1. Rent Reform – Part 1

2. Boulder Housing Partners Rent Reform
2017 MTW Conference

3. Community Overview Boulder, Colorado Boulder Housing Partners
Population: 100,000
25 square miles
Median income: $94,800
Average vacancy: 6.4%
2 bedroom FMR: $1,240
2 bedroom PS: $1,364
Boulder Housing Partners
Vouchers: 1,144
MTW: 756
RAD: 135
NED: 181
Mainstream: 50
Housing First: 22
Units: 1,105
Public Housing: 49
Project Based Rental Contracts: 116
Tax Credit: 596
Affordable: 205
Market: 139

4. Rent reform model – Flat tier rent
Family size + gross income = income tier
Income tier + bedroom size = total tenant payment
TTP
– utility allowance
+ mixed eligible family member fee
+ amount gross rent > payment standard
= tenant rent

5. Annual income calculation
Current stable income moving forward
Example, employed at ABC Co. making $10 an hour working 40 hours on average
Annual income = $20,800 OR
If seasonal or not employed, use past two-year history shown on EIV, the Work Number, W-2s, etc.
Example, currently reporting zero income but EIV shows wage income for 6 of last 8 quarters, take average per 6 quarters and project that forward

6. Frequency of recert Recertify every two years
No interim recerts for income increases (unless reported income is in tier 1)
Interim recerts for income loss only in extenuating circumstances

7. Why did we chose this rent reform?
Guiding Principles - Flat tiered rent based on bedroom size
Incentivizes work
Yes
Simulates the market
Simple and predictable for residents
Serves the same population
Simple to administer
Rent has a relationship to income
No major increases to rent burden
Hardship policy: 7% cap
No major cost increases to BHP

8. Income chart Income Tier Family Size 1 2 3 4 5 6 7 8 9 10 $ - - 4,000$ -
4,000
4,200
4,400
4,600
4,800
5,000
5,400
6,000
6,400
6,800
5,500
5,700
6,700
7,300
7,900
8,400
8,900
9,500
10,100
7,200
8,300
9,300
10,400
11,300
12,200
13,000
13,900
14,800
15,700
10,900
12,400
14,000
15,500
16,800
18,000
19,200
20,500
21,800
23,200
14,100
16,100
18,100
20,100
21,700
23,300
24,900
26,500
28,100
29,800
17,300
19,700
22,200
24,700
26,700
28,600
30,600
32,600
34,600
36,700
23,400
26,300
29,200
31,600
33,900
36,300
38,600
41,000
43,500
23,700
27,100
30,500
33,800
36,600
39,200
41,900
44,700
47,400
50,300
26,900
30,700
38,400
41,500
44,600
47,600
50,700
53,800
57,100 11
30,285
34,605
38,925
43,245
46,710
50,175
53,640
57,105
60,531
64,163 12
33,650
38,450
43,250
48,050
51,900
55,750
59,600
63,450
67,257
71,292 13
40,380
46,140
57,660
62,280
66,900
71,520
76,140
80,708
85,551 14
47,110
53,830
60,550
67,270
72,660
78,050
83,440
88,830
94,160
99,809 15
53,840
61,520
69,200
76,880
83,040
89,200
95,360
101,520
107,611
114,068

9. HCV Flat Tier Rent Chart
2016
HCV Flat Tier Rent Chart
Income Tier
Bedrooms 1 2 3 4 5 6
$120
120
125
130
140
160
180
135
150
170
210
235
270
165
185
205
225
305
345
240
275
340
400
450
510
330
380
420
475
535
605
685
410
525
590
670
760
860 7
500
565
630
710
815
920
1,040 8
580
560
735
840
945
065
1200 9
660
765
865
960
1105
1245
1405 10
820
880
1125
1175
1260
1425
1605 11
1190
1445
1575
1785 12
970
1115
1250
1495
1630
1825
2070 13
1150
1315
1475
1995
2195
2310 14
1325
1510
1705
1895
2165
2490
2625 15
1500
1715
1930
2140
2830
2865

10. Hardships Upon transition: After transition:
1. Maximum rent increase capped at 7% (if all other factors stay the same)
2. Minimum rent increase – grandfathered in for 12-months, given advance notice, then rent increased
After transition:
Elimination of interim decreases – Safety Net Referral Program

11. Implementation challenges
Mass recerts every year –
Voucher holders split into two groups (PBV vs. TBV) to spread the work
Simple to administer –
Yardi set up
Re-training of staff
Hardships
Updating charts
Plan ahead for how and when the charts will be updated

12. 2016 results
Most surprising result: 26% increase in average income 32% average rent burden - rent reform decreases disincentive? - economic upturn? - others? - all of the above?

