VASH and LIHTC Can Work Together to Support Veterans in Housing and Beyond
Posted by Quinn Gormley and Flynann Janisse on March 1, 2017
Earlier today, the U.S. Senate advanced Ben Carson's nomination to lead the U.S. Department of Housing and Urban Development (HUD), setting up for a final vote later this week. As we await this vote, it's a good time for those of us in the field to carefully assess existing housing programs in an effort to effectively advocate not only for their continuation, but enhancement. An example of this is the Veterans Affairs Supportive Housing voucher (VASH).
The VASH voucher program is a partnership between the Veterans Administration (VA) and HUD. VASH enables not only housing rental assistance through the Housing Choice Voucher program, administered by local Public Housing Agencies, but also provides essential case management and clinical services through the Veterans Administration at participating VA medical centers and authorized community-based outreach clinics.
Combined with the Housing First approach, VASH’s primary goal is to not only end veteran homelessness overall, but to sustain veterans in permanent housing. Overall, the program has been extraordinarily successful in meeting these goals. Since its inception, over 85,000 vouchers have been awarded, motivating Congress to provide new funding in 2012, making an additional $75 million available that fiscal year. Per the latest data available, 80 percent of those enrolled in the Supportive Services for Veteran Families program were transitioned to permanent housing.
In light of this accomplishment, the continued careful execution of this program should be a priority for HUD. More than 700,000 veteran households are paying more than 50 percent of their income on housing—an unsustainable percentage. Such a burden results in high housing turnover rates which harms the financial performance of a housing asset, and leaves unstable communities in its wake. This is where VASH proves to be instrumental.
Besides the veterans’ resident supportive services element, VASH includes the Housing Choice Voucher, which reduces the rental burden of the veteran by making quality affordable housing that utilizes Low-Income Housing Tax Credits attainable. Where the voucher subsidizes tenant's rent so that they pay 30 percent of their actual income, the LIHTC program offsets the cost to develop affordable housing by generating investment equity, reducing the actual debt needed to pay for the cost of the development. This in turn reduces the need to charge higher rent, and creates affordability.
Many Qualified Allocation Plans (QAPs), the annually produced document that regulates state LIHTC allocation criteria, specifically require some level of resident services as a condition of a tax credit allocation—which is, in Rainbow’s opinion, a tremendously important component of the program. Services for veterans can directly correlate to lower turnover and thus consistent income.
While vouchers have been used in LIHTC for years to reduce the rental burden, arguably the most important component of VASH is the resident services. VA case managers work with veterans to address issues that may be barriers to an improved quality of life and mitigate housing eviction risk. The property managers, resident services provider, and VA case manager must work to get to know the needs of the veteran resident in order to develop the wrap-around supportive services that allows the voucher to be leveraged for more than housing. Outside of achieving operational success, both the LIHTC program and the VASH program have regulatory needs that must be met to be truly successful. It is important to gather a knowledgeable development team when considering the utilization of these affordable housing programs. Contracting the right resident services team with the operational sustainability, acknowledged track record, and ability to successfully coordinate the tenant intake efforts of the property manager and VA case worker is essential to the long-term overall success.
Long an advocate of combining housing plus supportive services, we know that getting housed is key; however, the wrap-around supportive services are what make the housing successful and sustainable for everyone involved.
Image: From the Minnesota National Guard, via flickr, CC BY-ND 2.0)
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Quinn Gormley served in the United States Marine Corps and is the director of real estate consulting in the Austin office of CohnReznick, an accounting, tax, and professional advisory services firm. Flynann Janisse is the executive director of Rainbow Housing Assistance Corporation whose mission is to create and preserve quality, affordable housing for families and individuals of diverse ethnic, social, and economic backgrounds; while supporting their well-being through the delivery of onsite social services programs.