The U.S. Department of Housing and Urban Development (HUD) funds rental housing assistance for low-income families through several programs, two of which are public housing and housing choice vouchers. Public housing provides government-managed rental housing for low-income, elderly, and disabled individuals and families. The housing choice voucher program, formerly known as Section 8, provides participants housing subsidies through tenant- or project-based vouchers. Tenant-based vouchers are issued to eligible recipients who then choose where they live. Project-based vouchers apply to specific privately owned rental units.
HUD uses two major funding streams to pay for public housing: operating funds for management and administration, and capital funds for modernization. The housing choice voucher program is funded annually through congressional appropriations. Existing vouchers are usually all renewed, and new vouchers are sometimes created to serve additional families. Funding is generally based on the number and cost of a public housing agency’s vouchers, but the exact distribution formula is sometimes modified during appropriations.
Other Federal Housing Assistance
In addition to public housing and housing choice vouchers, HUD funds various programs that provide subsidies to private developers and owners of rental housing in exchange for making a portion of their units affordable to low-income tenants. HUD also funds several smaller tenant-based rental assistance programs.
Other federal departments and agencies also fund housing programs. These include low-income housing tax credits, administered by the Internal Revenue Service, and the rural development program, administered by the U.S. Department of Agriculture.