Under President Joe Biden’s massive American Rescue Plan, the state of California was on the receiving end of more than $27 billion, in addition to a combined $4.7 billion in funds disbursed specifically for rental assistance.
“Under the current program, landlords would get eighty percent of the rent that they are owed in exchange for forgiving twenty percent of the rent and clearing the rental debt from the tenant,” according to Russ Heimerich, a spokesperson for California’s Business, Consumer Services, and Housing Agency, per ABC News.
“What the governor proposed in May, and what they’re working on right now, is raising the reimbursement rate to 100 percent,” he added.
For those who are deemed eligible for the federal assistance, they could potentially be on the receiving end of $25,000 to cover both missed and future rent for up to eighteen months.
“The Treasury (Emergency Rental Assistance) program includes an unprecedented amount of funding for emergency rental assistance to help renters stay stably housed,” writes the National Low Income Housing Coalition.
Like Newsom, other governors across the United States are proposing how they wish the federal cash to be spent in their respective states. For example, Florida Gov. Ron DeSantis has called for using the money to issue $1,000 bonus checks to first responders and teachers.
“We’re proud of the teacher compensation momentum we have, and we’re proud of these $1,000 bonuses for principals and for the teachers,” DeSantis recently told reporters.
“We think that when the schools are open, when people are working hard and putting the kids and families first, you know, we want to reward that sacrifice,” he added.
In addition, to help to settle back rent, Biden’s stimulus bill is also making sure to assist struggling homeowners via the nearly $10 billion Homeowners Assistance Fund (HAF), which aims to provide direct cash payments to states, territories, and tribes to financially support their property owners.
“The purpose of the Homeowner Assistance Fund is to prevent mortgage delinquencies and defaults, foreclosures, loss of utilities or home energy services, and displacement of homeowners experiencing financial hardship after January 21, 2020,” the Treasury Department says on its website.
“Funds from the HAF may be used for assistance with mortgage payments, homeowner’s insurance, utility payments, and other specified purposes,” it adds.
Eligible homeowners also must have income equal to or less than 150 percent of the area median income, have proof of the stated financial hardship, and have a mortgage balance that is less than $548,250.
Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.