Section 8 tenants could get more for their vouchers under proposal

Low-income families in Tacoma and Pierce County might soon be able to use their Section 8 voucher to move to neighborhoods with better schools and job opportunities, if a change in federal standards for how subsidies are set in certain metropolitan areas is approved.

Local housing authorities that distribute the vouchers, though, said they are skeptical about whether that will actually help needy renters in an extremely tight rental market with little affordable housing.

Housing and Urban Development has proposed changing the way fair market rents are set for monthly rental vouchers in 31 metropolitan areas with what it calls particularly restrictive housing markets across the country. That list, which includes Tacoma and Pierce County, runs the gamut from major metropolitan areas like New York City, Atlanta and Chicago to smaller cities like Gary, Indiana.

The goal, HUD said, is to deconcentrate poverty and give families in those markets a chance to broaden their neighborhood options. Affordable housing is an issue that’s been top of mind for HUD and local housing authorities: On Tuesday, HUD Deputy Secretary Nani Coloretti will meet with Michael Mirra, executive director of the Tacoma Housing Authority, at the authority’s Salishan development for a discussion about how the region can meet the demand for affordable housing as the population increases.

“What we’re proposing to do is to allow housing authorities where we’ve determined there to be a significant degree of concentration of voucher holders in certain neighborhoods, to allow them to instead set the fair market rent by a smaller area,” said Lee Jones, a spokesman for HUD based in Seattle. “The point here is to try to put the choice back into the Housing Choice Voucher program and give families or households who want the choice to move from high poverty neighborhoods to high opportunity neighborhoods.”

HUD published the proposal last month and is accepting public comments. The rule would change the way it sets fair market rents, transitioning from an areawide standard to one set by ZIP code, so that clients who want to live in a neighborhood where housing is more expensive would get more assistance.

The Housing Choice Voucher program, known more frequently as Section 8, provides a subsidy for very low-income families, the elderly and the disabled to help them find rental housing in the private market. The family or household usually contributes at least 30 percent of its income each month, and the housing authority voucher pays the rest, between 90 to 110 percent of fair market rent. If the rule change is passed, the dollar amount that local housing authorities would pay for the voucher would vary from ZIP code to ZIP code.

It’s a change that would be expensive for the housing authorities and potentially complicated for the renter and the landlord, said Tacoma Housing Authority deputy executive director April Black. Because the housing authority would be compelled to pay more money in a rent voucher for those who want to move to —– and can find housing in — more expensive neighborhoods, they would be able to offer fewer vouchers overall.

“I think it’s a federal response to a problem that they can see through numbers, but I think it’s something that really needs to be addressed locally,” Black said. “A lot of urban markets across the nation are exploding with their rent prices and their vacancy rates going down, so we need to be able to contemplate how to provide people with opportunities to rent where they want to rent, but I don’t think that the answer is the same for every community.”

Fewer vouchers to go around could mean that the amount of time families spend on the waiting list to get one — often months or even years — would increase.

For Tacomans like Pedro Serrano, 62, who has been on the Section 8 waiting list since 2010, the idea of waiting longer is frustrating. Serrano, whose only income is Social Security, said he periodically checks in with the Tacoma Housing Authority to make sure they know he still wants a voucher. He was there last Monday, and Serrano said after leaving the housing authority building that he’d been reassured he was still on the list.

“I’ve been on the waiting list the whole time, and every so often I come in and let them know that I’m still trying to get housing so that they know, so they won’t take me off the list,” Serrano said. “They just take my information, make sure it’s current and tell you just keep waiting.”

Vouchers are hard to come by: Tacoma Housing Authority accepted applications in July 2015 and received more than 9,700 during a two-week opening, Black said. It then did a lottery, placing 1,200 of those applicants on a waiting list.

Black said that, under the federal proposal, the monthly voucher paid in the 98433, 98422 and 98446 ZIP codes would increase the most, with 98433 — which includes the area south of Joint Base Lewis-McChord — topping the chart. The monthly voucher for a 4-bedroom there would go up $794 from what it is now, Black said. Rental vouchers in 98422, which includes Northeast Tacoma, and 98446, which includes parts of Brookdale and Frederickson, would also increase by triple digits each month.

