Despite receiving millions of dollars in federal stimulus money, many public housing authorities across the nation are being forced to reduce their help to the country's poor. In Utah County, that means 125 families will see the government subsidy of their rent disappear starting September 1.
In housing lingo, they've been "terminated."
Mary Dyer, a single mom who was just fired from her call center job, was floored when she learned the news.
"I don't have any family here -- I don't have any resources," the pregnant woman said. "I am just completely lost."
Section 8 is a federal program that typically allows impoverished families to pay 30 percent of their income toward rent. The housing authority makes up the difference. But as people have lost jobs and seen their income go down, housing authorities have been forced to shoulder a greater portion of the rent, which can drain their coffers.
Further complicating the problem, agencies didn't know how much U.S. Department of Housing and Urban Development Section 8 voucher funding they would receive until this May. In many cases, the amount was far less than expected, officials said.
And federal stimulus money -- which has been pouring into housing authorities by the hundreds of thousands -- is earmarked for maintenance and improvements, not Section 8 assistance.
Utah County Housing Authority officials recently realized that their cost per household had shot up, the number of clients remained high and federal funding was down. If the authority did nothing, it would be about $300,000 over budget by the end of the year.
So last week, letters went out to 125 households that rely on the housing authority for help with their rent. In general, those who had been on the subsidized rent program the longest were selected. Many people had relied on Section 8 for 10 years or more.
Some people were automatically exempted from losing their subsidy, such as the elderly and the disabled.
This was not an easy decision to make, officials said.
"When you don't have the funding you need to continue to operate, there aren't many alternatives," said Gene Carly, executive director of the Utah County Housing Authority. "I regret very much it's come to this."
As housing and community leaders have become aware of the impending rent problem, they are discussing what other federal monies may be available. One issue is whether homeless prevention money that is part of the federal stimulus effort could be used to keep people in their homes.
But the National Low Income Housing Coalition believes it is misguided to use homeless prevention dollars to solve the Section 8 shortfall.
"That money was not issued to backstop the Section 8 program, which HUD has been administering since 1974," said Linda Couch, the organization's deputy director. "It seems like [the federal government] would know how to make sure what we spent on vouchers last year ... is what we would need this year."
Utah County is far from alone. Federal officials have been having what they're calling "triage" conversations with housing authorities nationwide. Several hundred are reportedly facing the same choice of eliminating clients, paying less per household or using reserve dollars.
Though other Salt Lake Valley agencies aren't in the exact situation that Utah County faces, they are feeling similar pressure.
In West Valley City, about 10 new applications for Section 8 arrive each day. The waiting list is now so long that it can take as much as four years to get a voucher.
With the economic downturn, the Salt Lake City Housing Authority is more frequently paying 100 percent of rent after people lose their jobs.
In Madison, Wis., the housing agency has begun contributing less to most clients' rent, meaning renters are paying more. The city council may step in with some additional funding, but it will take a few months to take effect.
"We're hoping people can hang on until some kind of rescue can be put together," said Tom Conrad, manager of the Section 8 program at the Community Development Authority for Madison.
Utah County is also hoping to find a solution, whether it's with homeless prevention dollars or through the help of another housing authority.
"I don't want to give false hope," Carly said. "But I haven't given up."
What is Section 8?
The federal program typically helps poor families limit their rent payments to 30 percent of their income. But with budget cuts and lost jobs, housing authorities have been forced to spend more.