Federal housing assistance is a scarce non-entitlement program that low-income families can build on to improve their lives, but housing programs can also create barriers to families’ economic progress. Many assisted households remain trapped at low-incomes for fear of earning enough to go over the assistance cliff and lose their housing assistance – support that they may have waited several years to receive.
There is a solution. It’s called FSS.
FSS, or the Family Self Sufficiency program, changes the income incentive for families with housing assistance. In the absence of FSS, any increase in household income leads to an increase in rent — therefore limiting families’ incentive to work or report their earnings completely. FSS changes the game. For an FSS participant, any increase in household earnings still increases the rent, but an amount equal to the rent increase goes into a savings account for families (also called escrow). This means families grow accustomed to paying higher and higher rents as they earn more, while also building a nest egg to help them achieve any of their goals or dreams.
The program is also a win for public housing authorities. Families pay more in rent, the housing authority’s housing assistance payment (HAP) goes down, and the escrow money comes from HUD. Over time, housing authorities can serve more families and help their existing clientele make headway along a path to economic success. And they don’t even feel it in their bottom line.
So, why don’t more housing authorities offer FSS? Supportive service funding is the main limiter. Housing authorities understand how to work with HUD funding, and many are not equipped to find funding in other ways. With stagnant federal funding for FSS coordinators, it’s hard to blame housing authorities for not offering FSS or trying to expand existing programs’ reach.
But there are FSS models that work. Partnerships that bring in case managers. Funders who will gladly cover program costs when they learn that it opens up a pathway out of poverty. Using public dollars to leverage philanthropy? Who doesn’t want that?
Let’s expand this program. Let’s get FSS everywhere – explaining to housing authorities that it’s ok to operate a program with no service coordinator money from HUD. And explaining exactly how to do it.
Let’s also break FSS out of the arbitrary limitation to the housing choice voucher program and public housing. What about project-based rental assistance? We could and should easily shift to allowing all HUD-assisted households to benefit from FSS. Even affordable homes developed using the Housing Credit, with some extra thinking, could offer a better economic support system for their residents.