Federal Homeless Policy Update
It might seem hard to fathom, but it wasn’t too many years ago that the Section 8 housing program represented the conservative policy maker’s vehicle of choice for farming out the HUD budget to “market forces.” The assault on “big government” was just picking up steam in the mid 1970s and the balance sheet suggested a partial federal subsidy floated on the open market was preferable to the price tag otherwise represented by the remaining corners of the HUD budget.
In launching Section 8, President Nixon called public housing a “waste of taxpayer’s money” and froze new construction while aiming to ‘voucher out’ Federal investment. After all, if poor people had to receive any federal housing assistance, why not sweeten the pot for private landlords and get HUD out of the business of housing altogether?
It was simple really. Drop a few housing vouchers into the private real estate market—especially during downturns in the rental market or increases in vacancies—and you’ve made everyone happy, particularly the free market rowdies who viewed public housing as a bloated legacy of the New Deal.
But a funny thing happened on the way back to the Nineteenth Century. Vouchers worked. Tenants, landlords, local governments and others found the blend of market based housing and public subsidy a relative success. In fact, President Ford requested over 500,000 vouchers in his last budget.
However, like any public subsidy—even partial ones couched within the trappings of the American Dream—costs tended to escalate over time. Inflation, increased demand, limited supply, and profit margins can be pesky irritants to the “logic” of the free market, especially when public interest gets teased into the mix.
But as housing costs have risen precipitously over the years and wages have stagnated, the HUD budget has continued a steady decline (65% cut over the past 25 years). So while the Federal government has largely retreated from financing the construction of housing, its free market solution has similarly failed to absorb and capture the resulting gap.
Meanwhile, poor renters haven’t gone away. Yet, as virtually no new funding for housing production is appropriated annually and deep cuts continue to plague programs for the disabled, elderly, and persons living with HIV/AIDS, those who are hostile to any federal role in affordable housing make the perverse claim that the Section 8 voucher system takes up a disproportionate share of the overall HUD budget and must therefore be “reformed.”
Reformed or dismantled altogether? Creating a crisis and then offering a draconian corrective seems to have become old hat in Washington, DC. On the heels of two woefully inadequate fiscal year budget requests, twelfth hour changes to the Section 8 funding formula, and the Housing Assistance for Needy Families (HANF) proposal (‘because TANF just isn’t good enough!’), the Bush Administration introduced the State and Local Housing Flexibility Act (S. 771 and HR 1999) in April.
Among other items, the bill would block grant funding of the program, radically alter the income targeting, change the affordability standard of a tenant’s rent, and impose term limits on housing assistance. Currently, under the Section 8 program, 75% of vouchers must serve households with incomes at less than 30% of the area median, which in San Francisco is roughly $28,500 per year ($95,000 is area median, and $10,712 represents an annual full time minimum wage income).
Under the proposal, however, such income targeting would be adjusted to simply require that 90% of vouchers serve households at 60% of median, or $57,000 per year.
In a housing market as tight as the Bay Area, it’s not hard to imagine the disastrous consequences such legislation might have on poor people. For a program that largely owes its origins to an attempt to showcase how the marketplace could deliver where federal dollars could not, and for a program which continues to subsidize businesses that fail to pay their own workers adequate wages, these ongoing efforts to completely disband the program are wrought with bitter irony. But the fewer extremely low income households who benefit from what remains of Section 8 the less the federal subsidy, and that sadly, it seems, remains the ultimate goal.
In early June the U.S. Conference of Mayors will consider a resolution at their annual meeting in Chicago calling on all federal agencies to adopt a common definition of homelessness based on the one used by the Department of Education. This definition reflects the realities of homelessness, including those living doubled or tripled up, living in hotels, motels, and campgrounds due to lack of alternative accommodations.
But because these households are not included in HUD’s definition (and certainly not covered under the U.S. Interagency Council on Homelessness’s ultra restrictive “chronic” definition), families, children and youth who are without permanent housing and living in these situations are excluded from HUD services.
Ignoring the real need for housing and homeless assistance by using a scaled down, limited definition of homelessness does nothing to address the causes of and solutions to homelessness. Only by acknowledging the extent of homelessness can communities and policy makers appropriately respond. The proposed resolution is a good start.
The policy train wreck created by HUD’s March 21st Continuum of Care funding notice continues to be felt in real terms across the country. It’s clearer than ever that, despite the lofty rhetoric, the Administration’s “10 year plan to end ‘chronic’ homelessness” is drawing funding from existing programs rather than from an expanded pot of resources.
From San Francisco to Oregon to Iowa to Louisiana critical programs that provide transitional housing for victims of domestic violence, housing for women at risk of losing custody of their children because of a mental disability, case management, employment services, childcare and other housing and services are being de-funded at the local level in order to conform to and fund the “chronic” homeless emphasis and housing first model promoted by the Interagency Council on Homelessness and required within HUD funding streams.
The tragic and inevitable legacy of the Administration’s “chronic homeless” initiative is shaping up to be the creation of more homelessness in a desperate attempt to ‘end’ the most visible forms.
Brad
