Conservatives have long decried the dependency that safety-net programs can encourage—but reform requires knowledge of how such programs work, and few conservatives have shown interest in the details. Housing policy is one of the leading exhibits of this non-benign neglect. Though the federal government now spends far more on public housing—including vouchers—than it does on cash welfare, it has done little either to encourage the upward mobility of public-housing tenants or improve the physical condition of aging developments. Reform proposals have stalled for lack of high-profile sponsors.
This might be changing, however. As part of House speaker Paul Ryan’s conservative anti-poverty agenda, Republican House majority leader Kevin McCarthy of California is pushing legislation that could transform the culture of public housing. The Moving to Work Reform and Expansion Act takes its name from one of Bill Clinton’s unsung successes, whose lessons Democrats have overlooked. Moving to Work is a long-term federal pilot program permitting 34 of the nation’s more than 3,000 public-housing authorities to experiment with what amounts to local regulatory control. The program gives housing authorities broad discretion to use federal aid; for instance, if they save money on administration, they can use it to fund repairs. By providing federal assistance as a block grant, Moving to Work allows local authorities to avoid setting up separate bureaucracies for public housing and housing vouchers, both of which they must oversee.
Moving to Work lets local authorities mandate work requirements and time limits for new tenants (or those who agree to them as part of “self-sufficiency” programs). The program also permits changes to rent rules so that tenants can keep more of what they earn as they prepare for post-project life. Currently, public-housing voucher recipients and tenants must pay 30 percent of their income in rent—a requirement that operates like a punishingly high marginal-tax rate. A higher income translates into a higher rent, discouraging tenants from working and saving. In McCarthy’s home district of Tulare County, California, a fixed-rent program led to a 67 percent increase in incomes among those tenants participating.
Work requirements for public housing have yielded similarly positive results. In Atlanta, where virtually all public-housing buildings have been demolished and replaced by voucher support, the adoption of a work requirement sent the labor-force participation rate among public-housing residents skyrocketing, from less than 20 percent to more than 60 percent. (Tenants who don’t have jobs must still participate in education or training programs.) In San Bernardino, California, another Moving to Work experiment—tenant time limits—led residents’ incomes to rise by an average of 12 percent and employment among residents to jump 17 percent.
Expanding Moving to Work, as the House Republican leadership wants to do, should lead more local housing authorities to adopt such policies. Long waiting lists for public housing underscore the need for new approaches. In most places, once you get into a subsidized unit, it’s yours for life—no matter how much your income goes up, how many empty bedrooms you have, or how many needy people are on the waiting list. As Moving to Work expands, it promises to change the culture of housing assistance and encourage the kinds of life choices that increase income, savings, and upward mobility.
Make no mistake: housing assistance is closely correlated with long-term dependency. Only 4 percent of public-housing households are two-parent families with children. The median “tenure” for residents of both public-housing developments and voucher units is more than nine years; in New York City, the nation’s largest public-housing system, it’s 17 years.
McCarthy’s bill doesn’t mandate any particular reform; local housing authorities would have discretion. McCarthy’s bill also doesn’t limit housing authorities to one reform approach (as was the case with December’s omnibus spending bill, which expanded a diluted version of Moving to Work to 100 local housing authorities). If it becomes law, the new bill would expand the number of eligible housing authorities each year by as many as 25, at least ten of which would be located in small towns and rural areas. Decentralization and local control could be most useful in big-city housing authorities such as New York’s, which faces a multi-billion dollar maintenance backlog. Allowing the New York City Housing Authority to divert funds from administration to repairs would be a modest but important step. NYCHA could reduce its legendary waiting list (via time limits for new tenants) and make sure the elevators work again. Such reforms are long overdue. That the Paul Ryan-led Congress is actually trying to undertake them provides reassurance that serious reform conservatism—though endangered—remains alive.
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