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[Senate Report 110-216]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 463
110th Congress                                                   Report
                                 SENATE
 1st Session                                                    110-216

======================================================================

 
         COMMUNITY PARTNERSHIP TO END HOMELESSNESS ACT OF 2007

                                _______
                                

                November 1, 2007.--Ordered to be printed

                                _______
                                

  Mr. Dodd, from the Committee on Banking, Housing and Urban Affairs, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 1518]

    The Committee on Banking, Housing, and Urban Affairs, 
having had under consideration the bill (S. 1518) to amend the 
McKinney-Vento Homeless Assistance Act to reauthorize the Act, 
and for other purposes, having considered the same, reports 
favorably thereon with an amendment and recommends that the 
bill (as amended) do pass.

                              INTRODUCTION

    On September 19, 2007, the Senate Committee on Banking, 
Housing, and Urban Affairs considered S. 1518, ``The Community 
Partnership to End Homelessness Act of 2007,'' to amend the 
McKinney-Vento Homeless Assistance Act to reauthorize the Act, 
and for other purposes. The Committee voted unanimously to 
report the bill (S. 1518) as amended to the Senate.

                               BACKGROUND

    In 1986, in response to the rapid and dramatic growth of 
homelessness in the United States in the 1980s, Congress passed 
the Homeless Housing Act, which created the Emergency Shelter 
Grants (ESG) program and the Transitional Housing Demonstration 
program. The Urgent Relief for the Homeless Assistance Act was 
enacted in July 1987. It was later renamed the Stewart B. 
McKinney Homelessness Act and renamed again the McKinney-Vento 
Homeless Assistance Act. The McKinney-Vento Act originally 
contained 15 programs addressing different aspects of 
homelessness, including emergency shelter, transitional 
housing, permanent housing, education, job training, and 
primary health needs. The Act was amended several times over 
the next seven years, adding, among other things, the Shelter 
Plus Care (S+C) program and the Rural Homeless Housing 
Assistance Program. Today, the McKinney-Vento Homeless 
Assistance Act is the primary federal program to support 
communities in their efforts to address and reduce 
homelessness.
    The housing subtitles of McKinney-Vento were last 
authorized in 1992 (P.L. 102-550) through fiscal year 1994. 
Prior to 1995, Congress separately funded the housing programs 
for those who were homeless. For fiscal year 1995, the 
Appropriations bills consolidated the funding accounts for the 
ESG program, the S+C program, the Supportive Housing Program 
(SHP), and the Section 8 Moderate Rehabilitation for Single 
Room Occupancy Dwellings (SRO) program, and HUD encouraged 
communities to submit a single application for funding. The 
purpose of this single application was not only to streamline 
the application process, but also to encourage providers to 
coordinate their projects and on an overall strategy for the 
community. This process became known as the Continuum of Care. 
The Continuum of Care process enables communities to apply for 
funds from one of three programs: S+C, SHP, and SRO. The amount 
of funding a community receives is based on a needs-based 
formula and on the quality of the application. In addition to 
this award-winning competitive grant program, Emergency Shelter 
Grants are provided by formula to cities, counties, and states.
    In addition to the changes to the application process that 
HUD initiated in 1995, research on the effectiveness of 
particular strategies has led to significant policy shifts in 
McKinney-Vento programs. In the 1990's, research conducted in 
Philadelphia and New York City found that a small group of 
homeless adults--about 20 percent of the total homeless 
population stayed homeless for long periods of time or cycled 
in and out of hospitals, jails, or other institutions; had high 
