Order Code RL33270
CRS Report for Congress
Received through the CRS Web
The Section 8 Housing Voucher Program:
Reform Proposals
Updated July 13, 2006
Maggie McCarty
Analyst in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

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The Section 8 Housing Voucher Program:
Reform Proposals
Summary
The Bush Administration has proposed eliminating the Section 8 Housing
Choice Voucher program and replacing it with a new program in each of the past
several years. While the specifics have changed, each proposal would significantly
alter key features of the current program, including its administration, funding
distribution, tenant contributions toward rent, initial and ongoing eligibility of
families, and the eligible uses of program funds.
The first proposal was referenced in the President’s FY2004 budget request and
was later introduced in the 108th Congress (H.R. 1841/S. 947). Called the Housing
Assistance for Needy Families Act of 2003, it would have created a new block grant
administered by states — rather than the local public housing authorities (PHAs) that
administer the current program — and eliminated many of the current rules
governing the program. Hearings were held on the legislation, although no further
action was taken.
Language to enact the second proposal, called the Flexible Voucher Program
(FVP), was included in the Administrative Provisions section of the President’s
FY2005 budget request. Under the FVP, PHAs would have retained administration
of the new grant program, although most of the federal Section 8 voucher rules and
regulations would have been eliminated. The Appropriations Committees did not
include the language in their versions, nor the final version, of the FY2005 HUD
budget, and authorizing legislation was not introduced before the close of the 108th
Congress.
The President’s FY2006 budget request again called for enactment of a Flexible
Voucher Program. During the first session of the 109th Congress, a modified version
of the FVP was included as Title I of the State and Local Housing Flexibility Act of
2005 (H.R. 1999/S. 771). The House Financial Services Committee held hearings
on the bill, although no further action has been taken. The President’s FY2007
budget request reiterates the Administration’s support for the bill.
Most recently, the House Financial Services Committee has approved a
bipartisan Section 8 voucher reform bill, the Section 8 Voucher Reform Act of 2006
(H.R. 5443). While notably narrower in scope than the President’s reform proposals,
if enacted, it would represent the first major reform of the program since the Quality
Housing and Work Opportunity Reconciliation Act of 1998 (P.L. 105-276).
This report includes a table comparing the key features of the recent proposals,
and will be updated to reflect relevant legislative activity.

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Contents
Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Current Program Features . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Eligible Uses of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Tenant Rents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Eligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Work Requirements and Time Limits . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Funding Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Reform Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Proposals from the 108th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Housing Assistance for Needy Families (HANF) . . . . . . . . . . . . . . . . . 6
The FY2005 Flexible Voucher Program . . . . . . . . . . . . . . . . . . . . . . . . 7
Proposals from the 109th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
The State and Local Housing Flexibility Act of 2005 . . . . . . . . . . . . . . 7
The Section 8 Voucher Reform Act of 2006 . . . . . . . . . . . . . . . . . . . . . 8
List of Tables
Table 1. Key Features of Recent Reform Proposals
Compared to Current Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

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The Section 8 Housing Voucher Program:
Reform Proposals
Recent Developments. On June 14, 2006, the House Financial Services
Committee approved the Section 8 Voucher Reform Act of 2006 (H.R. 5443). The
bipartisan bill, which is discussed later in this report, would make changes to the
existing Section 8 voucher program, but leave its basic structure intact.
Current Program Features
The Section 8 Housing Choice Voucher program has come under increasing
criticism from the Administration and Congress for its cost and its complexity.
Recent changes in the way the program is funded have largely addressed concerns at
the federal level about “spiraling costs”; however, the new funding structure has not
reduced budget pressures for the local public housing authorities (PHAs) that
administer the program.1 Noting these concerns, the Administration has argued in
each of the past several years that the existing Section 8 voucher program should be
dismantled and replaced with a new, broader-purpose grant program. While the
Administration’s reform proposals have changed every year, each has proposed to
alter several key characteristics of the current program, which are discussed below.
Administration. The current Section 8 Housing Choice Voucher program,
and its approximately 2 million vouchers, are administered by more than 2,500 local
PHAs across the country. PHAs vary greatly both in their size and their capacity.
Some administer as few as 10 vouchers, while one PHA, the New York City Housing
Authority, administers almost 90,000. Half of all PHAs administer 250 or fewer
vouchers.2 Some PHAs have a full-time director and a large staff; others have one
person serving part-time as director and staff.
This heterogeneity has been criticized by some researchers, housing advocates,
and the Administration. They argue that housing markets are regional, and thus that
housing programs should be administered on a regional level. They point out that
most other social service programs serving the low-income population — such as
Temporary Assistance for Needy Families, Child Care Assistance, and Food Stamps
1 For more information, see CRS Report RS22376, Changes to Section 8 Housing Voucher
Renewal Funding, FY2003-FY2006, by Maggie McCarty.
2 Written Testimony, Michael Liu, Assistant Secretary for Public and Indian Housing,
Department of Housing and Urban Development, hearing before the Housing and
Community Opportunity Subcommittee of the House Financial Services Committee, May
22, 2003.

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CRS-2
— are administered at the state level. If the voucher program were administered at
the state level, they contend, it might be easier to coordinate it with other services.
The organizations representing PHAs have disagreed, arguing in favor of the
current locally driven and focused system. PHAs have important local connections
with entities ranging from landlords to local zoning boards, connections that states,
they contend, would not have.3 Furthermore, they have expertise in administering
federal housing assistance for the poor both through the voucher program and the
federal public housing program.
Eligible Uses of Funds. Today’s voucher program provides a defined
subsidy, called a voucher, that a family can use to help pay its housing costs in the
private market. That voucher pays roughly the difference between rent and the
tenant’s contribution. In some cases, families can use their vouchers to help pay for
a mortgage, but only if their PHA chooses to run a homeownership voucher program.
The bulk of PHA funding, which comes from HUD, is used to renew vouchers. No
funds have been provided for new vouchers since 2002. PHAs earn administrative
fees, which they can use for other purposes, such as providing supportive services,
downpayment or security deposit assistance, or housing search assistance. This
system is governed by hundreds of pages of regulations and guidance that make the
program, some argue, overly prescriptive and difficult to administer. The
Administration and PHAs agree that the current structure limits the ability to
undertake innovative initiatives.
Reflecting this concern, the Bush administration has proposed redefining the
concept of a voucher by instead providing funds that could be used for rental
assistance, homeownership assistance, and supportive services, as defined by the
grantee. A “voucher” would no longer have uniform meaning, and PHAs could
provide more or less generous assistance to families at their discretion, outside of
most current federal rules (i.e., quality standards, portability, income targeting,
income-based rent, etc.). Such a reform would be consistent with the 1996 welfare
reform law that abolished the Aid to Families with Dependent Children (AFDC)
program and replaced it with a broader-purpose Temporary Assistance for Needy
Families (TANF) block grant.
Critics of this type of administrative flexibility at the PHA level contend that
many of the current rules governing the voucher program are designed to protect
voucher recipients. They worry that the needs of low-income families could go
unmet if federal rules are abandoned, especially if funding is constrained and PHAs
are forced to make difficult tradeoffs. Some further contend that without strong
oversight, broad block grants could be open to waste, fraud and abuse.
Tenant Rents. Under the current rules of the voucher program, families are
required to pay roughly 30% of their adjusted incomes toward rent.4 It is generally
3 National Association of Housing and Redevelopment Officials (NAHRO), NAHRO Direct
News: Section 8, May 29, 2003, attachment C.
4 The formula is actually more complicated. Families must pay the higher of 30% of
(continued...)

