ARI SHAPIRO, HOST:
The partial government shutdown has put many low-income renters and their landlords on edge, and here's why - they rely on money from the Department of Housing and Urban Development that amounts to subsidies. But HUD told property owners that they won't be getting that money during the shutdown, and they should use their own funds to compensate. With no end in sight, housing advocates say hundreds of thousands of Americans face the risk of being evicted from their homes. NPR's Brakkton Booker reports.
BRAKKTON BOOKER, BYLINE: HUD has more than 20,000 contracts with owners of multifamily housing developments. When it comes to payments, HUD is typically reliable. This is how it usually works. The property owner houses multiple low and very low income residents, charges them modest rents, and HUD kicks in subsidies to make up the difference. But at the start of the new year, HUD said roughly 1,150 property contracts were not renewed as a result of the shutdown. And that has Diane Yentel very concerned.
DIANE YENTEL: Funding these contracts is necessary to keep about 150,000 deeply poor, mostly seniors and people with disabilities, safely and affordably housed.
BOOKER: Yentel is the president and CEO of the National Low Income Housing Coalition. She worries that with President Trump and congressional Democrats at an impasse over border wall funding, the government won't open anytime soon.
YENTEL: And eventually, these owners will have to resort to either really significant rent hikes or evictions of these lowest income renters.
BOOKER: HUD says the vast majority of project-based rental assistance projects are funded through February, but acknowledges, as the shutdown continues, more contracts will expire. Eric Johnson is the executive director of the Oakland Housing Authority. He works with two properties in the region, one in San Jose and the other in Sacramento, with about 75 housing units between them. He says neither got a January payment from HUD.
ERIC JOHNSON: And so they're functioning right now without having really any income from the program to help support their efforts.
BOOKER: HUD is asking these and other owners to dip into the reserve accounts to cover any money that HUD is unable to release. Johnson adds, many property owners won't be able to operate indefinitely from their reserve funds. This puts owners of low-income housing units between a rock and a hard place. Johnson says that's bad for the stability of the housing market overall.
JOHNSON: I'm more concerned about them ending up going into foreclosure and bankruptcy on these properties than I am really about them evicting residents.
MARY CUNNINGHAM: I think that's right. I think this shutdown sends a very dangerous message to landlords, which is the government doesn't pay its bills.
BOOKER: That's Mary Cunningham, a housing expert at the Urban Institute. She says if landlords can't make up the shortfalls and residents are unable to turn to the government for help, there won't be many options for low-income tenants.
CUNNINGHAM: And they'll be turning to family and friends, but also homeless shelters, living outside.
BOOKER: Officials say, after past shutdowns, property owners have always been reimbursed. HUD adds they've had no tenant evictions due to funding interruptions. But we're in uncharted territory here. Starting tomorrow, this shutdown will be the longest in U.S. history. Some 500 HUD agreements will end by January and another 550 next month. Brakkton Booker, NPR News, Washington.