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Help is on the Way?

From: Kathleen Rutherford, Executive Director, A Better Delaware

As the pandemic enters its 17th month, rental assistance has been one of the most costly endeavors and has also increased government bureaucracy. The Delaware State Housing Authority is managing COVID-related relief through a new division of the organization, called the Delaware Housing Assistance Program which is now in its third iteration.

The new year started with another cash injection of $200 million in Emergency Rental Assistance funds in the Consolidated Appropriations Act of 2021, and $38.5 million of the $152 million in ERA funds the state was allocated in the American Rescue Plan Act.

However, in late June – nearly four months after the program began, 686 applicants had been approved for a total of $3.7 million and only 433 of those approved renters had received their payments. Even with the approval payment process  accelerated,  by August 31, DEHAP had provided rental support totaling more than $31 million to approximately 2,700 households – despite receiving $253 million from the federal government. Delaware has distributed only about 12 percent of its total funding.

Adding to this delay, DEHAP’s application page had  technical difficulties. The website was down from July 30 through August 11 – a full two weeks – for a software update. During that time, nearly 1,000 applications that were in progress were put on hold.

At the time, DSHA estimated that approximately 34 percent of applications it had received were in a “holding pattern” pending additional documentation while it estimated that about 70 percent of applicants were facing eviction.

In an effort to expediate the rent relief  process, the application  was condensed into a single form. Will this abbreviated form cloud the waters and make it difficult to reflect on how appropriately the funds are being allocated?

Only a small window remains until the moratorium on evictions expires. Originally set to expire on July 31, it was extended until Oct. 3 in counties where COVID rates remain high, which happens to include all of Delaware. It seems very unlikely that DEHAP will increase more than a year of grants nine-fold before the moratorium ends, so the obvious question is where will these remaining funds go?

Beginning on Sept. 30, the U.S. Department of Treasury is allowed to begin collecting unused funding to reallocate to other state and local programs that have used at least 65 percent of their funding to date. This opens multiple possibilities – states can either ramp up the speed by distributing their funds appropriately or getting the funding out by any means possible to reach the 65 percent threshold that will allow it to keep the remaining funds for distribution or even qualify to receive more funding. DSHA’s staff of 135 went from managing a budget of $13 million in FY21 to more than $253 million this year sifting through and reviewing more paperwork than ever before.

We fully expect that the state will manage to spend almost every taxpayer dollar of its bloated FY22 budget but is having difficulty distributing federal funds to its residents living on the brink of homelessness and landlords facing foreclosures. If Delaware’s government can’t even push free federal money out the door efficiently, do we really want them to oversee our healthcare or other programs that affect us all?