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Alternative Sought to HUD Section 8 Reform Approach
As an alternative to a legislative proposal by the Administration to reform Section 8 vouchers by delegating responsibility for the program to local housing authorities or other state housing entities through federal block grants, NAHB President David Pressly last week invited Department of Housing and Urban Development Secretary Alphonso Jackson to work with the association to pursue streamlining and other improvements within the program’s existing structure.
“While NAHB continues to disagree with the approach to reform taken in The State and Local Government Housing Flexibility Act, H.R. 1999, our members would like to work with you, members of Congress and our industry colleagues in developing alternatives to current practices that will result in a more streamlined and efficient program,” Pressly wrote to the secretary on May 23.
Seeking support for H.R. 1999, Secretary Jackson on May 11 addressed NAHB members who were in Washington, D.C. to attend the association’s spring board meeting and asked them to consider a new approach to Section 8 that would allow local housing authorities to reduce the program’s costs by setting time limits for residents and permitting higher income households to participate in the program.
“If we do not want the Section 8 program to continue to eat at the heart of HUD, we need legislation to change it,” Jackson told the special NAHB session. Section 8 was originally established to provide transitional housing, Jackson said, but those using vouchers today are staying an average of eight years in the program, compared to three or three-and-a-half years before 1998. Three out of five households in the program are required to have 30% or less of area median income, they have no incentive “to move up the economic ladder” and the waiting list for eligible Section 8 renters is 10 years long, he added.
The cost of the Section 8 program, which is the principal source of federal rental assistance, has grown considerably in recent years and now claims a majority share of the HUD budget. Since HUD is not likely to garner additional federal funding in the years ahead, continuing the current program unchanged could result in cuts to other HUD operations such as HOME and Community Development Block Grants.
At its meeting last spring, the NAHB Board of Directors adopted policy opposing the Administration’s approach to Section 8 reform and emphasizing the importance of maintaining a national policy framework to ensure broad-based implementation of best practices and that national policies are carried out fairly and uniformly.
“NAHB has serious concerns that a block grant approach will pave the way to future reductions in federal funding, leaving states to find alternative sources of money to run their programs,” the association stated last May during hearings on H.R. 1999 by the Housing and Community Opportunity Subcommittee of the House Committee on Financial Services. “Further, NAHB is concerned that the block grant approach would create a confusing, and even conflicting, array of program requirements and standards across the country.”
H.R. 1999 has not received the congressional and public support it needs to move forward, and there has been no action on a companion bill in the Senate.
Ney Bill Focuses on Streamlining
In the meantime, Rep. Bob Ney has introduced a new Section 8 reform bill, H.R. 5443, which he said he intended to move shortly after the Memorial Day recess.
H.R. 5443 is narrowly focused on streamlining several aspects of the existing Section 8 program.
Of interest to NAHB members, the bill would significantly streamline the process for inspecting units for compliance with Housing Quality Standards (HQS). For example, units being vacated by a voucher family would not have to be re-inspected before the next eligible family could move in if the unit had been found to meet the HQS standards during an inspection within the previous 12 months. The same would apply for previous inspections within 12 months under another federal, state or local housing assistance program. NAHB policy supports this provision.
H.R. 5443 also contains some changes in determining income eligibility and allows local housing authorities to require recertification of incomes for families on fixed incomes every three years instead of annually.
The bill would also allow HUD to approve up to 40 local housing authorities that meet certain criteria to participate in the Moving to Work program, which enables them to combine funding for public housing and the voucher program, as well as to relax certain program requirements in order to meet specific goals.
H.R. 5443 will be sent to the full Financial Services Committee for consideration after it is marked up in subcommittee, but with the number of legislative days left in the 2006 congressional calendar dwindling fast, its fate is uncertain.
To read legislation, click here and enter the bill number in the box at the center fo the page.
For more information, e-mail Claudia Kedda at NAHB, or call her at 800-368-5242 x8352.
Photos by Herman Farrer
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