Section 8 (housing)
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Section 8 of the Housing Act of 1937 (42 U.S.C. § 1437f), often simply known as Section 8, as repeatedly amended, authorizes the payment of rental housing assistance to private landlords on behalf of approximately 3.1 million low-income households in the United States. It operates through several programs, the largest of which, the Housing Choice Voucher program, pays a large portion of the rents and utilities of about 2.1 million households. The U.S. Department of Housing and Urban Development manages the Section 8 programs.
The Housing Choice Voucher Program provides "tenant-based" rental assistance, so a tenant can move from one unit of at least minimum housing quality to another. It also allows individuals to apply their monthly voucher towards the purchase of a home, with over $17 billion going towards such purchases each year (from ncsha.org analysis). The maximum allowed voucher is $2200 a month.
Section 8 also authorizes a variety of "project-based" rental assistance programs, under which the owner reserves some or all of the units in a building for low-income tenants, in return for a Federal government guarantee to make up the difference between the tenant's contribution and the rent in the owner's contract with the government. A tenant who leaves a subsidized project will lose access to the project-based subsidy.
The United States Department of Housing and Urban Development and the United States Department of Veterans Affairs have created a program called VASH (Veterans Affairs Supportive Housing), or HUD-VASH, which distributes roughly 10,000 vouchers per year at a cost of roughly $75Million per year to eligible homeless and otherwise vulnerable U.S. armed forces veterans. This program was created to pair HUD-funded vouchers with VA-funded services such as health care, counseling, and case management.
Federal housing assistance programs started during the Great Depression to address the country’s housing crisis. In the 1960s and 1970s, the federal government created subsidy programs to increase the production of low-income housing and to help families pay their rent. In 1965, the Section 236 Leased Housing Program amended the U.S. Housing Act. This subsidy program, the predecessor to the modern program, was not a pure housing allowance program. Housing authorities selected eligible families from their waiting list, placed them in housing from a master list of available units, and determined the rent that tenants would have to pay. The housing authority would then sign a lease with the private landlord and pay the difference between the tenant’s rent and the market rate for the same size unit. In the agreement with the private landlord, housing authorities agreed to perform regular building maintenance and leasing functions for Section 236 tenants, and annually reviewed the tenant’s income for program eligibility and rent calculations.
The Housing and Urban Development Act of 1970 introduced Federal Experimental Housing Allowance Program ("EHAP") and Community Development Corporation and authorized larger outlays for housing subsidy programs and rent supplements for moderate-income households.
In the 1970s, when studies showed that the worst housing problem afflicting low-income people was no longer substandard housing, but the high percentage of income spent on housing, Congress passed the Housing and Community Development Act of 1974, further amending the U.S. Housing Act of 1937 to create the Section 8 Program. In the Section 8 Program, tenants pay about 30 percent of their income for rent, while the rest of the rent is paid with federal money.
The Section 8 program initially had three subprograms — New Construction, Substantial Rehabilitation, and Existing Housing Certificate programs. The Moderate Rehabilitation Program was added in 1978, the Voucher Program in 1983, and the Project-based Certificate program in 1991. The numbers of units a local housing authority can subsidize under its Section 8 programs is determined by Congressional funding. Since its inception, some Section 8 programs have been phased out and new ones created, although Congress has always renewed existing subsidies.
The 2008 Consolidated Appropriations Act (Public Law 110-161) enacted December 26, 2007, allocated $75 million funding for the HUD-Veterans Affairs Supportive Housing (HUD-VASH) voucher program, authorized under section 8(o)(19) of the United States Housing Act of 1937. This new program combines HUD Housing Choice Voucher rental assistance for homeless veterans with case management and clinical service support which is provided by Veterans Affairs administration at its own medical centers and also in the community.
Currently, the main Section 8 program involves the voucher program. A voucher may be either "project-based" -- where its use is limited to a specific apartment complex (public housing agencies (PHAs) may reserve up to 20% of its vouchers as such) -- or "tenant-based", where the tenant is free to choose a unit in the private sector, is not limited to specific complexes, and may reside anywhere in the United States (including Puerto Rico) where a PHA operates a Section 8 program.
Under the voucher program, individuals or families with a voucher find and lease a unit (either in a specified complex or in the private sector) and pay a portion of the rent. Most households pay 30% of their adjusted income for Section 8 housing. Adjusted income is a household’s gross (total) income minus deductions for dependents under 18 years of age, full-time students, disabled persons, or an elderly household, and certain disability assistance and medical expenses.
