I-Team: People With Six-Figure Incomes Living In Taxpayer-Subsidized Housing
BOSTON (CBS) - Like thousands of other low-income residents in Boston, Angelina Depina, 26, knows how tough it is to find an affordable place to live.
To qualify for subsidized public housing options, prospective tenants have to meet income restrictions. There is a lot of competition for a limited number of vacancies. In Boston, the waiting list has 38,000 applicants.
This Dorchester working mom was surprised to learn hundreds of families around the state are earning well above those income limits.
"I think it's a smack in the face, honestly," Depina said. "It's really disgusting because there truly are individuals who are really struggling."
At Orchard Gardens in Roxbury, one family of four reported a $228,000 income. At another development in Dorchester's Mission Hill neighborhood, five different families brought in six-figure salaries.
"Is it fair? No, it's not fair," Depina said. "It might be legal, but it's morally wrong."
The families all met income guidelines when they applied for the program. The issue: since obtaining jobs and earning higher salaries, nobody from the housing authorities has told them to pack up and move into the private market.
In a scathing report, the inspector general of the Department of Housing and Urban Development (HUD) revealed more than 25,000 families living in public housing units nationwide are now "overincome."
The agency's watchdog cited several "egregious" examples, including a case in New Bedford. According to the audit, the three-person household had a reported income of $212,845, well above the eligibility threshold of $42,950. The family paid a monthly rent of $525.
"It is a complicated issue," said Lydia Agro, a spokeswoman with the Boston Housing Authority.
Agro and other state housing authority leaders say "overincome" residents are a very small percentage of their housing populations (the federal audit estimated the nationwide figure at about 2 percent).
Housing administrators argue the high-income residents pay the highest rent amounts at a time when federal funds are strapped for cash. Those "flat rent" amounts are set at 80 percent of the fair market value in the city.
In Boston, for instance, the current flat rents are $1,195 for a two-bedroom apartment and $1,618 for a four-bedroom unit. Agro said families paying the higher amounts add up to $3 million per year in rent revenue for the BHA.
Local housing authority directors also claim the families are good role models and bring economic diversity to the neighborhoods.
"We don't want to create communities where all of our resident population is very low income and there are no working families," Agro explained.
The I-Team reviewed public housing records and found some eye-popping dollar amounts all over the state. Families reported six-figure incomes everywhere from Lynn-to-Fall River and Somerville-to-Worcester.
Data provided by HUD and the local housing authorities did not include resident names or addresses because of privacy reasons, only the income amounts.
Of the 622 "overincome" families listed in the Massachusetts records, more than half made $10,000 over the income guidelines.
Several families surpassed those eligibility limits by more than $100,000. One family in Somerville was $10 over the limit.
Cambridge Housing Director Greg Russ believes the inspector general report was misleading.
Russ said the majority of "overincome" families have multiple wage earners in the household. For instance, the highest-earning tenants in Cambridge bring in $200,000 — a family of six with four different salaries.
"A lot of these families could not move into the private market and stay here," Russ said, citing a recent city-issued report that stated a family needs $108,000 to "make it" in Cambridge. "There has to be a pathway out."
But a Massachusetts Congressman told the I-Team people with excess income should not remain in subsidized housing. Rep. Michael Capuano (D-7th District) said the eviction process would have to be carefully considered.
"If you go over by a dollar, should you be kicked out the next day? The answer is no," Capuano said. "But if you go over by $100,000, I would argue give yourself a 30, 60 or 90-day time frame to say, 'Good for you. It worked. Now, it's time to move on.'"
In the wake of the audit, the federal agency is already instructing local housing authorities to make some changes.
"HUD strongly encourages public housing authorities to utilize the discretion available to them to remove extremely overincome families from public housing," read a letter sent to executive directors across the country.
In Boston, Agro said a committee has formed to study the issue and write a new policy. The changes will be presented for public comment in the near future, she said.
Evicting all the "overincome" residents from taxpayer-subsidized housing would only make a small dent in the waiting lists. But Depina, the working mom and full-time student, said it would create spots for those who truly need them.
"The system they have now is definitely flawed and needs to be readjusted," she said.
Ryan Kath can be reached at rkath@cbs.com. You can follow him on Twitter or connect on Facebook.
