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Tough spot. Sounds a bit fishy to me too. Maybe she got a voucher increase, and found another home/area she likes better. However, if you can verify her story (witness accounts, bullet holes, etc.), I would consider letting her out of the lease early, but not until another tenant is secured. Of course I would also retain any/all security deposits. You might call her sec.-8 case worker, and see if an agreeable solution can be reached.
FYI - If you can pull rental comps and substantiate it, you can negotiate rent increases directly with the caseworker (or their supervisor) as well.
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