HomeMy WebLinkAboutAgenda - 11-19-2002-9dORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: November 19, 2002 Action Age da
Item No. _
SUBJECT: Section 8 Project Based Voucher Pro ram Polic
DEPARTMENT: Housing/Comm. Development PUBLIC HEARING: (YIN) No
ATTACHMENT(S): INFORMATION CONTACT:
Tara L. Fikes, ext. 2490
Section 8 Program Status Report TELEPHONE NUMBERS:
Proposed Policy
Hillsborough 732-8181
Chapel Hill 968-4501
Durham 688-7331
Mebane 336-227-2031
PURPOSE: To consider approval of a Section 8 Project Based Voucher Program Policy under
the County's Section 8 Housing Voucher Program.
BACKGROUND: The Housing and Community Development Department administers the
Section 8 Housing Voucher Program for Orange County. This program provides rent subsidies
to low income families renting standard property throughout the County. Funding for the
program comes from the U.S. Department of Housing and Urban Development (HUD).
Currently, the program has budget authority to provide rent subsidies for approximately 623
families. The total number of families served by the program has not changed over the last five
years due to the lack of growth in the national program.
In October 2001, the Department temporarily suspended the acceptance of applications for
housing assistance under the Section 8 Program due to an existing waiting list of approximately
1,000 families, which translates into a four (4) to five (5) year waiting list. At the October 15,
2002 BOCC meeting, Chris Moran of Inter-Faith Council asked the Board of Commissioners to
direct staff to reopen the Section 8 waiting list, purge the waiting list, and to establish
preferences for applicants to the Section 8 Program. In response, staff has prepared a report
on the current overall status of the program.
Additionally, in anticipation of the potential future development of rental housing complexes for
families and individuals with special needs, department staff is recommending the
establishment of a policy for a Project Based Section 8 Program. HUD requires that this policy
be approved by the Board of County Commissioners prior to implementation. More specifically,
a project-based program will provide for the allocation of Section 8 assistance to existing or new
dwelling units serving persons with disabilities with incomes less that 50% of the median
income. This is in contrast to the current tenant-based program that allows low-income persons
to receive rental subsidy regardless of location as long as the unit meets Housing Quality
Standards.
It is important to note that any designation of existing vouchers as project-based vouchers will
be done from our existing voucher pool and does not represent a new allocation of vouchers.
Also, given that the current program is at capacity, Orange County will only be able to
implement this program by using vouchers that become available in the future due to participant
turnover and the acquisition of new vouchers. Nonetheless, because project based vouchers
can be important to the feasibility of special needs rental housing projects, the County should
be proactive in establishing a system now in order to be able to immediately implement this
program should additional vouchers become available. It is recommended that no more than
50 units be designated under this program at this time. This will allow the support of
approximately two rental projects at 25 units as a pilot program.
FINANCIAL IMPACT: The program will be financed by the current Section 8 Program budget
authority.
RECOMMENDATION(S): The Manager recommends approval of a Section 8 Project Based
Voucher Program Policy under the County's Section 8 Housing Voucher Program.
Orange County Section Eight Housing Voucher Choice Program
Status Report -November 2002
The Section 8 Housing Choice Voucher Program is a federally funded rental assistance program
administered by public housing authorities (PHAs) or other government agencies. The programs'
primary purpose is to provide rental assistance to low-income families with affordable decent,
safe, and sanitary housing. Tenants' take the voucher/certificate and uses it to rent homes in the
private market. The programs were authorized by the U.S. Housing Act of 1937 Section 8 (b) (1)
and Section 8 (o), hence the name "Section 8".
Families interested in the program apply to a local housing authority or other government agency
for a Section 8 tenant-based voucher- a voucher that "stays" with the tenant. A family is
ineligible for the program if more than 40 percent of its income has to be used to pay rent in the
first year. Currently, Section 8 helps more than 1.4 million households in the United States by
paying private landlords the difference between what the household can afford and the rent for
the unit. In Orange County, the program is administered by the Orange County Housing and
Community Development Department.
The administering housing authority or government agency is also responsible for inspecting the
selected housing unit to make sure it complies with the Housing and Urban Development's
(HUD) Housing Quality Standards and ensuring that the rent charged is reasonable for the local
housing market.
The following information provides summary information regarding the current status of the
Section 8 Program in Orange County.
Funding Capacity
The U.S. Department of Housing and Urban Development provides funding for the Section 8
Program. The approved Section 8 budget for Fiscal Year 2002-2003 is $3,727,944 or $310,662
per year. This budget authority is projected to fund approximately 623 units. However, due to
increasing rental rates and the bedroom composition of our participants our actual costs are
beginning to exceed the budget authority, thereby, necessitating a need to request amendment
funds from HUD. The necessary funds have been granted to date in order to allow us to meet
our expenses, however, a pending Congressional Bill, if passed, may radically change HUD's
budgeting practices.
Current Program Characteristics
~ Approximately 269 property owners lease property to 623 on average.
~ The majority of the rental units are in the Carrboro/Chapel Hill area (Southern
Orange County).
~ Racial family composition: approx.60%Afrkan-American; 37% Caucasian; 3%
Other.
~ Most non-elderly heads of households are working families.
~ Most families lease two-bedroom units.
~ Current waiting list totals 1,020 families and was closed to new applicants in
October 2001.
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W aiting. List
There are approximately 1,020 families on the current waiting list. In October 2002, the
Department suspended receipt of new applications because of the anticipated lengthy wait for
assistance -three to four years. The waiting list was last purged in the year 2000. The oldest
application date on the waiting list is from 1993 (a family without preferences).
