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Housing aid docked $27 million

WASHINGTON - American Indian housing aid from the federal government has
been cut by $27 million for fiscal year 2005, despite pervasive immediate
need and a growing population that will only put more pressure on a housing
infrastructure that is already the nation's worst.

The cuts, contained in the VA-HUD (Veterans Administration/ Department of
Housing and Urban Development) omnibus budget appropriations bill, have
passed both houses of Congress and a conference committee between the two.

The 2005 plan (the government's fiscal year 2005 started on Oct. 1) also
contains a devastating, though expected, cutting of amounts that would have
funded at least $500 million under two federal loans programs designed to
assist Indian housing.

The lone bright spot in the housing assistance landscape came recently when
Pres. Bush signed legislation that would restore the amount the federal
government is willing to guarantee on the Title VI loan program from 80
percent to 95 percent.

However, Title VI is a vastly underused program, (even originally when the
guarantee amount was 95 percent), so the effect of the restoration remains
to be seen.

The Native American Housing Assistance and Self-Determination Act block
grants, the biggest part of government housing assistance, have been
whittled back from $654 million to $627 million for 2005. This represents
the first substantial cut in NAHASDA money since 2000.

In addition, $54 million in guarantee money for the Title VI and HUD
section 184 loan programs, unused in previous years but still available to
be committed, has been rescinded. This money could have leveraged more than
half a billion in lending for Native housing projects or homes for
individual Indian families, scuttling a potential to build or finance
thousands of homes in Indian country.

Both programs have been funded for lesser amounts in the 2005 budget, and
HUD has said ample money remains to guarantee lending at current levels.

Kristy McCarthy Weight, outgoing governmental affairs director for the
National American Indian Housing Council, commented, "faced with a veto
from Pres. Bush, appropriators were forced to follow strict budget
limitations, with HUD taking heavy hits in most areas. Generally, the
omnibus contains final figures closer to the lower House proposals than
what were proposed in the Senate."

In addition, according to Weight, "all non-defense, non-security programs
are subjected to a 0.83 percent across the board cut." An additional
pressure in the HUD budget was an increase in Section 8 public housing
assistance, forcing other programs at HUD to take a hit.

A rider that would have returned the way housing assistance is allocated to
tribes prior to 2000, when the Census Bureau began allowing multiracial
identity choices, did not make it into the final bill, according to Weight.

Looking to the bright side, she commented that the appropriations bill was
passed much earlier this year than last, meaning access to the 2005 money
will be quicker than for 2003 and 2004.

Allocating money by the new, multi-racial method has taken money away from
tribes that have more people who identify themselves as Indian-only.

Total available for the NAHASDA formula distribution after set asides comes
to $615 million for 2005, down from $642.7 million in 2004. With the 0.83
percent mandatory haircut, that comes to just $610.5 million.

A proposed $9.5 million housing block grant for Native Hawaiians was zeroed
out in the final bill, according to a table NAIHC made available. The same
thing happened to a $10 million proposal the year before.

Native Hawaiians will, however, benefit from a $1 million HUD 184 set
aside. That's down slightly from $1.035 million appropriated in 2004.

After the NAHASDA housing block grant, the next biggest source of housing
money has been the Native set asides for Community Development Block
Grants. The ICDBG has been cut $3 million, from $72 million to $69 million.
CDBG money for Native Hawaiians has been reduced to $9 million, from $9.5
million.

One program that helps Indian housing was cut $1 million but would still
have to be counted as a success. HUD's RHED (Rural Housing and Economic
Development) program has been funded at $24 million, down from $25 million.
However, since the administration tried to zero it out for the third
straight year in 2005, RHED, which makes millions of dollars in yearly
awards in Indian country, has to be considered the little program that
could.

The U.S. Department of Agriculture Rural Housing Service loans, also used
extensively in Indian country, proved a mixed bag as some were increased
and some decreased. Direct government rural housing loans under section 502
were cut, but those loans made by lenders and guaranteed by the government
saw a funding increase.