Community

The Louisville Metro Housing Authority is getting more than $460,000 in federal grant funding to help Section 8 and public housing residents become financially self-sufficient.

The annual grant from the U.S. Department of Housing and Urban Development funds the Family Self Sufficiency Program, which LMHA Director of Special Programs Dan Farrell said started in Louisville during the early 1990s. This year’s funding will pay the salaries of seven case managers who partner with qualified residents as part of the initiative. Case managers set goals with residents and coach them on job training, budgeting or whatever may help residents reach financial independence within five years. 

“It’s just always a pleasure to watch [residents] change and grow as they go through this program,” Farrell said. “It’s all due to our staff, which is funded by this grant, and the hard work they do of meeting each person where they find them and help[ing] them build on the strengths they already have.”

Another incentive is the program’s escrow account. Residents’ rent increases as they earn more money because public housing recipients are required to pay 30 percent of their income toward rent and utilities. But LMHA funnels that extra rent money into an escrow account, then awards it to residents who complete the program. Farrell said it’s a big draw for residents, who usually get an average of about $6,000 through the escrow account when they graduate. 

Louisville must serve 325 residents a year per HUD requirements, but LMHA does not formally track program graduates. A 2017 evaluation of similar programs in Massachusetts found that participants earned more over time and received less in cash welfare benefits than their peers.

But the program is difficult to complete. Only 11 percent of participants in Massachusetts’ program graduated between 2010 and 2015. Around 75 percent remained in the program through March 2016. Louisville’s program requires that participants remain in good standing with the housing authority, meet with their case managers each month, be employed at least one year, and earn at least $14,500 a year by the program’s end. Between 2014 and 2019, Farrell said an average of 40 percent of program participants graduated.

“It’s not an easy program to go through,” Farrell said. “There’s a lot of meetings. There’s a lot of work that has to be done, and making changes in one’s life is one of the hardest things anyone can do.”

Participants’ escrow money is put into LMHA reserves if they do not graduate. Farrell said HUD compensates for that by providing less financial support to Louisville’s housing authority according to how much escrow money they received. Those who fail before the five-year program ends can reapply in one year, and graduates who become financially dependent again can reapply in five years. Residents can apply at any month of the year.