WASHINGTON, D.C. — As our country continues to face the impacts of the latest wave of the COVID-19 pandemic, U.S. Senator Alex Padilla (D-Calif.) led a group of Senators in calling on the Treasury Department to reallocate federal rent relief funding to communities most in need. In a letter to Treasury Secretary Janet Yellen, the Senators requested new guidelines for the distribution of reallocated Emergency Rental Assistance (ERA) Program funds as quickly as possible. The Senators asked that the Secretary reallocate funding to communities with the greatest need by prioritizing very low-income renter households paying more than 50 percent of income on rent and renters with a change in employment since the beginning of the pandemic, among other things.

“We write to ask that unused emergency funding that is eligible for reallocation be deployed in an accelerated manner to keep families stabilized as we continue to address the current COVID-19 surge,” wrote the Senators. “Amid the current surge of COVID-19, our states continue to deploy these resources as quickly as possible. However, it is clear that a significant amount of ERA2 funds remains unused across the country, while some grantees, including our states and communities, face demand for rental assistance that exceeds available resources.”

In California, more than 84 percent of rent relief went to the state’s poorest residents made up of households earning less than half the median income in their areas.  ERA has greatly helped renters in need – research suggests that aid to tenants, in combination with eviction moratoria, prevented at least 1.55 million eviction filings across the country over the course of a year, and kept evictions well below normal levels in 2021.

ERA1 provided states, U.S. territories, local governments, and Indian tribes up to $25 billion under the 2021 Consolidated Appropriations Act, which was enacted on December 27, 2020, while ERA2 provided up to $21.55 billion under the American Rescue Plan Act of 2021, which was enacted on March 11, 2021. The Senators are asking that the reallocation of funds from ERA2 go to the most high-need Americans.

The letter, led by Senator Padilla, was also signed by Senate Majority Leader Chuck Schumer (D-N.Y.) and Senators Dick Durbin (D-Ill.), Bob Menendez (D-N.J.), Dianne Feinstein (D-Calif.), Kirsten Gillibrand (D-N.Y.), Tammy Duckworth (D-Ill.), and Cory Booker (D-N.J.).

Read the full letter here and below: 

Dear Secretary Yellen,

As Senators representing over a quarter of the U.S. population, we appreciate how the Emergency Rental Assistance (ERA) Program has been a crucial lifeline for millions of our constituents during the COVID-19 pandemic. We write to ask that unused emergency funding that is eligible for reallocation be deployed in an accelerated manner to keep families stabilized as we continue to address the current COVID-19 surge.

Amid the current surge of COVID-19, our states continue to deploy these resources as quickly as possible. However, it is clear that a significant amount of ERA2 funds remains unused across the country, while some grantees, including our states and communities, face demand for rental assistance that exceeds available resources. Based on information provided to us from our states, it is our understanding that they have obligated all funding available.

As you develop guidance for the upcoming reallocation, we echo the requests made in the attached letter sent by the governors of our states on January 13, 2022, urging the Department to:

(1)   Release new guidelines for the distribution of reallocated ERA2 funds as expeditiously as possible;

(2)   Use its statutory authority to quickly recapture and reallocate unspent ERA2 funds beginning March 31, 2022;

(3)   Prioritize reallocating funding to communities with the greatest need over simply keeping funding within states by applying a similar prioritization strategy as that demonstrated in the high needs allocation methodology established in ERA2, which factors in a grantee’s share of very low-income renter households paying more than 50 percent of income on rent, overcrowding, rental market costs, and change in employment since the beginning of the pandemic; and

(4)   Modify grantee pay-out metrics in the reallocation to better capture grantee demand.

Thank you for your consideration, and we look forward to continuing to work with you to ensure our most vulnerable communities receive these critical resources.

Sincerely, 

###