rates of disabilities; and utilized a disproportionate share of 
the homeless assistance resources. Further research in New York 
City found that moving this group of chronically homeless 
adults into permanent supportive housing--housing with 
intensive supportive services attached--not only ended their 
homelessness, but was also cost effective, as it dramatically 
reduced the costs to public systems. Subsequent studies have 
supported these findings, and have concluded that the net cost 
of providing permanent supportive housing is even less than the 
cost of allowing chronically homeless people to remain 
homeless.
    Based on these findings, Congress and HUD initiated efforts 
to create more permanent supportive housing to end chronic 
homelessness. The bipartisan Millennial Housing Commission and 
the New Freedom Commission on Mental Health estimated that 
approximately 150,000 new units of permanent supportive housing 
were needed to achieve this goal. Beginning in fiscal year 
1999, Congress steadily increased appropriations for McKinney-
Vento housing programs and targeted much of the increase 
towards efforts to end chronic homelessness. These efforts were 
supplemented by numerous state and locally driven initiatives. 
As a result, several cities have reported significant 
reductions in the number of people who are chronically homeless 
and the number of people who live on the streets or in places 
not meant for human habitation.
    While chronic homelessness was receiving much of the 
attention in the early part of this decade, several cities were 
using a new approach to address family homelessness that 
focused on rapid rehousing of homeless families. These 
communities have programs that work with families to quickly 
identify and help them move into permanent housing and provide 
short-term rental assistance, assistance with other housing 
costs, and follow-up services to help families achieve long 
term housing stability and self-sufficiency. This strategy has 
led to significant declines in homelessness among families in 
several communities, most notably in Hennepin County, 
Minnesota, where the average nightly census in the homeless 
shelter declined by almost two-thirds.
    Over the last several years, there have been a number of 
other developments in serving homeless people, most notably a 
focus on the importance of acquiring data. In early 2000, 
Congress required HUD to work with communities to develop 
homeless management information systems (HMIS) to assess the 
number of homeless people, how those who are homeless interact 
with the homeless system, and which programs are effective for 
preventing or ending homelessness. Communities are in various 
stages of implementation of HMIS--many have functional systems 
while others are in still in the developmental stages. As a 
result of HMIS and other data collection efforts, we now have 
estimates of the number of homeless people that are based on 
actual counts.
    Beginning in 2001, communities began developing 10-year 
plans to end homelessness. These plans, encouraged by HUD, 
brought together nonprofit providers, advocates, the business 
and faith-based communities, and city and local government 
officials to design strategies for preventing and ending 
homelessness. More than 200 plans have been completed to date, 
and dozens more are in the process of being completed. The 
purpose of these plans is to identify and implement the most 
efficient and effective strategies for preventing and ending 
homelessness in the community using the best available data.
    Based on the best available statistics, the actual count of 
the homeless, approximately 750,000 people are homeless at a 
given point in time. 41 percent (300,000) are members of 
families with children and many--about 44 percent--are 
unsheltered, living on the streets, in abandoned buildings, or 
in other places not meant for human habitation. Nearly 200,000 
are veterans, approximately 170,000 are chronically homeless--
spending long periods of time homeless or cycling between 
housing, homelessness and other institutional care, such as 
psychiatric hospitals and corrections. Over the course of a 
year, as many as 3.5 million people--approximately 10 percent 
of people in poverty--experience homelessness.

