The Olmstead Decision and Housing:  Opportunity Knocks

Olmstead v. L.C. and E.W. 

Both of the Olmstead plaintiffs – identified as L.C. and E.W. to protect their privacy – were diagnosed with mental retardation and mental illness.  Both women voluntarily admitted themselves to Georgia’s state mental hospitals.  After a period of time, they and their treatment team decided that they were ready for “community-based care.”  Unfortunately, they remained in the state hospital because Georgia had no available community-based housing or services for them and no funding to generate more housing and community services to accommodate them. 

E.W. and L.C. based their lawsuit on the ADA.  They argued that the ADA required Georgia to administer its mental health program “in the most integrated setting appropriate to the needs of qualified individuals with disabilities.”  Georgia argued that its continued hospitalization of the plaintiffs was the result of a funding decision, not a decision to discriminate.  The Supreme Court rejected the State’s argument, and interpreted the ADA to mean that states could not legally require people with disabilities to remain institutionalized in order to receive health care services. 

The Court explained that unjustified isolation was a form of discrimination.  It reflected two judgments: 

“First, institutional placement of persons who can handle and benefit from community settings perpetuates unwarranted assumptions that persons so isolated are incapable or unworthy of participating in community life....Second, confinement in an institution severely diminishes the everyday life activities of individuals, including family relations, social contacts, work options, economic independence, educational advancement, and cultural enrichment.” 

Nonetheless, the Supreme Court was careful to say that the responsibility of states to provide health care in the community was “not boundless.”   States were not required to close institutions nor were they to use homeless shelters as community placements.  Without imposing specific requirements, the Court said that if “…the state were to demonstrate that it had a comprehensive, effectively working plan for placing qualified persons with mental disabilities in less restrictive settings, and a waiting list that moved at a reasonable pace not controlled by the state’s endeavors to keep its institutions fully populated, the reasonable modifications standard [of the ADA] would be met.”

The Court also defined the standards for states to follow in releasing people from institutions.  The state’s treatment professionals must determine that the placement is appropriate; the individual must not object to being released from the institution; and the state is able to provide a community placement and services without displacing others on a waiting list for similar benefits and without unduly burdening the state’s resources.

As a result of their lawsuit, L.C. and E.W. are now living in the community with foster families.  Each is receiving health and support services through the Medicaid program.  According to their lawyers, both are very happy, are enjoying their new homes, and are engaged in community programs that had previously been unavailable to them.  

As a result of the Olmstead decision, states are reviewing whether current policies and practices in their health care and service delivery systems are in compliance with the ADA.  Where people with disabilities will live, and how their housing will be made affordable, are topics which should be included in these discussions.  It is also the right time to include government housing agencies, and the programs they administer, within these Olmstead planning activities. 

HHS Actions 

Olmstead is a case about de-institutionalization.  Not surprisingly, the majority of commentators and public officials have discussed it in terms of a state’s responsibility to provide long-term health services to people with disabilities.  Two agencies within HHS – specifically the Health Care Finance Administration (HCFA) that administers the Medicaid program for the federal government and the Office for Civil Rights (OCR) – are responsible for providing information and guidance to the states on how to comply with the ADA mandates in Olmstead. 

On January 14, 2000, HHS sent a letter to every state governor citing Olmstead as affirming the “shared belief that no person should have to live in a nursing home or other institution if he or she can live in his or her community.”  The letter encouraged the governors to develop and implement the kinds of comprehensive working plans that the Court had suggested, “[to ensure] that individuals with disabilities receive services in the most integrated setting appropriate to their needs.”   

Letters were also sent to state Medicaid directors encouraging them to work together with the state human service agencies towards the shared goal of integrating individuals with disabilities into the social mainstream, promoting equality of opportunity and maximizing individual choice.  HHS has also issued numerous policy clarifications designed to help Medicaid beneficiaries transition to “less restrictive settings” and expedite Medicaid funding for community-based services. 

Housing Implications – Where will people live? 

