NLIHC is coordinating a sign-on letter opposing the U.S. Department of Agriculture’s (USDA) proposal to impose $50 minimum rents on tenants currently receiving USDA rental assistance. The new minimum rent policy was part of President Barack Obama’s FY15 budget request for Rural Development (RD) (see Memo, 3/7). NLIHC opposes higher minimum rents in the absence of meaningful hardship protections.
Under President Obama’s FY15 budget request, the Administration would institute a minimum rent payment of $50 for residents with Section 521 rental assistance in Section 514 or 515 properties. The sign-on letter urges Congress not to approve the new minimum rent policy.
“Today, these RD rental housing residents pay 30% of their adjusted income for rent, the federal standard for affordability. The mandatory minimum rent proposal would affect the 42,000 households whose incomes are so low that they currently pay less than $50 a month in rent. These households have adjusted annual incomes of less than $2,000. For these households, RD housing assistance is often the last barrier between having a home and being homeless,” reads the letter.
Out of a $1.1 billion FY15 cost for the Section 521 Rental Assistance program, the proposal would generate $5 million, all from households with adjusted annual incomes below $2,000. Households with incomes above the adjusted annual income of less than $2,000 already pay more than $50 a month toward rent, since 30% of their monthly income is greater than $50, and thus would not be affected by the proposal.
In its budget justifications, USDA says the change “will encourage financial responsibility in tenants, increasing their opportunity for success on the path to homeownership.”
“The housing stability provided by USDA rental assistance for rural poor families, 60% of whom are elderly and 48% of whom include a person with a disability, prevents them from becoming homeless. It is nonsense to assert that making them pay more will help them become homeowners,” responded NLIHC President and CEO Sheila Crowley in a March 13 press release.
Other national groups are arguing against the proposed minimum rent policy. On April 11, the Center on Budget and Policy Priorities (CBPP) posted on their blog that “many of those who would be affected are especially vulnerable to hardship: 64 percent of households with USDA rental assistance have a head (or the head’s spouse) who is elderly or has a disability, and 135,000 children live in low-income families receiving such assistance.” A March 13 Shelterforce blog post by the National Housing Law Project (NHLP) explained, “In other words, this change will impact the most destitute tenants who have the least capacity to pay minimum rent. They are vulnerable households who temporarily or permanently do not receive Social Security, Disability, or other assistance and have no regular full time employment. They are simply unable to pay minimum rent.” A March 17 Shelterforce blog post by the Housing Assistance Council echoed the understanding that the proposal “would hit tenants with the lowest incomes.”
National and statewide organizations are urged to sign on the opposition letter by the April 21 deadline.
View the sign on letter at: http://bit.ly/RjReNM
Sign on to the letter at: http://bit.ly/1nqIIGI
View NLIHC’s press release at: http://nlihc.org/press/releases/4124
View the CBPP blog post at: http://bit.ly/1gSd4MI
View the NHLP Shelterforce blog post at: http://bit.ly/1lkz7Qv
View HAC’s Shelterforce blog post at: http://bit.ly/1jiwj3z