Public Housing Policies Deny Second Chances to Ex-Offenders

April 9, 2015

The Washington Post recently told the story of a highly-qualified woman who’s had difficulties getting — and keeping — jobs because she committed a crime 25 years ago. We’ve had quite a few such stories, plus reports, conferences and the like.

But a criminal record — not necessarily a conviction — can effectively condemn a low-income person to homelessness in another way. And homelessness can propel the person back into the criminal justice system. Congress bears some share of the responsibility for this, but not as much as public housing authorities.

Federal law prohibits PHAs and private-sector owners of federally-subsidized housing from accepting as tenants people who’ve been convicted of certain sex offenses or of manufacturing methamphetamine in federally-assisted housing.

The ban applies to these ex-offenders not only as renters, but as members of households that could otherwise qualify. Generally speaking, PHAs must also impose a three-year ban on people who’ve been evicted because of a drug-related crime.

Both PHAs and the federally-assisted project owners must have written policies specifying how they will screen applicants and decide whom to house. These must include the aforementioned bans. They must also comply with some legal limits, e.g., the anti-discrimination provisions in the Fair Housing Act.

But within these bounds, PHAs and project owners can exercise discretion. And that, all too often, means denial, as a new report from the Shriver Center on Poverty Law shows.

The researchers reviewed more than 300 policies. They found a goodly number that use their permissible discretion — even exceed it — to deny housing to people who pose no manifest risk to tenants, employees, the owners themselves or the property.

Nor do they establish a legitimate basis for determining that the screened-out people would adversely affect the “right to peaceful enjoyment of the property” — a screening criterion the law allows.

The report identifies four major ways policies deny affordable housing to people who deserve a second chance, as well as some that shouldn’t need it.

Unreasonable lookback periods. The U.S. Department of Housing and Urban Development expects policies to set a reasonable lookback period, i.e., time limit, for the criminal history they’ll consider relevant.

But some policies have no time limit — or even expressly establish lifetime bans beyond those federal law requires. Some others look back as far as 25 years. So an applicant in his early 40s could be rejected because he got into a gang fight as a teenager.

Use of arrests as proof of criminal activity. The law allows PHAs and project owners to screen out people who’ve “engaged in” certain criminal activities, rather than only those who’ve actually been convicted.

Some policies expressly deny housing on the basis of arrests. Others treat arrests as evidence, though not necessarily conclusive proof of criminal activity. In either case, people are guilty, even if a judge or jury has found the contrary — or even if they were never tried.

Knowing, as we do, how our criminal justice system sweeps in a far higher proportion of blacks than whites, these policies arguably violate not only the Fair Housing Act, but similar state laws or provisions in their broader civil rights laws.

Overbroad categories of criminal activity. The law apparently envisions policies designed to protect tenants and others on covered housing properties from harm, truly intrusive disruption — or in the case of drug felonies, perhaps temptation.

Some policies go much further, effectively banning people with a record of any felony whatever — or in fact, no felony, but a misdemeanor, e.g., trespassing, urinating in public.

You see what a catch-22 we have here. Homeless people who’ve got no place to take a pee, except in an alley or behind a bush denied housing because some police officer decided to run them in.

Underuse of mitigating circumstances. The law requires PHAs to consider mitigating circumstances if applicants appeal denials based on their criminal records, i.e., reasons the crimes don’t reflect their current or likely behavior.

These may include gainful, legal employment, participation in a job training program or some other program designed to help ex-offenders stay on the straight and narrow, a strong support network or even simply the fact that the crime was committed a long time ago and says nothing about suitability as a tenant now.

Both PHAs and project owners may consider such circumstances in their initial screenings. Policies reviewed indicate that some PHAs do, while others don’t even acknowledge the opportunity to ask for reconsideration.

Nearly four years ago, HUD urged PHAs to exercise their discretion in ways that would tend to give ex-offenders second chances. “A place to live,” its letter said, is “one of the most fundamental building blocks of a stable life.”

