About 21,000 At-Risk Households Across the Country Need Congress' Help to Access Housing Vouchers

About 21,000 at-risk households across the country need Congress’ help to access housing vouchers. The Shriver Center is working with a coalition of advocates, including the Chicago Housing Initiative, on a federal housing initiative aimed at helping about 21,000 low-income households nationally. Tenants living in privately-owned rental properties where the HUD mortgage has either recently or will soon mature are ineligible for Housing Choice Vouchers. What this means for families living in these developments is that they will face – during the worst economic recession since the Great Depression – likely rent increases and potential displacement from their homes and communities.

Due to no fault of their own, tenants in these properties with maturing mortgages are ineligible for Enhanced Vouchers or Tenant Protection Vouchers due to the owners’ entry into the Emergency Low-Income Housing Preservation Act of 1987 (ELIHPA) (1988-1992), or because the property is otherwise restricted from unilateral prepayment (e.g., original nonprofit ownership). The ELIHPA owners sought to preserve the affordable housing, by increasing their project revenues and having resources available to fund rehabilitation. ELIHPA also required a use restriction which insured that tenants in the non-project-based Section 8 portion of the housing were protected from rent increases and displacement. However, that use restriction is only in place up until the point of mortgage maturity, which for most projects throughout the country is sometime between 2008 and 2013.  

These unassisted tenants facing mortgage maturity are deprived of the basic protections provided to all other HUD tenants facing housing conversion actions, whether via mortgage prepayment or Section 8 opt-outs. Thus, once the mortgage matures, the tenants who are without project-based Section 8 assistance (but have for years been protected the ELIHPA use restriction or the project’s regulatory or use agreement) face rent increases and potential displacement from their homes and historic communities. This loss of tenant protections for the unassisted residents in turn jeopardizes the stability of the rest of a housing development, which in most cases will only have a partial project-based Section 8 contract going forward. 

Congressional policymakers are well-aware of this problem, and legislation was first developed by Representative Barney Frank back in 2004, after a U.S. Government Accountability Office study of the problem.  Both SEVRA (the Section 8 Voucher Reform Act) and the House Preservation bill (H.R. 4868) contain remedial language. However, because Congress is unlikely to enact either soon enough to protect tenants who have or will soon experience mortgage maturity, the Shriver Center, the Chicago Housing Initiative, and advocates throughout the country are working to add language to the FY 2011 HUD Appropriations Bill.