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Section 811 Supportive Housing for Persons with Disabilities 2006 HUD Budget Proposal
April, 2005

The President's budget proposes an unprecedented deep cut for the Section 811 Supportive Housing for Persons with Disabilities program. Section 811 is the only program at the Department of Housing Urban Development (HUD) that still produces accessible and affordable supportive housing for non-elderly people with disabilities with extremely low incomes.

Historically, new units of supportive housing produced through Section 811 have been targeted to people with the most severe disabilities who rely on SSI income of $600 or less per month. For almost 30 years, this program (and its pre-cursor the Section 202 program for people with disabilities) has been a cornerstone of state and local efforts to implement community integration strategies for people with severe disabilities who currently live in nursing homes, public institutions, or at home with aging parents.

The President's budget would cut Section 811 in half, dropping funding down to $120 million from its current level of $238 million. More importantly, the budget proposes to completely eliminate all funding for new unit production in FY 2006 by zeroing out the capital advance/project-based side of the program. Historically, 75 percent of HUD’s 811 appropriation has been used to fund capital grants and project-based rental assistance for non-profit disability groups to develop new fully wheelchair-accessible units of permanent supportive housing.

Instead, the President's FY 2006 budget proposes to direct the remaining $120 million in the Section 811 program to renewal of existing rent subsidies (both tenant-based and project-based), with a small amount left to fund new tenant-based subsidies. Specifically, $80 million would be directed to tenant-based renewals, $5 million for project-based renewals (also known as PRACs) and $35++ million of new 5-year tenant-based contracts (an estimated 1,000 – 1,100 vouchers). This means that more than 70% of all 811 funds would be consumed by the cost of renewing (i.e. keeping in place) housing funded under the program in previous years.

Moreover, the elimination of the capital advance/project-based side of the program would end HUD’s commitment to support the production of new housing targeted to non-elderly people with severe disabilities with the lowest incomes. Reliance solely on tenant-based assistance (portable rent subsidies that rely on voucher recipients being able to find rental housing on their own) also represents a major change in the targeting of 811 away from people with more severe impairments who need on-going housing-related supports and/or fully accessible units.

The Consortium for Citizens With Disabilities (CCD) Housing Task Force is a coalition of national disability organizations working to promote access to affordable housing opportunities and community supports for people with disabilities.

HOUSING FOR PEOPLE WITH DISABILITIES: THE CRISIS ESCALATES

Background

Being part of the community and living as independently as possible are among the most important values and goals shared by people with disabilities and their families, and advocates. A home of one’s own – either rented or owned, is the cornerstone of independence for people with disabilities. However, across the nation, people with cerebral palsy, mental retardation and related disabilities face a crisis in the availability of decent, safe, affordable, and accessible housing. Today many still live in large congregate facilities or other inappropriate places like institutions. Approximately 750,000 people with developmental disabilities live with aging parents (one of whom is over age 65). For people who use wheelchairs or other mobility devices, finding housing with even basic accessibility features (e.g. an entrance with no steps) ranges from daunting to impossible. This difficulty is magnified in rural areas where there is a scarcity of any rental housing and new units are rarely developed. In addition, the designation as “elderly-only” of almost half a million units of Department of Housing and Urban Development (HUD) funded public and assisted housing over the past 12 years has had a devastating impact on people with disabilities.

According to Priced Out in 2002, for the first time ever, the national average rent was greater than the amount of income received by 3.7 million Americans with disabilities who rely on monthly Supplemental Security Income (SSI) of $545 to pay for all their basic needs. Specifically, the average national rent for a modest one bedroom rental unit in the United States rose to 105 percent of SSI – up from 98 percent in 2000. In 2002, of the nation’s 2,702 housing market areas, there was not one single area where modestly priced rental units were affordable to people with disabilities receiving SSI.

Action Taken by Congress and the Administration

Section 811 Supportive Housing for Persons with Disabilities (Section 811)

Section 811 provides housing for people with physical or developmental disabilities, or people with chronic mental illness who are 18 years of age or older and have very low incomes (at or below 50 percent of the area median income). Section 811 participants may live in supportive housing units developed and owned by non-profit organizations or they may receive tenant-based rental assistance that helps them rent decent and safe housing in the private rental market. Tenants pay 30 percent of their adjusted income for rent which ensures affordability for those receiving SSI benefits.

The Administration’s FY 2006 budget proposes to slash Section 811 by 50% - dropping funds to $120 million from $238 million enacted in FY 2005. Most critically, the budget proposes to completely eliminate all funding for new unit production in FY 2006 by zeroing out the capital advance component of the program. This unprecedented cut ends an over 30 year commitment to support the production of new housing targeted to non-elderly people with severe disabilities.

Section 811 is the only HUD program that produces affordable and accessible housing for non-elderly people with disabilities. Historically HUD used 75 percent of Section 811 funds to provide interest-free capital advances to non-profit sponsors to help finance the development of fully accessible rental housing such as independent living projects, condominium units, and small group homes, many of which offer voluntary supportive services for people with severe disabilities. The Section 811statute also allows HUD to use up to 25 percent of the program’s funds for tenant-based rental assistance (known as the “Mainstream Housing Opportunity for People with Disabilities ” program).

Instead of maintaining the program’s longstanding commitment to production of new units, the Administration’s FY 2006 budget proposes a total appropriation of $120 million to be spent as follows: $80 million to renew existing Mainstream vouchers, $5 million for project-based renewals (also known as PRACs, which cover operating costs such as insurance and maintenance) and $35 million for new tenant-based assistance (an estimated 1,000 – 1,100 vouchers). Therefore under the Administration’s proposal more than 70% of all 811 funds would be consumed by the cost of renewing (i.e. keeping in place) housing funded under the program in previous years. Moreover, since 1997, when HUD started issuing “Mainstream” vouchers, it has failed to provide policy guidance to Public Housing Agencies (PHAs) or adequately track these vouchers to ensure that they were given to people with severe disabilities who are eligible for Section 811. Due to this lack of oversight, disability advocates believe that some vouchers have been issued to many who are ineligible – including non-disabled people.

Many people with severe disabilities either require supports or units with a higher degree of physical accessibility that is available in the private market. By limiting Section 811 funding solely as tenant based vouchers the Administration proposes a major change in the targeting of the Section 811 program – away from people with severe disabilities, who have the most significant housing needs. This proposal will relegate these individuals to institutions, nursing homes, or homeless shelters.

The disability community urges Congress to increase Section 811 funding by at least $129 million in FY 2006 to restore the program to its FY 2004 funding level and to require HUD to reinstate the capital advance/production component of the program.

Section 8 Rental Assistance

The Administration’s FY 2006 budget requests a total of $15.9 billion for the Section 8 Housing Choice Voucher program, $14.1 billion of which is for voucher renewals. No funding is proposed for new/incremental vouchers targeted for people with disabilities. This request will fund approximately 2 million vouchers – only 94 percent of the vouchers currently administered by PHAs. Full funding would allow PHAs to use all vouchers authorized by Congress. Prior to FY 2004, Congress fully funded all vouchers, including (from 1997-2001), vouchers targeted to people with disabilities. Since 2004 PHAs have not had sufficient funding to use all of their authorized vouchers.

Recommendations

Congress should:

Relevant Committees
House & Senate Appropriations Committees
House Committee on Financial Services
Senate Banking, Housing and Urban Affairs Committee

For more information, please contact The Arc and United Cerebral Palsy Disability Policy Collaboration (202-783-2229), Association of University Centers on Disabilities (301-588-8252), AAMR (202-387-1968), or NACDD (703-739-4400).

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