The PHAs “essentially … put it in their pocket and continued to deny people housing,” says the Shriver Center’s Director of Housing Justice.

The new report is primarily a message to HUD, which, it says, should step up the pressure. But we can use it as a lens to screen our local PHAs’ screening policies and practices.

The latter could well include what pressure, if any they exert on project owners that won’t rent to people who may — or may not — have committed a crime. There’s obviously a role here for our civil rights enforcement authorities too.

And for our policymakers, who need to step up funding so there’s room in public and other subsidized housing for everyone who needs it, including those who deserve a second chance.


How We Could Cut Child Poverty By More Than Half and Pay for It Too

February 9, 2015

Back in 2007, the Half in Ten campaign set a goal of cutting poverty in America in half in 10 years. Not doing so well at that, are we?

Well, says the Children’s Defense Fund, what if we ended child poverty in this very wealthy country? That, of course, would mean ending poverty for parents and guardians too.

CDF recently released a report to take us a long way toward the child poverty goal. It offers nine recommendations that would reduce child poverty by roughly 60% — and deliver more economic resources for families of all but 3% of children who are poor now.

We’d have 6.6 million fewer children living in poverty, including half a million who are deeply poor, i.e., in households with incomes below 50% of the applicable poverty threshold.

What’s Notable

Several things distinguish this report. The first is that it builds on existing policies and programs that have proved effective. The aim is less to innovate than to increase reach — and in some cases, effectiveness as well.

The second, which is more distinctive, is that the report includes poverty-reduction impacts for each of the recommendations.* These reflect analyses by experts at the Urban Institute, who used Census Bureau data and its Supplemental Poverty Measure — a more complex and accurate measure than the one used for official purposes.

The third distinctive thing is that the report identifies specific policy and other budget changes that would yield enough savings or additional revenues to offset what the recommendations would cost.

What CDF Recommends

The recommendations fall into two big buckets. In the first are recommendations that would enable more low-income parents to work — or work more than they do — and to make their work pay more, both directly and through the tax code.

On the work side itself, we have subsidized jobs, like those temporarily funded through the Recovery Act. Also enough childcare subsidies so that all eligible families below 150% of the federal poverty line could afford high-quality child care during their working hours.

On the pay-more side, we, of course, have an increase in the federal minimum wage, but also an expansion of the Earned Income Tax Credit and changes in the Child Care and Dependent Tax Credit. The latter would become refundable so that families with incomes too low to owe federal taxes could benefit. At the same time, the reimbursement rate for lower-income families would increase.

In the second bucket, we have recommendations that would ensure children’s basic needs are met. These are mostly changes in major safety net programs. And all but one — treatment of child support payments — would lift more children out of poverty than any of the work-related recommendations.

The most effective of all addresses housing costs. CDF proposes a large expansion of the shrunken federal Housing Choice voucher program.

Vouchers would become available for all households with children that have incomes below 150% of the poverty line and that pay — or would have to pay — at least half their income for rent at the U.S. Department of Housing and Urban Development’s fair market rate. This recommendation alone would cut the child poverty rate by 20.8%.

Next down on the impact scale is a recommendation based on one the Food Research and Action Center has made for some years.

It would change the basis for determining SNAP (food stamp) benefits from the Thrifty Food Plan, which is generally used for no other purpose, to the Low-Cost Food Plan, which, FRAC says, is “generally in line with what low- and moderate-income families report they have to spend on food.”

We’d not only have fewer poorly-fed — or even underfed — children. We’d have 11.6% fewer in poverty. No benefits boost, however, for people who’ve got no children living with them.

How We Could Pay for the Proposals

First off, it’s worth noting that we’re already paying for child poverty — roughly $500 billion a year, according to an estimate a team of economists produced some years ago.

The proposals themselves would cost an estimated $77.2 billion a year. This is not only far less. It’s a tiny fraction — about 2% — of what the federal government spends.

