Shannon first started using a Section 8 housing voucher after brain surgery that forced her to quit her job at a call center in Fort Collins, Colorado, 15 years ago.
The single mother of a 5-year-old daughter, Shannon saw the voucher — which provides rental assistance for low-income families seeking housing in the private market — as a golden ticket to a clean home with working appliances, which she had struggled to afford on her small monthly disability check and money from occasional temporary jobs.
“I thought I would finally be able to move to a place that would be a decent place, not like typical low-income housing,” she said. “My daughter was young, and I thought, ‘To have a yard — this would be so great.’”
But since becoming eligible for the program, Shannon, who now lives in Excelsior, has struggled to find apartments in both Fort Collins and the Twin Cities metro that fulfill her income requirements and desires for cleanliness and space. (She requested we not use her last name out of fear that speaking publicly will diminish her chances of securing a new place to live.)
Now Shannon has new hope; she’s on a waitlist to lease a new one-bedroom apartment in a complex now under construction in Eden Prairie — a site that has on-site laundry, underground parking and is closer to family than her current home. The problem: Dozens of other Section 8 voucher-holders are also on the waitlist for the same apartment.
That type of competition has become common across the Twin Cities metro area, a sign of the high demand for affordable housing that goes beyond just Minneapolis and St. Paul at a time when the region’s building boom has largely targeted residents who can pay market rates.
Now, housing advocates and officials across the metro are boosting efforts to raise awareness of the need for Section 8 housing, including attempts to recruit more landlords who will accept the vouchers. “When occupancy rates are as high as they are right now, owners don’t feel as obligated to rent to somebody that has some type of rental subsidy,” said St. Louis Park housing supervisor Michele Schnitker, so the city has had to find ways to partner with landlords. “We’ve been successful in that.”
Across the country, the U.S. Department of Housing and Urban Development (HUD) determines the number of vouchers and the size of rental subsidies available in different communities, calculations based on median rents and wages. (Once someone qualifies for a voucher he or she can only redeem the certificate within the geographic bounds of the housing authority that issued it to them.)
The more affluent suburbs of the Twin Cities, such as Chanhassen, Chaska, Eden Prairie and Edina, have the highest payment standards for Section 8 vouchers, ranging from $1,005 for a one-bedroom unit to $2,740 for a six-bedroom apartment, according to HousingLink, a Minneapolis-based nonprofit that tracks housing vacancies and wait-list openings. Bloomington is on the other end of the payment spectrum, with a payment standard of $890 for a one-bedroom to $2,120 for a six-bedroom apartment.
That criteria helps level the playing field for different housing authorities in terms of recruiting property owners. “It’s not like landlords are more willing in the suburbs or landlords are more willing in the city,” said Josh Dye, a spokesman for HousingLink. “You’ll find willingness and unwillingness in both … the payment standard eliminates the willingness conversation.”
Not keeping up
Yet the payment system is not keeping up with the region’s quickly evolving housing market, said Eric Hauge, executive director of HOME Line, a nonprofit that offers legal advice and advocacy for tenants. On an annual basis, each area’s housing authority recalibrates payment standards based on market trends from the year prior, which means the criteria do not reflect new rent hikes.
“In general, the worth of vouchers in both the suburbs and core cities are not keeping up with rising rents,” Hauge said. “The voucher payment standards are supposed to keep up with the rent, but there’s been a delay. … As rents go up on a much faster basis, the people are getting priced out with their vouchers.”
Part of the problem is the persistently low vacancy rate across the Twin Cities. According to the Metropolitan Council’s Housing and Redevelopment Authority Director Terri Smith, the current vacancy rate is 3 percent metrowide — and 1 percent for Minneapolis and some suburbs. For perspective, the national average rental vacancy rate is about 7 percent, per 2018 HUD data.
Complicating matters for low-income renters are the varying types of supply by area. In general, the cities of Minneapolis and St. Paul have more high-rise rental apartments for low-income tenants, as well as greater diversity of housing types, making for concentrated areas of homes available to low-income tenants that aren’t as prevalent in the suburbs.
