The struggle to pay rent is about to get harder

The federal Section 8 housing program helps low-income Americans afford decent places to live. But now it's about to be trimmed, meaning it will serve fewer people, or serve them less well - or both.

Bobby Parker was born and raised on the east side of the Potomac River. His dad was a mechanic and his mom a maid, but the home he grew up in was "just fine," he recalls.

Still, "I never thought much about how they paid the rent," he admits. "It seemed no big deal."

In years since, however, as he has moved in and out of rentals, into shelters, out to the streets, over to friends' back porches, and onto his children's couches, he has given the subject much more thought. And, he says, scratching his bushy mane of hair, it's anything but "no big deal."

Sixty-five million Americans, or 24 percent of the population, have housing problems, according to the National Low-Income Housing Coalition in Washington. Some are elderly or unemployed. Others juggle two, even three low-paying jobs. Many are single moms. Some are disabled. All are scrambling, one way or another, to pay the mortgage or find the rent.

And it looks as though the scramble might get harder. President Bush's budget proposal for 2005 calls for cutting the Section 8 housing voucher program - the nation's principal low-income housing assistance program - by $1 billion, leaving it $1.6 billion short of what's required to maintain the program's current level of service.

While Mr. Bush's proposal has been known since January, the uproar over the cuts began two weeks ago, when the Department of Housing and Urban Development (HUD) released its guidelines and announced that, except for small adjustments for inflation, it has frozen rental rates at the amounts in effect last August, even if rents have gone up.

"The Bush administration is breaking a 30-year promise to help low-income families, the elderly, and the disabled to afford decent, safe housing," House minority leader Nancy Pelosi (D) of California said at a news conference last week.

Together with Rep. Barney Frank (D) of Massachusetts, a ranking member of the House Financial Services Committee, Ms. Pelosi is introducing a bill to restore full funding by requiring HUD to use the previous voucher formula. Some Republicans, such as Gov. Mitt Romney of Massachusetts and Gov. Tim Pawlenty of Minnesota, have also been pressing the agency to relent.

The Section 8 program, started in 1976 helps families that make less than 50 percent of an area's median income (with some exceptions for the disabled and the elderly), by giving them vouchers that pay up to 70 percent of the rent for houses or apartments they choose.

Subsidies produce benefits

Today, about 2 million low-income Americans use the Section 8 program. The program has succeeded in deconcentrating poverty (by spreading those with low incomes among many different areas). It has also given families an opportunity to live in cleaner, safer neighborhoods, where their children can get a better education, and where they can be closer to employment opportunities.

The Center on Budget and Policy Priorities, a Washington think tank, estimates that if all housing agencies coped with the funding cuts by assisting fewer households, they would have to shrink the program by 250,000 families next year and by about 600,000 families - roughly 30 percent of the entire program - by 2009.

Alternatively, if housing agencies coped with the funding cuts by raising rents, they would have to charge an average of about $850 more per family in 2005 and about $2,000 more per family in 2009, even though most of these families have incomes well below the poverty line. In practice, this would force beneficiaries to move to cheaper apartments or houses.

"Well, I don't know too much about budgets," says Parker, sitting on the front stoop of his friend's house in the Anacostia neighborhood, where he has been staying for the past few months. "But I'm no fool. If I am waiting for housing help, and the guys who are already getting help are in trouble, then I am in double trouble."

A year shy of retirement age, Parker drove a forklift for nine years, and was a driver for a finance company for five more. Once, he says, he was doing a pickup at the airport and saw James Brown, the soul singer. "Met some good people at that job," he says. "But rent was hard to come by even then."

These days, his plan to make some cash fixing potholes has fallen apart, his odd jobs here and there bring in a pittance, and paying the rent has become impossible - so he has filled out forms to receive vouchers.

At HUD, the proposed budget cut for the Section 8 program is explained, in part, as a reform. The current unit-based system gives vouchers to local housing authorities based on the number of low- income households in the area.

Deficits if costs aren't contained

The proposed change will give a lump sum to local authorities and more discretion over how they use the money.

In the past three years, the Section 8 budget nationwide has ballooned by 27 percent, and officials at HUD say that too many housing authorities have become so accustomed to HUD's carte blanche approval of Section 8 costs that they have not performed with maximum efficiency.

Also, because vouchers absorb 60 percent of HUD's budget, HUD will face a $191 million deficit if the current system continues, officials add.

According to Donna White, a spokeswoman at HUD, the current voucher costs paid by the federal government have risen more than twice as fast as the average private-market rents over the past two years. And the program's complex rules have also limited its effectiveness, she says, while the new plan to give local authorities more flexibility will make the dollars go further.

Yet another aspect of the debate over Section 8 has to do with the Bush administration's more general approach to housing policies, which is to encourage homeownership, especially among low- income and minority families, as a desirable alternative to renting.

Reflecting this focus, HUD's overall proposed budget for 2005 has actually risen by 3 percent, which is much higher than many other nonsecurity-related federal departments this year.

Bush's 2002 promise that, by 2010, the number of new minority homeowners would increase by 5.5 million has been followed up by a spate of initiatives to help make good on the pledge. In late 2003, the American Dream Down Payment Act, which authorizes up to $200 million for down payments for low-income prospective homeowners, sailed through Congress.

Instead of cutting Section 8 in favor of programs encouraging home ownership, "let's design some other approach," suggests Betsy Morris, CEO of the San Diego Housing Commission.

The new cuts in rental subsidies, she argues, will ultimately mean that fewer people will be able to qualify for home ownership. "This proposal will only make the need for homeless programs bigger."

Jim Inglis, president of the National Association of Housing and Redevelopment Officials, objects to the cuts because of the impact they will have on the working poor.

"We will simply not be able to properly service the needy already in the program," he says. "And we will be telling the thousands on waiting lists that they will never be served at all."

Angela Skinner, who lives with her three children down the street from where Parker is staying, receives Section 8 vouchers that enable her to pay only $30 a month for her two-bedroom walk-up.

One woman's experience

Ms. Skinner works at the concession stands of the MCI Center in downtown Washington, and her income is dependent on how many events take place at the arena that month. Sometimes she works three nights a week; sometimes none.

At the end of the month, after paying for utilities, food, transport, and "this and that," she is left with no savings.

She has not heard about the proposed budget cuts, but she understands their implications."Without my vouchers," Skinner says, "I would be just like Parker here - on someone's porch or down at the shelter with my kids running here and there. And that would be bad. Bad."

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