THE GOVERNMENT'S subsidized housing programs, while costly -- housing is costly -- are enough to help only about a fourth of the renting poor. The result is that nearly half of poor renters are forced to pay more than 70 percent of their already paltry incomes for shelter. It more than any other is the cost that breaks them.
The right solution would be to limit the mortgage interest deduction, the housing subsidy that rises with income, and shift the proceeds, which could be substantial, to the poor. That isn't going to happen anytime soon. The housing bill the 101st Congress passed instead was celebrated as a sign that the policy stalemate of the Reagan years had ended. It was that, but it was also fairly conventional and limited legislation.
A compromise was found to keep in the subsidized housing inventory several hundred thousand units -- about one in 15 -- on which the original contracts are expiring and that were in danger of being lost. The owners will be offered inducements to stay in the program and, if these don't suffice, will in most cases be bought out.
Atop that defensive step, the housing certificate and/or voucher programs, which account for the bulk of the inventory, will also continue to be expanded, though at little more than the slow pace of the Reagan years. These are programs in which the government mainly doesn't own or build units but pays the difference between the fair market rents and what the tenants can afford.
Finally, a new aid spigot has been added, promising but limited -- a block grant to the states, to which they and the assisted local jurisdictions would then be expected to add. State and local authorities would have more discretion and flexibility in the use of the funds than under most past federal programs, which may be a healthy shift. At the same time the administration, in theory in favor of state and local flexibility, added limits on how much of the new money can be spent on either the non-poor (in mixed-income housing) or costly new construction; that amber regulatory light may be useful as well.
The bill also authorizes funds to help tenants in subsidized housing buy their units, a favorite idea of housing Secretary Jack Kemp. But all the expansions of aid are authorizations only. Funding is subject to the appropriations process under terms of the budget agreement just worked out between the administration and Congress; for the next three years especially, the housing programs will have to compete for a limited pool of funds and will only be able to expand at the expense of rival programs, which in housing's case include programs for veterans, environmental protection and space.
Some major programs for the poor are under the control of the congressional tax committees, which can fund expansions. Housing is one of the exceptions; while costly, it lacks a source of funds, and again in the new bill the mismatch shows.