State and local governments are overwhelmed by the task of launching programs to review thousands of applications from renters and landlords.
Landlords and tenants are waiting weeks and even months to receive their share of billions in pandemic rent relief as state and local authorities struggle to distribute the funds, The Wall Street Journal reported Tuesday.
In March, Congress passed a $1.9 trillion coronavirus relief package that included approximately $50 billion in Emergency Rental Assistance (ERA) for an estimated 13 million struggling renters. Renters need to meet certain requirements to qualify for the assistance, including at least one member of the household experiencing unemployment or other financial hardship as a result of the pandemic, at least one member of the household proving risk of housing insecurity, and proof that the overall household income is at or below 80 percent of the area’s median income.
While the assistance was heavily lobbied for by housing and real estate groups, including the National Association of Realtors, its rollout has been rocky. A number of landlords are actually turning down payments because of the various regulations attached. Restrictions like not being allowed to get rid of difficult tenants or having to provide government agencies or contractors with sensitive financial documents have deterred some landlords from accepting the assistance. The process also requires a decent amount of administrative work and documentation, which can be time-consuming.
On the administration side, state and local governments are overwhelmed by the task of launching programs to review thousands of applications from renters and landlords and dole out unprecedented amounts of money — a process that is taking weeks to months. In Orange County, California, for instance, the county opened applications to tenants Feb. 1 and cut the first checks to landlords the week of March 15, according to the WSJ. The county received more than 10,000 applications, most of which are still being reviewed, the paper said.
North Carolina’s Office of Recovery and Resiliency, typically staffed by 60 people, has hired more than 200 temporary employees to help distribute its $546 million share of the funds, according to the Journal.
“To have to stand up a new program within a few days or weeks, knowing that people were at risk of homelessness or eviction, or spreading the pandemic because they’re moving as a family…This is on a scale that no one’s seen,” Laura Hogshead, the agency’s chief operating officer, told the Journal.
Meanwhile, although the Biden administration extended a national eviction moratorium until June 30, as renters wait for assistance to reach them back rent continues to accumulate, leaving open the possibility that they’ll be evicted later.
And landlords who have burned through their reserves and savings — first due to an eviction moratorium that contained no funding for rental assistance and now to programs that are either barely or slowly getting off the ground — are exploring what may have seemed unthinkable a year ago: selling an income-generating asset that has provided wealth over generations.
For example, the Journal spoke to South Los Angeles residents Tammie Mason and her mother, Faye Dedmon, who own a rental home that has been in their family for more than 50 years, but whose tenant owes nearly $30,000 in back rent. They can’t evict him because of the moratorium and the city of Los Angeles only opened up applications to distribute rental assistance on March 30. The mother and daughter applied right away but haven’t heard back.
“We’re going on more than a year and we have not received any relief, so unfortunately we have no choice but to sell,” Mason told the Journal.