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accepted that housing is affordable for low-income families if it costs no more than
30% of their adjusted gross income, on the assumption that low-income families need
the full remaining 70% to meet their other needs. However, this figure is somewhat
arbitrary. For some families with little work, transportation, medical, child care, or
other outside costs, 40% or even 50% of income might be a reasonable contribution
toward housing costs. In fact, the current voucher program allows families to choose
to pay up to 40% of their incomes toward housing costs initially, and even greater
amounts upon renewal of a lease. For other families, with high expenses for work,
transportation, medical, child care, or other outside costs, some percentage lower than
30% might be the most reasonable contribution.
Critics of the current rent calculation, including the Bush Administration and
some PHA groups, have argued that PHAs should have the flexibility to modify the
existing income-based rent system or adopt new systems partially or fully decoupled
from income, such as flat or tiered rents. Under flat rents, families pay a PHA-
determined, fixed below-market rent, based on unit size, regardless of their incomes.
As incomes change, rent would stay the same. Current law permits PHAs to set flat
rents for public housing. Families are permitted to choose to pay flat rents, but must
be permitted to switch back to income-based rents. Under tiered rents, PHAs set
different flat rents for broad tiers of income. Families pay the rent charged for their
income tier, and only fluctuations in income that move them from one tier to another
would change their rent. Unless flat or tiered rents were set low, the change would
generally result in shallower subsidies paid to families. Shallower subsidies would
allow PHAs either to save money or serve more people with the same amount of
money, depending on the authority provided by HUD and Congress.
Another argument in favor of moving from an income-based rent to a flat rent
concerns administrative ease. The current complicated rent calculation, paired with
the difficulty of verifying the incomes of tenants, has led to high levels of error in the
subsidy calculation. According to a HUD 2001 Quality Control study, 60% of all
rent and subsidy calculations contained some type of error. HUD has estimated an
annual $2 billion in subsidy over- and under-payments in the Section 8 voucher
program. These errors have led the Government Accountability Office (GAO) to
designate the Section 8 program a “high risk” program, meaning that it is particularly
susceptible to waste, fraud, and abuse. Beginning with the FY2003 Consolidated
Appropriations Act (P.L. 108-7), HUD was given access to the National Directory
of New Hires, a database that may allow PHAs to better verify income data. There
has been some improvement. A 2003 Quality Control study released in 2004 found
a 37% reduction in erroneous payments from 2001, although 40% of subsidies were
still erroneously calculated. Adopting flat or tiered rents could substantially reduce
— if not eliminate — errors in rent calculations.
Another argument in favor of a flat rent structure involves the work
disincentives inherent in the current calculation. Since rent goes up as income goes
up, families have a disincentive to increase earnings and/or an incentive to hide
4 (...continued)
adjusted income, 10% of gross income, the amount of welfare benefits designated for
housing costs, or PHA minimum rents (which can be no higher than $50 a month).

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CRS-4
income. Families, therefore, face an effective 30% tax on any increase in earnings.
To get around this problem in the Public Housing program, Congress has instituted
a mandatory income disregard; however, no such mandatory disregard exists in the
voucher program.5 If PHAs choose to disregard increased earnings, they must pay
the difference out of their own budgets or face sanctions from HUD for not
accurately calculating subsidies. Under flat or tiered rents, families can generally
increase their earnings without facing changes in their rents.
Low-income housing advocates generally support income-based rents over flat
rents. Flat rents are not as responsive to changes in family income as income-based
rents, and their adoption can result in families paying much less or much more
toward rent than is generally considered affordable (30% of income).
Eligibility. The current voucher program sets initial eligibility for assistance
at the very low-income level (50% or below of area median income (AMI)), with a
requirement that 75% of all vouchers be targeted to extremely low-income families
(30%, or below AMI).6 The Administration has advocated raising eligibility levels
and loosening targeting requirements. They argue that both penalize working
families by limiting their eligibility for assistance. Further, serving higher income
families could result either in cost savings or the ability to serve more families with
the same amount of money. Low-income housing advocates generally support
retaining current income eligibility and targeting requirements. They argue that the
lowest-income households face the heaviest rent burdens and are the most in need of
assistance.
Work Requirements and Time Limits. The voucher program does not
currently have time limits or work requirements. Families that receive voucher
assistance can retain that assistance until either they choose to leave the program;
they are forced to leave the program (due to non-compliance with program rules or
insufficient funding); or their income rises to the point that 30% equals their housing
costs, at which point their subsidy is zero. The Public Housing program does have
a mandatory eight-hour work or community service requirement for non-elderly, non-
disabled tenants; however, most public housing residents are exempted, and it is
unclear how thoroughly the provision has been implemented.7
Some have advocated setting time limits for receipt of voucher assistance and
making work a requirement for ongoing eligibility. They argue that under the current
system, families have no incentive to increase their incomes or work efforts and leave
the program. This concern is exacerbated by the fact that many communities have
5 There is a mandatory earned income disregard applicable only to disabled families in
certain situations. For more information, see The National Housing Law Project’s Earned
Income Disregard Packet for Public Housing Voucher Program and Other HUD Programs,
available at [http://www.nhlp.org/html/pubhsg/eid_packet.htm].
6 For example, 50% of AMI in Missoula, MT was $24,050, and 30% was $14,450 in 2005.
Fifty percent of AMI in San Francisco, CA was $50,900, and 30% was $30,550 in 2005.
7 For more information on the community service/work requirement in public housing, see
CRS Report RS21591, Community Service Requirement for Residents of Public Housing,
by Maggie McCarty.

