Section 8 Rental Housing:

Merging Assistance Programs Has Benefits but Raises Implementation Issues

RCED-94-85: Published: May 27, 1994. Publicly Released: May 27, 1994.

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Pursuant to a congressional request, GAO reviewed whether the Department of Housing and Urban Development's (HUD) two rental housing subsidy programs should be combined, focusing on the: (1) benefits of a merger; (2) major program differences that would need reconciliation; (3) merger's effect on HUD budgeting and financial management; and (4) effort needed to merge the two programs.

GAO found that: (1) the housing subsidy certificate and voucher programs should be merged to reduce administrative burdens and costs; (2) private owners would need to meet only one set of requirements, and assisted households would be treated similarly under a single combined program; (3) budgetary savings from the merger are not likely, since savings would be directed to other HUD activities; (4) program differences that need to be reconciled include the basis for calculating rental subsidies, the shopper's incentive, and budget authority for contract amendments; (5) a merger of the two programs would not by itself improve the accuracy of HUD budget estimates or the programs' financial management; (6) improvements are more likely to come from ongoing HUD efforts to improve its information systems and internal controls and streamline budgeting and reporting requirements for housing agencies; (7) merging the two programs depends on what legislation Congress enacts and how HUD implements the legislation, but substantial efforts will be needed to persuade participants to switch to the merged program; and (8) HUD may have to administer three programs during the transitional period after the merger and will need sufficient numbers of trained and organized staff in place to ensure a smooth merger.

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