January 24, 2003
Senate Housing Voucher Plan Would Protect Low-Income Families And Result in Sounder Program Budgeting
by Barbara Sard and Will Fischer
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The omnibus appropriations bill that the Senate approved on January 23, 2003 (H.J. Res. 2) includes provisions that would establish a new funding structure for the Housing Choice Voucher Program for fiscal year 2003. The House Appropriations Committee passed a bill (H.R. 5605) containing an alternative funding proposal on October 9, 2002.
Housing Choice Vouchers (sometimes referred to as Section 8 vouchers) enable recipients to obtain decent housing while typically paying 30 percent of their income in rent. Vouchers are widely considered to be a highly effective form of housing assistance. For example, the bi-partisan, Congressionally-chartered Millennial Housing Commission concluded in a recent report that the housing voucher program is flexible, cost-effective, and successful in its mission, and should be a linchpin of national housing policy.
The conference committee that meets in the coming weeks to draft a final appropriations bill will face a choice between the two very different proposals for funding the voucher program that are contained in the House and Senate bills. For the following reasons, the Senate bill offers a sounder approach:
- The Senate bill would maintain the federal governments longstanding commitment to fund all existing housing vouchers. The House bill, by contrast, would eliminate approximately 125,000 vouchers that would otherwise have been made available to low-income households struggling to find affordable housing. This cut the first such reduction in the history of the voucher program would occur at a time when the need for housing assistance is large and there are long and growing waiting lists for voucher assistance in many communities.
- The budgeting system established by the Senate bill would make it less likely than under the House bill or past practices that the voucher program would be either overfunded or underfunded. The Senate bill provides a funding level for existing housing vouchers ($12.1 billion) that is between the level provided in the House bill ($11.7 billion) and the level provided in both the Administrations budget for fiscal year 2003 and the original appropriations bill passed by the Senate Appropriations Committee in July 2002 ($12.5 billion). The intermediate level provided in the new Senate bill offers substantial savings compared to the Administrations budget and appears to reflect a more realistic estimate of the amount of funding the voucher program would actually need than either the Administrations budget or the House bill. Furthermore, the Senate bill contains new provisions that would enable the voucher program to accommodate cost shifts that occur due to changes in housing market conditions or other factors that cannot be foreseen at the beginning of the fiscal year.
- The Senate bill would require the prompt transfer of vouchers from local housing agencies that have been unable to use them to agencies that can. Some local housing agencies have been chronically unable to use large numbers of the vouchers they are authorized to administer, while others use all or nearly all of their vouchers and have long waiting lists for voucher assistance. HUD has established a system for reallocating unused vouchers to agencies that can use them to serve additional families, but has not implemented this system effectively and has transferred only a very small number of vouchers. The Senate bill would require HUD to reallocate additional vouchers within five months of the date the bill is enacted. The Senate bill also takes other steps to strengthen the current reallocation system, making it more likely that vouchers authorized by Congress will reach families they were intended to serve.
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