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The PubOrSubsidizedHousing module simulates the operation of the Department of Housing and Urban Development's (HUD) federal housing subsidy programs for renters. The rental subsidy programs, most notably the Public Housing and Section 8 programs, aim to provide affordable housing meeting minimum quality standards to low income families. The Public Housing and Section 8 project-based assistance programs finance the construction of housing projects specifically for low income tenants. The Section 8 Housing Choice Voucher Program provides low income families with vouchers that reduce the rent on existing, privately-owned housing. These housing programs are not entitlement programs, and annual funding levels are determined by appropriation. Households that meet eligibility requirements may be placed on a waiting list until a public housing unit or housing voucher is available. The PubOrSubsidizedHousing module uses CPS reported information to identify households residing in public housing or receiving government housing subsidies. For these households, PubOrSubsidizedHousing determines whether the household has income within the income eligibility limit (based on the number of persons in the household). It then determines the size (number of bedrooms) of the housing unit, based on household composition, and the unit's Fair Market Rent (FMR). PubOrSubsidizedHousing then calculates the household's rental payment according to housing program rules. The housing subsidy is calculated as the difference between the FMR and the household's rental payment. The subsidy calculation most closely approximates the operation of the Housing Choice Voucher Program, in which the local Public Housing Authority (PHA) pays the owner of the housing unit the difference between the household's required rental payment and the PHA's "payment standard", which is set at between 90 and 110 percent of the Fair Market Rent (or higher or lower with HUD approval). No such subsidy calculation is involved in the public housing and Section 8 project based housing programs, so the real-world subsidy value for these programs is less clear. Although some rules of the housing programs are set on a federal level, the programs are generally localized. The local PHA, which can cover an area as small as a section of a city, is given discretion over certain aspects of the programs, including reporting requirements and some aspects of the determination of the household's required rental payment. For simplification, the rules of the PubOrSubsidizedHousing module have been generalized to the state and federal level. In addition to calculating rents and subsidies for households that live in public or subsidized housing, the PubOrSubsidizedHousing module also imputes two variables required for simulating the SNAP excess shelter expense deduction—the housing expenses of non-subsidized households, and whether a household pays utilities separately from rent. Although the PubOrSubsidizedHousing baseline simulations typically use CPS reported information and HUD FMRs to identify assisted households and to calculate rents and subsidies (as described above), other types of simulations are possible. PubOrSubsidizedHousing can increase the number of assisted households by selecting a percentage of non-reporter households to receive housing assistance. Rental payments and subsidies can be calculated using a variable specifying the actual rent for the housing unit (if such a variable is made available). Finally, if information about public or subsidized housing status is not available in the survey data used as input to the model, PubOrSubsidizedHousing can select eligible households to be assigned to participate in public or subsidized housing. A more detailed discussion of the PubOrSubsidizedHousing module is outlined as follows:
1. Monthly Accounting PeriodThe PubOrSubsidizedHousing module operates on a monthly accounting period as a generalization of local rules regarding the reporting of changes in income. All tenants are required by Federal regulations to have their income recertified at least annually. It is left to the discretion of the local PHA to decide when re-certification is required more frequently. The majority of PHAs require that a large change in income be reported immediately by the tenants. Therefore, the PubOrSubsidizedHousing module operates on a monthly rather than annual basis. Note that this generalization may overstate the speed with which changes in tenant income affect the subsidy benefit if, in practice, changes are only reported at the annual recertification. 2. Filing UnitPubOrSubsidizedHousing uses the CPS household as the filing unit. The household reference person is considered to be the head of the household. 