L.A. Plans to Reduce Rental Aid for the Poor

More than 44,000 low-income families in Los Angeles whose rent is subsidized by a federal program will be forced to rent cheaper units and contribute more of their monthly income to housing costs under changes proposed by HUD and recently approved by the city housing authority’s board of commissioners.

The measure, which is part of an effort to address funding problems that have threatened the Section 8 program, decreases the monthly subsidy the program makes to house poor families.

Section 8 families that are planning to move will be affected immediately; subsidies will be lowered for all participants within the next two years, housing officials said.

In Los Angeles, about 95,000 people live in subsidized houses or apartments. Advocates and tenants worry that lower subsidies will make it tougher for families to find a place to rent -- and harder to make ends meet each month.

“That means I don’t get to have lights, gas and a phone,” said Delilah Bowen, a former social worker who is disabled and lives on welfare.

The change is just one of many underway at the Housing Authority of the City of Los Angeles.

On Monday, the Housing Authority’s board approved a memorandum of understanding with the Department of Housing and Urban Development that calls for the federal agency to play a greater role in its affairs.

The agreement calls for several changes, including the appointment of a new director of Section 8. Steve Renahan, the current director and a 20-year veteran of the agency, is expected to remain with the Housing Authority but not as the director.

At a meeting last week, Renahan told the agency’s board that the decrease in monthly subsidies and other changes were recommended by HUD officials as something “we should do promptly to reduce costs.”

The actions are in response to funding problems with Section 8. Under the program, participants pay about 30% of their income toward rent and the federal government pays the rest.

In February, the housing authority suspended the vouchers of 1,500 participants, citing a lack of funds. An additional 5,000 families in subsidized housing could have had their rental contracts canceled.

Local housing officials sought ways to reduce costs without displacing families, Renahan said.

“We want to try to find the balance between these two objectives,” he told the board.

The decision to lower monthly payments is a significant, and some say troubling, move in a high-rent market like Los Angeles.

In past years, tenants with housing vouchers struggled to find landlords willing to accept the vouchers at a time when much higher rents could be charged on the open market.

The agency launched an aggressive outreach program to property owners and increased rent subsidies to mirror rents on the open market. As a result, more families found housing and poor families rented higher-quality units in neighborhoods with less crime and poverty, according to an authority report.

Because of budget constraints, that strategy is no longer viable. Families will be notified of the proposed decrease in payments at their next annual review. The decrease would go into effect the following year, officials said.

For a family renting a two-bedroom apartment, for example, the subsidy would decrease from $1,204 each month to $1,005.

For a family renting a three-bedroom apartment, the subsidy would decrease from $1,625 to $1,276.

Tenants who already pay about 30% of their income would be forced to move or cover a greater portion of the rent, provided the total amount they paid did not exceed 40% of their income.

But many tenants may be unable to pay that much. To participate in Section 8, tenants must be designated under federal guidelines as either “very low income” or “extremely low income.”

In Los Angeles, a family of four, for example, with an income of $29,750 or less is considered very low income, according to HUD. A family of four with an income of $17,850 or less is considered extremely low income.

“This will make it more difficult for tenants to find landlords who will accept Section 8,” said Larry Gross of the Coalition for Economic Survival, which organizes tenants of public housing. “It will force Section 8 tenants into a smaller area, helping to ghettoize Section 8 tenants.”

Bowen, the former social worker, is already experiencing difficulty because her subsidy has been reduced. Bowen originally received a voucher that allowed her to rent a two-bedroom apartment for up to $1,250 a month.

“I was very fortunate to find [an] apartment,” Bowen said. “I did everything they asked me to do. I completed all of the paperwork.” But last week, housing authority staff informed her that the agency would pay only $1,125 for a comparable apartment in Pacoima, which is a 10-minute walk from her current one in Lake View Terrace.

“Because they haven’t accepted the voucher, I’m trying to come up with the extra money to cover the voucher,” said Bowen, whose arthritis and degenerative joint disease forced her onto disability, then welfare.

She and her 13-year-old son live on a monthly $511 welfare check while her application for Social Security is being processed. So far, she has not found the money to move to the new apartment, but has told the current owner she would move by Friday.

“I’m walking by faith, and I mean that,” she said.

Irene Molina, 75, has already experienced her share of stress. City officials and owners of the apartment she lives in wrangled over the Section 8 program. The owners, who had sought to remove the building from the program, last year agreed to accept vouchers from Molina and other tenants. Now she has new problems to anticipate.

“It’s a real big concern for her, because she is on Social Security,” said Molina’s daughter, Patricia. “She gets very little income as it is.”

Paying more rent would be tough, “but if she would have to move, it would be devastating,” said Patricia Molina, whose mother has lived in her apartment for 30 years.

Arnie Corlin, a property owner who sits on the board of directors for the Apartment Assn. of Greater Los Angeles, criticized both the decision to lower rent subsidies and what he called the inefficiencies of the Housing Authority. Lowered subsidies might push away owners, said Corlin.

“I don’t feel it’s fair to the tenants,” Corlin said. “I also don’t think it’s fair to the owners.”

In other action, the authority’s board last week imposed a minimum rent of $50, which will affect about 500 tenants who pay less than $50 each month because their incomes are extremely low.

The board also voted to limit the annual increase to 3% for owners who rent to Section 8 tenants and whose buildings are under rent control.

Linda Williams, a housing advocate with the Legal Aid Foundation of Los Angeles, said the changes will hit especially hard because of the city’s housing shortage.

“The quick fix they are trying to implement is on the backs of individuals who can’t afford it: the elderly, the disabled, single moms with kids,” she said.