Major Section 8 reform has finally been accomplished. In past years, it has gone by the acronyms of SEVRA, SESA, AHSSIA. But it was HOTMA that got it done, thanks to so many members getting HOT with their own advocacy efforts in support to help see it through to completion.
Unanimous Support from Congress
The Senate passed the Housing Opportunity Through Modernization Act (HR 3700/S 3083) before it adjourned for summer recess. This is a significant victory for housing advocates. The legislation will streamline tenant income determinations and rent setting, and vastly improve the ability to project-base vouchers, among other benefits.
On July 14, the Senate passed HR 3700 under a unanimous consent agreement, meaning there was no opposition to the measure. The House passed the same bill unanimously in February. And the President has now signed it.
Highlights of What Has Been Accomplished
HOTMA protects the lowest income households from steep rent increases and retains the principle that most rents are set at 30% of income. It also streamlines determination of tenants’ incomes and deductions, providing an increase of the standard medical cost deduction (from $400 to $525) and an increase from 3% to 10% of income before unreimbursed expenses would be allowed. The standard deduction is also indexed to inflation.
As an additional safeguard for any unintended consequences, it also requires HUD to establish hardship policies for households unable to pay their rent because of these changes.
It will reduce the frequency of interim income reviews, requiring rents be based on a tenant’s actual income in the previous year rather than projecting income and expenses and allowing use of income data gathered by other programs, and allows project sponsors / owners to rely on determinations of income conducted for other federal means-tested public assistance programs such as Medicaid and the Supplemental Nutrition Assistance Program (food stamps).
It allows local housing agencies to make greater use of project-based vouchers to assist the homeless (as well as veterans, the elderly, and people with disabilities); and revises the rules for inspecting units that families with tenant-based vouchers wish to rent in order to get vulnerable families into homes more quickly, while protecting them from eviction if subsidy payments to an owner are suspended because a unit has developed housing-quality violations.
It erases the cap on the number of project-based vouchers used in a single senior housing community, extending the term for which vouchers can be project-based from 15 to 20 years, and allows housing agencies to permit site-specific waiting lists to be managed by community owners.
It increases the standard income deduction such households from the current $400 to $525 a month, something the Administration proposal did not include, and indexes this deduction to inflation.
And it attempts to target scarce HUD rental assistance to those who need it the most by imposing restrictions on assets for Section 8 and public housing tenants. With this change, a household will be ineligible for assistance if they have more than $100,000 in assets or a home they could otherwise live in.
Preparing for the Coming Changes
There are numerous changes that will occur once the law is fully implemented. A detailed comparison chart between currently policy and the changed law has been done by the Center for Budget and Policy Priorities. How and when the various provisions will be implemented will take some time to figure out. But now is the time for providers to be asking questions, and suggesting ways policies can or will need to be changed.
This article is a portion of an article written by Colleen Bloom and published by LeadingAge National. View the entire article.
