California is clawing back some COVID-19 rent relief it gave to tenants and landlords
California is demanding that thousands of tenants and landlords who were approved for emergency rental assistance during the pandemic return the money — often months after it has been spent — sometimes for vague or unspecified reasons.
The California Department of Housing and Community Development has sent “recapture” emails to about 5,400 tenants and landlords who received COVID-19 rent relief funds, the agency told The Sacramento Bee.
HCD gives aid recipients 30 to 90 days to send the money back, said Nur Kausar, HCD communications manager. The agency claims overpayment, tenants withholding funds from landlords and fraudulent activity are among the reasons they ask people who’ve gotten relief money to return it, Kausar said.
But lawyers suing HCD on behalf of needy tenants call the repayment requests “retroactive denials” and say asking for the money back is “outrageous and unfair.”
“These are tenants who went through the complicated and lengthy application process, submitted all their documents, and were approved to get help,” said Madeline Howard, a senior attorney for the Western Center on Law and Poverty, in an email.
“Then HCD turns around with no warning and tells the tenant they are denied, without explaining why, and demands the tenant pay back money they do not have anymore because they have paid it over to their landlord. This is both unlawful and profoundly unfair.”
Renters ‘devastated’ by repayment requests
In a court declaration, the leader of a Northern California nonprofit said tenants who have received notices to repay their relief funds are “devastated by this experience.”
“All of our clients are low-income and lack the means to repay the rental assistance they previously received and paid to their landlord,” said Amber Twitchell, associate director of Napa County nonprofit On the Move.
One of the tenants who received a repayment notice is a single mother who lost her husband to COVID19 and had to find a new rental she could afford without his income, Twitchell said. She received $8,100 in rental assistance and “does not know how she will be able to come up with the money to repay the state.”
“Many of our clients are immigrants, including some who are undocumented,” Twitchell said. “This experience has damaged their trust in the community and in the government. This experience also has affected their trust in my organization and in my staff.”
Tenants sue state over rent relief program
California’s emergency rental assistance program has sent more than $4 billion to about 344,000 households since March 2021, according to HCD data.
Households received payments averaging $12,000 to help with months of back rent.
To get aid, tenants and landlords had to submit lengthy applications to HCD. Some waited months to receive their payments because of a processing backlog.
The program closed to new applications on March 31, although some cities and counties continue to run their own relief programs. California lawmakers continued eviction protections for tenants who applied, but the last extension ended June 30.
In June, tenant advocacy groups Alliance of Californians for Community Empowerment and Strategic Actions for a Just Economy joined with research institute PolicyLink to sue HCD in Alameda County Superior Court.
The groups claim the agency has denied eligible tenants’ aid applications with confusing explanations and provided few appeal opportunities.
On July 7, a judge granted their request to stop HCD from denying rental assistance to additional tenants until the court could determine whether the application process meets constitutional standards.
Tenants, landlords asked to return rent relief
The lawsuit also claims HCD is wrongfully issuing retroactive denials in asking poor tenants to return aid funds they’ve already used to pay their landlords.
The judge’s ruling also requires the agency to stop sending out those denials, as well, Howard said.
In her court declaration, Twitchell said her organization is helping 26 tenants and two landlords who received HCD repayment requests after the state distributed a total of $175,000 in aid funds.
Twitchell said tenants and landlords received HCD repayment notices via email weeks or months after their applications were approved and they had used the money to pay off their back rent.