State-Funded Rental Vouchers: Connecticut and Our Neighbors

By: Alysha Gardner, Senior Policy Analyst, Partnership for Strong Communities

To kickoff the 2024 legislative session, the Partnership convened its first IForum of the year on February 1, delving into state-funded rental voucher programs. We welcomed a stellar lineup of presenters:

  • Dr. Shante’ Hanks, Senior Advisory for Education and Housing Stability, from CT’s Department of Housing (DOH), provided opening remarks discussing the state’s new Head Start on Housing program;
  • Lindsay Duvall of the National Low Income Housing Coalition (NLIHC) presented on their comprehensive national database of state and local rental housing programs;
  • A regional panel featuring government officials including Steve DiLella, Director, CT; Janel Winter, Assistant Commissioner, NJ; Cecelia Woodworth, Assistance Director, MA; and moderated by Christi Staples, United Way of Massachusetts Bay and Merrimack Valley, MA. Each panelist shared their perspectives as administrators of state-funded rental assistance programs.
  • A presentation on the report “A Right to Rental Assistance in Massachusetts,” exploring costs, benefits, and implementation considerations of transitioning to a state universal voucher program, with report authors Evan Horowitz, Tufts University; Chris Norris, Metro Housing Boston; and Helen Murphy, The Boston Foundation.

Exploring Benefits and Limitations of Federally Funded Rental Vouchers

Before diving into our event, let’s clarify “state funded” rental voucher programs and their significance. You may be familiar with the federally funded Section 8 housing voucher program. Qualifying households (earning >50% of Area Median Income) can receive a voucher allowing them to rent in the private market, paying up to 30% of their income in rent; the federal government covers the rest. These long term vouchers allow for housing stability for the tenant and income stability for the landlord, and are a powerful tool for affordable housing – particularly for seniors or disabled individuals on a fixed income or for low-income families with children seeking to move from low opportunity neighborhoods to high opportunity neighborhoods.

Studies affirm that Section 8 vouchers are unequivocally one of the best existing policy programs to lift households out of poverty; however, this program has consistently been under-funded at the federal level. Only 1 in 4 eligible households who qualify for a voucher actually receive it, and families can sit on waiting lists for years. Current Congressional budget bills lack sufficient funding to even keep pace with current rent increases, leaving around 100,000 households unable to access vouchers next year. Implementation challenges, like administrative barriers and below-market-rate reimbursements, complicate finding rental housing, even with vouchers in hand. 

Pivoting to State Funded Rental Voucher Programs

However, a handful of states – CT, MA, NJ, IL, and HA – have created their own state-funded voucher systems, expanding vouchers for eligible residents, eliminating bureaucratic barriers, and targeting specific high-need populations. For example, MA offers vouchers regardless of immigration status. NJ links vouchers with Medicaid recipients, ensuring housing stability alongside federal healthcare benefits. At the IForum, CT DOH’s Dr. Hanks shared how CT piloted a “Head Start on Housing” initiative, connecting Rental Assistance Program (RAP) vouchers with low-income children aged 0-5, fostering housing stability, allowing children to thrive, and breaking cycles of intergenerational poverty.

At the Partnership, we conduct this cross-state analysis aided by NLIHC’s Rental Housing Programs Database. Lindsay Duvall, Senior Housing Advocacy Organizer, presented an overview of the database (recently updated in October 2023), which collects information on state and locally funded programs that create, preserve, or increase access to affordable rental housing. Users can search by state, program type, and income eligibility; then select the program for additional details, including eligibility requirements, total funding and funding source, and links to additional information.

With over 280 different programs identified, policymakers and advocates can seek inspiration and learn from existing programs in other states. We can leverage this tool to foster policy efficiencies by collaborating with neighboring jurisdictions facing similar challenges.

State Rental Vouchers: An Exercise in Managing Scarcity

CT, MA, and NJ all have state-funded voucher programs modeled after the federal Section 8 program. Our three panelists, Steve DiLella (Director of Individual and Family Support Program Unit, CT), Janel Winter (Assistant Commissioner of the Division of Housing and Community Resources, NJ), and Cecilia Woodworth (Assistant Director, State Programs, Division of Rental Assistance, MA), joined us to discuss each of their state’s programs.

State Name of Program Implementing Agency Number of Active Vouchers Number of Extremely Low Income Renter Households in State
CT Rental Assistance Program (RAP) CT Department of Housing 6,700 [5% of need] 142,400
MA Massachusetts Rental Voucher Program (MRVP) MA Executive Office of Housing and Livable Communities 9,600 [3% of need] 313,600
NJ State Rental Assistance Program (SRAP) and Supportive Housing Connection NJ Department of Community Affairs 17,000 [5% of need] 323,300

To varying extents, each state groups its vouchers into further “bucket” programs targeting special populations. While a portion of the vouchers is set aside for families or households based on income eligibility standards (ranging from 50-80% of Area Median Income), other vouchers are set aside for specific populations such as homeless individuals, families involved in the foster care system, individuals with physical or intellectual disabilities, justice-involved individuals (formerly incarcerated or on probation), individuals experiencing mental health or substance misuse issues, and seniors. The housing agency in each state partners with sister state agencies responsible for these target populations to get the vouchers out the door quickly to the most vulnerable individuals, often with the help of wrap-around or supportive services built into their new housing situation.

