Phil Mendelson sits in a chair in front of a brown curtain in the D.C. Council chambers.
DC Council Chair Phil Mendelson leads the vote on the draft budget.

The D.C. Council last week gave initial approval to the city’s budget for the next fiscal year, providing funding for some new housing vouchers sought by advocates but far fewer than they recommended. 

The council’s version of the fiscal year 2023 budget added funding for 400 Targeted Affordable Housing (TAH) vouchers for families exiting Rapid Rehousing (RRH). The budget, which passed unanimously May 10, also expands D.C.’s earned income tax credit (EITC) to undocumented workers and increases funding to District public schools that have a high number of at-risk students. 

The Local Budget Act, which allocates the funding, will have a second vote May 24. The Budget Support Act, which consists of the legal language necessary to implement the financial plan, will have a second vote in early June. Mayor Muriel Bowser will then decide whether to sign the final budget, which would then go to Congress for review.

Here’s what’s funded and unfunded in the latest iteration of the draft budget:

New investments

The budget process began in March when Bowser released her $19.5 billion budget proposal. Over the last month, council committees offered their own input on the budget, shuffling some funding to provide modest increases to eviction prevention, homeless services, public housing and voucher budgets. DC Council Chair Phil Mendelson then presented a final draft, which included most of those recommendations and made some further revisions.

Funding for families exiting Rapid Rehousing

Mendelson’s draft included an additional 380 TAH vouchers that are designated for families exiting RRH, which provides a short-term housing subsidy for families experiencing homelessness. The Committee on Human Services funded 20 TAH vouchers, which provide a permanent housing subsidy, to help some of the 913 families set to be terminated from the RRH program in September of this year. An additional $13.6 million in Mendelson’s draft and approved by the council brings the total to 400, though housing advocates have pushed for enough vouchers to cover all 913 families.

Families who have been in the program the longest will be given priority. 

“This does not meet the full need, but it does highlight the urgency with which we must reform Rapid Rehousing,” At-large Councilmember Robert White said during the budget deliberations. “This program is not working.” 

Mendelson also referenced wanting to more comprehensively reform RRH, but said he was not able to get approval from the Office of the Chief Financial Officer because of the fiscal impact.  

Funding for excluded workers

Councilmembers also allocated just under $4 million to make the city’s EITC available to undocumented immigrants, who were not eligible for federal stimulus checks and unemployment benefits sent out in 2020 and 2021. Last year, a coalition of excluded workers asked for $200 million in aid from the D.C. government and received just $41 million. This year, they asked for the remaining $160 million. 

According to the D.C. Fiscal Policy Institute (DCFPI), 5,000 households have at least one family member who is undocumented, which currently makes them ineligible for the D.C. tax credit. This expansion would enable any of those households earning less than $53,000 to receive an average of $300 a month, according to a statement from Ward 6 Councilmember Charles Allen. Still, several councilmembers have signaled they’d like to see more money in the budget to provide retroactive benefits for excluded workers. 

“We know that the negative impacts of the pandemic continue to be felt by a much larger community of excluded workers than those that would qualify for the EITC,” Ward 1 Councilmember Brianne Nadeau said. “And while we cannot make these families whole, any assistance would help to ensure they’re on a path to recover.”

Funding for at-risk students 

Another substantial change made by Mendelson increases the funding for at-risk students in DC Public Schools (DCPS) and the public charter schools. Students are classified as “at-risk” if they are experiencing homelessness, in foster care, qualify for Temporary Assistance for Needy Families or the Supplemental Nutrition Assistance Program, or are a year behind in school. While DCPS and charter schools already receive additional funding for students who are at-risk through a funding formula, a 2019 D.C. auditor’s report found that some of the DCPS funding was being used to fill budget gaps, not to provide additional resources to students. 

In an attempt to avoid repeating this problem, the new funding will go directly to schools, rather than to the central administration for distribution. Schools where at least 40% of students are at risk will get an increase of 0.05 to a school’s funding weight, with a 0.1 increase for schools where over 70% of students are at-risk. The increase will cost just over $10 million annually, with the money split between DCPS and D.C. charter schools. 

Mendelson’s smaller increases

The budget approved by the D.C. Council also includes several new allocations for housing and homeless services. Joseph’s House, an Adams Morgan nonprofit that offers nursing and support to people experiencing homelessness with advanced HIV and cancer, is set to receive a $250,000 grant. The budget also includes $1.3 million for the D.C. Housing Authority (DCHA) to assist an additional 175 participants in the Shallow Subsidy for Unsubsidized Seniors Program. The program provides up to $600 a month to seniors who don’t receive any other housing support and make less than 60% of the area median income. 

“Seniors have an especially difficult time staying in the District, and this increase will help more seniors stay here,” Councilmember Robert White said. 

