July 2014: Rental Assistance programs are one way CPA can help support the housing needs of individuals and families in a community. These programs help close the financial gap for low or moderate income residents who are struggling to secure housing and make regular rent payments. In addition to supporting tenants' financial needs, a rental assistance program can also help communities as a whole by alleviating local housing market instability.
The 2012 amendments to the Community Preservation Act (Chapter 139, sections 69-83 of the Acts of 2012, An Act to Sustain Community Preservation) clarified that that rental assistance programs are an eligible CPA community housing application, falling under the “support category” of the allowable uses chart.
To better understand how rental assistance programs work in conjunction with CPA, Shelly Goehring, affordable housing expert and Program Manager at the Massachusetts Housing Partnership (MHP), sheds light on the inner workings of Martha’s Vineyard’s program, and Coalition staff delve into specifics about Eastham’s new program. Read on below to learn how CPA funds have been used to sustain two local rental assistance programs.
Martha's Vineyard Rental Assistance Program
Martha's Vineyard has had a rental assistance program for 12 years, administered by David Vigneault, the executive director of the Dukes County Regional Housing Authority (DCRHA). All towns on the Vineyard contribute to the program through their local Community Preservation Funds, and some also contribute through a local Municipal Affordable Housing Trust (MAHT). While the main intent is that a community’s own CPA funds go toward a property owner and resident in that specific community, ultimately the towns of Martha’s Vineyard have come to understand the larger importance of having stability in the island-wide rental market. This means that sometimes funds from one town support a renter in a different community on the Vineyard, but in the end, all the Vineyard towns benefit.
Key elements of the Dukes County (Martha’s Vineyard) Rental Assistance program:
- The program targets year-round residents of the island’s communities.
- Most recipients receive assistance for three years. Single parents, seniors and people with disabilities may receive rental assistance for longer.
- Residents making less than 80% of the area median income ($63,500 for a family of four on Martha’s Vineyard) are eligible for assistance and pay no more than 30% of their gross income towards rent. To see the maximum income limits for residents in your community, view the 2014 CPA low income housing limits for all municipalities here and the 2014 moderate income housing limits here.
- The tenant’s portion of the rent must be a minimum of 50% of the rent. Rent rates are determined by the U.S. Department of Housing and Urban Development (HUD) Fair Market Rents for Dukes County.
- A lease is signed between the property owner and tenant, and a housing assistance contract is signed between the property owner and housing authority.
- The DCHRA makes a request for funding to each community's Town Meeting each year; this request lays out how many rental assistance subsidies were given in the previous year, the average cost of each rental assistance subsidy and whether any previously allocated money remains.
- A town appropriates a set amount to the DCHRA each year, but if funds from the previous year’s appropriation remain, that balance can be deducted from the current year’s appropriation.
- Each month, the DCHRA invoices towns instead of a lump sum being given after Town Meeting.
The DCHRA does outreach to local landlords, even advertising the opportunity for owners in the local paper, and then screens tenants and inspects units once a year. For 2013, 66 rental assistance subsidies were provided on Martha's Vineyard and 147 people were on the waiting list.
Eastham Rental Assistance Program
The town of Eastham, on Cape Cod, has operated its CPA-funded rental assistance program for almost two years. The program was initiated by the Eastham Affordable Housing Trust (EAHT) in response to a Housing Production Plan finding that rental housing was particularly needed in the community. Since the EAHT did not have the capacity to administer the program itself, it issued an RFP to contract for the services, and partnered with two non-profits; the Harwich Ecumenical Council for the Homeless (HECH) and the Homeless Prevention Council. Additional monies to support the program come from Community Development Block Grant funds.
Key elements of the Eastham Rental Assistance program:
- HECH accepts applications from families and determines whether they are eligible for the program; families must be at or below 60 percent of the area median income to qualify.
- Families can receive up to $350 per month to help cover the gap between their income and rent and utilities; they can get assistance for a total of three years, but each year the amount of their assistance is reduced.
- The Homeless Prevention Council works with each family on goal setting and financial management.
- The goal is to help each family achieve self-sufficiency after three years in the program.
Just two years in to the program, three families have already graduated from the program, and as Peter Wade, Eastham’s Community Preservation Committee Vice Chair noted, “people are using it as intended, as a transitional [support].” Alice Boyd, a consultant who provides staff services to the EAHT, is very positive about the program’s impact thus far: “It’s changed lives,” she says. Not only has it provided needed support for families in difficult straits, but it has helped stabilize the area’s seasonal housing market, which suffers from a slew of vacant houses during the winter months and a lack of affordable housing for service workers and their families in the summer months. With the benefit of the rental assistance program, landlords are pleased to have reliable year-round tenants, while families don’t have to pick up and move each spring to make way for weekly renters able to pay high summer rental prices. The program has helped the community’s economy by allowing service workers to stay in the area, thus providing a more stable workforce for the increasingly important shoulder and off seasons. Finally, for the individual families involved, the program has had a positive impact. As one little boy noted, says Alice Boyd, upon hearing that his family did not have to move each year, “You mean I can put a poster up on my bedroom wall?!”
When considering developing a CPA-funded rental assistance program, it's particularly important to consider the capacity of the managing entity. Does your community have an organization with the resources and "know how" to develop and maintain a strong, effective program? If the answer is yes, as seen here in these two examples, your community might have the right foundation to launch a successful program. If you are interested in exploring whether a rental assistance program might work for your community, feel free to contact David or Shelly via their contact information below.