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long waiting lists for assistance, and since new vouchers have not been funded for
several years, turnover in the current program is the only way to bring in new
families.
Adopting a work requirement in the voucher program may help encourage non-
elderly, non-disabled households that are not currently working to go to work,
although it may not increase their incomes. Research based on the 1996 welfare
reform changes (P.L. 104-193) indicates that for many poor families, increases in
work do not necessarily translate into greater total income, and most households need
work supports (such as child care and transportation assistance) in order to make
them successful in becoming financially self-sufficient.8 Such supportive services
are not currently part of the voucher program, and would require additional funding.
Furthermore, there is evidence that families with children, those most likely to
be affected by work requirements and time limits, leave the program relatively
quickly. According to HUD research from 2003, the median length of stay for
families with children is two and a half years.9 Further, it is unclear how low-income
families would meet their housing costs after leaving the program if their incomes
had not risen significantly. HUD conducted research looking at families with
children who left the voucher program over a five-year period, and found that less
than 1% of them had incomes sufficient to afford an apartment at the fair market rent
in their community.10
Another option would give incentives to families to increase their work efforts
and therefore their incomes. Non-elderly, non-disabled families could be encouraged
to find and increase work through expansions in the Family Self-Sufficiency
program, which provides work supports and deposits tenant rent increases resulting
from work into escrow accounts on their behalf. Low-income housing advocates
generally support expanding the FSS program, which encourages work and increases
in earnings. However, expanding FSS would not result in cost savings, since as
families’ incomes rise, their rent increases are deposited in an escrow account.
Funding Allocation. Prior to FY2003, HUD reimbursed PHAs for the actual
cost of their vouchers. The cost of a voucher is equal to roughly the difference
between the rent (capped by a maximum set by the PHA and called the payment
standard) and the tenant’s contribution toward the rent (30% of the tenant’s income).
PHAs’ costs would fluctuate as tenants’ incomes and market rents increased or
decreased. Each year, HUD would ask Congress for funding sufficient to cover what
HUD anticipated it would take to fund PHAs’ costs.
8 See CRS Report RL30797, Trends in Welfare, Work and the Economic Well-Being of
Female-Headed Families with Children: 1987-2002, by Thomas Gabe.
9 Jeffery Lubell, et al. Work Participation and Length of Stay in HUD-Assisted Housing
U.S. Department of Housing and Urban Development, Office of Policy Development and
Research, Cityscape: A Journal of Policy Development and Research, Volume 6, Number
2, 2003.
10 Department of Housing and Urban Development, Performance and Accountability Report,
FY2004, p.2-65.

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Due partly to changes in the rental market and partly to changes in the rules of
the voucher program (such as increases in the payment standard), PHAs’ actual costs
began rising rapidly in 2002 and 2003.11 This raised concerns for both the
Administration and Congress. Partly in response to these cost increases, the
Administration proposed potentially cost-saving changes in both the way that PHAs
received funds and in the underlying factors that led to the cost growth, including the
amount tenants were asked to contribute toward rent and the maximum payment
standard as a part of each of their reform proposals.
Congress reacted by changing only the way that PHAs receive their funding.
Rather than being reimbursed for their actual costs, PHAs in recent years have
received a budget based on what they received in the previous year.12 This new
funding formula has led to problems for many PHAs, whose actual costs are still
driven by the difference between rents and incomes in their communities while their
funding is capped. As a result, some PHA groups have called for either a change
back to an actual cost funding formula or a change in the structure of the voucher
program that would allow them to better control their costs.
Reform Proposals
Every year since 2003, the President has proposed eliminating the Section 8
voucher program and replacing it with a new initiative. Authorizing legislation has
been introduced in Congress in two of those three years, although no further action
has been taken. Most recently, a bipartisan voucher reform bill, which would modify
the voucher program but largely retain its current structure, was approved by the
House Financial Services Committee. Proposals from the 108th and 109th Congresses
are discussed briefly below; a comparison of bills from the 109th Congress to current
law can be found in Table 1.
Proposals from the 108th Congress
Housing Assistance for Needy Families (HANF). The 2003 HANF
program (H.R. 1841 and S. 947, 108th Congress) was a Bush Administration initiative
that would have replaced the existing tenant-based voucher program that is
administered by local PHAs with a formula grant to states. Rather than receiving
funding for a fixed number of units, states would have received a fixed budget,
proportional to the amount of funds the state was receiving under the Housing Choice
Voucher program. States would have had broad discretion in how they used their
funds, including for homeownership purposes. The Secretary of HUD would have
been permitted to lower the 75% targeting requirement to 55%, impose minimum
rents, increase eligibility to 80% of area median income, and reduce the frequency
of housing quality inspections from annually to every three years.
11 See Government Accountability Office, Policy Decisions and Market Factors Explain
Changes in the Costs of the Section 8 Programs, April 2006.
12 See CRS Report RS22376, Changes to Section 8 Housing Voucher Renewal Funding,
FY2003-FY2006, by Maggie McCarty.

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Low-income housing advocates opposed HANF out of concern that it could lead
to an erosion of funding and that it would not serve low-income families adequately.
PHA groups opposed the proposal to transfer administration to states and also voiced
concerns about erosion in funding levels. HANF was not acted upon in the 108th
Congress, although multiple hearings were held.
The FY2005 Flexible Voucher Program. The President’s Flexible
Voucher Program (FVP), was first recommended in the second session of the 108th
Congress in the Administrative Provisions section of the FY2005 HUD budget
request. The HUD Secretary testified that the Department did not plan to pursue
authorizing legislation. Rather, officials stated during a hearing before the VA, HUD
and Independent Agencies Appropriations Subcommittee on March 4, 2004, that they
appreciated the leadership of the Appropriations Committees and were asking them
to include the provision in the FY2005 appropriations bill.
The proposal, like HANF, would have replaced the voucher program with a
broader-purpose grant program. Unlike HANF, PHAs would be asked to administer
the FVP. They would have received a fixed number of dollars that they could have
used to serve as many families as they chose, providing a broad range of assistance
ranging from cash grants to ongoing rental assistance. HUD would have eliminated
caps on on how much families could be required to contribute towards rent, increased
income eligibility to 80% or below of AMI, and eliminated any targeting
requirements.
The House Financial Services Committee, in their Views and Estimates of the
President’s FY2005 Budget, was critical of the President’s FVP proposal. The
Chairman of the Senate VA, HUD and Independent Agencies Appropriations
Subcommittee stated in a hearing on April 1, 2004, that the Flexible Voucher
proposal was “a poor substitute for flaws in the program” and that the Committee
would not have the “luxury of time to consider fully” the proposal.13 The FVP was
not enacted before the end of the 108th Congress.
Proposals from the 109th Congress

The State and Local Housing Flexibility Act of 2005. The
Administration’s State and Local Housing Flexibility Act of 2005 (SLHFA) was
introduced by Senator Allard on April 13, 2005 and by Representative Gary Miller
on April 28, 2005, as S. 771 and H.R. 1999, respectively. The bill consists of three
titles. Title I, The Flexible Voucher Act, is discussed further below. Title II, Public
Housing Rent Flexibility and Simplification, would permit PHAs to alter income and
rent calculations for public housing in the same ways as under Title I. Title III, the
Moving To Work Program, would make the current Moving to Work demonstration
a permanent program with expanded eligibility for PHAs, and expanded waiver
authority for the Secretary of HUD.
13 Statement of Senator Kit Bond, VA- HUD Appropriations Subcommittee FY2005 Budget
Hearing, Apr. 1 2004.

