News Briefs: Federal government extends $30 million to staunch Section 8 bleeding

Published September 2009 Vol. 13 Issue 8

by Joanne Zuhl
additional reporting by Tim Covi

After housing authorities across the country reported massive shortfalls in funding, the federal government announced in August that it would provide an additional $30 million to people on Section 8 housing assistance.

The Department of Housing and Urban Development, or HUD, funds the Section 8 program through local housing authorities, like the Denver Housing Authority. People eligible for Section 8 housing enter into a lottery for vouchers. If selected, they then find an apartment with a participating landlord.

According to news reports and testimony before Congress, authorities across the country were saying they could no longer afford to provide housing assistance to tenants as the economic downturn overburdened their resources.

As of early August, HUD had already spent $89 million of the $100 million set-aside fund provided annually by Congress to support housing authorities facing increased demand or “unforeseen circumstances.” HUD said the remaining $11 million would go to agencies that are on the verge of terminating housing for many families.

The additional $30 million being made available will go to agencies that are eligible to receive “extraordinary administrative fees” for technical assistance to prevent the termination of families. Such fees include having to pay higher market rents, as well as the cost of lower Section 8 resident turnover (more people are staying on Section 8 than in the past). The funds can also be used to fund vouchers, according to  HUD.

The nation’s 2,400 housing authorities were notified at the start of August that the funds would be available. These agencies had until Aug. 14 to notify HUD that they needed this money to prevent existing voucher terminations. According to Stella Madrid, spokesperson for the Denver Housing Authority, Denver was not eligible for a part of the $30 million. “We did not apply for additional funding. We didn’t believe we were eligible and didn’t meet the application criteria,” she said.

But according to a press release from Senator Michael F. Bennett (D), across the state, Garfield County needed additional funds to maintain housing for 76 residents that were close to losing their Section 8 apartments. In a letter to Sandra B. Henriquez, HUD Assistant Secretary for Public and Indian Housing, Senator Bennet supported a request by the Garfield County Housing Authority for special assistance.

“The economic downturn has been difficult for many Colorado families who work hard every day to make ends meet and keep a roof over their heads,” Bennet said. “This emergency funding from HUD couldn’t have come at a better time for the 76 families in Garfield County who were at risk for losing their homes this year.” he said

In Denver, over 14,000 people applied to the Section 8 housing voucher lottery in February of 2009, Madrid said, and DHA was able to administer 5,756 vouchers for the year. Of those, 1,376 were new vouchers. The majority went to people who were enrolled the previous year.

According to HUD, the funding shortfalls — revealed in May when HUD notified agencies of their 2009 allocations — have impacted about 15 percent of all public housing authorities. HUD says that if it determines that additional funding is needed, it will work with Congress on legislative changes to adjust allocations.

The Section 8 funding system is the subject of a bill now working it’s way through Congress. SEVRA — the Section 8 Voucher Reform Act, includes provisions that would create more flexibility and stability in funding formulas for housing assistance. Advocates say it’s a good move forward, but not enough to correct the problem of wholesale voucher terminations, the complete scope of which is still not known.

“There’s no doubt that some of the policy changes that are contained in the SEVRA bill would help make it less likely that this year’s type of situation would recur in future years, so we strongly support that bill, it will give HUD and housing authorities more flexibility in dealing with problems in the future,” says Jeremy Rosen, executive director of the National Policy and Advocacy Council on Homelessness in Washington D.C. “That said, no amount of flexibility can get around the situation where there isn’t enough money for the program.  The policy changes and SEVRA just by themselves won’t change this problem or fix future problems.”

Reprinted from Street Roots

© Street News Service: