Housing Policy

Democrats Want To Give Renters $100 Billion To Cope With the Coronavirus

Giving renters direct assistance is a better idea than rent cancelation, but that's not saying much.

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The rental housing market is holding up better than many expected during the COVID-19 pandemic, with the number of people paying at least part of their rent only a little lower than it was this time last year. Yet both tenant advocates and landlords fear that a prolonged economic slowdown and a tapering off of government aid could soon result in an explosion in non-payments and evictions.

To prevent this, Democrats in Congress have introduced the Emergency Rental Assistance and Rental Market Stabilization Act, which will provide renters with an additional $100 billion in assistance over the next three years.

"We must take immediate action to prevent the COVID-19 crisis from turning into a national eviction crisis. It is absolutely essential for the next COVID-19 relief package to include this bill," said Rep. Maxine Waters (D–Calif.), one of the sponsors of the House version of the legislation, in a Friday press release.

The bill, says Waters, will "help struggling renters across the nation as well as mom and pop landlords relying on rental payments for their retirement." Sen. Sherrod Brown (D–Ohio) has introduced companion legislation in the Senate.

The $2.3 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act included $12 billion in additional funding for programs administered by the U.S. Department of Housing and Urban Development (HUD), as well as moratoriums on evictions and foreclosures at properties with federal-backed mortgages.

The National Low-Income Housing Coalition (NLIHC), an advocacy group, has been pushing Congress to go much further. Its research estimates that expanding rental assistance to low-income renters who've lost jobs and income because of coronavirus would cost $116 billion over the next year.

Democrats' rental assistance bill would boost funding for HUD's Emergency Solutions Grants program by $100 billion over three years. The program received $238 million in fiscal year 2019. The agency awards that money to states and local governments in the form of grants to spend on homelessness programs.

Democrats' bill would expand that program to offer rental assistance to anyone making as much as 80 percent of median income. The HUD Secretary has the authority to approve assistance to those making up to 120 percent of an area's median income, which in some high-wage cities is above $100,000 a year.

Grantees would have to spend at least 40 percent of the money they receive providing assistance to folks earning no more than 30 percent of area median income, and at least 70 percent on assistance for those making no more than half an area's median income.

Per-household rental assistance would be capped at 120 percent of a metro area's fair market rent, as determined by HUD. But the bill would also allow the department to approve higher levels of individual assistance if they deem it necessary.

The NLIHC has endorsed the bill, as have over 100 advocacy and community groups. The idea of increased funding for rental assistance is popular with landlord groups, including the National Multifamily Housing Council.

More radical housing advocacy groups have urged policymakers to go further and actually cancel rents and mortgage for the duration of the pandemic. Rep. Ilhan Omar (D–Minn.) introduced a bill in April that would do just that.

Doing so would "have huge ripple effects throughout the institutions that own property or banks," says Emily Hamilton, a researcher at George Mason University's Mercatus Center. Providing cash assistance directly to renters is a more straightforward, much less risky policy, she says.

"It makes sense to try to make it so that people can continue paying their rent from both a public health perspective, we don't want people becoming homeless or moving into crowded living arrangements," Hamilton says.

The version of rental assistance put forward by Waters and Brown, however, suffers from similar flaws as other forms of existing federal housing assistance, says Hamilton, arguing it spends too much on middle-income people who don't necessarily need government support.

The bill also doesn't slowly taper off benefits as recipients' incomes rise, which can incentivize people to avoid earning higher wages or working more hours on the margins for fear of losing a larger dollar amount of government benefits.

Making the legislation less-targeted still is that its measure of income would count only what people are earning when they apply for assistance, and not any recently terminated income. That would mean a lot of potentially well-off, but recently laid-off renters could end up getting government support.

Hamilton argues that rental assistance should be focused on those making 30 percent of median income and that this assistance should be slowly tapered off as recipients' incomes rise, to avoid huge income cliffs.

Michael Tanner, a scholar at the Cato Institute, says it would be better still to just provide people with cash, which they can spend on rent, food, or whatever other bills they might have. Democrats' proposal runs the risk of becoming a permanent program that ends up primarily being welfare for landlords.

"What you don't want to do is set up a program that goes on forever. We should be talking about three months, not three years," Tanner tells Reason. "We want to be careful this doesn't become a boondoggle for landlords too. We don't landlords to jack up their rent just to get more subsidies from the government."

Indeed, one of the reported reasons that the percentage of people still paying at least some of their rent hasn't changed much since this time last year is that tenants and landlords have been able to work out private arrangements for rent forbearance, rent reductions, or even rent forgiveness in a few cases.

"Residents and owners are working together with payment plans, allowing credit card payments and other flexible options," Doug Bibby, president of the National Multifamily Housing Council, told CityLab.

Throwing a bunch of money at the problem would help some tenants, but it would also reduce landlords' incentives to cut deals.

House Democrats are currently working on a $1.2 trillion coronavirus response bill, according to an Axios report from Sunday. It's possible that rental assistance could be folded into this fifth economic relief package. It wouldn't be the worst housing policy proposal to pass. But given what's on the table, that's not saying much.

NEXT: Does Questioning Official COVID-19 Statistics Make This Doctor a 'Denialist'?

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  1. >>Giving renters direct assistance is a better idea than rent cancelation

    why not just go straight to the landlords?

    1. Because democrats are scum sucking villains who want to eliminate private property.

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    2. Democrats can’t buy tenant votes if said tenants are by-passed.

      1. “Time to buy us an election boys and girls!” – t. Tom Perez

    3. As Obamascam expanded Medicaid, this proposed welfare fraud will expand Section 8 subsidies.

      1. Progressives/democrats want mandatory section 8 as a percentage of housing rental units in the U.S.

        Taxes
        Inflation
        Mandates
        Bans
        Rations
        Censor non-progressives, suburbanezze, car owners, rural areas and/or based on sexual identity, gender or skin tone, immigration status.

    4. Nah, that’s what the GOP wants to do– give it to megacorp.

      1. But that’s what Keynesian corporatists like your Lightbringer do.

    5. They’re not talking about giving renters direct assistance, they’re talking about giving “advocacy groups” money to give renters direct assistance. After program expenses, of course.

      It’s the same old Democratic scam of doling out government funds for “community organizers” and “community activists” like Al Sharpton and Jesse Jackson and Barack Obama. And, Jesus, is it a sweet scam. It’s just a flat-out vote-buying scheme using the public fisc.

      As far as I can tell, most of these various public do-gooder coalitions exist mostly to pass grant money around amongst themselves and none of them lift a finger to address the actual problem. There’s a thousand “homelessness advocacy” groups and not a goddamn one of them owns a hammer or knows what a 2×4 is. No, they’re all about “organizing” and “educating” and “advocating” – i.e., give us some more money so we can keep yammering about the problem without actually doing anything about it. And you bet your sweet ass not a goddamn one of them is personally homeless – they’ve all got cushy jobs, don’t they?

        1. The Welfare Industrial Complex has overtaken the MIC

    6. Typical Leftist: “The Federal government can just buy up the rental properties and have the rent paid directly to it. This would be much more efficient and would save money because of the scale since there would be no landlords skimming off undeserved profits.”

    7. That’s exactly what this is. Assistance by the state to rentiers not to the serf/tenant class. And you can bet there will not be a single utterance of why this is what it is because there is not the remotest understanding of land in economics now.

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  3. “provide renters with an additional $100 billion in assistance over the next three years.”

    In government programs language that means “new permanent entitlement”.

    1. Providing hundreds of billions of dollars direct to students to make college tuition affordable certainly worked out well.

    2. That will grow by 10 percent every year. And magically not be considered “discretionary spending.”

  4. “Democrats’ proposal runs the risk of becoming a permanent program”

    What risk? That is an absolute guarantee.

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  6. This isn’t going anywhere. It’s just an election year ploy.

    The Republicans in the Senate have already said they’re in a wait and see mode on new bills like this, and the White House has affirmed that they’re not even willing to negotiate a new package until sometime in June . . . maybe.

    https://www.wsj.com/articles/formal-talks-paused-on-next-stimulus-package-trump-economic-adviser-larry-kudlow-says-11588952130?

    Meanwhile, the House can’t even meet–much less take a vote!

    This isn’t really a bill in the House. It’s more like a press release by Nancy Pelosi.