Where does housing fit into the state planning activities that may occur as a result of the Olmstead decision?  Thus far, the housing issues implicit in the Olmstead decision have received very little attention.  For example, HHS guidance to States does not address where people will live.  However, the term “less restrictive setting” usually means some kind of community-based housing option linked with Medicaid or other publicly funded supportive services. 

In the 1970s and 1980s, efforts to reduce the number of people with disabilities living in institutions produced the first community-based housing programs for people with disabilities.  For the most part, these housing options did not resemble the types of conventional housing (i.e., apartments, small single family homes) that non-disabled people live in.  Instead, they were large congregate settings with a “package” of support services that, in some instances, residents were required to accept in order to live there.  People were usually required to share a bedroom with others, were not given rights of tenancy under landlord/tenant laws, and were typically required to pay all but $30 or $40 per month of their SSI benefits to live in these types of residential settings.  It can be argued that people with disabilities living in some of these arrangements were still segregated from – rather than fully integrated into – community life. 

Fortunately, people with disabilities now have more choice in where they live, who they live with, and the services they will receive.  These changes came about because of: the advocacy of people with disabilities, their families and service providers; the use of innovative Medicaid policies; and new federal fair housing laws which made it illegal to discriminate against people with disabilities seeking housing in the community.  During the past decade, “community-based housing” for people with disabilities has been redefined and now means rental and homeownership options linked with voluntary services and supports. 

Housing Affordability and Policy Implications 

HHS’s Olmstead planning guidance also does not address how housing for people with disabilities moving into the community will be funded.  Because of the extremely low incomes of people with disabilities, they have increasingly relied on government housing programs – particularly the programs provided through HUD – to obtain decent and affordable housing.  At this time, there is no guidance from the federal government summarizing how federal housing policies and programs might intersect with the need to expand community-based housing options for people with disabilities leaving institutions. 

To disability housing advocates, the Olmstead decision clearly has potential implications for federal, state, and local government housing policies.  Most people with disabilities affected by the Olmstead decision will be receiving SSI benefits – which nationally are equal to only 24 percent of median income.  TAC’s Priced Out in 1998 study confirmed that people with disabilities receiving SSI couldn’t afford decent and safe housing in any housing market area in the country without government housing assistance.  Because of their low incomes, all SSI recipients are income eligible for HUD’s housing programs. 

Unfortunately, the housing needs of people with disabilities have not been a top priority for HUD, nor are they a top priority for most state and local housing officials that distribute HUD funds.  A recent TAC report titled Going It Alone: The Struggle to Expand Affordable Housing for People with Disabilities documents the poor track record of government housing officials and their failure to target federal housing funding to people with disabilities.   In a few states, housing advocates for people with disabilities are beginning to overcome the institutional barriers separating government housing and human services agencies.  However, for the most part, the disability community has not been able to sustain successful working partnerships with federal, state, and local housing officials. 

Housing Not Mentioned 

The question of whether states will see new opportunities within the Olmstead decision to target more federal and state government housing funding for people with disabilities has yet to be answered.  It is very possible that without a significant investment of government housing funding, the “community based settings” developed as a response to the Olmstead decision will resemble outdated models from the past rather than the rental and homeownership strategies that have been successful during the past few years. 

Of the 22 Olmstead-related plans that states have sent thus far to HHS for review, not a single one mentions housing.  None of the state plans reflect discussions or partnerships with state housing or community development departments.  As of September 2000, none of the committees formed, Executive Orders issued, or legislation enacted by states in response to Olmstead mentions housing or includes housing officials or experts. 

On the bright side, the majority of states have begun to take some action as a result of the Olmstead decision.  Many states are developing Olmstead -related plans.  A few states have Executive Orders or legislative resolutions requiring that a plan be developed by a certain date.  Nine states thus far have declared that their programs are adequate to meet the Olmstead test and that no new action is necessary. 

