More About Douglas Rice

Douglas Rice

As a Senior Policy Analyst, Rice's work focuses on the impact of federal housing policy on low-income families.

Full bio and recent public appearances | Research archive at CBPP.org


Better Federal Policy Needed to Address Rental Affordability Crisis

July 2, 2014 at 4:24 pm

Housing has become increasingly unaffordable for many Americans, especially those with the lowest incomes, as a recent report from Harvard’s Joint Center for Housing Studies documents and I pointed out earlier this week.  And federal policy is helping fewer families meet this challenge.  The number of households experiencing “worst-case needs” ­— those with very low incomes that pay more than half their income toward housing or live in severely inadequate housing — has risen dramatically, but the share of households eligible for assistance that receive it has fallen to just 23 percent (see chart).

These trends have significant negative consequences for low-income families, as Harvard’s report details.  To afford housing, they may be forced to live in neighborhoods with high crime rates or in inadequate housing.  Families that pay more than half their income for housing also spend far less on other basic needs, including 39 percent less on food, 65 percent less on health care, and 66 percent less on transportation, than families with affordable housing.

Federal rental assistance is a lifeline that can help prevent those kinds of negative results for low-income families.  About 5 million low-income households receive assistance to afford decent, stable, modest housing while paying about 30 percent of their income toward rent.  Rental assistance programs reduce poverty, homelessness, and housing instability, and help families afford decent quality housing in safer neighborhoods.

Nevertheless, Congress has cut these programs in recent years.  Between 2010 and 2014, Congress cut funding for Housing Choice Vouchers by $528 million, public housing by almost $1.6 billion, and housing for the elderly and people with disabilities by almost $600 million, adjusted for inflation.  These cuts have kept tens of thousands of eligible families from receiving rental assistance.  As we’ve explained, for example, last year’s sequestration cuts dropped the number of families using Housing Choice Vouchers by more than 70,000.

Unfortunately, Congress may provide little relief in the 2015 budget.  While Congress provided sufficient funding in 2014 to restore half of the vouchers lost to sequestration, the 2015 spending bills that the House recently approved and the Senate may consider this summer fail to renew those restored vouchers.  Congress can and should do more to help low-income families live in safe and affordable homes.

New Report Documents Growing “Crisis of Affordability” for Renters

June 30, 2014 at 3:59 pm

More than 80 percent of households earning under $15,000 a year — roughly equivalent to full-time work at the minimum wage — paid more than 30 percent of their income for housing in 2012, a new report by Harvard’s Joint Center for Housing Studies finds.  The federal government and many private-sector landlords and lenders consider housing unaffordable if it exceeds 30 percent of household income.

The shortage of affordable housing, which is hitting the lowest-income families the hardest, seems to be growing worse.  The number of households earning under $15,000 paying more than half of their income for housing jumped by over 2 million from 2002 to 2012 (see chart).  In fact, in that latter year, 69 percent of households earning under $15,000 paid more than half of their income for housing.

The report documents a growing “crisis of affordability” for renters, driven by a widening gap between rental costs and renter incomes.  The gap began growing well before 2007 but worsened during the Great Recession.  The median renter income plummeted 13 percent between 2001 and 2012, while median rents rose 4 percent.

Federal policymakers have made things worse by cutting rental assistance.  For example, the number of families using Housing Choice Vouchers, the most common form of federal rental assistance, fell by more than 70,000 in 2013 due to across-the-board sequestration cuts.  Congress provided funds to restore up to half of these vouchers in 2014, but the 2015 spending bills that the House and Senate appropriations committees have approved for the Department of Housing and Urban Development don’t renew all of those vouchers and risk locking in the full sequestration cuts.

Some 5 million low-income households receive federal rental assistance, mostly working families with children, seniors, and people with disabilities.  Studies show that vouchers and other types of rental assistance are extremely effective at reducing poverty, homelessness and housing instability.  With a stable home — the foundation necessary for families to thrive —becoming unaffordable for more Americans, policymakers should be strengthening these programs, not cutting them.

Update: Senate Housing Bill Improves on House But Still Would Lock in Large Voucher Losses

June 6, 2014 at 3:52 pm

The 2015 funding bill for the Departments of Transportation and Housing and Urban Development (HUD), which the Senate Appropriations Committee approved yesterday, is a significant improvement over its House counterpart but still falls short in major respects.

As we’ve reported, the across-the-board sequestration cuts eliminated housing vouchers for some 70,000 low-income families in 2013.  Congress provided enough funding in 2014 to restore roughly half of those lost vouchers.

But the 2015 spending bill that the House Appropriations Committee approved on May 21 would likely lock in the loss of more than 70,000 vouchers in 2015.  The Senate bill provides only $26 million more than the House bill to renew vouchers in use in 2014.  This means that, like the House bill, the Senate bill provides enough funding to renew all vouchers in use this year only if housing agencies either don’t use their available 2014 funds to restore lost vouchers this year or freeze subsidies in spite of rising rent and utility costs.

In other words, the bill would either lock in the loss of more than 70,000 vouchers (see graph) or require families with meager resources to absorb significant increases in housing costs next year.

Also like the House bill, the Senate bill would make little progress against homelessness.  While both bills include $75 million for new rental assistance for homeless veterans and the Senate bill raises homeless assistance grants by $40 million over last year’s level, the latter is only enough to renew existing grants.  And any progress against homelessness is doubtful if Congress locks in sequestration cuts in vouchers, which are an important part of state and local efforts to reduce homelessness.

