Alaska Housing Finance Corporation is overhauling the state’s public housing system.
Effective April 1, any family with one able-bodied adult in the household will see yearly rent increases. After five years, the assistance will end and they’ll be responsible for paying their own rent.
The changes will impact those renting public housing and those receiving voucher assistance to rent private units.
Brian Butcher, the executive director of the Alaska Housing Finance Corporation which runs the state’s public housing programs says the rent reform will free up Alaska’s overloaded public housing system, making room for only the most needy.
“What we’ve developed is what we call a rent reform program where we help educate and work with individuals that are in our public housing that can work to get jobs and to work and eventually move out of public housing,” Butcher said.
He says it’s all part of a national trend.
“There’s a real emphasis on housing agencies doing what they can to help people in the public housing to eventually get jobs and to move out a bit. so this is one piece of it that being done by a lot of housing agencies across the country,” Butcher said.
Since 2008, Alaska has been participating, along with 38 other agencies in 22 states, in a national demonstration program called “moving to work,” which is behind the rent reform.
The reason for the reform says Cathy Stone, director of the Public Housing Division of Alaska Housing Finance Corporation, there are simply too many people staying in public housing in Alaska for too long. And that creates huge waiting lists.
“Statewide, they’re extremely long. In fact we are going to be closing waiting lists around the state soon. We have over 10,000 people on our waiting lists. People are looking at 10 or 20 years of being on a waiting list. It’s not an efficient or effective way to manage our program,” Stone said.
Congressional sequestration cuts reduced their budget by 9 percent last March, and made rent reform more urgent. Seniors and people with disabilities will not see many changes. They account for about half of people in public housing in Alaska. Current residents age 57 or older will be grandfathered in. AHFC will work with those with serious medical expenses on a case-by-case basis. But households with at least one able-bodied person will be required to participate. Stone is tasked with overseeing the implementation of the program.
“This actual rent reform implementation has been about two years in the works of development, working with a consultant, analyzing other plans and coming up with our own,” Stone said.
Here’s how it works: In the first year, rent will be based on family income. In years two through five, they’ll be responsible for more and more of the rent. After year five, they can stay in their housing but won’t qualify for any assistance. They can go back onto the waiting list, but they’ll have to back to the bottom of the list.
Stone says renters will also get help from something called the ‘family self-sufficiency program:
“They get case management. We offer them courses. In fact we’re in the building right now where the Anchorage family self-sufficiency classes take place. Right next to us is a computer lab. People can come in, work on their computer skills through an agreement with the University of Alaska,” Stone said.
The program is currently only offered in Anchorage and Juneau but the plan is to offer it statewide soon. Officials say the rent reform program will impact about 2,500 families statewide. More than half of those families are in Anchorage. Stone says the transition to rent reform will be a challenge, but in the long run it will be good for the state.
“Going into rent reform is just being good stewards of the federal funds. The fact that we’re facing some budget cuts helps us in our need to make these changes, looking forward I think we will realize some savings,” Stone said. “Initially it’s really just a break even. But it’s a more efficient way of managing the program as well as a way of encouraging people to go out and find employment and become more self-sufficient.”
In Bush communities like Bethel and Nome, where there’s a severe lack of affordable housing, low vacancy rates and low-incomes, Stone says, AHFC is considering a hardship extension after the five years are up.
The program begins statewide next year in April.
People living in public housing and those receiving vouchers will be informed of how rent reform will impact them, by mail, in the coming weeks.