Author: Revisions contributed by, Housing Law Project of the Legal Assistance Foundation of Metropolitan Chicago
Last updated: August 2011
This section outlines housing assistance available through programs established by federal and state legislation. The assistance may take the form of leasing of public housing or rent subsidies for private housing.
The procedural requirements and defenses applicable to private housing evictions apply to federally subsidized housing. Some additional procedural rules and defenses also apply.
Different rules and procedures apply to different types of subsidies, although generally, tenants pay 30% of their adjusted income for rent (but PHAs must set a minimum rent of $50). In the public housing and Section 8 project-based programs, the lease agreement automatically renews itself at the end of every term and may be terminated only for good cause. But in the Section 8 Housing Choice Voucher Program, a tenant-based assistance program, the lease may be terminated without good cause at the end of the initial term or at the end of any successive term.
The different types include:
With the passage of the United States Housing Act, Congress enacted the conventional public housing program (42 USC §1437, et seq). Pursuant to this program, housing is owned by a local public housing authority (PHA), which administers the program.
The following individuals are eligible for public housing, provided their income does not exceed 80% of the median income for the metropolitan area and they do not have assets in excess of the limitations established by the local PHA:
Note: Single persons who do not fall into any of the above categories are ineligible unless eligibility is specifically authorized by an Office of Housing and Urban Development (HUD) field office.
Families –The regulations do not require that individuals be related by blood or marriage to constitute a family. An unmarried couple, a pregnant woman, and an adult with physical custody (not necessarily legal custody) of a child may qualify. (PHA often requires some proof that custody is legal and permanent; similarly, unmarried couples need, at least, evidence of a long term stable relationship).
Handicapped – A person is considered to be handicapped if he or she has a mental or physical impairment that is expected to be of indefinite duration, which substantially impedes his or her ability to live independently, and is of such a nature that his or her ability to live independently could be improved with more suitable housing. Although alcoholics and drug addicts in recovery are specifically included in the federal Fair Housing Act, they are specifically excluded from admission or continued occupancy in public housing.
Disabled Person – A disabled person is a person who is disabled under the Social Security Act, or who has a developmental disability as defined by the Developmental Disabilities Assistance and Bill of Rights Act.
Displaced Person – A displaced person is a person displaced by governmental action, or whose dwelling has been extensively damaged or destroyed as a result of a federally recognized disaster.
Elderly Family – An elderly family is a person at least 62 years of age, or a family whose head or spouse is an elderly person. Some housing is available to elderly persons aged 60 and older.
Remaining Member of a Tenant Family – A remaining member is a member of a family listed on the lease who continues to live in the apartment after the head of household has died or vacated the premises. If the remaining member was on the lease, he or she can usually remain in the apartment. Foster children and live-in-aides cannot be remaining household members. The PHA must issue a new lease to the remaining member, provided the remaining member is otherwise eligible.
Federal preferences have been eliminated.
Public housing authorities may establish their own system of preferences. The client may need to ask for the PHA's preferences. The preferences adopted by the PHA may not violate other laws, for example, the Fair Housing Act.
Rent includes payments to the PHA and the utility allowance. Tenants in public housing must pay as rent the highest of the following amounts:
To determine a family’s income, anticipated annual income is used. Income includes income from non-excludable assets, wages and all other types of compensation, Social Security and other benefit payments, annuities, pensions, disability benefits, welfare, alimony and child support, net income from a business, and regular gifts.
Income does not include foster care payments, inheritances and insurance payments, medical expense reimbursements, educational scholarships, and veterans benefits used for tuition, fees, books, equipment, materials, supplies, and transportation, special armed forces pay, certain Supplemental Security Income, HUD and other public assistance payments, sporadic or temporary income, gifts, or amounts excluded by federal statute. Amounts specifically excluded under other federal statutes include, inter alia: food stamps, Low-Income Home Energy Assistance Program payments, and payments received under Title V of the Older Americans Act of 1965.
