Honolulu's poor face housing crisis as Section 8 agreements

Tom Boland (wgcp@earthlink.net)
Thu, 13 May 1999 14:36:24 -0700 (PDT)

FWD  Honolulu Star-Bulletin Local News - Tuesday, April 20, 1999


     Section 8 housing agreements are about to expire,
     and could leave residents without affordable homes

     By Gordon Y.K. Pang

Shao Qun Lin, her fingers crippled with arthritis, can earn only about $200
a month as a dishwasher, and receives some $400 in various government

Lin, 66, pays $140 rent for her one-bedroom apartment, with the rest
subsidized through federal housing assistance.

Like her neighbors in Chinatown's Maunakea Tower Apartments, Lin is now
worried if she'll be able to stay in her apartment after August, when a
20-year Section 8 agreement between her landlord and federal housing
officials expires.

Without a Section 8 agreement, the landlord could raise rents to market
rates or even convert the building to a fee-simple condominium project.
Under Section 8 rules, renters pay no more than 30 percent of their income
for rent.

"I may have to go back to China," Lin said.

The Affordable Housing and Homeless Alliance says the 380-unit Maunakea
Tower, on Maunakea Street across from the Chinatown Cultural Plaza Shopping
Center, represents the largest number of Section 8 units in a single
complex which could be converted to market housing in the coming year. The
agency fears some 2,000 of 3,274 Section 8 units statewide will go the same

Kathleen Hasegawa, executive director of the Affordable Housing and
Homeless Alliance, said the Section 8 program was attractive to developers
in the 1970s because of incentives such as low-cost loans and rent

But 20 years later, even with Hawaii's poor real estate market, it doesn't
make sense to keep the units in Section 8, said Maunakea Tower resident
James Del Rio, a self-employed Realtor."It costs $120,000 to build these
units," he said. "Apartments are much more efficient to convert than to
build new."

HAPI Management Inc. has not said what will happen come August. No one from
the California-based firm could be reached immediately for comment.

The housing alliance, along with the Legal Aid Society of Hawaii, is
attempting to band the residents of various Section 8 buildings together to
lobby the Legislature to create incentives that would convince the
landowners to keep their units in Section 8.

Federal help is also being sought by the national office.

The housing alliance and Legal Aid were to hold news conferences today in
20 U.S. cities, including Honolulu, to bring attention to the issue.

The local news conference was to take place at the McCully Circle
Apartments, a 99-unit building which is under a Section 8 agreement through
February 2000.

Hasegawa said that on average, rents for apartments that convert out of
Section 8 go up 57 percent.

"It's a train wreck in slow motion," said Craig Castellanet, a Legal Aid
official. For many of those tenants whose apartments will convert, "this
will relegate them to slum housing."

A bill introduced in the state Senate would provide some protection,
Castellanet said.

The measure would require landowners to give tenants a year's notice if
they decide not to renew Section 8 status.

The bill also would require a landowner choosing to sell a previously
Section 8 complex to give first right of purchase to a government,
nonprofit or tenants' interest group.

Castellanet said the state also loses when Section 8 agreements are
discontinued because it would need to pick up the burden caused by the lost

Chun Ching Tsang, 74, said she won't have anywhere to go if her rent goes
up. With Social Security, food stamps and other benefits, she estimates her
total monthly income is about $500.

She pays $120 a month for her one-bedroom unit at Maunakea Tower.

With food, medical and utility bills, Tsang said, there's no extra money
for a rent increase.

Tsang, who came from China in 1975, said she has adult children. But she is
reluctant to ask them for financial help when they now have their own
families to raise.

"Everyone has to help themselves," she said.


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