West Virginia officials have struggled to spend the hundreds of millions of dollars allocated to the state to help struggling renters and landlords through the pandemic. Now, they have less money to work with after having to send more than $3 million back to the U.S. Treasury Department in December.
“I can’t emphasize enough, we never want to give money back,” said West Virginia Housing and Development Fund Director Erica Boggess. “We want to help the citizens of West Virginia.”
West Virginia launched its rental assistance program through the West Virginia Housing and Development Fund in late March. The program, funded with federal money, is meant to help West Virginians who are facing eviction or utility shutoffs. The WVHDF normally works with homeowners, and this is the agency’s first time overseeing a program for renters.
But since the program began nearly 10 months ago, officials have disbursed $45 million of the $350 million the state received. This slow pace is what prompted the federal government to ask for more than $3 million back, to redistribute to other states that were spending their money faster.
“There are lots of people that need 18 months worth of rental and utility assistance,” said Mountaineer Rental Assistance Program Manager Jessica Greathouse. “And we’re paying that out. And we also know that there’s a huge, probably untapped market out there.”
‘2021 definitely had an uptick’ in renters’ needs
Even though money has been slow to flow from the rental assistance program, some West Virginians are still at risk of losing their housing. Around the same time the state had to send the money back, the U.S. Census Bureau estimated in early December that roughly 37% of West Virginia renters, who were behind on rent, were “very likely” to face eviction within the next two months.
“I will say that 2021 definitely had an uptick,” said Shannon Cunningham-Snead, the executive director for the Central West Virginia Community Action Association, which serves the Clarksburg area.
Last year, her agency helped about 370 West Virginia households in its five-county service area with services, including utility and rental assistance for Lewis and Harrison counties.
Cunningham-Snead says she’s noticed requests for help ebb and flow with the availability of federal, direct assistance like stimulus checks, unemployment benefits and child tax credits.
“The calls really have fluctuated tremendously as other benefits have come to households, and we see ourselves catching a lot of customers who have fallen through the gaps of much of that assistance,” she said.
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While many unemployment benefits and direct payments to families have received widespread attention and coverage, some people worry that there has been little marketing or communications around the $350 million West Virginia received to provide rental and utility assistance to households affected by the pandemic.
Cunningham-Snead said that as we enter year three of the coronavirus pandemic, the state needs to do a better job making sure the word gets out to everyone who’s eligible.
“I think that there are a number of families who have been financially self-sufficient for quite a while, who have come upon hiccups such as loss of income because of quarantine, or a child’s school being closed,” Cunningham-Snead said. “Those are the people we worry about. Those are the people who have used their savings at this time, those are the people that have dipped into their retirement funds. As the emergencies hit, they’ve already exhausted their personal resources.”
Program improvements
West Virginia and a handful of other “small states” were first given $200 million for rental assistance in January 2021 through the CARES Act that was passed in response to the coronavirus pandemic. This funding has to be spent by September 2022, and there are a series of spending benchmarks that states must hit every month.
The state received an additional $150 million through another later coronavirus-related pot of money, the American Rescue Plan Act, that was also for rental and utility assistance later. This funding comes with fewer spending requirements and has a September 2025 deadline. WVHDF has spent some of this so far on renters, but also people living in recovery homes and sober living facilities, according to Greathouse.
Despite varying state sizes and needs, the monthly spending requirements imposed by the U.S. Treasury are the same for every state.
“There has been a lot of criticism across the country about slow spending on these things,” said Boggess. “But here’s the deal. They passed these laws very quickly, trying to get assistance out to people who needed it. Some states got more than they’re going to need, and others didn’t get what they needed, comparatively. … So even if we have expended every single thing in our pipeline, we’re still not hitting those funding ratios. We’re just not that big of a state.”
Now, WVHDF leaders say they’re working to pick up the pace, in case the federal government asks for more money back.
“I think we’re working quickly toward hitting our stride, in terms of getting applications out the door,” Greathouse said. “Eventually, we’re going to get to the point where we’re getting an application and turning it out again in days, instead of weeks.”
It wasn’t until months into the program that they hired more people to process applications through an outside contract. Before that, WVHDF was relying on its staff and community action agencies throughout the state to help process applications.
Right now, Greathouse says, it takes a normal application about four to six weeks to process, and processors throughout the state can get more than 100 new applications a day.
The process has also been complicated by new software. When WVHDF leaders submitted a program improvement plan to the U.S. Treasury last fall, they reported receiving more than 6,000 online applications during the software transition period – in an interview on Jan. 13, Greathouse said application processors are still working through much of that backlog today.
“As a rural state, there is a significant portion of the state that is unable to access our application software system due to technology constraints,” WVHDF wrote in the plan. “While we are committed to serving this population through application assistance and paper applications, it is a very labor-intensive process that is an obstacle to providing timely assistance.”
The program improvement plan further detailed what WVHDF said is causing West Virginia to spend so slowly, and how the state plans to fix that. Some promises include plans to partner with Legal Aid of West Virginia and target smaller-scale landlords with less than 10 rental units to increase the amount of money they give out.
If West Virginia’s improvement plan doesn’t work and the state doesn’t spend the money faster, it could risk losing more. Though WVHDF officials have increased the pace at which they’re approving applications, the federal government has other benchmarks that will need to be met this year for the agency to keep the rest of the money.