Planning Magazine

States Consider Source-of-Income Laws to Fight Housing Voucher Discrimination

As the Biden administration looks to expand Section 8 housing assistance, renters, landlords, and local governments grapple with the program's flaws.

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The Housing Choice Voucher Program offers rental assistance to more than 2 million households, but under federal law, landlords can reject tenants enrolled in the program — allowing for racial discrimination, advocates say. Photo by Monica Almeida/The New York Times.

President Joe Biden wants to expand Section 8 housing assistance to more than 200,000 additional families. The administration proposed an additional $5.4 billion in hopes that housing vouchers will help low-income people at risk of homelessness because of the pandemic.

But the challenge for many voucher-holders is finding landlords willing to accept them.

Alice Robinson of Dallas knows this problem well. Robinson, 62, has used a federal housing voucher to cover two-thirds of her rent. For the past three years she'd been living at an apartment complex in south Dallas, but last month her landlord refused to fix a leaky water heater and failed a yearly inspection required under Section 8.

The local housing authority told her she had two weeks to find a new home.

"I nearly ended up homeless because I couldn't find an apartment," says Robinson, a Black woman who raised five children on her own. "They say they have availability but as soon as I ask if they take Section 8, suddenly those vacancies disappear."

Bidens's 2022 spending request is expected to be submitted to Congress for approval in the next few months.

Nationwide, more than 2.2 million households receive federal subsidies through the Housing Choice Voucher Program. The program, established in 1974 under Section 8 of the U.S. Housing Act, is meant to fill the gap between what families can afford to pay and local rents. But under federal law, landlords are free to reject tenants with vouchers.

An increasing number of states and cities are stepping in to help.

More than a dozen states have enacted so-called source-of-income laws that bar landlords from rejecting prospective tenants because they plan to use housing aid to pay the rent. Five of the states have acted in the past three years, according to the Poverty and Race Research Action Council, a civil rights and policy organization based in Washington, D.C. More than a hundred localities have similar laws.

But these laws have been contentious, and not all states are moving in the same direction. Rhode Island last month became the latest state to enact a statewide source-of-income law. But two weeks later, Iowa moved in the opposite direction, through a law banning localities from passing protections for voucher-holders.

Critics argue that source-of-income laws unfairly force property owners to participate in a supposedly voluntary program that they say is inefficient and costs them thousands each year in lost income. An ongoing battle in Texas over a state law that bars local source-of-income laws illuminates the issues.

Opportunities for discrimination

Two days before Biden announced his proposed Section 8 expansion, property owners and tenants' rights advocates testified before the Texas House Urban Affairs Committee on a proposed repeal of Texas' 2015 law barring local source-of-income ordinances.

Christina Rosales, deputy director at Texas Houser, a research and advocacy organization focused on renter protections, testified at the hearing that voucher discrimination allows landlords to turn renters away based on race, color, national origin, sex, family status, disability or age.

She testified that while these are protected classes, landlords often discriminate against voucher-holders, who are mainly women of color, by setting rent above the fair market values set by the U.S. Department of Housing and Urban Development every year, or by outright refusing to accept vouchers.

"Saying they don't accept vouchers is all a proxy for race," Rosales says. "I've heard of landlords who say, 'They have a different lifestyle than the people that we want living here.'"

"It's all very dog whistle racially coded," she adds.

"Saying they don't accept vouchers is all a proxy for race. I've heard of landlords who say, 'They have a different lifestyle than the people that we want living here.'"

— Christina Rosales, deputy director at Texas Houser

Because voucher-holders are most likely to be Black, many advocates argue that landlords who reject voucher-holders are in fact discriminating based on race, which is illegal under federal fair housing laws.

Data from the Department of Housing and Urban Development shows that 48 percent of voucher-holders were Black, 32 percent were White, 17 percent were Hispanic, and 2 percent were Asian in 2017.

Demetria McCain, president of the Dallas-based Inclusive Communities Project, which advocates for affordable housing, says the legislation that would repeal the Texas law is vital. "[The law] takes away the ability for local government to deal with fair housing issues and the housing crisis which has only gotten worse during the pandemic," she says.

"Ending discrimination can have a long-lasting impact on the families who receive these vouchers because it dictates where they can and can't live, where their kids play and go to school."

A 2015 Harvard University and National Bureau of Economic Research study found that poor children who move to lower-poverty neighborhoods before age 13 are more likely to attend college, earn higher incomes, and reside in better neighborhoods as adults.

An outdated system?

The effort to repeal the Texas law is unlikely to succeed. It faces stiff resistance from the Texas Apartment Association, a large financial supporter of Texas state legislators and candidates for statewide offices. The TAA's political action committee played a crucial role in getting the state preemption law introduced and passed.

Ian Mattingly, director of the Apartment Association of Greater Dallas, says property owners often wait days or weeks for a housing authority inspector, costing them thousands every year because a unit is empty while it is being approved for occupancy by a voucher recipient. Mattingly, who is also a property manager, says he often has to deal with late or insufficient payments from housing authorities.

"I have over $100,000 in rent outstanding for the 400 families that are currently receiving Housing Choice Program assistance," Mattingly said during the hearing. "It's not because they've lost jobs. It's not because they've lost income. It's because public housing authorities, which are frequently underfunded and undermanned, have failed to make payment on those folks in a timely fashion."

Mattingly describes himself as an affordable housing advocate because he helps manage 7,200 rental units in the Dallas-Fort Worth area, 400 of which are reserved for voucher-holders. But he opposes forcing landlords to take Section 8 tenants.

"Advocates on the other side have a really simple message, it's about race because most people who have vouchers happen to be people of color. And it's a very compelling message, particularly at this moment. It's certainly one that resonates with me," Mattingly says.

"But it's important to note that this is a federal program that is 40 years-old that simply was built for a different market that doesn't exist anymore. The best solutions are the ones that are grounded in reality — not in good feelings and ambitions."

He says the program comes with financial burdens, including additional administrative tasks and almost a dozen different ways in which the public housing authorities, which administer Housing Assistance Program contracts, can terminate a lease agreement.

One of those ways is if a unit fails to pass a yearly inspection. The inspections are in place to ensure voucher-holders don't live in substandard housing, but Mattingly describes the process as "highly subjective."

"I've seen apartments failed because of a hairline crack in a plastic faceplate over a light switch cover," Mattingly says. "In a conventional lease you inspect the apartment yourself, you decide if this works for you or not, there's not this kind of Big-Brother-looking-over-your-shoulder scenario."

Mattingly has been promoting an app he helped develop that uses artificial intelligence to streamline the application and inspection process. He says it might persuade more property owners to participate in the program.

Voucher-holders like Robinson could use the help.

During her most recent search for an apartment, Robinson was hoping to find a place in a Dallas suburb such as Plano, Irving or Richardson. But she couldn't find any properties outside of South Dallas that had apartments available and were willing to accept her voucher.

"It's almost as if you're being forced to live at a certain standard," Robinson says. "I know crime happens everywhere, but someday I would like to live somewhere where I can feel a little bit safer than I do when I'm walking to my car or going to the store."

This story was reprinted with permission from Stateline, an initiative of the Pew Charitable Trusts.

Kristian Hernández is a staff writer for Stateline. This story was reprinted with permission from Stateline, an initiative of the Pew Charitable Trusts.

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