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Subsidized Housing

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Introduction Federally subsidized housing provides affordable housing to "low income" people.  Low-income is defined as a household with income at or below 80% of the median income.  However, there are far more people eligible for these subsidies than there is money to be allocated. In Ann Arbor, almost 50% of all renter households pay more than 30% of their income towards rent.  But of the approximately 23,000 rental housing units in Ann Arbor, only roughly ten percent receive subsidies.  Furthermore, subsidized housing often has been built or administered poorly, resulting in unsafe conditions for tenants.

Below is a basic description of different types of government-subsidized housing in the Ann Arbor area. It explains how to apply for them, and how to advocate for better conditions.

 

Wait-list priorities  The Department of Housing and Urban Development (HUD) requires many subsidized housing units to be set aside for people considered "very low-income".  Following are examples of the 2003 income limits for "low-income" and "very low-income" households in Ann Arbor:

  • two-person: low-income is $45,200, very low-income is $31,100.
  • three-person: low-income is $50,850, very-low-income is $34,950.

There are very few subsidized units available for single people.  Available units are reserved for single people with disabilities or people at least 62 years old.

 

Income Certification After tenants move into subsidized housing, they are required to re-certify their income once a year with the management or subsidizing agency.  Their employer and/or the Family Independence Agency will have to verify their income.  If a tenant receives Section 8 and their income goes down, they can request an income re-certification in order to get a reduction in rent.

 

Discrimination You may be on a wait-list for more than one subsidized housing program at a time.  Tenants should call the program offices regularly to check on their status on the wait list.  If you are sitting on a wait list much longer than originally estimated and you suspect discrimination, contact the Fair Housing Center of Southeastern Michigan (734-994-3426 or 517-263-1777).  Also, contact government agencies that oversee the administrating office.  You can send complaints to local politicians and ask them to investigate the situation.  Tenants can file Freedom of Information Act requests if they suspect that information about the administration of federally subsidized housing is being withheld.

As with all housing problems, it is important to document your interaction with different administrators and politicians.  Consider using the media to put public pressure on the owner or agency.  The Fair Housing Center will investigate discrimination claims with testers, or refer you to an agency that does so in your area.  Also, check to see if there is a Human Rights Department in your area whose task it is to investigate human rights violations complaints. In Ann Arbor, call the Human Rights Department (994-2762 or 994-4856).

 

Section 8

Section 8 Vouchers for Private Market Housing A Section 8 rental subsidy is a federal payment to a landlord on behalf of an individual tenant.  With a Section 8 voucher, the government pays the difference between 30 percent of the tenant's household income and the set "fair market" rent of the unit.

The tenant obtains a voucher for a fixed amount of money based on the geographic area.  If they decide to pay more than 30% of their income for rent, they may rent from a landlord that charges more than the "fair market rent" for the area.  

Unfortunately, the money available for Section 8 vouchers does not come close to meeting the demand for subsidies.  Applications are taken only sporadically and, when the wait list is open, tenants can expect to wait a fair amount of time before actually getting a voucher in their hands.

Once you are approved for a voucher, you will have 60 days to find a house in the area that meets Section 8 program requirements, and for which the landlord is willing to accept Section 8.  Sometimes it is possible to get an extension on the 60 days, but tenants sometimes have to return the voucher unused because they cannot find a unit that meets the requirements.

For information regarding Section 8 voucher programs in Washtenaw County, call:

Section 8 Government Subsidy of Developments  In subsidized housing, the federal government insures and usually pays a percentage of the mortgage.  The owner is required to pass on the debt-servicing savings to the tenants through reduced rents, sometimes in all the units of the building, sometimes in only a portion of the units.  The household pays 30% of its income for rent.  HUD subsidizes the owner to what they determine to be "fair market" rent.  (The 2004 fair market rent in Ann Arbor is $659/month for a one-bedroom apartment.)

Because of their affordability, Section 8 subsidized units are almost always rented.  Because of the subsidy, the landlord is guaranteed his or her profit. 

 

"Below Market Rate" Cooperatives  Five "below market rate" cooperatives are located in Ann Arbor: Colonial Square, University Townhouses, Forest Hills, Arrowwood, and Pinelake Village.  Co-ops are owned and managed by the people who live in them.  Income-eligibility, carrying charges (monthly "rent"), family composition requirements, and buy-in costs vary between cooperatives.  "Below market rate" co-ops are different than "market rate" co-ops such as Geddes Lake, which function more like condominiums.