3. Eligibility and ParticipationCPS PubOrSubsidizedHousing baseline simulations start from survey-reported information regarding whether a household lives in public housing or receives a housing subsidy (CPS variable PublicHousing=1 or CPS variable GovernmentSubsidy=1). The PubOrSubsidizedHousing module applies an income test as follows. If EligibilityLimitMethod indicates that the state-average income eligibility limits are to be used, then the income eligibility limits are obtained from program rule IncomeEligibilityLimits. The annual income limits in this rule vary by state and household size and are compared to a reporting household's gross cash income. However, if EligibilityLimitMethod indicates that local area IncomeEligibilityLimits are to be used, then the income eligibility limits are obtained from person-level variables specified through a set of eight variable list rules -- IncomeLimitVar1 through IncomeLimitVar8.If the income exceeds a household's limit, then even though the household reports being in a housing program, the simulation does not consider the household to be eligible or participating. Even when household income is within the applicable income limit, some reporter households have income that is high enough that they are simulated to pay the full FMR and do not receive a subsidy. Analysts may choose to exclude these households from the count of assisted households when analyzing the results. Analysts can increase the number of households treated as being in public or subsidized housing by selecting some non-reporter households to be treated as if they are reporters. The following rules control the selection of non-reporters to be treated as if they are reporters. RateNonRepTreatedAsRep specifies the percentage of households that do not report being in public or subsidized housing that are to be treated as reporters. This percentage is only applied to households meeting the criteria defined by the following rules:
4. Fair Market Rent DeterminationFair Market Rents are calculated by HUD each year and reflect the 40th or 50th percentile for rents charged for standard rental housing. If FMRMethod indicates that the state-average income FMRs are to be used, then the FMRs are obtained from program rules FMROneBdmStateOneToFiftyFive through FMRNineBdmOneToFiftyFive and are adjusted for metropolitan and non-metropolitan status through FMRAdjustment. Otherwise, if FMRMethod indicates that local area FMRs are to be used, then the FMRs are obtained from person-level variables specified with variable list rules FMRVar0 through FMRVar9. The CPS does not ask households to report the number of bedrooms in their housing unit. If an alternative data source is being used that does include a variable with this information, it can be specified through program rule NumberOfBedrooms. Otherwise, TRIM3 imputes the number of bedrooms. BedroomsImputationOption, introduced with Version 25, specifies the method to be used to impute the number of bedrooms. The first option calculates the number of bedrooms according to the method used prior to the development of Version 25, the "Minimum Bedrooms Formula," that is described below. The second option uses cumulative percentages entered through the "Cumulative Percentages" group of rules to assign the number of bedrooms to households with one or two adults and up to three children. The "Minimum Bedrooms Formula" method and additional rules are used to assign the number of bedrooms to types of households not included in the "Cumulative Percentages" household categories. The Minimum Bedrooms formula assigns the number of bedrooms as follows:
The "Cumulative Percentages" group of rules applies to all states and contains values for 1, 2, 3, 4, and 5 bedrooms. The rules are used only if BedroomImputationOption specifies that the code should "Use Percentages and Formula" and an actual number of bedrooms has not been specified through NumberOfBedrooms. The rules in the "Cumulative Percentages" group specify the cumulative percentages used to assign the number of bedrooms. If a household's random number is less than or equal to the percentage entered for one bedroom, then one bedroom is assigned. Otherwise, if a household's random number is less than or equal to the cumulative percentage entered for two bedrooms, then two bedrooms are assigned, and so on. The rules distinguish between subsidized, owned, and rented units. Reported information is used to determine if the household is subsidized or in public housing (TRIM3 variable GovernmentSubsidy= 1 or PublicHousing= 1) and whether the household is owned or rented (TRIM3 variable Tenure). Values also vary by family composition (1 adult without children, 2 adults without children, and married or cohabiting adults with 1 child, 2 children, or 3 children respectively). If a household does not match one of these combinations, then the number of bedrooms is assigned through the minimum bedrooms formula. For example, a household with two adult sisters and one sister's child does not fit in any of the "Cumulative Percentages" rule categories and would be assigned a number of bedrooms through the minimum bedrooms formula. Households that do not meet one of the “Cumulative Percentages” rule categories can be randomly assigned an additional bedroom (beyond the number assigned through the minimum bedrooms formula) based on the percentages specified in AdditionalBedroom_Sub (for renters that are reported to be in public or subsidized housing, AdditionalBedroom_Rent (for other renters), and AdditionalBedroom_Own (for owners). The total number of bedrooms assigned to households that report receipt of public or subsidized housing is capped at a number, based on the number of people in the household, specified by AdditionalBedroom_SubCap. 