Affordable Housing—For Whom?

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Billions of federal, state and local dollars were spent on affordable housing for low income people last year. Yet 2.5 million children in the nation were homeless. Close to 700 of them were right here in Champaign County.

Most “affordable housing” dollars are spent to help people other than the poor. Funding for programs involving home ownership or new construction of multi-family complexes is favored over the one type of housing assistance that reaches the most needy households: rent subsidy.

The U.S. Department of Housing and Urban Development (HUD) defines “low income” as 80 percent of median area family income. For a family of three in Champaign County, that’s $57,250. While far from being rich, that family earns enough to afford $1400 per month for rent and utilities. Programs to help these families are called “affordable housing.”

HUD defines “very low income” as 50 percent of median income, or $35,800 for a family of three. This is the affordability standard for the tax-credit housing complexes for “low income” households—places like Crystal View Townhomes in Urbana and Bristol Place in Champaign. Rent and utilities for a two-bedroom unit must be kept under $895 to meet the “very low income” standard.

A minimum-wage earner who is the sole support of the family would have to work 72 hours a week to afford a two-bedroom apartment that rents for $895. How does a single mother swing that?

The poverty level for a single mother with two children is $21,300. That’s enough income to afford $532 per month for rent and utilities. If she works fewer than 45 hours a week at a minimum wage job, her income is below the poverty level and she can’t even afford $500 monthly. The cheapest two-bedroom apartments in the two cities cost more than that.

Rent subsidy, commonly referred to as “Section 8,” is the only affordable housing strategy for extremely low-income households. The total amount of money spent on rent subsidies in Champaign County meets only 20 percent of the need.

2700 individuals in Champaign County under the age of 65 whose sole source of income is Social Security Supplemental Income (SSI) receive $731-$771 monthly. That means that each can afford no more than $230 per month for rent and utilities—less than half the cost of renting a room in someone else’s apartment.

People with disabilities whose sole source of income is SSI are either severely rent burdened or homeless—except for the few who can get a rent subsidy.

The Regional Office of Education reports close to 600 school children in Champaign County were homeless during the last school year. This number does not include children ages 0-5 who are homeless but not counted by the schools. They all need a rent subsidy.

More than 5200 households applied to the Housing Authority of Champaign County (HACC) for a tenant-based rent subsidy during a six-week period that the waiting list was open last summer. It opens only once every few years.

With so many applicants, HACC conducted a lottery to select 1500 of the 5,200 applicants to be placed on the waiting list. Everyone else is—sorry!—out of luck. Only a few hundred of those 1500 will ever get assistance. They have to wait until a current program participant loses or surrenders her/his rent subsidy.

The waiting list for 60 apartments at the new Bristol Place development on Bradley and Market opened for just one day on August 6. More than 600 applications were submitted on that one day.

The total number of households in Champaign County receiving some type of rent subsidy from HACC is 1,930. The number of households on HACC’s lists who are waiting for a subsidy is 2,042. The number of applicants who weren’t able to even get on waiting lists is greater than 4,000.

It’s important to understand that none of the new housing development in the last twenty-five years has created affordable housing for SSI recipients, single mothers with minimum wage jobs, or anyone else who needs a rent subsidy because their income is below the poverty level.

All of the extremely low-income people who live in tax credit housing complexes also receive a rent subsidy. Each rent subsidy assigned to a unit at a tax-credit complex comes from the funds HACC already has for subsidies.  Therefore, an increase in the number of project-based subsidies (assigned to a tax-credit unit) is matched by an equal decrease in the number of tenant-based subsidies (formerly called Section 8 and now called “Housing Choice Voucher”).

The Housing Authority could partner with private developers to create another 100 tax-credit units that have a subsidy, but the total 1,930 households served annually would not change. The only way to increase that number is for HACC to get more money for more rent subsidies.

HACC has started developing tax-credit apartment complexes in other counties, and has committed to assign 41 rent subsidies from Champaign County to apartments in Robinson, Newton, Ladd and Henry, Illinois. HACC says that its role in developing these projects will bring revenue back to HACC for its programs.

Which programs? Will the revenue from HACC’s investment 100 miles away be enough to create 41 more rent subsidies here? Regardless of the amount, will HACC designate the revenue from those projects to creating more rent subsidies here?

HACC’s 2020 “Moving to Work Plan” states that the agency has committed the 41 subsidies to specific projects, and will continue to pursue the development of more housing in under-served rural areas outside of Champaign County. No limit on the number of units is stated in the plan. The Plan also does not state how the revenue from this out-of-county development will be used by HACC.

The Board of Commissioners of HACC is appointed by local governments to oversee the agency’s use of millions of public dollars for affordable housing programs. The Board holds public meetings at 3:00 p.m. on the fourth Thursday of each month (although this sometimes changes, so check their website at Meetings are also aired on UPTV. Very few members of the public watch what HACC does. It’s time more people start.

People who believe that any revenue HACC receives from out-of-county development should be used to increase the number of households receiving subsidies in our county need to tell the commissioners.

Rent subsidy should be an entitlement program like food stamps (now called SNAP). Everyone who needs a rent subsidy to bridge the difference between 30 percent of their household income and modest rent should get one.

That’s not going to happen any time soon, so, at the very least, whatever limited resources are available in our county for “affordable housing” should be devoted to rent subsidy for individuals and families whose incomes are below the poverty level.

Esther Patt is a member of the Steering Committee and past president of Champaign County chapter of the American Civil Liberties Union. She has been an activist for tenants’ rights for over 40 years.

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