Low-income Americans are at risk of losing homes subsidized by the Department of Housing and Urban Development's rental assistance as federal officials consider restructuring HUD policy, according to an Associated Press report. Proposed changes include a two-year limit on rental assistance programs to limit waste and fraud in public housing and Section 8 voucher programs.
At a June congressional budget hearing, HUD Secretary Scott Turner said the housing assistance programs have deviated from their original purpose of temporarily helping Americans in need.
“HUD assistance is not supposed to be permanent,” he said.
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However, critics of HUD reform argue that it could potentially destabilize the most vulnerable households, many of which are unlikely ever to be able to afford today’s high rents, the report states.
Research from New York University obtained by The Associated Press found that if families are cut off after two years, 1.4 million households could lose their vouchers and public housing subsidies. Many of these tenants include working families with children, according to AP.
In addition, landlords fear a two-year limit could put their contracts for HUD-subsidized housing in limbo. Although it can be challenging for landlords to navigate the burdensome paperwork, heavy oversight and maintenance inspections associated with HUD subsidies, the trade-off is a near guarantee of dependable, longer-term renters and rental income. If that’s compromised, some landlords say they’d pull back from the federal subsidy programs, as noted in the report.
HUD spokesperson Kasey Lovett said the data supports time limits and shows that long-term government assistance disincentivizes able-bodied Americans from working. The average household in HUD-subsidized housing typically stays for about six years, according to studies.
An analysis of a decade of HUD data by researchers at New York University found that approximately 70% of households potentially affected by a two-year limit had already been receiving those subsidies for two or more years. That estimate doesn’t include elderly and disabled people who wouldn’t be subject to time limits. Exempted households make up about half of the roughly 4.9 million households receiving rental assistance, according to AP.
Both Democrats and Republicans have acknowledged the potential for time limits to help curb HUD’s notorious wait lists.
Some localities have tried limits on assistance with varying results, the report said. Keene, New Hampshire, implemented five-year time limits starting in 2001, but terminated the policy before fully enforcing it to avoid evicting households that would still be rent-burdened or potentially homeless. The Housing Authority of San Mateo County in California has maintained its five-year time limit in conjunction with educational programs aimed at motivating individuals to achieve their goals and make vouchers available to more people in need.
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Kristen Smithberg
Kristen Smithberg is a Colorado-based freelance writer who covers commercial real estate, insurance, benefits and retirement topics for BenefitsPRO and other industry publications.
