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What occurred to the $ 45 billion lease aid?

Everyone agreed that rent relief is the only way to prevent a wave of millions of Americans from being displaced.

The logic was simple: give the people struggling during the pandemic the money to pay their rent and landlords would have no reason to evict for nonpayment. That simplicity, and the remarkable unity of the landlord's lobby and tenants' attorneys calling for this kind of relief, prompted Congress to provide $ 25 billion in rental assistance in December. Less than three months later, in early March, they committed an additional $ 21.55 billion for the same purpose.

Despite this unprecedented government aid, people like Emilie Ashbes are still in crisis.

"I'm scared. I'm so scared to spend money," 31-year-old Floridian told me when she was shopping for housewares at Walmart. "I literally donated eggs (rent). I sell body parts."

Ashbes, who says she works 11 or 12 hour non-stop shifts at a Texas roadhouse to afford her $ 1,300 monthly rent, didn't even know she could apply for rent relief.

Technically, it wasn't able to do it until the week before last, when the state opened its application process for rent relief, the Tampa Bay Times reported. Meanwhile, Miami-Dade County, where Ashbes lives, has closed its application program.

This disconnection between Ashbe's situation and federal relief to help tenants like her explains why people are sounding the alarm over a possible flood of evictions if the federal moratorium is allowed to expire (or put down) in the next few weeks.

Getting money into the hands of tenants has been extremely complicated – the National Low Income Housing Coalition has found over 340 different programs trying to manage federal aid. Some programs require extensive documentation. others make it difficult for landlords to apply, and most require tenants to provide a comprehensive proof of needs. And Ashbes is far from unique; Many lawyers Vox has spoken to often don't even know that help is available to them. All of this underscores the difficulty of helping those at greatest risk of eviction.

Parishioners protest evictions outside the Bronx Housing Court in New York on August 10, 2020.

Angela Weiss / AFP / Getty Images

The context of this difficulty is that the federal government has never given tenants so much help. Former President Donald Trump's unprecedented efforts to impose an eviction moratorium by the Centers for Disease Control and Prevention, in addition to expanded unemployment benefits, economic impact payments, and funding for the CARES Housing Stability Act, have millions kept afloat by families. Now, the tens of billions in rent relief is an opportunity to keep millions of people in their homes and an extraordinary challenge for states and communities, many of which have never provided this type of assistance before.

With the federal eviction moratorium expiring in late June and several judges previously attempting to crush it, states may only have a few weeks to get money into the hands of tenants before eviction proceedings begin in serious again.

Not a single expert or attorney Vox has spoken to believes the money will be allocated by then.

Billions in rent back are owed. The states have difficulty distributing a fraction of it in rent support.

"The money came too late," said Diane Yentel, president and CEO of the National Low Income Housing Coalition, to Vox. “The money came after tenants had already amassed rent arrears of nearly $ 50 billion. So now we're playing catch-up. "

Estimates of the amount of rent back owed across the country range from $ 8.4 billion to $ 52.6 billion, meaning the $ 45 billion allocated should meet most of the need, especially given that renters indirectly received other forms of assistance from the federal government.

The vast majority of tenants have figured out how to make rental payments. According to the National Multi-Family Housing Council's rent tracker, "80.0 percent of apartment households have paid full or partial rent by May 6th." The previous month's data shows that by the end of the month, 95 percent of tenants had paid full or partial rent had partially paid rent.

Research by the Mortgage Bankers Association's Research Institute for Housing America found similar encouraging news: while 23.7 percent of tenants missed at least one payment in the past year, only 8.6 percent of tenants missed more than two payments.

But that doesn't mean that more than 90 percent of tenants are doing well. To make these payments, many renters have had to use up their savings, maximize their credit cards, or borrow from family members, friends, or payday lenders.

And it is not clear when the rental assistance will reach these people.

While the finance department doesn't require anyone to be late with their rent in order to qualify for assistance (per fact sheet), programs can add their own eligibility requirements. Some of these requirements could exclude renters like Matthew Turner, who went out of their way to stay in that group that missed only one or no payments.

Turner, a North Carolina renter, told Vox that his request for relief was originally accepted by a Wake County program but was eventually denied assistance after paying the rent.

"We sold all of our things in our apartment to pay the rent," Turner told Vox. Now, he says, he's trapped in an impossible place. If they fail to pay their rent, they run the risk of receiving an eviction notice – a black mark in a tenant's history that can make it harder to find accommodation in the future – but without providing evidence that he is in arrears with his rent, he cannot get any help to remain solvent.

"(My partner and I) discussed whether we should go independently or whether we should stay and be evicted and not be able to get another apartment for the next 10 years," he told me. The eviction moratorium has not stopped some landlords from filing evictions or, in some cases, even harassing tenants to leave. Turner doesn't want it to come to that, but if he doesn't get any help, he tells me they'll be homeless again.

Turner's story seems to suggest these programs are running out of funds, but all reports indicate that very little has actually ended up in the pockets of at-risk renters. The Treasury Department is collecting data on how much states have allocated to whom, but it has yet to be released. Tenant attorneys I spoke to in California and Washington, DC, told me they didn't know anyone personally who actually received help.

