Tag Archives: policy

A bold new federal experiment in giving renters cash

Originally published at Vox on September 12, 2023.
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A group of researchers at the Department of Housing and Urban Development have been quietly developing an idea that could fundamentally upend the nearly 50-year-old housing voucher program, which helps more than 2 million low-income families afford apartments in the private rental market every year.

The idea is relatively simple: What if, instead of traditional housing vouchers laden with convoluted red tape that landlords notoriously hate, low-income tenants could pay their rent with cash? Would that make it easier for tenants to find housing or move into better neighborhoods? Could that even save the government money by streamlining the aid?

Right now, due to funding constraints, only a quarter of those eligible for housing choice vouchers (formerly known as Section 8 vouchers) ever receive one. But if you are in that lucky 25 percent and are awarded a voucher, you might not be able to use it. The program is so cumbersome that only around 60 percent of beneficiaries can find a landlord willing to rent to them.

This isn’t the first time the federal government has explored questions around cash rental assistance: In the early 1970s, Congress successfully piloted a program to 14,000 families across 12 cities. That research, however, was largely forgotten about in the following decades. It wasn’t until recently, when some HUD employees stumbled upon old reports buried on an agency bookshelf, that policymakers realized the cash rental assistance model might be more valuable for modern times.

They are building on that older research as well as more recent developments: an ongoing related study in Philadelphia, the Covid-19 experiments with new kinds of cash assistance (including not just housing aid but also stimulus checks, child tax credits, and food subsidies), and dozens of encouraging guaranteed income pilots that have cropped up over the last few years. HUD officials now say it’s time to give federal cash aid a closer look.

The leaders behind this effort held their first official meetings last week, pitching philanthropic groups on the idea and asking for their financial backing. While the two virtual sessions were closed to the press, a HUD official told me “30 to 40 interested funders” came to their Tuesday pitch, and “dozens more” to their Thursday one. The team is convening a third meeting with nonprofits and housing researchers on September 19.

Though the HUD appointees who led the meetings — Brian McCabe and Aaron Shroyer — are framing the idea as a modest research project, officials involved are clear-eyed on where such a study could ultimately go. If, for example, a rigorously designed experiment provides new evidence for changing how vouchers are administered, that could have major implications for the $30 billion annual program and all the low-income families it serves. A small pilot could lead to a larger demonstration study, which could, officials say, then lead to pitching Congress on permanent change.

The wheels of federal policy reform move slowly: It might be 10 years until HUD makes any sort of long-term ask of Congress. But the wheels are turning now, in a way they never have before, to make the idea of cash aid a reality.

How the cash rental assistance policy might work

There are a lot of steps to getting housing with a federal voucher. First, a household has to prove eligibility. Then a public housing agency must issue the voucher subsidy to a landlord on the household’s behalf. For the household to benefit, the landlord must accept that voucher, the unit must pass an inspection, and the landlord must sign a contract with the public housing agency.

These are a lot of steps, and one hope is that by cutting out much of this bureaucracy, more people will be able to quickly move into affordable housing.

The proposed HUD study would look like this: Households selected from existing voucher waiting lists across a handful of diverse cities (ranging from smaller and suburban to dense and urban) would be randomly assigned to receive either the traditional housing choice voucher funded by HUD or a monthly payment for an equivalent value funded by philanthropy. The cash would not be unrestricted; it would need to go toward paying rent.

Researchers would then be able to study and compare the two groups over time (HUD says ideally for four years) to assess key housing policy questions, like whether one group had more success landing an apartment and staying in their unit.

A HUD official, who was not authorized to speak publicly, said they don’t have an exact number of tenant participants in mind, but stressed they’d want to involve researchers from the very beginning so they could design a study capable of providing strong statistical analysis. An example they put forward was studying five cities, with 200 households per city.

Landlords would likely still know if renters were using philanthropic cash to pay their rent, as it’s common to ask prospective tenants for income verification. But this kind of study could help clarify whether landlords are more biased against renting to low-income people who rely on aid at all, or if landlord resistance stems primarily from the logistical hassle of the traditional voucher program.

“The idea — to the degree possible — is to make the [public housing agency] invisible,” explained the HUD official. “So a landlord knows they’re dealing directly with the tenant, and not the tenant and the PHA.”

Jack Landry, who researches guaranteed income programs for the left-leaning Jain Family Institute, said he’s excited about HUD’s proposed idea because it offers something distinct from the rest of the existing evidence base.

“There are a lot of UBI [universal basic income] pilots out there, but only a fraction of them are being rigorously studied, and a lot of them are funded by American Rescue Plan dollars, making it unclear what happens when the money runs out,” he told Vox. “I’m enthusiastic because I think HUD’s idea has really clear policy implications and a fairly clear route to translating to large-scale policy change.”

Congress won’t let HUD distribute cash directly — but philanthropists could step in

Todd Richardson, a longtime HUD staffer whose team inadvertently discovered old federal reports of the cash rental aid program that ran in the 1970s, proposed in a little-noticed blog post in 2017 that perhaps those research findings could inform an existing voucher program known as Moving to Work.

