With Rush Over, Questions Arise on Earthquake Relief : Housing: Some praise swift response. But officials wonder if it means shift in goals of disaster assistance.

Touring Los Angeles the day after the Northridge quake, U.S. Secretary of Housing and Urban Development Henry G. Cisneros was moved by the thousands of people pouring into outdoor encampments and feared the prospect of a new category of homeless people.

“These are poor people with no connections,” Cisneros said. “We have to help them. . . . We’ll just keep plugging until we have a way.”

Just 24 hours later, HUD officials said they had a way. The department announced an unprecedented package of emergency housing assistance that will pay most of the rent for displaced, low-income quake victims for 18 months.

The demand has been enormous, and the program has been praised by many as an example of President Clinton’s strong commitment to the recovery effort. But as the hectic rush of early relief efforts gives way to cooler reflection on the most expensive disaster relief effort in U.S. history, the housing subsidies are posing important questions about the nature, goals and limits of disaster relief efforts, according to key legislators, Capitol Hill analysts and housing experts.

Was the hastily developed HUD program essential to emergency relief efforts? Was the traditional Federal Emergency Management Agency housing assistance program incapable of meeting Los Angeles’ needs? Why guarantee 18 months of rent payments? What will happen to tenants when the voucher subsidies run out? Were controls adequate to discourage abuse and duplication and ensure the aid went to deserving victims?

It is too early to know how the Los Angeles housing voucher program will be judged, but its relatively generous terms may have helped bring an unintentional, ironic shift in disaster assistance policy. Championed by one of the highest-ranking Latinos in the Clinton Administration, the housing vouchers gave added ammunition to those criticizing public assistance for illegal immigrants, Capitol Hill sources said.

“It focused a number of senators on that (immigrant) issue,” said Sen. Harry M. Reid (D-Nev.), who helped draft a precedent-setting amendment to the $8.6-billion quake aid bill that denies assistance of more than 90 days to undocumented residents. Others argue that the issue would have erupted regardless of what relief agencies did because of an anti-immigrant climate in California and elsewhere.

HUD officials say the housing voucher program is needed, has adequate controls and strikes the proper balance. “Did we provide immediate relief and a sense that government was responsive? Are we offering a program that will help low-income people?” said Joseph Shuldiner, HUD’s assistant secretary for housing. “The answer is yes.”

Rep. Lucille Roybal-Allard (D-Los Angeles) applauded Cisneros for initiating the voucher program, which had never been used in an emergency. “It was very positive, if not courageous . . . knowing he could be subject to criticism,” she said. But the subsidies warrant close review, said Roybal-Allard, who is a member of the House subcommittee that monitors federal housing programs.

“What is our obligation and where does that stop? Do we put people in housing that they later can’t afford? Is this money going to encourage people to . . . be lazy and not work and take advantage of the system? This has to be very carefully monitored.”

As with reports of rampant fraud in the free-flowing, post-quake food stamp program, and disclosures that FEMA mailed checks to people who had not sought assistance, the housing vouchers highlight the conflicting pressures on government officials in the wake of a major disaster. If people are not quickly rehoused and aid is not swiftly disbursed, officials risk criticism from the public, politicians and the media that the needy are going unserved. But opening the relief tap too wide can lead to waste, abuse, scandal and legislative second-guessing.

In theory, FEMA’s emergency housing grants, given in two-month increments to renters and three-month increments to homeowners, are supposed to meet the needs of disaster victims. The grants, typically $1,100 per month for Northridge earthquake victims, are given without regard to income, although inspectors are supposed to confirm the applicant’s residence was damaged.

FEMA’s grant can be extended up to 18 months if a continuing need for assistance is demonstrated. FEMA grants are paid to victims, who may spend them as they wish on replacement housing or to repair a damaged residence.

The new vouchers, which are intended exclusively for low-income households, were needed, HUD officials said, so poor quake victims could compete for suitable replacement units. They note that affordable apartments are scarce in Los Angeles, and the supply of older, multiunit apartments was diminished by the quake.

HUD has budgeted $200 million for the vouchers, which guarantee a landlord rent for 18 months. The tenants pay 30% of their income to the landlord and the government pays the remaining rent, which can total 90% or more of the monthly payment. In many cases, that has allowed quake victims to move into apartments they could not have afforded before the disaster.