                       PURPOSE OF THE LEGISLATION

    This legislation is designed to help communities end 
homelessness. It makes several improvements to the HUD homeless 
assistance programs to simplify and focus them more on cost-
effectively preventing and ending homelessness. Several 
separate programs are eliminated or consolidated into a single 
Community Homeless Assistance Program. Different match 
requirements for the formerly separate programs are unified 
into a single 25 percent match requirement. Incentives are 
included to promote strategies that have been proven to prevent 
and end homelessness and communities are rewarded for 
demonstrating progress.
    The restructured Emergency Solutions Grant program would 
increase the role of city and state governments in preventing 
and ending homelessness and would ensure that more resources 
are used for preventing homelessness.
    The Committee recognizes that homeless assistance systems 
in rural areas function differently than those in urban areas. 
Urban areas are more likely to have systems that include 
emergency shelters and other homelessness infrastructure. Rural 
homeless assistance programs are more likely to be integrated 
with other mainstream safety net programs. The legislation 
would give rural applicants the option of applying for a 
specially designed rural program that focuses much more on 
prevention and is easier to integrate with existing systems. 
The legislation also simplifies the application process for 
rural programs.
    The legislation continues the strategies that have worked 
toward ending chronic homelessness while encouraging preventing 
and ending homelessness for families with children. It adds 
families with children to the definition of chronic 
homelessness and it requires that HUD provide incentives for 
rapid rehousing strategies that serve homeless families. It 
provides resources to prevent homelessness for families that 
are doubled up, living in hotels, or in other precarious 
housing situations. It expands the definition of homelessness 
to include people who are forced to move frequently between the 
homes of friends and family because they do not have adequate 
resources.
    The legislation provides greater flexibility and includes 
several features to encourage better performance. In addition 
to including explicit performance-based criteria in the 
application process, the legislation directs HUD to provide 
incentives for permanent supportive housing for chronically 
homeless individuals and families and rapid rehousing programs 
for homeless families. Both of these strategies have been 
proven to reduce homelessness and should be expanded. The 
legislation also rewards communities that demonstrably reduce 
homelessness by providing them with additional flexibility in 
how they use their funds. This flexibility can continue for as 
long as the community makes progress. The legislation continues 
the Appropriation's Committee's longstanding support for 
ensuring that at least 30 percent of funding be used for 
permanent housing for people with disabilities. It also ensures 
that permanent housing programs can be renewed without reducing 
resources for other priorities.
    The legislation includes a provision that allows a 
collaborative applicant to be a unified funding agency. This 
would allow HUD to provide funding for a community to one 
agency which would distribute funds to local homeless 
assistance providers. Unified funding agencies would take on 
many of the oversight responsibilities that are now performed 
by HUD. Applicants could apply to be a unified funding agency 
or HUD could, under certain conditions, designate an applicant 
as a unified funding agency. HUD could make this designation 
only when applicants clearly have the capacity to perform the 
functions required, when there is a demonstrable benefit to the 
community, and when HUD and the applicant have agreed on the 
amount of technical assistance that will be provided to the 
applicant to help them perform their required duties.
    The legislation outlines a simple application process that 
will reduce the amount of time and energy communities spend on 
applying for funds and increase the amount of resources they 
spend perfecting strategies that prevent and end homelessness. 
The process for rural applicants is even simpler and recognizes 
the unique characteristics of rural homeless assistance. The 
legislation also utilizes selection criteria that are based on 
ten-year plans that communities are creating to end 
homelessness. Communities will be able to integrate their ten-
year plans with their homeless assistance applications.

Housing and services demonstration project

    The Committee has authorized funds for the Secretary to 
conduct research on the effectiveness of varying levels of 
housing and services support for homeless families. There is an 
extensive homeless assistance system available to families who 
experience homelessness. This system is made up of emergency 
shelters, transitional housing, and a small number of permanent 
supportive housing units; many of these housing models are 
accompanied by services and supports aimed at helping families 
exit homelessness and make improvement in their lives. Homeless 
families are also eligible for mainstream housing and services 
such as housing vouchers and homeless prevention assistance. 
One of the biggest challenges this demonstration is designed to 
address is identifying which housing and service models lead to 
housing stability and are most cost-effective.

Evaluation

    Research on chronic homelessness has provided a series of 
robust findings that have led to policy changes that benefit 
chronically homeless single adults. Additional research on 
effective solutions to family homelessness is needed to fill in 
gaps in knowledge and identify cost-effective solutions that 
end homelessness for families.

Multi-site random control experiment

    The Committee directs HUD to select and evaluate a limited 
number of sites as a part of the Homeless Assistance Grants 
competition. This evaluation should include a multi-site study 
experimental design (randomly controlled assignment) that 
compares and contrasts different housing models focusing on 
shallow and short term subsidies, housing vouchers (linked with 
voluntary community-based services or the family self-
sufficiency program (FSS)), and transitional housing (with 
mandatory services). The evaluation should be funded for three 
years and extended if funds are available. The evaluation 
should be conducted by an independent contractor and awarded on 
a competitive basis with points awarded for proven experience 
conducting random assignment experiments for the social 
sciences; knowledge of family homelessness; and capacity to 
implement random assignment and track homeless families over 
time. The evaluators should create a council made up of policy 
experts and practitioners to provide advice on the development 
of the research design and implementation of the program.

Review of assessment tools and targeting efforts

    Research by Dr. Dennis Culhane of the University of 
Pennsylvania indicates that homeless families have varying 
levels of need for housing subsidies and services. This means 
that homeless service providers must assess families and target 
services based on their needs. The Committee has authorized 
funds for a qualitative review of tools that assess low-income 
families' level of need and use this data to target the 
appropriate level of services. This study should identify 
``promising tools'' and make recommendations on how to develop 
more sophisticated targeting. The study should include six to 
eight sites, be conducted by an independent contractor, and be 
awarded on a competitive basis.

