When federal funding for low-income housing shifted after Hurricane Katrina from government-owned housing projects to vouchers for privately owned residences, many New Orleans policymakers hoped the change would mean new opportunities for the city’s poor.
Instead, many poor residents were shifted from public housing complexes to other neighborhoods, often storm-wrecked, where voucher recipients could afford to live.
Those areas — notably New Orleans East, the Lower 9th Ward and Algiers — were often isolated from jobs and public transit, meaning that basic services for many remained inaccessible.
Now, a recent initiative from the Housing Authority of New Orleans aims to reform the Section 8 voucher program’s structure and make it easier — and more affordable — for low-income residents to live in areas closer to jobs, transportation and health care facilities.
Earlier this year, HANO began paying landlords in some higher-rent areas of the city a premium over the amounts paid in lower-rent areas, in an effort to open up more units in mixed-income parts of the city.
The hope is that the changes, if done right, will persuade more landlords to open their doors to voucher holders while also prompting low-income residents to move into areas that offer greater opportunities.
“The increase in payment ... would incentivize and reduce some barriers, enabling individuals to live in high-opportunity areas,” said Alice Reiner, chairwoman of the housing authority's board.
"If you look at where most people with Section 8 vouchers are, it's concentrated in certain areas ... that may not have as much access to things like transportation and health care and grocery stores."
Typically, a tenant qualifies for Section 8 if they make no more than $13,800 annually, in some instances, or $23,000 annually at most.
Those tenants pay a third of their income in rent; the government pays a private landlord the rest. The government calculates the “fair market rent” it will pay in each metro area.
But because that calculation takes into account relatively cheaper rents in the suburbs, the maximum federal payout is usually only enough for tenants to afford homes in distant or lower-income areas, some experts contend.
Such was the case in New Orleans after the 2005 storm, when local and federal officials agreed to demolish most of the city's remaining housing projects, refashioning them as mixed-income developments, while handing Section 8 vouchers to their former inhabitants.
Of the nearly 18,000 people — many of them former residents of the Lafitte, St. Bernard, B.W. Cooper and C.J. Peete developments — who got vouchers last year, nearly a third ended up in New Orleans East, in ZIP codes with a median household income below the city’s average of $37,488, data from HANO and the U.S. Census Bureau show.
Residents in the East generally face longer commutes to jobs and have fewer retail options than those in other parts of the city. The same is true for residents of the Lower 9th Ward, where household income is below the average and where another tenth of voucher tenants live.
Parts of Algiers, separated from the Central Business District and other east bank job hubs by the Mississippi River, hold more than a tenth of those tenants and also have income below the city’s average.
That kind of isolation defeats the purpose of a program that was intended to move people out of segregated poverty and into neighborhoods of opportunity, said Cashauna Hill, executive director of the Greater New Orleans Fair Housing Action Center.
“For low-income children in particular, having the chance to move to a low-poverty neighborhood leads to better life outcomes,” Hill said, citing data compiled by the nonpartisan Center on Budget and Policy Priorities in Washington, D.C.
In a bid for reform, HANO doled out 25 percent more in rent than is normal this year to landlords in five ZIP codes with low overall poverty rates — areas that include the Freret, Marigny, French Quarter, Lakeview, Carrollton and Lower Garden District neighborhoods.
And it got 66 tenants to move into those areas. But in a signal of what HANO Executive Director Gregg Fortner said is one of the initiative’s major problems, the average poverty rate of the census tracts the families moved into — smaller areas within those ZIP codes that comprise no more than 8,000 people — was nearly 40 percent, almost twice the city’s average.
Nearly half of those people moved into the 70118 ZIP code, which includes both the relatively upscale Uptown and Carrollton areas and the poorer Hollygrove-Dixon neighborhood. Voucher holders mainly ended up in Hollygrove.
When interviewed, most tenants didn’t say they moved to new places because they thought their old neighborhoods were lacking, Fortner said. “It had more to do with them wanting a larger unit, or to be closer to family, or a doctor, or whatever,” he said.
Another huge challenge is funding. Though HANO agreed to run the voucher reform program this year, it did not get any extra federal money to do so, and there’s no guarantee of money later on, Fortner said.
And every dollar HANO spends on higher rent for some landlords is money not going to the more than 24,000 people on the agency’s waiting list for basic Section 8 vouchers.
The program also needs landlords willing to participate.
But one real estate agent, Joe Robert, said the initiative could be great, particularly if HANO continues its work to correct "misinformation" about its program.
"I think that a lot of people feel that Section 8 means tenants aren’t going to be responsible and take care of the properties, but all of my clients that have done Section 8 have had the exact opposite (experience)," Robert said.
“It’s just a snowball effect of misinformation.”