Some Cities, States Exhaust Rental Assistance, Stop Taking Aid Applications Despite Demand

As evictions rates rise across the United States, some cities and states have exhausted their rental assistance funds and can no longer meet demands for housing aid.

Texas and Oregon have completely stopped taking new applications, with Texas having already allocated all of its funds. The city of Atlanta, Georgia, has also stopped taking new applicants.

There are other states that are close to running out of their money, such as New York and California, having spent it all or allocated it already.

"It's particularly concerning that a number of these programs are now shutting down because all funds have been expended or obligated," said Peter Hepburn, a research fellow at the Eviction Lab at Princeton University.

"If that funding gets removed, landlords may have less incentive to work with tenants," he added.

The Treasury Department believes that over $30 billion—approximated two-thirds of the money for rental assistance—will have been used or allocated by the end of the year. The Treasury is expected to start reallocating funds from cities and states not spending it to those that need it.

Despite the lack of funds, the demand for rental assistance remains. And with the federal moratorium on evictions ending, the number of people losing their homes is rising. The numbers of evictions have remained under pre-pandemic levels because of a mix of federal rental assistance and other pandemic-related assistance, such as expanded child tax credit payments that will end soon, as well.

Courts are catching up on the backlog of eviction cases, which accounts for part of the increase. However, advocates say the increase also reflects the federal emergency rental assistance's limit in places where distribution is slow and protection for tenants is weak. Another factor is growing housing prices in markets.

Rental Assistance, Spent, Increased Evictions
Texas and Oregon have completely stopped taking new applications for rental assistance amid a rise in evictions as the federal moratorium ends and other federal assistance set to end. In this September 29, 2021 photo taken in Miami, Florida, Freddie Davis waits for a friend to arrive to help him move his remaining belongings to a storage unit after receiving a final eviction notice. Rebecca Blackwell/AP Photo

According to the latest data from the Eviction Lab at Princeton University, evictions have been rising in most of the 31 cities and six states where it collects data. Evictions in September increased 10.4 percent from August. October numbers were 38 percent above August levels and 25 percent higher than in September. Filings fell around 7 percent from October to November and now remain about 48 percent below pre-pandemic levels.

Among places where evictions are returning to normal are Connecticut, as well as Houston, Indianapolis, and Cincinnati and Columbus, Ohio, according to the Eviction Lab. Florida, too, has seen a significant rise, with filings in Tampa and Gainesville returning to near pre-pandemic levels.

"There was a batch of initial commentary coming out when the moratorium ended and the tone...was, well, there wasn't a tsunami so we don't have an eviction crisis on our hands," said Ben Martin, senior researcher at Texas Housers, a nonprofit focused on housing issues.

"That initial narrative was somewhat misleading. What we are seeing is a reflection of reality, which is that evictions take time to work their way into and through the court system."

Among the concerns is that some landlords who got federal assistance are still evicting tenants. A survey of nearly 120 attorneys nationwide from the National Housing Law Project found 86 percent had seen cases like this. They also saw increasing instances of landlords lying in court to evict tenants and illegally locking out tenants.

"In many states, landlord-tenant law is antiquated and designed to provide results for landlords," said Shamus Roller, executive director of the National Housing Law Project. "Instead of adjudicating the facts, courts function as conveyor belts, moving tenants toward eviction."

As Christmas approaches, there are plenty of signs that eviction cases will keep rising.

According to the U.S. Census Bureau's Household Pulse Survey, those saying they weren't confident of paying next month's rent increased from about 5 million at the end of September to 6.3 million in the latest data.

Landlords, especially smaller ones who own a handful of apartments, have also struggled. They believed the moratorium was illegal and saddled them with months of back rent they may never get back. Others were forced to lay off maintenance staff or sell units as they awaited federal rental assistance that was slow to be distributed.

Some localities have lagged behind in getting out their portion of the $46.5 billion in federal Emergency Rental Assistance. According to a November report from the National Low Income Housing Coalition, 28 percent of grantees—32 states and 80 localities—spent less than 30 percent of their first allocation of money and risk losing those funds.

Among them is Nebraska, which spent only 6 percent of its funding through September and just 7 percent through October. Some landlords are refusing to take part in the program, said Caitlin Cedfeldt, a staff attorney at Legal Aid of Nebraska, while others have grown tired of waiting and are moving to evict. Tenants, some of whom got initial help but still face economic hardship, are being told they can't yet reapply for additional help.

Missouri only spent 18 percent of its funding through September but has since improved.

"We have so much more work to do," U.S. Representative Cori Bush, a St. Louis Democrat, said, citing data showing that evictions during the pandemic "have taken lives."

The Associated Press contributed to this report.

Rental Assistance, Spent, Increased Evictions
The Treasury Department is expected to start reallocating rental assistance funds from cities and states not spending it to those that need it. In this photo, a man walks along a street in a Los Angeles, California neighborhood on July 30, 2021. Frederic J. Brown/AFP via Getty Images