The cry of the slashed budget
As heralded in the State of the Union address, and long anticipated or feared, the President’s proposed FY 2006 budget (pdf) makes clear that the 2005 legislative debate will be dominated by domestic spending issues — meaning cuts:
President Bush today unveiled a $2.57 trillion budget that eliminates dozens of politically sensitive domestic programs, including funding for education, environmental protection and business development, while proposing significant increases for the military and international spending.
The budget comes down hard on affordable housing, as noted by Congressional Quarterly (subscription required):
The largest single reduction in discretionary spending next year would come from Housing and Urban Development (HUD) programs, which would see an 11.5 percent cut from $32.2 billion in fiscal 2005 to $28.5 billion in fiscal 2006.
HUD’s largest expenditure is Section 8 rental assistance, which is already under pressure, accelerating the debate about possible reforms, as we outlined in a lengthy concept paper for Living Cities.
HUD will suffer more in the spending squeeze than
its current appropriations subcommittee big brother, Veterans:
The White House is asking for a 2.1 percent boost for the Veterans Affairs Department — less than half the increase it asked for last year.
This brings into clearer focus recent plans to eliminate VA-HUD as a subcommittee and send its orphaned departments elsewhere:
Spending under the jurisdiction of the Veterans Affairs, Housing and Urban Development, and Independent Agencies Appropriations Subcommittee would take a 3.2 percent reduction — falling by $3 billion from fiscal 2005 levels.
And the Washington Post notes that:
On the domestic side, the budget would consolidate 18 community development block grant programs into one Commerce Department program for a savings of $1.8 billion.
UPDATE: NCSHA clarifies the CDBG consolidation:
On the spending front, HUD Secretary Alphonso Jackson and Commerce Secretary Donald Evans announced February 3 that the Administration’s FY 2006 Budget will recommend that Congress consolidate 18 economic and community development grant programs—including CDBG—and move the programs, currently housed within five different federal agencies, into the Commerce Department. The Administration will propose spending $3.7 billion on these programs in FY 2006, down from a total of $5.3 billion this year.
