In an obscure but public meeting Last week, local and federal housing officials discussed a controversial idea that could change U.S. housing policy: What if the government gave money directly to tenants, instead of relying on a complicated voucher system that drives both tenants and landlords to the wall? You’ve heard of a universal basic income. What about universal basic rent?
The status quo doesn’t work particularly well. More than half a million Americans become homeless every night, the housing stock is scarce, and rent and mortgage payments are consistently among the heaviest bills families have to carry. For decades, most federal housing assistance has taken the form of a voucher program known as Section 8. But the program is: laborious and bureaucratic. Landlords are often reluctant to jump through government regulatory hoops to get the money, so they choose it. Due to funding constraints, only a quarter of those who qualify for vouchers even get one, and those lucky ones often have to search dozens of ads before they even found a single unit that could accept the grant.
President Joe Biden pledged during his campaign to make these vouchers available to all eligible low-income families, and Congress is debating a measure as part of his economic package that would about 750,000 more vouchers to the program. If it becomes law, that expansion would certainly help some Americans find homes. But it wouldn’t solve the underlying problem: most landlords don’t want to rent voucher recipients.
The coronavirus pandemic demonstrated the feasibility of an alternative path — one that officials in the Biden administration now seem at least willing to discuss. Congress has done a lot to help people struggling with the economic impact of COVID-19. One initiative, a government-run program to prevent evictions, has become entangled in paperwork and delays, and only one fifth of the money allocated to it by the federal government has been distributed. Another program, where the IRS simply mailed the US stimulus checks, gave people instant cash on hand.
These recent experiences can inform federal leaders as they explore new ways to improve housing assistance. Last Thursday, at a public meeting hosted by the Ministry of Housing and Urban Development, policy experts and housing authorities discussed new ideas for voucher programs that could be formally studied. Making vouchers more like cash for tenants, as opposed to subsidies for landlords, was one of the top three ideas that emerged from the meeting, and it will be further explored at a second meeting later this month. The leading proposals can be tested under a HUD program known as: Moving to work, which has been in existence since 1996, but was expanded by Congress in 2016.
Handing out cash housing benefits was the second most popular idea discussed at the meeting, and participants recognized that it could also be a cost-effective element as it would reduce or even eliminate the need for regular HUD voucher inspections. – eligible housing. At the end of the three-hour session, the committee members voted to continue their discussion of the idea at their next scheduled meeting, on October 28.
“I think it’s interesting in light of [universal basic income], and I think it would be interesting to decouple government from looking for the right type and size and quality of housing and leave that to the people,” said Chris Lamberty, the executive director of Lincoln Housing Authority in Nebraska, at the meeting.
A few hours after the virtual call, Todd Richardson, the head of HUD’s research department, noted that the meeting participants seemed relatively enthusiastic about the idea of monetary aid. However, he warned it might not get through the agency’s legal department. Asked for clarification on what the legal issues may be, a HUD spokesperson told: The Atlantic Ocean that the public meeting posted on the Federal Register was not “intended for the press” and “I don’t think we sent an invitation to the press.”
Moving to work isn’t the only vehicle policymakers can use to test the idea of providing cash-based rental assistance to renters. Congress could also authorize a pilot study like this one did in 2019 when lawmakers approved a new voucher program to help families move to wealthier neighborhoods.
And in Philadelphia early next year, a new study will investigate how families fare when they receive cash rental assistance. “There has never been a full review of tenant cash usage for our tenant-based vouchers,” said Vincent Reina, one of the University of Pennsylvania researchers who will review the program. “There’s been some explorations, but a real, proper evaluation is something we’ve never really done.” Reina attributes the lack of study to political resistance. “Cash transfers are often more contentious,” he said.
A real test of the idea came closest to the 1970s, when Congress passed the Experimental housing benefit program. That program, which ran for more than a decade in a dozen US cities, directly provided monetary assistance for housing to more than 14,000 low-income families. In a report submitted to Congress in 1976, program evaluators noted that housing allowances were well received by their local communities and that housing payments were successfully delivered to tenants.
Obviously, at least some current HUD employees are considering this old research. In 2017, Richardson published a blog post suggesting that the 1970s housing allowance experiment could inform the Moving to Work program today.
Housing authorities could oppose the idea, as it could force them to give up some control. Other authorities may not be confident that the money would go toward rent. The findings of the experimental housing allowance program also suggested that cash subsidies could lead to lower-quality housing options for tenants, though experts caution against drawing firm conclusions from the half-century-old research.
Studying the idea of cash rental assistance has great potential, Phil Garboden, a professor of economics, policy and planning of affordable housing at the University of Hawaii at Manoa, told me. “I can imagine vouchers will continue to exist in their current form for quite some time, but it’s a great idea to study it,” he said. “We have absolutely no good data on it.” Garboden hopes researchers can find out if landlords are avoiding the vouchers, especially because they don’t want to deal with the red tape, or simply don’t want to rent out to poor people.
Some renters may prefer the status quo of the voucher, but for others, cash may be easier to use. Being able to pay for housing with cash or a special housing subsidy can ease some of the red tape associated with navigating the U.S. Social Security system — which is the Atlantic Ocean Writer Annie Lowrey came up with ‘the time tax’ earlier this year.
“Different forms of support work differently for different people, and a voucher can be a very effective mechanism for some households and some markets and less effective for others,” Reina told me. “It is not to say that vouchers cannot work, cannot be improved or should not be made universal, but we know from our existing voucher research that older households, households with children and households where the head is black are less likely to use vouchers. .”
Stefanie DeLuca, a sociologist at Johns Hopkins who attended Thursday’s meeting, told me it may be worthy for some renters to hand out housing assistance as cash. “The Earned Income Tax Credit study points to the idea that recipients experience a sense of freedom of choice and dignity when they received a lump sum, and I suspect tenants who can present themselves to landlords as paying like any other potential tenant could feel quite empowering,” she said.
Anyway, DeLuca’s own research suggests that the existing housing voucher program could actually be improved to entice more landlords to participate, even in competitive markets. Researchers have been studying landlord signing bonuses and ways to get landlords money faster. Even COVID-19 has helped accelerate the digital streamlining of HUD contracts, making them less tedious to manage.
AN new bipartisan bill introduced in May by Senators Chris Coons and Kevin Cramer would seek to remove Section 8’s bureaucracy for landlords. HUD also starts a new, large study on incentives for landlords as part of the Moving to Work expansion.
And to be sure, one of the reasons lawmakers have long resisted cash transfers is the fear of political backlash. Over the years, Republican and Democratic politicians have embraced the myth that well-being rewards laziness, and benefits in particular will arouse public outcry.
But now that we’ve come out of the pandemic, it’s clear that cash aid to Americans is more politically feasible — even more popular — than many in Washington previously thought. The US government has also proven that it can quickly remove checks when it deems it necessary. In fact, distributing money can be easier than managing a Byzantine social insurance program that the eligible participants may not even know about. If landlords continue to resist housing vouchers, the government may take that decision out of their hands and simply give tenants cash.