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December 11, 2023
The Section 8 Project-Based Rental Assistance Program
The Section 8 Project-Based Rental Assistance (PBRA)
characteristics on their waiting lists. While the program
program subsidizes the rents of low-income individuals and
serves all types of families, owners may designate certain
families through rental assistance contracts between the
properties as available only for persons who are elderly or
Department of Housing and Urban Development (HUD)
have disabilities.
and private property owners. Named for Section 8 of the
Housing Act of 1937 (42 U.S.C. §1437f), it was created in
Property Characteristics
1974 and HUD actively entered into new contracts with
The PBRA program includes over 17,500 properties
owners through the early 1980s. Today, the program serves
comprising nearly 1.3 million assisted units. More than a
roughly 1 million households. This number has been
third (37%) were built before 1980 and 84% were built
growing—following a long period of decline as old
before 1990. The vast majority of assisted units (86%) and
contracts ended—since the 2012 Rental Assistance
properties (76%) are located in metro areas (as opposed to
Demonstration (RAD) authorized public housing and other
non-metro areas).
HUD-assisted properties to convert to the PBRA program.
Household Characteristics
Program Administration and Basics
The PBRA program serves all types of households, ranging
The Section 8 PBRA program features rental assistance
from single adults to families with children. Waiting list
contracts between private owners (for-profit and nonprofit)
preferences and property designations set by owners can
and HUD. Under the terms of those contracts, owners agree
affect the characteristics of their residents. As shown in
to manage their assisted units subject to federal rules—
Figure 1, in 2023 roughly 35% of PBRA households
including periodic physical quality inspection—and HUD
include children; 65% are households without children. Of
agrees to pay subsidies to make up the difference between
the latter, the majority are headed by persons age 62 or
the low, income-based rents charged to tenants and
older.
previously agreed upon contract rents. PBRA contracts
typically have 20-year terms and they may be renewed.
Figure 1. Head of Household Characteristics, 2023
In order to be eligible to live in PBRA housing, individuals
and families (hereinafter, households) generally must be
very low-income (income at or below 50% of local Area
Median Income [AMI]), although in some cases, families
may be low-income (income at or below 80% of AMI). At
least 40% of units made available each year must be
occupied by families who are extremely low-income
(income at or below the greater of 30% of AMI or the
federal poverty guidelines). Households that wish to live in
a PBRA unit apply directly to the property. In addition to
evaluating tenant income eligibility, owners may adopt
Source: Prepared by CRS based on Tenant Rental Assistance
additional discretionary screening criteria related to, for
Certification System (TRACS) data, June 30, 2023, published by HUD,
example, criminal background, credit, or rental history.
https://www.hud.gov/sites/dfiles/Housing/documents/
Tenant_Characteristics_Rpt06302023.pdf.
Households who live in PBRA properties pay the greater of
30% of their adjusted incomes or 10% of their gross
Funding
incomes towards their rent and utilities. If a tenant’s income
The Section 8 PBRA program is primarily funded via
increases to the point that they no longer qualify for a
annual discretionary appropriations provided to the project-
subsidy, they may generally pay market rent to remain in
based rental assistance account. (A shrinking number of
their unit. There is no time limit on assistance, but tenants
contracts are supported with funding from prior years.) That
may be evicted for lease violations. If an owner chooses not
account funds the monthly rental subsidies paid to owners
to renew an expiring PBRA contract with HUD, or if HUD
as well as the administrative fees paid to performance-based
terminates the contract for cause, tenants receive Housing
contract administrators (PBCAs) contracted by HUD.
Choice Vouchers that may allow them to stay in the unit or
Additionally, Section 514 of the Multifamily Assisted
move to another property.
Housing Reform and Affordability Act of 1997
(MAHRAA) authorizes HUD to set aside and spend up to
Demand for PBRA housing generally exceeds the supply,
$10 million annually from the PBRA account for tenant
so there are waiting lists to live in most properties. Owners
organizing, training, and capacity-building activities,
may set preferences for applicants with certain
https://crsreports.congress.gov
The Section 8 Project-Based Rental Assistance Program
although HUD does not utilize this set-aside or issue grants
In response to concerns raised by some in Congress, the
for this purpose every year.
HUD Office of Inspector General (OIG), and the
Government Accountability Office (GAO), HUD
Table 1. PBRA Appropriations, FY2019-FY2023
implemented a new inspection protocol applicable to most
(nominal dol ars in bil ions)
HUD-assisted properties. The National Standards for the
Physical Inspection of Real Estate (NSPIRE) protocol took
FY2019 FY2020 FY2021 FY2022
FY2023
Change
effect for PBRA properties in October 2023. HUD
developed NSPIRE through a multiyear process to increase
$11.75
$12.57
$13.47
$13.94
$14.91
+27%
the focus of physical inspections on health and safety and
Source: Table prepared by CRS. Figures do not include COVID-19
create more consistency across programs.
emergency supplemental appropriations but do include emergency
funding for regular program operations provided in FY2023.