At the same time, the number of residents living in poverty has increased faster in the suburbs than in Minneapolis-St. Paul. Suburban communities such as Brooklyn Park, North St. Paul and Oakdale now have large disparities between the number of cost-burdened households who live there and the availability of affordable housing. (Housing experts consider a household to be cost burdened if members of the household spend more than about one-third of their monthly income on housing.)
For low-income renters in the suburbs, the competition for housing is exacerbated by the loss of what’s often referred to as NOAH (for naturally occurring affordable housing), as more and more outside investors remodel old apartment complexes to attract higher-income tenants. The trend to convert such units has prompted a slew of new initiatives by cities to try to preserve as much NOAH housing as possible in future years.
An increased cost for labor, construction and land has also changed the market and created new challenges for what Dye calls, “mom and pop” landlords, who are generally more willing to accept Section 8 holders or have relatively loose screening requirements for renters who may have poor credit, for example.
“A lot of new construction in the private market and in even affordable housing is not for people in poverty — it’s not for people with extremely low incomes. It’s hard to get those [housing for people at the lowest end of the market] financed,” Dye said. “We’ve always had a shortage in this lower end, and it just kind of continues to get worse.”
The extent of the problem became apparent in June, when the region’s three biggest public housing agencies — Smith’s Metro HRA and the authorities for St. Paul and Minneapolis — opened their waitlists for Section 8 vouchers simultaneously. The hope was that the coordinated effort would increase the chance for eligible households of getting access to the program, and roughly 45,000 households applied for just 7,500 spots on the lists. The housing authorities’ computer-run lottery system will select who will get vouchers from the lists over the next several years.
“The need for rental assistance is clearly so much greater than the number of vouchers that any of us three [housing authorities] have,” said Louise Seeba, who helps lead the St. Paul Public Housing Agency. “Clearly the need is there for much, much more, and we’re doing everything that we can to be as efficient with our vouchers and have them placed.”
A push to recruit more landlords
In recent years, outside developers have found St. Louis Park an ideal location for building new housing that gives people a city-like experience without some of the same city-like expenses, according to Schnitker, the city’s housing supervisor.
But that upscaling has taken a toll on options for low-income renters. To address the problem, the city’s housing authority has a staff person who serves as a point of contact for maintaining relationships with landlords who could be eligible for running subsidized housing, hoping they eventually accept Section 8 vouchers.
“We’re at a bit of an advantage because we have a housing authority that administers the voucher program,” unlike suburbs that have Section 8 administered by regional authorities, such as Metro HRA, Schnitker said. “Because of that we’re able to cultivate a really good relationship with our landlords.”
That push to recruit new landlords isn’t confined to St. Louis Park. Smith, of Metro HRA, said that in her 25-year career, she has never seen such a concerted effort among housing authorities and nonprofits to expand the pool of those accepting vouchers and help them manage Section 8 properties.
Yet some advocates want cities to go beyond outreach. In 2017, the Minneapolis City Council approved an ordinance that requires property owners to accept Section 8. Property owners challenged the notion in court, arguing that state laws preempt the change and maintain their rights to picking tenants, though the Minnesota Court of Appeals ruled in the city’s favor last month.
Nonprofits are also trying to help connect more low-income renters and property owners. Jaime Stampley, housing services director at Lutheran Social Services of Minnesota, said the organization maintains a database of property owners who have expressed any type of willingness to take vouchers. They also keep track of documents for renters and serve as a liaison to landlords. “If you miss that one peice of mail, you could miss the chance of a lifetime,” she said of people who sign up for the Section 8 waitlist.
For Shannon, who wants to use her voucher in Eden Prairie so that she can be closer to a sister who often takes her to medical appointments, the search for better housing remains ongoing. She learned of an ideal housing opportunity while reading a story in her local newspaper months ago. Immediately after reading the news story, she filled out paperwork and paid the application fee for a spot in the new Eden Prairie building, which hasn’t opened yet, hoping she would get on top of the waiting list. Her promptness initially seemed to have paid off — she passed the initial screening for the unit — but she said she is still waiting on the final word from the property owner, as the two parties negotiate timelines for moving in and payments.
“I feel like I’m just constantly having to struggle. I’m constantly having to fight,” she said of her search. “I just get so tired sometimes. I don’t want to deal with the battle.”