2017 Sacramento Regional Affordable Housing Summit Monday, October 30, :35 a.m. 10:30 a.m.

Transcription

1 2017 Sacramento Regional Affordable Housing Summit Monday, October 30, :35 a.m. 10:30 a.m. \ WORKSHOP SESSION 1 Section 8 Discrimination Denise McGranahan Senior Attorney Legal Aid Foundation of Los Angeles th St., Suite 124 Santa Monica, CA dmcgranahan@lafla.org 1

2 WHAT IS SECTION 8? 2 Section 8 voucher program s purpose: to aid [] lowincome families in obtaining a decent place to live and to promot[e] economically mixed housing. 42 U.S.C. 1437f(a). Leading form of low-income housing assistance in the country, paying a substantial portion of the rent for more than 5 million people in 2.1 million low-income households 75 percent of all new and turnover vouchers are targeted to extremely low income people (below 30 percent of AMI)

3 WHAT IS SECTION 8? In many housing markets, it is one of the key ways housing is provided to low-income tenants living on: Social Security disability and retirement, SSI, TANF, VA Benefits Vouchers may be used anywhere in the country, and provide the opportunity for housing selection in areas not segregated by race, national origin, or other protected traits. 3

4 WHAT IS SECTION 8? 4 Last resort for low income families. If family cannot find suitable housing, it has few remaining options: live on the streets or in the shelters, or double up with relatives.

5 HOW DOES SECTION 8 WORK? HUD pays rental subsidies to SMHA so eligible families can afford decent, safe, and sanitary housing. SMHA grants a voucher to a qualifying individual who selects an apartment and after inspection and a reasonableness test approves the apartment and tenancy, 5 SMHA contracts with the owner to make rent subsidy payments

6 HOW DOES SECTION 8 WORK? 6 The Section 8 program does not require that landlords rent to voucher-holders if the rent exceeds the amount that is reasonable or an amount that exceeds the maximum rent allowed by HUD. The SMHA is required by federal law to perform a criminal background check on all adult household members.

7 . THE REQUIREMENTS ARE BASIC AND STREAMLINED Property owner enters into a Housing Assistance Program (HAP) contract at the time that the lease agreement commences. 7 The HAP contract contains only very basic terms: It identifies the specific address and apartment, contract term, the amount the Housing Authority will pay monthly, the amount the tenant will pay monthly, and the utilities that the owner and tenant are respectively responsible for.

8 . THE REQUIREMENTS ARE BASIC AND STREAMLINED 8 Tenants typically contribute 30 to 40 percent of their income to the total rent. The PHA pays the difference and, the property owner receives the majority of the rent from the Housing Authority on time every month. The housing selected must meet health and safety laws which are no more onerous that what is required by Code Compliance or the Health Department Inspections every 24 months.

9 Federal Law Expressly Allows States and Local Jurisdictions to Mandate Landlord Participation 9 Nothing in part 982 (Section 8 Regulations) is intended to preempt operation of State and local laws that prohibit discrimination against a Section 8 voucher-holder because of status as Section 8 voucher-holder. 24 C.F.R (d) See, Rosario v. Diagonal Realty, LLC, NY Slip Op 5780, 4 (N.Y. 2007); Barrientos v Morton LLC, 583 F.3d 1197 (2009)

10 SECTION 8 STEREOTYPES 10 Researchers suggest: Attitudes people have about subsidized housing (and those living in such housing) are not based on reliable evidence or the realities of subsidized housing today, Based on stereotypes derived from past experiences with project-based housing that has not existed for over thirty years Scattered-site housing (e.g. housing where landlords accept vouchers) largely has a positive effect on neighboring property values

11 EFFECTS OF SOI DISCRIMINATION 12 SOI discrimination has a profound effect on the available housing choices and it perpetuates: the concentration of poverty, and racially and economically impacted neighborhoods. Increases Homelessness

12 STATE OF CALIFORNIA RECOGNIZES THE SECTION 8 PROBLEM CALIFORNIA ANALYSIS OF IMPEDIMENTS TO FAIR HOUSING: Inadequate access for minority households to housing outside of areas of minority concentration Minorities are more likely to live in poverty, have very low-incomes, and reside in Census tracts where they are over-represented. Discrimination against Section 8 voucher-holders is a contributing factor to this problem. 67% percent of Section 8 voucher-holders live in areas where minorities were overrepresented as compared to 57% of all minority households.