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Title I of SLHFA is similar to the Flexible Voucher Program proposed by the
Administration as part of the FY2005 budget request. It would replace the current
voucher program with a broader-purpose grant program. PHAs would continue to
administer the program, although if they were not meeting the Secretary’s
performance standards, their funds could be awarded to other entities selected by the
Secretary.
Flexible Voucher Program funds could be used for six eligible activities:
tenant-based rental assistance; project-based rental assistance; tenant-based
homeownership assistance for first-time homebuyers; self-sufficiency activities,
including escrow savings accounts; other activities, as specified by the Secretary, in
support of tenant-based, project-based, or homeownership assistance; and
administrative costs. Income eligibility, targeting, subsidy determination, and quality
inspection rules would all be loosened, while portability and enhanced voucher
features would be restricted. The Secretary would be directed to develop temporary
implementing regulations within 90 days of passage, and final regulations, not
including funding formulas, within 18 months. The Secretary would be directed to
undertake negotiated rulemaking to develop grant and administrative fee allocation
formulas, to be published within 24 months.
Hearings were held on the SLHFA in the House on May 11, 2005; hearings have
not been scheduled in the Senate. The President’s FY2007 budget request,
introduced on February 6, 2006, reiterated HUD’s support for the bill.
The Section 8 Voucher Reform Act of 2006. On May 22, 2006, the
Chairman of the Housing and Community Opportunity Subcommittee of the House
Financial Services Committee introduced the Section 8 Voucher Reform Act of 2006
(H.R. 5443), a bipartisan Section 8 reform bill cosponsored by the subcommittee’s
ranking member. It was approved by the subcommittee on June 8, 2006, and by the
full committee on June 14, 2006.
Unlike the Bush Administration proposals, which sought to eliminate the
voucher program and replace it with a new program, H.R. 5443 would retain the
basic structure of the current voucher program while implementing changes primarily
designed to make the program easier to administer. Specifically, the bill would
! modify the current definition of income to exclude imputed income
from assets;
! eliminate or replace many of the deductions and allowances from
income;
! provide PHAs with several methods for calculating income;
! change the targeting threshold to the greater of 30% of AMI or the
poverty level;
! eliminate the gross income calculation for rent;
! modify income reexamination requirements; and
! modify the process and timing for conducting housing inspections.
Several of these administrative changes would also affect the public housing and
project-based Section 8 programs.

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H.R. 5443 would also adopt a new renewal funding formula, authorize the use
of vouchers to provide downpayment assistance, require the Secretary to develop
performance standards, and expand and make permanent the Moving to Work
demonstration. Amendments added during full committee consideration would
authorize a Manufactured Housing pilot, alter the treatment of certain military pay
for purposes of several housing programs, and increase the rent levels for certain
project-based vouchers in low-income housing tax credit properties.
H.R. 5443 has received endorsements from PHA groups and low-income
housing advocates. Given the limited time before the end of the 109th Congress, it
is unclear whether the full House or Senate will consider the bill before adjournment.

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Table 1. Key Features of Recent Reform Proposals Compared to Current Law
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Section 8 Housing Choice Voucher Program
Administering Body
The majority of voucher programs
are
No change from current law.
PHAs would be permitted to administer the
administered by local, quasi-governmental public
Flexible Voucher Program (FVP). If a PHA
housing authorities (PHAs), although state
were not organized or the Secretary determined
housing agencies often serve as PHAs. Where
the PHA was not capable of effectively
no PHA has been organized or where the
administering the assistance, the Secretary could
Secretary determines that the PHA is unwilling
choose “any other entity” to administer the grant.
or unable to implement a program or is not
It does not limit other entities to public or private
performing effectively, the Secretary or another
nonprofits. (Sec. 103(14))
public or private nonprofit organization can
serve as a PHA. (42 USC 1437a(b)(6))
Type of Assistance
The Secretary may provide assistance to PHAs to
No change (see Downpayment Assistance).
The Secretary would be permitted to provide
provide tenant-based assistance to low-income
grants to PHAs to provide tenant-based rental
families. The PHA is to use a payment standard
assistance, project-based rental assistance,
to determine the amount of assistance provided
tenant-based homeownership assistance, and
to a family. (42 USC 1437f(o)(1) The rental
related assistance, including self-sufficiency
assistance — or housing assistance payment
programs. (Sec. 104 and 108)
(HAP) — covers monthly rental subsidies and
utility costs. The assistance may also be used to
provide project-based assistance and
homeownership assistance. (42 USC
1437f(o)(13) and (y))

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Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Project-based vouchers
PHAs may attach up to 20% of their vouchers to
Same, except would permit a higher maximum
PHAs would be permitted to use up to 20% of
existing housing units. No more than 25% of
rent for project-based vouchers in Low-Income
their funds to provide project-based assistance.
units in a building may have project-based
Housing Tax Credit Units. (Sec. 13)
No more than 25% of units in a building could
vouchers attached to them. Families living in
have project-based vouchers attached to them.
units with project-based vouchers are permitted
Families would be permitted to move after one
to move after one year. (42 USC 1437f(o)(13))
year, subject to sufficient funding. (Sec. 108(b))
Downpayment
A PHA may, in lieu of providing monthly
Downpayment assistance would be authorized,
Same as H.R. 5443 (Sec. 108(c))
assistance for
assistance payments, provide a downpayment
not subject to direct appropriations, for eligible
first-time homebuyers
grant for an eligible first time homebuyer less
families who had been receiving assistance for at
than or equal to the sum of the monthly
least 12 months. Downpayment assistance
assistance payments the family would have
would be provided as one-time-only grants,
received for a year. The availability of
capped at $10,000, to be used by families as a
downpayment assistance is subject to direct
contribution toward downpayment and
appropriations, and since direct appropriations
reasonable closing costs. (Sec. 8)
have never been provided for this purpose,
downpayment assistance has never been
provided in the voucher program. (42 USC
1437f(y))
Eligibility
Generally, families are initially eligible if they
The bill would not change income eligibility,
Families would be initially eligible if they were
are low income (80% or below of area median
although it would change the definition of
low-income, did not have significant interest in
(Also applies to Public
income (AMI)) and are either very low-income,
income, which would affect eligibility (see
real property or have assets exceeding a limit set
Housing (PH) and
(at or below 50% of AMI), were previously
“Income” below). It also sets an asset test such
by the Secretary. (Sec. 107(a) and 202(b))
Project-based Section 8
receiving assistance, or meet other criteria
that assistance could not be provided to families
R e n t a l A ss i s t a n c e
established by the Secretary. (42 USC 1437a(a)
whose net family assets exceeded $100,000 or
(PBRA))
and 42 USC 1437f(o)(4))
who had present ownership interest in real
property suitable for occupation and in which the

