A Primer on Housing Programs

After reading two recent articles on streets.mn about housing issues, along with recent articles in MinnPost, and articles on Citylab about the cost of public housing, it seemed that a primer on housing programs might be helpful. While the capable readers and writers from streets.mn would not confuse public housing with Section 8 or other programs, I have seen the terms used interchangeably on other sites. Let’s get them straight!

This is not an exhaustive list. The Minnesota Department of Human Services identifies 30 different housing programs within its own agency, most of which are very small programs serving a select group of people such as those exiting a specific facility. These are the largest ones or the most mainstream that serve a broad group of people. Each program could probably have its own article and reams of policy are associated with each. This is a primer, but I have provided links for each if you would like to find out all the minutiae.

Section 42

What is it? Section 42 is a section of the Tax Credit Reform Act of 1986 which created the Low Income Housing Tax Credit Program. It refers to the section of the law under the Internal Revenue Code. It provides tax credits to housing developers for keeping units affordable for a specific time period. To receive the tax credit developers must reserve no less than 20 percent of units for tenants with incomes 50 percent or less of the Metropolitan Statistical Area (MSA) median household income or no less than 40 percent of units for tenants with incomes of less than 60 percent of the MSA median household income. There are a bunch of other Section numbers that operate similarly, but for specific populations such as elderly tenants, rural areas, or tenants with disabilities. Rent cannot exceed 30 percent of a tenant’s income.

Who qualifies? It depends on the tax credit the developer applied for, but generally people with incomes less than 60 percent of an MSA’s median household income.

Who funds it? This is a federal tax credit.

What else? This is invisible, meaning that no one, including your neighbors has to know you have a lease in that building because it is Section 42 funded. This can increase mixed income housing, which is typically a goal of governments and housing advocates. On the other hand, it is not well understood and it can be difficult to know which buildings have these units. Also, it is unit-based, meaning if the tenant moves they lose the subsidy.

Public Housing

What is it? Public housing are government-owned buildings where all tenants have to be below either 30, 50, or 80 percent of the MSA median household income, depending on the project. Think about Horn Towers or Mount Airy.

Who qualifies? People with income below 30, 50, or 80 percent of the MSA median household income. There are buildings for specific populations such as the elderly, people with disabilities, American Indians (Little Earth Housing in Minneapolis is an example), or others.

Who funds it? Federal government under the U.S. Department of Housing and Urban Development.

What else? These types of buildings have fallen out of favor and scattered site housing has become more popular based upon concerns of the effects of concentrated poverty. Also, this is very visible and can be stigmatizing for residents. There are typically long waiting lists and restrictions that exclude potential tenants with criminal records. The subsidy is attached to the unit so if someone needs to move they lose the subsidy.

Section 8 Voucher

What is it? Section 8 Vouchers are vouchers that allow tenants to find private market rentals and the local Housing Authority makes up the different between that household’s income and the market rate rent. Tenants pay between 30 and 40 percent of their income toward rent. There are restrictions on the maximum subsidy which can limit the availability of units.

Who qualifies? Same as public housing. There are special vouchers for special populations such as homeless families, people with disabilities, and the elderly.

Who funds it? Federal government under the U.S. Department of Housing and Urban Development.

What else? It can be difficult to find landlords willing to accept the vouchers. Not only because some landlords think Section 8 is a flag for a trouble tenant, but also because the program requirements can be seen as cumbersome by landlords. The subsidy is attached to the person so if they need to move and can find another landlord to accept their voucher, households can move. Currently, 16 of the Twin Cities housing authorities have closed waiting lists and six have open waiting lists, some for only specific groups. The waiting list can be a decade long.

Permanent or Transitional Supportive Housing

What is it? Permanent or Transitional Supportive Housing are units or buildings funded with Minnesota Housing Capital Funds or Operating Subsidies that provide housing with supportive services. Supportive services vary by the contract but can include case management, parenting support, transportation, medication monitoring, financial planning and budgeting, support groups, or social activities. There is a lot of variation in what these buildings look like and what they offer. Some are entire buildings, some are single units within a building, and others are more like facilities and offer congregate living. Transitional programs are for 24 months or less. Permanent are permanent.

Who qualifies? Households experiencing long-term homelessness, which is lacking a permanent place to live continuously for one year or more or at least four episodes of homelessness in the last three years.

