By Lolly Bowean
For the first time in more than five years, the Chicago Housing Authority has opened its waiting list and is issuing housing choice vouchers to 3,000 new residents who need help paying their rent, officials with the agency said.
But while the expansion of the housing choice program is being hailed by some as good news, a local, independent think tank is releasing a report Wednesday alleging that over the same five years, the CHA has steadily socked away hundreds of millions of dollars instead of spending the money to house the poor.
According to the Center for Tax and Budget Accountability report, the CHA issued an average of 13,534 fewer vouchers than it could have each year from 2008 to 2012. So although the agency managed about 36,000 families on the program during that time, there were still thousands of others who did not get served, the report shows. In November, the CHA had a waiting list of more than 40,000 families for both vouchers and public housing, records show.
The agency had been saving an average of $90 million a year from 2004 to 2012 by not issuing vouchers, the report says. The CHA spent some of that money on other housing-related expenses, debts and obligations, and what was left over was put into reserves, which by 2012 totaled $432 million, according to the center’s analysis.
In response to a list of questions from the Tribune, the CHA issued a statement that disputed the report’s tally of its reserves. The CHA says it currently has $355 million saved, a portion of which it intends to use on “a host of development projects” while keeping another portion for operating reserves.
The CHA agreed, however, that it has not issued all the vouchers the U.S. Department of Housing and Urban Development allows, saying it has instead used some of the voucher funding to pay for life safety measures in some of its properties and to pay for educational and workforce initiatives to help the residents reach self-sufficiency. Its spending strategy has been approved by HUD, an agency spokesman said in a written statement. But the CHA has recently issued more vouchers to meet the growing need, officials said.
“CHA has the flexibility to use financial resources for vouchers or for other housing activities, such as development and capital projects,” agency CEO Michael Merchant said in a statement. “We will continue to forge ahead with our development plans; however, due to the great housing needs that exist, right here, today, I have elected to make more vouchers immediately available.”
Unlike many public housing agencies, the CHA is uniquely classified by the federal government as a “Moving to Work” agency. That designation gives the CHA the authority to use federal funding from HUD to issue vouchers or pay directly for public housing. Under HUD rules, the agency can also reallocate the money to pay for social service programs, capital spending and initiatives it deems fit its mission, without in-depth explanation.
But while the agency’s management of its money and programs may be legal, the choice of spending elsewhere — or not spending at all — federal dollars that could be used for housing vouchers is disturbing to advocates and activists who say the CHA could work harder to end homelessness and help the poor.
“There is a big concern about what is going on with the finances,” said Amanda Kass, the budget director and pension specialist for the Center for Tax and Budget Accountability. “We really hope our report raises awareness and generates some discussion. Maybe it could lead to more clarity and transparency on the policy decisions being made.”
In addition, the agency’s reporting of its budget and income is so complex, it is difficult for leaders, officials and residents to understand how federal tax dollars are being managed, Kass said.
“The problem is that it’s not transparent that the money is being placed in reserves,” Kass said. “You have to really be able to dig to figure that out. The general public may not even know that CHA has built up this reserve fund.”
Commissioned by the Chicago Housing Initiative to research the CHA’s numbers, the Center for Tax and Budget Accountability spent about six months poring over financial documents and records to come up with its figures, Kass said. In order to analyze the agency’s spending, experts had to sort through four separate reports the CHA issues annually, examining spending line item by line item, Kass said.
The center’s report, titled “A Fiscal Review of the Chicago Housing Authority,” is being used to push for more city oversight of the agency, said Leah Levinger, director of the Chicago Housing Initiative, an advocacy group that pushes for decent housing and stable communities for low-income residents.
“We are urging City Council to step in and oversee CHA,” she said. “We are pushing them to establish performance guidelines and demand full voucher use, since HUD isn’t doing this. The city should see this is a housing authority that underperforms. Federal deregulation has been a massive failure. Someone needs to be minding the store and holding the agency accountable.”
For years, the CHA has been criticized for the way it implemented its Plan for Transformation, which was supposed to remake the face of public housing in the city. That plan led to the demolishing of dozens of public housing complexes, but the plan has lagged behind on its completion date.
This new report, however, examines the voucher program that served some former public housing residents in addition to the thousands of working poor who could not afford market-rate rent in the city or in Cook County.
In the past, the program has been criticized because the agency has struggled to find private housing in some of Chicago’s more affluent and racially diverse communities. Residents who have the vouchers tend to be concentrated in poor, struggling neighborhoods.
Just this week, the CHA came under scrutiny for its creation of “super vouchers,” which pay for poor residents to live in exclusive, luxury high-rises downtown, where rent can start at $2,300 a month and go higher, according to one public official.
Because of that voucher program — which the CHA says serves 706 families, less than 2 percent of the agency’s voucher portfolio — Republican U.S. Rep. Aaron Schock of Peoria has called for an investigation to ensure the program is not wasting tax dollars. Spending thousands on rent for one family ultimately denies other families the chance at housing in more affordable areas, Schock said in statements.