Skip to comments.Poor families use 'supervouchers' to rent in city's priciest buildings
Posted on 07/28/2014 7:04:53 AM PDT by afraidfortherepublic
The high-rise at 500 N. Lake Shore Drive is the second-most expensive in the city, with rents for a one-bedroom apartment approaching $3,000 a month, well beyond the reach of most Chicago residents.
But that's not too much for the Chicago Housing Authority, which has used federal tax dollars to pick up most of the tab for four lucky residents in the year-old building, with its sweeping views of Lake Michigan, a concierge and a dog-grooming center.
The tenants moved in over the past two years as part of a push by the CHA to expand its housing voucher program so that more low-income residents can leave the city's roughest neighborhoods and start a new life in places with low poverty and crime and close to good schools and jobs.
Yet some landlords say it's a mistake to use scarce tax dollars to pay ultra-high rents for a fortunate few when more than 15,000 people sit on the CHA's voucher waiting list.
This is nuts, says landlord Tony Rossi, president of Chicago-based RMK Management Corp., who describes himself as a liberal Democrat. In a situation where you're dealing with a low-income person, do they really need a 25th-floor apartment with a lake view? It just doesn't make sense to me.
It doesn't make any sense to U.S. Rep. Aaron Schock, either. The Peoria Republican last month pushed a measure through the House to curb the payments and says he is seeking an investigation by the inspector general of the U.S. Department of Housing and Urban Development, which pays for the voucher program and sets many of its rules.
This is about making sure that people are not abusing the system, he says.
The CHA says in a statement that the exception payments for high-cost apartments cover less than 2 percent of the authority's roughly 38,000 outstanding vouchers. The higher paymentsknown as supervouchersare necessary to help low-income residents move into better neighborhoods, which have few affordable housing options, the authority says.
Most landlords agree with the effort to expand the use of housing choice vouchers, formerly known as Section 8 vouchers, to more prosperous parts of the city. Vouchers have become a bigger part of the CHA's policy since it tore down big public housing projects like Cabrini-Green, offering recipients more flexibility to choose where to live so they can escape the cycle of poverty.
Under the voucher program, which is federally funded but run by local agencies like the CHA, an eligible resident can rent an apartment in a privately owned building. Voucher holders generally must pay up to 30 percent of their monthly income, if they have any, to cover rent and utilities, with the CHA picking up the rest. HUD caps how much the CHA can pay a landlord. A few years ago, the CHA could not pay more than 110 percent of a fair market rent calculated by HUD. The current fair market rent in Cook County for a one-bedroom apartment is $826 a month.
But HUD allowed the CHA to change its rules in 2010, pushing the cap up to 300 percent in designated opportunity areas, such as downtown and Lakeview, where poverty is low and subsidized housing is scarce.
Raising the threshold was essential because rents are so much higher in opportunity areas, making them off-limits under the old restrictions, says Alexander Polikoff, co-director of public housing at Business and Professional People for the Public Interest, an advocacy group.
It was from a good motivation and a sound policy reason, he says. The CHA is to be commended for being one of the only housing authorities in the country that understands the idea of housing mobility.
The CHA has approved 706 supervouchers since HUD signed off on the higher limits, and the number has jumped in the past two years. The CHA approved 364 in the first half of the year, up from 291 for all of 2013, 44 in 2012 and seven in 2011, according to the authority. Eighty-seven payments exceeded 200 percent of HUD's fair market rent in the first six months of the year, versus 49 for 2013 overall.
Eleven leases hit the 300 percent cap in the first six months of 2014, up from three for last year, according to the CHA. High-end apartment buildings with the highest voucher payments included 500 N. Lake Shore Drive, Aqua Tower in Lakeshore East and the Streeter in Streeterville.
In the South Loop, the CHA is subsidizing three tenants at Amli 900, a 440-unit building at 900 S. Clark St.
Amli supports the efforts in a number of communities across the country in which we operate to provide affordable housing to qualified people, Greg Mutz, CEO of Chicago-based Amli Residential, which owns the building, says in a statement. Amli does not support the push to provide luxury rental housing to a lucky few when so many are on the waiting list for basic housing.
