COVID-19 Emergency Rental Assistance

Congress passed a COVID Relief package as part of the omnibus funding package on December 21 and it was signed into law on December 27, 2020.

The Relief package includes $25 billion in emergency rental assistance that will provide an estimated $375 million to Minnesota from the federal government. The new emergency rental assistance program has several key differences from the previous COVID-19 Housing Assistance program that Minnesota Housing offered, which requires more time to evaluate. There are significant details and timing-related issues that need to be resolved, and we do not yet know when the funding will be available for renters to access. The high-level summary of the anticipated new program includes:

• The State of Minnesota will receive at least 55% of the total funding, and cities and counties with populations above 200,000 can receive direct funding for up to 45% of the total. We are waiting for more information about how the distribution will work.

• Subject to funding availability, the assistance is expected to be available for past-due and prospective rent for three months at a time, for up to 12 months. The assistance is for low-income renter households at or below 80% of area median income (AMI), with a priority for households below 50% AMI and households that have been unemployed 90+ days.

• Eligible rental assistance expenses, which we expect will use at least 90% of the funding, will likely include rent, utilities, rent and utility arrears, and other direct rental housing related costs. The remaining 10% of the funding will likely be available for administrative costs and case management and other service costs, although much remains to be determined in this area.

• This is a one-year program, with funds expected to be spent by September 30, 2021 and a spending deadline of December 31, 2021.