Sequester Squeezes Rental Assistance

NJ Will Lose 3,324 Vouchers

Sequester Squeezes Rental AssistanceAlthough Congress and the President eased the sequester for airline passengers, its impact on the homeless and those at risk of becoming homeless continues to grow.

An April 29th NPR story on All Things Considered highlighted the crisis facing housing authorities and rental vouchers as did a recent report by the Department of Community Affairs (DCA).

Housing authorities in NJ and across the country have all but stopped issuing rent vouchers as they try to deal with the cuts known as sequestration. Many newly issued vouchers have been rescinded, leaving some people homeless or doubled up with family and friends.

And the cuts – up to 3,224 vouchers in NJ – come at a time when there’s a severe shortage of affordable housing across the country especially in post-Sandy NJ.

The NPR story – Sequester Puts Some Needing Housing Aid ‘Back To Square One’ – highlights Melissa Rothkugel, 28, who had waited seven years for a housing voucher to help cover her rent in Connecticut.

She filled out the paperwork, attended orientation in Hartford and started to look for an apartment. But within days she was rushed to the hospital to give birth to a baby daughter. A week later, she got another letter that made her cry.

“It said, due to the budget cuts, that they were revoking my voucher,” she says. “So I was back to square one in being homeless again.”

In NJ in response to Office of Legislative services (OLS) the Department of Community Affairs stated:

Though the department has not received formal guidance from the federal government regarding the implementation of reductions caused by sequestration, a reduction of 5.26% in the appropriation for Housing Choice Vouchers is expected.

The department presently administers approximately 22,000 Section 8 Housing Choice Vouchers. Calendar Year 2012 spending totaled $220.4 million.

Due to budget contractual obligations only Tenant-Based Vouchers can be impacted by the cuts.

Therefore, any reduction in funding will impact Tenant-Based Vouchers. No present voucher holder will be impacted. Rather, the Department will limit the re-issuance of vouchers as turnover occurs. Approximately 125 vouchers turnover each month.

In addition, the department anticipates freezing at the current level the monthly rental subsidy. Based on a projected reduction of $10.77 million and the current average cost of monthly subsidy of $818.68, approximately 1,100 Tenant-Based vouchers will be lost.