Advocates Vow to Continue Campaign for Rent Subsidies : Budget: After setback in Senate, groups plan to lobby legislators in hopes of influencing joint House-Senate conference.

WASHINGTON — Although they lost a key vote Wednesday in the U.S. Senate on a program that provides federal rental subsidies to low-income tenants, housing advocates say their fight to keep the program alive continues.

Senate Republicans had attempted to overhaul the housing program in the 1996 budget, but when their reform proposal proved too costly, they decided not to dole out any money for the program next year. To save money, they would begin funding the program again in October, 1997.

However, that one-year gap in funding, housing advocates contend, would enable landlords to significantly raise rents beyond current restrictions, forcing out many tenants. The housing program subsidizes low-rent apartment buildings across the county, but the Los Angeles area would be especially hard hit if the program were cut--with about 10,500 units at risk, according to city officials.

Discouraged but not defeated, housing advocates say they intend to lobby legislators in hopes of influencing the joint House-Senate conference that will draft final details of the housing funding. The House had authorized $200 million for the preservation program next year, roughly one-third of the current year’s spending.

“I am moderately optimistic that there will be some funding next year,” said Charles L. Edson, counsel for the Institute for Responsible Housing Preservation. “I don’t know how much.”

Congressional staffers working on the issue say it is not too late for some sort of funding to come through for next fiscal year. But they emphasize that the budget is so tight that any money going to the housing preservation program will mean cuts somewhere else.

The Low Income Housing Preservation and Resident Home Ownership Act provides low-interest mortgages to landlords who agree to provide reduced rents for low-income tenants. Owners who want to get out of the subsidized program are required to offer to sell their units to the tenants or to a nonprofit group working on the tenants’ behalf.

Renters in the subsidized units fear that unless the program’s funding is restored, landlords will take advantage of the opportunity to raise their rents or will leave the program and ruin efforts by some renters to buy their buildings.

Kept in the dark about the fate of the housing preservation program, tenant organizations and housing officials in Los Angeles remained anxious about the future.

“If I were to draw a cartoon of this,” said Don Henkel, president of a Department of Housing and Urban Development senior citizens tenant group in Sylmar, “I’d draw a picture of very low-income people and disabled people, and draw the Senate holding an ax over our heads.”

Henkel and the other senior citizens at Valley Pride Village in Sylmar hope to use HUD-guaranteed loans in partnership with a nonprofit housing developer to buy their building, a well-landscaped complex located in a mixed-income part of town.

But if the money is not there, they do not know what will happen.

Like the tenants at Valley Pride, residents at Silver Lake Plaza in Silver Lake had hoped to buy their building to keep the rents low. But the owner, according to tenants and city housing officials who are familiar with the situation, seems to be counting on the fact that no funds will be appropriated for the housing preservation program next year, allowing him to sell the building and raise rents.

“There are people here who make $490 a month on [Aid to Families With Dependent Children],” said Renne Rubio, a 59-year-old diabetic who is blind in one eye. “Right now, some pay $311 in rent. We got notices saying that the new rent would be $760 beginning Nov. 1.

“Without them voting funds for next year,” Rubio said, “people will be homeless.”

Buck Bagot, a consultant who is helping the residents of the Sylmar complex, says the key to the fight will be tenants contacting their legislators.

“We’re trying to bring pressure in the home states of the key Republicans,” said Bagot, who is on the executive board of the National Low Interest Housing Coalition. “Right now, thousands of tenants are writing letters and getting involved. That is making me optimistic.”