National Housing Law Project Housing Law Bulletin

The Brooke Amendment Should Not Be Repealed

Congress has already imposed a minimum rent on all public housing and Section 8 tenants for the remainder of Fiscal Year 1996.² A bill reported to the floor of the House of Representatives, H.R. 2406, would allow public housing authorities (PHAs) to set the rents at whatever they determine to be appropriate for the unit and the family.³ It would allow PHAs to raise rents on tenants, even if the new rents would be higher than 30 percent of their income. Another bill, S. 1260, which the Senate approved on January 10, 1996, would do the same, except that tenants with incomes below 50 percent of area median income could not be charged more than 30 percent of their income for rent.⁴

The history of the Brooke Amendment, which is summarized below, demonstrates why the amendment is so vital and why it must not be repealed. We should learn from that history, not blindly repeat the mistakes of the past.

In 1969, the National Association of Housing and Redevelopment Officials (NAHRO), in its testimony before the Senate Subcommittee on Housing and Urban Affairs, brought to Congress' attention the fact that public housing could no longer continue to serve the lowest income families because of rapidly rising costs. To support that proposition, NAHRO attached to its prepared statement an article written by Albert A. Walsh, Chairman of the New York City Housing Authority. In that article, Mr. Walsh reflected on the fiscal crisis faced by his authority and many others like it. He made the point that public housing in 1969 faced two choices. It could continue forward with its existing structure of limited federal subsidies and ever escalating rents to cover increased operating costs. Or it could switch to a revised federal subsidy system that would keep the rents affordable and fill the gap between rents and costs with adequate federal operating subsidies.

Mr. Walsh advocated the latter choice for the following reasons:

If we choose to maintain the status quo, which I might characterize as selecting the fork in the road that leads to the right, I think that we will find that we have embarked on a disastrous detour that leads only to the total failure of the public housing program and eventual abandonment of the goals it has served so well over the past 30 years. Based on our experience in New York City, public housing dwelling units will soon be priced out of the low-income market and a social crisis of major proportions will develop as low-income tenants face the difficult choice of paying a catastrophic proportion of their income for rent — or returning to the slums.⁵

We face that same choice today. We can withhold adequate operating subsidies from PHAs and allow them to raise rents to cover the gap between the level of federal funding and the costs of operation. If we choose that option, now as in 1969, we will be embarking upon a disastrous detour that leads to the total failure of the public housing program. Now, as then, we will face a social crisis of major proportions as the lowest income tenants will be priced out of public housing by rents that consume catastrophic portions of their incomes. Unlike 1969, however, these families will not have the choice of returning to the slums, because there is now no housing on the private market that can serve them. Instead, they will become homeless.

In 1969, Congress chose Mr. Walsh's other fork in the road. It enacted the Brooke amendment which capped public housing tenants' rents at 25 percent of their income and made federal subsidies available to close the gap between tenants' rents and the costs of operation. In introducing the bill that contained his amendment, Senator Edward Brooke, Republican from Massachusetts, explained that minimum rents needed to pay operating costs were excluding "the very poorest and most needy of our citizens from participation in public housing projects."⁶ His bill, by capping rents at 25 percent of income and providing subsidies to cover the rest of the costs, would "insure that the Federal housing programs will at last begin to meet the requirements of our most needy citizens."⁷ It would overcome one of the two grossest impediments to better housing, "the inability of our poorest citizens to benefit from the units which are available."⁸

Senator Thomas J. McIntyre, Democrat of New Hampshire, co-sponsored the bill with Senator Brooke. When the bill was introduced, he explained the need for it as follows:

The crisis in public housing is reaching dramatic proportions. Public housing authorities across the Nation are no longer able to provide adequate maintenance and services for tenants and at the same time preserve the low-rent character of the projects. Even though the Housing Act of 1937, which established the public housing program, stated that the program would serve those "families in the lowest income group" local authorities have been forced to set minimum income requirements and raise rentals in order to meet the rising costs of maintenance and operation. As a result, more and more of the poor and very poor are barred from admission to public housing projects.⁹

The bill would correct that problem by providing operating subsidies and limiting tenants' rents to 25 percent of their income. As Senator McIntyre explained:

In this way, minimum rents would no longer be required by the local housing authority. Tenants with the very lowest incomes would be eligible for admission to public housing. It would also mean that tenants already living in public housing will not be spending a disproportionate amount of their incomes for shelter.

