In an obscure but public meeting last week, local and federal housing officials discussed a controversial idea that could transform U.S housing policy: What if the government gave money directly to renters, rather than relying on a complicated voucher system that drives both tenants and landlords up the wall? You’ve heard of universal basic income. What about universal basic rent?
The status quo is not working particularly well. More than half a million Americans experience homelessness on any given night, housing stock is in too-short supply, and rent and mortgage payments consistently rank among the heftiest bills families have to bear. For decades, most federal housing assistance has come in the form of a voucher program known as Section 8. But the program is cumbersome and bureaucratic. Landlords are often reluctant to jump through the government’s regulatory hoops to get the money, so they opt out. Because of funding constraints, only a quarter of those eligible for vouchers even get one, and those lucky few often must scour dozens of ads before finding even one unit that might accept the subsidy.
President Joe Biden promised during his campaign to make these vouchers available to all low-income families who qualify, and Congress is debating a measure as part of his economic package that would add roughly 750,000 more vouchers to the program. If it becomes law, that expansion would surely help some Americans find homes. But it wouldn’t solve the underlying problem: Most landlords don’t want to rent to voucher recipients.
[Read: How housing policy is failing America’s poor]
The coronavirus pandemic showed the viability of an alternative path—one that officials in Biden’s administration now seem willing to at least discuss. Congress tried a lot of things to help people struggling with the economic fallout from COVID-19. One initiative, a government-administered eviction-prevention program, has been mired in paperwork and delays, and only one-fifth of the money the feds allotted to it has been distributed. Another program, in which the IRS simply mailed Americans stimulus checks, got money in people’s hands right away.
These recent experiences might inform federal leaders as they research new ways to improve housing assistance. Last Thursday, at a public meeting organized by the Department of Housing and Urban Development, policy experts and housing-authority officials considered new voucher-program ideas that could merit formal study. Making vouchers more like cash for renters, as opposed to subsidies for landlords, was one of the top three ideas that emerged from the meeting, and it will be explored further at a second gathering later this month. The leading proposals could be tested under a HUD program known as Moving to Work, which has been around since 1996 but was expanded by Congress in 2016.
Distributing rental subsidies as cash was the second-most-popular idea discussed at the meeting, and participants acknowledged that it could involve a cost-saving element, too, as it would reduce, or even eliminate, the need for regular HUD inspections of voucher-eligible housing. At the conclusion of the three-hour session, committee members voted to continue their discussion of the idea at their next scheduled meeting, on October 28.
“I think it’s interesting in light of [universal basic income], and I think it would be interesting to decouple the government from trying to figure out the right type and size and quality of housing and leave that up to people,” Chris Lamberty, the executive director of Lincoln Housing Authority, in Nebraska, said at the meeting.
A couple of hours into the virtual call, Todd Richardson, the head of HUD’s research arm, noted that meeting participants seemed relatively excited about the cash-assistance idea. He warned, though, that it might not “pass muster” with the agency’s legal department. Asked for clarification as to what the legal concerns may be, a HUD spokesperson told The Atlantic that the public meeting posted on the Federal Register was not “intended for press” and “I don’t think we had put an invitation to the press.”
Moving to Work isn’t the only vehicle policy makers could use to test the idea of distributing cash-based rental assistance to tenants. Congress could also authorize a pilot study, like it did in 2019 when lawmakers approved a new voucher program to help families relocate to richer neighborhoods.
And in Philadelphia, starting early next year, a new study will explore how families fare when they receive rental assistance as cash. “There’s never been a full evaluation of using cash to renters for our tenant-based vouchers,” Vincent Reina, one of the University of Pennsylvania researchers who will assess the program, told me. “There’s been some explorations, but a true, proper evaluation is something that we’ve never really done.” Reina attributes the lack of study to political resistance. “Cash transfers are often more contentious,” he said.
The closest thing to a real test of the idea occurred in the 1970s, when Congress authorized the Experimental Housing Allowance Program. That program, which ran for longer than a decade in a dozen U.S. cities, provided cash assistance for housing directly to more than 14,000 low-income families. In a report filed to Congress in 1976, program evaluators noted that housing allowances were being well-received by their local communities and that the housing payments were being successfully administered to renters.
[Read: The power of landlords]
It’s clear that at least some current HUD staff are considering this old research. In 2017, Richardson published a blog post suggesting that the 1970s housing-allowance experiment could inform the Moving to Work program today.
Public-housing authorities might resist the idea, as it could require them to relinquish some control. Other authorities might lack trust that the funds would go toward rent. The findings from the Experimental Housing Allowance Program also suggested that cash subsidies could lead to lower-quality housing options for renters, though experts caution against drawing firm conclusions from the half-century-old study.
Studying the idea of cash rental assistance has great potential, Phil Garboden, a professor of affordable-housing economics, policy, and planning at the University of Hawaii at Manoa, told me. “I imagine vouchers will continue to exist in their current form for quite some time, but studying it is a terrific idea,” he said. “We absolutely do not have good data on it.” Garboden hopes researchers could tease out whether landlords avoid taking the vouchers mainly because they don’t like to deal with the red tape involved, or whether they’re simply resistant to renting to poor people.
Some renters might prefer the voucher status quo, but for others, cash could prove easier to use. Being able to pay for housing with cash or some dedicated housing subsidy might alleviate some of the administrative hassle that comes with navigating the U.S. welfare system—what the Atlantic writer Annie Lowrey coined “the time tax” earlier this year.
“Different forms of support work differently for different people, and a voucher could be a really effective mechanism for some households and some markets and less effective for others,” Reina told me. “It’s not to say vouchers can’t work, or can’t be improved, or shouldn’t be made universal, but we know through our existing voucher research that elderly households, households with kids, and households where the head is Black are less likely to use vouchers.”
Stefanie DeLuca, a sociologist at Johns Hopkins who was in attendance at Thursday’s meeting, told me that distributing housing assistance as cash could feel dignifying for some tenants. “The research on the Earned Income Tax Credit points to the idea that recipients experienced a sense of agency and dignity when they received a lump sum of money, and I suspect that renters being able to present themselves to landlords as paying like any other potential tenant could feel quite empowering,” she said.
Still, DeLuca’s own research suggests that the existing housing-voucher program could be improved in real ways to entice more landlords to participate, even in competitive markets. Researchers have been studying landlord signing bonuses and ways to get landlords their money faster. Even COVID-19 has helped hasten the digital streamlining of HUD contracts, making them less annoying to manage.
A new bipartisan bill introduced in May by Senators Chris Coons and Kevin Cramer would seek to remove red tape for Section 8 landlords. HUD is also beginning a new, major study of landlord incentives as part of its Moving to Work expansion.
And to be sure, one reason lawmakers have long resisted cash transfers is fear of political blowback. Over the years, Republican and Democratic politicians have embraced the myth that welfare rewards laziness, and that cash benefits in particular will spark public outrage.
But as we emerge from the pandemic, it’s clear that cash assistance to Americans is more politically viable—even more popular—than many in Washington previously thought. The U.S. government has also proved that it can cut checks quickly when it deems it necessary. In fact, distributing money can be easier than administering a byzantine social-insurance program that eligible participants may not even know about. If landlords continue to resist housing vouchers, perhaps the government will take that decision out of their hands and simply give renters cash.