---

CRS-12
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
family had the right to reside. (Sec. 4(a))
Income Review and
The PHA must review family income upon
Income would be reviewed initially and
Income would be reexamined every other year
Continuing Eligibility
selection for assistance and annually thereafter.
reexamined annually thereafter, except:
and every three years for elderly or disabled
If a family’s income rises above the low-income
-families could request reexamination earlier if
households. Upon income re-examination, if
(PH and PBRA)
level, they may continue to receive assistance.
their income drops by $1,500;
family income were to have risen above the low-
(42 USC 1437a(a)(1)) If a family experiences a
-income must be reexamined at any point that
income level, the family would no longer be
change in income, they may request a mid-year
income rises more than $1,500 (increases in
eligible for assistance. (Sec. 107 and 202(b))
reexamination.
earned income are not counted for this purpose
unless the family’s income had been reexamined
because of a drop in income);
-families on fixed incomes would be permitted to
self-certify their income each year for up to three
years. (Sec. 3(a))
Upon income re-examination, if family income
were to have risen above the low-income level,
the family would no longer be eligible for
assistance. (Sec. 4(a))
Definition of Income
The term income means income from all sources
The bill would strike the definition and replace it
The term gross income would be defined as
from each member of the household, as
with a definition that includes income from all
income from all sources for each family member
(PH and PBRA)
determined in accordance with criteria prescribed
sources, including recurring gifts and receipts,
of a household without deductions or exclusions,
by the Secretary. The definition of income
actual income from assets, and profit or loss
notwithstanding any other provision of law. (Sec.
adopted in regulation includes imputed returns
from business. It excludes imputed returns on
103(8) and 202(b))
on assets and excludes income in excess of $480
assets, all earned income from dependent full-
for full-time students (including head of
time students, other mandatory federal
household and spouse). (42 USC 1437a (b))
exclusions, and other exclusions set by the
Secretary. (Sec. 3(b))

---

CRS-13
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Deductions
-$400 for elderly or disabled families,
Would replace current deductions with:
No deductions established.
from Income
-certain unreimbursed medical expenses above
-$750 for each elderly or disabled family
3% of a family’s income,
-$500 for each minor dependent
(PH and PBRA)
-reasonable child care expenses that allow for a
-Certain unreimbursed medical expenses greater
family member to be employed or further his or
than 10% of income for elderly and disabled
her education,
families
-$480 for each member of the household who is
under 18, a full-time student, or over 18 and
Deduction amounts are to be adjusted annually
disabled,
by an inflation factor set by the Secretary and
-child support, up to $480 per child (subject to
rounded down to the nearest multiple of $25.
appropriations),
(Sec. 3(b))
-spousal support (subject to appropriations),
-earned income of minors,
-earned income for certain Section 8 residents
(subject to appropriations),
-other permissible exclusions as determined by
the PHA. (42 USC 1437a(b))
Income Calculation
Not specified in statute, but in regulation, HUD
PHAs would be permitted to use prior year’s
Not specified.
has established a system for calculating income
income (if it had been determined by the PHA)
(PH and PBRA)
that attempts to predict income in the coming 12
to determine next year’s income. Earned income
months and requires third-party verification.
would be calculated as the previous year’s
earned income, minus 10% (only when
calculating rent). If prior year’s fixed income
were used, the PHA would be required to apply
inflationary adjustments, as determined by the
Secretary. PHAs could make other adjustments
as appropriate to reflect current income. PHAs

---

CRS-14
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
can use income calculations used in other
programs (such as TANF, Medicaid, Food
Stamps). (Sec. 3(a))
Targeting
Of families initially provided assistance in any
Of families initially provided assistance in any
Of families selected for assistance during a one-
fiscal year, PHAs must target 75% of all
fiscal year, PHAs would be required to target
year period, PHAs would be required to target
vouchers to those at or below 30% of area
75% of vouchers to those at or below the higher
90% of all assistance to families at or below 60%
median income (AMI). (42 USC 1437f(o)(4) and
of 30% of AMI or the poverty line. (Sec. 5)
of AMI. (Sec. 107(c))
1437n(b))
Subsidy Levels
Benefits are statutorily set as rental subsidies
No change.
PHAs would be permitted to establish their own
and Rents
equal to the difference between the lesser of rent
methodology for setting reasonable and
or the payment standard (set by the PHA at
appropriate subsidy levels and would not be
between 90%-110% of the fair market rent
required to use FMR. However, they would be
(FMR)) and the tenant’s contribution (see
required to set a maximum subsidy level. (Sec.
below). (42 USC 1437f(o)(1)(B)) Rents charged
109) If the PHA provided downpayment
for assisted units must be reasonable compared
assistance, the maximum grant would be
to comparable dwelling units in the private
$10,000. (Sec. 108(c)) Rents charged for
market. (42 USC 1437f(o)(10)(A))
assisted units would be required to be reasonable
compared to modest, non-luxury unassisted units
in the local market and reasonableness would be
required to be assessed annually. (Sec. 109 )
Tenant Contribution
Tenant contributions are statutorily set as the
Same as current law, except the 10% of gross
PHAs could establish rents based on a percentage
greater of 30% of a family’s adjusted gross
income contribution would be eliminated. (Sec.
of income, flat rents, tiered rents, or some
(PH and PBRA)
income, 10% of a family’s gross income, welfare
3(c))
combination of the three models, at their
rent (the amount of a welfare benefit designated
(Only for voucher program)
discretion. There would be no cap on tenant
for housing costs) or the minimum rent (set by
contributions. PHAs would be required to set

---

CRS-15
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
the PHA, not to exceed $50, with a hardship
minimum rents. (Sec. 109 and 202(b))
exemption). Families cannot be required to
contribute more than 30% of their adjusted
incomes, although they can choose to contribute
up to 40% in the first year and higher thereafter.
(42 USC 1437a(1) and 1437f(o)(2))
Termination, Time
Current law does not include any time limits or
Same as current law, although families whose
PHAs would be able to set standards for
Limits, and Work
work requirements. Families can continue to
gross incomes increased above 80% of AMI
continued eligibility, including time limits and
Requirements
receive assistance (even if their incomes increase
would lose eligibility for assistance. (Sec. 4(b))
work requirements. Beginning in January 2008,
above 80% of AMI) as long as they remain
PHAs would be permitted to establish time limits
compliant with program rules. Once their
of no less than five years (term limits would not
incomes increase to the point that their tenant
apply to elderly and disabled families). Families
contribution is equal to the rent, their subsidy is
whose gross incomes increased above 80% of
zero.
AMI would lose eligibility for assistance. (Sec.
107(d))
Enhanced Vouchers
Families receive enhanced vouchers when they
No change.
Enhanced vouchers would be administered under
are displaced from other rental assistance
current rules for one year. After one year,
programs (when project-based Section 8
enhanced vouchers would be administered under
contracts for private units end). Enhanced
the local FVP rules. (Sec. 115)
vouchers are administered by the local PHA. The
payment standard for an enhanced voucher is
equal to the rent for the unit (even if it is greater
than the PHA’s payment standard), allowing a
family that would otherwise be displaced to
remain in that unit. The “enhanced” feature of
the voucher remains for as long as the family

