Episode 96: Direct-to-Tenant Rent Assistance with Vincent Reina

Shane Phillips 0:00
Hello, this is the UCLA Housing Voice podcast, and I'm your host, Shane Phillips. This week, we're joined by Vincent Reina to share findings from the study of a new approach to delivering rent assistance to low-income tenants. The pilot program, operating out of Philadelphia, compares outcomes for tenants who receive direct cash assistance to those receiving traditional housing vouchers, as well as eligible households who don't receive any financial assistance. As we've talked about in episodes from late 2024 and early 2025, housing vouchers provide critical assistance to low-income renters in the U.S., but many end up going unused. One big reason why is the difficulty of finding a landlord who accepts vouchers. A problem that could be solved, the thinking goes, if tenants don't have to use a voucher to pay at all. With cash deposited into their bank accounts instead, recipients may be less stigmatized and gain more autonomy in deciding where to live and how they want to balance housing cost, location, and quality. Two years into the pilot, the results are promising. Evictions and homelessness are down, and while tenants who receive housing vouchers end up with fewer housing quality concerns than those who received cash, both groups see big improvements over those who got neither. And as Vincent emphasizes, the study is also a great illustration of how academics and local governments can partner to test reforms that can later be scaled up, and it's a model for research that's both methodologically sound and sensitive to the needs and experiences of its subjects. I neglected to name Vincent's co-authors at the start of the interview, so allow me to fix that now. The Cityscape article from earlier this year was authored by Vincent, Matthew Fowle, Sarah Jaffee, Rachel Mulbry, and Miranda Fortenberry, and the report on outcomes two years into the pilot program includes all those already mentioned, plus Mimi Tanski. The Housing Voice Podcast is a production of the UCLA Lewis Center for Regional Policy Studies with production support from Claudia Bustamante, Brett Berndt, and Tiffany Lu. Send your questions and feedback to shanephilips@ucla.edu, tell your friends and colleagues about us, and urban planners, remember that you can get AICP credit for listening. With that, let's get to our conversation with Vincent Reina.

Shane Phillips 2:39
Vincent Reina is a professor in the Department of City and Regional Planning at the University of Pennsylvania, among many other titles, and was a senior advisor on housing and urban policy with the White House Domestic Policy Council under President Biden. And he's here to share his research on an alternative approach to delivering rent assistance to low-income households, one that provides cash directly to tenants instead of landlords. Vincent, thanks for joining us and welcome to the Housing Voice Podcast.

Vincent Reina 3:07
Thank you for having me.

Shane Phillips 3:09
And my co-host today is Mike Lens Hey, Mike.

Michael Lens 3:10
Hello, Shane. Hello, Vincent. Great to be here.

Shane Phillips 3:14
As always, we start off each episode asking our guests for a tour of a place they know well. So where are you telling us about today, Vincent?

Vincent Reina 3:20
So I'm going to tell you about the wonderful city of Philadelphia, which I know Mike recently visited and hopefully, Shane, you'll come out this way soon if you haven't been here recently.

Shane Phillips 3:29
I've never been. I'm embarrassed to say somehow I do want to visit. I guess now is not the time of year, but hopefully it won't be too long.

Vincent Reina 3:38
Fall in Philadelphia is absolutely wonderful. So I live in a neighborhood called Queen Village, which is a very centrally located neighborhood within Philadelphia. And I actually walked to work because in my research lab, we rent space from the Federal Reserve Bank of Philadelphia. Funny enough, they sublet out space and we were fortunate to be able to lease some of that space. So my walk starts in Queen Village, right? And interestingly enough, one of the first things you do when you leave Queen Village is you cross the street called South Street. You might have heard about cruising on South Street from Boyz II Men songs.

Michael Lens 4:11
Ooh.

Vincent Reina 4:12
There you go.

Michael Lens 4:14
The Motown Philly song. Yeah. I got that lyric right there.

Vincent Reina 4:17
There you go. There you go. And what's interesting about South Street, right, is it was supposed to be an east-west highway that was going across the city and the neighborhoods actually actively fought against it. And during this time, property values all around what was going to be a highway essentially went from low to essentially near zero, right? So my home was bought by the prior owner for a dollar because no one wanted to live by a highway construction site, no less by a major highway when it was done. And so kind of really interesting to think about the street you cross and I cross all the time that could have and was going to be a highway. But as of 1974, I got taken off the docket and they actually moved it a bit further north. Funny enough to where I am right now, right by the Federal Reserve Bank of Philadelphia. But all to say is this kind of major housing transportation nexus and the history that could have been very different is just a little a stone's throw from my house, right?

Shane Phillips 5:17
Did they ever do any demolition before that freeway? I'm thinking of, Mike, you know, through Beverly Hills on, I can't remember, Santa Monica Boulevard or somewhere where there's like a linear park that's just right next to the street. And that was, as I understand it, because they had done a bunch of demolition in preparation for a freeway that was ultimately blocked.

Michael Lens 5:36
Yeah, that's Santa Monica Boulevard.

Vincent Reina 5:37
Yeah, not that I know of. This is where some of my historian professor colleagues would be much more-

Shane Phillips 5:44
They didn't get that far.

Michael Lens 5:45
Yeah.

Vincent Reina 5:47
But yeah, so I mean, it's pretty amazing. And then I just crossed from there and walked through Society Hill, which is like the oldest kind of most beautiful part of Philadelphia, pass by the Liberty Bell and all of those very historic landmarks along the way. To me, it's really kind of cool to be in the center of a big city, right, where you can have this historic row house neighborhood, you know, and you walk straight up through so much history to work every day. And to me, that feels like a very kind of Philly reality. Or at least the reality that I'm fortunate to live.

Michael Lens 6:19
Yeah. I recently had the red carpet treatment in Queens Village, of course, hanging out at Vincent's house. You know, I feel that part of my red carpet experience, of course, was hanging out with your family and specifically your young girls who are like working on a Ph.D. in hugs. I mean, they are they just, you know, in the middle of conversation, just get up and hug you. And it's, oh, wow, you're so nice.

Vincent Reina 6:49
You're exceptionally huggable, Mike. That's the...

Michael Lens 6:53
OK. Well, not everybody would say that. Not even my own family finds me all that huggable these days, but that's having teenagers, I think.

Shane Phillips 7:01
All right. So this time we are talking about a couple of publications by Vincent and his colleagues at Penn and the Philadelphia Housing Development Corporation. The first is an article from 2024 in Cityscape titled The Future of Rental Assistance, Lessons Learned from Implementing and Evaluating a Direct to Tenant Cash Assistance Program, PHL Housing Plus. So that one explains your motivations for studying this program, which is an alternative to the housing choice or Section 8 voucher program, and then lessons from the setting up of the evaluation study, not really the study itself. The second publication is coming out in mid-July, a little bit after we're recording this episode, and it reports on the trial's outcomes two years in, which we got a preview of before this interview. That publication is titled PHL Housing Plus, A Randomized Controlled Trial of a Cash-Based Alternative to the Housing Choice Voucher Program in Philadelphia, PA, telling us exactly what this is about.

Vincent Reina 8:02
You're kind of convincing me here we need to workshop our titles a little. So maybe at the end we could play with that a little.

Shane Phillips 8:08
I don't know. I mean, I appreciate a title that just tells you exactly what it is. There's no guessing what's going on here.

Michael Lens 8:14
No puns. We're just getting right to it.

Shane Phillips 8:18
Mike Manville would love it. So we have talked about housing vouchers quite a few times now on Housing Voice, which should not be surprising given that our show's name is an allusion to that very program. Episodes 17, 87, and 88 are all focused squarely on vouchers, and they're a key part of conversations with Beth Shin, Andrew Fenelon, and a few others. So we will not spend much time on background in this episode, I don't think. Keeping it fairly brief, I'll just say that vouchers are the main way we provide rent assistance to low-income households in the United States. And if I have read the HUD dashboard a couple of days ago correctly, it serves more than 2.3 million households and costs around $25 to $30 billion a year in its current form. Recipients can use their vouchers to rent housing on the private market, paying no more than 30% of their household income with the government picking up the difference up to a maximum rent level. Vouchers are a pretty well-regarded means of providing assistance to renters, just broadly speaking internationally, I think. But as our previous conversations make clear, the housing choice voucher program is not without its shortcomings, and that includes insufficient funding for sure, poor performance helping people move into higher opportunity neighborhoods in many cases, and fairly low rates of successful lease up, especially in more expensive markets with fewer vacancies. Using these vouchers requires landlords to accept them as a form of payment, making it a fairly unique kind of public benefit. And there are various reasons that landlords might be inclined not to accept them, many of which we talked about in episode 87 with Sarah Strochak. There is a hope that if we could skip that step and just give renters the money directly, then we could eliminate a lot of the friction in the current system and improve outcomes in a bunch of different ways. That is the theory, and it's what we're going to talk about today, along with what Vincent and his team found when they actually tested it out in the real world. So here's where I will turn it back over to you, Vincent. I would like to start by having you give us more of the background and motivation behind this direct-to-tenant rental assistance pilot. And I think Philadelphia's experience with the Emergency Rental Assistance Program, or ERAP, may be a good entry point. This is kind of how you open your cityscape article. ERAP was the federal program that helped people with rent in the wake of the COVID-19 pandemic, sending tens of billions of dollars out across the country. So tell us a bit more about some of the challenges implementing it in Philly and how this effort to provide short-term or one-time assistance to tenants in this emergency context led to an interest in changing the Housing Choice Voucher Program, which serves a quite different purpose than ERAP and is a much more stable program, at least for now.

Vincent Reina 11:06
Yeah. So thank you for that, Shane. And I'm going to actually take one step back because the fun thing about doing something like this is I get to blab away until you cut me off about things that I can't put in papers, right? And so –

Shane Phillips 11:17
We can always edit out, so –

Vincent Reina 11:21
Fair enough, fair enough. So interestingly enough, the idea for PHL Housing Plus came out before ERAP because I was very fortunate to have this fellowship that embedded me part-time with the City of Philadelphia, where I was working with the city to help think through housing solutions, right? And I had just worked with them to develop the first-ever citywide housing plan. The city wanted to do big, bold things and try new things, acknowledging that in a city with limited resources, they often couldn't fund the whole solution to a problem, but they could create the inroads for new solutions that we haven't tried thus far that hopefully can expand resources down the road. So with that context in mind, I had actually been working with a colleague at the Center for Guaranteed Income here, Amy Castro, to design for the City of Philadelphia essentially a cash assistance program that was going to be a thousand-person randomized controlled trial for the city that the city was actually going to fund through their city budget, right? And so we spent a whole year developing this program, the concept of it. We're talking through talking points. The mayor actually put it in his budget proposal at that time, Mayor Kenney. And then lo and behold, a week later, the city shut down because of the COVID-19 pandemic. So here we had like a $35 million locally funded thousand-person randomized controlled trial of this really interesting, innovative approach to housing assistance. And we got the rug pulled out from under us as everyone across the country did during that time, right? Enter ERAP, right? So the emergency rental assistance program, clearly something very different, responding to a pandemic meant to provide emergency relief. But one of the things that happened was because I was working so closely with the city, quickly pivoted to help them think about this program, right? And one of the things that became very apparent from this program in Philly, and Philly was in some ways the first mover in that some people were kind of developing their programs on day one, others weighed a little bit to see what funding rules said, all these kinds of things. But one thing that was very clear is you had to get money out the door very quickly. And you had to deliver rental assistance through whole new systems that often didn't exist for a city, right? Because as you know, well, public housing authorities administer the housing voucher program, not cities themselves. But then beyond that, you need to make sure it got into people's hands, essentially, no matter what, right? And not no matter what with no strings attached at all, but a big no matter what was regardless potentially of whether an owner wanted to receive the rental assistance or not, right? One of the early challenges faced by eRAP programs was one highlighting the fact that oftentimes cities don't have relationships with a lot of property owners, there's not easy mechanisms for them to reach them. There's a lot of reasons why owners are just stressful of cities, right? And so all to say is, enter that landscape where you're trying to get money to tenants through them very, very quickly, you can get into a lot of frictions, right? And so the city of Philadelphia realized off the bat, even with limited resources, that they were having a really hard time getting eRAP funds into the hands of tenants who are applying for the assistance. Some of these tenants didn't know who their owner was, some of the process of getting owner consent was arduous. And sometimes it worked out well, but a lot of times it actually didn't. So acknowledging that the city of Philadelphia was actually one of the first to quickly pivot to say, hey, can we actually offer these funds directly to the tenant, right?

Shane Phillips 14:50
Just as a tangent, do you know the reason that a landlord would not make it as easy as possible for the tenant to get these eRAP funds? I'm sure there's good reasons, but it just seems like, why would they turn down this money?

Vincent Reina 15:07
Well, yeah, in the city of Philadelphia, where essentially less than half of our properties are actually even registered with the city, right? There's already kind of like a lack of initial engagement. In some ways, because of politics of the past, the legitimate skepticism of the city government and I think there was a lot of fear at first that what would these funds actually mean for some of those owners, right? Was just funds during the pandemic to give to folks to solve current rent arrears or was this going to come with other obligations? Early emergency rental assistance programs tried to often tie on things like you can't evict someone for a certain period of time, all these other kinds of qualifications.

Shane Phillips 15:45
If I accept this money, then am I now obligated to not evict this person until this emergency is over? Even though that generally was true, regardless, I think, but I can see how you could jump to conclusions about other things being required that you don't even know yet.

