Moving to Work

Retrospective

A Picture of Moving to Work

Agencies’ Housing Assistance

Moving to Work Agencies’

Use of Funding Flexibility

Housing Choice and Self-

Sufficiency Outcomes at

Moving to Work Agencies

The Impact of the Moving to

Work Demonstration on the

Per Household Costs of

Federal Housing Assistance

Evaluating the Effects of

Santa Clara County Housing

Authority’s Rent Reform

Moving to Work Agencies’

Use of Project-Based

Voucher Assistance

U.S. Department of Housing and Urban Development | Office of Policy Development and Research Resear

Visit PD&R’s website

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to find this report and others sponsored by HUD’s Office of Policy Development and Research (PD&R). Other services of HUD USER, PD&R’s research information service, include listservs, special interest reports, bimonthly publications (best practices, significant studies from other sources), access to public use databases, and a hotline (800-245-2691) for help accessing the information you need.

Evaluating the Effects of

Santa Clara County Housing

Authority’s Rent Reform

Final Report

Prepared for

U.S. Department of Housing

and Urban Development

Washington, D.C.

Prepared by

Nina Castells

MDRC

April 2020

Acknowledgments

Acknowledgments

The evaluation was sponsored by the Office of Policy Development and Research in the U.S.

Department of Housing and Urban Development (HUD) and was part of a broader Moving to Work (MTW) evaluation led by Diane Levy at the Urban Institute. At HUD, I am especial y grateful to Elizabeth Rudd, the government technical representative for the MTW retrospective evaluation, who provided guidance and very thoughtful feedback throughout the study. Elaine Ng, regional economist at the HUD San Francisco office, shared helpful insights on the labor and housing markets of counties in the Bay Area, which provided important context for selecting appropriate comparison sites and interpreting study findings.

This report reflects the efforts and important contributions of the study team at MDRC. James Riccio and Nandita Verma—the project director and project manager—provided valuable guidance and support throughout, from the research design to their careful reviews of each draft of this report. Howard Bloom, the senior technical reviewer, worked closely with the study team on developing the methodology and providing guidance and advice throughout the analysis. I am very grateful for the critical insights and expertise that he contributed. Gordon Berlin also provided critical advice on the report and its findings. Audrey Yu and Kali Aloisi careful y processed and analyzed all the earnings data and housing subsidy data for the study and contributed many important insights on the data to the interpretation of the findings. Jennie Kaufman skil ful y edited the report. David Long from Princeton Policy Associates also contributed important insights during the research design, analysis, and report writing phases of the study.

This report has benefited greatly from the insights of the staff at the MTW housing agencies included in this study, particularly the Santa Clara County Housing Authority (SCCHA). Katherine Harasz, the executive director of SCCHA, and Janine Burrier, the assistant director of housing, generously shared extensive details about the housing agency’s policies and safeguards and the policy and economic context in which the SCCHA rent reform was implemented. Jennifer Rainwater at the Housing Authority of the County of San Mateo and Dominica Henderson at the Oakland Housing Authority also shared important information on their agencies’ policies and the housing and employment contexts where their housing agencies were located.

Disclaimer

The contents of this report are the views of the contractor and do not necessarily reflect the views or policies of the U.S. Department of Housing and Urban Development or the U.S. Government.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform

Foreword

Foreword

The Moving to Work (MTW) demonstration, authorized by Congress in 1996, gives selected public housing agencies (PHAs) and the Secretary of Housing and Urban Development (HUD) flexibility to implement innovative approaches to providing housing assistance. PHAs chosen to participate in the demonstration may enact certain policies otherwise not al owed by law, but only if those policies are intended to achieve one or more of the MTW demonstration’s three statutory objectives: to achieve greater cost effectiveness, promote self-sufficiency among assisted families, and increase housing choice for low-income families. Since the demonstration’s launch, housing authorities with MTW status have served as a laboratory for HUD policy, designing and testing a range of new approaches to delivering housing assistance. In 2015, HUD launched the MTW

Retrospective Evaluation to assess the MTW demonstration as a whole. This report is one of six produced by that effort and is an excel ent example of how MTW can be used to test variations in rent policy and learn from the experience.

In 2013, the Santa Clara County Housing Authority (SCCHA) faced a budget shortfall due to sequestration. To avoid terminating families from assistance, SCCHA sought to reduce the costs of housing assistance payments in its Housing Choice Voucher (HCV) program by increasing the proportion of income that assisted households paid toward rent. Most HUD-assisted households nationwide pay 30 percent of their adjusted income towards rent (as required by law), but there have been numerous proposals to increase that proportion so that HUD could serve more families at a lower cost. One concern voiced by researchers and advocates is that doing so might backfire, that the increased “tax” on earnings might lead assisted households to work and earn less, paradoxically increasing the cost per household of housing assistance.

SCCHA initial y raised the tenant contribution rate for all HCV households from 30 percent of adjusted income to 35 percent of gross income, then dropped the rate a year later to 32 percent of gross income. HUD recognized SCCHA’s actions as an opportunity to find out what could happen in the real world when assisted households paid more than 30 percent of their adjusted income for rent and funded a study of the impact of SCCHA’s new rent policy on employment, earnings, and housing subsidies. To detect impacts, the study compared work-able HCV recipients at SCCHA to HCV recipients at three nearby PHAs who were not affected by the rent reform. The study tracked employment, earnings, and housing subsidy for 4 years after SCCHA implemented the new rent policy. The comparison showed that SCCHA’s rent increase did not affect average employment Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform iii

Foreword

and earnings of work-able HCV households, indeed, HCV households in the study PHAs worked and earned more over the observation period. SCCHA met its objective of serving the same number of families at a lower cost. The study did not assess whether families reduced spending, increased debt, and experienced material hardship.

MTW flexibility enabled SCCHA to respond immediately to a sudden budget shortfall by adjusting rent contributions, and it al owed the agency to serve the same number of families at a lower cost.

HUD’s proposed Making Affordable Housing Work Act (MAHWA), submitted to Congress in April 2018, would al ow all PHAs similar flexibilities. Additional y, because the flexibility to tailor activities to local conditions and adjust rapidly to changing conditions has proven valuable to current MTW

agencies, HUD is adding 100 new MTW agencies, including 30 in rural communities. So that we can learn as much as possible from the MTW expansion, participating housing agencies wil be part of a systematic program of research to test various policies, including different rent policies and work requirements. The reports produced by the MTW retrospective evaluation form a foundation that HUD will continue to build on as we seek more cost-effective ways to house our neediest and lowest-income families.

Seth D. Appleton

Assistant Secretary for Policy Development and Research

U.S. Department of Housing and Urban Development

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform iv

Contents

Contents

Abstract ........................................................................................................................................ ix

Executive Summary ...................................................................................................................... xi

Introduction and Background ....................................................................................................... 1

Introduction ....................................................................................................................................................................... 1

Background ....................................................................................................................................................................... 3

Existing Evidence About the Effects of Housing Subsidies on Employment and Earnings ........................ 7

Research Design ........................................................................................................................... 11

Research Questions ....................................................................................................................................................... 11

Study Sample ................................................................................................................................................................... 15

Study Period ..................................................................................................................................................................... 17

Data Sources .................................................................................................................................................................... 17

Analytic Approach ........................................................................................................................................................... 22

Comparison Group Selection ....................................................................................................................................... 26

Findings ........................................................................................................................................ 35

Impacts on Employment and Earnings ...................................................................................................................... 35

Impacts on Housing Subsidies .................................................................................................................................... 40

Households’ Housing Decisions and Rent Burden ................................................................................................ 43

Subgroup Findings .......................................................................................................................................................... 45

Discussion .................................................................................................................................... 53

Discussion of Findings ................................................................................................................................................... 53

Conclusion ......................................................................................................................................................................... 56

Appendix A ................................................................................................................................... 59

Appendix B ................................................................................................................................... 61

Appendix C ................................................................................................................................... 67

Appendix D ................................................................................................................................... 71

Appendix E ................................................................................................................................... 73

Appendix F ................................................................................................................................... 75

Appendix G ................................................................................................................................... 79

References ................................................................................................................................... 95

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform v

List of Exhibits

List of Exhibits

Exhibit ES.1 Impacts on Average Quarterly Employment Rate and Annual Earnings

(Nonelderly, Nondisabled Adults) ......................................................................................................................... xiv

Exhibit ES.2 Impacts on Housing Subsidies (Nonelderly, Nondisabled Households) ......................... xv

Exhibit 1.1 The Moving to Work Retrospective Evaluation ............................................................................. 2

Exhibit 1.2 General Housing Policy Terms .......................................................................................................... 4

Exhibit 1.3 Total Tenant Payment as a Percentage of Monthly Gross Income Among

Nonelderly, Nondisabled Households Receiving Subsidies ........................................................................ 5

Exhibit 2.1 Definitions of Housing Subsidy Measures Used in Present Study ........................................ 13

Exhibit 2.2 Definitions of Other Housing Subsidy Terms .............................................................................. 13

Exhibit 2.3 HUD Definitions of Sample Terms .................................................................................................. 16

Exhibit 2.4 Timeline of Policy Changes ............................................................................................................... 17

Exhibit 2.5 Comparison Group Selection ........................................................................................................... 27

Exhibit 2.6 Map of Santa Clara and Comparison Counties ........................................................................... 28

Exhibit 2.7 Baseline Trends in Quarterly Employment Rates of Nonelderly, Nondisabled Adults in

the Santa Clara County Housing Authority and Selected Comparison Housing Agencies ............... 30

Exhibit 2.8 Baseline Trends in Average Quarterly Earnings of Nonelderly, Nondisabled Adults in

the Santa Clara County Housing Authority and Selected Comparison Housing Agencies ............... 31

Exhibit 2.9 Sample Sizes and Slopes of Candidate Comparison Public Housing Agencies .............. 31

Exhibit 2.10 Characteristics of the Sample at Baseline (Nonelderly, Nondisabled Households

and Adults) ................................................................................................................................................................... 32

Exhibit 3.1 Quarterly Employment Rates for Nonelderly, Nondisabled Adults in Santa Clara County

Housing Authority ....................................................................................................................................................... 36

Exhibit 3.2 Quarterly Employment Rates for Nonelderly, Nondisabled Adults in the Comparison

Group Housing Authorities ..................................................................................................................................... 36

Exhibit 3.3 Quarterly Employment Rates for Nonelderly, Nondisabled Adults in the Santa Clara

County and Comparison Group Housing Authorities ..................................................................................... 37

Exhibit 3.4 Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Santa Clara

County Housing Authority ....................................................................................................................................... 37

Exhibit 3.5 Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Comparison

Group Housing Authorities ..................................................................................................................................... 38

Exhibit 3.6 Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Santa Clara

County and Comparison Group Housing Authorities ..................................................................................... 38

Exhibit 3.7 Impacts on Average Quarterly Employment Rate and Annual Earnings of Nonelderly,

Nondisabled Adults ................................................................................................................................................... 39

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform vi

List of Exhibits

Exhibit 3.8 Impacts on Housing Subsidies (Nonelderly, Nondisabled Households) ............................ 41

Exhibit 3.9 Tenant Rent Share as a Percent of Monthly Gross Income Among Nonelderly,

Nondisabled Households Receiving Subsidies ............................................................................................... 44

Exhibit 3.10 Characteristics of the Sample at Baseline by Policy Group (Nonelderly, Nondisabled

Households and Adults) ........................................................................................................................................... 46

Exhibit 3.11 Impacts on Average Quarterly Employment Rate and Annual Earnings by Policy

Change Subgroup for Nonelderly, Nondisabled Households ..................................................................... 48

Exhibit 3.12 Tenant Rent Share as a Percent of Monthly Gross Income Among Nonelderly,

Nondisabled Households Receiving Subsidies, by Policy Subgroup in Santa Clara County

Housing Authority ...................................................................................................................................................... 51

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform vii

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform viii

Abstract

Abstract

This study examines the effects of a rent reform in the Santa Clara County Housing Authority (SCCHA) on Housing Choice Voucher (HCV) residents’ employment rates, average earnings, and housing subsidies using a quasi-experimental design. In the face of federal budget cuts to the HCV program in 2013, SCCHA reduced subsidies for all households rather than cutting some households from the program. The primary component of its rent reform was to increase the tenant rent contribution rate from 30 percent of adjusted income (equivalent to about 27 percent of gross income) to 35 percent of gross income (eliminating all deductions and al owances) for al subsidy households. A risk was that if tenants reduced their earnings in response to the higher

“tax” rate (since they keep a smal er portion of their earnings under the new policy), their subsidies would increase, counteracting the housing agency’s expected savings from increasing tenant rent contributions. A second rent reform component changed the voucher size policy, which resulted in a smal er voucher size (fewer bedrooms) for some households. The findings indicate that, on average, the SCCHA rent reform did not affect residents’ employment rates and average earnings throughout the 4 years fol owing the implementation of the rent reform. Thus, the rent reform reduced households’ average housing subsidies as intended, and SCCHA was able to meet its projected savings. Since households did not increase their earnings to compensate for the reduction in their subsidies, these findings suggest that households absorbed their increased housing costs; however, whether they did so by reducing spending on necessary goods or by increasing debt and whether they experienced increased material hardship is unknown.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform ix

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform x

Executive Summary

Executive Summary

smal er voucher size (fewer bedrooms) for

some households.

The results of this study suggest that the

Over 2 mil ion households receive federal

SCCHA rent reform did not affect residents’

housing subsidies that al ow them to rent in

employment rates and earnings, on

the private rental market. The Housing Choice

average, throughout the 4 years fol owing

Voucher (HCV) program, funded by HUD,

the implementation of the rent reform.

requires households to pay 30 percent of

The analysis also found that, as expected

their income toward rent, and HUD subsidizes

given the nature of the policy changes

the remaining amount of the households’

and the absence of effects on residents’

rent up to a certain threshold based on area

earnings, the SCCHA rent reform reduced

housing costs. This rent policy aims to protect

the average housing subsidy that the PHA

assisted households from excessive rent

paid on behalf of households. It did not find

burden, but critics argue that pegging tenant

any evidence of an overall effect on the

contributions to income creates a disincentive

percentage of households still receiving any

to work. A rent reform that reduces housing

housing subsidies during the fol owup period.

subsidies and increases households’

The SCCHA rent reform, however, may

contributions to rent might therefore have

have reduced earnings for a subset of this

effects on employment. This report examines

population—the households affected by the

the effects of one such reform on subsidy

change in the voucher size policy in addition

recipients’ employment rates, average

to the increase in the tenant contribution rate.

earnings, and housing subsidies.

The HUD Moving to Work (MTW)

The Santa Clara County

demonstration, launched in 1996, grants 39

Housing Authority Rent

selected public housing agencies (PHAs) the

flexibility to implement strategies to increase

Reform

cost-effectiveness, promote household self-

SCCHA increased its tenant contribution

sufficiency, and increase housing choice

rate to the level at which the total savings

for assisted households.1 These PHAs have

from lower subsidies would al ow the PHA to

special statutory authority to change many

continue to serve all households in the HCV

HCV program rules, including rent rules.2 The

program at that time. SCCHA’s projections

present study evaluates the impact of a rent

of savings assumed that the increase in the

reform made by one PHA, the Santa Clara

tenant contribution rate would not cause

County Housing Authority (SCCHA), using

residents of HCV households to work or earn

its MTW flexibility. In 2013, federal budget

less. They had little evidence on which to

cuts significantly reduced the budget for

base these projections, however. Economic

PHAs operating HCV programs. To avoid

theory suggests multiple possibilities: On the

having to terminate households from the

one hand, increasing the tenant contribution

HCV program, SCCHA chose to increase

rate effectively increases the “tax” on

the tenant rent contribution rate from 30

tenants’ earnings (in other words, tenants

percent of adjusted income to 35 percent

keep a smal er portion of their earnings under

of unadjusted income.3 It also changed the

the new policy compared with the former

voucher size policy, which resulted in a

policy), creating a disincentive to work. If

1 In 2016, Congress authorized HUD to expand the MTW demonstration to grant MTW status to 100 additional PHAs.

2 Subject to public notification, approval of each PHA’s board of directors, and HUD approval.

3 This change was tempered in 2014 when the rate was reduced to 32 percent of gross income, but this is still substantial y higher than the previous rate.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform xi

Executive Summary

tenants did reduce their earnings, it would

In anticipation of the potential hardship that

have resulted in SCCHA having to increase

HCV households might face because of the

the subsidy levels, effectively counteracting

rent reform, SCCHA offered two safeguards:

the savings in housing assistance payments

hardship exemptions for households that

the housing agency hoped to achieve. On

experienced a sharp increase in rent share

the other hand, tenants who can work may

because of the new rent calculation, and

increase their employment to compensate for

financial and legal assistance for households

the loss of net income. A third possibility is

at risk of eviction due to the rent reform.

that households may absorb their increased

The hardship exemption policy al owed

housing costs without changing their

households to have childcare or medical

employment behavior, by reducing their

deductions temporarily included in the

spending or incurring debt.

calculations for their total tenant payment

(TTP) for a 90-day period. The eviction

The SCCHA rent reform consisted of two

prevention assistance program provided

main policy changes:

financial assistance to cover unpaid rent or

• It increased the tenant contribution rate

to cover a security deposit if a household

from 30 percent of adjusted income

had to move because of the rent reform. The

(equivalent to about 27 percent of

program also included free legal services to

unadjusted income) to 35 percent of

prevent eviction.

unadjusted income. After 1 year, this

percentage was reduced to 32 percent

Data and Methods

of unadjusted income. This policy change

eliminated all allowances and deductions,

The study sample includes the cohort of

including dependent and childcare

nonelderly, nondisabled adults who were

allowances, deductions for medical

receiving HCV subsidies from the SCCHA

expenses, and utility allowances. This

program or one of the three selected

new rent policy was applied to the rent

comparison PHAs at the time the SCCHA rent

calculations for all HCV households.

reform was implemented in July 2013. The

comparison PHAs are the Housing Authority

• It changed the policy that determines

of the County of Alameda, the Housing

the number of bedrooms on a

Authority of the County of San Mateo, and

household’s voucher. Under the former

San Francisco Housing Authority. The effects

policy, household members of different

of the rent reform are examined for up to 4

generations, of the opposite sex over

years after the rent reform. The analysis uses

the age of 5 years old, and unrelated

state unemployment insurance wage data

adults (other than significant others) were

to measure employment rates and average

al ocated separate bedrooms. The new

earnings and HUD’s Inventory Management

policy al ocated one bedroom to the head

System/PIH Information Center data to

of household (with spouse or partner) plus

measure households’ housing subsidies and

one additional bedroom for every two

housing characteristics.

persons regardless of age, generation,

relationship, or gender. This policy change

To estimate effects of the SCCHA rent

resulted in a smal er voucher size for 23

reform on the study’s key outcomes—

percent of all SCCHA households (not

employment and earnings—a comparative

including senior households or households

interrupted time series (CITS) analysis, a

with people with disabilities).

quasi-experimental design, is used. The CITS

analysis uses the trends in earnings and

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform xii

Executive Summary

employment before the SCCHA rent reform

behavior, and how does it affect households’

for the SCCHA group and a comparison

housing outcomes? The fol owing are key

group and measures how each group

findings from the study’s quasi-experimental

deviates from its pre-rent reform trend. The

analyses.

impact is the difference between the two

groups’ post-rent-reform deviations from

• The SCCHA rent reform did not, on

their respective pre-rent reform trends.

average, affect residents’ employment

rates and average earnings throughout

To study the effects of the SCCHA rent

the 4 years following the implementation

reform on housing subsidy amounts and

of the rent reform.

the percentage of households continuing

Exhibit ES1 presents the estimated effects

to receive subsidies, the study uses an

of the SCCHA rent reform on average

autoregressive difference-in-difference

annual employment rates and average

method.4 A difference-in-difference

annual earnings for nonelderly, nondisabled

estimation compares the change in each

adults for each year of the fol owup

outcome between the period before the

period. The results show no evidence of

SCCHA rent reform and each year fol owing

effects on the percentage of nonelderly,

the rent reform for SCCHA households

nondisabled adults who were employed

with the change for households in the

or on their average earnings across the 4

comparison PHAs, where no rent reform was

years of fol owup. In Year 1, for example,

implemented at the time. The models used

50.8 percent of SCCHA households had

in the present study are autoregressive in

some earnings in a given quarter, which

that they also control for pre-intervention

is estimated to be only 0.5 percentage

values of the outcome measures. Although

point lower than what it would have been

difference-in-difference is a widely used

in the absence of the SCCHA rent reform,

quasi-experimental approach, it is less

and the impact estimate is not statistically

rigorous than CITS because it does not

significant. If, as these findings suggest,

account for potential y differing baseline

households did not increase their earned

trends in outcomes for the treatment and

income to compensate for the reduction in

comparison groups.

their housing subsidies, they would have

Additional descriptive analyses were used to

experienced reductions in their net income.

explore changes in housing characteristics

For households that did not increase their

before and after the rent reform that may be

income over time, these reductions in

related to households’ housing decisions,

net income could have been persistent.

including unit characteristics, household

Households who did increase their income

composition, neighborhood poverty, and

over time would have experienced smal er

rent burden.5

increases in net income compared with the

increases they would have experienced in

the absence of the rent reform.

Key Findings

• The SCCHA rent reform reduced the

The present study primarily aims to answer

average housing subsidy that the PHA

two questions: How does an increase

paid on behalf of households.

in tenant rent share affect tenants’ work

4 It was not feasible to use the CITS method to estimate the effects of the rent reform on housing subsidy amounts and continued housing subsidy receipt during the fol owup period, because housing subsidy data were not available for the full sample for the 4 years before the rent reform.

5 It was not feasible to use a difference-in-difference analysis for these analyses because data on these outcomes were available only for households that were still receiving subsidies, and not all households continued to receive subsidies for the full 4 years after the implementation of the rent reform.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform xiii

Executive Summary

Exhibit ES.1 Impacts on Average Quarterly Employment Rate and Annual Earnings (Nonelderly, Nondisabled Adults) Outcome

SCCHA Rate or Average

Estimated Effect

P-Value

Employment Rate

Year 1

50.8

-0.5

0.604

Year 2

54.5

0.0

0.972

Year 3

56.6

0.1

0.929

Year 4

57.5

0.1

0.941

Earnings (2017 $)

Year 1

11,187

46

0.897

Year 2

13,549

143

0.763

Year 3

16,198

200

0.738

Year 4

18,538

509

0.484

Sample Size

34,075

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Impacts were estimated using a comparative interrupted time series model. The impact estimates represent the estimated amount by which the SCCHA actual employment rates or average earnings deviate from the predicted employment rates or earnings levels in the absence of the rent reform. All earnings impacts are reported in 2017 dollars. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as: *** = 1 percent; ** = 5 percent; * = 10 percent.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit ES2 presents the estimated effects

household subsidy was $1,548 less annually

of the SCCHA rent reform on the average

than it would have been in the absence of

amount of housing subsidy and the

the rent reform. In the third year, the rent

percentage of households receiving any

reform reduced the annual subsidy by $1,329.

housing subsidy at the time of fol owup.6

The average household housing subsidy

Overal , there is no clear evidence that

in the month before the implementation of

the SCCHA rent reform influenced the

the rent reform was $16,764 per year. As

percentage of households that lost their

expected, the SCCHA rent reform reduced

subsidies or left the subsidy program. This

the average amount of housing subsidy that

finding suggests that the increased tenant

households received. This effect is probably

contribution did not drive housing subsidy

a direct result of the increase in the tenant

amounts down to zero for a large proportion

contribution rate from 30 percent of adjusted

of households and that the increased rent

income to 35 percent of gross income and

burdens did not lead a large proportion of

the other policy changes implemented

households to leave the housing subsidy

as part of the rent reform. In the first year

program.

after the rent reform was implemented,

• The SCCHA rent reform may have reduced

the average annual household subsidy

earnings for a subset of the population—the

was estimated to be $1,593 less than it

households that were affected by the change

would have been in the absence of the rent

in the voucher size policy in addition to the

reform. In the second year, when the tenant

increase in the tenant contribution rate.

contribution rate was reduced to 32 percent,

the effect was slightly smal er: The average

A subgroup analysis estimated effects of

the SCCHA rent reform separately for the

6 Effects on housing subsidies were estimated for nonelderly, nondisabled households. A nonelderly, nondisabled household is defined as a household where the head of household and any spouse or co-head are under 62 years old and not disabled.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform xiv

Executive Summary

Exhibit ES.2 Impacts on Housing Subsidies (Nonelderly, Nondisabled Households) Outcome

SCCHA Average or Rate

Estimated Effect

P-Value

Total Annual Housing Subsidy ($)

Year 1

14,335

-1,593

0.000***

Year 2

13,414

-1,548

0.000***

Year 3

13,481

-1,329

0.000***

Any Housing Subsidy Receipt (%)

Year 1

99.2

0.5

0.013**

Year 2

92.9

-0.4

0.368

Year 3

87.5

-0.9

0.137

Sample (Total = 15,490)

7,109

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies (PHAs) consists of the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo's housing subsidy measures.

Sample sizes may vary because of missing values. Impacts were estimated using an autoregressive difference-in-difference model, controlling for the past receipt of housing subsidies and other baseline characteristics of sample households. The impact estimates represent the estimated amount by which the SCCHA annual housing subsidy or housing subsidy receipt deviate from the predicted levels in the absence of the rent reform. To assess differences between the research groups, chi-square tests were used for categorical variables and two-tailed t-tests were used for continuous variables. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as: *** = 1 percent; ** = 5 percent; * = 10 percent.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data residents who were affected only by the tenant over the fol owup period were rising for both contribution rate change (77 percent of the

SCCHA and the comparison group, so this

study sample) and the residents who were

estimated negative effect on average earnings

affected by the voucher size rule change in

means that for SCCHA residents in this group,

addition to the tenant contribution rate change earnings did not increase as quickly or as (23 percent).7 The findings for the residents

much as they would have in the absence of

affected only by the tenant contribution rate

the rent reform. Descriptive findings (which

increase mirror the estimated effects on the

do not indicate causality) suggest that some

full sample: there was no evidence of effects

households in this subgroup moved to units

of the rent reform on employment rates or

with fewer bedrooms after the rent reform, but

average earnings through the 4 years of

that levels of rent burden for this subgroup

fol owup. The residents also affected by the

were especial y high fol owing the rent reform.

voucher size rule change, however—who

A tight housing market in Santa Clara may

faced especially deep cuts in their housing

have made it difficult for some families to

subsidies and very high levels of rent burden if find new housing with fewer bedrooms at an they did not move to smal er units—may have

affordable rent.

reduced their earnings in response to the rent

reform. The negative effect on earnings for

Conclusion

this subgroup is statistical y significant in Years

3 and 4 fol owing the policy change, at about

The present study of the effects of a rent

$2,200 and $2,340 respectively, suggesting

reform implemented by SCCHA provides

that some residents affected by both policy

evidence, from one location, that rent policies

changes may have reduced their employment

that increase the tenant contribution rate

by this time. Employment and earnings trends

by a moderate amount (from 30 percent of

7 One limitation of this analysis compared with the ful -group analysis is that it was only possible to include one of the three selected comparison group PHAs in the comparison group.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform xv

Executive Summary

adjusted income to 35 percent of gross

households’ material hardship beyond a

income, later to 32 percent of gross income)

measure of rent burden, and therefore

do not create a substantial disincentive to

cannot assess how this increase in rent

work or significantly increase the likelihood

burden translated into their experiences with

that households may lose their subsidies.

material hardship.

It also provides suggestive evidence that

implementing a voucher size policy that

It is important to understand how this type

requires some households to relocate to a

of rent reform may be expected to vary

different unit (with fewer bedrooms) to avoid

based on the context, and studies in multiple

even deeper cuts in housing subsidies may

locations that represent diverse housing and

have adverse effects on some households

labor markets are needed to examine this

in the context of a housing market where

question. Future studies of rent reforms that

affordable housing options are very limited,

might result in reduced housing subsidies

and that short-term safeguards that PHAs

should also careful y measure households’

provide to households may not ful y prevent

experiences with material hardship, including

longer-term hardship.

food insecurity and their ability to cover

medical expenses.

