WHY ARE THERE SO MANY HOMELESS PEOPLE IN THE U.S.?
The safety net for millions of Americans has gaping holes. There are fewer jobs, lower real wages, higher health care costs, and less access to welfare and food stamps. There has been a continued decrease in government spending on social services since the early 1980s.
The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996 has constricted the number of people receiving assistance from the federal government.
The housing stock in this country is very low and real estate prices climb higher and higher. The funding available for low-income housing is declining.
Consequently, many people are falling through the cracks and ending up on the streets.
Data from the FY 2002 Federal Budget offers a broad overview of federal spending trends. In looking at the Federal Budget spanning 24 years, from the Ford administration to the current Bush administration, federal spending on housing for the poor (adjusted for inflation) has dropped by a third, while the overall Federal Budget (adjusted for inflation) has increased to almost twice as much.
The Department of Housing and Urban Development (HUD) budget, which serves low-income people, accounts for very little of the total budget. The focus is on building not for the poor, but for the rich. In 2001, the federal government spent an estimated $92 billion in tax subsidies on housing for families who make an average of $135,401 per year. The HUD estimated housing assistance outlays for low-income renters in that year amounted to $31.0 billion.
Within HUD’s budget, funding for new affordable housing construction has dropped dramatically from 1976 to now. The only HUD-funded program that builds low-income housing is the HOPE VI Revitalization Plan. Though meager compared with other expenditures, HOPE VI funds are spent on rebuilding blighted public housing. Unfortunately, due to income-mixing requirements and reductions in the number of available apartments, the overall stock of lowincome housing decreases. Some of the people who live in projects slated for the HOPE VI Revitalization Plan have to vacate their homes.
Renters who bring in a very low yearly income constitute nearly 80 percent of the total number of low income households in San Francisco. They often have to choose between food, health care, and rent. When they can’t pay their rent and they get evicted, where can they go? Housing for minimum wage or unemployed workers is a rare commodity. There is no denying people’s desperate need for greater security in housing. Both nationally and on local levels, there is an increase in housing needs and a corresponding increase in homelessness. The U.S. Conference of Mayors’ 16th Annual Survey, Hunger and Homelessness in America’s Cities, found that almost every participating city believed that homelessness existed because there was not enough affordable housing.
HOPE VI
Created by the federal government, HOPE VI was developed by the Department of Veterans Affairs and Housing and Urban Development (HUD), and Independent Agencies Act, 1993 (Pub. L. 102-389). It was approved on October 6, 1992 as part of the 1993 Appropriations Act. It was originally known as the Urban Revitalization Demonstration. Every year, Fiscal Year’s Notice of Funding Availability (NOFA) offers HOPE VI grants to competing local Public Housing Authorities (PHAs).
There is a Grant Agreement between each HOPE VI grant winner and HUD. PHAs have to make these goals the basis of their HOPE VI projects: 1) To renovate public housing projects into attractive structures, 2) to promote self-sufficiency for low income tenants by helping them get and keep jobs, 3) to instill in residents a sense of personal and community responsibility, 4) to integrate mixed income families within the same project to diffuse the concentration of poor people in one area, thereby encouraging safe communities, and 5) to promote partnerships between the public and private sectors and between the planners, developers, and residents as they work together to map out the improvements. In addition to these well-publicized objectives, the Strategic Objective #3 of HUD’s Strategic Plan for HOPE VI is to “increase availability of affordable housing (sic) in standard condition to families and individuals, particularly the Nation’s poor and disadvantaged.”
The mixed-income requirement of the refurbished housing projects is accomplished through portioning off the total amount of units between public housing assistance recipients (See demographics for understanding), low-income renters who are eligible for a tax subsidy, market-rate renters, homeowners, and the very poor who qualify for full public housing benefits. The public housing tenants who are qualified to move back into one of the rebuilt homes have to make a commitment to a self-sufficiency training program. In 1998, HUD mandated the Family Self-Sufficiency requirements to all public housing tenants who return to the project. If those who are required to participate in this program fail to show improvement, they are evicted from their homes.
In the FY 2003 proposed HUD budget that the current Bush Administration put before Congress, which they are still deliberating on, there is a proposed decrease in public housing capital. The PHAs will be encouraged to make up for the loss through a new program in the proposal. This program will encourage PHAs to rent up to 1/3 of the public housing units to “unassisted” families, meaning they will rent the homes at market rate to cover the expenses of maintaining the rest of the housing. They will also be encouraged to treat the housing like the real estate businesses treat their assets. Up to $50 million in HOPE VI funds could be used for upfront capital contributions.