Income is further reduced by subtracting the following deductions under 42 USC §1437a(b)(5):
Note: A family that suffers a decrease in income is entitled to a decrease in rent effective at the latest on the first of the month following reporting.
Grievance hearings are available only to public housing residents who want to contest any adverse action taken by the PHA, e.g., termination of tenancy (though grievance hearings are not available to tenants who are facing eviction for drug-related or violent crimes), failure to allow a pet, failure to make repairs, rent recertification, and disclosure of confidential information. The process need not be exhausted to pursue judicial remedies. (For Grievance rights related to eviction, see Eviction and Termination, infra.)
The PHA must have a written grievance procedure that affords the tenant the right to receive advance written notice of the proposed adverse action. The tenant may challenge this action by submitting to the PHA a timely written request for an informal conference or hearing.
After the informal conference, the PHA must provide a written summary to the tenant. If the tenant is unhappy with the resolution, the tenant may appeal by filing a formal grievance. The hearing officer cannot be the person who made the original decision or be supervised by the person who made the original decision. The tenant has a right to review the file and all other evidence. The burden of proof is on the PHA. The PHA must consult with tenant councils as to their selection of hearing officers. After a hearing, a written decision that must include findings of fact is issued. 24 CFR §§966.56; 24 C.F.R. §966.57.
Elderly persons or families who want to obtain an apartment in an elderly high-rise must file an application with the local PHA. Applicants may apply ahead of time (six months to a year before their 62nd birthday).
With the passage of the Housing and Community Development Act of 1974, Congress enacted the Section 8 Housing Program (42 USC §1437f). Section 8 programs include:
Section 8 tenant-based assistance provides "housing choice vouchers" to eligible individuals and families who live in private housing. Congress enacted the voucher program in 1983. A similar program, the Section 8 existing housing certificate program, has been phased out. The 1998 Housing Act required that Section 8 certificates be converted into vouchers.
A voucher holder finds an acceptable apartment and a private landlord who is willing to participate in the program. The PHA then inspects the unit. If the apartment is approved, the landlord contracts directly with the PHA. The PHA pays a Section 8 subsidy to the landlord pursuant to that contract. The landlord also must sign a one-year lease with the voucher holder. Vouchers allow low-income tenants to retain rental assistance when they move from their current dwelling unit to another unit.
Tenants under the voucher program may pay more than 30% of their adjusted income for rent. The limit for the tenant's share of the rent is 40% of adjusted gross income at the time the family initially receives tenant-based assistance. 24 CFR §982.508. Landlords may charge more than the fair market rent set by HUD.
HUD determines the "payment standard" for dwelling units of various sizes in each market area. The payment standard must be no less than 90% and no more than 110% of fair market rents in the area. If the rent plus any utility allowance for a dwelling unit does not exceed the payment standard, the tenant pays the greatest of the following amounts:
Under those circumstances, the PHA pays the landlord a monthly housing assistance payment equal to the difference between the "gross rent" and the tenant's payment. The gross rent is the rent charged by the landlord plus any utility allowance, representing the amount of tenant-paid utilities.
If the gross rent exceeds the payment standard, the PHA pays the landlord a monthly housing assistance payment equal to the difference between the payment standard and the greatest of the amounts under the three options above. The tenant pays the difference between the gross rent and the monthly housing assistance payment. In that situation, the tenant pays more than 30% of the family's adjusted gross income. 42 USC §1437f(o)(2).
Tenant eligibility requirements under the Housing Choice Voucher Program are the same as those set forth above for public housing.
Applicants under the voucher program are eligible if they are one of the following:
A "very low-income family" is a family with an annual income that does not exceed 50% of the median income for the area, as determined by HUD.
A "lower-income family" is a family with an annual income that does not exceed 80% of the median income for the area.