---

CRS-16
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
lives in the unit. (42 USC 1437f(t))
Inspection of Units
PHAs must inspect units to ensure that they meet
The requirement that PHAs inspect the units
PHAs would be required to inspect units within
federal housing quality standards prior to
prior to initial occupancy would be waived if the
60 days of the first payment made to the owner
occupancy and at least annually thereafter.
unit was previously occupied by a family with a
and again at least once every four years
PHAs can choose to use local, state, or federal
voucher and the unit had passed inspection
thereafter to ensure that they meet federal
housing quality standards (HQS), as long as state
within the prior year or if the unit had otherwise
housing quality standards or other standards
or local standards are as strict or stricter than
passed inspection in the prior year under any
approved by the Secretary. PHAs would be
federal standards. (42 USC 1437f(o)(8))
federal, state, or local program, and the PHA
required to inspect at least one-quarter of units
certifies that the standards used meet or exceed
each year. (Sec. 112)
HQS. If a unit fails inspection for non-life
threatening reasons, the PHA can make
payments for up to 30 days while the unit is
repaired. Thereafter, units are to be inspected
biennially and a PHA must inspect up to 50% of
units each year. (Sec. 2)
Portability
Families receiving voucher assistance, after one
No
change.
PHAs would be permitted to enter
into
year, can move to any jurisdiction in the country
agreements with other PHAs in the same state or
where a voucher program is being administered.
region to facilitate the ability of families who
(42 USC 1437f (o)(5))
have been receiving assistance for at least one
year to move to another jurisdiction within the
state or region. Families would only be able to
move across jurisdictions with preexisting
agreements. If the PHA wishes to establish a
region with more than one state, it would be
required to first notify HUD. (Sec. 113)

---

CRS-17
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Transition/
Not applicable.
Not applicable.
Families receiving homeownership assistance or
Grandfathering
project-based voucher assistance on the day
before enactment would continue to receive
(PH and PBRA)
assistance under current law for the length of
their contracts. (Sec. 104) Elderly and disabled
households receiving assistance on the day
before enactment would continue to be treated
under current law until January 2009. Elderly
and disabled households receiving assistance
after the date of enactment would also be treated
under current law until January 2009, unless their
PHA had devised a plan for meeting the needs of
the elderly and disabled prior to a January 2009
deadline for developing such a plan. (Sec. 105)
Funding Authorization
Funding for voucher renewals is permanently
The bill would replace the existing renewal
The Secretary would be required to establish a
and Allocation
authorized, subject to appropriations. Under
formula and authorize such sums as necessary to
formula, through negotiated rulemaking with
current law, subject to appropriations and
renew voucher contracts and provide tenant
stakeholders, within 24 months for allocating
beginning in FY1999, the Secretary is directed to
protection and enhanced vouchers through
funds to PHAs. In the interim, PHAs would
renew all expiring voucher contracts by applying
FY2011.
receive a proportionate share of funding based on
an inflation factor to an allocation baseline,
their prior year’s funding level. (Sec. 110)
adjusted for new authorized vouchers (including
Renewal funding would be allocated based on
tenant-protection vouchers). The baseline was
leasing and cost data from the previous year, plus
set at a level sufficient to continue assistance for
an annual adjustment factor with adjustments for
the actual number of families assisted as of
the first-time renewal of tenant-protection and
October 1, 1997. (42 USC 1437f(dd))
enhanced vouchers and with other adjustments as
necessary. Moving to Work (MTW) agencies
Beginning in FY2003, the appropriations law
would be funded pursuant to their agreements.

---

CRS-18
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
began to include instructions on how the
Leasing and cost data would be calculated no
Secretary was to distribute funds. In FY2004,
less than biennially by using the average for the
PHAs were funded based on the number of
most recent calendar year for which data are
vouchers they actually used as of their end of the
substantially verifiable and complete (including
year statement (with adjustments made for
vouchers set-aside for project-based assistance).
changes) and the cost of those vouchers (based
on their end of the year statement, not adjusted
If funding were insufficient to fully fund all PHA
for changes). In FY2005, PHAs were funded
budgets, then the Secretary would apply a pro-
based on their actual costs and number of
rata reduction to each agency’s budget (not
vouchers in use over a three-month period in
applicable to funding for enhanced/tenant
FY2004, pro-rated to fit within the amount
protection funds). On May 1 of each year, HUD
appropriated. In FY2006, PHAs received a pro-
would be required to recapture any amount over
rata share of the amount appropriated, based on
1/12 of the amount allocated to the agency for
what they received in FY2005.
the first year, leaving agencies with a one-month
program reserve. Of those recaptured funds, the
Prior to FY2005, agencies were provided a 12-
Secretary would first set aside amounts to
month program reserve. In FY2005,
reimburse agencies for increased portability and
appropriations law reduced agency reserves to
Family Self Sufficiency costs and reallocate the
one week. In FY2006, agencies are guaranteed
rest to agencies spending 99% of their funding
no minimum reserve.
but leased below their authorized level, although
the Secretary could prioritize PHAs that leased
less vouchers in the preceding year than in the
12-month period ending on April 1, 2004.
Reallocated amounts could be used to increase
leasing rates up to the authorized level.
At the last three months of each calendar year,
the Secretary could advance up to 2% of an
agency’s allocation to the agency to be used for
additional voucher costs (including temporary

