Officials: Obama budget will cut senior housing funds

Funding for elderly housing would be cut in President Barack Obama's proposed budget for next year in a way that could affect as many as 1,000 low-income seniors living in rental units on Long Island, Sen. Charles Schumer warned Wednesday.

However, HUD officials say the budget cuts wouldn't affect the elderly already living in the federally subsidized units, but instead halt funding for construction of future projects.

Under Obama's 2011 fiscal plan, money would drop nationwide in the Section 202 housing program - designed to help low-income seniors afford rental housing - from this year's $825 million to a proposed $273.7 million. Currently, residents assisted by the program occupy 469 units in Nassau County and 269 in Suffolk, with their rent partially or fully subsidized based on annual income levels.

While the proposed spending for next year would keep current residents in their homes, Schumer said the proposed cuts would prevent much-needed housing developments from being launched. Developers of new elderly housing projects would be forced to look for financing elsewhere, Schumer said.

U.S. Housing and Urban Development officials said that under the Obama budget proposal, $550 million in capital funds for future housing projects would be "suspended" for so officials could "revamp" the current capital program that helps finance elderly housing, said Carol Galante, HUD Deputy Assistant Secretary for Multifamily Housing. The projects often are built by nonprofit groups, Galante said, adding that she is not certain when the funds might be restored.

On Long Island next year, there will be "no impact on those already living in Section 202 housing," Galante said.