A PHA may deny or terminate voucher assistance if:
Under the Section 8 Project-Based Assistance Programs, HUD enters into housing assistance payments (HAP) contracts with the private owners of housing complexes or buildings. During the term of these contracts, the apartments are subsidized, so the Section 8 rental assistance runs with the units, and tenants who reside in these units get the benefit of the subsidies. As in the public housing program, the lease agreements automatically renew themselves at the end of each term and may be terminated only for good cause. When the HAP contracts expire, owners my “opt-out” of the Section 8 Program, but the displaced residents receive Section 8 vouchers that they can use in the private housing market, or enhanced vouchers that allow them to remain in their units.
The following Section 8 programs use the project-based assistance model:
New Construction, Substantial Rehabilitation, and Moderate Rehabilitation Programs – These are rental assistance programs (24 CFR Part 880, New Construction; 24 CFR Part 881, Substantial Rehabilitation; and 24 CFR Part 882, Moderate Rehabilitation). Under these programs, HUD contracts directly with the owner of a housing unit to pay the difference between the contract rent and the tenant’s share of the rent.
Set-Aside Program for Projects with HUD-Insured or HUD-Held Mortgages - This program is a rental subsidy program providing rental subsidies to existing multifamily Section 221(d)(3), Section 236, and Section 202 projects (24 CFR §§886.101 – 886.132).
Property Disposition Set-Aside Program – This program is a rental program in connection with the sale of HUD-owned housing (24 CFR §§886.301-886.337), and is used in conjunction with the sale of multifamily apartments foreclosed by HUD.
Section 8 Assistance for State Housing Agencies - HUD provides Section 8 subsidies to state housing finance agencies (24 CFR Part 883). The state agency provides financing for construction or rehabilitation of housing developments. Federal Section 8 funds are passed through to the state agencies to provide rental subsidies to developers of those projects. In Illinois, the housing finance agency is the Illinois Housing Development Authority (IHDA).
Eligibility, Rent Computation, and Tenant Selection – Tenant eligibility and rent computation rules for subsidized housing are basically the same as criteria for public housing. Each owner of a Section 8 development is responsible for selection of tenants. 42 USC §1437f(d)(1).
NOTE: Annual income and rent for subsidized housing tenants are computed in the same manner as they are computed for public housing tenants. The income exclusions are the same, except for lump sum additions to family income. The deductions from family income are identical to the deductions allowed under the public housing program.
The Federal Housing Administration (FHA) provides private developers with mortgage insurance and interest subsidies to assist in the development of affordable housing. Housing assisted by FHA, a division of HUD, includes the Section 221(d)(3), Section 236; and Section 202 programs.
Section 221(d)(3) Program - This program provides mortgage insurance and an interest subsidy that reduces interest paid by the developer to three percent. The interest subsidy was designed to allow the developer to offer lower rents. The housing project is subject to HUD regulation as to tenant eligibility and rent computation during the term of the mortgage.
Section 236 Program – This program was enacted as part of the Housing and Urban Development Act of 1968. Under this program, an owner obtains an FHA-insured market rate project mortgage and is obligated to make loan payments to the lending institution as though the loan had a one percent interest rate. HUD makes the remainder of each payment directly to the lender. The owner must charge rents equal to 30% of adjusted tenant incomes, but rents cannot be higher than market rents nor lower than "basic rents" (i.e., the rents that would be charged if the mortgage interest rates were actually one percent).
Section 202 Program – This program was enacted as part of the Housing and Urban Development Act of 1959 (12 U.S.C. §1701q). Under this program, HUD provides direct loans at below market rates to private non-profit corporations, limited-profit sponsors, consumer cooperatives, and public bodies that provide housing for elderly or handicapped families.
Tenants in public housing and other federally subsidized housing have additional rights and remedies that are set forth in the applicable federal statutes and regulations. Public and subsidized housing evictions must also meet the procedural requirements for forcible entry and detainer actions under Illinois law.
Isolated instances of objectionable conduct are not a sufficient basis to terminate a subsidized tenancy. Only a material violation of a lease provision can justify eviction, and there must be evidence that the tenant was aware or acquiesced in the alleged violation. Mid-Northern Management v. Heinzeroth, 234 Ill.App.3d 240, 599 N.E.2d 568, 174 Ill. Dec. 784 (2d Dist. 1992).
