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On Your Side investigation finds Section 8 tenants with high incomes

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MEMPHIS, Tenn. --  The On Your Side investigators discovered new details about a program you're paying for.

WREG uncovered high incomes in housing meant for low income residents.

We asked those in charge of the program for an explanation of why you're footing the bill for some folks that could pay their own.

"Just the thought of people who are making this type of money, that's greedy," said Michael Bates.

Bates, who was on the waiting list for the Housing Choice Voucher Program, made that comment after we showed him a list with the incomes for people on the HCV or Section 8 program in Memphis.

The On Your Side Investigators found the rental assistance designed for low income residents was also benefiting people with much higher incomes.

It was shocking figures, even to folks familiar with the program.

WREG showed the same data to HUD's Memphis Field Officer John Gemmill.

"Those incomes are for the most part double the income of those areas," Gemmill responded.

"I'd be surprised at what's going on with a household earning $71,000 a year that folks feel they're eligible for vouchers," said Tennessee Housing Development Agency Executive Director Ralph Perrey.

THDA also administered vouchers for lots of rural counties in Tennessee.

Bates applied for a voucher several years ago, then received a letter from the Memphis Housing Authority in 2013.

"I received a letter about two years ago saying that I was going to be put on the waiting list," he said.

The letter went on to state that when his name reached the top of the list, he'd be contacted.

WREG found there were approximately 7,000 people with vouchers in Memphis.

However, there were 8,000 names on the waiting list that's currently closed.

"There is limited funding from HUD for the HCV program," said Cheiktha Dowers-Scott who ran the MHA.

Dowers-Scott said  it's been years since HUD's funded new vouchers.

"So we only address new admission through attrition or turnover," she continued.

Which we were told was also rare.

"It's very rare, within the past year, we've only had approximately 600 individuals to leave," added Dowers-Scott.

Memphians on Section 8, spent, on average, eight years in the program.

Although for some, it was much longer.

This meant every spot, was in high demand.

The Housing Choice Voucher Program was created in the 1970s.

Unlike public housing, tenants can choose where they'd like to live.

The rent subsidy paid by the government was based on 30% of the family's income.

The less you make, the higher the subsidy.

Income was also used for admission.

According to HUD regulations, in general, a family's income may not exceed 50% of the area's median income.

In 2015, that figure was $58,000 for Shelby County.

Therefore, a family would have had to make $29,000 or less to qualify.

However, that limit fluctuated based on family size and other guidelines.

See 2015 income guidelines

"The program is actually intended to serve very, low income families," Dowers-Scott told WREG.

In fact, by law public housing authorities must provide 75% of its vouchers to applicants with the lowest incomes (income cannot exceed 30% of median area income).

In Memphis, the overwhelming majority of the vouchers went to tenants of modest means.

Through open records requests, WREG obtained income and demographic information for Section 8 and Public Housing units in Memphis and other cities across the country.

A summary provided by MHA revealed the majority of tenants fell into the income category of making $8,000 to $15,999 annually.

Out of 7038 units, 3005 belonged to families in that category.

That's followed by 1510 units who made between $16,000 to 27,999 and another 1487 at $0 to $7,999.

However, the On Your Side Investigators found people with much higher incomes who continued to get assistance.

The summary showed 360 tenants made above $28,000.

WREG examined  a much larger file of all HCV program income, by zip code in Memphis.

According to MHA, the file we obtained includes all incomes (head of household, dependents, etc) for every unit.

In one Memphis neighborhood, a Section 8 tenant reported income of $71,795.

In two other zip codes, 38125 and 38118, there were incomes reported at more than $64,000.

There were also a few at or around $55,000.

In all, we counted 192 lines above $30,000.

Nashville and Knoxville refused to turn over their records, citing privacy concerns.

Nashville did provide documents that showed the amounts tenants paid, and in come cases, there were tenants paying more than $1,000 in rent.

That means those people also had higher incomes.

Housing authorities in St.Louis and Atlanta also provided WREG with tenant income by zip code.

Like Memphis, we found some people making more than $60,000 in both cities.

"The housing choice voucher is only required to determine whether a family is income eligible at new admission. After a family is admitted, income limits don't apply," explained Dowers-Scott.

So once people were in the program, they could make more money and stay.

However, tenants must re-certify each year and if there's a change which allowed them to pay all of their rent, and the housing authority hasn't paid any of their rent for six months, Dowers-Scott said, "We remove that family from the program."

WREG asked further, "How is somebody that makes $70,000, how can they not afford to pay all of their rent?"

Dowers-Scott replied, "You have to understand, every family may have special circumstances."

Specifically, a family's income was "adjusted" based on several factors including, number of dependents, child care and even medical payments for those who are disabled.

Housing authorities then used the "monthly adjusted income" to calculate the rent subsidy and total tenant payment.

(Income can be derived from multiple sources: employment, TANF, Food Stamps, Social Security, etc.)

Dowers-Scott said those with higher incomes, usually had larger families and lots of deductions, which reduced their actual income.

In addition, when tenants received a new job, their portion of the rent was gradually increased, a move meant to encourage employment.

Bates said he understood, and wouldn't want anyone bumped simply to secure a spot, but he said, when possible, people should move on.

"If you are blessed enough to make this as a salary, a year, you would turn down a voucher and go, and be able to find you somewhere, because you should be able to afford this, and let the vouchers go to those who cannot afford it," he said.

Overall, everyone WREG spoke with said more funding was needed to get more people in the voucher program.

Section 8 Demographics by Zip