In some other areas, the Senate bill made significant improvements over the House bill with the roughly $1 billion more for HUD housing and community development programs it had available.  (The Senate Appropriations Committee allocated $2.4 billion more for the Transportation-HUD bill as a whole than the House did.)  The key areas of improvement include:

  • $6.38 billion for public housing operations and capital needs, $200 million more than the House bill and $100 million above the 2014 level.  The Senate bill also raises to 185,000 the number of public housing units authorized to participate in the Rental Assistance Demonstration and provides $10 million in new funding for this promising initiative, which enables public housing agencies to obtain more private capital for repair needs.  And it provides $90 million ($65 million more than the House bill) for the Choice Neighborhoods Initiative to revitalize public housing, other assisted housing, and surrounding distressed neighborhoods.
  • $1.55 billion for state and local agencies to administer vouchers, $205 million more than the House bill and $55 million above the 2014 level.  While the Senate funding level is still $150 million below the President’s request, the added funding over the House level is important to enable agencies to run the voucher program effectively.
  • $950 million ($250 million more than the House bill) for the HOME Investment Partnerships program, which helps states and localities develop and preserve homes for lower-income owners and renters.

To be sure, Congress faces severe budgetary constraints in writing the fiscal year 2015 appropriations bills.  Yet policymakers should place high priority on protecting key safety net programs, including rental assistance programs — which enable more than 5 million low-income families to avoid homelessness and other hardships.

Congress should do more to protect low-income families as the House and Senate bills move forward in the next two weeks.

Senate Housing Bill Improves on House But Still Risks Locking in Large Voucher Losses

June 4, 2014 at 1:49 pm

The 2015 funding bill for the Departments of Transportation and Housing and Urban Development (HUD), which a Senate appropriations subcommittee approved yesterday, is a significant improvement over its House counterpart but still falls short in major respects.

As we’ve reported, the across-the-board sequestration cuts eliminated housing vouchers for some 70,000 low-income families in 2013.  Congress provided enough funding in 2014 to restore roughly half of those lost vouchers.

But the 2015 spending bill that the House Appropriations Committee approved on May 21 would likely lock in the loss of more than 70,000 vouchers in 2015.  It also makes significant cuts in other important low-income housing programs, such as in funding to repair public housing.

The Senate Appropriations Committee set better priorities, allocating $2.4 billion more for the Transportation-HUD bill than the House did, including roughly $1 billion more for HUD housing and community development programs.  The Senate bill’s key areas of improvement over the House bill include:

  • $6.38 billion for public housing operations and capital needs, $200 million more than the House bill and $100 million above the 2014 level.  The Senate bill also raises to 185,000 the number of public housing units authorized to participate in the Rental Assistance Demonstration, a promising initiative that enables public housing agencies to obtain more private capital for repair needs.  And it provides $90 million for the Choice Neighborhoods Initiative to revitalize public housing, other assisted housing, and surrounding distressed neighborhoods, $65 million more than the House bill.
  • $2.15 billion for homeless assistance grants, $40 million above the House bill and the 2014 level.
  • $950 million for the HOME Investment Partnerships program, which helps states and localities develop and preserve homes for lower-income owners and renters; that’s $250 million more than the House bill.

But, like the House bill, the Senate bill appears to provide enough funding to renew all vouchers in use this year only if housing agencies either don’t use their available 2014 funds to restore lost vouchers this year or freeze subsidies in spite of rising rent and utility costs.  In other words, the bill would either lock in the loss of more than 70,000 vouchers or require families with meager resources to absorb significant increases in housing costs next year (see graph).

Also, the Senate bill would make little progress against homelessness.  While it includes $75 million for new rental assistance for homeless veterans, the above-mentioned $40 million increase in homeless assistance grants is only enough to renew existing grants.  And any progress against homelessness is doubtful if the sequestration cuts in vouchers are locked in.

To be sure, Congress faces severe budgetary constraints in writing the fiscal year 2015 appropriations bills.  Yet policymakers should place high priority on protecting key safety net programs, including rental assistance programs — which enable more than 5 million low-income families to avoid homelessness and other hardships.

Congress should do more to protect low-income families as the House and Senate bills move forward.

House Funding Bill Disproportionately Cuts Assistance to Low-Income Renters

May 22, 2014 at 4:26 pm

An unexpected decline in the Congressional Budget Office’s projection of mortgage credit program receipts has tightened the already severe fiscal constraints that Congress is facing in writing the fiscal year 2015 appropriations bills.  But rather than protect key safety net programs — including rental assistance programs that enable more than 5 million low-income families to avoid homelessness and other hardships — the House Appropriations Committee yesterday approved a Transportation-HUD (THUD) spending bill that makes disproportionately deep cuts in housing assistance for low-income households.

The House THUD Subcommittee asserted in a May 6 press release that the Housing Choice Voucher funding in the bill “will provide for continued assistance to all families and individuals currently served by this program.”  As our new report makes clear, however, this can be true only if one of two unfortunate developments occurs:  first, if housing agencies do not use the funds available in 2014 to restore any of the 70,000 housing vouchers that were cut in 2013 due to sequestration; or second, if housing agencies freeze voucher subsidies in spite of rising rent and utility costs.

In short, the House bill will not be sufficient to serve the same number of low-income people unless the sequestration cuts of 70,000 vouchers for low-income families are locked in (see chart), or low-income families absorb significant increases in housing costs over the next year, effectively pushing them deeper into poverty with respect to other household needs.

The bill would also stall recent progress on reducing homelessness and continue and deepen the shortfalls in public housing.

The Senate has taken the first step toward better results by allocating $2.4 billion more to the THUD bill than the House did.  To protect low-income families, Congress should at least meet the President’s request for funding for Housing Choice Vouchers, public housing, and homeless assistance grants, and should seek additional funds to restore to use the remainder of the 70,000 housing vouchers that were cut last year due to sequestration.

Click here to read the full paper.