Who funds it? The state through the Minnesota Housing Finance Agency.

What else? Supportive housing is a big component of Minnesota’s Plan to Prevent and End Homelessness. The state has invested $71 million in these programs in the last two years. These programs serve people who cannot maintain housing without support. More of these programs take a Housing First approach. Housing First is the idea that without housing people cannot make progress in other areas of their life. In the past, people were required to meet certain guidelines for housing, like maintaining sobriety. Now, Housing First focuses on housing people first and then helping them with the issues that led to homelessness.

Emergency Assistance and Emergency General Assistance

What is it? Emergency Assistance (EA) and Emergency General Assistance (EGA) is a cash grant that can be used once in a 12-month period to help with emergency basic needs like an eviction, damage deposit, or utility shut-off. EA can fund a rent subsidy of 75 percent for up to four months. Statewide more than 80 percent of EA and EGA money is spent on housing-related issues.

Who qualifies? EA is for families with children or pregnant women who meet the eligibility criteria for the Minnesota Family Investment Program (MFIP). EGA is for singles and married couples without children who are not on MFIP and have incomes less than 200 percent of the Federal Poverty Guideline (FPG).

Who funds it? The state through the Minnesota Department of Human Services and, for EGA, the county human service departments.

What else? Each county defines what an emergency is. Typically, the grant must be able to resolve the emergency. For example, if someone is being evicted from an apartment with rent of $800 and their income is $600 a month, EA or EGA will be denied because the apartment is not affordable. EGA is dependent on availability of funds. Each county receives a set amount from the state and when the money is gone, no more grants are made. There is a lot of variability in EGA from county to county, from eligibility, definition of an emergency, and maximum grant amounts.

Group Residential Housing

What is it? Group Residential Housing is room and board for seniors and adults with disabilities in a licensed or registered setting which can include adult foster homes, board and lodging facilities, or supervised living facilities. Counties and tribal nations contract with sites licensed by the Minnesota Department of Human Services or the Minnesota Department of Health. Residents pay 30 percent of their income and the state pays the difference up to $891 per month, plus additional fees for services (Supplemental Service Rate).

Who qualifies? Adults and seniors with a disability that meets the criteria of the Social Security Administration. They must have income under $1,090 for disabled adults or $1,820 for blind adults and meet at asset limit of $2,000 for single people or $3,000 for a married couple.

Who funds it? The state through the Minnesota Department of Human Services.

Minnesota Supplemental Aid – Housing Assistance

What is it? Minnesota Supplemental Aid (MSA) is a $200 per month income supplement for people receiving or eligible for Supplemental Security Disability Income who pay more than 40 percent of their income toward housing.

Who qualifies? People receiving or eligible for Supplemental Security Disability Income, under age 65, who are either exiting certain institutions, eligible for a Medical Assistance waiver for community-based services, or be eligible for Personal Care Attendant services through Medical Assistance.

Who funds it? The state through the Minnesota Department of Human Services.

What else? This is a very under-utilized program. About 30,000 people in Minnesota receive MSA, but less than 1,000 people use the Housing Assistance grant. Many more qualify.

Homeless Shelters

What is it? Homeless shelters are buildings where homeless families or individuals can receive temporary shelter. Shelters are a mixed bag. Some offer shelter for up to 90 days while others have lotteries for a single night. Some offer an efficiency apartment others just a mat on the floor. Some are for families, others for single men or single women. Rural areas without shelters will often voucher homeless families into a motel. Some offer lots of other supportive services and others just a warm place for the night.

Who qualifies? Homeless people, however individual shelters serve specific populations like women with children or single men.

Who funds it? Shelters have a mishmash of funding. The U.S. Department of Housing and Urban Development, the state, counties, philanthropic organizations, and others provide funding.

What else? Accessing homeless shelters depends on the county. In Ramsey and Hennepin Counties families can call United Way’s 211 for shelter intake. The waiting list is longer than a month for family shelter. If a family receives a call for a shelter opening they must call back within two hours or they lose their spot. Singles in Ramsey County can contact the Dorothy Day Center and in Hennepin County contact St. Stephen’s.

There you go! Now you know the tip of the iceberg when it comes to housing programs and will never confuse public housing with Section 8 ever again.