Section 8 Housing Voucher Programs In Crisis

Section 8 Housing Voucher Programs In Crisis

Public Housing Agency's Forced To Terminate Section 8 Contracts

By Lynda Carson May 18, 2004

Oakland CA--The Bush Administration has recently shattered America's 30 year commitment to assist low-income families in keeping a roof over their heads through the HUD funded Section 8 housing voucher programs that assist the disabled, elderly and the poor.

Public Housing Agencies (PHAs) across the nation have been informed that reimbursements from HUD for fiscal year 2004 would not be based on actual current voucher costs, and instead the payments would be based on the cost of vouchers under lease on August 1, 2003, adjusted for inflation.

The announcement sent shockwaves throughout the country when the PHAs discovered that the regulatory changes created huge budget shortfalls for fiscal year 2004, because they would only receive funding at the fiscal year 2003 level.

These disastrous changes went into effect when President Bush signed the current budget into law in January, 2004. On April 22, HUD issued the guidelines spelling out details of the new budget and, public housing agencies across the nation have quickly fallen into a crisis due to the funding shortfalls.

THE CRISIS SPREADS

The crisis has already spread from coast to coast. New York City faces a $55 million shortfall to fully fund 118,000 housing vouchers that are already in use for fiscal year 2004.

A housing agency in Warrenton, Oregon, had to cut off funding for 110 families during the first week of May, 2004. The agency is presently short of $59,000 or more, and another 50 families could be cut from the voucher programs by June 1.

The PHA of Alameda, California, sent out letters on May 14, to 1,659 families and over 600 landlords to inform them that the new regulations created a $3 million shortfall and that there may not be any rent money for the month of June. Tenants and landlords are being advised to use the security deposits to pay the rent and to negotiate a way for the renters to repay back the spent security deposits.

Massachusetts housing officials are set to mail termination notices to about 650 tenants due to a shortage of $550,000, and are working with state and federal officials to come up with a solution to avoid the termination of many housing vouchers in their state.

Minnesota has a voucher crisis and 2,000 families may lose their assistance by June. According to John Gutzmann, an executive of the St. Paul, PHA, his agency alone faces a $30,000 shortfall or more.

The PHA of Fargo, North Dakota, has indicated that they may have to terminate the housing vouchers for 46 out of 1,100 families from their existing housing voucher programs.

Under the current Bush administration's budget proposals, estimates already have been calculated by the Center on Budget and Policy Priorities for fiscal years 2005 through 2009, and it appears that the current disaster taking place is only the tip of an iceberg.

The proposed reductions in voucher subsidies for fiscal year 2005 may result in a huge source of homelessness locally and across the nation for years ahead if the Bush administration's proposals are not reversed.

On a local level, during fiscal year 2005, it's estimated that reductions to Berkeley's housing voucher programs may result in the elimination of 223 families out of 1,841 families unless the city imposes an annual rent increase of $1,545 spread across the board to each of the families using the existing housing vouchers.

In fiscal year 2005, Alameda faces a $2,310,687 funding shortfall for their vouchers in addition to their current crisis, and may have to eliminate 197 families out of 1,625 families or raise the rents for all on an annual basis by $1,392.

Oakland faces a reduction of $17,380,757 for fiscal year 2005 under the current budget proposals, and may be forced to eliminate 1,303 families out of 10,754 families from their voucher programs or raise the rents annually for all by as much as $1,582 per family.

For fiscal year 2005, San Francisco faces a reduction by as much as $15,257,319, and may have to eliminate 876 families out of 7,229 families from it's voucher programs or raise the rents on all families by as much as $2,066 annually.

Richmond faces a shortfall of $2,388,667 in fiscal year 2005 and may have to eliminate 212 families out of 1,750 families from their voucher programs or raise the rents annually by $1,336 per family.

Alameda County faces a shortfall of $8,711,214 to operate it's voucher programs and Contra Costa County faces a shortfall of $9,583,119 to fund their voucher programs in fiscal year 2005.

