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State and local governments who didn’t commit at least 65 percent of their first round of federal Emergency Rental Assistance (ERA) Program money before Sept. 30 are liable to lose the remaining funds soon, a U.S. Department of the Treasury official told Atlanta Civic Circle on Friday.
According an Oct. 4 letter, from Treasury Department Deputy Secretary Adewale Adeyemo to ERA program grantees, the agency plans to “make more resources available to high-performing grantees based on need, incentivize adoption of best practices among grantees to help them streamline and improve their processes and work to ensure funds do not go unused by programs unable to assist struggling renters and landlords.”
The Treasury Department intends to “[recapture] dollars from the lowest performers that have been unable or unwilling to speed up assistance,” the letter says.
Struggling agencies who hope to retain the yet-unspent millions of dollars — including Georgia’s Department of Community Affairs (DCA), which, at last check, had distributed just 7 percent of its $552 million — must submit a “program improvement plan” to federal officials, according to the Treasury Department.
To be clear, Treasury officials say the 65-percent threshold is based on obligations, not spending, meaning agencies distributing the ERA money, such as the DCA, are judged on how much they’ve promised to people — even those whose applications might not have been processed yet.
DCA deputy commissioner of housing Tonya Curry did not answer Atlanta Civic Circle’s questions regarding the Treasury Department’s plan to seize and reallocate ERA money, nor did she say how much of the agency’s ERA purse had been obligated to households in need. “$552 million is a very large tranche,” she said of the first batch of federal money, “and we’re getting out a lot of money every day.”
ERA grantees can avoid forfeiting funds if, by Nov. 15, they can prove to the Treasury Department they’ve spent at least 30 percent of the first round of cash or have obligated at least 65 percent of it.
DCA spokesman Adrion Bell told Atlanta Civic Circle on Wednesday that the agency doesn’t expect to give any money back to the Treasury Department, despite seemingly being well behind the goals outlined by the federal government. Bell did not respond to follow-up questions about why Georgia is disbursing ERA money slower than most states and whether the DCA has instructed its distribution partners to relax cumbersome paperwork requirements for applicants.
In August, the Treasury Department encouraged state and local governments to ease mandates related to the documentation ERA program applicants must provide to get assistance, including allowing people to self-attest to the financial and housing hardships they’re facing due to the pandemic.
ERA grantees were expected to provide their first-round data (up to Sept. 30) by Friday. DCA officials have not yet told Atlanta Civic Circle whether they submitted the information, so it appears that the fate of the agency’s ERA program is up in the air.