CDF nevertheless lists five trade-offs, i.e., policy and spending changes that would free up funds to cover the costs of its proposals.

Like the recommendations, the trade-offs fall into two buckets. In one bucket, we have tax loopholes Congress could close, plus an income tax rate for capital gains and dividends equal to the rate imposed on wages.

In the other bucket, we have cuts in egregiously large and arguably wasteful Pentagon spending. Congress could, for example, give up on the F-35 fighter plane, which still can’t fly. This would free up $162.5 million per plane.

Total savings from this alone would fund all CDF’s proposals for 19 years, it says. Could be even longer, since the President’s proposed budget would fund more of these clunkers than the estimate CDF relied on.

On the other hand, the President’s budget does include some proposals similar to CDF’s, e.g., a subsidized jobs program, a larger maximum Child and Dependent Care Tax Credit for families with young children, more funding for housing vouchers, though far from enough to expand eligibility. General resemblances to some of the trade-offs in his tax code proposals too.

House Speaker John Boehner, among others, pronounced the budget DOA even before it got to Congress. Other sources think there might be some common ground. Far from enough — or in enough of the right places — to significantly reduce the child poverty rate. But it’s useful to know how we could do it — and pay for it too.

* Economist/blogger Jared Bernstein, who uses the report to poke Republican Presidential hopefuls, provides a table that identifies each recommendations, its impact of child poverty and the net new cost.

 


Less Poverty, Greater Income Inequality in DC

January 5, 2015

The new year seems a fitting time to check on how the District of Columbia is progressing toward two related goals — reducing poverty and achieving shared prosperity. A true good-news, bad-news story, according to indicators the Half in Ten campaign published last month.

As I’ve written before, Half in Ten created the indicators in 2011, when it restarted the clock on cutting poverty in half in ten years.

They’re organized under four main headings — poverty reduction (of course), good jobs, strong families and communities and economic security.

But they yield a fragmentary picture — in part, because Half in Ten has to use numbers already available for both the U.S. as a whole and states, plus the District. And for other reasons beyond its control, they’re not all current.

I’ve tried in the past to follow Half in Ten’s framework. A different approach this year, based on what I found most striking, especially when I looked back to the original indicator set.

Long story short: The District has a lower poverty rate than in 2010. But shared prosperity still seems a will o’ the wisp.

Poverty Reduction

The District’s poverty rate last year was 0.3% lower than in 2010 — 18.9%, as compared to 19.2%. The new rate is still higher than rates for all but five Deep South and Southwestern states.

The race/ethnicity breakout is one way we see income inequality in the District. For example, as I reported when the figures were released, the 2012 poverty rate for black residents is more than three times the rate for non-Hispanic whites.

Income Inequality

Half in Ten’s indicator is the ratio between the shares of income that went to households in the top and bottom fifths of the income scale last year, according to the American Community Survey. By this measure, income inequality in the District is extraordinarily high — 30.3. It’s far larger than any state’s — and more importantly, larger than in 2010.

But the ratio is, to me, a tad abstract. So let me translate it into actual shares. Of all the household income in the District, the top fifth enjoyed nearly 55.4%. The bottom fifth had to make do with slightly more than 1.8%.

Some Contributing Factors

On the one hand, 70.2% of young adults in the District have at least a two-year college degree — a slight uptick since 2010. As you’d expect, this is far higher than the percent in any state.

On the other hand, only 59% of teens who started high school graduated four years later, as of the 2011-12 school year. This is a slightly lower percent than the rate for the prior school year — and the lowest reported for 2011-12.

Not surprisingly, the District has a relatively high percent of “disconnected” youth, i.e., 16-24 year olds who were neither working nor in school in 2012. This latest “disconnected” rate — 17% — is exactly the same as in 2010, which again puts the District roughly mid-way in the state rankings.