The findings from the present study cannot

predict how tenants may change their

Nevertheless, the present study begins

work behavior if the size of their tenant

to address one aspect of housing subsidy

contribution rate increases by a larger

policy—how increasing the tenant

amount than what was implemented in

contribution rate affects households’

SCCHA. Although the increase from 30

employment, earnings, and housing

percent of adjusted income to 35 percent

subsidies—where strong evidence is lacking.

of gross income (and later 32 percent of

Two additional studies are currently under

gross income) did not, on average, change

way that also evaluate changes in how

employment or earnings among SCCHA

tenant rent share is determined: The HUD-

tenants, it is possible that a higher increase

funded Rent Reform demonstration tests a

may affect tenants’ work behavior. The

rent reform model in four PHAs that caps the

negative effects on earnings that were

tenant contribution toward rent for 3 years,

found for the group of households that were

and the second cohort of the HUD study of

affected by both the tenant contribution rate

the current MTW expansion is intended to

increase and the voucher downsizing—and

investigate the effects of tiered rents (where

therefore experienced particularly deep cuts

tenant rent share is determined based on

in their housing subsidies—are suggestive of

which income band household income falls

this possibility.

into) and stepped rents (where tenant rent

share is increased by a set amount at regular

The combination of findings that the SCCHA

intervals according to a rent share schedule)

rent reform led to deep and lasting cuts

in 10 PHAs with newly granted MTW status.

in housing subsidies for households and

Taken together, this set of studies will build a

that, on average, household members did

body of evidence that will inform future HUD

not increase their earnings to compensate

and PHA decisions about the most effective

for the reduction in subsidies means that

rent policies to implement.

households absorbed their higher housing

costs. Therefore, households’ material

hardship is an important consideration.

This study did not include measures of

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform xvi

Chapter 1. Introduction and Background

Chapter 1

demonstration, four PHAs are testing an

alternative rent policy that lengthens the

Introduction and

recertification period and simplifies the

rent calculation, and MDRC is evaluating

Background

the effects on tenants’ employment and

earnings and the PHAs’ administrative

efficiency. In 2016, Congress authorized

HUD to expand the MTW demonstration to

Introduction

grant MTW status to 100 additional PHAs,

and as mandated by Congress, HUD wil

The HUD Housing Choice Voucher (HCV)

evaluate the effects of MTW innovations

program is the nation’s primary rental

(including alternative rent policies).

subsidy program, assisting approximately

2.2 mil ion low-income households in paying

The present study contributes to this

for housing in the private rental market. HCV

emerging body of evidence on the effects

households generally pay 30 percent of their

of alternative rent policies in subsidized

income toward rent, and HUD subsidizes

housing by evaluating the impact of a

the remaining amount of the households’

rent reform at one PHA, the Santa Clara

rent up to a certain threshold based on

County Housing Authority (SCCHA). This

area housing costs. This rent policy aims to

study is part of a broader HUD-sponsored

protect assisted households from excessive

retrospective evaluation of the MTW

rent burden, but critics of the policy argue

demonstration led by the Urban Institute.9

that pegging tenant contributions to income

In 2013, federal budget cuts significantly

can disincentivize work and that public

reduced the SCCHA budget for HCVs,

housing agencies (PHAs) find it burdensome

and SCCHA no longer had sufficient funds

to administer.

to continue to provide subsidies to al

households in the HCV program at the same

HUD’s Moving to Work (MTW)

level as before. To avoid having to terminate

demonstration, launched in 1996, grants

households from the HCV program,

selected PHAs the flexibility to implement

SCCHA chose to increase the tenant rent

strategies to increase cost-effectiveness,

contribution rate from 30 percent of adjusted

promote household self-sufficiency, and

income (equivalent to about 27 percent

increase housing choice for assisted

of gross income) to 35 percent of gross

households. These PHAs have special

income.10 It also changed the voucher size

statutory authority to change many HCV

policy—the set of rules used to determine

program rules, including rent rules.8 Of

the number of bedrooms that a household’s

the 39 PHAs with MTW status, 20 had

subsidy is based on—which resulted in a

implemented rent reforms as of 2014

smal er voucher size for 17 percent of all the

(Khadduri et al., 2014). These changes to

SCCHA HCV households.

rent policies provide an opportunity to test

alternatives to the traditional 30-percent-of-

SCCHA chose to increase its tenant

income policy and better understand how

contribution rate to the level at which the

alternative rent policies affect residents.

total savings from lower subsidies would

For example, through HUD’s Rent Reform

al ow the PHA to continue to serve al

8 Subject to public notification, approval of each PHA’s Board of Directors, and HUD approval.

9 See exhibit 1.1 for a summary of other reports included in this study.

10 This change was tempered in 2014 when the rate was reduced to 32 percent of gross income, although this is still substantial y higher than the previous rate.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 1

Chapter 1. Introduction and Background

households in the HCV program at that time.

rate to affect tenants’ employment and

SCCHA’s projections of savings assumed

earnings, SCCHA assumed no effects on

that the increase in the tenant contribution

earnings when designing its rent reform.

rate would not cause residents of HCV

households to work or earn less. They

The SCCHA rent reform offered an

had little evidence on which to base these

opportunity to assess the effects of

projections, however.

increasing the tenant contribution rate on

their employment behavior and housing

Economic theory suggests multiple

outcomes. The present study analyzed

possibilities: On the one hand, increasing

employment, earnings, housing subsidy,

the tenant contribution rate effectively

and housing characteristics of the group

increases the “tax” on tenants’ earnings (in

of nonelderly, nondisabled SCCHA tenants

other words, tenants keep a smal er portion

who were receiving HCV subsidies when the

of their earnings under the new policy

SCCHA’s rent reform was implemented (July

compared with the former policy), creating

2013) for the 4 years before the rent reform

a disincentive to work. On the other hand,

was implemented, and then fol ows them for

tenants who are able to work may increase

up to 4 years after the rent reform.11

their employment to compensate for the

loss of net income. A third possibility is that

This report begins with background on

households may absorb their increased

traditional HUD policies and details on the

housing costs without changing their

SCCHA rent reform. It then reviews existing

employment behavior, by reducing their

evidence on the effects of housing vouchers

spending or incurring debt. Without an

and changes to the traditional HUD rent

evidence base to indicate how a PHA could

rules on tenants’ labor market outcomes.

expect changes in the tenant contribution

The second chapter defines the study’s

Exhibit 1.1 The Moving to Work Retrospective Evaluation

The HUD-sponsored Retrospective MTW Evaluation includes six reports and an online data feature that examine different aspects of the MTW program and MTW agencies’ activities and performance under the program’s three statutory objectives.

A Picture of Moving to Work Agencies’ Housing Assistance describes MTW agencies, the assistance they provided, and the characteristics of the households they served in 2008 and 2016. A related online data feature provides access to MTW agency-level data.

Moving to Work Agencies’ Use of Funding Flexibility examines how agencies have used MTW funding flexibility, alone and with regulatory waivers, and categorizes funding flexibility activities by their primary objectives—cost effectiveness, self-sufficiency of assisted households, or increased housing choice for low-income families. The study includes an indepth examination of funding shifts for a subgroup of eight agencies.

Housing Choice and Self-Sufficiency Outcomes at Moving to Work Agencies examines the extent to which MTW agencies meet two of the program’s three statutory objectives, increasing housing choice and promoting self-sufficiency for assisted households.

The Impact of the Moving to Work Demonstration on the Per Household Costs of Federal Housing Assistance examines how MTW

status affects the costs, to HUD, of providing housing assistance to households in the public housing and Housing Choice Voucher (HCV) programs.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform examines the impacts on work, earnings, and housing subsidies among assisted households of Santa Clara’s unique rent reform, which increased the proportion of income that households must pay toward rent.

Moving to Work Agencies’ Use of Project-Based Voucher Assistance examines multiple aspects of MTW agencies’ use of project-based voucher (PBV) assistance, including the share of assistance and HCV budget authority devoted to PBVs, the relationships between PBVs and the Low-Income Housing Tax Credit and Rental Assistance Demonstration programs, the locations of PBV-assisted units, and case studies of three agencies’ MTW goals and activities.

11 HUD defines an elderly household as one where the head of household, spouse, or co-head is at least 62 years old. HUD defines a disabled household as a household where at least one of the members is a disabled adult (Code of Federal Regulations, 24 CFR 888.113).

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 2

Chapter 1. Introduction and Background

research questions and the rationale behind

Questions such as the one above must be

hypothesized effects. It also describes

answered even when policymakers are

the study’s research design, including the

not facing budget reductions. The HCV

study sample definition, comparison group

program is not an entitlement program, its

selection, study period, data sources,

budget is limited, and there are long waiting

and different methods used for each set

lists in most large communities served

of research questions. The third chapter

by the program. Discussions around rent

discusses the study’s findings, and the final

reform, therefore, must consider not only

chapter discusses their implications.

effects on current voucher holders, but also

effects on eligible households that are not

Background

yet served by the program. The present

study contributes to the knowledge of the

Santa Clara County is a diverse and

impact on assisted households of a rent

densely populated region in the Bay Area of

reform that decreases the subsidy received

California, located in the southern portion

by each household in order to serve more

of Silicon Val ey. Santa Clara has the fifth

households.

highest median income among U.S. counties,

and it is part of a metropolitan area with

Housing Choice Voucher Program

a very high cost of living, including an

Income-Based Tenant Rent Rules

expensive housing market (U.S. Census

Bureau, 2013).

The HCV program helps low-income families

obtain decent and safe housing in the

SCCHA implemented its rent reform in

private rental market. Housing vouchers are

response to the particular budget situation

administered locally by housing agencies

caused by the federal sequestration in 2013,

with funding from HUD. The voucher is

and at the time, other MTW PHAs considered

a housing subsidy paid directly to the

a similar response.12 Housing authorities

landlord by the agency on behalf of the

often have to respond to budget cuts, and

participating household. The household

in doing so they must confront the question:

pays the difference between the gross rent

Should they cut the number of vouchers

(the contract rent paid to the landlord plus

they provide and put many households at

utility costs) and the subsidy amount, or

risk of homelessness and severe hardship,

Housing Assistance Payment (HAP). The

or should they instead reduce the level of

voucher holder is typically responsible

housing assistance they provide to their

for a portion of the gross rent equal to 30

current voucher holders, having everyone

percent of the household’s adjusted income

share the burden—potentially increasing

(after accounting for various allowable

hardship for many more households (albeit

deductions), plus any amount by which

to a lesser degree)? At the federal level,

the gross rent exceeds the local payment

through a 2018 proposal, HUD expressed

standard.13 Allowable deductions include a

interest in a rent reform similar to the SCCHA

deduction for each dependent, a deduction

rent reform that would have increased the

for having at least one household member

tenant contribution rate from 30 percent

who is elderly or disabled, a child care

of adjusted income to 35 percent of gross

al owance for reasonable child care expense,

income (HUD, 2018).

and an allowance for medical expenses

12 The 2013 federal budget sequestration refers to a set of cuts to federal spending that was passed as part of the Budget Control Act of 2011 and went into effect March 1, 2013.

13 The payment standard is the maximum subsidy a PHA can pay on behalf of a household, and payment standards are set by the PHA between 90 and 110

percent of the area’s fair market rents (FMRs). HUD sets FMRs annual y at the 40th percentile of gross rents in the area.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 3

Chapter 1. Introduction and Background

Exhibit 1.2 General Housing Policy Terms

Brooke Amendment: The Brooke Amendment to the 1968 Housing and Urban Development Act was enacted in 1969. It amends the United States Housing Act of 1937 to cap subsidy households’ tenant rent share at 25 percent of their adjusted income. This percentage was raised to 30 percent in 1981.

Brooke Rent: The 30 percent of adjusted income that households pay toward their gross rent.

Section 8 Housing Choice Voucher Program: The Housing Choice Voucher (HCV) program is the federal government’s primary rental subsidy program, assisting approximately 2.2 million low-income households in paying for housing in the private rental market. HCV

households generally pay 30 percent of their income toward rent, and HUD subsidizes the remaining amount of the households’ rent up to a certain threshold based on area housing costs. The HCV program was enacted as Section 8 of the United States Housing Act of 1974.

for household members who are elderly or

The Santa Clara County Housing

disabled. The portion of the gross rent that

Authority Rent Reform

is equal to 30 percent of the household’s

Until September 2013, SCCHA required

adjusted income is cal ed the total tenant

its tenants to pay 30 percent of adjusted

payment (TTP), and the total amount that

income for rent (plus any amount over

the household pays toward its gross rent is

the payment standard). Then, in response

cal ed the family share. As a result, when

to federal budget cuts resulting from

tenants’ earnings increase, their share of

the sequestration in March of that year,

the rent is increased by 30 percent of the

SCCHA increased tenants’ share to 35

additional amount they earn.

percent of gross income. Under traditional

The rule that households pay 30 percent

rent rules, income is first adjusted by

of adjusted income predates the Section

subtracting various allowances and

8 program’s enactment in 1974 and was

deductions—including dependent and

based on judgment about reasonable

childcare allowances and deductions for

housing cost burden at the time (Schwartz

medical expenses—and then multiplying

and Wilson, 2008). It was initial y set at 25

the adjusted income by 30 percent to arrive

percent by the 1969 Brooke Amendment to

at the TTP. Under the new rules, the TTP is

the 1968 Housing and Urban Development

a flat 35 percent of the household’s gross

Act and was raised to 30 percent in 1981.

income with no allowances or deductions.15

This 30-percent-of-income rule is also now

SCCHA estimated that this changed

known as the Brooke rent.14 Variations of

households’ rent contribution from 27 to

this tenant contribution rate—such as the

35 percent of gross income (HACSC, 2013).

one implemented by SCCHA—have so far

In addition to eliminating deductions and

not been rigorously tested. If increasing

allowances that are subtracted from gross

the tenant portion of rent does not affect

income under traditional rules, SCCHA

households’ employment decisions and

also eliminated utility allowances, so that

does not significantly increase tenants’

households do not receive any assistance

material hardship, but does succeed in

in paying for utilities when utilities are not

reducing HAP expenditures, this could be

included in their contract rent.16 In effect,

one way of providing housing assistance to

this means that those households are paying

more families within a fixed budget amount.

even more than 35 percent of their gross

income. In September 2014, the percentage

14 See exhibit 1.2 for definitions of general housing policy terms used in this report.

15 SCCHA has a minimum tenant rent contribution of $50 that was in place before the rent reform (and before the beginning of the study period). Under both traditional and new rent rules, the tenant rent share is the greater of the calculated percentage of income or the $50 minimum rent.

16 Under the traditional rent rules, for units where utilities are not included as part of the contract rent, a utility al owance is added to the contract rent amount to calculate the gross rent. The HAP calculation is then based on this gross rent amount rather than the contract rent amount and equals the gross rent minus the household’s TTP (assuming the unit does not exceed the payment standard). Using the new rent calculation rules, the HAP is calculated as the contract rent minus the household’s TTP (again, assuming the unit does not exceed the payment standard).

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 4

Chapter 1. Introduction and Background

of gross income to be contributed was

is higher than 35 percent because for some

reduced from 35 to 32 percent. As a result

households, 35 percent of gross income

of the policy change, therefore, the overal

was below the minimum rent). It decreased

tenant contribution was drastical y increased

slightly to 35.1 percent in Year 2 because of

in 2013, then slightly decreased a year later.

the reduction in TTP from 35 percent to 32

(Neither the required contribution nor the

percent of gross income 1 year after the rent

minimum voucher standard has changed

reform was first implemented.

since that time.)

While SCCHA increased the tenant

Exhibit 1.3 shows the TTP as a percentage

contribution rate, it also changed its policy

of gross income at baseline (the last month

for determining a household’s voucher size.

before the policy change) and over the

The new policy al ocated one room for the

fol owup period for the study cohort, which

head of household (with spouse or partner)

is the measure that most directly reflects

plus one additional bedroom for every two

the rent policy changes over time.17 This

persons regardless of age, generation,

measure reflects the treatment whose effects

relationship, or gender. Before this policy

are evaluated in this study. In the month

change, the household members of different

before the rent reform was implemented,

generations (such as grandparents and their

households were paying 30 percent of

grandchildren), of the opposite sex over the

their adjusted income toward rent (up to

age of 5, and unrelated adults (other than

the unit’s payment standard) under the

significant others) were al ocated separate

traditional rent rules, which translated, on

bedrooms. For example, a household that

average, to 27 percent of gross income. The

included a household head, her 7-year-old

actual percentage during this month was

daughter, and her 9-year-old son would

30.6 percent because this average includes

have had a voucher size of three bedrooms

households for whom 30 percent of adjusted

using the old rule and a voucher size of

income (or 10 percent of gross income) is less

two bedrooms under the new policy. This

than the PHA’s minimum rent. At the end of

policy change decreased the voucher size

the first year after rent reform, tenants’ TTP

for 23 percent of nonelderly, nondisabled

was on average equal to 37.8 percent of

households served by SCCHA. In other

their gross income. (Again, this percentage

words, 23 percent of voucher households

Exhibit 1.3 Total Tenant Payment as a Percentage of Monthly Gross Income Among Nonelderly, Nondisabled Households Receiving Subsidies

TTP Among Households Receiving Subsidies (% of Monthly Gross Income)

SCCHA

Last Month of Baseline

30.6

Last Month of Year 1

37.8

Last Month of Year 2

35.1

Last Month of Year 3

34.3

Sample Size

7,109

SCCHA = Santa Clara County Housing Authority. TTP = total tenant payment.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary by year because of missing values. TTP is the minimum amount a family must contribute toward rent and utilities regardless of the unit selected. Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data 17 This measure is only available for households in the study cohort who are receiving subsidies at the time.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 5

Chapter 1. Introduction and Background

Chapter 1. Introduction and Background

were housed in a unit where the number

SCCHA also col aborated with the Law

of bedrooms exceeded the number of

Foundation of Silicon Val ey and other

bedrooms on their vouchers under the new

local organizations to create the Sequester

policy. For these households, if they didn’t

Eviction Prevention Program (SEPP) to assist

move before the effective date of the new

HCV households that were facing eviction

policy, their expected tenant contribution

because of the SCCHA rent reform. The

would sharply increase because their subsidy

program provided financial assistance to

was now based on the fair market rent (FMR)

cover unpaid rent or to cover a security

for a smal er unit than the one they occupied.

deposit if a household had to move

because of the rent reform. The program

In anticipation of the potential hardship

also included free legal services to prevent

that HCV households might face because

eviction. While the program was primarily

of the rent reform, SCCHA offered two

designed to assist households affected by

means of assistance: hardship exemptions

the voucher size rule change, the program

for households that experienced a sharp

was open to any household facing eviction

increase in rent share because of the new

because of an inability to pay the higher

rent calculation, and financial and legal

rent under the new rent policy. Households

assistance for households at risk of eviction

that experienced a substantial increase

due to the rent reform.

in their rent share (at least $300) or that

The hardship exemption policy al owed

were otherwise at risk of eviction because

households to have childcare or medical

of the rent reform were eligible to receive

deductions temporarily included in the

assistance from the program. The program

calculations for their TTP. These expenses

assisted 293 households comprising 805

were deducted from the household’s gross

people. Of those households, 260 were

income (the exemption did not include

nonelderly, nondisabled households and

other deductions, such as the dependent

therefore included in the household-level

deduction). A household was eligible to

analysis sample of the present study. SCCHA

apply for a hardship exemption if its rent

committed $500,000 of MTW funds for SEPP,

portion increased by at least $50 because of

which was supplemented with additional

the new rent calculation method. Since the

funds from the county of Santa Clara, the

households with larger deduction amounts

city of San Jose, and the Housing Trust

were most affected by the rent reform,

Silicon Val ey for a total funding commitment

eligible households consisted mostly of

of $1,820,000. Of this committed funding,

households with children under the age of 13

$808,078 was spent on the program, and all

that were paying for childcare, or elderly and

payments were made by August 2014.

disabled households. Hardship exemptions

SCCHA chose to increase the tenant

were granted to 414 households (out of 754

contribution rate, which reduced the size of

requested), most of them immediately after

the housing subsidy per household, so they

the rent reform went into effect.18 Households

could continue to provide housing assistance

that were granted the exemption paid the

to all households that were in the HCV

lower TTP for 90 days, after which it was reset

program at the time. The alternative would

to the regular amount under the new rent

have been to maintain the same percentage-

rules, based on 35 percent of the household’s

of-income amount but reduce the number

gross income with no deductions.

18 The total of 414 hardship exemptions includes exemptions for all households regardless of elderly or disabled status. SCCHA did not track elderly and disabled status of households granted hardship exemptions, so it is unknown how many of these households are in the study sample, which only includes nonelderly, nondisabled households and individuals.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 6

Chapter 1. Introduction and Background

Chapter 1. Introduction and Background

of households already in the subsidy

agency hoped to achieve. The economic

program by terminating some households’

theory behind these expectations is not

participation in the program.19

straightforward, however. Economic theory

suggests that, on the one hand, increasing

The decision by SCCHA was based partly on

the percentage of income that tenants pay

the assumption that increasing the amount

toward rent can reduce employment in

that households paid toward rent would not

response to the increased “tax” on their

substantial y reduce tenants’ employment.20

earnings (the “substitution effect” in labor

Reductions in employment would have led

economics): The tenants would gain less

to reductions in income, which would have

disposable income with each extra hour of

led to necessary increases in HAP amounts,

work than they would have in the absence

making the policy change counterproductive.

of that tax. On the other hand, households

Without any existing empirical evidence

might increase their employment to

on the effects of changing the tenant

compensate for the reduction in their subsidy

contribution rate on employment and

and maintain the level of disposable income

earnings, however, the effects of the kinds

they had before the policy change (the

of policy changes made in SCCHA on actual

“income effect” in labor economics).

HAP expenditures, households’ employment

decisions, and hardship were difficult to

While there is no prior research on changing

predict. A few years after the rent reform was

the percentage of income that households

implemented, SCCHA leadership told the

pay toward rent or total housing costs among

research team that their general impression

households already receiving subsidies,

was that, overall, voucher households did

some insight can be drawn from the existing

not seem to have changed their employment

evidence about providing housing vouchers

behavior in response to the policy, but instead

to households that had not been receiving

made do with less. Furthermore, SCCHA

housing subsidies. For such households,

achieved the HAP savings it projected using

both the income and substitution effects

the assumption that the rent reform would

point to housing subsidy receipt as a work

have no effects on employment.

disincentive.21 The income effect suggests

that providing housing subsidies can reduce

Existing Evidence About the

employment among recipients by increasing

households’ disposable income, because the

Effects of Housing Subsidies

subsidy covers a large part of the housing

on Employment and Earnings

costs that households were previously paying

Given the increase in the percentage of

for, increasing their disposable income.

income that tenants paid toward rent under

The substitution effect suggests a further

the new SCCHA rent policy, there was a risk

disincentive to work by imposing an implicit

that tenants might reduce their earnings,

“tax” on their earnings, since the 30-percent-

which would have resulted in SCCHA having

of-income rule for determining tenant rent

to increase the subsidy levels, effectively

share means that households would only

counteracting the HAP savings the housing

“take home” 70 cents for every dol ar they

earn. (This tax is in addition to the explicit

19 SCCHA also put a freeze on issuing new vouchers at the time of the 2013 rent reform, so households that left the program after the rent reform was first implemented were not replaced in the subsidy program for a few years. There were two exceptions: an al otment of 500 vouchers issued to waiting list applicants in 2015 and an al otment of 500 vouchers issued to the chronical y homeless in 2016. The voucher freeze was lifted at the end of February 2017.

20 It was confirmed in phone cal s with executive staff at SCCHA that the estimates of HAP savings that they calculated before implementing the rent reform did not account for any potential reductions in earnings from the reform.

21 See Shroder (2012) for a discussion of these and other factors and a literature review up to 2012.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 7

Chapter 1. Introduction and Background

Chapter 1. Introduction and Background

taxes earnings bring.) This “tax” is effectively

The most recent of the three studies, the

an increase from 0 percent to about 30

Family Options Study, offered vouchers

percent of the households’ income when they

to homeless families as one arm of the

begin receiving subsidies.

intervention. This study also found that

housing vouchers reduced employment

Three large-scale random assignment studies

for voucher recipients: In the short-term, 11

conducted in the past decade provide

percentage points fewer households who

reliable evidence on new housing subsidies’

were randomly assigned to receive housing

effects on households’ employment behavior

vouchers were working than was the case

and suggest some disincentive effect on

for households that were randomly assigned

employment and earnings consistent with

to the study’s control group. (Fifty percent of

the economic theory described above. The

the intervention group had any employment

first of these recent studies is the random

during the first year after random assignment

assignment evaluation of the Welfare to Work

compared with 61 percent of the control

Voucher (WtWV) program, which studied the

group.) After 3 years, this difference fell to 6

effects of receiving housing vouchers for

percentage points (64 percent of treatment

households selected from the HCV waiting

group members had any employment in

list that were receiving or had received

the prior year and a half compared with 58

Temporary Assistance to Needy Families

percent in the control group) (Gubits et al.,

(TANF). The study found that households

2015; 2016).

randomly assigned to receive a housing

voucher worked less than households who

In all three of these studies, randomly

were randomly assigned to the control

selected households were given access

group, but only during the first year fol owing

to housing subsidy programs that used

random assignment (Mil s et al., 2006).

the traditional 30-percent-of-income rent

rule. Therefore, as described earlier, these

A later study leveraged a lottery used by the

studies estimated effects of providing

Chicago Housing Authority Corporation to

housing assistance to households that

allocate newly available housing vouchers in

were not yet receiving any assistance. That

1997 (Jacob and Ludwig, 2012). This natural

research question is somewhat distinct from

experiment found more persistent negative

the question addressed by this SCCHA

impacts on labor supply. The study found

study, which examines the effects of

that receiving a voucher caused subsidy

changing rent policies for households that

recipients to reduce their employment by 6

are already receiving housing assistance

percent (4 percentage points) and reduce

under the traditional rent rules. Also, while

their quarterly earnings by 10 percent ($329

the earlier studies provide evidence for a

in 2007 dol ars). The Chicago study found

potential work disincentive from obtaining a

that the impacts were significantly larger for

housing voucher at least in the short term,

households who were not receiving TANF

this evidence does not necessarily imply

than those who were, which may be an

that reducing the housing subsidy (as in

important reason their results differed from

the SCCHA rent reform) would provide an

those of WtWV (whose sample consisted of

incentive to work. Theoretical y, as described

all TANF recipients and found less negative

earlier, an increase in the percentage of

impact on employment).22

income a household pays toward rent could

22 Both the WtWV and Chicago studies found that estimated effects varied according to several baseline characteristics, including household size and age of the household head. In Chicago, Jacob and Ludwig used their employment and income findings to estimate an income elasticity of -0.09 and a compensated wage elasticity of 0.15. In this case, the response of individuals determined by the elasticity of substitution was more important than the one caused by the elasticity of income.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 8

Chapter 1. Introduction and Background

Chapter 1. Introduction and Background

lead to a reduction in earnings due to a

directly change the percentage of income

higher “tax” on earnings (households would

that households will contribute toward rent

keep less of their earnings) or to an increase

but will provide alternative methods of

in earnings to compensate for lost income;

calculating tenant rent. The HUD Jobs Plus

the net outcome depends on which of the

Outcomes study will assess the effects of the

two effects is dominant.

Jobs Plus program, and results may provide

some insight into the effects of earnings

To date, there is no direct prior evidence

disregards combined with employment

to support either hypothesis, but there are

services. Jobs Plus is a place-based program

studies currently under way that may provide

implemented in public housing developments

insight on this question. Evidence from

that combined on-site employment-related

these studies is more directly relevant to

services and activities (including job search

the present study because they specifical y

assistance, referrals to education and training

examine the effects of changing the

programs, and support services), rent-based

percentage of income that housing subsidy-

financial incentives, and community support

assisted households are required to pay

for work. Taken together, this set of studies

toward rent. The first is the HUD-funded

that evaluate changes in how tenant rent

Rent Reform demonstration, which tests a

share is determined will build a body of

rent reform model in four PHAs that caps

evidence that will inform future HUD and

the tenant contribution toward rent for 3

PHA decisions about the most effective rent

years. During those 3 years, households’

policies to implement.

contribution toward rent does not increase

regardless of any increases in earnings

The present study is the only study to date to

during that period. The Rent Reform

assess the effects of increasing the percent

demonstration’s evaluation will provide

of income that tenants pay toward rent in a

evidence on whether this reform leads to

housing subsidy program. It examines the

increases in employment and earnings.23 An

effects of this type of rent reform on tenants’

interim report with findings on short-term

employment behavior and housing subsidies.

effects on employment and earnings and a

The study’s research questions are specified

final report with findings on long-term effects

in the next chapter.

are expected to be published later this year.

The two other related studies under way are

the HUD evaluation of the MTW expansion

and the HUD Jobs Plus Outcomes study.

The second cohort of the HUD study of

the current MTW expansion is intended to

investigate the effects of tiered rents (where

tenant rent share is determined based on

which income band household income falls

into) and stepped rents (where tenant rent

share is increased by a set amount at regular

intervals according to a rent share schedule)

in 10 PHAs with newly granted MTW status.

These rent reforms are not expected to

23 The policy, evaluation design, and PHAs’ early experiences with the new policy are described in detail in a baseline report (Riccio, Deitch, and Verma, 2017).

