Pricing gap Section 8 vouchers more difficult to redeem as rents rise

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ELLSWORTH – Rick Clark sat in his wheelchair outside the Emmaus Center for the homeless one recent afternoon, taking in the sun that has been so elusive this summer.

Clark has been staying at the center for five months, waiting to move into low-income housing through Section 8, a federal program that allows applicants to obtain vouchers to help pay for housing costs.

“It’s been a long process,” said Clark, who was on a waiting list for a voucher until recently. “Some agencies have waiting lists nine months long. [Now] I’ve been waiting for call backs from a few landlords.”

Clark is not the only applicant waiting for a potential landlord to call.

“Of the vouchers we gave out, one in three expired without the individual securing a rental,” said Julie Haschem, the communications and planning manager for Maine State Housing Authority.

MaineHousing distributes 3,900 of the 12,000 Section 8 vouchers that are given out statewide, according to Haschem.

There are no comprehensive data to help explain why 33 percent of Maine Housing’s vouchers expired without being used, but Haschem speculates one major reason is that holders aren’t able to find a home within their voucher’s payment standard.

The vouchers “just aren’t worth as much now with rising costs. Landlords are finding it harder to accept them,” Haschem said.

Deborah Murphy, her husband and four daughters have been staying at the Emmaus shelter for seven months. The family found it difficult to find a three-bedroom apartment or home within their voucher’s $1,000 price range. In order to be approved as Section 8 housing, apartments or houses must have all utilities and heat included in the rent.

“It was hard finding a place in that range that would accept the voucher and have [all utilities] included,” she said. “Trying to get heat included is almost impossible. Prices were usually closer to $1,500.”

Vouchers give holders 30 days to find housing with an optional 30-day extension, which the Murphys asked for and received. After the first 30-day extension, voucher holders may apply for further extensions but must demonstrate they have been actively seeking housing.

A friend of Murphy’s husband contacted the family after reading a Bangor Daily News story last month about overcrowded homeless shelters and offered to let them live in an empty house he owned.

“He is filling out the paperwork now so he can accept our voucher,” said Murphy. “He decided to let us live there instead of let the house sit empty.”

Once the paperwork is complete, the family will move into their new home.

Terrance Kelley, executive director of the Mount Desert Island Housing Authority, said his agency is handling 375 Section 8 vouchers in the Mount Desert Island and Greater Ellsworth area, with another 100 to 125 people on waiting lists like the one Rick Clark was on for several months.

Kelley said his agency also sees problems with people unable to find landlords to accept their vouchers.

“We have a lot of people ask for extensions because they can’t find an apartment,” he said.

Kelley said increasing costs of living have “certainly” made it harder on voucher holders to find landlords willing to accept the housing vouchers.

“We have 15 to 20 families looking for apartments right now,” he said. “Finding an apartment has always been a challenge at best, and that was before oil went through the roof.”

Voucher prices “are at the whim of the federal government,” he said. “We submitted a proposal [for increased Section 8 funds] last year and were denied.”

Section 8 rental guidelines go by fair market rates, which is the average rent in an area found using telephone surveys. The rates are updated every October.

Right now the fair market rate for a two-bedroom apartment in Hancock County is $716, according to HUD spokesperson Kristine Foye. That rate includes utilities and heat.

According to Lucy Howard, Section 8 manager for the Mount Desert Island and Ellsworth housing authorities, the average going rate for a two-bedroom apartment with all utilities is in the $900 range.

“Landlords try to adjust their rents to fit within the [fair market] guidelines,” she said. “But with gas prices everything is getting more expensive and it’s making it harder.”

Kelley would like to see the fair market rate for a two-bedroom rental increase to $850.

“That would give us some breathing room for rising fuel costs,” he said.

Haschem said that MSHA “just sent a letter to [the U.S. Department of] Housing and Urban Development to increase voucher values, but unless it is a rapid and significant increase it isn’t going to help.”

HUD received MSHA’s and MDIHA’s requests for a rise in the fair market rate and “they are under review,” said Foye. “There is a little bit of time, so they can still be changed.”

Foye declined to comment further on the review process of MSHA’s and MDIHA’s requests.

The situation “is not helping the increasing homeless rate,” said James Winn, program manager for the Bangor Area Homeless Shelter.

“We have to turn 10 people away every night because we have no beds,” he said. “You expect that during the winter, but it’s a surprise in the middle of summer.”

Winn said that many of the people staying at the shelter, as well as others whom he turns away, have Section 8 vouchers but can’t find a place to use them.

“When you have a lack of housing and you mix in substance abuse and some mental illness, it adds up to a tough situation,” said Winn.

Bill Rae, director for the Manna Shelter in Bangor, said the solution is more funding for Section 8.

“The voucher hasn’t updated for the cost of living,” said Rae. “There are definitely less landlords willing to accept than last year because of fuel costs.”

Local landlords agree.

“Oil prices, insurance and taxes are so high it’s hard to show a positive cash flow,” said Tim Harvey, owner of Harvey’s Real Estate in Bangor. “You can’t rent the units for what Section 8 is willing to pay.”

Harvey, who operates more than 100 housing units in the Bangor area, said financial problems are exacerbated when a Section 8 user is already in a residence.

“If I have a person paying $550 and the going rate is $650, I can’t increase the rent. It takes an act of Congress,” he said.

Landlords need to submit a 60-day notice to their local housing authority if they want to increase rent, and then it has to be approved. So a landlord in Bangor would submit a request to the Bangor Housing Authority while one in Ellsworth would submit a request to the Ellsworth Housing Authority.

“As a landlord you shouldn’t have to beg,” said Harvey. “It’s a big hassle. You can’t make everybody homeless, so you end up with a lot of people paying less” than what their apartments are worth.

Harvey estimated he was losing between $50 and $75 a month for each unit he owns.

Harvey and other landlords find the choice to evict a family or individual using Section 8 nearly impossible to make.

“You can’t evict them; that’s the last thing you want to do,” said Dale Belcher, who owns Belcher Apartments in Bangor. “They are good people. You can’t strand them. I am just going to eat a lot of the costs.”

Tenants “won’t be able to afford anything [more expensive]. Section 8 needs more funding, but the politicians are running the show. We are just waiting,” he said.

Clark is also waiting, but has since turned to a different project-specific voucher that is attached to a specific housing complex.

He is waiting to move into the Rodick Lorraine Apartments in Bar Harbor, run by the Mount Desert Island Housing Authority.

“Hopefully when there is an opening, I’ll be able to move in,” he said.

mdabrieo@bangordailynews.net

664-0524