According to Census data, in 2005 an estimated 21.9 million households, or 20 percent of the 111.1 million households nationwide, were “veteran households”—that is, they had at least one member who was a military veteran. Most veteran households—about 80 percent—owned their own homes, a significantly higher percentage than was the case for other (nonveteran) households (about 64 percent). About 4.3 million veteran households rented their homes. Census data also show that renter households were more likely to be low-income than were owner-occupied households; in 2005, about 66 percent of renter households were low- income while 32 percent of homeowners were low-income. VA, through a variety of programs, provides federal assistance to veterans who are homeless, and also provides homeownership assistance, but does not provide rental assistance. One of the agency’s largest programs for homeless veterans is the Homeless Providers Grant and Per Diem program, which provides funding to nonprofit and public agencies to help temporarily shelter veterans. VA also administers eight other programs for outreach and treatment of homeless veterans. In addition to its homelessness programs, VA provides a variety of programs, services, and benefits to veterans and their families. HUD provides rental housing assistance through three major programs— housing choice voucher, public housing, and project-based. In fiscal year 2005, these programs provided rental assistance to about 4.8 million households and paid about $28 billion in rental subsidies. These three programs generally serve low-income households—that is, households with incomes less than or equal to 80 percent of their local area median incomes. Most of these programs have targets for households with extremely low incomes—30 percent or less of their area median incomes. HUD-assisted households generally pay 30 percent of their monthly income, after certain adjustments, toward their unit’s rent. HUD pays the difference between the household’s contribution and the unit’s rent (under the voucher and project-based programs) and the difference between the public housing agencies’ operating costs and rental receipts for public housing. According to our analysis of ACS data, of the 4.3 million veteran households that rented their homes, an estimated 2.3 million, or about 53 percent were low-income in 2005. As shown in table 1, the largest share of these 2.3 million households was concentrated in the highest low-income category—that is, 50.1 to 80 percent of the area median income—with somewhat smaller shares in the two lower categories. The table also shows that other renter households (that is, households without a veteran member) were even more likely to be low-income than veteran renter households. The estimated numbers of low-income veteran renter households in 2005 varied greatly by state, from some 236,000 in California—the most of any state—to less than 6,000 in each of 3 states—Delaware, Vermont, and Wyoming. The percentages of veteran renter households that were low- income in 2005 also varied considerably by state, from about 65 percent in Michigan to about 41 percent in Virginia. Further details on how these figures varied by state, including maps, can be found in appendix I. In addition, a significant proportion of low-income veteran renter households included a veteran who was elderly or had a disability. Specifically, an estimated 816,000 (36 percent of these veteran households) had at least one veteran who was elderly (that is, 62 years of age or older); and 887,000 (39 percent) had at least one veteran member with a disability. According to our analysis of ACS data, an estimated 1.3 million low- income veteran households, or about 56 percent of the approximate 2.3 million such households, had rents that exceeded 30 percent of their household income in 2005 (see table 2). These veteran renter households had what HUD terms “moderate” or “severe” problems affording their rent. Specifically, about 31 percent of low-income veteran renter households had moderate affordability problems, and about 26 percent had severe affordability problems. The remainder either paid 30 percent or less of their household income in rent, reported zero income, or did not pay cash rent. In comparison, a higher proportion of other low-income renter households had moderate or severe housing affordability problems. The extent of housing affordability problems among low-income veteran renter households varied significantly by state in 2005 (see fig. 1). The median percentage of low-income veteran renters with affordability problems nationwide was 54 percent. California and Nevada had the highest proportions of affordability problems among low-income veteran renter households—about 68 and 70 percent, respectively. North Dakota and Nebraska had the smallest—about 37 and 41 percent, respectively. A relatively small percentage of veteran households lived in overcrowded or inadequate housing in 2005. Specifically, an estimated 73,000, or 3 percent, of low-income veteran renter households lived in overcrowded housing—housing with more than