Vincent Reina 16:02
That's exactly right. Yeah. So it kind of opens up a potential Pandora's box for some folks who already kind of shell shocked as we all were in the beginning of the pandemic and trying to figure out what's going on and created a real moment of friction. So worked with the city of Philadelphia very quickly to pivot and at that time, Paul Williams had also been testing this out when he was with the city of Chicago, were essentially the first two places to say, hey, we think we actually have the authority to give the money directly to tenants if an owner does not agree to enter the program, right? So in doing that, it laid a lot of the kind of groundwork and thinking of what could a direct attendant program actually look like. As my center, we then actually worked with the city of Los Angeles on this very policy as well. They were, I think, possibly the third and by far the largest city to initially move to this direct attendant option because they were facing this challenge. As you know well, Maxine Waters, who was one of the big champions of a lot of the emergency relief funds going around housing and helped construct a lot of those programs, quickly saw the challenges that LA was facing and leaned into a lot of the ways to make this program more efficient throughout the whole life of that program, but not the least of which was early on with exploring, hey, could we do this direct attendant model, right? Which in many ways was actually never really done or was only done once before the voucher program was created at a national scale and so really pushed against a lot of priors that we all have around housing assistance that we think is actually based on evidence. What's interesting is in building the case for the initial pilot before the ERAP came in and then talking about ERAP, you realize there's actually little empirical evidence at all testing this kind of direct attendant option. It opened up kind of a world of opportunities that allowed us to pivot and then raise some private capital through philanthropy. The city put in some of their own flexible money and essentially develop a smaller pilot that we ultimately launched in 2022.

Michael Lens 18:01
Cool.

Shane Phillips 18:03
Yeah, I wonder if LA's rental registry helped with that distribution here locally because we established that only for our rent stabilized housing stock, but that's the majority of multifamily housing and maybe the majority of all rentals in the city and that was back in 2017 or so and I know not all landlords are registered still, which is crazy to me, but hundreds of thousands of them are and so there is some, it's not even as I understand it, it doesn't provide direct information about the tenants, but it's a level of knowledge about ownership and which units are leased up and even like the rent they're paying and things like that that most cities just have no insight into directly.

Vincent Reina 18:48
Oh, absolutely. And then you just have like a lot of noise of different policies going on. So we actually did a survey of LA owners at that time. I know we're not talking about ERAP, but I'll just kind of do this one quick and one thing that became clear is that there were local ordinances being passed around evictions in LA that were independent actually of the rental assistance program, but it's really confusing for folks because government's government, right? And so there was actually the strong misconception that a lot of the local ordinances were actually tied to the emergency rental assistance funds, which they weren't, they were coterminous, right? So it's almost like you were better to accept the funds because you were subject to these rules anyway, but naturally it was easy for folks to feel confused about what was actually pushing the regulations on them in different forms. And so I think for LA, while they had this great registry and in many ways actually had a lot of really interesting engagement with owner groups and everything else, there was clearly a lot of broader policy making going on at the city level and the state level that made it hard for people to discern where the regulations were really being, were coming from at the time.

Shane Phillips 19:52
Yeah. In the first article, you say how you were hoping to test three outcomes in this trial or three kind of categories of outcome. And I think reviewing them first will be a good way of explaining the motivations for trying out direct to tenant rental assistance, a little bit more of the frictions that you mentioned. We'll get into program design later, but for now listeners can just think of direct to tenant rent assistance as simply taking whatever amount the voucher would have paid to a landlord and instead depositing that into a bank account or in this case, I think a preloaded debit card for the tenant each month. We'll go through each of these sets of outcomes one at a time and we'll start with reduced administrative burden. You talk about burden from the perspectives of three different groups, tenants, landlords, and public housing authorities. What are those burdens and how do we think that direct cash assistance might reduce or even eliminate them?

Vincent Reina 20:45
Yeah. All the stuff here I imagine is going to reiterate stuff some folks have said in the past. We know that for tenants, aside from the whole process of applying for vouchers and waiting a long time and being called off the wait list, which is a very long arduous process, once you're actually offered a voucher, there's significant paperwork that needs to be done to actually get you through the process. One of the things you have to do then is go on a private market and find an owner who will accept this form of rental assistance. Some owners might not know what a Section 8 voucher is, so there's the burden of educating folks what this thing is and how you can use it. Some owners do and have preconceived notions of what the actual program is or isn't, legitimate or illegitimate. With that too, though, for a tenant, even once you maybe find a unit that will accept your voucher, you then have to actually get your unit inspected through a formal inspection process. What that does is actually increases time and friction for me actually being able to use the voucher and move into the unit. It also means there's a scenario where that unit could fail and now, I actually have to go look for another unit, maybe possibly while I'm on the verge of homelessness and really housing unstable in this moment. What you realize in the normal voucher program, aside from a lot of paperwork, there's ultimately a lot of process that actually leads to – that ultimately gets to someone to leasing up a unit that gets to that scenario where we get to that 60% number nationally, right? 40% of people who are finally offered a voucher are not able to actually rent a unit with it. We looked at that in LA and that number is even dramatically lower, right? It's 56% for once offered a voucher, but if you go even before that phase, it's dramatically lower than that. All to say that the tenants facing all these frictions when all they're trying to do is use the benefit that they're being offered because ultimately, they can't use it unless an owner says yes. They say yes, they're not just receiving it, but all the structure of the program that HUD has around it as well, right? In this project, we realized very quickly that there's been actually little experimenting on how much of that process actually leads to better outcomes for folks with respect to not just finding a unit, but also the quality of the unit, where it is, all that kind of stuff. Similarly, for an owner, right? I was just looking to rent my unit, someone approached me with a voucher. This potentially could be a good thing because a portion of it is coming from the federal government, so that's actually kind of a guaranteed or more guaranteed payment stream and I could view it positively that way, but at the same time, there's a lot of set structures and rules that I have to adhere to to actually join this program and have you in it. Once you're in it, there's a lot of regulatory structures about engaging with voucher households. They're fairly straightforward, but when we think of the fact that the idea of renter protections are actually pretty minimal or nonexistent in many markets, you have a program that has even some slight very rational protections and it becomes a layer of burden for an owner who has a counterfactual of another tenant who doesn't come with any of these restrictions or rules, right? Beyond that, there's a housing authority that's going through this long process of calling people off waiting lists, getting people to come in, fill out paperwork, making sure all the paperwork is correct, bringing people through that inspection process, going through the whole leasing process, going through all these recertifications along the way, right? On all three dimensions, you have folks essentially being exposed to a set of process that's just a function of trying to bridge this contract between owner, tenant, and government, right? Whereas normally, the relationship is just owner and tenant. In that, it creates a lot not just time but cost for all the parties involved and leads to a lot of scenarios where there's kind of failed cases of someone being able to lease a unit with the voucher that's suboptimal for the tenant, for the housing authority that has to go through this whole paperwork process with them again, but then also potentially for that owner who then is still looking for someone to actually lease their unit.

Michael Lens 24:50
And this is all fairly paternalistic in a way as well, right? And I think there are costs and benefits or trade-offs to kind of paternalistic policies like this, right? But specifically, we don't give the money to the tenant, right? That payment goes directly to the landlord. And so, we're very clearly specifying what the money can and cannot be used for. And then we don't trust them to find a decent home or what we kind of provide our own standards as governments and housing authorities for the unit by inspecting the unit above and beyond what the tenant inspects, right? So, there's good and bad reasons for these things to be embedded in the voucher program. But it's just kind of worth thinking about like why we don't trust people with the money and with the decision-making process, right?

Vincent Reina 25:47
Right. And it also makes a lot of assumptions about like the way the housing market works, right? Some people pay their rent in installments, not at the first of the month. There's kind of a lot of income volatility over the course of a month that someone can't smooth with the voucher, right? There's a lot of informality in our housing market with respects to lease structures, living arrangements, right? Voucher program has very strong rules about what a household is and whose income counts towards that household income and a lot of other factors like that, right? That actually don't map on often to the way the housing market works for a lot of folks, but particularly for low-income folks in the rental market.

Shane Phillips 26:28
This is veering into current events and current policy proposals, but I think there is a proposal in the Republican House bill or something along those lines. Maybe it's just by the presidential administration to limit vouchers to only a two-year term and once you've used that, you're done. And I think there's obvious reasons why that would be disastrous for a lot of people, but something I actually hadn't thought about is from the perspective of a landlord, if you know that this is only in the last two years and then you're gonna have to find a new tenant again because there's a good chance they're gonna have to move out, that's just one more reason actually not to accept vouchers and could really lower the lease-up rates even more.

Vincent Reina 27:15
Yeah, we can have a whole episode on the arbitrary two years and why that's a really inefficient setup, but I agree that's another important kind of cost and these are transaction costs for folks, right, that people actually think about and account for when making decisions about where to live and who to lease to.

Shane Phillips 27:31
So that's the rationale for why direct-to-tenant assistance might reduce administrative burdens for all these different groups. Next up is its potential to improve lease-up rates and tenant choice in housing options and I feel like we're already sort of getting here. What are the problems with vouchers here and how might direct assistance help?

Vincent Reina 27:50
Yeah, so here, you know, as kind of alluded to already, we know that a lot of folks can't use their voucher and to jump ahead to one of our findings, right, if you're giving them money directly to the tenant, the odds of getting to 100% use rate is a lot higher. And so, there's a reality of taking out that kind of middle ground of having to negotiate a contract actually increases someone's ability to find housing and lease housing with assistance that they're providing, right? So I think one of the challenges and the travesties of this voucher program right now aside from it being dramatically underfunded and tons of research has shown fortified households for everyone who actually uses one is that, you know, a lot of folks when offered one can't use it. And for those folks who can't use it, their counterfactual is quite dire, right, in the trade-offs that they actually make. So all to say is that when we think of our like 60% use rate for the voucher program nationally, it's not just a problem of, you know, the program doesn't work for everyone. It's that who it doesn't work for, those folks are really worse off as a result of it. So all to say is that this cash program could actually help with lease up and that it's essentially, again, reducing that administrative burden and giving more agency to the tenant in actually finding the unit and flexibility even of what that unit looks like. And by virtue of doing that, it opens up their choice set, right? So in our model right now, there's no inspection requirement for this program in order to lease up your unit. And so that means that a household is making a decision about unit quality, unit location in a way that you or I normally do, right? I live in Philadelphia where there's no such thing as a proactive housing inspection. So my housing inspection, when I go rent a unit is me going to rent that unit and deciding that it's a good enough quality relative to all the other things I'm looking for in that housing unit. So all to say is that it kind of gives more agency to the tenant to find a unit that matches their needs and to be able to then successfully lease up the unit with the subsidy that's trying to get them into housing.

Shane Phillips 29:56
And the last thing you're interested in was greater flexibility and the ways that might lead to better housing outcomes. Tell us how traditional vouchers can end up restricting recipients options and how cash assistance might open up more of them. I was particularly interested in how direct assistance could help tenants stay in their current homes, which was something that also came up in our conversation with Sarah Strochak. And I think it feels underappreciated as a common use of vouchers. It certainly was by me. Maybe just because so much voucher research focuses on moving to opportunity rather than staying in place.

Vincent Reina 30:29
Yep, exactly. So there's an interesting, that's a great point, right? We've focused rightfully on the idea of ensuring neighborhood access and what that can mean for someone's kind of economic mobility and growth and wellbeing. But a lot of times a stable housing situation could be the best thing for someone's economic wellbeing and mobility. And so this idea, right, that for a lot of tenants who are offered a voucher, they might not actually be able to lease their current unit they're living in and would therefore have to move is a real challenging one for that individual, right? Because there's a cost of moving, right? There's social costs, there's financial costs. You have to have another unit you'd actually move to. But then beyond that, even if you rent your current unit or your future one with the voucher, again, kind of coming back to a point I hit on slightly, my income might come in gradually over the course of a month, right? I could get paid daily. I could get paid weekly. I could get paid biweekly, right? Sometimes we have income shocks that come up in a week this week that I didn't expect, but I can recover from it next week. When I have something like cash assistance, I have the autonomy of that flexible dollars in my pocket where I know I'm going to pay rent and I'm budgeting for my rent and maybe that rent actually isn't all due on the first of the month. Maybe actually I'd pay my rent in installments because my income flows that way. But then I could trade off across my income and expenses to ensure my rent is paid and I'm able to cover other things that all don't flow in the kind of same way that rent flows. So if I have to spend all my money on rent on the first of the month, right? And then I have nothing for the next two weeks, what happens to my other two weeks of expenses? So the cash model allows someone to essentially budget and to budget their dollars and to acknowledge the fact that housing is our largest consumption good, but it's not our only. And we often have income coming in through various forms, particularly for low-income households that then allows me to essentially smooth my housing consumption and smooth my other consumption that could really improve not just my housing outcomes, but a broader set of outcomes, right? I can afford to actually pay for the daycare this way. I can not take out a loan to act as a bridge towards certain costs, right? That I know I have every single month. And that's a real level of financial autonomy that's desirable, right? From an economic perspective for individuals, but also societally for the way we want people to budget money and the way we essentially do budget money.

Michael Lens 32:54
I was at the Wu-Tang concert a week ago, almost exactly one week ago.

Shane Phillips 33:30 Great transition.

Michael Lens 33:02 And as everybody listening knows, cash rules everything around me, right? Cream. That's – the Wu-Tang taught us that. Economists teach us that. Vincent just taught you that. This is what we do. Cash rules everything around.

Shane Phillips 33:19
Well, and I mean, and back to your paternalism comment too, I think there's this, you know, this comes back to essentially not trusting people to budget for themselves, but speaking as someone who makes a lot more money now than I did 15 years ago, I was budgeting much more carefully when I was younger and poorer than I am today. And so this idea that, you know, poor people don't know how to budget, like they're more experienced at it than anyone. Okay. So I think we can start getting into the evaluation itself. As I mentioned earlier, this was a randomized controlled trial, right in the title of the paper, which is described as the gold standard of experimental design, a phrase we've used probably literally every episode that RCTs have come up on this show. And I think every researcher says gold standard whenever RCTs come up and you have to explain it to non-researchers. These kinds of trials allow researchers to make plausible claims about causality. So for example, if your RCT was designed well, and you found that tenants who received direct cash assistance ended up in lower poverty neighborhoods or with less evictions on average than those receiving vouchers or not receiving anything, then it's likely that the direct assistance program was responsible for that outcome and you can make that claim. Give us a quick overview of how you selected the different groups in this RCT randomized controlled trial and the kind of intervention or treatment that each group received.

