Source of rental income legislation premature in Baltimore
Baltimore City Council’s proposed bill 18-308, “Housing Discrimination — Source of Income,” would force landlords to rent to Section 8 Housing Choice Voucher tenants, which involves compelling landlords to enter into a contract with the Housing Authority of Baltimore City and the Federal Department of Housing and Urban Development.
Since its inception in 1974, this federal voucher program relied on voluntary participation by landlords who agree to provide housing within the program’s guidelines. A recent Johns Hopkins University study found that while landlords like the reliable rent payments that a federally funded voucher program provides, many are frustrated with the required inspections and disappointed with how local housing officials handle disputes with tenants. Contrary to tenantadvocates’ claims that housing providers refuse voucher recipients for discriminatory reasons, an Urban Land Institute study found that most landlords do not accept vouchers because of the difficulty of administering the program. While race-based housing discrimination has not been eliminated, my analysis of an Urban Institute study shows a 90 percent reduction in racial housing discrimination since 1977.
Rental property owners come from diverse backgrounds — retirees looking to supplement their retirement income, nonprofit heads hoping to boost their incomes, inner city entrepreneurs seeking a better life than that offered by the drug trade. A decision to purchase rental housing is not haphazard. Some, for example, plan to own housing units near a college or university and like the idea of providing housing for students. Others find opportunity near employment centers, where they can provide affordable workforce housing. Others target neighborhoods near military bases to house the military.
In each chosen specialty, the landlord learns the nuances of providing amenities, features and a management structure that caters to the particular needs of the customer base without regard to race, religion, sex or other protected class.
According to Baltimore Housing’s website, the Housing Authority “partners with over 3,000 landlords to provide affordable, decent, safe, and sanitary housing for Housing Choice Voucher Program (HCVP) participants,” providing housing for more than 13,000 voucher recipient households in Baltimore City. These 3,000 landlords have chosen a business model to provide housing to voucher recipients that includes the temperament to interact with the participants, the office staff, repairmen, system, and procedures to efficiently operate within the rules and bureaucracy of the HCVP.
If Council Bill 18-308 passes, unwilling housing providers will be compelled to sign a 12-page lease addendum with provisions dictated by HUD or be subject to lawsuits for housing discrimination.
Participating landlords agree to make their rental units subject to the Housing Quality Standards (HQS) inspections. A Housing Authority inspector visits the rental unit before the tenant moves in to make sure every item on the 30-plus point HQS checklist passes before the tenant is authorized to move into their unit. No matter how minor the violation or deficiency, every item on the HQS inspection must be repaired. The unit is re-inspected by another Housing Authority inspector who can impose additional repairs at the inspector’s discretion. We all agree that inspections are necessary. Baltimore City’s new inspection program includes a list of 12 critical components to safe housing. The HQS list is more than twice as long.
Baltimore City’s new inspection rules reward “good landlords” with inspections once every three years, while HQS inspections occur every year. No matter how minor, even if the damage was caused by tenant abuse, rent payments are stopped until the HQS repairs are completed. Restoring rent payments is often held up by bureaucratic delays.
In the eight weeks it takes from the time a voucher recipient identifies a home to when the payment is approved and the tenant actually moves in, the landlord is not receiving rent and the home is vacant, creating an eyesore on the block and subjecting it to vandalism.
The website GoSection8.com provides free advertising for any landlord wanting to rent to voucher tenants. At this writing, more than 1,700 homes in Baltimore City and 400 homes in Baltimore County are posted by landlords who voluntarily want to participate in HCVP, suggesting there is no shortage of homes available for subsidized tenants.
If the stated goal is to increase rental homes offered to HCVP recipients, the city should make the existing program more efficient and user friendly. Legislators, meanwhile, should delay action on “Source of Income” legislation until after the Federal Task Force studying ways to increase landlord participation finishes its work.
Ben Frederick III (benfrederick.com) is a Baltimore City resident and real estate broker specializing in apartment properties.