It’s 1:30 on a wintry March afternoon, and Rochelle Johnson is just sitting down at the table in the dining room of her snug four-bedroom Arbor Heights bungalow for a late lunch of pasta and shrimp. The meal is a short respite in a daily schedule that consists mostly of running from place to place—getting her four kids to school and driving to classes in North Seattle in her weathered maroon minivan, then doing the whole thing in reverse, scooping up the kids and getting home in time to put dinner on the table.
Johnson’s story seems like a classic by-the-bootstraps tale of triumph over adversity. The single mom pulled herself off welfare, moved out of the Holly Park public housing complex in Southeast Seattle, and is working to improve her financial situation, taking time off from her job as a kidney dialysis technician to go to nursing school. It’s true that her quiet neighborhood, near the southwest tip of West Seattle, has seen better days. It’s a remote, secluded place where gas stations share street-front space with vegetable markets and down-at-the-heels 1960s wood-frame homes. But it’s about as far away from Holly Park as a suburban shopping mall is from a downtown minimart, and Johnson likes it that way.
Johnson came here to make a fresh start in 1996, shortly before Holly Park was torn down for renovation by the Seattle Housing Authority (SHA) under a federal program known as HOPE VI, which gives grants to local housing authorities to demolish public housing projects and redevelop them into mixed-income inner-city communities. Johnson had wanted to get out of the projects and into “regular” housing for a long time; before Holly Park was torn down, she had spent years waiting to get a housing voucher under a federal program called Section 8, which gives working poor people assistance with their monthly rent and utility bills. The planned demolition pushed Holly Park residents to the top of the list.
So why does Johnson feel cheated? She says the housing authority, which distributes the Section 8 vouchers, did nothing but stand in her way when she tried to move away from public housing and toward self-sufficiency. After she got her voucher, Johnson says, she found herself spending more than 40 percent of her monthly income on rent and utilities, even though federal law says tenants displaced from public housing can pay no more than 30 percent. When she pointed out the discrepancy, SHA disputed her income and insisted that she was ineligible for the lower limit. Instead of encouraging self-sufficiency, Johnson says, SHA was creating an incentive for her to cheat the system. “I was working full time, and my [portion of the] rent kept going up, going up, going up,” Johnson says—to $736 a month in 2000 and to $918 in 2001. Finally, last year, Johnson quit her $23,000-a-year job as a kidney dialysis technician. Now SHA pays her entire rent of $1,450 a month.
Johnson’s case is part of a federal complaint against the agency and the regional office of the U.S. Department of Housing and Urban Development (HUD) filed on Wednesday by the Seattle Displacement Coalition, an advocacy group for low-income tenants, on behalf of six Section 8 voucher recipients. Her situation illustrates some of the pitfalls that have accompanied a shift in the government’s approach to low- income housing from “dependence” on public housing to “self-sufficiency” in the private market, a change that’s happening not just in Seattle but all around the country.
LEFT BEHIND
These days, no one talks about going back to the days of public housing when crumbling inner-city tenements became symbols of a federal bureaucracy that gave its intended beneficiaries a place to live, but no services or assistance to pull themselves out of poverty. Today’s typical public housing complex will likely include child-care assistance, a job-training facility, and a community center alongside a mix of owner-occupied and rented homes. Holly Park, the first project to go under the HOPE VI knife in Seattle, is designed on this model. The idea is to deconcentrate poverty and create vibrant, diverse mixed-income communities by mixing homeowners and tenants, black and white, poor and middle class. At the same time, city housing authorities are using Section 8 vouchers to move former public housing residents into apartments in the private market. The goal: to rebuild the nation’s low-income housing from the ground up, starting with the definition of “low-income housing” itself.
HOPE VI’s rapid development can be seen as evidence that the program works. It has been nothing if not prolific—HUD has handed out nearly $5 billion in grants for HOPE VI redevelopments from Buffalo to Memphis since its inception in 1993. Seattle has proved especially adroit at sucking HOPE VI dollars out of the federal trough. No fewer than three major redevelopments of 1940s-era public housing projects are in the works, with one—NewHolly, the former Holly Park—nearing completion.
But as with welfare reform, which left thousands to fend for themselves with poverty-level jobs when their benefits dried up, public housing reform hasn’t always worked out as planned. According to advocates like John Fox of the Displacement Coalition, projects like NewHolly do nothing for the hundreds of people displaced when their homes are demolished, many of whom never return to enjoy the project’s new job-training facility, computer lab, or community center. And programs like Section 8, Fox argues, present working poor people with a Hobson’s choice: Move out of town, where rents are cheap, or pay more than you can afford.
