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Santa Clara County’s Section 8 voucher program upended by tight rental market

SAN JOSE — Within the caring community that looks after the needs of Santa Clara County’s homeless — a diaspora of 7,613 luckless souls, according to the latest official count, huddled in creekside encampments, sleeping in cars and hidden under bridges — Section 8 vouchers once were considered the “golden ticket” to a permanent home.

But since the county’s housing authority began distributing 54 of the prized vouchers, a 1 percent vacancy rate in the rental market has turned the gold ticket into an empty promise.

As of Friday, only one of the 54 vouchers — a guarantee to landlords of prompt payment from a tenant whose reliability is closely monitored by a caseworker — was known to have gotten a homeless person off the streets and into an apartment.

In the five decades that the Santa Clara County Housing Authority has administered Section 8 vouchers, this is one of the toughest times ever for the program, said Katherine Harasz, the authority’s deputy executive director. And the squeeze is hampering a special effort by the agency to focus its resources on the area’s homeless.

The exception is Jeri Lyn Roy, 47, who has been living in a tent on a golf course. She used a voucher she received seven weeks ago to secure a one-bedroom apartment, sight unseen, last week. “This changes everything,” she said excitedly a day after seeing her new place for the first time. “This is the opportunity I’ve been waiting for.”

It’s an opportunity that has not been shared by the 31 homeless veterans, and 22 other chronically homeless people, who received Section 8 vouchers from the same batch as Roy. Another 27 vouchers are expected to be distributed soon, and the scramble for suitable housing has grown so desperate that EHC LifeBuilders — which runs a network of homeless shelters — placed an ad on Craigslist seeking willing landlords. After one week, the agency had not received a single call.

“That’s how bad things are,” said EHC’s Shelly Barbieri, who placed the ad. The vouchers are capped by a “fair market rate” formula — $1,315 for a one-bedroom — but as anyone who has tried to rent an apartment in Silicon Valley lately knows, the “fair” rate is whatever the market will bear.

Voucher holders pay a set percentage of their income — 35 percent — toward rent, and the voucher makes up the rest, up to the cap.

“The average cost for a one-bedroom that we’re running into is $1,700 a month,” Barbieri said. “Unfortunately, there’s a large stigma to somebody who’s homeless. It’s a very hard to sell to a landlord that an individual who has been on the streets for 10 to 15 years is going to make a great tenant.”

When the vouchers are issued, the candidates for housing are offered counseling on how to present themselves, and provided lists of apartment complexes that are Section 8-friendly. The vouchers are supposed to be good for only 60 days, but this summer, many have been renewed several times.

“It’s a very long search,” acknowledged Harasz of the Housing Authority, which allocated 100 vouchers in conjunction with Destination: Home’s Housing 1,000 program, a local program aimed at housing 1,000 chronically homeless this year. “As long as they’re searching, that subsidy is going unused. And they’re in great demand,” she said.

Harasz said her agency has a waiting list that has remained “stagnant” at 25,000 since 2006. Veterans and the county’s chronically homeless have been moved to the front of the line to address what she called an “urgent problem.”

That urgency has been building since the national economic meltdown in 2008, followed by a wave of foreclosures that put more people into the rental market, and reduced developers’ access to credit markets, which brought housing construction in San Jose almost to a standstill.

“In San Jose, just to keep up with our population and demands for housing, we need to be building about 4,000 units a year,” said Leslye Corsiglia, director of the city’s Department of Housing. “We didn’t come anywhere near that. So there’s a lot of demand for the units that are available.”

Building permits for new construction in San Jose declined from 1,970 in 2008 to 307 the next year. By 2012, building had resumed, with 3,500 permits issued. But much of the construction was luxury housing along the tech corridor on the city’s north side. At the new Domain Apartments, rents for a one-bedroom start at $2,300. “That’s the kind of project that’s going in,” Corsiglia said, “so it’s not going to help people who have a voucher.”

Another factor over which housing officials had no control was the sequestration of federal funds after Congress played chicken with the budget this year. Harasz said that about 20 percent of the 17,000 voucher holders in the county received notice this summer that their subsidy was being reduced, sending them back into the market. She said she was relying on the “compassion” and “altruistic nature” of landlords.

Really? The altruistic nature of landlords? “I know, I know,” she sighed. “That’s why it may not compute.”

The stalemate between invaluable vouchers and a tick-tight market clearly caught advocates for the homeless off guard, and no one seemed quite certain what to do.

“Solutions like Section 8 are the gold standard intervention for homelessness, and we can’t use them,” said Jennifer Loving, executive director of Destination: Home. “It’s a guaranteed permanent subsidy, so it’s not like landlords are really taking a chance on whether or not the person can pay the rent.”

After seeing her new home, Roy declared it “gorgeous,” after fearing voucher housing meant she would end up in a dive. “I cannot tell you,” she said, “how tickled I am.” And then she did.

Contact Bruce Newman at 408-920-5004. Follow him at Twitter.com/BruceNewmanTwit.