Friday, September 23, 2022

Metro Staff Tells Supportive Service Oversight Committee that RLRA Impacts on Voucher Tenants Not Their Job.

Metro's Supportive Housing Services Oversight Committee meets again on Monday Sept 26th. Not listed in the agenda but on the final page of the meeting package is a one page staff memo, RLRA Program Structure.  

That memo says that "The matter of RLRA's program design and whether that policy or design be changed is something the Tri-County Planning Body could consider" .

The memo then says that if the Committee has concerns they should "consider voting" on a formal recommendation to the TCPB. I note that the TCPB meetings to date have only been organizational and "onboarding" to date, with the next meeting in mid October. 

My response to the Metro staff memo is on page 41-43 in the meeting packet and includes my recommendations--that I first made in May this year: Either 1. Adopt a 120% of payment standard (not FMR) max for RLRA, or 2. Adopt a county wide payment standard at 100% of FMR. BOTH would still mean RLRA max rents would be higher than max voucher rents. 

In my transmittal I added the recommendation for a vote if necessary to make a referral to the TCPB. 

My most recent blog post HERE has links to all of my prior posts related to RLRA problems. 

That includes an Excel file that allows the user to see the difference in subsidy and housing choice for 1 bedroom voucher tenants vs RLRA tenants in ANY of the 12 payment standard areas in the three counties. The default entry uses income at the SSI level, but income can also be input by the user. 

I have pasted below graphics from earlier posts that show LIHTC rent and RLRA rent differences, and differences between boosted RLRA rents occurring October 31st as a result of a boost in HUD FMR's. 

Finally in my email transmittal I also noted that county quarterly reports had NO uniform RLRA reporting including 

  • NO breakout of RLRA by project based or tenant based 
  • NO breakout of RLRA by A/B categories. 
  • NO breakout of RLRA by demographics.
  • NO breakout of RLRA average costs by bedroom size



Originally created and posted on the Oregon Housing Blog

Monday, September 19, 2022

Excel Tool to Compare Housing Choice and Costs for Metro Regional Long Range Rent Assistance Housing Vs. HUD Vouchers Starts with Income at SSI Level.

On several occasions I have pointed out that Metro Regional Long Range Rental Assistance can cost more than HUD vouchers and that higher RLRA rents mean fewer families served and disproportionately more housing choices for RLRA tenants.  

Earlier this month I pointed out that 1 bedroom RLRA tenants could bring as much as $8,800  MORE per unit per year if used in LIHTC units. 

And at the start of the month I said that because of an increase in HUD Fair Market rents effective October 1st, the highest gap between RLRA maximum rent and the lowest payment standard would be $496 per month. 

I have now constructed an Excel tool that allows users to compare side by side  HUD voucher and RLRA housing choices, tenant rent payments, and subsidy costs. for each of the PHA created 12 payment standard areas in the three county area.

The one page Excel spreadsheet  HERE requires only 3 simple inputs.

  1. A pull down of the location/zip code for the payment standard area
  2. The reasonable rent and the and owner requested rent. (For simplicity purposes these are identical).
  3. The tenant income. 
The spreadsheet then shows
  1. The voucher and RLRA tenant paid rents and the share of their income for rent. 
  2. IF the voucher tenant paid rent is more than 50%, a STOP MESSAGE indicating that the voucher tenant CANNOT rent the unit. 
  3. The subsidy costs for vouchers vs. RLRA. 

Note: Cells other than those requiring input are locked. 

Gresham SSI Examples

In the default entries I have selected the Gresham payment standard area and a tenant income of $11,000 (about the 2023 single person SSI level).

Example one uses a rent reasonable/owner requested rent of $1,610, the same as the HUD 1 Bedroom FMR for FY 2023.  

Example two uses a rent reasonable/owner requested rent of ,$1,962 (the maximum RLRA rent of 120% of HUD Fair Market rent for FY 2023).

DEFAULT RESULTS For Gresham, Gresham / Fairview / Troutdale, Zip Codes 97019, 97024, 97030,97-60,97080. (Details pasted below).

In example one, rent at the HUD FMR, RLRA subsidy cost is $16,020

  • For the voucher holder the total tenant paid rent is $449, 49% of monthly income. 
  • For the RLRA tenant their share of rent is $275, 30% of Income.
  • For the voucher tenant subsidy totals $13,932 per year
  • For the RLRA tenant subsidy totals $16,020 per year, $2,088 /15% MORE subsidy than the voucher tenant. (and the RLRA tenant pays only 30% of their income for rent).

In example two, rent at the RLRA Max, RLRA subsidy cost is $19,844

  • The voucher tenant CANNOT rent the unit as their share of rent would be $771, 89% of income. NOTE that for the Gresham default payment standard area at $11K income, any rent level beyond the $1,610 FMR would push tenant rents higher than 50% since the $1,610 rent burden was at 49%.
  • For the RLRA tenant their share of rent is $275, 30% of Income.
  • For the RLRA tenant subsidy totals $19,844 per year,
Frame of Reference: Current Average Voucher Per Unit Costs Vary from $10,296 to $11,916 Annually.
HUD's voucher dashboard indicates that for the year through June voucher per unit cost annualized averages for the three PHA's are: 

Clackamas     $11,472/ $956 per month
Multnomah   $10,296/$858 per month
Washington  $11,916/$993 per month

NOTES: 
1. If larger bedroom sizes were used they subsidy difference would be HIGHER than shown here if income remained constant. 
2. If a lower than 30% share of tenant income for rent were used the subsidy costs would also increase from those shown here. 



