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Report exposes wealthy families using public housing subsidies, HUD reverses position, begins evictions

When a revealing report was issued about HUD subsidizing families whose income is higher than the limit, the Department reacted today with eviction notices.

hud public housing

The independent Office of the Inspector General issued a report this week that revealed thousands of families living in public housing earning more than the maximum allowable income threshold. HUD has reacted by saying it is beginning their attempts to evict these tenants.

It was called a major scandal, but the truth is that the report revealed a major flaw in the public housing system in that an applicant’s income must be under a certain level to qualify, but at no point are qualification standards checked again.

Therefore, a family may qualify today and get accepted into the housing program, but five years later, they’ve quadrupled their earnings and no longer qualify, but no one has checked up on it.

This has been happening while the roughly 580,000 families on the waiting list that are truly in need must continue to wait.

Sure, people are upset

It made sense that people were upset, as the report illustrated the problem with one New York family with an income of over $500,000 paying $1,574 a month to live in taxpayer subsidized public housing. Speaking of New York, the state hosts the majority of the over-earners:

hud ig report

Critics of this issue point to the IG report’s indication that the cost to taxpayers of these overqualified families alone will be $100 million in the next 12 months.

The fallout: more investigations

Rep. David Jolly (R-FL) immediately called for a congressional investigation, stating, “With an ever-growing waitlist for housing assistance from those truly in need, these incidences of waste, fraud and abuse must be eliminated immediately. It is time to clean house at HUD.”

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Jolly is on the House Committee on Appropriations Subcommittee for Transportation, Housing and Urban Development, which oversees federal dollars for HUD programs. In a letter sent to a letter to Secretary Julian Castro, Jolly wrote:

“Every American taxpayer deserves to know that their tax dollars are used for those rightfully in need of assistance, and not irresponsibly squandered by subsidizing those in the highest income brackets,” Jolly wrote.

HUD initially refused to take action

HUD’s initial response was that evicting the over-income families would “negatively affect their employment and destabilize properties.” Further, these over-income families were encouraged to stay to diversify the mixed-income communities and serve as role models for others.

Milan Ozdinec, HUD’s deputy assistant secretary for public housing and voucher programs wrote a rebuttal to the report, stating that “There are positive social benefits from having families with varying income levels residing in the same property,” and that “Forcing families to leave public housing could impact their ability to maintain employment if they are not able to find suitable housing in the neighborhood.”

Ozdinec added that “for families with children, it may be more difficult to find affordable child care, and it may impact school-age children’s learning if they are forced to change schools during a school year.”

HUD reverses their position, begins evicting

Although the IG report never called for the families to be evicted, rather asserted that HUD should take action on the most “egregious” cases.

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“This audit, like others, provides HUD an opportunity to re-evaluate policies and initiatives and make improvements where necessary,” HUD spokesman Jereon M. Brown said today in a statement. “As a result, HUD is taking additional steps to encourage housing authorities to establish policies that will reduce the number of over income families in public housing.”


Lani is the COO and News Director at The American Genius, has co-authored a book, co-founded BASHH, Austin Digital Jobs, Remote Digital Jobs, and is a seasoned business writer and editorialist with a penchant for the irreverent.


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