Vincent Reina 34:50
Yeah. And I want to thank you, one for promoting the potential benefits of RCTs, right. But also to like, just use that to reiterate that this was very much a learning opportunity, right? We developed a pilot to learn. This wasn't the creation of a permanent program, it was the acknowledgement that there were so many priors set up in our current way of providing housing assistance that we've never tested or learned from that we really should learn from this, which is why the idea of designing this program, both as a pilot, but then one that followed a randomized control trial kind of format was really important for the city itself. And I can't speak highly enough to the city and its leadership for acknowledging that, right? It's something that every city is jumping to do because it requires a lot of thought and process on the front end about how you're actually enrolling people and a commitment throughout the whole thing. I mean, we're so such good partners with the city in that way and they've made a lot of decisions to ensure we can actually study and measure this.

Shane Phillips 35:50
And so there's a risk to there of like, you know, what if the results are not as you hope and then the city kind of has to, they're going to take some responsibility for that rightly or wrongly. And so there's, there's a risk there as well. But I do think you're talking about, I think it was $70 million or so total. Is that, is that right?

Vincent Reina 36:08
Originally the pilot was going to be $35 million. It's much less than that now that we've, yeah.

Shane Phillips 36:12
So let's say, you know, in the tens of millions of dollars to potentially influence a program that, as I said, spends $25 plus billion a year nationally. And I think this would probably not be the first program to potentially influence the housing choice voucher program over its long tenure. But please continue.

Vincent Reina 36:33
Yeah. So one of the things we knew is we were trying to first kind of figure out how many folks could we actually fund? What would be a sample size that can get us to some statistical significance? And then how do we actually enroll them? And we landed on 300 people. Initially the pilot was going to be three years, 300 folks getting cash a size like a voucher. And then within that though, we knew that we didn't want to just study some cash assistance program or cash transfer program. We wanted to study it with respects to, you know, not just as kind of factual of a control group of getting no assistance, but also the folks in the traditional Section 8 voucher program, right? To see, you know, what was working better within the two programs and how do they actually complement each other or replace each other in different ways?

Shane Phillips 37:19
Because there's not much question that giving people cash is better than giving them nothing at all. You know, a control group of nothing. But whether it leads to better outcomes or there are trade-offs associated with, you know, compared to vouchers, that's a real open question that I think we could have intuitions about, but no one really knows.

Vincent Reina 37:39
Yeah. I would say on the whole, right, when we first proposed this idea, I was like a little bit of a heretic in regards to folks were actually very skeptical of giving folks cash and said they're not going to spend it on housing, right? They will spend a lot of other things and they will be just as worse off and will spend all that money on nothing.

Shane Phillips 37:57
Yeah. Or even more so because they'll say they can spend it all on drugs and alcohol and, you know, you're going to all the things that come from that. This came up in our episode.

Michael Lens 38:05
Or it's a work disincentive.

Shane Phillips 38:09 Yeah. With Jiaying Zhao, our episode on unconditional lump sum cash transfers to people experiencing homelessness. This, you know, was a big concern. Of course, they found actually the opposite was true, but, you know.

Vincent Reina 38:19
yep, you know, and a lot of research shows that right? And similarly, though, the voucher folks were very concerned that we were somehow kind of undermining the premise of rental assistance and potentially, you know, making a case against the voucher program when it was never meant to be an either or, it's kind of a both end, right? We need a broader spectrum of assistance products right to ensure that folks can be actually access the assistance and benefit from it.

Michael Lens 38:44
Yeah.

Vincent Reina 38:45
That's a premise of a recent paper with Kathy O'Regan and some other colleagues that we published in Housing Policy Debate. But all to say is in coming up, one of the things we didn't want to do, right, was essentially put out a big call for a program where we could only serve 300 folks. So we acknowledge the fact that the Public Housing Authority locally has wait lists for its Section 8 voucher program and its public housing program. And so we approached the Public Housing Authority and we said, hey, would you mind if we actually use your wait list for enrolling people in the study? So one of the things we wanted to do when we did this, though, in enrolling people in the study is not cause kind of a challenge of people trying to decide between one benefit versus the other. So we knew that there were going to be folks who are offered vouchers in the months and year to come, right? So we can enroll 300 households, say, who are entering the voucher program if PHA agrees to offer our program to the next 300 folks on those wait lists, right? And again, those folks on the wait list are randomly on the wait list, right? They got to put their name on a wait list, they get assigned a random number, right? And so they're randomized on this wait list already. And so we said, okay, so the next 300 folks who are offered a voucher, can you offer our study to them? And ideally, hopefully they enroll in our study and we can see the impact of a voucher on these folks, right? What we also know is because the wait lists were so long, is that we could actually go to the end of the wait list, the people furthest away who are going to be waiting and say, hey, while you're waiting, do you want to receive cash for three years, doesn't preclude you, it doesn't take you off the wait list. If you somehow get called off the wait list because it's moving way faster than anyone projected, you can actually move to the other subsidy and you should because that's a permanent program. But while you're waiting, would you be willing to enroll in this study? And then you have a whole bunch of folks in between those two groups. So you have two tails and in the middle, you have essentially all these other folks who are waiting who are likely going to be offered a voucher or public housing sooner because they're just kind of closer to the part of the list that's being called on. And so we contacted over a thousand of them to say, hey, would you be willing to fill out a survey every six months and we'll reimburse you $50 for the survey just to hear about your housing experiences. And so with that, we essentially took the randomization that occurs from these wait lists to use that to essentially randomize for our group and select a treatment group, which is the cash group, a control group, which is the no assistance group and another group which is the voucher group. And so we essentially got the benefit of randomization without having to go through a process of asking a whole lot of people to sign up for a program and reject a whole bunch of people from it and then ask them if they're willing to be our control group and all those kinds of things. And so I was really kind of proud of this approach because I think it's a really sensitive way of trying to create a program and enroll folks in it to adhere to the RCT model. But to me, it was also a really huge testament of the city and the housing authority and their interest in learning here and their ability to work really cohesively together and with researchers. And so it was a really kind of bit of a road to come up with that design and operationalize it. But I think ultimately, it's really allowed for a really good experimental setting.

Shane Phillips 41:57
Those people at the end of the waitlist, is there a general sense for how long they would probably be waiting for a voucher? Are we talking three years, five years, 10 years? I know it varies a lot city to city.

Vincent Reina 42:07
Yeah, I mean, we were fairly convinced that the lion's share would not get called up within the life of the program. And so we weren't sure of the exact timeline, and our research has shown that we've thus far been able to maintain a lot of folks within those respective groups and not have too much flow. We've had some flow from one group to another. It actually presents another whole learning opportunity without cash being an on-ramp to a voucher, which we have folks doing. But all to say is that generally, the design has remained fairly consistent with respects to groups.

Shane Phillips 42:44
So yeah, those are the groups in this study. Now let's talk about how the participants actually receive this direct cash assistance, receive their benefits and how much they receive, because it's a little more complicated than I outlined earlier just for the sake of moving us forward. So with vouchers, the amount a household receives is just that difference between 30% of their household income and the rent itself up to a certain fair market rent, which is usually like the 40th percentile rent in the city or zip code or whatever. But with cash assistance, there's no way of knowing in advance exactly how big that gap is going to be between income and rent because you don't know where they're renting, and so you can't know the rent. So tell us how you tackled that problem and what the results were in terms of how much money people were getting, generally speaking.

Vincent Reina 43:34
Yeah. So this is a really important dimension, not for just explaining the program, but also why this isn't like a universal basic income program or guaranteed income program. The guaranteed income programs, universal basic income programs have like a set dollar amount that everyone gets, and they're testing a dollar amount, which is a four. And there's a really interesting study, there's a lot of great work going on there. What this is, is this is assistance level, kind of a cash assistance determined based on your income level and rent levels. So in a city like Philadelphia, we follow these things called small area fair market rents, where essentially rents are calculated based on, and I'm sure this has come up at various points already in this series.

Shane Phillips 44:15
See episode 17 with Collinson.

Vincent Reina 44:18
And so, basically calculating vouchers at micro levels to account for the fact that rent isn't equal across the whole city, it varies by neighborhood. So the city of Philadelphia has three zones that this is the way they've done their small area fair market rent program, is they have a high cost area, high cost neighborhoods, medium cost neighborhoods, and low cost neighborhoods.

Shane Phillips 44:40
Oh, that's interesting. I thought the only way it operated was just at the zip code level.

Michael Lens 44:42
Yeah.

Vincent Reina 44:44
So yeah, you actually get a fair amount. So they've kind of merged zip codes into one of those three groups to essentially reduce the administrative burden on all ends. And it helps a little bit in a city like Philadelphia where there isn't as wide of variance in rents as some other markets, right? If you got to a place like LA and some other markets, the high is so high and the low can still be somewhat low, right? And so, not so much anymore, but all to say is that in Philadelphia, rents aren't as widely dispersed price-wise. So within that, those small area fair market rents set the kind of rent max. But then we know that someone's rental subsidy is based on the difference between 30% of their income towards the housing and what the rent is for that unit. So what we have is essentially like a variable dollar amount that everyone's receiving, right? Because our incomes vary. And not only do we live in different small area, FMR areas potentially, but also the unit we ultimately rent could be different or below any number below that small area fair market rent. So this is an interesting design feature and decision we had to make. In theory, we could just say everyone gets the difference. Everyone in the small area fair market rent is treated as essentially what the rent is for that area. So we actually looked at people's actual rent levels. And so, someone didn't get any arbitrage between their rent and the small area fair market rent. There are some models on direct rental assistance that are exploring whether to essentially allow households to capture that value. Ours did not because we wanted to follow the voucher program and its totality where in the voucher program, you essentially, your actual rent level is what determines the kind of maximum rent for the unit. So all to say is that in the cash program, there's a scenario where the median assistance payment to an individual is about $881. It's varied over time, $885, $880. But it kind of goes to some pretty extremes where there's essentially one household and where the assistance is upward of $2,000. That's an extreme outlier. And there's another few households whose payment is well below $500. And so, it's a variable subsidy amount to folks along the way, though we do have a very kind of dramatic clumping in the middle where that actual median is.

Shane Phillips 47:06
And I'm sure the same is true with vouchers as well where for some households, especially over time as their income changes, either the amount is going up a lot or going down a lot.

Vincent Reina 47:17
That's exactly right.

Shane Phillips 47:19
Hopefully more often going down as their incomes climb.

Michael Lens 44:20
Yeah.

Vincent Reina 47:21
Yeah. And that distribution we have for the voucher holders as well kind of holds fairly consistent, although funny enough in our sample, the voucher households somehow have slightly lower incomes, only slightly, and therefore slightly higher median assistance payments.

Shane Phillips 47:38
Well, thinking through the lease up process, I think a big question about cash assistance is how you deal with tenant screening requirements and I think particularly income requirements. It's not uncommon for landlords to require applicants to have a monthly income that's at least three times greater than rent. This is a number I hear a lot. And an extra, let's say $1,000 a month won't often be enough to get there for a lot of people to that three times multiple. And even if it is, the landlord might see from the income verification that this is not regular employment income, or maybe it hasn't even been showing up in the tenant's bank account because they're just enrolling in this program, so it's never shown up before. There's no way to show it other than with, you know, some evidence from the city. And in that case, it's easy to imagine the same discrimination experienced by voucher holders being duplicated here, and maybe even exacerbated because with cash assistance, the landlord doesn't have a guarantee that they'll receive the payments unlike with vouchers. So you know, these are all concerns you were well aware of, of course. So I'm curious how you thought about them and any solutions you devised or ways that you're working through this.

Vincent Reina 48:46
Yeah, and that's a really important point and one thing we wanted to learn about. Coming in, there was not like some full scale belief that a cash program is going to outperform the voucher program on every metric. It's that there are going to be clear trade offs that folks are going to make, right, or face. And we need to really understand both if those exist, then to what magnitude, right. And so one of the clear things in the voucher program is this idea of, you know, trying to help people not just lease a unit with a voucher, but essentially to move to neighborhoods with better performing schools, lower exposure to violent crime, all those kinds of things, right. And so with supports from the voucher program, but also maybe the confidence from an owner knowing the money is coming from the federal government, and it's going to come in on any given month, maybe that could increase the odds that you know, someone would be willing to lease to someone who seems lower income and therefore less able to pay. And so one of the things we're interested in is, you know, are there going to be kind of neighborhood opportunity trade offs, and that's one of the things long term we're actually looking at. But I think a couple realities came to the forefront for us, right. One is that but for some MTO agencies moving to opportunity agencies, leaning into really innovative approaches to thinking about security deposits and that kind of three month requirement. Voucher program on its own actually isn't equipped to address a lot of those things either, right. So folks are already kind of facing a lot of those natural market frictions when trying to use even conventional form of rental assistance. And there are some pilots that are kind of experimenting around that in really important ways.

Shane Phillips 50:22
Well, I do want to just interject here really quick, because I think the distinction here or one distinction is that with vouchers, you have to go through the whole inspection process. So there's no hiding the fact that you are using a voucher. And I think part of the appeal of cash assistance is the landlord doesn't need to know where your money is coming from, because like, they really don't.

Michael Lens 50:46
Yeah, source of income discrimination becomes, you know, kind of impossible, right.

Shane Phillips 50:51
And so I do think I bring this up just because I think that's sort of a selling point of cash assistance. But then there's this very real hurdle in that in that process.

Vincent Reina 51:02
Yep. No, that's exactly right. So one of the things we did is we offered all households actually got a letter saying their subsidy amount, right, that they can actually provide to a landlord on city letterhead if they so choose. The city actually in this program also is kind of shown a lot of commitment to administering the program. And so everyone in this program, they have an email address of someone at the city who answers within two hours, right, if not sooner. And with that,

Shane Phillips 51:29
I wish I could get that service.

Michael Lens 51:31
Yeah, I'm not aware of any city hotline with those kind of results.

