For Nakeema, life was beginning to look promising nearly a year after first experiencing homelessness.

The Brooklyn mother and her children found a two-bedroom apartment in Kew Gardens, Queens with a landlord who accepted her city-issued rental-assistance voucher, a program meant to help homeless New Yorkers find permanent housing.

The rent was $2,217 a month, the maximum she could get for a family of three.

“The building is really nice. It's a nice area for my children. Quiet. It seems safe. It has an elevator, and it has a laundry room in the building,” said Nakeema, 42, who asked that only her first name be used because she fears it might jeopardize her ability to find housing. “It was just very convenient. The trains were nearby. The supermarkets were nearby.”

For months, she and her 6-year-old son and 2-year-old daughter have been bedding down in a friend’s living room in Sheepshead Bay, Brooklyn, waiting to move into permanent housing. But Nakeema's plans were upended in January when a caseworker told her the city wouldn’t pay the maximum rent unless it also covered all utilities, including electricity.

“She told me ‘I cannot put your paperwork through because [the landlord] has to either agree to pay the electricity or lower the rent,’” recalled Nakeema.

New York City’s rental voucher program, known as CityFHEPS, was designed to help homeless individuals find permanent homes. But homeless New Yorkers and their advocates say a recent rule change has caused confusion, delays and unnecessary hurdles to an already onerous approval and leasing process. Advocates said it may be a cost-saving measure, though it’s unclear why the change was made, but it’s forcing some individuals and families to stay in homeless shelters or temporary housing longer, costing taxpayers more money in the long run.

“The stupidity of it is that every month they sit in the shelter, they're costing the city thousands of dollars a month,” said Edward Josephson, supervising attorney of the Legal Aid Society’s Law Reform Unit. “So, the city is saving pennies by saving themselves a hundred bucks on the rent, and they're losing thousands of dollars in extra shelter costs. So, that is dumb.”

The Department of Social Services (DSS), which administers the rent subsidy program, issued the new payment standards that went into effect on Dec. 1, 2021. The department now mandates that, in cases where utilities are not included or covered by the rent agreement, DSS will deduct a utility allowance from the maximum rent the voucher covers. This practice, according to DSS, is in keeping with other city agencies that provide housing subsidies to New Yorkers.

The stupidity of it is that every month they sit in the shelter, they're costing the city thousands of dollars a month

Edward Josephson, supervising attorney of the Legal Aid Society’s Law Reform Unit

The deductions range from $15 to $227 depending on the type of utility and the size of the apartment. The city won’t allow voucher recipients to pay the difference out-of-pocket.

Homeless advocates have argued that the new rule is a hindrance to a program that was recently expanded to stem the rise in homelessness and address the city’s affordable housing crisis. In May of last year, the City Council voted to expand the rent subsidy offered to people by increasing the value of housing vouchers to bring them closer in line with market rents, which homeless advocates lauded at the time.

One of the problems with the rollout has been transparency, said Catherine Trapani, executive director of the advocacy group Homeless Services United, a coalition of 50 non-profit agencies serving homeless and at-risk adults and families in New York City. She said DSS officials did not make clear to apartment seekers — along with case workers, housing specialists, and landlords — that the maximum rent listed on the voucher, referred to by DSS as a “shopping letter,” includes all utilities.

Voucher holders mistakenly believed the amount indicated on the first page of their voucher is the maximum rent, Trapani said.

“As a matter of public policy, if you're willing to pay $2,000 or X amount, and the utility allowance shaves off $97, is $97 really worth keeping somebody in shelter for significantly longer periods of time?” Trapani asked. “From a cost savings measure, I'm not sure I understand it. Is it really worth making people have to find another unit if they can't negotiate rent reductions? I don't think it is.”

Because of the new rule, some homeless individuals looking to move into permanent housing have lost apartments, forcing them to start the search process all over.

The problems have occurred with such frequency, Trapani said, that Homeless Services United has held discussions with DSS officials to try to find a fix.

“There have been enough challenges that have surfaced that we believe it to be a widespread issue,” Trapani said.

A spokesperson for DSS declined to address specific questions and sent a statement, touting the department's past work connecting individuals and families to permanent housing.

One of those caught in the bureaucracy is Milena, another homeless woman currently living in a shelter in Jamaica, Queens after she said she was forced to evacuate her building due to emergency repairs.

Milena, 32, who asked that only her first name be used to protect her privacy, said she ran into the same problem with the utility allowance in November as she tried to find housing. She said DSS sent her a “shopping letter,” indicating the maximum rent she is potentially eligible to receive for different housing types, including up to $1,945 in rental assistance for a one-bedroom apartment or $1,900 for a studio.

Armed with the voucher, Milena found a one-bedroom in Kew Gardens through a real estate broker. The rent was $1,850 a month, $95 below her maximum allowance. However, she said the broker told her she wouldn’t get the apartment because her voucher would not cover the rent after the city deducted the utility allowance.

Several times, Milena said she found one-bedroom apartments in Maspeth, Astoria and Sunnyside. In one case, the rent was $1850, a difference of $2 more a month than what the city would pay after it deducted the utility allowance. Milena said she offered to pay the landlord the $2 a month but was told that city rules prohibit her from doing so. If she did, she’d lose her rental assistance altogether.

“They're gonna help me. I'm going to get my life together. I'm finally gonna move back. And, then it's like, well, you're missing $2,” she said. “It has been a nightmare.”

Finally, Milena said she “begged” the real estate agent to ask the landlord to lower the rent to $1848, so DSS would approve her apartment and she could move out of the women's shelter where she has lived for seven months.

“I’m just so thankful that they actually took me,” Milena said. “Because I have cried my eyeballs out.”

In January, Milena signed her lease for the one-bedroom apartment in Sunnyside, which was supposed to begin Feb. 1, but she said additional delays have pushed it back even further. She now hopes to move in March.

Nakeema, the mother of two in Sheepshead Bay, wasn’t so lucky.

In January, she said the city rejected her application. Nakeema, who works as a home health aide while attending college courses at Touro College, said she was told that after the city deducted about $160 for utility allowance, the amount remaining would not cover the rent. The landlord, she said, had lowered the rent from $2,500 to $2,217 a month, and he wasn’t willing to reduce it further.

"I'm dealing with my kids. I'm dealing with school. I’m dealing with work. It's overwhelming and it's so stressful,” she said. “And at times I just feel like giving up, but what is giving up going to do?”

Apartments can fall through for many reasons, homeless advocates said. Tenants have trouble filling out the applications, the landlords don’t provide the right paperwork, some renters don’t speak English, others suffer from mental illness.

“There are millions of barriers for these folks who are trying to find apartments,” said Josephson of the Legal Aid Society. “It’s bad enough with that, then layered on top of that you have these extra rules that are just unnecessary obstacles.”

Nakeema said the city is moving her to a different rental assistance program that does not have the utility allowance standard. But she said she was told that the process could take up to six months.

Now and then, her son asks when they can move out of her friend’s living room and into a place of their own.

“I had to comfort him, and it just broke my heart because I'm trying so hard to provide a stable environment, a long-term environment for my children,” Nakeema said.