The City of Los Angeles faces a shortfall of $41,945,319 to fund their vouchers for fiscal year 2005, and the State of California in it's entirety faces a total shortfall of $316,440,144 in fiscal year 2005 to fully fund a total of 294,708 vouchers in use throughout the whole state.

The numbers reveal a staggering amount of hardship to come for the poor, disabled and elderly in California if something is not done to convince the Bush administration to reverse it's malevolent policies.

It was G.W. Bush that claimed to be a compassionate conservative, and at this point in time, one can only wonder what in hell that really means as the war mongerer of the White House brings us visions of torture, death and mass murder from across the seas and around the nation as a direct result of his policies.

Outrage Across The Nation

From across the nation, Congressional Democrats claim that thousands of families could be either forced to pay more money out of their own pockets or lose their housing, and according to House Minority Leader, Nancy Pelosi, she said, "The Bush administration is breaking a 30-year promise to help low-income families, the elderly and the disabled to afford decent, safe housing."

Democrats, housing activists, and advocacy groups argue that HUD is misinterpreting the budget and that voucher costs should be updated every three months so that the cost-of-living increases may be assessed on a continual basis.

In a statement released by the National Leased Housing Association, it reads, "NLHA has voiced its opposition to HUD’s interpretation of the FY04 formula and along with other industry groups is pressing Congress to affirm its intention that all vouchers in use (and authorized) be funded at their current cost."

Ayinde, the Executive Director of Jubilee West, a non-profit housing organization in Oakland, could only describe recent events as a disaster. "Jubilee West has been in existance for 29 years, and presently we have 91 housing units filled with families using the Section 8 vouchers. We have faced one crisis after another through the years, and this latest one is certainly a disaster in the making. At least for now we have not received any notice from the Oakland Housing Authority about the latest funding shortfalls happening around the country. The Section 8 program has been taking hits for years, and the poor always end up paying more out of their pocket every year. The housing authority never comes around to see what our real needs are, and their not really concerned about the low-income renters. Everyone is trying to get rid of the low-income renters. It's time for people to give up hope, and to take action. From the top down, it's obvious that the Federal, State, and local governments only want to serve the well to do. With Bush, Schwarzenegger and Jerry Brown running things, we are all in deep trouble!"

The Consortium for Citizens with Disabilities said in a released statement, "The Bush Administration’s FY 2005 HUD Budget proposal calls for deep cuts in the Section 8 Housing Choice Voucher Program. The budget also would radically alter the fundamental design of the program by converting it to a block grant administered by Public Housing Agencies (PHAs) for the benefit of higher income households. The Consortium for Citizens with Disabilities Housing Task Force (CCD Housing Task Force) is strongly opposed to the Administrations budget proposal which would cut more than $1 billion from current funding levels.  We are also strongly opposed to the Administration’s ill-conceived proposal to convert the program to the Flexible Voucher Program – a block-grant type approach which would eliminate many of the critical protections people with disabilities have under the current Section 8 program."

Assistant Director, Robert Barrer, has been with Berkeley Opportunites for Self Sufficiency (BOSS) for 27 years and said, "I can't imagine what all these people are going to do if they cut back on the voucher programs. This is all beyond depressing! We serve many clients on Section 8, most of our other clients are trying to get on Section 8, and this latest crisis will set back the the housing voucher programs for years to come!" 

In response to the Bush administration's budget cuts, Representative Barney Frank (D-MA) has introduced H.R. 4263 in an effort to resolve the situation, and he already has 85 cosponsors or more supporting the bill. The intention of the bill is to amend the FY04 VA-HUD Appropriations Act, in order to fully fund the Section 8 vouchers as based upon the agency's per unit cost, as originally intended by Congress.

Housing activists are calling on as many people as possible to call their member of Congress at the Capital Switchboard (toll free number) to insist that the cuts to the housing vouchers are totally unacceptable.

Dial 1-888-818-6641 to reach your Congressional Representative.

Housing activists request that you;
1) Insist that HUD must withdraw the April 22 notice changing the way housing vouchers are funded, because the change is leading to funding cuts across the country.
2) Insist that HUD must fully fund all housing vouchers in 2004, as Congress intended.
3) Insist that vouchers are based on their actual cost according to the latest available data.