The U.S. Department of Housing and Urban Development (HUD) provides mainstream rental housing assistance to very low-income and low-income families and individuals. Housing assistance comes in three basic forms: tenant-based housing choice vouchers, public housing developments owned and operated by local housing authorities, and rental developments owned and operated by private landlords who have subsidy contracts with HUD under the project-based Section 8 program. HUD also administers McKinney-Vento grant programs targeted specifically to homeless people. HUDs homeless assistance programs include competitive funding for local providers of transitional housing for homeless people and permanent supportive housing for homeless people with disabilities, as well as a formula-based Emergency Shelter Grant program.
Mainstream Housing Assistance
HUD-funded housing assistance is a major source of in-kind income support, freeing up cash income for other needs by enabling assisted households to pay only 30 percent of their income for rent and utilities. A recent experimental design evaluation of the Housing Choice Voucher program found that families using vouchers were much less likely to live in unstable housing situations than families assigned to the control group and that having the availability of a voucher virtually eliminated homelessness among sample members (Mills et al., 2006). Housing assistance programs also are widely used by homeless families and individuals as a means to leaving homelessness for permanent housing.
The main barrier to the use of assisted housing by people at risk of homelessness or trying to leave homelessness is that housing assistance is not an entitlement. Altogether, it serves about 5 million households, while a similar number of renter households with incomes below 50 percent of local median income have severe or worst case housing needs and would likely use housing assistance if they could get it (US Department of Housing and Urban Development, 2007b). Thus, homeless people face stiff competition from other households on waiting lists for assisted housing. The housing authorities that administer the voucher and public housing programs may establish priorities for assisting homeless people, but such priorities are not common (Khadduri & Kaul, 2005.) One of the purposes of the Community of Care planning process required of HUD McKinney-Vento grantees is to bring local housing authorities into the effort to end or reduce homelessness by encouraging them to create such priorities and to find ways to address other barriers to program participation, such as histories of evictions from rental housing.
Employment Supports in Mainstream Housing Assistance Programs. When homeless people are able to use HUD mainstream programs to leave homelessness, does that help them work? Like other means-tested programs, housing assistance may discourage work. Receiving housing assistance reduces the need for income to buy housing, and tenants must pay 30 percent of most earnings as their contribution toward their subsidized housing, which amounts to a 30 percent tax on top of other taxes residents pay on their earnings (Olsen et al., 2005).
However, the work disincentive effect of public housing and housing vouchers is not as strong as is widely thought. Corcoran and Heflin (2003) studied current and former welfare recipients receiving housing assistance and how they differed from those not receiving assistance on various potential barriers to employment. They found that housing assistance is not associated with the probability of receiving welfare or being sanctioned for noncompliance with the work requirement. Additionally, they found that support for the relationship between housing assistance and work outcomes is weak. Housing assistance has no effect on the probability of being employed, the natural log of weekly earnings, the percentage of months observed working, or the percentage of months observed receiving welfare.
The recently completed Housing Choice Voucher Demonstration randomly assigned more than 9,000 current and former TANF families to program and control groups in six sites. The demonstration, which included many families that were unstably housed or homeless, found that the reduction in labor supply caused by housing vouchers was modest and temporary (Mills et al., 2006).
The Family Self-Sufficiency (FSS) program is HUDs program to help voucher families obtain employment that will lead to economic independence and self-sufficiency. Housing authorities work with welfare agencies, schools, businesses, and other local partners to develop a comprehensive program that gives participating FSS family members the skills and experience to enable them to obtain employment that pays a living wage. FSS has not been rigorously evaluated, but both case studies and analyses of FSS participant outcomes have been encouraging (Sard, 2001; Ficke & Piesse, 2004). No one has studied the extent to which formerly homeless families who use vouchers participate in the FSS program.
A demonstration project, Jobs Plus, sought both to reduce public housings role as a barrier to employment (by limiting increases in rent due to increased earnings) and increase its role as a bridge (by offering attractive, place-based services in public housing). The evaluation found statistically significant impacts on public housing residents earnings, whether or not the residents lived in their homes for extended periods. The overall effects were determined primarily by large, sustained impacts in Dayton, Los Angeles, and St. Paul, where implementation of Jobs Plus was strongest (Bloom, Riccio, & Nandita, 2005; Riccio & Orenstein, 2003).
