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Senate Housing Bill Expands Reach of Self-Sufficiency Program

We’ve noted several areas where the Senate Appropriations Committee-approved bill to fund the Departments of Transportation and Housing and Urban Development (HUD) improves on its House counterpart.  Here’s another:  the Senate bill would enable more families with housing assistance to participate in HUD’s effective but underutilized Family Self-Sufficiency (FSS) program; the House bill wouldn’t.

Under FSS, created in 1990 based on a proposal by the first Bush Administration, participants sign a contract with the public housing agency detailing their plans to acquire educational or vocational training and their interim or longer-term goals, such as getting a job or a higher salary or starting a business.  To complete the program (which generally takes five years), the head of the household must be employed and, if the family receives welfare benefits, each family member must become independent of those benefits and remain so for 12 months.

FSS provides case management services to improve participants’ job prospects and earning potential, such as information on available child care, transportation, credit and money counseling, and educational or training programs in the community.

It also provides escrow accounts into which the housing agency deposits the increased rent that a family pays as its earnings rise.  (Families receiving federal rental assistance generally must pay 30 percent of any rise in their income to the agency in the form of higher rent.)  Families that complete FSS may withdraw funds from these accounts for any purpose; many FSS graduates use their savings to buy a home.  Families that don’t meet the terms of their contract forfeit the funds in the account.

Now, only families assisted by public housing agencies — that is, families living in public housing or assisted with Housing Choice vouchers — are eligible for FSS.  The Senate Transportation-HUD funding bill would broaden the program’s reach by allowing private owners of HUD-assisted properties to offer FSS to their tenants.  (Owners would have to pay for the case management services.)  Roughly 1.2 million low-income families rent modest units from private owners through the Section 8 Project-Based Rental Assistance programs.

We’ve called FSS HUD’s best-kept secret for promoting employment and asset growth.  Congress can help more families participate in this promising program by including the Senate provision in the final funding bill.