How President Obama's Budget Proposal Would Affect Cities

Three programs to watch as federal budget negotiations kick off.

President Obama’s budget proposal for fiscal year 2014, released this morning, focuses on economic growth and a strong middle class. Better urban development isn’t the first item on that agenda, but it’s an important part of the administration’s priorities for the coming year.

Three agencies in particular are at the core of that work, with offices dedicated to making sure community development contributes to regional and national economic growth. The president’s 2014 budget would change how each of these agencies invest in community development. Here’s how it breaks down:

The Department of Housing and Urban Development (HUD) would see a significant increase in funds for neighborhood revitalization through $400 million in funding for the Choice Neighborhoods program (up from $120 million appropriated in 2012). The budget cuts funding for the Community Development Block Grant program to $2.8 billion (down from $3.241 billion in 2012), but includes $200 million in new competitive funding to reduce and repurpose vacant and blighted properties and create jobs in communities hardest hit by the foreclosure crisis.

HUD’s former Office of Sustainable Communities would combine forces with the Office of Community Planning and Development to improve the agency’s focus on economic resilience. The budget requests $75 million for new Integrated Planning and Investment Grants, designed to encourage regions and communities to comprehensively plan for new development. The grants would include incentives to align planning efforts across municipalities, invest public funds to attract private dollars, modernize land use and building codes, and sponsor robust community engagement efforts.

The Environmental Protection Agency sees some of the largest cuts, with an overall proposed budget of $8.2 billion (down from $8.496 billion in 2012). The budget proposal includes only $158.6 million for the brownfields program (down from $167 million in 2013). However it increases funding for brownfields technical assistance to help sites get cleaned up and get more projects off the ground. A bill currently moving through Congress—the BUILD Act—would reauthorize funding for the brownfields program. My colleague Craig Chester recently wrote about the bill and how it would help America’s neighborhoods.

Not mentioned in the budget is the EPA’s Smart Growth program, a key part of the administration’s overall community and economic development strategy. The Smart Growth office is administered by EPA’s Office of Environmental Programs and Management (EPM), and the budget requests $2.8 billion for that office as a whole (up from $2.694 in 2013). It’s not clear if the Smart Growth office’s budget would reflect that change.

The budget also cuts EPA funding for water and wastewater infrastructure improvements through the state revolving loan funds program, requesting $1.91 billion (down from $2.388 billion in 2013). These funds help smaller communities improve their drinking water and wastewater infrastructure. Reducing these funds would make it harder for communities to make these improvements.

The Department of Transportation’s budget includes $50 billion in immediate transportation spending across a number of modes:
 

The $4 billion for credit assistance and grants includes a capital investment program similar to the existing TIGER program. DOT’s budget also includes $1 billion for TIFIA, a federal credit assistance program for national or regionally significant transportation projects.

Of course, any president’s budget proposal is just a jumping-off point that starts a long process of negotiating with Congress. And this president and this Congress have rarely seen eye to eye on spending priorities. But President Obama’s proposals today at a minimum shed light on which community development programs the administration sees as worth fighting for.

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