This week, the Department of Housing and Urban Development (HUD) announced adjustments in funding for low-income housing subsidies that will reduce federal funding for Section 8 vouchers in Oakland.
The vouchers, named after Section 8 of the Housing Act of 1937, are intended to subsidize the cost of fair market rent for low-income households. HUD’s funding adjustments will reduce the monthly subsidy for two-bedroom units in the so-called “Oakland-Fremont Metropolitan Statistical Area,” which includes Alameda County and Contra Costa County, from $1,585 to $1,562.
In a request for HUD to reevaluate the subsidy reduction, the Housing Authority of the County of Alameda (HACA) said the federal agency calculated the adjustments using two-year-old data that does not account for rapidly rising rents across the East Bay. Using the old data, HUD calculated that the rent for a two-bedroom apartment in Alameda County has decreased by 1.45 percent for fiscal year 2016. But county officials said up-to-date data shows the average rent in Alameda County actually increased by 14.1 percent from 2014 to 2015. They report that the average monthly rent for a two-bedroom apartment in Alameda County is really $2,172.
“Oakland is grappling with growing income inequality that threatens the precious social and economic diversity of our city,” Oakland City Council President Lynette Gibson McElhaney (District 3) wrote Wednesday in a letter to HUD Secretary Julián Castro. “If the proposed [fair market] rates are enacted, we expect to see displacement of our families accelerate.”
Though Oakland is within Alameda County, the Oakland Housing Authority (OHA) is directly responsible for distributing Section 8 vouchers within Oakland. OHA and HACA, along with other city-level housing authorities, are working together to protest the funding cuts. McElhaney and Councilmember Desley Brooks (District 6) introduced a resolution for the October 20 Oakland City Council meeting agenda to formally oppose the reduction of Section 8 subsidies. Although the city does not control that funding, the resolution would apply political pressure to the federal housing agency, which allocates the funding to local housing authorities.
Casey Farmer, McElhaney’s policy director, said simply maintaining the 2015 subsidy is not an adequate solution, because it is still far below the actual cost of rent. The purpose of the Section 8 voucher program is for low-income individuals and families to be able to find housing in the private sector and compete with other renters. If the cost of renting continues to exceed the funding for vouchers, low-income individuals will no longer be able to utilize Section 8 vouchers to find housing.
In addition to the reductions in funding for Section 8 vouchers, HACA and OHA are confronting a demand for affordable housing that far exceeds the supply. In August, HACA opened the Section 8 voucher waitlist for one week and received 42,000 applications. This month, HACA will randomly select only 5,000 of these applicants to be added to the waitlist, according to PublicHousingWaitlist.com, a site that aggregates announcements about government-subsidized housing programs.
In her letter to Secretary Castro, McElhaney said 609 Oakland families have received new Section 8 vouchers this year, but only 19 percent of those families have secured housing. In total, 13,000 Oakland families rely on Section 8 vouchers to pay for their housing, according to data cited in McElhaney and Brooks’ resolution.
“The Department of Housing and Urban Development should consider our region’s dramatic rise in rent costs when calculating the Fair Market Rates,” U.S. Congressional Representative Barbara Lee, whose district includes Alameda County, said in a written statement to Oakland North. “Many longtime residents, especially people of color, are being pushed out of their homes and neighborhoods. That is unacceptable.”
Though HACA has formerly asked for a review of the data used to calculate the funding reductions, Ron Dion, the organization’s deputy director for programs, said it’s likely the authority will have to prove to HUD that its data is inaccurate. This would require the housing authorities in the East Bay to collectively fund their own research to show rising rents and present the data to HUD for review. A response from HUD to HACA’s request for review of the rental rate data has not yet been received.
The Oakland City Council will discuss the Section 8 funding reduction and vote on McElhaney’s resolution at its October 20 meeting.