Moving to Work, which allows public housing agencies to spend federal housing funds more flexibly than is permitted under the traditional voucher program, has been around since 1996 but was expanded by Congress in 2016.

Two years ago, in a meeting attended by local and federal housing officials and this reporter, participants discussed the idea of using Moving to Work to test cash subsidies for renters. Attendees expressed enthusiasm for the idea, though Richardson, who was leading the meeting, warned that it might not “pass muster” with the agency’s legal department.

The reason HUD is now pursuing a partnership with philanthropy is HUD’s lawyers ultimately determined it would violate existing congressional law to distribute federal housing dollars as cash, even under the Moving to Work program. Though some renters accessed federal cash rental assistance during the pandemic, officials say that’s largely because the American Rescue Plan was more vague on how funds could be spent, and thus more flexible.

But if HUD isn’t allowed to distribute its vouchers as cash, foundations could step in, and then HUD could study how that goes.

This public-private idea is being tried already in one city: In Philadelphia, researchers are almost one year into a two-and-a-half-year cash rental assistance experiment studying 300 households selected to receive money on a prepaid debit card every month. HUD officials have been in touch with Philadelphia program leaders, but they envision designing their federal study differently, partly because state and local housing agencies have more flexibility on how they spend public funds.

Sara Jaffee, a University of Pennsylvania researcher involved in evaluating Philadelphia’s cash rental assistance program, told Vox they’re just finishing cleaning up data and should be able to share some initial findings within the next month. She said they’re testing a lot of questions related to housing outcomes, including around housing quality and the experience of leasing with landlords.

According to a HUD official involved, the federal demonstration could conceivably get off the ground in the next six to nine months, depending on how fast governments find charitable partners. They’re hoping they can entice local philanthropies interested in putting money back into their communities — like the Pennyslvania-based foundations that are supporting Philadelphia’s study — as well as national tech and progressive groups that might want to grow the evidence base for universal basic income.

Last week’s meetings marked only the first step to potentially changing how billions of dollars in housing aid to low-income renters are spent. But as far as first steps in federal policymaking go, they were serious ones.

Obama’s Mixed Record on School Integration

Originally published in The American Prospect on August 31, 2015.
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As Congress debates competing revisions of the No Child Left Behind Act over the next several weeks, lawmakers are unlikely to spend much time looking at the growing problem of segregated schools. Despite strong academic and civic benefits associated with integrated schooling, and a unanimous Supreme Court decision which ruled that “separate educational facilities are inherently unequal”—American public schools have resegregated quickly by race and class over the past two-and-a-half decades.

Many advocates had hoped to see the Obama administration take steps to address rising school segregation, but so far its record has not been great. While the Department of Education has paid lip service to the need to promote integrated schools, and has included modest diversity incentives within a handful of federal grants, it refused to use larger education initiatives like Race to the Top to encourage states and districts to prioritize school diversity. In some cases, the department actually pushed policies that made segregation worse.

The Obama administration came to power at an interesting time for the integration movement. With the help of Reagan-appointed judges and justices, court decisions in the 1990s absolved many local districts from their legal obligations to desegregate schools. Between 1988 and 2006, the number of black students attending majority-white schools dropped by 16 percentage points. Between 2000 and 2008, the number of schools where at least 75 percent of students qualified for free or reduced-meals—a proxy for poverty—jumped from 12 percent to 17 percent.

But many districts were also interested in racial and economic diversity, even if they weren’t legally required to promote it. And so various voluntary integration experiments began cropping up around the country. These new efforts seemed promising but quickly faced legal challenge. In a pivotal 2007 decision, Parents Involved in Community Schools v. Seattle School District No. 1, the Supreme Court rejected voluntarily desegregation plans in Seattle and Louisville, on the basis that their particular student assignment strategies relied too explicitly on race. But the Court did clarify that, under certain conditions, districts can use race-conscious measures to promote diversity. Justice Kennedy even endorsed specific strategies to do so, including magnet schools and interdistrict plans.

The years immediately following the Parents Involved decision sparked confusion, largely thanks to the Bush administration. While the majority of Supreme Court justices said districts could consider race in school assignments, the Bush administration posted a federal guidance that suggested only race-neutral means of pursuing integration would be legal.

In 2009, shortly after President Obama took office, a group of educators, policy advocates, and civil rights leaders came together under the banner of the National Coalition on School Diversity (NCSD) to try and push the new administration to take action.

“Our very first goal was to get the Department of Education to take down the guidance from the Bush administration, which told schools they could not promote racial and economic diversity,” said Phil Tegeler, executive director of the Poverty & Race Research Action Council and NCSD coalition member. Their efforts were ultimately successful. By December 2011, the department posted a new guidance, which affirmed the Supreme Court’s decision and listed various ways school districts could pursue voluntary integration.

