Thousands of NYC residents may lose rent subsidies

August 9, 2010 by · Leave a Comment
Filed under: Real Estate News 

This is going to make living in one the nations most expensive cities even harder.  According to the NY Times, the housing department is facing a large $45 million short-fall in their budget.  This is more evidence of the hardships that have come on us since the housing crash.  It sent the economy into a tailspin and that has reduced tax receipts to the point where many of these entitlement benefits needs to be trimmed back to bring back balance to the city and state spending.

It is hard and certain hardship circumstances need to be addressed but over all, spending will need to be reduced across the board because they are based on tax dollars that were in a bubble environment.  The other option is higher taxes that will fall mostly on the wealthier class and that might need to be done, being that they got much benefit on the bubble and crash.  Either way, a policy needs to be made so we know what we are dealing with.  More to come.

NY Times – Linda Couch, the vice president for policy at the National Low Income Housing Coalition, said that given the recession, the drop in attrition rates should not have come as a surprise. In recent years, she added, the act of continuing to issue vouchers to the point at which authorities exceeded their federal cap for Section 8 units has become “a big no-no at HUD.”

Douglas Rice, a senior policy analyst at the Center on Budget and Policy Priorities in Washington, said the housing authority’s data showed that it “leased up very aggressively in the second half of last year.”

He added, “They should have realized they weren’t getting nearly enough renewal funds as they expected.”

Housing authorities across the country began learning in May that they would be receiving less federal money for Section 8 than they had expected. In many cases, the recession made existing vouchers more costly as incomes dropped, leading authorities to make up the difference.

Experts estimated that hundreds of agencies would have to reduce rental assistance or revoke vouchers. In the end, few housing authorities terminated vouchers; one small agency in Oregon cut 50 of them, with 15 of those families taken in by other public assistance programs.

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