George Hinson lived at the Station House in Philadelphia for eight years. The former train station had been converted into apartments serving low-income Philadelphians, many of whom, like Hinson, were recovering from addiction. But the building had fallen into a state of disrepair. According to residents, it was infested with rodents and bedbugs, covered in mold, had faulty lighting, and poor heating and ventilation.
By 2015, the owner of Station House decided to renovate it. Volunteers of America Delaware Valley, part of a national, Christian-based nonprofit that provides services to homeless people and other vulnerable populations, renamed the building The Lofts at 2601. In exchange for fixing the building, Volunteers of America received low-income housing tax credits through a U.S. Housing and Urban Development program called Rental Assistance Demonstration (RAD).
But Hinson never got to enjoy the upgraded apartments.
He ended up homeless.
The RAD program was created by the Obama administration in 2012 to tackle the severe backlog of needed repairs at America’s 1.1 million public housing units. It’s designed to motivate private developers to renovate or rebuild public housing: In a RAD “conversion,” public housing authorities turn over low-income housing to private developers, who receive private activity bonds or low-income housing tax credits to repair or rebuild dilapidated housing. Once construction is complete, the developers own and sometimes even manage the former public housing properties.
The law requires the new owners to keep each renovated unit affordable, both for existing and future tenants. That doesn’t always happen.
Tenants can be moved off-site while their apartments are under construction, but afterward, they have the right to return or to receive federal housing vouchers to help cover rent on the private market.
But for years, tenants’ advocates have claimed that residents often were treated unfairly — in violation of HUD rules intended to safeguard their rights — either by being placed in uninhabitable housing during construction or by being displaced or illegally re-screened after renovations were complete.
Hinson said he was pressured by property managers into waiving his right to return to his home after renovations were completed, and then denied his right to federal housing vouchers. That forced him to look for a new place to live in the expensive private market — without any of the required support.
HUD Spokesman Brian Sullivan said HUD is investigating Hinson’s case and cannot draw any conclusions until the investigation is done.
A ThinkProgress investigation shows that HUD is attempting to dramatically expand this federal program that privatizes dilapidated public housing without providing enough oversight to ensure that the very people it is supposed to help — low-income tenants — are protected. Low-income housing advocates say the Rental Assistance Demonstration program has a history of pushing people who already are living on society’s margins out of their homes and into dangerous and hazardous living conditions.
Advocates, tenants, and current and former HUD officials told ThinkProgress the federal agency is often slow to respond to complaints that tenant rights have been violated during or after a RAD conversion, and that it does not have the technology or staffing to properly oversee the program. Critics also say there is no guidance governing how developers should manage their properties after a conversion.
The U.S. Government Accountability Office (GAO) reported in 2018 that HUD’s inability to track people through the system put tenants and the long-term affordability of renovated homes at risk.
HUD spokesperson Jereon Brown said the federal agency is in the process of “building all the necessary oversight infrastructure” for RAD, noting it is still a new program and the agency is “learning” from each complaint it receives. HUD officials also told ThinkProgress that the agency has tweaked the way it tracks tenants following a conversion and recently hired new staff members to help oversee the program, though none are dedicated solely to monitoring whether RAD rules and rights are being followed.
As early as January 2017, attorney Rasheedah Phillips started to complain to HUD about problems at the The Lofts at 2601. After months of inaction by HUD, she and a colleague at Community Legal Services of Philadelphia filed a formal complaint last July. Five months later, on Dec. 17, Tom Davis, current director of HUD’s Office of Recapitalization, which oversees RAD, said his office was looking into Phillips’ complaint. Davis told the National Housing Law Project in a Feb. 19 email that the investigation had been set back by the government shutdown, but that it is ongoing.
Sullivan said if Hinson’s case is true, “this one example is certainly not how this program is designed to operate.”