Vincent Reina 51:37
Well, this is where like administrative burden comes in, right? If you don't have to spend all of your time like trying to get someone through 10 inspections to actually lease up a unit, you could actually use that time for other things, right? And so kind of thinking about where some of that time could be used differently in program administration is a really interesting component of this. But that said, the tenant can also essentially ask the city to even engage with the landlord directly if they so choose. So we gave them the option. Interestingly, very few people in our program have actually used that option, if any. It's literally like less than a handful. And I think the reality is that for a lot of folks, the ability to pay on day one with rent, with money, was potentially more beneficial to them than kind of the other assurances through a traditional voucher program for ensuring really fast, 100% lease up rates, right? And the flexibility, again, of what the unit actually can be, that also accelerates that component as well, right? You don't not only have to not have to go through an inspection, but you're again, making that choice as normal renters do about housing quality and other things. And so all to say is that, we found 100% uptake rate and housing rate from the program right away, which is a big kind of initial finding of difference versus the voucher program where it's more around the mid-70s in Philadelphia, right? So still fairly high compared to the national average. But overall, right, there's kind of that difference in lease up rate that we've seen already in our findings.

Shane Phillips 53:12
I could also imagine, even if you really did struggle to find a landlord who would rent to you, that you have this cash now. And so your options for finding a friend to stay with or a family member and to actually contribute something is much more substantial versus if you have a voucher, you can't use that to move in with a friend to take over their lease or something or pay your part of it. That's just not an option. So we've started to hint at some of the findings, but we're going to get into them fully here now. You used surveys, administrative data, and interviews to track outcomes for participants over the first two years with survey check-ins every six months. Let's start with the effect of direct cash assistance on two of the most catastrophic outcomes for low-income households, which are eviction and homelessness. So what did you find there?

Vincent Reina 54:07
So I would say one thing just to kind of go to what you just said. We've been very fortunate in that in these six-month surveys, they're very fairly long and exhaustive. And we've been able to maintain an 80-plus percent response rate on the whole over the course of our different survey rate waves, which has been really wonderful for being able to measure outcomes. And with these outcomes, with the survey, one of the things you're really able to do is kind of look at a broader set of measures. So for homelessness, clearly there's formal homelessness, which is kind of engagement with the homeless services systems. But there are a lot of forms of informal homelessness that exists for individuals, you know, staying with a friend or a family member for a night or multiple nights, sleeping in your car, sleeping in a hotel or motel. And so one of the things we do in this paper, in our study particularly, is hone in on the idea that homelessness is kind of a spectrum of potential forms it could take and not kind of discounting anything less than formal homelessness in a homeless shelter and the homeless system in some way, homelessness system, response system as not experiencing some form of homelessness. So when we construct these variables, similarly, right, an eviction, we know this formal evictions where someone actually goes through a court process, but we also know very well that there's a lot of informality and evictions where people are essentially forced out of their units. They're locked out. There's kind of different things that can go on. And so with that as well, we're able to ask a lot of nuanced questions about the forms of housing stability and instability, the duration and kind of look at these things in really nuanced ways. And that's one thing I think that's a real kind of power of the surveys in the long term also we have a lot of administrative data we're linking to that allows us to look at some of those traditional hard measures as well. And so what we're talking about here today is distinctly those survey based responses. So one of the things again, with this experimental design, and please stop me if I get too wonky, but we have these things called intent to treat and treatment on the treated. So with a voucher program, we know that there's a number of folks who can't use the voucher, but they're actually offered the voucher. So they're essentially received some form of treatment, even though they did not actually use the voucher in the end. And that's a really important part of the voucher story, right? We have a lot of research that focuses specifically on folks who are able to use a voucher. And there's a multitude of research showing the positive impacts, as you've discussed already, of vouchers on household outcomes. But to really understand the program, you need to also include the folks that are essentially falling out, right, and not able to use the benefit. And so with this in the study, what we find and test is kind of essentially cash, right, and we know 100% of our group were able to use it versus a control group who received no assistance. And for the voucher group, we're able to actually look at the folks who are offered a voucher, everyone who has offered it, regardless of whether they were able to use it or not, and looking at their outcomes relative to folks who are not offered a voucher, as well as folks who just were offered it and were able to use it relative to the actual kind of control group as well. So there's a lot of kind of nuance and levels in these findings. What we see off the bat, even from the first survey wave for the cash group, is just dramatic reductions in evictions. We see like over a third drop in evictions by the first wave for households. And that effect essentially actually increases over time. Similarly, for homelessness, we see a real dramatic drop initially for homelessness of the individuals. And this is accounting for all forms of homelessness, nearly 30% in the first wave. And then it grows from there in each successive wave as well.

Shane Phillips 58:01
To a bigger reduction.

Vincent Reina 58:04
To a bigger reduction. Exactly.

Shane Phillips 58:06
And this is for the cash recipients compared to the control group of people who did not receive any. They were just still on the wait list.

Vincent Reina 58:12
Exactly. Exactly. And so we're seeing, you know, what's really powerful here, right, is that at the end of the day, this is a program where we're telling folks, this is a housing assistance program, but we're not doing any check to say, did you pay your rent? Show me a rent stub, right? We're not giving it to the owner. We're giving it to the tenant and saying, this is the intent of the program. And what we're seeing ultimately is the outcomes we care about the most, which is the housing stability ones, right, for eviction homelessness going down dramatically, both initially and then kind of maintaining and growing over the course essentially of the program itself. Importantly, right. We don't want to create some like one is better than the other of cash first vouchers. I think there's a lot of multidimensionality of here of who a subsidy could be better for at what point, you know, and we shouldn't ever treat these programs as a binary either or because as we know, housing markets are complex and people's needs are also complex. But we find actually interestingly enough for eviction homelessness, especially compared to that group, the intent to treat group, which is just the folks offered the voucher, some of whom essentially were not able to use it and some were, we're finding kind of larger coefficient sizes for the cash group relative to the control group than we are finding for the voucher group relative to the control group. That said, a really positive story here is vouchers also work really well, right? They are also dramatically reducing homelessness and evictions as well. And so, they're both working really well, although in some respects, we're seeing larger coefficient sizes and effect sizes for the cash group relative to the control group for homelessness and eviction.

Michael Lens 59:54
Yeah. And as you know, one type of assistance might work better for one set of families or people with particular needs and one set of assistance might work better for others.

Shane Phillips 1:00:06
That's the follow-up study.

Michael Lens 1:00:07
Yeah. Yeah. The galaxy brain policy will be like being able to kind of triage those people into different buckets, but we're not at that point. That's all extremely promising. Another thing that I think that you were able to look at and that people would have questions about are serious housing quality concerns, right? You asked people to report on things like fire or water damage, extreme heat or cold, broken doors or locks, no functioning fridge or stove and things like that. And as we've noted, I think people would be potentially concerned that without an inspection the cash assistance group might not fare as well. What were some of the results that you guys found?

Vincent Reina 1:00:49
Yeah. So there again, importantly across both groups, cash relative to control group and voucher relative to control group, we find positive improvements on housing quality, right? Again, these are self-reported, but kind of multiple dimensions as you just mentioned with the cash group, particularly their first move to a new unit, we actually see essentially like a 21% improvement in their overall self-reported housing quality or reduce odds of reporting some of these bad housing quality standards. We are finding a bigger effect size for the voucher group. And that means that for folks who are able to use a voucher, there could actually be a benefit to that inspection and seeing actual larger coefficient housing quality improvement than the treatment group. But again, they're really important that they're both directionally and by size really important improvements in housing quality, but we are seeing a larger coefficient for the voucher group, which is theoretically what we would expect if those inspections were working. Right?

Shane Phillips 1:01:54
Yeah. So it is good to know that the inspections are doing something. It's not just an administrative burden, a bureaucratic hurdle that is contributing nothing at all.

Vincent Reina 1:02:03
That's right. This is why it's really important to think about some of this stuff because it's a series of trade-offs. We often do this thing where we evaluate housing programs based on one outcome, but folks are trading off a broader set of outcomes and some are placing higher premiums on certain outcomes than others. And so here, one program could work a lot better in one setting for one outcome and in another setting for another outcome. And those are the real kind of trade-offs as we think about it. And that's where I think going forward, I mean, I'd like to think we have many papers that are going to come out of this across a whole set of outcomes. We're linking the school data, medical records, there's a lot more we can go into on the housing side. We focus just on households with kids for this study and lots of kids' outcomes that are also going to be at the forefront. I should say, and I should have said this all along from the get-go, my colleague, Sarah Jaffee, who's in the School of Arts and Sciences in the Department of Psychology is the other lead investigator on this project. She is just the most amazing colleague and is co-leading all of this work with me. So I should have said her name from the first breath. So apologize for that, Sarah. Way more to come here. And I think though really understanding those trade-offs is something we're both particularly excited about going forward.

Shane Phillips 1:03:20
Yeah. And I don't want to come across as downplaying housing quality at all because no one should. But I do think the reality is, as you said, the vast majority of people who are eligible for housing vouchers do not receive any because we just don't have enough funding for them. And those people are not getting these inspections and they're not getting money. So lots of people are living in these homes and making these decisions about making these trade-offs and deciding to be able to get into a house, to be able to get into this neighborhood or something about this specific house despite the concerns I might have on specific things, I'm willing to make that choice again. I think there is just a level of trusting people to understand what is in their best interest. You still want standards. I feel like this is where having a more proactive building inspection program independent of a voucher program can really help where you can just ensure that the housing quality across the board is more up to snuff because why should this be something that is limited to people who have vouchers anyway? Everyone should be able to live in housing without serious problems like these. And so conditioning these inspections only on these vouchers, I understand it's just a matter of resources at the end of the day and priorities. But I think that's probably a better vision for this is people can choose the housing they want, but then it is the city's role, it's some government entity's role to inspect all housing and make sure it's meeting these minimum standards.

Michael Lens 1:04:52
Yeah. In 1949, the federal government promised us a decent home and a suitable living environment. Isn't that right? So we're still not there yet.

Shane Phillips 1:05:01
And to be clear, I'm not saying the government should be inspecting every unit before someone moves in. Landlords, you can back off. I'm just saying a more consistent, I mean, in Los Angeles, they do it about every four years is I think their target. And they just kind of let you know about a month in advance and show up and look through and it takes 10 or 15 minutes.

Vincent Reina 1:05:21
That's exactly right. And ultimately at the end of the day, to make programs that work well or if nothing else prevents some catastrophic scenario that no one wants in the news, we oftentimes create higher standards than exist in the current market. And by virtue of doing that, it creates just a level of administrative burden that maybe is warranted and justified and it sounds good and could be really great, but we need to acknowledge is different than what the market's being asked to do on its own. Right?

Shane Phillips 1:05:52
Yeah. Yeah. Well, I had a question here about lease up, but that's kind of silly because it's 100% as you say, everyone gets their money anyway, with this program, they don't have to find a landlord to accept it. So we can skip to the end because we're running out of time here anyway, but I just want to wrap up and ask you if there are any big picture takeaways from PHL Housing Plus at the end of two years and really has the program, it sounds like it's shown enough promise to keep going and expand and try new things, but I guess other than whatever big takeaways you have, I'm curious if there were any unexpected benefits or unintended negative consequences that you came across, whether in the quantitative data or just in these interviews and surveys with people. Were there any surprises?

Vincent Reina 1:06:40
Yeah. So I guess kind of multiple things to think about here. One, again, realizing I'm remiss to acknowledge Matt Fowle, who is a researcher at my center, who's done, at the end of the day, all of the data crunching for us on this, and Mimi Tansky, who's on our research team as well, and without her, that response rate would not exist amongst many other things she's done. But I think one of the clear takeaways here is not even related to housing, right? It's just more generally acknowledging that as researchers, we really can be strong partners to city officials who want to think creatively about solutions. Rachel Mulgrey and Miranda Onbury were amazing partners at the city, and one of the things that we did early on is we established the trust with each other and rapport that was about building a program, building evidence, but also kind of seeing each other as colleagues in a team. And I think at the end of the day, pilots like this don't get created or evaluated without real kind of meaningful partnership, which we've kept doing, right, and has actually led to, the city's actually about to announce that it's extending the program and the pilot for another year. Oh, that's great. So a three-year turns now into a four-year pilot, right, which is really wonderful. And part of that is a product of a lot of our collaboration and the fact that we were able to kind of take early lessons learned and present it to them so they could do real-time policymaking and speak to local officials about things like budgets, right, and how to actually fund the program and why you should fund the program. So I think one of the real learning opportunities through all this is that policy actually can be kind of reflective and responsive, but also still adhering to a research design. And those don't have to be in opposition with each other. I think another thing that just is really kind of striking to me is just, I think this is like the age-old academic story of like, we think we know so much and we still have so much yet to learn, right? So much yet to learn about the way rental markets work, the way tenants are engaging with it and using subsidies, the trade-offs that households are making, the way that owners and tenants are engaging with each other. And I think we have a lot of really powerful insights that are going to be coming out from a lot of our qualitative work, a lot of our interviews and other stuff that I think is really going to show a lot of that nuance, which I think we know that, for instance, vouchers work well, but there's a lot that happens while someone's receiving a voucher that actually is kind of intermediating the effect of the voucher, right? And we need to actually know those things and understand them. And so I'm really excited about what's yet to come from what we've collected.

Shane Phillips 1:09:14
Well, that is exciting to hear that you get to keep studying this for another year because I'm sure that extra year will make a big difference. And hopefully, these programs can expand to more cities, including ours down here in Los Angeles. So Vincent Reina, thank you for joining us on the Housing Voice podcast. Really appreciate it.

Vincent Reina 1:09:32
Really fun. Thanks for having me. And make sure to come to Philly. You promised now.

