The Real Estate Board of New York to The General Welfare Committee concerning Rental Assistance Eligibility Requirements

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Thank you, Chair Ayala and members of the General Welfare Committee for the opportunity to testify on a slate of bills regarding the expanded eligibility of the CityFHEPS Rental Assistance program.

REBNY shares the Council’s goals of identifying opportunities to expand housing access, particularly for the most vulnerable populations. Rental assistance or voucher programs are a proven cost-effective method of ensuring people can stay in their homes and access new ones if preferred. REBNY continues to advocate for voucher assistance programs and the importance of long-term investments to help support housing access and stability. For instance, in 2021, REBNY strongly supported the passage of Intro 146-2018, sponsored by former General Welfare Chair Stephen Levin, which allowed for rent supplements paid through CityFHEPS vouchers to better reflect fair market rents. REBNY was pleased to see the passage of this bill in the previous Council session as well as the continued effort to expand those eligible for housing vouchers by expanding the income and employment eligibility requirements. REBNY hopes to continue to work with the Council to identify opportunities to reduce homelessness and keep New Yorkers stably housed.

With this said, City voucher programs, and CityFHEPS in particular, have faced administrative challenges. Last year, REBNY advocated for additional investments for staffing in the FY2023 City budget to help facilitate the processing of vouchers through NYCHA and HPD. For FY2024, continued investment and streamlining of these programs is very much warranted. Specifically, improvements to the CityFHEPS voucher program should include reducing inspection and approval times, increasing staff and staff retention within the agencies, creating tools for greater visibility between tenants, owners, and case managers, and amending policies such as rent reasonableness.

First, REBNY believes that CityFHEPS could be more successful if attention is paid to making the program more intuitive to prospective tenants and those assisting with housing access. Unfortunately, the ability to utilize vouchers has become increasingly difficult for all parties involved. REBNY frequently hears from members who are working with prospective tenants who are eligible for and/or utilizing vouchers that the process has proven cumbersome, lengthy, and convoluted. Time sensitivity has been particularly lackluster. In many instances, apartments have been lost for no reason other than processes that should take no more than a few days, ended up taking months. As can be imagined, property owners – many dependent on rent rolls – often do not have the ability to wait unnecessarily for excessive periods of time while the process is unfolding.

Looking additionally at unit inspection processes, REBNY believes more flexibility is needed to allow for reasonable judgement calls to be made without sacrificing life and safety needs. The current structure results in far too many failures for minor issues with the result of longer shelter stays. For example, our members have shared that units have failed inspection due to a two-degree variation over or under the targeted hot water temperature or one bedroom within a 3-bedroom apartment being 2 inches under the minimum. Minor failures that would not result in poor living conditions should not impact whether a family moves into an apartment or is sent back to a shelter. Instead, caseworkers should have the autonomy to make “common sense” decisions to pass or fail an inspection, within a set range for issues unrelated to life and safety concerns where the space meets code requirements related to bedroom size, heating, and cooling temperatures, and other essential prerequisites to quality and safe housing. Of course, more significant issues such as evidence of rodents, complete lack of heat, evidence of lead paint and the like should continue to result in a failed inspection.

Furthermore, inspection times need to be reduced and resources need to be boosted within the agencies to speed up application approval times. From the time an application is approved by the landlord, move-ins should be a maximum of 30 days. REBNY believes that there are ways to streamline this, including potentially creating a digital portal that works across all vouchers that can foster communication between tenants, owners, managers, and caseworkers. All documents could be updated to the portal, modernizing the lengthy application process that currently exists.

Lastly, the CityFHEPS rent reasonableness policy has exacerbated this complicated process. The established worth of a CityFHEPS voucher often does not reflect the market value of apartment units, and it is apparent that the formulaic process does not consider broad enough market data. In addition, what has been determined to be a reasonable rent has often fluctuated throughout a process, creating even more complications. For instance, REBNY members have been told that an asking rent meets the established rent payment standard only to be asked to lower the asking rent at a later point in the process under the guise of “rent reasonableness.” Similarly, tenants are often denied housing due to individual case workers determining that the rental rate is too high for a particular unit without taking into consideration amenities, location, and other considerations for rent value. As a result, this policy only undercuts the work done to raise the voucher values to fair market rent, and the work of the administration to offer augmented rent value so that voucher holders have more choices to live in a broader range of neighborhoods. While REBNY believes policy should be established to reflect data and market values, rent reasonableness should not be determined at the discretion of a caseworker.