On the other end, in each of 98402, 98465, 98499, the payment for a 4-bedroom would drop by $416 a month, she said: 98402 includes the area near the Tacoma Dome into downtown by the waterfront; 98465 is much of west Tacoma north of South 19th Street and south and west of state Route 16; and 98499 encompasses Lakewood and crosses over Interstate 5 into Joint Base Lewis-McChord.

Right now, the average monthly Section 8 payment by the Tacoma Housing Authority is $588 a month, Black said. The average voucher for a 4-bedroom is $935 per month. Black said they already reassess quarterly to try to keep up with the cost of housing.

“I think that the sentiment in it was good, but I don’t think it’s necessarily going to be a positive change for our participants,” she said. In Tacoma’s extremely tight rental market, she said, “people are already having a hard time finding units. People who are new to our program, only 70 percent of them right now are able to secure housing. The other 30 percent are having to turn the voucher back in because they can’t find anything.”

Mike Herron, 64, is familiar with that struggle. He’s had a Section 8 voucher since 2007, the housing authority said, but said he hasn’t been able to find new housing since moving in May. Herron is retired and his only source of income is his Veterans Administration pension, he said.

“The rents have really gone up,” Herron said, adding that any increase in rent vouchers that the housing authority could provide would help. “Although they help pay for a large portion of it, my income doesn’t let me rent too expensive of a place.”

Based on the housing authority’s assessment, the low vacancy rate in Tacoma means voucher holders are being screened out: Since there’s so much demand, landlords are able to pick and choose, often taking renters with higher incomes, fewer dings on a credit report or with no criminal background (including not just convictions, but arrests, Black said). Landlords who took Section 8 vouchers in times when there were higher vacancy rates, such as shortly after the recession, often don’t take them now, said Pierce County Housing Authority executive director Charlie Gray.

The new method also could be more complex: Many Section 8 participants with a voucher look at several buildings and neighborhoods, and many landlords who accept Section 8 have multiple buildings, Black said. If the voucher varied by ZIP code, it could make it more confusing for both renter and landlord to figure out what voucher amount applies where.

“If we’re adding an additional complicating factor where it’s hard for a landlord to figure out how our program works, I think the success rate for customers trying to lease up on the program will go down,” Black said. “We think that it could potentially have a more negative impact on our customers if the program is perceived as being too complicated to deal with by the landlords.”

An underlying problem is the lack of affordable housing in Tacoma and Pierce County, said Connie Brown, executive director of the Tacoma-Pierce County Affordable Housing Consortium. There are about 10 units of affordable housing for every 100 households living at zero to 30 percent of the median family income in Pierce County.

“The point that we need more affordable housing in Pierce County is really important,” Brown said. “We’re at the bottom of the heap in the state with regard to affordable housing that’s available to really poor people.”

Another potential complication: Unlike in Seattle, unincorporated King County and Tumwater, Section 8 is not considered a protected class in Tacoma or Pierce County. That means that even if a voucher holder gets more money to rent in a more expensive, higher opportunity area, landlords can legally reject them because part of their income comes from Section 8. Postings for apartments on Craigslist will often make the landlord’s position clear: “No Section 8” or “Section 8 welcome” is often included on listings.

Statewide regulation has been proposed for years but has run into opposition from landlords. A run at creating statewide protected status earlier this year for those on Section 8 and other government aid didn’t advance in the Legislature.

Black said the housing authority believes Section 8 voucher holders should be protected. But she and Gray, of the Pierce County Housing Authority, said that’s not the primary barrier right now for low-income families who are trying to find housing.

Gray also said if the change is approved, it could mean fewer vouchers overall, and could make it less likely that clients will choose a cheaper ZIP code if they can possibly get more money to rent somewhere more expensive.

“My concern is that we will sort of cut the bottom out without elevating the top of the fair market rate,” Gray said. “Will the increase in the fair market rate in those high-opportunity areas be sufficient to allow entry? And then, we’ve eliminated some housing options for folks at the other end.”

This story was originally published July 18, 2016 at 2:30 PM with the headline "Section 8 tenants could get more for their vouchers under proposal."