Cooperatives are owned and managed by the people who live in them.  After being accepted into a cooperative, members buy a membership share that entitles them to lease a unit.  Shares are generally refundable at the end of the tenancy, less any damage and resale fees. In many of the co-ops, the initial buy-in costs have increased at a rate that prohibits many people from becoming tenants.  For example, the buy-in cost at Colonial Square in 1989 was $3200.  Area residents most in need of the low rent may not be able to afford the initial share.  However, if you can afford the buy-in cost, a cooperative can be an affordable alternative to the long wait-lists and large bureaucracy of other subsidized housing.  Also, check with management to see if they offer any assistance in paying the membership cost.

Landlord-tenant laws generally apply to the cooperatives. When repairs are not done, you often have the same right to withhold your carrying charges.  However, your membership share is not protected under the Security Deposit law.  It is important to check your membership agreement for costs (such as repainting) that may be deducted from your buy-in share, as well as other rules that may apply to your housing.  If you have questions about your agreement, you can contact Legal Services of South Central Michigan at (734) 665-6181. 

 

Public Housing  In public housing units, the city or township acts as the landlord, owning and maintaining the property. The wait list for Ann Arbor Public Housing units is often closed for a year at a time.  Tenants pay 30% of their income for rent. The Ann Arbor Housing Commission has  family units and 9 different locations and single units for couples, persons with disabilities, or seniors at 7 different locations.  For more information on Ann Arbor's public housing units, click here to view their web site or call 734-994-2828.

 

Getting Repairs in Subsidized Housing When your landlord does not respond to your written requests for repairs:

In Section 8 subsidized units, you can withhold your rent the same way that tenants in the private market do (See our information on Repairs and Maintenance).  Some city pressure can be applied by calling the city for an inspection to cite housing code violations.  Also, tenants can apply pressure through complaints to the Michigan State Housing Development Authority (MiSHDA), or the federal Department of Housing and Urban Development (HUD).

In Section 8 voucher tenancies, the withholding procedure varies depending on what agency issued your voucher.  Generally, you are expected to alert your Section 8 worker to the problem.  The unit will be inspected and the worker will give your landlord a certain amount of time to repair before stopping payments.  If your landlord refuses to make repairs, or if the unit has been condemned, Section 8 should stop payments. You will be given time to look for another unit without returning to the bottom of the waiting list.  You should be able to withhold your portion of the rent, although some caseworkers discourage or even prohibit it.  Also, some offices allow you to make repairs yourself and deduct the cost from your portion of the rent.  (See our information on Repairs and Maintenance.)

 

Family Independence Agency (FIA) Rent Payments In any type of housing, if rent is paid by the FIA, you still have the right to withhold rent when the landlord does not keep the house up to code.  It is important to document a history of notifying the landlord for repairs.  If the rent is vendored from FIA directly to the landlord, contact your FIA worker and tell her or him that you want payments sent to you instead.  FIA has rules that allow you to place rent money in the bank if you are taking positive steps to solve the problem. You can also cash the check and buy a money order with your and your landlord's names on it. Tenants should get the money orders at a bank versus a convenience gas/food store because you may not be able to obtain proof of the purchase from the gas/food store if a money order is lost or a landlord denies ever receiving it.

 

"Just Cause" Protection from Eviction The federal government allows public housing providers to evict tenants, or refuse to renew a lease, only when they have "just cause" (a good reason) to do so. In the private market, landlords do not have to give a reason if they decide not to renew your lease. 

Some examples of "just cause" are:

  • the tenant repeatedly refuses to comply with lease terms
  • the unit has been used for illegal purposes
  • there is excessive traffic or noise from the unit
  • the tenant has habitually paid rent late
  • the tenant has created a health hazard
  • the tenant has not adequately cleaned the unit

These examples can leave room for landlords to apply different standards to different tenants. If you live in public or subsidized housing and you have been given an eviction notice, you should call Legal Services of South Central Michigan at (734) 665-6181.  If you live in public housing, you have the right to a hearing in most cases and you need to request one in writing right away. 

 

Grievance Hearings for Public Housing Tenants If you live in Ann Arbor or Ypsilanti public housing, you have the right to a hearing in most cases before you can be taken to court.  A hearing will give you the opportunity to tell your side of the story.  The hearing officer recommends to the Housing Commission a possible resolution to the problem.  You should request a grievance hearing in writing as soon as you receive a notice to quit.  You may be able to avoid court or at least buy yourself more time before you are evicted.  Call Legal Services of South Central Michigan at (734) 665-6181 for assistance to prepare for the hearing.

 

Public Housing Tenant Associations In 1989, the Ann Arbor Housing Commission created a policy to recognize and negotiate with tenant organizations that represent the majority of tenants at each public housing site.  There are guidelines on how to get organization recognition, elect officers, create by-laws, and negotiate agreements with the Housing Commission.  The Housing Commission is also expected to provide some resources to tenants organizations.

To return to the Michigan Tenants Counseling Program web site, click here.


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