Vermont lawmakers on Thursday approved a plan to use nearly $100 million worth of federal funding to help low-income Vermonters who are struggling to pay their rent during the pandemic.
The money comes out of a $200 million pot of funding for housing and utility assistance included in the $1.3 billion Vermont received from Congress’ latest round of Covid-19 aid last December.
After hearing from state officials, the Legislature’s Joint Fiscal Committee agreed to use $99 million of the funds for a new rental assistance program.
“It’s a real opportunity for us to help low-income Vermont renters catch up on their bills and possibly save for a better future,” Josh Hanford, commissioner of the Department of Housing and Community Development, said of the newly approved funding.
“This is a huge opportunity that, if it’s used right, if it’s widely available, could have a lasting benefit on our low-income Vermonters that need this help,” he added.
Hanford said Vermonters would likely be able to begin applying for assistance in four to six weeks. He noted that, in addition to providing assistance to low-income residents, the program is also a “business support for the housing sector”
“Folks that own rental properties, that’s a business, and they haven’t been getting paid, and they have no recourse to evict someone for non-payment,” Hanford said.
The state previously offered rental assistance earlier in the Covid-19 pandemic. Last summer, the state stood up a $25 million rental relief program using federal Coronavirus Relief Fund dollars.
According to federal guidelines, to qualify for the new round of rental assistance, renters need to show that at least one member of their household qualifies for unemployment, faced a reduction in income, incurred significant cost or “experienced a financial hardship” due to Covid-19.
They also need to show their incomes total no more than 80% of the median income in a given area of the state. But Hanford said that applicants whose incomes are at 50% or below the median income will be given preference.
The state estimates there are 50,000 households that could qualify for assistance under the new program. But how many Vermonters receive benefits will depend on the need and how many people apply, Hanford said.
In approving the funding for the new program, lawmakers also put protections in place to assure that landlords who receive money through the program don’t hike their rent prices.
Sen. Jane Kitchel, D-Caledonia, a member of the Joint Fiscal Committee, said legislators were concerned that landlords, knowing that there was federal money available for rental assistance, could “maybe make fairly egregious increases in rents simply knowing that the funding would be there.”
They put another protection in place to ensure that landlords who receive funding maintain properties that follow safety codes.
Under the program, the funding will typically be sent directly to the landlords.
In addition to the $99 million for rental assistance, lawmakers signed off an additional $11 million to be used to cover the costs of administering the program, including the expense of hiring a third-party vendor to operate the rental assistance fund.
They also approved a plan to use about $13 million of the federal funding to help low-income Vermonters cover utility expenses. The state Department of Public Service has offered utility assistance during the pandemic using Coronavirus Relief Fund dollars.
But unlike the previous program, these newly available dollars can be used to help Vermonters pay for heat. They can’t, however, be used to cover the cost of internet services, Hanford noted.
Lawmakers also OKed $15 million to assist Vermonters experiencing homelessness.
Hanford said state officials hope to use these funds to help transition those who have been sheltering in hotels and motels throughout the Covid-crisis into permanent housing.
