WASHINGTON – The Biden government's $ 6 trillion budget includes ambitious plans to increase funding for local financial development institutions, expand affordable housing, and establish a lower-income homeowner program and government-sponsored flood insurance policies.
Under President Biden's proposed 2022 budget, released on Friday, the Treasury, Department of Housing and Urban Development and Small Business Administration would benefit from double-digit or near double-digit fund increases. These proposals are a fundamental change from the Trump administration's proposed budgets, which have generally sought to cut government spending.
"The budget invests directly in the American people and will strengthen our nation's economy and improve our long-term budget health," Biden wrote in the preamble of the proposal to Congress. "It will help us build a recovery that is broad-based, inclusive, sustainable and strong."
"The budget invests directly in the American people and will strengthen our country's economy and improve our long-term budget health," wrote President Biden in the preamble of his 2022 budget proposal. "It will help us build a recovery that is broadly based, inclusive, sustainable and strong. "
The budget, which is more of a political document than a realistic picture of the level of funding, is primarily aimed at making progress in improving the supply and accessibility of affordable housing. Biden's budget is $ 2.8 billion over the next four years to incentivize zoning reform and $ 2 billion to provide additional grants and loans for rural housing over the same period.
Funding for the Capital Magnet Fund and the National Housing Trust Fund – two affordable housing programs currently supported by annual contributions from Fannie Mae and Freddie Mac – would also increase. Here, too, the proposal stands in sharp contrast to the philosophy of Trump, who repeatedly suggested that the funds be removed.
Biden also seeks to create an affordability program under the National Flood Insurance Program, which offers homeowners flood insurance in certain areas designated by the Federal Emergency Management Agency. Legislators have long proposed that such a program be put in place to cater to underserved borrowers in flood-prone areas.
Under the proposed budget, the Treasury Department would increase its core funding by just over 11%, from the $ 13.5 billion budget approved in 2021 to the proposed $ 15 billion budget for 2022. HUD would benefit from funding at the agency's program level even more, 15% from $ 59.6 billion to $ 68.7 billion.
And the Small Business Administration would see a more modest but still significant increase in administrative funding of 9.5% to $ 852.4 million. The assignment would support 2,100 full-time equivalent employees, who are equivalent to the 2021 fiscal year staff.
However, the request for SBA is perhaps more noteworthy for what is missing in the document, which is budgeted funding for COVID-19 relief programs that have dominated the agencies' operations for the past 14 months. Funding of the paycheck protection program, loans for catastrophe in the event of economic injury, as well as grant programs for restaurant revitalization and closed venue operators has ceased. In total, these programs received funding totaling $ 1.3 trillion in fiscal 2020 and 2021.
The SBA is applying for a total of $ 49.1 billion in funding agency for its standing programs: 7 (a), 504, Microloan and Small Business Investment Companies. This application is in line with the funding authority for the 2021 financial year.
"Today's budget, which includes America's employment and family plans, invests in both our infrastructure and our people to ensure that the post-pandemic chapter of our history is strong and successful," Treasury Secretary Janet Yellen said in a statement. "It is also important that this budget puts our country on a long-term, financially sustainable path through fair and efficient tax reform."
The democratic government continues to signal support for community finance organizations. The proposed budget includes a more than 22% increase in community development funding for financial institutions, requiring the Treasury Department's CDFI fund to increase from $ 270 million in FY 2021 to $ 330 million. The Trump administration has repeatedly called for funding for CDFIs to be cut.
The White House budget also includes an infusion of $ 3.8 billion into the HUD-run Community Development Block Grant program. The increase would include $ 295 million budgeted for "modernizing and refurbishing public infrastructure and facilities … in historically underfunded and marginalized communities with persistent poverty."
In a statement, HUD Secretary Marcia Fudge Biden applauded for putting housing at the center of his first household.
"The budget is a clear signal that HUD will no longer be on the sidelines as millions of Americans struggle with housing and are excluded from the opportunities that a good home offers," she said.
Staff writer John Reosti contributed to this article.