No such flat-lining for the unemployment rate, which declined from 9.9% in 2010 to 8.3% last year. Pretty obvious who’s getting the jobs — and not — in our burgeoning local economy.

On the upside, the teen birthrate declined quite a lot. In 2012, there were 38.6 births for every 1,000 women between the ages of 15 and 19. This is 6.8 fewer than in 2010. And though still high, it’s nowhere near rates in the bottom-ranked states.

Teen birthrates are often correlated to poverty — as cause, effect or some combination of both. Recent research suggests that income inequality is an additional factor because poor young women see little chance of improving their economic situation if they postpone motherhood.

The percent of children in foster care also has bearing on the poverty rate — again, as cause, effect or both. It’s still high in the District — 11 children per 1,000, as of 2012. But it was 20 per 1,000 in 2010.

Further Progress Possible

Some state and local governments are adopting policies that can reduce poverty and enable low-income people to gain a greater share of prosperity, as the report that includes and provides context for the indicators selectively shows.

Here in the District, for example, the minimum wage will step up to $11.50 in July 2016 — $4.25 more than the federal minimum. Ten states also raised their minimum wage last year, making 29 that now have minimums above the federal.

Proposals to raise the federal minimum have gone nowhere in Congress — and most surely won’t during the next two years. The same seems likely for other legislation that would boost low incomes and strengthen both work supports and safety net programs for people who can’t earn enough to meet basic needs.

So, as the report concludes, “the momentum for national change” of a progressive sort has to build at state and local levels. A call to action for advocates and grassroots organizers.

And, I suppose, a hopeful note to end on, since it implies that we’ll have a renewed federal commitment to reducing poverty and income inequality sooner or later. But in the meantime, we’ll have inequities at least as large as those we have now based on where people live.


More High-Poverty Neighborhoods, More Poor People Stuck in Them

December 18, 2014

Here in the District of Columbia we’ve got rumblings and grumblings about gentrification. Young strivers (mostly white) choosing to live in the city. Driving up housing costs in formerly affordable, if often rundown neighborhoods. And so driving out low-income families. Saddling the remainder with heavy rent burdens.

Gentrification — and the related debate over the pluses and minuses — are hardly unique to the District. We read about skyrocketing rents and displaced minorities in New York City, Seattle, San Francisco and other urban centers.

But a new report tells us that gentrification, though real is rare — at least, in the 51 major metro areas it covers. We should be much more concerned, it says, about high-poverty neighborhoods, i.e., those where at least 30% of the residents are officially poor.

We’ve got more of these neighborhoods now for two reasons. The first, which speaks to gentrification, is that most neighborhoods that were high-poverty in 1970 still were forty years later. The second is that well over 1,200 more neighborhoods became high-poverty during this period.

A relatively small percent of urban poor people live in high-poverty neighborhoods — roughly 4 million of the 46.2 million people in poverty in 2010. But that’s twice as many as in 1970.

Looked at another way, the percent of urban poor people living in high-poverty neighborhoods increased from 28% to nearly 39%. In other words, we have not only more high-poverty neighborhoods, but more poor people in them.

I recently heard a presentation by a mother who lives in one of the District’s public housing complexes. She objected strenuously to plans that would convert what’s surely a high-poverty neighborhood into a mixed-income community — foreseeing, it seems, that she and her fellow public housing dwellers would be dispersed.

“Deconcentration offends me,” she said. It means “I’ll be better if I live next to you,” referring to her mostly middle-class audience. This is surely a perspective worth considering.

Yet we’ve research indicating that residents of high-poverty neighborhoods are worse off specifically because that’s where they live.

For example, our public housing resident understandably wants ready access to good schools and healthful, affordable food. Well, supermarket chains generally don’t open stores in high-poverty neighborhoods, for obvious economic reasons.

Schools in high-poverty neighborhoods are frequently underfunded. And it’s not only money they lack. They tend to have less-qualified teachers and principals, in part because they’re challenging places to work. So teachers who don’t quit, as many do, will often transfer when they can.

