Housing factors in Trump budget proposal
(The National Lumber and Building Material Dealers Association released the following legislative update.)
President Donald Trump sent to Congress a $4.1 trillion budget proposal for Fiscal Year 2018, which begins on October 1. Titled "A New Foundation for American Greatness," the plan reduces discretionary spending by $1.5 trillion over 10 years and balances the federal budget in 2027. The proposal also assumes an overhaul of income tax rates.
Nondefense discretionary spending is cut over the next decade to decrease deficits and pay for increased defense spending. For FY 2018, funding for the Environmental Protection Agency (EPA) is decreased by 31 percent to $5.66 billion. Savings from Occupational Safety and Health Administration (OSHA) programs is a more modest 1.7 percent. Funding for the Department of Housing and Urban Development (HUD) is cut by 13 percent to $40.7 billion.
As part of the proposed cuts to EPA, enforcement for the Lead: Renovation, Repair, and Painting (RRP) program is defunded. Although the regulation would remain in effect, responsibility for enforcement would be the responsibility of each state. Currently, there are 14 states authorized to run their own RRP programs: Alabama, Delaware, Georgia, Iowa, Kansas, Massachusetts, Mississippi, North Carolina, Oklahoma, Oregon, Rhode Island, Utah, Washington, and Wisconsin.
OSHA is not spared from the cuts. The White House budget eliminates the entire $10.5 million for the Susan Harwood grant program, which funds nonprofit organizations that provide worker safety training programs. Although this program has existed since 1978, previous Republican administrations have sought to eliminate it as labor union safety programs have benefited.
The Trump Administration also proposes eliminating several HUD programs, including the HOME Investment Partnership (HOME) program that provides funding for activities such as building and rehabilitating affordable housing for rent and homeownership. HOME is receiving $950 million in funding for the current fiscal year.
An overhaul of the tax code is included in the White House budget. It reduces the number of personal income tax brackets from seven to three, lowers the business tax rate for both pass-throughs and corporations to 15 percent, and doubles the standard deduction.
Both the House and Senate Appropriations Committees have hearings scheduled this week to discuss President Trump's budget. Democrats are expected to push removing the budget caps on non-defense discretionary programs, which is set at $515 billion for FY 2018 as part of the Budget Control Act passed in 2011.
Looming over the budget negotiations is the need to raise the federal debt ceiling that sets a limit on the amount of money the government can borrow. On March 15, the debt ceiling was reached but the Department of Treasury is using extraordinary measures to meet the financial obligations of the federal government. However, by early fall, a contentious vote raising the debt ceiling will be needed to avoid a government default and it is likely to be a part of FY 2018 budget negotiations.