First City-funded voucher program created for rental housing

Mayor Martin J. Walsh announced tonight in his State of the City address that Boston will create its first City-funded rental voucher program to subsidize the rents of those with most need, including families experiencing homelessness not eligible for the State’s Emergency Assistance, formerly chronically homeless individuals, and extremely low-income elderly and disabled households. 

“For the first time in Boston’s history, we will issue city-funded rental vouchers, so more low-income families can be stable and secure,” said Mayor Walsh. “By using every tool in our toolbox and coming up with creative ways to turn our assets into immediate sources of revenue, we will be able to expand opportunity for more Boston families.” 

This new voucher program announced tonight will be similar to the federal Section 8 program but funded by annual City of Boston operating funds. Over the next five years, the City estimates the program will provide hundreds of vouchers, filling the financial gap many individuals and families face in Boston’s housing market. Voucher funding from the U.S. Department of Housing and Urban Development (HUD) for vouchers is expected to continue to decline over the same period of time.

“We commend Mayor Walsh for his bold and historic commitment to create a City-funded rent subsidy program,” said Michael Kane, spokesperson for the City Rent Subsidy Coalition and the Mass Alliance of HUD Tenants, which advocated for the plan. “The pilot program announced tonight could keep hundreds of people facing displacement or on the streets in permanent homes. We look forward to working with the Mayor to implement the pilot and expand funding to address Boston’s housing emergency.”

The City will start working with housing partners to develop the program and explore different types of rental assistance such as the existing Boston Housing Authority (BHA) Tenant-Based Voucher Program, Project-Based Voucher Program and Moderate Rehabilitation Program, to work in coordination with other affordable housing programs in the City and meet the goals outlined in Mayor Walsh’s housing plan. 

“This is another great tool in the City of Boston’s ever-expanding suite of innovations to create more opportunities for affordable housing, and one that I’m very pleased to see,” said Janet Frazier, President/CEO of Maloney Properties. “I’m hopeful that this kind of voucher will give tenants who need more assistance in paying rent the capacity to stay in their homes. As a property manager for thousands of affordable units in Boston, I thank Mayor Walsh for his continuing focus on making affordability a priority.” 

The BHA, through its Housing Choice Voucher Program, also known as Section 8, provides rent subsidies to assist eligible low-income families obtain decent, safe, and affordable housing. Families can select housing within a neighborhood of their choice in privately-owned housing and receive rental assistance, called vouchers, which allow families to pay a reasonable share of their income toward rent while the program the BHA pays the other portion. Most BHA vouchers, including Housing Choice Vouchers, are funded by the federal government. BHA also administers vouchers through the state-funded Massachusetts Rental Voucher Program.

In the last few decades, Congress has severely cut its annual investment in Public Housing capital funds, which traditionally help housing authorities to maintain their existing public housing units. Even with modest increases in funding for the Section 8 program, this overall federal disinvestment in affordable housing that has forced the BHA and other agencies to convert some public housing into project-based Section 8-subsidized units, and to rely on outside investment to renovate and replace older units. Meanwhile, the need for affordable housing in Boston has only grown. BHA maintains a waitlist of more than 47,000 families who have applied for one of its affordable housing programs.

Last month, the BHA was awarded $1.8 million from HUD to fund 139 housing vouchers for residents with disabilities, homeless families and chronically homeless individuals. In April, the BHA was able to issue 1,000 new rental housing vouchers after it secured approximately $28 million in additional funding for vouchers by demonstrating the need for a higher Fair Market Rent (FMR), which sets the payment standard housing authorities can set for voucher-subsidized rents and determines subsidy levels for voucher holders. These vouchers increased the BHA's portfolio of vouchers to 13,500.

“A housing voucher gave me a chance to secure a safe, stable and healthy home environment for my children when we were struggling with homelessness, and gave me the space to pursue rewarding work in early childhood education,” said voucher holder Paulina Morillo, a resident of Dorchester. “This new voucher program has the potential to help many other families like mine.”

Through increases in the City’s operating and capital budgets, the investment announced today will double the City’s current funding in affordable housing to $100 million. Additional revenue will be generated by selling the Lafayette Garage, as well as working with the Massachusetts Legislature to approve a transfer fee of up to 2 percent on private real estate sales over $2 million in the City of Boston. These combined investments will increase the available funds for affordable housing to five times the current funding levels.

The City-funded rental voucher program announced tonight builds on the Mayor's comprehensive approach to prevent displacement and end homelessness. Through the efforts of Boston's Way Home, Mayor Walsh's initiative to end veteran and chronic homelessness, Boston has made significant progress in preventing and ending homelessness among individual adults, including ending chronic veteran homelessness. Through this initiative, over 900 chronically homeless individuals have been housed, representing more than 5,800 cumulative years of homelessness ended. As a result, chronic homelessness has been reduced by 19 percent during a time that there have been increases in chronic homelessness nationally. Furthermore, the City's partners housed over 1,200 homeless veterans and reduced homelessness among Veterans by 36 percent.

Since Mayor Walsh took office, the City of Boston has built over 60 percent of the new homes in Greater Boston, with 20 percent of them being deed-restricted for low- and middle-income households. Boston has surpassed 32,000 units permitted under the administration's housing plan, including over 6,200 deed-restricted units and 500 units for senior housing. More than one thousand Boston Housing Authority units have been renovated and the Department of Neighborhood Development (DND) has assisted over 600 homebuyers in purchasing their homes.