RENT VOUCHERS: BETTER HOUSING, MORE BANG
FOR THE TAXPAYER'S BUCK, SAYS LONGTIME RESEARCHER

	Housing vouchers may get much more attention in a new era of
a Republican-controlled Congress and center-seeking White House,
although vouchers have been discussed for years as a substitute for
public housing and privately owned units built with tax subsidies.

	It's about time, says a University of Virginia economist who
since the late 1960s has been studying housing vouchers and
advocating the "reinventing" of HUD and major changes in federal
policies on shelter for low-income families and the homeless.

	Edgar O. Olsen, chair of the Department of Economics at
U.Va., who has served as a consultant to HUD, the World Bank and
other agencies, says the current system of subsidized housing is
seriously flawed for reasons including:

	¥ "Assistance does not reach most of the neediest
households, most visibly the homeless."

	¥ "The system is grossly inequitable in that we provide
large subsidies to some households while offering no assistance to
the majority of similarly situated households."

	¥ "We pay much more than is needed to obtain the housing
that is occupied by subsidized households under most of the
programs."

	All of these problems can be solved without spending more
money, says Olsen, because waste is rampant in the current system.
Five major studies were unanimous in finding that it costs "more
than a dollar to provide a dollar's worth of housing ... even when
administrative costs are ignored," he notes. Olsen says the average
estimate was that 20 cents of every government dollar is wasted.

	Olsen advocates issuing vouchers to families according to
their need, with the poorest households getting the largest
subsidies and those with marginal incomes receiving modest
supplements. Huge savings from the elimination of construction and
maintenance costs for public housing will pay for the vouchers and
give families a chance to shop for better housing, he says.

	What would happen to the least desirable projects, the huge
and dangerous public housing complexes in major urban areas? They'd
be abandoned -- and should be, Olsen argues.

	Edgar Olsen may be reached at (804) 924-3443.


March 6, 1995