July 2, 2014
Vol: 21 No: 27

News

The shock doctrine

By Aaron Burkhalter / Staff Reporter

To free up public housing for the thousands in line for it, Seattle Housing Authority to take a tough-love approach to tenants

Tenants in SHA-managed apartments, such as Yesler Terrace, pay 30 percent of their income for rent. Under a new structure being considered, the rate will increase depending on how long renters stay in their apartments.

Photo by Sophie Bonomi

SHA is planning to have public meetings for tenants over the summer to collect more information before deciding whether to change the rent structure for public housing.

Photo by Sophie Bonomi

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The rent is going up, even for those who earn the least.

The Seattle Housing Authority (SHA) is poised to hike rents in its apartment buildings and require those who use Section 8 vouchers to pay more for their housing.

Under the current system, tenants pay 30 percent of their income on rent and utilities. Under a new rent structure now being considered by SHA, a tenant who is not elderly or disabled will pay a rent based on how long they’ve been in the apartment and the size of the apartment.

In this new system, tenants will see their rent increase every couple of years, until it finally reaches a cap. That cap will be below market rate, but rents will still be higher than they are today.

In changing its rent structure, SHA is recasting the role of public housing. Once a permanent safety net for Seattle’s poorest people, SHA’s apartments could function more like a stop on the way to the open housing market.

SHA officials say the proposed rental structure — the actual rents and timelines have not yet been released — will help move into housing the thousands of people languishing for years on waiting lists. At the same time, it would improve current residents’ financial status and graduate them to market-rate housing.

It’s a test for the system — and the people in it.

“We believe [residents] will be successful in securing those living wage jobs,” SHA Executive Director Andrew Lofton said. “If they don’t, they will have a very difficult time in our housing and in paying their rent.”

Critics of the plan say it will only push people through the housing system faster, without improving their financial status. Their replacements in public housing will also eventually face the same hardship.

“They’re going to be cycling people through the program into an unaffordable housing market,” said Jonathan Grant, executive director of the Tenants Union of Washington State. “This creates incredible instability in people’s lives.”


National trend

Around the nation, housing authorities are putting tighter restrictions and expectations on their tenants.

Most of the 3,400 housing authorities in the U.S. must charge tenants

30 percent of their income. But in 1996, the U.S. Department of Housing and Urban Development formed Moving to Work, a program that allows a small slice of housing authorities across the country to experiment with rental systems to find more effective ways to help people move off public housing.

The 39 Moving to Work housing authorities — including the housing authorities in King County, Tacoma and Seattle — are allowed to change their systems in the name of experimentation. Their results are expected to help inform Congressional reform of the nation’s public housing.

Some housing authorities have taken a harder line than SHA, setting term limits on tenants. The Tacoma Housing Authority allows people to stay in public housing or Section 8 housing for five years before they have to move on, excepting senior and disabled residents.

Others charge higher rent and put a portion of the money into a savings account clients can access when they move out of public housing. In another approach, tenants who increase their earnings are allowed to pay the same rent for a few years so that they can amass some savings.

SHA has experimented with a few of these programs but scrapped most because they were expensive or did not help residents significantly, according to Andria Lazaga, SHA asset management coordinator.

Now, the decline of federal funding has forced the agency to take a stronger tack. Following the Great Recession of 2008, housing authorities face more demand than ever, while government dollars to support them have fallen away, Lofton said.

SHA has cut $16.3 million from its programs since 2011. SHA also expects to get less money from the federal government each year — an average reduction of $12.5 million a year over the next decade. In 2014, SHA’s budget was $172.8 million.

SHA provides Section 8 housing vouchers to about 9,000 households and provides apartments in SHA-owned buildings to 5,900 people.

There are 9,300 people waiting to get into buildings owned by SHA. To get Section 8 vouchers, people have to enter a lottery to make the waiting list. SHA last opened the waiting list in 2013 and received 24,000 applications for 2,000 spots.

The average person affected by the rent change has lived in SHA housing for 8 years. About 25 percent of this population stays in the system for more than 10 years.


Job training

In the new rental structure, SHA will assess every resident to determine what they need to improve their employment, whether it’s training, English language lessons or internships.

SHA does not require that people participate in employment programs, but will help anyone who is willing to try.

If the training is a carrot, the rising rents are a stick. At first people will have a low rent, affordable to someone working a part-time job at the state’s minimum wage of $9.32 an hour. In a few years, the rent will go up, so that it is affordable to someone working a full-time, minimum wage job. At the high end, Lofton said, rents will be affordable to someone earning $12 an hour in a full-time job.

SHA has not released a specific rental structure or timeline. More information will be publicly available after July 4.

SHA says tenants have untapped earning potential. Some simply lack adequate training or experience, while others are avoiding education and promotions for fear that increased earnings would cause their rent to go up.

SHA hired consultant Annie Armstrong to interview tenants about their employment and education. Of the 161 residents Armstrong interviewed, 39 said they had avoided career advancement opportunities, concerned that it could impact their rent.

“They wanted jobs, they wanted ESL training that was linked to work,” Armstrong said. “They wanted to do things, but the incentives were not there.”


Untested approach

While designed to address the problem of long waiting lists for housing, SHA’s approach risks exacerbating the circumstances of public housing’s most vulnerable tenants, skeptics say.

“On the one hand, it reaches more people because you’re moving more people through the system,” said Will Fischer, senior policy analyst at the Center on Budget and Policy Priorities, a Washington, D.C.-based think-tank that studies poverty. “The other side of it is that maybe with this kind of approach, you lose people who need assistance the most.”

It’s also unclear whether Move to Work tactics are successful.

“There’s been a fair amount of experimentation, but it hasn’t generated much information on what works and what doesn’t,” he said.

Others say it’s wrong to assume that SHA residents aren’t already looking for work or advancing their career.

“That’s based on the premise that these people aren’t looking hard enough and that the jobs are there,” Seattle City Councilmember Nick Licata said. “The jobs for these folks are miniscule.”

Some see SHA’s new approach as a failure to deliver on its mission.

“I do not think this policy is addressing the root cause of the affordable housing problem,” said Grant of the Tenants Union. “Is this policy going to be providing more affordable housing for folks? The answer is, no, it’s not.”

SHA is planning to have public meetings for tenants over the summer to collect more information before deciding whether to proceed with the program. The decision falls to the SHA Board of Directors.

SHA Board Chair Nora Gibson said the seven-member body does not yet know enough to make a final decision or comment on the proposal.

She conceded that it will likely be better for people waiting for housing than current tenants.

“I don’t think any approach we adopt will be popular with current tenants,” Gibson said. “Talking with people on the waiting list, they just want housing and they don’t have it.”

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Comments

shortage of revenues might the Board consider raising the % of rent collected to 35%. More stressful on families to if permanent housing become "transitional" in a high cost county and city.

Robin Amadon | submitted on 07/06/2014, 8:37am


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