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Minimum Income Rent Reform

Minimum Income Rent Reform. Vancouver Housing Authority Moving to Work Demonstration 2014 MTW Conference February 5, 2014. Planning for Rent Reform. VHA formed a planning group in 2011

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Minimum Income Rent Reform

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  1. Minimum IncomeRent Reform Vancouver Housing Authority Moving to Work Demonstration 2014 MTW Conference February 5, 2014

  2. Planning for Rent Reform • VHA formed a planning group in 2011 • We spent about six months looking at internal data and what everyone else was doing before our plan began to form • We knew we wanted something that would save housing costs as well as motivate households toward self-sufficiency

  3. Planning for Rent Reform • Concerns we had to address included: • Local economy and lack of jobs • Local high cost of housing • Strong advocacy and tenant groups • The data showed a couple of interesting facts about our subsidized households that led us toward a minimum rent

  4. Households in the VHA HCV Program

  5. Work-Able Household Type • A Work-Able Household is one that contains one or more Work-Able members • Work-able is defined as an adult under the age of 62 who is not disabled, a dependent, or a full-time caretaker for a disabled household member

  6. Comparison of Housing Assistance and Tenant Rent by Work-Able Household Type

  7. Comparison of Housing Assistance and Tenant Rent – 4 Person Households Only

  8. Minimum Income Rent Reform • The minimum income is $9000 annually for each Work-Able household member • A household with two work-able members has a minimum income of $18,000, three = $27,000 • A Work-Able household’s assistance calculation is based on the greater of their minimum or their actual gross annual income • $9000 is a little less than one would earn working 20 hours per week at WA State minimum wage

  9. Examples of how a Minimum Income would affect Participants • A two bedroom household with one adult, two children, and TANF of $478 per month: • Annual income is $5736 . Dependent deduction is $960. Current TTP is $119. Utility Allowance is $90. Tenant rent is $29. • New minimum Income is $9000. Dependent deduction is $960. New TTP is $201. Utility Allowance is $90. Tenant rent is $111.

  10. Examples: • A two bedroom household with two work-able adults, two children, and earned income of $1000 per month: • Annual income is $12000 . Dependent deduction is $960. Current TTP is $276. Utility Allowance is $90. Tenant rent is $186. • New minimum income is $18,000. Dependent deduction is $960. New TTP is $426. Utility Allowance is $90. Tenant rent is $336.

  11. Examples: • A two bedroom household with two work-able adults, two children, and earned income of $1567 per month: • Annual income is $18,803 . Dependent deduction is $960. Current TTP is $446. Utility Allowance is $90. Tenant rent is $356. • Minimum income is $18,000. Actual income is above minimum – no change in tenant rent.

  12. Examples: • A three bedroom household with three adults, one is over age 62 and on Social Security of $900 per month, other two are work-able and report zero income: • Annual income is $10,800. Elderly deduction is $700. Current TTP is $252. Utility Allowance is $106. Tenant rent is $146. • New minimum income is $18,000. Elderly deduction is $700. New TTP is $432. Utility Allowance is $106. Tenant rent is $326.

  13. Impact Analysis

  14. Impact Analysis

  15. Hardship Policy • Two different types of exemption for hardship are offered • First, every work-able household receives six months of exemption from the minimum income to use when they choose • Second, any impacted household can request an additional exemption • Requests are approved by a panel made up of two VHA representatives and one program participant

  16. Implementation • New MTW Activity under VHA FY 2013 Plan • Many meetings, presentations and notices in addition to usual Annual Plan process • In January 2013 the first of multiple notices went out to impacted households • New web pages, phone lines, computer changes • 13 different classes on job readiness offered • Over 500 interims raising rent based on minimum income effective June 1, 2013

  17. Use of the Tenant Choice Hardship • Households using six-month hardship is far less than anticipated • On average only about 25% of those households facing a rent increase used their exemption • During the first 7 months we have had an average of 137 using their exemption and 334 paying an average increase in rent of $120 per month.

  18. Use of the VHA Approved Hardship • 59 Requests as of 12/31/2013 • 45 were determined to not have a hardship • 10 had a short-term hardship • 4 had a long-term hardship • 32 of the requests were made prior to implementation • Another 12 made long before six-month exemption exhausted • 5 households have made multiple requests • Represents about 11% of the total households impacted

  19. Performance Metrics and Outcomes

  20. Estimated Monthly Cost Savings

  21. Conclusion • Use of hardship exemptions is far less than anticipated • Cost savings as a result of the minimum income are above projections • Employment among participants is rising • There appears to be few, if any, serious negative outcomes

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