Sociologist William Julius Wilson has long argued that lost job opportunities in the city helped explain a host of problems in high-poverty, predominantly black urban neighborhoods — more crime, deteriorating housing, failing schools, breakdowns in family and other social structures, etc.

These lead to more concentrated poverty because people who can flee to better, safer neighborhoods. So there are fewer local retail businesses because residents don’t have the income to support them. Nor can potential risk-takers get financing. And so there are fewer nearby job opportunities — and fewer working neighbors to serve as role models, mentors and networks into the labor market.

In short, as one of the authors of the high-poverty neighborhood study says, “Place plays a significant role in shaping individual economic opportunity.”

We see the results in several studies conducted for the Pew Charitable Trusts. One found that children raised in high-poverty neighborhoods were less likely to move up the income scale as adults — and considerably more likely to move down if they hadn’t been at the bottom to begin with.

Another found lower rates of economic mobility in metro areas where neighborhoods were highly segregated into pockets of wealth and poverty. These include the District and nearby suburbs, which had a higher economic segregation score than all but two of the other metro areas assessed.

The Urban Institute’s Marjorie Turner reminds us that “neighborhoods of concentrated poverty aren’t the products of ‘natural’ or ‘normal’ housing market operations.” Nor, as she and a colleague earlier wrote in reference to the Washington metro region, do they “reflect the ‘choices’ of poor families about where to live.

Public policies created them — legal segregation, then permitted race discrimination and decisions about where to locate public housing. All but the first are generally true in all the urban areas with high-poverty neighborhoods.

Now, highly-concentrated poverty isn’t only an urban problem. Nor are blacks the only people affected, though much of the research has focused on them. We find extraordinarily high poverty rates on Native American reservations, for example, and in predominantly-white hill towns of Appalachia.

We increasingly find it in suburbs, as we know (if we didn’t before) because the cop shot the kid in Ferguson — a case study in its own right of the legacy of segregation, persistent race discrimination and a failed public housing policy.

There’s obviously no one-size-fits-all solution to the problem — not even for high-poverty urban neighborhoods like those clustered “east of the river” in D.C.

Turner (and others) recommend multi-part, multi-partner “place conscious” strategies. These connect families to opportunities outside their neighborhoods, while at the same both expanding opportunities within their neighborhoods and helping those who want to move to higher-opportunity neighborhoods to do so.

“A big structural challenge,” she acknowledges. But it sounds like the right approach to me. And I think the mom in public housing would like it too.

 


DC TANF Families Face Benefits Cut-Offs With Dim Prospects for Steady Work

December 8, 2014

In early 2012, the D.C. Department of Human Services launched a redesigned Temporary Assistance for Needy Families program. As with TANF programs nationwide, it aimed to move very poor parents with children toward self-sufficiency, i.e., work that pays enough to support the family — or at the very least, too much to make them still eligible for TANF.

Now we have an in-depth, though partial view of the results. A recently-completed review of the TANF employment component found, among other things, that fewer than half the target group of parents who, with help, had found jobs were still employed.

But even this finding overstates the self-sufficiency prospects for the more than 6,000 families who may soon have no cash income whatever because the DC Council set a retroactive 60-month lifetime limit on benefits in late 2010 and a phase-out schedule ending in total cut-offs next October.

About the Review

The Office of the District of Columbia Auditor analyzed data and other information that DHS provided, with a view toward providing the basis for some conclusions about the outcome of what it refers to as the TANF Employment Program.

The program consists of two related types of services — work readiness and job placement. Both are provided by contractors. Work readiness contractors, as the term suggests, are supposed to help parents strengthen their qualifications for paying work.

But they are responsible for helping the parents find jobs as well. This is the only thing the job placement contracts are supposed to do because the parents assigned to them have been deemed ready to work.