THE ARGUMENTS
Arguments for and against HOPE VI tend to be repeated throughout different publications. The proponents of this program focus on how much nicer the new housing is, how much better it is for the community to be integrated with families of different incomes living together, and how the new partnerships forged between the public housing authorities and private developers result in innovative structures and communities. Most of the people who uphold this ideal focus on the win-win situation for all people involved in the projects. Andrew Cuomo, former HUD Secretary, says, “It’s hard to go into a city where they’re not talking about how we brought down the high-rises and built beautiful communities.”
HUD’s Office of Public Investments Deputy Assistant Secretary, Elinor Bacon, refers to HOPE VI as “a tremendously exciting program of profound and historical importance in the revitalization of cities.” In an article for the State Housing Finance, Bacon applauds the housing program for changing things for the better both inside and out, that is, improving the look of the homes by “transforming the physical structures” as well as improving the lives of the residents by providing services geared toward helping them become self-sufficient.
In response to the argument of how much better the homes are for both for the residents and the surrounding community, those who are not as happy about HOPE VI return to the fact that fewer units are rebuilt and less low-income renters are eligible to move back upon completion of renovation, resulting in a net loss of low-income homes. In an article for New California Media, Kevin Weston expresses concern about the loss of affordable housing for African Americans in San Francisco. The S.F. Housing Authority applied for a HOPE VI grant to revitalize Hunters View, the largest public housing project in Bay View Hunters Point. Weston says that, due to the income requirements, 50 percent of the families who now live there will not be able to return once the homes are reconstructed in 2005.
With regard to the public/private partnership, James Tracy, from the Coalition on Homelessness’ Right to a Roof! campaign, says that even though private developers‚ involvement in the project results in more funding, the long-term effect is problematic for the original residents.
The “profit motive” is the driving factor for most private entities. He offers this example: “[O]ne private developer moved to strike tenant protections from operating agreements. This developer sought to convert low-income units to market rate should a tenant vacate the apartment.”
WHO IS AFFECTED?
When HOPE VI mixing requirements and demolition projects remove affordable housing, this severely disrupts the lives of a wide spectrum of people: former and current public housing tenants, Temporary Assistance for Needy Families (TANF) recipients, former welfare recipients, near-poor, lowincome families who receive no governmental assistance, the elderly, the disabled.
HOPE VI most immediately affects people who live in projects slated for demolition. The tenants are often told that they will be able to return, as long as: 1) they are not undocumented immigrants; 2) they do not have a felony on their criminal record; 3) they do not have a family member or associate who gets caught dealing or using drugs (a “one strike” policy is enforced). There are usually less units rebuilt than the original number. Also, many of the new housing projects allocate only 1/3 of the units for low-income renters. Most of those displaced by HOPE VI evictions are families.
If a HOPE VI project results in a net decrease in housing stock, then the people on the waiting list are also affected. The San Francisco Housing Authority’s tenant demographics show that there are 17,368 people on the waiting list for public housing, and there are 30,621 people waiting to obtain a Section 8 voucher. Many people who have a section 8 voucher are unable to find a landlord who will take it, so they lose it after 6 months to a year. Then they have to reapply to the Section 8 waiting list, which is closed for two to three years at a time.
The people on the waiting lists for both Section 8 and public housing are very often TANF recipients, or ex-TANF recipients. It varies from state to state, but on average, only about 30 percent of the families in this country who receive TANF benefits also receive federal funding to help them with their rent.
In all but three states, TANF grants are just barely large enough to cover housing costs. Most families who leave TANF to work do not make enough money to afford adequate housing. Households that currently include one or more working members and that used to get welfare earn an average total monthly income of only $1,261 (In 2002 dollars). Consequently, these households need to pay an average of 58 percent of their total income to afford “decent, modest” housing.
Single Room Occupancy (SRO) hotels are the last bastions for poor people who can’t find decent housing. Citywide Families in SROs Collaborative conducted a study named “The Census of Families with Children Living in Single Room Occupancy Hotels in San Francisco,” financed by the San Francisco Department of Public Health. An SRO unit is smaller than a studio apartment, is usually a ten-by-ten square foot room, and has no kitchen or bathroom.