13. 2016 282 total families were recertified
26 reported zero income – but had income attributed to them based on past history
Average income of these families - $20,000
27 families had income increases that put them at zero HAP
2 voluntarily gave up the voucher

14. 2016 No interim recertification: 50 requests for an interim
9 were approved and interim processed
41 were denied
17 referred to Safety Net Program
10 contacted the program and received assistance
Total assistance paid $7,576

15. Rent control study - Required as part of application to MTW Program
- Must create our own
- Partnered with the University of Colorado - Boulder
- Too small to have a control and treatment group in one population
- Approved to do a Time 1 v. Time 2 study for work-able families
- Two groups (Public Housing and Housing Choice Vouchers)

16. Rent control study - Survey is part of biennial recert packet
- Tracks families in 10 domains of self-sufficiency:
Housing
Employment
Income
Food
Transportation
Child Care
Support Networks
Legal Matters
Health
Education
Ratings are:
1 – Urgent situation, currently in crisis
2 – Vulnerable, need support to move forward
3 – Safe, family is making progress toward stability
4 – Stable, family is stable, safe and moving towards thriving
5 – Thriving, family is self-sufficient and thriving

17. Rent control study - 2014 – gathered baseline data
second survey for PH
Few changes were noted
second survey for HCVP
Some changes were noted
Study will be longitudinal
Results are being used to direct services to areas where needed

18. Louisville Rent Reform Demonstration
2017 MTW Conference
Louisville Rent Reform Demonstration

19. Community Overview Louisville, Kentucky – MTW Vouchers 8,822
Population: 755,809
398 square miles
Median income: $48,695
Rental vacancy: 7.2%
2 bedroom FMR: $793
MTW Vouchers
8,822
Other Vouchers (VASH,TPV)
404
Public Housing
4,453
Tax Credit Only 75
Market Rate 84
Affordable Homeownership* 83
Serve more than 13,000 families.
Our rental market is not as tight as those of many other MTW PHAs, but it is tightening.
*Management of affordable condominiums developed by LMHA subsidiary.

20. What is the rent reform demonstration?
HUD-commissioned study to evaluate an alternative rent policy across multiple MTW agencies:
Lexington
Louisville
San Antonio
Washington, DC
Study is being coordinated by MDRC (a non-profit & non-partisan education & social policy research organization)
Randomized study with both a Control Group & an Alternative Rent Group
Focuses on work-able families

21. Objectives
Create a stronger financial incentive for tenants to work and advance toward self-sufficiency
Simply the administration of the HCV Program
Reduce housing agency administrative burdens and costs
Improve accuracy and compliance of Program administration
Remain cost neutral or generate savings in HAP expenditures relative to expenditures under current rules
Improve transparency of program requirements

22. Target population Study focuses on work-able households
Excluded populations:
FSS participants
Families in HCV Homeownership Program
Families receiving childcare allowance
Families using “program-based” vouchers
(typically serve vulnerable populations)
Families receiving non-MTW vouchers (VASH, TPV)
Families that would meet elderly definition within 6 years
(during the course of the study)
Disabled families
Households with mixed immigration status

23. Alternative Rent Group
Policy Changes
Control Group
Alternative Rent Group
Calculating Income
Expected income over next 12 months
Deductions per regulation, except standard medical deduction & no EID.
Assets ignored if total value < $5,000
Retrospective income over past 12 months
Except, if current/anticipated income is less than retrospective income by >10%, a 6-month grace period will be granted before TTP is automatically increased.
No deductions
Assets ignored if total value <$25,000
TTP
30% of adjusted annual income
No minimum rent
28% of gross annual income
$50 minimum rent
Maximum Initial Rent Burden
40% of adjusted annual income
40% of gross annual income
Payment of Rent
HH pays directly to owner: TTP less Utility allowance
If this value is less than $50, HH pays $50 to owner, & LMHA reimburses HH balance of utility allowance
Interims for loss of household member (in case of no voucher size change). If retrospective gross income decreases by at least 10%, then TTP is reset.
Interims for change in HH composition or move to new unit do not count toward 1 interim per year limit.
Utility allowances changed for:
Change to contract rent
TTP is recalculated
Move to new unit
Change to HH composition requiring change to voucher size

