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New Federal Funding for Rent and Utility Assistance

New Federal Funding for Rent and Utility Assistance

This blog provides an overview of new funding available through the Coronavirus Response Relief Supplemental Appropriations Act (CRRSA) to help with rent and utility assistance for any households impacted by the COVID-19 pandemic.

Coronavirus Response Relief Supplemental Appropriation Act

The federal government approved another round of relief from economic impacts of the COVID-19 pandemic with the passage of the Coronavirus Response Relief Supplemental Appropriations Act (CRRSA) on December 27, 2020.

States where its legislature was in session were required to appropriate the CRRSA funds before being able to receive them. In February, Washington State lawmakers passed House Bill 1368, which appropriated the $2.2 billion dollars Washington is receiving from the federal government.

Part of CRRSA funding includes rental and utility arrears assistance for individuals and households impacted by the COVID-19 pandemic, and Washington State appropriated $325 million for emergency rental and utility assistance. Funding allocations to each county in the state will be based on the number of unemployed individuals and the number of renters living within the countywide area. These allocations will be reduced if a county also receives direct funding from the federal government.

How funding will work in Washington State

The Office of Family and Adult Homelessness at the state Department of Commerce will be administering the CRRSA funds through the Treasury Rent Assistance Program (T-RAP). T-RAP is separate from Commerce's Eviction Rent Assistance Program (ERAP), which is funded through the State of Washington. Unlike ERAP, T-RAP is federal funding and provides both rent and utility arrears assistance. The only time utility arrears is covered under ERAP is if a landlord, not a tenant, pays directly for the utilities and factors this cost into the rent.

For the T-RAP program, Commerce will use the same grantee agencies it uses to distribute assistance as part of the ERAP program, which includes local governments and nonprofits. Information about the program, including a list of grantee agencies, can be found on the Commerce's Homeless Assistance webpage.

Eligibility for assistance

There is not enough funding to provide assistance to all Washingtonians who are likely to be eligible under the T-RAP program. Eligibility screening will be used to target those who are most likely to become homeless without assistance. The federally required screening criteria for an eligible household is as follows:

  • Has a household income at or below 80% of area median income (AMI),
  • Is experiencing a financial hardship directly or indirectly due to the COVID-19 pandelic that threatens their ability to pay the costs of the rental property when due, and
  • Is at risk of experiencing homelessness or housing instability.

Priority must be given to households:

  • That have a combined income at or below 50% AMI, and
  • That include one or more individuals who are unemployed and have been unemployed for 90 days before application date.

Households can receive up to twelve months of financial assistance, and after this period may receive an additional three months assistance, if necessary, to ensure housing.

The financial assistance can be used for a combination of rent and utility arrears. Payment can be up to 150% of fair market rent (FMR) and must not be more than the total amount due (this percentage may change). FMR calculations should not include the cost of utilities. Assistance cannot be provided for any arrears that were accrued prior to March 13, 2020.

Eligible utility arrears include electricity, gas, water and sewer, trash removal, and energy costs, such as fuel oil; however, these services must be in arrears. Households are not eligible to receive assistance of payments for utility services that they have not yet received. Any utility assistance will be paid directly to the utility provider.

Outstanding Receivables: Is Hope on the Way?

Most utility providers have experienced a higher percentage than normal of customers with outstanding utility bills during the COVID-19 pandemic, and the T-RAP funds will hopefully provide some relief. Since those households that receive T-RAP utility assistance will have these funds paid directly to the utility provider, local utilities should consider reaching out to delinquent customers to make them aware of this new resource.

Utilities across the state have utilized different approaches to make customers aware of existing utility support programs. Some options for promoting the new T-RAP funds may include billing inserts, direct mailings to households on the outstanding receivable list, and website updates that include links both to the T-RAP program and to the local agency offering funding assistance for utility billings in arrears.  

There is no word yet on a firm date when the T-RAP funding will be available. For additional questions, please do not hesitate to email me, use our online Ask MRSC form, or call us at (206) 625-1300 or (800) 933-6772.

MRSC is a private nonprofit organization serving local governments in Washington State. Eligible government agencies in Washington State may use our free, one-on-one Ask MRSC service to get answers to legal, policy, or financial questions.

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About Eric Lowell

Eric Lowell joined MRSC in December 2020 as a Finance Consultant. He has been involved in local government finance for over 13 years, including working in city government as well as for a special purpose district.

Eric received a B.A. in Secondary Education from Arizona State University and a B.S. in Accounting from Central Washington University.