Section 8 policy change

New voucher payment standards
effective April 1, 2007

What is a voucher payment standard (VPS)?
New payment standard amounts
When the change affects households
Changes in utility allowances

What is a voucher payment standard?

The voucher payment standard (VPS) defines the maximum subsidy amount that SHA will pay on behalf of a family. Every year the U.S. Department of Housing and Urban Development (HUD) establishes a “Fair Market Rent” (FMR) for each bedroom size in a particular market area, and housing authorities set their payment standards between 90 percent and 110 percent of HUD’s FMR. SHA’s payment standards are based on HUD’s determination of Fair Market Rents (FMRs) for King, Snohomish and Island counties, which SHA adjusts for the Seattle rental market.

New voucher payment standard amounts

The chart below shows the old and the new payment standards as of April 1, 2007.

No. of Bedrooms	Studio	1	2	3	4	5	6
Old standards	$642	$762	$917	$1293	$1550	$1697	$1952
New standards (effective 4-1-2007)	$695	$781	$1005	$1395	$1621	$1865	$2108

How do payment standards affect what tenants will pay?

Payment standards have two components: a subsidy amount for rent and a subsidy amount for tenant-paid utilities (called a utility allowance).

If a family finds a unit where the rent plus the utility allowance is equal to or lower than the payment standard, the family will pay only 30 percent of their income for rent and utilities.

If rent plus utilities exceeds the voucher payment standard amount, the family can make up the difference as long as they do not pay over 40 percent of their income for the first year of the lease.

After the first year, tenants can choose to pay more than 40 percent of their income if the landlord raises the rent and they do not want to move.

When will the change will affect households?

Starting April 1, 2007, the new payment standards were made effective for all new families receiving vouchers and all families that move with a voucher from one unit to another.

All other affected participants were to be notified at their next annual review that they may be eligible to receive additional subsidy (starting August 1, 2007).

Changes in utility allowances

The utility allowance is an estimated cost for tenant-paid utilities and is based on the type of energy the rental unit uses, the number of bedrooms in the unit, and the type of building (e.g., apartment or house). This chart shows all the possible variations of utility allowance amounts that SHA currently uses.

For any given payment standard, the lower the utility allowance, the more subsidy is available for rent. Currently, SHA’s utility allowance amounts are based on HUD’s 1981 national consumption data, which averages winter heating costs for Maine households and summer air conditioning costs for Florida households.

SHA is now reviewing utility allowances with a professional energy consultant, to ensure that they are reasonable given our temperate Puget Sound climate. Voucher holders can expect changes in the allowances.