Section 8 loophole thwarts evacuees
Other cities want to keep housing voucher Sunday, July 06, 2008By Katy Reckdahl
Two weeks ago in Houston, two Katrina evacuees hauled the final boxes out of their apartments. But even as their landlords prepared to change their locks, Gina Martin and Samantha Egana couldn't go home to New Orleans, because their Section 8 vouchers were stalled by the Houston Housing Authority.
Despite months of trying, neither could transfer the federal rental assistance back to their hometown.
In theory, Section 8 vouchers are "portable" -- transferable to anywhere in the United States. But many evacuees have had transfers denied or delayed because of a HUD loophole allowing local agencies to reject moves to "higher-rent" areas like New Orleans.
Though all vouchers nationwide are financed by the federal government, the U.S. Department of Housing and Urban Development has set up an elaborate reimbursement system requiring local housing authorities to bill each other when recipients want to move.
HUD rules allow the receiving agency -- in this case, the Housing Authority of New Orleans -- to refuse to pay the rental subsidy for people moving in. That leaves the sending agency -- in this case, the Houston Housing Authority -- on the hook to pay for housing people in other cities.
This has caused a standoff between HANO and housing authorities in other cities, particularly in Texas, which took in many Katrina evacuees. The Housing Authority of New Orleans can't afford to pay for any incoming vouchers, said HUD spokeswoman Donna White. So many out-of-town housing agencies -- facing the prospect of paying rent for all transferring vouchers -- have invoked the "higher rent" exception to refuse New Orleans transfers, including Martin's and Egana's.
Congressional budgets have always allocated a specific number of Section 8 vouchers for each community. To routinely shift each voucher's federal money along with each moving Section 8 family would throw a wrench into that system, meant to address each community's needs, White said.
More than 40,000 Section 8 tenants transfer vouchers nationwide each year, White said. But the agency doesn't track how many of those transfers were to "higher-rent" areas, nor whether the sending or receiving agencies pick up the tab.
Laura Tuggle, head of housing law for New Orleans Legal Assistance, called the idea of portable vouchers "a myth."
"This is a huge national issue -- it's not just us," Tuggle said. She has long battled the issue in smaller numbers, but because so many Katrina evacuees are ready to return, her caseload now consistently includes transfer refusals, she said.
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