5. IncomeIn the housing programs, a household's gross annual income equals most earned and unearned income for all household members. Allowable exclusions from income for the housing programs include: employment income of children less than 18, educational assistance, lump sum additions to assets (such as insurance payments, capital gains income, and workers compensation received in a lump sum), foster care payments, amounts received specifically for medical expenses, income of a live-in aide, Armed Forces "hostile fire" pay, amounts from HUD and other government training programs, nonrecurring gifts, and amounts disregarded for SSI as set asides for a Plan to Attain Self Sufficiency. Note that income includes cash payments from TANF, SSI, and general assistance. PubOrSubsidizedHousing calculates the monthly gross household income by summing the unearned income items specified in the rule UnearnedIncome for each member of the household and earned income specified in the rule EarnedIncome for adult members. A person is considered an "adult" if he or she is an economic adult (with his/her own income information in the input data) and s/he is either the head of the household, the head's spouse, or at least as old as the age specified in the rule AdultAge. Both total earned income and total gross income are reset to zero when negative. PubOrSubsidizedHousing models the exclusions for employment income of children under 18 and educational assistance income but does not model the other exclusions. Annual gross income is calculated by summing the monthly gross income amounts. TreatmentOfChildSupportPaid enables the user to request that child support paid to another household be excluded from gross income or deducted when calculating adjusted income. If either option is selected, then variable list rule ChildSupportPayment must specify the variable containing the child support payment amount. 6. DeductionsIn the housing programs, the following items are deducted from annual gross income to determine annual adjusted income:
PubOrSubsidizedHousing simulates all of the above deductions except for the deduction for handicap assistance expenses. (Medical Expenses for households with an elderly or disabled head or spouse were not simulated prior to version 27.0). "Elderly" is defined as being at least the age specified by ElderlyAge. A person is considered disabled if he or she is considered disabled under the definition of disability used to determine eligibility for SSI. Prior to version 8_0, the disability definition was hardcoded within PubOrSubsidizedHousing. Beginning with version 8_0, disability status is obtained from the SSI simulation (the person does not have to have to be eligible for or participating in SSI). The SSI disability status variable (AnnualSSIAgedDisabledStatus) is specified through the rule SSIEligType. PubOrSubsidizedHousing simulates each deduction as follows: The dependent allowance, elderly or disabled allowance, and medical expense deduction are annual deductions that are divided by twelve to yield monthly amounts. Child care expenses are input using a monthly variable, so no modification is needed. The monthly deductions are subtracted from monthly gross income to yield monthly adjusted income. If monthly adjusted income is negative, it is set to zero. Annual adjusted income is calculated by summing monthly adjusted income. As noted previously, TreatmentOfChildSupportPaid includes an option to treat child support payments to other households as a deduction. If so, the monthly amount of the child support deduction is obtained from the variable specified by ChildSupportPayment. 7. Rent and Subsidy CalculationA household's housing subsidy is equal to the difference between the FMR of the housing unit and the household's required rental payment. However, if information about the actual rent is provided through the program rule ActualRent, then the calculation may differ (see section 9 for details). PubOrSubsidizedHousing sets a household's required rent equal to the larger of: (1) the percent of gross income specified by PercentGrossIncomeForRent; and (2) the percent of adjusted income specified by PercentAdjustIncomeForRent. If this results in a required rental payment that is less than the amount specified by MinimumRent, then the rent is set equal to the lesser of MinimumRent and the percent of gross income specified by MaxPctIncomeOnMinRent. If the required rental payment is larger than the total rent for the housing unit, then the household's rent is set equal to the total rent. The household's annual rent is calculated by summing the monthly amounts. PubOrSubsidizedHousing computes the monthly housing subsidy by subtracting the participating household's monthly payment from the FMR. When a particular month's required rent equals the FMR, the subsidy is $0 for that month. The annual subsidy is calculated by summing the monthly amounts. PubOrSubsidizedHousing does not capture the rules that pro-rate the subsidy received by households containing ineligible noncitizens or that require households receiving cash welfare payments earmarked for housing expenses to pay at least the earmarked amount in rent. 8. Housing Expense Determination for Non-Subsidized HouseholdsA secondary purpose of the PubOrSubsidizedHousing module is to impute housing expenses for households that do not live in public or subsidized housing so that a shelter expense deduction can be