Housing advocates say Minnesota hanging onto $85M in rental aid as evictions spike

A group of housing advocates is urging state leaders to give out $85 million in federal housing aid as soon as possible amid record numbers of eviction filings across the state.

Several housing advocacy groups have formed the MN ERASE (End Rental Arrears and Stop Evictions) Campaign, which sent a letter in December to Minnesota Housing, the state's housing agency, asking for the disbursement of the remaining emergency assistance funds. Other nonprofits that help with eviction also say they want to see the money used.

When the letter was sent, the unspent aid was $75 million. That pot of federal money has grown to $85 million due to another allocation earlier this month, Minnesota Housing said.

"In the meantime, people are getting evicted for not paying their rent," said Mary Kaczorek, a managing attorney with Mid-Minnesota Legal Aid. "It's really frustrating from where we sit."

Minnesota Housing officials said they're working on getting the funds out. Officials are developing a proposal of how to use the money based on public input, which was gathered through a December survey.

The money could be used for rental assistance to targeted groups, such as those facing eviction, homelessness or domestic violence, said Jill Mazullo, the agency's spokeswoman. Much of it could also be used to create and preserve rental housing that's affordable to very low-income households.

Many who took the survey want to see it used for both purposes, Mazullo said, which is also a possibility.

Distributing the money will require a new way to process applications, since the state cannot just reopen the RentHelpMN portal it used previously. The infrastructure behind it no longer exists, Mazullo said.

"No matter which direction we go, we will need to build the program before we can roll it out," she said.

Margaret Kaplan, president of the Housing Justice Center and part of MN ERASE, said the $85 million should be used for emergency rental assistance today while other funds should be used to construct and operate affordable housing.

Evictions continue

Eviction filings across Minnesota have soared this winter as inflation takes its toll on household budgets and the state continues to wrestle with a lack of affordable housing. January's eviction filings were about 47% higher than in both January 2019 or 2018, the last "normal" years before the pandemic hit.

"It's bad, and it's been bad for a while," said Kaplan. "And there are such limited resources available to address the need."

January 2023 saw 2,118 eviction filings — higher than the 2,099 and 2,080 filings in June and July 2022, respectively, the months following the end of the state's eviction moratorium. Many in the housing industry have said they expected large numbers of eviction filings during those months.

Minnesota Housing gave out nearly $450 million in federal emergency rental assistance to about 70,000 households through RentHelpMN in 2022 and 2021, officials said. In 2020, the agency distributed about $58 million to 22,000 households through its COVID-19 Housing Assistance Program.

Gov. Tim Walz's budget includes an additional $100 million over the next two years for the state's Family Homeless Prevention and Assistance Program, which helps people with rent payments and other housing-related costs.

Problem not subsiding

The high numbers mirror other indicators that more people are having trouble paying their rent.

At HOME Line, a tenants' rights organization that operates a hotline, January 2023 saw the highest call volume in the nonprofit's 30-year history, said Eric Hauge, HOME Line's executive director.

"Evictions are still at the top of the list [of call reasons], so it's pretty clear things are not slowing down," he said in an email.

Since March 2022, eviction-related questions have been the number one reason people call, the HOME Line newsletter said, which isn't typical. Usually, calls about repairs take the top spot.

Hauge said there's an "immense, immediate need" for emergency rental assistance.

The application process to get aid should be as easy, fast and accessible as possible, he said.

Kaczorek, from Mid-Minnesota Legal Aid, said the renters facing eviction she encounters now are a few months behind on rent — not the six months to a year that was common during the pandemic.

Growing frustration

Knowing the state has money it's not handing out is frustrating, Kaczorek said.

"I think that they are being too deliberate at this point and [the money] needs to get out in the community," she said.

Kaplan, of the Housing Justice Center, noted that people who are evicted lose not only their home, but ties to their community. And an eviction makes it difficult to find housing in the future.

The state also needs to come up with a long-term, sustainable strategy to provide emergency housing assistance, she said.

"We really need them to move much more quickly than they are because there are these human consequences to every moment that we wait," Kaplan said.