Charging the Homeless "Rent"

For almost a year, the Bloomberg administration has been tinkering with plans to charge homeless New Yorkers to live in public shelters. This has provoked strong reactions among some advocates who question the benefits of taking money from poor people who are in dire need of help.

One issue that is easily lost in this debate is that paying rent is more than monetary. It demonstrates mastery of a range of skills - for example, opening a bank account, keeping a checkbook and maintaining a budget.

These skills are not inherent or easy to acquire. Just think of all the bankruptcies declared among Americans with greater financial and emotional resources. Still, they must be learned, and homeless individuals - weighed down by poverty, struggling to survive on the streets and/or navigating the child welfare system - don't often have this opportunity.

I am honored to run an organization - Covenant House New York (CHNY), the City's largest nonprofit agency serving homeless, runaway and at-risk youth - where longer-term residents pay modest, weekly program fees. However, CHNY returns these funds when the youth are ready to move on. The "rent" helps them make a fresh start as they embark on independence.

By mandating that our residents set aside money, we teach them to budget and save: a life skill that is especially critical for those who are poor and thus have little to no room for error in their finances. Like other groups on "the margins," the CHNY population copes with a severe lack of low-income housing, and those fortunate enough to find jobs frequently receive very low pay.

Our approach goes beyond teaching the process of saving, but also demonstrates its tangible benefits. Formerly homeless young people, who are not accustomed to having extra cash, find themselves able to afford the security deposit for their first apartment, lightly-used furniture and/or clothes for a growing baby.

Just as important is that CHNY mimics what life is like in the "real world." The difference is that at the agency, young people can practice personal finance and perhaps "fail" without severe consequences. Instead, it becomes a learning opportunity.

For all these reasons, my colleagues and I believe charging homeless individuals "rent" is productive when it's used as a tool to educate and help save money. Without it, our residents would embark on new lives already in a financial hole, of which it is sometimes impossible to dig out.

Too often, individuals who have moved from agency to agency develop a dependence on "the system." Skills like paying rent can be lost, sometimes for generations. We cannot lose sight of this fact as we work to help those living in our shelters transition to self-sufficiency, and I'm sorry to say, free up room for men, women, youth and children who are still living on our streets.