The longer term of the voucher and the direct government payments to landlords make low-income apartment hunters more appealing to building owners, housing officials say. “No one is going to rent to them” if they only have a guarantee of two months’ rent, HUD’s Shuldiner said. “The reality is that the (FEMA grant) would have very little value” to low-income quake victims struggling to find housing.

But some key legislators are not fully convinced. Rep. Julian C. Dixon (D-Los Angeles) said it is not clear to him that shorter-term housing assistance, such as FEMA’s, would not have been more suitable.

“I’m not clear it has been studied through,” said Dixon, a member of a special House committee, created in the wake of budget battles over the Los Angeles aid package, that will review disaster relief programs. “I never envisioned any of these programs going beyond the period necessary to find permanent housing or move these people back into their original housing.”

The Northridge quake marked the first time HUD housing vouchers were offered immediately in the federal disaster assistance centers. The intent was to quickly move poorer applicants directly into longer-term housing. But the program has not moved as briskly as officials had initially hoped. It has taken many applicants weeks to get an appointment to apply for a voucher, then find a suitable unit and complete a process of HUD inspections and rent negotiations with landlords. As of late this week, nearly 17,000 tentative vouchers had been approved, but less than 2,400 recipients had been given final approval to move into new units.

There also have been concerns about the basis on which the HUD vouchers were being distributed, particularly in the beginning. Housing officials have relied heavily on computer reports compiled by Los Angeles city building inspectors to verify that an applicant’s building was damaged.

But building officials note that their inspections were cursory and not necessarily reliable for decisions on disbursement of long-term housing grants. “These (reports) were not intended for that purpose,” said Nick Delli Quadri, a spokesman for the Building and Safety Department. “(They) were basically intended to develop a statistical analysis of damage . . .things were very rough. It was not intended to look at each building point by point and say this building is not good and that one is good.”

Housing officials said there was no fast, feasible alternative. “It was the best there was,” said Gary Squier, general manager of the Los Angeles city housing department.

It is also unclear how many landlords will be willing to accept the vouchers. Some have expressed reservations about getting involved in a government assistance program, and there have been reports of voucher-holders having difficulty finding units.

Cisneros convened a meeting with the building owners last week to encourage more to accept the vouchers. “Obviously, if we had known what we know today . . . we would have done the outreach (to landlords) from the beginning,” Shuldiner said.

Looking ahead, critics warn that the emergency housing vouchers could become a costly permanent form of housing assistance in Southern California. “They’ll come in (in 18 months) and we’ll have to renew the damn things,” said one GOP analyst on the House Appropriations Committee.

Officials in Dade County, Fla., are seeking just such a renewal for HUD housing vouchers offered to victims of Hurricane Andrew in 1992. Far smaller in scope, the Florida vouchers were offered two months after the hurricane. And the vouchers, good for two years, went to a different mix of applicants, including some who had lived in federally subsidized housing units before the hurricane.

Nonetheless, with the first batch of vouchers scheduled to expire later this year, Dade County officials report that most recipients still can’t afford adequate housing and are at risk of losing their shelters if the relief program is not extended.

HUD and local housing officials say they hope to minimize such problems here. Recipients will be reminded in writing that their subsidies will only last 18 months.

“We believe a significant number of the people will not need the program more than 18 months,” Shuldiner said. “They were making it (on their own) beforehand. They do have an ability to get jobs. They will get their act together.”

Critics say any effort to extend the vouchers would be unfair to tens of thousands of needy families in Los Angeles County who have been waiting for such federal housing assistance for years.

Mary Comerio, a UC Berkeley associate professor and expert on disaster housing issues, says it is far from clear the 18-month vouchers represented the best use of HUD’s $200 million. “It doesn’t address the underlying supply of affordable housing, and it sets people up to delay their real housing choices,” she said.

“In 18 months the world (for low-income renters) isn’t going to look a whole lot different than it does right now. It’s seriously time for the federal government to think about a disaster housing policy . . . instead of having a kind of knee-jerk reaction in response to each disaster,” Comerio said.