Politics

Feds Pay Low-Income Families $1800 A Month To Leave Poor Areas, Penalize Them If They Don’t

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Rachel Stoltzfoos Staff Reporter
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In a bid to get low-income Dallas families into more expensive neighborhoods, the federal government has cut subsidies for those who choose to stay in cheaper neighborhoods, and is offering those who move housing vouchers worth up to $1,800 a month.

The Housing and Urban Development program began in 2011 as part of a settlement with housing activists and is inspired by the work of Harvard economist Raj Chetty who has found that where children grow up impacts their adult life, reported The New York Times. The idea is to prod low-income families into safer, more affluent neighborhoods with better schools.

The vouchers were created in the 1970s to give low-income families a chance to get out of their neighborhoods, but that effort has largely failed, and they remain for the most part clustered together in low-income neighborhoods. (RELATED: SCOTUS Okays Lawsuits For Accidental Housing Discrimination)

“When you give somebody a voucher, it tends to be the case that they buy better-quality housing in the same neighborhood,” Harvard economist Peter Ganong told TheNYT. “That’s always been a disappointing fact within HUD.”

“If they’re not finding better neighborhoods, why are we putting this money into housing?” he added.

Officials concluded the subsidies they were offering previously were too small, so in the Dallas experiment and in some other added regions, they upped the value of the vouchers. In the cheapest zip codes, HUD cut housing subsidies to a maximum of $850 a month, but in the most expensive zip codes they increased them to a current maximum of $1,840.

Dallas Housing Authority chief MaryAnn Russ lauded the experiment, but admitted to some unintended consequences. Officials had predicted that cutting subsidies in the low-income neighborhoods would force landlords to lower the rent.

But most landlords did not lower their price, forcing many low-income families to pay more of the rent out of pocket. Others are unable to move to more expensive neighborhoods because they are so poor they can’t afford a security deposit. Some landlords in more expensive neighborhoods refuse to accept housing vouchers.

The Obama administration unveiled new rules Wednesday to rid the country of racially segregated neighborhoods by directing cities and towns to set goals for reducing segregation, and then regularly report their progress to the feds.

The Department of Housing and Urban Development rule is intended to incentivize communities to meet fair housing standards established in the Fair Housing Act of 1986, by making previously unavailable or unreliable data accessible to the public, which could then use the data as an impetus for change.

Two women who did manage to move their families into more expensive neighborhoods told TheNYT it was a great decision. Torey Moore doesn’t live as close to her family, but she doesn’t need their help as often because she lives closer to her job.

Lamesa White is struggling to rebuild her social network after she cut off all her old friends by changing her cellphone number. So far she’s connected only with another subsidized family. But she’s happy the neighborhood is relatively safe.

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