JANESVILLE—The first week Janesville's rent assistance program began accepting applications after two years, about 700 local families applied.
Local demand for rent assistance is high and possibly growing, but the supply of available rental properties and federal funding are low, said Jennifer Petruzzello, neighborhood and community services director.
“…There's a very high demand, a high need for the program that we're not able to meet … mostly because of funding issues,” she said.
The city's rent assistance program pays an average of $400 a month for eligible tenants' rent and utilities. To be eligible, an applicant must not have been convicted of a sexual, violent or drug-related crime and be in the “extremely” or “very low” income bracket. They also must pay 30 percent to 40 percent of their monthly income toward rent, depending on the cost of their rented property.
A single person must make less than $12,650 a year to be considered in the “extremely low” income bracket or $21,100 a year to be considered having “very low” income. For a family of four, those numbers rise to $24,300 and $30,100 respectively.
At least 75 percent of those the program helps must be in the “extremely low” income bracket, Petruzzello said.
“Our tenants' average income is a little over $11,000 a year,” she said. “It's really very low.”
The program helps about 500 families a month. As people either move out of the area or become ineligible for the program, new applicants are approved and helped, Petruzzello said.
More than 760 families are on a waiting list, which is “pretty high,” she said.
“The question everybody asks is 'how long?' and we can't really answer that question,” she said.
The program reopened applications in April for the first time in two years. When the program closed applications in 2014, about 780 families were on the waiting list. The oldest application stretched back to 1996, Petruzzello said.
The program closed applications in 2014 to stop giving applicants false hope they'd be helped. Administrators worked through the 780 applications before accepting any new ones.
In that process, staff found several had moved out of the area. Others had become ineligible for the program.
Administration helped about 200 local families in the two years before 2016. They helped others who immediately moved out of the area.
When April rolled around, the waiting list was empty so the program opened applications.
One challenge that has led to a large waiting list is a shortage of rentable space available. Landlords have to opt into the program, Petruzzello said.
The program's administration has begun surveying local landlords to see how many know about the program and if they'd be willing to participate. Landlords can take the survey at surveymonkey.com/r/landlord2016.
Many landlords are leery of the program because it requires a mandatory inspections that could uncover violations and lead to annual inspections, said Dale Hicks, president of the Janesville Area Rental Property Association.
Landlords also might be concerned about accepting tenants on a rent assistance program thinking they might not take care of the property, he said.
“I think the biggest challenges for our tenants are finding decent, safe housing in the community that they can rent and being able to keep that affordable for them and their families,” Petruzzello said.
HIGH RENTAL RATES
Janesville's tightening rental market isn't making things easier.
The U.S. Department of Housing and Urban Development sets a fair market value for property sizes and locations. A tenant must find a property at or below the fair market value to pay only 30 percent of their income for rent and utilities. If a property's rent is above fair market value, the tenant has to offset the cost, paying up to 40 percent of their income.
More than half of the residents using Janesville's rent assistance program are paying more than the 30 percent minimum, and that's mostly because they're living in properties above fair market value, Petruzzello said.
“I think Janesville needs more affordable housing opportunities,” she said. “Housing in Janesville has been considered affordable for a long time, but the market's been rapidly changing on the rental side.”
“Rents are going up because of the fact we have less than a 1 percent vacancy rate,” Hicks said.
The fair market value for a one-bedroom apartment in Janesville is $592 a month, but the U.S Department of Housing and Urban Development set rates can lag behind market trends. The rental market is changing fast enough that the average rental fee for a one-bedroom apartment could be above $592 a month, Petruzzello said.
Options for low-income families besides the rent assistance program are limited. There are no public affordable housing projects for low-income individuals in Janesville. Private ones are full most of the time, Petruzzello said.
Another roadblock the program faces is funding.
The rent assistance program is funded entirely by the U.S. Department of Housing and Urban Development, but money is capped, limiting how many residents the program can help.
For the past few years, the Janesville program has received $2.4 million to $2.5 million in federal funding. In 2012, the department funded the staff with $289,000, but federal cuts dropped that amount to $250,000 in 2013, forcing to program to reduce staff. That means it takes longer to get applicants processed, approved and helped, Petruzzello said.
Administrative funding has been climbing back up ever since, “which is good,” she said.
But what do those sitting on the waiting list, sometimes for years, do in the meantime?
“A lot of them stay with family or friends. Some of them are homeless. Some of them struggle to find those decent, safe places to stay,” Petruzzello said. “It's tough for people.”