The Bush Administration’s proposed budget for fiscal year 2006 includes $28.5 billion for programs administered through the Department of Housing and Urban Development, the agency said today. The spending plan proposes reforms and consolidation in some housing and development areas.
The 2006 HUD Budget also proposes a $1 billion increase in funding for the Housing Choice Voucher Program, commonly known as Section 8. The increase brings HUD’s total commitment to helping lower-income families find affordable rental housing to approximately $18.4 billion or 65 percent of the Department’s overall budget.
“This budget reflects some of the tough choices we must make to continue meeting our nation’s key priorities,” HUD Secretary Alphonso Jackson said. “Our commitment to expanding economic opportunity through homeownership continues and we will make certain we house and serve those who are most vulnerable.”
In releasing details of next year’s spending blueprint, Jackson said the President’s budget “will launch needed reforms, consolidate duplicative programs, and improve accountability in an effort to boost the effectiveness of HUD’s commitment to our nation’s cities, counties and smaller communities.”
The budget includes several programs designed to advance the President’s home-ownership agenda, which includes the American Dream Downpayment Initiative, the Zero Percent Downpayment Option, the Self-Help Homeownership Opportunity Program, and the Single-Family Affordable Housing Tax Credit.
The 2006 Budget provides $200 million to fully fund the American Dream Downpayment Initiative, which helps first-time home buyers with downpayment and closing costs.
The Zero Percent Downpayment Option would allow first-time buyers with a strong credit record to finance 100 percent of their home purchase including closing costs. The Budget also proposes a program called Payment Incentives, which would allow borrowers with limited or weak credit histories to purchase homes by initially paying higher mortgage insurance premiums that would gradually be reduced after a period of timely payments.
The Self-Help Homeownership Opportunity Program taps into the power of volunteerism. Those who benefit from SHOP funds contribute at least 100 hours of their own “sweat equity” to help make a house their home.
The Single-Family Affordable Housing Tax Credit aims to stimulate the production of affordable homes in distrressed communities where such housing is scarce. The Administration will propose a tax credit of up to 50 percent of the cost of new construction or rehabilitation.
In addition to these initiatives, the Bush Administration is proposing record levels of funding to house and serve homeless persons and families.
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