[Hpn] Fw: NAMI E-News Senate Begins Work on Funding Bill of Housing and Veterans' Programs

H. C. Covington H. C. Covington" <icanamerica@bellsouth.net
Sat, 10 Aug 2002 01:07:02 -0500


Senate Begins Work on Funding Bill of Housing and Veterans' Programs
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NAMI E-News            July 30, 2002              Vol. 02-89
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The U.S. Senate has begun work on next year's budgets for the
U.S. Departments of Veterans' Affairs (VA) and the Housing and
Urban Development (HUD), including housing and homeless programs
serving adults with severe mental illnesses.

On July 25, the Senate Appropriations Committee cleared its
version of the FY 2003 VA-HUD spending bill (S 2797) - the
massive $91.2 billion measure that contains both the $32.1
billion HUD budget and $26.5 billion VA budget.

It is not expected that the full Senate will take up the VA-HUD
spending bill until after the August recess. Likewise, the House
Appropriations Committee will not begin work on its bill until
September at the earliest.

Congress is supposed to complete action on this measure before FY
2003 begins on October 1 - a goal Congress will be hard pressed
to meet.

Even though the federal government is now returning to an era of
budget deficits, the Senate Appropriations Committee was able to
include important increases for housing and veterans' programs of
importance to individuals with severe mental illnesses.

HOUSING PROGRAMS

1) HUD Section 811 Funding Increased But Below Amount Needed for
Existing Rent Subsidy Renewals 

The Senate VA-HUD bill includes a $9.65 million increase for the HUD
Section 811 program, bringing the program up to $250.5 million.

This is the same as the Bush Administration's request for the
program.

The Section 811 program provides funding to non-profit
organizations to develop group homes and other community housing
options that serve adults with severe disabilities, including
severe mental illnesses.

Section 811 is critical source of funding for housing for
non-elderly adults with severe mental illnesses.

In addition to adding funds for the 811 program, the Senate bill
also requires HUD to limit the amount of program funding that can
be diverted to tenant-based rental assistance, away from capital
advances to non-profits and project-based rental assistance (the
traditional form of 811 funding).

Tenant-based assistance, also known as a voucher, provides a
monthly rent subsidy to individual eligible low-income tenants,
thereby allowing them to select their own housing in the
community (typically without supports linked to the housing).

Capital advances and project-based assistance are by contrast
direct assistance to non-profit sponsors to increase the stock of
affordable housing for specific populations and typically
involves linking support services directly to housing.

In FY 2003, both the capital advance/project-based and
tenant-based ("mainstream") sides of the Section 811 program face
a continued challenge with respect to renewal of expiring rent
subsidies.

In both cases, these ongoing obligations to renew funding
associated with units already in existence are expected to drain
limited resources limited resources from the Section 811
program.

For the capital advance/project-based side, HUD estimates that $6
million will be needed to renew expiring project- based rent
subsidies (also known as PRACs).

On the tenant-based mainstream side, HUD projects that $32
million will be needed in FY 2003 to renew expiring tenant-based
rent subsidies that were originally funded in prior years.

This is an increase of $9 million over the amount Congress
allocated in FY 2002 for Section 811 tenant-based renewals ($23
million).

The end result is that the burden for renewing project-based and
tenant-based rent subsidies will drain off as much as $38 million
from the Section 811 program in FY 2003 - nearly 4 times the size
of the increase in the Senate bill.

This large and growing renewal burden is of great concern to the
Senate Appropriations Committee and a new requirement is included
in S 2797 requiring HUD to come forward with individual line-item
requests for renewals.

2) Homeless Funding Increased, Shelter Plus Care Renewal Funding
Added

The Senate VA-HUD bill includes a $92.5 million increase for
federal homeless programs under the McKinney-Vento Homeless
Assistance Act, bringing the program's funding up to $1.129
billion.

This is $85.5 million more than the Bush Administration requested
for FY 2003.

McKinney-Vento includes a range of permanent housing and service
programs such as Shelter Plus Care, SHP (permanent supportive
housing), Emergency Shelter Grants, Section 8 Moderate Rehab and
Single Room Occupancy.  Nearly all of these permanent and
transitional housing programs serve currently or former homeless
adults with severe mental illnesses and/or co-occurring substance
abuse.

The Senate bill continues the current policy of establishing a
minimum 30% set aside of overall homeless program funding for
development of permanent housing serving chronically homeless
people with disabilities - as opposed to services for homeless
individuals and families (the bill would also continue the 25%
local match required for services).