one person per room—and less than 18,000, or about 1 percent, lived in severely overcrowded housing— housing with more than one and a half persons per room. In contrast, an estimated 1.5 million, or 7 percent, of other low-income renter households lived in overcrowded housing, and about 423,000, or 2 percent, lived in severely overcrowded housing. Finally, ACS data indicate that a very small share of low-income veteran renters lived in inadequate housing. ACS provides very limited information about the quality of the housing unit; the survey classifies a unit as inadequate if it lacks complete plumbing or kitchen facilities, or both. In 2005, an estimated 53,000, or 2 percent, of low-income veteran renter households lived in inadequate housing. In comparison, an estimated 334,000, or 2 percent, of other households lived in inadequate housing. HUD’s major rental assistance programs are not required to take a household’s veteran status into account when determining eligibility and calculating subsidy amounts. (Consequently, HUD does not collect any information that identifies the veteran status of assisted households.) As with other households, veterans can benefit from HUD rental assistance provided that they meet all of the programs’ income and other eligibility criteria. For example, assisted households must meet U.S. citizenship requirements and, for some of the rental assistance programs, HUD’s criteria for an elderly household or a household with a disability. When determining income eligibility and subsidy amounts, HUD generally does not distinguish between income sources that are specific to veterans, such as VA-provided benefits, and other types of income. HUD policies define household income as the anticipated gross annual income of the household, which includes income from all sources received by the family head, spouse, and each additional family member who is 18 years of age or older. Specifically, annual income includes, but is not limited to, wages and salaries, periodic amounts from pensions or death benefits, and unemployment and disability compensation. HUD policies identify 39 separate income sources and benefits that are excluded when determining eligibility and subsidy amounts. These exclusions relate to income that is nonrecurring or sporadic in nature, health care benefits, student financial aid, and assistance from certain employment training and economic self- sufficiency programs. We found that, based on HUD’s policies on income exclusions, most types of income and benefits that veteran households receive from VA would be excluded when determining eligibility for HUD’s programs and subsidy amounts. Many of the excluded benefits relate to payments that veteran households receive under certain economic self-sufficiency programs or nonrecurring payments such as insurance claims. Of the benefits included, most are associated with recurring or regular sources of income, such as disability compensation, pensions, and survivor death benefits. Of the 39 exclusions, we found that two income exclusions specifically applied to certain veteran households but, according to HUD, these exclusions are rarely used. These income exclusions are (1) payments made to Vietnam War-era veterans from the Agent Orange Settlement Fund and (2) payments to children of Vietnam War-era veterans who suffer from spina bifida. The two exclusions are identified in federal statutes that are separate from those authorizing the three major rental assistance programs. HUD does provide rental assistance vouchers specifically to veterans under a small program called the Housing and Urban Development- Veterans Affairs Supportive Housing program (HUD-VASH). Established in 1992, HUD-VASH is jointly funded by HUD and VA and offers homeless veterans an opportunity to obtain permanent housing, as well as ongoing case management and supportive services. HUD allocated these special vouchers to selected public housing agencies that had applied for funding, and VA was responsible for identifying participants based on specific eligibility criteria, including the veteran’s need for treatment of a mental illness or substance abuse disorder. Under the HUD-VASH initiative, HUD allocated 1,753 vouchers from fiscal years 1992 through 1994. HUD funded these vouchers for 5 years and, if a veteran left the program during this period, the housing agency had to reissue the voucher to another eligible veteran. According to VA officials, after the 5-year period ended, housing agencies had the option of continuing to use their allocation of vouchers for HUD-VASH, or could discontinue participation whenever a veteran left the program (that is, the housing agency would not provide the voucher to another eligible veteran upon turnover). VA stated that after the 5-year period ended, many housing agencies decided not to continue in HUD- VASH after assisted veterans left the program; instead, housing agencies exercised the option of providing these vouchers to other households under the housing choice voucher program. As a result, the number of veterans that receive HUD-VASH vouchers has declined.