Applicants must meet certain maximum income limitations in order to be eligible for emergency rental assistance. An applicant's stated income can be reasonably confirmed by cross-checking the factual information provided in the application against statistical data resources. As indicated in FAQ #4:
A grantee may rely on a written attestation from the applicant as to household income if the grantee also uses any reasonable fact-specific proxy for household income, such as reliance on data regarding average incomes in the household's geographic area.
Grantees can reasonably confirm an applicant’s stated income by cross-checking the factual information provided in the application against statistical data resources. Relying on these resources can simplify the application process, reduce processing time, and ensure more households avoid eviction and housing instability.
Advantages to using this practice
Simplifies the application process and reduces the burden on low-income applicants
If a program has the ability to customize their online application, they can use the address information provided by an applicant to qualify the applicant via the proxy and present self-attestation as a first option, instead of requesting documentation and then falling-back to self-attestation.
Reduces application processing time
Increase in assistance distributed by Kentucky Housing Corporation from September to October 2021.
The Kentucky Housing Corporation was able to clear a significant backlog of applications that lacked complete income documentation by approving applications using the fact-specific proxy approach, thereby increasing their total monthly assistance provided for households from $9,784,364 in September to $18,296,443 in October, a 87% increase. Subsequent research has shown that streamlining income verification for application processors in Kentucky increased application approval rates by at least 7 percentage points.
Grantees such as Indiana and Washington State are integrating proxies into their application processing workflows so that application processors will see that a grantee is from a qualified area and can skip follow-ups on income documentation. This has cut down on application processing time and the back-and-forth involved with following up with applicants to get specific documents.
Steps to take
To develop and use an income proxy, a grantee will need to do the following:
Determine a reasonable geographic area (e.g., census tract, ZIP code, districts, etc.)
Many grantees, such as Virginia, Washington, and Kentucky, have built their proxies around ZIP Codes. Most of these grantees are using census-tract level data to derive facts at the level of ZIP Codes, and then use ZIP-Code-level data as a part of their application review process to simplify deployment.
In Kentucky, in instances where a ZIP Code spans two or more counties, the ZIP Code was associated with the county in which a majority of the ZIP Code’s population lives.
Grantees such as Maricopa County have built systems that allow them to use census tract and block data directly, which offers greater granularity than ZIP Codes.
Find data sources that offer population-level income data for your geographic area
Grantees such as Kentucky and Washington rely on census data from tables such as B19013 for median area incomes at the census-tract or ZIP Code-Tabulation-Area level.
The state of Indiana is partnering with local utility companies to obtain data about utility arrears, which they combine with HUD Qualified Census Tracts to determine income eligibility (via the qualified census tracts) and acute need (via the arrears data).
The state of Oregon is using 5-Year American Community Survey (ACS) data from the U.S. Census Bureau. When possible, their proxy evaluates median renter household income, rather than the median income of all households in the ZIP Code. When there is no estimate for median renter income in the ACS data, they use the median income of all households.
Implement a technique for looking up addresses of applicants within your defined geographic areas
In Phoenix, AZ the Maricopa Association of Governments designed a census block map specifically to identify census blocks with high needs. The map allows a case worker to look up an address and determine if that address sits within a Census Block Group where 60% or more of the population is below 80% AMI of Maricopa County.
Integrate your new fact-specific proxy with your system to help determine applicant eligibility
In Virginia, the Department of Housing and Community Development has published a simple PDF of ZIP codes that an application processor can use to determine that a 3-person household is income eligible for assistance.
Grantees have noted the importance of training staff on how to use a proxy to determine income eligibility, to build in a feedback mechanism from staff to program administrators, and to continuously refine the use of the proxy as the program evolves. In Kentucky, the program started using a fact-specific income proxy as a backup option for determining income eligibility and, after a month of monitoring, expanded the use of the proxy to be a primary method of determining income eligibility.
More detailed illustrations of these steps are available in "Guidelines for fact-specific proxies".
Many grantees are using an applicants' participation in other government programs with similar income eligibility criteria as proxy. As defined in FAQ #4, "grantees are permitted to rely on a determination letter from the government agency that verified the applicant's household income or status as a low-income family, provided that the determination for such program was made on or after January 1, 2020." The government programs include but are not limited to:
- Head Start Childhood Education Program
- Public Housing or Section 8 (housing choice vouchers or project-based)
- Social Security Disability Insurance (SSDI)
- Supplemental Nutrition Assistance Program (SNAP)
- Supplemental Security Income (SSI)
- Temporary Assistance for Needy Families (TANF)
Using both income and categorical eligibility proxies
If you have successfully implemented one form of proxy in your program, you may consider implementing another type of proxy. Having multiple proxies may increase your ability to reach those in need.
Program flexibilities and prioritization
A proxy allows a grantee to customize their program to make use of flexibilities and different prioritization strategies. Many programs are using a proxy in conjunction with self-attestation. In Phoenix, AZ the program decided that any applicant with income below 50% AMI would be automatically eligible for future rent payments of up to 3 months. In Philadelphia, PA the program has coupled self-attestation with a calculation to determine if an applicant is paying more than 30% of their income in rent to help ascertain housing instability and as one of several inputs to application prioritization.
A proxy eases several burdens for programs and applicants, and it also opens up new opportunities to improve program integrity and equity. When designing a proxy, consider pulling in additional data about:
- Estimated number of renters in a given area
- Poverty rate in an area
- Median rents in an area
- Housing instability in an area
- Other signs of acute financial distress, such as Indiana’s utility arrearage data
By using these additional data points as metrics to track applications against, programs can become aware of potential fraud by noting an increase in applications coming from an area with few renters or seeing rents well above the expected range based on statistics in the area.
Grantees who have implemented proxies may consider these practices to continuously improve their usage.
Track how your proxy affects your program across multiple dimensions
Key questions to track include:
- How is application processing time affected?
- Is money flowing to the places with the highest need?
- Are you serving more households without increasing program administrative burden?
Track your own metrics and feed your data back into your proxy
As a program matures, it will have a wide source of data about what rents are in an area, what incomes are, and other data similar to what programs derive from census data. Analyzing collected and verified data through the application adjudication process can offer yet another source of data for a proxy and for program improvement overall.
How it connects to your program's health
The use of a fact-specific proxy for purposes of supporting the determination of applicants' income eligibility is a strongly encouraged practice noted in the Program Improvement Plan. Especially for programs not using self-attestation yet, a proxy can provide an additional factor in determining household eligibility that should increase the rate of assistance being provided.