Prevention study

    A critical component of ending homelessness is preventing 
it from occurring in the first place. However, little is known 
about what characteristics distinguish those poor, at-risk 
families who become homeless, particularly those who have 
repeated or long episodes of homelessness from those who do 
not. The Committee has authorized funds for the Secretary to 
launch a family homeless prevention study. This prospective 
cohort study should include a longitudinal survey that tracks 
at-risk families over five years.
    On several occasions, HUD has made significant policy 
changes in its implementation of the McKinney-Vento Act through 
its Notice of Funding Availability (NOFA) process. It is the 
intent of the Committee that HUD implement both the existing 
provisions of McKinney-Vento and those of this bill through 
formal rulemaking procedures.

                                HEARINGS

    The Committee heard testimony in the 110th Congress on June 
21, 2007 regarding reauthorization of the McKinney-Vento 
Homeless Assistance Act. Witnesses testifying were the 
Honorable Adrian Fenty, Mayor of the District of Columbia, the 
Honorable Shirley Franklin, Mayor of Atlanta, Georgia, the 
Honorable Roy Bernardi, Deputy Secretary of the Department of 
Housing and Urban Development, Ms. Linda Glassman, National 
AIDS Housing Coalition, Ms. Carol Gundlach, Alabama Coalition 
Against Domestic Violence, Mr. Moises Loza, Housing Assistance 
Council, Mr. Lloyd Pendleton, State of Utah Division of Housing 
and Community Development, and Ms. Nan Roman, National Alliance 
to End Homelessness.
    The Committee had previously heard testimony in the 109th 
Congress on March 30, 2006 regarding reauthorization of the 
McKinney-Vento Homeless Assistance Act and Consolidation of 
HUD's Homeless Assistance Programs. Witnesses testifying were 
the Honorable Roy Bernardi, Deputy Secretary of the Department 
of Housing and Urban Development, Mr. Philip Mangano, Executive 
Director of the U.S. Interagency Council on Homelessness, Ms. 
Gail Dorfman, County Commissioner, Hennepin County, Minnesota, 
Mr. Steve Berg, National Alliance to End Homelessness, Mr. 
Charles Gould, Volunteers of America, Mr. Anthony Love, Houston 
Coalition for the Homeless, and Dr. Dennis Culhane, University 
of Pennsylvania.

                      SECTION-BY-SECTION ANALYSIS

Section 1. Short title; table of contents

    This section contains the table of contents and the short 
title of the bill, ``Community Partnership to End Homelessness 
Act of 2007.''

Section 2. Findings and purpose

    This section contains the findings and purpose. These 
findings include that homelessness is a crisis of people who 
lack basic affordable housing and appropriate shelter; that 
homeless assistance has had a positive effect, and should 
continue to be evaluated based on how well it reduces 
homelessness. The purposes are to create a unified, 
performance-based process for funding; to encourage 
collaboration and planning; to focus the public and private 
sector on ending and preventing homelessness; to assist 
homeless people; to consolidate programs; to allow flexibility; 
and to involve other Federal agencies in ending homelessness.

Section 3. General definition of homeless individual

    This section modifies the current definition of 
homelessness to include people who are staying for a short time 
in the housing of others or a hotel, and have moved frequently.

Section 4. United States Interagency Council on Homelessness

    This section makes adjustments to the role and operation of 
the Interagency Council, including changes to the mission 
statement, adding new members, increasing meeting frequency, 
and increasing the number of regional coordinators. The council 
will be overseen by the chair and will develop a national 
strategic plan to end homelessness and to encourage state and 
local governments to develop 10-year plans to end homelessness. 
The authorization level for the council is $3 million.

Section 5. Housing assistance general provisions

    This section includes new provisions as follows. Section 
401 defines terms including at-risk of homelessness, chronic 
homelessness, operating cost, and other terms. Section 402 
establishes collaborative applicants, which are responsible for 
designing a collaborative process for applying for funding and 
ensuring participation in homeless management information 
systems. Collaborative applicants may also become unified 
funding agencies, which would give them responsibility for 
distributing funds to grantees and ensuring proper accounting 
methods.
    Section 404 prevents discrimination against older children 
in programs serving homeless families. Section 405 authorizes 
technical assistance to grantees and collaborative applicants. 
Section 406 creates an appeals process. Section 408 authorizes 
$2.2 billion for fiscal year 2008 and such sums as may be 
necessary for fiscal years 2009 through 2012.

