$32 Million in Rent Assistance Issued in August, But Most Funding Still Unspent in Md.

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State and local governments in Maryland distributed $32.3 million in federal emergency rental assistance (ERA1) funding in August, according to newly released data from the state’s Department of Housing and Community Development, up from $29 million in July.

That means state and local governments distributed a total of $92.1 million in ERA1 funding by the end of August, with another $38.7 million payments in progress at the end of the month. September data is not yet available.

State and local governments in Maryland received a total of $401 million in ERA1 funding as part of the Consolidated Appropriations Act passed by Congress late last year and, including services and administrative costs, have used about $135 million of that funding so far.

At the end of August, the state had spent less than half of its total ERA1 allocation.

There was some concern that Maryland could lose its ERA1 funding at the end of September, because U.S. Treasury officials had planned to recapture unused funds and send them to jurisdictions that had already distributed 65% of their funding.

But Sara Luell, director of public information for the Maryland Department of Housing and Community Development, said in an email that the Treasury’s plan for reallocation has changed, and that officials will now “base reallocation decisions on funds expended for financial assistance, and work collaboratively with States to understand their program models, in addition to spend rates.”

According to a Sept. 24 letter from Deputy Treasury Secretary Adewale Adeyemo, Treasury officials will soon come up with a “clear minimum expenditure ratio” for reallocation based on how much ERA1 funding state and local governments distributed by Sept. 30, and will gradually reallocate funds over a period of months. Treasury officials will decide on the first expenditure ratio after grantees report September spending data on Oct. 15, according to Adeyemo’s letter.

“If funds are reallocated, they are expected to be reallocated within the state, not lowering the overall funds available to a state as a whole,” Luell said in an email.

The Treasury found that disbursement of rent aid increased nationwide in August compared with July. Treasury officials have tried to speed delivery of rent relief in recent months by allowing governments more flexibility over the funding, such as allowing self-certification from applicants who can’t provide documentation about their income and other eligibility requirements.

The updated Treasury guidance means state and local governments in Maryland will be able to work with federal officials before reallocations take place, Luell said, and will be able to share future spending projections and justify future funding rather than have their funding reallocated. And she said that once an ERA1 grantee (generally state or local government) has obligated 65% of the funds, they become eligible for additional ERA1 funds.

Luell said the state estimates more than $50 million in rent relief funding was distributed in September. Also the ERA1 funding isn’t the only relief distributed by state and local governments. Prior to ERA1, state and local governments in Maryland distributed more than $113 million in state, local and federal rent relief in 2020.

Fair housing advocates and state officials have urged local governments to quicken rent relief disbursement in recent months, particularly after federal eviction protections were struck down and similar state protections were allowed to expire.

According to the National Equity Atlas, there are 131,000 households behind on rent in Maryland with an estimated $429 million in total rent debt. Roughly 80% of tenants behind on rent in Maryland are people of color, according to data in the Atlas, which is taken from the U.S. Census and Treasury sources.

Fair housing advocates have said throughout the pandemic that rent relief funding alone won’t be enough to keep tenants in their homes, and many are urging state officials to reinstate protections. CASA, the largest immigrant advocacy organization in the Mid-Atlantic region, is holding a rally and “sleepout” in Annapolis Friday night calling on Gov. Lawrence J. Hogan Jr. (R) to reinstate eviction protections.

“This is absolutely nowhere close to being over,” Cathryn Paul, government relations and public policy manager at CASA, said in an interview earlier this week. “Black and Brown communities, especially, are suffering and are preparing for homelessness right now as we move into this next month. Now is not the time for us to be shy about protecting people.”

Advocates also want to see the General Assembly move forward with housing reforms that failed to pass during the 2021 legislative session, including a measure that would extend protections for tenants after future catastrophic health emergencies.

To learn more about how to apply for rental assistance in your jurisdiction, click here. To find out more about eligibility requirements for ERA1, click here

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