Raleigh, N.C. — New rules written into a fast-moving spending bill this week will slow down a state rental assistance effort that has already struggled to get money out quickly, the program's director said Thursday.
State lawmakers added spending caps for each of North Carolina's 100 counties to a $550 million program meant to help people struggling through the pandemic pay rent and utility bills.
That change and others are part of legislation first filed Monday and already through final passage in both the House and the Senate. This "throws a wrench" into a federally funded program that the state's Office of Recovery and Resiliency has been working to open, office Chief Operating Officer Laura Hogshead said.
"If we're having to hold back applicants ... in order to serve other applicants across the state and make sure that County Y has hit its number before we can serve more in County X, it is absolutely going to slow us down," Hogshead said.
The bill also requires the program to pay the actual rent that tenants owe instead of basing payments on a formula. One of the ways the state sped up a similar rental assistance program already underway was by basing payments on the median rent in a given area, allowing officials to award money without having to review tens of thousands of leases to verify each tenant's monthly rent.
Gov. Roy Cooper's administration has also expressed concerns that the bill doesn't set aside enough of the federal money for administrative costs.
Republican lawmakers responsible for the new rules said they're meant to ensure equity. They can also be reviewed as the program moves forward. The bill has Hogshead's office reporting back to the General Assembly in May on several topics, including potential shifts in the county spending targets.
"It's an insurance to us that the money coming from the federal government is spent all around the state where the needs are," said Sen. Ralph Hise, R-Mitchell, a Senate budget chairman.
Hise said lawmakers want to make sure the program doesn't focus too much on urban areas with better organized housing agencies or pay out on a "first-come, first-served" basis.
The funding for the new program comes from the pandemic relief bill Congress passed in December. It was actually allocated to the state Office of Recovery and Resiliency earlier this month in a separate budget bill. House Bill 196, finalized Thursday, layers on the new state rules.
That bill, which lays out some $1.7 billion in federal funding, first emerged publicly Monday. By Thursday, it had cleared both the House and the Senate in unanimous votes. It will be sent to Cooper, who is expected to sign it into law.
The new rental assistance program comes with a number of federal rules, and Hogshead said her office hasn't gotten final guidance yet on them from the U.S. Treasury, so she couldn't predict when it will open.
Her office has been running a smaller precursor to the program, though, since October, when applications for aid quickly overran an initial $167 million set aside. It's called HOPE – Housing Opportunities and Prevention of Evictions.
HOPE payouts came slower than expected, something state lawmakers have expressed disappointment over, particularly with this much larger, potentially more complicated, program on the horizon.
Hogshead said Thursday that the payment process has improved. The first rental assistance program has paid out $71.5 million and is waiting on required paperwork from landlords, utility companies or tenants to pay out most of the rest promised: about $59 million.
Hogshead said the program has only about $8.5 million it needs to pay out that it can pay out without more documentation. She said the program is emailing landlords and others who need to complete the process "every day."
"They need to check their email," she said.
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