With the passage of the American Rescue Plan stimulus relief bill last March. Congress allocated a total of $46 billion in assistance for renters and their landlords. This money was meant to be distributed by each state to those most in need and at risk of being potentially evicted and help landlords stay afloat during the moratorium on evictions — but very little has actually been distributed.
Only $4.2 billion of the $46 billion has reached households, according to a new report by the National Low Income Housing Coalition.
Part of the problem is reluctant landlords. Building owners throughout the country are refusing offers of assistance, saying that the aid has too many strings attached, like preventing them from ousting difficult tenants or requiring them to turn over sensitive financial information to government agencies and contractors. The process also requires lengthy administrative works and documentation from landlords, which can be time-consuming and difficult to complete, which creates a barrier to entry for federal assistance.
States have increased spending from 4% to 10% between May 31 and June 30, the NLIHC states. Localities also increased spending from 13% to 20% over the same period they state, but despite these increases, many states and localities have spent little to none of their allocations. They share that of particular concern are large states with high numbers of low-income households. Florida, for example, paid out only 237 households and, in total, paid out only .2% of its allocation by the end of June. New York, another state with large numbers of low-income households and with one of the largest urban areas in the world, has surprisingly served no households and has expended none of its funding.
The NLIHC points out that staff capacity to screen and administer emergency rental assistance programs and the ability to scale technical capacity are significant challenges to getting the money out there. Programs are also overwhelmed by the volume of applications. The Urban Institute reports that a recent study found that less than half of renters and just 40 percent of landlords even know about the federal assistance available to them while some are still unsure whether they qualify to receive the funds.
More From GOBankingRates