The Importance of Affordable Housing and Olmstead 

Some legal advocates suggest there are mandates within federal housing policies that could require some direct linkage between federal housing resources and Olmstead-related activities.  Others aren’t so sure.  However, the housing issues raised by Olmstead do create an important new opportunity to engage federal, state, and local government housing officials in Olmstead-related planning discussions.  These officials control billions of dollars of new federal funding which could be used to expand affordable housing for people with disabilities who may be moving into the community as a result of the Supreme Court’s decision. 

Unfortunately, because there are millions of low-income households in need of housing assistance, the demand for federal housing funds is much greater than current funding levels.  Since 1980, the federal government has reduced funding for housing programs, while the number of low-income families has grown.  For example, between 1985 and 1995, such families increased by 2 million.  In contrast, affordable housing units increased by only 700,000.  People with disabilities – particularly those people with severe disabilities whose monthly SSI benefits are only $512 a month – have been the most severely affected by this housing crisis. 

To what extent will the housing needs of people with disabilities – including those potentially affected by the Olmstead decision – be given a priority by government housing officials who control affordable housing resources?  Most government housing officials are very uninformed about the housing needs of people with disabilities and, as mentioned earlier, don’t consider their housing needs a high priority.   They also lack good information about the fair housing and civil rights laws that protect people with disabilities – including the Olmstead decision and its potential relevance to future government housing policies. 

Housing Officials Not Involved

Housing officials’ lack of involvement in Olmstead-related planning activities is not surprising.  Very few state health and human services agencies are engaged in affordable housing planning with their state housing agency.  State and local housing agencies have virtually no knowledge or information about the Olmstead decision.  Even in states with a history of housing and service agency partnerships, the partnerships typically do not include state Medicaid officials.  Without help from the housing system, state health and human services officials often do not have enough knowledge of government housing programs to judge how the housing programs could be used, who controls the funding and decision-making, and what types of housing can be created. 

State housing officials are frequently not responsive to inquiries from human services agencies or are reluctant to fund housing for people with disabilities.  Some are deterred by community siting and Not In My Back Yard (NIMBY) issues.  Others assume that Medicaid or other human services funding streams will be used to pay for housing – as was the case when housing and services funds were “bundled” within one residential services contract.  New funding for affordable housing is always in short supply for all populations groups (e.g. elderly households, family households, disabled households) so it is easy for housing officials to say “no.” 

Existing affordable housing programs desired by people with disabilities – such as Section 8 vouchers, housing developed with HUD Section 811 Supportive Housing for Persons with Disabilities funding, or high quality public housing – have long waiting lists.  There is also a serious shortage of affordable housing that has accessible features that are often necessary for people with disabilities with mobility or sensory impairments.  And there is no “quick fix” that will address this shortfall overnight. 

Where to Begin? 

The connection between Olmstead and government affordable housing policies will need to be initiated by those agencies and groups that are directly concerned about where people with disabilities will live.  For these discussions to be productive, however, housing advocates must have a good understanding of the opportunities and mandates that exist within government housing policies to leverage new affordable housing for people with disabilities – including those with the most severe disabilities who may be moving from institutions to the community as a result of the Olmstead decision.  These opportunities include: (1) state and local affordable housing plans required by the federal government; (2) billions of dollars of new federal housing resources appropriated by Congress each year; and (3) federal fair housing laws which reinforce the ADA mandates included in the Olmstead decision. 

Federally Mandated Housing Plans and Federal Housing Programs 

Currently, there are three housing plans required by the federal government that are prepared at the state and local level and then approved by HUD.  Government housing officials use these plans to make decisions about who will benefit from federal housing funding that HUD provides to states and local communities.  In the aggregate, these plans directly or indirectly influence the use of billions of dollars of funding for more than 20 HUD programs.  These plans are: 

• The Consolidated Plan (ConPlan)
• The Public Housing Agency Plan (PHA Plan)
• The Continuum of Care Plan (Homeless Assistance) 

Although each plan is a “stand alone” document, the plans do have some relationship to one another.  For example, the housing activities to be funded through PHA Plan and the Continuum of Care Plan must be “consistent” with the housing needs and strategies described in the ConPlan. 

