From the you can’t make this stuff up file …
A recent HUD IG report identified “families earning more than the maximum income for government-subsidized housing as an egregious abuse of the system. “
Some examples in the Washington Post:
- A New York City family making $497,911 a year pays $1,574 a month to live in public housing in a three-bedroom apartment subsidized by taxpayers.
- A tenant with assets worth $1.6 million — including stocks, real estate and retirement accounts — pays $300 for a one-bedroom apartment in public housing in Oxford, Neb.
These are extreme cases, but they’re not alone: about 2.5% of the 1.1 million families in the country who live in public housing have incomes over the HUD maximums.
So, why is this happening and what is HUD doing about it?
Short answer on why: It’s the way the rules are written.
Short answer on what’s HUD doing about it: NOTHING !
First, on the “why?” …
HUD has pretty reasonable entry requirements for public housing residency.
According to WaPo:
HUD sets the low-income limits at 80 percent and very low-income limits at 50 percent of the median income for the local area. The agency sets “fair market rents” every year based on incomes, housing demand and supply.
So, what’s the rub?
Note the above emphasis on “entry requirements”.
“Under HUD regulations, public housing tenants can stay as long as they want, no matter how much money they make, as long as they are good tenants. The agency is only required to consider a tenant’s income when an individual or family applies for housing, not once they’re in the system.
In other words, once a family gets into the program, it can stay on the program even if its income blows past the statutory maximum.
Even if it blows past the max but a lot.
So, what’s HUD doing about this apparent loophole is the system?
HUD says that “evicting over-income families could negatively affect their employment and destabilize properties.”
More specifically, HUD has no plans to evict these families, because if they did, “poverty would continue to be concentrated in government-subsidized housing. There are positive social benefits from having families with varying income levels residing in the same property. Tenants who are making good money to serve as role models for others.”
Side note: There are long waiting lists of “real” poor families trying to get into these public housing residences.
Now, according to the WaPo:
“In response to reports of an unsparing audit by its watchdog, the Department of Housing and Urban Development has flipped its stance and now says it is urging housing authorities nationwide to evict tenants who earn too much to qualify for government subsidies.
The initiative represents an about-face from the agency’s earlier response to the audit by HUD’s inspector general.”