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 9

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 10

Chapter 2. Research Design

Chapter 2

These research questions are first

addressed for the full study sample of

Research Design

nonelderly, nondisabled adults living in

HCV-subsidized households. The study then

explores whether these effects differ for

The present study examines the effects of

households only affected by the increase in

Santa Clara County Housing Authority’s

the tenant contribution rate (77 percent of

(SCCHA) rent reform on housing subsidy

the study sample) and for the households

recipients’ employment and housing

affected by the change in the voucher size

outcomes for the cohort of nonelderly,

policy in addition to the increase in the

nondisabled adults and households

tenant contribution rate (23 percent of the

receiving HCVs in SCCHA at the time the

study sample).

rent reform was implemented in 2013. It uses

three methods to investigate its research

The remainder of this section describes

questions: a comparative interrupted

the rationale for each research question

time series design to estimate impacts on

and hypotheses that lie behind these

employment and earnings; an autoregressive

questions. It also describes the rationale for

difference-in-difference design to estimate

assessing effects separately for households

impacts on average housing subsidies and

only affected by the change in the tenant

continued subsidy receipt; and descriptive

contribution rate and households also

analyses to examine subsidy households’

affected by the voucher size rule change.

housing characteristics and rent burden

Effects on Employment and Earnings

before and after the SCCHA rent reform.

The primary research question for this study

Research Questions

is: “How did the SCCHA policy changes

affect HCV subsidy recipients’ employment

The present study primarily aims to address

and earnings?” Adults in subsidy households

the question: How does an increase in tenant

who were able to work could have

rent share affect tenants’ work behavior,

responded to the rent reform by changing

and how does it affect households’ housing

their work behavior to adjust their earnings

outcomes? This question is broken down into

(and therefore adjust their tenant contribution

the fol owing research questions:

amount and net income) in three ways:

1. What was the effect of the SCCHA

1. Households may have increased their

rent reform on household members’

employment and hours worked in response

employment and earnings?

to the policy change. Doing so could

2. What was the effect of the SCCHA rent

increase their earnings, compensating for

reform on housing assistance receipt and

all or part of the reduction in disposable

subsidy amounts?

income so they would experience less

change in their standards of living.

3. Was there any suggestion of potential

effects of the SCCHA rent reform on

2. Households may have maintained their

households’ housing decisions?

current levels of employment and hours

worked (by choice or not), either finding

4. To what extent did SCCHA households

a way to manage with less disposable

experience selected housing-related

income or perhaps experiencing increased

hardships after the rent reform?

material hardship.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 11

Chapter 2. Research Design

3. Households may have reduced their

to their pre-2013 employment level, or even

employment and earnings in response to

lower, in response to the increased “tax” on

the increased disincentive to work, namely

earnings. This study estimates the effects of

the increased “tax” on earnings, reflecting

the SCCHA rent reform on employment and

the fact that they got to keep less of each

earnings for the 4 years after the rent reform

dollar they earned than they did under the

was implemented and therefore can capture

former policy.

both immediate and longer-term effects.

In the first two scenarios, HAP expenditures

would have decreased in the amount

Effects on Average Housing Subsidy

estimated by SCCHA, and their expected

Amounts and Continued Housing

savings would have been realized.24

Subsidy Receipt

If, instead, households reduced their

The primary objective of the SCCHA rent

employment in response to an increase in

contribution increase in September 2013

the percentage dedicated to rent (the third

was budgetary. Initial y, SCCHA sought to

scenario), HAP expenditures would not have

reduce housing assistance payments and

decreased as much as expected, and SCCHA

associated administrative costs sufficiently to

would not have met its budgetary targets.

stay within its annual budget as constrained

Depending on the extent of the reduction in

by the sequestration cuts. By increasing the

employment, HAP expenditures might even

tenant rent contribution and thereby reducing

be greater than previous levels, and the policy

subsidy payment amounts for all families,

change would have been counterproductive.

SCCHA planned to continue to serve all the

households in the HCV program at the time

These different forces could have immediate

with the reduced budget. Therefore, the rent

effects (someone could reduce the number

reform was expected to have a direct effect

of hours worked because of the increased

on housing subsidies, including the average

implicit tax on earnings), or they could affect

TTP, average HAP, and average family share

decisions about employment later in the

(TTP plus any part of the gross rent that

fol owup period (someone could choose not

exceeds the payment standard).25, 26

to accept an opportunity to increase working

hours because the increase in net income

The increase in the tenant contribution

would not be as large as it would have been

rate and the decrease in housing subsidy

under the previous rent policy). It is also

payments is not necessarily a straightforward

possible that households responded to the

relationship, however. As described in the

increased tenant contribution rate differently

previous section, the SCCHA rent reform

over time. For example, households may have

could have led to various changes in

first responded to the unanticipated income

households’ employment behavior. If many

shock by working more to compensate for

households had reduced their earnings in

the lower income and to maintain longer

response to the rent reform, then average

term financial commitments, but over time

household HAP amounts may not have

they may have reduced their employment as

decreased substantial y. In other words,

they adjusted to the change, possibly down

the rent reform could have directly affected

24 The elimination of utility allowances may contribute to the income effect (as households may have to increase income to cover increased utility costs) but would not contribute to the substitution effect (reducing earnings would not increase HUD coverage of utility costs; it would only increase HAP to cover rent).

25 SCCHA also considered reducing the payment standard for the HCV program, but decided against it because an analysis it conducted comparing these two options—revising the payment standard to 90 percent of FMRs or increasing the tenant contribution rate to 35 percent of gross income—

showed that the tenant contribution rate change would have a lesser impact on lower income households (households with less than $32,000 of income). See appendix 5 of the SCCHA FY2014 MTW Plan for more details (HACSC, 2013).

26 See exhibit 2.1 for definitions of subsidy outcomes included in the present study. See exhibit 2.2 for definitions of other relevant housing subsidy terms.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 12

Chapter 2. Research Design

Exhibit 2.1 Definitions of Housing Subsidy Measures Used in Present Study

Housing Assistance Payment (HAP): The amount that the public housing agency (PHA) provides in subsidy to pay for rent and utilities.

It is calculated as the lower of (1) the payment standard for the family’s unit minus the TTP, or (2) the gross rent minus the TTP. Under the SCCHA new rent calculation rules, the HAP is calculated as the lower of (1) the payment standard for the family’s unit minus the TTP, or (2) the contract rent minus the TTP.

Total Tenant Payment (TTP): The minimum amount that the household must contribute towards rent and utilities. Under traditional rent rules, it is calculated as the greatest of: (1) 30 percent of monthly adjusted income, (2) 10 percent of monthly gross income, and (3) the PHA minimum rent. Under the SCCHA new rent rules, it is calculated as the greater of 35 percent (or 32 percent, after July 2014) of monthly gross income and (2) the PHA minimum rent.

Tenant Rent Share: The household’s total contribution towards the contract rent. For households living in units with contract rents at or below the payment standard, the tenant rent share is equal to the household’s TTP. For households with contract rents that exceed the payment standard, the tenant rent share is calculated as the TTP plus the amount by which the contract rent exceeds the payment standard.

Any Subsidy Receipt: A household is classified as receiving housing subsidies if their HAP amount is greater than zero (in any PHA).

If a household’s income increases to the threshold where their HAP amount is zero because their calculated TTP is greater than the gross rent, they have a grace period of 180 days during which they are not receiving any subsidies but are still considered active in the program. If their income drops before their grace period ends, they can have their TTP recalculated and will begin receiving subsidies again. A household whose HAP is $0 and is in their grace period is not classified as receiving any housing subsidies at that time.

Tenant Rent Share as a Percent of Household Gross Income: Rent burden is typically defined as the portion of a household’s income used toward total housing costs, including rent and utilities. Because data on utility costs were not available for two PHAs in the sample, the present study uses an alternative measure of rent burden, which is calculated as the monthly tenant rent share (rent only, not including utilities) divided by the household’s monthly gross income.

Exhibit 2.2 Definitions of Other Housing Subsidy Terms

Adjusted Income: A household’s gross income minus deductions for the following: dependents, status as a senior family or family with members with disabilities, unreimbursed childcare expenses, unreimbursed medical expenses (for seniors and families with members with disabilities only), and unreimbursed disability assistance expenses.

Fair Market Rent (FMR): The gross rent for units by number of bedrooms on which the household’s housing subsidy is based. HUD sets FMRs annually at the 40th percentile of gross rents in the area, based on local housing market prices for nonluxury, privately owned rental units that meet minimum standards of safety.

Gross Income: A household’s total income before taxes and other deductions, received by all members of the household. It includes total income from wages, social security payments, retirement benefits, military and veteran’s disability payments, unemployment benefits, welfare benefits, and asset income. It excludes certain forms of income, such as earnings from minors and income from live-in aides.

Gross Rent: The total contract rent paid to the landlord plus any utility allowances.

Payment Standard: The maximum subsidy a PHA pays on behalf of a household (before deducting the household’s TTP), which is set by the PHA between 90 and 110 percent of the area’s FMR.

Port-Out: A household relocating to a unit within another PHA jurisdiction.

Utility Allowance: The utility allowance is an estimate of the amount needed for a household to cover its reasonable utility costs, based on bedroom size, which utilities the tenant is responsible for outside the contract rent, the type of utilities (for example, gas versus oil heat), and other unit characteristics such as structure type.

Voucher Size: The number of bedrooms on a household’s voucher. A household’s rent calculation uses the lower of (1) the payment standard for the household’s voucher size, or (2) the payment standard for the household’s unit size.

Minimum Rent: The minimum amount set by the PHA that households must contribute towards rent and utilities.

households’ subsidy levels through its

in the tenant contribution rate might have

change in the tenant contribution rate and

driven some households’ HAP down to zero,

indirectly affected households’ subsidy levels

meaning that such households would be ful y

through households’ employment responses

responsible for their own housing costs. If the

to the changes in their housing costs.

rent reform did in fact increase employment

and earnings, some households might have

The study also seeks to address whether

“earned their way off” housing subsidies (if

the SCCHA rent reform caused households

their increased income effectively reduced

to leave the HCV program. The increase

their subsidy payments to $0). Even for

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 13

Chapter 2. Research Design

households whose HAP was significantly

households for rent, an important research

reduced, but not reduced ful y to $0, some

question is whether the rent reform led to

might have chosen to leave the HCV program

housing-related hardship. For example,

because they found the smal er subsidy

households may have been unable to pay

no longer justified the burden of staying in

their rent on time, leading to arrears and, in

the program and complying with housing

some cases, to eviction and termination from

authority reporting requirements and other

the HCV program. Whether the SCCHA rent

program rules. While there were strong

reform caused increased material hardship

reasons to expect direct effects on average

is an important question, but one that this

household housing subsidy amounts (as

study was not able to answer directly or

discussed before), effects on receiving any

comprehensively. Due to data limitations,

housing subsidy (“attrition” from the program)

the study was able to examine a measure

would have been less direct.

of households’ rent burden over time on a

descriptive level, but it could not measure

Households’ Housing Decisions While in

other aspects of material hardship, such

the Voucher Program

as rent arrears, evictions, food insecurity,

Although the immediate goal of both 2013

inability to pay utility bills or medical

changes in SCCHA policies was to reduce

expenses, and other important expenses. The

HAP expenditures in response to federal

study relied on conversations with SCCHA

budget cuts, the changes could also have

leadership and internal agency documents

had effects on decisions households made

to explore the types of assistance SCCHA

about whether and where to relocate and

provided to alleviate housing-related hardship

whether to change who was on the lease. In

and prevent eviction due to the rent reform.

contrast with the housing subsidy outcomes,

which are near-term outcomes of the SCCHA

Effects for Households Affected by the

rent reform, households’ housing decisions

Tenant Contribution Rate Change Only

are more removed and the effects on these

Versus Households Also Affected by the

outcomes are less direct.

Voucher Size Rule Change

The hypotheses described earlier relate

The tenant contribution rate change could

to the potential effects of the tenant

have encouraged households to seek

contribution rate change. As noted earlier,

other housing if their gross rent was above

23 percent of HCV households (not including

the payment standard, in order to offset

senior households or households headed

the increase in housing costs. The study

by people with disabilities) in SCCHA were

explored whether households moved to

immediately affected not only by the change

smal er units, moved to different types of

in subsidy levels but also by the new voucher

neighborhoods, or relocated to units outside

size policy that SCCHA adopted as part

the jurisdiction of SCCHA (defined as “porting

of its rent reform. The new voucher size

out”), and whether they changed their

policy enforced a minimum of two family

housing composition by adding or removing

members per bedroom, excluding the head

family members.

of household’s bedroom, regardless of age,

generation, gender, or relationship of the

Household Rent Burden While in the

household members.

Voucher Program

Because the policy change effectively

Both groups of households—that subject to

reduced the subsidy amounts provided to

only to the tenant contribution rate change

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 14

Chapter 2. Research Design

and that also subject to the voucher size

many households to find a smal er unit that

rule change—faced the same increased

was affordable; in some cases, moving to

contribution rate of 35 percent of gross

a smal er unit would have been even more

income.27 Thus, its effect on earnings and

expensive than remaining where they were.

employment should be approximately

To the extent that was the case, these

the same for the two groups. Members of

households would have been vulnerable to

the group subject to both policy changes,

especially high rent burdens.

however, faced a much larger total reduction

in housing subsidies, especially if they

Study Sample

could not readily move to a unit with fewer

bedrooms. This larger reduction in net

The analysis sample includes all nonelderly,

income may have produced a stronger

nondisabled households and individuals who

incentive for adult household members

were receiving HCV subsidies from SCCHA

to increase their earnings in order to

or one of the three selected comparison

compensate for their lost net income. On

PHAs at the time of the SCCHA policy

the other hand, if these larger rent burdens

change in July 2013.28, 29 These comparison

led to evictions or other forced moves, the

PHAs include: the Housing Authority of the

resulting instability of their housing situations

County of Alameda, the Housing Authority of

may have led to difficulties in maintaining the

the County of San Mateo, and San Francisco

same job or maintaining the same level of

Housing Authority. The process used for

work effort (especial y if it was necessary to

selecting these PHAs for the comparison

relocate further away from the current job).

group is described later in this chapter.

All households whose rent exceeded the

Quarterly and annual effects on employment

payment standard faced some incentive

were estimated for the cohort of all

to move to a less expensive unit. The

nonelderly, nondisabled individuals who

households that were affected by both

were living in households receiving HCV

policy changes, however, faced an especially

subsidies at the time of the rent reform (July

large reduction in their housing subsidies

2013). Annual effects on household subsidy

because of both the increase in the tenant

amounts and continued housing subsidy

contribution rate and a reduction in the

receipt were estimated for the cohort of

number of bedrooms on which their subsidies

al nonelderly, nondisabled households

would be based. The latter increase could

receiving HCV subsidies from study PHAs at

be avoided by moving to a smal er unit,

the time of the rent reform.

so these households had an especial y

strong incentive to relocate. Their options

The SCCHA policy changes affected al

to relocate may have been limited, however,

HCV households regardless of elderly or

because of rapidly increasing housing

disability status. The present study focuses

prices in the area. According to SCCHA

on nonelderly, nondisabled tenants because

staff members working with households at

its primary research question is how the

the time, these rapid changes to the local

rent reform affected subsidy recipients’

housing market made it very difficult for

employment and earnings, and elderly

27 As mentioned earlier, when SCCHA eliminated all income deductions and allowances from households’ rent calculation policy change, it also eliminated utility allowances. Throughout this paper, references to the tenant rate contribution change include this elimination of utility allowances.

28 The study uses HUD’s definitions of elderly and disabled households and adults. See Box 2.3 for definitions of these terms.

29 The SCCHA policy changes affected all HCV households, regardless of elderly or disability status. The study focuses on nonelderly, nondisabled households because elderly and disabled households would not have had the same flexibility to change their work behavior in response to the policy changes. Although the study’s analysis plan included conducting a parallel, secondary analysis for elderly and disabled households, studying the effects of the rent reform on these households was not feasible due to data limitations (see Castel s, Riccio, Verma, and Long, 2017).

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 15

Chapter 2. Research Design

Exhibit 2.3 HUD Definitions of Sample Terms

Adult: An individual who is 18 years of age or older or a minor under the age of 18 who has been emancipated to act on his/her own behalf, including the ability to execute a contract or lease.

Individual with Disabilities: An individual who has a physical or mental impairment that substantially limits one or more of the major life activities.

Household with Disabilities: A household whose head, co-head, spouse, or sole member is a person with a disability.

Senior Individual: A person at least 62 years of age.

Senior Household: A household whose head, co-head, spouse, or sole member is at least 62 years of age.

and disabled tenants would not have had

household composition. A household was

the same flexibility to change their work

included in the subgroup of households

behavior in response to the policy changes.

affected by the voucher size rule change,

Although the present study had intended to

if its new rent calculation would use the

conduct a parallel, secondary analysis for

payment standard of a smal er voucher size

elderly and disabled households, it was not

under the new policy. All other households

feasible to examine effects of SCCHA’s rent

were included in the subgroup of households

reform on these households due to data

that were only affected by the tenant

limitations. Specifical y, employment trends

contribution rate increase.

for elderly adults declined over time as adults

in these households aged. In contrast, this

At the time of the SCCHA rent reform,

trend for disabled, nonelderly households

only one PHA in the study sample other

increased over time, possibly because some

than SCCHA—the San Francisco Housing

members overcame temporary disabilities.

Authority (SFHA)—had not yet moved to

Unfortunately, SCCHA and the comparison

a more conservative voucher size policy.

PHAs had different proportions of elderly

Therefore, only SFHA could be included

households and disabled households, which

in the comparison group for this subgroup

meant that the employment and earnings

analysis. The method described earlier was

trends for the group of elderly and disabled

used to identify the subgroup of households

households in the comparison PHAs were not

(based on baseline voucher size, unit size,

an appropriate counterfactual for this analysis.

and household composition) in SFHA that

would have been affected by the new

The present study conducted a subgroup

voucher size rules if those rules had been

analysis that compares intervention effects

applied to them. Twenty-three percent

on households that experienced only a

of nonelderly, nondisabled households

change in the tenant contribution rate with

in SCCHA and 21 percent in SFHA were

households that were also affected by the

identified for this subgroup analysis.

voucher-size rule change. The subgroup of

SCCHA households that were affected by

The comparative interrupted time series

the voucher size rule change was identified

(CITS) models for the main analysis were

by comparing households’ voucher sizes

used to estimate effects for nonelderly,

at baseline (in early July 2013, before the

nondisabled individuals. For the subgroup

rent reform was implemented) with their

analysis, they were used to estimate effects

voucher sizes under the new policy. Using

on adults living in nonelderly, nondisabled

actual subsidy data, a simulation applied the

households who were affected by the voucher

new voucher size rules to each household

size policy change in addition to the increase

according to its baseline unit size and

in the tenant contribution rate. This difference

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 16

Chapter 2. Research Design

Chapter 2. R

in sample definition is due to the subgroups

Study Period

being defined using household-level variables

(voucher size, unit size, and household

The CITS design used in this study (described

composition at the time of the policy change)

in detail later) requires a sufficient number

and receiving unemployment insurance (UI)

of time points (ideal y, at least 4 years)

data aggregated within those groupings.

before the policy change to reliably estimate

baseline trends. As exhibit 2.4 shows, the

Although the unit of analysis is the same

SCCHA rent reform was implemented in

for both the full sample and subgroup

early July 2013 (when the PHA sent letters

analyses (individuals, aggregated to PHA-

to subsidy households notifying them of

level averages), the sample of individuals

the rent reform and their new tenant rent

differs somewhat. For the main analysis, the

share under the new rent policy), and the

sample consists of nonelderly, nondisabled

baseline period is defined as the 4 years

individuals living in either nonelderly,

before the start of the SCCHA rent reform

nondisabled households or in elderly or

implementation: July 1, 2009, to June 30,

disabled households (which were also

2013. The fol owup period includes the

subject to SCCHA’s rent reform). For the

4 years after the start of the SCCHA rent

subgroup analysis, the individual-level

reform and is defined as July 1, 2013, to June

analysis sample consists of all adults living

30, 2017. In other words, the analysis used

in those households, regardless of their

4 years of historical (pre-rent-reform) and 4

personal elderly or disabled status. The

years of fol owup (post-rent reform) data on

sample stil consists of mostly nonelderly,

the study cohort to estimate effects of the

nondisabled adults: 94.8 percent of the

rent reform.

adults in the sample are neither elderly nor

disabled. This distinction means, however,

Data Sources

that 19 percent of the SCCHA adults in the

main analysis sample are not included in the

The study primarily relies on two data

subgroup sample because they were living

sources for understanding the rent reform’s

in elderly or disabled households, which are

effects on employment, earnings, housing

excluded from the subgroup analysis.

subsidy receipt and amounts, plus housing

characteristics: state UI wage data and the

Exhibit 2.4 Timeline of Policy Changes

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 17

Chapter 2. Research Design

HUD Inventory Management System/Public

For the subgroup analysis, which looks

and Indian Housing Information Center

at effects on employment and earnings

(IMS/PIC) data. It also uses other data

for adults living in households that

sources—including U.S. Census Bureau

were only affected by the increased

data and internal SCCHA documents and

tenant contribution rate separately from

discussions with SCCHA staff members—to

households also affected by the new

provide context for these findings.

voucher size policy, the sample was defined

at the household level (as described in

Employment and Earnings

more detail in the Sample section above).

Employment and earnings data were

The data were grouped by PHA, household

obtained from the California Employment

elderly or disabled status, and whether

Development Department (EDD). These

the payment standard on which the

administrative data consist of employer-

household’s rent calculation was based

reported UI wage data for al employment

was reduced because of the new voucher

covered by UI in the state of California.

size determination rules. Therefore, this

These data do not, however, include

analysis estimated effects on earnings

wage data for jobs outside of California,

and employment for al adults (regardless

federal employment, or informal or self-

of elderly or disabled status) living in

employment not covered by UI.

nonelderly, nondisabled households

that were subject to the voucher size

The data are quarterly and were received

policy change. Employment and earnings

in aggregate form (for example, average

measures were constructed in the same

earnings in the third quarter of 2013 for

way as for the main analysis.

all households in a group). Since this is a

retrospective study relying on secondary

Housing Subsidies and Housing

analysis of administrative data, it was

Characteristics

not feasible to obtain informed consent

The study relies on IMS/PIC data obtained

for all the members of the sample, and

from HUD for housing-related measures.

therefore the analysis relies on deidentified,

At each household certification, the

aggregate-level earnings and employment

PHA must complete (or update) a HUD

data. The employment and earnings data

Form 50058, which includes information

for the main analysis (which estimates

on a household’s housing subsidy

effects for al nonelderly, nondisabled adults

amount, tenant rent amount, household

receiving HCV subsidies) were grouped by

characteristics, and unit characteristics.

PHA and whether individuals were elderly or

A certification occurs when a household

disabled. These data were used to construct

is issued a new voucher, completes a

the two key measures in this analysis: the

regular recertification, completes an

average quarterly employment rate and

interim recertification due to a change

average quarterly earnings measures. Since

in income or household composition,

CITS analysis requires the calculation of a

relocates to another unit outside of its

trend in the outcome over time, average

regular recertification schedule, relocates

quarterly earnings were adjusted for inflation

to a different housing agency, or ends its

to 2017 dol ars using the Bureau of Labor

program participation.31

Statistics Consumer Price Index (CPI).30

30 Al Urban Consumers (Current Series) database (https://www.bls.gov/cpi/data.htm).

31 A full list of 50058 certification types can be found in the HUD 50058 instruction booklet, available at https://www.hud.gov/sites/documents/50058I.pdf.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 18

Chapter 2. Research Design

Quarterly IMS/PIC snapshot data were used

of records in Year 4 are accurate. This issue

to identify the study sample, to describe

is especially evident in the housing subsidy

household and individual characteristics

amounts in Year 4, which contain many more

at the time of the policy change, and to

extreme values than the prior 3 years that

create covariates for the impact models. To

would likely be corrected in an updated

identify the study sample, snapshot files

file. Therefore, results using the fourth year

from the second and third quarters of 2013

of IMS/PIC data are not presented in this

were used to identify which households in

report, but the overall results using Year 4

the selected PHAs were receiving subsidies

data are reported in footnotes.

on July 1, 2013, just before the SCCHA

rent reform was implemented. These

MTW agencies have fewer 50058 reporting

files provide a snapshot of households’

requirements and use a shortened 50058

information at the end of each quarter.

form to col ect data at each certification.

It was necessary, therefore, to construct

IMS/PIC transactional data were used to

some measures that are available for

investigate effects on housing subsidy

traditional PHAs but are not included in

amounts and housing subsidy receipt

HUD Form 50058 MTW: HAP, TTP, and

and to provide descriptive information on

family share. These measures rely on the

other housing-related outcomes, including

payment standard at the time of the rent

rent burden and unit characteristics. The

calculation (based on the smal er of the

transactional files include a record for

number of bedrooms of the voucher or

each certification that occurred during the

unit), which is not included in the IMS/PIC

study period. Monthly measures from July

data.32 MDRC collected payment standard

2009 through June 2017 were created

amounts for the full study period from

using these data. Data were acquired for al

SCCHA and from the Housing Authority

transactions recorded from January 1, 2009

of the County of San Mateo (HACSM),

(six months before the study period) to

one of the MTW agencies selected for

establish baseline levels of all the housing-

the comparison group.33 MDRC calculated

related measures.

these measures as fol ows:

The IMS/PIC data for the last year of the

• TTP is the minimum amount that the

fol owup period (July 1, 2016, to June 30,

household must contribute toward rent and

2017) have important limitations. The data

utilities. Under traditional rent rules, it is

for this last year of the study period did

calculated as the greatest of (1) 30 percent

not benefit from updates recorded in the

of monthly adjusted income, (2) 10 percent

fol owing year, or from certifications that

of monthly gross income, or (3) the PHA

were recorded in the fol owing year but

minimum rent. Under the SCCHA new rent

effective during Year 4. An analysis of years

rules, it is calculated as the greater of 35

in the study period that had at least one ful

percent (or 32 percent, after July 2014)

year of subsequent data available (2009 to

of monthly gross income or (2) the PHA

2015) found that 12 to 25 percent (depending

minimum rent.

on the year) of certifications effective in

• HAP is the amount that the PHA provides in

a given year had an effective date that

subsidy for rent and utilities. It is calculated

occurred after that year. In other words, it

as the lower of (1) the payment standard

can be expected that only 75 to 88 percent

for the family’s unit minus the TTP or (2)

32 The payment standard amounts and the household HAP, TTP, and family share amounts are included in the IMS/PIC data for traditional PHAs.

33 The selection process for the comparison group is described in detail later in this chapter.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 19

Chapter 2. Research Design

the gross rent minus the TTP. For SCCHA

rent reform, but because utility al owances

households after the new rent policy went

were eliminated as part of the rent reform

into effect, it is calculated as the lower of

(and thus the calculation relies on contract

(1) the payment standard for the family’s

rent instead of gross rent), these data are

unit minus the TTP or (2) the contract rent

not needed to calculate HAP for SCCHA

minus the TTP.

households after the rent reform went

• The family share is the household’s total

into effect. To test whether excluding

contribution toward the gross rent. For

utility allowances from HAP calculations

households with a gross rent at or below

for HACSM households influenced the

the payment standard, the family share

impact estimates for average housing

is equal to the household’s TTP. For

subsidies and continued housing subsidy

households with a gross rent that exceeds

receipt, utility allowance amounts were

the payment standard, the family share is

imputed, and the impact analyses were

calculated as the TTP plus the amount by

rerun using these imputed measures. The

which the gross rent exceeds the payment

sensitivity tests suggest that the influence

standard. (This measure was constructed

of excluding utility al owances for HACSM

for baseline only.)

is negligible. This finding is unsurprising

because San Mateo households comprise

Utility allowance data were not available for

only about one-quarter of the comparison

SCCHA households for all recertifications

group sample and utility costs are not

after the rent reform was implemented in

high for HACSM households (households

2013 because the rent reform eliminated

that are responsible for paying for utilities

utility allowances, and for HACSM after

outside of their contract rent have an

its tiered subsidy policy was implemented

average utility al owance of $97 per month

in 2010 because utility allowances were

during the time period that utility allowance

incorporated into their tiered subsidy

data is available for HACSM). Imputed utility

schedules. Utility allowances are the

al owances for HACSM were also used

PHAs’ estimates of the amount needed

for sensitivity tests of the HAP descriptive

for a household to cover its reasonable

analyses, with similar findings. Specific

utility costs, based on bedroom size,

findings of the sensitivity tests are included

which utilities the tenant is responsible

in footnotes in chapter 3 along with the

for outside the contract rent (for example,

main findings.

heat, cooking, electricity), the type of

utilities (for example, gas, oil, electric), and

To impute the utility allowance amounts in

other unit characteristics such as structure

SCCHA for the sensitivity test described

type (for example, apartment, single-

above, a household’s utility allowance

family home). Utility allowances are added

amount for all fol owup months was set

to contract rent to calculate gross rent,

to equal the amount of the household’s

which is used to calculate family share as

utility allowance in the month before the

described earlier.

implementation of the SCCHA rent reform

(the last month where utility allowance data

Utility allowances are not included in the

was available for SCCHA households). For

calculation of HAP for HACSM in any of

HACSM, where utility allowance data was

the analyses. (As described earlier, HAP

only available during the first year of the

relies on gross rent with the traditional

study period, households’ utility allowance

rent policy.) Data on utility al owances are

amounts in all the fol owing months of

also not available for SCCHA after the

the study period were set equal to the

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 20

Chapter 2. Research Design

household’s utility allowance amount from

exceeds the payment standard) divided by

that first year.34

the household’s gross income.35

A household’s family share is typical y

A 40-percent rent burden is commonly

interpreted as a measure of the family’s

used as the threshold for a high burden in

total out-of-pocket housing costs, including

the literature discussing HCV households

tenant rent share and tenant-paid utilities.