The money to fund these increases came from a variety of sources, most notably a $54 million reduction from the mayor’s proposed $500 million investment in the Housing Production Trust Fund (HPTF). The HPTF, which is supposed to fund the creation of affordable housing in D.C., has not met the affordability targets set by the DC Council, leading some advocates to argue that providing vouchers and subsidies like TAH is a more effective way to end homelessness. 

What made it in

Bowser’s budget submission and the subsequent committee recommendations included several notable investments in housing and anti-poverty programs that remained in Mendelson’s draft, putting them on the path to final adoption. Some of the largest ones include: 

Vouchers: 

  • 770 new Permanent Supportive Housing (PSH) vouchers for 500 families, 260 individuals and 10 youth, costing a total of $31 million. PSH vouchers provide housing to people who have experienced chronic homelessness. 
  • An increase of $5 million in FY 2023 for new project-sponsored Local Rent Subsidy Program (LRSP) vouchers, administered through housing providers and nonprofits.  
  • A total of $75 million for the RRH program, similar to the amount spent this year.
  • $750,000 to D.C.’s Department of Human Services to provide technical assistance grants to nonprofits that provide emergency housing and intervention for survivors of domestic violence. 

 

Shelters: 

  • An increase of $1.7 million for shelter diversion programs for singles and families. 
  • $114 million of capital funding over fiscal years 2023 and 2024 to modernize and renovate D.C.’s shelter system. 
  • $2 million to fund property tax exemptions and retroactive debt forgiveness for the Conway Center, an affordable housing property run by So Others Might Eat; two affordable housing properties owned by Habitat for Humanity; and the downtown shelter operated by the Community for Creative Non-Violence. 

 

Affordable and public housing: 

  • $446 million to the HPTF to create more affordable housing in the District. 
  • $219 million to continue the redevelopment of public housing units at Barry Farm, Park Morton, Bruce Monroe and Northwest One, all part of the New Communities Initiative. 
  • $40,000 to allow D.C.’s Department of Housing and Community Development (DHCD) to track subsidized affordable housing.
  • A subtitle increasing the council’s oversight of the HPTF by requiring DHCD to request a waiver if the agency cannot meet statutory requirements because of a lack of development proposals with deeply affordable units. The agency would also have to notify the council when projects are funded and submit a written report including data on affordable units and the rationale for project selections. 

 

Employment: 

  • $606,000 for the second year of the Jobs First pilot program, which will help qualified D.C. residents find employment quickly through grants to Friendship Place and Byte Back, the groups selected in a recent Department of Employment Services solicitation. 
  • A subtitle moving $113 million of this year’s surplus to the Unemployment Fund, which funds local unemployment insurance. According to the council’s budget report, this is needed to make sure the fund has enough money to support all people who might need unemployment benefits. 

 

What stayed out 

DCFPI and the Fair Budget Coalition led other housing advocates in pushing for additional spending on housing programs that, as of now, are still unfunded or partially funded. Before the second vote on the budget, councilmembers will have the opportunity to add money for any of these programs, as long as they identify a funding source to keep the budget balanced. Programs at issue include the following: 

LRSP vouchers: The current budget funds 60 new LRSP tenant-based vouchers to subsidize rent for 20 LGBTQ+ individuals, 20 returning citizens, and 20 families on D.C.’s 37,000-person voucher waitlist. Given the size of the waitlist, advocates are asking for $17.33 million for a total of 800 new vouchers

TAH and RRH: The current budget allocates $75 million for RRH plus approximately $14 million for 400 new TAH vouchers for people exiting RRH this year. However, this falls short of the advocates’ demand on both counts: enough money for all families exiting RRH to have permanent housing support, and a separate $27.7 million for TAH vouchers to serve 1,040 families.

Rental Assistance: The Emergency Rental Assistance Program, which provides money for residents facing eviction because of unpaid rent, sees an increase of $120.3 million in the budget. Advocates are calling on the city to fund the full $187 million that Bowser estimated last fall was needed to help households at risk of eviction. 

Public housing: The cost to fully repair all public housing in D.C. is $2.2 billion, according to a 2019 estimate by the DCHA director at the time. Based on these numbers, advocates have pushed for repairs to be funded at $60 million each year for the next decade. The current funding level is a total of $111.1 million over the next three years, falling about $70 million short. 

Homelessness services: Worried about potential service cuts, homeless advocates are calling for funding to ensure that all existing non-congregate shelters are maintained for the remainder of the pandemic and that all shelters have 24-hour access. There is no money for these policies in the budget. 

Youth employment: Criticizing current options as inadequate, housing advocates are calling for the establishment of a new workforce program for youth experiencing homelessness. They’re asking for $1 million; so far no money has gone toward the program. 

This article was co-published with The DC Line.

Annemarie Cuccia covers DC government and public affairs through a partnership between Street Sense Media and The DC Line. This joint position was made possible by The Nash Foundation and individual contributors.