Breaking Down Income Discrimination in the Housing Voucher Program

Summary: The Section 8 Housing Voucher Program provides rental assistance to low-income families, but landlords routinely refuse to rent to voucher holders. Housing instability hurts financial security and worsens health outcomes, and states are moving to implement protections against discrimination on the basis of source of income.

How Housing Vouchers Work 

The Section 8 Housing Voucher Program, also known as the Housing Choice Voucher Program, provides rental assistance to low-income Americans. In 2018, the program provided more than 2.2 million households and 5 million people with rental assistance. 

Vouchers help make housing affordable for low-income individuals. Holders pay 30 percent of their monthly adjusted gross income income toward rent and utilities, while the government pays the remaining cost. If the tenants do not have any income, they pay up to a maximum amount of $50 per month.

To determine eligibility for the Housing Choice Voucher Program, the Department of Housing and Urban Development (HUD) sets income limits. Income limits vary by location and are based on calculations of the median income and fair market rent in the area in which the given family chooses to live. When allocating vouchers, 75 percent of recipients must be “extremely low-income,” meaning their earnings are lower than 30 percent of the area’s median income or the federal poverty line, whichever is higher. When someone receives a housing choice voucher, they have limited time to find an apartment to rent. Though extensions are occasionally possible, the standard period is usually between 60 and 120 days

The Positive Impact of Rental Assistance

Housing insecurity increases public health care costs while lowering productivity and increasing reliance on social support programs. Prior research demonstrates that substandard housing conditions are associated with higher rates of chronic illnesses, infectious diseases, injuries, and poor mental health and nutrition. Additionally, millions more low-income households are becoming severely burdened by the cost of renting. About 10.9 million renters spent over half of their income on housing in 2018.

Research shows that housing vouchers help millions of America’s most vulnerable. Vouchers help to prevent homelessness and increase long-term health and economic outcomes of children in low-income families. In fact, a HUD-funded study called the “Moving to Opportunity” project, found significant benefits to families after using vouchers to move to lower-poverty neighborhoods. In addition to better health outcomes and higher projected future incomes, children were significantly more likely to attend college. Rental assistance may help break the cycle of disadvantage that results in persisting generational poverty.

Income Discrimination in the Section 8 Program

In reality, landlords routinely discriminate against renters with voucher holders, threatening a social program aimed at aiding the nation’s poorest. According to the HUD, this income discrimination especially occurs in higher-rent areas with higher-quality schools, transportation and jobs. Families in the Section 8 program often encounter landlords who refuse to take their vouchers or find other ways to avoid renting to them, including falsely claiming that they have no available apartments. Even more commonly, prospective tenants wishing to pay with government assistance often receive ambiguity in responses essentially serving as denial without being outright.

In fact, the Urban Institute conducted research by pretending to be voucher holders and calling thousands of landlords in 5 cities with apartments affordable by voucher. In Los Angeles, Philadelphia, and Fort Worth, over two-thirds of landlords said they would refuse to accept Section 8 housing vouchers. 

Source of Income Protections at the State Level

Current protections targeting income discrimination stopping low-income families on financial government assistance from accessing housing are being implemented at the state level. 13 states, the District of Columbia, and over 50 cities and counties across the nation have passed Source of Income laws or ordinances prohibiting landlords from refusing to rent to Section 8 voucher holders. Essentially, landlords are required to treat voucher holders the same as they would any other applicant, regardless of method of payment.

Importantly, these protections seem to work. New research shows reductions in neighborhood poverty rates associated with the implementation of Source of Income laws. Additionally, protections increase voucher use and the Section 8 program’s effectiveness. Though research is mixed on whether Source of Income protections help families reach higher-opportunity neighborhoods, evidence shows that protections result in higher rates of success for those seeking housing. 

The progress being made to implement protections against income discrimination in the voucher program is at the state level, but many areas haven’t passed Source of Income laws. The Poverty and Race Research Action Council estimates that only about half of all voucher holders are protected by Source of Income laws.

Progress on the Federal Stage

At the federal level, several bills protecting against income discrimination in the housing voucher program have been introduced. However, no federal protections have passed. Currently, Americans are protected from basic discrimination when renting or buying a home under the Fair Housing Act, but this legislation does not directly address source of income.

The fundamental legislation still pending is S.3612 – the Fair Housing Improvement Act. This bill was introduced in the Senate on November 13, 2018 by Senator Orrin G. Hatch of Utah, before referral to the Committee on Banking, Housing, and Urban Affairs. Essentially, the bill would provide broad protection against discrimination in housing on the basis of source of income or veteran status. 

Another relevant bill is the American Housing and Economic Mobility Act. The bill was introduced in 2018 in the Senate as S.3503 and in the House as H.R.7262, and would expand protections under the Fair Housing Act in addition to establishing programs to improve housing affordability and access.

Noah Charlick is a sophomore from Canton, Ohio, studying Public Policy and Global Health.

 

 

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