Trump’s Budget Wish List: What It Could Mean for Alabama

by Nick Patterson

If President Trump were to get the federal budget he proposed in February, people in Alabama would stand to lose programs designed to improve distressed neighborhoods, provide affordable housing in rural communities, assist small manufacturers, support the training of nurses, provide legal assistance to low-income residents and veterans, pay for economic and workforce development in Appalachia and support farm workers.

Trump’s 66 proposed cuts – a wish list he put out to signal policy priorities – would touch a wide array of programs affecting people, whether they live in urban or rural areas. Those employed in health care, space exploration and farming, and educational opportunities for students would be affected, among others.

Noting that Trump’s proposed cuts would bring steep cuts to domestic programs, including Medicare, Medicaid, the Supplemental Nutritional Assistance Program (SNAP), Community Development Block Grants, housing programs, worker training programs, and more,” Rep. Terri Sewell, a Democrat from Alabama’s 7th Congressional District, portrayed the president’s efforts as bad for needy Americans, including those in her state.

“In order to pay for tax cuts for the wealthy, President Trump is now proposing severe cuts to the federal programs that America’s working and low-income families rely on. As healthcare costs, food costs, and education costs rise, President Trump’s budget hits working families where it hurts the most by cutting the basics, including food assistance and child care, repealing the Affordable Care Act, slashing funding for student aid, and a host of programs that specifically help communities of need,” she said in a statement. “In Alabama, over 850,000 residents rely on SNAP to put food on the table, a program which Trump’s budget cuts by over $200 billion. Over 900,000 Alabamians rely on Medicare for healthcare coverage and many hospitals in our state are struggling to stay open, but the President’s budget slashes Medicare funding by $230 billion.”

Trump’s proposed budget cuts would, if they all went into effect, get rid of a number of programs Alabamians across the political spectrum have used.

Alabama as a state, studies show, gets more money from the federal government than it puts in. For every dollar paid in federal taxes, Alabama gets more than twice as much back, which is one of several reasons the financial research group WalletHub ranks the state as the 4th most federally dependent in the country.

No one seems to expect all of the Trump-recommended cuts to be enacted, but BirminghamWatch took a look at what the effects would be for Alabama if the president were to get his way.

But First: Can He Do That?

The federal budget can be confusing. So, a little context is in order.

First, Congress has the power of the purse in the U.S., meaning that the legislative branch, not the executive branch, where the president sits, actually determines how much money goes where.

A February Washington Post story pointed to the difficulties in the executive branch eliminating programs that already are being funded. A major impediment has been that Congress has enacted a series of continuing budget resolutions that generally require that agency funding be maintained. The Post quoted Marc Goldwein, senior vice president at the Committee for a Responsible Budget, saying, “The executive branch can’t just say, ‘We’re going to close down this part of government that has appropriated dollars.’”

Even so, the president does have the ability to affect, in several ways, how Congress carries out that responsibility. That same Washington Post story noted that Trump’s intent is to restructure the way the government operates. His efforts were bolstered in March when some in Congress moved to approve formal appropriations bills that would allow for a reordering of agency priorities.

So, although Congress sent Trump a budget in February – a bipartisan two-year budget deal which he signed off on – shortly thereafter he released a budget proposal of his own, which did not match the Congressional deal he had just signed.

In the February White House budget proposal, described by some as Trump’s wish list, he called for steep cuts to some federal programs. For example, his budget proposal calls for $1.8 trillion in reductions to federal entitlement programs, including Medicaid, Medicare and food stamps. SNAP, or the Supplemental Nutrition Assistance Program, would be cut by 30 percent over the next 10 years, for example.

Of the programs on the original list of 66 that the president proposed to eliminate, there were 40 that would impact Alabama, based on a BirminghamWatch examination.

Those programs have not been eliminated at present, but some federal agencies have already signaled their support of Trump’s wishes. At the same time, there are agencies, nonprofits and others criticizing the proposed cuts and hoping they don’t get enacted.