Shane Phillips 1:09:36
Soon as possible, after summer. You can find a link to Vincent's work on our website, lewis.ucla.edu. No notes and a transcript of the interview are there too. The UCLA Lewis Center is on the socials. I'm on Blue Sky at Shane D. Phillips, and Mike is there at mc-lens. Thanks for listening. We'll see you next time.Shane Phillips 0:00
Hello, this is the UCLA Housing Voice podcast, and I'm your host, Shane Phillips. This week, we're joined by Vincent Reina to share findings from the study of a new approach to delivering rent assistance to low-income tenants. The pilot program, operating out of Philadelphia, compares outcomes for tenants who receive direct cash assistance to those receiving traditional housing vouchers, as well as eligible households who don't receive any financial assistance. As we've talked about in episodes from late 2024 and early 2025, housing vouchers provide critical assistance to low-income renters in the U.S., but many end up going unused. One big reason why is the difficulty of finding a landlord who accepts vouchers. A problem that could be solved, the thinking goes, if tenants don't have to use a voucher to pay at all. With cash deposited into their bank accounts instead, recipients may be less stigmatized and gain more autonomy in deciding where to live and how they want to balance housing cost, location, and quality. Two years into the pilot, the results are promising. Evictions and homelessness are down, and while tenants who receive housing vouchers end up with fewer housing quality concerns than those who received cash, both groups see big improvements over those who got neither. And as Vincent emphasizes, the study is also a great illustration of how academics and local governments can partner to test reforms that can later be scaled up, and it's a model for research that's both methodologically sound and sensitive to the needs and experiences of its subjects. I neglected to name Vincent's co-authors at the start of the interview, so allow me to fix that now. The Cityscape article from earlier this year was authored by Vincent, Matthew Fowle, Sarah Jaffee, Rachel Mulbry, and Miranda Fortenberry, and the report on outcomes two years into the pilot program includes all those already mentioned, plus Mimi Tanski. The Housing Voice Podcast is a production of the UCLA Lewis Center for Regional Policy Studies with production support from Claudia Bustamante, Brett Berndt, and Tiffany Lu. Send your questions and feedback to shanephilips@ucla.edu, tell your friends and colleagues about us, and urban planners, remember that you can get AICP credit for listening. With that, let's get to our conversation with Vincent Reina.

Shane Phillips 2:39
Vincent Reina is a professor in the Department of City and Regional Planning at the University of Pennsylvania, among many other titles, and was a senior advisor on housing and urban policy with the White House Domestic Policy Council under President Biden. And he's here to share his research on an alternative approach to delivering rent assistance to low-income households, one that provides cash directly to tenants instead of landlords. Vincent, thanks for joining us and welcome to the Housing Voice Podcast.

Vincent Reina 3:07
Thank you for having me.

Shane Phillips 3:09
And my co-host today is Mike Lens Hey, Mike.

Michael Lens 3:10
Hello, Shane. Hello, Vincent. Great to be here.

Shane Phillips 3:14
As always, we start off each episode asking our guests for a tour of a place they know well. So where are you telling us about today, Vincent?

Vincent Reina 3:20
So I'm going to tell you about the wonderful city of Philadelphia, which I know Mike recently visited and hopefully, Shane, you'll come out this way soon if you haven't been here recently.

Shane Phillips 3:29
I've never been. I'm embarrassed to say somehow I do want to visit. I guess now is not the time of year, but hopefully it won't be too long.

Vincent Reina 3:38
Fall in Philadelphia is absolutely wonderful. So I live in a neighborhood called Queen Village, which is a very centrally located neighborhood within Philadelphia. And I actually walked to work because in my research lab, we rent space from the Federal Reserve Bank of Philadelphia. Funny enough, they sublet out space and we were fortunate to be able to lease some of that space. So my walk starts in Queen Village, right? And interestingly enough, one of the first things you do when you leave Queen Village is you cross the street called South Street. You might have heard about cruising on South Street from Boyz II Men songs.

Michael Lens 4:11
Ooh.

Vincent Reina 4:12
There you go.

Michael Lens 4:14
The Motown Philly song. Yeah. I got that lyric right there.

Vincent Reina 4:17
There you go. There you go. And what's interesting about South Street, right, is it was supposed to be an east-west highway that was going across the city and the neighborhoods actually actively fought against it. And during this time, property values all around what was going to be a highway essentially went from low to essentially near zero, right? So my home was bought by the prior owner for a dollar because no one wanted to live by a highway construction site, no less by a major highway when it was done. And so kind of really interesting to think about the street you cross and I cross all the time that could have and was going to be a highway. But as of 1974, I got taken off the docket and they actually moved it a bit further north. Funny enough to where I am right now, right by the Federal Reserve Bank of Philadelphia. But all to say is this kind of major housing transportation nexus and the history that could have been very different is just a little a stone's throw from my house, right?

Shane Phillips 5:17
Did they ever do any demolition before that freeway? I'm thinking of, Mike, you know, through Beverly Hills on, I can't remember, Santa Monica Boulevard or somewhere where there's like a linear park that's just right next to the street. And that was, as I understand it, because they had done a bunch of demolition in preparation for a freeway that was ultimately blocked.

Michael Lens 5:36
Yeah, that's Santa Monica Boulevard.

Vincent Reina 5:37
Yeah, not that I know of. This is where some of my historian professor colleagues would be much more-

Shane Phillips 5:44
They didn't get that far.

Michael Lens 5:45
Yeah.

Vincent Reina 5:47
But yeah, so I mean, it's pretty amazing. And then I just crossed from there and walked through Society Hill, which is like the oldest kind of most beautiful part of Philadelphia, pass by the Liberty Bell and all of those very historic landmarks along the way. To me, it's really kind of cool to be in the center of a big city, right, where you can have this historic row house neighborhood, you know, and you walk straight up through so much history to work every day. And to me, that feels like a very kind of Philly reality. Or at least the reality that I'm fortunate to live.

Michael Lens 6:19
Yeah. I recently had the red carpet treatment in Queens Village, of course, hanging out at Vincent's house. You know, I feel that part of my red carpet experience, of course, was hanging out with your family and specifically your young girls who are like working on a Ph.D. in hugs. I mean, they are they just, you know, in the middle of conversation, just get up and hug you. And it's, oh, wow, you're so nice.

Vincent Reina 6:49
You're exceptionally huggable, Mike. That's the...

Michael Lens 6:53
OK. Well, not everybody would say that. Not even my own family finds me all that huggable these days, but that's having teenagers, I think.

Shane Phillips 7:01
All right. So this time we are talking about a couple of publications by Vincent and his colleagues at Penn and the Philadelphia Housing Development Corporation. The first is an article from 2024 in Cityscape titled The Future of Rental Assistance, Lessons Learned from Implementing and Evaluating a Direct to Tenant Cash Assistance Program, PHL Housing Plus. So that one explains your motivations for studying this program, which is an alternative to the housing choice or Section 8 voucher program, and then lessons from the setting up of the evaluation study, not really the study itself. The second publication is coming out in mid-July, a little bit after we're recording this episode, and it reports on the trial's outcomes two years in, which we got a preview of before this interview. That publication is titled PHL Housing Plus, A Randomized Controlled Trial of a Cash-Based Alternative to the Housing Choice Voucher Program in Philadelphia, PA, telling us exactly what this is about.

Vincent Reina 8:02
You're kind of convincing me here we need to workshop our titles a little. So maybe at the end we could play with that a little.

Shane Phillips 8:08
I don't know. I mean, I appreciate a title that just tells you exactly what it is. There's no guessing what's going on here.

Michael Lens 8:14
No puns. We're just getting right to it.

Shane Phillips 8:18
Mike Manville would love it. So we have talked about housing vouchers quite a few times now on Housing Voice, which should not be surprising given that our show's name is an allusion to that very program. Episodes 17, 87, and 88 are all focused squarely on vouchers, and they're a key part of conversations with Beth Shin, Andrew Fenelon, and a few others. So we will not spend much time on background in this episode, I don't think. Keeping it fairly brief, I'll just say that vouchers are the main way we provide rent assistance to low-income households in the United States. And if I have read the HUD dashboard a couple of days ago correctly, it serves more than 2.3 million households and costs around $25 to $30 billion a year in its current form. Recipients can use their vouchers to rent housing on the private market, paying no more than 30% of their household income with the government picking up the difference up to a maximum rent level. Vouchers are a pretty well-regarded means of providing assistance to renters, just broadly speaking internationally, I think. But as our previous conversations make clear, the housing choice voucher program is not without its shortcomings, and that includes insufficient funding for sure, poor performance helping people move into higher opportunity neighborhoods in many cases, and fairly low rates of successful lease up, especially in more expensive markets with fewer vacancies. Using these vouchers requires landlords to accept them as a form of payment, making it a fairly unique kind of public benefit. And there are various reasons that landlords might be inclined not to accept them, many of which we talked about in episode 87 with Sarah Strochak. There is a hope that if we could skip that step and just give renters the money directly, then we could eliminate a lot of the friction in the current system and improve outcomes in a bunch of different ways. That is the theory, and it's what we're going to talk about today, along with what Vincent and his team found when they actually tested it out in the real world. So here's where I will turn it back over to you, Vincent. I would like to start by having you give us more of the background and motivation behind this direct-to-tenant rental assistance pilot. And I think Philadelphia's experience with the Emergency Rental Assistance Program, or ERAP, may be a good entry point. This is kind of how you open your cityscape article. ERAP was the federal program that helped people with rent in the wake of the COVID-19 pandemic, sending tens of billions of dollars out across the country. So tell us a bit more about some of the challenges implementing it in Philly and how this effort to provide short-term or one-time assistance to tenants in this emergency context led to an interest in changing the Housing Choice Voucher Program, which serves a quite different purpose than ERAP and is a much more stable program, at least for now.

Vincent Reina 11:06
Yeah. So thank you for that, Shane. And I'm going to actually take one step back because the fun thing about doing something like this is I get to blab away until you cut me off about things that I can't put in papers, right? And so –

Shane Phillips 11:17
We can always edit out, so –

Vincent Reina 11:21
Fair enough, fair enough. So interestingly enough, the idea for PHL Housing Plus came out before ERAP because I was very fortunate to have this fellowship that embedded me part-time with the City of Philadelphia, where I was working with the city to help think through housing solutions, right? And I had just worked with them to develop the first-ever citywide housing plan. The city wanted to do big, bold things and try new things, acknowledging that in a city with limited resources, they often couldn't fund the whole solution to a problem, but they could create the inroads for new solutions that we haven't tried thus far that hopefully can expand resources down the road. So with that context in mind, I had actually been working with a colleague at the Center for Guaranteed Income here, Amy Castro, to design for the City of Philadelphia essentially a cash assistance program that was going to be a thousand-person randomized controlled trial for the city that the city was actually going to fund through their city budget, right? And so we spent a whole year developing this program, the concept of it. We're talking through talking points. The mayor actually put it in his budget proposal at that time, Mayor Kenney. And then lo and behold, a week later, the city shut down because of the COVID-19 pandemic. So here we had like a $35 million locally funded thousand-person randomized controlled trial of this really interesting, innovative approach to housing assistance. And we got the rug pulled out from under us as everyone across the country did during that time, right? Enter ERAP, right? So the emergency rental assistance program, clearly something very different, responding to a pandemic meant to provide emergency relief. But one of the things that happened was because I was working so closely with the city, quickly pivoted to help them think about this program, right? And one of the things that became very apparent from this program in Philly, and Philly was in some ways the first mover in that some people were kind of developing their programs on day one, others weighed a little bit to see what funding rules said, all these kinds of things. But one thing that was very clear is you had to get money out the door very quickly. And you had to deliver rental assistance through whole new systems that often didn't exist for a city, right? Because as you know, well, public housing authorities administer the housing voucher program, not cities themselves. But then beyond that, you need to make sure it got into people's hands, essentially, no matter what, right? And not no matter what with no strings attached at all, but a big no matter what was regardless potentially of whether an owner wanted to receive the rental assistance or not, right? One of the early challenges faced by eRAP programs was one highlighting the fact that oftentimes cities don't have relationships with a lot of property owners, there's not easy mechanisms for them to reach them. There's a lot of reasons why owners are just stressful of cities, right? And so all to say is, enter that landscape where you're trying to get money to tenants through them very, very quickly, you can get into a lot of frictions, right? And so the city of Philadelphia realized off the bat, even with limited resources, that they were having a really hard time getting eRAP funds into the hands of tenants who are applying for the assistance. Some of these tenants didn't know who their owner was, some of the process of getting owner consent was arduous. And sometimes it worked out well, but a lot of times it actually didn't. So acknowledging that the city of Philadelphia was actually one of the first to quickly pivot to say, hey, can we actually offer these funds directly to the tenant, right?

Shane Phillips 14:50
Just as a tangent, do you know the reason that a landlord would not make it as easy as possible for the tenant to get these eRAP funds? I'm sure there's good reasons, but it just seems like, why would they turn down this money?

Vincent Reina 15:07
Well, yeah, in the city of Philadelphia, where essentially less than half of our properties are actually even registered with the city, right? There's already kind of like a lack of initial engagement. In some ways, because of politics of the past, the legitimate skepticism of the city government and I think there was a lot of fear at first that what would these funds actually mean for some of those owners, right? Was just funds during the pandemic to give to folks to solve current rent arrears or was this going to come with other obligations? Early emergency rental assistance programs tried to often tie on things like you can't evict someone for a certain period of time, all these other kinds of qualifications.

Shane Phillips 15:45
If I accept this money, then am I now obligated to not evict this person until this emergency is over? Even though that generally was true, regardless, I think, but I can see how you could jump to conclusions about other things being required that you don't even know yet.