There is an asset test in addition to earned income. Over a certain amount, HUD will add income even if the Section 8 tenant doesn't receive any interest income from, for example, a bank account. HUD calls this "imputed income from assets" and in the case of a bank account, HUD establishes a standard "Passbook Savings Rate" to calculate the imputed income from the asset. This makes the tenant's contribution higher since their gross income is made higher.
The PHA pays the landlord the remainder of the rent over the tenant's portion, subject to a cap referred to as "Fair Market Rent" (FMR) which is determined by HUD. Each year, the federal government looks at the rents being charged for privately owned apartments in different communities, as well as the costs of utilities (heat, electricity, etc.) in those communities. The "Fair Market Rents" are an estimate of the average gross rents (rents plus utilities) for medium-quality apartments of different sizes in a particular community. As an example, 2012 FMR for 1 bedroom housing in San Francisco is $1522 and in New York is $1280 while in many other places it is less than $500.
The landlord cannot charge a Section 8 tenant more than a reasonable rent and cannot accept payments outside the contract.
In addition, landlords, although required to meet fair housing laws, are not required to participate in the Section 8 program. As a result, some landlords will not accept a Section 8 tenant. This can be attributed to such factors as:
- not wanting the government involved in their business, such as having a full inspection of their premises by government workers for HUD's Housing Quality Standards (HQS) and the possible remediations required
- fear that a Section 8 tenant or their children will not properly maintain the premises
- a desire to charge a rent for the unit above FMR
- unwillingness to initiate judicial action for eviction of a tenant (HUD requires that Section 8 tenants can only be evicted by judicial action, even where state law allows other procedures)
Depending on state laws, refusing to rent to a tenant solely for the reason that they have Section 8 may be illegal. Landlords can use only general means of disqualifying a tenant (credit, criminal history, past evictions, etc.).
However, other landlords willingly accept Section 8 tenants, due to:
- a large available pool of potential renters (the waiting list for new Section 8 tenants is usually very long, see below)
- generally prompt regular payments from the PHA for its share of the rent
- tenants incentive to take good care of the property (PHA's require that tenants not damage rental properties. In many instances a tenant may be removed from the program if they owe a previous landlord monies).
Whether voucher or project-based, all subsidized units must meet the HQS, thus ensuring that the family has a healthy and safe place to live. This improvement in the landlord's private property is an important byproduct of this program, both for the individual families and for the larger goal of community development.
Applicants may apply for a Section 8 housing voucher at any county or city housing authority office in their state, and although rules vary according to each authority, in general, residents of a particular area who receive a voucher from the jurisdiction in which they live may use the voucher anywhere in the country, but nonresidents of the jurisdiction must live in the jurisdiction that issues the voucher to them for 12 months before they can move to a different area. Also, priority for vouchers is often reserved for those who reside in the service area of that housing authority.
In many localities, the PHA waiting lists for Section 8 vouchers may be thousands of families long, waits of three to six years to access vouchers is common, and many lists are closed to new applicants. Wait lists are often briefly opened (often for just five days), which may occur as little as once every seven years. Some PHAs use a "lottery" approach, where there can be as many as 100,000 applicants for 10,000 spots on the waitlist, with spots being awarded on the basis of weighted or non-weighted lotteries, with priority sometimes given to local residents, the disabled, veterans, and the elderly. There is no guarantee that anyone will ever receive a spot on the waiting list.
Families who participate in the program must abide by a series of rules and regulations, often referred to as "family obligations", in order to maintain their voucher, including accurately reporting to the PHA all changes in household income and family composition so the amount of their subsidy (and the applicable rental unit size limitation) can be updated accordingly. In recent years, the HUD Office of the Inspector General has spent more time and money on fraud detection and prevention.
Earned Income Disallowance
There is a provision for disabled people who have a Section 8 subsidized dwelling to have their rent frozen for a specified time if they are working part-time below a certain amount of money. This is called the Earned Income Disallowance or Earned Income Disregard (EID) and is stipulated under US 24 CFR 5.617, "Self-sufficiency incentives for persons with disabilities—Disallowance of increase in annual income". This was enacted as part of Quality Housing and Work Responsibility Act of 1998 (QHWRA) (Sec. 508(b); 42 U.S.C. 1437a(d). This requires Public Housing Authorities and some owners, in calculating rent, to temporarily “disregard” increased income earned when certain public housing residents and disabled participants in certain housing assistance programs return/go to work or job-related programs. The idea is to foster self-sufficiency for those who are on subsidies and disability and other assistance.
