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As eviction crisis loomed, rental relief barely picked up in July

Last month, nearly $1.7 billion was spent on rent, utilities and missed payments, slightly more than the $1.5 billion in June

Demonstrators hold signs during an “Eviction Moratorium Extension” rally in the Brooklyn, New York, on Aug. 19. (Paul Frangipane/Bloomberg News)

The amount of emergency rental aid reaching tenants and landlords barely picked up in July compared to June, reflecting ongoing struggles for the White House, along with state and local governments, to help people catch up on payments and avoid eviction.

Last month, nearly $1.7 billion was spent on rent, utilities and missed payments for vulnerable households, according to data released Wednesday by the Treasury Department. That’s only a slight uptick from the $1.5 billion that was disbursed in June, despite intense pressure on the Biden administration and local officials to ramp up spending before July 31, when the initial eviction moratorium from the Centers for Disease Control and Prevention expired.

The eviction moratorium has been extended for many renters, but not for all. Here’s what you need to know.

The amount of money that’s actually reached people in need is a fraction of the $46.5 billion appropriated by Congress for emergency aid. Of the $25 billion appropriated in December, state and local programs spent about $5.1 billion between January and the end of July, according to Treasury. A March relief package provided the other $21.5 billion. About $108 million of that bucket had been spent as of June.

On Wednesday, the Biden administration released guidelines it says will further streamline application processes and make it easier for people to get help. But it’s unclear whether the changes will be enough to solve the persistent issues that have snarled rental relief programs for months.

Meanwhile, the very fate of the CDC’s newer eviction moratorium, announced Aug. 3, hangs in the balance. The moratorium was intended to last until Oct. 3 and covers counties with “substantial and high levels of community transmission” of the coronavirus. Part of the goal was also to give states and cities more time to get rental relief payments out.

But that ban was abruptly challenged by landlords and real estate trade groups. Housing advocates and eviction experts say it’s possible the Supreme Court could strike down the moratorium any time.

Fearing end of eviction moratorium, tenants wait on billions in unspent rental aid

The latest Treasury data showed some signs of progress: Roughly 341,000 households were helped in July, compared to 293,000 in June. Over 60 percent of the households served earn no more than 30 percent of area median income.

Additionally, the state of New York hadn’t paid out any of its $800 million in first-round funds by the end of June, baffling administration officials and housing advocates. In July, the state paid out $2.7 million, according to Treasury.

“However, too many grantees have yet to demonstrate sufficient progress in getting assistance to struggling tenants and landlords,” Treasury wrote in a Wednesday post. “After September, programs that are unwilling or unable to deliver assistance quickly will be at risk of having their rental assistance funding reallocated to effective programs in other high-need areas.”

The federal eviction moratorium does not wipe away bills for people who’d fallen behind, which is why Congress set aside significant funding. But that money has been painfully slow to get off the ground, and required states and cities to prop up application systems in an emergency. Confusion reigned. Technical glitches dogged online systems. Landlords and tenants without Internet had even more trouble applying for aid — if they knew about the funding at all.

Last-minute eviction ban extension fuels confusion and is too late for some

The July rental relief figures were also a sobering reflection of how little money was spent in the intense run up to July 31. Earlier this summer, the Biden administration released waves of guidance around funding and implored courts, local governments, landlord groups and housing advocates to band together to slow-track eviction cases. Administration officials warned the moratorium would expire at the end of the month.

But as the delta variant of the coronavirus spread and money trickled out, pressure mounted on the White House to keep the moratorium in place. The Biden administration said it had no legal standing to do so. In June, Justice Brett M. Kavanaugh wrote that any further extensions beyond July would require “clear and specific congressional authorization” through new legislation.

Biden administration moves to block evictions in most of U.S. following liberal backlash

Days before the July moratorium lapsed, President Biden called on Congress to pass new legislation. But that move blindsided lawmakers who said they didn’t have time to usher in a new law. Congressional Democrats launched a last-minute effort to extend the ban. Rep. Cori Bush (D-Mo.), who previously experienced homelessness, slept outside the Capitol in protest.

Facing mounting pressure from liberal lawmakers, the Biden administration announced a separate, temporary ban on evictions that covered most of the country on Aug. 3. Yet the news came too late for some people who were already losing their homes. Biden himself warned that the new moratorium was likely to be challenged in court and might not survive to Oct. 3.

For now, administration officials say the additional guidelines should answer many of the questions that still come up from state and local governments and housing agencies, especially those wary of loosening application requirements.

For example, the guidance outlines all the ways households can rely on self-attestation, meaning documents could be verified by applicants themselves. Money can also be used to cover rent or utility bills at a previous address. The Departments of Agriculture, Health and Human Services, Housing and Urban Development, and Veterans Affairs are also taking steps to help renters.

It’s difficult to estimate how many people are at risk of eviction. Oftentimes, local courts dictate how quickly eviction cases can be processed, and how fast people could be removed from their homes. It is estimated around 6 million renters remain behind on payments, according to Moody’s Analytics.

Tara Raghuveer, founding director of KC Tenants, said renters in Kansas City, Mo. are still “completely confused about what protections are available to them, and what aren’t, and what assistance might be available to them, and what what’s not.” Raghuveer said the newer moratorium hasn’t kept landlords and courts from using technical loopholes to remove people from their homes.

“Rental debts continue to stack up, and people are being forced to the street,” Raghuveer said. “Extended-stay hotels in Kansas City are at capacity.”

As she was talking to a reporter, Raghuveer said another Facebook message popped up on the KC Tenants account: someone new was facing eviction and looking for help.

Jonathan O’Connell contributed to this report.