Each plan requires some degree of community input before it is submitted to HUD.  However, the community process used to develop each plan – and the components of the plans – are complicated.  Nonetheless, these plans are extremely important to state agencies and housing advocates involved in Olmstead-related planning, because they determine exactly what types of housing activities will be funded and which low income groups (i.e., families with children, elderly households, people with disabilities) will receive priority.  Issue 8 of Opening Doors provides further details regarding the these strategic housing plans.  Having a basic understanding of these plans and the federal housing programs covered by these plans is a good first step towards expanding affordable housing options for people with severe disabilities who are in institutions or at-risk of institutionalization. 

The ConPlan and Olmstead 

The ConPlan is the “master plan” for affordable housing development in states and local communities.  Each year, Congress appropriates billions of dollars (approximately $7 billion in FY 2001) that HUD distributes by formula to all states, most urban counties, and communities “entitled” to administer certain federal housing programs on HUD’s behalf.  Before states and communities can receive these funds, they must have a HUD-approved ConPlan. 

The ConPlan is intended to be a comprehensive, long-range planning document that describes housing needs, market conditions, and housing strategies.   It also includes an Action Plan which specifies how the state or locality will spend the money provided through four federal programs, specifically the Community Development Block Grant program, the HOME program, the Emergency Shelter Grant program, and the Housing Opportunities for Persons with AIDS program. 

The ConPlan must catalogue housing needs by income categories and by housing type.  Several of the elements required to be in the ConPlan housing needs assessment are relevant with respect to Olmstead.  Perhaps the most important requirement is that the state or locality quantify and discuss the need for supportive housing including persons with disabilities, persons with alcohol or other drug addiction, persons with HIV/AIDS and their families, and any other category the state or locality may specify.  The plan must also describe the nature and extent of homelessness (including the needs of specific groups of homeless people) and address the need for facilities and services for homeless individuals and homeless families.  Finally, housing officials preparing the ConPlan must consult with public and private agencies that provide health and social services to people with disabilities, among others. 

These ConPlan requirements are directly relevant to the housing needs of people with disabilities who may be institutionalized unnecessarily; who are at-risk of being institutionalized; or who may be homeless as a result of being discharged from an institution.  For example, human service agencies could propose that a special category of supportive housing should be included in the ConPlan for people with disabilities who may be affected by the Olmstead decision. 

Anecdotal evidence suggests that most ConPlans do not accurately describe the housing needs of people who may be living in state institutions or facilities or who are at-risk of institutionalization.  Housing strategies adopted in most ConPlans do not typically target federal housing funding to people with disabilities who are waiting to leave institutional settings.  At the present time, there is little meaningful consultation occurring between health and human service agencies and government housing officials regarding either the housing policy issues raised by Olmstead or the housing resources which could be directed towards more community-based housing for people with disabilities. 

Amending the ConPlan 

Fortunately, HUD’s rules for the ConPlan provide that the document can be “substantially amended” at any time.  The importance of this requirement should not be underestimated for states submitting Olmstead plans to HHS.  Changes that can qualify as “substantial amendments” include (1) a change in priorities for spending funds controlled by the ConPlan; (2) a change in the purpose or scope of a ConPlan housing activity; or (3) a decision to carry out a housing activity not previously described in the ConPlan. 

It can be argued that state and local ConPlans should assess the housing needs of different groups of people with disabilities including:  people in institutions who are ready for discharge, people at-risk of institutionalization or who became homeless upon discharge, and people who are on residential waiting lists.  Housing advocates for people with disabilities can request that ConPlans lacking this information be amended.   The ADA community integration mandate affirmed by the Olmstead decision – and the extreme poverty of people receiving SSI benefits – should compel government housing officials to target a “fair share” of ConPlan funding to people with disabilities. 

