'Help is coming': Minnesota prepares for $375 million in federal rental assistance to arrive

Minnesota housing officials and advocates are urging residents to hang on for a few weeks longer as $375 million in rent assistance arrives from Washington thanks to the stimulus bill.

Julia Welle Ayres, housing development and finance manager for Hennepin County, said many people working in the housing space had "never seen this much money come in quickly." She said they're hoping by end of the month or early February to open up applications for assistance.

It's a welcome reprieve for Hennepin County officials who last year quickly spent $17 million in federal emergency rent assistance to help 6,000 households.

"The thing we want residents to hear is that help is coming," Welle Ayres said. "Really what we want is patience, is for tenants and landlords to hold on, because help is coming so we can pay those bills and keep everybody afloat."

The federal bill includes $25 billion in emergency rental assistance nationwide and extended the federal eviction moratorium until Jan. 31. The federal moratorium — seen by housing advocates as a fail safe if states decide to end their own — requires tenants to prove they cannot afford rent and have made efforts to seek assistance. Gov. Tim Walz has extended Minnesota's eviction moratorium to Feb. 12.

The stimulus bill funding comes as the pandemic wears on and Minnesota households continue to face the harsh realities of the economic downturn. In the early months of the pandemic, state, county and city officials were overwhelmed by applications from people desperate for rent assistance, food assistance, unemployment benefits and more. Money ran out as the need outpaced the resources available.

In addition, the state's stop on eviction proceedings for nearly a year has kept tenants housed but exasperated landlords who say they have little cash to cover repairs and property taxes as rent goes unpaid. The eviction moratorium does not give residents a pass on paying their rent. Tenant rights advocates have expressed concern that residents are getting months behind on rent and may face eviction when the moratorium ends.

James Baron, a north Minneapolis landlord, who is also president of Gather Minnesota, an organization focused on helping housing providers, said when he received his stimulus check, he used it to pay his property taxes.

Baron said some of his tenants have not paid rent for months. While the new rent assistance might help, he's hoping property owners will be told how they can easily seek assistance or apply on behalf of their tenants.

"Just because there's a pandemic does not mean that the landlord does not have bills," Baron said. "Once I received my stimulus payment, I had to pay a penalty and interest on property taxes. ... That just digs into my ability to then keep rents low, it digs into my ability to do painting, improve furniture, do maintenance, that money has to come out of somewhere."

Minnesota Housing Deputy Commissioner Rachel Robinson said in a statement that the agency is working on coordinating with local governments and tribal nations on this new program.

"Last year, we partnered with local administrators for the $100 million in COVID housing assistance where we took specific actions to reach every corner of [the state] and make the funds accessible and available as possible," Robinson said. "Our goal with the new resources is to see this funding reach every Minnesota renter who needs the assistance and is eligible under the federal requirements."

The new stimulus bill allows states and counties to give residents 12 to 15 months of rent assistance, something that was not allowed with CARES Act funding. Counties and the state will determine what to do. Ramsey, Anoka, Dakota, Washington counties and the cities of Minneapolis and St. Paul will get their own allocation of money.

Officials are also hoping for this next round of applications to have a shared statewide system where residents don't have to guess which programs to apply for and can easily check the status of their application.

Kari Johnson, senior policy adviser for the Metropolitan Consortium of Community Developers, said advocates are disappointed state legislators failed to pass their own housing relief package last month. Johnson said there's uncertainty about homeowners who have been left out and what happens when assistance potentially winds down in the coming months.

"Knowing that we had an estimated $375 million in rental assistance is coming to Minnesota, that is a huge relief, but I will also say that ultimately that doesn't cover mortgage assistance," Johnson said. "Many of those homeowners do qualify for deferment but at the same time I'm worried about what those long term consequences are. ... There's just so many unknowns."

Marissa Evans • 612-673-4280