HUD Secretary Ben Carson smiles as his folds his hands in front of his chest.


HUD Urged to Make Tenant Income Adjustments Automatic by April 1

Preventing catastrophe when eviction moratoriums lift requires reducing tenants' rent quickly—which advocates say is fully within HUD's power.

HUD Secretary Ben Carson. Photo by Gage Skidmore via flickr, CC BY-SA 2.0

HUD Secretary Ben Carson smiles as his folds his hands in front of his chest.

HUD Secretary Ben Carson. Photo by Gage Skidmore via flickr, CC BY-SA 2.0

The CARES Act that was passed last week contains an additional $12 billion for HUD programs, including $1.25 billion for the Housing Choice Voucher program, $1 billion for project-based rental assistance, and $685 million for public housing agencies.

This is sure to be a huge relief to those public housing authorities and owners of HUD-assisted housing that had quickly moved forward with canceling evictions to keep residents in their homes because it was the right thing to do, and were crossing fingers that federal help would come to make up the difference.

However, eviction moratoriums and that federal funding are only part of what public housing residents and HUD-assisted tenants need in order to survive the economic fallout of COVID-19.

What they need right now, say tenant advocates, is for HUD to use its authority to make sure all tenants’ rents go down to match any changes to their incomes, by April 1.

Although an eviction moratorium allows people to shelter in place right now, James Grow of the National Housing Law Project points out that “getting the underlying rent obligations calibrated is really important, because when the emergency ends, people will still owe their rent.”

The National Alliance of HUD Tenants (NAHT), National Housing Law Project, and National Low Income Housing Coalition sent a letter to HUD Thursday, March 26, laying out suggestions for how to quickly and practicably approach tenant income adjustments.

Tenants in income-based programs like public housing and housing choice vouchers already have the right to have their rents changed if they can prove a reduction in income. However, that income adjustment process must be initiated proactively by a tenant, and involves significant documentation and in-person meeting requirements.

However, with the first of the month imminent, and the pandemic causing so many unexpected income losses and medical crises, the three organizations argue that the usual process is nowhere near sufficient to prevent a nightmare of back rent, administrative headaches, and unwarranted evictions down the line.

“They need to clear away the administrative underbrush, immediately,” says Grow, “with clear directives to owners and notices to tenants that income adjustments should be automated.” And if an adjustment can’t happen by April 1, says Grow, which is understandable given the short time frame, there needs to be assurance that it will be made retroactive.

In their letter to HUD, the three organizations suggest that “if rent is not paid when due for April and other months during the emergency (and a reasonable period thereafter), [public housing authorities] and owners should presume that the cause is a reduction in income (a “constructive request”) and begin the interim recertification process.” They also suggest that public housing authorities and owners should accept whatever documentation of loss income the tenant is able to provide, including their own verbal statement, with verification to come later, and call on HUD to waive deadlines on the annual recertification process, requirements for in-person meetings, and documentation standards in order to process these interim income recertifications quickly. Tenants and and owners should also be notified of these changes swiftly and clearly, the letter says.

The advocates are also calling for a reduction of the minimum rent to zero. “The minimum rent requirement was always punitive,” says Michael Kane of NAHT. “Just do an across-the-board waiver. Don’t make people humiliate themselves [with hardship exemption applications] and have owners spend the time trying to evaluate them.”

Allowing an “adjust first and document later” income adjustment protocol would bring standards for renter and homeowner pandemic relief somewhat closer together, since the guidance issued by the GSEs for mortgage forbearance states that no documentation is required at all to set up a mortgage forbearance plan.

Finally, to be meaningful, HUD needs to not only allow these changes, but require them.

“They have the money, they have the authority,” says Grow. Owners “need clarity from the top. Generally it’s a check-the-box kind of system, where people are very afraid of violating rules. They need permission to do the right thing. And they need to know that the housing assistance payment will be adjusted retroactively [to cover their expenses]. That’s what the extra money put into in those systems [by the CARES Act] is for.”

Advocates note that another, administratively simpler, option would be to reduce tenant rent obligations for the coming two months to zero, giving the system time to process all the income recertifications.

NAHT sent a separate letter to HUD earlier last week on this subject that also asked HUD to formally withdraw proposals it has made to Congress to institute work requirements and raise rents to 35 percent of income. “In light of the national emergency, HUD’s proposals appear inappropriately punitive and harsh,” NAHT wrote. “This is not the time to squeeze marginal amounts of income from poor people. . . . It is particularly absurd, if not cruel, to condition the award of subsidies on meeting a work requirement when the economy is contracting by 30-50 percent due to the emergency. We ask HUD to notify Congress it is withdrawing these proposals now.”

A HUD spokesperson said today that the Office of Public and Indian Housing “was granted blanket waiver authority with the supplemental [appropriations legislation] for the first time. We are considering a number of blanket waivers, and other options that will lighten the burden for [public housing authorities] and their residents.”

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