Understanding Public Housing and Housing Voucher Programs: A Guide for Developers and Community Stakeholders
What Is Public Housing?
Public housing is a federally funded program designed to provide safe, decent, and affordable rental housing for low-income individuals, families, the elderly, and persons with disabilities. Administered by local Public Housing Agencies (PHAs) under the oversight of the U.S. Department of Housing and Urban Development (HUD), public housing includes government-owned and -operated apartment communities. Residents typically pay no more than 30% of their adjusted income toward rent, with HUD subsidizing the rest.
While traditional public housing was historically concentrated in large developments, decades of reform have emphasized mixed-income strategies, housing choice, and the dispersal of affordable housing options across communities. In addition to operating public housing units, PHAs increasingly rely on voucher-based programs to expand affordable housing access in the private market.
Overview of Voucher Programs
Housing Choice Vouchers (HCV) — Section 8
The Housing Choice Voucher Program—commonly referred to as Section 8—is HUD’s largest tenant-based rental assistance program. Under this model, eligible low-income households receive a subsidy that they can use to rent privately owned housing. The PHA pays the difference between what the tenant can afford (typically 30% of income) and the market rent, up to a locally determined payment standard.
Key features:
Tenants can choose where to live, provided the unit meets HUD housing quality standards and rent reasonableness requirements.
Vouchers are portable so participants may move to another jurisdiction and keep their assistance, subject to certain conditions.
Landlords must agree to participate in the program and sign a Housing Assistance Payments (HAP) contract with the PHA.
Project-Based Vouchers (PBV)
The Project-Based Voucher program is a component of the Housing Choice Voucher program, but the subsidy is tied to a specific unit rather than a household. Tenants occupying a PBV unit pay 30% of their income toward rent, but if they move, the voucher does not move with them.
Key features:
Up to 20% (and, in some cases, an additional 10%) of a PHA’s voucher allocation can be project-based.
Units are placed under a long-term Housing Assistance Payments contract (typically 15–20 years), which guarantees rental income to property owners.
PBVs can be used in both new construction and existing housing and are often paired with Low-Income Housing Tax Credits (LIHTC) or other development incentives.
PBVs are a critical tool for place-based affordable housing strategies, allowing PHAs to deepen affordability in targeted developments or preserve existing affordable housing stock.
The PBV Allocation Process
PHAs select PBV units through a competitive Request for Proposals (RFP) or Request for Qualifications (RFQ) process unless the units are owned directly by the PHA or affiliated entities and meet HUD’s exemption criteria.
Step-by-Step PBV Issuance Process:
PHA Issues RFQ/RFP
The PHA announces the availability of PBVs, specifying eligibility criteria, unit types, geographic priorities, and other preferences (e.g., permanent supportive housing, proximity to transit, or income targeting).
Developer Submits Application
Developers respond with detailed qualifications, including site control documentation, financing plans, development timelines, and experience with affordable housing delivery.
PHA Reviews and Scores Applications
The PHA evaluates proposals based on published criteria, such as project readiness, alignment with community needs, and developer qualifications.
Selection and Environmental Review
Selected projects undergo a federally mandated Environmental Review before the execution of an Agreement to Enter into a Housing Assistance Payments contract (AHAP).
AHAP and Construction/Repair Period
For new construction or rehab, the AHAP outlines the construction period requirements and timing for unit delivery.
Execution of HAP Contract
After construction or rehab, units are inspected, and a Housing Assistance Payments (HAP) contract is executed. Tenants are then referred from the PHA’s waiting list or designated populations.
Best Practices for Responding to a PBV RFQ
Developers and nonprofits interested in securing PBVs should follow these best practices when responding to a public housing agency’s RFQ or RFP:
Understand Local Priorities
Each PHA may prioritize different goals—permanent supportive housing, housing for extremely low-income families, revitalization of targeted neighborhoods, etc. Carefully review the PHA’s administrative plan, strategic goals, and RFQ criteria to tailor your response.
Demonstrate Site Control and Readiness
Proposals with documented site control, completed zoning entitlements, or confirmed financing commitments are typically favored. Show that your project is “shovel ready” or well-positioned to proceed quickly.
Show Financial Feasibility
Submit a complete development budget, sources and uses statement, and pro forma demonstrating long-term viability. Highlight any commitments from LIHTC, HOME, or CDBG programs.
Emphasize Experience and Capacity
Provide evidence of your team’s experience with affordable housing, compliance with HUD or state agency requirements, and successful project delivery. Past PBV, LIHTC, or HUD-financed developments are particularly valuable.
Include Supportive Services if Required
If targeting special populations (e.g., formerly homeless individuals, seniors), describe the supportive services plan, including partner organizations, funding sources, and long-term sustainability.
Ensure Compliance with Fair Housing
Propose units in diverse neighborhoods to promote deconcentration of poverty and follow HUD’s Affirmatively Furthering Fair Housing (AFFH) requirements. Describe how your project advances equity and access to opportunity.
Communication after Voucher RFP is Issued
After an RFP for vouchers is issued and until the deadline for submission of proposals, interested parties may submit questions in writing to the PHA. All questions will be answered in writing and made available on the PHA’s website for all parties to access.
After the deadline for formal submission, the PHA will not communicate with any party until tentative selections for awards are made, except if the PHA requires additional information. During this period, submitting parties should avoid contacting the PHA board of commissioners, PHA staff or elected officials to influence the outcome of the PBV evaluation and selection process.
Conclusion
Public housing and the broader system of rental assistance, including Housing Choice and Project-Based Vouchers, are vital tools for expanding housing opportunity and combating housing instability. Project-Based Vouchers, in particular, serve as a bridge between public funding and private development, enabling the creation and preservation of deeply affordable housing in communities of choice. For developers and housing partners, responding effectively to a PHA’s PBV offering requires strategic alignment, organizational capacity, and a deep understanding of both the policy framework and local housing needs.
By investing time in understanding the process and preparing high-quality, tailored proposals, stakeholders can leverage PBVs to build inclusive, affordable communities that endure for generations.