January 27, 2012
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The House Financial Services Subcommittee on Insurance, Housing, and Community Opportunity recently circulated new draft legislation to reform the Section 8 program, the Affordable Housing and Self-Sufficiency Improvement Act of 2012 (AHSSIA).  The legislation is the latest version of the Section 8 Voucher Reform Act (SEVRA) and the Section 8 Savings Act (SESA).  The Subcommittee expects to markup the legislation, which has not yet been formally introduced and thus has not been assigned a bill number, in mid-February.
 
The legislation would require inspections biennially instead of annually; reduce the frequency of income recertification from annually to every three years for tenants on fixed incomes; and base rent on a tenant’s income from the previous year.  The legislation would increase the minimum rent contribution from between $25 and $50, as determined by HUD, to $69.45, and indexes that amount to inflation annually.  The bill would direct the HUD Secretary to certify no later than 6 months after the bill’s enactment that current hardship provisions covering those unable to meet the minimum rent requirement are being and will continue to be enforced.
 
The legislation would also:
 
  • Change the definition of extremely-low income (ELI) to include families with income at 30 percent or less of the area median income (AMI) or families with incomes below the poverty line, whichever is greater.  Currently, ELI families are those with incomes at 30 percent or less of AMI.
     
  • Increase the annual standard deduction from $400 to $550 for an elderly or disabled family and increase it from $480 to $525 for families with dependents.  It proposes to limit the medical deduction to expenses of more than 10 percent of income instead of more than 3 percent of income as required by current law.
     
  • Allow public housing agencies (PHAs) to exceed by 5 percent the 20 percent limitation on project-based assistance to provide project-based assistance for veterans, homeless populations, and supportive housing for persons with disabilities, and to provide assistance for housing units in areas where tenant-based vouchers are difficult to use.  The legislation bases the project-based limitation on the number of authorized units instead of the tenant-based funding level.  The bill would also increase the initial and extension contract terms for project-based voucher contracts from up to 15 years to up to 20 years.
     
  • Base renewal of voucher funding on vouchers used the prior year, including vouchers above the authorized level if they were funded from the previous year’s new allocations.  Additionally, the bill would permit a reserve level of at least 6 percent of annual renewal funding.
     
  • Establish the Moving to Work (MTW) program as a HUD program and end its status as a demonstration.  It would also create an application and review process for PHAs wanting to apply to become an MTW agency, and would eliminate the current restrictions on the number of PHAs that can participate in MTW.  Current MTW agencies would be allowed to keep their current contracts.
     
  • Expand the Family Self-Sufficiency (FSS) program.  It would make participation by PHAs administering 500 or more units mandatory, subject to appropriations, and would create a funding structure for housing authorities. 
     
  • Extend the Mark to Market program through October 1, 2015.
     
  • Authorize a five-year, $150 million rental assistance conversion demonstration program to “develop, test, and evaluate new approaches to preserve affordable rental housing.” 
     
  • Authorize $50 million for HUD to convert existing Rent Supplement and Rental Assistance Program (RAP) contracts to Section 8 project-based rental assistance contracts over five years.


Please send your comments on the draft bill to Mindy La Branche by February 7.