13 STATE AND LOCAL LAWS MAY PROHIBITS DISCRIMINATION 14 Across the country at least 12 states, many counties and cities have passed laws that limit landlords ability to refuse housing to prospective tenants based solely on their legal source of income, and many of these laws define vouchers as a legal source of income, California cities include: San Francisco, East Palo Alto, Corte Madera, Woodland, Marin The City of Santa Monica is one of the most recent municipalities to do so, voting unanimously to approve the ordinance in May of 2015

14 SOURCE OF INCOME LAWS WORK Shorter wait lists and shorter search times More selections of housing units in more and possibly more advantaged neighborhoods, Minorities more likely to move to wealthier areas where more likely to: work, earn more, less welfare May increase voucher utilization rates. Early research: probability of successfully using one s voucher within the time frame allowed was 12 percentage points higher in jurisdictions with an SOI protection law. 15

15 LOCAL ORDINANCES NECESSARY IN CALIFORNIA Federal law does not prohibit Section 8 discrimination but permits states and local governments to do so. 16 State of California does have source of income protection law, FEHA, but voucher tenants are exempted (See Sabi v. Sterling, 183 Cal.App.4th 916 (2010)) Recent efforts to amend FEHA to cover Section 8 have failed.

16 SANTA MONICA AFFORDABLE HOUSING PROBLEM Rising rents in Santa Monica have placed many lowincome and fixed-income persons at greater risk for homelessness. City has 4,475 extremely low-income renter households with a cost burden greater than 50 percent and 5,385 extremely low-income renter households with a cost burden greater than 30 percent. Lack of affordable housing is the principal factor leading to housing instability. 17

17 SANTA MONICA AFFORDABLE HOUSING PROBLEM Dramatic reduction of Santa Monica apartments that are affordable to low- and moderate-income households. In 1998, approximately 60 percent of the total housing supply in Santa Monica was affordable to low- and moderate-income households. By 2014, the proportion of affordable housing had fallen to approximately one-third 18

18 Section 8 Voucher Holders in Santa Monica Face Challenges Santa Monica lacks landlords willing to accept a voucher that pays much less than market rents This has created a scarcity of available units. Just 12 percent of Section 8 households reside in privately owned units not subject to deed restrictions. Limited access to more expensive areas of the city (except non-profit housing provider or inclusionary units) Even long-term rent-controlled tenants who obtain vouchers after waiting for 5+ years have been historically rejected. 19

19 SANTA MONICA PASSES LAW PROHIBITING DISCRIMINATION AGAINST VOUCHER HOLDERS On May 12, 2015 the Santa Monica City Council unanimously passed an ordinance prohibiting landlords from rejecting an application for tenancy solely based on the source of a tenant s income. Source of Income covers: 20 any lawful source of income or rental assistance from any federal, State, local or non-profit-administered benefit or subsidy program including, but not limited to, the Section 8 voucher program. SMMC Section (j).

20 Prohibited Activities It shall be unlawful for any person offering for rent or lease, renting, leasing, or listing any housing accommodation, or any authorized agent or employee of such person, to do or attempt to do any of the following: 21 (a) Refuse to rent or lease a housing accommodation, or access to or use of the common areas and facilities of the housing accommodation, serve a notice of termination of tenancy, commence an unlawful detainer action, or otherwise deny to or withhold from any person or persons, a housing accommodation on the basis of source of income..

21 Prohibited Activities 22 (b) Represent to any person, on the basis of source of income that a housing accommodation is not available for inspection or rental when such housing accommodation is in fact available for inspection or rental. (c) Make, print, or publish, or cause to be made, printed, or published any notice, statement, sign, advertisement, application, or contract with regard to a housing accommodation offered by that person that indicates any preference, limitation, or discrimination with respect to source of income..