The auditors focused only on parents who had received TANF benefits for more than 60 months because these were the parents whom DC Council Human Services Committee Chairman Jim Graham asked about.

They looked at data collected over about 32 months — from the time the new employment program began, in February 2012, to October 24, 2014. Graham wanted results by early November.

So the auditors were up against a tight timeframe. As a result, they’re careful to say, they didn’t verify what they got from DHS, as they ordinarily would.

Jobs of Any Sort for Fewer Than Half

Though the two types of employment services differ in scope, they’re both intended to get TANF¬† parents into — or back into — the workforce and earning enough to no longer qualify for TANF. For a family of three, that would have been anything over $588 a month in 2012-13, assuming no other income.

The auditors report that about 49% of parents referred to an employment services contractor got a job — 6,145 out of 12,463. Only about 38% got jobs that could have provided steady, full-time work.

The rest got placed in jobs that were either part-time or “temporary/seasonal” — the latter presumably referring to temporary or on-and-off jobs during periods of high-volume business like the holiday shopping season.

Wide Pay Range, Including Less Than Minimum Wage

While working, the parents got paid an average of $10.58 an hour — more than the District’s minimum wage, but less than its living wage, which is now $13.60 an hour and was less during the two prior years the audit covered.

The average masks a wide disparity in pay rates. A relative few jobs paid in the $21-$50 an hour range. A far greater number — nearly 1,590 — reportedly paid less than the District’s minimum wage.

The auditors suggested (not in the report) that contractors may have reported the minimum cash wage parents got when placed in jobs that employers chose to pay at the tip-credit wage rate.

But the District’s tip credit wage is lower than most of the subminimum wages indicated. DHS perhaps could explain, but hasn’t, though I asked.

Steady Work for Very Few

As of mid-October, 2,976 TANF parents were employed — about 48% of those who’d been placed. Only 770 remained in the jobs were they’d been placed for more than six months.

We see a drop-off beginning at the end of the first month. (The auditors don’t report a figure for parents who lost their jobs or quit sooner.) Their figures do, however, show that 835 parents didn’t have their jobs any more by the time the fourth month rolled round.

Whether they’d been placed in other jobs is an open question. Indeed, the job tenure figures may not tell the whole story.

DHS informed the auditors that an estimated 3,076 “customers” in the 60-month-and-over group had left the program — a majority, it said, because they began earning too much to remain eligible. No supporting data provided.

And the agency doesn’t know whether “customers” who did earn more than the minimal maximum for eligibility remained employed — let alone how gainfully — because it doesn’t track families once they leave the program.

More Knowns and Unknowns

First off, we should recall that the auditors focused solely on parents who’d been in the District’s TANF program for quite a long time — or had cycled in and out for even longer. Results for parents who had recourse to TANF because of some singular, temporary setback might be different.

On the other hand, the parents in the sample didn’t include those whom DHS had identified as having significant, ongoing health and/or personal barriers to work, e.g., alcoholism or drug addiction, PTSD due to domestic violence.

About 60% of the rest weren’t immediately work-ready, according to the agency’s assessments. It assigned them to contractors for further education and/or development of marketable skills. Fewer than 10% completed their programs.

Does this mean they were hustled into jobs they couldn’t keep because contractors get a bonus for placements? Or did they themselves get desperate because their very low benefits had shrunk — and were soon to disappear?

Did the fact they had to scramble every day to find a place for their family to spend the night — or some used clothing for their kids — make it just too hard to satisfy the work readiness requirements and, more importantly, their employers’ expectations?

Do we need a thoroughgoing, independent assessment of the TANF employment program? Sure does seem that way.


Many Millions Above the Poverty Line Lack Basic Economic Security

November 24, 2014

Blogger Matt Bruenig has declared war on the notion that poor people are “a small, especially degenerate class.” I don’t think this view is as common as he implies, thought it’s hardly as marginal as one would wish.

