As rents rise, cutbacks loom in housing assistance.

WHEN the Section 8 housing voucher arrived last December, Regina Sims-Starke believed she had the final piece necessary to reunite her family for the first time in three years.

With the help of a Skid Row drug treatment program, she had overcome a years-long crack cocaine habit. She had already saved up $1,500 for a deposit, and armed with the rent-subsidy voucher, she soon found a landlord who offered her an apartment in the Crenshaw district. She had even fallen in love; she would marry Thomas Starke Jr. while both still lived in neighboring programs on Skid Row.

Her new apartment would have room for Sims-Starke's 18-year-old daughter, Ebony, and grandson Tashawn, who were in a shelter. They could also bring Sims-Starke's mother, 55-year-old Velma Brown, home from a convalescent hospital in Lake View Terrace.

"We were going to come together as a family," said Sims-Starke, who is 39. "We've always been together, and we've been separated for the past couple of years."

Then came the letter rescinding the voucher. Due to budget cuts, Sims-Starke was informed on Feb. 8, the subsidy had been suspended.

Last week, she and Thomas Starke, now her husband, were living in the Nutel Motel near MacArthur Park, paying $203 per week for a one-room space with a kitchenette. The nest egg is gone, the voucher is worthless and a variety of mostly mundane obstacles--a past eviction, the vagaries of program rules--have conspired to dim the outlook for finding a permanent housing alternative.

National crisis

The Starkes are caught in the vortex of one of the worst public housing crises in more than 40 years, both locally and nationally. At precisely the moment when apartment rents are soaring out of reach, the main federal assistance program is being cut back. In Los Angeles, the problems with Section 8 have been aggravated by a management crisis at the city housing authority, which narrowly averted a federal takeover earlier this year. Meanwhile, more cuts are looming.

"The core of the issue is the proposed 2005 federal budget and the massive cuts to the Section 8 program," said Garrick Ruiz, coordinator for the Save Section 8 Coalition, a newly formed arm of the L.A. Coalition to End Hunger and Homelessness.

Altogether, 1,500 people were issued Section 8 vouchers last year in excess of the city's allotment of 44,000 from the federal department of Housing and Urban Development. Those were suspended, and people who've been on the waiting list face added delays as a result.

In L.A., part of the problem was that officials had not anticipated so many voucher recipients would find rental units. In addition, the housing authority made an agreement with L.A. County to issue vouchers to people making the transition from homelessness and recovering from AIDS, increasing the load.

To date, about 500 of the 1,500 lost vouchers have been replaced with vouchers from housing agencies in other areas. The rest, like Sims-Starke, have searched out friends or relatives, found temporary situations or wound up in local shelters.

To further control costs, the city housing authority is reducing the subsidy amounts to voucher-holders. It has also asked landlords to rein in their rent increases.

Affordable housing advocates, pointing to decisions by Congress and the Bush administration over the last several months, say it's only a matter of time before the cuts hit even harder.

Last year, Congress eliminated the ability of housing agencies that had over-allocated vouchers to tap other HUD funds to make up the difference. Members had expressed concern that more housing authorities across the nation were exceeding their voucher allocations. This move is what forced L.A. to drop many of the excess vouchers from its rolls.

Then in February, HUD issued new rules that converted the funding formula from a system based on the number of vouchers to one based on overall dollar cost. The move was in response to a nationwide 23 percent run-up in the cost per voucher nationwide over the past two years.

On top of this, the Bush administration has proposed transforming the Section 8 program into a block grant program, arguing that the current system is inefficient and burdened with too many regulations emanating from Washington.

But housing advocates fear Bush is actually is setting the stage for sharp reductions in Section 8 funding. If that happens, they say, the federal government will be reneging on a 40-year-old commitment to helping the poor find housing.

Meanwhile, landlords who developed their buildings with federal subsidies by agreeing to accept tenants with Section 8 vouchers have been converting their units to market rate housing, a trend that was most acute a few years ago.

But the Section 8 troubles in the city of L.A. have extended far beyond federal funding cuts. Over the years, landlords and tenants have grown increasingly frustrated over endless paperwork delays in processing vouchers.

"It's been terrible for the owners," said Arnie Corlin, a property manager who heads the Section 8 subcommittee of the board of the Apartment Association of Greater Los Angeles.

With so many mom-and-pop landlords in Southern California, a delay in rental payments on one or two units can have a severe impact on their income. "Some end up in default," he said.