Section 6. Emergency Solutions Grants Program

    This section modifies the existing Emergency Shelter Grants 
(ESG) program and renames it the Emergency Solutions Grants 
Program. This section mandates that 20 percent of homeless 
assistance funding be used for the Emergency Solutions Grants 
Program, with no more than 60 percent of that amount being used 
for traditional shelter and street outreach activities, and at 
least 40 percent being for homelessness prevention and 
rehousing. It is the intent of the Committee that communities 
not be forced to stop funding existing emergency shelter 
programs as a result of this transition, but that this cap on 
funding for shelters be met over time. New activities are added 
to eligible uses, including short- or medium-term rent 
assistance and new homelessness prevention and housing 
relocation and stabilization activities. This section requires 
recipients of Emergency Solutions Grants funds to participate 
in the applicable homeless management information system.

Section 7. Homeless Assistance Program

    This section consolidates several existing programs into 
the Community Homeless Assistance Program.
    Section 421 identifies the purpose of the program as 
promoting commitment to ending homelessness, rehousing homeless 
people, minimizing the trauma of homelessness, helping people 
access mainstream services, and optimizing self-sufficiency. 
Section 422 requires that the notice of funding availability be 
released within three months of enactment, that awards be 
announced within five months of when applications are due 
(within six months for the first two years after enactment), 
and that project sponsors meet the applicable requirements for 
obligation within nine months of an award or for projects 
involving development, within 24 months of an award.
    Section 422 also describes procedures for when there are 
multiple applicants from a geographic area. Section 422 adjusts 
renewal funding for permanent housing projects for increases in 
housing costs. Also, providers whose primary mission is to 
serve victims of domestic violence, dating violence, sexual 
assault, or stalking would not provide personally identifying 
information to a homeless management information system.
    Section 423 lists the eligible activities of the Community 
Homeless Assistance Program, including acquisition, 
construction, rehabilitation, leasing, rental assistance, 
operating costs, supportive services, rehousing services, 
homeless management information systems, and administrative 
costs. Projects receiving funding for construction, acquisition 
or rehabilitation must be used for their intended purpose for 
at least 15 years. If a project is no longer needed for that 
purpose, it can be converted to directly benefit low-income 
people. If a project is needed and is not used to serve 
homeless people for 15 years, then, except under certain 
conditions, the grantee will be required to repay all or a 
portion of the grant.
    Section 424 creates a flexibility incentive for high-
performing communities. If a community successfully reduces 
homelessness, they can be granted additional flexibility with 
their funding, and would be required to share best practices 
with HUD and other communities.
    Section 426 would require grantees to gain site control 
within 12 months of notification of an award, ensure that 
homeless people are involved in projects, maintain 
confidentiality of records, maintain confidentiality of the 
location of family violence shelters, ensure that grantees do 
no restrict the educational rights of homeless children, 
provide required data to HUD, and ensure that projects serving 
people with disabilities do not concentrate and isolate people 
with disabilities.
    Section 427 sets the selection criteria for the Community 
Homeless Assistance Program. Criteria include past success at 
preventing and reducing homelessness and increasing jobs and 
income growth, plans to reduce homelessness for all 
subpopulations of homeless people, whether the opinions of all 
relevant parties are considered, leveraging, and coordination. 
In addition to those factors, Section 427 establishes a need 
formula for each geographic area, which would be determined by 
HUD for the first two years after enactment, and then would be 
established by HUD based on the number of homeless people, 
shortages of affordable housing, severe housing problems among 
extremely low-income households, and the poverty rate. Section 
427 also requires HUD to adjust a community's pro-rata need to 
ensure enough funding to provide 1 year of renewal funding for 
all expiring contracts.
    Section 428 sets allocation amounts and incentives for 
specific eligible activities. At least 30 percent of funding is 
for new permanent housing for people with disabilities. The 
calculation for this 30 percent applies nationally, not to each 
individual community. The 30 percent figure is reduced 
proportionately for communities that have developed enough 
permanent housing for all of the chronically homeless people in 
their geographic area and is waived if there is not enough 
funding to cover one year of renewals for existing projects. 
The 30 percent requirement is terminate when HUD determines 
that 150,000 new units of permanent housing for homeless people 
with disabilities has been funded since 2001. Section 428 
requires that at least 10 percent of funding must be used to 
permanently house families with children. Section 428 requires 
HUD to fund interventions that are proven to be effective, 
including permanent supportive housing for chronically homeless 
individuals and families and rapid rehousing programs for 
homeless families. Any community that fully implements a proven 
strategy could use their bonus for any eligible activity, 
including homelessness prevention.
    Section 429 funds renewals of permanent rental assistance 
or permanent housing operating costs to be funded for one year 
at a time out of the funding account for Section 8 housing, 
provided that there is a demonstrated need and the project 
complies with appropriate standards.
    Section 430 establishes a uniform 25 percent match that can 
be met with cash or, when documented by a memorandum of 
understanding, in-kind services. Projects that previously had 
no match requirement could continue to be renewed without a 
match requirement. The match requirement applies community-
wide, not necessarily project by project.