In addition, local housing authorities would receive adequate funds to maintain and operate the facilities and to provide needed services to tenants. It would no longer have to resort to the only method available, raising rents, to guarantee residents a decent place to live.¹⁰

When the bill was considered on the floor in September of 1969, Senator Brooke elaborated further on the need for the change. He stated:

Information available from HUD indicates that there are approximately 180,000 tenants in public housing projects who pay in excess of 25 percent of their income for such housing. This problem is further accentuated by inflationary pressures which are increasing operating costs considerably. Many public housing authorities, unable to obtain additional funds to cover these increased costs, are looking to public housing tenants for their source of additional funds. But these public housing tenants are unable, in many cases, to meet prior payment schedules without allocating a disproportionate share of their income to housing, and they find it impossible to do so as their rental payments increase still further.

We believe that no public housing tenant should pay more than 25 percent of their income for housing; however, we certainly would encourage public housing authorities to charge considerably less where it is economically feasible to do so.¹¹

No provision comparable to the Brooke Amendment had been included in the housing legislation passed by the House that year. However, in conference, the House receded to the Senate on this provision and included a modified version of the amendment in the conference report. On the floor of the House, Representative Leonor Sullivan, from St. Louis, led the supporters of this change. In light of the fiscal crisis then faced by the St. Louis Housing Authority, she forcefully made the case for the modified version of the amendment, as follows:

One of the most troublesome problems we confronted in the conference had to do with a Senate amendment dealing with public housing. The Senate had proposed adding $75 million to the annual subsidy for public housing to enable housing authorities with a high percentage of very low-income tenants to reduce rents to a level of 25 percent of income. The amendment was well-intentioned, because the poorest people in the projects were often required to pay the highest percentage of their income for housing — much more than welfare families in many jurisdictions could afford unless they received food stamps to enable them to eat a nearly adequate diet — and the food stamps are not yet available in every jurisdiction — these people had a "Hobson's choice" of either purchasing housing and very little else, or purchasing food and living in unimaginable slums.

It has been the policy of Congress for years that low-income tenants in public housing not be required to pay more than 20 percent of their income for shelter. But many housing authorities found it impossible to conform to this standard, particularly as more and more of their public housing families came from the lowest income levels — on welfare. Minimum rents in public housing in St. Louis and elsewhere eventually rose to a level of 50 percent or more of their total income. Even with food stamps, the welfare families in our public housing projects have found it impossible to approach a minimum standard of living for survival. Yet, despite the high rental levels which the housing authority had to impose in order to meet operating costs, the authority has been in serious financial jeopardy, heading toward bankruptcy. Finally, the authority acceded to community demands to reduce rents to the 25-percent level.¹²

The bill agreed upon by the conferees was passed by both the House and the Senate on December 12, 1969, and signed into law by President Nixon on December 24, 1969.

Today, as in 1969, we face the choice of whether to continue to guarantee our lowest income people access to public housing or to embark on a course that will fence them out. We can repeal the Brooke Amendment and, in Senator Brooke's words, "exclude the very poorest and most needy of our citizens from participation in public housing projects." We can revert to the system, described by Senator McIntyre, under which the PHAs were "forced to set minimum income requirements and raise rentals in order to meet the rising costs of maintenance and operation. As a result, more and more of the poor and very poor are barred from admission to public housing projects." We can go back to the situation described by Representative Sullivan, in which "[m]inimum rents in public housing in St. Louis and elsewhere eventually rose to a level of 50 percent or more of their total income. Even with food stamps, the welfare families in our public housing projects have found it impossible to approach the minimum standard of living for survival."¹³ We should not, however, repeat that history of misery and forced deprivation.