Late last year, revelations about the over-allocations of vouchers and the existence of a $63 million reserve fund prompted HUD to examine the L.A. Housing Authority's books. Under the threat of federal intervention, the housing authority signed a memorandum of understanding with HUD that required the agency to overhaul its administrative staff and end its practice of over-allocating vouchers.

Longtime Section 8 program director Steve Renahan was moved to another program. Interim director David Clark said the agency is working to revamp the program and to improve customer service.

Among the steps being taken: reducing the percentage of rent covered by the housing vouchers and requiring landlords to conform to the city's rent stabilization law, which limits annual rent increases to 3 percent.

"Fortunately, we have that $63 million reserve that can now help us through this." Clark said.

Corlin agreed that for the most part, the most troubled areas are improving. But past problems, along with uncertainty over future cuts from Washington, have caused some local owners to shy away from taking on new Section 8 tenants.

In the buildings he owns or manages, Corlin said, the number of Section 8 units has declined to 12 from 25 a few years ago.

"If I'm looking at somebody, I've got to scrutinize them more," he said. "If Section 8 is out, is that person somehow or another going to be able to come up with that rent?"

Then there are the human costs.

Sims-Starke was hoping to get the Section 8 apartment into place so she could begin bringing her mother, who had been treated for breast cancer, to follow-up radiation therapy within the time-frame doctors said she needed. Without a car, the cost of shuttling her mother back and forth from L.A. to Lake View Terrace near Pacoima would have been prohibitive.

Two weeks ago, their hopes for the apartment dashed, Sims-Starke and her husband sought to arrange for the treatments anyway. But the doctors told her mother it was too late.

"The wreckage of our past keeps us from being fruitful in the future," said Thomas Starke, 44, summing up a situation he still hopes to overcome.

ADVOCATES

Elenore A. Williams

Chairwoman, Board of Commissioners

Housing Authority of the City of Los Angeles 

'MY day job is president and CEO of Habitat for Humanity Los Angeles. We've built 100 units since 1991. With HACLA, I run our board meetings twice a month. It's volunteer-based, so I'm just trying to give the staff some direction, some expertise and address affordable housing in L.A. on a large scale. We help very-low-income families that receive Section 8 vouchers.

"After the former executive director Don Smith stepped down (following the agency's overallotment of vouchers that had to be rescinded), I have needed to step up my leadership role. We brought in an acting executive director to handle the day-to-day operations, Judy Luther, while we continue our search for a new executive director.

"Now we're looking at what we do to make sure that doesn't happen again in the future. The federal budget cuts haven't changed, so we're dealing with HUD funding cuts.

"The biggest obstacle to meeting the need for affordable housing is the fact that we don't have enough housing stock. There's a huge demand."

Beth Steckler

Executive Director

Livable Places

'M0ST of what I do is talk to people in the general public and also in local government about affordable housing and development. The general public tends to think of public housing, but that is not the kind of affordable housing that we build today and that we've built over the past 20 years. The buildings are smaller, they're better managed, the tenants are by and large working people.

"One of the things I tell people is we're the victims of our own success. If you have a well-managed affordable housing apartment complex, people drive by and think there's no affordable housing in this neighborhood. It's more invisible."

Jan Breidenbach

Executive Director

Southern California Association of Non-Profit Housing 

'THE core of our membership is non-profit community development corporations building housing, along with other economic development and social service projects. They build multifamily, single family, SROs, senior and special-needs housing. In addition, we have for-profit developers, lenders, local governments, social service agencies and individuals in our organization. Our members operate in L.A. and the surrounding counties and have produced about 60,000 units.

"We track the housing crisis and what is being done or not done about it. Our primary focus is rental housing for the lowest-income people. The affordable housing crisis now is both better and worse than 10 or 20 years ago. It has worsened as a result of the ever-increasing income gap. The situation is better because the city at least is taking a lead in addressing the production crisis.

"It's fabulous that downtown is getting the attention that it deserves and becoming a vital part of our larger city. My concern is that the housing that includes affordable units is quite limited compared to the need. And if downtown is revitalized without incorporating the poor who already live there, or without providing housing for the thousands of low-wage workers on whose backs much of the revitalization depends, then it is not revitalization, it is gentrification and a shame on our city."

--Matt Myerhoff and Rebekah Sanders