Can universal rental vouchers help close the rental gap?
A new report calls for $3.2 billion investment for “universal” rental aid in Mass.
Rental assistance measures have been shown to alleviate poverty, reduce homelessness, and bring better health outcomes, as well as transform people’s lives. But, a new report shows that in Massachusetts the help available doesn’t get close to the amount residents need — with roughly 335,000 households in eligible income brackets left to fend for themselves.
The commonwealth actually created the first rental voucher system in the country five decades ago. The program, now called the Massachusetts Rental Voucher Program, is still the largest state-funded rental assistance program in the country.
It works in concert with a federal program, Section 8 or the Housing Choice Voucher program. The systems work differently, but the new report from Metro Housing Boston, the Citizens Housing and Planning Association, The Boston Foundation and a number of other housing groups says people can think of them as cousins.
The report estimates that about 585,000 households in the state meet the current criteria for state assistance with rent. About 250,000 are currently being helped by state and federal programs. That leaves about 335,000 qualifying households without assistance.
“With MRVP and Section 8, you can meet all the eligibility requirements and not even be allowed to join a wait list,” the report, issued Wednesday, reads. “Indeed, the regional MRVP wait lists have been closed since 2014. And in the brief window when they were open that year, one organization administering the program received 10,000 applications for 54 vouchers.”
So what is the solution? Well, the report proposes a universal approach to the Massachusetts Rental Voucher Program, or MRVP.
The report says that creating a universal assistance program would bring the benefits of MRVP to more people, increase housing stability and eliminate “the distortions and deep unfairness” present in the current system, among other benefits.
“Massachusetts has played this role before, having created the nation’s first rental assistance program—as well as the country’s first public school, the first freedom of information act, the first minimum wage, and the original framework for the Affordable Care Act,” the report reads. “Getting from today’s scarcity-afflicted MRVP to a truly universal model will be challenging, but with the right approach it could help revolutionize affordable housing policy for our residents and others throughout the country.”
What would universal vouchers look like?
Guaranteeing vouchers for those who qualify — meaning people who don’t own homes, lack meaningful savings, and earn less than 80% of the median family income in their area — would “dramatically ease the cost burden for renters of color, creating new opportunities to invest in other priorities like businesses or family needs,” the report says.
It is important to note, the report says, that eligibility thresholds vary greatly across the state and the program would funnel the highest level of assistance to those with the most precarious incomes.
The program would benefit a particularly large number of seniors, the report says, with half of the eligible one-person households being people over 60 years old.
Of course a program like this does come with a price tag. The report estimates that a universal assistance program could help 240,000 new households for an annual cost of $3.2 billion.
This is based on estimates of how many households are eligible (585,000), how many are already being served (250,000), an estimated enrollment rate (85%), average cost of vouchers, and administrative costs.
“A state investment of this size would make housing support a pillar of the state budget alongside core priorities like funding for public schools and health insurance for low-income residents,” the report reads. “Our estimate is also in line with other transformative proposals, like the push for universal pre-school, estimated to cost $5 billion per year.”
Such a program could come with savings in other areas, including emergency housing and homelessness assistance, the report said.
“Existing research is clear: Opening our current MRVP to all eligible residents would have a dramatic impact on the well-being of hundreds of thousands of households in Massachusetts, slashing the risk of homelessness, improving health outcomes, and creating space in family budgets to allow for more spending on education, quality food, and other family priorities,” the report said.
A “policy leap of this scale” would come with its own challenges and drawbacks. A sudden increase in the number of vouchers could drive up demand and housing prices by bringing more families into the housing market. It also would compete with Section 8, so any rollout would need to ensure that MRVP vouchers aren’t more desirable than federal vouchers.
The report suggests ways to alleviate the growing pains that could come with the change. First it suggests a phased approach to roll out over a decade or so. It also suggests addressing landlord discrimination, building new housing, and reorganizing and codifying MRVP.
“And while there’s no switch we can flip to open MRVP to all eligible households, there is a way to get from here to there—with lots of places to stop and confirm that we are avoiding unnecessary troubles and providing effective aid,” the report reads. “Fifty years ago, we were the first state to create a rental assistance program. Today, we can be the first state to make it work for all in need.”
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