Housing advocates push for more CARES Act funding for rental assistance

Indiana Gov. Eric Holcomb’s administration set aside $300 million in federal CARES Act funding for local units of government to use for pandemic-related expenses, but so far, rental assistance programs are not among the reimbursable items.

Housing advocates are arguing for that to change, saying demand for the two existing rental assistance programs—a $25 million program through the state government and a $15 million program for Marion County residents—has been overwhelming.

Applications for both the state and city programs exceeded capacity within several days of launching. As of July 21, the state had received nearly 17,500 applications for a program designed to help 12,000 households. The city had to suspend its application process and start a waitlist after receiving more than 10,000 applications.

The Hoosier Housing Needs Coalition, a group of several Indiana organizations that work on housing security, estimates that between those programs and other forms of government, faith-based or philanthropic support, about 50,000 households will be served.

But the coalition estimates that still leaves 200,000 households in need of assistance, and housing advocates are pushing for the issue to be addressed before Holcomb’s eviction moratorium expires.

Holcomb first issued the eviction moratorium in March and has continued to extend that order since then, but the current order is set to expire Friday. A spokesperson for Holcomb told IBJ he will address the issue during his press conference Wednesday afternoon.

The $300 million fund that Holcomb’s administration established in May with part of its $2.4 billion in CARES Act funding is designed to reimburse local governments for COVID-19-related expenses.

The federal law requires the money be spent on COVID-19-related expenses incurred from March 1 to Dec. 30. It can’t be used to replace lost tax revenue or for expenses already outlined in the state or local government budgets.

The reimbursement application for local governments includes six main categories for the types of expenses eligible—medical expenses, public health expenses, unforeseen payroll expenses, compliance expenses, economic support and other necessary government expenses.

Each category lists multiple examples of eligible expenses. Housing assistance is not listed, even though that is one of the allowed uses of the CARES Act money, under guidelines from the U.S. Department of the Treasury. The state is using CARES Act funding for its program, and Indianapolis—which received its own allocation of $168 million through the CARES Act—is also helping fund its rental assistance program with that money.

The governor’s office told IBJ that it doesn’t want local governments using the $300 million fund for programs that duplicate state efforts.

But Andrew Bradley, policy director at Prosperity Indiana, said he thinks local housing assistance programs would complement, not duplicate, the state program.

“If the folks closest to the ground are hearing that housing stability and rental assistance are major needs, they should be allowed all the flexibility,” Bradley said.

Bradley said local and state programs combined together could attract philanthropic partners to come to the table and help prevent evictions and homelessness. For example, the Lilly Endowment is helping fund the Marion County rental assistance program.

“Advocates out here don’t just want to be complaining,” Bradley said. “We want to be part of the solution, but there has to be something to work with.”

The issue of duplication doesn’t seem to apply to every funding area. For example, even though the state has a $30 million program to help small businesses and set aside $50 million to enhance workforce development programs, those uses would be considered reimbursable for local governments, Indiana Office of Management and Budget Director Cris Johnston said.

Johnston said the state could be open to allowing local governments to use the $300 million fund for housing needs, but only if the need isn’t being met by the existing state program.

Some cities, such as Noblesville and Fishers, say the need is being met with the existing resources.

Other community leaders, such as Hamilton County Commissioner Mark Heirbrandt, say they could see the need for more local housing support.

“We’ve got a lot of people that have lost their jobs and I could see an opportunity to help our citizens here that are in desperate need of rental assistance,” Heirbrandt said. “We could certainly use it, and I know our township trustees could use it.”

Johnston said the goal of the $300 million fund has been to help cities reopen safely.

Through July 23, the state has only disbursed about $4.5 million of the fund. Most of the disbursements—totaling nearly $2.9 million—have been for public health expenses, according to reports from the Indiana Finance Authority.

Johnston said the number of requests for reimbursement have increased over the past two weeks.

“It’s taken awhile for [local governments] to get organized and pull all their documentation together,” Johnston said.

IBJ reporter Kurt Christian contributed to this report.