Another aspect of the history of the Brooke Amendment is of particular significance in this time when veneration for local discretion is once again in vogue. Prior to 1959, there was a federal policy that public housing rents not exceed 20 percent of tenants' incomes.¹⁴ In 1959, during a earlier era of high reverence for state and local decision-making, Congress enacted the "local autonomy amendment" to the United States Housing Act. That amendment vested in local public housing agencies "the maximum amount of responsibility in the administration of the low-rent-housing program, including responsibility for the establishment of rents and eligibility requirements. . . ."¹⁵

It was that local autonomy amendment that gave PHAs the freedom to raise tenants' rents when PHAs later encountered operating cost increases that outpaced increases in the tenants' income. But as Representative Florence P. Dwyer, Republican from New Jersey, explained when the Brooke Amendment was being considered in 1969:

Ten years ago, in 1959, when we revised that program [public housing] in the name of local autonomy, we had no intention of allowing local public housing authorities to charge higher and higher rents to the poor people as a means of avoiding bankruptcy. Yet, the much higher costs of today are no longer able to be financed out of rental income and in many cases public housing rents now greatly exceed tenants' ability to pay.¹⁶

As it was in 1959, it would be a mistake now to grant PHAs unrestricted freedom to raise rents in the name of deregulation or devolution. The only way the poorest among us are to be assured access to federally assisted housing is to limit their rents to a fair percentage of their incomes. The Brooke Amendment does that and thus should not be repealed.

The subsequent history of the Brooke Amendment also has a lesson for today. In 1974, when the entire United States Housing Act was being revised, concerns were raised that under the Brooke Amendment, some tenants were paying too little for rent. The committees considered various ways to get at that problem, and came up with a minimum rent set at 10 percent of gross income. They rejected other alternative minimum rents, set at flat levels or at a certain percent of operating costs. The reasons for rejecting those alternatives were explained in the House Report on the 1974 Act:

The bill requires each tenant in public housing to pay a minimum rent. This minimum rent would be 10 percent of the gross income of the tenant. The committee considered other ways of formulating a minimum rent, most notably as a percentage of unit operating costs. The committee rejected this approach as having too divergent an impact nationwide since operating costs vary in different projects and the lack of any relationship between operating costs and ability to pay would cause undue hardship to many tenants.¹⁷

In that same report, Representative Moakley, from Massachusetts, explained even more clearly the inequities of minimum rents that are unrelated to the tenants' ability to pay:

The concept of a minimum rent for occupants of low-rent housing is a regressive concept with which I cannot concur.

In view of pressure generated by numbers of the Committee for such a provision, I believe the approach of establishing a rent based upon 10% of gross income is far more equitable than other formulas that had been suggested. Specifically, establishing a rent based upon unit operating costs, which had been considered by the Committee, lacked any relationship to ability to pay and would have placed an undue burden on most tenants.
. . .
It is inconceivable to me that we would look to the residents of public housing, and to the poorest residents at that, for the additional revenue needed, rather than to the subsidy system already mandated by Congress.¹⁸

As in 1974, there is now much talk about a minimum rent in public housing. The Balanced Budget Downpayment Act¹⁹ imposed a mandatory minimum rent of $25 on all public housing and Section 8 tenants for the remainder of Fiscal Year 1996, regardless of the tenant's income.²⁰ It also granted PHAs the power to raise the minimum rent to as high as $50. There are other proposals for flat minimums, such as $100 per unit or $25 per bedroom. They produce the same inequity that the alternatives considered in 1974 created, i.e., they are not related to tenants' ability to pay and thus impose the harshest burden on those whose incomes are the lowest. Those kinds of minimums were rejected in 1974 for good reasons, and they should be rejected today for the same reasons. The 10-percent-of-gross-income minimum enacted in 1974, and still in the law today, should be retained, not replaced by an inequitable alternative. The $25 minimum in Public Law No. 104-99 should be repealed in the next appropriations bill or allowed to expire on September 30, 1996.