(Ellen and Torrats-Espinosa, 2017; Dawkins

Although the SCCHA rent reform eliminated

and Jeon, 2017). The measure used in this

utility al owances from its rent calculation,

study—the tenant rent share as proportion

households are stil responsible for the

of household gross income—departs from

tenant-paid utilities for their units. To ensure

this standard definition in two ways. First,

that a consistent measure of housing costs

the threshold used is typical y 40 percent

was used across PHAs and across time

of adjusted income—which was impossible

(before and after the SCCHA rent reform),

to measure in SCCHA after it eliminated

the descriptive analysis uses a tenant rent

deductions—which would be a lower

share measure to analyze the amount that

threshold than 40 percent of gross income.

households pay toward rent, not accounting

Second, the measure typical y uses total

for utilities.

housing costs—including tenant rent share

and tenant-paid utilities—as a proportion

An alternative measure of rent burden was

of household income. As described earlier,

constructed for both MTW and traditional

the measure used in the present study only

PHAs. Rent burden is typical y defined as a

uses tenant rent share (and does not include

household’s total housing cost—including

tenant-paid utilities).

rent share and tenant-paid utilities—as a

proportion of household income. Because

Local Context, Neighborhood Poverty

data on utility allowances for the entire

and Hardship Policies

study period are not available for SCCHA

and HACSM, it was not possible to

The present study uses the census tract

reconstruct family share for SCCHA during

poverty rate as a proxy for neighborhood

the fol owup period (or for San Mateo at

quality. Poverty rate is the most widely

al ). To ensure that this descriptive analysis

used measure of neighborhood quality

described later in this chapter examines

and distress (Galvez, 2010). To measure

a consistent measure of rent burden over

neighborhood poverty, the geocoded HUD

time—both before and after the SCCHA

IMS/PIC data were merged with U.S. Census

rent reform—and that this measure is

data. The census tract poverty rates (for

comparable between SCCHA and the

individuals age 18 to 64 years) from either

comparison group PHAs—an alternative

the 2007–2011 American Community Survey

measure of rent burden is used. This

5-year estimates or the 2012–2016 5-year

measure is the tenant rent share (equal to

estimates, depending on the date that the

the TTP plus any amount that the contract

record was entered, were merged with the

rent, not including tenant-paid utilities,

census tracts in the IMS/PIC data.

34 This imputation method was used based on an examination of the percent of households with utility allowances and the average utility allowance amounts over the 4 years of baseline. Both measures remained very stable over these 4 years (in SCCHA, 98.1 to 98.6 percent of households had any utility al owances with an average amount of $104 to $107 each year.) For HACSM, utility al owance data were only available in the first year of the study period. To the extent to which households’ unit size, household income, and other factors affect their decisions about choosing units based on their gross rents in relation to the payment standard, or based on the number and types of utilities the tenant is responsible for, these factors would be captured in their prior utility al owance levels, and this variation in utility al owance amounts is preserved using this imputation method. This imputation method cannot, however, account for changing utility costs when households relocate to different units with different utility costs.

35 For households whose tenant rent share (TTP plus the amount that the contract rent exceeds the unit’s payment standard) exceeds their gross income, this measure is set to 100 percent.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 21

Chapter 2. Research Design

The study used two additional public data

housing subsidy receipt (“attrition”) during

sources during the process of selecting the

the fol owup period. Multiple time points

comparison group PHAs (described later).

(ideally a minimum of 4 years) of baseline

Public data from the California EDD website

data are needed to estimate a baseline

was one source for measures of labor and

trend in CITS analysis, but these housing

housing market information for 2012–2016 for

subsidy measures rely on HUD IMS/PIC

the Bay Area counties where the PHAs in the

data that are available for households only

present analysis were located.36 The other

while they are receiving subsidies. The study

source was 2013 data from the HUD Picture

sample was defined at the point in time

of Subsidized Households dataset, available

when the rent reform was first implemented,

publicly on the HUD website, to describe

and since not all the study households had

the characteristics of households living in

been receiving subsidies for all 4 years

candidate PHAs.

before that point, it was not possible to

estimate a baseline trend for the full sample.

Last, the study relied on discussions with

Therefore, to study the effects of the SCCHA

SCCHA leaders and internal SCCHA

rent reform on housing subsidy amounts and

documentation to better understand PHA

continued receipt, the study instead uses

hardship policies, eviction assistance

an autoregressive difference-in-difference

program, and the overall policy and

method for housing subsidy outcomes.

economic context at the time the rent reform

Although difference-in-difference is a widely

was implemented.

used quasi-experimental approach, it is

less rigorous than CITS because it does not

Analytic Approach

account for potential y differing baseline

trends in outcomes for the treatment and

The present study uses a combination of

comparison groups.

analytic methods to assess the effects of

the SCCHA 2013 rent reform. The most

In addition, descriptive analyses, which

rigorous method used is a CITS analysis,

cannot indicate causality, were used to

which is a quasi-experimental design

explore changes in household decisions

that was used to estimate effects on

about unit size, neighborhood quality,

the study’s key outcomes, employment

changes in household composition, and

and earnings. SCCHA’s rent reform is

housing-related hardships. It was not

particularly well suited for this method

feasible to use CITS or difference-in-

because the rent reform was rolled out all

difference for these analyses because data

at once, the policy change affected all HCV

on these outcomes were available only

households in SCCHA, and an appropriate

for households who were still receiving

comparison group of PHAs exists. These

subsidies, and not all households continued

PHAs were subject to the same labor and

to receive subsidies for the full 4 years after

housing market forces as SCCHA but did

the implementation of the rent reform. The

not implement a rent reform during the

results of the descriptive analyses should be

analysis period.

interpreted with caution and are presented

only to provide context for the rent-reform

It was not feasible to use the CITS method

impact estimates. Each method is described

to estimate the effects of the rent reform

more ful y in the fol owing.

on housing subsidy amounts and continued

36 Data were compiled from the “REPORT 400 C, Monthly Labor Force Data for Counties, Annual Average (Data Not Seasonal y Adjusted)” reports, produced by the Labor Market Information Division of California EDD, available on the California EDD website: https://www.labormarketinfo.edd.ca.gov/

data/unemployment-and-labor-force.html.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 22

Chapter 2. Research Design

Comparative Interrupted Time Series

be the same). The study used a systematic

The CITS analysis measures the impact of

comparison group selection process,

the SCCHA rent reform on earnings or on

described in the fol owing, that identified

employment as the difference between the

comparison PHAs that faced similar local

post rent reform SCCHA deviation from its

economic forces during the study period.

pre-rent reform trend and the corresponding

The first step in the CITS analysis was

comparison group deviation from its pre-rent

to measure the average earnings or

reform trend.37 This method was previously

employment trajectory of all the nonelderly,

used to assess the effects of the Jobs

nondisabled adults in households receiving

Plus program (Bloom, Riccio, and Verma,

subsidies in the SCCHA HCV program over

2005). The focus of the present analysis is

the 4 years before its policy changes in

whether the SCCHA rent reform caused a

2013. This baseline trend was then used

deviation in predicted employment rates or

to extrapolate what earnings levels or

average quarterly earnings for the cohort

employment rates would have looked like

of al nonelderly, nondisabled adults in

in the absence of the policy changes in

SCCHA’s HCV program that differed from any

2013. The second step was to measure the

deviation from predicted employment rates

earnings levels or employment rates after

and average annual earnings that residents

these changes occurred to estimate the

in comparison group PHAs experienced at

magnitude and direction of any subsequent

the time. Model specifications for these CITS

deviations from this baseline trend. A paral el

models are presented in appendix A.

analysis was conducted for comparison

The SCCHA rent reform meets important

PHAs. The final step of the design was to

criteria for a successful CITS analysis.

measure the magnitude and direction of the

First, the policy change or changes must

treatment and control group difference in

be consequential, capable of producing a

these estimated deviations from trend. These

substantial impact in a relatively short time.

observed differences represent the estimates

The reform was consequential in that it was

of the impact of the SCCHA rent reform on

expected to increase the average tenant

individual earnings and rates of employment.

rent share from 27 to 35 percent of gross

income and decrease HAP payments by 12

Autoregressive Difference-in-Difference

percent. Second, the policy change must be

As noted earlier, the present study uses

implemented all at once for the entire study

an autoregressive difference-in-difference

cohort. The rent reform affected all HCV

model to estimate effects on the average

households, and, according to the SCCHA,

amount of subsidy households received and

all households were notified and therefore

the percentage of households in the sample

potential y affected at the same time. Letters

still receiving subsidies each year after the

were sent out to households in the first week

SCCHA rent reform was first implemented.

of July and the changes went into effect on

Difference-in-difference estimation is also

September 1, 2013. Third, for the comparison

a rigorous, quasi-experimental design, but

with other housing authorities to be valid,

unlike a CITS analysis, it does not account for

those housing authorities’ voucher holders

differences in baseline trends.

must be subject to similar labor and housing

market forces as SCCHA (the baseline levels

While the lack of four full years of historical

of employment and earnings do not have to

data for the full study cohort (as discussed

37 See Somers et al. (2013) for a review of this method.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 23

Chapter 2. Research Design

previously) ruled out using a CITS analysis

faced, including rent burden, number of

for these outcomes, the comparison group

bedrooms, neighborhood quality, and

selection process provides a reasonable level

household size. Average levels of these

of confidence that the comparison PHAs had

outcomes for the sample households in

similar baseline trends in housing subsidy

Santa Clara are compared with averages

receipt and amounts and were subject to

in the comparison group PHAs at the last

the same labor and housing market forces.

month of baseline and annually thereafter.

It is important to remember the caveat that

Discussions with SCCHA leadership

if there were any differences in the trends

provided information on safeguards that

of these housing outcomes before the

SCCHA offered to households severely

rent reform, those differences, rather than

affected by the rent reform.

the policy changes, could be the cause of

estimated impacts, or they could mask a true

The trends in the descriptive exhibits

effect when none is detected.

should be interpreted with caution. Data

on these housing measures were available

Conceptual y, autoregressive difference-in-

for only those households still receiving

difference measures the difference between

subsidies. The households that leave the

the outcome of interest at the time of the

subsidy program each year are likely to

policy change and the outcome at specific

differ systematically from households

points during the fol owup period (for

that remain. Therefore, the patterns in

example, 1 year after the policy change) for

housing outcomes over the followup

both the treatment and comparison groups,

period represent only a partial picture of

and then compares those differences. Unlike

outcomes for the households in the study

a simple difference-in-difference model,

sample, and this picture gets even less

however, the models used for this analysis

representative later in the study period,

are autoregressive in that they also control

as the percentage of households still

for preintervention values of the outcome

receiving subsidies gets smaller.

measure. The model estimating effects

on average HAP includes four covariates

The outcome levels for the comparison group

representing HAP amounts in the 4 years

PHAs are also presented in the descriptive

before the rent reform (for those households

exhibits to provide context for the patterns in

not yet receiving HCV subsidies in each of

outcomes for SCCHA in relation to patterns

the 4 years, these values of HAP are $0),

for the comparison group PHAs, which also

along with four binary covariates indicating

have a small percentage of households

whether the household was receiving any

losing their housing subsidies each year.

HCV subsidy in each year before the rent

The comparison group’s outcomes, however,

reform. The model specifications for these

should not be interpreted as a counterfactual

autoregressive difference-in-difference

representing the expected outcomes for

models are provided in appendix A.

SCCHA households in the absence of the

rent reform.

Descriptive Analysis

Drawing conclusions from the patterns

The study looks descriptively at outcomes

of these outcomes can be especial y

that may reflect housing decisions that

problematic if the rent reform had an effect

SCCHA households made in response to the

on the proportion of households that lost

rent reform and that reflect any subsequent

their subsidies. While the analysis did not

housing-related hardship they may have

suggest an overall effect on households

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 24

Chapter 2. Research Design

leaving housing assistance, the SCCHA rent

(hereafter referred to as the “single policy

reform may have influenced which types

change” subgroup) differed from that for

of households left the subsidy program

the 23 percent of nonelderly, nondisabled

during the fol owup even if this change is

households who were affected by both the

not captured by the data on changes in

increased tenant contribution rate and the

the percentage of households receiving

reduction in voucher size (hereafter referred

subsidies over time.

as the “double policy change” subgroup).

The descriptive analysis serves two main

As described in the “Study Sample” section

purposes. First, it examines the averages

above, only one PHA—SFHA—could be

in the housing subsidy outcomes as an

used for the subgroup analysis comparison

additional check on the validity of the study.

group. To verify that SFHA by itself would

The SCCHA rent reform is expected to

provide a valid comparison group for the

have direct effects on households’ housing

subgroup analysis, impact analyses on

subsidies. If there is no clear pattern of

the four key study outcomes—average

an increase in TTP and reduction in HAP

earnings, employment rates, the average

(especial y 1 year after the rent reform was

household HAP, and whether households

implemented), the findings might cal into

were still receiving subsidies—were rerun

question the face validity of the study—

for the ful nonelderly, nondisabled sample

whether the SCCHA rent reform was

with only SFHA as the comparison group.

implemented as expected and whether key

Results of this analysis indicated no policy-

outcomes are being measured correctly.

change effects on employment rates or

Second, the analysis examines patterns in

average earnings for the full sample, which

averages of housing outcomes during the

is comparable to results produced using all

fol owup period that may reflect households’

three comparison PHAs. This provides some

potential responses to the SCCHA rent

confidence that the reduced comparison

reform to see whether any stark deviations

group sample is valid for the subgroup

from pre-rent reform levels are evident,

analysis for earnings and employment

especial y if this deviation does not exist in

impacts, which relies on a comparative

the comparison group. Even if such a stark

interrupted time-series research design.

difference is evident, however, it alone

would not provide compel ing evidence

For the two housing subsidy outcomes,

that the change was caused by the SCCHA

however, using only SFHA as the comparison

rent reform. Instead, it would suggest that

group (and an autoregressive difference-

the rent reform may have led to changes in

in-difference research design) produced

SCCHA households’ housing decisions and

impact estimates that differed appreciably

may warrant further exploration in future

from those based on the full comparison

studies with more rigorous methods directed

group of three PHAs. Specifical y: (1) when

to this question.

using the SFHA comparison group, estimated

impacts on the percent of households still

Subgroup Analysis

receiving housing subsidies receipt rates

were negative and statistical y significant

The subgroup analysis examines whether

compared to essential y zero effects when

the effects of the SCCHA rent reform for

using the full comparison group), and (2)

the 77 percent of nonelderly, nondisabled

estimated SCCHA reductions in in HAP

households who were only affected by

amounts were larger when SFHA replaced

the tenant contribution rate increase

the full comparison group.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 25

Chapter 2. Research Design

These differences in the estimated impacts

Recognizing that the simple difference-

for the housing subsidy outcomes (and the

in-difference estimates for each of the

lack of meaningful differences in impact

subgroups likely contain a bias (due to a

estimates on employment and earnings)

potential y differing underlying baseline

suggest that there is a difference in the

trend for SFHA compared with SCCHA), the

underlying baseline trends between SCCHA

present difference-in-difference-in-difference

and SFHA that is accounted for by the CITS

method is based on the assumption that

analysis (used for the employment and

this bias is reasonably similar across both

earnings outcomes) but not accounted for by

the single policy change subgroup and

the autoregressive difference-in-difference

the double policy change subgroup and

analysis used to estimate effects on housing

therefore can be “subtracted out” from the

subsidies. Because, with SFHA as the only

estimates of their differential impacts. This

comparison group PHA, the autoregressive

assumption seems reasonable here because

difference-in-difference design would not

it is unlikely that any underlying reason for

produce reliable estimates of the effects

the differing baseline trends would affect the

on average housing subsidy amounts and

double policy change group differently than

the percentage of households still receiving

the single policy change group. For example,

subsidies during the fol owup period for the

if the difference in the underlying baseline

single policy change and the double policy

trends in average housing subsidy amounts

change subgroups separately, this study

between SCCHA and SFHA is due to the

focuses on the CITS estimates of effects on

differing baseline trends in employment rates

employment rates and average earnings.

(which are observed in exhibit 2.9, described

later in the report), it is unlikely that the

Although the results of the validation

underlying cause of that difference—perhaps

analysis raise doubt about the validity of

a somewhat slower-growing local economy—

the impact estimates for housing subsidies

would affect the double policy change group

and continued subsidy receipt for the

substantial y differently than the single policy

single policy change subgroup alone and

change group. Thus, one can have some

the double policy change subgroup alone,

confidence in the method used to estimate

it is still possible to gain some insight into

the difference between rent reform impacts

whether the rent reform affected households’

on the two subgroups.

housing subsidies differently for these two

subgroups. In other words, while the study

can’t produce reliable estimates of the effects

Comparison Group Selection

of the SCCHA rent reform on households

One of the main conditions for a CITS design

in the double policy change group, it is

to be an effective method for measuring the

possible to estimate how its effects differ (in

impact of the SCCHA rent reform is that the

direction and magnitude) from those for the

CITS comparison group be subject to labor

single policy change group. These differential

and housing market forces that are similar to

effects can be estimated by examining the

those for SCCHA. Because the present study

difference in the separate estimated effects

identified comparison PHAs in the Bay Area

for the two subgroups. This method is known

in counties with similar labor and housing

as a difference-in-difference-in-difference

markets, one can be reasonably confident

design and is conducted as an exploratory

that this condition is met. This condition is

analysis for the present study.38

important for a CITS analysis because the

38 See Wing, Simon and Bel o-Gomez (2018) for a description of this method.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 26

Chapter 2. Research Design

mean outcome of the comparison group does

With the preceding considerations in mind, a

not serve as the counterfactual outcome for

three-stage process was used to identify PHAs

the treatment group, as it does in most quasi-

to serve as the comparison group. As exhibit

experimental methods. Instead, the deviation

2.5 il ustrates, the first stage narrowed down

in the mean outcome of the comparison

the counties considered by examining local

group from its estimated baseline trend

labor market and housing market conditions.

serves as the counterfactual for the deviation

The second stage examined characteristics of

of the mean treatment group outcome from

households in the remaining candidate PHAs

its estimated baseline trend. Consequently,

to determine which differed appreciably from

the difference between these two deviations

those in SCCHA. Last, baseline earnings and

from trend identifies the impact of the

employment trends for the remaining pool of

SCCHA rent reform on the employment and

PHAs were examined to select those whose

earnings of SCCHA subsidy recipients.

baseline trends were most closely aligned with

the SCCHA baseline trends.

In addition, it is desirable for the CITS

comparison group to have baseline trends for

Exhibit 2.5 Comparison Group Selection

the primary outcome measures (employment

and earnings) that are similar to those for

Stage 1

SCCHA and for the characteristics of their

households to be similar to those of SCCHA

Compare Local Labor and

Housing Market Conditions

residents. While these similarities are not

Candidate Counties: 11

necessary for a CITS analysis to produce

Selected Counties: 5

valid impact estimates (because the CITS

design implicitly controls for these baseline

differences), the closer the alignment

Stage 2

between the treatment and comparison

groups on baseline levels and trends of

Compare PHAs’ Aggregate

Household Characteristics

earnings and employment, and the more

Candidate PHAs: 12

similar the households in the two groups, the

Selected PHAs: 11

more one can be confident that the groups

would respond similarly to changing local

economic conditions. In the original Jobs Plus

Stage 3

evaluation (which also used a CITS design),

Compare PHAs’ Average Baseline

the close alignment in baseline trends of the

Earning and Employment Trends

primary outcome measure (earnings) of the

Candidate PHAs: 11

program and comparison groups lent a great

Selected PHAs: 3

deal of credibility to the results.

Housing Authority of the County of Alameda

Housing Authority of the County of San Mateo,

In contrast, similarity of baseline trends

and San Francisco Housing Authority

is quite important for the difference-in-

difference method that was used to estimate

PHA = public housing agency.

effects on housing subsidy levels and

Notes: Stage 1 conditions were calculated using county-level U.S.

Census Bureau (2010), 2009–2013 American Community Survey 5-Year

whether households continued to receive

Estimates, and California Employment Development Department Monthly

subsidies, since this method does not

Labor Force Data for Counties (2012–2016) data. Stage 2 characteristics

were calculated using HUD housing agency-level Picture of Subsidized

account for any treatment and comparison

Households (2013) data and HUD household-level Public and Indian

group differences in baseline trends.

Housing Information Center data. Stage 3 trends were calculated

using California Employment Development Department individual level

aggregate unemployment insurance (UI) data. Trends were calculated

across the 4-year period from July 1, 2009, through June 30, 2013.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 27

Chapter 2. Research Design

In the first stage, local labor and housing

the more likely it is that households in that

market conditions were examined for the

county would face similar economic forces

12 counties in the San Jose-San Francisco-

as SCCHA households, all other factors

Oakland combined statistical area,39

being equal.

including Santa Clara, in 2013 (when the

SCCHA rent reform was implemented).

Based on these factors, five counties were

San Benito County was excluded early

dropped from consideration: Napa, Sonoma,

on at this stage because there is no PHA

San Joaquin, Solano, and Marin. Napa,

located in this county, which is served by

Sonoma, and San Joaquin were dropped

the Housing Authority of the County of

because they are more rural than Santa Clara

Santa Cruz. The map in exhibit 2.6 shows

(as is evident by their population and housing

the counties’ locations in the Bay Area. In

density measures), and their local labor

addition, the selection process considered

markets are heavily based on agriculture.

geographical factors, such as ease of

Hence, they are probably subject to forces

access to San Francisco and San Jose and

that differ substantial y from those for Santa

the counties’ general proximity to Santa

Clara. Labor market indicators also suggest

Clara. For example, if the large cities of

dissimilarities: They all had lower household

San Francisco and San Jose are not easily

incomes, and San Joaquin and Solano had

accessible by public transportation, there is

higher unemployment rates than Santa

a higher likelihood that households in those

Clara during this period. Furthermore, there

PHAs would be subject to different labor

are indicators that housing markets differ

market forces from households in SCCHA.

significantly from Santa Clara’s: rental vacancy

Also, the closer a county is to Santa Clara,

rates are higher in these counties and average

Exhibit 2.6 Map of Santa Clara and Comparison Counties

KEY

Santa Clara County

Candidate Comparison

Group Counties

Non-Study Counties

Source: California State Association of Counties

39 See appendix exhibit B.1.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 28

Chapter 2. Research Design

rents are lower. MDRC sought input from

Authority and HACSM), MTW reports were

the HUD regional office in San Francisco to

reviewed to assess whether those PHAs

validate its initial assessment. The remaining

had implemented any rent reforms or other

counties were Alameda, Contra Costa, San

policy changes with their MTW flexibility

Francisco, San Mateo, and Santa Cruz.

during the study period that may have

affected the study’s outcomes of interest.

In the second stage of the comparison

One policy change that was explored was a

selection process, all PHAs in the five

tiered subsidy rent structure in San Mateo,

remaining counties and Santa Clara were

which was implemented early in the study

identified and the aggregate household

period. It is unlikely that this policy created

characteristics for the HCV populations

a work incentive or disincentive. There is

of these PHAs were examined. At this

currently no evidence that tiered rent or

stage, a conservative approach was used

subsidy structures affect subsidy recipients’

because it was not clear which household

work behavior; further, the income tiers

characteristics would lead households to

used in San Mateo’s tiered subsidy policy

respond differently to changes in the labor

were small ($2,500 increments). It is

and housing markets, and only one of the

important to note that this change was

12 PHAs in the five candidate counties was

implemented very early on in the study

dropped from consideration. (A stronger

baseline period (early 2010), so even if there

indicator of whether the households in

was any effect on employment or earnings,

the PHAs would respond similarly to

it would have been captured in the baseline

labor and housing market forces is their

trends for that PHA.

actual baseline trend in the outcome of

interest, which was the basis for the third

SCCHA also implemented a rent policy

stage of the selection process.) Further,

change in early 2010 that was intended

the mix of demographics in Santa Clara

to encourage households to increase

is unique (about one-third of households

their earnings. SCCHA extended its

are Asian, one-third are Hispanic, and the

recertification period from the traditional

remaining one-third consists of Black and

12 to 24 months for households that were

White households), and while a mix of

not on a fixed income. This policy change

comparison PHAs can provide some level

was approved in 2009, and SCCHA began

of representation of this racial and ethnic

rol ing it out in January 2010. Households

composition, there is no single PHA in the

could stil request an interim recertification

Bay Area that has a similar mix. Nonetheless,

to decrease their rent share if they

one PHA, the Livermore Housing Authority,

experienced a reduction in income between

was dropped at this stage because of a

certifications but increases in income during

nonelderly, nondisabled HCV population

this period did not result in increased TTP

that looked very different from Santa Clara’s

until the next scheduled recertification. If

on key outcomes. The Livermore Housing

this extended recertification period led to an

Authority had a much higher proportion of

increase in households’ earnings, it would

households with at least one household

have been captured in the baseline trend

member working and a much higher average

and would not be confounded with the

household income than the nonelderly,

SCCHA rent reform in 2013.

nondisabled HCV population in SCCHA.

In the third and final stage of selecting

Because the remaining pool of PHAs

comparison PHAs, earnings and employment

included two MTW PHAs (Oakland Housing

trends for the 4 years before the SCCHA

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 29

Chapter 2. Research Design

rent reform were examined for the remaining

The Housing Authority of the County of

11 candidate comparison PHAs using UI

Alameda, HACSM, and SFHA. Exhibits 2.7

wage data. Again, similar baseline trends

and 2.8 compare these trends for Santa

are not necessary for CITS analysis to

Clara and the selected counties. Exhibit

produce reliable estimates, but they increase

2.9 shows the slopes for the pre-rent

confidence that the two groups of households

reform employment and earnings trends

would respond similarly to changing

in each candidate PHA and the number

economic conditions. This is especial y

of individuals in the HCV program. The

true for baseline trends of the primary

slopes represent the average change in

outcome measures. If baseline earnings and

the outcome by quarter. For example, the

employment trends among comparison group

SCCHA slope of 0.895 for the employment

and treatment group PHAs were closely

rate means that over the baseline period,

aligned, despite differences in household

the employment rate for adults in SCCHA

characteristics such as demographics, it

increased by an average of 0.895

would suggest that households in both

percentage points each quarter. The slope

groups respond similarly to local labor

of 47.79 for the SCCHA average earnings

and housing market forces, regardless of

means that over the baseline period,

differences in their characteristics.

average quarterly earnings increased by

$47.79 each quarter. The closer the slope

Based on these patterns of baseline

to the SCCHA slope, the more similar

employment and earnings before the

the PHA baseline trend is to the SCCHA

SCCHA rent reform, the sample was

baseline trend. Appendix exhibits B.2

narrowed down to the three PHAs with

through B.7 show the baseline trends for

trends most similar to Santa Clara’s:

Exhibit 2.7 Baseline Trends in Quarterly Employment Rates of Nonelderly, Nondisabled Adults in the Santa Clara County Housing Authority and Selected Comparison Housing Agencies

60%

50%

40%

30%

20%

Employment Rate 10%

0%

Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q4/10 Q1/1 Q2/1 Q3/1 Q4/1 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13

Quarter

Santa Clara County HA

San Mateo County HA

Alameda County HA

San Francisco HA

HA = housing authority.

