HUD Allowing Wealthy Families To Live In Public Housing While Poor Families Linger On Waiting Lists

Kristina Ribali Senior Coalitions Director, Foundation for Government Accountability
Font Size:

Welfare benefits like food stamps and public housing are supposed to be a “safety net” to protect our poorest and most vulnerable citizens. But does a family with a half million dollars in income really need a government-provided safety net?

According to a report by the Washington Post, an audit of the public housing assistance provided by the Department of Housing and Urban Development (HUD) found more than 25,000 “over income” families who earned more than the maximum income for public housing but were still allowed to remain.

Among the examples cited by WaPo:

  • New York City, New York: a family of four with an annual income of $497,911 (including nearly $800,000 of income from other rental properties they own over the past few years) who paid $1,574 a month for a three-bedroom apartment;
  • Los Angeles, California: a family of five with an annual income of $204,784 who paid $1,091 a month for a four-bedroom apartment; and
  • Oxford, Nebraska: a tenant with $1.6 million in assets who paid $300 a month for a one-bedroom apartment.

In many cases, the abuses had gone on for years. According to the audit, about 1,200 of the 25,226 public housing tenants over the income threshold had exceeded those income limits for nine years or more, and almost 18,000 had been over the limits for more than a year. The Los Angeles family mentioned above has lived in public housing since 1974

Screen Shot 2015-08-20 at 10.05.36 AM

What is even more outrageous is that these wealthy tenants are occupying public housing while hundreds of thousands of families who do meet the income requirements languish on waiting lists. Taxpayers will pay an estimated $104 million to subsidize housing for people who could afford to pay for it themselves, while poor families wait for years.

HUD, the agency charged with administering the public housing program, seems unconcerned with these abuses or the detrimental effect on families who actually qualify for assistance. HUD’s regulations and policies do not require them to evict over-income families or order them to seek unsubsidized housing elsewhere. As long as the tenants remain “good” tenants, they are allowed to remain.

The rationale for this policy is absurd: HUD housing authorities told the auditors that they did not want poverty to be “concentrated” in government-subsidized housing, citing a goals of creating “diverse, mixed-income communities” and “allow[ing] tenants who are making good money to serve as role models for others.”

“There are positive social benefits from having families with varying income levels residing in the same property,” wrote Milan Ozdinec, HUD’s deputy assistant secretary for public housing and voucher programs, in a rebuttal to the audit report.

Ozdinec also cited concerns about jeopardizing tenants’ employment by forcing them to move if they could not find suitable housing in the area, and disrupting school-age children if a family was forced to move during the school year.

It’s hard to believe that a family making hundreds of thousands of dollars a year truly has trouble finding housing, even in tough housing markets. Furthermore, a simple rule saying over-income families with school-age children would be allowed to stay until the end of the semester or school year would address that problem. Simply having a child in school does not justify allowing a wealthy family to receive subsidized housing for years –decades, in some cases – while other families linger on the waiting lists.