Officials from all three states emphasized a key benefit of state voucher “buckets” is the opportunity to work with non-housing focused service providers. DiLella (CT) shared:

“Being able to work with sister state agencies is the best way to help those who cycle between different systems… When you provide permanent and stable housing, many other outcomes for our sister state agencies improve, whether its mental health, whether its recidivism, whether its education: all these things improve when you have a place to call home. My goal is to have a relationship with every state agency.”

While these targeted programs can provide an affordable home quickly to vulnerable populations, a significant barrier are the constrained budgets that limit the number of active vouchers available to families, particularly those eligible primarily because of their income status. In CT, currently only ~1,600 (roughly 25%) of all RAP vouchers are allocated to low-income households (those making less than 50% of the Area Median Income) who do not otherwise fall into a special need population. Because of the limited number of vouchers available, the waitlist for RAP has only opened to accept new applications twice in the previous 17 years.

Alarmingly, DiLella shared that there has been a dramatic increase in rental costs since June 2021 due to the tight housing market – “the numbers exploded in a way I’ve never seen” – which is putting pressure on the budget for RAP, costing the department millions of dollars more to continue to provide the existing number of active vouchers. Without an increase in funding to RAP of $8M in FY25 (a key Partnership legislative priority), DOH may be forced to phase out approximately 650 active vouchers as those vouchers turn over. This reflects a 10% reduction to the overall program served and a 40% reduction to the number of vouchers for low-income eligible families.

The situation is similar across the region. In MA, there are currently 800 funded vouchers that are available for use compared to a waiting list of over 100,000 distinct households. In NJ, they opened the Section 8 voucher waitlist for 15,000 slots and received over 150,000 applications in less than three weeks. There are many more people that need rental assistance than can be served by current levels of state or federal funding. Winter (NJ) said it best:

“For all the discussions about [waitlists], the real problem is that we do not have enough money to serve everyone. We are arguing about how to better distribute the crumbs. It is important to not lose sight of what the real issue is: How do we get to a place where we don’t have waiting lists for things as basic to people as housing?”

Universal Voucher System: MA’s Ambitious Policy Proposal

The final presentation of the Iforum explored a recent policy proposal from MA’s housing advocacy community posing questions: What would happen if rental assistance were treated as an entitlement benefit, akin to SNAP, Medicaid, or the mortgage interest deduction? What impact would fully funding the state’s rental voucher program have on our housing system?

In October 2021, the MA State Senate Committee on Reimagining Massachusetts Post-Pandemic Resiliency released a report and series of policy recommendations, including the recommendation of “Rental assistance for everyone that needs it, with a carefully designed system allowing all families that qualify for rental vouchers to receive support.” Housing researchers and advocates delved into the implementation realities of this policy, presenting their report “A Right to Rental Assistance in Massachusetts: How Policy Change Can Advance Equitable Housing”.

Under a universal voucher system, the unfairness inherent in the waitlist/lottery system would be eliminated – all who qualify for vouchers would receive one. State spending on social services, such as homeless services, mental and physical health services, substance abuse, and elderly care, would decrease. Importantly, such a policy would combat racial injustices in housing: because 49% of all black families in the state and 56% of all Hispanic families in the state qualify for a voucher but can’t get one due to budget constraints, a universal voucher program would disproportionately benefit those minority groups.  Expected benefits also include reduced landlord discrimination and increased creation of new housing units in response to demand.

Evan Horowitz (Center for State Policy Analysis, Tufts) estimates universal vouchers would cost MA around $3.2 billion annually; extrapolating for CT’s population, the estimate is roughly $1.5 billion annually. Though initially staggering, these costs align with those of other universal benefit programs like SNAP ($1.1B in FY23); Medicaid ($10.0B in FY22 in total spending, $3.5B in state spending); and forgone revenue from state tax exemptions (10.0B projected in FY24, with the closest comparable category of $2.5B in forgone state revenue for fuel and road tax exemptions). Despite being costly, expanding state vouchers falls within the norm for universal benefit programs.

Where Do We Go From Here?

CT’s RAP program aids very low-income households by subsidizing a portion of their rent. It’s crucial for improving housing security, assisting severely cost-burdened renters, and addressing CT’s racial and economic inequalities. Similar to neighboring MA and NJ, CT reaps significant benefits from its state-funded housing voucher program but faces challenges like increased demand, rising rental costs, and insufficient funding.

The Partnership is advocating for key changes to preserve, expand, and improve the state Rental Assistance Program (RAP):

  • Invest $16M in the state funded Rental Assistance Program (RAP)
    • Increase the existing appropriation by $8M to keep pace with rent increases and maintain the number of families currently served by the program

    • Invest an additional $8M to expand rental assistance to 650 more low-income families, a 10% increase in current service levels

  • Improve existing data reporting to better measure the program’s need and effectiveness

To take action, please reach out to your state senators and representatives and share your personal story and perspective on why rental assistance is important to our state. Sign up for our legislative action alert emails to be notified ahead of crucial public hearings or votes related to RAP and other housing priorities. Finally, keep an eye out for future Partnership events on timely housing research and advocacy topics. 

Thank you to everyone that was able to join us for our February 2024 IForum. If you were not able to attend, we invite you to watch the recorded event at CT-N.

Our presenters have generously agreed to share slides from their presentations:

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