, create opportunity, and spur economic growth.  We need a new budget deal, in the spirit of Murray-Ryan, that stops hollowing out investments in America’s future.
U.S. Senator Jack Reed (D-R.I.), Ranking Member of the Transportation, Housing and Urban Development, and Related Agencies Subcommittee, said:
“Chairman Collins is a truly bipartisan leader and I know how hard she has worked to maintain funding for some critical programs we both support, but the unrealistic discretionary spending level the Subcommittee was given to work with makes it impossible to avoid cuts to essential transportation, housing, and community priorities.  Neglecting transportation and public housing responsibilities at the federal level overburdens states and local communities and leads to more congestion, pollution, and job losses.  We can’t afford to go further down that road.  I will continue working with Chairman Collins to try to strategically leverage federal dollars for critical housing and transportation priorities that generate benefits for all Americans.  Ultimately, the solution lies in a new, bipartisan budget agreement that allows the federal government to responsibly fulfill its obligations and help strengthen our nation’s infrastructure.”
Key Points & Highlights
This bill provides funding for the Department of Transportation (DOT), the Department of Housing and Urban Development (HUD), and related agencies.  These agencies manage many of the programs that build our nation’s transportation network and support the housing and economic development of our communities.  For DOT, the bill provides critical federal highway and transit grants that help commuters get to work, businesses get their products to market, and families connect with one another across the country.  For HUD, the bill funds necessary rental housing assistance programs and the Community Development Block Grant Program (CDBG), which gives local governments the resources they need to develop communities, support businesses, create jobs and ensure the availability of decent, affordable housing. 
Due to the unrealistic sequester funding limits under the Republican budget, federal investments in these important programs are cut to inadequate levels, costing jobs and economic growth.
This bill slashes funding for transit systems across the country, and forces the Federal Aviation Administration (FAA) to put off essential maintenance for its facilities and equipment.  The bill dramatically cuts the Public Housing Capital Fund to a 1988 funding level, reduces Choice Neighborhoods to a historically low level, and essentially eliminates the HOME program – the nation’s most targeted source of funding for affordable housing production.
  • Federal Transit Administration - New Starts:  The bill funds the transit New Starts program at $1.6 billion, which is $336 million less than the House bill, $535 million less than fiscal year 2015, and $1.7 billion less than the President’s budget request.  This is the lowest level provided for the New Starts program in ten years. 
Transit ridership continues to grow, but transit systems across the country are struggling to keep up with the increased demand for service.  The New Starts program supports major investments in transit infrastructure that would be impossible for local governments and transit agencies to finance alone.  With 60 projects in the pipeline, demand for New Starts grants exceeds the amount of funding available.
According to DOT, public transit saves 4 billion gallons of gasoline, prevents 37 million metric tons of carbon dioxide emissions and saves travelers 646 million hours of commute time.  Furthermore, $1 billion invested in public transit supports about 13,000 jobs and creates $3.5 billion of economic activity. 
  • Federal Aviation Administration (FAA):  The bill would fund the Federal Aviation Administration at $16 billion.  This funding level is $164 million more than fiscal year 2015, but the vast majority of this increase is necessary just to maintain the agency’s workforce of air traffic controllers and to support day-to-day operations.  The increase for the FAA’s operations is provided at the expense of the agency’s facilities and equipment.  The bill would keep funding FAA’s infrastructure at $2.6 billion, which is about the same level that the agency has received each year since 2013.  This funding level is also $255 million lower than the level of needs identified in the President’s budget request.  The FAA currently faces a backlog of $5 billion in maintenance needs, and deferring these needs increases the risk of breakdowns in our air traffic control system.
  • HOME Investment Partnerships Program (HOME):  The bill dramatically reduces the HOME program from $900 million in fiscal year 2015 to just $66 million in fiscal year 2016 – a devastating cut of $834 million, which will result in the loss in production of approximately 40,000 affordable housing units for fiscal year 2016.  The HOME program helps states and local governments increase housing affordability through the building, buying or rehabilitation of affordable housing that is made available for rent or homeownership.  This funding level forces communities to dramatically reduce or eliminate affordable housing assistance where units are otherwise limited or unavailable to low income families and individuals.
  • Public Housing:  The Public Housing Capital Fund faces a reduction of $132 million from fiscal year 2015 levels.  This funding level would force Public Housing Agencies to prioritize how they address the more than $3 billion in accrued capital need, leaving a majority of public housing capital needs unmet.  As the nation faces an aging public housing stock, at 1980’s funding levels, the more than 1.1 million currently assisted households remain at-risk of living in units that may be unsafe, inaccessible and unsecure.
  • Community Development Block Grant (CDBG):  The Senate bill cuts $100 million from the fiscal year 2015 funding for CDBG, a three percent cut for state and local government grantees.  The CDBG program provides grants to states and local governments to support housing and economic development projects in urban and rural communities across the county. These funds can be used to address a variety of needs from revitalizing distressed areas by improving streetscapes and sidewalks and supporting small businesses, to removing blight and assisting seniors and others with home repairs.  CDBG helps communities develop projects that meet their unique needs and support efforts to create jobs. 
The number of communities eligible for CDBG has more than doubled over the last 40 years, from almost 600 grantees to approximately 1,200.  Yet, funding for this program continues to decline.  Funding CDBG at this level isn’t enough, it fails to even maintain grant sizes let alone support the growing needs.  This means communities will be forced to scale back critical investments and revitalization efforts that benefit low and moderate income families, create and retain jobs, and put communities on the path to sustainability and growth.
  • Choice Neighborhoods:  Choice Neighborhoods is cut to $65 million, $15 million less than fiscal year 2015 and historically the lowest level of funding since the program’s inception in fiscal year 2010.  The program is already only able to meet less than 20 percent of demand.  This level of funding may also result in the elimination of Choice Neighborhoods Implementation Grants that transform communities and leverage private investment.   They are key tools for state and local governments to redevelop severely distressed public or HUD-assisted housing and bring comprehensive neighborhood revitalization to devastated areas.
  • Texas Truck Weight Exemption:  The Senate bill includes provision that exempts I-69 in Texas from federal truck weight limits. 
As I-69 becomes a part of the interstate system, it will have to meet federal interstate standards, which include a limit on truck weights.  The provision in the Senate bill would allow heavier trucks to continue using I-69 after it has become a part of the interstate system.
Nearly 4,000 people die in crashes with large trucks every year, and state and local governments continue to struggle to bring our roads and bridges into a state of good repair.  The condition of our nation’s roads earned an embarrassing “D” and our bridges earned a paltry “C+” from the American Society of Civil Engineers’ most recent report card on the nation’s infrastructure.  The Department of Transportation is expected to complete a comprehensive study on the impact of truck size and weight on safety, the condition of our nation’s infrastructure, and other issues.  Congress should not change truck size and weight limitations until it has this study in hand and can debate the issue through consideration of a comprehensive transportation authorization bill.
  • Pilot Program:  The Senate bill includes a provision that would allow public-private partnerships to be exempt from almost all transit New Starts criteria. 
Under the New Starts program, the Department of Transportation conducts an extensive evaluation of each project to ensure that it represents a good use of taxpayer dollars.  The Department’s evaluation not only assesses the project’s financial strength, but also examines many other considerations such as the extent to which the project is consistent with local land use policies and the extent to which the new transit service would serve low-income or underserved populations. 
Current law authorizes a pilot program that would allow public-private partnerships to be exempt from New Starts requirements in order to access federal funds more quickly.  Under the Senate bill, public-private partnerships participating in the pilot program would have to prove that they have the financial capacity to complete the project, but they would be exempt from all other New Starts requirements.