The Cost of Administering the Housing Choice Voucher Program
- The appropriate funding levels for the HCV program needs to be determined.
- Abt conducted a series of analyses.
- Our study discovered discrepancies between costs and funding.
The Housing Choice Voucher (HCV) program is the federal government’s largest low-income housing assistance program. It gives 2.1 million households subsidies to rent units in the private market. The 2,300 public housing agencies (PHAs) that administer the program manage waiting lists, verify eligibility, calculate the income-based subsidy, and assess housing units for quality and reasonableness of rents. The formula for allocating administrative fees has relied on differences in fair market rents as a proxy for actual costs. The appropriate funding levels for the program needs to be determined.
Abt studied actual HCV program administration costs at 60 high-performing PHAs. Abt measured staff time, collected real-time data through the use of hand-held devices, analyzed program budgets, and surveyed smaller PHAs. After calculating per voucher administrative costs for each PHA, Abt used regression analysis to explain cost variations.
Only two of the 60 PHAs received enough fees to cover their costs during the study.
The average cost of administering the program in 2013 was 36 percent above the average fee received, and the total administrative cost for the program for the studied period was $375 million more than what HUD provided.
The proposed fee formula included seven variables such as local wages and the share of voucher households served that have income from wages.