What If? One Example

As one example of what might happen if Trump’s wish list budget were to go into effect, consider the Self-Help and Assisted Homeownership Opportunity Program (SHOP) account, a function of the Department of Housing and Urban Development (HUD).

The HUD website both describes SHOP – and then justifies getting rid of it:

“The Self-Help Homeownership Opportunity Program (SHOP) account includes funding for SHOP, Capacity Building for Community Development and Affordable Housing (Section 4), rural capacity building, and a pilot home modification and rehabilitation program for disable and low-income veterans. The fiscal year 2018 budget proposes to eliminate this account and direct Federal resources to other activities. State and local governments are better positioned to serve their communities based on local needs and priorities. The programs are also duplicative or overlap with other Federal, State and local efforts.”

You may not have heard of SHOP, but the program has provided funds to programs in Alabama. An example is Habitat for Humanity, the well-known agency that provides housing for those who might not be able to afford it, including those impacted by disasters. From 2010 to 2017, the 33 local Habitat organizations in Alabama have served more than 2,000 families, building nearly 740 homes, and rehabilitating or repairing more than 1,500 homes, the organization told BirminghamWatch.

AmeriCorps members serving with Habitat for Humanity worked on houses during Habitat for Humanity International’s seventh annual National Service Leadership Conference. Funding for Habitat, which has been used to build and repair houses in Alabama, including after disasters, would be cut with the elimination of a program President Trump wants to get rid of, officials said. (Source: Habitat for Humanity)
Local Habitat organizations compete for SHOP money. Another organization, the national nonprofit Housing Assistance Council (HAC), which also administers SHOP funds in primarily rural areas, sometimes works with Habitat and indicated that Habitat has built more than 100 homes in Alabama since 2015. Local Habitat organizations in Alabama have been awarded more than $4.1 million in SHOP funds since 1996.

Bryan Thomas, spokesperson for Habitat for Humanity International, said cutting SHOP will negatively impact Alabama. “The Self-Help Homeownership Opportunity Program has helped Habitat build more than 350 affordable homes in the state of Alabama alone,” he said in a statement to BirminghamWatch. “SHOP provides some of the only direct support for low-income homeownership opportunities, and these dollars go directly to helping local Habitat organizations build desperately needed affordable housing across the state and around the country. We strongly oppose proposals to eliminate the funding, and we’re urging Congress to reject these cuts.”

At the time of the White House budget proposal, leadership at Habitat sounded the alarm about the potential impact of Trump’s proposed cuts on the housing crisis in the U.S.:

“With more and more families across America facing the choice between making housing payments and buying food, we are called on to rise to this challenge together. This moment calls for greater investment in affordable housing, not less,” said Jonathan Reckford, CEO of Habitat for Humanity International.

“The budget proposed by the White House today would drastically cut –and in some cases entirely eliminate – funding that communities use to finance the development of new affordable homes.

Thomas also echoed those concerns and pointed out how SHOP benefitted Alabamians reeling from a devastating series of tornadoes that hit the state April 27, 2011.

“SHOP is unique in that it helps nonprofits finance infrastructure and acquire land for home developments, which is a challenge to fund. As land prices increase, the need for SHOP has increased with it. SHOP is also especially important for more rural affiliates who run into roadblocks obtaining other funded programs focused on urban city development,” Thomas said.

“Habitat for Humanity of Tuscaloosa has received multiple federal funds for projects including SHOP for infrastructure and land purchases, Government funds like this paired with privately raised donations have helped Habitat Tuscaloosa build or repair over 200 homes since the April 2011 tornadoes.”

Thomas disagreed with the Trump administration assertion that SHOP is “duplicative or overlap[s] with other federal, state and local efforts.”

“SHOP,” he said, “is unlike any other program HUD offers because it’s the only one that provides homeownership opportunities for low-income families.”

Over the coming weeks, BirminghamWatch will look at a number of the programs on President Trump’s chopping block and ask “What If.” Stories behind the programs targeted for elimination show why they’re valued or disdained, troubled or effective, applicable or outdated, but perhaps most of all entangled in the lives of Alabama people, their governments, and community businesses and other institutions.