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By Niki Cervantes

Staff Writer

September 28, 2016 -- A last-chance effort primarily aimed at saving Santa Monica's elderly and poor tenants from eviction because they can’t make the rent has stalled before it could start, after the City learned need far outstripped funding.

A one-year pilot project, “Preserving Our Diversity” (POD) was meant to keep the poorest tenants, including those in Santa Monica’s rent-controlled apartments, from becoming homeless, and the City hoped to start providing subsidies soon, said City Housing Administrator James Kemper.

But staff asked that recommendations to support POD be pulled from the City Council’s Tuesday agenda, having come to grips with a hard reality:

Of an estimated 6,325 “very poor” households in Santa Monica using at least half their income for rent, POD could only reach 27 of the most extreme cases with its proposed subsidies of about $611 a month, or $7,332 a year.

The tenant’s remaining cost would be $343 monthly, the report said.

“We need to begin redefining” POD, Kemper told the Lookout on Tuesday. “There are so many vulnerable people. It’s like playing God. How do you decide who gets what?”

But POD isn't likely to offer subsidies over the long term in any case, said Andy Agle, the City's Director of Housing and Economic Development.

Even in a City with a biennial budget that now tops $1 billion, POD is unaffordable, he said.

The program is earmarked for $300,000in City funds, although a third is for administrative costs.

“Ultimately, there is insufficient local resources to indefinitely continue, much less expand, such a program,” he said in his report. “It is hoped that what is learned from this pilot will help frame future regional, State and even Federal policy to address the challenges of affordable housing for millions across California and the nation.”

Meanwhile, Kemper said the City’s Housing Commission has asked for another look at POD, which originated during the advisory panel’s intensive study of the City’s critical shortage of affordable housing, which concluded in December.

Kemper said POD is now likely to be revised and sent to the council again in November, with a start date shortly thereafter or in early 2017.

Council Member Kevin McKeown said the City remains confident in POD -- a rare program because cities often leave the provision of housing subsidies to other levels of government, no matter the local need.

“This long-needed assistance for seniors, the disabled, and other fixed-income renters is still very much alive,” McKeown said.

But, he said, “it’s crucial that this new and very promising program be designed for effectiveness to justify the anticipated ongoing funding once the pilot program succeeds."

The version of the program put on hold could have reached as many as 79 households whose tenants faced losing their homes, a report to City Council said.

But that would have required three times as much City money for subsidies, or $579,228, not including more funding for administrative costs, Agle said.

As part of its $614.1 million spending plan for the 2016-2017 fiscal year, the City Council in June allocated $200,000 in subsidies for POD, plus $100,000 for administrative costs.

Agle said a key rationale for the subsidies was to stem the ongoing loss of rent-controlled units, which jump to market rates when vacated.

Under Agle’s recommendations, the program focused on tenants with “extremely” low-incomes of $18,250 for a one-person household, which is less than 30 percent of the median income.

Tenants also were required to be heavily “rent burdened,” using more than half of their gross income for rent, and to have lived in a rent-controlled apartment for at least 10 years.

None were already receiving government housing subsidies or lived in units designated “affordable,” he said.

A City survey this summer prompted only limited responses, but Kemper said the results were worrisome nonetheless.

The results showed 76 percent the 433 households included in the survey were rent-burdened and, of those, more than a third “severely rent-burdened.”

The average age was 68, the average household was 1.2 persons, the average monthly rent was $954 and average monthly income was $1,144, or $13,728 a year.

The rent-to-income ratio was 83 percent, the report said. The households were not concentrated in any particular neighborhood.

Kemper said it is hard to grasp how those tenants survive after making their rent payments

“When you have so little left…” he said. “Do they go to food banks? We need to know more."

Agle’s report suggested options for POD that reduce, rather than eliminate, the rent burden for endangered tenants.

For instance, he said the program could reach 33 households by establishing a threshold of 40 percent of the median income, although the tradeoff would be smaller subsidies averaging $496 a month.

He said the program could help out 43 households by moving to a 50 percent threshold, or $30,400 annually for a household of one. Or it could it provide a set monthly subsidy ranging from $500 to $300, depending on the income level of households, the report said.

Whether POD could wrest more funding overall, though, is not an easily answered question.

McKeown did not respond by deadline when asked by the Lookout if the City can provide more funding, or can afford to do so.

Kemper also said he preferred not to comment, noting the answer is the job of elected officials to determine.

But Agle’s report pointed to the importance of the program.

“While there is risk in stepping into that gap, the downside risks of not exploring new solutions leaves many Santa Monica households vulnerable,” he said.

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