22 ARE LANDLORDS REQUIRED TO ACCEPT SECTION 8 TENANTS? Landlords are not required to accept Section 8 tenants below their asking rate. 23 However, landlords cannot refuse to accept a Section 8 tenant if the reason is that they are on the Section 8 program Landlords can refuse for the same reasons they can refuse any other applicant (i.e. bad credit, bad rental history, criminal background)

23 LEGISLATIVE FINDINGS City of Santa Monica has commitment to: providing and preserving affordable housing 24 obligated under California and federal law to identify impediments to providing affordable housing and discrimination free housing and to develop strategies for removing those impediments.

24 The City found: LEGISLATIVE FINDINGS As real estate values increase and market rents skyrocket in SM, tenants with low incomes experience increased difficulties locating housing within the City. Voucher holders reported local landlords refused to rent to voucher holders, 25 Reports consistent with Housing staff s observations that Section 8 tenants experience disproportionate problems finding homes in Santa Monica

25 Santa Monica Ordinance Challenged On June 10, 2015, AAGLA and several individual landlords filed this action for declaratory and injunctive relief against the City, to invalidate the Ordinance, alleging it is on the grounds that it is: 1) preempted by the Fair Employment and Housing Act, Gov. Code Section 12955(p)(1); an invalid exercise of the City s police power; 3) violates the United States and California s Constitutions prohibitions against the impairment of existing contracts and the right to freely enter into new contracts; and 4) imposes additional burdens upon landlords subject to rent control and has a chilling effect on the property owner s fair return. 26

26 DOES FEHA PREEMPT LOCAL LAWS? The relevant language in FEHA is: (c) While it is the intention of the Legislature to occupy the field of regulation of discrimination in employment and housing encompassed by the provisions of this part, exclusive of all other laws banning discrimination in employment and housing by any city, city and county, county, or other political subdivision of the state, nothing contained in this part shall be construed, in any manner or way, to limit or restrict the application of Section 51 of the Civil Code. 27

27 NO PREEMPTION No express preemption by FEHA the field of regulation of discrimination in employment and housing encompassed by the provisions of this part. FEHA excludes discrimination against voucher holders, so no express preemption. Different purpose purpose of FEHA is protecting civil rights purpose of SM ordinance and SF ordinance is to address affordable housing problems to make the local Section 8 program more responsive to local affordable housing needs. 28

28 APPEAL AAGLA v. City of Santa Monica AAGLA filed a notice of appeal No briefing schedule Post v. City and County of San Francisco Appeal from TRO against Post for refusing to rent to Section 8 tenants in violation of SF ordinance (similar to Santa Monica s) Briefing completed Hearing soon 29

29 SM IS WORKING WITH LANDLORDS TO MAKE THE SECTION 8 PROGRAM WORK FOR THEM 30 The Section 8 voucher program is a critical part of the city's approach to dealing with an affordable housing crisis. On January 11, 2016, City requested that HUD increase payment standards because market rents were skyrocketing. The application was granted.

30 SMHA PAYMENT STANDARDS The SMHA has secured higher payment standards, so voucher holders can now pay higher rent to landlords. Unit Size Current Maximum Rent 0 Bedrooms $1,512 1 Bedroom $1,932 2 Bedrooms $2,640 3 Bedrooms $3,366 4 Bedrooms $3,366 (40th percentile of asking rents) 31

31 CITY INCENTIVES In April 2016, the city council approved a pilot program to incentivize new owner participation and maintain existing owner participation in the voucher programs. Key elements of the proposed HOUSE: Housing Opportunities Utilizing Subsidy Enhancements) pilot program include a signing bonus (up to $5,000), loss mitigation measure (security deposit reimbursement up to $4,000), liaison services, and targeted outreach. 32 A program to help rent-burdened rent-controlled tenants, with the goal of helping them retain their affordable housing and to prevent homelessness.

32 CONCLUSION CONTACT INFORMATION: Denise McGranahan Senior Attorney Legal Aid Foundation of Los Angeles th St., Suite 124 Santa Monica, CA dmcgranahan@lafla.org