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PRESS RELEASE:
DHS Unveils Reform Package Centering on Work and Self-Sufficiency
New rental strategy rewards work and prepares clients for independent living through matched savings
New York City Department of Homeless Services (DHS) Commissioner Robert Hess today announced a package of reforms—from expanded prevention before homelessness begins to new rental assistance strategies that help clients move beyond shelter— that focuses on work as the path to self-sufficiency. The centerpiece of the reform package is Work Advantage, a rental subsidy which will help those in shelter secure permanent housing and reduce their reliance on public supports by rewarding work. DHS’ comprehensive approach builds on the strengths of previous reforms and puts the Agency in position to meet the goals set by Mayor Bloomberg’s Five-Year Action Plan to reduce homelessness by two-thirds by 2009.
Historically, the main way out of shelter was through Section 8 vouchers—a federal rental subsidy without a time limit or a work requirement. Several years ago, access to these federal vouchers became unpredictable. New York developed its own local rental subsidy, Housing Stability Plus (HSP), designed to move clients closer to economic independence. HSP was a first attempt towards encouraging employment and self-sufficiency by creating a gradual reduction in the rent subsidy and incorporating a five-year time limit.
Work Advantage will replace HSP and provides rental assistance that is not tied to the continued receipt of Public Assistance. It is a one year rental subsidy with a second year extension available for those who meet continuation criteria. While receiving the rental assistance, participants will be working and encouraged to save their earnings. These savings will be doubled so that when the rental assistance ends, families have additional means of support.
“With Work Advantage, we’ve created a rental assistance strategy that builds on the foundation of the previous programs,” said DHS Commissioner Robert Hess. “It rewards clients for working and saving money rather than penalizing them by taking away their rental assistance for working. Work Advantage also focuses on self-reliance by providing clients with the tools and resources that are critical to their success, something that has not been done before.”
“This program is consistent with our focus on work as a critical path out of poverty,” said Commissioner Robert Doar from the Human Resources Administration (HRA). “HRA is committed to being a full partner in providing the supports and tools necessary to get and retain employment and housing.”
A key tool in the Work Advantage program is a savings program that will provide clients with a financial cushion when rental assistance ends. While clients are receiving the rental subsidy, which will account for almost 100% of their rent, they can contribute up to 20% of the rent amount to a savings account that will be matched at the end of the program. In addition, clients will pay $50 in rent directly to the landlord, which will also be matched and added to the client’s savings. For instance, after one year, a family with a monthly rent of $1,070 who was saving at a rate of 20% per month could end up with nearly $6,000 in a savings account, including the client savings and City matching funds. This new approach helps clients move closer to self sufficiency by gradually easing into expectations of the rental market.
In addition, this program includes access to a comprehensive package that will support work and economic stability including jobs, workforce development, and transitional benefits such as food stamps, Medicaid and child care. HRA will also work with Work Advantage clients through welfare to work programs by providing job training, search and placement support. Using these same tools, more than 77,000 public assistance recipients were placed in jobs last year. Work Advantage represents the continued fulfillment of Mayor Bloomberg’s promise of a more effective way to place public assistance recipients in jobs.
This is further enhanced by financial education and guidance. The Department of Consumer Affairs’ (DCA) Office of Financial Empowerment (OFE) is working with DHS on Work Advantage’s matched-savings component. They will help DHS clients access the tax credits they deserve as well as available banking options. In addition, guidance will be provided to clients on how to save and make their money grow for the future. As part of Mayor Bloomberg’s aggressive efforts to fight poverty in New York City, OFE is the first city government initiative in the nation that works expressly to empower, protect, and educate workers with low incomes so they can make the most of their financial resources and break the cycle of poverty.
DHS data show that families that leave shelter for permanent housing, including unsubsidized housing, have a low rate of return to shelter. The rate of families returning to DHS shelter within two years was 4% in 2006. To further minimize the rates of return, DHS’ comprehensive approach also includes assistance during clients’ transition to independent living through “aftercare” services. Work Advantage clients will be referred to HomeBase, DHS’ nationally recognized homelessness prevention program. Here, they will receive aftercare services throughout the year. These services include help with upgrading jobs, household budgeting, tenancy and legal services.
A comparison of Work Advantage to HSP and Section 8 follows:
One Size Doesn’t Fit All: Rental Assistance for Special Circumstances
Recognizing that one size does not fit all, rental assistance is also available to two special needs populations. For up to one year, families and individuals who are receiving federal benefits such as Social Security Disability Insurance, can receive rental assistance. Families in shelter with open Administration for Children’s Services (ACS) cases can also access one year’s rental assistance.
These special need, priority populations will be given rental assistance as they return to community housing. From there, they will be prioritized for available Section 8 vouchers or other supports in the event they are not Section 8 eligible. Aftercare services and additional supports will also be available to assist these families transition back to the community.
Homelessness Prevention
While many of these efforts focus on helping clients to exit shelter, DHS is also redoubling its efforts to help families avoid shelter by increasing prevention assistance at its family shelter intake center, known as PATH. The number of HRA staff assigned to Homelessness Diversion will double, ensuring all applicants receive counseling to explore all of the resources which are available to avert shelter placement. In addition, HomeBase staff will be on-site to help clients access homelessness prevention resources, including help for those at-risk of eviction.
Next Step Shelter Models
While the standard shelter model serves a majority of our clients well, some clients need additional support and enriched services in order to make the transition from shelter to independent living. DHS’ Next Step model is based on intensive case management and a more structured approach. There is a smaller client to case worker ratio, providing the more individualized attention these clients need. Staff will be available to provide more one-on-one support, such as accompanying clients to housing or other appointments and helping them overcome barriers to permanency. The Next Step model revolves around the fundamental belief that clients are best served living independently in their communities and works intensively to achieve this goal. Next Step is available at select family shelters currently and will be rolled out at select adult shelters by July 1.
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