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Santa Monica Council Approves Experiment in 'Last Resort' Subsidies for Elderly Poor Renters

 
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By Niki Cervantes
Staff Writer

July 28, 2017 -- The Santa Monica City Council on Tuesday approved a pilot project of “last resort” subsidies for an impoverished elderly population which, after decades living in rent-controlled apartments, can no longer make rent.

Preserve Our Diversity (POD) was approved unanimously, but City officials acknowledged it will help only 26 households –- out of an estimated 6,000 households in Santa Monica so “rent burdened” they are in jeopardy of eviction.

“There are thousands of people in the same situation,” said Michael Soloff, chairman of the City’s Housing Commission, which first recommended the subsidizes to the council as part of an overall package of affordable housing initiatives in 2015.

“If we lived in an ideal world and had unlimited resources, we could help everyone,” he said. “But we can’t.”

All the tenants included in POD were stringently vetted, said Andy Agle, the City's director Housing and Economic Development.

They responded to a survey sent to all households in rent-controlled apartments and the City thoroughly documented their finances, he said.

All are long-term residents with extremely low-income (earning less than 30 percent of the area median income), rent-burdened (paying over 30 percent of income toward rent) and senior citizens (average age is 68), officials said.

Most live alone, with an average after-rent income of $200 a month, Agle said. Some only eat every other day so they can pay the bills. Others eat only lentils.

POD aims to help tenants pay non-rent expenses, instead of the more typical approach of providing the subsidies to landlords for rent.

According to a report outlining the program, the subsidies will average $740 a month for households of one and $1,293 a month for households of two people.

The payments start in September or October. They are based on the Elder Economic Security Index (http://healthpolicy.ucla.edu/programs/health-disparities/elder-health/Pages/elder-index-2011.aspx), which uses federal data to try to assess the needs and costs of senior citizens.

The POD subsidy is based on households of one needing another $264 for food, $166 for health care, $52 for transportation (the cost of a monthly bus pass for senior citizens), $55 for utilities and $216 for miscellaneous expenses.

On a monthly basis, households of two are determined to need another $490 for food, $332 for health care, $103 for transportation, $55 for utilities and $313 in miscellaneous expenses.

Outside of POD’s participants, though, the need for rental assistance is so extensive the City anticipates expanding the program when it ends its 14-month trial run.

The City can potentially expand the number of subsidies then using funding from a sales-tax increase approved by voters in November for both affordable housing and schools.

The two measures raised the sales tax a half cent (bringing it to 10.5 percent) and splits the $16 million bounty evenly between the City and school district.

No one at Tuesday’s meeting estimated how much more would be spent to add more tenants –- a number which would determine how many more of them could be assisted.

Although the City’s biennial budget is more than $1.5 billion, funding subsidies for tenants is beyond the normal scope of business for Santa Monica, as is the case traditionally for most cities.

Soloff said POD is being watched intently by other localities in Southern California, where stratospheric rents are unaffordable for many lower-income and -- increasingly -- middle-income earners.

POD “could be a model,” he told the council as it weighed giving the program the go-ahead. “It has the potential to be very important.”

Some voiced reservations about the program. Council Member Pam O’Connor warned that the City could be embarking on a new and financially overwhelming entitlement program.

Council Member Gleam Davis said she was concerned about whether subsidies given directly to the tenants would, in the end, keep them in their homes.

“We robbed Peter to pay Paul all the time,” she said as she recalled growing up in an economically hard-pressed household.

“If there’s a medical emergency, you’re not thinking about (rent) at the end of month. You do what you need to do to get through the next 24 hours.”

If POD tenants end up making such decisions, “all of a sudden, our good intentions are not working,” she said.

In the end, she voted for the program, acknowledging extent of the overall problem “is probably worse than we think it is.”

Based on HUD data, the City’s Housing Commission has estimate 6,325 Santa Monica households earning 50 percent or less of the median family income are paying more than 50 percent of their income for rental housing.

 


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