“I literally donated eggs (make rent). I sell body parts. "

The Georgian Ministry of Community Affairs announced that they have distributed more than $ 4 million in rental support funds to landlords and tenants. To this end, the state has received over $ 552 million. The State Housing Authority of Delaware announced that they had distributed $ 40,000 in rental support – 0.02 percent of their allocated funds. The Idaho Housing and Finance Association announced that they had distributed $ 6.1 million of the $ 175 million it received from the rental relief allocation in Congress in December. The Colorado dashboard shows that $ 2.8 million has been approved out of the $ 247 million it received. The Arizona dashboard shows that $ 4.38 million of the $ 289 million was disbursed.

More has achieved tenants – those state numbers don't include spending on county and city-level programs – but it did points out that the pace of these programs may not be fast enough to deal with the urgent crisis to come.

The New York Times recently reported that California paid out just $ 1 million of its $ 355 million in split funds, and Texas, which received over $ 1 billion, only paid 250 households after 45 days. Some states, including South Carolina and New York, don't even accept requests for emergency rental assistance.

“Of the open programs, they total about $ 18 billion of the $ 25 billion allocation. That's the amount of money available for open programs that take applications, review applications, and write checks, ”said Yentel.

County and city-level programs have been run in these states, which doesn't mean that all residents are completely without options, but it does underscore just how dire the situation is just six weeks after the moratorium ended.

Everyone agrees that this is an emergency. So what's taking so long to get the money out?

Time, knowledge and bureaucracy: these are the challenges that rent relief programs face in order to spend money.

States and municipalities have never had to set up rent relief programs to distribute federal aid. To do this, there must be programs for hiring staff, setting up websites, complying with additional regulations or goals set by state lawmakers, and conducting contacts. Despite their best efforts, most of the experts Vox spoke to were skeptical that it would have been possible for programs to move forward fast enough to get all of the help out the door before the end of June.

But this also reflects the government's lack of commitment to some of the most marginalized members in their communities.

"One of the things that this pandemic has made very clear is that there is a lot we don't know about our housing market," said Vincent Reina, director of the housing initiative at the University of Pennsylvania. "The vast majority of cities do not have complete registers of all the owners in their city. … It shows that we often do not know who owns properties and what is going on with those properties, or which tenants are in financial trouble."

If states had gathered detailed information on where tenants are in trouble and how much return rent has been amassed, this process would likely have been faster.

Candida Uraga, a tenant in New York City, says she used up her savings to keep up with rent after being fired from her teaching assistant job.

Robert Bumsted / AP

Protesters in California are calling on lawmaker and Governor Gavin Newsom to pass lease forgiveness and stronger evacuation protection on January 25th.

Rich Pedroncelli / AP

But there are some success stories. For example, a representative from Alaska Housing Finance Corporation told me that by May 10, the state had paid out $ 18.2 million and approved 9,000 applications. When I returned nine days later, the representative told me that he had approved more than 1,300 additional requests and sent payments totaling $ 25.9 million. The total allocation from the state is $ 200 million. So they still have a long way to go, but they owe their progress to the fact that they "offered a unified application optimized for mobile devices" and measured how long it took to process applications and "applicants, To make it as easy as possible for landlords or utility companies to submit the required documents.

"It seems clear that the places that are genuinely committed to analyzing how things are going and making course corrections have been best able to get dollars out the door," Reina said.

The second hurdle is knowledge. As Ashbes told me, she was unaware of the rent relief that was available to people like her despite trying to get government help (successfully filing unemployment claims) over the past year.

When I told her about the possibility of applying for rent relief, she sounded hopeless but said she would look into an application.

"I feel like I'm supposed to do something, but I have no idea what it is," she said. "It's kind of my fault, but I don't know what to do. I'm ready for anything, I do everything I can. It's breaking my body, it's breaking my soul. I've been thinking about going again dance like undressing, but I'm afraid my drug problem will return. "

Ashbes isn't the only one who doesn't know that billions have been set aside for rent relief. Shakeara Mingo, organizer at ONE DC and a member of the Cancel Rent coalition, told me that there are renters who don't know how to apply.

However, she is even more concerned about how difficult it is to apply even if tenants are made aware of it. Because programs can be audited to ensure they are spending the money the way the federal government intended, administrators are pressured to gather lots of information, invest resources and time into verifying that people are actually in Need before they give them money.

"One of the things that this pandemic has made very clear is that there is a lot we don't know about our real estate market."

This problem has two parts. One is unnecessary bureaucratic hurdles, like the one originally in Massachusetts, requiring applicants to present their physical birth certificates, and the other is necessary bureaucratic hurdles – there needs to be a way for programs to determine who needs how much help.

