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Policy for public housing raises concerns

Self-sufficiency plan by Bush said to limit options for poorest

PHILADELPHIA -- A Bush administration proposal to eliminate many of the federal rules requiring public housing authorities to serve extremely low-income people has generated widespread concern among housing advocates who say the change could prove ruinous for the nation's poorest families.

The plan, which is pending in Congress, would allow local housing authorities to charge higher rents, provide lower subsidies, and limit the amount of time tenants can remain in federally subsidized housing to as little as five years. Taken together, the changes would amount to one of the most dramatic policy shifts in the 68-year history of public housing.

Bush administration officials say the proposal suits the president's vision of promoting self-sufficiency and encouraging home ownership. But advocates and local housing officials worry that the changes will result in a reduction in an already inadequate supply of housing affordable to people mired in deep poverty.

''The changes would harm households with the most severe affordable-housing needs," said Douglas Rice, director of housing and community development for Catholic Charities USA. ''The shortage of affordable housing is one of the primary causes of homelessness, and extremely low-income households are most at risk of becoming homeless."

The proposal expands on previous administration efforts, largely thwarted by Congress, aimed at reducing long-term dependency on federal housing subsidies. Housing and Urban Development Secretary Alphonso Jackson, testifying before a House committee last month, said the plan would encourage tenants to move into market-rate rentals or to buy homes, with federal help for down payments and closing costs.

''The federal government has allowed families who declare no income to live rent-free and to receive a check to pay for utilities," Jackson said. ''There is little incentive for families to seek housing outside of the voucher program. In fact, there is a disincentive to make positive life decisions."

Jackson, who formerly headed housing authorities in Washington, St. Louis, and Dallas, said that the new rules would reward, with a greater share of federal housing aid, families striving to improve their lives. Current guidelines, he said, ''have shut the door on voucher assistance on low-income individuals who work hard to raise their income."

The proposed rules are part of what Jackson calls an effort to rein in the spiraling cost of federal housing subsidies while transforming public housing from ''a handout" for the deeply impoverished to ''a hand up" for the working poor. Jackson said the average housing assistance payment had gone from $411 per household per month in 2000 to $557 in 2004.

Tenant advocates and local housing officials say the poorest families would be forced to compete for a diminishing supply of housing subsidies. And even when they secure federal housing help, they say, the Bush administration's refusal to fund the programs at higher levels means that local housing authorities would be pressured to require poor tenants to pay a larger share of their income in rent.

Advocates say many of the 3 million families now in public housing or receiving federal housing vouchers that cover much of their rent in private housing do not earn enough to pay more.

''Public housing is a critical part of a pretty tattered safety net," said Barbara Sard, a housing specialist with the Center on Budget and Policy Priorities. ''The rule changes would have the effect of shifting money away from lower-income to higher-income folks."

The difficulty of moving tenants off federal housing subsidies is evident in Philadelphia. Operating under a federal pilot project since 2001, the Philadelphia Housing Authority has retooled policies with the aim of easing people off of lifelong public housing dependency and into home ownership or market-rate rentals.

The authority offers residents ''self-sufficiency" training on such matters as personal finance and property care. It has also imposed a seven-year limit on public housing residency, although its executives freely acknowledge that the limit is likely to be extended.

Still, the housing authority has been able to move just 151 families off the subsidy rolls and into homes of their own in the program's first four years.

Perhaps the toughest obstacle officials here confront is the stubborn pervasiveness of deep poverty. Nearly half of the families receiving public housing aid in Philadelphia have incomes under $8,000 a year. And only a fifth reported annual incomes above $20,000, according to the authority.

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