Committed to improving the health and well-being of all people across every state.

With a Federal Eviction Moratorium in Place, States Develop Additional Protections for Low-Income Renters

Last week, the Centers for Disease Control and Prevention (CDC) issued an agency order temporarily halting residential evictions for nonpayment of rent due to COVID-19 through the end of 2020. This unprecedented action, which includes no provisions address landlords’ lost income, identifies housing as a key tool to prevent the spread of COVID-19. Alongside this federal action, states can implement additional initiatives to help low-income renters avoid eviction.

With more than 16 million Americans unemployed, 43 percent of renters were unable to pay their rent at the end of July. It is estimated that 19 to 23 million renters will be at risk of eviction by the end of September. Housing affordability is not a new issue in the United States, but one that is exacerbated by the COVID-19 pandemic. Prior to the pandemic, nearly 21 million renters were cost burdened – spending at least 30 percent of their income on rent. Individuals and families who rent have lower incomes than homeowners and are less likely to have savings to cover unanticipated expenses or emergencies.

Housing is an important social determinant of health, and especially critical now as housing insecurity is associated with an increased risk of COVID-19 infection and mortality.

The $2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES) Act provided essential, one-time $1,200 stimulus checks, enhanced unemployment benefits, and a moratorium on evictions for renters in properties financed by federally backed mortgages. Analysis by the Urban Institute revealed the CARES Act protected 12.3 million renter-occupied, federally financed units, which account for one in four total rental units. The CARES Act eviction moratorium and the enhanced unemployment benefits expired in late July. The CDC eviction moratorium provides more protection for renters than the CARES Act moratorium by covering all rental properties.

The CDC agency order explained, “… housing stability helps protect public health because homelessness increases the likelihood of individuals moving into congregate settings, such as homeless shelters, which then puts individuals at higher risk to COVID-19.” Renters who declare they expect to earn less than $99,000 a year ($198,000 if filing jointly) are protected from eviction until Dec. 31, 2020. Renters will still be responsible for paying rent, including the unpaid “back” rent, after the order expires and can be evicted for other lease violations.

Before the CDC’s action, Moody’s Analytics estimated renters would owe nearly $70 billion in back rent by the end of the year. Moody’s estimate included 12.8 million renter households who would each owe on average $5,400.

While the CDC action protects renters, it creates economic hardship for landlords for whom that lost revenue is significant. A recent study found that over 50 percent of property owners manage four or fewer units, and rely on rent from their units for operating costs and income. A long-term reduction in rental properties could also jeopardize the affordable housing market — there is already a shortage of more than 7 million homes for low-income renters.

Housing and Health Equity

Access to housing is an important driver of health outcomes. Research indicates that eviction can lead to homelessness, housing instability, and increased use of emergency health care services. The threat of eviction is associated with negative mental and physical health outcomes including depression, high blood pressure, and child maltreatment. Eviction prevention can also save states money. In New York, keeping one family in a home saves taxpayers $68,422 per year in shelter costs.

Historically marginalized populations have experienced higher rates of COVID-19 infections and mortality, and are also more likely to be at risk for eviction. These inequalities are driven by structural racism and policies, such as redlining, that created barriers to homeownership for people of color. Today, nearly 70 percent of White residents own their homes compared to 42 percent of Black residents and 48 percent of Latinx residents. Black and Latinx workers are also more likely to be unable to work from home, making it more difficult for them to earn income to pay rent.

July 2020 data from the Household Pulse Survey reveals that more than 40 percent of Black and Latinx households had no or only slight confidence they could pay their rent next month compared to 21 percent of White renters. Additionally, in 17 states, Black women are twice as likely to have eviction notices filed against them as White renters. Eviction filing histories also make it more difficult for renters to secure rental properties in the future.

State Actions

With federal unemployment assistance expired and a federal eviction moratorium set to expire at the end of the year, states are providing additional protections and financial assistance to low-income renters. In March, 43 states and Washington, DC passed eviction moratoria, with more than half expiring by early August. States are now looking at other policy levers to protect low income renters and landlords through leveraging federal funding, executive actions, and legislation. The following states actions outlined below provide protections above the current federal moratorium and some provide landlords with direct financial assistance.