Another issue currently being raised is whether the percentage of income that tenants pay should be raised from 30 percent to some higher figure, such as 35 percent. Again, history is worth considering on this question. Up until 1959, the federal standard was 20 percent.²¹ In 1969, when the Brooke Amendment was enacted, the percentage became 25 percent. In 1979, Congress granted HUD the authority to raise the ratio to as high as 30 percent for families with incomes above 50 percent of area median income in the area.²² That legislation, however, grandfathered in all current tenants at the 25-percent level.²³ In 1981, the ratio was raised to 30 percent, and it was transformed into a mandatory rent for everyone, instead of a maximum that could not be exceeded.²⁴ That is where we stand today, with the exceptions of the newly enacted $25 minimum rent and the voucher program, under which tenants pay 30 percent of income plus whatever the landlord charges for rent above the PHA's payment standard. Often, for voucher holders, that works out to 40 and 50 percent of income.

This continuing creep in the amount tenants pay — from 20 percent in 1959, 25 percent in 1969, 30 percent for some in 1979 and for all in 1981, 30 percent or more for voucher holders in 1984, to the 35 percent or more that was proposed for all in 1995 — is regressive injustice, not progressive equity. Someone has to draw the line sometime or the federal housing programs will go the way that Albert Walsh predicted in 1969. They will have failed their intended mission of making decent housing available to people with low incomes.

Now is the time to stop this mindless return to policies that are unjust and inequitable, and that undermine the very programs established to serve this country's poorest households. H.R. 2406 should be amended on the floor of the House to restore the 30-percent-of-income cap that the Brooke Amendment places on rents. In any conference held to reconcile H.R. 2406 and S. 1260, the most favorable version for the tenants — either the provision in S. 1260 saving the Brooke Amendment for all tenants with incomes below 50 percent of area median, or an amended version of H.R. 2406, if that occurs, restoring the Brooke Amendment completely — should prevail. Either way, if this year's housing legislation reaches the President's desk containing a repeal of the Brooke Amendment, the President should veto it.

1. Pub. L. No. 91-152, 83 Stat. 379 (Dec. 24, 1969).
2. Pub. L. No. 104-99, § 402(a) (Jan. 26, 1996).
3. H.R. REP. NO. 461, 104th Cong., 2d Sess. 21 (Feb. 1, 1996) (H.R. 2406, § 225).
4. 142 CONG. REC. S152, S153 (Jan. 10, 1996).
5. Albert A. Walsh, Is Public Housing Headed for a Fiscal Crisis? 2 J. HOUS. (Feb. 1969), reprinted in Hearings Before the Subcommittee on Housing and Urban Affairs of the Senate Committee on Banking and Currency, 91st Cong., 1st Sess., at 202 (July 15, 17, 18, 21, 22 and 25, 1969).
6. 115 CONG. REC. 21,973 (Aug. 4, 1969).
7. Id.
8. Id.
9. Id.
10. Id. at 21,974.
11. 115 CONG. REC. 26,721-22 (Sept. 23, 1969).
12. 115 CONG. REC. 38,778 (Dec. 12, 1969).
13. Id.
14. CONF. REP. NO. 740, 91st Cong., 1st Sess., 1969 U.S.C.C.A.N. 1584 (Dec. 10, 1969).
15. Housing Act of 1959, § 501, Pub. L. No. 86-372, 73 Stat. 654, 680 (Sept. 23, 1959).
16. 115 CONG. REC. 38,778 (Dec. 12, 1969).
17. H.R. REP. NO. 1114, 93d Cong., 2d Sess. 373-74 (June 17, 1974).
18. Id., Supplemental Views, at 554-55.
19. Pub. L. No. 104-99, § 402(a) (Jan. 26, 1996).
20. For more information on this recent legislation, see Housing Availability Curtailed by Continuing Resolution; HUD Issues Implementing Guidance elsewhere in this issue.
21. CONF. REP. NO. 740, supra note 14.
22. Pub. L. No. 96-153, § 202(a), 93 Stat. 1106 (Dec. 21, 1979).
23. Id.
24. Pub. L. No. 97-35, § 322(a), 95 Stat. 400 (Aug. 13, 1981).