Prohibiting source of income discrimination can reduce barriers to housing in Hawaiʻi
While it’s true that we need more affordable housing in Hawaiʻi, policymakers can also look for ways in which we can better utilize the housing resources that we already have. Such an effort can begin to address up-front barriers to housing that many of our low- and fixed-income community members face.
Rental housing assistance—in the form of vouchers or other subsidies—can help many of our low- and very low-income households to obtain and keep a rental unit while staying within their community.
Voucher programs usually require a household to pay a certain amount of their income toward rent (e.g., 30 percent) and then the voucher pays the remainder of the rent directly to the landlord. There are many housing voucher and subsidy programs, including:
Federally Funded Vouchers Include:
Section 8 Housing Choice Vouchers, which are from the federal government and are administered locally;
Housing First, also referred to as Permanent Supportive Housing, which assists our most vulnerable community members with complex needs, providing various case management services along with housing;¹
Rapid Rehousing, which provides a temporary rental subsidy to allow households to stabilize with anywhere from 1–24 months of assistance;
The U.S. Department of Housing & Urban Development Veterans Affairs Supportive Housing (HUD-VASH), which is a program administered through the U.S. Department of Veterans Affairs (VA) specifically for homeless Veterans; and
Tenant-Based Rental Assistance, which is a two-year voucher to stabilize those who are homeless or at-risk of becoming homeless.
Although we have resources to help many of our community members who are experiencing or are at-risk of becoming homeless, once households receive vouchers they often have a difficult time finding landlords and property managers who will allow them to apply for rental units.
Many advertisements for rentals include language such as “No vouchers” or “No Section 8.” These types of practices are called rental source of income (SOI) discrimination, or discrimination based on where a person’s rental money comes from (i.e., in part or in full from a voucher or subsidy).
Once households receive vouchers, they have a limited time period to find a rental unit or lose the voucher to another household on the waitlist. For example, an initial search period for Section 8 vouchers is at least 60 days, which can be extended by the local housing authority.
Exclusionary practices based on a household’s voucher status keeps people homeless or living in situations of housing instability for longer, and contributes to households losing vouchers they may have been waiting for years to receive. Prohibiting SOI discrimination in Hawaiʻi would help to level the playing field and would give households with rental assistance a better chance at getting into safe and stable housing.
The benefits of having a prohibition against SOI discrimination have been shown across the 16 states and nearly 100 local municipalities in the U.S. which have already implemented such a law. Numerous studies have demonstrated the positive impact that the implementation of SOI discrimination prohibitions can have. For HUD Housing Choice Vouchers in particular, jurisdictions that have implemented such protections have seen increased voucher utilization rates, ranging up to 12 percentage points higher in these jurisdictions than in those without the legal protection.
The ability to actually use a housing voucher can bring people off the streets and lift them out of unstable and even dangerous situations, including being doubled up with family or staying in an abusive relationship.
Prohibitions against source of income discrimination guarantee households with vouchers the ability to apply for rental units (no more “No Section 8” language), and protects the applicant’s right to be judged based on the same tenancy qualifications as any other applicant.
Legally protecting housing vouchers and other subsidies from discriminatory practices would disallow exclusions, discouragement, or refusals to engage with households with rental assistance. This would encompass all steps of the rental process, including the advertisement, application, vetting, transaction and agreement stages. The prohibition would not force landlords to rent to a specific applicant with a housing voucher—it just requires that the landlord make their decision based only on the other criteria that apply to all applicants.
Equity Implications
While rental source of income is not currently a protected category under fair housing law in Hawaiʻi, some landlords and property managers may be masking discrimination against protected classes—such as race, national origin, family status or disability—by deliberately excluding those with rental housing assistance. Protecting rental source of income could therefore help reduce other forms of discrimination as well.
