Last Wednesday, the DC Council passed a budget for fiscal year (FY) 2014, following nearly two months of deliberations on the proposal Mayor Gray introduced March 28. In contrast to previous years dealing with recession-impacted budgets which cut programs and services across DC government, this year both the mayor and Council found ways to increase funds for a variety of programs. Next year’s budget will help thousands of low-and-moderate income DC residents who are still struggling to recover from the recession, by boosting funds for affordable housing and homeless services, as well as giving additional resources to low-income families with children and residents with disabilities.
The allocation of funds requires one vote, but the Council will meet June 18 to take a second and final vote on additional laws needed to implement the budget, known as the Budget Support Act.
Some of the major changes in the FY 2014 budget that will help low- and moderate income residents include:
Help with rising housing costs. The FY 2014 budget includes significant increases to affordable housing. In addition to Mayor Gray’s proposed $100 million for affordable housing, the Council added funds for key affordable housing programs that had not received an increase in the mayor’s proposed budget.
The largest increase was to the Housing Production Trust Fund’DC’s main source for affordable housing construction and renovation’which received a $63 million one-time increase in FY 2013. The Council allocated additional dollars to the trust fund by identifying a new way to fund bonds that are used for New Communities, a DC program turning four public housing sites into mixed-income communities. Currently, funds from the trust fund are used to securitize the debt service on the bonds. The Council decided this year to switch to income-tax secured bonds, which are estimated to not only lowered the borrowing costs for the bonds, but will likely free up an additional $8 million for core trust fund purposes by FY 2017.
Funding for DC’s Local Rent Supplement Program–which provides rental subsidies to families with very low-incomes–increased by $6.75 million in FY 2014, including a $5 million increase for subsidies that are “project or sponsor based.” This part of the program gives rental subsidies to for-profit or non-profit housing operators to help make units affordable to very low-income residents. The Council also added $1.75 million to the “tenant based” side of the program, which provides rental assistance directly to families to help makes homes in the private rental market affordable. Increases to both sides of the program will help ensure that affordable housing is available now and in the future.
The FY 2014 budget will provide help to thousands of residents struggling to stay in DC in the face of rising housing expenses. Schedule H is a tax credit for lower-income residents when rents or property taxes are high relative to income, but the credit hasn’t been updated for 35 years, and its complicated rules make it hard for residents to claim it. The budget puts in place several improvements to Schedule H, including: an increase in the income ceiling from $20,000 to $40,000 next year and $50,000 in subsequent years; an increase in the maximum credit from $750 to $1,000; and provisions that will make it easier for people sharing housing to claim the credit.
Lastly, the budget also included legislation that will require more rigorous reporting on the outcomes of the New Communities program and that vacant tenant based local rental supplement rental subsidies are re-issued immediately, ensuring that rental subsidies do not go unused during the fiscal year.
Help for homeless residents. The FY 2014 budget also included many increases in funding to help homeless residents or residents at risk of homelessness. Increases included: an additional $2 million in funding for homeless youth over FY 2013 and FY 2014 (including $500,000 for LGBTQ youth), a $2.2 million increase in permanent supportive housing which provides housing to chronically homeless families and individuals, a $1.5 million increase in emergency rental assistance which helps prevent residents from becoming homeless (including $500,000 for a pilot program to extend emergency assitance to singles who are not elderly, do not have disability and/or children under 18), $173,000 to create a new position to oversee and implement a plan to end homelessness, and $400,000 to create a pilot program to extend rapid re-housing to individuals. Rapid re-housing moves people out of shelter quickly, and into housing with short-term rental subsidies and supportive services.
Help for vulnerable families and individuals. The FY 2014 budget included two changes to DC’s Temporary Assistance for Needy Families program that will improve the lives of vulnerable families with children. First, the mayor’s budget included a delay in the benefit cut for families who have been on assistance for longer than 60 months. With many families just now being able to access the improved services, we are pleased to see that the budget passed by the Council will give families some additional time to get back on their feet.
In addition, the Council also included funding to exempt some families with severe barriers from the time limit. Currently, DC exempts families from working while they are experiencing severe barriers, such as domestic violence or caring for a child with a disability, but not from the 60 month time limit. With the funds identified, the Council was able to provide an exemptions for many of these families.
The Council also identified funds to help increase access to DC’s Interim Disability Assistance program by $500,000, which will help provide monthly cash assistance to residents with disabilities who cannot work while they wait for their Supplemental Security Income (SSI) approval from the federal government.
Studying Ways to Improve Access to the Healthcare Alliance. The budget requires the Gray administration to examine issues that may be making it hard for residents to enroll or stay enrolled in the HealthCare Alliance, DC’s health program for uninsured residents who don’t qualify for Medicaid or other public insurance. Enrollment in the Alliance has fallen sharply in recent years, and this appears to be in part because of limited staff to process applications or re-certifications combined with a requirement that participants re-certify eligibility every six months. The budget calls for the Department of Health Care Finance to examine the re-certification process and to identify solutions to the long delays in the Alliance eligibility process that discourage eligible beneficiaries from recertifying and enrolling.
Investments in Education and Early Education. The budget includes an increase in funding to allow the District to serve more infants and toddlers with developmental issues and to provide services before a delay becomes severe. The budget for DC Public Schools requires art, music, physical education, and world language teachers, as well as a librarian, at all elementary school campuses. The Council took steps to ensure that all schools that had funding for a full-time librarian this year will retain that funding. The Council also adopted provisions to ensure no DCPS school would face more than a 5 percent reduction in its gross school budget from FY 2013 to FY 2014, and it re-established the Office of the Ombudsman for Public Education within the State Board of Education. This position had been eliminated in recent years.
Check back next week when DCFPI will publish its updated budget toolkit to reflect changes made to the FY 2014 budget at the final vote.
