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Emergency rental assistance improved slightly in August but still lags far behind

The Treasury Department is starting to outline ways unused funds will be reallocated to high-performing programs

Rep. Alexandria Ocasio-Cortez (D-N.Y.), right, at an event on Capitol Hill advocating for the reimposition of a nationwide eviction moratorium on Sept. 21. (Jabin Botsford/The Washington Post)

The amount of emergency rental assistance reaching landlords and tenants ticked up slightly from July to August, but local and federal governments continue to struggle to get aid to households facing eviction during the coronavirus pandemic.

Last month, roughly $2.3 billion was spent on rent, utilities and missed payments, and some 420,000 households were reached, according to figures released Friday by the Treasury Department. For comparison, $1.7 billion was spent in July, reaching 340,000 households.

Still, only about $7.7 billion in rental aid has been distributed since January. All told, Congress appropriated $46.5 billion for emergency rental aid between two aid packages. Of the $25 billion appropriated in December, roughly $7.5 billion has gone out the door. A March relief package provided the other $21.5 billion. About $222 million of that bucket had been spent as of August, according to Treasury.

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

There are some signs of improvement. The state of New York had long baffled Biden administration officials and housing experts for spending none of its first-round funding — or $801 million — as of the end of June. Only $2.7 million was spent by the end of July. But in August, the state disbursed almost $298 million.

The city of Los Angeles also gained speed, spending $32.4 million in first-round funds in August, up from $21.4 million in July, according to Treasury data.

Evictions are about to restart as tenants wait on billions in unspent rental aid

But many programs still lag far behind, and administration officials, along with housing experts and advocates, are far from satisfied. Officials say they are still getting resistance from local program administrators who have not heeded the administration’s calls to loosen application requirements, fearing money will get into the wrong hands.

By law, the rental assistance program directs Treasury to start reallocating “excess” first-round funds at the end of September. On Friday, Deputy Treasury Secretary Wally Adeyemo sent a letter to all grantees about how that process will unfold, though more specific guidance is expected in coming days.

The letter says that Treasury will aim to keep funds within the same state, whenever possible. For example, Treasury could move funds from a low-performing local program to the state level, or vice versa.

Supreme Court strikes down CDC eviction moratorium despite delta’s rise

“We anticipate implementing the reallocation process over a period of time, with escalating consequences if a state or locality fails to demonstrate progress in using its [first-round] funds or implementing the flexibilities Treasury has made available,” Adeyemo wrote in the letter.

An eviction moratorium put in place by the Centers for Disease Control and Prevention last year was intended to keep people who’d fallen behind on their bills in their homes during a public health crisis and economic recession. But the federal protection didn’t wipe away missed payments. Federal funds were intended to fill that gap.

But the money has been slow to get out to people, 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.

The level of urgency intensified last month when the Supreme Court struck down a final eviction moratorium, which the Biden administration had hastily enacted days after the expiration of the previous moratorium — partly to give government officials more time to get out more federal aid for rental relief.

Census Pulse survey data suggests that roughly 3 million households expressed concern about imminent eviction, including some of the lowest-income earners. Of all households reporting that they are behind on rent, two-thirds of them earn less than $35,000 per year, Treasury noted in a Friday blog post.