HUD May Pull Section 8 Vouchers From ARHA

HUD May Pull Section 8 Vouchers From ARHA

August 22, 2002

More than 300 Alexandria families could become socially invisible victims of a governmental bureaucratic standoff.

Alexandria Housing and Redevelopment Authority (ARHA) is in danger of losing 368 Section 8 Housing vouchers because it has failed to reach a 95-percent utilization threshold set by the U.S. Department of Housing and Urban Development (HUD).

"Although we have sent them a number of letters on this matter, ARHA has not used more than 80 percent of their vouchers for the past several years," said Jerry Brown, HUD public affairs officer. "We feel we can make better use of the vouchers in other areas."

Out of the 3,400 housing authorities nationwide, only 150 have failed to meet the HUD requirement of reaching 95-percent utilization over a two-budget-cycle time frame. "We will not be funding unused vouchers," Brown confirmed.

In a recent letter to ARHA executive director William Dearman, HUD stated, "Because your agency was identified as not having met 95-percent utilization by the second budget submission, your agency may be subject to reallocation. The purpose of this letter ... is to request written validation of your most recent utilization rate for the voucher program."

Brown explained, "We are just recapturing unused funds so that we can make the best use of these moneys. If Alexandria comes up with innovative approaches or a building boom, we would be willing to consider new funding for their vouchers."

Mary Ish, ARHA's director of Housing Operations, maintains that ARHA is caught in a Catch-22 due to the lack of affordable housing in Alexandria, coupled with the procedure known as "absorption" by other housing agencies, when Section 8 voucher holders find housing in their jurisdiction.

ONE OF THE pluses to Section 8 vouchers is that they are portable. When a family from Alexandria becomes eligible for such a voucher. it can use it anywhere in the United States. However, if the family finds housing in another jurisdiction, which also has not reached the HUD threshold, that jurisdiction is likely to give the family one of their vouchers and have the original one returned to Alexandria.

This increases the new jurisdiction's numbers and penalizes Alexandria, according to Ish. "This is known as absorption. The original voucher rolls back to Alexandria, and all our work in helping this family goes for naught. We have had at least 140 to 150 cases like this just this year," she insisted.

"We have 600 vouchers out on the street with people looking for appropriate housing, another 70 set aside under the court's family unification program, 25 dedicated to the mental-health program geared to train families to live independently, and 20 waiting for use by Samuel Maddon Homes residents to choose new housing," Ish explained.

"There is less than a 1-percent vacancy rate in Alexandria, and landlords are very reluctant to accept Section 8 vouchers. Also, Alexandria is very short on rental housing with more than one or two bedrooms," she emphasized.

"On top of this there are financial limitations. A Section 8 voucher family is required not to spend more than 40 percent of their income on housing at the initial lease. And, that includes utilities," Ish exclaimed

"THE AVERAGE Section 8 family income is about $12,000 to $13,000 per year. This compares with a non-Section 8 average family income for Alexandria of $91,500. Private families have no limit on rent expenditures. That is why they are much more attractive to landlords," she emphasized.

When these points were put to Brown, he argued that Alexandria and other jurisdictions, faced with similar dilemmas, had to be more innovative. "There are a lot of creative uses for Section 8 vouchers. They are not limited to rental use," he explained.

"There are some very creative approaches to home ownership through the program. Danville, Va., is a leading area in using vouchers for home ownership."

He also noted that New York City, one of the highest cost-of-living areas in the nation, had used all its vouchers, plus some. "However, they do have rent controls, and this does impact the situation somewhat," Brown conceded.

Ish agreed, "You can create affordable housing by creative uses of Section 8 vouchers. It's been done before. But we need to approach this on a regional basis," she said. Ish would like to see HUD call a regional summit to address all the issues in this area, particularly the issue of absorption.

"If HUD really wanted to be fair about this, they would call a regional summit. That way we can all bring these concerns to the national office," she said.

ARHA COMMISSIONER Shirley Marshall, who has raised the Section 8 voucher question at many meetings since she joined the Board, acknowledged, "It's a very, very difficult and fluid situation. The need is obvious, but the market situation is also obvious."

She noted, "On the one hand the HUD position is understandable, since it is their responsibility to help people in other places as well. I haven't really seen any alternative solution that makes a lot of sense.

"All housing agencies in Northern Virginia have been looking for creative ways to utilize their vouchers. The regional approach is always beneficial but also extremely difficult, just like everything else here, with all these layers of government."

Marshall emphasized, "As an ARHA commissioner, I am enormously concerned. Particularly, as to what this means for the future."

This concern was echoed by ARHA Commissioner Carter Fleming. "We are very disappointed that HUD has taken this hard line approach in light of the fact that the staff had just recently met with them to spell out our concerns and problems."

She expressed the hope that "HUD will be willing to continue to work with Alexandria due to the tight housing conditions in the area. We hope they will reconsider."

Carlyle C. Ring Jr., vice chair of the ARHA Board of Commissioners, stated, "As long as the market remains this tight, it's going to be a tough job to sell landlords on this program. We have been working very hard to get more landlords involved. But we very much want to retain our vouchers."

Ish stressed, "We still have 1,500 people on our Section 8 voucher waiting list and 500 on our public housing list. We have sent additional information to HUD. We are waiting for their response."

Even Brown admitted there are a number of variables that must be taken into consideration when redistributing the vouchers. "It's not just a matter of housing availability. There are other elements involved, such as proximity to jobs, availability of public transportation, schools, medical facilities and other factors.

"Ultimately, we are just trying to recapture unused funds. We get criticized if the funds are not used, and we get criticized when we try to correct that situation. Our job is to make the program work for the most people," he concluded.