24. Alternative Rent Group
Policy Changes
Control Group
Alternative Rent Group
Utility Allowance
4 housing types
9 utility categories + Other
Natural gas/bottle gas/electric/oil categories
Adjusted at recertification
Only 2 housing types: home/new mobile home & other
Only 5 categories: heat, hot water, water/sewer, range/microwave, & refrigerator
Source categories ignored for home/new mobile home & condensed to 2 categories for other housing type
Adjusted only when HAP or TTP is recalculated for other reasons
Recertifications
Scheduled recertification annually
Interim permitted for any decrease in income
For all interims (regardless of cause), all income sources are re-verified
Scheduled recertification every 3 years
Interim for income decrease only if retrospective gross income decreases by >10%. Limited to 1 per year.
For interim for HH composition change or move to new unit, income is reviewed/verified only if income decreases by >10% or voucher size changes. This type of interim does not count toward interim limit.
Hardship Policy
N/A (no minimum rent, so not necessary)
TTP can be lowered or waived for up to 180 days.
No limit on number of hardship waivers that can be requested during study period.
Interims for loss of household member (in case of no voucher size change). If retrospective gross income decreases by at least 10%, then TTP is reset.
Interims for change in HH composition or move to new unit do not count toward 1 interim per year limit.
Utility allowances changed for:
Change to contract rent
TTP is recalculated
Move to new unit
Change to HH composition requiring change to voucher size

25. Community Concerns & Response
Mandatory enrollment
30-day opt-out provision
Individual family data will be shared with external researchers
Families can elect to have their data shared only in the aggregate
Working families would no longer receive childcare deduction
Families receiving childcare deduction were removed from eligible population
$100 minimum rent
Lowered to $75 then to $50
(Can be eliminated by hardship waiver)
Hardship policy: Hardship process may take too long in the case of a family that has been served a 7-day eviction notice or notice of utilities shut-off for non-payment
Upon submission of notice to Housing Specialist, TTP is immediately waived. If family cannot produce waiver, LMHA will request from owner within 1 business day. If necessary, a manual check paying balance of HAP will be issued to owner.
Input received from:
Local university
Faith community
Local advocacy groups (housing & other social justice issues)
Legal Aid Society

26. Hardship Policy Hardship Waiver Criteria:
Hardship cannot be remedied through the one interim recertification allowed each year
TTP exceeds 40% of current monthly gross income (discounting any amount over payment standard)
Household faces risk of eviction for non-payment of rent or utility bills
Other circumstances, as determined by LMHA
Hardship Waiver Process (Non-Expedited)
Family submits written request and related documentation to Housing Specialist
Households claiming $0 income must provide detailed accounting of funds used to cover basic costs of living
Housing Specialist approves or denies request
If request is denied, tenant may request informal hearing through LMHA’s normal grievance policy
Hardship Remedies
TTP can be either lowered or waived for up to 180 days.
There is no limitation on the number of hardship waivers a family may request.

27. Demonstration Enrollment
Computer program randomly selected Control Group & Alternative Rent Group households from eligible population
At time of regularly scheduled re-certification, families met with Housing Specialist to review Study parameters & had TTP calculated under both the control & alternate rent policies
Households had 30 days to opt-out
Final Enrollment
(Completed December 2015)
1,037 Control Group
Alternative Rent Group
Opt-Outs

28. Implementation challenges
Initial certifications required significant extra time
Staff explained study, and tenant watched video produced by MDRC
Staff calculated TTP under both traditional and alternative rules
Tenant filled out baseline information form
Consistent tracking of new data fields like “Employment Status”
LMHA is responsible for tracking HUD standard metrics. Baselines, benchmarks, & outcomes may not align with MDRC-reported study results.
MDRC is only tracking directional changes. LMHA must track numerical benchmarks & outcomes.
MDRC is not reporting any results until the end of study year 2. LMHA has already reported metrics for FY 2016, roughly 6 months after study enrollment ended.

29. existing HCV rent reform Activities
HCV Program
Landlords can only increase Rent to Owner by 2% each year
Elimination of standard earned income disregard; instead have permanent $7,500 earned income disregard for elderly families
Deduction of childcare expenses before determining HCV Program eligibility
Alternate year recertifications for elderly and disabled families
Standard medical deduction ($1,600)
Homeownership Program
- Exception payment standard census tracts (120% of FMR)
- Use of 2-BR payment standard for 1-BR eligible families
Rent to Owner. The total monthly rent payable to the Owner under the Lease for the unit. Rent to Owner covers payment for any housing services, maintenance, and utilities that the Owner is required to provide and pay for. (24 CFR 982.4)
Deduction of Childcare Expenses: Head, co-head, or spouse must have 12-month, uninterrupted work history.
HO Exception Areas: CT’s where “Owner Occupied Median Value” is greater than 80% of the “Owner Occupied Median Value” for the MSA. Use most recent 5-year American Community Survey estimates. Median owner-occupied home price in Louisville MSA is $148,900 (2015 ACS). So in exception payment standard census tracts, the median home value is at least $119,120. Just increased in FY 2017; used to be at least 100% of median value.