The ConPlan and the HOME Program 

A thorough discussion of the potential use of HUD housing funds is well beyond the scope of this article.  However, the federal HOME program, which this year will provide $1.8 billion in housing funding to state and local governments through the ConPlan process, is a key program to target for people with disabilities leaving institutions.  This year, Congress increased the HOME program appropriation by $200 million.  These new funds could make it easier for states and communities to undertake new housing initiatives for people with disabilities while continuing to support housing that is targeted to other groups. 

The HOME program could fund the acquisition, rehabilitation, or new construction of housing for people with disabilities or could fund 2-year rental assistance subsidies for individuals leaving institutions.  However, the HOME program can also be used for rental or homeownership strategies that benefit higher income households who are employed but still considered low income.  How HOME funds are used by states and localities is decided through the ConPlan process, which is why the ConPlan is so critical to Olmstead -related planning. 

The PHA Plan 

Most federally subsidized housing for people with the lowest incomes – including people with SSI benefits – is still controlled by Public Housing Agencies (PHAs).  These resources fall into two primary categories:  (1) public housing units; and (2) Section 8 rental vouchers. 

For many years, the federal government debated what to do about PHAs.  Finally, in 1998, Congress enacted public housing reform legislation that gives PHAs more control and flexibility to decide how certain federal resources – specifically public housing and Section 8 vouchers – should be used in their communities.  For example, PHA officials can now decide to create “elderly only” public housing; to direct Section 8 voucher assistance to higher income households who are saving to purchase a home; or to provide Section 8 vouchers to people with disabilities who have Medicaid Home and Community Based waivers. 

PHAs make these decisions through the preparation of a PHA Plan, which is then submitted to HUD for approval.  Similar to the ConPlan, the PHA Plan is intended to describe the agency’s overall mission for serving low-income and very low-income individuals and families and describe the activities that will be undertaken to meet their housing needs.  The preparation of the PHA Plan requires the input of a Resident Advisory Board, but not the extensive public process and consultation requirements that apply to the ConPlan. 

New Section 8 Vouchers 

The PHA Plan process offers several creative opportunities to expand housing for people with severe disabilities.  For example, for the past four years, new Section 8 vouchers have been appropriated by Congress exclusively for people with disabilities.  These vouchers help people with disabilities rent housing of their choice in the private rental market, including housing owned by non-profit organizations. 

For FY 2001, Congress has appropriated $40 million in new Section 8 funding which will fund at least 6,000 new vouchers targeted to people with disabilities.  A PHA application to HUD for these vouchers must be consistent with activities outlined in the PHA Plan.   HUD recently awarded PHAs thousands of new Section 8 vouchers for people with disabilities from last year’s (FY 2000) budget.   Many of these awards “set-aside” vouchers for people with disabilities in several categories, including a special set-aside for people receiving Medicaid funded Home and Community Based waiver services (see Washington Bulletin on page ?). 

New policies enacted by Congress this year will make it easier for PHAs to “project base” some of their Section 8 vouchers.  This means that the PHAs can work directly with disability organizations and other non-profit groups to develop rental housing in the community and “attach” Section 8 vouchers to units in the project.  PHAs can also use Section 8 vouchers to implement the “shared housing” option, which permits unrelated people with disabilities to live together in one dwelling with on-site staff, if appropriate.  This approach has been very successful in coordinating housing resources for people with disabilities who want on-site supportive services.

The Continuum of Care Plan 

Unlike the ConPlan and the PHA Plan, the Continuum of Care Plan is not mandated by federal law.  Instead, the Continuum of Care is a HUD policy which encourages communities and states to develop a plan to organize and deliver housing and services to meet the specific needs of people who are homeless as they move to stable housing and maximum self-sufficiency.  The HUD housing and services programs funded through the Continuum of Care Plan also differ from those in the ConPlan and the PHA Plan, because they are targeted exclusively to individuals and families that meet HUD’s definition of homeless for HUD’s Homeless Assistance programs (see insert). 