Section 8. Rural Housing Stability Assistance Program

    This section modifies Section 491 of the McKinney-Vento 
Homeless Assistance Act, the Rural Homeless Assistance Program, 
and changes the title to the Rural Housing Stability Assistance 
Program. This section modifies section 491(a) by making the 
purpose of the program to rehouse or find housing for people 
who are homeless or in the worst housing situations, stabilize 
people in imminent danger of losing their housing, and improve 
the ability of the lowest income residents to afford stable 
housing. This program is to be carried out separately from the 
overall Community Homeless Assistance Program competition.
    Section 491(b) is modified by adding to the list of 
eligible activities construction, acquisition, rehabilitation, 
leasing, rental assistance, and operating costs for 
transitional or permanent housing for homeless people.
    Section 491(d) is modified by adding to the application 
requirements a description of consultations to determine the 
most important uses of funding and a description of the nature 
of homelessness and the worst housing situations in the area.
    Section 491(f) is modified so that there is a uniform 25 
percent match requirement for all activities except that 
projects that previously had no match requirement could 
continue to be renewed without a match requirement. The match 
can be met with cash or, when documented by a memorandum of 
understanding, in-kind services.
    The selection criteria in Section 491(g) are replaced by 
participation of potential beneficiaries, the degree to which 
the project addresses the most harmful housing conditions, 
collaboration, performance in improving housing situations, 
past performance, need, and other HUD- determined criteria.
    Section 491(j) defines a rural area as any place outside of 
a metropolitan statistical area or any census tract within a 
metropolitan statistical area that is at least 75 percent 
rural. Any state that has fewer than 30 people per square mile 
and of which more than 1.25 percent of land is under the 
control of the federal government is considered rural in its 
entirety except if the applicant consists solely of a 
metropolitan city.
    Section 491(k) describes the funding process for the rural 
program. A rural applicant could choose to apply under the 
Community Homeless Assistance Program or the Rural Housing 
Stability Program. Funding is based on the selection criteria 
and on pro-rata need.
    Section 491(l) requires that if more than one entity from a 
rural area applies for funding, HUD must first seek agreement 
from the applicants about how to proceed and if there is no 
agreement, HUD must fund the application that would result in 
the most funding for the geographic area.

Section 9. Research

    For fiscal years 2009, 2010, and 2011, $8,000,000 is 
authorized to research the efficacy of interventions for 
homeless families to study three different sites over three 
years to evaluate the effectiveness of those programs.

Section 10. Repeals and conforming amendments

    This section repeals Subtitles D (Safe Havens for Homeless 
Individuals Demonstration Program), E (Miscellaneous Program), 
and F (Shelter Plus Care), of the McKinney Vento Homeless 
Assistance Act. These programs are replaced by the programs 
described in Section 7.

Section 11. Special Assistant for Veterans Affairs in Office of 
        Secretary of Housing and Urban Development

    A new Special Assistant for Veterans Affairs is established 
within HUD. The Special Assistant would be appointed based 
solely on merit and would ensure that veterans have access to 
HUD housing and homeless assistance, coordinate all activities 
related to veterans, and serve as a liaison with the Department 
of Veterans Affairs.

Section 12. Effective date

    This section makes this Act effective 6 months after 
enactment.

