July 4, 2021 - Washington - Senators Dianne Feinstein and Alex Padilla (both D-Calif.) last week called on the Treasury Department to expand access to the Emergency Rental Assistance Program to help prevent unnecessary evictions.

“In California, local housing authorities continue to hear from residents who are now experiencing financial hardship due to the pandemic but have remained current with their rent payments by incurring debt,” the senators wrote in a letter to Treasury Secretary Janet Yellen. “However, under current federal guidance, renters cannot use federal emergency rental assistance to pay down housing-related debt.

“This practice of renters incurring debt to avoid eviction is exactly the type of housing insecurity Congress intended to curb with the funds appropriated for the Emergency Rental Assistance Program,” the senators continued. “To assist these households, we request that you update the Emergency Rental Assistance Program guidance to allow households to receive federal rental assistance for rent paid for with credit cards or other loans.”

Full text of the letter is available here and below:

July 1, 2021

The Honorable Janet Yellen
Secretary of the Treasury
U.S. Department of Treasury
Washington, D.C. 20220

Dear Secretary Yellen:

We urge you to prevent unnecessary evictions by expanding access to the federal Emergency Rental Assistance Program. Specifically, we recommend that the Treasury Department update its guidance to allow vulnerable renters to use federal emergency rental assistance to pay down housing-related debt.

In March 2021, the Federal Reserve reported that nearly double the number of renters borrowed funds to afford rent during the pandemic. In California, local housing authorities continue to hear from residents who are now experiencing financial hardship due to the pandemic but have remained current with their rent payments by incurring debt. However, under current federal guidance, renters cannot use federal emergency rental assistance to pay down housing-related debt.

This practice of renters incurring debt to avoid eviction is exactly the type of housing insecurity Congress intended to curb with the funds appropriated for the Emergency Rental Assistance Program. To assist these households, we request that you update the Emergency Rental Assistance Program guidance to allow households to receive federal rental assistance for rent paid for with credit cards or other loans. This clarification fits within the broad authority Congress provided to the Treasury Department to define “other expenses related to housing” in the distribution of federal rental assistance in the Consolidated Appropriations Act, 2021 and the American Rescue Plan Act of 2021.

We appreciate the Treasury Department’s efforts to distribute the urgently needed rental assistance provided by Congress, and we hope to work with you to ensure renters who incurred debt are able to access these funds. Thank you for your attention to this important matter, and we look forward to your response.

Sincerely,

Dianne Feinstein
United States Senator

Alex Padilla
United States Senator
Source: Senator Dianne Feinstein