NLIHC Voices Concern About Housing Voucher Reimbursements

WASHINGTON, DC-The US Department of Housing and Urban Development has moved forward with its plan to readjust national payment formulas for the Section 8 housing voucher program, potentially leaving as many as one-half of housing authorities across the country with insufficient funds to cover current vouchers. The news took the form of a recent notice in which HUD said it would discontinue reimbursing local housing authorities based on actual voucher costs, but would now issue refunds based on August 2003 levels, adjusted for inflation. As a result, thousands of families are in danger of losing their homes.

The problem took on a human face, or faces, this week when the National Low Income Housing Coalition and other supporters rallied outside HUD in an effort to stave off the first victims of the new procedure–650 Massachusetts families. Yesterday, just before NLIHC members were scheduled to meet with HUD voucher program leaders on the matter, news arrived that HUD had suddenly put together the $500,000 necessary to fill the gap for Massachusetts vouchers.

Massachusetts was saved, but other states may not be so fortunate. “There are communities across the country where housing authorities will have the same problem,” NLIHC’s Kim Schaffer tells GlobeSt.com. “But Congress made it clear last year that it would fully fund this program. This is a market-paced program that was created by President Nixon as such. We want HUD to fund vouchers based on actual costs according to the latest available information.” The problem with this new calculation method is that it does not take into consideration areas where rents have increased and income has decreased.