April 7, 2020

Millions Still At Risk of Eviction Despite Moratoria

rental housing

A few months ago, few would have thought that housing would be one of our greatest assets in the fight against a global pandemic. But as it turns out, the very housing that we’ve been arguing over for years – how to fund it, that there isn’t enough of it, whose fault it is that it’s expensive, and why some people can’t access it – might now actually save lives in the age of coronavirus. If, and only if, we get it right. 

As we shelter-in-place, we’ve come to acknowledge that self-isolation requires that you have a place to shelter, but half a million Americans don’t, and millions more will join the ranks of the homeless if we don’t take immediate and decisive action. 

There are 43.8 million renter households in the country, and nearly 50 percent of them entered this crisis already unable to afford their rent. Add to that pressure record-high unemployment claims and a looming recession, and – seemingly overnight – millions of Americans are at risk of eviction. 

Some states and cities have stepped in to mitigate that risk by imposing eviction moratoria, which provide different levels and lengths of protection for renters. While these moratoria are a helpful first step, it is important to acknowledge that they are emergency measures, not solutions. For one thing, a moratorium doesn’t prevent eviction, it only delays it. Without sufficient assistance for renters to cover their lost wages, tenants will not be able to bounce back from the financial impacts of the coronavirus. Moreover, by requiring that renters demonstrate their hardship is “coronavirus-related,” these protections may ultimately fail to address the broader economic fallout of this pandemic.

At the same time, some landlords will face-short term challenges to fill the gap left by unpaid rents to cover required taxes, insurance, utilities, maintenance and mortgage payments. Although forbearance can provide some short-term relief to those who qualify, these landlords will eventually be responsible for paying missed mortgage payments retroactively. 

The federal government took some steps to provide eviction delays for some households in its third virus-related stimulus bill, known as the Coronavirus Aid, Relief and Economic Security (CARES) Act. As with state and local relief efforts, however, the provisions in this act aid only cover a narrow subset of renters.  

Who’s Protected?

The CARES Act provides eviction protections to renters in “federally-assisted” housing. Those provisions only cover a limited number of households – those that either receive direct subsidies or pay reduced rents as part of a federal assistance program, or who rent from private landlords that have federally-backed mortgages on their property. How many renters is that? No one knows, in part because the policy includes no fewer than seven entities that all report different information about the renters and landlords they cover, and not all include counts of those potentially served under other programs, so there is no way to determine how much overlap exists between them.

Even if we could estimate the total number of renters covered by these federal protections, those protections still would not benefit those who do not know they are covered by virtue of their landlord’s mortgage status. The average tenant does not have access to this information, unless their landlord reveals it, which under the current policy is neither required nor encouraged. Only those with federal rental assistance – who report their income to a housing authority to receive a subsidy or reduced rent – will know for sure they are eligible for eviction relief. That covers around 6.3 million households, or less than 15 percent of all renters nationwide. 

But even a nationwide eviction moratorium wouldn’t solve the challenge. After all, moratoriums come to end, and then what? Without direct and immediate rental assistance, millions of renters could still be evicted – just in the summer instead of spring. 

What We Can Do?

For those who have experienced job loss, the CARES Act provides $600 per week in unemployment compensation in addition to the respective state unemployment benefits. That additional boost may provide renters with the income necessary to pay their rent while meeting other household needs. However, because state unemployment agencies have been inundated with applications, it will take time to get cash flowing to renters and up the housing finance ladder. Funds must begin to flow now, to act as a bridge until federal assistance arrives. That is where state and local government – and even philanthropy – can play a crucial role.

Governors and mayors who have been on the front-line response to this crisis must create or expand emergency rental assistance programs. Even a modest appropriation of funds can act as a short-term bridge until federal help arrives. We can look to leaders in places like Arizona, Colorado, Santa Clara and Columbus for examples of how swift and responsive leadership can rapidly deploy rental assistance. Those programs can provide rent payments directly to landlords who then credit their tenants for paid rent. 

As we know, however, governors and mayors can’t go it alone. With stark predictions of declining tax revenues and requirements for balanced budgets, these localities are constitutionally and statutorily limited in the funds they can raise. Only the federal government has the resources to address the need. 

While we applaud Congress and the Administration for their efforts in significantly funding various housing and homelessness programs in the CARES Act, there was a notable omission from the CARES Act: the HOME Investment Partnership Program. Although it has been long regarded as one of the most powerful, flexible and desperately underfunded resources for addressing housing affordability, HOME was not included in the third stimulus package. There are few federal programs that can provide direct rental assistance to landlords on behalf of tenants, and HOME is arguably the most effective way to get federal relief where it’s needed.

Congress must act now and provide $48 billion for the HOME program in the next stimulus package. Congress should provide HUD with flexible authority to waive statutory provisions as needed to use the funds for immediate assistance for rental assistance and increased cost of operations and maintenance related to the pandemic.
 

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