Treasury shifting more than $1 billion within states or to high-demand programs in first round of reallocation.
WASHINGTON — State and local governments provided assistance to approximately 665,000 renters and landlords in November 2021 with funding through the Department of the Treasury’s Emergency Rental Assistance (ERA) programs, bringing the total number of payments for the ERA programs to more than 3.1 million. The $2.9 billion in ERA expenditures from both ERA 1 and ERA 2 funds in November 2021 represents the largest amount of assistance paid to eligible households and the largest number of payments made in any month since the programs were created. Due to the Administration’s efforts to prevent evictions, including the significant progress shown in the implementation of ERA programs, eviction filings remain well below pre-pandemic levels. Eviction Lab data shows that in the four full months since the end of the eviction moratorium in August, eviction filings have remained below 60 percent of historical levels.
Treasury’s efforts to provide grantees with additional flexibilities and highlight promising practices have helped speed up the pace at which these funds are reaching renters in need. This is the third straight month of over $2.8 billion in ERA spending and over 500,000 payments under the programs. Treasury projects that approximately $25 to $30 billion of combined ERA 1 and ERA 2 funds were spent or obligated by the end of 2021, based on the pace of spending and obligation through the end of November.
The ERA 1 statute required Treasury to begin a reallocation process on September 30, 2021, whereby “excess funds,” that are not obligated, are recaptured from grantees and reallocated to eligible grantees that obligated at least 65 percent of their total ERA1 award and have a demonstrated need for such funds.
There will be multiple rounds of ERA 1 reallocation. In this first round of reallocation, Treasury will disburse over $1.1 billion in ERA 1 funding, more than three-quarters of which are significant, one-time transfers proposed voluntarily between ERA 1 grantees in the same state. Any amounts recaptured from a grantee were first prioritized to grantees in the same state that were deemed eligible to receive reallocated funds. Funds were then distributed nationally, prioritizing grantees that had substantially completed their spending of ERA 1, with grantees that made more rapid progress on the expenditure of their ERA 2 funding weighted more heavily. The rapid utilization of ERA funds across the country meant that only a limited amount of funding would be reallocated.
Treasury has now begun informing grantees about the process for requesting funding in the second round of ERA 1 reallocations. The deadline for submitting a request for the second round of reallocated funds is January 21, 2022. By statute, the process for reallocating ERA 2 funds will not begin until March 31, 2022, and Treasury will publish separate guidance for this reallocation.
Treasury is encouraging states and localities to use other sources of funds, including the $350 billion Coronavirus State and Local Fiscal Recovery Funds, to provide additional support to renters – as several communities are already doing. Treasury is also encouraging states and localities to continue to implement other policies and procedures to prevent evictions.