Earlier this year I commented on a report from HUD’s Inspector General (the Department’s internal watchdog) which severely criticized HUD’s current policy which permits individuals who are designated as “over income” to remain in public housing.

Blog readers may recall that the report found that more than 25,000 residents made more than the maximum income allowed to qualify for public housing.  Now, while many of the “over income” residents exceeded the limit by a small amount, the audit revealed that nearly half were over the threshold by $10,000 to $70,000.  And what really drove the findings were that a few residents were glaringly over the limits:  such as a family of four in New York City with an income of just under $500,000 who is paying under $1,600 for a three-bedroom subsidized unit.

A Florida congressman remains unsatisfied with HUD’s response on this issue and is threatening to withhold $104 million from HUD’s annual budget.  Why $104 million?  Because that is the amount HUD’s inspector general reported is wasted on subsidizing “over income” residents taken from a sample of 15 local housing authorities.

After reversing course, HUD subsequently stated that local housing authorities can indeed move to evict “over income” residents.  But when the congressman checked with various housing authorities, he reported he was told that HUD would essentially not permit the evictions.  His solution?  Threaten to withhold federal funds.

Part of this, of course, is taxpayer money and how that money should be spent in an era of ever tighter federal budgets.  Fiscal watchdogs will assert that the rules need to be followed and if someone now earns more than the guidelines for public housing, he or she should be congratulated on their success and make plans to live elsewhere.  On the other side, public housing advocates will likely take the position that limited “income diversity” in affordable housing is a good thing and that it makes no sense to evict residents from their homes as that cuts against the very nature of why the federal housing programs exist in the first place.

I suspect this is an issue HUD does not enjoy being highlighted and I doubted HUD (through various Housing Authorities and private landlords) would actively start evicting residents.  I still think that will be the case, but let’s see what happens next.  $100 million is a big number and the administration will oppose such a cut.

Just A Thought.