Public housing authorities across the U.S. must do a lot with a little.
But what’s surprising is many of them don’t fully use all their funding for the Housing Choice Voucher Program, known historically as Section 8, according to a new study by Santa Monica-based policy think tank the RAND Corporation and the Terner Center at the University of California, Berkeley.
Local housing agencies that administer vouchers around the country left more than $1 billion, or about 3 percent of the program’s total budget, on the table in 2023. And on average, voucher and budget usage across some 2,200 public housing agencies in the U.S. declines as housing markets tighten, the researchers found. That poses a growing bottleneck, especially in markets where rents are rising and the vacancy rate is decreasing.
“We’ve been way below our voucher utilization forever just based on the budget constraints,” one study participant told the researchers.
Federal funding for Section 8 vouchers is already spread thin and might face further cuts this year. Most jurisdictions maintain long wait lists, and fewer than 1 in 4 eligible households across the country succeeds in accessing federal assistance, according to a 2023 analysis by the Congressional Research Service.
Perhaps it’s no surprise that housing authorities — and voucher proponents more broadly — have introduced a range of new programs to maximize their reach and adapt to tighter rental markets across the country.
The researchers analyzed the impact of these new programs and found signs of lasting impact.
Here are two of their main findings:
Payment Standards
Payment standards cap the rental rate that vouchers can cover in markets where median rent is increasing rapidly, leaving the voucher-holder on the hook to pay the difference.
That expands the pool of units available to voucher holders and increases their odds of succeeding in leasing an apartment in more expensive markets, the researchers found. But it also tends to eat up the budget faster and result in fewer vouchers overall, according to the study.
Moving to Work
The Moving to Work demonstration program, introduced by the U.S. Department of Housing and Urban Development in the 1990s and expanded in 2020, lets public housing authorities merge public housing and voucher program funding, giving them much more flexibility in how they administer both programs.
The number of housing authorities opting into the program has grown to 139 from 39 in 2020.
Those that haven’t yet opted in — the vast majority — struggle to fully utilize their resources, according to the researchers. Only 28 percent of non-Moving to Work authorities hit a 95 percent voucher utilization rate in 2023, while only 78 percent managed to reach that rate for their budget, according to the researchers’ analysis, which follows HUD’s definitions of utilization rates.
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