The Department of Housing and Urban Development will now have to verify the income of public housing tenants in order to prevent millionaires from receiving subsidized rent from taxpayers.
The president signed the Housing Opportunity Through Modernization Act on Friday, which included an amendment offered by Rep. Vern Buchanan (R., Fla.) aimed at rooting our fraud in public housing, which cost taxpayers over $100 million alone in 2015.
The law now requires the federal agency to cross-check the incomes of individuals receiving housing subsidies with existing databases to ensure that wealthy individuals are not getting public assistance. Prior to the legislation, the government relied on tenants to self-report how much they make.
Because landlords and public housing authorities were not checking incomes, more than 25,000 families were able to live in subsidized apartments, even thought they earned too much to qualify. The fraud cost taxpayers $104.4 million last year, according to the agency’s inspector general.
The inspector general found numerous cases of the government giving low-income housing to millionaires, including an individual with $1.6 million in assets living in Oxford, Neb., for $300 a month.
"Public housing should be for those who need it the most, not individuals with six-figure incomes and millions of dollars in assets," Buchanan said. "This abuse of taxpayer dollars must be dealt with in an aggressive way. This bill helps ensure millionaires are not living in public housing on the American taxpayer’s dime."
The House of Representatives passed Buchanan’s amendment in February, and its language was included in a housing bill signed Friday. The legislation also created a special assistance program for Veterans within the agency.