The Federal Government is Subsidizing Wealthy Families Who Live in Public Housing

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here. The U.S. Housing and Urban Development (HUD) spends $104.4 million annually to subsidize wealthy families who live in public housing, according to Sen. Rand Paul, R-KY. Over the past several weeks, Paul’s office has published unusual examples of misguided spending by federal agencies. The Kentucky Republican calls it The Waste Report. The latest edition focuses on a recent report from the HUD inspector general that uncovered more than 25,000 families make too much money to live in public housing. Rep. David Roe, R-TN, requested the report. “Public housing authorities provided public housing assistance to as many as 25,226 families whose income exceeded HUD’s 2014 eligibility income limits. Of these 25,226 families, 17,761 had earned more than the qualifying amount for more than 1 year,” David Kasperowicz, HUD’s regional inspector general in Philadelphia, wrote in his findings. “HUD regulations require families to meet eligibility income limits only when they are admitted to the public housing program. The regulations do not limit the length of time that families may reside in public housing.” “The 15 housing authorities that we contacted choose to allow overincome families to reside in public housing. HUD did not encourage them to require overincome families to find housing in the unassisted market. As a result, HUD did not assist as many low-income families in need of housing as it could have,” he added. Kasperowicz, in his report, offered examples of wealthy families who live in public housing. A four-person New York City family lived in public housing since 1988. Although the family may have qualified when it first entered the system, they’ve “been overincome since at least 2009.” In 2013, the family’s income came in just under $498,000. The head of the household also had rental properties that produced more than $790,000. An individual living in public housing in Nebraska since 2005 had been overincome for several years. “As of April 2014, the single-member household’s annual income was $65,007, while the low-income threshold was $33,500,” Kasperowicz noted. “Also, this tenant had total assets valued at nearly $1.6 million, which included stock valued at $623,685, real estate valued at $470,600, a checking account with a balance of $334,637, and an individual retirement account with a balance of $123,445. As of April 2014, the tenant paid a flat rent of $300 monthly for the public housing unit.” Apparently, HUD objected to the audit, according to the report, “on the grounds that the governing statute and regulations require that public housing authorities not deter overincome families from residing in public housing.” Common sense, it seems, is lacking at HUD. Let’s put this one in the “Only Government Can Be This Absurdly Wasteful” file.