In 2014, Congress extended authority for HUD’s Family Self-Sufficiency (FSS) program to owners of Section 8 Project-Based Rental Assistance (PBRA) properties. Originally, Congress created the FSS program in 1990 to help housing assistance recipients increase their incomes and build their savings. Housing Choice Voucher (HCV) recipients contribute 30 percent of their income toward rent and utilities, with the voucher paying the remaining housing costs up to the public housing agency’s payment standard. Typically, as recipients’ incomes rise, so do the rents they must pay. The FSS program allows households whose incomes increase to place their additional rent contributions in a savings account for future use. The savings are accumulated and held in an account over a five-year period. If the tenant does not receive cash assistance and remains employed for one year, he can use these savings toward his financial goals.

Preservation of Affordable Housing (POAH) was one of the first private owners to take up this opportunity, partnering with Compass Working Capital (Compass), a nonprofit financial services organization that has developed and implemented a new financial capability model for the FSS program.

The report highlights the changes in employment, earnings, and debt since participants’ enrollment in the Compass-POAH FSS program. The percent of participants with full-time employment increased from 22 percent to 36 percent; the unemployment rate declined from 39 percent to 27 percent; the average annual earned income increased from $12,211 to $17,722; the average FICO credit score increased from 587 to 616; and the percent of participants with debt in collection declined from 69 percent to 59 percent.

A larger study by Abt Associates of a Compass-FSS program with public housing agencies in Massachusetts found similar results. The study compared Compass-FSS participants to non-participants. Compass-FSS participants had an average earnings increase of $6,305 more than if they had not participated in FSS and an average bad-debt decrease of $764 less than if they had not participated in the program. The share of FSS participants with bad debt decreased from 65 percent to 54 percent, while the share of non-participants with bad debt increased from 61 percent to 66 percent.

The report recommends that Congress make the FSS permanent for PBRA sites rather than extending authorizations for the program through annual appropriations. Permanent authorization would encourage more owners to opt in. The report also recommends Congress increase the amount of funding appropriated for FSS coordinators in public housing and Section 8 PBRA programs, allowing them to serve more households.