                          COST OF LEGISLATION

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 9, 2007.
Hon. Christopher J. Dodd,
Chairman, Committee on Banking, Housing, and Urban Affairs, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 1518, the Community 
Partnership to End Homelessness Act of 2007.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Chad Chirico.
            Sincerely,
                                                   Peter R. Orszag.

Community Parternship to End Homelessness Act of 2007

    S. 1518 would reauthorize the McKinney-Vento Homeless 
Assistance Act for five years and consolidate the act's 
separate competitive grant programs for assistance to the 
homeless into a single program. CBO estimates that implementing 
this legislation would cost about $7.7 billion over the next 
five years, assuming the appropriation of the necessary 
amounts. The Joint Committee on Taxation (JCT) estimates that 
enacting S. 1518 would reduce revenues by $7 million over the 
2008-2012 period and by $22 million over the next 10 years.
    S. 1518 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA); 
any costs to state, local, or tribal governments would be 
incurred voluntarily.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 1518 is shown in Table 1. The costs of 
this legislation fall within budget function 600 (income 
security).
    Basis of estimate: For this estimate, CBO assumes that S. 
1518 will be enacted near the beginning of fiscal year 2008, 
that the amounts authorized will be appropriated, and that 
outlays will follow historical patterns. Components of the 
estimated costs are described below.

                                 TABLE 1. ESTIMATED BUDGETARY EFFECTS OF S. 1518
----------------------------------------------------------------------------------------------------------------
                                                                  By fiscal year, in millions of dollars--
                                                           -----------------------------------------------------
                                                              2007     2008     2009     2010     2011     2012
----------------------------------------------------------------------------------------------------------------
                                               CHANGES IN REVENUES

Changes to Low Income Housing Credits
    Estimated Revenues\1\.................................        0        *       -1       -1       -2       -2

                                        SPENDING SUBJECT TO APPROPRIATION

Spending Under Current Law:
    Budget Authority\2\...................................    1,444        0        0        0        0        0
    Estimated Outlays.....................................    1,428    1,444    1,201      632      380      145
Proposed Changes:
    Homeless Assistance Grants:
        Estimated Authorization Level.....................        0    2,200    2,288    2,330    2,372    2,416
        Estimated Outlays.................................        0       22      375    1,269    1,708    2,077
    Contract Renewals:
        Estimated Authorization Level.....................        0      429      466      474      540      548
        Estimated Outlays.................................        0      258      451      471      514      545
    Research on Interventions for Homeless Families:
        Authorization Level...............................        0        0        8        8        8        0
        Estimated Outlays.................................        0        0        3        5        8        5
    Interagency Council on Homelessness:
        Estimated Authorization Level.....................        0        3        3        3        3        3
        Estimated Outlays.................................        0        3        3        3        3        3
        Total Proposed Changes:
            Estimated Authorization Level.................        0    2,632    2,765    2,815    2,923    2,967
            Estimated Outlays.............................        0      283      832    1,748    2,233    2,630
Spending Under S. 1518:
    Estimated Authorization Level\2\......................    1,444    2,632    2,765    2,815    2,923    2,967
    Estimated Outlays.....................................    1,428    1,727    2,033    2,380    2,613   2,775
----------------------------------------------------------------------------------------------------------------
\1\Estimate provided by the Joint Committee on Taxation (JCT). In addition to the effects shown through 2012,
  JCT estimates that enacting S. 1518 would reduce revenues by an additional $15 million over the 2013-2017
  period.
\2\The 2007 level is the amount appropriated in that year for Homeless Assistance Grants and the U.S.
  Interagency Council on Homelessness.
Note.--* = revenue loss of less than $500,000.

Revenues

    Section 7 of the bill would exclude grant funding 
authorized by the McKinney-Vento Homeless Assistance Act when 
determining the eligible basis of a building receiving Low 
Income Housing Credits under section 42 of the Internal Revenue 
Code of 1986. The JCT estimates that consequent reductions in 
revenue would total $7 million over the 2008-2012 period and 
$22 million over the next 10 years, as shown in Table 2.

                                                       TABLE 2.--CHANGES IN REVENUES UNDER S. 1518
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        By fiscal year, in millions of dollars--
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               2008   2009   2010   2011   2012   2013   2014   2015   2016   2017  2008-2012  2008-2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Estimated Revenues..........................................      *     -1     -1     -2     -2     -2     -3     -3     -3     -4       -7       -22
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note.--* = revenue loss of less than $500,000.