HUD has required communities and states competing for Homeless Assistance funds to prepare Continuum of Care plans as part of the annual process for awarding $1 billion in housing and supportive services funding.  There are very few rules regarding how the plan is prepared and how funding priorities are established for housing and services projects included in the plan.  HUD mandates that the process should be “inclusive” and involve stakeholders in homeless programs and services as well as government agencies and the private sector.  This year, Congress explicitly directed HUD to coordinate and integrate Homeless Assistance funding with “other mainstream health, social services, and employment programs for which homeless populations may be eligible, including Medicaid … and services funding through the Mental Health and Substance Abuse Block Grant.” 

The Continuum of Care and Discharge Planning

This year, Congress also stipulated that any government entity applying for Homeless Assistance funding must agree “to develop and implement, to the maximum extent practicable and where appropriate, policies and protocols for the discharge of persons from publicly funded institutions or systems of care (such as health care facilities…or institutions) in order to prevent such discharge from immediately resulting in homelessness for such persons.”  Congress is concerned that there is little relationship between state health and human service agency discharge planning and federal policies that affect the delivery of housing and services for homeless individuals.  Improvements in this area would reduce the incidence of homelessness among people with disabilities. 

HUD’s Homeless Assistance funds are in great demand in part because they are so flexible.  However, there are several issues to consider when targeting Homeless Assistance programs for people with disabilities leaving institutions.  HUD rules do provide that, under certain circumstances, people with disabilities leaving institutions can be considered homeless.  But HUD’s eligibility guidelines also take into consideration state discharge policies that vary from state to state. 

It is important to remember that HUD’s Homeless Assistance programs controlled by the Continuum of Care are part of a “safety net” to address the problems that result after people with disabilities become homeless, and cannot be used for homeless prevention.  For this reason, they should not be the foundation of a comprehensive state plan to ensure that people in institutions who are ready for discharge have affordable housing made available to them. 

HUD’S Section 811 Program  

Of all the federal housing funding available from HUD, the Section 811 Supportive Housing for Persons with Disabilities program (Section 811) is the only one intended by law to be used solely for low-income people with the most severe disabilities.  Since its inception, the Section 811 program has provided funds to non-profit organizations to acquire, develop, or rehabilitate rental housing with supportive services for very low-income people with severe disabilities.  A relatively new tenant based rental assistance component of Section 811 provides funding for new Section 8 vouchers for people with disabilities through the Section 8 Mainstream Housing Opportunities for Persons with Disabilities program. 

Each Section 811 project must have a supportive services plan designed to meet the needs of people with disabilities, although the supportive services do not have to be delivered on-site.  Services in Section 811 projects vary from 24 hour on-site services to off-site available case management and other support services.  The Section 811 program has the potential to provide housing resources for significant numbers of individuals with severe disabilities, including those who will be leaving institutions and those on residential services waiting lists.  Unfortunately, funding for the program is extremely limited.  For FY 2001, Congress appropriated $217 million for the Section 811 program.  This amount is actually an increase of $16 million over the previous fiscal year, but will only support the development of approximately 1,600 new units of housing. 

Conclusion 

At this time, it is unclear whether the Supreme Court’s Olmstead decision will affect federal housing policies and help direct more federal housing funding to people with disabilities.  Housing advocates for people with disabilities do agree, however, that the Olmstead decision is one more opportunity to emphasize that extremely low-income people with disabilities – particularly those who rely exclusively on SSI benefits – cannot possibly afford to live in the community without some type of government housing assistance.  They also agree that any housing created as a result of the Olmstead decision must respect and support the housing preferences and choices of people with disabilities and truly fulfill the mandates of the ADA with respect to community integration.  Finally, state Olmstead-related planning activities offer an ideal opportunity for state health and human service agencies to establish partnerships with state and local housing agencies and housing providers.  The goal of these collaborations should be to develop interagency strategies that would increase affordable, community based, integrated housing options for people with disabilities that meets their preferences and needs. 

§             Authored by Emily Miller, Bonnie Milstein, and Ann O’Hara

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