The Displacement Coalition’s complaint touches on almost every aspect of the new housing philosophy. It alleges that some 3,100 recipients of Section 8 vouchers were systematically underpaid by SHA for their housing and utility expenses, concentrating them into new pockets of poverty on the southeast and southwest fringes of Seattle’s city limits.
To understand the complaint, it helps to know a little about the Section 8 program. Section 8, much like public housing, is aimed at the very low-income and “working poor”: Only people making less than 50 percent of an area’s median income are eligible, and most Section 8 vouchers are reserved for people making less than 30 percent of the median (in Seattle, that means less than $16,350 for one person). Under federal rules, housing authorities are supposed to give Section 8 clients a monthly allowance, called a voucher, to find housing on the private market. Housing authorities set a “payment standard”: the maximum amount that a person can receive in voucher assistance. In Seattle, the maximum payment for a one-bedroom apartment was recently raised from $582 to $650 a month; the maximum for a four-bedroom like Johnson’s is now $1,500. That may sound like a lot, but most people don’t get the maximum; voucher recipients have to pay at least 30 percent of their income on rent, so about the only way to get the maximum payment is to have no income at all. The idea is to keep people afloat—not give them a free ride.
Generally, housing authorities are required to set the payment standard high enough so that voucher recipients don’t spend more than 40 percent of their monthly income on “gross rent,” or rent and utilities (30 percent is considered ideal). The Displacement Coalition believes that by setting its payment standards low for the Seattle market (according to apartment consultants Dupree + Scott, the average rent for a one-bedroom apartment in King County in October was $777), SHA has allowed many of its clients to pay more rent than they can afford. Those who do find affordable apartments, the coalition believes, find them in areas like White Center, Delridge, and the Rainier Valley, where a large number of very-low-income people are concentrated. The allegations, if proved true, could constitute a violation of federal fair-housing laws, which say housing agencies and HUD are supposed to ensure that low-income housing is dispersed throughout the city.
The fair-housing component of the complaint may be the easiest to demonstrate. Since the projects were built starting back in the 1940s, the federal government’s philosophy toward low-income housing has undergone a seismic shift. Instead of herding poor people into massive public housing projects, housing agencies are under a new mandate to spread housing opportunities throughout the city, increasing diversity and preventing the development of new urban ghettos. Whether this notion constitutes good public policy or paternalistic social engineering has become largely irrelevant; the question now is: Are the new housing policies accomplishing this goal?
According to data collected by the coalition, SHA’s Section 8 program may be doing the opposite. A map plotting voucher recipients by address shows that Section 8 clients are clustered tightly in lower-income areas like Southwest and Southeast Seattle, while affluent areas like Magnolia and Wallingford are virtually bare. Using the map along with census data detailing the racial and income makeup of areas with large numbers of voucher recipients, the Displacement Coalition determined that poor and minority voucher recipients have overwhelmingly been pushed into pockets of poverty far away from central-city jobs and services. “They’re flouting the rules and accentuating racial segregation,” Fox says.
BALANCING ACT
But fair housing is only one branch of the problem. The root, Fox believes, is SHA’s low payment standards, which the Displacement Coalition has spent years trying to get the agency to raise; today, thanks in large part to the coalition’s efforts, they’re higher than they’ve ever been.
Ordinarily, housing agencies are held to the federal rule that says voucher recipients can’t spend more than 40 percent of their income on gross rent. But SHA says that because of its special status as a Moving to Work agency, a designation that frees it from many federal regulations, it doesn’t have to ensure that tenants stay under that limit. The policy, according to a HUD spokesperson interviewed several months ago (HUD did not return calls for comment for this story), is meant “to allow tenants, particularly in high-rent areas, to be able to find housing.”
Fox calls that a gross violation of both the letter and the spirit of the program. “There is nothing in the Moving to Work agreement that says they can charge more than 40 percent for [gross] rent,” Fox says. What’s indisputable is that, for at least the last two years, SHA has done exactly that. According to SHA’s own records, about 43 percent of its clients were paying more than 40 percent of their income on gross rent before the new payment standards went into effect this January, and around 70 percent were paying more than 30 percent.
One Section 8 client associated with the complaint, who wanted to remain anonymous, has had to set aside as much as 92 percent of her income to pay for rent and utilities. The client, who has lived in the same three-bedroom house for nearly 20 years, says things have changed since she first entered the program in 1983. “When I got on housing, they told me that this is [supposed to help] people get ahead—it’s to give you a little cushion,” she says. But recently, she says, that cushion has gotten thinner and thinner. The client says that when she started the program, SHA paid most of her rent, which was around $700 a month. Now that her kids are gone, she gets less assistance and the payment standard has failed to keep up with her monthly expenses. These days, she pays around $300 a month—more than half her monthly unemployment income of $516. “I am responsible. I don’t go out and buy clothes. I have a used car,” she says. “I’m not spending money. But it takes most of my income to live here.”
