U.S. Lets Rich Get Cheap Public Housing: “Positive Social Benefits”

Tens of thousands of people who earn too much to qualify for the U.S. government’s taxpayer-subsidized public housing live in the facilities nationwide and the federal agency that runs the program has no intention of evicting the violators. That’s because “there are positive social benefits from having families with varying income levels residing in the same property,” according to the Obama administration official that runs the program.

Some beneficiaries earn tens of thousands of dollars a year more than the threshold allowed to qualify for the cheap housing and, in at least one case, a millionaire pays a mere $300 a month in rent for a public housing unit in Oxford, Nebraska. The tenant has an annual income of more than $65,000—which alone disqualifies her for public housing—and assets of nearly $1.6 million, including stock, real estate a handsome retirement account and a checking account with a balance of $334,637.

It’s inconceivable that the government allows this abuse to occur, but considering that it involves the Department of Housing and Urban Development (HUD) it’s not all that surprising. The scandal-plagued agency is well known for its many transgressions and for looking the other way in the face of fraud and corruption, even among its own employees. Just a few weeks ago Judicial Watch reported that a HUD employee fraudulently charged nearly $12,000 in personal items on his work-issued credit card and the agency failed to even reprimand the employee or report the wrongdoing after learning about it.

Now we have a similar situation in which HUD’s inspector general exposes wrongdoing and the agency simply refuses to take action. In a recently issued report the agency’s assigned watchdog reveals that more than 25,000 “overincome” people, including the Nebraska millionaire mentioned above, live in public housing. Nearly half of the overincome public housing tenants around the country earn $10,000 to $70,000 a year more than the limit to qualify for the benefit, the IG found. About 1,200 have exceeded the income max for around a decade and thousands of others for more than a year.

Examples in the report include a family of four in New York City with an annual income of nearly half a million dollars and hundreds of thousands more in rental income from real estate holdings that pays $1,574 a month to live in a government-subsidized apartment. In Los Angeles a family of five that’s lived in public housing for decades made over $200,000 last year and paid only $1,091 a month for a four-bedroom apartment. This is outrageous and violates a HUD rule that states public housing was established to provide decent and safe rental housing for eligible low-income families.

Auditors confirm in the report, which includes informative graphs, that HUD has no intention of taking action to stop the fraud: “We did not find that HUD and public housing authorities had taken or planned to take sufficient steps to reduce at least the egregious examples of over income families in public housing,” the IG report states. “Therefore, it is reasonable to expect the number of overincome families participating in the program to increase over time.” This is downright outrageous!

Indeed, a high-ranking agency official, Deputy Assistant Secretary of Public Housing Milan Ozdinec defends HUD’s policy allowing taxpayers to get fleeced. “There are positive social benefits from having families with varying income levels residing in the same property,” Ozdinec said in a written response to the probe. “Forcing families to leave public housing could impact their ability to maintain employment if they are not able to find suitable housing in the neighborhood. Further, for families with children, it may be more difficult to find affordable child care, and it may impact school-age children’s learning if they are forced to change schools during a school year.”

Just another day of outlaw business practices at HUD. Earlier this year JW reported that a HUD director who simultaneously ran a leftwing nonprofit changed agency policies to benefit her group. Her name is Debra Gross and for years she headed a crucial HUD policy office while she served as deputy director of a leftist organization called Council of Large Public Housing Authorities (CLPHA) that claims to work to “preserve and improve public and affordable housing through advocacy, research, policy analysis and public education.”

In 2011 a JW investigation found that the Obama administration violated the ban on federal funding for the Association of Community Organizations for Reform Now (ACORN) by giving the famously corrupt group tens of thousands of dollars in grants to “combat housing and lending discrimination.” The money, $79,819, flowed through HUD and clearly violated a law (Defund ACORN Act) passed by Congress in 2009 to stop the huge flow of taxpayer money that annually went to ACORN after a series of exposés about the leftwing group’s illegal activities.