Vincent Reina 16:02
That's exactly right. Yeah. So it kind of opens up a potential Pandora's box for some folks who already kind of shell shocked as we all were in the beginning of the pandemic and trying to figure out what's going on and created a real moment of friction. So worked with the city of Philadelphia very quickly to pivot and at that time, Paul Williams had also been testing this out when he was with the city of Chicago, were essentially the first two places to say, hey, we think we actually have the authority to give the money directly to tenants if an owner does not agree to enter the program, right? So in doing that, it laid a lot of the kind of groundwork and thinking of what could a direct attendant program actually look like. As my center, we then actually worked with the city of Los Angeles on this very policy as well. They were, I think, possibly the third and by far the largest city to initially move to this direct attendant option because they were facing this challenge. As you know well, Maxine Waters, who was one of the big champions of a lot of the emergency relief funds going around housing and helped construct a lot of those programs, quickly saw the challenges that LA was facing and leaned into a lot of the ways to make this program more efficient throughout the whole life of that program, but not the least of which was early on with exploring, hey, could we do this direct attendant model, right? Which in many ways was actually never really done or was only done once before the voucher program was created at a national scale and so really pushed against a lot of priors that we all have around housing assistance that we think is actually based on evidence. What's interesting is in building the case for the initial pilot before the ERAP came in and then talking about ERAP, you realize there's actually little empirical evidence at all testing this kind of direct attendant option. It opened up kind of a world of opportunities that allowed us to pivot and then raise some private capital through philanthropy. The city put in some of their own flexible money and essentially develop a smaller pilot that we ultimately launched in 2022.

Michael Lens 18:01
Cool.

Shane Phillips 18:03
Yeah, I wonder if LA's rental registry helped with that distribution here locally because we established that only for our rent stabilized housing stock, but that's the majority of multifamily housing and maybe the majority of all rentals in the city and that was back in 2017 or so and I know not all landlords are registered still, which is crazy to me, but hundreds of thousands of them are and so there is some, it's not even as I understand it, it doesn't provide direct information about the tenants, but it's a level of knowledge about ownership and which units are leased up and even like the rent they're paying and things like that that most cities just have no insight into directly.

Vincent Reina 18:48
Oh, absolutely. And then you just have like a lot of noise of different policies going on. So we actually did a survey of LA owners at that time. I know we're not talking about ERAP, but I'll just kind of do this one quick and one thing that became clear is that there were local ordinances being passed around evictions in LA that were independent actually of the rental assistance program, but it's really confusing for folks because government's government, right? And so there was actually the strong misconception that a lot of the local ordinances were actually tied to the emergency rental assistance funds, which they weren't, they were coterminous, right? So it's almost like you were better to accept the funds because you were subject to these rules anyway, but naturally it was easy for folks to feel confused about what was actually pushing the regulations on them in different forms. And so I think for LA, while they had this great registry and in many ways actually had a lot of really interesting engagement with owner groups and everything else, there was clearly a lot of broader policy making going on at the city level and the state level that made it hard for people to discern where the regulations were really being, were coming from at the time.

Shane Phillips 19:52
Yeah. In the first article, you say how you were hoping to test three outcomes in this trial or three kind of categories of outcome. And I think reviewing them first will be a good way of explaining the motivations for trying out direct to tenant rental assistance, a little bit more of the frictions that you mentioned. We'll get into program design later, but for now listeners can just think of direct to tenant rent assistance as simply taking whatever amount the voucher would have paid to a landlord and instead depositing that into a bank account or in this case, I think a preloaded debit card for the tenant each month. We'll go through each of these sets of outcomes one at a time and we'll start with reduced administrative burden. You talk about burden from the perspectives of three different groups, tenants, landlords, and public housing authorities. What are those burdens and how do we think that direct cash assistance might reduce or even eliminate them?

Vincent Reina 20:45
Yeah. All the stuff here I imagine is going to reiterate stuff some folks have said in the past. We know that for tenants, aside from the whole process of applying for vouchers and waiting a long time and being called off the wait list, which is a very long arduous process, once you're actually offered a voucher, there's significant paperwork that needs to be done to actually get you through the process. One of the things you have to do then is go on a private market and find an owner who will accept this form of rental assistance. Some owners might not know what a Section 8 voucher is, so there's the burden of educating folks what this thing is and how you can use it. Some owners do and have preconceived notions of what the actual program is or isn't, legitimate or illegitimate. With that too, though, for a tenant, even once you maybe find a unit that will accept your voucher, you then have to actually get your unit inspected through a formal inspection process. What that does is actually increases time and friction for me actually being able to use the voucher and move into the unit. It also means there's a scenario where that unit could fail and now, I actually have to go look for another unit, maybe possibly while I'm on the verge of homelessness and really housing unstable in this moment. What you realize in the normal voucher program, aside from a lot of paperwork, there's ultimately a lot of process that actually leads to – that ultimately gets to someone to leasing up a unit that gets to that scenario where we get to that 60% number nationally, right? 40% of people who are finally offered a voucher are not able to actually rent a unit with it. We looked at that in LA and that number is even dramatically lower, right? It's 56% for once offered a voucher, but if you go even before that phase, it's dramatically lower than that. All to say that the tenants facing all these frictions when all they're trying to do is use the benefit that they're being offered because ultimately, they can't use it unless an owner says yes. They say yes, they're not just receiving it, but all the structure of the program that HUD has around it as well, right? In this project, we realized very quickly that there's been actually little experimenting on how much of that process actually leads to better outcomes for folks with respect to not just finding a unit, but also the quality of the unit, where it is, all that kind of stuff. Similarly, for an owner, right? I was just looking to rent my unit, someone approached me with a voucher. This potentially could be a good thing because a portion of it is coming from the federal government, so that's actually kind of a guaranteed or more guaranteed payment stream and I could view it positively that way, but at the same time, there's a lot of set structures and rules that I have to adhere to to actually join this program and have you in it. Once you're in it, there's a lot of regulatory structures about engaging with voucher households. They're fairly straightforward, but when we think of the fact that the idea of renter protections are actually pretty minimal or nonexistent in many markets, you have a program that has even some slight very rational protections and it becomes a layer of burden for an owner who has a counterfactual of another tenant who doesn't come with any of these restrictions or rules, right? Beyond that, there's a housing authority that's going through this long process of calling people off waiting lists, getting people to come in, fill out paperwork, making sure all the paperwork is correct, bringing people through that inspection process, going through the whole leasing process, going through all these recertifications along the way, right? On all three dimensions, you have folks essentially being exposed to a set of process that's just a function of trying to bridge this contract between owner, tenant, and government, right? Whereas normally, the relationship is just owner and tenant. In that, it creates a lot not just time but cost for all the parties involved and leads to a lot of scenarios where there's kind of failed cases of someone being able to lease a unit with the voucher that's suboptimal for the tenant, for the housing authority that has to go through this whole paperwork process with them again, but then also potentially for that owner who then is still looking for someone to actually lease their unit.

Michael Lens 24:50
And this is all fairly paternalistic in a way as well, right? And I think there are costs and benefits or trade-offs to kind of paternalistic policies like this, right? But specifically, we don't give the money to the tenant, right? That payment goes directly to the landlord. And so, we're very clearly specifying what the money can and cannot be used for. And then we don't trust them to find a decent home or what we kind of provide our own standards as governments and housing authorities for the unit by inspecting the unit above and beyond what the tenant inspects, right? So, there's good and bad reasons for these things to be embedded in the voucher program. But it's just kind of worth thinking about like why we don't trust people with the money and with the decision-making process, right?

Vincent Reina 25:47
Right. And it also makes a lot of assumptions about like the way the housing market works, right? Some people pay their rent in installments, not at the first of the month. There's kind of a lot of income volatility over the course of a month that someone can't smooth with the voucher, right? There's a lot of informality in our housing market with respects to lease structures, living arrangements, right? Voucher program has very strong rules about what a household is and whose income counts towards that household income and a lot of other factors like that, right? That actually don't map on often to the way the housing market works for a lot of folks, but particularly for low-income folks in the rental market.

Shane Phillips 26:28
This is veering into current events and current policy proposals, but I think there is a proposal in the Republican House bill or something along those lines. Maybe it's just by the presidential administration to limit vouchers to only a two-year term and once you've used that, you're done. And I think there's obvious reasons why that would be disastrous for a lot of people, but something I actually hadn't thought about is from the perspective of a landlord, if you know that this is only in the last two years and then you're gonna have to find a new tenant again because there's a good chance they're gonna have to move out, that's just one more reason actually not to accept vouchers and could really lower the lease-up rates even more.

Vincent Reina 27:15
Yeah, we can have a whole episode on the arbitrary two years and why that's a really inefficient setup, but I agree that's another important kind of cost and these are transaction costs for folks, right, that people actually think about and account for when making decisions about where to live and who to lease to.

Shane Phillips 27:31
So that's the rationale for why direct-to-tenant assistance might reduce administrative burdens for all these different groups. Next up is its potential to improve lease-up rates and tenant choice in housing options and I feel like we're already sort of getting here. What are the problems with vouchers here and how might direct assistance help?

Vincent Reina 27:50
Yeah, so here, you know, as kind of alluded to already, we know that a lot of folks can't use their voucher and to jump ahead to one of our findings, right, if you're giving them money directly to the tenant, the odds of getting to 100% use rate is a lot higher. And so, there's a reality of taking out that kind of middle ground of having to negotiate a contract actually increases someone's ability to find housing and lease housing with assistance that they're providing, right? So I think one of the challenges and the travesties of this voucher program right now aside from it being dramatically underfunded and tons of research has shown fortified households for everyone who actually uses one is that, you know, a lot of folks when offered one can't use it. And for those folks who can't use it, their counterfactual is quite dire, right, in the trade-offs that they actually make. So all to say is that when we think of our like 60% use rate for the voucher program nationally, it's not just a problem of, you know, the program doesn't work for everyone. It's that who it doesn't work for, those folks are really worse off as a result of it. So all to say is that this cash program could actually help with lease up and that it's essentially, again, reducing that administrative burden and giving more agency to the tenant in actually finding the unit and flexibility even of what that unit looks like. And by virtue of doing that, it opens up their choice set, right? So in our model right now, there's no inspection requirement for this program in order to lease up your unit. And so that means that a household is making a decision about unit quality, unit location in a way that you or I normally do, right? I live in Philadelphia where there's no such thing as a proactive housing inspection. So my housing inspection, when I go rent a unit is me going to rent that unit and deciding that it's a good enough quality relative to all the other things I'm looking for in that housing unit. So all to say is that it kind of gives more agency to the tenant to find a unit that matches their needs and to be able to then successfully lease up the unit with the subsidy that's trying to get them into housing.

Shane Phillips 29:56
And the last thing you're interested in was greater flexibility and the ways that might lead to better housing outcomes. Tell us how traditional vouchers can end up restricting recipients options and how cash assistance might open up more of them. I was particularly interested in how direct assistance could help tenants stay in their current homes, which was something that also came up in our conversation with Sarah Strochak. And I think it feels underappreciated as a common use of vouchers. It certainly was by me. Maybe just because so much voucher research focuses on moving to opportunity rather than staying in place.

Vincent Reina 30:29
Yep, exactly. So there's an interesting, that's a great point, right? We've focused rightfully on the idea of ensuring neighborhood access and what that can mean for someone's kind of economic mobility and growth and wellbeing. But a lot of times a stable housing situation could be the best thing for someone's economic wellbeing and mobility. And so this idea, right, that for a lot of tenants who are offered a voucher, they might not actually be able to lease their current unit they're living in and would therefore have to move is a real challenging one for that individual, right? Because there's a cost of moving, right? There's social costs, there's financial costs. You have to have another unit you'd actually move to. But then beyond that, even if you rent your current unit or your future one with the voucher, again, kind of coming back to a point I hit on slightly, my income might come in gradually over the course of a month, right? I could get paid daily. I could get paid weekly. I could get paid biweekly, right? Sometimes we have income shocks that come up in a week this week that I didn't expect, but I can recover from it next week. When I have something like cash assistance, I have the autonomy of that flexible dollars in my pocket where I know I'm going to pay rent and I'm budgeting for my rent and maybe that rent actually isn't all due on the first of the month. Maybe actually I'd pay my rent in installments because my income flows that way. But then I could trade off across my income and expenses to ensure my rent is paid and I'm able to cover other things that all don't flow in the kind of same way that rent flows. So if I have to spend all my money on rent on the first of the month, right? And then I have nothing for the next two weeks, what happens to my other two weeks of expenses? So the cash model allows someone to essentially budget and to budget their dollars and to acknowledge the fact that housing is our largest consumption good, but it's not our only. And we often have income coming in through various forms, particularly for low-income households that then allows me to essentially smooth my housing consumption and smooth my other consumption that could really improve not just my housing outcomes, but a broader set of outcomes, right? I can afford to actually pay for the daycare this way. I can not take out a loan to act as a bridge towards certain costs, right? That I know I have every single month. And that's a real level of financial autonomy that's desirable, right? From an economic perspective for individuals, but also societally for the way we want people to budget money and the way we essentially do budget money.

Michael Lens 32:54
I was at the Wu-Tang concert a week ago, almost exactly one week ago.

Shane Phillips 33:30 Great transition.

Michael Lens 33:02 And as everybody listening knows, cash rules everything around me, right? Cream. That's – the Wu-Tang taught us that. Economists teach us that. Vincent just taught you that. This is what we do. Cash rules everything around.

Shane Phillips 33:19
Well, and I mean, and back to your paternalism comment too, I think there's this, you know, this comes back to essentially not trusting people to budget for themselves, but speaking as someone who makes a lot more money now than I did 15 years ago, I was budgeting much more carefully when I was younger and poorer than I am today. And so this idea that, you know, poor people don't know how to budget, like they're more experienced at it than anyone. Okay. So I think we can start getting into the evaluation itself. As I mentioned earlier, this was a randomized controlled trial, right in the title of the paper, which is described as the gold standard of experimental design, a phrase we've used probably literally every episode that RCTs have come up on this show. And I think every researcher says gold standard whenever RCTs come up and you have to explain it to non-researchers. These kinds of trials allow researchers to make plausible claims about causality. So for example, if your RCT was designed well, and you found that tenants who received direct cash assistance ended up in lower poverty neighborhoods or with less evictions on average than those receiving vouchers or not receiving anything, then it's likely that the direct assistance program was responsible for that outcome and you can make that claim. Give us a quick overview of how you selected the different groups in this RCT randomized controlled trial and the kind of intervention or treatment that each group received.