Below are more specific comments on the individual bills being heard today.

BILL:T2023-2862

SUBJECT: This bill would prohibit the Department of Social Services from requiring an individual or family to reside in shelter before becoming eligible for CityFHEPS rental assistance voucher.

SPONSORS: Councilmember Ayala

REBNY supports this legislation and believes that vouchers and direct rental assistance are the most effective way to provide people with access to housing and subsequently keep them housed. In the past, REBNY has advocated for the removal of the 90-day qualifying shelter requirement for a CityFHEPS voucher and will continue to stand with the Council in calling for the removal of this requirement. Removing administrative barriers that lengthen shelter stays, and moves intervention upstream, is necessary to reduce the number of tenants remaining in city shelters and to help support housing access and stability for those in need.

BILL: T2023-2863

SUBJECT: This bill would remove the current requirement that an individual or family demonstrate they are employed to become eligible for a CityFHEPS rental assistance voucher. The bill would additionally change the maximum total gross income for eligibility for a CityFHEPS rental assistance voucher from 200 percent of the federal poverty level to 50 percent of the area median income.

SPONSOR: Councilmember Sanchez

REBNY supports this legislation. Over the years REBNY has supported rule amendments that increased eligibility to the CityFHEPS program by reducing the number of hours families are required to work and that have expanded the eligibility to those working full-time and earning up to 200 percent of the poverty level. Further expanding the eligibility to those earning up to 50 percent of the area median income ensures income eligibility is consistent with other programs, such as Section 8, and will ensure the program is as helpful as possible to a larger number New Yorkers.

BILL: T2024-2864

SUBJECT: This bill would remove certain criteria that the Department of Social Services (DSS) currently uses to determine whether a household that is neither living in shelter nor experiencing street homelessness is eligible for a CityFHEPS rental assistance voucher. Specifically, the bill would disallow DSS from using the preservation of a rent-controlled apartment or receiving adult protective services as a criterion to determine eligibility for CityFHEPS. Additionally, the bill would provide households with the opportunity to demonstrate risk of eviction with a rent demand letter to meet eligibility for CityFHEPS.

SPONSOR: Councilmember Sanchez

REBNY supports this legislation. The eviction process is a time consuming, costly process which entails requiring the petitioner to file a predicate notice, wait a designated period, serve, and file court papers, go through a lengthy, expensive court process, secure a judgement, and obtain an eviction warrant. While eviction warrants are the result in less than ten percent of cases, it is still noteworthy that 80% of filings are related to nonpayment, with a median rent owed of less than $7,000, a fraction of what it costs for a household in shelter. REBNY believes that it likely will almost always be a better investment to try and keep a family in their existing home via the utilization of a voucher, rather than front the costs associated with a family entering the shelter system. Of course, doing so also allows for the continued benefits and stability of being permanently housed in lieu of the often-tragic upending families experience if forced to enter homelessness.

As part of Project Parachute, REBNY supported the recommendation to waive the requirement for Housing Court proceeding or eviction filing for CityFHEPS eligibility. Allowing a household the opportunity to demonstrate risk of eviction as evidenced by a rent demand letter, bills, or other materials from the landlord that show monthly rent breakdown and rent owned, a signed affidavit, or mediated agreement between tenant and landlord initiated in lieu of eviction proceedings should be sufficient evidence and reason to attain eligibility for a voucher. Indeed, all parties should be spared the expensive and lengthy process of an eviction proceeding to receive the support needed.

BILL: T2023-2865

SUBJECT: This resolution calls upon the New York state legislature to enact legislation that would expand eligibility for the CityFHEPS program in New York City.

SPONSORS: Councilmembers Sanchez and Hanif

REBNY supports this resolution’s aim of encouraging the expansion of eligibility for the CityFHEPS program to include additional vulnerable populations. REBNY believes that there are several ways to address this need, including through the proposed Housing Access Voucher Program (HAVP), which seeks to fill the gaps in existing rental assistance programs, structured like a permanent, statewide Section 8-like rental assistance program.

HAVP is designed to be maximally accessible, flexible, and non-discriminatory, making it the most cost-effective program for moving homeless households into permanent housing. Enabling additional and more effective use of rental assistance will expand housing choice for New Yorkers across neighborhoods and requires state action for the City to move forward.

Thank you for the consideration of these points.