The interplay between getting money out of it quickly and making sure no one is playing the system (or more generously, getting the money to the people who need it most) isn't new. It is also not easy to blame individual programs or the federal government – it is inherently difficult to help needy residents. It is difficult, however, not to compare it to the ease of depositing stimulus payments into the accounts of tens of millions of Americans where residents did not have to provide proof to access funds quickly. People are quick to point out that most states have never had rental relief programs, but that begs the question – why not?

Finance released clarifications on May 7th to make the process less of a hassle and to clarify what types of documentation are needed. However, in Florida, where Ashbes lives, the following documents are required for all members of an applicant household:

ID (driver's license, birth certificate or passport)
Current rental agreement or other proof of rental agreement
Documentation of the annual income or the monthly income
Proof of approval documents for SNAP, TANF, Medicaid, Subsidized Housing, or Low Income Housing if you qualify
Documentation of unemployment benefit or proof of reduction in household income or proof of increased costs due to Covid-19
Notice of overdue rent, termination or eviction of lease, or conviction order, or failed inspection report from the local government

Having these documents on hand is not an easy task, especially for people like Ashbes who had to move in the last year or others who may not have formal documentation of their work or rental agreement.

"It's a really complicated process," said Shanti Singh, communications and legislative director for Tenants Together, California. "People who are hardest hit by economic difficulties during Covid-19 often do not have comprehensive documentation of difficulties or job losses."

Proof that people either don't know anything or are discouraged due to an annoying application process is shown in the application numbers. As of May 12, only 5,000 people in Georgia had applications for the state program and Delaware received 5,145 applications; until May 23rd Arizona had received 2,889 applications. and Colorado had received 8,510.

"All of these reporting requirements are designed to ensure that no one is playing the system," said Singh. "But the more demands you place on these programs, the more people who are really in need will fall through the cracks." . ”

Mike Flood, Senior Vice President, Mortgage Bankers Association, strongly agreed with the need to reduce documentation requirements: "Let us understand that the most important thing is getting money into people's hands … every time if we limit the program, a borrower or, quite frankly, a tenant is reluctant to take advantage of the program. "

What if the money doesn't come out on time?

Some advocates urge that the eviction moratorium be extended until these programs can adequately assess who needs help and how to get it.

Even if the moratorium is extended again (and the numerous lawsuits against the decision fail), the underlying debt will continue to accumulate and landlords will eventually reach their limits.

According to the Ministry of Housing and Urban Development, “41 percent of all rental units are owned by individual investors” or “mom and pop landlords”. That means these landlords are unlikely to be able to survive months of non-payment and still keep up with their own expenses.

Benny is a California landlord who bought his first home last year before Covid-19 became widespread. To make his mortgage payments, he rented a guest room to a tenant. After the moratorium began, his tenant stopped paying.

"We needed an eviction moratorium," said Benny, whose last name is being withheld to protect his privacy. "I definitely don't think we should allow far-reaching evictions, but I also think the way small landlords have been treated is unacceptable. … Honestly, I'll be forced to sell my house as soon as mine Tenant moves out. I will never be a landlord again after this situation. "

On March 1, the day New York's Covid-19 moratorium on rents expired, tenant rights activists held a demonstration outside the courthouse, which reopened eviction proceedings.

Andrew Lichtenstein / Corbis / Getty Images

Benny says he and his tenant have applied for rent relief, but he's skeptical that this will help. He is also frustrated that landlords, in order to accept rent relief, are demanding that landlords waive 20 percent of the rent back claim: "For me this is a kind of punishment for no real justification other than just the landlords as some consider some kind of evil being. "

It's not just bad because these small landlords are struggling. It's bad because small landlords offer disproportionately affordable housing.

Research by the Urban Institute shows that the average rent in small rental properties is below the median for single-family homes, medium-sized residential buildings and large residential buildings. And in 2018, the median income for a landlord with two to four units was $ 67,000. The tenants of these units are predominantly Black and Hispanic and have the lowest median household incomes when compared to tenants of other types of property.

Failure to provide adequate relief for landlords could put pressure on America's already limited affordable housing stock, which is nearing exhaustion after the Great Recession.

"It's important that we get the dollars out as soon as possible to stabilize (landlord)," warned Bob Pinnegar, president and CEO of the National Apartment Association. “We had a housing affordability crisis in Covid-19. If we come out with significantly fewer rental units, we will have a situation that will be far worse than before. "

Most likely, however, the eviction moratorium will soon come to an end – increasingly accessible vaccinations have made the justification for the order (that evictions and overcrowding of households would lead to the spread of Covid-19) less compelling.

Jamie Woodwell, vice president of research and economics for the Mortgage Bankers Association, argues that even if there is an increase in evictions, it needs to be contextualized in the context of the remarkable decrease in evictions over the past year: “It will really be important know how to do this, against which we compare the new evacuation stages. "

While the federal government's policies are unprecedented, it is a notable indication of the government's ability to act to leave millions of people vulnerable to evictions even though the money for their housing has already been allocated.

Correction, May 24th: The Idaho Housing and Finance Association distributed $ 6.1 million of the $ 175 million it received from the December rent relief allocation in Congress. The state also provided $ 15 million in CARES Act funding for rental and utility services.

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