DEPARTMENT OF HOUSING
AND URBAN DEVELOPMENT

FOCUSING ON THE NATION’S PRIORITIES

Meeting America’s Most Critical Housing Needs

    The President’s 2008 Budget supports nearly five million housing units across public housing, Section 8 voucher, and other assistance programs. These programs offer individuals and families critical rental support, much needed stability, and the opportunity to move toward self-sufficiency. Proposed changes to the voucher program will give public housing authorities incentives to serve more households, and will update the funding allocation formula to better reflect current needs. Furthermore, the Budget gives public housing authorities (PHAs) efficiency-enhancing incentives to maximize the impact of their resources by eliminating the cap on the number of units they can fund and encouraging them to spend their balances effectively. By tapping unspent excess balances at PHAs, the President’s proposal will serve a significant number of additional low-income families. The continued support of the Department of Housing and Urban Development’s (HUD’s) core programs remains at the heart of the Department’s mission.

Supporting Homeownership through Innovative Programs

Source: Department of Housing and Urban Development.

    The HOME Investment Partnerships Program. The HOME program is the largest Federal housing block grant program to States and localities, delivering nearly $2 billion in proposed funding with the primary goal of creating affordable housing for low-income families. The HOME program helps build partnerships between governments and local organizations, such as nonprofit groups, that collaboratively fund and execute a wide range of activities, including building, buying, and rehabilitating affordable housing. In addition to growing the affordable housing stock and assisting first-time homebuyers with down payment and/or closing costs, the HOME program also provides direct rental assistance to low-income individuals and families. HUD’s HOME program posted record performance during 2006 when more than 143,000 households were reported as benefitting from hundreds of local programs that HOME supports. The spike in HOME’s affordable housing production is due in part to more accurate reporting and in part to HUD’s aggressive effort to boost performance measurement.

    The American Dream Downpayment Initiative (ADDI). The HOME program includes ADDI, which is an Administration priority to further increase the number of minority and first-time homebuyers. ADDI furthers homeownership, particularly among minorities, by lowering barriers that may prevent potential homebuyers from entering the market, such as high down payment requirements. As a result of this effort and others like it, HUD has helped the Nation achieve an unprecedented homeownership rate of nearly 70 percent.

    The Federal Housing Administration Mortgage Program. In 2002, the President issued America’s Homeownership Challenge to increase first-time minority homeowners by 5.5 million through 2010. The Federal Housing Administration (FHA) mortgage program is an important tool for reaching that goal. In 2006, 31 percent of those using FHA mortgages were minorities purchasing their first home. The 2008 Budget continues Administration efforts to modernize FHA by improving its ability to reach traditionally underserved homebuyers, such as low- and moderate-income families, individuals with blemished credit, and families who have little savings for a down payment. The Administration’s proposal would base mortgage insurance premiums on the risk of the loan based on traditional credit variables, including the borrower’s credit profile and the loan-to-value ratios. This will result in more families having access to market-rate mortgage financing and will provide financial incentives for families to improve their credit histories or save for a down payment.

Working to End Chronic Homelessness

    The 2008 Budget continues the Administration’s commitment to end chronic homelessness by creating new supportive housing options for these individuals. Chronically homeless persons are identified as individuals who have been on the street for long periods and have an addiction and/or suffer from a disabling physical or mental condition. Across the country, local leaders and nonprofit organizations have embraced this goal with over 200 jurisdictions committing to 10-year plans to end chronic homelessness. A number of the jurisdictions that have implemented their plans are seeing steady decreases in the number of chronic homeless individuals on their streets and in shelters. The Budget proposes a $50 million increase, to $1.6 billion, for HUD’s Homeless Assistance Grants, which received an Effective rating in the 2006 Program Assessment Rating Tool assessment due to its strong program design and performance measures.

Using the Community Development Block Grant (CDBG) Program Effectively

    The President’s Budget provides $3 billion for CDBG and advances a reform agenda that will distribute resources more equitably and promote efficiency. The current CDBG formula allocates a disproportionate amount of resources to areas with relatively few critical development needs while other, needier areas go underserved. Additionally, HUD continues to work with State and local authorities in the stewardship of $16.7 billion in supplemental CDBG disaster funds to assist in the long-term recovery and rebuilding of the Gulf Coast. Ensuring the effective and proper use of these funds is critical to both the region and the American taxpayer.

Managing for Success

    In the past several years, HUD has taken many notable steps in improving its management and performance, and the President’s Budget strengthens these efforts. HUD recently completed a comprehensive workforce analysis and is now working to implement critical findings, such as optimizing its human capital structure. Furthermore, technology investments are helping HUD gather and utilize data to improve its programs and management agency-wide. HUD is also continuing to reduce its improper payments and build improved financial systems to better serve both taxpayers and its clients. These efforts and others like them have helped HUD garner several noteworthy recognitions, such as improving its internal controls to eliminate any material weakness in the Department’s annual financial audit and gaining recognition as a leader among Federal agencies in information technology use.