Howard Husock, vice president for policy research at the Manhattan Institute, heavily criticized Section 8 in a 2003 book on housing policy as a vehicle for exporting inner-city social problems to the suburbs.
Hanna Rosin, an American journalist, has argued that Section 8 has led to crime being more evenly spread out across U.S. metropolitan areas, without any net decrease. This was the core thesis of her article published by The Atlantic in 2008, in which she linked Section 8 to a crime wave in the Memphis, Tennessee metro area. Rosin's article attempted to position Memphis as just one particularly troubling example of a nationwide trend: "Still, researchers around the country are seeing the same basic pattern: projects coming down in inner cities and crime pushing outward, in many cases destabilizing cities or their surrounding areas." Rosin's article has been highly influential among politicians in cities claiming to be severely impacted by Section 8, such as Lancaster, California.
Rosin's article was later criticized by Greg Anrig in an article published on the The American Prospect. In the article, Anrig accuses Rosin of placing an excessive amount of blame on housing policy for the reported increase in crime. The article makes reference to the fact that Rosin never made a conclusive argument that those who participate in Section 8 were responsible for the higher rates of crime, as those who receive housing support are subject to screenings based on drug use and previous criminal activity. Rosin instead relies on a heat map of crime created by Richard Janikowski and Phyllis Betts who are reported to have said they were "[…] amazed -- and deflated -- to see how perfectly the two data sets fit together."
Janikowski and Betts later disavowed any connection between housing vouchers and increases in crime in the area in a later letter to the editor for the Atlantic. Rosin failed to mention that there was a consistent decrease and increase in crime from inner-cities to the inner-ring suburbs across most metropolitan areas due to shifting populations. Anrig argues that economic factors are more likely responsible for Memphis’s increase in crime, as male unemployment almost doubled between the years of 1990 and 2000. Anrig also makes reference to Moving to Opportunity (MTO), a randomized policy experiment. The study concludes that there was no increase in violent crime for the participants of subsidized housing or their surrounding neighborhoods in the five cities tested; Memphis was not a part of the study. Even though the participants were far more likely to stay in poorer areas when given the chance to leave, families still received a modest academic and psychological benefit. In fact, according to a paper prepared for the U.S. Department of Housing and Urban Development and the Office of Policy Development and Research rather than increasing crime, those who use housing vouchers are more likely to move into areas where crime is increasing.
- Hills v. Gautreaux (1976) - a U.S. Supreme Court case upholding use of Section 8 vouchers to remedy housing discrimination in site selection by the Chicago Housing Authority.
- Public housing in the United States
- Public housing
- Subsidized housing
- Described further in "Programs of HUD", HUD.
- "HUD History", HUD website
- Winnick, Louis, "The Triumph of Housing Allowance Programs: How a Fundamental Policy Conflict Was Resolved", Cityscape: A Journal of Policy Development and Research, Volume 1, Number 3, September 1995, U.S. Department of Housing and Urban Development, Office of Policy Development and Research
- HUD, "Overview of HUD-VASH Vouchers" - U.S. Department of Housing and Urban Development
- HUD, "Project Based Vouchers" "Project-based vouchers are a component of a public housing agency's (PHAs) housing choice voucher program. A PHA can attach up to 20 percent of its voucher assistance to specific housing units if the owner agrees to either rehabilitate or construct the units, or the owner agrees to set aside a portion of the units in an existing development."
- "Section 8 Rent", massresources.org
- Steinberg, Jessica, Esq., "The Income and Assets Test for Section 8 Housing", Legal Network News, California Advocates for Nursing Home Reform (CANHR), Winter 2004. "If a family’s net assets are worth more than $5000, the family must count toward annual income the greater of either (1) all income derived from the assets, or (2) a percentage of the total value of the assets based on the passbook savings rate, as determined by the U.S. Department of Housing & Urban Development (HUD) each year. The PHA will never count the full cash value of the asset toward annual income."