    McConnell says that the only bill he’s interested in is passing some kind of liability protection bill for businesses that open despite the virus. Because the hit on the economy is so bad, they’re afraid that some businesses are just closing permanently rather than sticking it out to reopen and face all kinds lawsuits from people who were infected with COVID-19 at their restaurant or wherever.

    If the President won’t sign it, and the Senate won’t even consider it, and the House Republicans won’t even return to Washington to vote on it, then it doesn’t really matter. Nancy Pelosi’s epic pronouncements simply aren’t newsworthy.

    1. “It’s more like a press release by Nancy Pelosi”
      Yes, and it’s also a way to paint the GOP as tight-fisted meanies who don’t care about the poors.

      Like you said;
      “the President won’t sign it, and the Senate won’t even consider it, and the House Republicans won’t even return to Washington to vote on it”

      Pelosi gets to call herself compassionate, and her media beagles will bark on and on about big corporate bailouts and how the Repubs won’t even debate giving aid to people struggling with rent.

      It’s a great stunt. She can’t lose.

  7. We would like for you to vote for us. In turn, we will give you money. Maybe Trump should out bid them. Can you imagine the reaction.

  8. Semi OT: I saw an article on Yahoo News today stating that there is a GRIM NEW STUDY out saying that the Years of Potential Life Lost for a WuFlu death was 12. This was supposed to be sobering, as most people think that people dying of Covid would have died of something else really soon.

    Of course YLL isn’t a literal number- it is a statistical abstract, and the idea that the guy who had heart disease and diabetes was going to live 12 more years is just a probability.

    But even more so: If you take the YLL of previous pandemics, you see that the current one isn’t at all comparable:

    YLL per 10,000
    1918 Spanish Flu: 2344
    1957 Flu: 96
    1968 Hong Kong Flu: 60
    2009 H1N1: 40
    2019 COVID: 12 YLL * 2.5 deaths per 10,000 = 30
    Typical Flu season: 19

  9. Handing money directly to everybody is certainly a better idea than running it through a government program or two first.

  10. It’s interesting, though, how people in New York City, and similar places elsewhere, see rent cancellation and paying people’s rent as a like a grass roots issue with deep resonance. The rest of America is shrugging their shoulders.

    If you live in some rent controlled hell hole (with sky high rent), I’m sure rent cancellation seems like a grass roots issue with deep resonance. That’s where, New York City, San Francisco, and Santa Monica? The rest of suburban America has no idea why this issue is supposed to have so much resonance in their lives.

    Memo to Progressive Enclaves:

    The rest of America doesn’t live in postage stamp sized apartments and pay through the nose for them. That’s just you. Most of us live in suburban three bedroom homes that would cost a fortune if they were located in one of your rent controlled progressive hellholes.

    The reason they had that fat guy on The King of Queens living in a million dollar sized home on a UPS driver’s salary was because that show was being broadcast to audiences outside of New York City–where UPS drivers really can afford to live in homes that size and really do live in homes that size. If they’d shot that show the way middle class people in New York City really live, average Americans elsewhere wouldn’t have believed it.

    The Bachelorette once dumped one of the final contestants after he gave her a tour of his apartment in New York City–because it was a dump. Well, it was actually really nice for an apartment in New York City, but because she wasn’t from New York City, she couldn’t tell the difference between a really nice apartment in the City and a dump–since that apartment would have been a dump anywhere else in the country outside of a progressive rent controlled hellhole.

    The hipsters that flooded into places like Austin, Tx, Asheville, NC, Boise, ID, Fayetteville, AR, Greenville, SC, Huntsville, AL, and Salt Lake City, UT were smarter than the progressives who stayed behind. And now that corporate America has discovered that a huge chunk of their workforce really can work from home just fine, they’re less likely to pay progressives a fortune just so they can live in an overpriced hellhole.

    No, we will not pay your rent for you.

    Love,

    The Rest of America

    P.S. You suck.

    1. In places outside New York City and the like, a working class family is as likely to have a mortgage payment to make as rent due. Why help only renters?

      1. They live in New York, and they have no conception of what life is like outside of that mentality at all.

        When you live there and you live like that, after a while you forget that the rest of the world doesn’t live like that.