---

CRS-19
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
over-leasing), at the agency’s request. PHAs
would be required to repay HUD through a
reduction in their subsequent allocation. (Sec. 7)
Administrative Fees
Prior to FY2004, administrative fees were paid
No change.
HUD would be required to develop a final
to PHAs on a per unit basis calculated roughly as
formula for allocating administrative fees within
a percentage of FMR. In recent years, under
24 months via negotiated rulemaking. In the
appropriations law, PHAs have received the
interim, PHAs would receive a pro-rata share of
same proportion of total funds that they had
the amount available for administrative fees,
received in the previous year. In FY2006, the
based on what they received in the previous year,
amount available for administrative fees was
although the Secretary would have the authority
equivalent to just under 9% of the amount
to retain up to 5% to provide special fees for
provided for vouchers. (42 USC 1437f(q))
non-routine expenses. (Sec. 117)
Grantee Performance
PHAs are evaluated annually through the Section
The Secretary would be required to establish
The Secretary would be required to establish
8 Management Assessment Protocol (SEMAP),
performance standards and a performance
performance standards and a performance
which is a set of 14 criteria established by HUD
assessment system.
assessment system. PHAs would be required to
via regulation, which primarily focus on agency
make annual reports to the Secretary and those
compliance with program rules and regulations
Agencies would be assessed on their
annual reports would be required to be made
rather than program goals or outcomes. Its 14
performance regarding:
publicly available on the Internet.
indicators include:
-quality of the dwelling units obtained using
-Proper selection of applicants from the housing
assistance;
If a PHA received a failing score, the Secretary
choice voucher waiting list,
-extent of utilization of assistance amount
would determine how best to administer the
-Sound determination of reasonable rent for each
provided to the agency;
grant, including:
unit leased,
-financial condition of the agency;
-turning over administration of the grant to
-Establishment of payment standards within the
-timeliness and accuracy of reporting by the
another PHA or other entity;
required range of the HUD fair market rent,
agency to the Secretary;
-appointing a receiver; or
-Accurate verification of family income,
-other areas the Secretary deems appropriate.
-setting a deadline for the PHA to improve.
-Timely annual reexaminations of family
(Sec. 106)
income,
Using these standards and procedures, the

---

CRS-20
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
-Correct calculation of the tenant share of the
Secretary would be required to conduct an
rent and the housing assistance payment,
assessment of the performance of each agency
-Maintenance of a current schedule of
and submit a report to Congress regarding the
allowances for tenant utility costs,
result of each assessment. (Sec. 10)
-Ensure units comply with the housing quality
standards before families enter into leases and
PHAs enter into housing assistance contracts,
-Timely annual housing quality inspections,
-Performance of quality control inspections to
ensure housing quality,
-Ensure that landlords and tenants promptly
correct housing quality deficiencies,
-Ensure that all available housing choice
vouchers are used,
-Expand housing choice outside areas of poverty
or minority concentration,
-Enroll families in the family self-sufficiency
(FSS) program as required and help FSS families
achieve increases in employment income.
If PHAs fail SEMAP, they can be deemed
“troubled.” Troubled agencies must agree to an
onsite assessment and a plan designed to bring
them into compliance. If the PHA is unwilling
or unable to abide by its plan to move to
compliance, the Secretary can:
-contract with another PHA or private manager
to administer the program;
-appoint a receiver;
-take over the administration of the program; or

---

CRS-21
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
-other actions the Secretary deems appropriate.
Deconcen-
PHAs are prohibited from concentrating very
No change.
Eliminates current provision.
tration
low-income families in public housing units in
requirement
certain public housing projects or certain
buildings within projects. The Secretary must
(Public Housing only)
review PHA compliance and PHAs must submit
an admissions policy designed to provide for
deconcentration of poverty and income mixing.
Moving to Work
Purposes
The purpose of the program is to provide PHAs
The purposes of the program would be to:
Same as H.R. 5443. (Sec. 302)
and the Secretary the flexibility to design and
-give incentives to families to become self-
test various approaches for providing and
sufficient;
administering housing assistance that:
-give PHAs and the Secretary the flexibility to
-reduce cost and achieve greater cost
develop approaches for providing and
effectiveness in federal expenditures;
administering housing assistance that achieves
-give incentives to families with children where
greater cost-effectiveness of federal
the head of the household is working, seeking
expenditures;
work, or preparing for work; and
-increase housing opportunities for low-income
-increase housing choices for low-income
families;
families. (42 USC 1437 Note)
-reduce administrative burdens on PHAs; and
-allow federal resources to be more effectively
utilized at the local level. (Sec. 6)

---

CRS-22
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Authority
Authorizes the Secretary to conduct an MTW
Would direct the Secretary to establish a Moving
Would direct the Secretary to establish a Moving
demonstration. The Secretary is permitted to
to Work program in which PHAs meeting the
to Work program in which PHAs meeting the
select up to 30 agencies for participation. (42
eligibility criteria can participate. Would limit
eligibility criteria can participate. No limit would
USC 1437 Note)
participation to no more than 40 agencies. (Sec.
be set on the number of agencies that can
6)
participate. (Sec. 302)
Use of Assistance
Participating PHAs may combine Public
No change. (Sec. 6)
No change. (Sec. 302)
Housing operating funds, Public Housing capital
funds, and Section 8 voucher funds to provide
housing assistance for low-income families and
services to facilitate the transition to work on
such terms and conditions as set by the PHA and
approved by the Secretary. (42 USC 1437f Note)
PHAs must continue to assist substantially the
PHAs would be required to continue to assist
There would be no requirement that PHAs
same total number of eligible low-income
substantially the same total number of eligible
continue to serve the same number of families.
families and maintain a comparable mix of
low-income families as if funds had not been
(Sec. 302)
families (by family size) as would have been
combined under the program. (Sec. 6)
served if the assistance had not been combined
under the demonstration. (42 USC 1437f Note)
Waiver Authority
The Secretary may waive provisions of the U.S.
The Secretary would be permitted to waive any
Same as H.R. 5443. (Sec. 302)
Housing Act of 1937, although Section 18
portion of the act with respect to assistance under
(demolition and disposition requirements) and
MTW, except Section 18. The Secretary would
Section 12 (Davis Bacon and community service
also be permitted to provide streamlined
requirements) cannot be waived. (42 USC 1437
procedures (including procurement procedures)
Note)
and provide for immediate implementation of
such procedures. (Sec. 6)

---

CRS-23
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Application, Selection
In selecting applicants, the Secretary must take
Agencies may submit applications to the
Agencies may submit applications to the
Criteria, and Eligibility
into account:
Secretary, in such a form prescribed by the
Secretary, in such a form prescribed by the
-the potential of the agency to plan and carry out
Secretary, if they are eligible.
Secretary, if they are eligible.
a program under the demonstration;
-the relative performance of the agency on the
In order to be eligible, agencies would have to:
In order to be eligible, agencies would be
Public Housing Assessment System; and
-be high performing agencies under applicable
required to:
-other appropriate factors set by the Secretary.
rating systems; and
-participate in the MTW demonstration at the
-manage at least 500 units of public housing or
time of application;
Agencies’ applications must:
manage at least 500 vouchers.
-be designated a high performing agency with
-request the authority to combine public housing
respect to the public housing and voucher
and Section 8 voucher funds;
In selecting agencies, the Secretary must
programs;
-be submitted after public hearings and citizen
consider the extent to which PHAs meet criteria
-manage at least 500 units of public housing;
participation; and
set by the Secretary, including:
-administer at least 500 vouchers; or
-include a plan, developed by the agency with
-demonstrated capacity to develop and manage a
-meet other criteria as set by the Secretary,
public and resident comments, that includes
successful program;
including:
criteria for:
-demonstrated compliance with statutes and
— demonstrated capacity to develop and
— families to be assisted, 75% of whom must
regulation applicable to HUD programs in which
manage a successful program;
be very low-income;
the agency participates or has participated;
— demonstrated compliance with statutes and
— reasonable rent policies designed to
-commitment of nonfederal resources (including
regulation applicable to HUD programs in which
encourage employment and self sufficiency;
in the local community); and
the agency participates or has participated;
— continuing to assist substantially the same
-demonstrated commitment by local government
— commitment of nonfederal resources
number of people;
to removing regulatory barriers to affordable
(including in the local community); and
— maintaining a comparable mix of families
housing. (Sec. 6)
— demonstrated commitment by local
(by family size); and
government to removing regulatory barriers to
— assuring housing meets quality standards.
affordable housing. (Sec. 302)
PHA applications may also request technical
assistance from HUD to assist with design of the
demonstration and participation in a detailed
evaluation. From FY1996-FY1998, the