I mentioned his campaign, however, because the salvo I’ve linked to focuses on the arbitrariness of the federal poverty line. Look, he says, at the 53 million people hovering just above it, according to the Census Bureau’s latest Supplemental Poverty report. That’s 4 million more than fall below it.

And look at the gradual upward slope of the income distribution from way below the poverty line up to 300% of it. We see no “especially large gap” that would justify putting poor people into one bucket and everyone else into another.

Besides, he reminds us, people cycle in and out of official poverty. During 2009-11, for example, 31.6% of the population lived in poverty for at least two months, but only 3.5% were poor for the entire three-year period.

It’s nevertheless hard to imagine doing away with a line of some sort or other — at least, so long as we have programs that set eligibility and/or benefit levels based on income.

At the same time, a line, wherever we set it, will be a crude measure of what should most concern us — material hardship. Do people have the wherewithal for food, shelter, heat during the winter, etc. For what they need to pay in order to work, e.g., transportation, perhaps child care?

As I wrote awhile ago, Molly Scott at the Urban Institute showed that a single mother working part time at the minimum wage could actually be better off than a single mother working 60 hours a week at the same wage. Public benefit help explain this, but so do work-related costs.

Yet having just the resources to get by day to day without material hardship seems a low bar to set in a country with as much wealth as ours. Wider Opportunities for Women proposes that we look instead at how much a family much have to be economically secure.

WOW has a very complex database — the BEST (Basic Economic Security Tables) Index. It’s made up of many hundreds of monthly budgets for different family configurations, with and without employment-based benefits, and each reflecting costs in diverse geographic locations.

The budgets include not only basic needs and work-related expenses, but some savings for retirement and for emergencies — enough to get along for nine weeks without earnings because that was the average time jobless workers remained unemployed when the index was created.

The budgets are strictly “no frills,” in the words of WOW’s Vice President for Policies and Programs. In other words, they don’t allow for entertainment, vacations or even electronics, except a phone. They do, however, include optional, below the line savings for higher education and home ownership.

Using the BEST Index, WOW finds that 44% of Americans didn’t have enough income for economic security two years ago. Children in the household raised the rate to nearly 50%.

Economic insecurity was much more common than this for single parents with children — 77% without enough income. The rate for single-mother families was an even higher 81% — more than two and a half times their high poverty rate.

These are national figures. Economic security requires far more income in some places than others, of course. Consider, for example, Scott’s single mother and her two elementary school-age children living in the District of Columbia.

She and her kids would have cleared the poverty threshold in 2012 if she earned $18,500 a year. But she’d have had to make well over four times as much — at least $79,932 — for her family to be economically secure.

“At least” because this formidable sum assumes she was eligible for unemployment insurance, e.g., not a contract worker, and that her employer provided both a health insurance and a retirement plan. Without these employed-related benefits, she’d have had to make $85,992.

In both cases, the biggest ticket items for her child care, taxes and rent. Child care was the second biggest, even though her children needed it only during after-school hours — nearly $1,300 a month. And the rent, as WOW computes it, is quite low for the District — $1,259 a month.

I’m not sure what we should make of all this. I suppose we could begin, as Professor Stephen Pimpare suggests, by recognizing the “widespread economic fragility” of households in our country — and the weakness of the safety net many are likely to need.

But there are other, more specific policy lessons in the enormous gap between what it takes to be officially not-poor and what it takes to have enough for health, safety and work-related costs, plus a modest stash to draw on so as not to fall into poverty.

Far too many lessons for this post. But the sobering figures surely support a wide range of proposals — and confirm objections to others that our recent “Republican wave” seems likely to toss onto our Congressional and state legislative agendas.

 


Acute Affordable Housing Shortage for Lowest-Income Renters

September 11, 2014

A new and notable brief from the National Low Income Housing Coalition provides further evidence of the shortage of housing that low-income individuals and families can afford to rent.