Note: Sample consists of adults in the Housing Choice Voucher program who were not seniors or adults with disabilities.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 30

Chapter 2. Research Design

the full set of PHA candidates along with

It is worth noting that two of the three

the SCCHA baseline trend by county (with

selected comparison PHAs—those in

some counties combined into one graph

Alameda and San Mateo—were already

for readability).

using voucher size determination rules

Exhibit 2.8 Baseline Trends in Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Santa Clara County Housing Authority and Selected Comparison Housing Agencies

$3,500

$3,000

$2,500

$2,000

$1,500

$1,000

Average Earnings

$500

$0

Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q4/10 Q1/1 Q2/1 Q3/1 Q4/1 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13

Quarter

Santa Clara County HA

San Mateo County HA

Alameda County HA

San Francisco HA

HA = housing authority.

Notes: Sample consists of adults in the Housing Choice Voucher program who were not seniors or adults with disabilities. Earnings not adjusted for inflation.

Source: California Employment Development Department aggregate unemployment insurance data Exhibit 2.9 Sample Sizes and Slopes of Candidate Comparison Public Housing Agencies Housing Authority

Number of Adults

Employment Rate Slope (p.p.)

Average Earnings Slope ($)

Alameda County

City of Alameda

1,732

0.625

24.24

Alameda County

7,969

0.880

43.39

City of Oakland

10,617

0.534

29.22

City of Berkeley

921

0.607

32.51

San Mateo County

San Mateo County

3,694

0.800

49.30

San Francisco County

San Francisco

6,279

0.699

43.88

Contra Costa County

Contra Costa County

5,989

0.617

30.73

City of Richmond

1,357

0.579

33.34

City of Pittsburg

957

0.556

26.72

Santa Cruz County

Santa Cruz County

3,813

0.686

33.26

59,461

Notes: Sample consists of adults (who were not seniors or adults with disabilities) in the Housing Choice Voucher program. Earnings not adjusted for inflation.

Source: California Employment Development Department aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 31

Chapter 2. Research Design

that were closer to the more conservative

early July 2013, just before the rent reform

rules (al owing fewer bedrooms based on a

was implemented.40 It shows that households

given household composition) that SCCHA

in both groups have on average two adults,

implemented as part of its 2013 rent reform.

with more than one-half having more than one

Like the other policy changes described

adult in the household, and 65 percent in both

earlier that sample PHAs made between

groups have children in the household. About

2009 and 2013, since these voucher size

62 percent of study households in SCCHA

policies were already in place during the

and 60 percent in comparison PHAs have at

baseline period, any effects on employment

least one household member who is working.

and earnings are captured in the baseline

In both groups, 23 percent of households are

trends. Since the comparison PHAs were

receiving TANF.

selected largely based on the similarity of

those trends, this fact should not undermine

The two groups are also quite similar at the

the validity of including these PHAs in the

individual level. The second panel in exhibit

comparison group.

2.10 presents the baseline characteristics of

nonelderly, nondisabled adults in the HCV

Exhibit 2.10 presents baseline characteristics

program in SCCHA and the comparison

for households and individuals in SCCHA

PHAs. The sample is majority female

and the three selected comparison PHAs in

(64 percent in SCCHA and 66 percent in

Exhibit 2.10 Characteristics of the Sample at Baseline (Nonelderly, Nondisabled Households and Adults) Characteristic

SCCHA

Comparison PHAs

Household characteristics

Average Number of Family Members

Adultsa

1.9

1.8

Children

1.4

1.3

Families with More than One Adult (%)

58.3

50.7

Families with Any Children (%)

64.7

64.6

Current/Anticipated Annual Family Income ($)

17,368

18,525

Income Sourcesb (%)

Wages

61.7

60.4

TANF

23.2

22.9

Social Security/SSI/Pension

12.8

16.5

Other Income Sources

29.1

35.5

Average Monthly Family Sharec ($)

523

561

Average Monthly Housing Subsidyd ($)

1,397

1,244

Monthly Gross Rent Exceeds Payment Standard (%)

53.2

56.7

Neighborhood Poverty Ratee (%)

0%–10%

41.5

41.8

11%–20%

40.1

47.2

21%–30%

14.3

8.1

More than 30%

4.1

3.0

Household Sample Size (Total = 15,499)

7,111

8,388

(continued)

40 A more detailed set of baseline characteristics are presented in appendix exhibits C.1-C.3.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 32

Chapter 2. Research Design

Exhibit 2.10 Characteristics of the Sample at Baseline (Nonelderly, Nondisabled Households and Adults) (continued)

Characteristic

SCCHA

Comparison PHAs

Adult Characteristics

Female (%)

63.9

66.3

Average Age (Years)

35.6

35.4

Race (%)

White, non-Hispanic

9.4

16.7

Black, non-Hispanic

14.7

40.6

Asian or Hawaiian or Pacific Islander, non-Hispanic

34.7

21.2

Hispanic

40.4

20.1

Other Race or More than One Race, non-Hispanic

0.8

1.4

Income Sources (%)

Wages

41.1

41.4

TANF

11.5

11.9

Social Security/SSI/Pension

1.8

4.2

Other Income Sources

14.3

21.0

Average Annual Income from Wages for Individuals with Any Wage Income ($)

16,840

19,247

Individual Sample Size (Total = 34,075)

16,133

17,942

SCCHA = Santa Clara County Housing Authority; TANF = Temporary Assistance for Needy Families; SSI = Supplementary Security Income.

aAdults are defined as individuals age 18 and older who were not classified on the HUD-50058 form as a live-in aide.

bIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

cFamily share is the family’s contribution toward the gross rent.

dHousing subsidy is the full subsidy amount paid by the housing agency on the household’s behalf. It includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

ePoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households and adults that were not headed by seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. The set of comparison group public housing agencies (PHAs) includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Housing subsidy characteristics represent monthly averages. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center and 2009–2013 American Community Survey 5-Year Estimates data comparison PHAs) and the average age

group PHAs have a higher White (17 percent

is about 36 years old in SCCHA and 35 in

compared with 9 percent in SCCHA) and

comparison PHAs. Forty-one percent of

Black (41 percent compared with 15 percent

adults in both groups were working during

in SCCHA) population. As mentioned, while

the last month of the baseline period, and 12

there are some differences in racial and

percent in both groups were receiving TANF.

ethnic composition between SCCHA and the

Average annual earnings were higher in the

comparison group, the fact that the trends

comparison PHAs: $19,247 compared with

in employment and earnings throughout the

$16,840 in SCCHA.

4-year baseline period are similar provides

assurance that households in both groups

Although both groups are racial y and

respond similarly to local economic forces

ethnical y diverse, there are differences in

despite these differences.

their racial and ethnic compositions. SCCHA

has a larger Asian population (35 percent

The fact that households in both groups live

compared with 21 percent in the comparison

in tight housing markets is evident by their

group) and a larger Hispanic population

high level of average household subsidies:

(40 percent compared with 20 percent in

$1,397 monthly for SCCHA households

the comparison group). The comparison

and $1,244 for the comparison PHAs. Also,

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 33

Chapter 2. Research Design

53 percent of households in SCCHA and

As explained previously, the validity of the

57 percent in comparison PHAs have a

CITS analysis that investigates the impact

gross rent that is greater than the payment

of the rent reform on employment and

standard. On average, households pay a

earnings is not based on how similar the

total of $523 monthly in SCCHA and $561

comparison group is to the intervention

in comparison PHAs toward their housing

group, but on the level of confidence that

costs (rent plus utilities). Only a very small

the comparison group PHAs are subject

proportion of households (4 percent in

to the same labor and market forces, and

SCCHA and 3 percent in comparison PHAs)

generally respond similarly to such changes.

live in neighborhoods with poverty rates

The baseline trends in employment and

greater than 30 percent. Most households

earnings presented in exhibits 2.7 and 2.8

(82 percent in SCCHA and 89 percent in

provide a reasonable level of confidence

comparison PHAs) live in neighborhoods with

that subsidy recipients in each of the two

relatively low poverty, with poverty rates of

groups respond similarly to changing

no more than 20 percent.

economic conditions. Even so, it is useful

to note that the study households in the

comparison PHAs are quite similar to the

study households in SCCHA.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 34

Chapter 3. Findings

Chapter 3

chapter 2, UI data were used to construct

the employment and earnings measures

Findings

for this analysis. Given that the SCCHA rent

reform meets the conditions needed for a

CITS analysis (described in the “Analytic

This chapter presents the study’s findings

Approach” section in chapter 2), this method

on the effects of the SCCHA rent reform

provides rigorous evidence of the effects

on subsidy recipients’ employment rates,

of the SCCHA rent reform on residents’

average earnings, average housing subsidy

employment rates and average earnings over

amounts, and continued housing subsidy

the fol owup period.

receipt. This chapter also presents findings

from the descriptive analysis of rent burden

As described in chapter 2, the CITS design

and households’ housing decisions fol owing

tests whether the SCCHA rent reform caused

the rent reform. Findings are presented

a deviation from the predicted baseline trend

first for the ful cohort of nonelderly,

in employment rates and average earnings

nondisabled households and individuals in

for the nonelderly, nondisabled adults in

the HCV program at the time of the SCCHA

the SCCHA HCV program. Exhibits 3.1 to

rent reform in 2013, and then presented

3.6 graphical y il ustrate this analysis. To

separately for households that were affected

estimate effects of the SCCHA rent reform

by both the tenant contribution rate increase

on employment, the first step in the CITS

and the voucher size policy change and

analysis was to use the observed quarterly

households that were affected by the tenant

employment rate of the adults in the SCCHA

contribution rate alone. In sum, there was no

sample (the solid line in exhibit 3.1) over the

evidence of effects of the SCCHA rent reform

4-year baseline period before the SCCHA

on overal employment rates or average

rent reform—shown by the solid vertical

earnings for the full cohort, but there was

line—to measure the employment rate trend

some indication that the SCCHA rent reform

over those 4 years, which is shown by the

reduced earnings for the smal er group of

dotted line over the same baseline period.

households who were affected by both

This baseline trend was used to extrapolate

policy changes. The analysis found evidence

what employment rates would have looked

that the SCCHA rent reform did decrease

like for this SCCHA sample in the absence

average housing subsidies (as intended).

of the 2013 rent reform (by extrapolating

There was no indication that the rent reform,

this trend into the future), as shown with

on average, caused households to leave

the dotted line continuing throughout the

housing assistance.

4-year fol owup period. The second step of

the analysis was to measure the quarterly

employment rates after the SCCHA rent

Impacts on Employment and

reform (the solid line) to estimate whether

Earnings

there was a deviation from this baseline

trend, indicated by the distance between

This section presents findings from the CITS

the solid line during the fol owup period

analysis on the effects of the SCCHA rent

and the dotted line during the fol owup

reform on employment and earnings for the

period. Visual y, this gap indicates that

cohort of nondisabled, nonelderly adults

employment rates were slightly higher than

in the HCV program in July 2013, when the

the trend would predict in the first 2 years of

SCCHA rent reform was implemented. As

implementing the new SCCHA rent policies,

described in the “Data Sources” section in

and then somewhat lower.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 35

Chapter 3. Findings

A paral el analysis was then conducted for

employment rates over the fol owup

the comparison group sample, illustrated

period looks similar to the deviation for

in exhibit 3.2. The deviation of the actual

SCCHA in exhibit 3.1. The final step of the

employment rates from the predicted

analysis was to test whether the deviation

Exhibit 3.1 Quarterly Employment Rates for Nonelderly, Nondisabled Adults in the Santa Clara County Housing Authority Intervention (July 1, 2013)

65

60

55

50

45

Employment Rate (%) 40

35

30

-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16

Relative Quarter

SCCHA Trend

SCCHA Predicted Trend

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of adults who were not seniors or adults with disabilities. Impacts were estimated using a comparative interrupted time series model.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit 3.2 Quarterly Employment Rates for Nonelderly, Nondisabled Adults in the Comparison Group Housing Authoritites Intervention (July 1, 2013)

65

60

55

50

45

Employment Rate (%) 40

35

30

-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16

Relative Quarter

Comparison Trend

Comparison Predicted Trend

Notes: Samples consist of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Impacts were estimated using a comparative interrupted time series model.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 36

Chapter 3. Findings

in the employment rates for SCCHA was

examined. Exhibit 3.3 overlays the graphs

statistical y discernible from the deviation

for the SCCHA and comparison groups.

for the comparison group PHAs. In other

Exhibit 3.4 to 3.6 il ustrate the same CITS

words, the differences in the deviations were

analysis for average earnings. The difference

Exhibit 3.3 Quarterly Employment Rates for Nonelderly, Nondisabled Adults in the Santa Clara County and Comparison Group Housing Authorities

Intervention (July 1, 2013)

65

60

55

50

45

Employment Rate (%) 40

35

30

-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16

Relative Quarter

SCCHA Trend

SCCHA Predicted Trend

Comparison Trend

Comparison Predicted Trend

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Impacts were estimated using a comparative interrupted time series model.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit 3.4 Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Santa Clara County Housing Authority Intervention (July 1, 2013)

5000

4500

4000

)

3500

3000

2500

Average Earnings ($

2000

1500

1000

-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16

Relative Quarter

SCCHA Trend

SCCHA Predicted Trend

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of adults who were not seniors or adults with disabilities. Impacts were estimated using a comparative interrupted time series model.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 37

Chapter 3. Findings

Exhibit 3.5 Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Comparison Group Housing Authorities Intervention (July 1, 2013)

5000

4500

4000

3500

3000

2500

Average Earnings ($)

2000

1500

1000

-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16

Relative Quarter

Comparison Trend

Comparison Predicted Trend

Notes: Samples consist of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Impacts were estimated using a comparative interrupted time series model.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit 3.6 Average Quarterly Earnings of Nonelderly, Nondisabled Adults in the Santa Clara County Housing Authority and the Comparison Group Housing Authorities

Intervention (July 1, 2013)

5000

4500

4000

3500

3000

2500

Average Earnings ($)

2000

1500

1000

-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16

Relative Quarter

SCCHA Trend

SCCHA Predicted Trend

Comparison Trend

Comparison Predicted Trend

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Impacts were estimated using a comparative interrupted time series model.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 38

Chapter 3. Findings

between the gaps for the two groups was

for each of the four quarters in Year 1) is

not statistical y significant for either the

50.8 percent. In other words, in Year 1,

employment rate or average earnings

50.8 percent of the SCCHA households

outcome throughout the fol owup period.

had some earnings in a given quarter, on

average, in Year 1. The second column labeled

Exhibit 3.7 presents the estimated effects

“Impact” represents the estimated impact

of the SCCHA rent reform on average

of the SCCHA rent reform. For example, the

employment rates and average annual

50.8-percent employment rate observed for

earnings for adults for each year of

SCCHA is estimated to be 0.5 percentage

the fol owup period.41 Yearly effects on

point lower than what it would have been

employment rates for each year in the

in the absence of the SCCHA rent reform.

fol owup period were calculated by averaging

This impact estimate is an estimate of the

the quarterly employment rate impact

true effect, which is unknown. The third

estimates across the four quarters in each

column labeled “Std. Error” presents the

fol owup year. Yearly effects on average

standard error of the impact estimate, which

earnings were calculated by summing

measures the uncertainty which exists about

quarterly earnings impact estimates across

its corresponding impact estimate. The final

the four quarters in each fol owup year.

column reports the p-value of the impact

Standard errors were computed accordingly.

estimate, which represents the likelihood that

The first column of results in exhibit 3.7

an estimated effect at least as large as the

labeled “SCCHA Mean” represents the

one observed would have occurred by chance

average outcome for the study cohort in

if there was no true effect. In this example,

SCCHA. For example, the average quarterly

the p-value of 0.604 means that if there were

employment rate in Year 1 (which is an

no true effects of the SCCHA rent reform on

average of the quarterly employment rate

the average quarterly employment rate in

Year 1, then there would be a 60.4-percent

Exhibit 3.7 Impacts on Average Quarterly Employment Rate and Annual Earnings of Nonelderly, Nondisabled Adults Outcome

SCCHA Mean

Estimated Effect

Std. Error

P-Value

Employment Rate

Year 1

50.8

-0.5

0.9

0.604

Year 2

54.5

0.0

1.2

0.972

Year 3

56.6

0.1

1.5

0.929

Year 4

57.5

0.1

1.8

0.941

Earnings

Year 1

11,187

46

349

0.897

Year 2

13,549

143

474

0.763

Year 3

16,198

200

597

0.738

Year 4

18,538

509

725

0.484

Sample Size

34,075

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the San Mateo County Housing Authority, the San Francisco Housing Authority, and the Alameda County Housing Authority. Effects were estimated using a comparative interrupted time series model. All estimated earnings effects are reported in 2017 dollars. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as: *** = 1

percent; ** = 5 percent; * = 10 percent.

Source: California Employment Development Department individual-level aggregate unemployment insurance data 41 See appendix exhibits D.1 and D.2 for estimated quarterly impacts on employment rates and average earnings.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 39

Chapter 3. Findings

chance that an estimated effect of at least 0.5

Impacts on Housing Subsidies

percentage point would be observed. P-values

are marked with one or more asterisks if the

The SCCHA rent reform intended to directly

impact estimate is statistically significant, and

decrease the average household HAP by

the number of asterisks corresponds with

increasing the tenant contribution rate

the level of statistical significance. (Exhibit

from 30 percent of adjusted income to 35

3.7 doesn’t contain any asterisks because

percent of gross income and eliminating

none of the impact estimates are statistically

utility allowances for all households, and

significant.) One asterisk signifies that the

by reducing the voucher sizes for a smaller

probability is 10 percent or less; two asterisks

percentage of households (23 percent) by

signify that the probability is 5 percent or

applying a new voucher size policy. This

less; and three asterisks signifies that the

part of the analysis examines whether the

probability is 1 percent or less.

rent reform did in fact decrease average

household HAP, and whether HAP remained

The results show no evidence of effects on

lower over time. If households had reduced

the percentage of nonelderly, nondisabled

their earnings in response to the rent

adults who are employed or on their

reform (there was no evidence they did

average earnings across the 4 years of

so, as discussed in the previous section),

fol owup. The estimated effects on both

the SCCHA HAP savings would have been

outcomes are small and not statistically

smal er than what it had projected. The

significant. For example, in the first year

analysis also tested whether the SCCHA

after the rent reform, the estimated impact

rent reform increased the rate of households

on average earnings was $46, but this

leaving the HCV program. As discussed

difference was not statistically significant.

earlier, the rent reform could have caused

This estimate could be interpreted to mean

attrition from the HCV program if it drove

that the SCCHA average quarterly earnings

some households’ HAPs down to zero,

of $11,187 for this first fol owup year was

reduced subsidies to the extent that some

$46 higher than it would have been in the

households decided the subsidy no longer

absence of the rent reform. The magnitude

justified the burden of complying with

of the effect is very smal , however, and the

program rules, or increased household rent

standard error and p-values are very large,

burden to a level that was not sustainable

suggesting that this small difference is very

for households.

likely due to chance. In other words, there

is no evidence that the SCCHA rent reform

This section describes the results of the

caused a deviation from its predicted

autoregressive difference-in-difference

average earnings trend in the first year

analysis (described in chapter 2) used to

after the rent reform was implemented that

estimate effects of the SCCHA rent reform

was appreciably different from deviation

on average housing subsidy amounts and

from the predicted average earnings

on the percent of households leaving the

trend for the comparison group during the

subsidy program. As described earlier, the

same time period, where no rent reform

results using this method are less rigorous

was implemented. As exhibits 3.1 to 3.6

than those produced using a CITS design,

illustrate, employment rates and average

because while this method accounts for

earnings increased steadily throughout the

pre-rent reform differences in the levels

4 years fol owing the SCCHA rent reform

of the outcome, if the underlying baseline

for both SCCHA and comparison group

trends in housing outcomes are different

subsidy recipients.

for the treatment and comparison groups,

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 40

Chapter 3. Findings

it is possible that a difference detected at

weaker than that used to estimate impacts

fol owup is attributable to those differing

for exhibit 3.7, however, one can place less

trends rather than being a true effect of the

confidence in the estimates for exhibit 3.8.

SCCHA rent reform. It is also possible that

differing baseline trends could mask a true

The average household housing subsidy

effect when none has been detected.

in the month before the implementation

of the rent reform was $16,764 per year,

Exhibit 3.8 presents the estimated

or $1,397 per month (as shown in exhibit

effects of the SCCHA rent reform on the

2.10). As expected, the SCCHA rent reform

average amount of housing subsidy and

reduced the average amount of housing

the percentage of households receiving

subsidy that households received. This

any housing subsidy at fol owup using

effect is probably a direct result of the

difference-in-difference estimation, which

increase in the tenant contribution rate

compares the change in each outcome

from 30 percent of adjusted income to

between the time period prior to the SCCHA

35 percent of gross income and the other

rent reform and the outcome at each

policy changes implemented as part of

year fol owing the rent reform for SCCHA

the rent reform, which resulted in the PHA

households compared with households in

paying less of a subsidy on behalf of each

the comparison PHAs, where no rent reform

household. In the first year, the average

was implemented at the time. The findings

annual household subsidy was estimated to

in this exhibit can be interpreted in the same

be $1,593 less than it would have been in

way as described in the previous section

the absence of the rent reform. This annual

for exhibit 3.7. Because the research design

effect is equivalent to $133 monthly.42 In

used to estimate impacts for exhibit 3.8 is

the second year after the rent reform was

Exhibit 3.8 Impacts on Housing Subsidies (Nonelderly, Nondisabled Households) Outcome

SCCHA Mean

Estimated Effect

Std. Error

P-Value

Total Annual Housing Subsidy ($)

Year 1

14,335

-1,593

65

0.000***

Year 2

13,414

-1,548

99

0.000***

Year 3

13,481

-1,329

123

0.000***

Receipt of Housing Subsidy (%)

Year 1

99.2

0.5

0.2

0.013**

Year 2

92.9

-0.4

0.5

0.368

Year 3

87.5

-0.9

0.6

0.137

Sample (Total = 15,490)

7,109

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of households that were not headed by seniors or adults with disabilities. The set of comparison group public housing agencies (PHAs) includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Sample sizes may vary because of missing values. Effects were estimated using an autoregressive difference-in-differences model, controlling for the past receipt of housing subsidies and other baseline characteristics of sample households. To assess differences between the research groups, chi-square tests were used for categorical variables and two-tailed t-tests were used for continuous variables. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as: *** =

1 percent; ** = 5 percent; * = 10 percent. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data 42 This first-year impact estimate does not account for the households that were granted a 90-day hardship exemption that al owed them to deduct medical and childcare expenses from their gross income for their temporary HAP calculation. A total of 414 households were granted a hardship exemption, but this total includes elderly and disabled households. SCCHA did not retain data on the elderly and disabled status of these households, so the precise number of households in the study’s nonelderly, nondisabled sample is unknown.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 41

Chapter 3. Findings

implemented, when the tenant contribution

the percentage would have been in the

rate was reduced to 32 percent, the

absence of the rent reform.) Two years after

effect was slightly smal er: the average

the implementation of the rent reform there

monthly household subsidy was $1,548

was no difference between the percentage

less annually, or $129 less monthly, than it

of households in the sample receiving

would have been in the absence of the rent

subsidies in SCCHA and the percentage

reform. In the third year, the rent reform

that would have been receiving subsidies

reduced annual HAP by $1,329 and monthly

in the absence of the rent reform. This

HAP by $111.43,44,45

remained true 3 years after rent reform was

implemented.48,49,50

The bottom panel of exhibit 3.8 presents

the estimated effects of the rent reform

The patterns in household housing subsidy

on whether households are stil receiving

outcomes over time—presented in appendix

subsidies at fol owup.46 Overall, there is

exhibit E.1—align with expectations based

no clear evidence that the SCCHA rent

on the nature and timing of the rent reform.

reform had an effect on the percentage

The average household TTP and family

of nonelderly, nondisabled households

share (TTP plus the amount by which a

that lost their subsidies. There was a smal

household’s gross rent exceeds the payment

(0.5 percentage points) but statistical y

standard) increased more steeply than they

significant increase (0.5 percentage

did for comparison group PHAs when the

point) in the percentage of households

tenant contribution rate changed from 30

continuing to receive subsidies in the first

percent of adjusted income to 35 percent

year of fol owup, but this effect is probably

of gross income in the first year of the rent

inconsequential because of its smal

reform. The increase was tempered in the

magnitude and the fact that it disappears

second year when the tenant contribution

after the first year.47 (This 0.5 percentage

rate was reduced to 32 percent of gross

point impact estimate can be interpreted

income. As expected, the household HAP—

to mean that 99.2 percent of the cohort

which is directly related to the TTP in that

of households who were receiving HCV

a household’s HAP decreases by the same

subsidies from SCCHA when the rent

amount that the TTP increases—mirrors

reform was implemented in July 2013 still

these patterns in TTP and family share.

received subsidies during the first year after

Housing market trends are also reflected

the rent reform was implemented, which is

in these patterns of housing subsidy

0.5 of a percentage point more than what

outcomes: housing prices were steeply

43 The effect continues to decrease in the fourth year, though this finding is likely due to the data limitation for Year 4 housing data described in the “Data Sources” section of chapter 2.

44 The sensitivity test described in chapter 2 that estimated these effects including imputed utility allowances for the HACSM produced very similar results. Impact estimates on average housing subsidies were somewhat smaller than these main findings but were still large and had the same level of statistical significance.

45 Results from a sensitivity test that estimated effects on HAP using utility al owance imputations for HACSM in the HAP calculations had very similar results.

46 Any household that is receiving a HAP amount greater than zero (in any PHA) is counted as still receiving a subsidy at that time. If a household’s income increases to the threshold where its HAP amount is zero because its calculated TTP is greater than the gross rent, the household has a grace period of 180 days during which it is still considered active in the program. If the household income drops during this period, TTP can be recalculated and the subsidy can resume; otherwise, the household’s participation is terminated from the HCV program and the household would have to go back on the waiting list to rejoin if its situation changes. Households that leave the HCV program are included in the average with a subsidy amount of $0. If 10

percent of the sample left the HCV program and the PHA replaced them all with new households, the subsidy receipt rate for the group would be 90

percent (not 100 percent).

47 The statistical significance for an impact estimate of such a small magnitude reflects the high precision that exists when the mean of a binary outcome variable is near zero or one.

48 It also remained true 4 years after the rent reform was implemented. While the data limitations with the Year 4 IMS/PIC data would have affected measures of average subsidy amounts more than the measures of any subsidy receipt, the overall data limitations also reduce the reliability of this Year 4 impact estimate.

49 As a sensitivity test, logistic regressions were run to estimate effects on this dichotomous outcome. The results were very similar.

50 Results from a sensitivity test that included utility al owance imputations for HACSM in the HAP calculations were very similar in magnitude to these main findings except for the Year 1 impact estimate, which was smal er (but still positive) and was not statistical y significant.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 42

Chapter 3. Findings

increasing during the fol owup period, so

led to that difference. Nonetheless, such

there is a general upward trend in subsidies

an observed difference does not by itself

independent of any policy change (across

warrant a definitive conclusion that the

both SCCHA and comparison PHAs) as

SCCHA rent reform caused that difference.

payment standards increased in response.

Comparison group levels are presented to

provide context for the SCCHA findings.