Vincent Reina 34:50
Yeah. And I want to thank you, one for promoting the potential benefits of RCTs, right. But also to like, just use that to reiterate that this was very much a learning opportunity, right? We developed a pilot to learn. This wasn't the creation of a permanent program, it was the acknowledgement that there were so many priors set up in our current way of providing housing assistance that we've never tested or learned from that we really should learn from this, which is why the idea of designing this program, both as a pilot, but then one that followed a randomized control trial kind of format was really important for the city itself. And I can't speak highly enough to the city and its leadership for acknowledging that, right? It's something that every city is jumping to do because it requires a lot of thought and process on the front end about how you're actually enrolling people and a commitment throughout the whole thing. I mean, we're so such good partners with the city in that way and they've made a lot of decisions to ensure we can actually study and measure this.

Shane Phillips 35:50
And so there's a risk to there of like, you know, what if the results are not as you hope and then the city kind of has to, they're going to take some responsibility for that rightly or wrongly. And so there's, there's a risk there as well. But I do think you're talking about, I think it was $70 million or so total. Is that, is that right?

Vincent Reina 36:08
Originally the pilot was going to be $35 million. It's much less than that now that we've, yeah.

Shane Phillips 36:12
So let's say, you know, in the tens of millions of dollars to potentially influence a program that, as I said, spends $25 plus billion a year nationally. And I think this would probably not be the first program to potentially influence the housing choice voucher program over its long tenure. But please continue.

Vincent Reina 36:33
Yeah. So one of the things we knew is we were trying to first kind of figure out how many folks could we actually fund? What would be a sample size that can get us to some statistical significance? And then how do we actually enroll them? And we landed on 300 people. Initially the pilot was going to be three years, 300 folks getting cash a size like a voucher. And then within that though, we knew that we didn't want to just study some cash assistance program or cash transfer program. We wanted to study it with respects to, you know, not just as kind of factual of a control group of getting no assistance, but also the folks in the traditional Section 8 voucher program, right? To see, you know, what was working better within the two programs and how do they actually complement each other or replace each other in different ways?

Shane Phillips 37:19
Because there's not much question that giving people cash is better than giving them nothing at all. You know, a control group of nothing. But whether it leads to better outcomes or there are trade-offs associated with, you know, compared to vouchers, that's a real open question that I think we could have intuitions about, but no one really knows.

Vincent Reina 37:39
Yeah. I would say on the whole, right, when we first proposed this idea, I was like a little bit of a heretic in regards to folks were actually very skeptical of giving folks cash and said they're not going to spend it on housing, right? They will spend a lot of other things and they will be just as worse off and will spend all that money on nothing.

Shane Phillips 37:57
Yeah. Or even more so because they'll say they can spend it all on drugs and alcohol and, you know, you're going to all the things that come from that. This came up in our episode.

Michael Lens 38:05
Or it's a work disincentive.

Shane Phillips 38:09 Yeah. With Jiaying Zhao, our episode on unconditional lump sum cash transfers to people experiencing homelessness. This, you know, was a big concern. Of course, they found actually the opposite was true, but, you know.

Vincent Reina 38:19
yep, you know, and a lot of research shows that right? And similarly, though, the voucher folks were very concerned that we were somehow kind of undermining the premise of rental assistance and potentially, you know, making a case against the voucher program when it was never meant to be an either or, it's kind of a both end, right? We need a broader spectrum of assistance products right to ensure that folks can be actually access the assistance and benefit from it.

Michael Lens 38:44
Yeah.

Vincent Reina 38:45
That's a premise of a recent paper with Kathy O'Regan and some other colleagues that we published in Housing Policy Debate. But all to say is in coming up, one of the things we didn't want to do, right, was essentially put out a big call for a program where we could only serve 300 folks. So we acknowledge the fact that the Public Housing Authority locally has wait lists for its Section 8 voucher program and its public housing program. And so we approached the Public Housing Authority and we said, hey, would you mind if we actually use your wait list for enrolling people in the study? So one of the things we wanted to do when we did this, though, in enrolling people in the study is not cause kind of a challenge of people trying to decide between one benefit versus the other. So we knew that there were going to be folks who are offered vouchers in the months and year to come, right? So we can enroll 300 households, say, who are entering the voucher program if PHA agrees to offer our program to the next 300 folks on those wait lists, right? And again, those folks on the wait list are randomly on the wait list, right? They got to put their name on a wait list, they get assigned a random number, right? And so they're randomized on this wait list already. And so we said, okay, so the next 300 folks who are offered a voucher, can you offer our study to them? And ideally, hopefully they enroll in our study and we can see the impact of a voucher on these folks, right? What we also know is because the wait lists were so long, is that we could actually go to the end of the wait list, the people furthest away who are going to be waiting and say, hey, while you're waiting, do you want to receive cash for three years, doesn't preclude you, it doesn't take you off the wait list. If you somehow get called off the wait list because it's moving way faster than anyone projected, you can actually move to the other subsidy and you should because that's a permanent program. But while you're waiting, would you be willing to enroll in this study? And then you have a whole bunch of folks in between those two groups. So you have two tails and in the middle, you have essentially all these other folks who are waiting who are likely going to be offered a voucher or public housing sooner because they're just kind of closer to the part of the list that's being called on. And so we contacted over a thousand of them to say, hey, would you be willing to fill out a survey every six months and we'll reimburse you $50 for the survey just to hear about your housing experiences. And so with that, we essentially took the randomization that occurs from these wait lists to use that to essentially randomize for our group and select a treatment group, which is the cash group, a control group, which is the no assistance group and another group which is the voucher group. And so we essentially got the benefit of randomization without having to go through a process of asking a whole lot of people to sign up for a program and reject a whole bunch of people from it and then ask them if they're willing to be our control group and all those kinds of things. And so I was really kind of proud of this approach because I think it's a really sensitive way of trying to create a program and enroll folks in it to adhere to the RCT model. But to me, it was also a really huge testament of the city and the housing authority and their interest in learning here and their ability to work really cohesively together and with researchers. And so it was a really kind of bit of a road to come up with that design and operationalize it. But I think ultimately, it's really allowed for a really good experimental setting.

Shane Phillips 41:57
Those people at the end of the waitlist, is there a general sense for how long they would probably be waiting for a voucher? Are we talking three years, five years, 10 years? I know it varies a lot city to city.

Vincent Reina 42:07
Yeah, I mean, we were fairly convinced that the lion's share would not get called up within the life of the program. And so we weren't sure of the exact timeline, and our research has shown that we've thus far been able to maintain a lot of folks within those respective groups and not have too much flow. We've had some flow from one group to another. It actually presents another whole learning opportunity without cash being an on-ramp to a voucher, which we have folks doing. But all to say is that generally, the design has remained fairly consistent with respects to groups.

Shane Phillips 42:44
So yeah, those are the groups in this study. Now let's talk about how the participants actually receive this direct cash assistance, receive their benefits and how much they receive, because it's a little more complicated than I outlined earlier just for the sake of moving us forward. So with vouchers, the amount a household receives is just that difference between 30% of their household income and the rent itself up to a certain fair market rent, which is usually like the 40th percentile rent in the city or zip code or whatever. But with cash assistance, there's no way of knowing in advance exactly how big that gap is going to be between income and rent because you don't know where they're renting, and so you can't know the rent. So tell us how you tackled that problem and what the results were in terms of how much money people were getting, generally speaking.

Vincent Reina 43:34
Yeah. So this is a really important dimension, not for just explaining the program, but also why this isn't like a universal basic income program or guaranteed income program. The guaranteed income programs, universal basic income programs have like a set dollar amount that everyone gets, and they're testing a dollar amount, which is a four. And there's a really interesting study, there's a lot of great work going on there. What this is, is this is assistance level, kind of a cash assistance determined based on your income level and rent levels. So in a city like Philadelphia, we follow these things called small area fair market rents, where essentially rents are calculated based on, and I'm sure this has come up at various points already in this series.

Shane Phillips 44:15
See episode 17 with Collinson.

Vincent Reina 44:18
And so, basically calculating vouchers at micro levels to account for the fact that rent isn't equal across the whole city, it varies by neighborhood. So the city of Philadelphia has three zones that this is the way they've done their small area fair market rent program, is they have a high cost area, high cost neighborhoods, medium cost neighborhoods, and low cost neighborhoods.

Shane Phillips 44:40
Oh, that's interesting. I thought the only way it operated was just at the zip code level.

Michael Lens 44:42
Yeah.

Vincent Reina 44:44
So yeah, you actually get a fair amount. So they've kind of merged zip codes into one of those three groups to essentially reduce the administrative burden on all ends. And it helps a little bit in a city like Philadelphia where there isn't as wide of variance in rents as some other markets, right? If you got to a place like LA and some other markets, the high is so high and the low can still be somewhat low, right? And so, not so much anymore, but all to say is that in Philadelphia, rents aren't as widely dispersed price-wise. So within that, those small area fair market rents set the kind of rent max. But then we know that someone's rental subsidy is based on the difference between 30% of their income towards the housing and what the rent is for that unit. So what we have is essentially like a variable dollar amount that everyone's receiving, right? Because our incomes vary. And not only do we live in different small area, FMR areas potentially, but also the unit we ultimately rent could be different or below any number below that small area fair market rent. So this is an interesting design feature and decision we had to make. In theory, we could just say everyone gets the difference. Everyone in the small area fair market rent is treated as essentially what the rent is for that area. So we actually looked at people's actual rent levels. And so, someone didn't get any arbitrage between their rent and the small area fair market rent. There are some models on direct rental assistance that are exploring whether to essentially allow households to capture that value. Ours did not because we wanted to follow the voucher program and its totality where in the voucher program, you essentially, your actual rent level is what determines the kind of maximum rent for the unit. So all to say is that in the cash program, there's a scenario where the median assistance payment to an individual is about $881. It's varied over time, $885, $880. But it kind of goes to some pretty extremes where there's essentially one household and where the assistance is upward of $2,000. That's an extreme outlier. And there's another few households whose payment is well below $500. And so, it's a variable subsidy amount to folks along the way, though we do have a very kind of dramatic clumping in the middle where that actual median is.

Shane Phillips 47:06
And I'm sure the same is true with vouchers as well where for some households, especially over time as their income changes, either the amount is going up a lot or going down a lot.

Vincent Reina 47:17
That's exactly right.

Shane Phillips 47:19
Hopefully more often going down as their incomes climb.

Michael Lens 44:20
Yeah.

Vincent Reina 47:21
Yeah. And that distribution we have for the voucher holders as well kind of holds fairly consistent, although funny enough in our sample, the voucher households somehow have slightly lower incomes, only slightly, and therefore slightly higher median assistance payments.

Shane Phillips 47:38
Well, thinking through the lease up process, I think a big question about cash assistance is how you deal with tenant screening requirements and I think particularly income requirements. It's not uncommon for landlords to require applicants to have a monthly income that's at least three times greater than rent. This is a number I hear a lot. And an extra, let's say $1,000 a month won't often be enough to get there for a lot of people to that three times multiple. And even if it is, the landlord might see from the income verification that this is not regular employment income, or maybe it hasn't even been showing up in the tenant's bank account because they're just enrolling in this program, so it's never shown up before. There's no way to show it other than with, you know, some evidence from the city. And in that case, it's easy to imagine the same discrimination experienced by voucher holders being duplicated here, and maybe even exacerbated because with cash assistance, the landlord doesn't have a guarantee that they'll receive the payments unlike with vouchers. So you know, these are all concerns you were well aware of, of course. So I'm curious how you thought about them and any solutions you devised or ways that you're working through this.

Vincent Reina 48:46
Yeah, and that's a really important point and one thing we wanted to learn about. Coming in, there was not like some full scale belief that a cash program is going to outperform the voucher program on every metric. It's that there are going to be clear trade offs that folks are going to make, right, or face. And we need to really understand both if those exist, then to what magnitude, right. And so one of the clear things in the voucher program is this idea of, you know, trying to help people not just lease a unit with a voucher, but essentially to move to neighborhoods with better performing schools, lower exposure to violent crime, all those kinds of things, right. And so with supports from the voucher program, but also maybe the confidence from an owner knowing the money is coming from the federal government, and it's going to come in on any given month, maybe that could increase the odds that you know, someone would be willing to lease to someone who seems lower income and therefore less able to pay. And so one of the things we're interested in is, you know, are there going to be kind of neighborhood opportunity trade offs, and that's one of the things long term we're actually looking at. But I think a couple realities came to the forefront for us, right. One is that but for some MTO agencies moving to opportunity agencies, leaning into really innovative approaches to thinking about security deposits and that kind of three month requirement. Voucher program on its own actually isn't equipped to address a lot of those things either, right. So folks are already kind of facing a lot of those natural market frictions when trying to use even conventional form of rental assistance. And there are some pilots that are kind of experimenting around that in really important ways.

Shane Phillips 50:22
Well, I do want to just interject here really quick, because I think the distinction here or one distinction is that with vouchers, you have to go through the whole inspection process. So there's no hiding the fact that you are using a voucher. And I think part of the appeal of cash assistance is the landlord doesn't need to know where your money is coming from, because like, they really don't.

Michael Lens 50:46
Yeah, source of income discrimination becomes, you know, kind of impossible, right.

Shane Phillips 50:51
And so I do think I bring this up just because I think that's sort of a selling point of cash assistance. But then there's this very real hurdle in that in that process.

Vincent Reina 51:02
Yep. No, that's exactly right. So one of the things we did is we offered all households actually got a letter saying their subsidy amount, right, that they can actually provide to a landlord on city letterhead if they so choose. The city actually in this program also is kind of shown a lot of commitment to administering the program. And so everyone in this program, they have an email address of someone at the city who answers within two hours, right, if not sooner. And with that,

Shane Phillips 51:29
I wish I could get that service.

Michael Lens 51:31
Yeah, I'm not aware of any city hotline with those kind of results.