calculated for these households in SNAP simulations. Housing expenses are imputed for all households that report that they are paying rent or that they own or are buying a house. If a household indicates in the CPS interview that it lives rent-free, its housing expense is set to zero. Otherwise, the household's housing expense is set equal to the lesser of (1) the FMR, or (2) the percentage of average monthly gross income specified by PercentGrossIncomeHouse. As discussed below, additional adjustments can be applied to the resulting expenses if indicated by ApplyHousingExpenseAdjustments. The FMR is calculated using the same methodology as is used for households that live in public and subsidized housing. Average monthly gross income is calculated by adding the household's reported SNAP benefits (CPS variable FoodStampsValue) to annual gross income and dividing by 12. The expenses that are imputed for households that do not live in public or subsidized housing should be reasonable for most low-income renters served by SNAP (where the expenses are used to calculate the excess shelter expense deduction). However, the estimated expenses probably understate the housing expenses of middle and upper-middle income households, because they are based on FMRs and assume that all households rent or purchase housing units similar to those rented by families receiving housing assistance. Beginning with Version 24, ApplyHousingExpenseAdjustments indicates whether to adjust imputed expenses to reflect differences in the housing costs of low-income households for housing units that are owned with a mortgage, owned without a mortgage, rented with utilities included in rent, or rented with utilities paid separately. The adjusted expenses are stored in output variable, MonthlyHousingExpAdjusted. MonthlyHousingExpAdjusted is computed by multiplying the output variable MonthlyHousingExpenses by a factor that varies by number of bedrooms (1, 2, 3, or 4+) and whether a housing unit is owned with a mortgage, owned without a mortgage, is rented with utilities included in rent, or is rented with utilities paid separately. The multiplicative adjustments are specified through program rules OwnWithMortgageAdj, OwnNoMortgageAdj, UnsubRentUtilInclAdj, and UnsubRentUtilSepAdj. If adjustments are to be performed, then a variable indicating whether the household has a mortgage must be specified for program rule HasMortgage. In Version 26.1 the person-level result variable MonthlyHousingExpAdjPerPerson was added to store the average adjusted housing expense per person in the household. The PubOrSubsidizedHousing module includes two alternative approaches to assigning housing expenses to households that are not in public or subsidized housing: (1) the household's housing expenses from the baseline simulation may be used (in alternative simulations); and (2) the household's actual rent (if available) may be used. See section 9 for a discussion of the use of actual rent and section 12 for a discussion of the use of baseline housing expenses in alternative simulations. 9. Simulations Using Actual RentThe program rule ActualRent allows the user to specify a variable containing the actual rent of the household's housing unit. This variable is not available on the CPS, so is not used in the CPS PubOrSubsidizedHousing baseline simulations. If a variable is specified for ActualRent, then PubOrSubsidizedHousing uses the following methodology to calculate rental payments and housing subsidies for households that report that they live in public housing or receiving housing assistance. First, a required rental payment for the household is calculated according to the methods described in section 7, and the subsidy is set equal to the difference between the required rental payment and the smaller of the actual rent and the FMR. If the actual rent is greater than the FMR for a subsidized household, then the household is required to pay the difference between the FMR and the actual rent as additional rent. If a variable is specified for ActualRent and the household does not report living in public housing or receiving housing assistance, then the household's rent is set equal to ActualRent. 10. Simulating Whether Households Pay UtilitiesBeginning with version 23.0, the CPS PubOrSubsidizedHousing baseline imputes whether or not a household pays utilities separately from rent and stores the result in output variable HouseholdPaysUtilities. HouseholdPaysUtilities is set to "yes" for homeowners, persons for whom the household-level input variable, Tenure, is equal to 1. Renters that receive energy assistance (as indicated by the variable specified by EnergyAssistanceIncome) are automatically assigned to pay utilities separately from rent, unless their energy assistance income is less than or equal to the threshold specified for their state in EnergyAssistanceThreshold. Renters with energy assistance income below the specified threshold are imputed to not pay utilities separately from rent. Renters without energy assistance income are randomly assigned to pay utilities separately from rent based on probabilities specified through PctPayUtilities. PctPayUtilities is a program rule that contains fractional values that range from 0 to 1 and that vary by state and by whether or not a subsidy is received. A subsidy is considered