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State Agency Running Emergency Rental Assistance Program Pulls $86 Million From Local Partners

Multnomah County will lose $19 million.

Oregon’s efforts to distribute federal rental assistance to tenants in danger of eviction continue to flounder.

The state agency in charge of handling the Oregon Emergency Rental Assistance Program wrote a letter to local program leads Sept. 7 announcing it would be pulling $86 million in funding from community action agencies struggling to distribute rental assistance dollars.

Oregon Housing and Community Services handles the pot of $203 million in rental assistance money. It delegated the task of processing applications for assistance to community action agencies. Those agencies were supposed to communicate with renters and landlords and hand out checks.

That process has been plagued by a poorly functioning state computer system and staffing shortages at the local level.

As a result, only $34 million of the $132 million that is supposed be distributed by Sept. 30 has been spent.

So OHCS told its local partners it would be pulling $86 million from “undersubscribed” local agencies and reallocating that money, which it will then redistribute based on need.

Multnomah County will lose $19 million.

“We have $98 million remaining to spend out by the end of September, requiring more than double the rate of current processing statewide,” OHCS assistant director of homelessness Laura Lien wrote. “There are several regions that are undersubscribed and several that are oversubscribed. This means we need to immediately shift our typical reallocation structure to satisfy rent and utility assistance requests across the state.”

In short, the regions that are processing applications more slowly and cannot push checks out quickly enough will get a chunk of their requested money reallocated to regions that are processing applications and sending out checks at a faster pace.

The latest move by OHCS raises the question of who can best handle the money: local community action agencies or the state.

OHCS says it’s not taking any money away from county renters who requested dollars—it’s just waiting for the county to process its current applications before it gives money back when the county is actually ready to push it out the door.

“Rebalancing of resources is a standard and long-held practice in public administration which happens at the local level,” says OHCS spokesman Connor McDonnell. “Our goal along with our local administrators remains to keep all Oregonians stably housed and the demand and the ability for local administrators to pay out funds is informing our actions.”

Multnomah County, too, maintains that this is a smart move—and might even help get applications processed quicker.

“[OHCS] is pulling money to help them be more flexible so they can get more money to counties that have huge numbers of people waiting to get rent assistance, and we are one of those counties,” says Denis Theriault, spokesman for the Joint Office of Homeless Services. “They’re moving that into a central fund and giving it wherever they see need, but we think we’re going to get that money back to the county for renters. They’ve assured us they’ll help us process as many applications as they can.”

But tenant and landlord advocates aren’t happy about money going from community action agencies back to a state-run reserve.

Deborah Imse, executive director of the landlords’ association Multifamily NW, says the memo “makes conflicting statements.”

“At one point they state the decision was made due to lack of demand and at another point in the memo they state it is because their own modeling showed they wouldn’t be able process applications quickly enough to meet the first treasury deadline and avoid a claw back of funding,” Imse says. “We have been tracking demand for rental assistance throughout the pandemic, and we know the demand is great across all counties. We also know from monitoring the rental assistance program that OHCS are far from on track to meet the treasury requirement by Sept. 30″.

Jimmy Jones is executive director of the Mid-Willamette Valley Community Action Agency, which was tasked with cutting checks in Marion and Polk counties. While applications in his counties are moving quickly, Jones says he’s concerned that the $86 million going back to a state reserve will further hinder the process of getting money to renters.

“Without any consultation, this memo was sent out about recapturing large sums of money from community action agencies across the state and dedicating them to a statewide pool,” Jones says. “We’re removing local control, expertise and capacity to a group that has no experience with these things. There’s no way to ensure those resources will remain in those local communities.”

According to OHCS’s weekly report, only 11% of the applicants in Multnomah County have been submitted for funding (their landlords have not necessarily received checks yet). About 47% (5,236 households) of county applications are still pending initial review.

More than 40 community action agencies throughout the county are tasked with processing applications and sending checks to landlords. Throughout the pandemic, they’ve said they’re understaffed, underresourced and burdened by the new online and problem-riddled system implemented by the state.

A sliver of hope: Agencies can re-request some of that money if they process all their current applications.

“OHCS will be following up with additional information on how local program administrators can request additional funds from the centralized reserve if they spend their remaining funds,” Lien wrote. “However, please note that agencies should focus on immediately spending down their available funds prior to requesting additional funding.”