According to the CHA, 15,230 people were on its waiting list for housing vouchers at the end of 2013.
Even Mr. Polikoff, who supports the CHA's broader push, says subsidizing low-income residents in ultra-high-rent buildings is an inappropriate use of taxpayer money.
In its statement, the CHA says exception payments provide CHA families the ability to choose where they want to live and enjoy the great diversity that Chicago communities have to offer. A HUD spokesman declines to comment.
Some building owners are happy for the business. Justin Elliott, principal at Chicago-based Marc Realty Residential, has few complaints after the CHA approved supervouchers for 36 leases this year and last in a 96-unit building Marc owned at 2300 S. Michigan Ave. Marc recently sold the building, which had the most supervouchers by far among all properties, according to the CHA.
All in all, we viewed this as a very positive experience, Mr. Elliott says.
Still, the image of a person on public assistance living in a luxury apartment building could generate a political problem for HUD and the CHA.
In Washington, Mr. Schock's proposal would prohibit exception payments above 120 percent of an area's fair market value calculation. The measure is not expected to go far in the Senate.
Closer to home, Mr. Polikoff says CHA officials told him that the authority plans to lower the cap to 150 percent. The CHA won't confirm that, but its statement did not rule out a change:
As it does every initiative, CHA has and will continue to evaluate program impact and make adjustments as necessary to ensure it meets objectiveswith the ultimate goal of expanding housing options for families in a variety of Chicago neighborhoods.
ObamaJarrett hates “the suburbs” and will implement policies to destroy them and drive out people who like to live there.
This is nuts, says landlord Tony Rossi, president of Chicago-based RMK Management Corp., who describes himself as a liberal Democrat. In a situation where you’re dealing with a low-income person, do they really need a 25th-floor apartment with a lake view”
...where’s your tolerance and diversity you “liberal democrat” you? “Do they really need” is the mantra of these idiots. How does he know what “they need”? They played by your rules. So go pound sand Tony!
The CHA has approved supervouchers for low-income residents in some of the most expensive apartment buildings in the city.
500 N. Lake Shore Drive
The CHA has approved vouchers for residents in four apartments with rents ranging from $2,235 to $2,673 a month.
Move ‘em next door to Rahm, Valerie and Oprah. hee hee
Sounds good to me!
Well we movin on up... to the DEE-luxe apartment in the sky...
Chicago Housing Authority? Hmmm. Wasn’t a certain evil, corrupt advisor to the Pres_ent the Chairman of the CHA at one point? One might suspect she was attracted to huge opportunities for graft in directing vast sums of taxpayer money to open-handed political donors who just happened to have ownership interests in such swank digs. But that would be too cynical, wouldn’t it?
Ah. Yes. Your typical NIMBY DemocRAT. A NIMBYRAT.
He's the landlord. He gets the money either way. What difference does it make to him who the beneficiary is?
Unless he has a problem with certain poor people. Ahem.
As one of my vendors in New York told me, the winos and derelicts always manage to stay at the best addresses, even if it is by a steam grate.
One wonders if the beneficiaries of this largesse are FOO? (Friends of Obama)
Exactly my thought too. Liberals tell us to be compassionate for the poor and all that.
Where in the sam hill does he get off, saying what the poor “need” like that? Who the heck does he think he is????
Maybe it's the renovation costs once the "beneficiary" moves out? Maybe it's the complaints from other tenants about the noise and filth that the "beneficiaries" bring with them? Maybe it's the loss of rental income when other tenants move out?
In addition to following the money, I’d follow the relationships of the people getting these luxury grants to those processing them. There’s got to be some serious favoritism going on, as well as gross waste and incompetence. In other words, when there’s money to be wasted, there’s usually influence involved in the manner and the selection of people on whom it’s wasted.
The comments are worth checking out
The intent was to get these old people out of their houses and put in welfare recipients using vouchers.
This was an upper middle class neighborhood.
You know that will never happen.