Spending subject to appropriation

    In total, CBO estimates that S. 1518 would authorize the 
appropriation of $2.6 billion in 2008 and $14 billion over the 
2008-2012 period. Appropriation of those amounts would result 
in estimated outlays of $7.7 billion over the next five years.
    Homeless Assistance Grants. S. 1518 would consolidate the 
Department of Housing and Urban Development's (HUD's) separate 
competitive grant programs for assistance to the homeless 
(including the Supportive Housing Program, the Shelter Plus 
Care program, and the Single-Room Occupancy Dwellings program) 
into a single program (the Homeless Assistance Program) and 
reauthorize grants for the emergency shelter needs of the 
homeless. Section 5 of the bill would authorize the 
appropriation of $2.2 billion in 2008 and such sums as 
necessary from 2009 through 2012 for these programs. Assuming 
appropriation of the authorized amounts and adjusting for 
inflation, CBO estimates that implementing this section would 
cost $22 million in 2008 and about $5.5 billion over the 2008-
2012 period.
    Contract Renewals. Section 7 of the bill would authorize 
the HUD to use such sums as necessary from amounts appropriated 
for Section 8 housing assistance to renew expiring contracts 
for the leasing, rental assistance, or operating costs of 
permanent housing for the homeless. Such renewals are currently 
funded through the Shelter Plus Care and Supportive Housing 
programs. In 2006, HUD awarded about $360 million in renewal 
funding covering about 67,000 permanent housing beds. Based on 
data provided by HUD, CBO estimates that renewing expiring 
contracts would require the appropriation of $429 million in 
2008 and $2.5 billion over the 2008-2012 period. Appropriation 
of those amounts would result in outlays totaling an estimated 
$2.2 billion over the next five years.
    Other Provisions. Additionally, section 4 would authorize 
the appropriation of $3 million in 2008 and such sums as 
necessary from 2009 through 2012 for the U.S. Interagency 
Council on Homelessness, and section 10 would authorize the 
appropriation of $8 million for each of fiscal years 2009 
through 2011 for research into the efficacy of interventions 
for homeless families. In total, assuming appropriation of the 
authorized amounts, CBO estimates that implementing these 
provisions would cost $3 million in 2008 and $36 million over 
the 2008-2012 period.
    Intergovernmental and Private-Sector Impact: S. 1518 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. Funds authorized by the bill would benefit 
state, local, and tribal governments that receive grants to 
provide housing and emergency shelter. Any costs those 
governments incur, including matching funds, to comply with 
program requirements would be incurred voluntarily.
    Estimate prepared by: Federal Spending: Chad Chirico; 
Federal Revenues: Thomas Holtmann, Joint Committee on Taxation; 
Impact on State, Local, and Tribal Governments: Lisa Ramirez-
Branum; Impact on the Private Sector: Nabeel Alsalam.
    Estimate approved by: Keith Fontenot, Deputy Assistant 
Director for Health and Human Resources, Budget Analysis 
Division.

                      REGULATORY IMPACT STATEMENT

    In accordance with paragraph 11(b), rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
statement concerning the regulatory impact of the bill.
    This bill reauthorizes and improves programs that are now 
in operation through grants by the Department of Housing and 
Urban Development. The bill requires HUD to issue new 
regulations, but only to formalize policies that HUD now 
enforces in a less formal manner. This bill would have no 
discernable impact on the number of people or businesses 
regulated under the existing program, or in the economic impact 
of regulation. It also has no discernable impact on personal 
privacy compared to the existing program. Finally, the bill 
will not create additional paperwork. It is likely that the 
bill will reduce paperwork, because the bill consolidates 
programs. This is particularly the case for rural areas because 
the changes in procedures for recipients in rural areas would 
result in a simpler application process.

                 CHANGES IN EXISTING LAW (CORDON RULE)

    On September 19, 2007, the Committee unanimously approved a 
motion by Senator Dodd to waive the Cordon rule. Thus, in the 
opinion of the Committee, it is necessary to dispense with 
section 12 of rule XXVI of the Standing Rules of the Senate in 
order to expedite the business of the Senate.

                                  
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