Households’ Housing

Households’ Housing Decisions While

Decisions and Rent Burden

in the Voucher Program

The findings discussed so far show that

The patterns in measures related to

SCCHA rent reform did not have an overall

households’ housing decisions throughout

effect on tenants’ employment and earnings,

the fol owup period give no obvious

and that it did lead to deep and lasting

indication that households are, on average,

cuts in housing subsidies as intended. This

relocating to poorer quality neighborhoods,

section explores measures of households’

moving to smal er units, moving to units

housing characteristics over time to gain

outside the jurisdiction of SCCHA, or

further insight into how households may have

changing their household composition.51

responded to the SCCHA rent reform, and to

There was a general upward trend in

describe households’ levels of rent burden in

households’ neighborhood poverty rate

the years fol owing the rent reform. The rent

over the fol owup period, suggesting that

reform could have encouraged households to

households that moved tended to move to

seek other, less expensive housing, possibly

poorer neighborhoods, but this trend also

with fewer bedrooms or in higher poverty

existed for households in the comparison

neighborhoods in some cases, or to transfer

group PHAs. The SCCHA households’

to an area in the jurisdiction of a different

average number of bedrooms dropped

PHA that still used traditional rent rules.

only slightly, from 2.7 to 2.6 bedrooms. (The

These types of housing decisions would

comparison group’s average number of

have tempered the increase in households’

bedrooms remained constant throughout

rent burden resulting from the reduction in

the fol owup period.) There is also no

housing subsidies.

strong indication that a significant portion

As described in the “Analytic Approach”

of households changed their household

section in chapter 2, the findings in this

composition by adding or removing

section should be interpreted with a great

household members in response to the rent

deal of caution. The exhibits in this section

reform. Household size decreased slightly

present average housing outcomes over time,

over the fol owup period, but a similar

and causal inferences should not be drawn

trend is evident for the comparison group

from this descriptive analysis. For example,

households. Last, there is no indication that a

as described in chapter 2, a stark difference

large portion of households chose to relocate

in the average level of a housing outcome

to a unit outside the jurisdiction of SCCHA

(like a neighborhood poverty rate) fol owing

to avoid the higher out-of-pocket housing

the SCCHA rent reform compared with the

costs (defined as “porting out”); SCCHA had

average level before the rent reform—if this

a lower rate of port-outs than the comparison

difference does not exist for the comparison

group PHAs throughout the study period.

group—may suggest that the rent reform

51 See appendix exhibit F.1 for details.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 43

Chapter 3. Findings

Household Rent Burden While in the

of rent burden that is the tenant rent share

Voucher Program

(equal to the TTP plus any amount that the

contract rent, not including tenant-paid

The lack of effects on employment and

utilities) as a proportion of the household’s

earnings discussed earlier in this chapter

gross income. Exhibit 3.9 shows patterns in

means that households were not increasing

this measure of households’ rent burden from

their incomes to cover their greater tenant

the last month of the baseline period (before

rent share due to the rent reform. These

the rent reform was implemented) through

findings suggest that households were

the 4 years of fol owup.52 In the month before

absorbing their increased housing costs into

SCCHA’s rent reform was implemented,

their current budgets, either by reducing

the percentage of nonelderly, nondisabled

spending or incurring debt. Considering

households whose tenant rent share

material hardship is therefore an important

exceeded 40 percent of their gross income

part of understanding the effects of a rent

looked fairly similar to the percentage for the

reform that increases the tenant contribution

comparison group households; 12 percent in

rate toward rent, but material hardship is

SCCHA and 14 percent in comparison PHAs

only partial y measured in this study. This

were paying more than 40 percent of their

section looks at patterns of a measure of

gross income toward rent. In the first year

rent burden over the study period to better

fol owing the implementation of the SCCHA

understand the extent to which households’

rent reform, the percentage of households in

rent burdens increased after the rent reform

SCCHA paying more than 40 percent of their

was implemented.

income toward rent increased steeply from 12

As described in the “Data Sources” section of

percent to 30 percent, compared with a three

chapter 2, the present study uses a measure

percentage points increase for households

Exhibit 3.9 Tenant Rent Share as a Percent of Monthly Gross Income Among Nonelderly, Nondisabled Households Receiving Subsidies

Outcome

SCCHA

Comparison PHAs

Tenant Rent Share Exceeds 40% of Monthly Gross Income (%)

Last Month of Baseline

12.3

14.0

Last Month of Year 1

30.1

17.4

Last Month of Year 2

30.5

14.2

Last Month of Year 3

19.4

11.2

Tenant Rent Share Exceeds 50% of Monthly Gross Income (%)

Last Month of Baseline

8.9

9.6

Last Month of Year 1

21.4

11.9

Last Month of Year 2

21.9

9.3

Last Month of Year 3

13.9

7.7

Sample Size (Total = 15,490)

7,109

8,381

PHA = public housing agency. SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. The set of comparison group PHAs includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Sample sizes may vary because of missing values. Outcomes shown describe only those households receiving any housing subsidies in the specified month. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data 52 Appendix exhibit F.2 presents alternative measures of rent burden, including average, median, and distributions of rent burden in the last month of baseline and of each fol owup year.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 44

Chapter 3. Findings

in comparison group PHAs. These patterns

the payment standard faced some incentive

largely held up during the second year; the

to move to a less expensive unit. It is

differences declined in the third. That decline

possible, however that the rent reform’s

may not necessarily reflect a true decline in

effects on employment and earnings for the

this measure of rent burden, if it was at least

subgroup of households affected only by the

in part due to households with an extreme

tenant contribution rate increase may have

rent burden leaving the subsidy program

differed from the effects for the subgroup of

(voluntarily or through eviction) and therefore

households affected by both policy changes.

not being counted in the averages.53

Households also affected by the voucher

size rule change might have stayed in their

Subgroup Findings

current units and faced much steeper out-of-

pocket housing costs because they had to

As described earlier, SCCHA implemented

ful y cover the difference between the new

a new voucher size policy that enforced

lower payment standard and the previous

a minimum of two family members per

one, or they might have moved to a smal er

bedroom, excluding the head of household’s

unit whose gross rent exceeded the area

bedroom. Before this policy change, the

payment standard by a larger amount than

age, generation, gender, and relationship of

their previous larger unit. For these reasons,

other household members were considered

households in the double policy change

when determining voucher size. The group of

subgroup could have had stronger incentives

households in SCCHA that were immediately

to change their employment behavior in

affected by this change constituted

addition to stronger incentives to move to a

approximately 23 percent of the nonelderly,

new unit. Furthermore, if double policy change

nondisabled voucher population. This section

households who did not move to smal er units

presents the findings of a subgroup analysis

were unable to afford their much higher rent

of the effects on earnings and employment

shares, and this hardship led them to leave

and describes housing characteristics and

the subsidy program (either by voluntarily

rent burden separately for the households

moving to a more affordable housing situation,

only affected by the tenant rent contribution

like moving in with other family members, or

increase (referred to as the “single policy

through eviction), the turmoil of their housing

change” subgroup) and households affected

situation may also have affected households’

by the voucher policy change in addition to

employment and earnings.

the tenant contribution rate increase (referred

to as the “double policy change” subgroup).

The single policy change subgroup differed

from the double policy change subgroup

As described in the “Research Questions”

in some important ways. It is important to

section of chapter 2, all households in both

keep this in mind when interpreting the

subgroups were affected by the tenant

subgroup findings, as differences in effects

contribution rate increase; therefore, al

between the two subgroups may not be

households faced the potential earnings and

entirely due to being differential y affected

employment incentives and disincentives

by just the tenant contribution rate versus

described in that section for the full sample,

both policy changes but may also reflect

and all households whose rent exceeded

how different types of households respond

53 As described in chapter 2, this study focused on nonelderly, nondisabled households and individuals in the HCV program. Although it was not feasible to conduct an impact analysis for the cohort of elderly and disabled households and individuals in the HCV program due to the data limitations described in chapter 2, the measure of tenant rent share as a percent of gross income was available for this cohort. Appendix Table F.3 presents the rent burden measures for the cohort of elderly and disabled households and shows similar patterns as the nonelderly, nondisabled sample, though the increases in the percent of gross income these households pay toward rent are not as steep.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 45

Chapter 3. Findings

to the policy changes. Exhibit 3.10 presents

least one adult working at baseline than

characteristics of households just before

among the single policy change subgroup:

SCCHA implemented its rent reform for

65 percent compared with 61 percent. The

the single policy change and double policy

double policy change subgroup also had a

change subgroups separately. As expected,

higher level of out-of-pocket housing costs

households that were directly affected by the

($574 monthly) than the single policy change

voucher size rule change tended to be larger

subgroup ($508 monthly) and a larger

and have more children than households

average subsidy ($1,711 per month compared

that were only affected by the tenant

with $1,304).54

contribution rate change. In SCCHA, the

average number of household members is

Subgroup Impacts on Employment

3.7 for this subgroup (compared with 3.2 for

and Earnings

the single policy change subgroup), and 77

The estimated effects of the SCCHA rent

percent of households in the double policy

reform on employment rates and average

change group in SCCHA included children,

earnings for the subgroup of individuals

compared with 61 percent in the single

living in households that were affected only

policy change subgroup. A slightly larger

by the tenant contribution rate increase (the

proportion of households in the double

“single policy change” subgroup) were very

policy change subgroup in SCCHA had at

Exhibit 3.10 Characteristics of the Sample at Baseline by Policy Group (Nonelderly, Nondisabled SCCHA Households and Adults) Characteristic

Single Policy Change

Double Policy Change

Household Characteristics

Average Number of Family Members

Adultsa

1.8

2.2

Children

1.4

1.5

Families with More than One Adult (%)

53.6

74.1

Families with Any Children (%)

61.2

76.7

Current/Anticipated Annual Family Income ($)

16,511

20,247

Income Sourcesb (%)

Wages

60.7

65.2

Temporary Assistance for Needy Families (TANF)

22.6

25.4

Social Security/SSI/Pension

11.2

18.0

Other Income Sources

28.1

32.4

Average Monthly Family Sharec ($)

508

574

Average Monthly Housing Subsidyd ($)

1,304

1,711

Monthly Gross Rent Exceeds Payment Standard (%)

53.5

52.0

Neighborhood Poverty Ratee (%)

0%–10%

39.0

50.1

11%–20%

41.1

36.8

21%–30%

15.5

10.4

More than 30%

4.4

2.7

Household Sample Size (Total = 6,725)

5,183

1,542

(continued)

54 See appendix G for more detailed exhibits of baseline characteristics of households in each of these subgroups.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 46

Chapter 3. Findings

Exhibit 3.10 Characteristics of the Sample at Baseline by Policy Group (Nonelderly, Nondisabled SCCHA Households and Adults)

(continued)

Characteristic

Single Policy Change

Double Policy Change

Adult Characteristics

Female (%)

63.8

64.6

Average Age (Years)

36.0

34.5

Race (%)

White, non-Hispanic

9.7

8.5

Black, non-Hispanic

15.3

14.0

Asian or Hawaiian or Pacific Islander, non-Hispanic

33.1

37.6

Hispanic

41.0

39.1

Other Race or More than One Race, non-Hispanic

0.8

0.8

Income Sources (%)

Wages

41.1

41.2

TANF

11.6

11.1

Social Security/SSI/Pension

1.9

1.3

Other Income Sources

14.5

13.7

Average Annual Income from Wages for Individuals with

16,676

17,273

Any Wage Income ($)

Individual Sample Size (Total = 15,131)

10,974

4,157

SCCHA = Santa Clara County Housing Authority. SSI = Supplementary Security Income.

aAdults are defined as individuals age 18 and older who were not classified on the HUD-50058 form as a live-in aide.

bIncome source categories are as defined on the HUD-50058 form. Wages include one's own business, federal wages, public housing agency (PHA) wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

cFamily share is the family's contribution toward the gross rent.

dHousing subsidy is the full subsidy amount paid by the housing agency on the household’s behalf. It includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

ePoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. The set of comparison group PHAs includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Housing subsidy characteristics represent monthly averages. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo's housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center and 2009–2013 American Community Survey 5-year estimates data similar to the impact estimates for the ful

statistical y significant. They were also not

sample: there is no suggestion of positive

statistical y significantly different from those

or negative effects on employment rates or

for the single policy change subgroup.

average earnings for this subgroup. This is

The impact estimates in the “single policy

unsurprising given that these households

change” panel and the “double policy

constitute 77 percent of the full study

change” panel of exhibit 3.11 represent

sample. As exhibit 3.11 shows, households

impact estimates using a CITS analysis

affected by the change in the voucher size

for each subgroup separately and can be

policy in addition to the tenant contribution

interpreted in the same way as the impact

rate increase (the “double policy change”

estimates in exhibit 3.7. Exhibit 3.11 contains

subgroup)—the remaining 23 percent of

an additional column labeled “Difference

the full study sample—showed a pattern of

Between Groups.” This column presents the

negative estimated effects on employment

results of the statistical comparison between

rates, but these estimates were not

the difference in the impact estimates

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 47

Chapter 3. Findings

Exhibit 3.11 Impacts on Average Quarterly Employment Rate and Annual Earnings by Policy Change Subgroup for Nonelderly, Nondisabled Households

Single Policy Change Group

Double Policy Change Group

Outcome

SCCHA

Estimated

Std.

P-Value

SCCHA Estimated

Std.

P-Value

Difference

Mean

Effect

Error

Mean

Effect

Error

Between Groups

Employment Rate

Year 1

49.9

-0.2

1.4

0.881

51.0

-1.3

1.3

0.323

0.573

Year 2

53.1

-0.2

1.9

0.907

54.6

-1.7

1.7

0.322

0.560

Year 3

54.9

-0.6

2.4

0.801

56.4

-3.5

2.2

0.112

0.374

Year 4

55.6

-0.4

2.9

0.886

57.7

-4.2

2.6

0.112

0.334

Earnings

Year 1

11,223

111

496

0.824

11,572

-663

521

0.208

0.284

Year 2

13,206

212

674

0.755

13,761

-960

695

0.172

0.228

Year 3

15,618

223

859

0.796

16,206

-2,220

875

0.014**

0.048††

Year 4

17,606

736

1,046

0.484

18,487

-2,341

1,058

0.031**

0.041††

Sample Size

12,439

4,438

SCCHA = Santa Clara County Housing Authority.

Notes: The comparison group public housing agency in this exhibit is the San Francisco Housing Authority. Effects were estimated using a comparative interrupted time series model. All estimated earnings effects are reported in 2017 dollars. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as: *** = 1 percent; ** = 5 percent;

* = 10 percent. A two-tailed t-test was applied to differences between the outcomes of the policy subgroups. Statistical significance levels for differences across subgroup impacts are indicated as: ††† = 1 percent; †† = 5 percent; † = 10 percent.

Source: California Employment Development Department household-level aggregate unemployment insurance data between the two subgroups. The numbers

statistical y significant from zero. By the third

in the column represent the p-values, and

year, SCCHA residents in this subgroup

the daggers represent the levels of statistical

were earning $2,220 less annual y on

significance of the estimate of the difference

average than they would have been in the

in impacts.

absence of the rent reform, and this effect

was sustained in the fourth year (when the

The estimated impacts on average earnings

estimated decrease was $2,341). These

by subgroup in exhibit 3.11 suggest that

third- and fourth-year effects are statistical y

the SCCHA rent reform also did not affect

significant at the 0.05 level. They are also

average earnings for the households

statistical y significantly different from the

affected only by the tenant contribution rate

impact estimates for the single policy change

increase. The impact estimates are small

subgroup at the 0.05 level.

and not statistical y significant. There is

some evidence, however, that the household

As exhibits 3.1 to 3.6 from the full sample

members also affected by the voucher

analysis illustrated, employment rates

size rule change may have reduced their

and average earnings increased over the

earnings in response to the rent reform.

fol owup period for both SCCHA and the

For this double policy change subgroup,

comparison group. In the context of these

average annual earnings were estimated to

earnings trends, an estimated negative effect

be lower in the first 2 years after the rent

on average earnings means that although

reform was implemented than they would

average earnings did increase over time

have been in the absence of the rent reform,

for SCCHA subsidy residents, they did not

though these estimated effects were not

increase as quickly or as much as they would

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 48

Chapter 3. Findings

have in the absence of the rent reform.

subgroup impact estimate minus the single

An estimated negative effect on average

policy change subgroup impact estimate).

earnings could be caused either by some

The column to the right of that column

SCCHA residents reducing their employment

contains their p-values, which are marked

in response to the rent reform, or by some

with daggers to indicate the level of statistical

SCCHA residents not obtaining employment

significance.

or not increasing their hours or wages

because of the rent reform.

The findings of this analysis do suggest

that the households in the double policy

This negative effect of the rent reform

change subgroup experienced much

on average earnings for the households

larger reductions in HAP than the single

affected by both the tenant contribution

policy change group. Households in

rate change and the voucher size rule

the double policy change subgroup

change seems at least partly due to the

experienced reductions in subsidies that

decrease in employment rates that the

were more than $4,000 larger than the

impact estimates (though not statistically

single policy change group in the first

significant) on employment rates suggest.

2 years fol owing the rent reform, and

The negative effect on employment and

this difference declined somewhat in the

earnings for this subset of the sample did not

third year. These differences in effects on

occur immediately after the rent reform was

average HAP are statistical y significant at

implemented, suggesting that residents did

the 0.01 significance level. The differential

not reduce their employment right away.

effects on continued subsidy receipt are

not statistical y significant between the

An exploratory analysis examined whether

two groups (though approach statistical

these employment and earnings effects may

significance by the third year), but the

also be related to the double policy change

pattern of these differential effects may

households’ housing experiences fol owing

suggest that the SCCHA rent reform led

the rent reform. As described in the “Analytic

a small percentage of households in the

Approach” section of chapter 2, using the

double policy change group to leave the

difference-in-difference approach with a

subsidy program or lose their housing

reduced comparison group (described in

subsidies. The timing of these estimated

the “Sample” section of the same chapter)

impacts on continued subsidy receipt

for the subgroup analysis does not al ow

align with the timing of the estimated

for reliably estimating effects on housing

negative impacts on employment and

subsidy outcomes for the single and double

earnings for this double policy change

policy change subgroups separately, but

subgroup, suggesting that they may be

the exploratory analysis overcomes much

related. The patterns in housing subsidies

of these limitations. The difference-in-

for each of the subgroups (in relation to

difference-in-difference method used for

their corresponding comparison groups)

this analysis is described in the “Analytic

aligns with these suggestive findings. HAP

Approach” section of chapter 2. Because

decreased significantly more, and tenant

these analyses are considered exploratory,

rent share increased significantly more for

the results for this analysis are presented in

the double policy change subgroup than

the appendix exhibit G.7. The column labeled

for the single policy change subgroup.

“Difference Between Subgroup Impacts”

By the third year after the SCCHA rent

can be interpreted as the difference in

reform was implemented, 86 percent of

impact estimates (the double policy change

SCCHA households in the double policy

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 49

Chapter 3. Findings

change subgroup were still receiving

then continuing to drop to 3.1 bedrooms by

subsidies compared with 91 percent in the

the end of the third year, compared with the

comparison group.55

comparison group, whose average remains

steady at 3.1 starting before the SCCHA rent

Households’ Housing Decisions and

reform was implemented and remaining at

Rent Burden While in the Voucher

3.1 throughout the 3 years fol owing the rent

Program by Subgroup

reform. For the single policy change group,

the number of bedrooms remains steady

Households affected by only the tenant

both for SCCHA and comparison group

contribution rate increase may have had

households. There is no apparent pattern

an incentive to move to a more affordable

of households changing their household

unit (whose contract rent exceeds the

composition fol owing the policy changes for

payment standard by a lesser amount than

either subgroup.56

their current unit) to offset increases in

housing costs. In addition to this incentive,

One particularly striking pattern is that the

households affected by the voucher size

double policy change households’ tenant

rule change in addition to the tenant

rent share (as measured by TTP plus the

contribution rate increase also have a very

amount that the contract rent exceeds the

strong incentive to relocate to smal er units

payment standard) increased very steeply

to avoid the steeper out-of-pocket housing

in the year fol owing implementation of the

cost they would have faced if they remained

rent reform for households continuing to

in their units.

receive subsidies compared with the single

policy change subgroup. Tenants’ rent

Especial y in a tight housing market, finding a

shares increased slightly in the comparison

unit that is affordable may require moving to

groups for both the single policy change

a more affordable neighborhood. The trend

households and the double policy change

among both single policy change households

households. The SCCHA households’

and double policy change households looks

tenant rent share in the single policy

similar to each other: a slight increase in

change subgroup increased from $447

neighborhood poverty over the 3 years

to $529 between the month before the

fol owing the SCCHA rent reform that mirrors

SCCHA rent reform and 1 year later (which

the full sample results. Similar to the full

was a larger increase than the single policy

sample findings, the differences between

change comparison group, as expected.)

each subgroup of SCCHA households and

In contrast, the SCCHA households’ tenant

their corresponding comparison group

rent share in the double policy change

households (whose trends fluctuates only

subgroup rose from $511 per month just

slightly) are not stark, and it is impossible

before the implementation of the rent

to draw any conclusion about effects from

reform to $810 per month 1 year later. (Only

these purely descriptive data. The trends in

a tiny fraction of households in the double

number of bedrooms over time suggest more

policy change subgroup—0.3 percent—

strongly that households in the double policy

stopped receiving housing subsidies

change group moved to smal er units, with

between these two time points, so these

households’ average unit size dropping from

averages are a relatively reliable measure

3.4 to 3.2 bedrooms in the first year after the

of the sample’s housing costs.) Tenant rent

SCCHA rent reform was implemented, and

shares did decrease in subsequent years

55 See appendix exhibits G.8 and G.9 for more details.

56 See appendix exhibits G.10 and G.11 for details.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 50

Chapter 3. Findings

(in part because of the reduction in tenant

rent reform was implemented, just 6 percent

share from 35 percent to 32 percent of

of these households had tenant rent shares

gross income), but they remained high.

that exceeded 40 percent of their gross

This might suggest that while many double

income. The percentage jumped to 61

policy change subgroup households moved

percent 1 year after the rent reform was first

to smal er units, many other households

implemented. (In contrast, this percentage

stayed in place and paid the much higher

only increased from 15 percent to 21 percent

housing costs as a result.

for single policy change households.) This

percentage then decreased over the rest

The increase in tenant rent share for double

of the fol owup period, to 50 percent by

policy change households from $511 to $810

the end of the second year and 33 percent

per month is quite large for this subset of

by the end of the third. This decrease

SCCHA households, which have an average

reflects the tenant contribution rate being

household income of $1,687 per month.

reduced from 35 percent to 32 percent

This apparent hardship is explored more

of gross income in the second year of its

formal y in exhibit 3.12, which presents

implementation, but may also reflect the

a measure of households’ rent burden

fact that some households may have moved

(defined in the present study as the tenant

to smal er or more affordable units after

rent share as a percentage of gross income)

the end of the first year, or that households

just before the SCCHA implementation

with the highest levels of rent burden may

of the rent reform and throughout the

have left the subsidy program fol owing the

fol owup period.57 The levels of average

rent reform. It is notable that the downward

tenant rent share as a percentage of gross

trend in the percentage of households

income demonstrate that this subset of

exceeding this 40-percent threshold also

households experienced very high levels

decreased for the comparison group (SFHA)

of housing-related hardship after the rent

in this subsample, possibly also because of

reform was implemented. Just before the

Exhibit 3.12 Tenant Rent Share as a Percent of Monthly Gross Income Among Nonelderly, Nondisabled Households Receiving Subsidies, by Policy Subgroup in Santa Clara County Housing Authority

Outcome

Single Policy Change

Double Policy Change

Tenant Rent Share Exceeds 40% of Monthly Gross Income (%)

Last Month of Baseline

14.9

5.8

Last Month of Year 1

21.4

60.5

Last Month of Year 2

24.5

50.2

Last Month of Year 3

15.6

32.9

Tenant Rent Share Exceeds 50% of Monthly Gross Income (%)

Last Month of Baseline

10.9

4.1

Last Month of Year 1

14.0

47.3

Last Month of Year 2

16.8

38.7

Last Month of Year 3

10.9

25.0

Sample Size (Total = 6,723)

5,181

1,542

SCCHA = Santa Clara County Housing Authority.

Notes: Sample sizes may vary because of missing values. Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data 57 Additional measures of rent burden are presented in appendix exhibits G.12 and G.13.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 51

Chapter 3. Findings

the changing composition of households

rent rose only slightly from 11 to 14 percent,

continuing to receive subsidies over time.

but for households in the double policy

The same pattern is evident using a higher

subgroup, this percentage rose steeply

threshold. The percentage of households in

from 4 percent just before the start of

the single policy change subgroup paying

implementation to 47 percent 1 year later.

over one-half of their gross incomes toward

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 52

Chapter 4. Discussion

Chapter 4

counteracting the intended savings from

the increase in the tenant contribution

Discussion

rate.) Nonelderly, nondisabled households

received approximately $1,600 less in

housing subsidies, on average, during the

This chapter summarizes the study’s

first year, $1,550 less in the second, and

findings and discusses their implications. It

$1,330 less in the third year after the rent

also discusses the study’s limitations and

reform than they would have received

next steps for future research in the area of

without the rent reform. There was also

rent reform.

no evidence that the rent reform caused

households to lose their housing subsidies.

Discussion of Findings

There are two factors specific to the SCCHA

In response to federal budget reductions in

context that might have strengthened any

2013, SCCHA implemented a rent reform that

incentive inherent in the rent reform’s policy

increased the tenant contribution rate for

change to increase their employment and

all households from 30 percent of adjusted

earnings. First, Santa Clara County and

income to 35 percent of unadjusted income

its surrounding counties had a robust job

and changed voucher size rules for these

market during the study period. It is worth

households. A central question of the present

noting that even in this job market with many

study is how the rent reform implemented by

employment opportunities, households did

SCCHA affected households’ employment

not increase their employment or earnings in

and earnings. As discussed earlier in the

response to an increased tenant contribution

“Research Questions” section of chapter

rate. Second, SCCHA has a 24-month

2, there were three such possible effects

recertification period, which is longer than

of the rent reform: (1) The increased tenant

the typical 12-month recertification period

contribution rate would act as a disincentive

used in traditional PHAs. SCCHA households

that would cause households to decrease

that were considering increasing their

their earnings, (2) households would

income in response to the rent reform (to

increase earnings to cover their increased

compensate for lost net income) may have

housing costs, or (3) there would be no

had a stronger incentive to do so than

effect on earnings or employment because

they would have in a PHA with a 12-month

households would adjust spending in other

recertification period. If positive effects

areas to cover their higher housing costs,

had been estimated on employment and

increase their debt, or experience increased

earnings, these two factors would have

material hardship.

needed to be taken into consideration when

interpreting results. With no evidence of

The present study found no evidence that

effects on employment and earnings, it is

these policy changes had any effects, on

unknown whether this potential incentive

average, with respect to the employment

may have been a factor in balancing out a

and earnings of nonelderly, nondisabled

disincentive to earn more.

SCCHA residents. The absence of an overall

reduction in household earnings meant that

The combination of findings that overal

SCCHA was able to realize its projected

the SCCHA rent reform did not increase

HAP savings. (If there were to have been a

residents’ average earnings levels and that

reduction in household earnings, it would

it did, as intended, reduce households’

have led to an increase in HAP amounts,

housing subsidies means that households

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 53

Chapter 4. Discussion

experienced reductions in their net income.

the (subsidized) rent in at least one month

For households that did not increase their

of the past year. Furthermore, 28 percent

income over time, these reductions in

said they were not able to buy food and 23

net income could have been persistent.

percent said they were not able to see a

Households who did increase their income

doctor or buy prescription drugs they needed

over time would have experienced smal er

during at least one month in the past year

increases in net income compared with the

(Riccio, Deitch, and Verma, 2017). Given that

increases they would have experienced

HCV households in SCCHA were likely to

in the absence of the rent reform. This

be experiencing similar material hardship

interpretation is consistent with SCCHA

before the rent reform, there is a risk that the

leadership’s impression that voucher

increase in housing costs and consequent

households generally did not change their

decrease in net income caused by the rent

employment behavior but instead absorbed

reform may have worsened such hardship.

their increased housing costs. This study

did not include measures of households’

A subgroup analysis explored how the

material hardship beyond a measure of rent

SCCHA rent reform may have affected

burden, and therefore cannot assess how

households subject to only the change in

this increase in rent burden translated into

the tenant contribution rate differently from

their experiences with material hardship.

households who were also affected by the

It is an important consideration, however,

voucher size rule change. Like the findings

because increased housing costs for

for the full sample, there was no evidence

households without increased income

that the rent reform had any effects on

to cover those costs could mean that

employment or earnings for the subgroup

households are reducing spending on other

only affected by the tenant contribution rate

necessary goods and services, which may

change. There was, however, some evidence

lead to increased material hardship, or are

that the SCCHA rent reform reduced

increasing their debt.

earnings for the subgroup of households

that was affected by both policy changes.

One study—the Rent Reform demonstration—

These households experienced particularly

that is currently underway in four PHAs can

high levels of rent burden fol owing the

provide some context for potential effects

rent reform (measured as the tenant rent

on households’ material hardship. A baseline

share as a proportion of household gross

survey of the households participating in the

income). The negative effect on earnings

demonstration—a population comparable to

for this subgroup did not occur immediately

the sample for the present study, consisting

after the rent reform was implemented,

of nonelderly, nondisabled households in the

suggesting that residents did not reduce

Housing Choice Voucher (HCV) program—

their employment right away, but perhaps

revealed that even households receiving

struggled with their increased housing

housing subsidies under traditional rent rules

costs before reducing their earnings.

commonly experience material hardship:

An exploratory analysis shows that, as

almost 70 percent of survey respondents

expected, the SCCHA rent reform led to

said they had experienced at least one form

especially deep cuts in housing subsidies

of material hardship during the last year.

for this double policy change subgroup.