NAMI supports this policy as the most effective means of
developing at least 150,000 units of permanent supportive housing
and ending chronic homelessness among people with severe mental
illness.

The Senate bill builds on this policy by adding a requirement for
HUD to ensure that permanent supportive housing developed under
McKinney-Vento is actually targeted to chronically homeless
people with disabilities.

The Senate bill also includes $193 million for renewal of all
expiring rent subsidies under the Shelter Plus Care (S+C) program
and SHP permanent housing programs.

The Bush Administration did not request any funds for this
purpose. S+C is a critical permanent housing resource for adults
with severe mental illnesses.

Many S+C (as well as permanent supported housing, SHP) projects
that were begun in the 1990s are now facing a funding crisis as
5-year rent subsidies are now coming up for renewal.

In states and communities across the country, this housing is at
risk in cases where local officials are giving low priority
ratings to rent subsidy renewals as part of HUD's "Continuum of
Care" process for allocating federal homeless funds at the local
level.

Without separate funding for S+C and SHP renewals, thousands of
formerly homeless adults with severe mental illnesses will be
placed at risk of losing subsidized housing through no fault of
their own.

NAMI therefore supports continuation of BOTH the separate $193
million account for Shelter Plus Care and SHP permanent housing
renewals.

NAMI also supports efforts to renew these rent subsidies through
the much larger $17.4 billion Section 8 Housing Certificate Fund
(HCF) as proposed in separate House legislation (HR 3995).

3) Section 8 Vouchers Targeted to People With Disabilities

The Senate VA-HUD bill proposes to expand the existing allocation
of Section 8 tenant-based vouchers for non-elderly adults with
disabilities (including people with severe mental illnesses) by
$40 million.

Over the past five years, Congress has appropriated nearly $300
million for vouchers targeted specifically to individuals who
have lost, or will in the future lose, access to housing as a
result of designation of assisted and public housing as "elderly
only."

As in the past, the effort to push for a separate allocation of
tenant-based assistance for people with disabilities was
championed by Representative Rodney Frelinghuysen (R-NJ) and
Senator Kit Bond (R-MO).

NAMI is also grateful to the Chair of the Senate VA-HUD
Appropriations Subcommittee Barbara Mikulski (D-MD). This year's
allocation of $40 million is even more noteworthy since the
Senate was able to allocate only $90 million for 15,000 new
vouchers given tight budget constraints (in other words, nearly
half of all the new rental vouchers funded in the bill go to
people with disabilities).

The report accompanying S 2797 also directs HUD to increase its
oversight of housing authorities receiving disability vouchers to
ensure that they are targeted to the populations Congress
intended, i.e. non-elderly people with disabilities no longer
eligible for public and assisted housing properties that are
"elderly only."

The Senate Appropriations Committee report also directs HUD to
reform the Section 8 tenant-based program to address problems
that many voucher-holders experience in trying find decent and
safe housing in the rental market.

VETERANS PROGRAMS

The FY 2003 Senate VA-HUD Appropriations bill increases overall
spending for the Veterans Health Administration (VHA) by more
than $2.56 billion - and more than $1.14 billion above President
Bush's request.

The VHA budget includes funding for 172 medical centers and 876
outpatient clinics.  The VHA is one of the largest systems in the
country that provides both inpatient and outpatient psychiatric
care.

It is estimated that 454, 598 veterans have a service connected
disability due to a mental illness.  Of great concern to NAMI are
the 130,211 veterans who are service connected for psychosis
(104,593 of whom were treated in the VA for schizophrenia,
according to 1999 data).

The Senate Appropriations Committee report accompanying S 2797
contains a directive to the VA to continue studying and
developing recommendations for reforming the Veterans Equitable
Resource Allocation (VERA) system.

VERA is the VA's system for allocating health care dollars
according to the number of veterans with the highest priority
medical needs and best practices in the health care system.

In NAMI's view, the VERA system provides disincentives for
providing mental illness treatment - underfunding the cost of
providing services to veterans with severe mental illness by as
much as 20%.

In FY 2000, an additional $498 million was needed to make the
VERA allocation equal to the costs of its mental health cohorts. 
NAMI strongly supports a recommendation from the VA's own SCMI
Committee that the VHA ensure that the funding model is cost
neutral for care of veterans with severe mental illnesses.

For medical research at the VA, the Senate bill includes a $29
million increase over current funding (up to $400 million).

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