If you made $204,784 a year, should taxpayers subsidize your four-bedroom Los Angeles apartment so you only had to come up with $1,000 in rent money per month? What about having $1.6 million in assets such as stocks, real estate, and retirement accounts, but only paying $300 a month for your one-bedroom, taxpayer-subsidized apartment in Nebraska?
Sounds insane, but the Inspector General (IG) for the Department of Housing and Urban Development (HUD) audited the agency’s public assistance program and found these egregious cases as well as more than 25,000 other Americans abusing the federal assistance program. Perhaps most maddening is that HUD is doing nothing to stop it.
According to the report, public housing authorizes provide public housing aid to as many as 25,226 families whose income exceed HUD’s eligibility requirements. Of those, 17,761 families had exceeded eligibility requirements for more than a year. It’s estimated that HUD will pay $104.4 million over the next year for housing assistance to those who don’t need it.
The problem is that HUD only requires families to meet eligibility requirements when they are admitted to public housing, but they don’t have to keep proving that they actually need it. Furthermore, there is no time limit for how long families can stay in public housing. About 70 percent are repeat offenders. HUD also never requires families, who they know they no longer qualify, to get off the program.
The biggest travesty are all of the families who actually do need assistance sitting on waiting lists while these others waste resources and abuse this social safety net program.
HUD’s response? It’s no big deal!
The Washington Post reports:
About 1.1 million families in the country live in public housing. The over-income tenants represent 2.6 percent of the system. Based on these numbers, HUD officials said the inspector general was “overemphasizing” the problem. But the watchdog didn’t buy it.
“Although 25,226 over income families is a small percentage of the approximate 1.1 million families receiving public housing assistance, we did not find that HUD and public housing authorities had taken or planned to take sufficient steps to reduce at least the egregious examples of over income families in public housing,” the audit said. “Therefore, it is reasonable to expect the number of over income families participating in the program to increase over time.”
But under HUD regulations, public housing tenants can stay as long as they want, no matter how much money they make, as long as they are good tenants. The agency is only required to consider a tenant’s income when an individual or family applies for housing, not once they’re in the system. This is different from the housing choice voucher program that used to be called Section 8, which gives families subsidies for rentals in private apartment buildings. That program has an annual income limit; tenants who go above it get less money.
HUD officials repeatedly objected to the audit, saying that evicting over-income families could “negatively affect their employment and destabilize properties.”
“There are positive social benefits from having families with varying income levels residing in the same property,” Milan Ozdinec, HUD’s deputy assistant secretary for public housing and voucher programs, wrote in a lengthy rebuttal to the inspector general.
The recommendations the IG make are mindlessly agreeable and set what should already be baseline expectations:
IA. Direct housing authorities to establish policies to reduce the number of overincome families in public housing, thereby putting as much as an estimated $104,417,212 to better use by providing those funds to eligible low-income families in need of housing assistance.
1B. Reemphasize to all public housing authorities the need to populate the family self-sufficiency indicator in the Public and Indian Housing Information Center (PIC) system.
You would think that a $49 billion federal agency would at least make it a priority to serve only those who need help and not dole out public assistance like candy drops to those who don’t need it.
For hard-working taxpayers, it’s maddening to see that our hard-earned dollars are being wasted on those who don’t need it, but game the system. It’s depressing to know that there are truly those in need of housing who are experiencing hardships while they wait for a chance at help.
Big federal agencies are so focused on process and unresponsive to new realities that they miss it when people are taking advantage of the system.
This situation is just another example of why reducing the size of government, eliminating red tape and mindless regulations, and returning more power to private charities and organizations are probably better solutions in many cases than addressing our social problems than the enormous bureaucracy.