In addition to housing assistance programs without a specific target population, HUD also funds the development of housing dedicated for occupancy by elderly people through the Section 202 program and housing for people with disabilities through the Section 811 program. Section 811 housing can be one of the permanent housing options for people with disabilities. Another residential program, Housing Opportunities for People with AIDS, is among the programs often identified in particular communities as preventing homelessness or helping people leave homelessness.
McKinney-Vento Homeless Assistance Programs
Among HUDs programs explicitly targeted to homeless families and individuals, the McKinney-Vento Supportive Housing Program can be used for transitional housing; permanent housing; and for services, including employment supports, that are part of a particular residential program or that serve a broader homeless population. The McKinney Vento Shelter Plus Care program provides permanent housing for people with disabilities through a rent subsidy structured in the same way as mainstream assisted-housing programs (residents pay 30 percent of their income and the subsidy pays the balance of the housing cost). Grantees must match the Shelter Plus Care rent subsidy with funding for services that comes from other sources. Services usually include case management focused on working and increasing employment income.
Employment is an important objective for transitional housing programs, both as an aspect of self-reliance and because the limited availability of both mainstream assisted housing and supportive housing means that moving to permanent housing often means having enough income to pay for it. Employment is important for permanent supportive housing because of its importance for self-reliance and self-esteem and because residents of supportive housing often want to move on to mainstream housing.
HUD has established performance goals under the Government Performance Reporting Act (GPRA) for its McKinney-Vento programs that give employment gains the same importance as housing stability. Reviewed annually, the programs are expected to increase the percentage of clients working by 11 percent from entry to exit from the program. This is expected to change in 2007 to a performance measure that expects an additional 18 percent of exiting clients to be employed compared with the percentage employed at entry. Without a rigorous impact evaluation, we cannot judge the extent to which increased employment is attributable to the HUD-funded homeless assistance programs.
We also do not have systematic knowledge of the type of employment services and work supports that are provided to homeless people in connection with residential programs for homeless families and individuals or to other homeless people (those in emergency shelters or unsheltered) as part of local continuums of care. Vocational training, job search assistance, and job placement all are used by particular providers and in particular communities, but no one has documented the patterns or assessed the quality and appropriateness of the services provided to particular groups of clients as part of local strategies to address homelessness.
Supportive Housing and Employment-Related Services. In Philadelphia, researchers tracked 96 leavers of permanent supportive housing and found that less than a quarter engaged in paid employment. The study examined the experience of some 943 residents of permanent supportive housing in the City during the period from 2001 to 2005 (Wong et al., 2006).
Many supportive housing organizations appear to recognize the important role employment can play as a source of income from which tenants pay rent; as a viable platform from which to enter the workforce; and as an important occupying activity in the face of potential idleness. Employment services are frequently part of the supportive services linked to permanent supportive housing (Burt & Anderson, 2005). Supportive housing projects in New York, Chicago, San Francisco, and other cities combine housing with social services and employment and educational services (Rio et al., 1999). Supportive housing for homeless people, including single adults and heads of family households with complex needs, frequently offers job-retention supports to help residents maintain their attachment to the workforce.
Research evidence on the effectiveness of supportive housing generally does not focus on the separate effect of employment-related services (Martinez & Burt, 2006; Nelson et al., 2005; Rog, 2004; Tsemberis, Gulcur, & Nakae, 2004; Rosenheck et al., 2003; Rog & Randolph, 2002; Culhane, Metraux, & Hadley, 2001). However, Long and Amendolia (2003) evaluated the cost-effectiveness of employment and training supports provided as part of the Next Step: Jobs Demonstration, which introduced intensive new services to existing supportive housing programs operating in New York City, Chicago, and San Francisco. The demonstration was conducted between 1996 and 2000 with funding from the Rockefeller Foundation. Demonstration services included basic and life skills training, GED and ESL classes, vocational training, on-site employment (mostly in program-sponsored businesses), and job development and placement services. The net impacts of the services were estimated using a comparison group research design and regression adjustments for demographic and pre-enrollment experience differences between program and comparison groups. The study concluded that the benefits of the employment supports resulting primarily from statistically significant increases in earnings and reductions in the use of transfer program far exceeded their costs to the Foundation and government programs.