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Many Southland Workers Fall in Gap Between Income, Rents

Minimum wage is not enough as housing costs climb, report says


Armando Mantilla labors about 40 hours a week as a pastry chef at a Tarzana catering company. But he's not even close to being able to afford a standard two-bedroom apartment in the Los Angeles area. A low-wage earner such as Mantilla would have to log 84 hours--the equivalent of more than twice the standard workweek.

For the fourth consecutive year, the minimum wage was insufficient to cover the rent for adequate housing anywhere in the U.S., and Southern California has one of the widest affordability gaps, according to a study of 2001 statistics released Wednesday by the National Low Income Housing Coalition.

The Washington-based advocacy group for the poor found that U.S. workers must earn at least $14.66 an hour--almost three times as much as the federal minimum wage of $5.15--to pay rent on a standard two-bedroom apartment. California's hourly minimum wage was increased this year by 50 cents to $6.75, but that still is less than half of what renters need to earn to afford a standard apartment in the Los Angeles region.

Last year, the average rent for a two-bedroom apartment at the low end of the rental market climbed 5.7% to $1,088 in Los Angeles County and 3.1% to $1,141 in Orange County, the study found. The data were gathered by RealFacts, a Novato, Calif.-based firm that tracks 5,500 apartment complexes in the western U.S.

For The Record
Los Angeles Times Friday September 20, 2002 Home Edition Main News Part A Page 2 National Desk 8 inches; 292 words Type of Material: Correction
Housing official--Steve Renahan is the director of the Section 8 program for the Housing Authority of the city of Los Angeles. He is not the director of the Housing Authority, as reported Thursday in a Business section story on low-income renters.

In Southern California, about 862,000 workers--or 10.9% of the work force--last year earned within one dollar of the state's then-minimum wage of $6.25 an hour, according to the Economic Policy Institute, a Washington think tank.

Because rents have risen so fast in and around Los Angeles, many families have been forced to cram into one-bedroom units with other families or to live in substandard dwellings. Low-income housing advocates define a "standard" dwelling as a "no-frills, two-bedroom, one-bath apartment with kitchen and living room." The federal government considers housing affordable when it costs 30% or less of gross income.

The 45-year-old Mantilla, who earns $9 an hour, shares a one-bedroom Los Angeles apartment with his wife, Maria, and their 8-year-old daughter. He struggles every month to pay his $325 rent out of a $1,420 monthly paycheck, which also must cover medical bills for Maria; the 44-year-old has cancer and does not work. Mantilla also sends $575 a month to relatives in Mexico, forcing the couple to rely on the local church to feed them.

"I recently found a slightly better apartment for $575, but that's too much for me," Mantilla said. "The cheaper ones are dirty and terrible."

Rod Field, executive director of the Los Angeles Housing Law Project, cautioned that the situation for many people isn't going to get better any time soon. The problem is "getting worse," Field said.

The elderly and single moms "are just desperate," he said, "especially those being evicted."

That's just what happened to Morena Gonzalez, 27, who was tossed from her Los Angeles apartment last month after failing to make the rent on the one-bedroom unit she shares with her three young children. The single mother, who works at a bakery, earns $290 a week, which, along with a $674 monthly welfare check, must cover her $750 rent at a new place and $400 in monthly child care bills.

"My old apartment had rats and cockroaches," Gonzalez said. "Thank God I have this place now, but it's more than I can afford."

Compounding the problem, analysts say, is that federal subsidies on an increasing number of apartments set aside for low-income tenants are scheduled to expire between now and 2006. When these subsidies go away, apartment owners are free to quit the federal program, putting even more pressure on low-income renters.

Los Angeles County lost 6,000 federally subsidized, or Section 8, housing contracts last year, and about 4,000 units have been lost this year, said Steve Renahan, executive director of the Housing Authority of Los Angeles.

Additional housing would help ease the situation, but construction of multifamily units still lags in Los Angeles County. The county's population grew by 160,000 last year, but only 9,926 permits for new multifamily units were issued, said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp.

The number of building permits issued for multifamily units is running behind by 18.7% compared with last year at this time, further exacerbating an already desperate situation, Kyser said. The major factor there is cost. "Prices for developable land are going through the roof. It's scary," Kyser said. "We're not going to solve the problem soon, either. In 2010, we'll be writing the same story, unless there's a dramatic change."

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