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Council approves staff study of pilot to help tenants with weak rental histories secure leases
Summary
Councilmember Paul Cunningham secured direction for staff to design a pilot program that would backstop landlords and reduce move‑in barriers for residents exiting shelter. The ‘HOUSE’ pilot (Housing Opportunities and Urban Support Experiment) is to return within 90 days with legal, funding and operational details.
Councilmember Paul Cunningham briefed the council May 6 on a proposed pilot to help residents with income but no rental history — often those moving from shelters or transitional housing — obtain market-rate leases. Cunningham framed the program as a three‑party agreement between tenant, landlord and the city that would reduce move‑in costs and provide training and wraparound services to support tenancy.
How it would work: Under Cunningham’s proposal staff would act as a limited guarantor (not a traditional cosigner) that reimburses landlords for a capped amount if a new tenancy fails due to unpaid rent or damage. Applicants would complete tenancy-readiness classes, financial counseling and be enrolled in low‑income utility and internet programs where applicable. The pilot would cap participation to 40 households and limit payments to landlords (worst‑case exposure estimated by the sponsor at roughly $104,800 for the entire pilot).
Legal and funding constraints: The city attorney warned the council that the municipal “gift clause” and federal grant restrictions create legal limits on how the city may guarantee payments or provide backstops, and that the source of any funds (city general fund, ARPA, or federal housing dollars) affects the legal analysis and allowable structure. Housing and Community Development staff suggested third‑party models run elsewhere — for example Phoenix’s Threshold program — as precedents staff will study.
Council action: The council voted unanimously to direct staff to design the pilot and return with a 90‑day report on legal, funding and operational parameters. Cunningham said he planned to seed the effort from discretionary ARPA dollars in his office and expected the worst‑case city exposure to be limited; staff will advise on acceptable funding sources.
Why it matters: Local providers and shelter operators said the pilot could reduce shelter stays and the administrative friction that prevents people from moving from emergency shelter to permanent rental housing. The program is explicitly a pilot: the council limited initial scale (40 units, 10-unit cap per landlord) and asked for a detailed legal and funding plan before committing city funds.