As in the past, NLIHC flags the acute shortage of units that extremely low-income households could rent at an affordable rate, i.e., for no more than 30% of their income.

ELI households are the poorest category used for publicly-subsidized affordable housing — and the poorest analysts customarily use. They’re those whose incomes are at or below 30% of the median for the area they live in.

The most notable thing about the NLIHC analysis is that it introduces a new poor category — deeply low-income households. Their incomes are, at most, 15% of the applicable AMI.

ELI and DLI Renters Nationwide

DLI households are part of the ELI category, but we can see how recent housing and income trends have disadvantaged them the most. For example, in 2012, the latest Census figures NLIHC had to work with:

  • There were 10.3 million ELI renter households nationwide, but only 3.2 million available units they could afford — in other words, 31 for every 100 households.
  • Of these households, 4 million were DLI.* The shortage for them was nearly as great as their number — 3.4 million units. This translates into 16 units for every 100 households.
  • All but 13% of ELI households paid more than they could afford for rent, plus basic utilities. And 75% of them paid more than half their income for these basic needs.
  • Housing burdens, as they’re called, were even worse for DLI households. Ninety percent paid more than they could afford and 95% more than half their income.

Drilling Down to DC

Another notable thing is that NLIHC includes (un)affordability figures for states and the District of Columbia and for major metropolitan areas, including the one used to set the AMI for the District. So we who have a particular interest in affordable housing for the District’s lowest-income residents have new grist for our mills.

Somewhat surprising, at least to me, is the fact that the crunch for them is apparently somewhat less severe than the nationwide crunch — at least, according to the NLIHC figures. We should take them with a grain of salt, however, because the AMI for the District is considerably higher than the District’s own median income.

That said, the local housing market is hardly friendly to the District’s lowest-income renters. And we’ve got a lot of them. NLIHC reports that:

  • There were 26,485 ELI households in 2012 and only 45 affordable, available rental units for every 100 of them.
  • Nearly 71% of them — 18,750 — were DLI households. For them, the affordable housing shortage was worse — 34 units for every 100 households.
  • All but 29% of the ELI households — and all but 23% of those in the DLI subgroup — paid more than half their income for rent.

So for large majorities of both, rental housing wasn’t just somewhat unaffordable, but so unaffordable as to represent a significant risk of homelessness — or if not that, then other hardships.

Trade-Offs Made to Pay for Unaffordable Housing

A recent survey for the MacArthur Foundation found that nearly two-thirds of childless adults — and 75% of parents — whose rents or mortgages were unaffordable had made at least one trade-off in order to cover their housing costs.

Trade-offs included cutting back on health care and/or “healthy food,” amassing credit card debt and giving up on saving for retirement.

Why ELI and DLI Renters Can’t Find Affordable Units

As NLIHC has explained before, part of the problem is that more higher-income households are choosing to rent. So the law of supply and demand has kicked in, driving up what landlords charge.

At the same time, developers have seen a money-making opportunity. Of the 2.5 million rental units added to local markets since 2009, fewer than half a million were affordable for households with incomes below 80% of the AMI, i.e., the highest of the low-income tiers.

It’s also the case, however, that higher-income renters are occupying units that ELI households could afford — about 45% of them nationwide. A recent in-depth study of the Washington metro area came up with virtually the same crowd-out figure.

So there’s a large unmet need for low-cost units. But, as NLIHC says, organizations that want to help meet it face significant challenges, e.g., insufficient subsidies for both developers and operators, who can’t otherwise cover their costs with the rents they’ll collect.

A clarion call for greater public investments in affordable housing programs, of course. And since we can’t look to Congress any time soon, state and local governments, including the District, will have to do more for their lowest-income residents.

Obvious, but I felt I had to say it.

* The American Community Survey, which NLIHC used for most of its analysis, reaches only people who are in some manner housed. So the affordable housing shortage for the very lowest-income individuals and families is even greater than reported, as the brief duly notes.


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