Incentive Program for Landlords to Accept Section 8 Vouchers Explored

As a way to help end homelessness and a housing crisis where apartment vacancy rates remain low while rents continue to rise, the City of Long Beach is looking to roll out an incentive program aimed at encouraging more landlords to accept Section 8 or housing choice vouchers (HCVs).

The Long Beach City Council at its meeting on July 11 received a report from city staff on the effort brought forward by Vice Mayor Rex Richardson to develop an incentive package to urge more apartment owners to accept or at least consider tenants from the federal government-subsidized HCV program.

According to city staff, the incentive strategies, funded through Los Angeles County’s recently passed Measure H, could help prevent the city from losing millions of dollars in federal U.S. Department of Housing and Urban Development (HUD) funds for very low-income families, elderly and the disabled.

The incentive package would include three main components, including benefits for landlords and potential renters, said Alison Whyte King, bureau manager for the Long Beach Housing Authority, which administers the city’s housing program, in a presentation to the city council.

While the city has yet to confirm how much Long Beach will receive in funding from Measure H, the city plans to roll out the incentive program, similar to an initiative started by Los Angeles County’s housing authority, before December, she said.

The first component would include providing landlords with a “holding fee” to cover costs accrued while waiting for homeless individuals to be processed, King said. The city would also provide landlords with vacancy permits to hold units while the approval process is underway.

“We would provide [landlords] with a fee while we’re providing and referring homeless applicants,” she said. “It prevents the time generally [landlords] would have to wait for payment.”

King noted, however, that landlords would still be allowed to use their own discretion in vetting potential renters as they see fit, adding that there is no requirement landlords must select a tenant.

The second component would include creating a Damage Mitigation Fund, which would provide landlords with a “financial safety net” of up to $2,000 beyond the security deposit for costs of damage to the unit created in the first two years of occupancy, according to city staff.

The third component would provide potential renters or persons experiencing homelessness with “move-in assistance,” such as funds for the security deposit, turning on utilities and/or furniture essentials or appliances, King said.

In addition, city staff is considering streamlining the city-mandated proactive rental housing inspection program with HUD-mandated HCV inspections.

City staff also looked at an option to waive various city permits and inspection costs for apartment owners who accept housing vouchers. However, given the relatively small benefit to the property owner when compared to the overall impact on the efficacy of the inspection program, city staff has decided not to recommend such an incentive.

According to a city staff report, the incentive to cover $57.50 per unit as a base fee, considering four to 10-unit apartment buildings, would end up costing about $286,350, which is equivalent to three full-time city positions. Such a loss in revenue would have a “dramatic impact” on the city’s inspection program, city staff stated.

As for goals of the incentive program, King said the Housing Authority has requested funds to house up to 220 homeless persons in the first fiscal year and is expected to receive additional funds for subsequent fiscal years.

She said the Housing Authority has set aside non-federal funds to assist the first 75 clients who currently hold vouchers and have been searching for units for a significant time. Such clients, she said, don’t necessarily meet the HUD requirement for homelessness but would still have access to financial assistance through the Housing Authority.

The incentive package and reforms are a step forward in addressing the declining number of available units in the city that accept HCV holders, city staff confirmed, noting that recently more than 1,000 housing vouchers out of the city’s 7,398 allocations have gone unused due to a lack of available units.

If usage of allocated housing vouchers continues to decline or remain stagnant, millions of dollars in federal HUD funds the city receives annually may end up being threatened, city staff said.

Richardson, who spearheaded the effort as chairman of the Housing Authority, said he is pleased with the progress made so far on the incentive program that culminates coordination between landlords, property owners and renters.

“I like it because it addresses the folks activity searching for housing who are holding a voucher and also individuals who are facing homelessness and dealing with homelessness,” he said, adding that the city is also discussing ways to coordinate the Housing Authority with Long Beach Development Services to reduce the burden on landlords and tenants as well.

Johanna Cunningham, executive director of the Apartment Association, California Southern Cities, Inc., which represents apartment owners in the city, called the recommended incentive package a “good start,” adding that more work still needs to be done.

Josh Butler, executive director of affordable housing advocacy group Housing Long Beach, said Long Beach is currently experiencing a two percent vacancy rate for apartments and many landlords are unwilling to take in Section 8 tenants.

Although Long Beach has the largest renter population of any city on the West Coast, the city still has yet to enforce sufficient renter protections, he said, noting that not enough affordable housing is available for residents. Butler said landlords will likely “double dip” by continuing to increase rents while receiving government subsidies at the same time.

“You have a housing crisis here that requires real solutions,” he said. “You keep going to landlords for solutions to these problems, time after time….Yet they are not going to do it. They’re job here is to make as much money as possible.”

sean@beachcomber.news