Forty-six percent said they were not able

To the extent that the steep increases

to pay a utility bil , 34 percent said they

in households’ housing costs led some

were not able to pay a telephone bil , and

households to leave the subsidy program

20 percent said they were not able to pay

(of which there is only suggestive evidence),

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 54

Chapter 4. Discussion

this housing instability might partially

being operated. An attorney working in

explain the employment and earnings

the program (and now a staff member of

effects for this subgroup of households, if

SCCHA) recal ed that of the 293 households

having to relocate to a new unit or leave the

that SEPP assisted, only two cases at most

subsidy program destabilized a person’s

resulted in an actual eviction. Other PHAs

employment situation. The true drivers

considering a similar policy change in a

of these delayed negative effects on

similar context (where finding an affordable

household earnings for this subgroup cannot

smal er unit may be difficult) might consider

be definitively explained within the scope of

that households who are vulnerable to

the present study.

adverse effects because of the policy

change may greatly benefit from an effective

These findings hint at some potential

safeguard such as the SEPP program that is

consequences of implementing a voucher

offered over an extended period of time.

size policy that causes steep increases in

households’ housing costs if they don’t

Study Limitations

move to a smal er unit. The scarcity of

affordable housing in Santa Clara meant

Findings from this study contribute to the

that households had fewer options for less

emerging body of evidence on how changing

expensive units. Although the trends in the

the rent policy for households receiving

average number of bedrooms over time

housing assistance can affect employment

suggest that some households in this group

and earnings. Stil , the study has some

did move to smal er units, it is likely that many

limitations that should be kept in mind

were unable to, or that if they did, those

when interpreting the results. An important

units may not have been as affordable as

limitation, as discussed earlier, is that aspects

their previous units.58 In a location with more

of material hardship beyond rent burden,

affordable housing options, it is possible that

such as food insecurity and difficulty covering

households that have to move to a smal er

medical expenses or rent and utilities, are

unit may have an easier time doing so.

not measured in this study. A full assessment

of the implications of increasing the tenant

SCCHA provided crucial safeguards for

contribution rate—or any other rent reform

these households by partnering with local

that effectively reduces housing subsidy

organizations to provide legal and financial

levels—should consider the effects on the

assistance to prevent eviction. It is important

level of material hardship that households

for any PHA that implements a rent reform

experience in response to the policy change.

to identify the households that might be

most adversely affected by the policy

Another limitation is that the study does

changes and provide them with adequate

not examine how the effects of the rent

protections from severe hardship. This study

reform may vary for different types of

provides evidence that can help inform that

individuals and households. It includes a

assessment for other PHAs considering these

subgroup analysis that compares effects

changes to the rent policy. For example,

for households only affected by the tenant

the SCCHA eviction prevention assistance

contribution rate and households affected

program (SEPP) provided an important

by both policies, but there may be other

support that likely helped many households

sources of variation that the study was not

avoid eviction during the time that it was

able to explore. It is possible, for example,

58 A new unit with fewer bedrooms under the new policy could be less affordable than the former unit with more bedrooms if the new unit’s gross rent exceeded the payment standard for the smal er voucher size more than the former unit’s gross rent exceeded the payment standard for the larger voucher size.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 55

Chapter 4. Discussion

that nonelderly, nondisabled adults who were

This analysis relies on UI wage data to assess

already working at the time the SCCHA rent

effects on employment and earnings, and

reform was implemented would have more

these data do not capture earnings from

flexibility than those who were not employed

employment that is not covered by UI. While

to increase or reduce their employment and

there is no strong reason to believe that the

earnings in response to the increased tenant

SCCHA rent reform would have affected

contribution rate. Nonelderly, nondisabled

informal employment differently from formal

individuals who are not yet working may have

employment, this study cannot formal y test

less of an incentive to begin a new job with

that assumption. It is possible, however, that

the higher tenant contribution rate. The study

the increased rent contribution rate could

was not able to estimate effects separately

strengthen the incentive to underreport

for these subgroups due to data limitations.

earnings to the PHA, and underreporting

would be easier with informal employment,

The primary analytic method in this study is

especial y if the worker is not paying taxes on

a rigorous one: a CITS to examine the effects

the earnings.

of the SCCHA rent reform on employment

and earnings. As described in chapter 2, the

Final y, the present study focused on only

rent reform meets important conditions for

one PHA in one location, Santa Clara County,

CITS in that it was a consequential change

that has a tighter housing market and a more

that occurred for the full study cohort al

robust job market than most of the country,

at once, and there were data available for

though there are many PHAs in comparable

a comparison group that was subject to

situations—such as PHAs in New York

the same economic forces as SCCHA. As

City, Boston, Los Angeles, Seattle, Denver,

noted in the Analytic Approach section of

Washington, and San Diego—serving large

chapter 2, it was not feasible to use CITS

numbers of households. These findings

to examine effects on households’ average

provide an important contribution to the

housing subsidies or continued subsidy

literature on the effects of rent reform on

receipt because 4 years of historical housing

labor market outcomes; still, the estimated

subsidy data were not available for the ful

effects should not be interpreted as effects

study sample and therefore baseline trends

that one should necessarily expect if this

could not be estimated for these measures.

rent reform were implemented elsewhere.

The autoregressive difference-in-difference

Additional studies in multiple locations with

design used to study effects of the rent reform

diverse contexts are needed to draw more

on these outcomes is not as rigorous as CITS

broadly applicable conclusions.

because it does not account for potential y

differing baseline trends in housing subsidy

Conclusion

measures. Furthermore, it was not feasible to

use either CITS or autoregressive difference-

The present study of the effects of a rent

in-difference to examine effects on housing

reform implemented by SCCHA provides

characteristics (including number of bedrooms

evidence, from one location, that a public

in the unit or neighborhood poverty) or

housing agency can increase the tenant

household composition, because these data

contribution rate by a moderate amount (30

were not available for households that were

percent of adjusted income to 35 percent

no longer receiving subsidies. The descriptive

of gross income, later to 32 percent of

analysis used to explore these outcomes can

gross income) without creating a substantial

only provide suggestive evidence of potential

disincentive to work and without significantly

effects on these outcomes.

increasing the likelihood that households

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 56

Chapter 4. Discussion

may lose their subsidies. It also provides

may be expected to vary based on the

suggestive evidence that implementing

context. Studies with a random assignment

a voucher size policy that requires some

design would help overcome many of the

households to relocate to a different unit

methodological limitations of this study

(with fewer bedrooms) to avoid even deeper

described above, for example, by providing

cuts in housing subsidies may have adverse

a reliable counterfactual for outcomes where

effects on some households in the context of

multiple years of pre-intervention data are

a housing market where affordable housing

not available for the full sample. Final y, future

options are very limited, and that short-term

studies of rent reforms that might result in

safeguards that PHAs provide to households

reduced housing subsidies for households

may not ful y prevent longer term hardship.

should careful y measure households’

experiences with material hardship, including

The results of this study should not be

food insecurity and their ability to cover

interpreted as conclusive evidence of

medical expenses, in response to the rent

expected effects in any context, given that

reform. Nevertheless, the present study

the study focuses on only one location.

begins to address one aspect of housing

Further research is needed in multiple

subsidy policy—how increasing the tenant

locations that represent diverse housing

contribution rate affects households’

markets and labor markets to examine

employment, earnings, and housing

how the effects of this type of rent reform

subsidies—where strong evidence is lacking.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 57

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 58

Appendix A

Appendix A

Appe Model Specifications

ndix A

Comparative Interrupted Time Series

Autoregressive Difference-in-

Model Specifications

Model

Difference Model

Comparative Interrupted Time Series Model

Autoregressive Difference-in-Difference Model

The following comparative interrupted time series (CITS) model

The following autoregressive difference-in-difference (DinD)

was used to estimate effects on quarterly employment rates

model was used to estimate effects on housing subsidy out-

The following comparative interrupted time series (CITS) model was used to esti The mate f

e ol

ff l

e ow

cts ing

on aut

quartor

e eg

rly ressive difference-in-difference (DinD) model was used to estimate effects on and average quarterly earnings:

comes:

employment rates and average quarterly earnings:

housing subsidy outcomes:

(

(

*3

*3

<(

<(

?

Y" = % α' PHA'" + % /0' PHA'"Q" + % /*2 F2" + % /52 F2" ∗ S" + 8"

Y9 = α + /*:9 + % /5; Y;9 + % /=; R;9 + % /( X@9 + 89

')*

')*

2)*

2)*

;) <*

; ) <*

@)*

Where:

Where:

Where:

Where:

Y" = the Y

value of the outcome variable for observation i, where observation i is defined as the value of the i = the value of the outcome variable for observation i, where

Y h = the value of the outcome variable for sample household h,

Y9 = the value of the outcome variable for sample household h, outcome observation

variable for PH i

A is defined as the value of the outcome variable for

p in quarter q,

α = the intercept, representing the conditional mean outcome

PHA p in quarter q,

α = the interfor the three comparison PHAs combined,

cept, representing the conditional mean outcome for the three comparison PHAs PHA = a se PHA = a series of four indicator variables, one for each PHA

ries of four indicator variables, one for each PHA p,

p

c , ombined, S = 1 if household h was in SCCHA (the treatment group) at the α = a serie α = a series of four intercepts for baseline trends, one for each

time of the rent reform and 0 otherwise,

s of four intercepts for baseline trends, one for each PHA p,

PHA p,

S = 1 if household h was in SCCHA (the treatment group) at the time of the rent reform and 0

β = estimate of the effect of the SCCHA rent reform on out-

1

Q = the Q = the quarter (a continuous variable),

quarter (a continuous variable),

otherwise, come Y,

β = a series of coefficients representing the slope of the

Y bh = a set of four variables representing the lagged value of the

β

0

0 = a series of coefficients representing the slope of the baseline trend for each oβ

f 1t =

he es

fo tuirm

a

PHte

As, of

the effect of the SCCHA rent reform on outcome Y,

baseline trend for each of the four PHAs,

outcome variable Y for the four baseline years prior to the rent

reform for household h

F = an indi F = an indicator value for followup quarter

cator value for followup quarter f,

f,

Y;9 = a set of four variables representing the lagged value of the outcome variable Y for the four β = a series of four regression coefficients, one for each of the

β = a series of coefficients representing the comparison group

2

baseline years prior to the rent reform for household h

1

β1 = a series of coefficients representing the comparison group deviation from its baseline tre four variables representing the lagged values of the outcome nd for each

deviation from its baseline trend for each followup quarter f,

for the four baseline years prior to the rent reform,

fol owup quarter f,

β

S = 1 if the PHA is SCCHA (the treatment group) and 0

2 = a series of four regression coefficients, one for each of the four variables representing the R = a set of four variables representing whether the household

otherwise,

lagged values of the outcome for the four baseline years prior to the rent reform, S = 1 if the PHA is SCCHA (the treatment group) and 0 otherwise,

received any subsidies in each of the four baseline years prior

β = a series of coefficients representing the treatment-

to the rent reform,

2

β2 = a seri comparison group difference between their deviations from R = a set of four variables representing whether the household received any subsidies in each of es of coefficients representing the treatment-comparison group difference between their β = a series of four regression coefficients for the four baseline

deviations their baseline trends for each followup quarter

from their baseline trends for each followup quarter f, f

a, and

3

the four baseline years prior to the rent reform,

nd

years’ indicators of any housing subsidy receipt,

e = a random error term.

e = a random error term.

β3 = a series X = a set of back

of four regressi ground characteristics for household

on coefficients for the four baseline yea h

r ,59

s’ i ndicators of any housing

subsidy rec β

eip = the set of regression coefficients for the back

t,

ground char-

4

acteristics,

X = a set of e = a random error term.

background characteristics for household h,59

β4 = the set of regression coefficients for the background characteristics,

e = a random error term.

70

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform

59 The background household characteristics included in the model as covariates include: the head of household’s gender, age, race and ethnicity, and receipt of wage, Temporary Assistance for Needy Families (TANF), or Social Security/Supplementary Security Income/Pension (SSIP) income; number of adults in a household; age of the youngest child; annual household wage earnings; monthly family share; and whether the household’s monthly gross rent exceeds the payment standard.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform

75

59 The background household characteristics included in the

model as covariates include: the head of household’s gender, age, race and ethnicity, and receipt of wage, Temporary Assistance for Needy Families (TANF), or Social Security/Supplementary Security Income/Pension (SSIP) income; number of adults in a household; age of the youngest child; annual household wage earnings; monthly family share; and whether the household’s monthly gross rent exceeds the payment standard.

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 59

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 60

Appendix B

Appendix B

Supplemental Exhibits for Comparison Group Selection

Exhibit B.1 Local Labor and Housing Market Conditions, Bay Area Counties

Characteristic

Alameda County

Contra Costa

Marin County

Napa County

San Francisco

County

County

Total

population (%)

1,510,271

1,049,025

252,409

136,484

805,235

White

33.7

47.2

72.7

55.8

41.7

Black

11.8

8.8

2.6

2.0

5.6

Asian

26.6

14.5

5.6

6.9

33.1

Hispanic

22.5

24.5

15.5

32.6

15.2

Median household

rent ($)

1,289

1,365

1,628

1,350

1,488

Median household

income ($)

72,112

78,756

90,839

70,443

75,604

Persons with

income below the

12.5

10.5

7.7

10.1

13.5

poverty level (%)

Bachelor’s

degree

41.8

39.0

54.6

31.3

52.4

attained (%)

Unemployment in

8.7

8.9

6.3

8.4

6.8

2012 (%)

Unemployment in

7.2

7.5

5.2

6.9

5.5

2013 (%)

Unemployment in

5.8

6.2

4.3

5.7

4.4

2014 (%)

Unemployment in

4.7

5.0

3.5

4.6

3.6

2015 (%)

Unemployment in

4.2

4.4

3.2

4.3

3.3

2016 (%)

Population density

(per sq. mi)

2,043.6

1,465.2

485.1

182.4

17,179.2

Housing unit

density (per sq. mi)

788.3

559.1

213.7

73.2

8,041.8

Rental vacancy

rate (%)

4.3

5.2

3.4

6.4

3.7

(continued)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 61

Appendix B

Exhibit B.1 Local Labor and Housing Market Conditions, Bay Area Counties (continued)

Characteristic

San Joaquin

San Mateo

Santa Clara

Santa Cruz

Solano County

Sonoma County

County

County

County

County

Total

population (%)

685,306

718,451

1,781,642

262,382

413,344

483,878

White

35.4

41.9

34.7

59.2

40.5

65.8

Black

6.8

2.5

2.4

0.9

13.7

1.4

Asian

14.0

25.1

32.3

4.1

14.3

3.9

Hispanic

39.3

25.3

26.8

32.4

24.5

25.2

Median

household rent

1,026

1,602

1,566

1,385

1,264

1,265

($)

Median

household

53,380

88,202

91,702

66,519

67,177

63,356

income ($)

Persons with

income below

the poverty level

18.2

7.6

10.2

14.6

13.0

11.9

(%)

Bachelor’s

degree

18.1

44.4

46.5

37.0

24.3

32.2

attained (%)

Unemployment in

2012 (%)

14.4

6.4

7.9

11.8

10.7

8.9

Unemployment in

2013 (%)

12.3

5.3

6.5

10.3

9.1

7.1

Unemployment in

2014 (%)

10.5

4.2

5.2

8.8

7.5

5.6

Unemployment in

2015 (%)

8.9

3.4

4.2

7.5

6.1

4.5

Unemployment in

2016 (%)

8.1

3.0

3.8

5.3

5.3

3.8

Population

density (per sq.

492.6

1,602.2

1,381.0

589.4

503.0

307.1

mi)

Housing unit

density (per sq.

168.0

604.4

489.8

234.7

185.8

129.8

mi)

Rental vacancy

rate (%)

6.3

3.1

3.1

4.0

6.8

4.8

Note: No PHAs are located in San Benito County, so the county is not shown.

Sources: 2010 U.S. Census Bureau; 2009–2013 American Community Survey 5-year estimates; California Employment Development Department monthly labor force data for counties (2012–2016)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 62

Appendix B

Exhibit B.2 Baseline Trends in Quarterly Employment Rates of Nonelderly, Nondisabled Adults in the Santa Clara and Alameda County Comparison Candidate Housing Agencies

60%

50%

Santa Clara

County HA

40%

City of

Alameda HA

30%

City of

Oakland HA

20%

Employment Rate

Alameda

County HA

10%

City of

0%

Berkeley HA

Q3/09Q4/09Q1/10Q2/10Q3/10Q4/10Q1/1 Q2/1 Q3/1 Q4/1 Q1/12Q2/12Q3/12Q4/12Q1/13Q2/13

Quarter

Note: Samples consists of adults who were not seniors or adults with disabilities in the Housing Choice Voucher program.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit B.3 Baseline Trends in Average Quarterly Earnings for Nonelderly, Nondisabled Adults in the Santa Clara and Alameda County Comparison Candidate Housing Agencies

$2,500

$2,000

Santa Clara

County HA

$1,500

City of

Alameda HA

$1,000

City of

Oakland HA

Average Earnings

Alameda

$500

County HA

City of

$0

Berkeley HA

Q3/09Q4/09Q1/10Q2/10Q3/10Q4/10Q1/1 Q2/1 Q3/1 Q4/1 Q1/12Q2/12Q3/12Q4/12Q1/13Q2/13

Quarter

Notes: Samples consists of adults (who were not seniors or adults with disabilities) in the Housing Choice Voucher program. Earnings not adjusted for inflation.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 63

Appendix B

Exhibit B.4 Baseline Trends in Quarterly Employment Rates of Nonelderly, Nondisabled Adults for Santa Clara and Contra Costa County Comparison Candidate Housing Agencies

60%

50%

Santa Clara

40%

County HA

City of

30%

Richmond HA

City of Pittsburg

20%

HA

Employment Rate

Contra Costa

10%

County HA

0%

Q3/09Q4/09Q1/10Q2/10Q3/10Q4/10Q1/1 Q2/1 Q3/1 Q4/1 Q1/12Q2/12Q3/12Q4/12Q1/13Q2/13

Quarter

Note: Samples consists of adults (who were not seniors or adults with disabilities) in the Housing Choice Voucher program.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit B.5 Baseline Trends in Average Quarterly Earnings of Nonelderly, Nondisabled Adults for Santa Clara and Contra Costa County Comparison Candidate Housing Agencies

$2,500

$2,000

Santa Clara

$1,500

County HA

City of

Richmond HA

$1,000

City of Pittsburg

Average Earnings

HA

Contra Costa

$500

County HA

$0

Q3/09Q4/09Q1/10Q2/10Q3/10Q4/10Q1/1 Q2/1 Q3/1 Q4/1 Q1/12Q2/12Q3/12Q4/12Q1/13Q2/13

Quarter

Notes: Samples consists of adults (who were not seniors or adults with disabilities) in the Housing Choice Voucher program. Earnings not adjusted for inflation.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 64

Appendix B

Exhibit B.6 Baseline Trends in Quarterly Employment Rates, Nonelderly, Nondisabled Adults Santa Clara, and San Mateo County and San Francisco County Comparison Candidate Housing Agencies

60%

50%

Santa Clara

40%

County HA

San Mateo

30%

County HA

20%

San Francisco

Employment Rate

HA

10%

0%

Q3/09Q4/09Q1/10Q2/10Q3/10Q4/10 Q1/1 Q2/1 Q3/1 Q4/1 Q1/12Q2/12Q3/12Q4/12Q1/13Q2/13

Quarter

Note: Samples consists of adults (who were not seniors or adults with disabilities) in the Housing Choice Voucher program.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Exhibit B.7 Baseline Trends in Average Quarterly Earnings, Nonelderly, Nondisabled Adults, Santa Clara, and San Mateo County and San Francisco County Comparison Candidate Housing Agencies

$3,500

$3,000

$2,500

Santa Clara

County HA

$2,000

San Mateo

$1,500

County HA

San Francisco

Average Earnings $1,000

HA

$500

$0

Q3/09Q4/09Q1/10Q2/10Q3/10Q4/10Q1/1 Q2/1 Q3/1 Q4/1 Q1/12Q2/12Q3/12Q4/12Q1/13Q2/13

Quarter

Notes: Samples consists of adults (who were not seniors or adults with disabilities) in the Housing Choice Voucher program. Earnings not adjusted for inflation.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 65

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 66

Appendix C

Appendix C

Supplemental Baseline Characteristics Exhibits

Exhibit C.1 Household Composition and Income at Baseline

Characteristic

SCCHA

Comparison PHAs

Average Number of Family Members

Adultsa

1.9

1.8

Children

1.4

1.3

Families with More than One Adult (%)

58.3

50.7

Number of Children in Family (%)

None

35.3

35.4

1 Child

23.3

27.7

2 Children

20.3

19.7

3 or More

21.1

17.2

For Families with Children, Age of Youngest Child (%)

0–5 Years

36.6

34.9

6–12 Years

39.6

40.4

13–17 Years

23.8

24.6

Current/Anticipated Annual Family Income ($)

17,368

18,525

Current/Anticipated Annual Family Income (%)

$0

3.5

4.1

$1–4,999

16.9

12.3

$5,000–9,999

22.1

20.2

$10,000–19,999

23.4

26.6

$20,000 or More

34.0

36.9

Income sourcesb (%)

Wages

61.7

60.4

TANF

23.2

22.9

Social Security/SSI/Pension

12.8

16.5

Other Income Sources

29.1

35.5

(continued)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 67

Appendix C

Exhibit C.1 Household Composition and Income at Baseline (continued)

Characteristic

SCCHA

Comparison PHAs

Average Annual Income from Wages, for Families

22,278

24,281

with Any Wage Income ($)

Annual Income from Wages, for Families with Any Wage Income (%)

$1–4,999

11.1

6.1

$5,000–9,999

15.0

12.8

$10,000–19,999

26.9

29.1

$20,000–29,999

19.8

20.2

$30,000 or More

27.3

31.8

Sample Size (Total = 15,499)

7,111

8,388

SCCHA = Santa Clara County Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aAdults are defined as individuals age 18 and older who were not classified on the HUD-50058 form as a live-in aide.

bIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

Notes: Samples consists of households that were not headed by seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. The set of comparison group public housing agencies (PHAs) includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 68

Appendix C

Exhibit C.2 Characteristics of Adults at Baseline

Characteristic

SCCHA

Comparison PHAs

Female (%)

63.9

66.3

Age (%)

18–24

32.2

31.3

25–34

18.7

19.8

35–44

18.0

18.7

45 or Older

31.1

30.1

Average Age (Years)

35.6

35.4

Race (%)

White, non-Hispanic

9.4

16.7

Black, non-Hispanic

14.7

40.6

Asian or Hawaiian or Pacific Islander,

non-Hispanic

34.7

21.2

Hispanic

40.4

20.1

Other Race or More than One Race,

non-Hispanic

0.8

1.4

Income Sourcesa (%)

Wages

41.1

41.4

TANF

11.5

11.9

Social Security/SSI/Pension

1.8

4.2

Other Income Sources

14.3

21.0

Average Annual Income from Wages for

Individuals with Any Wage Income ($)

16,840

19,247

Annual Income from Wages for Individuals with Any Wage Income ($)

$1–$4,999

19.8

9.9

$5,000–$9,999

18.7

18.9

$10,000–$19,999

27.9

32.4

$20,000–$29,999

16.7

18.3

$30,000 or More

16.9

20.4

Individual Sample Size (Total = 34,075)

16,133

17,942

SCCHA = Santa Clara County Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages.

Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

Notes: Samples consists of adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values. Rounding may cause slight discrepancies in sums and differences. The set of comparison group public housing agencies (PHAs) includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 69

Appendix C

Exhibit C.3 Characteristics of Households at Baseline

Characteristic

SCCHA

Comparison PHAs

Average Monthly Family Sharea ($)

523

561

Average Monthly Family Share (%)

$0

0.0

0.2

$1–$299

38.8

33.3

$300–$599

26.9

28.7

$600–$899

16.3

17.6

$900 or More

18.0

20.2

Family Share as a Proportion of Monthly Gross Income (%)

0%–20%

1.1

1.1

21%–30%

47.8

42.4

31%–40%

29.2

32.8

41%–50%

7.5

9.1

51% or Above

14.4

14.5

Average Monthly Housing Subsidyb ($)

1,397

1,244

Average Monthly Housing Subsidy (%)

$0–$599

5.8

9.7

$600–$899

10.0

13.6

$900–$1,199

19.1

23.7

$1,200 or More

65.0

53.0

Payment Standard Reduced with New Rulesc (%)

22.9

20.6

Monthly Gross Rent Exceeds Payment Standard (%)

53.2

56.7

Neighborhood Poverty Rated (%)

0%–10%

41.5

41.8

11%–20%

40.1

47.2

21%–30%

14.3

8.1

More than 30%

4.1

3.0

Sample Size (Total = 15,499)

7,111

8,388

SCCHA = Santa Clara County Housing Authority

aFamily share is the family’s contribution toward the gross rent.

bHousing subsidy is the full subsidy amount paid by the housing agency. It includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

cThe Comparison Group value for “Payment Standard Reduced with New Rules (%)” measure is calculated for the San Francisco Housing Authority only.

dPoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consists of households that were not headed by seniors or adults with disabilities. Sample sizes may vary because of missing values. The set of comparison group public housing agencies (PHAs) includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Housing subsidy characteristics represent monthly averages. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures. A sensitivity test that used imputed utility allowance values to calculate housing subsidy measures for San Mateo caused only slight change in levels.

Sources: MDRC calculations using HUD Public and Indian Housing Information Center; 2009–2013 American Community Survey 5-year estimates data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 70

Appendix D

Appendix D

Quarterly Impacts on Employment and Earnings

Exhibit D.1 Impacts on Quarterly Employment Rates (Nonelderly, Nondisabled Adults) Outcome

SCCHA Mean

Estimated Effect

Std. Error

P-Value

Average Year 1

50.8

-0.5

0.9

0.604

Q3 of 2013

49.9

-0.4

0.8

0.631

Q4 of 2013

51.2

-0.5

0.9

0.613

Q1 of 2014

50.2

-0.6

1.0

0.556

Q2 of 2014

51.7

-0.5

1.1

0.662

Average Year 2

54.5

0.0

1.2

0.972

Q3 of 2014

54.3

0.3

1.1

0.814

Q4 of 2014

55.3

0.5

1.2

0.704

Q1 of 2015

53.8

-0.4

1.3

0.740

Q2 of 2015

54.8

-0.1

1.3

0.933

Average Year 3

56.6

0.1

1.5

0.929

Q3 of 2015

56.3

0.2

1.4

0.885

Q4 of 2015

57.2

0.1

1.5

0.954

Q1 of 2016

56.1

0.1

1.6

0.938

Q2 of 2016

56.9

0.1

1.7

0.937

Average Year 4

57.5

0.1

1.8

0.941

Q3 of 2016

57.5

0.0

1.8

0.996

Q4 of 2016

57.8

0.0

1.8

0.992

Q1 of 2017

56.8

0.3

1.9

0.891

Q2 of 2017

57.6

0.3

2.0

0.873

Sample Size

34,075

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consists of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Effects were estimated using a comparative interrupted time series model. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as:

*** = 1 percent; ** = 5 percent; * = 10 percent.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 71

Appendix D

Exhibit D.2 Impacts on Average Quarterly Earnings (Nonelderly, Nondisabled Adults) Outcome

SCCHA Mean

Estimated Effects

Std. Error

P-Value

Year 1

11,187

46

349

0.897

Q3 of 2013

2,618

-6

77

0.936

Q4 of 2013

2,861

37

88

0.678

Q1 of 2014

2,744

-56

91

0.543

Q2 of 2014

2,963

71

98

0.472

Year 2

13,549

143

474

0.763

Q3 of 2014

3,150

51

108

0.638

Q4 of 2014

3,477

44

122

0.721

Q1 of 2015

3,338

27

124

0.830

Q2 of 2015

3,584

22

131

0.869

Year 3

16,198

200

597

0.738

Q3 of 2015

3,799

34

139

0.805

Q4 of 2015

4,259

50

145

0.733

Q1 of 2016

3,906

20

153

0.895

Q2 of 2016

4,234

95

162

0.557

Year 4

18,538

509

725

0.484

Q3 of 2016

4,591

163

169

0.338

Q4 of 2016

4,625

52

178

0.773

Q1 of 2017

4,596

173

187

0.358

Q2 of 2017

4,725

123

195

0.531

Sample Size

34,075

SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Impacts were estimated using a comparative interrupted time series model. All estimated earnings effects are reported in 2017 dollars. The p-value indicates the likelihood that the estimated impact (or larger) would have been generated by an intervention with zero true effect. Statistical significance levels are indicated as: *** = 1 percent; ** = 5 percent; * = 10 percent.

