At NAHB's Urging, Treasury Dept. Releases $21.6 Billion in Emergency Rental Assistance
Earlier this week, NAHB Senior Officers met with HUD Secretary Marcia Fudge to urge the expedited release of billions of dollars of emergency rental assistance and the same request was made to the White House two weeks ago. Today, the Treasury Department announced it is releasing $21.6 billion funding for the second tranche of the Emergency Rental Assistance Program (ERAP). Treasury released its first $25 billion in rental assistance earlier this year.
"NAHB commends the Treasury for moving quickly to dispatch this much-needed emergency rental assistance and for its commitment to provide an online hub of links to local emergency rental assistance programs," said NAHB Chairman Chuck Fowke. "This will make it easier for renters and landlords to find ERAP resources and programs in their area. We also applaud Treasury's responsiveness to NAHB's concerns to simplify the process to verify the income eligibility of renters, and to prohibit programs from denying assistance to eligible residents solely because they live in federally assisted housing."
Of note to the housing industry, Treasury also released a fact sheet which cites several steps the Biden administration is taking to disburse the rental assistance. Some of the major changes in the Treasury guidance are of serious concern to NAHB. These include:
- New Protections for Renters from Eviction While Payments Are Being Made on Their Behalf. Starting with today's guidance, programs must prohibit the eviction of renters for nonpayment in months for which they receive emergency rental assistance. While most landlords are working to secure relief and help renters stay in place, Treasury strongly encourages grantees to require that landlords not evict tenants for nonpayment of rent for 30 to 90 days longer than the period covered by the emergency rental assistance as a condition of receiving payment. Including additional restrictions on eviction as a condition of ERAP assistance has been a disincentive for landlord participation, especially among small business mom and pop landlords.
- Allowing – For the First Time – Offers of Assistance Directly to Renters First. While rental assistance programs under the initial Emergency Rental Assistance Plan – ERA1 – required an offer of assistance to landlords before reaching out to renters, the administration has made clear that the new funds from the American Rescue Plan (ERA2) can be used to provide assistance to renters first and immediately. NAHB strongly supports ERAP assistance for tenants, but we believe it is more efficient and less duplicative for the programs to reach out to landlords first.
- Require – for the First Time – Programs to Offer Assistance Directly to Renters if Landlords Choose not to Participate. Treasury says this will speed up payments to Americans who are most in need. Many landlords are working with tenants in good faith to secure aid and pay off rental debts.
- Cut in Half the Wait for Assistance Offered to Renters When Landlords Do Not Participate. Currently, where assistance is first offered to landlords, programs must wait 14 days when reaching out by mail or 10 days when reaching out by phone, text, or email before offering relief to a tenant directly. Those wait times will now be cut in half, to seven days and five days, respectively.
- Encourage Financial Assistance to Support Renters Finding New Housing. The Treasury guidance reinforces that expenses pertaining to moving expenses, security deposits, future rent, utilities, and the cost of a transitional stay in a hotel or motel when a family has been displaced should be considered eligible – and encouraged – uses of emergency rental assistance.