Austin’s got millions to help with rent, but giving it away is harder than expected

The city of Austin says fewer people have applied for rental assistance than expected. It’s given out just $1.3 million so far of roughly $13 million available for tenants hit financially by the Covid-19 pandemic.

“The need that was anticipated has not manifested. We are hearing stories but we’re not seeing it,” Nefertitti Jackmon, housing and policy manager with the city’s Housing and Planning Department, said. “There are so many factors that we really don’t know exactly what’s going on.”

While most Austin renters have been protected from eviction during the pandemic, housing advocates worry that those who have not been able to pay rent won’t be able to come up with what they owe to avoid eviction when bans expire. According to a census survey done in September and October, about 11 percent of Texas renters say they have no confidence they’ll be able to afford next month’s rent.

So, the city has stepped in to help.

In August, the city and the Housing Authority of Austin opened a second round of rental assistance after seeing huge interest in a similar program last spring. Eligible applicants had to make less than a certain amount and be on a formal lease. The city used its own money to pay a total of $1.3 million in rent for 1,681 households.

But the need was much greater: Nearly 11,000 people applied for help, with about half of the applicants qualifying for the program.

In response, the city prepped a much bigger program that began in August, dedicating $12.9 million to rent assistance – paid, as it was last time, directly to landlords. Much of the program uses federal dollars from the CARES Act.

The city anticipated it would pay tenants’ rents at a pace of $2 million, or about 2,000 renters, per month. But two months in, the city has given out just a little over $1 million – a fourth of what it thought it would have by now.

And according to the city, this money has a deadline. Jackmon said the federal funds need to be spent by the end of December.

“We have not been provided any specific details in terms of what might happen,” she said. “We’re hoping for an extension to be able to expend the funds.”

As for the lag in interest, Jackmon said several factors may be keeping people from applying. The application is online, so a lack of internet access or computer literacy could be a problem.

But it’s also possible that fewer people are in need of rent help at this point in the pandemic. That’s what Walter Moreau, the executive director of Foundation Communities, thinks is happening.

“The social service part of me wants to say there’s a crisis,” Moreau said. “But the actual need is not as urgent at the moment as we feared, because people have been able to go back to work.”

According to the Texas Workforce Commission, the unemployment rate in the Austin area at the start of the pandemic was 12.2 percent. It has since rebounded to 6.4 percent.

Moreau said less than 10 percent of Foundation Communities’ tenants have been unable to pay rent, a number that’s remained steady since the pandemic began.

He noted local health officials predict another upswing in Covid-19 cases, and cautioned there might be a surge in the need for rent help months down the road.

“We’re not over this yet,” he said.

Foundation Communities is one of 14 nonprofits chosen to receive grants from the city to market the assistance program to renters it works with. But while the city announced these organizations in a memo dated Sept. 16, it has yet to finalize the contracts, meaning some nonprofits haven’t begun the work.

“We have not been able to launch our outreach assistance for the program, because we don’t have our marching orders yet,” Rob Faubion, spokesperson for AGE of Central Texas, another nonprofit on the list, wrote in an email to KUT.

As of Thursday, the city had paid rent for 1,138 households. But more than four times that number, roughly 5,600 people, have applied for help in this latest round. The city would not say how many of these applicants it deemed ineligible for the program, writing in an email that staff didn’t want to release that number without more analysis. KUT filed a public information request for the data, but has yet to receive it.

Hanna Barakat, a musician who’s been out of work since March, got rent help from the city in the first round of funding in May. But this time around, the city told her she was ineligible.

“How is it possible that I did not qualify for round two when I qualified for round one?” she wondered.

It turns out that while Barakat lives within city limits, she does not live in the city’s full-purpose jurisdiction, meaning she gets only certain city services. The city tweaked the requirements for this second round of funding, excluding those who live in certain “gray areas” of the city.

Barakat said she’s unsure how she and her husband will pay November rent. The couple has started selling music gear to pay for necessities and is considering selling their TV.

“It’s been a scary nightmare,” she said.

This story was produced as part of the Austin Monitor’s reporting partnership with KUT.

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