Source: California Employment Development Department individual-level aggregate unemployment insurance data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 72

Appendix E

Appendix E

Supplemental Exhibits for Housing Subsidies

Exhibit E.1 Outcomes Related to Housing Assistance (Nonelderly, Nondisabled Households) Outcome

SCCHA

Comparison PHAs

Received Any Housing Subsidies (%)

Baselinea

100.0

100.0

Year 1

99.2

98.3

Year 2

92.9

92.4

Year 3

87.5

86.9

Total Tenant Payment (TTP), Among Households Receiving Subsidiesb ($)

Last Month of Baseline

420

448

Last Month of Year 1

494

468

Last Month of Year 2

489

529

Last Month of Year 3

541

579

Housing Assistance Payment (HAP), Among Households Receiving Subsidiesc ($)

Last Month of Baseline

1,419

1,262

Last Month of Year 1

1,206

1,257

Last Month of Year 2

1,258

1,282

Last Month of Year 3

1,401

1,361

Total Tenant Rent Share, Among Households Receiving Subsidiesd ($)

Last Month of Baseline

455

471

Last Month of Year 1

590

504

Last Month of Year 2

602

553

Last Month of Year 3

611

594

Sample Size (Total = 15,490)

7,109

8,381

PHAs = public housing agencies. SCCHA = Santa Clara County Housing Authority.

aThe subsidy receipt status reported in HUD’s quarterly snapshot data files differed slightly from the status reported in HUD’s transactional data files. The baseline subsidy receipt status in this exhibit is based on Q2 to Q3 2013 quarterly snapshot data, while the status in the followup years are based on transactional data.

bTTP is the minimum amount a family must contribute toward rent and utilities regardless of the unit selected. For MTW households, TTP has been calculated to reflect the minimum rents in Santa Clara and San Mateo.

cHousing subsidy is the full subsidy amount paid by the housing agency on the household’s behalf and includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

dTotal tenant rent share is the family’s contribution toward the contract rent.

Notes: Samples consist of households that were not headed by seniors or adults with disabilities. The set of comparison group PHAs includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Sample sizes may vary because of missing values. Outcomes shown describe only those households receiving any housing subsidies in the specified month. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 73

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 74

Appendix F

Appendix F

Supplemental Exhibits for Households’ Housing Decisions

Exhibit F.1 Outcomes Related to Households’ Housing Decisions Among Nonelderly, Nondisabled Households Receiving Subsidies

Outcome

SCCHA

Comparison PHAs

Neighborhood Poverty Ratea

Last Quarter of Baseline

11.5

12.0

Last Quarter of Year 1

11.7

12.1

Last Quarter of Year 2

12.0

12.4

Last Quarter of Year 3

12.2

12.6

Number of Bedrooms

Last Month of Baseline

2.7

2.4

Last Month of Year 1

2.7

2.4

Last Month of Year 2

2.6

2.4

Last Month of Year 3

2.6

2.4

Took a Port-Out Action (%)

Baseline

1.4

2.9

Year 1

1.7

4.3

Year 2

2.0

3.2

Year 3

1.8

2.7

Household Size

Last Month of Baseline

3.3

3.1

Last Month of Year 1

3.3

3.0

Last Month of Year 2

3.3

3.0

Last Month of Year 3

3.3

3.0

Sample Size (Total = 15,490)

7,109

8,381

SCCHA = Santa Clara County Housing Authority.

aPoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. The set of comparison group public housing agencies (PHAs) includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Sample sizes may vary because of missing values. Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Sources: MDRC calculations using HUD Public and Indian Housing Information Center data; American Community Survey 5-year estimates, 2007–2011 and 2012–2016

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 75

Appendix F

Exhibit F.2 Tenant Rent Share as a Percent of Monthly Gross Income Among Nonelderly, Nondisabled Households Receiving Subsidies Outcome

SCCHA

Comparison PHAs

Median Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

29.1

29.3

Last Month of Year 1

35.0

29.5

Last Month of Year 2

32.0

29.3

Last Month of Year 3

32.0

29.3

Average Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

33.8

33.4

Last Month of Year 1

45.7

34.7

Last Month of Year 2

44.2

33.2

Last Month of Year 3

39.6

32.3

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Baseline (%) 0–25%

16.5

16.5

26–30%

62.6

57.2

31–35%

6.1

8.7

36–40%

3.1

4.2

41–50%

3.0

4.1

51% and Above

8.7

9.4

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 1 (%) 0–25%

0.5

15.3

26–30%

1.2

55.0

31–35%

60.0

8.9

36–40%

10.0

4.3

41–50%

7.6

5.0

51% and Above

20.7

11.5

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 2 (%) 0–25%

0.7

14.4

26–30%

2.1

62.4

31–35%

58.7

6.1

36–40%

9.7

3.6

41–50%

7.6

4.3

51% and Above

21.3

9.2

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 3 (%) 0–25%

1.0

13.5

26–30%

3.1

68.3

31–35%

71.7

4.8

36–40%

5.9

2.8

41–50%

4.8

3.1

51% and Above

13.5

7.5

Sample Size (Total = 15,490)

7,109

8,381

PHAs = public housing agencies. SCCHA = Santa Clara County Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. The set of comparison group PHAs includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Sample sizes may vary because of missing values. Rounding may cause slight discrepancies in sums and differences. Outcomes shown describe only those households receiving any housing subsidies in the specified month. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 76

Appendix F

Exhibit F.3 Tenant Rent Share as a Percent of Monthly Gross Income Among Elderly and Disabled Households Receiving Subsidies

Outcome

SCCHA

Comparison PHAs

Tenant Rent Share Exceeds 40 Percent of Monthly Gross Income (%)

Last Month of Baseline

8.5

10.0

Last Month of Year 1

20.7

11.5

Last Month of Year 2

20.3

9.2

Last Month of Year 3

10.9

6.4

Tenant Rent Share Exceeds 50 Percent of Monthly Gross Income (%)

Last Month of Baseline

4.1

5.0

Last Month of Year 1

10.4

6.2

Last Month of Year 2

11.4

5.1

Last Month of Year 3

6.4

3.8

Median Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

29.1

29.4

Last Month of Year 1

35.0

29.5

Last Month of Year 2

32.0

29.4

Last Month of Year 3

32.0

29.3

Average Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

31.6

29.1

Last Month of Year 1

39.5

29.6

Last Month of Year 2

37.9

28.7

Last Month of Year 3

35.1

28.0

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Baseline (%) 0–25%

3.2

14.0

26–30%

75.6

62.9

31–35%

9.0

9.2

36–40%

4.1

4.5

41–50%

4.1

4.6

51% and Above

3.9

4.7

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 1 (%) 0–25%

0.1

13.6

26–30%

1.0

62.5

31–35%

68.7

8.3

36–40%

11.6

5.0

41–50%

8.9

4.7

51% and Above

9.6

5.9

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 2 (%) 0–25%

0.1

13.5

26–30%

1.8

68.8

31–35%

68.6

5.6

36–40%

10.5

3.4

41–50%

8.3

3.8

51% and Above

10.7

4.8

(continued)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 77

Appendix F

Exhibit F.3 Tenant Rent Share as a Percent of Monthly Gross Income Among Elderly and Disabled Households Receiving Subsidies (continued)

Outcome

SCCHA

Comparison PHAs

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 3 (%) 0–25%

0.1

13.6

26–30%

2.5

74.1

31–35%

82.8

3.8

36–40%

4.2

2.4

41–50%

4.2

2.4

51% and Above

6.1

3.7

Sample Size (Total = 20,004)

9,410

10,594

PHAs = public housing agencies. SCCHA = Santa Clara County Housing Authority.

Notes: The set of comparison group PHAs includes the Housing Authority of the County of San Mateo, the San Francisco Housing Authority, and the Housing Authority of the County of Alameda. Sample sizes may vary because of missing values. Rounding may cause slight discrepancies in sums and differences. Outcomes shown describe only those households receiving any housing subsidies in the specified month. Utility allowance data were not available for San Mateo and are therefore not included in San Mateo’s housing subsidy measures.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 78

Appendix G

Appendix G

Supplemental Exhibits for Subgroup Analysis

Exhibit G.1 Household Composition and Income at Baseline, Single Policy Change Nonelderly, Nondisabled Households Characteristic

SCCHA

SFHA

Average Number of Family Members

Adultsa

1.8

1.8

Children

1.4

0.9

Families with More Than One Adult (%)

53.6

53.9

Number of Children in Family (%)

None

38.8

48.4

1 Child

21.6

25.5

2 Children

16.5

13.7

3 or More

23.1

12.3

For Families with Children, Age of Youngest Child (%)

0–5 Years

40.5

28.3

6–12 Years

37.6

40.4

13–17 Years

21.8

31.2

Current/Anticipated Annual Family Income ($)

16,511

18,583

Current/Anticipated Annual Family Income (%)

$0

3.9

5.1

$1–4,999

18.4

9.5

$5,000–9,999

22.0

21.2

$10,000–19,999

23.5

26.2

$20,000 or More

32.1

38.0

Income Sourcesb (%)

Wages

60.7

63.0

TANF

22.6

17.2

Social Security/SSI/Pension

11.2

15.3

Other income sources

28.1

46.4

(continued)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 79

Appendix G

Exhibit G.1 Household Composition and Income at Baseline, Single Policy Change Nonelderly, Nondisabled Households

(continued)

Characteristic

SCCHA

SFHA

Average Annual Income from Wages, for Families with

Any Wage Income ($)

21,557

23,898

Annual Income from Wages, for Families with Any Wage Income (%)

$1–4,999

11.4

5.6

$5,000–9,999

15.4

14.7

$10,000–19,999

27.5

27.6

$20,000–29,999

20.1

21.7

$30,000 or More

25.5

30.5

Sample Size (Total = 6,915)

5,183

1,732

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aAdults are defined as individuals age 18 and older who were not classified on the HUD-50058 form as a live-in aide.

bIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 80

Appendix G

Exhibit G.2 Characteristics of Nonelderly, Nondisabled Adults at Baseline in Single Policy Change Households Characteristic

SCCHA

SFHA

Female (%)

63.8

62.0

Age (%)

18–24

30.6

28.4

25–34

19.1

18.6

35–44

18.4

14.9

45 or Older

31.9

38.1

Average Age (Years)

36.0

37.5

Race (%)

White, non-Hispanic

9.7

16.0

Black, non-Hispanic

15.3

32.7

Asian or Hawaiian or Pacific Islander, non-Hispanic

33.1

25.8

Hispanic

41.0

23.8

Other Race or More Than One Race, non-Hispanic

0.8

1.7

Income Sourcesa (%)

Wages

41.1

42.4

TANF

11.6

8.2

Social Security/SSI/Pension

1.9

6.4

Other Income Sources

14.5

27.4

Average Annual Income from Wages for Individuals

16,676

18,596

with Any Wage Income ($)

Annual Income from Wages for Individuals with Any Wage Income ($)

$1–$4,999

19.5

10.0

$5,000–$9,999

18.9

21.0

$10,000–$19,999

28.4

32.4

$20,000–$29,999

17.0

18.5

$30,000 or More

16.2

18.2

Individual Sample Size (Total = 15,050)

10,974

4,076

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 81

Appendix G

Exhibit G.3 Characteristics of Nonelderly, Nondisabled Households at Baseline, Single Policy Change Households Characteristic

SCCHA

SFHA

Average Monthly Family Sharea ($)

508

589

Average Monthly Family Share (%)

$0

2.1

2.3

$1–$299

40.5

31.2

$300–$599

26.5

28.5

$600–$899

15.9

17.7

$900 or More

17.1

22.2

Family Share as a Proportion of Monthly Gross Income (%)

0%–20%

1.3

1.2

21%–30%

46.8

29.0

31%–40%

28.3

39.1

41%–50%

7.5

11.7

51% or Above

16.1

19.1

Average Monthly Housing Subsidyb ($)

1,304

1,367

Average Monthly Housing Subsidy (%)

$0–$599

6.9

6.3

$600–$899

11.8

10.1

$900–$1,199

22.4

18.7

$1,200 or More

58.9

64.9

Payment Standard Reduced with New Rules (%)

0.0

0.0

Monthly Gross Rent Exceeds Payment Standard (%)

53.5

63.5

Neighborhood Poverty Ratec (%)

0%–10%

39.0

22.9

11%–20%

41.1

59.1

21%–30%

15.5

11.3

More than 30%

4.4

6.8

Sample Size (Total = 6,915)

5,183

1,732

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aFamily share is the family’s contribution toward the gross rent.

bHousing subsidy is the full subsidy amount paid by the housing agency. It includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

cPoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. Housing subsidy characteristics represent monthly averages.

Sources: MDRC calculations using HUD Public and Indian Housing Information Center; 2009–2013 American Community Survey 5-Year Estimates data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 82

Appendix G

Exhibit G.4 Household Composition and Income at Baseline, Nonelderly, Nondisabled Double Policy Change Households Characteristic

SCCHA

SFHA

Average Number of Family Members

Adultsa

2.2

2.3

Children

1.5

1.0

Families with More than One Adult (%)

74.1

73.5

Number of Children in Family (%)

None

23.3

33.0

1 Child

29.4

35.0

2 Children

32.9

29.2

3 or More

14.3

2.9

For Families with Children, Age of Youngest Child (%)

0–5 Years

26.0

11.6

6–12 Years

44.8

46.5

13–17 Years

29.2

41.9

Current/Anticipated Annual Family Income ($)

20,247

22,326

Current/Anticipated Annual Family Income (%)

$0

2.2

4.2

$1–4,999

11.9

8.9

$5,000–9,999

22.5

16.3

$10,000–19,999

23.2

24.3

$20,000 or More

40.2

46.3

Income Sourcesb (%)

Wages

65.2

68.4

TANF

25.4

20.3

Social Security/SSI/Pension

18.0

22.9

Other Income Sources

32.4

46.3

Average Annual Income from Wages, for Families

with Any Wage Income ($)

24,536

26,612

Annual Income from Wages, for Families with Any Wage Income (%)

$1–4,999

10.0

5.2

$5,000–9,999

13.4

13.0

$10,000–19,999

25.1

27.0

$20,000–29,999

18.7

17.9

$30,000 or More

32.7

36.8

Sample Size (Total = 1,991)

1,542

449

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aAdults are defined as individuals age 18 and older who were not classified on the HUD-50058 form as a live-in aide.

bIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 83

Appendix G

Exhibit G.5 Characteristics of Nonelderly, Nondisabled Adults at Baseline in Double Policy Change Households Characteristic

SCCHA

SFHA

Female (%)

64.6

62.9

Age (%)

18–24

35.9

34.5

25–34

17.7

17.3

35–44

17.6

13.8

45 or Older

28.8

34.4

Average Age (Years)

34.5

35.6

Race (%)

White, non-Hispanic

8.5

11.2

Black, non-Hispanic

14.0

34.0

Asian or Hawaiian or Pacific Islander, non-Hispanic

37.6

28.3

Hispanic

39.1

25.2

Other Race or More than One Race, non-Hispanic

0.8

1.4

Income Sourcesa (%)

Wages

41.2

40.9

TANF

11.1

8.2

Social Security/SSI/Pension

1.3

6.2

Other Income Sources

13.7

24.5

Average Annual Income from Wages for Individuals

with Any Wage Income ($)

17,273

19,126

Annual Income from Wages for Individuals with Any Wage Income ($)

$1–$4,999

20.8

9.2

$5,000–$9,999

18.2

23.9

$10,000–$19,999

26.5

30.3

$20,000–$29,999

15.7

15.6

$30,000 or More

18.9

21.1

Individual Sample Size (Total = 5,491)

4,157

1,334

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aIncome source categories are as defined on the HUD-50058 form. Wages include one’s own business, federal wages, PHA wages, military pay, and other wages. Other income sources include child support, medical reimbursement, Indian trust/per capita, unemployment benefits, and other nonwage sources.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 84

Appendix G

Exhibit G.6 Characteristics of Households at Baseline, Nonelderly, Nondisabled Double Policy Change Households Characteristic

SCCHA

SFHA

Average Monthly Family Sharea ($)

574

702

Average Monthly Family Share (%)

$0

2.3

2.6

$1–$299

33.3

22.3

$300–$599

28.1

28.5

$600–$899

17.5

19.4

$900 or More

21.1

29.6

Family Share as a Proportion of Monthly Gross Income (%)

0%–20%

0.5

0.2

21%–30%

51.0

32.7

31%–40%

31.9

35.2

41%–50%

7.7

13.8

51% or Above

8.9

18.0

Average Monthly Housing Subsidyb ($)

1,711

1,811

Average Monthly Housing Subsidy (%)

$0–$599

2.2

3.1

$600–$899

4.3

2.2

$900–$1,199

8.2

5.4

$1,200 or More

85.3

89.3

Payment Standard Reduced with new Rules (%)

100.0

100.0

Monthly Gross Rent Exceeds Payment Standard (%)

52.0

63.7

Neighborhood Poverty Ratec (%)

0%–10%

50.1

29.4

11%–20%

36.8

60.4

21%–30%

10.4

7.6

More than 30%

2.7

2.7

Sample Size (Total = 1,991)

1,542

449

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority. SSI = Supplementary Security Income. TANF = Temporary Assistance for Needy Families.

aFamily share is the family’s contribution toward the gross rent.

bHousing subsidy is the full subsidy amount paid by the housing agency. It includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

cPoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. Housing subsidy characteristics represent monthly averages.

Sources: MDRC calculations using HUD Public and Indian Housing Information Center; 2009–2013 American Community Survey 5-year estimates data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 85

Appendix G

Exhibit G.7 Estimated Effects on Housing Subsidies by Subgroup, Nonelderly, Nondisabled Households in SCCHA and SFHA Outcome

Difference Between Subgroup Estimated Effects

(Double Policy Change minus Single Policy Change)

P-Value

Total Annual Housing Subsidy ($)

Year 1

-4,032

0.00†††

Year 2

-4,461

0.00†††

Year 3

-3,340

0.00†††

Receipt of Housing Subsidy (%)

Year 1

0.7

0.17

Year 2

-1.8

0.28

Year 3

-3.3

0.12

Sample (Total = 8,901)

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Outcomes shown describe only those households receiving any housing subsidies in the specified month. Effects were estimated using an autoregressive difference-in-differences model, controlling for the past receipt of housing subsidies and other baseline characteristics of sample households. The estimates in the “Difference Between Subgroup Estimated Effects (Double Policy Change minus Single Policy Change)” column are calculated by subtracting the estimated effects for the single policy change subgroup from the estimated effects of the double policy change subgroup. The H-statistic is used to assess whether the difference in estimated effects between the subgroups is statistically significant. The “P-Value” column represents the p-value for the H-statistic. Significance levels are indicated as follows: ††† = 1 percent; †† = 5 percent; † = 10 percent.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 86

Appendix G

Exhibit G.8 Outcomes Related to Housing Assistance, Nonelderly, Nondisabled Single Policy Change Households Outcome

SCCHA

SFHA

Received Any Housing Subsidies (%)

Baselinea

100.0

100.0

Year 1

99.1

98.1

Year 2

93.2

94.9

Year 3

87.9

89.7

Total Tenant Payment (TTP), Among Households Receiving Subsidies ($)

Last Month of Baselineb

403

450

Last Month of Year 1

484

452

Last Month of Year 2

481

522

Last Month of Year 3

529

548

Housing Assistance Payment (HAP), Among Households Receiving Subsidies ($)

Last Month of Baselinec

1,320

1,389

Last Month of Year 1

1,194

1,381

Last Month of Year 2

1,244

1,406

Last Month of Year 3

1,377

1,461

Total Tenant Rent Share, Among Households Receiving Subsidies ($)

Last Month of Baselined

447

500

Last Month of Year 1

529

504

Last Month of Year 2

554

550

Last Month of Year 3

575

578

Sample Size (Total = 1,989)

5,181

1,731

aThe subsidy receipt status reported in HUD’s quarterly snapshot data files differed slightly from the status reported in HUD’s transactional data files. The baseline subsidy receipt status in this exhibit is based on Q2 to Q3 2013 quarterly snapshot data, while the status in the followup years are based on transactional data.

bTTP is the minimum amount a family must contribute toward rent and utilities regardless of the unit selected. For MTW households, TTP has been calculated to reflect the minimum rents in Santa Clara and San Mateo.

cHousing subsidy is the full subsidy amount paid by the housing agency on the household’s behalf and includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

dTotal tenant rent share is the family’s contribution toward the contract rent.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 87

Appendix G

Exhibit G.9 Outcomes Related to Housing Assistance, Nonelderly, Nondisabled Double Policy Change Households Outcome

SCCHA

SFHA

Received Any Housing Subsidies (%)

Baselinea

100.0

100.0

Year 1

99.7

98.2

Year 2

92.2

95.3

Year 3

85.7

91.1

Total Tenant Payment (TTP), Among Households Receiving Subsidies ($)

Last Month of Baselineb

497

539

Last Month of Year 1

539

543

Last Month of Year 2

534

671

Last Month of Year 3

596

721

Housing Assistance Payment (HAP), Among Households Receiving Subsidies ($)

Last Month of Baselinec

1,715

1,825

Last Month of Year 1

1,240

1,775

Last Month of Year 2

1,293

1,748

Last Month of Year 3

1,473

1,746

Total Tenant Rent Share, Among Households Receiving Subsidies ($)

Last Month of Baselined

511

579

Last Month of Year 1

810

621

Last Month of Year 2

784

727

Last Month of Year 3

753

797

Sample Size (Total = 1,989)

1,542

447

aThe subsidy receipt status reported in HUD’s quarterly snapshot data files differed slightly from the status reported in HUD’s transactional data files. The baseline subsidy receipt status in this exhibit is based on Q2 to Q3 2013 quarterly snapshot data, while the status in the followup years are based on transactional data.

bTTP is the minimum amount a family must contribute toward rent and utilities regardless of the unit selected. For MTW households, TTP has been calculated to reflect the minimum rents in Santa Clara and San Mateo.

cHousing subsidy is the full subsidy amount paid by the housing agency on the household’s behalf and includes any utility allowance payments made to the tenant in addition to rent paid to the owner by the housing agency.

dTotal tenant rent share is the family’s contribution toward the contract rent.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 88

Appendix G

Exhibit G.10 Outcomes Related to Households’ Housing Decisions Among Households Receiving Subsidies, Nonelderly, Nondisabled Single Policy Change Households

Outcome

SCCHA

SFHA

Neighborhood Poverty Ratea

Last Quarter of Baseline

11.9

15.3

Last Quarter of Year 1

12.0

15.3

Last Quarter of Year 2

12.3

15.0

Last Quarter of Year 3

12.5

15.1

Number of Bedrooms

Last Month of Baseline

2.5

2.2

Last Month of Year 1

2.5

2.2

Last Month of Year 2

2.5

2.2

Last Month of Year 3

2.5

2.2

Took a Port-Out Action (%)

Baseline

1.6

0.8

Year 1

1.6

3.1

Year 2

1.9

2.1

Year 3

1.9

1.6

Household Size

Last Month of Baseline

3.2

2.8

Last Month of Year 1

3.2

2.8

Last Month of Year 2

3.2

2.7

Last Month of Year 3

3.2

2.7

Sample Size (Total = 6,912)

5,181

1,731

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority.

aPoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Sources: MDRC calculations using HUD Public and Indian Housing Information Center data; 2007–2011 and 2012–2016 American Community Survey 5-year estimates

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 89

Appendix G

Exhibit G.11 Outcomes Related to Households’ Housing Decisions Among Households Receiving Subsidies, Nonelderly, Nondisabled Double Policy Change Households

Outcome

SCCHA

SFHA

Neighborhood Poverty Ratea

Last Quarter of Baseline

10.1

13.2

Last Quarter of Year 1

10.8

12.8

Last Quarter of Year 2

11.1

13.2

Last Quarter of Year 3

11.3

13.4

Number of Bedrooms

Last Month of Baseline

3.4

3.1

Last Month of Year 1

3.2

3.1

Last Month of Year 2

3.2

3.1

Last Month of Year 3

3.1

3.1

Took a Port-Out Action (%)

Baseline

1.4

1.6

Year 1

1.9

2.0

Year 2

2.3

1.6

Year 3

1.4

1.1

Household Size

Last Month of Baseline

3.7

3.3

Last Month of Year 1

3.6

3.3

Last Month of Year 2

3.6

3.2

Last Month of Year 3

3.6

3.2

Sample Size (Total = 1,989)

1,542

447

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority.

aPoverty rate is defined as the percentage of individuals ages 18 to 64 years whose income in the previous 12 months was below the poverty threshold.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Sources: MDRC calculations using HUD Public and Indian Housing Information Center data; American Community Survey, 5-year estimates (2007–2011 and 2012–2016)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 90

Appendix G

Exhibit G.12 Tenant Rent Share as a Percent of Monthly Gross Income Among Households Receiving Subsidies, Nonelderly, Nondisabled Single Policy Change Households

Outcome

SCCHA

SFHA

Median Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

29.1

29.5

Last Month of Year 1

35.0

29.5

Last Month of Year 2

32.0

29.3

Last Month of Year 3

32.0

29.4

Average Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

35.2

37.0

Last Month of Year 1

42.3

37.5

Last Month of Year 2

41.8

34.4

Last Month of Year 3

38.2

34.0

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Baseline (%) 0–25%

15.5

8.0

26–30%

59.7

62.5

31–35%

6.9

9.0

36–40%

3.6

4.7

41–50%

3.6

3.9

51% and Above

10.6

11.9

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 1 (%) 0–25%

0.4

8.3

26–30%

1.1

61.8

31–35%

68.9

8.5

36–40%

9.9

4.0

41–50%

6.1

4.1

51% and Above

13.6

13.3

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 2 (%) 0–25%

0.7

6.9

26–30%

2.0

76.4

31–35%

64.8

3.6

36–40%

9.5

2.2

41–50%

6.5

2.7

51% and Above

16.4

8.2

(continued)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 91

Appendix G

Exhibit G.12 Tenant Rent Share as a Percent of Monthly Gross Income Among Households Receiving Subsidies, Nonelderly, Nondisabled Single Policy Change Households (continued)

Outcome

SCCHA

SFHA

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 3 (%) 0–25%

1.0

7.2

26–30%

3.0

78.1

31–35%

76.3

2.8

36–40%

5.2

1.7

41–50%

4.0

2.2

51% and Above

10.5

8.0

Sample Size (Total = 6,912)

5,181

1,731

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 92

Appendix G

Exhibit G.13 Tenant Rent Share as a Percent of Monthly Gross Income Among Households Receiving Subsidies, Nonelderly, Nondisabled Double Policy Change Households

Outcome

SCCHA

SFHA

Median Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

29.1

29.5

Last Month of Year 1

35.0

29.5

Last Month of Year 2

32.0

29.3

Last Month of Year 3

32.0

29.4

Average Tenant Rent Share as a Percent of Monthly Gross Income (%)

Last Month of Baseline

30.5

34.5

Last Month of Year 1

57.6

37.2

Last Month of Year 2

52.3

34.9

Last Month of Year 3

44.7

36.0

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Baseline (%) 0–25%

17.6

6.4

26–30%

70.9

66.8

31–35%

4.3

9.4

36–40%

1.6

5.9

41–50%

1.5

2.3

51% and Above

4.0

9.2

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 1 (%) 0–25%

0.6

7.1

26–30%

1.6

59.7

31–35%

28.4

12.0

36–40%

11.1

3.3

41–50%

12.6

3.3

51% and Above

45.8

14.6

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 2 (%) 0–25%

0.8

5.1

26–30%

2.4

71.8

31–35%

38.2

6.9

36–40%

10.1

3.7

41–50%

10.8

3.7

51% and Above

37.7

8.8

(continued)

Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 93

Appendix G

Exhibit G.13 Tenant Rent Share as a Percent of Monthly Gross Income Among Households Receiving Subsidies, Nonelderly, Nondisabled Double Policy Change Households (continued)

Outcome

SCCHA

SFHA

Average Tenant Rent Share as a Percent of Monthly Gross Income in the Last Month of Year 3 (%) 0–25%

0.9

3.8

26–30%

3.6

71.1

31–35%

55.5

4.9

36–40%

8.4

5.4

41–50%

7.5

4.9

51% and Above

24.2

10.0

Sample Size (Total = 1,989)

1,542

447

SCCHA = Santa Clara County Housing Authority. SFHA = San Francisco Housing Authority.

Notes: Samples consist of households headed by adults who were not seniors or adults with disabilities. Sample sizes may vary because of missing values.

Rounding may cause slight discrepancies in sums and differences. Outcomes shown describe only those households receiving any housing subsidies in the specified month.

Source: MDRC calculations using HUD Public and Indian Housing Information Center data Evaluating the Effects of Santa Clara County Housing Authority’s Rent Reform 94

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Washington, DC 20410-6000

April 2020

Document Outline

Structure Bookmarks

Moving to Work Retrospective

Evaluating the Effects ofSanta Clara County HousingAuthority’s Rent Reform

Evaluating the Effects ofSanta Clara County HousingAuthority’s Rent Reform

Final Report

Acknowledgments

Disclaimer

Foreword

Contents

List of Exhibits

Abstract

Executive Summary

Chapter 1

Introduction and Background

Chapter 2

Research Design

Chapter 3

Findings

Chapter 4

Discussion

Appendix A

Appendix B

Appendix C

Appendix D

Appendix E

Appendix F

Appendix G

References