NC may get $700M in rent aid under new federal stimulus. Where will the money go?
North Carolina could get nearly $700 million from the $25 billion in rental assistance included in the new COVID-19 relief bill that congressional leaders agreed on over the weekend.
The National Low Income Housing Coalition, a national nonprofit that advocates for more affordable housing, estimated how much money would go to each state and U.S. territory.
Part of the estimated $700 million would go to cities in the state with 200,000 or more people. The rest would go to the state government to disburse to more rural parts of North Carolina.
The stimulus bill would also extend the Centers for Disease Control and Prevention’s nationwide eviction moratorium until Jan. 31. The CDC order had been set to end Dec. 31.
“This is exactly what we need,” said Samuel Gunter, executive director of the N.C. Housing Coalition, in an interview. “When it comes to the crisis that we’re seeing on the housing front, and making sure folks have stable housing, I think this is unqualified good news.”
The rental assistance is part of a larger bill, The Consolidated Appropriations Act of 2021. That bill includes other COVID-19 relief worth $900 billion and funding for the federal government’s current fiscal year, which ends on Sept. 30 next year.
Ford Porter, deputy communications director for Gov. Roy Cooper’s administration, told The N&O in an email that the stimulus is an important first step and Cooper’s office will carefully look at it to determine how best to distribute the funds throughout the state.
The bill passed the U.S. House of Representatives and Senate on Monday, but on Tuesday, President Donald Trump called the bill a “disgrace” and demanded that stimulus checks be increased from the $600 per person in the bill to $2,000.
Trump also called some of spending in the budget attached to the stimulus wasteful and said that it should be reduced.
If Trump were to veto the bill, the House and Senate would be able to overturn it if the current vote on the legislation holds.
Democratic Speaker of House Nancy Pelosi said on Twitter that the party is prepared to bring the $2,000 stimulus to a vote on the House floor this week.
How the rental assistance works
If the bill is signed by Trump, 90% of the estimated $700 million allocated to North Carolina must be used for tenants’ past unpaid rent, future rent and utility payments.
The assistance can last for up to a year. States and municipalities can provide an additional three months if needed for a particular household to stay in their home.
Tenants can only apply for assistance in three-month increments, after which they must reapplyto determine if they remain eligible.
States and municipalities cannot commit to helping pay future rent assisting with a household’s future rent payments until past-due rent is addressed.
Payments can be made to the landlord or utility company if the state or municipality chooses to do so. If a landlord refuses the assistance, the money can be sent to the tenant to pay the landlord.
Households are eligible if one or more person in the household has qualified for unemployment benefits, has lost significant income has had increased costs or has experienced some other financial hardship during the pandemic.
The household must also be at or below 80% of the area median income. In 2019, Wake County’s area median income was $59,100 for an individual or $84,300 for a family of four, The N&O reported.
A household is not eligible if it already receives some other form of federal housing assistance.
In disbursing the funds, states and municipalities must prioritize households at 50% or below the median income and anyone that has been out of work for 90 or more days. Other priorities can be instituted at the discretion of states and municipalities.
Landlords can apply for the assistance on their tenant’s behalf, but the tenant must also sign the application and the funds must be used to pay the tenant’s rent.
Is this enough?
Dustin Engelken, government affairs director at the Triangle Apartment Association, is relieved that Congress included rental assistance in its agreement but concerned it won’t be enough.
“What comes next?” he said in an interview, “This is a good development. But I’m afraid we’re going to be right back asking for more pretty quickly because it’s not going to be enough to meet all the need.”
The national housing coalition estimates that Americans owe up to $70 billion in back rent alone, nearly three times the $25 billion in the new stimulus.
Engelken said the long term solution for both landlords and tenants must involve making people financially independent.
“You’ve got to find a way to beat the virus,” he said. “You got to help people make up lost income and keep up on their bills, but ultimately, the solution to this entire situation is getting people vaccinated, getting people back to work, hopefully putting a large amount of people in a position where they can pay their own rent moving forward.”
Gunter agreed.
“Folks got to get back to work, back to school,” he said. “Otherwise, we’re continuing down this path.”
Eviction moratorium extension
Engelken, whose group serves the apartment industry in the Raleigh-Durham-Chapel Hill area, said he was disappointed that the eviction moratorium was extended.
“The eviction moratorium, which we’ve said from the very beginning, is really a band aid and not an actual solution,” Engelken said.
The CDC moratorium, instituted in September, banned evictions for nonpayment of rent due to the pandemic but did not provide assistance to landlords.
“I hope there’s a clear understanding that if we’re doing it [an extension] now, it is so that we can launch these programs and that we can get assistance out and that it is itself not the solution to the problem,” Engelken said.
This story was originally published December 22, 2020 at 5:50 AM with the headline "NC may get $700M in rent aid under new federal stimulus. Where will the money go?."