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Using Section 8 to Co-Locate Affordable Housing and Good Schools

Adam Rust's picture

Posted February 22, 2010

My comments on how the location of affordable housing can help to determine the diversity of the student populations in local schools elicited some interesting responses.  I say interesting because there less about "agree" or "disagree" or more about how policy is working or not working.

I would like to identify the author of one set of comments, but for now I will just acknowledge that she is a Realtor from the Bay Area (we'll call her "Bay Area Realtor").  She makes some great policy points:

  • Statewide efforts at inclusionary zoning have been in place for years, but they do not seem to be working or at least they are not realizing outcomes that would prevent writers like myself or Fordham from finding fault about California or Massachusetts.
  • A community might be concerned about a lack of available housing for lower-income populations, but if they do not have any available land, then there is little that can be done. The author points out that Piedmont has been built out for decades.
  • The age of housing influences its affordability.  New housing imposes higher upfront costs, older housing brings higher ongoing costs.  New housing must meet the standards of new building codes.  There are requirements in California to build to higher seismic codes, to pay more for new public infrastructure.  On the other hand, maintenance costs on older properties are often higher.  This is a wrinkle that plays out not just on a house-by-house basis, but also on entire communities.  Some places have lots of new housing, and others (like Piedmont or Shaker Heights, Ohio) have a greater share of older housing.

I think the last point tells us that housing affordability is not merely about rent. It doesn't help to put a poor household in a low-rent home if they are then facing high utility bills every month.

The place where policy could address that contradiction is through the Housing Choice Voucher Program (Section 8).

County Policy

Section 8 provides rental housing for low-income households through partnerships with private landlords. It uses

tenant choice.  Tenants pick their housing and Section 8 picks up most, if not all, of the rent.  By incorporating personal preference into the system, HUD avoids the kinds of problems that plague public housing.  Tenants can find housing in most parts of a community.  They can have a say over where their kids go to school, over how close they live to work, or over what amenities that want to have in their neighborhood.   The system also increases the chance that the properties will be kept up, compared to the established record of neglect that has characterized public housing.  Tenants can also be held accountable.  If they fail to pay their share of rent, or if they damage their housing, they can lose their voucher.  For many families, a Section 8 voucher is their greatest asset.

We want Section 8 to give residents a shot at living in all kinds of communities.  Presumably, if Section 8 tenants can find a spot in both new housing (where fixed costs might predict high rents) or in older communities (where deferred maintenance might mean lower rents but higher maintenance costs) then they will have more choice over more places.

There are many places where Section 8 could use a fix.  The system of applying fair-market rents across an entire community seems naive, and I'll credit Alameda County for addressing that with its own internal payment standard system that gives different rents to Hayward or Dublin or Newark. HUD itself, courtesy of Bronson v. Crestwood Lake Section 1 Holding Corp., makes it possible for Counties to adjust their fair market rents in order to make high-cost areas affordable for low-income families.  It makes sense, but even so, this policy generates some anger - witness this blistering editorial. The Crestwood decision prompted one judge in New York to give Section 8 voucher holders the right to spend more than 30 percent of their income on rent.  The judge said that the goal was to "obstensibly" find a home in a non-minority area on the east side of Yonkers, New York.  Unfortunately, of the 108 families with the enhanced vouchers, none were able to find a home in the targeted east-Yonkers neighborhoods.

In many instances, price signals on utility bills are not working.

In my community , the local public housing authority encourages Section 8 voucher holders to rent homes heated by electric.  They do that by applying a formula for rents that estimates the cost of electric heat at a lower rate than gas heat. In North Carolina, that makes no sense.  A gas bill should cost less than an electric bill.  Beyond the bill, there's also the issue of carbon impact: in North Carolina, sixty-one percent our electricity comes from coal.

Section 8 has let its signals get crossed.  The end result is that tenants are going to end up in older units with electric water and heat.  It is going to deter landlords from using Section 8, and in turn, it is going to limit the number of schools that tenants can pick from to educate their children.