This article was first published in Greater Greater Washington on June 24.
Federal rental assistance is finally flowing in Maryland, but it won’t help as many tenants as it should. Two reasons explain why. First, rental assistance is coming just as other federal and state protections are being rescinded. Some may get evicted before their relief shows up. Second, the programs that distribute the money don’t do enough to protect holdover tenants — renters whose leases lapsed during the pandemic. Rental assistance may help them get caught up on their rent, but it won’t help them get leases renewed — something they’ll need if/when eviction moratoriums end.
When the pandemic began in mid-March of 2020, millions of Americans lost their jobs. Congress responded with a variety of measures, including stimulus checks for individuals and cash for states to beef up their unemployment benefits. For their part, states redeployed funds set aside for other purposes to fill in the gaps. Unfortunately, federal and state aid often came late (or not at all), and required navigating hastily built and inefficient online portals. The Urban Institute estimates that by January 2021, renters had collectively racked up $57 billion in unpaid rent.
Ten months after the pandemic began, Congress finally appropriated money specifically for rental relief. In January 2021, it set aside $25 billion for an Emergency Rental Assistance program. In March it appropriated an additional $21.55 billion.
Money from both pots was distributed to states and large jurisdictions within them. Maryland, for example, received $259 million, while its eight most populous counties/cities received $143 million. The funds are supposed to help tenants pay their rent, stabilizing them, and helping their landlords stay afloat.
To see how the money is distributed on the ground, let’s look at Prince George’s County, one of the Maryland counties hardest hit by the pandemic. As of June 23, Prince George’s has had the highest number of Covid-19 cases (85,470) in the state, and the third highest number of deaths (1,593). It has also experienced higher rates of unemployment than the state as a whole (in 2021, 8.2% and 6.8% respectively).
In Prince George’s, federal rental assistance is being distributed through the county’s Emergency Rental Assistance Program (ERAP). There are two ways to apply. Tenants can apply individually, or landlords can apply on their behalf. In both processes tenants can receive up to 15 months of back rent and utilities. However, when landlords apply on behalf of tenants, the landlord also must agree to two stipulations. If the tenant has back rent from before April 2020, the landlord must agree to permanently waive thirty days of it. The landlord must also waive any self-help actions such as eviction for 90 days after receiving an ERAP payment.
Given the patchwork of assistance to date, ERAP is a safety net of last resort for most tenants. Unfortunately, the net has some gaping holes in it. Two factors explain why—the timing and structure of the program.
Although federal monies were appropriated in January and March of 2021, states and jurisdictions within them had to stand up programs to distribute the aid. This takes time. The ERAP program was slated to go live in Maryland jurisdictions by May 17 at the latest. Some counties like Prince George’s were up and running earlier, but because of the flood of applications, it can take two months before a submitted application is even reviewed.
This is not to say Prince George’s County is doing something wrong. By all accounts they’re doing a great job. Trent Leon Lierman, who helps tenants and landlords in Prince George’s County apply for rental relief as part of his work at the non-profit CASA, told me the County’s program “got off the ground a full month and a half before Montgomery County.” He said the extra time was important because “we are all racing against a ticking time bomb.”
As Leon Lierman’s comments suggest, important deadlines loom. To date, eviction moratoriums are the most important protection tenants have had during the pandemic. Though the specifics vary by location, most moratoriums place a temporary ban on eviction proceedings in court. Moratoriums don’t cancel existing eviction orders, they just postpone them, buying tenants time to figure out their next steps. The first moratorium was established through the CARES Act passed in March of 2020. When that expired in July of 2020, the Centers for Disease Control’s (CDC) announced its own moratorium, which went into effect in September 2020. Many states, Maryland included, also created state-wide moratoriums. One study estimates that “1.55 million fewer eviction cases were filed in 2020 than in a normal year.”
This backstop, though imperfect, was abruptly called into question on May 5, when a federal judge vacated the CDC’s moratorium. Although the judge agreed to stay her ruling so the Biden administration could appeal, the CDC announced in late June that it was ending the moratorium after one final extension through July 31, making an appeal moot and alarming tenants in the process.
Maryland’s ban now has an end date as well. The state moratorium was tied to Maryland’s state of emergency, which Governor Hogan just announced will expire on July 1. Although the state’s eviction moratorium was given a 45-day grace period (until August 15), this won’t be enough time for many tenants to stabilize. If they are evicted, they’ll get even further behind.
The timing also means that landlords may soon be able to choose between receiving back rent and evicting tenants. And, as strange as it may seem, landlords may choose eviction. Some landlords, for example, may want to retaliate against activist tenants. Before the pandemic, rent strikes were uncommon, but not anymore. Tenants have also become more willing to publicly shame their landlords for refusing to set up payment plans or make basic repairs.
The pandemic has also created other incentives for landlords. Even as millions of families struggle to keep a roof over their heads, real estate has been appreciating at a rapid clip, especially for single-family homes. Landlords of single-family homes may decide the profit from a sale in this market is greater than what they’d get by breaking even on overdue rent.
Even landlords of multifamily properties may decide that selling or redeveloping their property for the luxury market is a better deal in the long term. Tenants in properties along the proposed Purple Line, for example, are worried their landlords will take advantage of the pandemic to clear their buildings in an effort to more easily sell or redevelop them.
The ERAP program also has limitations. Notably, it doesn’t provide robust protections for holdover tenants. Rental leases are usually for one year at a time, so most tenants would have had their leases come up for renewal during the pandemic and many of them wouldn’t have been in a position to renew. We don’t know how many holdover tenants there are in Maryland, but we can get some sense of the scope by looking at evictions on hold over grounds (most moratoriums didn’t preclude hold over evictions). In Maryland, the number of holdover evictions in 2020 (552) increased 117% from the prior year. The total number of holdover tenants is likely much higher, not only because most leases would have come up for renewal at some point during the 15 month pandemic, but also because some landlords would have declined to evict holdover tenants on moral or practical grounds (e.g. backed up court dockets).
Like the eviction moratoriums before it, the ERAP program doesn’t protect holdover tenants. To be fair, however, it does allow tenants to provide utility bills, “attestation by the landlord,” or other documents in lieu of a lease in their application materials. However, without a standing lease, landlords are not required to renew tenants’ leases, even if they get caught up through rental assistance. Indeed, landlords who apply for rental relief on behalf of their tenants are only required to stay evictions for 90 days. Thereafter, they can evict tenants without valid leases.
Assistance programs work best when they reinforce each other. Rental assistance is providing much needed relief for thousands of tenants. But, if those same tenants can’t use that money to get caught up, and stay in place, then assistance isn’t working as it should.
A key goal of rental assistance is to stabilize families thrown into chaos by the pandemic. Delaying the chaos by a few months isn’t a solution; it’s ‘kicking the can’ down the road. Maryland should extend its eviction moratorium and establish a sunset date that matches the needs of low income tenants who want to get caught up but need time and help to do so. It should also require landlords who accept rental assistance from the state or one of its counties to renew leases for tenants who get caught up on their rent.
Carolyn Gallaher is a geographer and associate professor at American University.
