Housing assistance reform legislation, H.R. 3700, the “Housing Opportunity Through Modernization Act,” is expected to be considered by the full House of Representatives floor during the week of February 1. Representatives will likely offer amendments to the bill during floor consideration, which could begin as soon as February 2. NLIHC supports the bill.
As with any housing bill being considered on the floor of the House or Senate, any type of amendment may be offered and ruled in order for consideration. The House Committee on the Rules is scheduled to set the rules for H.R. 3700 on February 1. At that point, advocates will have a clear sense of what amendments will be offered during floor consideration. NLIHC will issue a “Call to Action” advising advocates about amendments that should be supported or opposed.
Advocates should contact their Representative’s office to urge them to support H.R. 3700 and any amendments that improve the bill. Any amendments that would impose time limits on housing assistance, add work requirements for residents, increase residents’ rents, or otherwise decrease their ability to rely on stable and decent housing should be opposed.
The bill was introduced on October 7 by Housing and Insurance Subcommittee Chair Blaine Luetkemeyer (R-MO) and voted out of the House Committee on Financial Services on December 10 by a vote of 44 to 10. Ten Democrats led by Ranking Member Maxine Waters (D-CA) opposed the bill because of concerns about changes to how child care expenses are deducted from resident income before rents are calculated.
Current law allows public and assisted housing residents to deduct certain child care expenses from their incomes before their rents are calculated. H.R. 3700 would limit such expenses to those exceeding 5% of a tenant’s income. The bill would also increase the standard annual income deduction for dependents from the current $480 to $525 and index the value of this deduction to inflation.
In response to Ms. Waters’ concerns about the income deduction changes, Mr. Luetkemeyer offered an amendment during the mark-up of H.R. 3700 that inserts a hardship exemption for households negatively impacted by the deduction changes. The amendment required the HUD Secretary to develop hardship polices for households that demonstrate they are unable to pay their rent due the changes in deductions. The original bill had allowed, but did not require, the HUD Secretary to develop such hardship policies. The amendment was adopted.
H.R. 3700 would change how resident incomes are calculated and their rents are determined in the public housing, housing choice voucher, and project-based rental assistance programs. Current law allows heads of households who are elderly or who have a disability to deduct medical expenses and certain disability assistance expenses above 3% of their income from their total income for purposes of determining rent. H.R. 3700 would increase the threshold over which such households can deduct medical and care expenses from 3% to 10%. Also, currently each household with a head of household who is elderly or has a disability receives a standard annual income deduction of $400. H.R. 3700 would increase the standard deduction for such households from $400 to $525 and index the value of the standard deduction to inflation.
H.R. 3700 would also require that resident rents be based on prior year income, except when setting initial rents. Residents whose incomes increase in a given year would not have their rents adjusted until the next annual recertification. The bill would also limit the frequency of interim income reviews. PHAs would be required to recertify incomes and adjust rents when a household’s annual income decreases by 10% or more. The same 10% threshold would apply for families whose incomes increase, except the bill excludes interim income reviews when the increase is from earnings.
The bill would also make a variety of improvements to the project-basing of housing choice vouchers. Currently public housing agencies can project-base up to 20% of their voucher budget authority. H.R. 3700 would give agencies the flexibility to increase project-basing another 10% to serve households in areas where vouchers are difficult to use or to assist persons with disabilities, elderly people, people who were formerly homeless, and veterans. The bill would also allow PHAs to commit project-based vouchers for 20 years, up from the current 15, and give more flexibility to the number of units in any property that can be designated for project-based vouchers.
H.R. 3700 would change inspection protocols for apartments to be rented by voucher holders. Potential apartments could be occupied by voucher holders if the units have been inspected by the PHA, as is current law, but also allow occupancy of units that have been inspected in the previous 24 months under a federal inspection standard that is at least as stringent as the voucher program’s Housing Quality Standards. The bill would also allow voucher rent payments and occupancy to begin if the unit does not pass the initial inspection due to non-life threatening conditions. The deficiencies from the failed inspection must be corrected within 30 days of initial occupancy for the landlord to continue receiving payments from the PHA.
The bill also would impose limits on public housing assistance for households with incomes above 120% of area median income. When a household’s income is above 120% of area median income for two consecutive years, the PHA would be required to either terminate the household’s assistance within six months or charge the household rent equal to the higher of the fair market rent or the costs of operating and capital subsidies provided for that unit.