State warned after missing distribution goal for eviction relief

Maryland missed a federal bench mark for distributing millions of dollars in emergency assistance to help tenants pay their rent, the Treasury Department told a U.S. senator, drawing a warning from the agency.

The department said in an Oct. 26 email to Sen. Chris Van Hollen that Maryland is among the states that could lose some of the funding because it failed to spend 30% of the money by Sept. 30.

“As you know, Maryland is one of the states that may be subject to reallocation because it is below the 30% expenditure ratio,” said the email, which was obtained by The Baltimore Sun.

Van Hollen and fellow Democratic Maryland senator Ben Cardin sent a letter on Friday to Kenneth Holt, secretary of the state Department of Housing & Community Development, urging the agency to speed up the disbursement of the money, which is intended to help renters avoid eviction during the pandemic.

The state needs to act quickly “to avoid having these funds revoked by the Treasury Department beginning on November 15th, leaving tens of thousands of vulnerable Marylanders needlessly at risk of losing their homes,” the letter said.

Many other states or territories have also not moved as quickly as Treasury had hoped. According to Treasury data, about three-fifths of the states joined Maryland in not meeting the initial timeline.

The Treasury Department has told states that they needed to have spent 30% — Maryland’s figure was between 25% and 30% — or have allocated at least 65% of the funds by the end of September. It said it would begin reallocating states’ unspent money in mid-November unless remedial action was taken.

Mike Ricci, a spokesman for Republican Gov. Larry Hogan, told The Sun: “The state is not at any risk of reallocation of funds, and it is false to claim otherwise.”

He accused Van Hollen of not doing his “homework.”

The Treasury Department recently told states there are a few ways for states to avoid or mitigate losing funds, including submitting “program improvement” plans detailing their approaches. A Treasury spokesperson declined to respond Friday to questions from The Sun specifically about Maryland’s situation.

Ricci cited forecasts from the Department of Housing & Community Development to demonstrate the state’s progress.

“Based on the department’s projections, the October report will reflect that the state has more than exceeded Treasury’s targets,” Ricci said. “We have said all along that we are well on track to exceed those targets.”

Maryland launched its Emergency Rental Assistance Program in May 2020 with the help of $401 million in federal money approved for pandemic relief. About $143 million of that pot was divided among the state’s eight largest jurisdictions, including Baltimore City, while the remaining money was allocated to the Department of Housing & Community Development for statewide distribution.

The money was intended to help state residents at risk of losing their homes. State eviction protections expired on Aug. 15 and a federal eviction moratorium expired at the end of that same month.

In their letter, Van Hollen and Cardin noted that several surrounding jurisdictions, including Virginia, Pennsylvania and Washington, D.C., have spent larger portions of their funding than Maryland, “as have all local government grantees.”

The senators cited Anne Arundel County (74%), Baltimore City (85%), Frederick County (71%), and Prince George’s County (88%).

In August, Ricci chided local government officials, particularly Baltimore City, for their slow pace in distributing money.