FOR IMMEDIATE RELEASE:
Revised December 11, 2002

CONTACT: Henry Griggs, CBPP, 202-408-1080
Kim Schaffer, NLIHC, 202-662-1530 x230

HOUSE BILL WOULD CUT 125,000 VOUCHERS FOR LOW-INCOME FAMILIES

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State-specific data

Additional Analyses

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A bill recently approved by the House Appropriations Committee would seriously damage the main federal program that helps low-income families rent housing on the open market, according to the Center on Budget and Policy Priorities. Millions of Americans are already living in inadequate housing or paying too much of their incomes for housing this holiday season. Congress will worsen this situation if it approves the House bill when it returns in January.

"The House bill would harm a program that been proven to be highly effective in meeting the housing needs of low-income families," said Barbara Sard of the Center on Budget and Policy Priorities. "These changes are especially ill-timed in light of the large need for assistance and the impressive improvements that the program has made in recent years."

As shown on the following fact sheet, communities in all parts of the country could expect to lose housing assistance if the changes approved by the Committee on October 9 are adopted. The House FY2003 appropriations bill for HUD and other agencies would cut $938 million from the President’s budget for the housing voucher program. Generally called "Section 8" or, more recently, the Housing Choice Voucher Program, the program provides families with vouchers to defray part of the cost of renting housing on the open market. This reduction would result in the loss of more than 125,000 vouchers below the 2002 level and would break the federal government’s longstanding commitment to renew all existing vouchers.

The bulk of the funding cut in the House bill would come from providing local housing agencies with funds only for the number of vouchers they were using at a point in the past.

This is inadequate because agencies are using a greater share of their vouchers now than in previous years: New findings show that the percentage of housing vouchers in use grew from 91 percent in the previous year to 97 percent currently. (Vouchers go unused if the families that are awarded them are unable to use them to rent housing due to lack of available housing or for some other reason.) This major improvement in voucher program performance reflects a series of reforms made in the program in recent years by Congress, HUD, and local housing agencies.

As the bipartisan, Congressionally-chartered Millennial Housing Commission concluded in a recent report, the voucher program is "flexible, cost-effective, and successful in its mission," and should be a "linchpin" of national housing policy.

Families Face Severe Housing Needs

The federal voucher program is especially important given the tightening housing squeeze on low-income families. Census data show that in 1999 more than five million low-income renter households who did not receive housing assistance either paid more than half of their income for rent and utilities or lived in severely substandard housing. Most of the low-income families (as distinguished from elderly and disabled individuals) that face these severe housing needs are working families.

Across the country on average, full-time workers must earn $14.66 per hour to be able to afford a modest two-bedroom rental home without spending more than 30 percent of their income on rent and utilities, according to the National Low Income Housing Coalition (NLIHC). With the exception of Puerto Rico, there is nowhere in the United States where a person earning the minimum wage could afford to rent even a one-bedroom apartment.

"This threat to the voucher program is without precedent and unconscionable at a time when the need for federal housing assistance is at a record high," said NLIHC President Sheila Crowley.

Congress could protect the low-income families assisted by housing vouchers — and the tens of thousands of additional households on waiting lists for vouchers — by funding the program at the level provided in the President’s budget. In addition, Congress could build on the program’s recent success by enacting further reforms contained in legislation introduced this year by Senator Christopher Bond (R-MO), Senator Paul Sarbanes (D-MD), and Representative Marge Roukema (R-NJ).

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For additional information on the changes approved by the House Appropriations Committee, see House Appropriations Bill Would Jeopardize Access to Housing Vouchers for Low-Income Families, available at <http://www.cbpp.org/10-9-02hous.htm>.


State-Specific Data

This fact sheet estimates the impact that the changes to the voucher program approved by the House Appropriations Committee would have in each of the fifty states.  The fact sheet also contains examples of the estimated number of vouchers that would be lost in particular communities.  Data are available concerning some additional communities in each state that are not listed here.  For information on how these estimates were derived, see the Description of Sources and Methods following the individual state listings.