SHA spokesperson Virginia Felton says that the payment standard is generally set at a level that, in theory, makes 40 percent of the available housing affordable to voucher recipients. However, “that doesn’t mean that people with vouchers are going to find those type of apartments,” she says.
SHA deputy executive director Al Levine says higher costs are the tradeoff tenants have to pay for living in a high-rent area like Seattle. “We do have a balancing act between what Section 8 people can pay and how many [vouchers] we have available,” Levine says. “We don’t want to just raise allowances without increasing the number of vouchers.”
Part of the problem, Levine believes, lies in voucher recipients’ insistence on picking apartments they can’t afford. “If you have a family that chooses to pay more, that’s the choice part of the program”—the part that says families should be able to live where they want, Levine says. “It’s my opinion that people need to take more responsibility for their decisions. The whole philosophy of the program is self-sufficiency and choice.”
FOLLOWING THE MONEY
It’s not as if SHA needs to scrimp on its Section 8 payments because it’s hurting for money. As of last June, the agency had invested around $29 million in a statewide investment pool for “surplus” dollars—$23 million more than the King County Housing Authority, which serves almost as many clients. Last year, Felton says, SHA earned around $934,000 from its state investments; currently, it has around $17 million in the fund.
Whether a million dollars is too much profit for a housing agency that’s supposed to spend most of its money helping low-income residents is debatable; as far as the Displacement Coalition is concerned, any “surplus” money should go to pay for Section 8, which has a waiting list five or six years long. What is clear is that, like other housing agencies across the country, SHA’s mission has changed: instead of simply housing the poor, SHA is working to promote a broader range of housing strategies including home ownership, market-rate housing—the “mixed” part of New- Holly’s “mixed-income community”—and private-market rentals.
Levine says that SHA is just following the trail of federal dollars, which more and more leads away from things like low-income public housing and toward programs like Section 8, HOPE VI redevelopments, and programs that encourage the dispersal of low-income residents throughout the city. “Congress hates public housing. The public doesn’t like public housing. There’s steadier, more stable resources” for programs such as Section 8 that focus on private housing and self-sufficiency, Levine says. Between 1999 and 2002, the number of public housing units in Seattle was expected to decline from 6,258 to 5,230, while the number of Section 8 vouchers was expected to increase from 4,685 to 8,212, according to SHA’s Moving to Work annual plan.
AFFIRMATIVE STEPS
Since the Displacement Coalition started putting together its complaint, SHA’s Section 8 program has gone through some significant reforms. Last October, Levine says, SHA adjusted its payment standards—from 100 percent of fair market rent to 110 percent. In addition, “we are much more restrictive on going over 40 percent than we were last year,” Levine says.
But critics point to agencies like the King County Housing Authority (KCHA) as examples of how SHA could accomplish its mission of self-sufficiency without leaving its poorest clients behind. Unlike SHA, King County has raised its payment standard above 110 percent in expensive areas like Bellevue, Redmond, and Kirkland. KCHA also ensures that its clients pay no more than 40 percent of their income as gross rent, according to Graeme Atkey, KCHA’s Section 8 manager. Fox says SHA should do the same, raising its standard to a level more in keeping with Seattle’s high housing prices. Columbia Legal Services attorney Steve Frederickson, who represents low-income people, agrees that raising the standards would be a better solution than allowing people to pay more than they can afford. “My feeling is that the payment standard that the housing authority is using is too low for this market, and that the answer to that problem . . . is to increase the payment standard so that more low-income families can afford to live here.”
SHA’s Levine says the agency considered implementing higher payment standards in some areas, especially in North Seattle where housing prices are higher, but were stymied by the prospect that they could be accused of redlining, or paying less for certain “less desirable” areas, usually those with higher concentrations of low-income people and minorities.
Raising the standards, Fox says, would go a long way toward giving SHA’s clients a toehold in a shaky rental market. But the Displacement Coalition doesn’t want it to stop there: The group would like SHA to start tracking where all Section 8 clients go and how much they pay to make sure that Section 8 clients aren’t being ghettoized by their low-income status, and to ensure that everyone who has to leave a public housing complex gets full payment and relocation services, not bureaucratic hassle. Ultimately, Fox says, if the complaint changes SHA policies even incrementally, it will have been worth the effort. “This kind of exposure has a cumulative effect,” Fox says. “Already, there is evidence we’re having some impact. If we do that, to heck with all this other stuff—I can walk away pretty happy at the end of the day.”