---

CRS-24
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Secretary was authorized to use up to $5 million
for technical assistance to PHAs and to conduct
detailed evaluations. (42 USC 1437 Note)
Term of
No term specified in law; in practice, generally 5
PHAs would be permitted to participate for a
No term specified.
participation
to 7 year contracts, with extensions. (42 USC
three year term. Upon expiration, the agency
1437f Note)
could reapply for an additional three year period,
as long as the agency had not failed to comply
with performance standards. (Sec. 6)
Program
-75% of families assisted must be very low
As a condition of participation, PHAs would be
Same as H.R. 5443. (Sec. 302)
requirements
income;
required to:
-PHAs must establish reasonable rent policies
-consult with their communities;
designed to encourage employment and self
-target no less than 90% of assistance to families
sufficiency;
with gross income at or below 60% of median
-PHAs must continue to assist substantially the
income;
same number of people;
-establish reasonable rent policies designed to
-PHAs must maintain a comparable mix of
encourage employment and self sufficiency;
families (by family size); and
-provide assurance that housing meets HQS; and
-PHAs must assure housing meets quality
-provide other information as required by the
standards. (42 USC 1437f Note).
Secretary. (Sec. 6)
Evaluation,
The Secretary is to provide training and technical
Until January 1, 2008, the Secretary would be
Same as H.R. 5443, except H.R. 1999 does not
Assessment, and
assistance during the demonstration and conduct
permitted to use current public housing and
include language permitting the Secretary to
Performance
detailed evaluations of up to 15 agencies to
voucher assessment systems. Otherwise,
include a baseline performance level among the
Standards
identify replicable program models promoting
agencies would be evaluated under a system
performance standards set for MTW agencies.
the purpose of the demonstration.
designed by the Secretary.
(Sec. 302)
In making assessments, the Secretary must
The Secretary would be required to issue a

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CRS-25
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
consult with representatives of PHAs and
proposed and final rule to implement
residents. (42 USC 1437f Note)
performance standards for MTW agencies (the
final rule must be issued within 24 months of
enactment). They may include:
-A baseline performance level; and
-Standards for
— moving assisted low-income families to
economic self sufficiency,
— reducing per family costs of providing
housing assistance,
— expanding housing choice for low-income
families,
— improving program management, and
— increasing the number of homeownership
opportunities for low-income families; and
-other performance goals set by the Secretary.
(Sec. 6)
Record Keeping and
Agencies must keep records as required by the
Agencies would be required to keep records as
Agencies would be required to keep records as
Reports
Secretary. Agencies must supply reports and in
required by the Secretary, submit reports in such
required by the Secretary and submit reports in
a form and time set by the Secretary which:
a time and form as required by the Secretary and
such a time and form as required by the
-document use of funds,
submit annually such information to the
Secretary. The Secretary and GAO must have
-provide data requested by the Secretary for
Secretary as needed to evaluate the program.
full access to all pertinent documents. (Sec. 302)
assessing the demonstration, and
The Secretary and GAO must have full access to
-describe and analyze the effect of activities in
all pertinent documents.
meeting objectives.
The Secretary and the Government
The Secretary would be required to submit
Accountability Office (GAO) must have full
annual evaluations of PHAs to Congress,
access to all pertinent documents.
including finding and recommendations for
The Secretary has no later than 180 days after the
appropriate legislative action. GAO would also

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CRS-26
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
third year of the demonstration to submit to
be required to submit a report to Congress within
Congress a report evaluating programs carried
12 months on the extent to which participating
out under the demonstration, including findings
agencies are meeting the goals and purposes of
and recommendations for applicable legislative
the program. (Sec. 6)
changes. (42 USC 1437f Note)
(Report submitted in 2004)
Funding
The amount of assistance received by the agency
The amount of assistance received by a
Same as H.R. 5443. (Sec. 302)
is not diminished by their participation in the
participating agency, subject to appropriations
demonstration. MTW agencies are funded based
(and any applicable proration), would not be
on their agreements with HUD, although they are
affected by participation in the program. (Sec. 7)
subject to any funding prorations. (42 USC
1437f Note)
Transition
Not applicable.
Subject to procedures and requirements set by
Subject to procedures and requirements set by
the Secretary, PHAs under an existing MTW
the Secretary, PHAs participating in the MTW
contract on the date of enactment could apply for
demonstration could opt out and join the MTW
participation in the MTW program:
program. PHAs that would terminate their MTW
-at any time before the expiration of their
demonstration participation in 2005 or 2006
existing MTW contracts as long as they agree to
could renew their MTW demonstration
opt out of existing MTW contracts; or
agreements for another three year period and, at
-upon expiration of existing contracts.
the end of that three year period, apply for the
Upon application, agencies would be treated as
MTW program. (Sec. 302)
if they are reapplying under the new program.
The Secretary would be prohibited from
extending existing MTW contracts after
enactment. (Sec. 6)

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CRS-27
Feature
Housing Choice Voucher Program Current
Section 8 Voucher Reform Act of 2006
The State and Local Housing Flexibility Act
Law
(H.R. 5443)
of 2005
(United States Housing Act of 1937)
(H.R. 1999/S. 771)
Other Provisions
Manufactured Housing
Not applicable.
Would establish a pilot program to determine
No provision.
Pilot Program
whether restructured rent calculations for
manufactured housing assistance will increase
the affordability of manufactured housing. (Sec.
9)
PHA Reporting to
Not applicable.
Would authorize PHAs to report information on
No provision.
Credit Agencies
families’ rent payment histories to credit
reporting agencies. (Sec. 11)
Treatment of Basic
Not applicable.
Would require that federal housing programs
No provision.
Allowance for Housing
(excluding rental assistance programs) treat basic
Payments
allowance for housing funds in the same way
that Section 8 vouchers are treated for purposes
of eligibility. (Sec. 12)
w
g
p
h
p
s
cr
Source: Congressional Research Service analysis of current law (42 USC 1437 et. seq.); H.R. 1999/S. 771; and H.R. 5443 (109th Cong.).

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