As the cost of housing continues to increase, Santa Monica’s most at-risk renters got a little help from the Federal Government last week.
The U.S. Department of Housing and Urban Development (HUD) agreed to significantly increase the value of housing subsidies under the Housing Choice Voucher program, formally known as Section 8, that provides aid to low income renters such as seniors, families and individuals with disabilities
Under the HCV program, HUD provides a finite budget to local authorities and sets limits on the amount of money that can be issued to clients based on the size of the unit. The recent decision increases the value of a voucher but it does not increase the total funding available. The old standards set spending limits at $1,009, $1,352, $1,843 and $2,411 for studio, one, two and three bedroom apartments. Officials said those amounts were often well below the cost of an apartment rendering the vouchers of little use in the local housing market.
Prices for market rate housing increased beyond the voucher subsidy years ago but housing advocates said even the city’s supply of Rent Controlled units has become less and less affordable over time due to the Costa Hawkins Act. Costa Hawkins allows a rent-controlled unit to reset to market rate when a tenant vacates the unit. The price increase effectively takes the unit out of the affordable housing supply.
The new payments will be $1,512, $1,930, $2,640 and $3,366 for studio, one, two and three/four bedroom apartments.
“The recent U.S. Department of Housing and Urban Development approval of a voucher payment increase will make enormous improvements to our Section 8 program,” said Richard Hilton, chair of the Santa Monica Housing Commission. “Including tenant retention, owner assistance, and expanding affordable housing opportunities to our neediest residents and workforce.”
County Supervisor Shelia Kuehl said the skyrocketing cost of rent has been responsible for gutting communities and local cities have been unable to preserve their resident mix due in part to the low amounts paid by the subsidy. She said the Board of Supervisors has had numerous meetings with HUD officials to argue for subsidy increases across the Los Angeles region.
“We couldn’t even guarantee workforce housing in many areas of the west end because the Section 8 vouchers were insufficient to help people get subsidized apartments,” she said. “Landlords were saying, ‘even if we wanted to help out, we can’t even afford it because it costs us more in maintenance than what we are getting from HUD and the percentage of income you can require from a tenant.’ So I advocated the possibility of trying to help increase these vouchers in areas where the rents were very high so that at least we could maintain some balance and not have it just be wealthy enclaves and they apparently took that seriously.”
Regardless of the amount the voucher pays, she said there’s a shortage of landlords willing to take the payments, causing some folks with subsidies, such as veterans, to remain homeless even when they have a subsidy. She said she is reaching out to landlords throughout her district to encourage them to engage in the process.
“We will not be able to maintain sufficient affordable housing, nor will we be able to solve the problem of homelessness without the participation of lots of landlords,” she said.
The HUD decision is specific to the federally funded vouchers however, other forms of housing voucher base their value on the HUD standard which means more money will be available throughout several voucher programs as a result of last week’s decision.
In announcing the payment increase, City Hall said the timing is fortuitous because it coincides with the recently approved HOUSE (Housing Opportunities Utilizing Subsidy Enhancements) program to incentivize owners to participate in voucher programs.
According to the City’s press release, the main incentive offered involves a $5,000 signing bonus when a vacant, rent-controlled apartment is leased to qualifying tenants with a voucher.
Staff said the HOUSE program can fund 45 bonuses and is expected to rollout in June of this year.