Many SROs are infested with rats, mice, and cockroaches. Bathrooms are shared with the other tenants in the hotel and can be quite unsafe due to drug and prostitution activity. As of October 2001, when the study was released, 450 families and 760 children lived in SROs in SF. But the number is probably actually higher than the findings. Managers of SROs frequently harass families to pay more rent for the extra amount of people living in the room.
If a family loses their home, whether it is private market housing, Section 8, public housing, or SRO, and has no kin or friends who they can “double-up” with, then they really have no place else to go. They become officially “homeless” and can try to seek a homeless shelter to keep from sleeping in their car or on the street. However, in S.F., there are 8-fold as many single adult beds as there are shelter beds for family members who become homeless. According to Bianca Henry, from the Coalition on Homelessness, once a family is homeless for a year, Child Protection Services takes the child/children from the parent or parents and puts them into foster homes.
The parent(s) go to shelters for single adults, if they can. So having less low-income housing affects a family being able to stay together as a family unit.19 (The practice of sending the children to foster care also makes it really hard to get a clear understanding of how many homeless families there are.) The statistics from the San Francisco Department of Social Services, 1994, show that a disproportionate number of homeless people are people of color.
African Americans, who make up 11 percent of the population of SF, make up 50 percent of the women who are homeless, 43 percent of the men who are homeless, and 49 percent of homeless families. 39 percent of homeless women, 20 percent of homeless men, and 16 percent of homeless families are Hispanic, who make up 13 percent of the total SF population.
Caucasian people make up 49 percent of the population of SF but are only 4 percent of homeless females, 30 percent of homeless males, and 23 percent of homeless families. From this data, it would stand to reason that people of color, especially African Americans, would be more affected by a decreasing number of affordable housing units in San Francisco.
Poor people who own homes may be relatively secure. Statistics from the Housing Needs Table of the Comprehensive Housing Affordability Strategy (CHAS) show that 81 percent of lowincome (0-50% of Median Family Income) renters have trouble with housing, while only 48 percent of lowincome homeowners do. That said, if a lowincome home-owner who is paying a mortgage loses their job, there is a chance they could lose their housing.
For instance, if a family is unable to make their payments and is able to buy a home with a HUD insured mortgage, the “lender forecloses on the home.” Then HUD reimburses the lender, takes over the mortgage, and then sells the house “at market value as quickly as possible.”
For the professionals who work in the lowincome housing industry and earn closer to the median family income, HOPE VI grants have had a positive effect. The website for National Housing and Rehabilitation Association boasts a membership consisting of “developers, lenders, investment bankers, non-profit organizations, attorneys, property managers, nonprofit organizations, accountants, financial advisors, syndicators, and state and local agencies.” The site goes on to say, “NH&RA’s Board of Directors is made up of industry leaders constantly on the look out for new opportunities and eager to share their wealth of knowledge with association members.”
The NH&RA proclaims that their conferences help members succeed over competition by providing information about the latest business trends and funding opportunities in the housing industry. They suggest that that these events are a good way to network among people with interlocking professions.
THE NATIONAL HOUSING TRUST FUND
As this is being written, there are programs and policies for Congress to decide on which diffuse the real issues facing the poor in this nation. However, instead of reacting to each new measure directed towards “rehabilitation” and “self-sufficiency” of the aid recipient, a coalition of proactive housing activist groups, the National Housing Trust Fund Coalition, has bravely submitted a groundbreaking bill before Congress.
A housing trust fund is designated solely for the maintenance and creation of affordable homes and established through the legislation of local governments, city, county and state-wide. The revenues for a housing trust fund come from dedicated sources, such as loan repayments or taxes. The National Housing Trust Fund (NHTF) would be on the federal level and would be generated by surplus funds from the Government National Mortgage Association (GNMA) and the Federal Housing Administration (FHA).
Right this very moment, the NHTF is trying to secure enough funding to build and maintain 1.5 million affordable homes in the next 10 years 25 (the total amount of public housing the nation has now is 1.2 million homes). This would stimulate the economy by providing construction jobs, reducing crime rates and prison expenditures, increasing property values, and providing formerly homeless people with living conditions that enable them to live healthier lifestyles, to do better in school, and to get jobs. Obviously, the costs of building affordable housing are significantly lower than the costs of not building it.
Aimee