Developers taking public funds should accept rent vouchers, Charlotte housing chief says
Mecklenburg renters who use vouchers are often kept out of areas of highest opportunity, and Charlotte’s housing authority wants county leaders to leverage big-budget development deals to expand access to housing.
Fulton Meachem, Inlivian’s CEO, has asked Mecklenburg County to require developers who ask for taxpayer money from the county — including land transactions and tax incentives — to accept vouchers in any housing built.
Too many landlords automatically screen out potential tenants with vouchers for way they pay, Meachem said, even if applicants meet other rental criteria, like credit score and a background check, and have a voucher that covers the asking rent.
Individuals and families often wait for years on the local waiting list for federal Housing Choice vouchers, often referred to as the Section 8 program. When their turn comes, about 1 of every 5 will ultimately not use the rental voucher they’re eligible for because they can’t find a willing landlord.
That discrimination, Meachem told members of the county’s intergovernmental affairs committee last week, pushes people with vouchers into areas of poverty and low opportunity, far from jobs and transit and into areas of higher crime.
“We know that when we’re 50 out of 50 when it comes to economic mobility in the city, one of the biggest indicators about that is economic segregation,” he said.
Some cities and states have laws against landlords turning down prospective renters based on their source of income, like if they get help paying rent through vouchers. Past efforts to pass a local law against source of income discrimination for renters have not succeeded.
Inlivian’s proposal to the county would be similar to other terms written into requests for proposals for public money, Meachem said. City and county leaders routinely include benchmarks for things like minority and women-owned business inclusion when seeking project bids.
In Mecklenburg, the housing authority administers 5,000 federal Housing Choice vouchers, which are for families earning 30% of the area median income or below ($17,700 for an individual or $25,250 household income for a family of four).
The voucher pays the difference between what a household can afford and the asking rent for housing that would be otherwise out of reach. Source of income protections don’t require landlords to accept an applicant who has a voucher, but rather asks them to be considered on the same playing field as others.
Putting such a requirement for county-funded development deals that include housing, whether market rate or affordable, Meachem said, is a way to expand access to high opportunity areas and ease concentrated poverty.
“We feel like we shouldn’t be using taxpayer dollars and then allow them to discriminate against the exact same taxpayers that provided the taxes,” he said.
What is source of income discrimination?
The Housing Choice program is largest voucher program in Charlotte, but advocates say landlords also routinely reject veteran vouchers, disability payments and other rental subsidies.
Inlivian officials say their clients often struggle to find landlords willing to accept vouchers and are forced to return the help if they don’t fund a unit within 180 days.
A campaign to add source of income to the fair housing ordinance began in 2019, which would add the way people pay rent to other classes protected from discrimination like race, sex, family status and disability.
The city attorney has previously advised council members that it may be beyond their authority and could invite legal challenges. An ad hoc committee convened by the city has been studying source of income discrimination and will present its findings in December.
How it could affect county deals
Requirements to accept vouchers aren’t new for local affordable housing projects. Developments that use low-income housing tax credits and the city’s housing trust fund already require it.
But this proposal from Inlivian would also encourage expanding tenants’ access to market rate housing so long as the voucher covers the rent. It would be separate from affordable housing provisions in a given development achieved through specific rent-restricted units, which is a more common practice in Charlotte.
A number of pending or upcoming requests for public funding of local developments could be affected, including those involving tax increment grants, or TIGs.
Developers using a TIG get rebates on their annual property taxes for upfront infrastructure costs like roads and parking decks, or items that help with local governments’ goals, such as affordable housing and creating jobs.
Commissioner Susan Rodriguez-McDowell said last week she supports a voucher acceptance policy, and wants further discussion as key big-dollar requests come before the county, such as Atrium’s Innovation District.
The county is considering up to $40 million for a tax increment grant for Atrium’s Innovation District, which would surround a future medical school in midtown.
Other big projects, like the River District, Eastland, and Ballantyne Reimagined, sought millions in public money.
County Manager Dena Diorio said last week most TIG agreements include combined city and county tax rebates, so Mecklenburg would need to work with the city of Charlotte.
Inlivian also plans to offer amendments to a Charlotte policy requiring voucher acceptance, which covers only city-supported affordable housing.
Inlivian officials say the current language is limited in effect because those affordable developments already require voucher acceptance. They plan to recommend expansion include all city-supported housing developments, including market rate, as part of the ad hoc committee’s report later this year.
This story was originally published November 9, 2021 at 6:00 AM.
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