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Friday, April 20, 2012

The Use of Discretionary Authority in the Housing Choice Voucher Program: A CRS Study

Maggie McCarty
Specialist in Housing Policy

Carmen Brick
Presidential Management Fellow

The Section 8 Housing Choice Voucher (HCV) program is the federal government’s largest needs-based housing assistance program, in terms of both the number of families served and the cost to the federal budget. Under the program, the Department of Housing and Urban Development (HUD) provides funds to local public housing authorities (PHAs), which, in turn, provide subsidies to low-income households to use to rent private market apartments. Although the basic structure of the program is governed by federal law and regulations, PHAs have discretion to determine many important elements. How PHAs use their discretion has implications for how families experience the program, how local communities perceive the program, and the program’s cost.

Little comprehensive information is available about how PHAs use their discretion under the HCV program. Thus, to gain insight that might be useful to Congress, CRS conducted a study that looked at a representative sample of PHAs. Data for the study were taken from the administrative plans that PHAs are required to produce. To supplement information from the plans, interviews were conducted with a subsample of PHA officials. Where possible, results of the CRS study were compared to a study conducted by HUD in 2000. The findings of this study may be relevant to policymakers as they consider HCV reform proposals. 

Major Findings 

         Almost all PHAs (96%) use local preferences (i.e., specified categories of families) to rank families on waiting lists for assistance. This is a change from 2000, when only about 59% of PHAs used local preferences. 
         All PHAs have policies that consider a family’s prior criminal activity and most consider a family’s prior unmet financial obligations when evaluating eligibility for assistance. The policies vary in terms of what PHAs look for (types of crime, evidence) and how far back they look. Most PHAs have also adopted policies that allow them to evaluate families on a case-by-case basis. PHAs use similar policies to terminate assistance for criminal activity. 
         Most PHAs (79%) have adopted a minimum rent of more than $0 per month, and the majority (70%) have adopted the maximum allowable minimum rent ($50). Some PHA officials said they saw minimum rents as promoting fairness; cost savings were not generally mentioned. 
         Most PHAs require families to report all changes in income between annual recertfications, but most PHAs do not adjust families’ subsidies at that time unless the income increase is above a certain threshold. In interviews, some PHA officials said that the administrative hassle of recalculating subsidies was not worth the savings, but some noted that a recent verification system required by HUD had led them to recertify more frequently than they had been previously. 
         It is commonly understood that most PHAs have long waiting lists and many PHAs have closed their waiting lists to new applicants. When opening their waiting lists, the majority of PHAs (77%) determine who is added based on the date and time the application was submitted. About 18% of PHAs use a random selection method. In interviews, several PHA officials noted that they found it challenging to manage the process of opening their waiting lists because of an overwhelming demand for vouchers. 
         Once a family is selected from the waiting list, it has a limited time in which to use its voucher. Most PHAs provide families with the statutory minimum of 60 days of initial search time, although most also allow families an extension to 120 days without requiring the families to meet other conditions (such as being elderly or having a disability). 
         While PHA administrative plans must be made publicly available, it was difficult for CRS to obtain copies of the plans in several cases. 
         Most PHA officials who were interviewed saw their plans as program guidebooks, which is a different purpose than that envisioned by HUD. 
         It appears that many PHAs have purchased their administrative plans from private companies. Based on CRS interviews with PHA officials, it seems that some PHAs perceive their discretionary authority as being limited to the options provided in the purchased plans, or they are unaware of the full discretionary authority that they have.

Date of Report: April 11, 2012
Number of Pages: 45
Order Number: R42481
Price: $29.95

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