Federal Housing Assistance is a Good Investment that Helps More than Tenants

With federal housing assistance today helping only one of four eligible families, it’s clear that increased investment in making sure everyone has a decent place to live would pay big dividends for all Marylanders by boosting the state economy.

In 2014, these programs helped make housing affordable for nearly 98,000 Maryland families and brought $969 million into the state, according to new data released by the Center on Budget and Policy Priorities. Increased investment would benefit tens of thousands more Maryland families.

Most housing assistance is delivered through three federal programs:

• The Housing Choice Voucher program provides vouchers that families can use to pay rent at privately owned housing that they choose. These vouchers are authorized by the federal government and then issued by a local housing authority once the beneficiary family finds an apartment or house. About 43,000 Maryland families use this type of assistance.
• Project-based rental assistance provides housing in privately owned buildings made available through contracts with the federal government. About 24,000 families live in this type of housing in Maryland.
• Public housing allows families to pay an affordable rent in publicly owned buildings. This type of assistance benefits about 18,000 families in Maryland.

Families receiving housing assistance are among Marylanders who struggle the most to make ends meet. Three-quarters of participating families take home less than 30 percent of the local area median income. For a family of four living in Baltimore City, for example, this would mean they earn less than $26,500 per year.

Thirty-two percent of participating families are headed by an elderly person, 29 percent are headed by a person with a disability, and 35 percent have children. Of those who are able to work, the vast majority are working or were recently working. Families are generally expected to pay 30 percent of their income in rent, the maximum amount considered affordable under federal guidelines. Thanks to housing assistance, about 78,000 Marylanders are better able to make ends meet, as the help they get paying rent in effect brings their incomes above the federal poverty line, which is about $24,300 per year for a family of four.

Helping families stay in stable housing benefits the entire community. Landlords whose tenants can afford to pay rent thanks to housing assistance have an easier time keeping buildings occupied, so fewer buildings lie vacant or fall into disrepair as a result. In addition, housing assistance frees up money for families to spend on food, childcare and other essential needs. That, in turn, boosts sales at local businesses.

A greater investment in housing assistance would bring even greater benefits to Maryland families and our economy. The federal government now allocates only enough money to assist one of four eligible families, leaving the majority without any help in the face of rising rents. Federal budget cuts over the last few years made matters worse. Maryland lost nearly $35 million from 2010 to 2014. Meanwhile, the need grew.  In 2013, 167,000 Maryland families who could have benefited from housing assistance paid more than half of their income in rent, an increase of 29 percent from 2007. Last year, more than 8,000 Marylanders were homeless, including about 2,000 children. If a greater investment were made in housing assistance, fewer Marylanders would be in emergency shelters or on the streets. Fewer families would be living just one unexpected expense or smaller paycheck away from losing their homes.

In the absence of more federal housing support, local housing authorities can take steps to get more help to people who need it. In 2015, Maryland housing authorities were authorized by the federal government to issue about 53,000 housing choice vouchers, the most common type of federal housing assistance. Of these, fewer than 45,000 vouchers were actually in use, putting Maryland’s rate of using this type of support below the national average. Seven jurisdictions issue fewer than 80 percent of their authorized vouchers, including the Housing Authority of Baltimore City, the state’s largest. Local authorities can take steps to maximize the number of vouchers that are issued, even if this is also influenced by factors outside their control, according to a report from the Department of Housing and Urban Development.

For example, agencies that update voucher waiting lists frequently issue a larger share of their authorized vouchers than those that update their lists less often. In Baltimore, the waiting list often goes multiple years without being updated. If local housing authorities made sure that all available vouchers were issued promptly, more than 8,000 families would benefit.