PBCA Contracts: Since the early 2000s, HUD has
contracted with public housing authorities—primarily state
Cost growth in the program is driven by several factors.
housing finance agencies—as performance-based contract
One is increases in the rent paid to property owners. PBRA
administrators (PBCAs) to assist in managing PBRA
contracts specify how rents will be annually adjusted to
contracts. In 2008, in response to several OIG reports
reflect inflation or budget needs. As rental inflation and/or
critical of the cost and efficacy of the PBCA initiative,
budgetary needs increase, especially if they increase faster
HUD announced its intention to rebid the contracts. HUD
than tenant incomes, the subsidy cost of each unit increases.
made its first selection of new PBCAs in 2011, but
Another factor in the cost growth in the program is an
withdrew most of those contracts in response to bid
increase in the number of units. Even though HUD has
protests. HUD initiated another solicitation in 2012, issuing
generally not had authority to enter into new PBRA
a Notice of Funding Availability to award PBCA
contracts since the mid-1980s, in recent years the number of
cooperative agreements. That action was also challenged,
PBRA contracts has been increasing. This growth is
ultimately resulting in a 2015 opinion by the U.S. Court of
attributable to RAD, a program created in FY2012 that
Appeals for the Federal Circuit holding that PBCAs are
allows certain public housing and other federally assisted
procurement contracts that must be solicited and awarded in
housing developments to convert their federal assistance to
accordance with federal acquisition laws.
Section 8 PBRA contracts (or Section 8 project-based
HUD has appealed to Congress for statutory authorization
vouchers). While RAD conversions are cost neutral in the
to use cooperative agreements to award PBCA contracts in
first year—meaning the funding for the contracts is
lieu of the federal procurement process. In the absence of
transferred to the PBRA account from the account that
such an authorization, HUD has issued several draft
previously funded the assistance—after, the annual costs of
procurement solicitations since 2017; HUD withdrew the
RAD PBRA contracts are funded by the PBRA account.
first in response to stakeholder concerns and was blocked
Issues and Recent Developments
from implementing the second by a directive in the FY2023
appropriations law. The current PBCAs are continuing
Preservation: As the stock of PBRA-assisted housing has
under contract extensions until HUD awards new contracts.
aged, and as original contracts have come up for renewal,
some observers have raised concerns about how best to
HOTMA Implementation: The Housing Opportunity
preserve the properties as affordable housing for current
Through Modernization Act of 2016 (HOTMA; P.L. 114-
and future residents. Assisted housing preservation
201) made changes to how income and rents are calculated
legislation was enacted throughout the 1990s, giving HUD
in the PBRA and other rental assistance programs. These
tools to incentivize owners to renew their PBRA contracts
included increases to some deductions from income,
and recapitalize their properties, as well as to assist tenants
decreases to other income deductions, and streamlining the
facing displacement when contracts end.
calculation of income from assets, among other changes. In
While these tools have allowed for the preservation of a
February 2023, HUD published a final rule to implement
number of properties, they have limited reach in some
the remaining HOTMA changes; most of the changes
circumstances, such as when an owner has a strong market-
affecting income and rent were supposed to take effect in
based financial incentive to sell their property or convert it
January 2024 but have since been delayed to January 2025.
to market rate rents; or when the property has fallen into
such a state of disrepair that HUD’s only recourse is to
IRA Funding: P.L. 117-169, commonly known as the
terminate the contract.
Inflation Reduction Act (IRA), included $1 billion for a
Green and Resilient Retrofit Program (GRRP) modeled
Physical Quality and Inspections: Most PBRA-assisted
after a similar program that was funded in the American
properties were built in the 1970s and 1980s, and as they
Recovery and Reinvestment Act of 2009 (P.L. 111-5).
have aged, some observers have raised concerns about their
HUD is to use the funds to award grants and loans for
physical quality and safety. Congress has held a number of
utility efficiency, carbon emission reduction, and climate
hearings on the topic and included in HUD’s annual
resiliency upgrades at HUD-assisted multifamily properties,
appropriations additional tools the agency can use to
including PBRA properties. HUD is accepting applications
address properties with failing inspection scores and
on a rolling basis through mid-2024. PBRA properties may
requirements for the agency to take action to address such
also be eligible for assistance from other tax credit and
properties.
grant programs created by the IRA, including the Homes
Energy Rebate programs administered by the Department
of Energy.
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The Section 8 Project-Based Rental Assistance Program
IF12545
Maggie McCarty, Specialist in Housing Policy
Disclaimer
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https://crsreports.congress.gov | IF12545 · VERSION 1 · NEW