A court should consider all the circumstances presented in determining material noncompliance with the lease, including such factors as past and overall compliance with the lease. American National Bank and Trust Co. v. Dominick, 154 Ill. App. 3d 275, 507 N.E. 2d 512, 107 Ill. Dec. 599 (1st Dist. 1987).
In addition, under the Rehabilitation Act, Section 504, federally assisted housing providers have a special duty to make reasonable accommodations to persons with disabilities, including taking affirmative steps to accommodate the disability.
Public housing authority may not terminate the tenancy or refuse to renew the lease except for serious or repeated violation of material terms or conditions of the lease or for other good cause. A serious or repeated violation of material terms of the lease may include a failure to make payments due under the lease or to fulfill the tenant obligations set forth in §966.4(f). 42 USC §1437d(l); 24 CFR §966.4 (1) (2) (i).
Each public housing agency shall utilize leases which provide that any criminal activity that threatens the health, safety, or right to peaceful enjoyment of the premises by other tenants or any drug-related criminal activity on or near such premises, engaged in by a public housing tenant, any member of the tenant’s household, or any guest under the tenant’s control, shall be cause for termination of tenancy. 42 USC §1437d(l).
Either of the following types of criminal activity by the tenant, any member of the tenant’s household, a guest, or another person under the tenant’s control, shall be cause for termination of tenancy:
Lease termination notice. The PHA shall give written notice of lease termination of:
The notice must include sufficient specificity to enable the tenant to prepare a defense. This means it has to list specific facts, dates, as well as the specific section of the lease that was violated. Escalera v. New York City Housing Authority, 425 F. 2d 853 (2d Cir. 1970).
The notice must also inform the tenant of their right to a grievance hearing.
The Illinois Forcible Entry and Detainer Act permits a PHA to bring an expedited eviction action against a tenant based on certain criminal conduct, such as trafficking of controlled substances. 735 ILCS 5/9-118. A written notice of demand for immediate possession may be served at the time of service of the summons.
Criminal Activity Exception. Evictions based on certain types of tenant criminal activity may be excluded from the grievance requirement. These include drug-related criminal activity on or near the premises or criminal activity that threatens the health, safety, or peaceful enjoyment of the premises of other tenants or PHA employees. 24 CFR §966.51 (a) (2).
Expedited Grievance Procedure. A PHA may establish an expedited grievance procedure for a grievance that involves termination of tenancy based on drug-related criminal activity on or near the premises or criminal activity that threatens the health, safety, or peaceful enjoyment of the premises of other tenants or PHA employees. 24 CFR §966.55(g).
Tenant must request the grievance. The tenant must request a grievance. The PHA may establish short time-frames for such requests. It may not be clear on the notice of termination of tenancy what the exact time-frame is. In general, tenants request an informal conference with PHA staff first. In the event the matter is not resolved, the tenant must request a formal hearing. It is very important to advise the tenant to request the grievance in a timely manner.
The PHA cannot take judicial action to evict the tenant until a written decision on the grievance has been made.
The PHA cannot override a decision of the impartial decision-maker unless it is contrary to law.
The PHA need not issue another notice to terminate the tenancy if the hearing decision is unfavorable to the tenant.
An owner of FHA or Section 8 project-based assisted housing may only terminate a tenancy or refuse to renew a lease based on good cause. Tenants in those developments have (1) the right to timely and adequate notice of the grounds for termination of their tenancies or subsidies,(2) the right to be notified that they may meet with management within 10 days of receiving the notice and (3) the right to a judicial hearing on the allegations. Subsidized housing evictions must comply with federal statutory and regulatory requirements, and state forcible entry and detainer provisions.
