Vermont housing authority warns possible federal cuts could remove about 700 housing vouchers

Kathleen Burke, executive director of the Vermont State Housing Authority, told the House Committee on General & Housing on Jan. 15 that a possible reduction in federal funding for the Housing Choice Voucher program could force Vermont to remove about 700 vouchers during the year, cutting rental assistance for hundreds of families.

Burke told the committee the state authority administers the largest portfolio of federally funded Section 8 rental subsidies in Vermont and “touches over 8,500 Vermont families with rental assistance benefits.” She said that about 6,000 Vermont families are served specifically through the Housing Choice Voucher program.

The nut graf: the Housing Choice Voucher budget is set in Congress, and a shortfall would translate to fewer vouchers in use and fewer new offers to waiting lists — with ripple effects on ongoing affordable housing projects where the authority has made project-based voucher commitments.

Burke explained that the agency is a quasi-state instrumentality that administers federal programs but does not receive a direct legislative appropriation. “We are not a state agency or a department of state government. We are referred to as a quasi state agency,” she said, and noted that many of the authority’s programs — HUD Section 8, Continuum of Care, and USDA Rural Development programs — “are funded by acts of Congress.”

She told members the U.S. Department of Housing and Urban Development advised public housing authorities in early December to “plan as if we will receive 97.5 percent of what we actually need to administer the Housing Choice Voucher Program,” and that the department also discussed a scenario as low as 88.8 percent. Burke said that at 97.5 percent funding, Vermont would need to remove roughly 700 families from the state’s Housing Choice Voucher program over the remainder of the calendar year to keep spending in line with the reduced allocation. “So what that means is 700 fewer families receiving rental assistance,” she said.

Burke described concrete program impacts: project-based voucher commitments that help close financing gaps for new developments could be jeopardized if the authority must take vouchers offline. She also described the administrative-fee model for the Housing Choice Voucher program: the authority earns an administrative fee for each leased voucher, and taking vouchers offline reduces that revenue. “If we have to take 500 vouchers offline over the course of the year, that’s $50,000 — that’s a position,” Burke said, linking reduced federal funding to potential staff cuts and diminished capacity to operate programs.

Beyond Section 8, Burke briefed the committee on state-administered grants the authority manages in partnership with state agencies, including the Rent Arrears Assistance Fund, a landlord relief risk pool intended to encourage owners to rent to households using subsidy, a Mobile Home Improvement and Repair program, a Rapid Response Mobile Home Infill initiative with the Agency of Transportation, a Housing Subsidy Plus Care program run for the Department of Mental Health targeted at people exiting institutions, and a small transitional housing assistance grant administered for the Department of Health. She also described HOPWA (Housing Opportunities for People with AIDS) activity and project-based voucher commitments for specific developments referenced in prior testimony.

On legislative priorities, Burke asked the committee to support full funding for the Vermont Housing and Conservation Board, continued funding for the rental arrears prevention program (which she said may run out of money by September under current spend), continued base funding for mobile home programs, and ongoing funding for the mobile home infill program. She said detailed slides and a written narrative were available to committee members.

Burke concluded by urging the committee to monitor federal budget developments closely and signaled willingness to return with more detail.

Ending: the committee did not act on proposals during the hearing; Burke offered to provide further information and contact details and the committee scheduled additional housing-related witnesses later in the day.