State Comptroller Reports on ERAP Challenges

The Office of the New York State Comptroller recently issued a report on the problems plaguing the state's rent relief program. The report finds funds slow to move and not reaching low-income and minority New Yorkers. The report discusses the Emergency Rental Assistance Program (ERAP) rollout with a focus on New York City.

Distribution of COVID-19 Rent Relief

The state began accepting applications for its second pandemic rental assistance program, ERAP, on June 1, 2021. Through the Office of Temporary and Disability Assistance (OTDA), New York State intends to make use of federal aid from all rounds of funding by distributing $2.35 billion in funds allocated to it through the Consolidated Appropriations Act and the American Rescue Plan Act.

The maximum award amount is $15,000 and can be used to pay 12 months of back rent due and utility bills (gas/electric) after the period starting March 13, 2020, as well as three months of future rent if the household is rent-burdened. Residents are eligible for the ERAP if they:

• Received unemployment benefits, or experienced a reduction in income or an increase in expenses due to the pandemic, after March 13, 2020; and
• Are in rental arrears (that is, rent overdue) for rent owed on or after March 13, 2020; and
• Earn less than 80 percent of the AMI.

Acceptance into the program also confers protections to tenants, including prohibiting eviction for one year from the date of the provisional determination of eligibility, and waiving fees associated with late payments. In announcing the program, the state expected the program to serve between 170,000 and 200,000 households.

Focus on New York City

According to the report, the successful rollout of the program is particularly important for both the state and New York City. New York City had chosen not to administer its own program, where federal funding would have been limited to nearly $645 million, in order to access a larger share of the state program. New York State has the highest share of rental households in the United States (46 percent), with the majority of those households located in New York City (63 percent of all state renter households).

Given the large number of low-income households in New York City, the city’s high rent burdens, and the severity of employment loss there during the pandemic, the ERAP is likely to serve a large population of city households that need assistance. As of July 30, 2021, the OTDA reported that more than 168,000 low-income renters across the state had applied for assistance, 68 percent of whom were New York City residents. The total number of applicants amounts to less than 15 percent of the 1.2 million low-income renter households in the city alone. The four counties with the largest number of applicant households were in New York City, including the Bronx (35,490), Brooklyn (34,519), Queens (22,661), and Manhattan (18,619).

ERAP Challenges

Despite the presence of more than 517,000 rental households that earn less than 30 percent of the AMI in New York City alone, the report notes that the program had received only 168,321 applications as of July 30, 2021. Of these, 114,245 were located in New York City. And as of Aug. 9, two months after the start of the program, 7,072 households had received payments from the program, suggesting that the agency has struggled to process applications.

In addition, the state didn’t distribute ERAP assistance to any households in June 2021, the first month of the program. In response to these struggles and to concerns raised by U.S. Senator Charles Schumer about the risk of reallocation of any federal rental assistance left unallocated by Sept. 30, 2021, the state announced on July 26, 2021, that it was streamlining the program, including reduced documentation for applications, and onboarding 350 volunteer reviewers from other state agencies. The announcement also stated a target of being current on all payments for all pending verified applications by Aug. 31, 2021.

According to the report, the success of the current program will rely on processing applications and disbursing funds quickly while maintaining controls over the shortened applications. The report identified some factors likely to affect the equitable outreach and use of the program, including broadband access, technology issues with the online portal, availability of translated materials, and assistance for those who lack literacy and/or financial or computer knowledge to complete forms comprehensively.

Report's Conclusions

The report finds that outreach efforts, technical assistance, and steps to streamline applications should be targeted to reach those most in need. Other improvements to the program could include the following:

• Targeting assistance and program enhancements by geography, language, industry, age, household language, and other pertinent characteristics.
• Monitoring the program in real time to improve application completion, fund disbursement and program outreach, and enhance technical assistance efforts.
• Updating educational and outreach materials to reflect the recent simplification of forms as well as translated materials in additional languages.
• Creating a feedback loop to help community-based organizations, housing nonprofits, and local governments improve the application system and better assist tenants who require follow-up documentation.
• Advertising the newly created eviction protections gained both from applying to the ERAP and from the passage of the Tenant Safe Harbor Act.

The report says it remains to be seen what impact the state’s response will have on improving the pace of application review and funds disbursement, as well as expanding the pool of applicants. The report was critical of the information the OTDA has been providing. The report suggests OTDA should provide more detailed information, in summary form, on the types of households served by the program.

The agency’s most recent monthly report remains limited in its ability to help communities understand who is applying for relief, the size of the grants awarded, and the pace of disbursements. Such information could help target outreach efforts to people impacted by their geographical location, race and ethnicity, age, language spoken at home, and levels of income and rent burden, as well as to accelerate the processing of applications and disbursements. Shorter applications may also allow the OTDA to expand the availability of, and number of languages for, translated applications.

TAKEAWAYS

• New York was the only state that didn’t distribute any ERAP funding through June 2021.
• With low-income rent-burdened households as a measure, more than 1 million homes across the state are likely to be eligible for the program.
• NYS has the highest share of renter households in the U.S., with the majority of those households located in NYC.
• The average size of rental assistance grant awards suggests that the program may provide funding to a higher number of households than initially targeted.