The program presently has maintained the following Waiting List Preferences for the applicants
that are:
a. Involuntary displaced;
b. Living in substandard housing to include homeless families;
c. Paying more than 50% of their income for rent and utilities; and
d. Elderly and/or Disabled.
Additionally, the program has the following Local Preferences for:
a. Families who live, work, or have been hired to work in the jurisdiction.
b. Families who are graduates or participants in an education and training program
to prepare for self-sufficiency.
c. Graduates of transitional housing programs for homeless persons; substance
abusers; and victims of domestic abuse.
Of the 1,020 current applicant families on the waiting list:
• 435 (43%) have preferential placement
• 105 have the rent burden preference (>50%)
• 79 have the substandard/homeless preference
• 17 have the involuntarily displaced preference
• 292 are elderly and/or disabled
Staff Res onse to the October 15 2002 InterFaith Council Petition
1. Remove the freeze from on Orange County's Section 8 Program
The waiting list was closed in October 2001 because the average waiting time for current
applicants on the waiting list was 4-5 years. (This was based on turnover of approximately 150-
200 families each year.) With such a massive waiting list and associated waiting period,
department staff considered it unfair to continue to accept applications when rental assistance
may be years away. At that time the Greensboro office of HUD was consulted and they
concurred with our assessment.
In retrospect, since between October 2001 and August 2002, there was no significant turnover in
the program and thus no available vouchers. Therefore, we were not able to select any applicants
from the waiting list for potential assistance. It has been only in the last 30 - 60 days that there
has been sufficient turnover to warrant selecting applicants from the waiting list for vouchers that
have become available due to participant moves and terminations.
Thus, based on the aforementioned facts and the following critical points, staff does not
recommend opening the Section 8 waiting list at this time. This decision should be reassessed
during the last quarter of the year after analyzing our turnover rate in the current fiscal year.
Critical Decision Points:
• Opening the waiting list raises untrue expectations for assistance in a timely manner
particularly given the winter season (the most needy season) is approaching soon.
• False hopes lead to irate clients increasing staff security concerns.
2. Purge and clean-up the existing list to a manageable number.
The waiting list was last purged in the Fa112000. It is customary that most housing authorities
purge the list every two -three years. Since the County has not accepted applications for the last
year, we essentially still have atwo-year old waiting list. It is anticipated that it would be
disastrous to purge the list with a closed waiting list thereby not allowing applicants an
opportunity to reapply for assistance should they be purged from the list. Further, if we purge
the list by asking if clients are still interested in the program, that prompts the question that we
still cannot answer honestly -When will I receive assistance? Therefore, logistically purging
should occur at a time that the waiting list is open.
Thus, based on the aforementioned analysis, staff does not recommend purging the Section 8
waiting list at this time. This conclusion should be re-examined at the time of waiting list
review.
3. Based on your discretion and authority, create wait-list preferences for people who are
homeless, people living in substandard housing; people paying more than fifty percent of income
for rent and people with disabilities.
The County's Program currently has these preferences as described above under the Waiting List
section.
4. Consider requesting more "set aside "funds appropriated by Congress for "veterans,
families reunifying with their children, families moving from welfare assistance to employment,
and people with disabilities.
The County currently actively seeks funding for new vouchers as they become available. Two
(2) unsuccessful applications were submitted during this calendar year. The number of vouchers
available nationwide has decreased or remained stable while the need has continued to grow
thereby fostering a stiff competition for available resources. The County and its non-profit
collaborators should continue to pursue Congressional increases for the Section 8 Program in
order to meet our local needs.
Additionally, this same group should voice opposition to such proposed legislation as House Bill
5605 which categorically changes the Section 8 renewal funding formula in a manner that could
have several unintended consequences including reducing local program sizes due to funding
constraints.
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PROPOSED POLICY FOR SECTION 8 PROJECT BASED VOUCHER PROGRAM
Orange County Housing and Community Development Department
Purpose: To encourage production of new affordable rental housing in Orange County by
private for-profit and non-profit or eaniof Housin e andaCommunity Developmen ~is request ng
through the Orange County Departm g
approval from the U S. Department of Housing and Urban Development to implement a program
of Project Based Vouchers (PBV) for up to 50 dwelling units.
TarEetin~: The Project Based Section 8 Assistance proposals must be targeted for citizens
with disabilities at incomes at or below 50 percent of the Area Median Income. The proposals
must include provisions for supportive services for the disabled citizens that will help them to
remain in independent living. All units must meet the HUD Housing Quality Standards and HUD
Site and Neighborhood Standards.
AdvertisinE: The Request for Proposals advertisement will run once a week for three
consecutive weeks (a minimum of twenty-one (21) days) and will describe the application
process and specify the number of units the Orange County Department of Housing and
Community Development will be able to assist. Only applications submitted in response to this
advertisement will be considered. All advertising will be consistent with the Orange County
Department of Housing and Community Development's Fair Housing Plan as approved by the U.
S. Department of Housing and Urban Development (HUD).
Advertisements will be in the format attached and will:
1) Run in the Chapel Hill Herald and the News of Orange County, which are
newspapers of general circulation in Orange County.
2) Run once a week for three consecutive weeks, specify the number of PBV units, and
first published following HUD's approval to implement a project based program; and
3) Have the deadline for acceptance of owner applications established as thirty days
after the date the advertisement is last published.
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