On New Year's Day, one single mom in Indian Hills got a notice that in 30 days her rent may be increased more than 50 percent - raising her rent an extra $260 a month.
The news that her apartment complex lost federal Department of Housing and Urban Development subsidies meant she and the other single parents, seniors, disabled and low-income residents would have to start paying market price for the 23-year-old units.
Highland Manor, a complex of 52 units at the corner of Mica Drive and Vista Grande, was one of six federally-subsidized affordable housing complexes in the area that went without funding beginning in September after Congress failed to pass a budget for the program.
The budget is still unfunded, but five of the six apartment complexes, including the Indian Hills site, got word Tuesday they would receive money for the next few months to help keep the program running. One Reno complex still hasn't been funded.
The drop in funding crops up each year as fewer dollars become available for federal housing programs, said Maureen Cole, contract administrator for the Washoe Affordable Housing Corp., a contract administrator of HUD funds for area complexes.
This year, some program funds in local accounts were wiped out altogether in September after the federal program removed any leftover money in local accounts from the previous year.
"(The federal housing authority) has an inordinate amount of difficulty switching from one year to the next," Cole said. "They do not have enough funds to go around. We have a number of contracts that needed money at the beginning of the fiscal year (Oct. 1). There were some problems getting money attached to contracts that needed them."
About one-fourth of the tenants at Highland Manor are seniors who receive as little as $500 a month from Social Security, qualifying them for utility subsidies and rent reductions. Other residents work regular jobs and some are on welfare.
Tenants who qualified for the federally subsidized complex were looking at paying market rents from $565 to $760, when some now pay as little as $25 a month to live there. With low-income housing scarce in the Carson-City/Douglas area, residents were left with few choices.
"It's upsetting for tenants," said apartment manager Virginia Erickson. "We have quite a few people who live here who really don't even pay rent."
The owner received good news Tuesday. Funding will be restored temporarily and she will be reimbursed for December and January until the U.S. Congress passes an appropriation bill to pay for the yearly program.
Since losing federal housing funding from the U.S. Department of Housing and Urban Development in December, the apartments' owner has dipped into reserve funds to pay employees and pay the mortgage, Erickson said.
Erickson plans to notify residents at Highland Manor their rents will not increase as soon as she gets written word from the regional administrator, she said.
Highland Manor owner Judy Shallenberger filed applications for the yearly funding on time.
"She was prompt in submitting the paperwork," Cole said. "She had everything in place and was simply waiting for the funds."
Residents are affected by the loss of money at the end of the year when owners can't pay utility bills, vendors or employees, Cole said. Every owner, though, pays into a reserve fund for capital improvement projects, like replacing a roof. Some can take loans from the account to help them get through times when federal funding drops off, but it has to be approved through HUD.
Staff at Nevada field offices for the federal housing department did not return phone calls for comment Tuesday.
Contact Jill Lufrano at jlufrano@nevadaappeal.com or 881-1217.