Alabama Hawaii Michigan North Carolina Utah
Alaska Idaho Minnesota North Dakota Vermont
Arizona Illinois Mississippi Ohio Virginia
Arkansas Indiana Missouri Oklahoma Washington
California Iowa Montana Oregon West Virginia
Colorado Kansas Nebraska Pennsylvania Wisconsin
Connecticut Kentucky Nevada Rhode Island Wyoming
Delaware Louisiana New Hampshire South Carolina  
Florida Maine New Jersey South Dakota  
Georgia Maryland New Mexico Tennessee  
  Massachusetts New York Texas  

Alabama

 Alaska

Arizona

Arkansas

 California

Colorado

Connecticut

Delaware

Florida

Georgia

Hawaii

Idaho

Illinois

 Indiana

Iowa

Kansas

Kentucky

Louisiana

 Maine

 Maryland

Massachusetts

 Michigan

 Minnesota

 Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

 South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming


Description of Sources and Methods

The data in this fact sheet are based on a survey of local housing agencies conducted by the Council of Large Public Housing Agencies, the National Association of Housing and Redevelopment Officials, the National Leased Housing Association, and the Public Housing Authorities Directors Association during October and November 2002.  A total of 344 agencies responded to the survey (out of approximately 2,600 that administer the voucher program).  These agencies administer approximately 36 percent of the total number of housing vouchers available nationally.

Percent of vouchers in use.  The utilization rates reported here represent the percentage of authorized vouchers actually being used by families to help pay their rent, as reported by the local housing agencies that responded to the survey.  Utilization rates fell substantially during the late 1990s, when many parts of the country experienced tight housing markets.  Voucher utilization rates have generally risen since 2001, apparently due to program improvements and looser housing markets that have resulted from the weakening economy.

In some cases, utilization rates reported here are greater than 100 percent. This reflects short-term overuse of vouchers that can result from the practice of “overissuance.” Because not all families that are issued vouchers are able to use them, the voucher program permits local housing agencies to overissue vouchers in the same way that an airline overissues tickets. In other words, if one out of every five families typically is unable to rent housing with the vouchers an agency issues, the agency can issue five vouchers for every four vouchers it has available funds to support. If more families than expected are able to use their vouchers, the agency’s utilization rate may temporarily exceed 100 percent.

Number of vouchers that would be lost.  This fact sheet contains estimates of the total number of vouchers that would be lost in each state under the House bill’s funding formula.  The House bill bases future funding for the voucher program on the average number of vouchers that were in use during a local housing agency's last completed fiscal year.  Because housing agencies have different funding cycles, this funding formula would have different effects on different agencies; in some cases funding would be based on data from the period 5 – 16 months earlier, while in others it would based on two-year old data.  The estimates used here are based on the most recent voucher utilization data available.

It should be noted that the methods used to develop the estimates in this fact sheet are conservative.  The funding provided by the House bill appears to be inadequate to fund even the reduced number of vouchers that we estimate would be eligible for funding under the language of the House bill, and as a result it is likely that further cuts would be necessary.  It is impossible, however, to determine which states would lose additional vouchers beyond the number estimated here, due to insufficient appropriations.

For most states, the estimate of the number of vouchers that would be lost is actually a range between two estimates based on different methodologies.  One of these estimates assumes that the state will lose vouchers at the same rate as the local housing agencies in the state that responded to the survey, while the other assumes that the state would lose vouchers at the rate at which vouchers would be lost across all agencies that responded to the survey nationally.  In the three states where there were no survey responses (Kentucky) or where the responses covered fewer than 1,000 vouchers (Delaware and Montana), the projections are based only on the national rate.  In the one state with only one agency administering housing vouchers, Alaska, information is given solely for the responding agency.  For most states there are examples of the number of vouchers that would be lost in particular communities.  These estimates are derived from the administering agency’s reported current rate of voucher use and total number of vouchers.  For purposes of these estimates, the total number of vouchers in each state is based on HUD data for individual housing agencies from the HUDCAPS system, accessed November 25 -27, 2002, and available at <https://pic.hud.gov/pic/haprofiles/haprofilelist.asp>.

Some of the vouchers that we estimate will be lost in each state are not currently being used.  It is impossible to predict how many of these vouchers would be used in 2003 if Congress maintained the current funding system rather than adopting the methodology in the House bill.  Because voucher use has been rising nationally and demand for housing vouchers far exceeds the supply in every state, all of the vouchers that would be lost under the House bill could be used by the agencies that currently administer them or by other agencies in the state.


* For some local housing agencies, HUD records show that the agency has been allocated a different number of vouchers (in most cases more vouchers) than the agency reported in the survey.  The estimates of loss listed here are based on the number of vouchers reported by the agency.  Communities for which the number of vouchers reported by the agency was substantially different from the number shown by HUD records are marked with an asterisk(*).