@Jonathan Greene, can you tell me one of the more notable times this happened and how it finally resolved?

Finally.

After a week or so of looking through the other threads I finally found the Canadian forum.

-Initial basement costs were projected at $60K, final costs were $125K.

The experience of the housing provider is going to be the real challenge to getting you a set of keys to move in with...they have to qualify, pass inspection, sign a bunch of paperwork, and finally lease up and send everything into LMH. 

Finally- you can eliminate 95% of the troubles and risk by simply having professional and legal screening and management processes, so don't sleep on that piece. 

My worry is that while I am clear on the risks (extended timeline to get a tenant in, and expensive buildout) that I am not being nearly conservative enough - do I risk this thing sitting empty for a year, or years, and finally renting well below my implied rate? 

When you finally get them on the ropes, they pack up and move out never to be seen again.

I finally took the plunge and have become a real estate professional.

After multiple calls and emails about the matter (even involving the local HUD office), I finally get a response that says "Unfortunately, HACW is experiencing a temporary shortfall of funding and will be unable to pay the HAP amount for this month..."