Minimum IncomeRent ReformVancouver Housing AuthorityMoving to Work Demonstration

2014 MTW ConferenceFebruary 5, 2014

Planning for Rent Reform•VHA formed a planning group in 2011•We spent about six months looking at

internal data and what everyone else was doing before our plan began to form

•We knew we wanted something that would save housing costs as well as motivate households toward self-sufficiency

Planning for Rent Reform•Concerns we had to address included:

▫Local economy and lack of jobs▫Local high cost of housing▫Strong advocacy and tenant groups

•The data showed a couple of interesting facts about our subsidized households that led us toward a minimum rent

Households in the VHA HCV Program

El-derly

28%

Disabled39%

Other

33%

2453 HUD Housing Types

Work-Able

45%

Not Work-Able

55%

Work-Able Distribution

Work-Able Household Type•A Work-Able Household is one that

contains one or more Work-Able members•Work-able is defined as an adult under the

age of 62 who is not disabled, a dependent, or a full-time caretaker for a disabled household member

Comparison of Housing Assistance and Tenant Rent by Work-Able Household Type

Not Work-Able

Work-Able & Working

Work-Able & Not Working

$0 $100 $200 $300 $400 $500 $600 $700 $800

Average Tent Rent Average HAP

Comparison of Housing Assistance and Tenant Rent – 4 Person Households Only

Not Work-Able

Work-Able & Working

Work-Able & Not Working

$0 $100 $200 $300 $400 $500 $600 $700 $800 $900

Average Tent Rent Average HAP

Minimum Income Rent Reform•The minimum income is $9000 annually for

each Work-Able household member▫A household with two work-able members has a

minimum income of $18,000, three = $27,000 ▫A Work-Able household’s assistance calculation

is based on the greater of their minimum or their actual gross annual income

▫$9000 is a little less than one would earn working 20 hours per week at WA State minimum wage

Examples of how a Minimum Income would affect Participants1. A two bedroom household with one adult,

two children, and TANF of $478 per month:▫ Annual income is $5736 . Dependent

deduction is $960. Current TTP is $119. Utility Allowance is $90. Tenant rent is $29.

▫ New minimum Income is $9000. Dependent deduction is $960. New TTP is $201. Utility Allowance is $90. Tenant rent is $111.

Examples:

2. A two bedroom household with two work-able adults, two children, and earned income of $1000 per month:

▫ Annual income is $12000 . Dependent deduction is $960. Current TTP is $276. Utility Allowance is $90. Tenant rent is $186.

▫ New minimum income is $18,000. Dependent deduction is $960. New TTP is $426. Utility Allowance is $90. Tenant rent is $336.

Examples:

3. A two bedroom household with two work-able adults, two children, and earned income of $1567 per month:

▫ Annual income is $18,803 . Dependent deduction is $960. Current TTP is $446. Utility Allowance is $90. Tenant rent is $356.

▫ Minimum income is $18,000. Actual income is above minimum – no change in tenant rent.

Examples:

4. A three bedroom household with three adults, one is over age 62 and on Social Security of $900 per month, other two are work-able and report zero income:

▫ Annual income is $10,800. Elderly deduction is $700. Current TTP is $252. Utility Allowance is $106. Tenant rent is $146.

▫ New minimum income is $18,000. Elderly deduction is $700. New TTP is $432. Utility Allowance is $106. Tenant rent is $326.

Impact Analysis

No Change in Rent

Rent Increase from $1 to $100

Rent Increase from $101 to $200

Rent Increase Greater than $200

0 100 200 300 400 500 600

Projected Rent Increase for Work-Able Households

Impact AnalysisHCV Workable Households

  *Impacted Not Impacted  Number Percent Number PercentHOH is Elderly 12 2.37% 36 6.75%HOH is under age 62 and Disabled 55 10.87% 90 16.89%HOH is female 419 82.81% 430 80.68%HOH is only adult in household 293 57.91% 303 56.85%Households with children 403 79.64% 448 84.05%HOH is White 389 76.88% 394 73.92%HOH is Black 83 16.40% 96 18.01%HOH is American Indian/Alaska Native 8 1.58% 5 0.94%HOH is Asian 7 1.38% 22 4.13%HOH is Native Hawaiin/Pacific Islander 19 3.75% 16 3.00%HOH is Hispanic or Latino 39 7.71% 33 6.19%

Hardship Policy•Two different types of exemption for

hardship are offered▫First, every work-able household receives

six months of exemption from the minimum income to use when they choose

▫Second, any impacted household can request an additional exemption Requests are approved by a panel made up of

two VHA representatives and one program participant

Implementation•New MTW Activity under VHA FY 2013

Plan▫Many meetings, presentations and notices

in addition to usual Annual Plan process•In January 2013 the first of multiple

notices went out to impacted households• New web pages, phone lines, computer

changes•13 different classes on job readiness

offered •Over 500 interims raising rent based on

minimum income effective June 1, 2013

Use of the Tenant Choice Hardship

Jun-13

Jul-13 Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Households Utilizing Six-Month ExemptionHouseholds Paying Rent Based on Minimum Income

• Households using six-month hardship is far less than anticipated

• On average only about 25% of those households facing a rent increase used their exemption

• During the first 7 months we have had an average of 137 using their exemption and 334 paying an average increase in rent of $120 per month.

Use of the VHA Approved Hardship

Hardship Panel Determi-nations

No HardshipShort-Term HardshipLong-Term Hardship

• 59 Requests as of 12/31/2013▫ 45 were determined to not

have a hardship▫ 10 had a short-term hardship▫ 4 had a long-term hardship

• 32 of the requests were made prior to implementation

• Another 12 made long before six-month exemption exhausted

• 5 households have made multiple requests

• Represents about 11% of the total households impacted

Performance Metrics and Outcomes   

Dec-2012  Dec-2013 Dec-2014

  Baseline Benchmark Outcome Benchmar

kAverage HAP Payment for Work-Able Households $665 $650 $617 $600Percentage of Work-Able Households with Earned Income 50.69% 51.00% 51.09% 53.00%

Average Earned Income in Work-Able Households $15,653 $15,653 $17,289 $16,000

Imputed Cost Savings $0 $100,000 $308,231 $500,000Number of Evictions/Terminations for Unpaid Tenant Rent 13 18 9 18

Leasing Success Rate of New Voucher Admissions 91.00% 91.00% 99.07% 91.00%Days Required for New Voucher Admissions to Lease 47  47 37 47 

Estimated Monthly Cost Savings

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

Annu

al I

mpu

ted

Min

imum

Inc

ome

Cos

t Sa

ving

s

Conclusion•Use of hardship exemptions is far less

than anticipated•Cost savings as a result of the minimum

income are above projections•Employment among participants is rising•There appears to be few, if any, serious

negative outcomes