States, cities running out of rental assistance monies from fed

Several large states and cities have exhausted their federal rental assistance, the Treasury Department said Monday, in a sign that spending on a massive pro- gram aimed at averting evic- tions has picked up speed.

The federal government is forecasting that upwards of $30 billion or about twothirds of money allocated for rental assistance will be disbursed or allocated by the end of the year. That is a dramatic change from this summer when housing advocates were complaining about the slow pace of distribution.

But with the improved outcome of the $46.5 billion program has come concerns that some tenants will not get help. The first tranche of emergency rental assistance funds, known as ERA1, is for $25 billion and the second, known as ERA2 and meant to be spent over a longer period of time, is $21.5 billion.

Texas has stopped accepting new applicants because it has allocated all its funds, while Oregon has stopped taking new applicants for now, the Treasury Department said. The state of New York has spent or committed nearly all of its money, as has Philadelphia. California has indicated it will soon exhaust its funds, while Atlanta has closed its program to new applicants.

More than 100 other state and local entities have indicated they have gone through almost all their ERA1 money and are beginning to spend down their ERA2 funds, Treasury said.

“There is a lot of work still to do to get funds out in a timely way to prevent avoidable evictions, but we are in a new phase.” Gene Sperling, who is charged with overseeing implementation of President Joe Biden’s $1.9 trillion coronavirus rescue package, said in an email interview.

“We now have the three largest states and many cities saying they have run through or will soon run through all of their ERA funds,” he continued. “Treasury is using the reallocation process to spur weak performers to up their game and to get more funds into the hands of those who can help the most vulnerable the fastest.”

Congress has authorized $46.5 billion in emergency rental assistance in a bid to thwart what was expected to be a wave of pandemic-related evictions.