Government Shutdown Puts Rental Assistance Programs in Jeopardy

Thursday, January 17, 2019
Annie Nova

Patrick Greene could soon see his rent double.

The 70-year-old man lives with his wife, Karen, in a two-bedroom apartment in Montgomery, Alabama.

He pays $460 a month for the apartment, and the rest of his $940 rent is normally covered by the U.S. Department of Housing and Urban Development. Due to the stalemate in Washington, D.C., however, his landlord informed tenants that she hasn't received the government funds.

"We literally have no idea what's going to happen," Greene said, adding that he and wife live off around $1,500 a month.

If he has to pay more for his rent, Greene said, he and his wife will need to cut back on what they eat. Even though his wife has osteoporosis and kidney disease, they'll also have to walk a half a mile to Walmart instead of paying a neighbor in their building $5 to drive them.

"The general consensus in these buildings is that Trump doesn't care if old people die," Greene said.

A number of government-funded rental assistance programs are in jeopardy as the longest shutdown in U.S. history wears on. A red screen on HUD's website explains that the agency is closed until further notice.

"Nearly 700 property owners who have HUD contracts to operate housing affordable to the lowest income seniors and people with disabilities have seen those contracts expire," said Diane Yentel, president and CEO of the National Low Income Housing Coalition. "These contract suspensions put the homes of nearly 70,000 low-income renters at risk, with more contracts expiring every day."

Organizations that administer the HUD funding "are now scrambling to calm down landlords so they don't begin eviction proceedings," said Adrianne Todman, CEO of the National Association of Housing and Redevelopment Officials.

One landlord in Arkansas has already sent a letter to tenants, explaining that they are now responsible for the portion of their rent previously subsidized by the government.

"For most of these tenants, the absence of subsidy means they'll be facing a doubling or tripling of their normal rent payment," said Douglas Rice, a senior policy analyst at The Center on Budget and Policy Priorities.

HUD works with private landlords to subsidize some 1.4 million low-income households, according to the center. If the shutdown continues into March, many more of these tenants could be impacted.

Greene relies on a so-called Section 202 voucher, a subsidy program for low-income seniors. There are 400,000 households covered under the program; and nearly a fifth are older than 85, according to Linda Couch, vice president of housing policy at LeadingAge.

The shutdown's effects on affordable housing could be felt long after Washington resumes operations, experts say, since it will make it harder than it already is to get landlords to participate in government assistance programs, Todman said. "This has demonstrated to potential and existing landlords that sometimes the money is not a sure thing," she said.

Hugh Cobb, who manages some 30 properties in Texas funded by HUD vouchers, said he might not receive the government subsidies for the units in February. "The hope dwindles each day," he said.

If the money doesn't come, Cobb said, he and other property managers might have to delay their mortgage payments "in an effort to keep the properties operating and caring for the residents."

Greg Brown, senior vice president of government affairs at the National Apartment Association, said he's heard from a member who was in the process of adding three new properties to the HUD system but is now stuck waiting.

"Projects that are already out there might not be receiving their funds," Brown said, "and then you have new units that could be coming on board that are now on hold. Those are affordable units that are not available."

He continued, "As the shutdown goes on, the problem becomes bigger and bigger."

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