The Administration says that housing agencies will be able to serve more people under its block-grant proposal despite the very large funding cut. How is that possible?
It would not be possible unless housing agencies sharply reduce the value of each voucher. Housing agencies could implement the proposed cut without reducing the number of families assisted, but they would then have to impose extremely deep cuts in other ways. For example, agencies could make up for the entire $1.6 billion cut by raising each voucher household s annual rent by an average of about $850 in 2005 and $2,000 by 2009 (or by achieving the small amount of savings that could be obtained through other means and imposing somewhat smaller rent increases).[3] Theoretically, agencies could go a step further and actually increase the number of families served by raising rents even more sharply. But rent increases on this scale would force families to divert money from other basic needs to pay for housing, and many of the poorest families would be unable to find any housing they could afford with the shrunken voucher subsidy. The Administration s portrayal of such a scenario as an exp
