Source of Income:
When Voluntary
Becomes Mandatory
O
n September 11, 2019, the California Legislature
approved Senate Bill 329, which adds Section 8
Housing Choice Voucher (HCV) holders and Veteran
Affairs Supportive Housing (VASH) participants to the state’s
existing “source of income” protections under the California
Fair Employment and Housing Act. This measure is now
awaiting Governor Gavin Newsom’s signature and, if signed,
will require property owners to accept voucher holders if all
other screening criteria is met.
Prior to the law’s passage, California was one of 15 states
where “source of income” was a protected characteristic
under the state’s fair housing law. However, the definition of
“source of income” in California alone was narrowly defined
to apply only to “lawful, verifiable income paid directly to a
tenant or paid to a representative of a tenant.” This meant
that government subsidies, such as Section 8 HCV funds paid
directly to a housing provider, were excluded. In recent years,
California cities saw a trend to remove that exemption and
apply local source of income protections to HCV recipients.
As source of income legislation continues to flourish, it is
crucial for policymakers to understand why property owners
choose to not participate in the Section 8 HCV program.
Legitimate business reasons prevent housing providers from
accepting vouchers; it may not be cost-effective or feasible
to adhere to the program’s requirements to accept a single
voucher holder. It’s also important to note that, even under
source of income laws, housing providers can still deny
applications from voucher holders if the applicant did not
meet the company’s screening criteria.
Many affordable housing providers dedicate their entire
business to managing the multi-level process that is required
to participate in the HCV Program. It can be (and often is) a
full-time job to coordinate with the public housing authority
(PHA) that administers the program locally. In simpler terms,
it is the strings — not the source — that has caused owner
participation rates to flatline.
Source of income will remain a hot topic for NAA in the
upcoming years, as more states consider solutions to housing
affordability and seek ways to find safe and affordable housing
for the low-to-middle income population. To better assist our
affiliates, NAA has a plethora of information that can be found
on the Source of Income policy page.
For more Apartment Advocate, please visit www.naahq.org
www.aamdhq.org
OCTOBER 2019
TRENDS | 35