Minnesota Housing will stop accepting applications for COVID-19 emergency rental assistance Friday, the agency announced, saying $528 million the state received from the federal government is quickly depleting.
The sudden decision means some Minnesota renters could be at risk of eviction sooner than expected, since the state's pandemic measures were set to protect tenants with outstanding claims for rental assistance until June 1.
The announcement came Tuesday, after the state's RentHelpMN program received an unprecedented uptick in applications in January, Minnesota Housing Commissioner Jennifer Ho said. The state has requested additional federal funds but does not expect to receive them, she said.
"We realize this may affect households that continue to struggle to cover their rent and other housing costs," Minnesota Housing said in a news release. "The need for help is greater than the funds available."
Tenants must owe past-due rent to be eligible for the program, and Friday's 9 p.m. deadline applies to new applicants and those who previously received aid. Renters can apply online at RentHelpMN.org or call the 211 helpline.
Previously submitted requests will continue to be processed. The program's website will shut down over the weekend so the agency can close the application window, but it will reopen Monday to allow renters to track requests.
The state delivered $349 million to more than 46,000 households as of Jan. 20, according to Minnesota Housing. The agency estimates it will distribute a total of $450 million in direct assistance to complete pending applications, as well as additional requests submitted by the Friday deadline, Ho said.
The remaining $78 million from the federal government, plus another $7 million from the state's American Rescue Plan allotment, is being spent on the costs of administering the program and housing stability services, Ho said.
"We've tried to be very clear from the beginning that it was a finite amount of federal money, and it wasn't going to always be there," she said. "Without this protection, people who get behind in February — they just don't have this safety net anymore. A lot of people are hurting. This is really hard."
The federal government gave about $145 million to allow a handful of local governments to distribute additional rent assistance, some of which could still be available for eligible residents. Native American tribes also received federal money to distribute for rent payments. Ho said Minnesota Housing will be gathering information about other programs tenants may be able to access if they fall behind on rent after the state program ends.
The announcement drew criticism from Republican legislators, who previously pressed Ho during an informational hearing about the pace at which the agency distributed federal dollars for rental assistance.
"From a shaky rollout to this abrupt closure, Commissioner Ho has mismanaged RentHelpMN every step of the way," Senate Housing Finance and Policy Chair Rich Draheim, R-Madison Lake, said in a statement. "A month ago, we could see the program running out of money and the need to have a plan in place that gave adequate notice to Minnesotans. And now, Commissioner Ho has manufactured a crisis that could have been avoided."
The decision also prompted Democratic legislators and housing advocates to renew calls for a universal rental assistance program.
"The need is still immense and will persist even if rental assistance dollars go away," House Housing Finance and Policy Vice Chair Michael Howard, DFL-Richfield, said in a statement. "If we don't take urgent action, the result could be an eviction crisis amidst a pandemic, something we have worked tirelessly to prevent for the last two years."
Tenants cannot be evicted for failing to pay rent through May if they have pending applications for assistance, but they must still attend court hearings, Ho said. As of Jan. 20, Minnesota Housing has provided information in 1,290 eviction cases.
Income-qualified residents will continue to be able to request help covering utilities through the federally funded Energy Assistance Program.