Testimony: Federal Cuts Imperil New York City Housing

Testimony: Federal Cuts Imperil New York City Housing

Samuel Stein

Before the NYC Council Committee on General Welfare

Thank you to the New York City Council's Committee on General Welfare, the Committee on Governmental Operations, State & Federal Legislation, and the Committee on Hospitals for holding a hearing on the impact of federal funding cuts on New Yorkers. My name is Samuel Stein, and I am a senior policy analyst at the Community Service Society of New York (CSS), a nonprofit that promotes economic opportunity for all New Yorkers. CSS uses research, advocacy, and direct services to champion a more equitable city and state. Over the past 180 years, we have consistently fought for housing resources and rights for New Yorkers at the city, state, and federal levels, including the establishment of universal housing quality standards, the production of social housing, the enactment of rent regulations, and the expansion of rental assistance programs.

Let us be loud and clear: federal cuts to housing programs have already begun, and the Trump administration aims to make them much more severe. This is a red alert for New York City, where nearly a third of our budget comes either directly from the federal government or, more commonly, as pass-through funds from the state. While the city admirably supplants federal funding with local spending on housing programs, it is not enough. And while the proposed Congressional budgets are not as draconian as the Executive's proposal, they still represent a retreat from housing commitments. If the federal government ultimately follows through with the President's proposals, hundreds of thousands of households will lose their housing, leading to a homelessness crisis that would be orders of magnitude worse than the already-historic crisis we are currently facing. The Adams administration, the City Council, and every arm of city and state government must do everything in their powers to fight back against these extreme measures, to shore up our own programs, and to ensure housing stability for all New Yorkers.

The New York City Housing Authority (NYCHA) currently receives roughly $1.3 billion in annual funding for public housing, and NYCHA and the New York City Department of Housing Preservation and Development receive nearly $4 billion in Section 8 rental assistance. This funding was already too little, as demonstrated by the conditions crisis in public housing, the ballooning capital needs assessments, and the long waiting list for both public housing units and Section 8 vouchers. But with the cuts proposed by the President, even these paltry resources could be at risk, only to pay for a dystopian agenda of regressive taxation and mass deportation.

Already, the Trump administration has cancelled the Emergency Housing Voucher program five years early, leaving roughly 7,700 New York households-most of whom are formerly homeless-soon to be without federal rental assistance. It has also ended the Affirmatively Advancing Fair Housing rule and massively scaled-back all fair housing enforcement. The so-called "Department of Government Efficiency" (DOGE) has slashed several crucial programs operated by the Department of Housing and Urban Development (HUD), including an 84 percent reduction to HUD's Office of Community Planning and Development, which oversees the Continuum of Care, the HOME program, Community Development Block Grants, and disaster recovery efforts, and a 44 percent cut to HUD's Office of Housing, which oversees the Federal Housing Administration, multi-family housing finance, and the Rental Assistance Demonstration (RAD) program. Together, these cuts represent 1,900 layoffs of key personnel, jeopardizing HUD's ability to serve New York City and every municipality across the country. DOGE also clawed back grant-funded programs-including ones CSS would have participated in-for green retrofits to public housing, and cancelled grants to community development financial institutions and affordable housing developers such as Enterprise, LISC, and Habitat for Humanity, all in the guise of combatting diversity, equity, and inclusion.

If the President has his way, all this damage will only be the beginning. The Trump budget proposal would massively defund HUD, cutting 44 percent across the board and converting core programs like public housing and Section 8 to block grants. It would also impose a two-year time limit on public housing and rental assistance for working households, which NYCHA estimates would displace over 300,000 New Yorkers. The president also proposes eliminating the Community Development Block Grant program, which funds such core New York City housing functions as building code enforcement and many city planning initiatives, and jettisoning the Continuum of Care, which funds long-term supportive housing, rental assistance, and affordable housing production.

The New York Housing Conference estimates that this would result in a $4.7 billion reduction to New York City housing programs, putting not only tenants and homeless New Yorkers in jeopardy but also undermining nonprofit housing providers, commercial landlords, community development financial institutions, and commercial banks, all of whom rely on the long-term stability of housing funding. The City and its partners have invested over $10 billion in affordable housing deals that are tied to long-term HUD contracts. If Congress bows to the President's pressure and follows through on his threats, they will throw New York City into chaos.

In light of this precarious position, the Council is wise to advance the bills under review today. Intro 1364 (Restler) would ensure maximum transparency on the status of federal funding; Intro 1225 (Menin) would create an office to advance local participation in future censuses, which can enable greater representation and funding in future electoral and budget cycles; and Intro 1372 (Ayala) would end the unnecessary hardship of a 40 percent rent contribution for certain households using CityFHEPS vouchers.

Passing these bills must only be the first step. The city and state must protect and expand existing local programs so that they can continue to help house the homeless and ensure tenants remain housed. CityFHEPS, for example, currently houses 47,000 households, and the Council has approved an expansion of the program-though the administration continues to refuse to enact it. The administration must drop its opposition and expand this crucial resource. We must also consider new ways to grow state and local revenues in order to ensure that all New Yorkers are housed securely. Ultimately, we all must do everything in our power to stop Congress from enacting the President's proposed budget.

We cannot sink our heads in the sand, ignore the warning signs all around us, and hope for the best. We must act now to avert tragedy and save the programs that make our city what it is.

Thank you for your time and attention. If you have any questions about our testimony or CSS's research, please contact me at [email protected].

Issues Covered

Affordable Housing

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