Study Shows that HUD’s Rent Reform Policy Did Not Increase Employment or Earnings

Date Published: 
May 4th, 2022

MDRC released the fourth report in its ongoing evaluation of HUD’s experimental rent reform policy. HUD commissioned MDRC to conduct the Rent Reform Demonstration, which evaluates how an alternative rent policy could reduce work disincentives for HCV households, reduce administrative burden on PHAs and protect families from greater financial hardship.

The new rent policy adjusts the recertification schedule for HCV families from annual to triennial, creates a new formula for calculating a family’s total tenant payment and subsidy, and implements safeguards for families that experience certain hardships. MDRC observed 6,665 families across four PHAs in Lexington, Louisville, Washington D.C., and San Antonio, and uses approximately four years of quantitative data to document its findings. MDRC found that the new rent policy did not increase employment earnings in unemployment-insurance (UI) covered jobs (as measured by Head of Household employment earnings). However, the results for both the control and research groups in all four PHAs point to voucher holders’ substantial attachment to the labor market, although their jobs were low-paying and, for many, work was inconsistent. The study details that commonly cited reasons for study participants not searching for work were due to health and family care responsibilities. The study also documents that the new rent policy reduced PHAs’ administrative burden in operating the voucher program by reducing the frequency of recertifications to process. Ultimately, MDRC states that the alternative rent policy had little effect on families’ financial and material well-being.

MDRC anticipates releasing a subsequent report on the Rent Reform Demonstration that will observe study participants over a 6-year follow-up period. MDRC hopes the extended follow-up period will make it possible to learn more about the operation and effects of the new rent policy during the economic recession caused by the COVID-19 pandemic.

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