Regulations governing evictions in FHA housing, 24 CFR Part 247, provide that a landlord may not terminate a tenancy except on the following grounds:
The 1998 Housing Act eliminated the right to continued tenancy after the expiration of the term of the lease for Section 8 voucher holders. The initial term of the lease is one year. The Act allows a landlord to terminate the tenancy of a voucher holder tenant at the end of a lease term without establishing good cause, provided proper notice is given. 42 USC §1437f(o)(7). After the lease expires, a month to month tenancy may be created. This change in federal law permits a private landlord to terminate the voucher holder's month to month tenancy with a 30 day notice. Note that a voucher holder may then use his or her voucher to move to another unit.
During the term of the lease, the owner may not terminate the tenancy of a voucher holder, except on the following grounds:
-failure by the family to accept the offer of a new lease or revision;
-the owner’s desire to use the unit for personal or family use, or other than as a residential rental unit; or
-a business or economic reason for termination of the tenancy (such as sale of the property, renovation of the unit, desire to lease the unit at a higher rental). A business or economic reason may only be asserted after the first year.
During the first year of the lease term the owner may not terminate the tenancy for "other good cause."
-criminal activity that threatens the health, safety or right to peaceful enjoyment of the premises by other residents;
-criminal activity that threatens the health, safety or right to peaceful enjoyment of their residences by persons residing in the immediate vicinity of the premises; or
-drug-related criminal activity on or near the premises.
The owner must give the tenant a written notice that specifies the grounds for termination of tenancy during the term of the lease. The notice of grounds must be given at or before commencement of the eviction action. The notice of grounds may be included in, or may be combined with, any state required eviction notice. The owner must give the PHA a copy of any owner eviction notice to the tenant.
Non-Payment of Rent. Improper calculation of rent can be a defense to an eviction action. Peoria Housing Authority v. Sanders, 54 Ill.2d 478, 298 N.E.2d 173 (1973).
Termination of assistance for a Section 8 voucher participant may include:
The Housing Authority may at any time deny program assistance for an applicant or terminate program assistance for a participant. Some actions will automatically trigger termination while others will require the PHA to decide to terminate assistance at their discretion. Assistance can be terminated for any of the following grounds:
-supplying true and complete required information, including SSN’s, income information, and citizenship information
- allowing the PHA to inspect the unit at reasonable times with reasonable notice
-notifying the PHA before moving
-keeping the PHA informed as to any change in family composition, and
-failing to prevent a Housing Quality Standard (HQS) breach caused by the family
In deciding whether to deny or terminate assistance because of action or failure to act by members of the family, including criminal activity, the PHA has discretion to consider all the circumstances in each case, including the seriousness of the case, the extent of participation or culpability of individual family members, and the effects of denial or termination of assistance on other family members who were not involved in the action or failure. The Court held in Gaston v. CHAC Inc., the the PHA must consider mitigating circumstances. Gaston v. CHAC Inc., 375 Ill. App. 3d 16, 872 N.E.2d 38, 45 (1st Dist. 2007).
The PHA may impose as a condition of continued assistance for other family members a requirement that family members who participated in or were culpable for the action or failure to act will not reside in the unit. The PHA may permit the other members of a participant family to continue receiving assistance.
At any time, the PHA may deny or terminate assistance if any member of the family commits:
The standard is preponderance of the evidence and does not require a criminal conviction or even an arrest.
The PHA may deny or terminate assistance because of illegal use, or possession for personal use, of a controlled substance. Such use or possession must have occurred within one year before the date that the PHA provides notice to the family of the PHA determination to deny or terminate assistance. The PHA may not deny or terminate assistance for such use or possession by a family member if the family member can demonstrate that he or she:
The PHA may require the family member who has engaged in illegal use of drugs to submit evidence of participation in, or successful completion of, a treatment program as a condition to being allowed to reside in the unit.
The PHA must give the opportunity for an informal hearing before the PHA terminates housing assistance payments for the family under an outstanding HAP contract.
24 CFR 982.555(c)
The PHA must give the family prompt written notice stating that the family may request a hearing. The notice must:
The PHA administrative plan must state the procedures for conducting informal hearings for participants.
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