        No, the rest of America isn’t like on The Andy Griffith Show, but it isn’t like New York City either.

        We all tend to think we’re the norm. It’s just that people from places where that’s the norm tend to dominate news programming and politics, so we all see it and realize how absurd it all seems.

        But, yeah, 320 million out of 330 million Americans don’t live in New York City or San Francisco. They probably don’t realize they’re asking everybody to pay their rent. They just think we’re like they are. Isn’t everyone worried about how high the rent is? If not, what’s wrong with the rest of America? What are they, a bunch of stupid rednecks?

        We could easily see New York City go back into decline again like it was in the 1970s.

        1. We could easily see New York City go back into decline again like it was in the 1970s.

          That would make the hipsters happy; well at least the ones who don’t get stabbed in a mugging.

    2. Why did Jackie Gleason on Honeymooners live in such a shit hole apartment? A bus driver was likely middle class and Brooklyn wasn’t so expensive in the 1950s. Maybe it was a union ploy to convince America that bus drivers needed a big wage increase?

      1. I can’t tell you what New York City was like in the 1950s, but I doubt that Fred and Ethel saved so much to have such a nice building for Ricky and Lucy to rent from them–so much nicer than what Ralph and Alice had. However, I know that was standard practice before Social Security and Medicaid. Old people would buy an apartment building or rent out rooms for income when they got too old to work. Airbnb is kind of a throwback that way.

  11. $100 billion is chump change compared to The Con Man’s $2.7 trillion butt-fucking given to the American Taxpayer.

    1. You can try and tie that albatross around his neck all you want shriek, and you’ll be just as wrong as you were about who cut the deficit when Obama was president.

      Because you’re a stupid garbage human.

    2. “The Con Man’s $2.7 trillion butt-fucking

      That was the House’s bill and you know it you lying fuck, and if your ilk had gotten your way it would have been twice that.

      It was your Granny BoxWine that tried to ram in provisions for “conducting risk-limiting audits of results of elections”, bailing out the postal service, same day voter registration program, a Protection for Collective Bargaining for Federal Employees Act, a program helping the airlines to fully offset their carbon emissions, community journalists retirement plans and Corporate budgets dedicated to diversity & inclusion initiatives!

      You’re so fucking dishonest.

      1. That was the House’s bill and you know it you lying fuck, and if your ilk had gotten your way it would have been twice that.

        Is that why Trump signed it and was pushing to have his name attached to every check? Because he opposed it?

        Face it, your favorite late night TV gameshow host president isn’t any better than the democrats. In fact he was one until a hot second before running for president. The difference between Republicans and Democrats isn’t even one of rhetoric anymore. They’re the same party with the same people.

  12. Southern states used to offer free housing (and food too) to po peeples.

    1. And they, too, were Democrats.

    2. You mean slavery?

  13. Democrats Click baiting to keep Biden from actually speaking longer than three minutes goes a long way– drag it out till November. Just. Hide. Biden.

  14. Subsidize something, and the price goes up. This would be great for landlords.

  15. I don’t mind if the Democrats give 100 billion to renters.
    Between Gates and Zuckerburg and Bezos, and all the career politicians with a net worth in the billions after 20 years of working for $100,000/yr, they can afford it.

    What I object to is the democrats giving 100 billion tax dollars to renters.

  16. The federal government has no basis to redistribute monies to individuals. this is not the function of government in a freemarket economy. we are teetering on full blown socialism. if you want to make the argument, this is an emergency, i will tell you government officials will tell you everything is an emergency to get them to print more money and make you dependent upon them. What i dont understand is why no one gets this dependency paradigm. Growing government gives officials a reason to exist and get paid more and more.

  17. At this point this is a pure wealth transfer. They are trying to destroy the middle class in this country. Keep the mobs happy with bread and circus’s and stratify the wealth to their corporate donors.

  18. If you just give it to the tenants, much of it will not go to rent. Many states, CA, NM, etc., have a no-eviction law currently. So, many tenants just won’t pay the rent and will leave at the end of the eviction moratorium. You and I both know regulations will be passed that don’t allow credit agencies to use delinquencies the occured during covid to be used in ratings. So, no pay rent, no problem.

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