Feds clawing back rent relief cash
The federal government is clawing back rent relief funds from city, county and state programs that have been slow to disburse the aid to renters.
Six of the 14 programs that have already been forced to return money are in Texas — a sign of how the main congressional measure passed to support renters and landlords affected financially by the pandemic has in many cases failed to connect billions of dollars in aid nationwide with those who need it.
“This is an all-hands-on-deck situation,” said Erin Hahn, a research analyst for nonprofit housing advocate Texas Housers. Since the statewide rent relief fund has closed, Texas renters and landlords affected financially by the pandemic are dependent on the aid being distributed by local programs.
So far the amounts being returned are fairly small — the cities and counties in Texas all forfeited less than $1 million. Hays County, which includes San Marcos, forfeited $773,000 (11 percent of its first round of Emergency Rental Assistance Program funds), and Laredo forfeited $587,000 (7 percent). But those amounts could increase in further rounds of clawbacks unless they step up their spending.
Jefferson County lost $315,000 (4 percent) and Brazoria County lost $121,000 (1 percent). Nueces County, which includes Corpus Christi, and El Paso County also lost portions of their funding. In
addition to the six Emergency Rental Assistance Programs in Texas that involuntarily relinquished funding, Montgomery County voluntarily returned $7.1 million, or roughly 40 percent, of its first round of Emergency Rental Assistance Program funds.
The U.S. Department of the Treasury has begun reallocating the program funds from local governments that have been slow to disburse rent relief to those that have distributed theirs more quickly. It announced the first round of reallocated funds
earlier this month.
The Treasury Department will continue reallocating funds in the coming months.
The current round of reallocations was based on whether local programs had spent at least 30 percent of their first round of funds by the end of September — if they had not, the difference between their spending and the 30 percent threshold would be considered excess funds.
The next round looked at whether local programs distributed at least 40 percent of their first round of funds by the end of
November. That data came out Jan. 7, showing that 14 rent relief programs across the state had failed to meet that threshold, including Montgomery, Brazoria and Jefferson counties.
The counties did not respond to a request for comment.
The Treasury Department expects that local programs will have distributed at least 50 percent of their first round of funds by the end of January and all of it by the end of March.