to be received if simulated output variable, AnnualSubsidyReceived, is greater than zero. In alternative simulations, HouseholdPaysUtilities is recalculated for households in public or subsidized housing. RecalculateHousingExpenses indicates whether the variable is recalculated for non-subsidized households. If RecalculateHousingExpenses indicates that HouseholdPaysUtiltities is not recalculated, then the baseline value of the variable is obtained with program rule BaselineHHPaysUtiltities. Using program rules IdentifyRentAndUtilities, UtilityAllowance, and UtilityReimbursementOption, the PubOrSubsidizedHousing module can split rent payments for public and subsidized housing into separate utilities and rent shares. When IdentifyRentAndUtilities is set to "yes", the shares of rent payment going toward utilities and owner rent is calculated, using UtilityAllowance to determine how much a household should be paying for utilities. UtilityReimbursementOption is used to toggle whether households that pay utilities separately from rent and for which the utility allowance exceeds the household's required monthly payment receive a utility reimbursement. Results of the calculations are stored in result variables MonthlyOwnerRentPaid, MonthlyUtilitiesPaid and MonthlyUtilityReimbursement. 11. Imputing Public and Subsidized Housing Status in Absence of Reported DataIf a dataset lacks a variable indicating that a household receives a housing subsidy or lives in public housing, public or subsidized housing status can be assigned by selecting participants from among the households found eligible for subsidies. This capability is invoked when SimulationMode is set to “Simulate Eligibility and Participation.” This simulation mode also relies on the input dataset including a variable for reported rent. Once eligible households have been identified, three basic steps are used to select participant households:
Click here for additional details about "Simulate Eligibility and Participation" mode. 12. Alternative SimulationsThe PubOrSubsidizedHousing module contains two alternative simulation modes, each specified through the SimulationMode program rule. The “Alternative” mode is used when conducting a simulation for comparison with a prior simulation performed in “Baseline” mode. The “Re-calculate Rent and Simulate Eligibility and Participation” mode is used when conducting a simulation for comparison with a prior simulation performed in the “Simulate Eligibility and Participation” simulation mode. This mode re-calculates rent for households that were determined to be subsidized in an “Eligibility and Participation” baseline simulation, and re-determines eligibility and participation for households not previously identified as subsidized. The instructions below pertain to PublicOrSubsidizedHousing code versions 30 and higher. For information on performing alternative simulations in earlier versions, contact TRIM3 staff.
13. Output VariablesPubOrSubsidizedHousing produces the following variables for households that report living in public housing or receiving housing assistance (or are simulated to do so) and stores the variables on the record of the household reference person. MonthlyRentPaid and AnnualRentPaid indicate the household's monthly and annual required rental payment. MonthlySubsidyReceived and AnnualSubsidyReceived indicate the household's monthly and annual subsidy. If a variable is specified for ActualRent then the additional rent required of the household is output through MonthlyExtraRent and AnnualExtraRent. PubOrSubsidizedHousing also produces person level versions of the above variables. MonthlyRentPaidPerPerson, AnnualRentPaidPerPerson, MonthlySubsidyReceivedPerPerson, AnnualSubsidyReceivedPerPerson, MonthlyExtraRentPerPerson, and AnnualExtraRentPerPerson are stored with each person in the household and are calculated by dividing the household's rent or subsidy by the number of people in the household. The monthly housing expenses for households that do not report in public housing or receiving housing assistance (and are not simulated to do so) are output through MonthlyHousingExpenses and MonthlyHousingExpAdjusted. MonthlyHousingExpenses is an annual variable stored with the household reference person. It represents the household's monthly housing expenses, which are assumed to remain constant throughout the year. MonthlyHousingExpAdjusted reflects the housing expenses in simulations in which adjustments have been applied to reflect differences between households that own with a mortgage, own without a mortgage, pay utilities separately from rent, or have utilities included in rent. The person-level variables MonthlyHousingExpensePerPerson and MonthlyHousingExpAdjPerPerson reflect the household's monthly housing expenses divided by the number of people in the household. HouseholdPaysUtilities is created in “Baseline” and “Alternative” mode and indicates whether the household has been imputed to pay utilities separately from rent. InPublicOrSubsidizedHousing is created in “Simulate Eligibility And Participation” mode and indicates whether the household has been assigned to be in public or subsidized housing. See the TRIM3 dictionary for information about other variables produced by the PubOrSubsidizedHousing module. |
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