Bush's budget cuts housing funds

President Bush’s proposed budget might result in a loss of funding for local organizations that sponsor low-income housing and development.

Bush’s budget plan would move community development block grants from the Department of Housing and Urban Development to the “Strengthening America’s Communities Program” in the Department of Commerce.

The grants will be combined with other, similar programs to increase accountability, the White House says.

But under the president’s proposal, the combined program will allocate $3.7 billion in 2006. This year, the community grant program alone plans to give out $4.62 billion.

“The impression being given is that they’re cutting wasteful spending, but that’s not necessarily so,” said Chris Moran, executive director of the local Inter-Faith Council.

The IFC, which operates the community homeless shelter, and other local groups that sometimes use the grants are concerned about how funding cuts will affect their organizations.

“The issue is how the different pots of human-service dollars will affect entire communities,” Moran said. The IFC received $161,126 from federal grants last year.

“There has to be a gigantic pot of subsidies available for people of lesser incomes in order for them to survive in places like Chapel Hill and Carrboro,” he said.

Chapel Hill will receive $711,000 from the community development grants this year, said town Community Development Monitor Jamie Rohe.

The town distributes grant funds for community projects such as renovating public housing and rehabilitation programs for low- and moderate-income residents, Rohe said.

Though many are unsure of the long-term impacts from the cuts, the effects will be felt most strongly at the local level, said Jeff Caiola, co-director of EmPOWERment Inc.

The Chapel Hill-based organization helps finance small businesses and affordable housing opportunities for low-income individuals and families.

The group is not applying for grant funding this year because it plans to finish ongoing projects through existing money, Caiola said.

But with decreases in grant funding, nonprofits have to rely more on private donations — a discouraging prospect, he added.

“Private funding has never produced enough affordable housing,” he said. “As long as the economy continues to struggle, grants and foundations are going to struggle along with private donors.”

As the IFC looks to expand its men’s shelter, cuts to grant funding could affect its ability to secure resources, Finance and Operations Director John Dorward said.

“I can’t tell you that we can replace this money,” Dorward said.

“We have to go out and find it on the private side, and we all know that’s a group we’re asking a lot of these days.”

 

Contact the City Editor at citydesk@unc.edu.