Biden Administration Proposes $5.8T Fiscal 2023 Budget: Tax Hikes; Spending Increases; $72B for HUD
The Biden Administration on Monday submitted a record $5.8 trillion budge proposal for fiscal year 2023 to Congress, including a nearly $12 billion increase for HUD over fiscal 2022.
The budget includes proposed tax hikes targeting wealthiest Americans while boosting spending for a number of domestic and military programs.
In a statement, President Biden said the budget would reduce the budget deficit by more than $1 trillion over the next 10 years.
“Budgets are statements of values, and the budget I am releasing today sends a clear message that we value fiscal responsibility, safety and security at home and around the world, and the investments needed to continue our equitable growth and build a better America,” Biden said.
While every department of government gets an increase ranging from 5% (Homeland Security) to 31 percent (Commerce Department), the budget includes a notable 21 percent hike for HUD, to $71.9 billion—$11.6 billion than the 2022 annualized continuing resolution level.
In a statement, HUD Secretary Marcia Fudge said the budget proposal outlines an “ambitious agenda to address challenges our nation faces,” ranging from climate change to housing discrimination to racial equity in homeownership and rental housing, to ending homelessness.
“HUD’s mission is critical to achieving the President’s vision to build a better America—one where we are ensuring that every person has a shot to get ahead and addressing longstanding systemic challenges, including racial injustice, rising inequality and the climate crisis,” Fudge said. “This Budget will help us meet our mission to provide security and stability for those who live on the outskirts of hope, advance opportunity and equity on behalf of marginalized communities and meet the existential threats posed by natural disasters and climate change.”
Highlights of the proposed HUD budget (language taken directly from the proposal):
• Support Underserved Communities and Equitable Community Development. The Budget fortifies support for underserved communities and supports equitable community development. To house more people experiencing housing insecurity, the Budget provides $32.1 billion for the Housing Choice Voucher Program, which accommodates 200,000 new vouchers – the largest one-year increase in vouchers since the program was authorized in 1974. It also provides $8.8 billion for the Public Housing Fund, which provides grants to Public Housing Authorities to operate, maintain and make capital improvements to 1.7 million residents of public housing. The Budget also addresses the nation’s homelessness, crisis, providing $3.576 billion, an increase of $576 million, for Homeless Assistance Grants. Additionally, the Budget provides $3.8 billion for the Community Development Block Grant Program to remove barriers and revitalize 100 of the most historically underserved neighborhoods in the United States, and $86 million for fair housing programs for targeted and coordinated enforcement, education and outreach.
• Increases Supply of and Access to Affordable Housing. The Budget requests $35 billion for the Housing Supply Fund, a new mandatory program providing grants to State and local housing finance agencies and their partners to invest in strategies to increase the supply of affordable housing. Additionally, the Budget provides $2 billion for the HOME Investment Partnerships Program. It proposes $15 billion to fully fund renewals and amendments in the Project-Based Rental Assistance, Housing for Persons with Disabilities and Housing for the Elderly Programs, along with $180 million for new development in Section 202 Housing for the Elderly and Section 811 Housing for People with Disabilities. The Budget also proposes Ginnie Mae authority to securitize affordable multifamily housing loans made by Housing Finance Agencies and insured under the Federal Housing Administration’s Section 542(c) Risk-Sharing program.
• Promote Homeownership and Wealth-Building. The Budget provides $15 million of credit subsidy through FHA for a Home Equity Accelerator Loan (HEAL) Pilot that would test new loan products designed to lower barriers to homeownership for first-generation and/or low-wealth first-time homebuyers. Additionally, the Budget provides a new $100 million set-aside under the HOME Program for the FirstHOME Downpayment Assistance initiative that would provide funding to States and insular areas to better support sustainable homeownership for first-generation and/or low-wealth first-time homebuyers.
• Advance Sustainable Communities, Climate Resilience and Environmental Justice. The Budget provides $1.1 billion in targeted climate resilience and energy efficiency improvements in public housing, Tribal housing, multifamily-assisted housing, and other assisted housing. In addition, it provides $400 million to remove dangerous health hazards from homes, including mitigating threats from fire, lead, carbon monoxide, and radon. It provides $250 million to help communities develop and implement locally driven comprehensive neighborhood plans to transform underserved neighborhoods. The Budget also supports authorizing the Community Development Block Grant-Disaster Recovery (CDBG-DR) program and Ginnie Mae’s continuing Environmental, Social and Governance disclosure efforts, which are intended to drive new liquidity to more environmentally sustainable products by meeting growing investor demand.
• Strengthen HUD’s Internal Capacity to Carry Out Its Mission. The Budget requests $1.8 billion toward salaries and expenses, $306 million more than the annualized CR level for 2022, which, in combination with carryover of 2022 funding, would support 8,326 full-time equivalent employees. The 2023 Budget will support the gains made in 2021 and projected for 2022 and provide for continued increases in staffing, which will enable the Department to more effectively and efficiently serve households and communities across the country. The Budget also proposes $382 million for the IT Fund, to continue to invest in modernization of HUD’s IT systems, infrastructure and cybersecurity.
Also of note, the proposed fiscal 2023 budget includes $119 billion for the Department of Veterans Affairs—a 32 percent increase from current levels—and a 20 percent increase for the Treasury Department, to $20.5 billion.
To generate more revenue and to reduce the deficit, the proposed budget would impose a minimum 20 percent tax on U.S. households worth more than $100 million. It would eliminate certain loopholes and target “full income,” which includes standard taxable income an unrealized gains, such as those from stocks. it would also raise the corporate tax rate to 28 percent; the current rate is 21 percent.
More information on the Administration’s FY 2023 Budget can be found here.
