New Rules Stop Wealthy From Getting Taxpayer Subsidized Housing
Audit Shocker: Tenant Worth $1.6 Million On Public Housing
WASHINGTON – February 4, 2016 – (RealEstateRama) — The U.S. House today passed an amendment introduced by Rep. Vern Buchanan (R-FL) that will tighten income and asset verification requirements for public housing after an audit revealed that 25,000 families earned too much to qualify for these subsidies.
Buchanan’s amendment to H.R. 3700, the Housing Opportunity Through Modernization Act, passed by voice vote. H.R. 3700 is expected to pass the House later today and then go to the Senate for consideration.
According to an audit last year by the Inspector General of the Department of Housing and Urban Development (HUD), a Nebraska tenant was approved to live in subsidized housing for 10 years with a monthly rent of just $300, despite having an annual income of $65,007, assets valued at $1.6 million, and savings, checking and retirement accounts each holding hundreds of thousands of dollars.
The audit found that the federal government gave tax-subsidized, low-income housing to thousands of families who didn’t qualify while hundreds of thousands of needy families were left on waiting lists.
The investigation found almost half of the families identified earned at least $10,000 more than HUD’s 2014 income limit.
“It is outrageous that taxpayers are footing the bill for millionaires’ housing,” said Buchanan. “This type of abuse hurts truly needy families and erodes faith in government. Holding HUD to the same standards used for other federal benefits will provide much-needed oversight on taxpayer funds and help create consistency across the vast array of assistance programs.”
Specifically, the amendment will require HUD to establish the means for public housing agencies (PHAs) and landlords to use existing databases to verify the income and assets of individuals receiving public housing benefits. Under current law, local PHAs and landlords rely on tenants self-reporting this information, which is time consuming to collect and verify. Buchanan’s amendment will reduce the burden on families, improve the administrative efficiency for PHAs and landlords, and minimize the risk of waste, fraud, and abuse so limited resources are better targeted to families in need.
