Proposed Tax Break for the Poor Dropped

A White House working group debating the Clinton Administration’s new homeless policy has discarded a proposal to allow poor people to take a tax deduction for housing.

The Interagency Council on the Homeless met this past week to discuss changes to a draft document circulated privately among the council’s 16 member agencies and other interested organizations.

The draft, titled “Priority: Home! The Federal Plan to End Homelessness, Building a Comprehensive Solution,” proposes a “continuum of care” approach, which goes beyond emergency treatment to encompass treatment, training and education programs for the homeless, leading to eventual re-integration into the larger society.

“Government must address the needs of at-risk families and individuals vulnerable to ‘crisis poverty,’ ” the draft said.

“At the same time, it must attend to the more complex situation of those who also suffer from disabling conditions, the ‘chronically disabled.’ ”

The report was produced by the council with participation by member agencies. However, knowledgeable sources said that it was largely prepared at the Department of Housing and Urban Development by the office of Andrew Cuomo, HUD’s assistant secretary for community planning and development.

At this past week’s “clearance meeting,” agencies were invited to suggest changes in the draft document. While the underlying principles remained intact, the sources said, many agencies sought to make sure their own programs were included in a reworked report expected to be circulated this week.

The council members also agreed that the final report needed a larger discussion of the nature and numbers of homeless populations.

The draft made use of a 1992 study suggesting that 7 million Americans were homeless “at some time” during a five-year period. This contrasts with “snapshot” surveys putting the homeless population at 600,000 to 800,000 on any given night.

The sources said the council torpedoed a HUD proposal to allow poor people to take a low-income housing tax deduction as a means to augment disposable income.

The deduction would be prohibitively expensive and impossible to enact, the sources said.

There were also ruffled feathers among some council members who felt that HUD was controlling the plan, which was requested by President Clinton in an executive order last May, the sources said.

The Interagency Council was moved to the White House from HUD last October to serve as a working group under the President’s Domestic Policy Council.

It is unclear from the draft document what the chain of command will be between the Interagency Council, HUD and the respective agencies when the time comes to implement the final proposal.