Vincent Reina 51:37
Well, this is where like administrative burden comes in, right? If you don't have to spend all of your time like trying to get someone through 10 inspections to actually lease up a unit, you could actually use that time for other things, right? And so kind of thinking about where some of that time could be used differently in program administration is a really interesting component of this. But that said, the tenant can also essentially ask the city to even engage with the landlord directly if they so choose. So we gave them the option. Interestingly, very few people in our program have actually used that option, if any. It's literally like less than a handful. And I think the reality is that for a lot of folks, the ability to pay on day one with rent, with money, was potentially more beneficial to them than kind of the other assurances through a traditional voucher program for ensuring really fast, 100% lease up rates, right? And the flexibility, again, of what the unit actually can be, that also accelerates that component as well, right? You don't not only have to not have to go through an inspection, but you're again, making that choice as normal renters do about housing quality and other things. And so all to say is that, we found 100% uptake rate and housing rate from the program right away, which is a big kind of initial finding of difference versus the voucher program where it's more around the mid-70s in Philadelphia, right? So still fairly high compared to the national average. But overall, right, there's kind of that difference in lease up rate that we've seen already in our findings.

Shane Phillips 53:12
I could also imagine, even if you really did struggle to find a landlord who would rent to you, that you have this cash now. And so your options for finding a friend to stay with or a family member and to actually contribute something is much more substantial versus if you have a voucher, you can't use that to move in with a friend to take over their lease or something or pay your part of it. That's just not an option. So we've started to hint at some of the findings, but we're going to get into them fully here now. You used surveys, administrative data, and interviews to track outcomes for participants over the first two years with survey check-ins every six months. Let's start with the effect of direct cash assistance on two of the most catastrophic outcomes for low-income households, which are eviction and homelessness. So what did you find there?

Vincent Reina 54:07
So I would say one thing just to kind of go to what you just said. We've been very fortunate in that in these six-month surveys, they're very fairly long and exhaustive. And we've been able to maintain an 80-plus percent response rate on the whole over the course of our different survey rate waves, which has been really wonderful for being able to measure outcomes. And with these outcomes, with the survey, one of the things you're really able to do is kind of look at a broader set of measures. So for homelessness, clearly there's formal homelessness, which is kind of engagement with the homeless services systems. But there are a lot of forms of informal homelessness that exists for individuals, you know, staying with a friend or a family member for a night or multiple nights, sleeping in your car, sleeping in a hotel or motel. And so one of the things we do in this paper, in our study particularly, is hone in on the idea that homelessness is kind of a spectrum of potential forms it could take and not kind of discounting anything less than formal homelessness in a homeless shelter and the homeless system in some way, homelessness system, response system as not experiencing some form of homelessness. So when we construct these variables, similarly, right, an eviction, we know this formal evictions where someone actually goes through a court process, but we also know very well that there's a lot of informality and evictions where people are essentially forced out of their units. They're locked out. There's kind of different things that can go on. And so with that as well, we're able to ask a lot of nuanced questions about the forms of housing stability and instability, the duration and kind of look at these things in really nuanced ways. And that's one thing I think that's a real kind of power of the surveys in the long term also we have a lot of administrative data we're linking to that allows us to look at some of those traditional hard measures as well. And so what we're talking about here today is distinctly those survey based responses. So one of the things again, with this experimental design, and please stop me if I get too wonky, but we have these things called intent to treat and treatment on the treated. So with a voucher program, we know that there's a number of folks who can't use the voucher, but they're actually offered the voucher. So they're essentially received some form of treatment, even though they did not actually use the voucher in the end. And that's a really important part of the voucher story, right? We have a lot of research that focuses specifically on folks who are able to use a voucher. And there's a multitude of research showing the positive impacts, as you've discussed already, of vouchers on household outcomes. But to really understand the program, you need to also include the folks that are essentially falling out, right, and not able to use the benefit. And so with this in the study, what we find and test is kind of essentially cash, right, and we know 100% of our group were able to use it versus a control group who received no assistance. And for the voucher group, we're able to actually look at the folks who are offered a voucher, everyone who has offered it, regardless of whether they were able to use it or not, and looking at their outcomes relative to folks who are not offered a voucher, as well as folks who just were offered it and were able to use it relative to the actual kind of control group as well. So there's a lot of kind of nuance and levels in these findings. What we see off the bat, even from the first survey wave for the cash group, is just dramatic reductions in evictions. We see like over a third drop in evictions by the first wave for households. And that effect essentially actually increases over time. Similarly, for homelessness, we see a real dramatic drop initially for homelessness of the individuals. And this is accounting for all forms of homelessness, nearly 30% in the first wave. And then it grows from there in each successive wave as well.

Shane Phillips 58:01
To a bigger reduction.

Vincent Reina 58:04
To a bigger reduction. Exactly.

Shane Phillips 58:06
And this is for the cash recipients compared to the control group of people who did not receive any. They were just still on the wait list.

Vincent Reina 58:12
Exactly. Exactly. And so we're seeing, you know, what's really powerful here, right, is that at the end of the day, this is a program where we're telling folks, this is a housing assistance program, but we're not doing any check to say, did you pay your rent? Show me a rent stub, right? We're not giving it to the owner. We're giving it to the tenant and saying, this is the intent of the program. And what we're seeing ultimately is the outcomes we care about the most, which is the housing stability ones, right, for eviction homelessness going down dramatically, both initially and then kind of maintaining and growing over the course essentially of the program itself. Importantly, right. We don't want to create some like one is better than the other of cash first vouchers. I think there's a lot of multidimensionality of here of who a subsidy could be better for at what point, you know, and we shouldn't ever treat these programs as a binary either or because as we know, housing markets are complex and people's needs are also complex. But we find actually interestingly enough for eviction homelessness, especially compared to that group, the intent to treat group, which is just the folks offered the voucher, some of whom essentially were not able to use it and some were, we're finding kind of larger coefficient sizes for the cash group relative to the control group than we are finding for the voucher group relative to the control group. That said, a really positive story here is vouchers also work really well, right? They are also dramatically reducing homelessness and evictions as well. And so, they're both working really well, although in some respects, we're seeing larger coefficient sizes and effect sizes for the cash group relative to the control group for homelessness and eviction.

Michael Lens 59:54
Yeah. And as you know, one type of assistance might work better for one set of families or people with particular needs and one set of assistance might work better for others.

Shane Phillips 1:00:06
That's the follow-up study.

Michael Lens 1:00:07
Yeah. Yeah. The galaxy brain policy will be like being able to kind of triage those people into different buckets, but we're not at that point. That's all extremely promising. Another thing that I think that you were able to look at and that people would have questions about are serious housing quality concerns, right? You asked people to report on things like fire or water damage, extreme heat or cold, broken doors or locks, no functioning fridge or stove and things like that. And as we've noted, I think people would be potentially concerned that without an inspection the cash assistance group might not fare as well. What were some of the results that you guys found?

Vincent Reina 1:00:49
Yeah. So there again, importantly across both groups, cash relative to control group and voucher relative to control group, we find positive improvements on housing quality, right? Again, these are self-reported, but kind of multiple dimensions as you just mentioned with the cash group, particularly their first move to a new unit, we actually see essentially like a 21% improvement in their overall self-reported housing quality or reduce odds of reporting some of these bad housing quality standards. We are finding a bigger effect size for the voucher group. And that means that for folks who are able to use a voucher, there could actually be a benefit to that inspection and seeing actual larger coefficient housing quality improvement than the treatment group. But again, they're really important that they're both directionally and by size really important improvements in housing quality, but we are seeing a larger coefficient for the voucher group, which is theoretically what we would expect if those inspections were working. Right?

Shane Phillips 1:01:54
Yeah. So it is good to know that the inspections are doing something. It's not just an administrative burden, a bureaucratic hurdle that is contributing nothing at all.

Vincent Reina 1:02:03
That's right. This is why it's really important to think about some of this stuff because it's a series of trade-offs. We often do this thing where we evaluate housing programs based on one outcome, but folks are trading off a broader set of outcomes and some are placing higher premiums on certain outcomes than others. And so here, one program could work a lot better in one setting for one outcome and in another setting for another outcome. And those are the real kind of trade-offs as we think about it. And that's where I think going forward, I mean, I'd like to think we have many papers that are going to come out of this across a whole set of outcomes. We're linking the school data, medical records, there's a lot more we can go into on the housing side. We focus just on households with kids for this study and lots of kids' outcomes that are also going to be at the forefront. I should say, and I should have said this all along from the get-go, my colleague, Sarah Jaffee, who's in the School of Arts and Sciences in the Department of Psychology is the other lead investigator on this project. She is just the most amazing colleague and is co-leading all of this work with me. So I should have said her name from the first breath. So apologize for that, Sarah. Way more to come here. And I think though really understanding those trade-offs is something we're both particularly excited about going forward.

Shane Phillips 1:03:20
Yeah. And I don't want to come across as downplaying housing quality at all because no one should. But I do think the reality is, as you said, the vast majority of people who are eligible for housing vouchers do not receive any because we just don't have enough funding for them. And those people are not getting these inspections and they're not getting money. So lots of people are living in these homes and making these decisions about making these trade-offs and deciding to be able to get into a house, to be able to get into this neighborhood or something about this specific house despite the concerns I might have on specific things, I'm willing to make that choice again. I think there is just a level of trusting people to understand what is in their best interest. You still want standards. I feel like this is where having a more proactive building inspection program independent of a voucher program can really help where you can just ensure that the housing quality across the board is more up to snuff because why should this be something that is limited to people who have vouchers anyway? Everyone should be able to live in housing without serious problems like these. And so conditioning these inspections only on these vouchers, I understand it's just a matter of resources at the end of the day and priorities. But I think that's probably a better vision for this is people can choose the housing they want, but then it is the city's role, it's some government entity's role to inspect all housing and make sure it's meeting these minimum standards.

Michael Lens 1:04:52
Yeah. In 1949, the federal government promised us a decent home and a suitable living environment. Isn't that right? So we're still not there yet.

Shane Phillips 1:05:01
And to be clear, I'm not saying the government should be inspecting every unit before someone moves in. Landlords, you can back off. I'm just saying a more consistent, I mean, in Los Angeles, they do it about every four years is I think their target. And they just kind of let you know about a month in advance and show up and look through and it takes 10 or 15 minutes.

Vincent Reina 1:05:21
That's exactly right. And ultimately at the end of the day, to make programs that work well or if nothing else prevents some catastrophic scenario that no one wants in the news, we oftentimes create higher standards than exist in the current market. And by virtue of doing that, it creates just a level of administrative burden that maybe is warranted and justified and it sounds good and could be really great, but we need to acknowledge is different than what the market's being asked to do on its own. Right?

Shane Phillips 1:05:52
Yeah. Yeah. Well, I had a question here about lease up, but that's kind of silly because it's 100% as you say, everyone gets their money anyway, with this program, they don't have to find a landlord to accept it. So we can skip to the end because we're running out of time here anyway, but I just want to wrap up and ask you if there are any big picture takeaways from PHL Housing Plus at the end of two years and really has the program, it sounds like it's shown enough promise to keep going and expand and try new things, but I guess other than whatever big takeaways you have, I'm curious if there were any unexpected benefits or unintended negative consequences that you came across, whether in the quantitative data or just in these interviews and surveys with people. Were there any surprises?

Vincent Reina 1:06:40
Yeah. So I guess kind of multiple things to think about here. One, again, realizing I'm remiss to acknowledge Matt Fowle, who is a researcher at my center, who's done, at the end of the day, all of the data crunching for us on this, and Mimi Tansky, who's on our research team as well, and without her, that response rate would not exist amongst many other things she's done. But I think one of the clear takeaways here is not even related to housing, right? It's just more generally acknowledging that as researchers, we really can be strong partners to city officials who want to think creatively about solutions. Rachel Mulgrey and Miranda Onbury were amazing partners at the city, and one of the things that we did early on is we established the trust with each other and rapport that was about building a program, building evidence, but also kind of seeing each other as colleagues in a team. And I think at the end of the day, pilots like this don't get created or evaluated without real kind of meaningful partnership, which we've kept doing, right, and has actually led to, the city's actually about to announce that it's extending the program and the pilot for another year. Oh, that's great. So a three-year turns now into a four-year pilot, right, which is really wonderful. And part of that is a product of a lot of our collaboration and the fact that we were able to kind of take early lessons learned and present it to them so they could do real-time policymaking and speak to local officials about things like budgets, right, and how to actually fund the program and why you should fund the program. So I think one of the real learning opportunities through all this is that policy actually can be kind of reflective and responsive, but also still adhering to a research design. And those don't have to be in opposition with each other. I think another thing that just is really kind of striking to me is just, I think this is like the age-old academic story of like, we think we know so much and we still have so much yet to learn, right? So much yet to learn about the way rental markets work, the way tenants are engaging with it and using subsidies, the trade-offs that households are making, the way that owners and tenants are engaging with each other. And I think we have a lot of really powerful insights that are going to be coming out from a lot of our qualitative work, a lot of our interviews and other stuff that I think is really going to show a lot of that nuance, which I think we know that, for instance, vouchers work well, but there's a lot that happens while someone's receiving a voucher that actually is kind of intermediating the effect of the voucher, right? And we need to actually know those things and understand them. And so I'm really excited about what's yet to come from what we've collected.

Shane Phillips 1:09:14
Well, that is exciting to hear that you get to keep studying this for another year because I'm sure that extra year will make a big difference. And hopefully, these programs can expand to more cities, including ours down here in Los Angeles. So Vincent Reina, thank you for joining us on the Housing Voice podcast. Really appreciate it.

Vincent Reina 1:09:32
Really fun. Thanks for having me. And make sure to come to Philly. You promised now.

Shane Phillips 1:09:36
Soon as possible, after summer. You can find a link to Vincent's work on our website, lewis.ucla.edu. Show notes and a transcript of the interview are there too. The UCLA Lewis Center is on the socials. I'm on Bluesky at ShaneDPhillips, and Mike is there at mc-lens. Thanks for listening. We'll see you next time.