Administration Rolls Out New Rental Assistance Guidelines

On May 7, 2021, the Biden Administration announced the allocation of an additional $21.6 billion for emergency rental assistance that was passed earlier this year through the American Rescue Plan Act, which is referred to as Emergency Rental Assistance 2 (ERA 2) by the United States Department of Treasury (USDT). With the new monetary allocation, USDT released updated guidance which contains new program requirements for grantees who distribute rental assistance.

The new guidance removes a number of barriers that the rental housing industry has called out, such as prohibiting programs who receive ERA 2 from denying assistance to eligible residents solely because they reside in federally assisted housing. This ensures that the nation’s most vulnerable renters remained stably housed throughout the remainder of the pandemic. Additionally, the new guidance establishes an online hub of local emergency rental assistance program links to make it easier for renters and landlords to find programs in their area.

There are several problematic requirements that were included in the newly published guidance. The document allows ERA 2 programs to offer direct-to-resident assistance first and immediately – not requiring programs to go to housing providers beforehand. Additionally, the guidance continues to allow programs distributing ERA 2 to offer direct-to-resident assistance when a housing provider opts out of participating in an ERA program. However, if an ERA 2 grantee chooses to seek the cooperation of housing or utility providers before providing assistance directly to residents, Treasury strongly encourages the grantee to apply the same ERA 1 requirements. NAA encourages members and affiliates to reach out to their state or local program and encourage grantees to choose to continue to seek the cooperation of housing providers, to ensure direct payments to housing providers continue.

Another new requirement in the guidance is that programs must prohibit the eviction of renters for nonpayment in months for which they receive emergency rental assistance. Additionally, Treasury strongly encourages grantees to require that housing providers not evict residents 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. While some grantees have this in place, affiliates and members should expect more programs to enact these protections in the near future.

Other noteworthy changes in the guidance and White House fact sheet include:

• Changes the required response time  for housing providers electing to participate to 7 days when reaching out by mail and 5 days when reaching out by phone, text, or email. Previously, programs were required to 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.
• Widens the scope of qualified expenses to include “moving expense, security deposits, future rent, utilities and the cost of a transitional stay in a hotel or motel when a family has been displaced” and does not require the qualified expense be related to COVID-19 outbreak.
• Strongly encourages grantees to avoid establishing burdensome documentation requirements that are likely to be barriers to participation for eligible households, by allowing programs to verify eligibility of low-income renters based on readily available information or “proxies”, such as the average income in the neighborhood in which they live.
• Requires programs to prioritize assistance to low-income households and those with members who have been unemployed for more than 90 days. To help ensure that assistance is reaching those who most need it most – especially those with incomes below 50 percent of the area median income – grantees are now required to report how they will achieve the required prioritization of assistance.
• Encourages additional legal services and support to hard pressed residents. HUD is developing a $20 million demonstration to provide legal assistance to low-income residents at risk of or subject to evictions. More information on this new program can be found here.
• Advances the Nation's understanding of evictions in the marketplace. HUD will continue to build out a research agenda for helping the field better understand the prevalence of evictions and the disparate impact they have on disadvantaged communities. This includes assessing how the federal government could develop a national database of evictions.

NAA continues to communicate with USDT and Congress on changes and additional clarifications that should be made to ensure that the program continues to be executed in an efficient and timely manner. If you have any questions regarding the emergency rental assistance programs, please contact Jodie Applewhite at japplewhite@naahq.org.