Leveraging federal dollars to support low income renters:

  • In Arizona, the Department of Housing is partnering with community action agencies to assist renters through the Rental Eviction Prevention Assistance Program. Renters who have lost more than 10 percent of their income are eligible to apply. As of late August, 1,794 households were approved, representing 8 percent of total applications. The program is currently funded by $5 million dollars from the State Housing Trust Fund.
  • The Illinois Housing Development Authority created the Emergency Rental Assistance Program with CARES Act funding directed to the agency from the General Assembly. The $150 million-dollar fund will provide eligible tenants one-time $5,000 grants paid directly to their landlords for missed rental payments or to cover upcoming rental payments through December 2020. The program is expected to assist 30,000 tenants this year.
  • Michigan’s Eviction Diversion Program provides $60 million in CARES Act funding for rental assistance, case management, and legal services to support those with eviction filings. Rental assistance is income-based and allows for one-time payments up to $3,500.
  • Montana used $50 million of its CARES Act dollars to create an Emergency Housing Assistance Program. Financing from the program caps family’s rent or mortgage contributions at 25 percent of their net income. As of late August the program had awarded approximately $2.5 million to reaching more than 830 Montanans with an average of three months of assistance and $2,822 per household paid to landlords and mortgage servicers.
  • North Carolina Gov. Roy Cooper allocated $175 million federal dollars to support North Carolinians’ economic stability. Federal Community Development Block Grant Coronavirus funding ($28 million) and CARES Act Coronavirus Relief Fund ($66 million) dollars will be used to support rental and utility payments. Approximately $53 million from the federal Emergency Solutions Grant – Coronavirus (ESG-CV) program will be used to support the Department of Health and Human Services’ work on crisis response and housing stability.
  • Pennsylvania created the CARES Rent Relief Program with $150 million dollars in federal funding. This program provides funding to localities to assist “lessees that became unemployed after March 1, 2020, due to the COVID-19 pandemic, or lessees that are experiencing at least a 30 percent reduction in annual income related to COVID-19.” The program provides funds directly to property owners for rent accrued from March 1 to Dec. 30, 2020. Monthly assistance is capped at $750.
  • Wisconsin is leveraging $25 million dollars from the CARES Act to assist renters through the Wisconsin Rental Assistance Program. This program is a partnership between the Wisconsin Division of Energy, Housing and Community Resources and the Wisconsin Community Action Program Association. Renters with incomes below 80 percent of the county median income will be eligible for up to $3,000 per individual to cover rental payments and/or security deposits.

Implementing eviction moratoria through legislation:

  • In California, Gov. Gavin Newsom signed legislation that prohibits evictions before Feb. 1, 2021 “as a result of rent owed due to a COVID-19 hardship.” Tenants must pay 25 percent of rent due to avoid eviction.
  • In Massachusetts, legislators are considering H4878, which would create a moratorium on evictions and negative credit report filings until 12 months after the State of Emergency declared by Gov. Charlie Baker ends.
  • Proposed legislation, S8667, in the New York Senate would place a moratorium on evictions for residential and commercial properties. The bill states, “… it is counterproductive to public health and welfare to allow evictions and foreclosures until the COVID-19 pandemic has passed and sufficient time has been provided for communities to recover.” Similar to Massachusetts, the bill extends the moratorium until one year after the public health emergency ends.
  • In Virginia, the Virginia Supreme Court halted evictions until Sept. 7, 2020. State legislators are currently convening for a special session to consider a proposal to create a $3.3 million dollar Eviction Diversion and Prevention Pilot Program. Lawmakers will also consider a bill to pause evictions until April 30, 2021.

The financial impact of COVID-19 will extend far past 2020, with new research suggesting that 42 percent of recent layoffs could lead to permanent job loss. With the federal eviction moratorium in effect until Dec. 30, 2020, additional measures will be necessary to prevent evictions and housing insecurity for low-income individuals and families. Additionally, if the CDC order is successfully challenged in court, moratoria at the state level will become even more important to prevent evictions.

As states work to prevent evictions, there are a variety of other policy levers available to provide low-income individuals with assistance to find and maintain housing, often with the supportive services they need to maintain housing. The National Academy for State Health Policy Health and Housing Institute works with states across sectors on strategies to improve health and housing for vulnerable populations. Learn more about state work on improving housing and reducing homelessness at NASHP’s Housing and Health Resources for States.

This project was supported by the Health Resources and Services Administration (HRSA) of the US Department of Health and Human Services (HHS) under grant number UD3OA22891, National Organizations of State and Local Officials. This information or content and conclusions are those of the author and should not be construed as the official position or policy of, nor should any endorsements be inferred by HRSA, HHS or the US government.

Search

Sign Up for Our Weekly Newsletter

* indicates required
Please enter a valid email address.
Areas of Interest