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LA prepares for 600,000 applicants to subsidized housing program; only a fraction will get help

File photo: A "For Rent" sign is seen on a building Hollywood, California, May 11, 2016. Angelenos are feeling the increasing burden of rising rents and threats of eviction as forecast indicate rent prices will continue to rise through 2018.
Robyn Beck/AFP/Getty Images
FILE PHOTO. A "For Rent" sign is seen on a building Hollywood, California, May 11, 2016. Rental assistance is in high demand in Los Angeles, but few will win the lottery for a Section 8 voucher.

In yet another sign of L.A.'s growing poverty and lack of low-income housing, local officials are preparing for a torrent of applications when they open up the wait list for federal housing aid later this year. 

The city stopped taking applications for Section 8 housing over a decade ago because there were too many people already waiting for the limited rental assistance vouchers.

Last time L.A.'s waitlist opened, in 2004, about 300,000 people applied. When the process opens for a two-week window this year, officials are expecting at least twice that number. As a result, only a fraction of people who apply will make the cut.

"It's like a perfect storm," said Carlos VanNatter, director of the Section 8 program at the Housing Authority of the City of Los Angeles. "We have a ton of people who are eligible income-wise and need the assistance, but we don't have that much assistance to give."

Section 8 vouchers typically require the user to pay 30 percent of their income towards rent, with the U.S. Department of Housing and Urban Development paying the rest. To qualify, a family or a person must receive very little income—a maximum of $45,050 for family of four, for instance.

At least 800,000 people in Los Angeles meet the income requirements for Section 8, VanNatter said. 

The problem is not unique to Los Angeles. High demand for vouchers has led to some disasters when wait lists opened up elsewhere in the United States. In 2010, in East Point, Georgia, about 30,000 people reportedly showed up at the housing authority the day the waitlist there opened, leading to crowd control issues. Last year, in Portsmouth, Virginia, officials had to cancel an in-person application event after thousands lined up and some suffered from heat exposure. 

Even taking the application process online, which L.A. plans to do this year, is not a guarantee things will go smoothly. When Santa Ana opened its wait list in 2015, the surge in web traffic crashed the server.

"We broke the internet," Judson Brown, operations supervisor at the Santa Ana Housing Authority told KPCC at the time.

VanNatter said L.A. is in the process of finding a contractor who can handle the expected online traffic and connect with people who may be eligible for Section 8—particularly non-English speakers and senior citizens who may need help with an online application.

But even those who apply have a small chance of getting help. The contractor will pull names at random in a lottery to determine which of the applicants get on the wait list. Officials said they expect to pull about 20,000 names, but haven't settled on a number.

"Just to be realistic to ourselves and applicants, we're not going to have a waitlist of 600,000 people," VanNatter said.

The city has a stock of about 50,000 vouchers, of which about 2,400 become newly eligible during any given year as people leave the program. Nearly half those are set aside to house homeless in permanent supportive housing developments. 

But as L.A. steps up its funding of new housing for homeless with bond money from Proposition HHH, which passed in November, it's likely a larger percentage of the Section 8 vouchers will be used for the homeless, leaving only about 400 a year to be awarded to people on the wait list who are poor and struggling, but not yet homeless.

Budget cuts are also a concern. The current iteration of the president's proposed 2017-18 federal budget envisions a 3 percent cut in the program, which was already cut 5 percent last year.

VanNatter said a cut like that can result in a loss of about 5,000 vouchers. 

Meanwhile, getting a voucher is not necessarily a guarantee that a person will be able to use it. With a 2.6 percent vacancy rate in the city, it's been hard for voucher holders to find apartments. Only 60 percent find a landlord willing to take them, compared to 75-80 percent a couple years ago.

The homeless program offers additional incentives to landlords willing to take them, like damage guarantees beyond a security deposit as well as signing bonuses. Those incentives have been funded by the city and are expected to continue with money from Measure H, a sales tax hike for homeless services that kicks in Oct. 1. They only apply to vouchers for the homeless, not those who are simply poor.