More than $46 billion to help multifamily property owners and residents with delinquent rent payments has been approved by Congress in recent months but that money is just beginning to flow from some states and jurisdictions while others have been delayed in setting up their programs, according to several industry executives.
“There are several states that have been up and running. There are other states that have been slow,” said Cindy Chetti, senior vice president for government affairs at the National Multifamily Housing Council.
The Emergency Rental Assistance Program (ERAP) is being run through the U.S. Treasury Department, which on Jan. 5 announced it had launched the $25 billion ERAP established by the Consolidated Appropriations Act, 2021, the $900 billion pandemic relief bill passed in December. The funds will assist households unable to pay rent and utilities due to the COVID-19 pandemic and are provided directly to states, the District of Columbia, U.S. territories, local governments with more than 200,000 residents and Indian tribes.
The $1.9 trillion American Rescue Plan Act signed into law last week by President Joe Biden adds another $21.5 billion for ERAP along with $5 billion for housing vouchers that can be used for rental assistance. Jurisdictions are being directed to prioritize households earning 50 percent of area median income (AMI) and below at the time of application but can include households with incomes up to 80 percent AMI who have been directly impacted by the pandemic.
Chetti said NMHC had worked hard to stress that the ERAP be “flexible and easy to implement.” She said they had suggested Treasury establish a portal to provide information about local administration for additional guidance but that has not yet been set up. However, Treasury did update its Frequently Asked Questions document on Tuesday. That document along with a state-by-state map offering the latest updates on emergency rental assistance programs around the U.S. is available on the National Council of State Housing Agencies website.
More guidance is expected soon from the Treasury Department to “lay out additional clarity for localities,” Chetti said. Each state and jurisdiction can set up their programs differently and Chetti said that can create confusion for owners who have properties in multiple states or jurisdictions.
“Some states are farther ahead. Some have really great websites,” Chetti told Multi-Housing News.
Several large states, including New York and Florida, have no information posted on the NCSHA site’s map. Oregon notes on its housing assistance website that the federal ERAP is not open yet for the state.
On Monday, Connecticut and Michigan released information about their states’ rental assistance programs. The Michigan State Housing Development Authority unveiled a new $282 million program to help tenants avoid eviction while also ensuring landlords could recoup back rent. MSHDA noted another $340 million is available to be appropriated by the state legislature, bringing the program to $622 million, of which $560 million will be used directly on rental and utility assistance. The housing authority expects to help between 50,000 and 55,000 families, or 140,000 individuals, through its COVID Emergency Rental Assistance (CERA) program. Connecticut said it had received $235 million from the December stimulus package to fund its UniteCT rental and utility assistance program. UniteCT can provide up to $10,000 in rental assistance and up to $1,500 in electric utility payments.
Scott Collier, managing director of asset management at TruAmerica Multifamily, which owns about 180 properties totaling about 45,000 units throughout the United States, said the California portal went live Monday. He said it has been changed from an earlier program that allowed only the residents to seek the rental assistance.
“The landlord can now submit on behalf of all of the residents that are behind on rent. That starts the process then the process is finished by whoever is administering the program who will be reaching out to the residents and completing the application. So I think it’s going to be a much smoother rollout,” Collier told MHN.
He said TruAmerica had already started the landlord applications.
“We think it’s more efficient and also we really do want to help our renters get current,” Collier said. “We sent out notices letting everyone know that help was on the way. We’ve received very positive responses.”
Bob Nicolls, owner of Monarch Investment & Management Group which manages about 64,000 multifamily units across 21 states, said ERAP money from the states “has just started to trickle out.” However, he noted some states like Illinois and Minnesota have not sent out any federal emergency rental assistance funding.
Nicolls said that is “a little upsetting because those two states have additional statewide eviction moratoriums and they’re the ones that should be getting it out immediately.”
When the pandemic began in March 2020, Nicolls said Monarch and its private investors created their own fund, Home Together, to help tenants who may have been having trouble getting unemployment and other assistance. By May 1, the investors had provided $400,000 and Monarch added $200,000 for a total of $600,000.
“When people needed help and they weren’t getting it from any other methods, they could apply through our property managers and the fund we created,” Nicolls said. As of late February, he said there was about $50,000 left in the fund.
Last month, Yardi Systems launched RentRelief, an online platform that streamlines the process of receiving financial aid for residents and landlords, as well as giving agencies and states the visibility they need for fast and accurate approvals.
Collier said TruAmerica didn’t have an in-house fund but did connect renters in need with various programs and also worked out payment plans.
“From the very beginning, we made every conscious decision to conduct ourselves with sensitivity and be aware of the situations that our renters are in and we’ve tried to help them whenever we can,” Collier said.
He noted that only about three percent to five percent of its tenants had struggled with rent payments.
“We’re reading reports that nationwide the average delinquent renter is around four months behind in their rent. To say the least, that’s a very daunting number. We don’t think that it would be easy to recover from that so this program, this direct assistance, is allowing renters to get a fresh start,” Collier said.