Other NCSD efforts met less success. One of their primary objectives has been to get the Obama administration to prioritize school integration within their competitive federal grant programs. While Secretary of Education Arne Duncan has repeatedly said that he supports school diversity and wants to reduce racial isolation, his department has not, for the most part, translated such support into its competitive programs.

Despite NCSD’s urging, the department declined to use its largest grant, the $4 billion Race to the Top initiative, to promote racial diversity. Duncan argued that including incentives for voluntary integration would have been too difficult to get through Congress. He also said that when it comes to successful integration efforts, we can’t “force these kinds of things.”

In 2013, Richard Rothstein, a research associate at the Economic Policy Institute,responded strongly to Duncan’s arguments, pointing out that “no education secretary has been as deft as Arne Duncan in creating incentives—both carrots and sticks—to get states to follow his favored policies that are technically voluntary.” Duncan used incentives to get states to adopt Common Core standards, to promote after-school programs and early childhood education, and even within Race to the Top, incentives were used to encourage states to adopt teacher evaluation systems tied to student test scores. But in the case of school integration, Rothstein noted, suddenly Duncan sings a different tune.

“Only in this area, apparently, does Secretary Duncan believe that progress must be entirely voluntary, unforced by carrots and sticks,” Rothstein wrote. There have been plenty of opportunities to incentivize racial integration, such as rewarding states that prohibit all-white suburbs from excluding poor people through zoning ordinances, or withholding No Child Left Behind waivers from states that allow landlords to discriminate against families using federal housing vouchers. “Adoption of such ‘voluntary’ policies could make a contribution to narrowing the academic achievement gap that is so much a focus of Secretary Duncan’s rhetoric,” Rothstein said.

Despite a frustrating first term, desegregation advocates have seen some progress in the last couple years. The Department of Education recently began to include diversity as a funding priority in several of its smaller grant programs like the preschool development grants and its charter school grants; it also announced that magnet-type integration approaches are eligible for the school improvement grants (SIG) program.

While modest, these changes have led to some important new integration experiments. At the end of 2014, New York’s education commissioner, John King, helped launch a socioeconomic integration pilot program to increase student achievement using newly available federal SIG funds. King has since moved to the Department of Education, where he now serves as Arne Duncan’s senior advisor.

Other advocates have capitalized on the Department of Education’s 2011 guidance. David Tipson, executive director of New York Appleseed, says it was an absolute game-changer for his work in New York City. “Getting that correct interpretation, with some real practical guidance for school districts, I can’t even emphasize how important that was,” Tipson said. “There was a very deliberate effort to misconstrue the 2007 [Supreme Court] decision and put fear into many school officials across the country. Everything we’ve been able to do to promote school integration has come in the wake of getting that new federal guidance in place.” New York Appleseed, along with community stakeholders, sought to design a zoning plan that would help keep a school located within a gentrifying Brooklyn neighborhood integrated. Officials resisted at first, but they eventually relented after advocates presented them with the federal guidance. Thus at the beginning of the 2013-2014 school year, Brooklyn’s P.S. 133 became the first school in Bloomberg’s administration to foster a specific mix of students based on socioeconomic status and English proficiency. At the school’s ribbon-cutting ceremony, the city’s school chancellor said he believed their innovative admissions model could be replicated elsewhere.

While advocates of desegregation are happy to see the administration beginning to prioritize diversity within its grant programs, some feel these gestures are too little, too late.

In a letter sent to Secretary Duncan last July, NCSD noted that while the Department of Education has included preferences for diversity within some grant programs, in practice, the department has “consistently underemphasized” these incentives. Many grants still make no mention of diversity at all, and in cases where they do, officials tend to weigh other competitive priorities far more heavily, rendering the modest diversity incentives ineffective. For example, in one grant, applicants could earn an additional five points if their school was diverse, but applicants could earn twice as many bonus points if their school would serve a high-poverty student population

The only federal education initiative to significantly emphasize integration is the Magnet School Assistance Program (MSAP), a program first launched in 1976. However MSAP has limited impact today due to the small amount of federal funding it receives. Even though charters are far more likely than magnets to exacerbate segregation, the department gave MSAP $91.6 million in 2014, compared to the $248.2 million it gave the Charter Schools Program.

Advocates have not given up. Next month in D.C., the NCSD will be hosting a national two-day conference, bringing together scholars, educators, parents, students, and policymakers to continue, “building the movement for diversity, equity, and inclusion.” John King will be speaking on a panel there about the progress they’ve made, and further challenges they face on the federal level. NCSD hopes that King’s new role at the Department of Education will motivate the government to take integration efforts more seriously. The department’s press secretary, Dorie Nolt, told The American Prospect that “we’ve taken meaningful steps, and we want to do more.”

Yet this administration has fewer than 18 months left. And the next secretary of education could quite easily end even the modest progress that NCSD has fought for. “Promoting voluntary school integration is an area where the department has a lot of leeway to act on its own, in terms of trying to encourage state and local governments to prioritize diversity,” said Tegeler. “But that also means the next department has a lot of leeway to not act.”