CITY HALL — The Santa Monica Housing Authority should take a closer look at its federal housing voucher program to ensure that it’s promoting diversity and availability of housing choices for the city’s poorest residents, according to the Legal Aid Foundation of Los Angeles.

The recommendations come as comments to a draft report released in June 2012 looking at roadblocks to fair housing in the city, a document required by the U.S. Department of Housing and Urban Development to qualify for federal funds.

Santa Monica’s rents are too high for a federal program meant to help low-income people afford housing, according to the report.

The city also lacks sufficient protections for participants in the program, who can be discriminated against by landlords who are trying to avoid renting to those with vouchers, wrote Denise McGranahan, an attorney with the Legal Aid Foundation.

“Voucher recipients in Santa Monica have great difficulties finding landlords who will accept their vouchers,” McGranahan wrote. “This is partially due to the payment standard but also due to discrimination against Section 8, which may often be veiled discrimination against minorities, the disabled and the elderly.”

The housing voucher program, also called Section 8, is the largest federal government program that helps low-income families, seniors and disabled to get housing in the private market by providing guaranteed rental payments to landlords.

In theory, renters pay roughly up to 40 percent of their income toward rent and utilities in the first year, and the voucher picks up the difference. Vouchers have a ceiling on the amount that they can cover that can vary based on where they are used.

Santa Monica’s vouchers are already higher than those in Los Angeles County, said Lucie Loach, Santa Monica Housing Authority administrator.

A Section 8 voucher will cover $1,101 in rent for a one bedroom in the county, and $1,352 for a one bedroom in Santa Monica. Similarly, a two-bedroom apartment voucher covers $1,421 in the county and $1,843 in Santa Monica, Loach said.

Although the payment standards are higher in Santa Monica than elsewhere in Los Angeles, they’re not high enough to give individuals and families a real choice of apartments available in the city, McGranahan argued.

The housing vouchers don’t reach the median market rents, which limits people to specific sections of the city, usually in the eastern end.

“This is not to say that the only landlords who rent to Section 8 tenants are in the Pico Neighborhood,” McGranahan said. “However, they have limited access to more expensive areas of the city unless the units they are renting are through (nonprofit housing provider Community Corporation of Santa Monica) or are inclusionary housing units.”

Santa Monica could fix that by applying to the federal government for an increase in the payment standard, she said. It hasn’t done so since 2007, and that motion was denied.

The amount that the vouchers cover hasn’t been a problem, Loach said. Finding a private landlord willing to accept a Section 8 tenant over other applicants, however, is.

Section 8 voucher holders may have bad credit history, and some have criminal convictions that don’t make it past a landlord’s background check. Because the vouchers are used in the private market, potential renters still need to meet all of their usual requirements.

The Housing Authority has a stable of landlords who are convinced of the benefits of the program, specifically that most if not all of the rent will be guaranteed by the federal government and show up on time, Loach said.

“We try to sell it in a way to show it’s a good program,” she said.

City Hall could take additional steps to ensure that landlords are not discriminating against voucher holders for their participation in the program, McGranahan said.

Existing state legislation that prohibits discrimination based on source of income doesn’t cover Section 8 vouchers, but the local government could make it more difficult to refuse to rent to a tenant who otherwise qualifies for the unit and can afford the rent, she said.

“Studies have shown that in jurisdictions which prohibit Section 8 discrimination, there is less discrimination against minorities and other members of protected classes,” McGranahan said.

A dark day may be around the corner for the housing program.

The federal government is scheduled to undergo brutal cuts in March if President Barack Obama and Congress fail to craft a compromise to close the budget deficit.

That will mean a cut of 16,219 vouchers in California alone, some of which may already be held by poor families, McGranahan said.

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