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Proposed Cuts to HUD would be Devastating to Philadelphia

Homeownership and Consumer, Housing

Proposed Cuts to HUD would be Devastating to Philadelphia

Yesterday, it was reported that the presidential administration is considering more than $6 billion in cuts to the Department of Housing and Urban Development (HUD), according to preliminary budget documents.

Community Legal Services opposes these cuts, which would cause significant harm to low-income Philadelphians and the entire City of Philadelphia.

The administration's preliminary budget documents would eliminate the long-running Community Development Block Grant (CDBG) program.  CDBG, created over 40 years ago by President Gerald Ford, provides direct federal investment in local programs to prevent homelessness, address blight, and support neighborhoods. Philadelphia currently receives $39 million a year in CDBG money.  It is the largest source of funding for Philadelphia's housing and community development programs.  

Each year, just over $5 million of CDBG money funds Philadelphia's nationally recognized mortgage foreclosure diversion program.  This program, administered jointly by the City and the Courts, brings homeowners who are behind in their mortgages together with their lenders to see if, under Court supervision, they can work out a plan to save their homes.  Since its founding in 2008, this highly successful diversion program has saved over 10,500 homes.

"The elimination of CDBG would be devastating for our clients and increase the number of homes that are lost to mortgage foreclosures every month," Michael Froehlich, Managing Attorney of CLS’s Homeownership and Consumer Rights Unit, said.  "Eliminating CDBG funding is penny wise and pound foolish."

The administration’s draft budget also proposes for funding for public housing to be cut by nearly $1.3 billion from its original 2016 funding.

This would have a profound impact on the Housing Choice Voucher Program, which issues “Section 8” vouchers, and is already suffering deep cuts since the 2013 sequestration. These cuts would also have a disastrous impact on public housing general operating funds, affecting Philadelphia Housing Authority’s (PHA) ability to administer safe, habitable, and healthy subsidized/public housing to low-income Philadelphians.

Though the proposed budget cuts do not directly target rental assistance programs, it will impact upon building maintenance and repair initiatives, where public housing properties are already facing a $25 billion dollar backlog in capital repair needs.

“Deep cuts to HUD’s budget would impact upon PHA’s ability to provide and administer safe and suitable housing for low-income and vulnerable families, which may lead to greater rent burdens and increased homelessness,” said Rasheedah Phillips, Managing Attorney of CLS’s Housing Unit. “With rising rents in private housing and the potential loss of thousands units of affordable housing in the next decade, we will see Philadelphia’s poverty crisis only deepen if public housing isn’t protected.”

Access to low income and affordable housing is vital to community stability, economic security, and upward mobility, and it provides vital social services to families most in need.

The proposed cuts to HUD would not only harm the families that rely on this housing, it would also create a greater burden on the City, which would be left to deal with the collateral consequences of increased homelessness.

About Community Legal Services, Inc.:

Founded in 1966 by the Philadelphia Bar Association, Community Legal Services (CLS) has provided free civil legal assistance to more than one million low-income Philadelphians. As the City’s oldest and largest legal services program, CLS represented approximately 10,000 clients in the past year. CLS assists clients when they face the threat of losing their homes, incomes, health care, and even their families. CLS attorneys and other staff provide a full range of legal services, from individual representation to administrative advocacy to class action litigation, as well as community education and social work. CLS is nationally recognized as a model legal services program. For more information, contact 215-981-3700 or visit www.clsphila.org.

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Date: 
03/09/2017