U.S. Plans New, Deep Cuts in Housing Aid
By DAVID W. CHEN
The New York City Housing Authority could lose up to $166 million, or almost a quarter of its annual federal subsidy for operating costs, under a new cost-cutting proposal by the Bush administration that could force dozens of housing agencies nationwide to fire maintenance workers, reduce services or close buildings.
If the changes sought by the administration take effect, they will result in one of the biggest cuts since Washington first began subsidizing housing: as much as $480 million, or 14 percent, of the $3.4 billion federal budget for day-to-day operations, including labor, maintenance, insurance and utilities, at the nation's 3,100 housing authorities. Housing authorities in New York State would be among the hardest hit, under a new formula that works against older urban areas.
"I've never seen anything this devastating occur in public housing," said Stephanie W. Cowart, executive director of the Niagara Falls Housing Authority, which would lose nearly half of its $3.6 million subsidy, according to an analysis of spending data by two housing authority trade groups.
The proposed changes, several officials of housing authorities said, represented a turnabout from an agreement they believed they had made with the Housing and Urban Development Department last June. The administration has for several years advocated a new formula that would redistribute billions of housing dollars toward rural and southern areas and away from older urban areas in the Northeast and Midwest. Officials in those urban areas had negotiated a compromise they believed would minimize the cuts to their programs.
But last month, while Congress was in recess, the housing department began circulating a new proposal on Capitol Hill for far deeper cuts that bore little resemblance to that agreement, according to housing advocates and Congressional aides.
Instead, the housing agencies that were supposed to gain federal subsidies will gain much less, and those that lost money will lose much more.
