Penny Wise, Pound Foolish: Cutting the Housing Budget Will Only Cost Us More

Penny wise, pound foolish may be a cliché, but it is one that resonates in today’s public square. While lawmakers balk at investing in safe, decent, affordable homes, the Commonwealth ends up spending millions of dollars to mop up the effects of substandard housing and homelessness.

Consider: There are elderly Pennsylvanians and people with disabilities living in nursing homes at state expense simply because they cannot find affordable, accessible homes to move into. A nursing home costs about $40,000 a year. A rental voucher costs about $8,000. Even if the person needs supportive services, the total including rental assistance would run maybe $20,000. No one is really sure how many people are in this situation, but if 100 people were moved out of nursing homes and back to their communities with rental vouchers and supportive services, we could save $2,000,000 a year.

We also pay for the medical problems associated with substandard housing and homelessness - asthma, burns, falls, communicable diseases, stress and other mental health problems. Oh, and lead poisoning, which causes brain damage and anti-social behavior among other problems. We pay for that through special education classes and incarceration.

In 2007, the North Carolina Housing Coalition released a report examining the direct and indirect costs resulting from medical conditions associated with substandard housing. They only looked at children, even though adults also suffer. Their finding?

• $95 million total costs in one year in a state two-thirds the size of Pennsylvania
• This figure includes $13.4 million in direct medical costs

Considering that many of these children receive Medical Assistance, this is a significant price tag for the state.

Investing in quality, affordable homes will save the Commonwealth money. But as the old saying goes, you have to spend money to make money, or in this case, save money.

We need start-up funds. We need to invest in balancing the housing market which means more quality rental at prices people can afford – near the jobs. We need to capitalize the new state housing trust fund so that we, the taxpayers, can realize the dividends.

The best thing is those dividends are not just monetary. Our investment will lead to stronger families, stronger communities, and a more prosperous Pennsylvania.

In the meantime, cutting the state’s housing budget is going to cost us all more money.