HUD Wants to Help Poor Tenants by Raising Rents and Cutting Housing Assistance
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| Photo cred: Washington Post |
It’s shocking because HUD is the very agency charged with providing housing to vulnerable people, and shocking because across the country, and specifically in New York City, there is a housing shortage exasperating a universally acknowledged affordable housing crisis and increasing homelessness. The affordable housing crisis impacts moderate- and middle-income households, but, is especially difficult for very low-income households and people living in poverty.
HUD’s proposed new legislation, ironically titled the “Making Affordable Housing Work” Act of 2018, offers no new assistance and creates no new housing. The Center for Budget and Policy Priorities noted, “It isn’t clear that there’s any policy rationale behind this. If you work, they raise your rent. If you don’t work, they raise your rent. If you’re elderly, they raise your rent.”
The proposed harsh rent increases are particularly galling because the widely accepted definition that any household spending over 30% of gross income on rent is “rent-burdened” is a HUD developed standard. Though the history of the federal rent cap isn’t well known, it arises from legislation passed in 1969 authored by Republican Massachusetts Senator Edward Brooke setting the limit at 25% of household income for rent in public housing. Representative Barney Frank (D-MA) later recalled the legislative intent of the Brooke amendment was “…that the poorest of the poor who get housing through various public programs shouldn’t be expected to pay more than 25% of their income for housing, precisely because they have so little.”
In 1981, Congress raised the housing cap to 30%, in conformity with HUD that over 30% of income for housing is an undue rent-burden policy. Since that time the 30% rule has been widely accepted by academics, commentators, financial advisors and policy makers. Care for the Homeless, and most advocates for unstably housed or poor people advocate for the cap not to exceed 30% as a matter of policy in all housing subsidy programs. It was only a couple of years ago that CFH was part of a broad advocacy campaign that successfully resulted in adopting a not to exceed 30% cap for HASA housing for people living with HIV/AIDS in New York.
Actually, the new proposed HUD bill is even worse than just raising the rent cap from 30%-to-35%. It would create a rent minimum payment for the tenant’s share of rent of either 35% of household gross income or 35% of the amount earned by an individual working 15 hours a week at minimum wage, whichever is highest. The HUD Secretary then has the authority to increase the 15 hours up, but not adjust it down. The bill also allows for higher minimum rents even for households of elderly or disabled people, with the HUD Secretary having the authority to increase those rents, too, through a regulatory process, without further legislation.
The proposed legislation also provides authority for “alternate family rent structures” to include “tiered rents, stepped rents, or timed escrow”, though these alternatives could further erode protections provided in a rent cap. The bill allows for a minimum work requirement rule as a condition for housing for people under 65 years of age and not disabled. Even reviews of decreases in household income, which would decrease tenant rent under a 35% rental cap rule, would only be required every 3 years unless household income falls by “20 percent or more."
For our clients at CFH, many of whom live on fixed incomes far below the poverty threshold, these kinds of draconian rent increases present an enormous obstacle to finding and maintaining stable housing. This policy proposal that would hurt millions of vulnerable Americans comes at the same time the Agriculture bill making its way through Congress threatens to reduce SNAP food subsidy supports, challenging long accepted government programs to provide both food and housing to people in desperate need.
HUD Secretary Carson explained his support for the legislation by saying, “The current system isn’t working very well. Doing nothing is not an option.” There we will agree with the Secretary. A housing system designed to address the human right for housing that provides assistance to less than a quarter of those who qualify, and results in increasing homelessness in places like New York City isn’t working. But the answer isn’t to do less. It’s to do more.
HUD’s new proposal won’t reduce the housing crisis in America or New York City, and it certainly won’t reduce income inequality or lower barriers to social mobility. It can only make things worse. Raising rents and cutting people in need from basic housing programs won’t save public resources, either. Countless academic studies, and common sense, shows that the cost for unstable housing and homelessness are far greater than the cost of subsidized or public housing.
The HUD proposed bill hasn’t yet been introduced in Congress, where it would have to pass both the House and the Senate before the President could sign it into law. But it’s not too early for advocates concerned about the basic right to housing for vulnerable people to let their members of Congress know how unacceptable this bad policy proposal is, and that providing stable housing for people in need is both the right thing to do and a cost savings for all of us.
By Policy and Advocacy
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