COLUMBIA, S.C. (AP) — Six months after Congress approved spending tens of billions of dollars to bail out renters facing eviction, South Carolina was just reaching its first tenants. All nine of them.
Like most states, it had plenty of money to distribute — $272 million. But it had handed out just over $36,000 by June. The pace has since intensified, but South Carolina still has only distributed $15.5 million in rent and utility payments as of Aug. 20, or about 6% of its funds.
“People are strangling on the red tape,” said Sandy Gillis, executive director of the Hilton Head Deep Well Project, which stopped referring tenants to the program and started paying overdue rent through its own private funds instead.
The struggles in South Carolina are emblematic of a program launched at the beginning of the year with the promise of solving the pandemic eviction crisis, only to fall victim in many states to bureaucratic hurdles, political inertia and unclear guidance at the federal level.
The concerns about the slow pace intensified Thursday, after the Supreme Court blocked the Biden administration from enforcing a temporary ban that was put in place because of the coronavirus pandemic. Some 3.5 million people in the U.S. as of Aug. 16 said they face eviction in the next two months, according to the U.S. Census Bureau’s Household Pulse Survey.
“The Supreme Court decision undermines historic efforts by Congress and the White House to ensure housing stability during the pandemic,” Diane Yentel, CEO of the National Low Income Housing Coalition, said in a statement.
“State and local governments are working to improve programs to distribute emergency rental assistance to those in need, but they need more time; the Supreme Court’s decision will lead to many renters, predominantly people of color, losing their homes before the assistance can reach them.”
The Treasury Department said this week that just over $5.1 billion of the estimated $46.5 billion in federal rental assistance — only 11% — has been distributed by states and localities through July. This includes some $3 billion handed out by the end of June and another $1.5 billion by May 31.
Nearly a million households have been served and 70 places have gotten at least half their money out, including several states, among them Virginia and Texas, according to Treasury. New York, which hadn’t distributed anything through May, has now distributed more than $156 million.
But there are 16 states, according to the latest data, that had distributed less than 5% and nine that spent less than 3%. Most, according to the National Low Income Housing Coalition, are red states, often with tough-to-reach rural populations. Besides South Carolina, they include Alabama, Arizona, Arkansas, Iowa, Indiana, Florida, Nebraska, North and South Dakota, Mississippi and New Mexico.
There are myriad reasons for the slow distribution, according to the group. Among them is the historic amount of money — more than the Department of Housing and Urban Development’s annual budget — which required some 450 localities to create programs from scratch. Getting the money out is also complicated by the fact that checks aren’t sent directly to beneficiaries like, for example, the child tax credit.
States and localities have also struggled with technology and staffing, as well as reaching tenants without access to the internet, or small landlords unaware of the help. Some have applications so complicated they scare off prospective applicants or have income documentation and pandemic impact requirements that can be time-consuming.
Efforts to use coronavirus relief money for rental assistance last year faced similar challenges.
“A lot of states are lagging behind,” said Emma Foley, a research analyst with the National Low Income Housing Coalition. “The fact that this many states still have distributed so little is worrisome.”
In South Carolina, lawmakers were slow to roll out the state’s program, waiting until April to charge the state housing authority with distributing the money. It took weeks to set up its program, with the first help not going out until June.
Housing advocates have also criticized the reams of documentation required and the months of waiting for tenants to find out whether they qualify.
Shaquarryah Fraiser applied in May and is still waiting to hear whether she will get help paying months of back rent for the mobile home she rented with her mother for $550 a month in Sumter, South Carolina. Fraiser’s mother died of COVID-19 last year, and the 29-year-old fell behind after getting sick herself with pneumonia and losing her phone survey job.
“It’ll take a lot of stress off of me. I won’t be so anxious about this situation,” said Fraiser of the prospect of getting the help.
In Arizona, delays have led to plenty of finger-pointing.
Arizona’s House Democrats this month blamed the state for the delays in getting the money out — less than $7 million of its $900 million through July.
Arizona’s Department of Economic Security points out the federal money has been allocated to 13 different jurisdictions, not just the state, and blames cities and counties for the slow rollout.
“We have offered to assist overwhelmed jurisdictions with their workloads,” the department’s director Michael Wisehart wrote in a response to lawmakers. “Regrettably, no jurisdiction has chosen to partner in this way.”
Meanwhile, Arizona landlords and housing nonprofits blamed much of the problem on regulatory requirements tied to the money.
Mississippi, which has given out $18.6 million of its $200 million through Aug. 23, has struggled to reach smaller landlords and renters, many of whom live in rural areas without internet access. In addition, the state has no data base of renters — prompting it to hold events statewide to connect with potential applicants.
The Mississippi Home Corporation, which runs the program, also sent a letter to judges asking them not to allow an eviction if someone has applied for help and to inform landlords they won’t get help if they evict after the moratorium ends. The agency also relaxed documentation requirements in 50 of its counties. But the program will still require proof of income and other documents in 32 other counties.
“You’re trying to walk this line of speed and diligence,” said Scott Spivey, executive director of the Mississippi Home Corporation. “We are trying to make sure there is no fraud, waste and abuse and that we’re only giving assistance to the people who are entitled to it.”
The Treasury Department has repeatedly tweaked its guidance to encourage states and local governments to streamline the distribution of funds. The Biden administration has also asked states to create eviction diversion program s that aim to resolve disputes before they reach the courts.
On Wednesday, Treasury released additional guidance to try to speed up the process. This includes allowing tenants to self-assess their income and risk of becoming homeless among other criteria. Many states and localities, fearing fraud, have measures in place that can take weeks to verify an applicant qualifies for help.
Treasury also said money can be distributed in advance of funds being approved as well as to tenants who have outstanding rental debt in collection, making it easier for them to find new housing.
“There is no question we are seeing a level of excessive caution in getting the money out that does not seem to reflect either the flexibilities Treasury has provided or the fact we are facing a true public health and eviction emergency,” said Gene Sperling, who is charged with overseeing implementation of President Joe Biden’s $1.9 trillion coronavirus rescue package.
He said the new guidance is “going the extra mile to provide even more clarity and strong encouragement to put getting immediate relief out ahead of unnecessary and time-consuming paperwork.”
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