- HUD, "Housing Choice Voucher Program Guidebook", Chapter 5: Eligibility and Denial of Assistance, p.5-24. January 10, 2008 version. "Calculation When Assets Exceed $5,000: When net family assets are $5,000 or less, use the actual income from assets. When family assets are more than $5,000, use the greater of: Actual income from assets; or A percentage of the value of such assets based upon the current passbook savings rate as established by HUD. This is called imputed income from assets."
- "Passbook Savings Rate - Section 8"
- HUD, "Public Housing Occupancy Guidebook". "Public Housing Passbook Savings Rate" Another conforming change is related to the passbook savings rate. The Public Housing Occupancy Guidebook suggests that PHAs use a new rate of 2% to be consistent with Multi-Family Housing's passbook savings rate policy. However, as the Office of Housing is updating the passbook savings rate, therefore, PHAs should continue to implement PIH's current policy regarding the passbook savings rate until further notice."
- "SCHEDULE B - FY 2012 Final FAIR MARKET RENTS FOR EXISTING HOUSING", HUD
- See Part B, 6(a), of Housing Assistance Payments Contract (HAP) Contract Section 8 Tenant-Based Assistance Housing Choice Voucher Program
- "Landlord Key To DCHA Section 8 Voucher Program", Dane County Housing Authority, Monona, Wisconsin.
- "DC Human Rights Act of 1977" Subchapter 2 Part C: Housing and Commercial Spaces the document states: 'It shall be an unlawful discriminatory practice to do any of the following acts, wholly or partially for a discriminatory reason based on the actual or perceived...source of income.' Government assistance such as vouchers are considered a source of income.
- Other PHAs will award a spot on the wait list to all who apply as long as the wait list is open, with vouchers being awarded in the order applications are received. "Co Co County Housing Office Flooded with Section 8 Apps: Too many people need help with housing in East Bay county", NBC Bay Area, Tuesday, Nov 4, 2008
- HUD, "Admission and Occupancy FAQ Frequently Asked Questions : Treatment of Income (24 CFR 5.609)"
- Jordan, Melanie, "Rent Freeze Basics for Public and Subsidized Housing Tenants Who Go to Work: A Guide for Mass. Community Service Providers Resource Guide 11", Institute for Community Inclusion (ICI), University of Massachusetts Boston and Children's Hospital Boston, January 2007
- "DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT : 24 CFR Parts 5, 92, 200, 236, 574, 582, 583, 891, 982 Docket No. FR–4608–F–02 RIN 2501–AC72 : Determining Adjusted Income in HUD Programs Serving Persons with Disabilities: Requiring Mandatory Deductions for Certain Expenses", Federal Register, v.66, no.13, Friday, January 19, 2001.
- Howard Husock, America's Trillion-Dollar Housing Mistake: The Failure of American Housing Policy (Chicago: Ivan R. Dee, 2003), 50-58.
- Rosin, Hanna, "American Murder Mystery", The Atlantic, July/August 2008
- Hanna Rosin, "American Murder Mystery," in The Best American Crime Reporting 2009, eds. Otto Penzler & Thomas H. Cook, 249-276 (New York: HarperCollins, 2009), 255-256.
- Victoria Schlesinger, "Section 8 Tenants Unwelcome", California Lawyer, July 2012.
- Greg Anrig and Harold Pollack, "False Accusation," The American Prospect, 30 July 2008.
- Ingrid, Gould, Lens, Michael, O’Regan, Katherine " Memphis Murder Mystery Revisited: Do Housing Voucher Households Cause Crime? ", Furman Center for Real Estate and Urban Policy, September 2011
- Clark, Krissy, "Putting Out the 'Not Welcome' Mat", The California Report, July 22, 2011
- Fernandez, Manny, "Bias Is Seen as Landlords Bar Vouchers", The New York Times, October 30, 2007
- HUD, "Section 8 Tenant-Based Housing Assistance: A Look Back After 30 Years", March 2000.
- Office of Housing Choice Vouchers official website
- Non-profit Nationwide Rental Assistance Programs
- "Homeownership", HUD.gov.
- "Video | How Section Housing 8 Works", Section 8 Housing Choice Voucher Program
- "Video | How to Apply for Section 8 Housing", Section 8 Housing Choice Voucher Program
- Housing Assistance Payments Contract (HAP) Contract Section 8 Tenant-Based Assistance Housing Choice Voucher Program