The Federal Fair Housing Act prohibits not only intentional discrimination, but also actions that cause disparate impacts against protected classes. Some studies point out that SOI discrimination may fall into the category of disparately impacting households that belong to already protected classes. For HUD tenant-based vouchers in Hawaiʻi, as of September 2021, just over 70 percent of the households served racially identify as people of color, with Native Hawaiians and Other Pacific Islanders making up around one-third of all households served. Some 41 percent of the households served had at least one household member with a disability. Additionally, 36 percent of HUD tenant-based vouchers served female-headed households with minor children.
Service provider organizations have reported common experiences of disparate treatment of their clients based on their race or ethnicity—especially households that are Native Hawaiian or from the Compact of Free Association (COFA) nations in Micronesia. One community provider received a call from a landlord who was willing to rent to households with rental housing assistance, but told the provider that they would specifically refuse to rent to Micronesian households.
Even when households with rental housing assistance are not excluded from rental applications because of their rental source of income, practices such as “steering” or the unequal application of rules are other common barriers for households with vouchers. These practices are based on stereotyping of already protected classes such as race.
Steering involves landlords directing prospective tenants to certain neighborhoods, while other landlords will unevenly apply lease rules as justification to reject an application based on assumptions about the applicant that are based on race. (For example, the racist assumption that a prospective tenant will invite extended family members to live in the rental unit who are not on the lease simply because they are from a racial community known for having large extended families.)
Based on the frequency with which local service providers witness these types of practices occurring in the community, allowing blanket exclusion of households with vouchers or other subsidies from application seems likely to perpetuate these discriminatory and sometimes even racist practices.
In addition to improved voucher utilization rates, jurisdictions with source of income discrimination prohibitions have been found to improve racial equity with respect to neighborhood distribution. When we expand the range of possibilities for where individuals and families live, we expand the realm of opportunity in many other aspects of their lives—particularly for job and educational prospects.
Households of color—in particular Native Hawaiian and Pacific Islander households—are dramatically overrepresented among the houseless population, as well as in our criminal justice system. Both outcomes are tied to economic barriers and, more deeply, colonialism and displacement of indigenous systems of thriving in the Pacific. Vouchers help provide access to a greater range of opportunities for employment, more childcare options and better schools, and can reduce crime.²
While legislation to prohibit SOI discrimination has not yet been adopted in Hawaiʻi, agencies throughout the state that serve those who are experiencing homelessness or those who are at risk of becoming houseless continue to support and advocate for the passage of such a law. While building new units is important, we can and should also find ways to better use the housing resources available to us right now—especially for people experiencing housing insecurity.
Rental housing assistance programs are run through governmental and service provider organizations. There are a variety of programs to fit the needs of landlords, as well as support available to landlords through the programs themselves. For example, the Landlord Engagement Program (LEP) on Oʻahu has a 24/7 support phone line available, as well as access to a damage mitigation fund if needed for a rental unit.
In return, what the community needs from landlords is for them to judge prospective tenants equally, and resist falling into patterns of discrimination.
To learn more about source of income discrimination and the need for engaging more landlords in housing assistance programs, please visit this webpage from the Office of the Governor’s Coordinator on Homelessness.
Notes
Housing First (also referred to as Permanent Supportive Housing) vouchers are funded through the federal, state and municipal governments. The federal funding through the HUD Continuum of Care program is by far the largest source of funding for this type of voucher. The State of Hawaiʻi funds a small number of Housing First vouchers on Oʻahu, as does the City & County of Honolulu. While state funds are also available for Housing First vouchers on Hawaiʻi Island, Maui and Kauaʻi, these jurisdictions do not have county-funded vouchers and rely on a combination of the state and federal vouchers. Rapid Rehousing is funded primarily by the federal and state governments. Federal funding comes primarily from Emergency Solutions Grant and Continuum of Care funds.
Chetty, R., Hendren, N., & Katz, L.F., “The effects of exposure to better neighborhoods on children: New evidence from the Moving To Opportunity experiment,” National Bureau of Economic Research, 2015.