Originally created and posted on the Oregon Housing Blog

Monday, September 12, 2022

Portland 1 Bedroom Metro RLRA Could Bring $8,800 In Annual ADDITIONAL Subsidized Rental Income To Each LIHTC Unit.

Back in May (page 25) I provided written comments to the Portland Metro Regional Oversight Committee on the costs of the RLRA program and potential adverse impacts on housing choice for HUD housing voucher tenants. 

I pointed out that the use of a uniform 120% of HUD Fair Market rent as the RLRA rent limit resulted in more than a 20% gap for voucher tenants as their housing choice was limited by PHA set payment standards that were often BELOW HUD (100%) Fair Market rents. 

Since then 

  1. PHA's have published higher payment standards to reflect a successful appeal of HUD FY 2022 fair market rents, and 
  2. HUD has now published FY 2023 Fair Market Rents that are effective October 1st. 

With these new HUD FMR's I thought it would be instructive to look at how much MORE 1 bedroom Portland Metro RLRA rents are compared to 2022 LIHTC rent limits set at 60% of MFI.  In the three counties I count 33,000 LIHTC units in the OHCS inventory with 15,000 units placed in service from 2010 to 2023. 

This comparison assumes that RLRA paid rents CAN exceed published LIHTC rent limits so long as the tenant paid portion of rent does not exceed the LIHTC rent limit. The assumption is also made that reasonable rent is the same as the projected $1,600, $1,700, $1,800 and $1910 rent levels used. 

For LIHTC owners this means they would receive a RLRA rent that is HIGHER than the $1,198 LIHTC rent limit, increasing rental income above prior limits.

My Estimates Are Conservative

To help to show how MUCH higher a RLRA rent could be compared to the LIHTC 1 bedroom Portland metro 60% MFI limit of $1,681 I constructed the graph pasted below. 

Because I use 2022 LIHTC rent limits, IF RLRA is used in a LIHTC unit already in service before 2022 is is likely that those units have LOWER LIHTC rents limits so the EXTRA (subsidized) income for RLRA units would be even HIGHER than shown on the graph.

Because I use the 60% MFI LIHTC rent limit, the EXTRA (subsidized) income to owners would be HIGHER for LIHTC units with 30% or 50% MFI rent limits. 

RESULTS:

  1. At the HUD October 1st FMR limit of $1,610 a RLRA tenant would bring $4,944/34% in ADDITIONAL annual rental income vs the maximum rent permitted ($1,198) for a LIHTC tenant with no assistance.  
  2. At the RLRA rent limit of $1,912 (120% of the HUD FMR of $1,610) a RLRA tenant would bring $8,808/61% in ADDITIONAL annual rental income vs the maximum rent permitted ($1,198) for a LIHTC tenant with no assistance.
  3. In all cases, since the tenant share of rent is a fixed percentage of their income, the source of additional income is RLRA subsidy. 


. Originally created and posted on the Oregon Housing Blog


Thursday, September 8, 2022

GAP Between 1 Bedroom HUD Voucher Payment Standard and Portland Metro's RLRA @120% of FMR Grows By $118, With Highest Gap Now $496 a Month.

 HUD has published FY 2023 FMR's and they include a boost for the Portland metro area. 

I have previously pointed out that Portland's Metro Permanently Supportive Housing program use of a blanket 120% of FMR rent standard creates a significant gap between the choice of housing available to HUD voucher holders and renters with Metro Regional Long Range Assistance. 

The FY 2023 FMR's, effective October 1st will widen that gap. 

Using a 1 BR size, the payment standards set by Portland metro housing authorities and 120% of the FY 2023 FMR at $1,932Metro could end up paying subsidy that is a much as $496 a month MORE than the HUD voucher payment standard for their Regional Long Range Assistance, so long as the RLRA rent is determined by the PHA to be "reasonable". 

Current Portland PHA set voucher 1 bedroom payment standards range from $1,436 to $1,588. Even if the rent for a HUD voucher holder is "reasonable" if it exceeds the payment standard the voucher holder has to pay 30% of their income PLUS 100% of the gap between the payment standard and the "reasonable" rent IF they continue to want to rent the unit. This effectively limits housing choices, especially compared to choice available to RLRA recipients. 

The chart below shows the difference between 120% of the FY 2022 and FY 2023 1 bedroom Portland metro FMR's and the current payment standards enacted by the housing authorities. (Housing authorities have 90 days to revise payment standards  and IF they do so I will make future revisions).



Originally created and posted on the Oregon Housing Blog.   


Tuesday, September 6, 2022

City of Portland Yearly and 5 Year Median Rent Increase Remains the Lowest in Portland Metro Area , Including Vancouver.

Apartment List monthly rent data for August is out

Their methodology is HERE.

The table pasted below has my summary of the 12 month and 5 year change in 2 bedroom median rents for Portland metro cities, Austin Texas, and Vancouver, Wa.. 

Two Headlines:  

  1. City of Portland Yearly and 5 Year Increase of 5.9% Remains the Lowest in the Portland Metro Area, Including Vancouver .
  2. Austin's Rent Was $60 BELOW the City of Portland 2 BR Median Rent 5 Years Ago, and It's Now $341 MORE than Portland's.
Additional Note: 
While likely not statistically significant, Portland's August 2022 $1,518 median 2 bedroom rent was BELOW Gresham's $1,519. 




Originally created and posted on the Oregon Housing Blog.